Document:

exv10w51

Exhibit
10.51

CONSTRUCTION LOAN AGREEMENT
 The Grove Apartments located at 4301 West 24th Place, Lawrence, Douglas County, Kansas

     THIS AGREEMENT is made and entered into this 13th day of February, 2009, by and
between CAMPUS CREST AT LAWRENCE, LLC, a Delaware limited liability company (the “Borrower”), and
MUTUAL OF OMAHA BANK, a federally chartered savings bank, and its successors and/or assigns (the
“Lender”).

	 	 	WITNESSETH THAT, in consideration of the mutual covenants and agreements hereinafter set
forth, the parties hereto agree as follows:

DEFINITIONS

     For the purposes of this Agreement, the following terms shall have the following respective
meanings, unless the context hereof clearly requires otherwise:

     Advance: The Advance by the Lender to the Borrower of Loan proceeds pursuant to
Article III hereof.

     Affiliate: Any partner of the Borrower, or entity controlled by or under common
control with the Borrower.

     Agreement: This Construction Loan Agreement, including any amendments hereof and
supplements hereto executed by Borrower and Lender.

     Assignment of Leases and Rents: The Assignment of Leases and Rents of even date
herewith, by which the Borrower makes a general assignment in favor of the Lender of all leases
and rents and income from the Project.

     Borrower: CAMPUS CREST AT LAWRENCE, LLC, a Delaware limited liability company and its
permitted successors and assigns.

     Budget. The itemized summary of estimated or intended expenditures for the Project,
as approved by Borrower and Lender.

     Business Day: Any day other than a Saturday, a Sunday, or a legal holiday on which
Lender is not open for business.

     Commitment: The loan commitment letter from the Lender to the Borrower dated February
3, 2009, accepted by the Borrower on February 4, 2009.

     Completion: The date as of which all Improvements (other than improvements which
cannot be constructed during winter months such as landscaping and surfacing of parking areas) are
completed in accordance with the Plans, as approved by Lender, and paid for in full (other than
payments to be made pursuant to the final draw request), free of all mechanics’, labor,
materialmen’s and other similar lien claims; said completion has been approved and certified by

 

the General Contractor and by the Inspecting Architect, if any; certificate(s) of substantial
completion in form acceptable to Lender for Improvements has/have been signed by Borrower, the
General Contractor and delivered to Lender, and no substantial punch-list items remain to be
completed; Lender has received acceptable evidence that all Governmental Requirements and all
private restrictions and covenants relating to the Project have been complied with or satisfied
and that unconditional certificates of occupancy for all of the occupied Improvements have been
issued by all appropriate governmental authorities; Borrower has obtained and delivered to Lender
copies of all licenses and permits needed to operate the occupied Improvements; Lender has
received photographs of the completed Improvements, copies of all warranties from suppliers
covering roofing systems, materials, equipment and appliances included within the Project, as may
be requested by Lender, evidence that all insurance required hereby is in full force and effect
and one (1) copy of an as-built survey of the Project which conforms with Lender’s requirements
(described herein); and no Event of Default exists hereunder.

     Completion Date: April 1, 2011.

     Construction Commencement Date: April 1, 2009.

     Construction Costs: All costs paid and to be paid to construct and complete the
Project, including but not limited to site preparation costs, architectural fees, engineering
fees, and all costs of labor, material and services paid or incurred by Borrower, exclusive of
Land costs.

     Consultants: Third party experts retained by Lender to assist it in connection with
closing, advancing, disbursing or administering the Loan, including, without limitation, an
Inspecting Architect and a mortgage banker.

     Contingency Reserve: A reserve of Loan proceeds to pay costs of the Project which are
in excess of the amounts thereof anticipated on the date hereof, whether as a result of price
increases, changes in the Plans or otherwise, the initial amount of which shall be $746,000.00.

     Default Rate: The Default Rate of interest payable under the Note, as that term is
defined in the Note.

     Disbursing Agent: Chicago Title Insurance Company.

     Disbursing Agreement: The Disbursing Agreement, of even date herewith, relating to the
disbursement of proceeds of the Loan among Borrower, Lender and the Disbursing Agent, including any
amendments thereof and supplements thereto executed by said parties.

     Environmental Audit: A written environmental review, audit, assessment or report
addressed to Lender, setting forth the results of an investigation of the Project, including an
historical investigation of the uses and ownership of the Land, contacts with appropriate
governmental agencies and any Tests which may be requested by Lender, prepared by a competent
environmental engineer or consultant who is acceptable to Lender and is licensed, bonded and
insured in accordance with all applicable statutes.

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     Environmental Indemnity Agreement: The Environmental and A.D.A. Indemnity
Agreement of even date herewith, executed by the Indemnitors in favor of the Lender, including any
amendments thereof and supplements thereto.

     Equipment: All fixtures, equipment and personal property owned by Borrower and
located or to be located in or on, and used in connection with the management, maintenance or
operation of, the Land and the Improvements.

     Event of Default: An Event of Default specified in Section 6.1 hereof.

     Force Majeure: Acts of God, unavailability of labor or materials, unforeseen property
conditions, strikes, lockouts, acts of the public enemy, the enactment, imposition or modification
of any applicable law which occurs after the date of this Agreement and which prohibits or
materially interferes with the development or construction of the Project; confiscation or seizure
by any government or public authority, wars or warlike action (whether actual and pending or
expected, and whether dejure or defacto), arrests or other restraints of government (civil or
military, but excluding restraints on the development or construction of the Project occurring as
a result of any violations, by the party claiming the right to delay performance, of applicable
law or the terms and provisions of this Agreement), blockades, insurrections, riots, civil
disturbances, governmental restrictions, epidemics, landslides, adverse weather conditions
(including, without limitation, lightning, earthquakes, fires, hurricanes, storms and floods),
washouts, explosions, breakage or accident to major equipment or machinery critical to the
development of the Project and/or construction of the Project, nuclear reaction or radiation,
radioactive contamination, acts, or the failure to act, of any governmental authority or any other
causes, whether of the kind herein enumerated or otherwise, which are not reasonably within the
control of the party claiming the right to delay performance on account of such occurrence and
which, in any event, are not a result of the negligence of the Borrower.

     General Contractor: Campus Crest Construction, LLC.

     Governmental Requirements: All laws, statutes, codes, ordinances, and governmental
rules, regulations and requirements applicable to Borrower, Lender and the Project.

     Guarantors: Ted W. Rollins, as an individual and Michael S. Hartnett, as an
individual.

     Guaranties: The Guaranties of Completion and Payment, of even date herewith, executed
by the Guarantors, together with any amendments thereof or supplements thereto.

     Improvements: The buildings and improvements described on Exhibit C attached
hereto and hereby made a part hereof, if any, and which are or may be placed or constructed upon
the Land during the life of this Loan.

     Indemnitors: The Borrower and the Guarantors.

     Inspecting Architect: Any independent architect, engineer or Consultant selected by
Lender.

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     Interest Rate: The Note Rate, as such term is defined and more fully described
in the Note.

     Interest Deposit Account. A deposit of Loan proceeds at closing into an interest
bearing account with Lender in the amount of $424,000.00, for purpose of paying interest on the
Loan from and after September 1, 2009 only.

     Interest Reserves: Two reserves of Loan proceeds to pay interest on the Loan through
Completion of the Improvements, one reserve in the initial amount of which shall be $293,613.00
(Interest Reserve I), and a second reserve in the initial amount of which shall be $281,480.00
(Interest Reserve II).

     Land: The land legally described on Exhibit A attached hereto and hereby made
a part hereof, together with all additions and accretions thereto and substitutions therefor
agreed to by Borrower and Lender.

     Lender: Mutual of Omaha Bank, a federally chartered savings bank, and its successors
and/or assigns, 13220 Metcalf St., Suite 370, Overland Park, KS 66213, Overland Park, KS 66213.

     Loan: The loan of the proceeds of the Note by the Lender to the Borrower in Advances
to be made pursuant to the terms of this Agreement.

     Loan and Carrying Charges: All fees to Lender, all commitment fees, inspection fees,
environmental site assessment fees, appraisal fees, brokerage fees, standby fees, interest
charges, service fees, reasonable attorneys’ fees (including reasonable attorneys’ fees for
Lender), contractors’ fees, developers’ fees, title insurance fees and charges, recording fees,
registration taxes, real estate taxes, special assessments, utility charges and insurance premiums
incurred and to be incurred by Borrower in connection with the Project and payable prior to or
during the term of this Agreement.

     Loan Documents: The documents described in Section 2.2 of this Agreement, which
evidence and secure the Loan, including but not limited to the Note, the Mortgage, this Agreement,
the Environmental Indemnity Agreement, and the Disbursing Agreement, and including any amendments
and/or restatements thereof and supplements thereto executed by Borrower and Lender.

     Maturity Date: The Maturity Date as set forth in the Note.

     Mortgage: The first Combination Mortgage, Security Agreement, Assignment of Leases
and Rents, and Fixture Financing Statement, of even date herewith, covering the Project, executed
by the Borrower in favor of the Lender to secure the Loan, including any amendments thereof and
supplements thereto executed by the Borrower and the Lender.

     Note: The Promissory Note, of even date herewith, executed and delivered by Borrower
to Lender in the principal amount of Sixteen Million and No/100ths Dollars ($16,000,000.00), to
evidence the Loan, as the same may be amended, modified or replaced from time to time.

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     Permitted Encumbrances: The liens, charges and encumbrances on title to the
Project listed on Exhibit B hereto, if any.

     Plans: The final working plans for the Improvements, including drawings,
specifications, details and manuals, as approved by Lender.

     Pollutant: Any hazardous or toxic substance, waste or material, or other pollutant or
contaminant (including but not limited to radioactive materials, gasoline, asbestos,
urea-formaldehyde and polychlorinated biphenyls), as those terms are defined or used in any
Governmental Requirement.

     Project: The Land, the Improvements and the Equipment.

     Project Architect: James L. Browning.

     Reserves: The Interest Reserve and the Contingency Reserve.

     Sworn Construction Cost Statement: An itemized, certified statement of actual and
estimated costs of the Project, in a form reasonably acceptable to the Lender and the Disbursing
Agent, signed and sworn to by the Borrower and the General Contractor, as the same may be amended
or supplemented with the approval of the Lender from time to time.

     Tests: Such soil tests, chemical tests, material tests and other tests and analyses
as are appropriately required to confirm, with relative certainty, the absence of Pollutants from
the Project.

     Title Company: Chicago Title Insurance Company, its successors and assigns.

     Title Policy: A loan policy of title insurance in favor of Lender issued by the Title
Company and complying with the requirements of Exhibit D attached hereto and hereby made a
part hereof.

     Total Project Costs: The total of all Construction Costs and Loan and Carrying
Charges.

I. LOAN

Section 1.1 — Principal

     Lender agrees to lend to Borrower, and Borrower agrees to borrow from Lender, the proceeds of
the Loan in accordance with the terms hereof until the Maturity Date, for the purpose of developing
the Project. All Advances of Loan proceeds shall be evidenced by the Note. The maximum amount of
the Loan is expressed in the Note, and is not a revolving line of credit. Notwithstanding the
expressed principal amount of the Note, Borrower shall not be obligated to repay more than the
unpaid balance of all Advances made to or for the benefit of Borrower by Lender pursuant hereto and
to the other Loan Documents, together with interest thereon at the rates specified below and in the
Note, computed on all Advances from the date they are made by Lender, and Loan and Carrying
Charges. In no event shall Lender be obligated hereunder to lend to Borrower more than Borrower has
qualified to receive under the terms of Article III hereof.

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Section 1.2 — Interest

     Borrower shall pay to Lender interest computed at the Interest Rate. If all unpaid Advances
made by Lender have not been repaid on or before the Maturity Date, then the entire unpaid balance
of all unpaid Advances made by Lender on the Loan, shall (without notice to or demand upon
Borrower) become due and payable on said date, together with all unpaid, accrued interest thereon,
and with interest computed from and after that date in accordance with the terms of the Note,
until all unpaid Advances and all other amounts due in connection with the Loan are paid in full.
The Note provides for interest at the Default Rate after maturity or an Event of Default and for a
late payment charge.

     In the event that the interest and/or charges in the nature of interest, if any, provided for
by this Agreement or by any other Loan Document, shall contravene a legal or statutory limitation
applicable to the Loan, if any, Borrower shall pay only such amounts as would legally be
permitted; provided, however, that if the defense of usury and all similar defenses are
unavailable to Borrower, Borrower shall pay all amounts provided for herein. If, for any reason,
amounts in excess of the amounts permitted in the foregoing sentence shall have been paid,
received, collected or applied hereunder, whether by reason of acceleration or otherwise, then,
and in that event, any such excess amounts shall be applied to principal, unless principal has
been fully paid, in which event such excess amount shall be refunded to Borrower.

Section 1.3 — The Interest Reserve and Interest Deposit Account

     The Interest Reserves are not segregated funds as such, but rather reserves of disbursable
Loan proceeds that may be Advanced only in accordance with this Agreement. The funds designated as
Interest Reserve I will be available for disbursement from and after the date hereof, subject to
Borrower’s compliance with the terms and conditions of this Agreement. The funds designated as
Interest Reserve II will be available for disbursement on and after September 1, 2009, subject to
Borrower’s compliance with the terms and conditions of this Agreement, including without
limitation this Section 1.3 and Section 3.3. The Interest Deposit Account is an interest bearing
account or fund on deposit with the Lender. The Borrower may only withdraw funds from the Interest
Deposit Account for the payment of interest from and after September 1, 2009, and then only if the
Project is substantially completed and a certificate of occupancy has been issued and has a 50% or
greater lease-up.

     Interest Reserve II shall be reserved until September 1, 2009, and thereafter will remain
reserved unless and until the Loan is in balance under Section 3.3, and nothing in this Section
alters the obligation of the Borrower to maintain the Loan in balance pursuant to Section 3.3 at
all times, and the Borrower agrees that no part of the Interest Reserves shall be treated as
available loan proceeds for completing the Project when calculating whether the loan is in
balance.

     The Lender shall be secured in the Interest Deposit Account, and upon the occurrence and
continuance of an Event of Default, the Lender may apply the money in the Interest Deposit Account
to any outstanding balance on the Loan.

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Section 1.4 — Prepayment

     Prepayment of the principal advanced hereunder and of accrued interest thereon shall be made
only in compliance with the terms of the Note. Lender shall not be obligated to re-advance to
Borrower any sums prepaid by Borrower, whether prepaid voluntarily or involuntarily pursuant to
the terms of any Loan Document.

Section 1.5 — Fee

     In addition to the interest specified above, the Borrower has paid to the Lender a
non-refundable origination fee of $80,000.00, and shall pay an additional non-refundable fee of
$80,000.00 at the time of the execution of this Agreement.

Section 1.6 — Extension of the Maturity Date

     The Maturity Date may be extended subject to the conditions as set forth in the Note and in
accordance with the provisions of this paragraph. Any extension, in addition to any other
limitations or conditions set forth in the Note, is subject to the full, complete, and timely
satisfaction of each of the following conditions precedent: (i) On or before 30 days prior to the
then current Maturity Date, Borrower shall have provided Lender with written request to extend the
Maturity Date; (ii) Borrower and Guarantors, respectively, shall have delivered, at Borrower’s
sole cost and expense, all extension and other agreements, instruments, amendments, title
insurance endorsements, and modifications required by Lender to secure the performance of the
obligations of Borrower and Guarantors under the Loan Documents; (iii) no material adverse change
shall have occurred in the financial condition of the Borrower and Guarantors; (iv) each of the
conditions listed in Sections II and III shall have been fully satisfied with respect to all of
the Improvements; (v) no Event of Default, or event which, with notice or the passage of time
would constitute an Event of Default, shall be then existing.

II. CONDITIONS OF BORROWING

     Lender shall not be required to make any Advances hereunder until the pre-closing
requirements, conditions and other requirements set forth below have been completed and fulfilled
to the satisfaction of Lender, at Borrower’s sole cost and expense. It is agreed, however, that
Lender may, in its discretion, make any Advance prior to completion and fulfillment of any or all
of such pre-closing requirements, conditions and requirements, without waiving its right to
require such completion and fulfillment before any additional Advances are made.

Section 2.1 — Pre-Closing Requirements

     Prior to or on the date of the closing of the Loan, Borrower shall provide to Lender each of
the following, in form and substance acceptable to Lender:

	 	A.	 	A copy of the Borrower’s Certificate of Formation and Limited Liability
Company Agreement and any control agreement (certified by a member of the Borrower as
being true, correct, complete, unamended and in full force and effect), together with
a Certificate of Good Standing dated as of a recent date from the office of the
Secretary of State of Delaware and Kansas, resolutions of

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	 	 	 	the Borrower’s members/managers authorizing the transaction described herein and
certifying as to incumbency of persons signing on behalf of Borrower, and evidence,
satisfactory to Lender, that Borrower has complied with all filing requirements and
fictitious name requirements, if any, necessary to permit Borrower to do business in
Delaware and Kansas, and evidence, satisfactory to Lender, that Borrower has complied with
the above-mentioned documents in executing the Loan Documents.

	 	B.	 	The most current available financial statements of Borrower and the Guarantors,
and, upon request of the Lender, financial statements of each of said parties for
the most recent full fiscal year of said parties immediately preceding the time
period covered by said current financial statements, together with copies of all
federal income tax returns (with all supporting schedules) of each of said parties
for their most recent fiscal year, all signed and certified as true, correct and
complete by the party to which they apply. If any such party is not an individual
person, said financial statements must also be certified by an independent
certified public accountant of recognized standing acceptable to Lender.
	 
	 	C.	 	A commitment for the Title Policy or a preliminary title report from the Title
Company, together with true and complete copies of all documents affecting title
to the Land and the pro forma endorsements to the Title Policy as shall be
deemed necessary or appropriate by the Lender.
	 
	 	D.	 	A current, certified ALTA/ACSM LAND TITLE SURVEY of the Land, which
shall also be prepared in accordance with the requirements set forth in the
Commitment.
	 
	 	E.	 	An appraisal of the Project, addressed to Lender prepared in conformance with
Lender’s appraisal policy, Title XI of the Federal Financial Institutions Reform,
Recovery and Enforcement Act of 1989 (“FIRREA”) and prevailing standards of
appraisal practice, and signed by an appraiser acceptable to Lender. The
appraisal shall support a loan to value ratio of no more than 80.00%.
	 
	 	F.	 	An Environmental Audit in compliance with the All Appropriate Inquiries Final
Rule or the American Society for Testing and Materials (ASTM) Designation E
1527-05 showing that no Pollutant (except as agreed and accepted by Lender) is
present above, on, in or under the Project, and all reports, data and other
information produced in connection with the Tests. The Environmental Audit
shall also specify whether or not any environmental assessment, study or
statement with respect to the Project is required by any Governmental
Requirement or recommended by the consultant preparing the Environmental
Audit.
	 
	 	G.	 	Evidence acceptable to the Lender that the Land is not in a flood zone, or else
proof satisfactory to Lender that the Borrower has obtained the legally required
level of flood insurance for the Project.

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	 	H.	 	Soil reports on the Land, showing that the soil will adequately support the
Improvements when constructed in accordance with the Plans.
	 
	 	I.	 	A complete set of the Plans. All mechanical, electrical, structural and other specialized drawings shall be signed by licensed engineers of the respective disciplines
normally responsible for such drawings, in addition to the Project Architect.
	 
	 	J.	 	The General Contractor’s construction contract, the Project Architect’s agreement, a schedule listing all subcontracts relating to the Project, and such other
contracts, subcontracts and schedules relating to the Project and relating to the
creditworthiness and experience of the General Contractor as Lender reasonably may
require. The Lender reserves the right to require bonding of subcontractors who do not
demonstrate satisfactory financial capacity, and in all cases in which bonding is required
and/or obtained, the Lender shall be named as a protected party in the dual obligee bond.
The construction contract, the Budget and the Sworn Construction Cost Statement shall
support a loan to cost ratio of no more than 80.00%
	 
	 	K.	 	The Sworn Construction Cost Statement or other cost statement acceptable to Lender.
	 
	 	L.	 	Borrower’s estimated schedules for construction of the Improvements and for disbursement of
the Loan proceeds.
	 
	 	M.	 	Copies of any issued building permits related to construction of the Improvements, and a
schedule of all other necessary licenses and permits which must be obtained in order to
complete, occupy and operate the Project.
	 
	 	N.	 	A letter from an appropriate municipal officer regarding zoning and building code compliance
or, in the alternative, a zoning endorsement attached to the Title Policy.
	 
	 	O.	 	UCC chattel lien, tax lien and judgment searches from the appropriate office in Douglas
County, Kansas, and from the offices of the Secretary of State of Kansas, covering the name of
the Borrower and Guarantors.
	 
	 	P.	 	Letters from the suppliers (or equivalent proof satisfactory to Lender) confirming the
availability of water, sanitary sewer, gas, electric and telephone utilities for the Project,
if applicable.
	 
	 	Q.	 	Insurance policies or certificates evidencing insurance coverages written by insurers
satisfactory to Lender and in amounts satisfactory to Lender, prepared in accordance with
Lender’s requirements therefor, as shown on Exhibit E attached to this Agreement.

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Section 2.2 — Loan Documents

     On or before the date of closing of the Loan, the Borrower shall execute and deliver (or
cause to be executed and delivered) to the Lender the following documents in form and substance
acceptable to the Lender and to its counsel, to evidence and secure the Loan (collectively, the
“Loan Documents”):

	 	A.	 	The Note.
	 
	 	B.	 	The Mortgage.
	 
	 	C.	 	The Assignment of Leases and Rents.
	 
	 	D.	 	A first security interest in all Equipment and in all of Borrower’s
intangible
property relating to the Project, created and evidenced by a security agreement
(which may be incorporated within the Mortgage) and by appropriate Uniform
Commercial Code financing statements.
	 
	 	E.	 	An assignment of the Plans and of the Project Architect’s agreement pursuant
to which the same were prepared, along with written acknowledgment from the
Project Architect authorizing Lender to rely on and utilize the Plans, without
additional charge, and further confirming to Lender that, in the Event of Default,
the Project Architect will cooperate with Lender regarding the Completion of
construction of the Project.
	 
	 	F.	 	An assignment of Borrower’s general construction contract for the Project
and an
agreement from the General Contractor to honor and perform the same for
Lender in the case of an Event of Default under the Loan Documents.
	 
	 	G.	 	An assignment of any property management agreements between Borrower and
any management company managing the Project.
	 
	 	H.	 	The Disbursing Agreement.
	 
	 	I.	 	The Environmental Indemnity Agreement.
	 
	 	J.	 	The Guaranties.
	 
	 	K.	 	Such other documents as Lender may require to evidence and secure the Loan.

     Lender may designate which of the Loan Documents are to be placed of record, the order
of recording thereof, and the offices in which the same are to be recorded. Borrower shall pay all
documentary, recording and/or registration taxes and/or fees, if any, due upon the Loan Documents.

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Section 2.3 — Title Insurance

     Lender shall have received the Title Policy or a commitment by the Title Company for the
issuance of the Title Policy, marked up by the Title Company to the satisfaction of the Lender.

Section 2.4 — Opinion of Borrower’s and Guarantors’ Attorneys

     Lender shall have received from corporate counsel and outside counsel in Kansas for Borrower
and Guarantors a current written opinion, in scope, form and substance acceptable to Lender.

III. THE ADVANCE OF THE LOAN PROCEEDS

Section 3.1 — General

     The Loan proceeds shall be advanced by Lender, for the benefit of the Borrower, in accordance
with the terms and conditions set forth in this Article III, and in accordance with the Disbursing
Agreement. All monies advanced by the Lender (including amounts payable to Lender and advanced by
Lender to itself pursuant to the terms hereof) shall constitute loans made to the Borrower under
this Agreement, evidenced by the Note and secured by the other Loan Documents, and interest shall
be computed thereon, as prescribed by this Agreement and the Note, from the date Borrower’s Loan
account is charged with the amount of the Advance, whether or not an Advance made to the
Disbursing Agent is fully disbursed by the Disbursing Agent or is withheld in full or in part;
provided, however, Borrower shall be permitted to reallocate final savings in a particular line
item of the Sworn Construction Cost Statement upon completion of all work represented by such line
item, without Lender’s permission, but only upon prior written notice to the Lender.

     Lender reserves the right to make Advances of amounts which are allocated to any of the
designated items in the Sworn Construction Cost Statement for such other purposes or in such
different proportions as Lender may, in its discretion, deem necessary or advisable. Borrower may
not reallocate items in the Sworn Construction Cost Statement without the prior written consent of
Lender, which consent will not be unreasonably withheld or delayed, it being understood that
Lender will use good faith efforts to approve any such requested reallocation within 5 business
days of Borrower’s request.

     No Advance shall constitute a waiver of any condition precedent to the obligation of the
Lender to make any further Advance or preclude the Lender from thereafter declaring the failure of
the Borrower to satisfy any such condition precedent to be an Event of Default. All conditions
precedent to the obligation of Lender to make any Advances are imposed hereby solely for the
benefit of Lender, and no other party may require satisfaction of any such condition precedent or
shall be entitled to assume that Lender will make or refuse to make that Advance or any Advance in
the absence of strict compliance with such condition precedent.

     In the event that the total amount of the Loan exceeds the amount needed to fully pay all cost
allocations set forth on the Budget and the Sworn Construction Cost Statement approved by

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Lender, Lender shall not be required to advance, and Borrower shall not be entitled to receive,
the excess:

     Subject to compliance by the Borrower with the terms and conditions set forth in Section
3.2 below, the Lender shall make Advances for costs incurred by the Borrower with respect to
materials stored on or off the Project site.

Section 3.2 — Advances for Stored Materials

     Notwithstanding anything to the contrary contained in this Agreement, the Lender shall make
disbursements of Loan proceeds to pay for Construction Costs actually incurred by the Borrower for
stored materials required in connection with the construction of the Improvements, provided that
(i) such materials are in accordance with the Plans, (ii) such materials are securely stored and
properly inventoried, (iii) such materials, if stored off-site, are stored in a bonded warehouse
or with a contractor, material man or fabricator who bears the risk of loss until delivery and
installation of such materials in the Improvements as part of the work in place, (iv) such
materials are insured against casualty, loss and theft in a manner satisfactory to the Lender, (v)
the Borrower owns such materials free and clear of all liens and encumbrances of any nature
whatsoever (other than the lien of Lender) and established such ownership by evidence reasonably
satisfactory to the Lender, (vi) the Borrower executes and delivers to the Lender such additional
security documents as the Lender shall deem reasonably necessary to create and perfect a first
lien in such materials as additional security for the payment of the Loan, (vii) the aggregate
amount of such disbursements for such materials is verified by the Lender pursuant to the
provisions of this Agreement, and (viii) the aggregate amount of such disbursements for such
materials which are stored shall in no event exceed $1,000,000.00.

Section 3.3 — Loan In Balance

     Lender shall not be obligated to make any Advance of Loan proceeds unless and until Borrower
has provided Lender with evidence, acceptable to Lender, that the Loan is in Balance, i.e.
(a) the undisbursed portion of Loan proceeds allocated to each line item in the Budget, as amended
from time to time, is sufficient to complete each such line item, and (b) the then undisturbed
portion of the Loan, less an amount equal to the Contingency Reserve, equals or exceeds the amount
necessary to pay for all work done and not previously paid for or to be done in connection with the
completion of the improvements substantially in accordance with the Plans. The initial amounts of
the Reserves have been designated in this Agreement. The required amounts of said Reserves shall
decline as costs and payments for which they are maintained are paid therefrom; provided, however,
that the amount of any such Reserve shall never decline below an amount sufficient to pay all costs
and payments for which it is maintained which then remain unpaid, as determined by Lender. If any
Reserve becomes depleted, such depletion shall not limit Borrower’s obligation hereunder to pay all
sums which otherwise would have been payable from such Reserve.

Notwithstanding any provision of this Agreement or of the Disbursing Agreement to the contrary, in
the event that Lender or Borrower determines that the unadvanced balance of Loan proceeds is
insufficient to cover any cost allocation set forth on the Sworn Construction Cost Statement, or to
fully fund the Reserves, and/or to complete the Project and to pay all costs and

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expenses of Completion and, combined with Project income, to pay all costs to operate the Project,
to pay interest on the Loan, through the Maturity Date, and pay Total Project Costs, all as
reasonably determined by Lender, it shall notify the other party hereto of such determination, and
Borrower shall, within five (5) Business Days, deposit with Lender (or, if requested by Lender, the
Title Company) funds equal to said insufficiency in order to bring the Loan back into Balance.
Anything to the contrary contained in this Section 3.3 notwithstanding, in the event that Borrower
is required to deposit balancing funds with Lender hereunder and the Project is thereafter
completed with subsequent savings that, had they occurred prior to the requirement of the balancing
funds, would have rendered all or a portion of such deposit to be unnecessary, Borrower shall be
entitled to a reimbursement of the funds deposited equal to the lesser of (a) the amount such
subsequent savings or (b) the amount of the balancing funds deposit.

     In the event that Borrower generates cash through contributions to the capital of Borrower, or
through sale of any of the Land with the consent of the Lender (as required under Section 5.12 of
this Agreement), such cash shall be used, at the Lender’s option, to reduce the Principal Balance
owing under the Note.

Section 3.4 — Inspections

     Lender, the Title Company, the Inspecting Architect (if any), Consultants and their
representatives shall have access to the Project at all reasonable times and upon reasonable
advance notice, and shall have the right to enter the Project and to conduct such inspections
thereof as they shall deem necessary or desirable for the protection of Lender’s interests.

     Lender may retain an Inspecting Architect, and any other Consultants reasonably deemed
necessary or desirable by Lender, at Borrower’s expense, to make periodic inspections of the
Project and to review all change orders relating to the Project. Lender may request the Inspecting
Architect, before any Advance of Loan proceeds is made, to inspect all work and materials for
which payment is requested and all other work upon the Project, review the current draw request,
approve such work and draw request and/or submit to Lender a progress inspection report. Lender
may also retain such other Consultants as Lender reasonably deems necessary or convenient to
perform such services as may, from time to time, be required by Lender in connection with the
Loan, this Agreement, the other Loan Documents or the Project. Lender may waive any or all of
these requirements in writing.

     Neither Borrower nor any third party shall have the right to use or rely upon the reports of
the Inspecting Architect or any other reports generated by Lender or its Consultants for any
purpose whatsoever, whether made prior to or after commencement of construction, unless Lender
gives its prior written consent to such reliance. Borrower shall be responsible for making its own
inspections of the Project during the course of construction and shall determine to its own
satisfaction that the work done and materials supplied are in accordance with applicable contracts
with its contractors. By advancing funds after any inspection of the Project by Lender or the
Inspecting Architect, Lender shall not be deemed to have waived any Event of Default or right to
require construction defects to be corrected, or to have acknowledged that all construction
conforms with the Plans.

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     Notwithstanding any provision of this Agreement or of the Disbursing Agreement to the
contrary, in the event that Lender should reasonably determine that the actual quality or value of
the work performed or the materials furnished does not substantially correspond with the quality or
value of the work required by the Plans, Lender shall notify Borrower of its objections thereto,
and, upon demand, Borrower shall correct the conditions to which Lender objects.

Section 3.5 — Lender Responsibility

     It is expressly understood and agreed that Lender assumes no liability or responsibility for
the sufficiency of the Loan proceeds to complete the Project, for protection of the Project, for
the satisfactory completion of the Project, for inspection during construction, for the adequacy of
Reserves, for the adequacy or accuracy of the Sworn Construction Cost Statement, for any
representations made by Borrower, or for any acts on the part of Borrower or its contractors to be
performed in the construction of the Project.

IV. REPRESENTATIONS AND WARRANTIES OF BORROWER

     While this Agreement is in effect, and until Lender has been paid in full the principal and
interest on the Advance made by Lender hereunder and under the other Loan Documents, Borrower
represents and warrants to Lender that:

Section 4.1 — Legal Status of Borrower

     Borrower is a Delaware limited liability company duly organized and validly existing under the
laws of the State of Delaware, and has all power, authority, permits, consents, authorizations and
licenses necessary to carry on its business, to construct, equip, own and operate the Project and
to execute, deliver and perform this Agreement and the other Loan Documents; all resolutions of the
members and/or managers of the Borrower necessary to authorize the execution, delivery and
performance of this Agreement and of the other Loan Documents which have been or are to be executed
by and on behalf of Borrower have been duly obtained and are in full force and effect; this
Agreement and such other Loan Documents have been duly authorized, executed and delivered by and on
behalf of Borrower so as to constitute the valid and binding obligations of Borrower, enforceable
in accordance with their terms; and Borrower has complied with all applicable assumed and/or
fictitious name requirements in Delaware and Kansas, and is qualified to do business as a limited
liability company in Kansas.

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Section 4.2 — Legal Status of HSRE

     HSRE-CAMPUS CREST I, LLC (HSRE) is a Delaware limited liability company duly organized and
validly existing under the laws of the State of Delaware, and has all power, authority, permits,
consents, authorizations and licenses necessary to carry on its business, and all resolutions of
the members and/or managers of HSRE necessary to authorize the execution, delivery and performance
of this Agreement and of the other Loan Documents which have been or are to be executed by and on
behalf of HSRE have been duly obtained and are in full force and effect; this Agreement and such
other Loan Documents have been duly authorized, executed and delivered by and on behalf of HSRE.

Section 4.3 — Legal Status of Campus Crest Ventures III, LLC

     Campus Crest Ventures III, LLC (Ventures) is a Delaware limited liability company duly
organized and validly existing under the laws of the State of Delaware, and has all power,
authority, permits, consents, authorizations and licenses necessary to carry on its business, and
all resolutions of the members and/or managers of Ventures necessary to authorize the execution,
delivery and performance of this Agreement and of the other Loan Documents which have been or are
to be executed by and on behalf of Ventures have been duly obtained and are in full force and
effect; this Agreement and such other Loan Documents have been duly authorized, executed and
delivered by and on behalf of Ventures.

Section 4.4 — Legal Status of Campus Crest Properties, LLC

     Campus Crest Properties, LLC (Properties) is a Delaware limited liability company duly
organized and validly existing under the laws of the State of Delaware, and has all power,
authority, permits, consents, authorizations and licenses necessary to carry on its business, and
all resolutions of the members and/or managers of Properties necessary to authorize the execution,
delivery and performance of this Agreement and of the other Loan Documents which have been or are
to be executed by and on behalf of Properties have been duly obtained and are in full force and
effect; this Agreement and such other Loan Documents have been duly authorized, executed and
delivered by and on behalf of Properties.

Section 4.5 — Title

     The Borrower is the owner, in fee simple, of the Land, subject to no lien, charge, mortgage,
restriction or encumbrance, except Permitted Encumbrances. The Borrower acknowledges that the
Lender is relying upon the disclosure of encumbrances in the Lender’s pro forma and final title
policy identified in Exhibit B, and Borrower has reviewed and confirms the encumbrances
and exceptions as set forth therein are the only encumbrances and exceptions known to Borrower.

Section 4.6 — No Breach of Applicable Agreements or Laws

     The consummation of the transactions contemplated hereby and the execution, delivery and/or
performance of this Agreement and the other Loan Documents will not result in any breach of or
constitute a default under any mortgage, deed of trust, lease, bank loan, credit

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agreement, or other instrument or violate any Governmental Requirements, to which Borrower is a
party, or by which Borrower may be bound or affected.

Section 4.7 — No Litigation or Defaults

     There are no actions, suits or proceedings pending or, to the knowledge of Borrower,
threatened against or affecting Borrower or the Project, or involving the validity or
enforceability of the Loan Documents or the priority of the lien thereof, at law or in equity; and
Borrower is not in default under any order, writ, injunction, decree or demand of any court or any
administrative body having jurisdiction over Borrower.

Section 4.8 — Financial and Other Information

     The financial statements of Borrower and the Guarantors each previously or hereafter
delivered to Lender fairly and accurately present, or will fairly and accurately present, the
financial condition of Borrower and the Guarantors and each of them as of the dates of such
statements, including without limitation all contingent liabilities and guaranties by such parties
of third party obligations, and neither this Agreement nor any document, financial statement,
financial or credit information, certificate or statement referred to herein or furnished to
Lender by Borrower or the Guarantors or any of them contains, or will contain, any untrue
statement of a material fact or omits, or will omit, a material fact, or is or will be misleading
in any material respect.

     Borrower warrants that there has been no deterioration in the financial condition of Borrower
since January 26, 2009, and that the financial information submitted to Lender by Borrower is
accurate and complete in all material respects. Borrower agrees to notify Lender of any event
which has, or with the passage of time, could cause an adverse change in the financial condition
of the Borrower so long as any indebtedness hereunder remains unpaid.

Section 4.9 — No Defaults Under Loan Documents or Other Agreements

     There is, and, until the Lender has been fully repaid the entire indebtedness evidenced or to
be evidenced by the Note, there will be, no default or Event of Default on the part of Borrower, or
any Affiliate, or the Guarantors or any of them under the Loan Documents, or under any other
material document to which Borrower, or any Affiliate, or the Guarantors or any of them may be a
party and which relates to the ownership, occupancy, use, development, construction or management
of the Project; and neither Borrower nor any Affiliate or Guarantor is or will be, in default in
the payment of principal or interest on any of their respective indebtedness for borrowed money, or
is, or will be, in default under any instrument or agreement under and subject to which any
indebtedness for borrowed money has been issued or is secured; and no event has occurred, or will
occur, which, with the lapse of time or the giving of notice or both, would constitute an event of
default thereunder.

Section 4.10  — Boundary Lines; Conformance with Governmental Requirements
and Restrictions

     The exterior lines of the Improvements are, and at all times will be, within the boundary
lines of the Land, and Borrower has examined and is familiar with all applicable covenants,

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conditions, restrictions and reservations, and with all applicable Governmental Requirements,
including but not limited to building codes and zoning, environmental, hazardous substance, energy
and pollution control laws, ordinances and regulations affecting the Project, and the Project will
in all material respects conform to and comply with said covenants, conditions, restrictions,
reservations and Governmental Requirements.

Section 4.11  — Loan in Balance

     The Loan is in Balance, or, if not, Borrower is prepared to deposit with Lender, promptly
upon demand by Lender, sufficient funds to bring the Loan in Balance.

Section 4.12 — Anti-Terrorism

     Neither Borrower, nor the Guarantors, nor any of the Borrower’s respective constituents or
affiliates nor any of the respective agents of such Borrower, constituents or Affiliates acting or
benefiting in any capacity in connection with the Loan (individually a “Borrower Party” and
collectively, the “Borrower Parties”) is in violation of any laws relating to terrorism or money
laundering, including but not limited to, Executive Order No. 13224 on Terrorist Financing,
effective September 23, 2001 (the “Executive Order”), as amended from time to time, and the U.S.
Bank Secrecy Act of 1970, as amended by the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, and as otherwise
amended from time to time (collectively, with the Executive Order, “Anti-Terrorism Law”).

     No action, proceeding, investigation, charge, claim, report, or notice has been filed,
commenced, or threatened against any Borrower Party alleging any violation of any Anti-Terrorism
Law.

     No Borrower Party has, after due investigation and inquiry, knowledge or notice of any fact,
event, circumstance, situation, or condition which could reasonably be expected to result in (a)
any action, proceeding, investigation, charge, claim, report, or notice being filed, commenced, or
threatened against any of them alleging any violation of, or failure to comply with, any
Anti-Terrorism Law; or (b) the imposition of any civil or criminal penalty against any of them for
any failure to so comply.

     No Borrower Party is a “Prohibited Person.” A Prohibited Person means any of the following:
(a) a person or entity that is listed in the Annex to, or is otherwise subject to the provisions
of, the Executive Order; (b) a person or entity owned or controlled by, or acting for or on behalf
of, any person or entity that is listed in the Annex to, or is otherwise subject to the provisions
of, the Executive Order; (c) a person or entity with whom Lender is prohibited from dealing or
otherwise engaging in any transaction by any Anti-Terrorism Law; (d) a person or entity who or that
commits, threatens, or conspires to commit or supports “terrorism” as defined in the Executive
Order; or (e) a person or entity that is named as a “specially designated national and blocked
person” on the most current list published by the U.S. Treasury Department Office of Foreign Asset
Control at its official web site or any replacement website or other replacement official
publication of such list.

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     Borrower has provided Lender with sufficient information (including names, addresses, and
where applicable, jurisdiction of formation or organization) to reasonably permit Lender to verify
the foregoing.

     No Borrower Party: (a) conducts any business or engages in making or receiving any
contribution of funds, goods, or services to or for the benefit of any Prohibited Person; (b)
deals in, or otherwise engages in any transaction relating to, any property or interests in
property blocked under the Executive Order; or (c) engages in or conspires to engage in any
transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to
violate, any of the prohibitions set forth in any Anti-Terrorism Law.

V. COVENANTS OF BORROWER

     While this Agreement is in effect, and until the Lender has been paid in full the principal
of and interest on the Advance made by the Lender hereunder and under the other Loan Documents:

Section 5.1 — Completing Construction

     Construction of the Project shall commence not later than the Construction Commencement Date.
Except as otherwise authorized in writing by the Lender, Borrower shall not become a party to any
contract, including the General Contractor’s construction contract, for the performance of any work
on the Project or for the supplying of any labor, materials or services for the construction of the
Improvements that varies in cost from that set forth in the Budget, except upon such terms and with
such parties as shall be approved in writing by Lender. Borrower agrees to furnish Lender, upon
request therefor, the names of contractors, subcontractors, materialmen and suppliers at any time
having any contract, or performing any work, or furnishing any material in connection with the
development and construction and shall also furnish Lender upon request copies of all applicable
contracts. No approval by Lender of any contract or change order shall make Lender responsible for
the adequacy, form or content of such contract or change order. Borrower shall expeditiously
complete and fully pay for the development and construction of the Project in a good and
workmanlike manner and in accordance with the contracts, subcontracts and Plans submitted to and
approved by Lender, and in compliance with all applicable Governmental Requirements, and any
covenants, conditions, restrictions and reservations applicable thereto, so that Completion of the
Improvements occurs on or before the Completion Date. Borrower assumes full responsibility for the
compliance of the Plans and the Project with all Governmental Requirements and with sound building
and engineering practices, and, notwithstanding any approvals by Lender, Lender shall have no
obligation or responsibility whatsoever for the Plans or any other matter incident to the Project
or the construction of the Improvements. Borrower shall correct or cause to be corrected (a) any
defect in the Improvements, (b) any departure in the construction of the Improvements from the
Plans or Governmental Requirements, and (c) any encroachment by any part of the Improvements or any
other structure located on the Land on any building line, easement, property line or restricted
area. Borrower shall cause all roads necessary for the utilization of the Project for its intended
purposes to be completed and dedicated (if dedication thereof is required by any governmental
authority), the bearing capacity of the soil on the Land to be made sufficient to support the
Improvements, and sufficient local utilities to be made available to the

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Project and installed at costs (if any) set out in the Sworn Construction Cost Statement, on or
before the Completion Date.

Section 5.2 — Changing Costs, Scope or Timing of Work

     Borrower shall deliver to Lender revised, sworn statements of estimated costs of the Project,
showing changes in or variations from the original Sworn Construction Cost Statement, involving
amounts of $10,000.00 or more, as soon as such changes are known to Borrower. Borrower shall
deliver to Lender a revised construction schedule, if and when the target completion date set
forth therein has been delayed by ten (10) consecutive days or more, or when the aggregate of all
such delays equals thirty (30) days or more.

     Borrower shall not make or consent to any change or modification in such Plans, contracts or
subcontracts, and no work shall be performed with respect to any such change or modification,
without the prior written consent of Lender, if such change or modification would in any material
way alter the design or structure of the Project or change the rentable area thereof in any way,
or increase or decrease the Project cost by $50,000.00 or more for any single change or
modification, or if the aggregate amount of all changes and modification exceeds $100,000.00.
Borrower shall promptly furnish Lender with copies of all changes or modifications in the Plans,
contracts or subcontracts for the Project, as approved by Lender, prior to incorporation of any
such change or modification into the Project, whether or not Lender’s consent to such change
or modification is required hereby.

Section 5.3 — Balancing the Loan

     The Borrower shall furnish to the Lender, as and when required by the Lender, at the Lender’s
option: (a) satisfactory evidence of the Borrower’s ability to pay all unpaid costs of completing,
leasing-up and operating the Project through the Maturity Date, and/or (b) cash equal to any
difference between such unpaid costs and the proceeds of the Loan which have not yet been advanced
hereunder, which shall be held and advanced by the Lender pursuant to the terms hereof.

Section 5.4 — Paying Costs of Project and Loan

     The Borrower shall pay and discharge, when due, all taxes, assessments and other governmental
charges upon the Project, as well as all claims for labor and materials which, if unpaid, might
become a lien or charge upon the Project; provided, however, that the Borrower shall have the right
to contest the amount, validity and/or applicability of any of the foregoing in strict accordance
with the terms of the Mortgage.

     The Borrower shall also pay all costs and expenses of the Lender and the Borrower in
connection with the Project, the Total Project Costs as defined herein, and the preparation and
review of the Loan Documents and the making, closing, administration, repayment and/or transfer of
the Loan, including but not limited to Loan and Carrying Charges, the reasonable fees of the
Lender’s attorneys, reasonable fees of the Inspecting Architect, if any, title insurance costs,
disbursement expenses, appraisal costs, and fees of environmental consultants, and all other costs
and expenses payable to third parties incurred by the Lender or the Borrower in

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connection with the Loan. Such costs and expenses shall be so paid by the Borrower whether or not
the Loan is fully advanced or disbursed.

Section 5.5 — Using Loan Proceeds

     The Borrower shall use the Loan proceeds solely to pay, or to reimburse the Borrower for
paying, costs and expenses shown on the Budget and the Sworn Construction Cost Statement approved
by the Lender, and incurred by the Borrower in connection with the development of the Land, the
construction of the Improvements on the Land and the equipping of the Improvements, together with
other expenses set forth on the Sworn Construction Cost Statement approved by the Lender together
with the Loan and Carrying charges and such incidental costs and expenses relating thereto as may
be approved from time to time in writing by the Lender. The Borrower shall take all steps
reasonably necessary to require similar use of Loan proceeds by its contractors and
subcontractors. The Borrower shall comply with the limitations on all Advances as set out in
Article III.

Section 5.6 — Keeping of Records

     The Borrower shall set up and maintain accurate and complete books, accounts and records
pertaining to the Project in a manner acceptable to the Lender and to the Disbursing Agent. The
Borrower will permit representatives of the Lender, the Inspecting Architect and the Disbursing
Agent to have free access to and to inspect and copy all such books, records and contracts of
Borrower, upon reasonable advance written notice to Borrower. Any such inspection by the Lender
and/or the Inspecting Architect shall be for the sole benefit and protection of the Lender, and
the Lender, may, but shall have no obligation to, disclose the results thereof to the Borrower or
to any third party.

Section 5.7 — Providing Financial Information

     The Borrower shall furnish or cause to be furnished such financial information concerning
the Borrower, any Affiliate, any Guarantor, and the Project as the Lender may reasonably request,
and shall furnish to the Lender: (a) a current operating statement for the Borrower and annual
financial statement (including a balance sheet and a statement of any contingent liabilities) for
the Borrower and any Guarantor within one hundred twenty (120) days following the end of each for
calendar year; (b) copies of the federal income tax returns (with all supporting schedules) of
Borrower and any Guarantor due during the term of the Loan within fifteen (15) days after the
deadline for filing the same; and (c) annual cash flow statements covering all of the Borrower’s
properties, including but not limited to the Project, within one hundred twenty (120) days
following the end of each fiscal year of the Borrower. All such financial statements shall be in
reasonable detail, shall be prepared in accordance with accounting principles consistently applied,
shall be certified by the party to which they apply as true, correct and complete. Borrower
expressly grants Lender the right to communicate directly with the Borrower’s accountants and
hereby authorizes such accountants to communicate directly with Lender.

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Section 5.8 — Providing Updated Surveys

     Upon completion of the Improvements, and at such other times as Lender may deem appropriate,
the Borrower shall furnish to the Lender a certified survey of the Project, evidencing that the
Improvements are constructed within the property lines of the Land, do not encroach upon any
easement affecting the Land and do comply with all applicable Governmental Requirements relating
to the location of Improvements, along with a letter from the Title Company or an endorsement to
the Title Policy, at the Lender’s option, confirming the acceptability of said survey.

Section 5.9 — Providing Evidence of Completion

     Upon Completion of the Improvements, and prior to the final Advance of Loan proceeds to pay
for hard costs of construction of the Project, including but not
limited to any retainage therefor,
and as a condition of the same, the Borrower shall furnish the Lender with all items required to
evidence Completion, including but not limited to a Certificate of Substantial Completion and
Certificate of Occupancy, such additional evidence of zoning compliance as the Lender may require,
including a final, certified Project “as-built” survey; certification from the Borrower and
General Contractor that the Project has been completed in accordance with the approved Plans; the
evidence of insurance required by Section 5.10 hereof; if requested by Lender, copies of all
warranties covering roofing systems, materials, equipment and appliances included within the
Project; copies of all licenses and permits required for operation of the Project; and photographs
of the completed Improvements.

Section 5.10 — Maintaining Insurance Coverage

     Borrower shall, at all times until Lender has been fully repaid all indebtedness evidenced by
the Note, this Agreement and any other Loan Document, maintain, or cause to be maintained, in
effect (and shall furnish to Lender copies of), insurance policies, as required under the terms of
Exhibit E attached hereto, and shall furnish to Lender proof of payment of all premiums
for such insurance.

Section 5.11 — Operating Agreements

     Borrower will not enter into, amend or terminate any development, leasing (not intended to
apply to the leases with tenants), management, or other similar agreement unless (a) the agreement
is terminable upon 30 days’ prior notice, and (b) Lender provides its prior written consent. In no
event shall such agreements provide that the foreclosure, sale or other change in ownership,
possession or control of the Project will result in a change of terms in such agreement adverse to
Lender or to the owner of the Project.

Section 5.12 — Transferring, Conveying or Encumbering the Project or Member Interest
in Borrower

     Except as specified in the Mortgage or in this Agreement, the Borrower shall not voluntarily
or involuntarily agree to, cause, suffer or permit: (a) any sale, transfer or conveyance or
divestiture of title, whether by operation of law or otherwise, of any interest of the Borrower,

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legal or equitable, in the Project or any part or portion thereof (other than permitted Leases and
as otherwise expressly permitted herein); (b) any mortgage, pledge, encumbrance or lien to be
imposed or remain outstanding against the membership interest held by the member in the Borrower;
or (c) any mortgage, pledge, encumbrance or lien to be imposed or remain outstanding against the
Project except a mechanics’ or materialmans’ lien which is not released or bonded against within
sixty days of service of the lien upon the Borrower, or otherwise dealt with in a manner
satisfactory to Lender, or any security interest to exist therein except as created by the Loan
Documents, and except Permitted Encumbrances, without, in each instance, the prior written consent
of the Lender. The entity currently serving as the sole member of Borrower shall continue to serve
in such capacity unless Lender agrees to the addition of a new member and/or withdrawal of the
existing member (which consent will not be unreasonably withheld).

Section 5.13 — Complying with the Loan Documents and Other Documents

     The Borrower shall comply with and perform all of its agreements and obligations under the
Loan Documents and under all other contracts and agreements to which the Borrower is a party
relating to the ownership, occupancy, use, development, construction or management of the Project,
and shall comply with all requests by the Lender which are consistent with the terms thereof.

Section 5.14 — Payments to a Member of Borrower

     Until Completion, Borrower agrees that Borrower shall not make any payment in whole or partial
satisfaction of any indebtedness, if any, owed by Borrower to a member of Borrower, or pay
dividends or other distributions, other than for income tax purposes in amounts for taxes arising
from the Project only, in respect of, or otherwise redeem any membership interests in Borrower.

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Section 5.15 — Developer’s Fees

     Until Completion, the Borrower agrees that the Borrower shall not receive developer fees in
respect of services relating to the development of the Project.

Section 5.16
— Existence and Identity — Campus Crest at Lawrence, LLC

     Borrower shall preserve and maintain its present existence as a limited liability company
under the laws of the State of Delaware and shall remain qualified as a limited liability company
authorized to do business in Kansas, and all of its rights, privileges and franchises, and
continue its business as presently conducted. Borrower shall not change the legal format under
which it was organized, materially amend its Certificate of Formation or Limited Liability Company
Agreement, or change its state of organization or chief executive office, without the prior
written consent of the Lender, nor shall Borrower cease to do business or engage in any line of
business materially different from that presently engaged in by the Borrower.

Section 5.17 — Maintaining Separateness of Borrower

     For the purpose of this Section, the word “Person” shall include an individual, corporation,
limited liability company, partnership, trust, unincorporated association, government, governmental
authority, and any other entity. Borrower has not and so long as any Loan indebtedness is
outstanding Borrower will not, (i) engage in any business or activity other than the ownership,
operation and maintenance of the Project, and activities incidental thereto; (ii) acquire or own
any assets other than (a) the Project, and (b) such incidental personal property as may be
necessary for the operation of the Project; (iii) merge into or consolidate with any Person, or
dissolve, terminate, liquidate in whole or in part, transfer or otherwise dispose of all or
substantially all of its assets or change its legal structure; (iv) fail to observe all
organizational formalities, or fail to preserve its existence as an entity duly organized, validly
existing and in good standing (if applicable) under the applicable laws of the jurisdiction of its
organization or formation, or materially amend or modify, terminate or fail to comply with the
material provisions of its organizational documents; (v) own any subsidiary, or make any investment
in, any Person; (vi) commingle its assets with the assets of any other Person; (vii) incur any
debt, secured or unsecured, direct or contingent (including guaranteeing any obligation), other
than the indebtedness under this Agreement and the Loan Documents, unsecured trade payables and
unsecured equipment leases (both of which must be incurred in the ordinary course of business
relating to the ownership and operation of the Project,) provided the same (y) do not exceed at any
time in the aggregate a maximum amount of three percent (3%) of the outstanding principal amount of
the Note, and (z) are paid within sixty (60) days after the date incurred; (viii) fail to maintain
its records, books of account, bank accounts, financial statements, accounting records and other
entity documents separate and apart from those of any other Person; (ix) enter into any contract or
agreement with any general partner, member, shareholder, principal or affiliate, except upon terms
and conditions that are intrinsically fair and substantially similar to those that would be
available on an arm’s-length basis with unaffiliated third parties; (x) maintain its assets in such
a manner that it will be costly or difficult to segregate, ascertain or identify its individual
assets from those of any other Person; (xi) assume or guaranty the debts of any other Person, hold
itself out to be responsible for the debts of any other Person, or otherwise pledge its assets for
the benefit of any other Person or hold out its credit as being available to satisfy the
obligations of any other Person; (xii) make any loans or

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payments on obligations not yet incurred or not yet due to any Person; (xiii) fail to file
its own tax returns (unless prohibited by law from doing so); (xiv) fail either to hold itself out
to the public as a legal entity separate and distinct from any other Person or to conduct its
business solely in its own name or fail to correct any known misunderstanding regarding its
separate identity; (xv) fail to maintain adequate capital for the normal obligations reasonably
foreseeable in a business of its size and character and in light of its contemplated business
operations; (xvi) fail to allocate shared expenses (including, without limitation, shared office
space) and to use separate invoices and checks; (xvii) fail to pay its own liabilities (including,
without limitation, salaries of its own employees) from its own funds; and (xviii) acquire
obligations or securities of its partners, members, shareholders or other affiliates, as
applicable.

Section 5.18 — Banking Relationship

     Borrower agrees to maintain all operating accounts with respect to the Project with Lender
during the life of the Loan.

Section 5.19 — Anti-Terrorism

     The Borrower shall not (a) conduct any business or engage in making or receiving any
contribution of funds, goods, or services to or for the benefit of any Prohibited Person; (b) deal
in, or otherwise engage in any transaction relating to, any property or interests in property
blocked pursuant to the Executive Order or any other Anti-Terrorism Law; or (c) engage in or
conspire to engage in any transaction that evades or avoids, or has the purpose of evading or
avoiding, or attempts to violate, any of the prohibitions set forth in any Anti-Terrorism Law; (d)
be or become subject at any time to any law, regulation or list of any government agency
(including, without limitation, the U.S. Office of Foreign Asset Control list) that prohibits or
limits Lender from making any advance or extension of credit to Borrower or from otherwise
conducting business with Borrower, or (e) fail to provide documentary and other evidence of
Borrower’s identity as may be requested by Lender at any time to enable Lender to verify Borrower’s
identity or to comply with any applicable law or regulation, including, without limitation, Section
326 of the USA Patriot Act of 2001, 31 U.S.C. Section 5318.

     Borrower agrees promptly to deliver to Lender (but in any event within ten (10) days of
Lender’s written request) any certification or other evidence requested from time to time by Lender
in its reasonable discretion, confirming Borrower’s compliance with the foregoing.

VI. DEFAULTS

Section 6.1 — Events of Default

     Any of the following events shall constitute an Event of Default under this Agreement:

	 	A.	 	Borrower shall default in the payment of principal or interest due according
to the terms hereof or of the Note, and such default shall continue for ten (10) days
beyond the date on which such payment is due;
	 
	 	B.	 	Borrower fails to pay any fees or other amounts payable to Lender under this
Agreement (including but not limited to Loan and Carrying Charges and the fee

24

 

	 	 	 	payable pursuant to Section 1.5 hereof), under the Note or under any of the other
Loan Documents, and such default shall continue for ten (10) days beyond the date on which
such payment is due;

	 	C.	 	Borrower shall default in the performance or observance of any other agreement,
covenant or condition required to be performed or observed by the Borrower
under the terms of this Agreement or other Loan Document, and such default
shall not be waived by the Lender, including without limitation attempted
avoidance of waivers contained herein, and such default shall continue for thirty
(30) days after the date of written notice thereof from the Lender to the
Borrower, unless such default cannot be cured within such thirty (30) day period
with diligent efforts and the Borrower has been diligently pursuing a cure
thereof;
	 
	 	D.	 	Any representation or warranty made by the Borrower in this Agreement, in any
of the other Loan Documents, or in any certificate or document furnished under
the terms of this Agreement or in connection with the Loan, shall be untrue or
incomplete in any material respect, and such untrue or incomplete representation
or warranty in the reasonable judgment of the Lender, could be expected to or
does have a material adverse effect on the Project, the Borrower or the
Borrower’s performance under the Loan Documents;
	 
	 	E.	 	Work on the Project shall be substantially abandoned, or shall, by reason of the
Borrower’s fault, be unreasonably delayed or discontinued for a period of ten
(10) days, or construction shall be delayed for any reason whatsoever to the
extent that completion of the Project cannot, in the judgment of the Lender, be
accomplished prior to the Completion Date;
	 
	 	F.	 	Lender determines that the remaining undisbursed Loan proceeds are insufficient
to fully pay all of the then unpaid costs of the Project and estimated expenses of
completion and (combined with Project income) the costs of operation through
the Maturity Date (including the Reserves), and the Borrower (i) fails to deposit
with the Lender, within 5 business days after written demand, sufficient funds to
permit the Lender to pay said excess costs as the same become payable, or (ii)
does not pay said excess costs directly and deliver to the Lender unconditional
mechanics’ lien waivers therefor (or paid receipts for non-lienable items), at the
Lender’s option;

	 	G.	 	Completion shall not have occurred on or before the Completion Date;
	 
	 	H.	 	Borrower or any member of Borrower shall commit an act of bankruptcy; or shall apply for,
consent to or permit the appointment of a receiver, custodian, trustee or liquidator for it
or any of its property or assets; or shall fail to, or admit in writing its inability to, pay
its debts as they mature; or shall make a general assignment for the benefit of creditors or
shall be adjudicated bankrupt or insolvent; or shall take other similar action for the
benefit or protection of its creditors; or shall give notice to any governmental body of
insolvency or pending

25

 

	 	 	 	insolvency or suspension of operations; or shall file a voluntary petition in
bankruptcy or a petition or an answer seeking reorganization or an arrangement
with creditors, or to take advantage of any bankruptcy, reorganization,
insolvency, readjustment of debt, rearrangement, dissolution, liquidation or other
similar debtor relief law or statute; or shall file an answer admitting the
material allegations of a petition filed against it in any proceeding under any
such law or statute; or shall be dissolved, liquidated, terminated or merged; or
shall effect a plan or other arrangement with creditors; or a trustee, receiver,
liquidator or custodian shall be appointed for it or for any of its property or
assets and shall not be discharged within sixty (60) days after the date of his
appointment; or a petition in involuntary bankruptcy, reorganization or similar
proceedings is filed against it and is not dismissed within sixty (60) days after
the date of its filing;

	 	I.	 	Any Guarantor defaults under the terms of the Guaranty, or takes any action to
revoke or terminate the Guaranty or any liability or security in favor of the
Lender under the Guaranty;

Section 6.2 — Rights and Remedies

     Upon the occurrence and continuance of an Event of Default, and until such time as such Event
of Default is subsequently waived in writing by the Lender, the Lender shall be entitled, at the
option of the Lender, to exercise any or all of the following rights and remedies, consecutively
or simultaneously, and in any order:

	 	A.	 	The Lender may declare the entire unpaid principal balance of the Advances
made under this Agreement to be immediately due and payable, together with accrued
and unpaid interest on such Advances, all without notice to or demand on the
Borrower or any Guarantor.
	 
	 	B.	 	The Lender may exercise any or all remedies specified herein and in the other
Loan Documents, including (without limiting the generality of the foregoing) the
right to foreclose the Mortgage and/or any other remedies which it may have
therefor at law, in equity or under statute.
	 
	 	C.	 	The Lender may cure the Event of Default on behalf of the Borrower, and, in
doing so, may enter upon the Project, and may expend such sums as it may deem
desirable, including reasonable attorneys’ fees, all of which shall be deemed to be
Advances hereunder, even though causing the Loan to exceed the face amount of
the Note, shall bear interest at the Default Rate provided herein and shall be
payable by the Borrower on demand.

Section 6.3 — Force Majeure

     The Completion Date shall be extended for a period of time equal to the number of days during
which the Borrower is prevented from proceeding with the construction of the Improvements by
reason of Force Majeure, provided that (i) there is no default under the Loan Documents that has
not been cured within any applicable grace or cure period, and (ii) Borrower notifies the Lender
of the events constituting such Force Majeure within 15 days after they occur.

26

 

If the Completion Date is extended by reason of Force Majeure pursuant to the provisions of this
paragraph and if subsequent to such extension Borrower makes up all or a portion of such Force
Majeure delay, such extension of the Completion Date shall be reduced by the number of days
Borrower is able to make up after the occurrence of such Force Majeure delay.

Section 6.4 — Completion of Project by Lender

     In addition, in case of the occurrence of an Event of Default specified in Section 6.1 hereof,
or any Event of Default caused by, or which results in, the Borrower’s failure, for any reason, to
continue with construction of the Project as required by this Agreement, then the Lender may (but
shall not be obligated to), in addition to, or in concert with, the other remedies referred to
above, take over and complete construction of the Project in accordance with the Plans, with such
changes therein as the Lender may, in its discretion, deem appropriate, all at the risk, cost and
expense of the Borrower. The Lender may assume or reject any contracts entered into by the Borrower
in connection with the Project, may enter into additional or different contracts for work,
services, labor and materials required, in the judgment of the Lender, to complete the Project, and
may pay, compromise and settle all claims in connection with the Project. All sums, including
reasonable attorneys’ fees, and charges or fees for supervision and inspection of the construction
and for any other necessary or desirable purpose in the discretion of the Lender expended by the
Lender in completing or attempting to complete the Project (whether aggregating more, or less, than
the face amount of the Note), shall be deemed Advances made by the Lender to the Borrower
hereunder, and the Borrower shall be liable to the Lender, on demand, for the repayment of such
sums, together with interest on such sums from the date of their expenditure at the rates provided
herein. The Lender may, in its discretion, at any time abandon work on the Project, after having
commenced such work, and may recommence such work at any time, it being understood that nothing in
this Section 6.4 shall impose any obligation on the Lender either to complete or not to complete
the Project. For the purpose of carrying out the provisions of this Section, the Borrower
irrevocably appoints the Lender its attorney-in-fact, with full power of substitution, to execute
and deliver all such documents, to pay and receive such funds, and to take such action as may be
necessary, in the judgment of the Lender, to complete the Project. This power of attorney is
coupled with an interest and is irrevocable. The Lender, however, shall have no obligation to
undertake any of the foregoing, and, if the Lender does undertake any of the same, it shall have no
liability for the adequacy, sufficiency or completion thereof.

VII. MISCELLANEOUS

Section 7.1 — Binding Effect; Waivers; Cumulative Rights and Remedies

     The provisions of this Agreement shall inure to the benefit of and be binding upon the parties
hereto and their respective heirs, executors, administrators, personal representatives, legal
representatives, successors and permitted assigns; provided, however, that neither this Agreement
nor the proceeds of the Loan may be assigned by the Borrower voluntarily, by operation of law or
otherwise, without the prior written consent of the Lender and compliance with the terms hereof.
This Agreement expressly applies to any letters of credit issued by Lender in connection with the
Loan or the Project. No delay on the part of Lender in exercising any right, remedy, power or
privilege hereunder shall operate as a waiver thereof, nor shall any single

27

 

or partial exercise of any right, remedy, power or privilege hereunder constitute such a
waiver or exhaust the same, all of which shall be continuing. The rights and remedies of the
Lender specified in this Agreement shall be in addition to, and not exclusive of, any other rights
and remedies which the Lender would otherwise have at law, in equity or by statute, and all such
rights and remedies, together with the Lender’s rights and remedies under the other Loan
Documents, are cumulative and may be exercised individually, concurrently, successively and in any
order. The Borrower waives, to the maximum extent permitted by law, its rights under any statutory
provision or common law rule under which the Borrower has any right to avoid or recover any
attorney fees or costs or any other fees or costs required or contemplated under this Agreement,
or in fact paid, and Borrower further agrees that the payment of same at closing or otherwise
shall be deemed a full waiver, release, and accord and satisfaction of any such claims.

Section 7.2 — Survival

     All agreements, representations and warranties made in this Agreement shall survive the
execution of this Agreement, the making of all Advances by the Lender, and the execution of the
other Loan Documents, and shall continue until the Lender receives payment in full of all
indebtedness of the Borrower incurred under this Agreement and under the other Loan Documents.

Section 7.3 — Continued Cooperation of Borrower

     Borrower shall, from time to time, upon Lender’s written request, execute, deliver, record
and furnish such documents as Lender may reasonably deem necessary or desirable, to (a) perfect
and maintain perfected the liens granted by the Borrower to Lender under the Mortgage and the
other Loan Documents, (b) correct any errors of a typographical nature which may be contained in
any of the Loan Documents, or (c) consummate fully the transaction contemplated under this
Agreement.

Section 7.4 — Indemnification

     In addition to any and all rights of reimbursement, indemnification, subrogation or any other
rights pursuant hereto or under law or equity, the Borrower hereby agrees (to the extent permitted
by law) to indemnify and hold harmless the Lender and its respective officers, directors, employees
and legal counsel (the “Indemnitees”) from and against any and all claims, damages, losses,
liabilities, reasonable costs or expenses whatsoever (including reasonable attorneys’ fees and
court costs) which any of the Indemnitees may incur (or which may be claimed against any of the
Indemnitees by any person or entity whatsoever) by reason of or in connection with (a) the
execution and delivery or transfer of, or payment or failure to pay under the Loan Documents; (b)
the use of the proceeds of the Loan; (c) any breach by the Borrower of any representation,
warranty, covenant, term or condition in, or the occurrence of any default by the Borrower under
this Agreement or the other Loan Documents; (d) involvement of the Lender in any legal suit,
investigation, proceeding, inquiry or action as a consequence, direct or indirect, of the Lender’s
making of the Loan, the approval of any disbursements, the Lender entering into this Agreement or
action taken thereunder or under any of the Loan Documents or any other event or transaction in
connection with or contemplated by any of the foregoing; or (e) the construction of the Project by
the Borrower or any other person; provided that, the Borrower

28

 

shall not be required to indemnify the Lender that such claims, damages, losses, liabilities,
costs or expenses were the result of the gross negligence or willful misconduct of the Lender. If
any proceeding shall be brought or threatened against an Indemnitee by reason of or in connection
with the events described in clause (a), (b), (c), (d), or (e), the applicable Indemnitee shall
promptly notify the Borrower in writing and the Borrower shall assume the defense thereof,
including the employment of counsel chosen by the Borrower with the reasonable consent of the
Indemnitee and the payment of all costs of litigation. Notwithstanding the preceding sentence,
each of the Indemnitees shall have the right to employ their own respective counsel and to
determine their own defense of such action in any such case, but the fees and expenses of such
counsel shall be at the expense of Indemnitee unless (i) the employment of such counsel shall have
been authorized in writing by the Borrower or (ii) the Borrower, after due notice of the action,
shall not have employed counsel reasonably satisfactory to such Indemnitee to have charge of such
defense, in either of which events the reasonable fees and expenses of the respective counsels for
such Indemnitee shall be borne by the Borrower to the extent that such action is covered by this
indemnification provision. The Borrower shall not be liable for any settlement of any such action
effected without its consent. Nothing under this Section is intended to limit the Borrower’s
payment of the Loan and Carrying Charges. The Borrower shall pay or reimburse the Indemnitees for
any and all amounts arising from or in connection with any of the events described in this Section
7.4 upon demand therefor by the Lender, accompanied by a written statement describing the matters
giving rise to such payment and the basis for computation of the amount so payable. Any amount
payable by the Borrower hereunder which is not paid within ten (10) Business Days following demand
shall bear interest at the default rate set forth in the Note.

     The obligations of the Borrower under this Section 7.4 shall survive the termination of this
Agreement, the Loan Documents and the payment of all indebtedness in connection with the Loan. The
Borrower’s liability hereunder shall not be conditioned or contingent upon the pursuit by the
Lender of any right or remedy against the Borrower or any other person at any time and shall not be
affected or limited in any manner by any action taken by the Lender in connection with exercise of
any remedies under the Loan Documents.

Section 7.5 — Governing Law; Waiver of Jury Trial

     This Agreement, the rights of the parties hereunder and the interpretation hereof shall be
governed by, and construed in accordance with, the laws of the State of Kansas, in all respects.
The Borrower hereby waives any right to a trial by jury in any action relating to the Loan and/or
the Loan Documents.

Section 7.6 — Counterparts

     This Agreement may be executed in any number of counterparts, all of which shall constitute a
single Agreement.

Section 7.7 — Notices

     Any notice demand, consent, approval, request, or other communication or document required or
permitted to be given by either party hereto to the other under the terms of this

29

 

Agreement, or documents related hereto, shall be deemed to have been given (i) three (3)
business days after the date the same is deposited in the United States Mail, registered or
certified, return receipt requested, postage prepaid, (ii) on the date the same is forwarded by
telefacsimile with proof of transmission (provided such telefacsimile notice is followed by one of
the other listed notice methods), or (iii) one (1) business day following deposit with a reputable
overnight courier providing a receipt for overnight delivery, addressed as follows:

	 	 	 

	If to Borrower:

	 	Campus Crest at Lawrence, LLC

2100 Rexford Road, Suite 414

Charlotte, NC 28211

Attn: Crystal A. Bowman
	 
	 	 
	with copy to:

	 	Harrison Street Real Estate Capital

71 South Wacker Drive, Suite 3585

Chicago, Illinois 60606

Attn: General Counsel
	 
	 	 
	with copy to:

	 	DLA Piper LLP (US)

203 North LaSalle Street, Suite 1900

Chicago, Illinois 60601-1293

Attn: Michael S. Gershowitz
	 
	 	 
	with copy to:

	 	Bradley Arant Boult Cummings LLP

One Federal Place 

1819 Fifth Avenue North 

Birmingham, Alabama 35203

Attn: Dawn Helms Sharff
	 
	 	 
	If to Lender:

	 	Mutual of Omaha Bank

3333 Farnam Street

Omaha, Nebraska 68131 

Attn: Sam Somerhalder
	 
	 	 
	with copy to:

	 	Smith, Gardner, Slusky,

Lazer, Pohren & Rogers, LLP

8712 West Dodge Road

Suite 400

Omaha, NE 68114

Attn: H. Daniel Smith

Each party may change its address for notice from time to time by delivering written notice as
above provided at least ten (10) days prior to the effective date of such change.

Section 7.8 — Lender’s Sign

     The Lender may, if it so desires, and subject to compliance with governmental requirements,
place a sign of reasonable size on the Land, indicating that the Lender is providing financing for
the Project (to be removed on or before the Completion Date), and/or Lender may otherwise publicize
its involvement with the Project, including but not limited to issuing press releases; provided
however, that any reference to Borrower’s sole member or the members of

30

 

Borrower’s sole member, shall be subject to Borrower’s written approval, and Lender shall not
disclose on such sign or in such press releases the specific terms of the Loan, including without
limitation, the interest rate, loan-to-value ratio, or other terms or underwriting criteria, but
not including any matter that is in the public record.

Section 7.9 — No Third Party Reliance

     No third party shall be entitled to rely upon this Agreement or to have any of the benefits
of the Lender’s interest hereunder, unless such third party is an express assignee of all or a
portion of the Lender’s interest hereunder.

Section 7.10 — Sale of Loan or Participations

     The Lender may arrange for other lenders to purchase, or participate with the Lender in, the
Loan, and the Lender shall be entitled to retain any compensation received from any such other
lender. The Lender may divulge all information received by it from the Borrower, any Guarantor, or
any other source, including but not limited to information relating to the Loan, to the Project
and to the Borrower, to any such other lender, and the Borrower shall cooperate with the Lender at
no expense to Borrower in satisfying the reasonable requirements of any such other lender for
consummating such a purchase or participation.

Section 7.11 — Time of the Essence

     Time is of the essence hereof with respect to the dates, terms and conditions of this
Agreement.

Section 7.12 — Entire Agreement; No Oral Modifications

     This Agreement, the other Loan Documents and the other documents mentioned herein set forth
the entire agreement of the parties with respect to the Loan and supersede all prior written or
oral understandings and agreements with respect thereto. No modification or waiver of any provision
of this Agreement shall be effective unless set forth in writing and signed by the parties hereto.
Oral agreements or commitments to loan money, extend credit or to forbear from enforcing repayment
of a debt including promises to extend or renew such debt are not enforceable. To protect the
Borrower and Lender from misunderstanding or disappointment, any agreement, promise, undertaking,
or offer to forebear repayment of money or to make any other financial accommodation in connection
with this Loan of money or grant or extension of credit, or any amendment of, cancellation of,
waiver of, or substitution for any or all of the terms or provisions of any instrument or document
executed in connection with this loan of money or grant or extension of credit, must be in writing
to be effective which is the complete and exclusive statement of the agreement between us, except
as we may later agree in writing to modify it. In addition the Lender gives the following statutory
notice: Statutory Notice. THIS LOAN AGREEMENT AND ALL OTHER LOAN DOCUMENTS CONSTITUTE THE
COMPLETE AND FINAL EXPRESSION OF THE AGREEMENT BETWEEN BORROWER AND LENDER WITH REGARD TO THE
EXTENSION OF CREDIT OR OTHER FINANCIAL ACCOMMODATION AND MAY NOT BE CONTRADICTED BY EVIDENCE OF ANY
PRIOR ORAL AGREEMENT OR OF ANY CONTEMPORANEOUS ORAL AGREEMENT BETWEEN BORROWER AND LENDER. BORROWER
AGREES THAT ALL NONSTANDARD TERMS OF THE AGREEMENT BETWEEN

31

 

BORROWER AND LENDER AND ALL PRIOR ORAL AGREEMENTS AND CONTEMPORANEOUS ORAL AGREEMENTS BETWEEN THEM
ARE SUFFICIENTLY SET FORTH IN THE DOCUMENTS EXCEPT AS FOLLOWS (IF NONE, STATE “NONE” OR LEAVE
BLANK):

NONE

BORROWER ALSO AGREES THAT THE ABOVE SPACE IS SUFFICIENT FOR THE DISCLOSURE OF TERMS AND AGREEMENTS
NOT SET FORTH IN THE LOAN DOCUMENTS. BY SIGNING THIS AGREEMENT, BORROWER AND LENDER AFFIRM THAT NO
UNWRITTEN ORAL AGREEMENT BETWEEN BORROWER AND LENDER WITH REGARD TO THE EXTENSION OF CREDIT OR
OTHER FINANCIAL ACCOMMODATION EXISTS.

Section 7.13 — Acknowledgement Respecting Property Insurance.

     Execution by Borrower of this Agreement constitutes acknowledgement of the following: WARNING:
Unless Borrower provides Lender with evidence of the insurance coverage as required by this
Agreement and the Loan Documents, Lender may purchase or cause to be purchased insurance at
Borrower’s expense to protect our interest. This insurance may, but need not, also protect
Borrower’s interest. If the collateral becomes damaged, the coverage Lender purchases may not pay
any claim Borrower makes or any claim made against Borrower. Borrower may later cancel this
coverage by providing evidence that Borrower has obtained property coverage elsewhere. Borrower is
responsible for the cost of any insurance purchased by Lender or its successor. The cost of this
insurance may be added to Borrower’s Loan balance. If the cost is added to Borrower’s Loan balance,
the interest rate on the underlying Loan will apply to this added amount. The effective date of
coverage may be the date Borrower’s prior coverage lapsed or the date Borrower failed to provide
proof of coverage. The coverage Lender or its successor purchases may be considerably more
expensive than insurance Borrower can obtain on its own and may not satisfy any need for property
damage coverage or any mandatory liability insurance requirements imposed by applicable law.

Section 7.14 — Captions

     The headings or captions of the Articles and Sections set forth herein are for convenience
only, are not a part of this Agreement and are not to be considered in interpreting this
Agreement.

Section 7.15 — Borrower-Lender Relationship

     The relationship between the Borrower and the Lender created hereby and by the other Loan
Documents shall be that of a borrower and a lender only, and in no event shall the Lender be deemed
to be a partner of, or a joint venturer with, the Borrower.

32

 

Section 7.16 — Power of Attorney

     Borrower does hereby make, constitute, and appoint Lender, its successors and assigns,
Borrower’s true and lawful attorney-in-fact, in Borrower’s name, place, and stead, or otherwise,
upon an Event of Default which remains uncured as described above and during the continuance
thereof, to do and perform all and every act and thing whatsoever which may be necessary or proper
to receive and enforce performance under this Loan Agreement and the other Loan Documents, and to
carry out and to give effect to this assignment and the powers herein granted, as fully and to all
intents and purposes as Borrower might or could do in the premises, including, but not limited to:

	 	(1)	 	To do all acts and to execute, acknowledge, obtain, and
deliver any and all instruments, documents, items, or things necessary,
proper, or required as a term, condition, or provision of this Agreement and
the other Loan Documents;
	 
	 	(2)	 	To give any notices, instructions, or other communications in
connection with this Agreement and the other Loan Documents;
	 
	 	(3)	 	To demand and receive all performance due under or with
respect to this Agreement and the other Loan Documents and to take all lawful
action for the enforcement thereof and to compromise and settle any claim or
cause of action of Borrower arising from or related to this Loan Agreement and
the other Loan Documents and give acquittances and other sufficient discharges
relating thereto; and
	 
	 	(4)	 	To file any claim or proceeding or to take any other action,
either in its own name or in that of its nominee, or in the name of Borrower,
or otherwise, to enforce the performance due under or related to this
Agreement and the other Loan Documents or protect and preserve the right,
title, and interest of Lender hereunder.

     This power of attorney is given in fulfillment of a condition precedent to disbursement of
funds under this Agreement, and is for the benefit and protection of Lender, its successors and
assigns. This power of attorney shall not impose upon Lender the obligation that it is for the
benefit and protection of any other persons. The power of attorney given herein, subject to the
occurrence of an Event of Default, is a power coupled with an interest and shall be irrevocable
until all of the Indebtedness is satisfied in full. Lender shall have no obligation to exercise any
of the foregoing rights and powers in any event.

[Signature Pages Follow]

33

 

     IN WITNESS WHEREOF, the parties have executed this Loan Agreement as of the day and year first
above written.

	 	 	 	 	 
	 	CAMPUS CREST AT LAWRENCE, LLC,

a Delaware limited liability company

 	 
	 	By:  	HSRE-Campus Crest I, LLC, a Delaware limited liability company, its member

 	 
	 	By:  	Campus Crest Ventures III, LLC, a Delaware limited liability company, a member

 	 
	 	By:  	Campus Crest Properties, LLC, a North

Carolina limited liability company, its

Manager

 	 
	 	By:  	/s/ Michael S. Hartnett
 	 
	 	 	Michael S. Hartnett 	 
	 	 	Its Manager 	 

 

 

	 	 	 	 	 
	 	MUTUAL OF OMAHA BANK, a federally chartered savings bank:

 	 
	 	By  	/s/ Sam Somerhalder, SCL
 	 
	 	 	Sam Somerhalder, Senior Commercial Lender 	 
	 	 	 	 
	 

Signature page to Construction Loan Agreement

Campus Crest at Lawrence, LLC

S-2 

 

EXHIBIT A

Land

Lot 1, Block 1, in LEGENDS ADDITION NO. 1, an Addition to the City of Lawrence, in Douglas
County, Kansas, according to the plat thereof filed in Plat Book 17 at Page 773.

TOGETHER WITH a 25’ access easement established by the plat of said subdivision.

Exhibit Page to Construction Loan Agreement

Campus Crest at Lawrence, LLC

E - 1

 

EXHIBIT B

Permitted Encumbrances

     None except those exceptions shown on Schedule B of the final Lender’s Policy issued by
Chicago Title Insurance Company, No. 020082055.

Exhibit Page to Construction Loan Agreement

Campus Crest at Lawrence, LLC

E - 2

 

EXHIBIT C

Description of Improvements

     A 172 unit, 500 bedroom student apartment consisting of 16 buildings with a Net Rentable
Area of approximately 210,095 SF and 531 on-site parking spaces. The buildings will be situated on
the Land consisting of an approximately 12.55 acre site.

Exhibit Page to Construction Loan Agreement

Campus Crest at Lawrence, LLC

E - 3

 

EXHIBIT D

TITLE INSURANCE REQUIREMENTS

	A.	 	As a pre-closing requirement, Borrower must submit a title insurance commitment or
preliminary title report, issued by a reputable, commercial title insurance company
acceptable to Lender, agreeing to issue an ALTA 10/17/92 form of loan policy of title
insurance, or such other form of loan policy as the Lender shall approve (the “Policy”), in the
amount of the Loan, insuring to the Lender and its assigns that:

	 	1.	 	The Borrower is the fee owner of the Land.
	 
	 	2.	 	The Mortgage is a first lien upon fee title to the Land and any improvements thereon
or to be erected thereon.
	 
	 	3.	 	The Land is free and clear of all other liens, charges and encumbrances not approved
by Lender.
	 
	 	4.	 	All possible contractor and supplier mechanic’s and materialmen’s lien claims, rights
of parties in possession and matters which could be shown by an adequate survey are
unconditionally insured against.

	B.	 	The commitment or report should be accompanied by complete copies of all recorded
instruments referred to therein.
	 
	C.	 	The commitment or report and Policy may not contain a “pending disbursements clause”.
	 
	D.	 	If commencement of construction is planned for a time prior to the recording of the
Mortgage, particular attention should be paid to obtaining the Title Company’s consent, since
the Lender will require insured priority of the Mortgage over all possible mechanic’s or
materialmen’s liens.
	 
	E.	 	The commitment or report and Policy shall include these endorsements (as applicable):

	 	1.	 	ALTA Form No.9 (Comprehensive).
	 
	 	2.	 	Zoning.
	 
	 	3.	 	Usury. If endorsement is unavailable, Lender requires opinion of Borrower’s local
counsel as to usury.
	 
	 	4.	 	Contiguity.
	 
	 	5.	 	Access.
	 
	 	6.	 	Survey.
	 
	 	7.	 	Planned Unit Development and Subdivision (if applicable).

Exhibit Page to Construction Loan Agreement

Campus Crest at Lawrence, LLC

E - 4

 

	 	8.	 	Doing Business.
	 
	 	9.	 	Mineral Rights (if applicable).
	 
	 	10.	 	Patent (if applicable).
	 
	 	11.	 	Creditor’s Rights and Arbitration.
	 
	 	12.	 	Tax parcel.
	 
	 	13.	 	Such other endorsements as the Lender may require.

	F.	 	The commitment must contain an agreement by the Title Company to waive the so-called
“Standard Exceptions” to the policy.

Exhibit Page to Construction Loan Agreement

Campus Crest at Lawrence, LLC

E - 5

 

EXHIBIT E

INSURANCE REQUIREMENTS

(Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to them
on the Loan Agreement to which this Exhibit is attached)

	I.	 	PROPERTY INSURANCE

A. During Construction

An ORIGINAL (or certified copy) Builder’s All-Risk (Special Form/Special Extended
Coverage), Completed Value, Non-Reporting Form POLICY naming Borrower as an insured,
reflecting coverage of 100% of the replacement cost of the Improvements and the Equipment,
and written by a carrier approved by the Lender with a current Best’s Insurance Guide rating of
at least A-IX (which is authorized to do business in the state where the Project is located) that
includes:

	 	1.	 	Mortgagee Clause (or equivalent) naming Lender.
	 
	 	2.	 	30-day notice to Lender in the event of cancellation, non-renewal or material change.
	 
	 	3.	 	Replacement Cost Endorsement.
	 
	 	4.	 	Stipulated Value Endorsement.
	 
	 	5.	 	Flood Insurance (if applicable).
	 
	 	6.	 	Vandalism and Malicious Mischief Coverage.

B. Upon Completion

An ORIGINAL (or certified copy) All-Risk (Special Form/Special Extended Coverage) Hazard
Insurance POLICY naming Borrower as an insured, reflecting coverage of 100% of the
replacement cost of the Improvements and the Equipment, and written by a carrier approved by
Lender with a current Best’s Insurance Guide Rating of at least A-IX and a current Standard
and Poor claims paying ability rating of A (which is authorized to do business in the state where
the Project is located) that includes:

	 	1.	 	Lender’s Loss Payable Endorsement with a Severability of Interest Clause.
	 
	 	2.	 	30-day notice to Lender in the event of cancellation, non-renewal or material change.
	 
	 	3.	 	Replacement Cost Endorsement.
	 
	 	4.	 	Stipulated Value.
	 
	 	5.	 	Boiler Explosion Coverage (if applicable).

Exhibit Page to Construction Loan Agreement

Campus Crest at Lawrence, LLC

E - 6

 

	 	6.	 	Sprinkler Leakage Coverage.
	 
	 	7.	 	Vandalism and Malicious Mischief Coverage.
	 
	 	8.	 	Flood Insurance (if applicable).

II. LIABILITY INSURANCE

An
ORIGINAL CERTIFICATE or other evidence (e.g. an ACORD 27 certificate) of
Comprehensive Public Liability Insurance naming Borrower as an insured, and written by a
carrier approved by Lender with a current Best’s Insurance Guide Rating of at least A-IX
(which is authorized to do business in the state where the Project is located that includes:

1. $3 million combined single limit coverage.

2. Additional Insured Endorsement naming Lender.

3. 30-day notice to Lender in the event of cancellation, non-renewal or material change.

III. WORKER’S COMPENSATION

An ORIGINAL CERTIFICATE of Worker’s Compensation coverage in the statutory
amount, naming Borrower as owner of the Project, written by a carrier approved by Lender.

IV. OTHER

     All insurance provided for in this Exhibit shall be effected under a valid and enforceable
policy or policies of insurance in form and substance approved by Lender, shall be issued by
insurers
of recognized responsibility, which are licensed to do business in the state where the Project is
located, and which are acceptable to Lender, and shall be satisfactory to Lender in all other
respects.

     All hazard and casualty insurance policies maintained by Borrower pursuant to the foregoing
provisions in this Exhibit shall: (i) provide that any losses payable thereunder shall (pursuant to
a standard first mortgagee clause in favor of, and acceptable to, Lender, to be attached to each such
policy) be payable to Lender and assigns; (ii) include effective waivers by the insurer of all
claims
for insurance premiums against Lender; (iii) provide that any losses shall be payable
notwithstanding
(a) any act of negligence by Borrower or Lender; (b) any foreclosure or other
proceedings or notice
of sale relating to the Land, (c) any waiver of subrogation rights by the insured, or (d) any
change in
the title to or ownership of any of the Land, and (iv) be written in amounts sufficient to prevent
Borrower from becoming a co-insurer under said policies. All liability insurance policies
maintained
by Borrower pursuant to this Exhibit shall name Lender as an additional insured and shall waive
contribution from any other insurance carried by Lender in the event of loss. Borrower shall cause
the originals or certified copies of the policies of all such insurance to be deposited with Lender
or to
be otherwise held as directed by Lender. At least fifteen (15) days prior to the date on which the
premiums on each such policy shall become due and payable, Borrower shall furnish Lender with
proof satisfactory to Lender of payment thereof. Each of such policies shall contain an agreement by
the insurer that the same shall not be amended, modified, canceled, reduced or terminated for any
reason, including but not limited to a failure to pay premiums and/or expiration by its terms,
without

Exhibit Page to Construction Loan Agreement

Campus Crest at Lawrence, LLC

E - 7

 

at least thirty (30) days’ prior written notice to Lender. If the Mortgage is foreclosed or
otherwise
sold, the purchaser at the foreclosure or other sale shall, after the expiration of any statutory
period
of redemption, become the sole and absolute owner of any and all such policies, with the sole right
to collect and retain all unearned premiums thereon, and, for this purpose, Borrower hereby assigns
and grants a security interest in said policies and unearned premiums
to Lender, provided that, the
provisions of this sentence shall not apply to coverage for occurrences and claims arising prior to
the
expiration of such statutory period of redemption.

Exhibit Page to Construction Loan Agreement

Campus Crest at Lawrence, LLC

E - 8

 

EXHIBIT F

Budget — (Exhibit A to Commitment)

REPLACE WITH BUDGET

Exhibit Page to Construction Loan Agreement

Campus Crest at Lawrence, LLC

E - 9exv10w53

Exhibit
10.53

CONSTRUCTION LOAN AGREEMENT

BETWEEN

CAMPUS CREST AT HUNTSVILLE, LP, 
a Delaware limited partnership

AND

AMEGY MORTGAGE COMPANY, L.L.C. d/b/a Q-10 Amegy Mortgage Capital,

a Texas limited liability company

Loan No. 99-10-71154

 

 

Table of Contents

	 	 	 	 	 	 	 

	ARTICLE I: DEFINITIONS	 	 	1	 
	1.01

	 	Advance
	 	 	1	 
	1.02

	 	Application for Advance
	 	 	1	 
	1.03

	 	Appraisal
	 	 	1	 
	1.04

	 	Approved Budget
	 	 	1	 
	1.05

	 	Assignment of Construction Contracts
	 	 	2	 
	1.06

	 	Assignment of Permits and Licenses
	 	 	2	 
	1.07

	 	Assignment of Purchase Contracts
	 	 	2	 
	1.08

	 	Assignment of Rights to Plans and Specifications
	 	 	2	 
	1.09

	 	Availability of Utilities Letter
	 	 	2	 
	1.10

	 	Borrower’s Equity
	 	 	2	 
	1.11

	 	Closing Date
	 	 	2	 
	1.12

	 	Completion Date
	 	 	2	 
	1.13

	 	Compliance Letter
	 	 	2	 
	1.14

	 	Construction Contract
	 	 	3	 
	1.15

	 	Contractor
	 	 	3	 
	1.16

	 	Current Survey
	 	 	3	 
	1.17

	 	Deed of Trust
	 	 	3	 
	1.18

	 	Depository Bank
	 	 	3	 
	1.19

	 	Design Professional
	 	 	3	 
	1.20

	 	Engineering Reports
	 	 	3	 
	1.21

	 	Event of Default
	 	 	3	 
	1.22

	 	Force Majeure
	 	 	4	 
	1.23

	 	Governmental Authority
	 	 	4	 
	1.24

	 	Governmental Requirements
	 	 	4	 
	1.25

	 	Guarantor
	 	 	4	 
	1.26

	 	Guaranty Agreement
	 	 	5	 
	1.27

	 	Improvements
	 	 	5	 
	1.28

	 	Inspecting Engineers
	 	 	5	 
	1.29

	 	Inspection Certificate
	 	 	5	 
	1.30

	 	Land
	 	 	5	 
	1.31

	 	Letters of Credit
	 	 	5	 
	1.32

	 	Loan
	 	 	5	 
	1.33

	 	Loan Documents
	 	 	5	 
	1.34

	 	Master Plan
	 	 	5	 
	1.35

	 	Note
	 	 	5	 
	1.36

	 	Operating Account
	 	 	6	 
	1.37

	 	Phases
	 	 	6	 
	1.38

	 	Plans
	 	 	6	 
	1.39

	 	Property
	 	 	6	 
	1.40

	 	Purchase Contracts
	 	 	6	 
	1.41

	 	Supervision Professional
	 	 	6	 
	1.42

	 	TCEQ
	 	 	6	 
	1 43

	 	Title Company
	 	 	6	 
	1.44

	 	Title Insurance Policy
	 	 	6	 
	1.45

	 	Title Underwriter
	 	 	6	 
	1.46

	 	Other Terms
	 	 	6	 

i 

 

	 	 	 	 	 	 	 

	ARTICLE II: ADVANCES BY LENDER	 	 	6	 
	2.01

	 	Use of Loan Proceeds
	 	 	6	 
	2.02

	 	Procedure for Advances
	 	 	7	 
	2.03

	 	Requirements for Subsequent Advances
	 	 	10	 
	2.04

	 	Conditions to Subsequent Advances
	 	 	11	 
	2.05

	 	Completion of Improvements
	 	 	12	 
	2.06

	 	No Waiver
	 	 	12	 
	2.07

	 	Conditions Precedent for the Benefit of Lender
	 	 	13	 
	2.08

	 	Subordination
	 	 	13	 
	2.09

	 	Operating Account
	 	 	13	 
	2.10

	 	Letters of Credit
	 	 	13	 
	ARTICLE III: REPRESENTATIONS AND WARRANTIES OF BORROWER	 	 	14	 
	3.01

	 	Representations and Warranties
	 	 	14	 
	3.02

	 	Survival of Representations and Warranties
	 	 	16	 
	3.03

	 	Inducement to Lender
	 	 	16	 
	ARTICLE IV: COVENANTS AND AGREEMENTS OF BORROWER	 	 	16	 
	4.01

	 	Compliance with Governmental Requirements
	 	 	16	 
	4.02

	 	The Construction Contract
	 	 	16	 
	4.03

	 	Construction of the Improvements and Supervision
	 	 	17	 
	4.04

	 	Correction of Construction Defects
	 	 	17	 
	4.05

	 	Storage of Materials
	 	 	17	 
	4.06

	 	Inspection of the Property
	 	 	17	 
	4.07

	 	Notices by Governmental Authority, Fire and Casualty Losses, Etc.
	 	 	17	 
	4.08

	 	Application of Advances
	 	 	17	 
	4.09

	 	Direct Disbursement and Application by Lender
	 	 	17	 
	4.10

	 	Costs and Expenses
	 	 	18	 
	4.11

	 	Change Orders
	 	 	18	 
	4.12

	 	No Liability of Lender
	 	 	18	 
	4.13

	 	No Conditional Sale Contracts, Etc.
	 	 	18	 
	4.14

	 	Defense of Action
	 	 	18	 
	4.15

	 	Assignment of Construction Contract
	 	 	18	 
	4.16

	 	Assignment of Plans
	 	 	19	 
	4.17

	 	Payment of Claims
	 	 	20	 
	4.18

	 	Inspections
	 	 	20	 
	4.19

	 	Indemnity
	 	 	21	 
	4.20

	 	Lender’s Action for its Own Protection Only
	 	 	21	 
	ARTICLE V: RIGHTS AND REMEDIES OF LENDER	 	 	22	 
	5.01

	 	Rights of Lender
	 	 	22	 
	5.02

	 	Cessation of Advances
	 	 	22	 
	5.03

	 	Funds of Lender
	 	 	22	 
	5.04

	 	No Waiver or Exhaustion
	 	 	22	 
	ARTICLE VI: GENERAL TERMS AND CONDITIONS	 	 	22	 
	6.01

	 	Notices
	 	 	23	 
	6.02

	 	Entire Agreement and Modifications
	 	 	23	 
	6.03

	 	Severability
	 	 	23	 
	6.04

	 	Election of Remedies
	 	 	23	 
	6.05

	 	Form and Substance
	 	 	23	 
	6.06

	 	No Third Party Beneficiary
	 	 	23	 
	6.07

	 	Borrower In Control
	 	 	23	 

ii 

 

	 	 	 	 	 	 	 

	6.08

	 	Number and Gender
	 	 	23	 
	6.09

	 	Captions
	 	 	23	 
	6.10

	 	Applicable Law
	 	 	23	 
	6.11

	 	Multiple Counterparts
	 	 	24	 

Exhibits:

Exhibit “A” — Description of Land

Exhibit “B-1” — Draw Request

Exhibit “B-2” — Draw Request Certification

Exhibit “B-3” — AIA Form of Application of Advance

Exhibit “B-4” — Contractor Draw Certification

Exhibit “C-l” — Initial Approved Budget

Exhibit “C-2” — Budget Revision Request Form

Exhibit “C-3” — Budget Revision Request Certification

Exhibit “D-1” — Assignment of Builder Takedown Contracts (Intentionally Omitted)

Exhibit “D-2” — Assignment of Construction Contracts

Exhibit “D-3” — Assignment of Unit Purchase Contract (Intentionally Omitted)

Exhibit “D-4” — Assignment of Right of Reimbursement (District Receivables) (Intentionally Omitted)

Exhibit “D-5” — Assignment of Rights to Plan and Specifications

Exhibit “E” — Form of Compliance Letter

Exhibit “F” — Affidavit of Commencement

Exhibit “G-1” — Partial Waiver and Release of Lien

Exhibit “G-2” — Final Waiver and Release of Lien

Exhibit “H” — Affidavit and Certificate of Completion

Exhibit “I-1” — Affidavit of Bills Paid

Exhibit “I-2” — Owner’s Affidavit of Bills Paid

Exhibit “J” — List of Tenant Leases (Intentionally Omitted)

iii 

 

CONSTRUCTION LOAN AGREEMENT

     THIS CONSTRUCTION LOAN AGREEMENT (“Agreement”) dated June 12, 2009 is made by and between
AMEGY MORTGAGE COMPANY, L.L.C. d/b/a Q-10 Amegy Mortgage Capital, a Texas limited liability
company (“Lender”), and CAMPUS CREST AT HUNTSVILLE, LP, a Delaware limited partnership
(“Borrower”).

     Borrower has applied to Lender for a loan for the purposes hereinafter described concerning
the Land (hereinafter defined) described on Exhibit “A” attached hereto and made a part
hereof for all purposes; and Lender is willing to make such loan upon the terms and conditions
herein set forth in consideration of the mutual covenants and agreements herein contained, Borrower
and Lender agree as follows:

ARTICLE I: DEFINITIONS

     For purposes of this Agreement, the following terms shall have the respective meanings
assigned to them.

     1.01 Advance. The term “Advance” shall mean a disbursement by Lender of any of the
proceeds of the Loan.

     1.02 Application for Advance. The term “Application for Advance” shall mean a
written application by Borrower (and such other parties as Lender may require) to Lender
utilizing (i) the Draw Request form, a copy of which is attached hereto as Exhibit
“B-l”, (ii) the Draw Request Certification to be signed by Borrower, a copy of which is
attached hereto as Exhibit “B-2”. (iii) the American Institute of Architects’ Forms
G-702 and G-703, copies of which are attached hereto as Exhibit “B-3” and (iv) the
Contractor Draw Request Certification to be signed by the Contractor, a copy of which is
attached hereto as Exhibit “B-4”] and if requested by Lender, a Contractor’s Affidavit
of Bills Paid described in Section 2.05(b), all accompanied by such schedules, certificates,
affidavits, releases, waivers, statements, invoices, bills, and other documents as Lender may
reasonably request.

     1.03 Appraisal. The term “Appraisal” shall mean a written appraisal of the Land and
Improvements in form and substance and prepared by an appraiser acceptable to Lender. The
Appraisal shall comply and be in conformity with the regulatory requirements for federally
chartered national banks.

     1.04
Approved Budget. The term “Approved Budget” shall mean a budget or cost
itemization prepared by Borrower and approved by Lender specifying the cost by item of (a) Land
acquisition or refinance and closing costs related thereto, (b) all labor, materials, and
services necessary for the construction of the Improvements in accordance with the Plans and all
Governmental Requirements, and (c) all other expenses anticipated by Borrower incident to the
development of the Property, and the construction of Improvements. The Approved Budget will show
total costs of all items and proposed allocation of Advances and Borrower’s Equity to such
items. The initial Approved Budget is attached hereto as Exhibit “C-l” and incorporated
herein by reference. The Approved Budget may be amended by Borrower, from time to time, with the
prior written consent of Lender, which consent will not be unreasonably withheld or delayed. It
is contemplated by Borrower and Lender that the Approved Budget shall be amended, as
construction of the Improvements is undertaken by Borrower and Loan proceeds are used for
payment of portions of the cost of construction. In connection with said amendments, Borrower
shall have the right to reallocate savings and/or surplus on a particular line item of the
Approved Budget to one or more other line items without Lender’s prior written consent; provided
that any use of the “Contingency” line item shall require Lender’s prior approval. A copy of the
Budget Revision Request Form and Budget Revision Request Certification to be

 

 

utilized by Borrower for amendment of the Approved Budget are attached hereto as Exhibit
“C-2” and Exhibit “C-3”, respectively. Lender hereby agrees not to unreasonably
withhold its consent to any budget line item reallocation request and to use good faith efforts to
respond to any such request within five (5) Business Days after Borrower’s request,

     1.05 Assignment of Construction Contracts. The term “Assignment of Construction
Contracts” shall collectively mean one or more collateral assignments in the form attached hereto
as Exhibit “D-2” and incorporated herein for all purposes, executed by Borrower and
acknowledged by the general contractor, assigning the construction contract with the general
contractor to Lender.

     1.06 Assignment of Permits and Licenses. The term “Assignment of Permits and Licenses”
shall mean a collateral assignment in form and substance acceptable to Lender, executed by
Borrower to Lender, assigning all permits, licenses and other agreements affecting the Property
and/or necessary or desirable for the ownership, use and operation thereof, as and if same shall
come into existence.

     1.07 Assignment of Purchase Contracts. [Intentionally deleted.]

     1.08 Assignment of Rights to Plans and Specifications. The term “Assignment of Rights
to Plans and Specifications” shall mean a collateral assignment in form attached hereto as
Exhibit “D-5” and incorporated herein for all purposes of Borrower’s rights with respect
to the Plans, duly executed by Borrower and acknowledged by Design Professional.

     1.09 Availability of Utilities Letter. The term “Availability of Utilities Letter”
shall mean a letter or letters or other evidence, in form and substance acceptable to Lender, to
be completed by parties acceptable to Lender certifying that the Property, when the Improvements
are completed, will have adequate rights and means of access to all water, storm and sanitary
sewer facilities, gas, cable t.v., telephone, and electric service necessary for the intended use
of the Property and adequate pedestrian and vehicular access to one or more dedicated public
streets.

     1.10 Borrower’s Equity. The term “Borrower’s Equity” shall mean the amount of
Borrower’s
cash equity investment in the Land and the Improvements as reasonably
calculated from time to time by Lender. Borrower’s Equity shall be at least equal to the total
cost shown on the Approved Budget less the proceeds of the Loan, but will in no event be less
than $7,191,000.00. The amount of Borrower’s Equity required may be increased in the event
additional funding is required pursuant to the terms of Section 2.02 of this Agreement.

     1.11 Closing Date. The term “Closing Date” shall mean the date of the execution and
delivery of this Agreement by Borrower and Lender.

     1.12 Completion Date. The term “Completion Date” shall mean eighteen months from the
effective date hereof, or such earlier date on which Borrower is required to deliver space to
tenants under any lease agreements.

     1.13 Compliance Letter. The term “Compliance Letter” shall mean a letter to be
delivered to Lender upon approval of the Plans, and at any time that there shall be a change or
modification in the Plans, in form or substance satisfactory to Lender, completed by the Design
Professional, certifying that the Improvements, when completed as designed, including such changes
and modifications, will be in compliance with all applicable Governmental Requirements of each
Governmental Authority having jurisdiction over the Property [including but not limited to Section
404 of the Federal Clean Water Act,] and in compliance with

2

 

the conditions which must be satisfied to maintain any permits for the Improvements. An
acceptable form of Compliance Letter is attached hereto as Exhibit “E” and made a part
hereof for all purposes.

     1.14 Construction Contract. The term “Construction Contract” shall mean all
contracts executed between Borrower and each Contractor for the rendering of services or
furnishing of materials in connection with the completion of Improvements.

     1.15 Contractor. The term “Contractor” shall mean each “original contractor” (as
defined in Section 53.001 of the Texas Property Code, as amended from time to time), with whom
Borrower contracts for the construction of any of the Improvements or any other work with respect
to the Property. All Contractors under any Construction Contract exceeding ten percent (10%) of
the amount of the Approved Budget shall be bonded with payment and performance bonds in accordance
with Lender’s reasonable requirements unless waived by Lender based upon Lender’s review of the
Contractor’s financial condition. The term “Contractor” shall not include CAMPUS CREST
CONSTRUCTION, LLC.

     1.16 Current Survey. The term “Current Survey” shall mean an on-the ground survey of
the Land (and Improvements, if applicable) dated within ninety days of the date such survey is
required to be furnished pursuant to any provision of this Agreement, performed by a surveyor duly
licensed as such in the State of Texas, in form and substance acceptable to Lender and Title
Company such that the Title Company may amend the Title Insurance Policy under procedural rule P-2
to delete the standard pre-printed exception concerning areas and boundary, save “shortages in
area”.

     1.17 Deed of Trust. The term “Deed of Trust” shall mean the deed of trust securing the
payment of the Note and the payment and performance of all obligations specified in said deed of
trust and this Agreement, and evidencing a valid and enforceable first priority lien on the
Property.

     1.18 Depository Bank. The term “Depository Bank” shall mean Amegy Bank National
Association.

     1.19 Design Professional. The term “Design Professional” shall mean the architect,
designer, draftsman, engineer or other professional selected by the Borrower and approved in
writing by Lender, who is responsible for the creation of the Plans.

     1.20 Engineering Reports. The term “Engineering Reports” shall mean all soil analysis
reports, construction and mechanical feasibility reports and plans and such other reports of
engineers and others regarding improvement and site development of the Land as shall be reasonably
required by Lender.

     1.21 Event of Default. The term “Event of Default” shall mean:

	 	(a)	 	A default under or failure by Borrower to comply with any of
the terms or conditions, or breach of any covenant or warranty specified
herein or in any other Loan Document and the expiration of any cure period as
follows: (i) ten (10) days after notice from Lender, for any default under any
term, covenant or condition of any of the Loan Documents (excepting the
default for failure to pay the Debt as described in subsection 10(a) of the
Security Instrument) which default can be cured by the payment of a sum of
money and (ii) thirty (30) days after notice from Lender in the case of any
other default, provided that if such default cannot reasonably be cured within
such thirty (30) day period and Borrower shall have commenced to cure such
default within such thirty (30) day period and thereafter diligently and

3

 

	 	 	 	expeditiously proceeds to cure the same, such thirty (30) day period shall
be extended for so long as it shall require Borrower in the exercise of due
diligence to cure such default, it being agreed that no such extension
shall be for a period in excess of sixty (60) days;
	 
	 	(b)	 	The cessation of the construction of the Improvements for more
than thirty (30) consecutive days (excluding Force Majeure events) without the
written consent of Lender;
	 
	 	(c)	 	A failure of any of the materials supplied for the
construction of the Improvements to comply with the Plans or any Governmental
Requirements and such failure is not cured within thirty (30) days after
written notice from Lender of such default;
	 
	 	(d)	 	A reasonable determination by Lender that construction of the
Improvements will not be completed on or before the Completion Date.

     Notwithstanding anything contained herein to the contrary, Borrower shall have all grace
periods and notice and curative rights as provided in the Note prior to Lender declaring an Event
of Default; provided however, during any such grace periods and notice and curative rights
periods, Lender shall have no obligation to make Advances.

     1.22 Force Majeure. The term “Force Majeure” shall mean occurrence beyond the control
of the party affected, including, but not limited to, acts of God or
of the public enemy;
expropriation or confiscation of facilities or property; compliance with any order or request of
any Governmental Authority or person purporting to act therefor, adversely affecting the supply,
availability or use of materials or labor; acts of war, public disorders, rebellion, sabotage,
fires, explosions, floods, storms, or breakdowns; riots, strikes or other concerted acts of
workmen, whether direct or indirect, or any other causes whether or not of the class or kind
specifically named above, not within the reasonable control of the party affected and which, by
the exercise of reasonable diligence, said party is unable to prevent or avoid; provided, however,
that any claim for an extension of time or excused non-performance as a result of such occurrence
shall be made by written notice to Lender, claiming such extension or excused non-performance and
delivered not more than thirty days after the commencement of such occurrence.

     1.23 Governmental Authority. The term “Governmental Authority” shall mean the United
States of America, the State, the County, the TCEQ, the City, Municipal Utility District, Road
Utility District, or any other political subdivision in which the Property is located, and any
other political subdivision, agency, district, department, commission, board, bureau, court or
instrumentality which now or hereafter has jurisdiction or extra territorial jurisdiction over
Lender, Borrower, Contractor or any part of the Property (including, but not limited to, platting,
zoning, utilities and site development or construction on the Property).

     1.24 Governmental Requirements. The term “Governmental Requirements” shall mean all
applicable laws, ordinances, orders, rules, and regulations of any Governmental Authority
applicable to Borrower or the Property.

     1.25 Guarantor. The term “Guarantor” shall mean TED W. ROLLINS, MICHAEL S. HARTNETT,
TXG, LLC, a South Carolina limited liability company, MADEIRA GROUP, LLC, a North Carolina limited
liability company, MXT CAPITAL, LLC, a Delaware limited liability company, CAMPUS CREST GROUP,
LLC, a North Carolina limited liability company, CAMPUS CREST DEVELOPMENT, LLC, a North Carolina
limited liability company, CAMPUS CREST CONSTRUCTION, LLC, a North

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Carolina limited liability company, THE GROVE STUDENT PROPERTIES, LLC, a North Carolina limited
liability company, and CAMPUS CREST PROPERTIES, LLC, a North Carolina limited liability company.

     1.26 Guaranty Agreement. The term “Guaranty Agreement” shall mean any guaranty
agreement executed by the Guarantors from time to time, to guarantee payment of the Loan and
performance of the Loan Documents.

     1.27 Improvements. The term “Improvements” shall mean all site and building
improvements (including, but not limited to, the clearing, grading, paving, and appurtenances
directly related thereto), buildings, utility improvements, drainage improvements, landscaping,
amenities, infrastructures and all other facilities and on-site and off-site improvements to the
Property, the construction of which is required to properly develop the Land in accordance with
the Master Plan, the Plans and the Approved Budget.

     1.28 Inspecting Engineers. The term “Inspecting Engineers” shall mean the inspecting
or consulting engineers or other third party inspectors retained by Lender for the purpose of
making the inspections contemplated hereunder.

     1.29 Inspection Certificate. The term “Inspection Certificate” shall mean a
certificate issued by the Inspecting Engineers approving, among other matters, soils test, Plans
(including, without limitation, systems, structural details, and compliance with any local, state
or federal laws), construction cost breakdown, progress schedules and contracts with the
Contractor and major subcontractors.

     1.30 Land. The term “Land” shall mean the land described on Exhibit “A” attached
hereto and incorporated herein by reference for all purposes.

     1.31 Letters of Credit. The term “Letters of Credit” shall mean one or more standby
letters of credit issued by Depository Bank for the benefit of Borrower in favor of a Governmental
Authority or other beneficiary to assure completion of the development and furnishing of the
Property.

     1.32
Loan. The term “Loan” shall mean the financing evidenced by the Loan
Documents.

     1.33 Loan Documents. The term “Loan Documents” shall mean this Agreement, the Deed of
Trust, the Note, and such other instruments evidencing, securing, or pertaining to the Loan as
shall, from time to time, be executed and delivered by Borrower, any guarantor of the Loan, or any
other party, to Lender pursuant to this Agreement.

     1.34 Master Plan. The term “Master Plan” shall mean collectively, the various related
materials provided to the Lender by Borrower with regard to the construction of Improvements on
the Property. Such Master Plan shall include appropriate budgets, construction schedules, draw
schedules, plans, specifications, list of construction contracts, construction timeline and other
particulars, in form and content, as required by Lender. Any component of the Master Plan may be
amended from time to time by Borrower, upon Lender’s prior written consent. Except for the Initial
Advance, no Loan proceeds shall be advanced until Borrower submits and Lender approves the Master
Plan.

     1.35 Note. The term “Note” shall mean the promissory note from Borrower to Lender
dated of even date herewith in the amount of $13,355,000.00 and evidencing the Loan.

5

 

     1.36 Operating Account The term “Operating Account” shall mean an Operating Account
established by Borrower with Depository Bank which shall be the exclusive operating and deposit
account used by Borrower in connection with the Property.

     1.37 Phases. [Intentionally deleted.]

     1.38 Plans. The term “Plans” shall mean, if any, architectural, structural,
electrical, plumbing, heating, ventilation, air conditioning, sprinkler system, topography,
on-site utilities, off-site utilities, landscaping, road and parking plans and specifications, all
certified as such by the Design Professional, if any, preparing the same. The Plans shall be
approved in writing by Lender, and Borrower and, if applicable, all necessary Governmental
Authorities for the construction of the Improvements. With respect to any Plans for Improvements
costing more than $100,000.00, Lender reserves the right to have an independent architect or
engineer of its choice review the Plans so submitted and to provide a written report thereon to
Lender prior to the acceptance or rejection of the Plans by Lender, the cost of which shall be
borne by Borrower. Lender shall have the right to require reasonable changes in the Plans.

     1.39 Property. The term “Property” shall mean the Land together with the Improvements
and all other property constituting the “Property,” as described in the Deed of Trust.

     1.40 Purchase Contracts. [Intentionally deleted.]

     1.41 Supervision Professional. The term “Supervision Professional” shall mean the
architect, engineer, construction consultant or other third party selected by the Borrower and
approved in writing by Lender to supervise the construction of the Improvements on behalf of the
Borrower. Borrower is required to hire and direct the Supervision Professional until completion of
the Improvements. Lender hereby approves Campus Crest Group, LLC as the Supervision Professional
hereunder.

     1.42 TCEQ. The term “TCEQ” shall mean the Texas Commission on Environmental Quality
or its successors.

     1.43 Title Company. The term “Title Company” shall mean Chicago Title Insurance
Company.

     1.44 Title Insurance Policy. The term “Title Insurance Policy” shall mean the
mortgagee title insurance policy or title policy binder on interim construction, issued by the
Title Company, naming Lender as the insured party, in the amount of the Loan, insuring or
committing to insure that the Deed of Trust constitutes a valid first priority lien covering the
Property, and subject only to exceptions approved by Lender.

     1.45 Title Underwriter. The “Title Underwriter” shall mean Chicago Title Insurance
Company.

     1.46 Other Terms. Other terms used, but not defined, herein shall have the meaning
assigned to such term as provided in the Deed of Trust. The term “construction” as used herein
shall also include renovation of existing Improvements and the development of infrastructure
improvements of the Land.

ARTICLE II ADVANCES BY LENDER

     2.01 Use of Loan Proceeds. Advances shall be made from time to time at the request of
Borrower in accordance with the terms of this Agreement. Advances shall be made only for:

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	 	(a)	 	an “Initial Advance” at closing for costs of acquisition of the Property
(or for refinance of such acquisition costs) and for other items approved by
Lender and shown on the Approved Budget;
	 
	 	(b)	 	labor, materials (stored on the Property in accordance with the
requirements of this Agreement) and services for the construction of
Improvements on the Property approved by Lender and in accordance with the
Plans and the Approved Budget (the “Construction Allocation”); and
	 
	 	(c)	 	other items approved by Lender and shown on the Approved Budget
which may include costs associated with the development of the Property which
are not included in the Initial Advance and Construction Allocation such as
architectural and engineering fees, tenant improvements costs, interest,
property taxes, insurance, leasing commissions, title and recording fees, and
loan fees (the “Non Construction Allocation”).

     2.02 Procedure for Advances.

	 	(a)	 	Subject to the terms of this Agreement, the amount of each
Advance for the Construction Allocation shall not exceed a sum calculated by
multiplying the Construction Allocation portion of the Loan amount times the
percentage of completion of the Improvements less the total aggregate amount of
funds previously disbursed under such Loan for the Construction Allocation,
less applicable Retainage, provided however, that the total amount advanced
shall never exceed the original principal amount of the Note. Percentage of
completion of the Improvements shall be determined in the reasonably discretion
of the Lender.
	 
	 	(b)	 	Subject to the terms of this Agreement, the amounts available
for the Non Construction Allocation shall be advanced, but only to the extent
that such charges have been incurred, or that the Borrower is otherwise
entitled to payment on account of such items as provided for in the Approved
Budget or otherwise in accordance with the Loan Documents.
	 
	 	(c)	 	Each Application for Advance shall be made in writing, signed by
the Borrower, and shall be accompanied by a certificate prepared by the
Borrower, or at Lender’s election, Borrower’s Supervision Professional, which
certificate shall state the percentage of completion of the Improvements and the
services and/or materials to be paid for therefrom. Upon approval of such
certificate by the Lender, the Advance shall be made. Prior to approval by
Lender, the Lender shall be entitled to make any and all inspections and require
further documentation from Borrower, all as Lender may deem necessary in order
to substantiate and determine the percentage of completion of such Improvements.
Lender may retain, at Borrower’s cost, the Inspecting Engineers to complete said
inspections and to review the Master Plan and the Plans, prior to approval.
Borrower agrees to pay to the Lender the actual cost of each inspection made by
the Lender, its employees, agents, or contractors.
	 
	 	(d)	 	Advances shall be made after construction of the Improvements
(“Work”) has commenced and shall be made for Work done preceding the date of
request upon Lender’s receipt of an Affidavit of Commencement in the form
provided on Exhibit

7

 

	 	 	 	“F” attached hereto and made a part hereof for all purposes.
Application for Advance shall be filed no more often than twice monthly,
shall be filed at least ten working days before the date upon which an
Advance is desired, shall be certified by the Supervision Professional, if
any, and Borrower, and (if required by Lender) approved by the Inspecting
Engineers, shall specify which contractors, subcontractors/suppliers are
being paid out of said Advance and in what amounts, making reference to
specific line items on the Approved Budget, and shall contain such
information as Lender reasonably may request. Lender, at its discretion, may
require a Compliance Letter and/or an Inspection Certificate prior to
approving any Application for Advance. The amount of each Advance of the
Construction Allocation under the Loan shall be the amount which the
Contractor has earned under the Construction Contract, as approved by Lender,
less amounts for which sums have been previously advanced, less the Retainage
as more fully described in subparagraph (e) hereinafter and such amount shall
be advanced under the Loan on behalf of Borrower and shall be delivered
directly to Borrower. Lender shall not be required to advance funds if in the
good faith opinion of Lender (i) the Work is not being completed in a timely
and good and workmanlike manner, in accordance with the Plans, (ii) Borrower
fails to promptly pay for any labor or materials relating to the Work, or
(iii) the portion of the Loan then remaining unadvanced will not be
sufficient to complete the Work in accordance with the Master Plan and the
Approved Budget, whereupon no additional Advances will be due Borrower unless
and until Borrower at its sole cost performs a sufficient portion of the Work
so that such portion of the Loan then remaining unadvanced (including the
Borrower Deposit as such term is defined in Subsection 1.10 hereinabove) is
determined by Lender to be sufficient to so complete the Work. In such latter
event, Lender may also require Borrower to provide evidence of availability
of additional funds to make up such deficiency and/or may require that the
additional funds be held by Lender as part of the Borrower Deposit, to be
funded in accordance with the terms hereof. Notwithstanding the foregoing,
completion of the Work for which an “Advance is requested and the amount of
each Advance shall be determined in the reasonable discretion of Lender.
Borrower shall utilize all Advances made to it by Lender only for the payment
of the costs itemized in the Approved Budget as amended from time to time.
Anything to the contrary contained in this Section notwithstanding, in the
event that Borrower is required to deposit balancing funds with Lender
hereunder and the Property is thereafter completed with subsequent savings
that, had they occurred prior to the requirement of the balancing funds,
would have rendered all or a portion of such deposit to be unnecessary,
Borrower shall be entitled to a reimbursement of the funds deposited equal to
the lesser of (a) the amount of such subsequent savings or (b) the amount of
the balancing funds deposit.
	 
	 	(e)	 	Lender may, at its election, retain the statutory 10% Retainage
from each Advance relating to construction of Improvements hereunder in order
to allow Borrower to fully comply with Section 53.101 of tire Texas Property
Code for the payment of mechanics, materialmen, subcontractors, contractors and
artisans or others entitled to liens against the Property for work done or
materials supplied (the “Retainage”), such Retainage to be held until thirty
days after the date the Lender has received the following: (1) a substantial
completion certificate executed by Inspecting Engineers, the Supervision
Professional, Contractor and Borrower, (2) evidence that

8

 

	 	 	 	all Governmental Requirements have been satisfied, including if
applicable, but not limited to, delivery to Lender of certificates of
occupancy permitting the Improvements to be legally occupied, (3) evidence
that no mechanic’s or materialmen’s liens or other encumbrances have been
filed and remain in effect against the Property, (4) final lien releases or
waivers by Contractor, and all subcontractors, materialmen, and other
parties who have supplied labor, materials, or services for the construction
of the Improvements, or who otherwise might be entitled to claim a
contractual, statutory, or constitutional lien against the Property, and (5)
issuance by the Title Company of an endorsement to the mortgagee title
policy deleting the mechanic’s lien and pending disbursements exceptions and
recertifying the survey deletion endorsement, at which time, such retained
sums shall be disbursed by Lender to Borrower and then by Borrower to
contractors, suppliers, artisans, and others entitled thereto. In the event
that Lender does not retain the statutory 10% Retainage from each Advance
relating to construction of Improvements, it is agreed that Borrower, upon
request by Lender, shall provide the Lender with proof in form and content
satisfactory to the Lender that such statutory Retainage requirement is
being complied with by Borrower. At the Lender’s discretion, upon notice to
Borrower, the Lender may withhold such Retainage from each such Advance in a
special account of Borrower established for that purpose for the use and
benefit of those entitled thereto. Notwithstanding anything contained in
this Agreement to the contrary, Lender shall not withhold Retainage on
materials, soft costs, payments to subcontractors whose work has been
completed and who have furnished a final lien waiver and release, and any
Construction Contract for which payment and performance bonds acceptable to
Lender have been obtained.
	 
	 	(f)	 	All Advances hereunder shall be made directly to Borrower,
provided if an Event of Default has occurred, the Lender at its option may
make Advances directly to Borrower’s contractors, subcontractors, suppliers
and artisans for work done, or other person entitled thereto, or jointly to
Borrower and the applicable third party, or Lender may elect to make one or
more Advances through the title company, at Borrower’s expense.
	 
	 	(g)	 	Any provision in the Loan Documents to the contrary
notwithstanding, Lender shall have no obligation to make any Advance hereunder
or under any of the Loan Documents if, as a result of such Advance, Lender
would be in violation of any applicable federal or state statute, law,
regulation, or interpretation thereof, whether effective or prospective,
regarding lending limits imposed upon Lender, including but not limited to the
Garn-St. Germain Depository Institutions Act of 1982, the Federal Reserve Act
and applicable interpretive letters issued by the Office of the Comptroller of
the Currency.
	 
	 	(h)	 	Any provision hereof or in the Loan Documents to the contrary
notwithstanding, the total of the Advances for the Improvements hereunder shall
not exceed the lesser of (1) $13,355,000.00; (2) an amount equal to sixty-five
percent (65%) of the appraised value of the Property on an “as completed”
basis, as set forth in the Appraisal; or (3) an amount equal to sixty-five
percent (65%) of Borrower’s costs expended on the Land and Improvements on
items included in the Approved Budget, exclusive of any developer fees not
included in the Approved Budget.

9

 

	 	(i)	 	The initial Approved Budget does contain a line item for
$637,049.00 in Development Fees, such fees may be funded through Application
for Advance as follows:

	 	(1)	 	$10,000.00 per month beginning in the first
month Advances for Improvements are made, up to $120,000.00;
	 
	 	(2)	 	$100,000.00 upon substantial completion of the
Improvements and obtaining a project certificate of occupancy from the
City of Huntsville;
	 
	 	(3)	 	$100,000.00 when the monthly gross rents are
equal or greater than the monthly expenses including debt service; and
	 
	 	(4)	 	The balance to be funded at Borrower’s request
after Rent Stabilization, to wit: when the Property reaches a 1.30 to
1,00 debt service coverage ratio for 90 consecutive days based on
collected rents, a 30 year amortization utilizing an assumed
underwriting interest rate equal to the greater of (i) seven percent
(7.00%) per annum or (ii) the per annum interest rate for a permanent
loan quoted in the market at the time of the calculation for loans on
student housing properties.

     2.03 Requirements for Subsequent Advances. Prior to Lender funding additional
Advances subsequent to the Initial Advance funding on the Closing Date, Borrower shall have
provided Lender with the following:

	 	(a)	 	Executed originals of all of the Loan Documents;
	 
	 	(b)	 	All required Title Insurance Policies;
	 
	 	(c)	 	Evidence from Borrower of Borrower’s Equity in the project;
	 
	 	(d)	 	Satisfactory evidence the Borrower has established the
Operating Account with Depository Bank. All Advances made subsequent to
closing shall be funded into such account;
	 
	 	(e)	 	Executed original of the Availability of Utilities Letter;
	 
	 	(f)	 	Building permits for the construction of the Improvements,
except that Lender agrees to Advance for Borrower to obtain Letters of Credit
or to pay soft costs prior to receipt of said building permits;
	 
	 	(g)	 	Adequate evidence of appropriate zoning for the intended
usage of the Property;
	 
	 	(h)	 	Final Plans of the proposed Improvements;
	 
	 	(i)	 	If required by the Governmental Authority, a copy of the
final recorded subdivision plat;

10

 

	 	(j)	 	The Appraisal in form and substance satisfactory to Lender
indicating a fair market value in compliance with the limitations of
Section 2.02(h) of this Agreement;
	 
	 	(k)	 	Borrower and the general contractor shall have executed and
delivered the Assignment of Construction Contract;
	 
	 	(l)	 	Borrower and the Design Professional shall have executed and
delivered the Assignment of Rights to Plans and Specifications;
	 
	 	(m)	 	Borrower shall have executed and delivered the Assignment of
Permits and Licenses;
	 
	 	(n)	 	Satisfactory evidence of the compliance by Borrower with all
insurance requirements provided in the Deed of Trust;
	 
	 	(o)	 	Receipt and approval by Lender of the Master Plan;
	 
	 	(p)	 	If required in writing by Lender, receipt and approval of an
attorney’s opinion rendered by Borrower’s counsel in form and substance
satisfactory to Lender;
	 
	 	(q)	 	Receipt and approval by Lender of the Compliance Letter;
	 
	 	(r)	 	Fully executed copy of the Affidavit of Commencement in form
of the affidavit attached hereto as Exhibit “F” and made a part hereof
for all purposes;
	 
	 	(s)	 	Receipt and approval by Lender of all change orders affecting the Work; and
	 
	 	(t)	 	Satisfactory evidence with regard to adequate parking.

     2.04 Conditions to Subsequent Advances. As a condition precedent to each Advance
subsequent to the Closing Date, and, in addition to all other requirements herein, Borrower must
satisfy the following requirements and, if required by Lender, deliver to Lender evidence of such
satisfaction:

	 	(a)	 	There shall then exist no Event of Default or any condition or
event which, with the giving of notice and/or passing of time, would
constitute an Event of Default;
	 
	 	(b)	 	The representations and warranties made in this Agreement and
all Loan Documents shall be true and correct on and as of the date of each
Advance, with the same effect as if made on that date;
	 
	 	(c)	 	Borrower will procure and deliver to Lender, if required by
Lender, releases or waivers of mechanic’s liens in form of the Partial Waiver
and Release attached hereto as Exhibit “G-l” and made a part hereof
for all purposes, and receipted bills showing payment of all parties who have
furnished materials or services or performed labor of any kind in connection
with the construction of any of the Improvements;

11

 

	 	(d)	 	The Title Insurance Policy shall, if available under local rules,
be endorsed and extended to cover each Advance with no additional title
exceptions objectionable to Lender; and
	 
	 	(e)	 	Borrower shall be required to furnish Lender an acceptable
“slab” or “forms” survey prior to disbursement of the first Advance following
the completion of all foundation and slab work for the improvements. All
surveys are to be satisfactory to Lender in all respects, and are to include
among other things, encroachments, building set-back lines, public access and
flood plain disclosures, and must be dated, signed and stamped by a surveyor
licensed by the State of Texas.

     2.05 Completion of Improvements. Construction of the Improvements shall be completed
on or
before the Completion Date. Within forty-five days after completion, Borrower must provide to
Lender the
following:

	 	(a)	 	If Borrower has provided title insurance coverage during the
construction period by purchase of an title policy binder on interim
construction, Borrower shall provide Lender, at time of completion, a
mortgagee title policy with no exceptions except those approved by Lender. If
Borrower has already provided a mortgagee title policy, Borrower shall provide
an endorsement of said policy deleting the mechanic’s lien and pending
disbursements exceptions, and recertifying the survey deletion endorsement;
	 
	 	(b)	 	Borrower shall provide Lender, at time of completion and final
funding, those affidavits, releases and certificates in form of the exhibits
attached hereto as follows:

	 	 	 

	Final Waiver and Release of Lien:

	 	Exhibit “G-2”
	Affidavit of Certificate of Completion:

	 	Exhibit “H”
	Contractor’s Affidavit of Bills Paid:

	 	Exhibit “I-1”
	Owner’s Affidavit of Bills Paid:

	 	Exhibit “I-2”

	 	(c)	 	The final plat or replat, if any, must be recorded if not previously recorded;
	 
	 	(d)	 	Receipt of certificates of occupancy where and when available
from the Governmental Authorities;
	 
	 	(e)	 	Receipt of a hazard and general liability insurance policy
meeting the requirements of the Deed of Trust; and
	 
	 	(f)	 	An “as built” survey in a form satisfactory to Lender in all
respects, which shall include among other things, encroachments, building
set-back lines, public access and flood plain disclosures, and must be dated,
signed and stamped by a surveyor licensed by the State of Texas.

     2.06 No Waiver. No Advance shall constitute a waiver of any condition precedent to the
obligation of Lender to make any further Advance or preclude Lender from thereafter declaring
the failure
of Borrower to satisfy such condition precedent to be an Event of Default.

12

 

     2.07 Conditions Precedent for the Benefit of Lender. All conditions precedent to
the obligation of Lender to make any Advance are imposed hereby solely for the benefit of Lender,
and no other party may require satisfaction of any such condition precedent or be entitled to
assume that Lender will refuse to make any Advance in the absence of strict compliance with such
conditions precedent. All requirements of this Agreement may be waived by Lender, in whole or in
part, at any time.

     2.08 Subordination. Lender shall not be obligated to make, nor shall Borrower be
entitled to, any Advance until such time as Lender shall have received, to the extent reasonably
requested by Lender, subordination agreements from the general contractor and the Design
Professional, subordinating to the lien of the Deed of Trust any hen, claim, or charge they may
have against Borrower or the Property.

     2.09 Operating Account. The Operating Account shall be maintained by Borrower at all
times during the term of the Loan. The Operating Account shall be, and by execution hereof is,
pledged to secure the Loan. All net revenues generated by Borrower in connection with the Land not
required to be applied to the principal balance of the Loan shall be deposited in the Operating
Account.

     2.10 Letters of Credit. It is contemplated by Borrower and Lender that Borrower, or
one or more of its affiliates, may desire to apply for and obtain one or more Letters of Credit
from Depository Bank. In the event that any such party applies for a Letter of Credit with
Depository Bank and is approved, at Borrower’s request, Lender may consent to same and in such
event will reserve an amount of Loan proceeds to cover any potential advances that may be made
under the Letter of Credit to the beneficiary thereunder. Any such approval by Lender will be at
Lender’s sole discretion but will not be unreasonably withheld, and the aggregate amount of Loan
proceeds to cover any potential advances under the Letters of Credit will not exceed $1,000,000.00
at any one time. Borrower agrees to execute any and all documents reasonably deemed necessary by
Lender in connection with Letter of Credit transactions, including amendments to this Agreement,
amended Approved Budgets, additional security agreements and other collateral documents. In the
event a Letter of Credit contemplated by the terms of this section is presented to Depository Bank
and drafted upon, Borrower agrees that Lender shall, without the consent of Borrower, advance Loan
proceeds to repay die Depository Bank for advances under the Letter of Credit. Lender will not be
required to release its collateral securing the Loan until such time as all obligations of the
Depository Bank under any Letters of Credit have expired or been terminated, and until the Note is
paid in full. The expiration dates of any such Letters of Credit shall not exceed twelve months
from date of issuance, and shall not extend past the Scheduled Maturity Date as defined in the
Note, as may be extended from time to time. Borrower shall also pay to Lender or to Depository
Bank (but not to both of them) at the time a Letter of Credit is issued by Depository Bank
pursuant to the terms of this section, a letter of credit fee equal to one percent (1%) of the
face amount of each Letter of Credit. If the Note matures prior to expiration of the Letter of
Credit, then at the time of issuance of the Letter of Credit, the Borrower shall deposit with
Depository Bank in a controlled account the principal necessary to fund the Letter of Credit upon
any draw on the Letter of Credit.

     Borrower shall be irrevocably and unconditionally obligated to reimburse Lender for any
amounts to be paid by Lender upon any drawing under any Letter of Credit issued by Depository Bank
for the benefit of Borrower, without presentment, demand, protest or other formalities of any kind.
All such amounts paid by Lender and remaining unpaid by the Borrower shall bear interest at the
Applicable Interest Rate as such term is used and defined in the Note. The Borrower’s obligations
under this paragraph shall be absolute and unconditional under any and all circumstances and
irrespective of any set-off, counterclaim or defense to payment which the Borrower may have or have
had against Lender or the beneficiary of a Letter of Credit issued by Depository Bank pursuant to
the request of Borrower.

13

 

     Borrower further irrevocably and unconditionally agrees with Lender that Lender shall not be
responsible for, and Borrower’s reimbursement obligation in respect of any Letter of Credit shall
not be affected by, among other things, the validity or genuineness of documents or any
endorsements thereon, even if such documents should in fact prove to be in any or all respects
invalid, fraudulent or forged, or any dispute between or among Borrower, the beneficiary of any
Letter of Credit or any financing institution or other party or any claims or defenses whatsoever
of any of the Borrower or any of its affiliates against the beneficiary of any Letter of Credit.
Lender shall not be liable for any error, omission, interruption or delay in transmission,
dispatch or delivery of any message or advice, however transmitted, in connection with any Letter
of Credit. Borrower irrevocably and unconditionally agrees that any action taken or omitted by
Lender or Depository Bank under or in connection with each Letter of Credit and the related
drafts and documents, if done without gross negligence or willful misconduct, shall be binding
upon Borrower and shall not put Lender under any liability to Borrower.

     Lender and Depository Bank shall be entitled to rely, and shall be fully protected in relying
upon, any letter of credit, draft, writing, resolution, notice, consent, certificate, affidavit,
letter, cablegram, telegram, telecopy, telex or teletype message, statement, order or other
document believed by it to be genuine and correct and to have been signed, sent or made by the
proper Person or Persons, and upon advice and statements of legal counsel, independent accounts
and other experts selected by Lender.

     EXCEPT FOR LENDER’S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT, BORROWER HEREBY IRREVOCABLY AND
UNCONDITIONALLY AGREES TO INDEMNIFY AND HOLD HARMLESS LENDER AND ITS DIRECTORS, OFFICERS, AGENTS
AND EMPLOYEES FROM AND AGAINST ANY AND ALL CLAIMS AND DAMAGES, LOSSES, LIABILITIES, COSTS OR
EXPENSES WHICH LENDER MAY INCUR (OR WHICH MAY BE CLAIMED AGAINST LENDER BY ANY PERSON WHATSOEVER)
BY REASON OF OR IN CONNECTION WITH THE ISSUANCE, EXECUTION AND DELIVERY OR TRANSFER OF OR PAYMENT
OR FAILURE TO PAY UNDER ANY LETTER OF CREDIT OR ANY ACTUAL OR PROPOSED USE OF ANY LETTER OF
CREDIT, INCLUDING, WITHOUT LIMITATION, ANY CLAIMS, DAMAGES, LOSSES, LIABILITIES, COSTS OR EXPENSES
WHICH LENDER MAY INCUR BY REASON OF OR ON ACCOUNT OF LENDER ISSUING ANY LETTER OF CREDIT WHICH
SPECIFIES THAT THE TERM “BENEFICIARY” INCLUDED THEREIN INCLUDES ANY SUCCESSOR BY OPERATION OF LAW
OF THE NAMED BENEFICIARY, BUT WHICH LENDER DOES NOT REQUIRE THAT ANY DRAWING BY SUCH SUCCESSOR
BENEFICIARY BE ACCOMPANIED BY A COPY OF A LEGAL DOCUMENT, SATISFACTORY TO LENDER, EVIDENCING THE
APPOINTMENT OF SUCH SUCCESSOR BENEFICIARY.

ARTICLE III: REPRESENTATIONS AND WARRANTIES OF BORROWER

     3.01 Representations and Warranties. Borrower hereby, and upon submission of each
Application for Advance and acceptance of each Advance, represents and warrants as follows:

	 	(a)	 	All representations and warranties made by Borrower under the
Deed of Trust are true and correct;
	 
	 	(b)	 	No claims for unpaid bills for the supplying of labor,
materials, or services for the construction of the Improvements shall have been
recorded in the mechanic’s lien or other appropriate records in the county
where the Property is located, or if such claims are made, Borrower has bonded
the liens in accordance with Chapter 53 of the Texas Property Code. Except as
previously disclosed in writing to Lender, as

14

 

	 		 	of this date no work of any kind or nature, however incidental, has
been performed by any party on behalf of Borrower with regard to the
preparation of the Property for construction of the contemplated
Improvements or construction of the Improvements themselves. Except as
previously disclosed in writing to Lender, no materials have been delivered
to the Property on behalf of Borrower. Except as previously disclosed in
writing to Lender, the Borrower on the date hereof, has made no verbal or
written contract or arrangement of any kind the performance of which by the
other party thereto would give rise to a lien on the Property which on the
date hereof is superior to the liens created under any of the Loan Documents
and/or liens transferred to the Lender thereunder. Borrower shall not cause
or allow any liens to be placed on the Property without the
approval of the Lender;
	 
	 	(c)	 	No litigation or proceedings have been, to the best of
Borrower’s knowledge, threatened against the Property or the Borrower (i) which
would materially and adversely affect the enforceability or priority of the
Loan Documents, or (ii) which would materially and adversely affect the ability
of Borrower to complete the Improvements or the ability of Borrower to perform
its obligations pursuant to and as contemplated by the terms of this Agreement
and the Loan Documents;
	 
	 	(d)	 	The Approved Budget presents a full and complete representation
of all costs, expenses and fees which Borrower expects to pay or anticipates
becoming obligated to pay to complete the construction of the Improvements;
	 
	 	(e)	 	To the best of Borrower’s knowledge: (i) all consents, licenses
and permits and all other authorizations or approvals required to complete the
construction of the Improvements in accordance with the Plans have been or can
be obtained during the course of the construction in time to complete the
construction on or before the Completion Date; (ii) all laws, ordinances,
regulations, restrictive covenants and requirements of all Governmental
Authorities (including, building, health, fire, water, use, zoning laws,
environmental and similar laws, codes, ordinances, rules and regulations)
relating to the construction of the Improvements and operation of the Property
have been or can be complied with; and (iii) all permits and licenses required
for the operation of the Property which cannot be obtained until construction
of the Improvements is completed can be obtained if the Property is completed
in accordance with the Plans. The Plans have been approved by all Governmental
Authorities or, to the best of Borrower’s knowledge, will be approved when
required during the course of the construction of the Improvements in time to
complete the construction on or before the Completion Date. To the best of
Borrower’s knowledge, construction of the Improvements and operation of the
Property will not be delayed or impeded by virtue of any Governmental
Requirements. To the best of Borrower’s knowledge, upon completion of the
construction of tire Improvements, the Property will comply with all
Governmental Requirements; and
	 
	 	(f)	 	When completed in accordance with the Plans, no portion of the
Improvements will encroach upon any adjacent property, building line, setback
line, side yard line, or any recorded or visible easement (or other easement of
which Borrower is aware or has reason to believe may exist) with respect to the
Property. Upon completion of Improvements, the Property will have adequate
rights of access to dedicated public

15

 

	 	 	 	streets and roads and will have (or when the Improvements are completed in
accordance with the Master Plan will have) adequate rights and means of
access to all water, sanitary sewer and storm drainage facilities necessary
for the intended use of the Property; all public roads necessary for
adequate ingress and egress to the Property have been, completed with the
necessary rights-of-way therefor having been acquired by the appropriate
Governmental Authority, and all necessary steps having been taken by
Borrower and such Governmental Authority to assure the completion,
construction and installation thereof before or by the applicable
Completion Date.

     3.02 Survival of Representations and Warranties. Borrower agrees mat all
representations and warranties in this Agreement will be true in all material respects at the date
of the first Advance and at all times thereafter until the Loan is repaid in full. Each
Application for Advance shall constitute a reaffirmation that the representations and warranties
are true and correct in all material respects at such time.

     3.03 Inducement to Lender. The representations and warranties contained in the Loan
Documents are made by Borrower as an inducement to Lender to make the Loan and Borrower
understands that lender is relying on the truth and accuracy of such representations and
warranties.

ARTICLE IV: COVENANTS AND AGREEMENTS OF BORROWER

     Borrower hereby covenants and agrees as follows:

     4.01 Compliance with Governmental Requirements. Borrower shall timely comply with all
Governmental Requirements and deliver to Lender evidence thereof. Borrower assumes full
responsibility for the compliance of the Plans and the Property with all Governmental Requirements
and with sound construction and engineering practices and, notwithstanding any approvals by
Lender, Lender shall have no obligation or responsibility whatsoever for the Plans or any other
matter incident to the Property or the construction of the Improvements.

     4.02 The Construction Contract. Borrower shall not become a party to any contract in
excess of $50,000.00 for the performance of any Work on the Property or for the supplying of any
labor, materials, or services for the construction of the Improvements except upon such terms and
with such parties as shall be approved in writing by Lender. Lender’s approval of any contractor or
contract may be conditioned upon such contractor providing a payment and performance bond for all
or part of the work to be undertaken under the contract. Borrower may retain an affiliated
construction company to act as general contractor; in such case, all approval rights of Lender and
rights to require bonding of Lender shall be for subcontractors and suppliers. The general
contractor must agree in writing that all liens of the genera] contractor are subordinate to the
lien of the Deed of Trust. The general contractor must agree in writing that no change orders to
the Plans for which Lender’s consent is required hereunder, shall be effective without the prior
written approval of Lender. No approval by Lender of any Construction Contract or change orders
thereto shall make Lender responsible for the adequacy, form, or content of such Construction
Contracts or change orders. Upon written request by Lender, Borrower shall supply Lender with a
list of all original contractors and all second and subsequent tier contractors and suppliers, and
their respective addresses and telephone numbers, and information with respect to the portion of
such contracts completed and sums owed to such contractors and suppliers. If requested by Lender,
Borrower will cause all subcontractors whose contract prices exceeds ten percent (10%) of the
amount of the Approved Budget, as provided in Section 1.15 herein to provide a performance bond and
a payment bond of such character, issued by companies; on forms and in such penal sum in connection
with the construction of the Improvements, as Lender shall designate. Unless waived by Lender, all
such bonds shall name Lender as co-obligee.

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     4.03 Construction of the Improvements and Supervision. The construction of the
Improvements shall commence no later than ninety days from the date hereof and shall be prosecuted
with diligence and continuity, in a good and workmanlike manner, and in accordance with sound
building and engineering practices, all applicable Governmental Requirements and the Plans, if
any, Except for Force Majeure events, Borrower shall not permit cessation of work for a period in
excess of thirty days without the prior written consent of Lender and shall complete construction
of the Improvements on or before the Completion Date. The construction of the Improvements will be
prosecuted by Borrower with diligence and continuity and Borrower will complete the same in
substantial accordance with the Plans, free and clear of liens, or claims for liens, for material
supplied and for labor or services performed in connection with the construction of the
Improvements, and in compliance with all applicable Governmental Requirements, restrictive
covenants, set back lines and without encroachment into any existing easements which affect the
Property. Borrower shall hire and direct the Supervision Professional at all times prior to
completion of Improvements in a manner reasonably satisfactory to Lender.

     4.04 Correction of Construction Defects. Borrower shall correct or cause to be
corrected (a) any material defect in the Improvements, (b) any material departure in the
construction of the Improvements from the Plans or Governmental Requirements, or (c) any
encroachment by any part of the Improvements or any other structure located on the Property on any
building line, easement, property line, or restricted area.

     4.05 Storage of Materials. Borrower shall cause all materials supplied for, or
intended to be utilized in, the construction of the Improvements, but not affixed to or
incorporated into the Improvements or the Property, to be stored on the Property, with adequate
safeguards, as required by Lender, to prevent loss, theft, damage, or commingling with other
materials or projects.

     4.06 Inspection of the Property. Borrower shall permit Lender and any Governmental
Authority, and their agents and representatives, to enter upon the Property and any location where
materials intended to be utilized in the construction of the Improvements are stored for the
purpose of inspection of tire Property and such materials at all reasonable times.

     4.07 Notices by Governmental Authority. Fire and Casualty Losses. Etc, Borrower shall
timely comply with and promptly furnish to Lender true and complete copies of any official notice
or claim by any Governmental Authority pertaining to the Property. Borrower shall promptly notify
Lender of any fire or other casualty or any notice or taking of eminent domain action or
proceeding affecting the Property.

     4.08 Application of Advances. Borrower shall disburse all Advances for payment of
costs and expenses specified in the Approved Budget, and for no other purpose.

     4.09 Direct Disbursement and Application by Lender. Upon the occurrence and during the
continuance of an Event of Default, or any event or condition which, with the giving of notice
and/or passing of time, would constitute an Event of Default, Lender shall have tire right, but not
the obligation, to disburse and directly apply the proceeds of any Advance to the satisfaction of
any of Borrower’s obligations hereunder. Any Advance by Lender for such purpose, shall be part of
the Loan and shall be secured by the Loan Documents. Upon the occurrence and during the continuance
of an Event of Default, Borrower hereby authorizes Lender to hold, use, disburse, and apply the
Loan and proceeds of the Borrower Deposit for payment of costs of construction of the Improvements,
expenses incident to the Loan and the Property, and the payment or performance of any obligation of
Borrower hereunder. Borrower hereby assigns and pledges the proceeds of the Loan and proceeds of
the Borrower Deposit to Lender for such purposes. Upon the occurrence and during the continuance of
an Event of Default, Lender may advance and incur such expenses

17

 

hereunder as Lender reasonably deems necessary for the completion of construction of the
Improvements and to preserve the Property, and any other security for the Loan, and such expenses,
even though in excess of the amount of the Loan, shall be secured by the Loan Documents, and be
payable to Lender upon demand. Lender may disburse any portion of any Advance at any time, and
from time to time, to persons other than Borrower for the purposes specified in this Section 4.09
irrespective of the provisions of Section 2.03 hereof, and the amount of Advances to which
Borrower shall thereafter be entitled shall be correspondingly reduced.

     4.10 Costs and Expenses. Borrower shall pay when due all costs and expenses required
by this Agreement, including, without limitation, (a) all fees and expenses of the Inspecting
Engineers, (b) all reasonable fees and expenses of counsel of Lender related to the Loan Documents,
the construction of Improvements or protecting the interests of Lender in the Property, (c) all
title insurance downdates/endorsements and title examination charges, including premiums for the
Title Insurance Policies, (d) all premiums for the insurance policies required under the Deed of
Trust, and (e) all other reasonable costs and expenses payable to third parties incurred by Lender
in connection with the consummation of the transactions contemplated by this Agreement.

     4.11 Change Orders. Borrower shall not make any change order to the Plans or any
other change order with respect to the Approved Budget, which individually exceeds $50,000 or in
the aggregate with all other previously approved change orders exceeds $250,000, without the prior
written consent of Lender, which consent will not be unreasonably withheld or delayed.

     4.12 No Liability of Lender. Lender shall have no liability, obligation, or
responsibility whatsoever with respect to the construction of the Improvements except to advance
the Loan proceeds pursuant to this Agreement. Lender shall not be obligated to inspect the
Property or the construction of the Improvements, nor be liable for the performance or default of
Borrower, the Inspecting Engineers, the Contractor, or any other party, or for any failure to
construct, complete, protect, or insure the Improvements, or for the payment of costs of labor,
materials, or services supplied for the construction of the Improvements, or for the performance
of any obligation of Borrower whatsoever. Nothing, including without limitation any Advance or
acceptance of any document or instrument, shall be construed as a representation or warranty,
express or implied, to any party by Lender.

     4.13 No Conditional Sale Contracts. Etc. No materials, equipment, or fixtures shall
be supplied, purchased, or installed for the construction or operation of the Improvements
pursuant to security agreements, conditional sale contracts, lease agreements, or other
arrangements or understandings whereby a security interest or title is retained by any party or
the right is reserved or accrues to any party to remove or repossess any materials, equipment, or
fixtures intended to be utilized in the construction or operation of the Improvements.

     4.14 Defense of Action. Lender may (but shall not be obligated to) commence, appear
in, or defend any action or proceeding purporting to affect the Loan, the Property, or the
respective rights and obligations of Lender and Borrower pursuant to this Agreement. Lender may
(but shall not be obligated to)
pay all necessary expenses, including reasonable attorneys’ fees and expenses incurred hi
connection with such proceedings or actions, which Borrower agrees to repay to Lender upon
demand.

     4.15 Assignment of Construction Contract. As additional security for the payment of
the Loan,
Borrower hereby transfers and assigns to Lender all of Borrower’s rights and interest, but
not its obligations,
in, under, and to the construction contract with the general contractor upon the following
terms and
conditions:

18

 

	 	(a)	 	Borrower represents and warrants that the copy of such
construction contract it has furnished to Lender is a true and complete
copy thereof and that Borrower’s interest therein is not subject to any
claim, setoff, or encumbrance.
	 
	 	(b)	 	Neither this assignment nor any action by Lender shall
constitute an assumption by Lender of any obligations under the construction
contract, and Borrower shall continue to be liable for all obligations of
Borrower thereunder, Borrower hereby agreeing to perform all of its
obligations under the construction contract. Borrower agrees to indemnify and
hold Lender harmless against and from any loss, cost, liability, or expense
(including, but not limited to, reasonable attorneys’ fees) resulting from any
failure of Borrower to so perform.
	 
	 	(c)	 	Upon the occurrence and during the continuance of an Event of
Default, Lender shall have the right at any time (but shall have no
obligation) to take in its name or in the name of Borrower such action as
Lender may at any time determine to be necessary or advisable to cure any
default under the construction contract or to protect the rights of Borrower
or Lender thereunder. Lender shall incur no liability if any action so taken
by it or in its behalf shall prove to be inadequate or invalid, and Borrower
agrees to hold Lender free and harmless against and from any loss, cost,
liability or expense (including, but not limited to, reasonable attorneys’
fees) incurred in connection with any such action.
	 
	 	(d)	 	Borrower hereby irrevocably constitutes and appoints Lender as
Borrower’s attorney-in-fact, in Borrower’s name or in Lender’s name, to enforce
all rights of Borrower under the construction contract during the continuance
of an Event of Default. The power-of-attorney granted hereby is a power coupled
with an interest and is irrevocable.
	 
	 	(e)	 	Prior to an Event of Default, Borrower shall have the right to
exercise its rights as owner under the construction contract, provided that
Borrower shall not cancel or amend the construction contract or do or suffer
to be done any act which would impair the security constituted by this
assignment without the prior written consent of Lender.
	 
	 	(f)	 	This assignment shall inure to the benefit of Lender, its
successors and assigns, including any purchaser upon foreclosure of the Deed
of Trust, any receiver in possession of the Property, and any legal entity
formed by or on behalf of Lender winch assumes Lender’s rights and obligations
under this Agreement.

     4.16 Assignment of Plans. As additional security for the payment of the Loan, Borrower
hereby transfers and assigns to Lender all of Borrower’s right, title, and interest in and to die
Plans and hereby represents and warrants to and agrees with Lender as follows:

	 	(a)	 	Borrower has delivered to Lender a complete and accurate description of the
Plans.
	 
	 	(b)	 	The Plans are complete and adequate for the construction of
the improvements and there have been no modifications thereof except as
described in such description.

19

 

	 	(c)	 	Lender may use the Plans for any purpose relating to the Improvements,
including but not limited to inspections of construction and the completion
of the Improvements.
	 
	 	(d)	 	Lender’s acceptance of this assignment shall not constitute
approval of the Plans by Lender. Lender has no liability or obligation
whatsoever in connection with the Plans and no responsibility for the
adequacy thereof or for the construction of the Improvements contemplated by
the Plans. Lender has no duty to inspect the Improvements, and if Lender
should inspect the Improvements, Lender shall have no liability or obligation
to Borrower arising out of such inspection. No such inspection nor any
failure by Lender to make objections after any such inspection shall
constitute a representation by Lender that the Improvements are in accordance
with the Plans or constitute a waiver of Lender’s right thereafter to insist
that the Improvements be constructed in accordance with the Plans.
	 
	 	(e)	 	This assignment shall inure to the benefit of Lender, its
successors and assigns, including any purchaser upon foreclosure of the Deed
of Trust, any receiver in possession of the Property, and any legal entity
formed by or on behalf of Lender which assumes Lender’s rights and
obligations under this Agreement.

     4.17 Payment of Claims. Borrower shall promptly pay or cause to be paid when due all
costs and expenses incurred in connection with the Property and the construction of the
Improvements, and Borrower shall keep the Property free and clear of any liens, charges, or
claims other than the lien of the Deed of Trust and other liens approved in writing by Lender.
Notwithstanding anything to the contrary contained in this Agreement, Borrower (a) may contest
the validity or amount of any claim of any contractor, consultant, architect, or other person
providing labor, materials, or services with respect to the Property, (b) may contest any tax or
special assessment levied by any Governmental Authority, and (c) may contest the enforcement of
or compliance with any Governmental Requirements, and such contest on the part of Borrower shall
not be an Event of Default hereunder and shall not release Lender from its obligations to make
Advances hereunder; provided, however, that during the pendency of any such contest, Borrower
shall furnish to Lender and Title Company an indemnity bond with corporate surety satisfactory to
Lender and Title Company or other security acceptable to them in an amount equal to the amount
being contested plus a reasonable additional sum to cover possible costs, interest, penalties,
and attorney’s fees, and provided further that Borrower shall pay any amount adjudged by a court
of competent jurisdiction to be due, with all costs, interest, penalties and attorney’s fees
thereon, before such judgment becomes a lien on the Property.

     4.18 Inspections. If required by Lender, Inspecting Engineers shall make periodic
inspections of the Property during the course of construction in order to certify to Lender that at
the time an Application for Advance is made: (a) the amount requested is in proportion to the Work
completed; (b) that all Work has been performed in a workmanlike manner; (c) the Work performed is
substantially in accordance with the Plans; and (d) there are sufficient funds remaining to
complete the Improvements. The Inspecting Engineers must be satisfied that the Improvements are in
compliance with reasonable fire, safety and health standards, in . addition to standards imposed by
law or regulation. All defects in the Improvements disclosed by an engineering report, and
violations of zoning, building, environmental, health, safety or other governmental or regulatory
rules, laws, codes or regulations are to be corrected if in Lender’s reasonable judgment such
defects or violations affect marketability or usage of the Property or the value of the Property
for loan purposes.

20

 

     4.19 Indemnity. BORROWER SHALL INDEMNIFY AND DEFEND LENDER AGAINST, AND SHALL HOLD
LENDER HARMLESS FROM ANY AND ALL LOSSES, DAMAGES (WHETHER GENERAL, PUNITIVE OR OTHERWISE),
LIABILITIES, CLAIMS, CAUSES OF ACTION (WHETHER LEGAL, EQUITABLE OR ADMINISTRATIVE), JUDGMENTS,
COURT COSTS AND LEGAL OR OTHER EXPENSES (INCLUDING ATTORNEYS’ FEES) WHICH LENDER MAY SUFFER OR
INCUR AS A DIRECT OR INDIRECT CONSEQUENCE OF: (A) LENDER’S PERFORMANCE UNDER THIS AGREEMENT OR
UNDER ANY OF THE OTHER LOAN DOCUMENTS, INCLUDING WITHOUT LIMITATION LENDER’S EXERCISE OR FAILURE
TO EXERCISE ANY RIGHTS, REMEDIES OR POWERS IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER
LOAN DOCUMENTS; (B) BORROWER’S FAILURE TO PERFORM ANY OF BORROWER’S OBLIGATIONS AS AND WHEN
REQUIRED BY THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS, INCLUDING WITHOUT LIMITATION, ANY
FAILURE OF ANY REPRESENTATION OR WARRANTY OF BORROWER TO BE TRUE AND CORRECT AND ANY FAILURE BY
BORROWER TO SATISFY ANY CONDITION; (C) ANY CLAIM OR CAUSE OF ACTION OF ANY KIND BY ANY PERSON OR
ENTITY TO THE EFFECT THAT LENDER IS IN ANY WAY RESPONSIBLE OR LIABLE FOR ANY ACT OR OMISSION BY
BORROWER, WHETHER ON ACCOUNT OF ANY THEORY OF DERIVATIVE LIABILITY OR OTHERWISE; (D) ANY ACT OR
OMISSION BY BORROWER, ANY CONTRACTOR, SUBCONTRACTOR OR MATERIAL SUPPLIER, ENGINEER, ARCHITECT OR
OTHER PERSON OR ENTITY, EXCEPT LENDER, WITH RESPECT TO ANY OF THE PROPERTY; (E) THE CONSTRUCTION
OR OTHER WORK CONTEMPLATED HEREIN; (F) THE OPERATION OR MAINTENANCE OF THE PROPERTY; AND (G) ANY
OTHER ACTION OR INACTION BY, OR MATTER WHICH IS THE RESPONSIBILITY OF BORROWER, EXCEPT FOR ANY
SUCH CLAIM, INJURY, DAMAGE, LOSS OR LIABILITY CAUSED SOLELY BY THE WILLFUL MISCONDUCT OR GROSS
NEGLIGENCE OF LENDER OR ITS AGENTS OR EMPLOYEES. LENDERS’ RIGHT OF INDEMNITY SHALL NOT BE DIRECTLY
OR INDIRECTLY LIMITED, PREJUDICED, IMPAIRED OR ELIMINATED IN ANY WAY BY ANY FINDING OR ALLEGATION
THAT LENDER’S CONDUCT IS ACTIVE, PASSIVE OR SUBJECT TO ANY THEORY OF ANY KIND, CHARACTER OR NATURE
FOR ANY ACT OR OMISSION BY BORROWER OR ANY OTHER PERSON OR ENTITY EXCEPT LENDER. NOTWITHSTANDING
THE FOREGOING, BORROWER SHALL NOT BE OBLIGATED TO INDEMNIFY LENDER WITH RESPECT TO ANY INTENTIONAL
TORT OR ACT OF GROSS NEGLIGENCE WHICH LENDER IS PERSONALLY DETERMINED BY THE JUDGMENT OF A COURT
OF COMPETENT JURISDICTION (SUSTAINED ON APPEAL, IF ANY) TO HAVE COMMITTED. BORROWER SHALL PAY ANY
INDEBTEDNESS ARISING UNDER SAID INDEMNITY TO LENDER PROMPTLY UPON DEMAND BY LENDER. THIS INDEMNITY
SHALL SURVIVE THE PAYMENT OF ALL AMOUNTS PAYABLE PURSUANT TO THE LOAN DOCUMENTS. PAYMENT BY
LENDER SHALL NOT BE A CONDITION PRECEDENT TO THE OBLIGATIONS OF BORROWER UNDER THIS INDEMNITY.

     4.20 Lender’s Action for its Own Protection Only. The authority herein conferred upon
Lender, and any action taken by Lender, to inspect the Property, to procure waivers or sworn
statements, to approve contracts, subcontracts and purchase orders, and to approve Plans, will be
exercised and taken by Lender for Lender’s protection only and may not be relied upon by Borrower
for any purposes whatever; and Lender shall not be deemed to have assumed any responsibility to
Borrower with respect to any such action herein authorized or taken by Lender or with respect to
the proper construction of the Improvements on the Property, performance of contracts, subcontracts
or purchase orders by any contractor, subcontractor or material supplier, or prevention of
mechanics’ liens from being claimed or asserted against any of the Property. Any review,
investigation or inspection conducted by Lender, or any architectural or engineering consultants

21

 

retained by Lender to verify independently Borrower’s satisfaction of any conditions
precedent to Advance under this Agreement, Borrower’s performance of any of the covenants,
agreements and obligations of Borrower under this Agreement, or the validity of any
representations and warranties made by Borrower hereunder (regardless of whether the party
conducting such review, investigation or inspection shall have discovered that any of such
conditions precedent were not satisfied or that any such covenants, agreements or obligations
were not performed or that any such representations or warranties were not true), shall not
affect (or constitute a waiver by Lender of) (a) any of Borrower’s representations and warranties
under this Agreement or Lender’s reliance thereon or (b) Lender’s reliance upon any
certifications of Borrower or the Contractor required under this Agreement or any other facts,
information or reports furnished to Lender by Borrower hereunder.

ARTICLE V: RIGHTS AND REMEDIES OF LENDER

     5.01 Rights of Lender. Upon the occurrence and during the continuance of an Event of
Default, Lender shall have the right, in addition to any other right or remedy of Lender, but not
the obligation, in its own name or in the name of Borrower, to enter into possession of the
Property; to perform all work necessary to complete the construction of the Improvements
substantially in accordance with the Master Plan and -Governmental Requirements, and to employ
watchmen and other safeguards to protect the Property. Borrower hereby appoints Lender as the
attorney-in-fact of Borrower, with full power of substitution, and in the name of Borrower, if
Lender elects to do so, upon the occurrence of an Event of Default, to (a) use such sums as are
necessary, including any proceeds of the Loan and of the Borrower Deposit, make such changes or
corrections in the Plans, and employ such architects, engineers, and contractors as may be required
for the purpose of completing the construction of the Improvements substantially in accordance with
the Master Plan, and the Governmental Requirements, (b) execute all applications and certificates
in the name of Borrower which may be required for completion of construction of the Improvements,
(c) endorse the name of Borrower on any checks or drafts representing proceeds of the insurance
policies, or other checks or instruments payable to Borrower with respect to the Property, (d) do
every act with respect to the construction of the Improvements which Borrower may do, and (e)
prosecute or defend any action or proceeding incident to the Property. The power-of-attorney
granted hereby is a power coupled with an interest and is irrevocable. Lender shall have no
obligation to undertake any of the foregoing actions, and if Lender should do so, it shall have no
liability to Borrower for the sufficiency or adequacy of any such actions taken by Lender.

     5.02 Cessation of Advances. Upon the occurrence and during the continuance of an
Event of Default, or any event or condition which, with the giving of notice and/or passing of
time, would constitute an Event of Default, the obligation of Lender to disburse the Loan
proceeds and proceeds of the Borrower Deposit and all other obligations of Lender hereunder
shall, at Lender’s option, immediately terminate.

     5.03 Funds of Lender. Any funds of Lender used for any purpose referred to in this
Article V, shall constitute Advances secured by the Loan Documents and shall bear interest at
the rate specified in the Note to be applicable after default thereunder.

     5.04 No Waiver or Exhaustion. No waiver by Lender of any of its rights or remedies
hereunder, in the other Loan Documents, or otherwise, shall be considered a waiver of any other
or subsequent right or remedy of Lender; no delay or omission in the exercise or enforcement by
Lender of any rights or remedies shall ever be construed as a waiver of any right or remedy of
Lender; and, no exercise or enforcement of any such rights or remedies shall ever be held to
exhaust any right or remedy of Lender.

ARTICLE VI: GENERAL TERMS AND CONDITIONS

22

 

     6.01 Notices. All notices, demands, requests, and other communications required
or permitted hereunder shall be in writing and shall be given in accordance with the requirements
for notices under the Deed of Trust.

     6.02 Entire Agreement and Modifications. THE LOAN DOCUMENTS CONSTITUTE THE ENTIRE
UNDERSTANDING AND AGREEMENT BETWEEN THE PARTIES HERETO WITH RESPECT TO THE TRANSACTIONS ARISING IN
CONNECTION WITH THE LOAN AND SUPERSEDE ALL PRIOR WRITTEN OR ORAL UNDERSTANDINGS AND AGREEMENTS
BETWEEN THE UNDERSIGNED IN CONNECTION THEREWITH. NO PROVISION OF THIS AGREEMENT OR THE OTHER LOAN
DOCUMENTS MAY BE MODIFIED, WAIVED, OR TERMINATED EXCEPT BY INSTRUMENT IN WRITING EXECUTED BY THE
PARTY AGAINST WHOM A MODIFICATION, WAIVER, OR TERMINATION IS SOUGHT TO BE ENFORCED.

     6.03 Severability. In case any of the provisions of this Agreement shall for any
reason be held to be invalid, illegal, or unenforceable, such invalidity, illegality, or
unenforceability shall not affect any other provision hereof, and this Agreement shall be
construed as if such invalid, illegal, or unenforceable provision had never been contained herein.

     6.04 Election of Remedies. Lender shall have all of the rights and remedies granted in
the Loan Documents and available at law or in equity, and these same rights and remedies shall be
cumulative and may be pursued separately, successively, or concurrently against Borrower, any
guarantor of the Loan, or any property covered under the Loan Documents, at the sole discretion of
Lender. The exercise or failure to exercise any of the same shall not constitute a waiver or
release thereof or of any other right or remedy, and the same shall be nonexclusive.

     6.05 Form and Substance. All documents, certificates, insurance policies, and other
items required under this Agreement to be executed and/or delivered to Lender shall be in form and
substance satisfactory to Lender.

     6.06 No Third Party Beneficiary. This Agreement is for the sole benefit of Lender and
Borrower and is not for the benefit of any third party.

     6.07 Borrower In Control. In no event shall Lender’s rights and interests under the
Loan Documents be construed to give Lender the right to control, or be deemed to indicate that
Lender is in control of, the business, management or properties of Borrower or the daily
management functions and operating decisions made by Borrower.

     6.08 Number and Gender. Whenever used herein, the singular number shall include the
plural and the singular, and the use of any gender shall be applicable to all genders. The duties,
covenants, obligations, and warranties of Borrower in this Agreement shall be joint and several
obligations of Borrower, and of each party of Borrower if more than one.

     6.09 Captions. The captions, headings, and arrangements used in this Agreement are for
convenience only and do not in any way affect, limit, amplify, or modify the terms and provisions
hereof.

     6.10 Applicable Law. This Agreement shall be governed by and construed in accordance
with the internal laws of the State where the Property is located without reference to conflict of
laws rules.

23

 

     6.11 Multiple Counterparts. This Agreement may be executed in multiple
counterparts, and each counterpart hereof executed by any party shall be deemed an original and
shall as to such party constitute one and the same instrument with all other counterparts hereof
executed, regardless of whether the same or any other counterpart hereof is executed by any other
party or by a person intended to be or who becomes a party hereunder.

     EXECUTED AND DELIVERED on the date first recited.

	 	 	 	 	 
	 	BORROWER:

CAMPUS CREST AT HUNTSVILLE, LP, a Delaware limited partnership

 	 
	 	By:  	HSRE-CC Huntsville GP, LLC, a Delaware limited liability company,
 	 
	 	 	its General Partner 	 
	 	 	 	 
	 	By:  	                               HSRE-Campus Crest I, LLC, a Delaware limited
 	 
	 	 	liability company, its sole member 	 
	 	 	 	 
	 	By:  	

Campus Crest Ventures III, LLC, a Delaware limited
 	 
	 	 	liability company, a member 	 
	 	 	 	 
	 	By:  	                                               Campus Crest Properties, LLC, a North
 	 
	 	 	Carolina limited liability company, its Manager 	 
	 	 	 
	 	By:  	/s/ Michael S. Hartnett	 
	 	 	Michael S. Hartnett, Manager 	 
	 	 	 	 
	 	LENDER:

AMEGY MORTGAGE COMPANY, L.L.C.

d/b/a Q10 Amegy Mortgage Capital, a Texas

limited liability company

 	 
	 	By:  	/s/ Don Hickey
 	 
	 	 	Don Hickey, Senior Vice President — 	 
	 	 	Commercial Real Estate Lending 	 
	 

24

 

EXHIBIT
A

LEGAL DESCRIPTION

     All that certain tract or parcel of land lying and situated in Walker County, Texas, within
the ELIHU DAVIDS SURVEY, ABSTRACT NO. 157, being all of that certain 19.32 acre tract which was
conveyed from Stephen H. Dawson to Gerald S. Calvert by deed dated August 26, 1998 and recorded in
Volume 361, on Page 781 of the Official Records of Walker County, Texas, being out of and a part of
Lot 1 and Lot 2 of Brookwood Villa, the official plat of which was found of record in Volume 3, on
Page 48 of the Map and Plat Records of Walker County, Texas, to which reference is hereby made for
any and all purposes, being described by metes and bounds as follows, to wit:

     BEGINNING
at the Northeast corner of the above referred to 19.32 acre tract and of the above
referred to Brookwood Villa, same being the Northwest corner of The Village at Sam Houston, the
official plat of which was found of record in Volume 4, on Page 32 of the Map and Plat Records of
Walker County, Texas, being an angle corner in the South boundary line of Fraternity Row
Subdivision, the official plat of which was found of record in Volume 4, on Page 5 of the Map and
Plat Records of Walker County, Texas, and further being the Northeast corner of the said Davids
Survey, the Northwest corner of the T. Gibbs Survey, Abstract No. 220, and lying on the South
boundary line of the P. Gray Survey, Abstract No. 24, a concrete monument found (broken) for corner
from which a fence corner bears N 25°48’ E 0.30 feet, a
fence end bears S 02° 17’ E 11.88 feet, a
29” Pine bears S 11°46’ W 21.83 feet, and a 17” Pine bears N 20° 10’ W 62.51 feet;

     THENCE S 03° 13’ 48” E with the East boundary line of the above referred to 19.32 acre tract
and Brookwood Villa, along the West boundary line of The Village at Sam Houston, and with the
apparent common boundary between the Davids and Gibbs Surveys, at 169.71 feet a 1/2” iron rod was
found 0.23 feet (perpendicular) to the right, at 239.67 feet a 1/2” iron rod was found 0.26 feet
(perpendicular) to the right, at 289.86 feet a 1/2” iron rod was found 0.31 feet (perpendicular) to
the right, at 339.69 feet a 1/2” iron rod was found 0.48 feet (perpendicular) to the right, at
409.79 feet a 1/2” iron rod was found 0.56 feet (perpendicular) to the right, at 520.88 feet a 1/2”
iron rod was found 0.54 feet (perpendicular) to the right, at 579.69 feet a 1/2” iron rod was found
0.45 feet (perpendicular) to the right, and in all 661.28 feet to the Southeast corner of said
19.32 acre tract, being also the Northeast corner of that certain 0.232 acre tract which was
conveyed from Sherri F. Dixon to Laura K. Burleson by deed dated May 28, 1998 and recorded in
Volume 352, on Page 189 of the Official Records of Walker County, Texas, same being the Northeast
corner of the South Park Addition, the official plat of which was found of record in Volume 195, on
Page 669 of the Deed Records of Walker County, Texas, a 1/2”
iron rod found for corner from which a
fence corner bears N 46° 44’ E 0.78 feet and a 1/2”
iron rod found bears S 87° 43’ 47” W 82.04 feet;

     THENCE S 87° 20’ 09” W with the South boundary line of the above referred to 19.32 acre tract
and Brookwood Villa, with the North boundary line of said South Park Addition, in part with the
North boundary line of said 0.232 acre tract, in part with the North boundary line of that certain
lot which was conveyed, without acreage recitation, from Patty A. Bilhartz, et al, to Michael Wayne
Stewart, et ux, by deed dated August 25, 1997 and recorded in Volume 325, on Page 596 of the
Official Records of Walker County, Texas, in part with the North boundary line of that certain lot
which was conveyed, without acreage recitation, to Gregory Balke, et ux, by deed found of record in
Volume 341, on Page 553 of the Deed Records of Walker County, Texas, in part with the North
boundary line of that certain 0.245 acre tract which was conveyed from Sharon Rene Hayden
Carpenter, et al, to Wesley Franks, et ux, by deed dated February 25, 2003 and recorded in Volume
552, on Page 203 of the Official Records of Walker County, Texas, in part with the North boundary
line of that certain tract which was conveyed, without acreage recitation from Wm. Louis White to
WLW Trust by deed dated January 1, 1997 and recorded in Volume 306, on Page 343 of the Official
Records of Walker County, Texas, in part with the North boundary line of that certain tract which
was conveyed, without acreage recitation, from G. A. White to William Roger Allen, et ux, by deed
dated February 6, 1982 and recorded in Volume 390, on Page 664 of the Deed Records of Walker
County, Texas, in part with the North boundary line of that certain tract which was conveyed
without acreage recitation from Candelario Diaz, et ux, to Jose Angel Salazar by deed dated April
20, 2005 and recorded in Volume 686, on Page 494 of the Official Records of Walker County, Texas,
in part with the North boundary line of that certain tract which was conveyed without acreage
recitation from Michael Whitley, et ux, to Narcelle Burns by deed dated November 17, 2006 and
recorded in Volume 782; on Page 1 of the Official Records of Walker County, Texas, in part with the
North boundary line of that certain tract which was conveyed without acreage recitation from David
R. Gilbertson, et al, to Danny R. Pruett, et al, by deed dated October 13, 2006 and recorded in
Volume 776, on Page 773 of the Official Records of Walker County, Texas, and in part with the North
boundary line of Lots 2-A (0.237 acres) and 3-A (0.237 acres) both of which are depicted in

 

 

Affidavit of Minor Plat by Stanley D. Watson, et ux, dated October 4, 2002 and recorded in
Volume 532, on Page 144 of the Official Records of Walker County, Texas, and in part with the North
boundary line of that certain tract which was conveyed from Jesse Castellano, Jr., et ux, to
Jeffrey Durham, et ux, by deed dated May 31, 2007 and recorded in Volume 809, on Page 428 of the
Official Records of Walker County, Texas, at 314.87 feet a 1/2” iron rod was found 0.22 feet
(perpendicular) to the left, at 399.63 feet a 1/2” iron pipe was found -0.35 feet (perpendicular)
to the left, at 459.57 feet a 1/2” iron pipe was found 0.49 feet (perpendicular) to the left, at
544.70 feet a 1/2” iron rod was found 0.37 feet (perpendicular) to the left, at 630.11 feet a 1/2”
iron rod was found 0.50 feet (perpendicular) to the left, at 709.70 feet a 1/2” iron rod was found
0.03 feet (perpendicular) to the left, at 792.23 feet a
1/2” iron rod was found 0.06 feet
(perpendicular) to the left, at 874.76 feet a 1/2” iron rod was found 0.19 feet (perpendicular) to
the left, at 959.42 feet a 1/2” iron pipe was found 0.24 feet (perpendicular) to the left, at
1019.60 feet a 1/2” iron rod was found 0.50 feet (perpendicular) to the left, and in all 1137.75
feet to the Southwest corner of said 19.32 acre tract, being also the Northwest corner of said
South Park Addition, a 1/2” iron rod found for corner in the East boundary line of that certain
1.00 acre tract which was conveyed from Catherine Craig to D. W. Smith, et ux, by deed dated August
22, 1996 and recorded in Volume 293, on Page 265 of the Official Records of Walker County, Texas,
from which a fence corner bears N 10 34’ W 0.66 feet;

     THENCE N 02° 37’ 24” W with West boundary line of the above referred to 19.32 acre tract and
of Brookwood Villa, in part with the East boundary line of said Smith 1.00 acre tract, in part with
the East boundary line of that certain 1 acre tract which was conveyed from Norman Glen Molitor, et
ux, to Terry Williams, et ux, by deed dated June 18, 1981 and recorded in Volume 380, on Page 102
of the Deed Records of Walker County, Texas, in part with the East boundary line of that certain 1
acre tract which was conveyed from Viola Goines to Larry Wayne Goines, et ux, by deed dated January
26, 1994 and recorded in Volume 213, on Page 855 of the Official Records of Walker County, Texas,
in part with the East boundary line of that certain tract which was conveyed, without acreage
recitation, from Joe.H. Rash, et ux, to Viola Goines, et al, by deed
dated February 15, 1995 and
recorded in Volume 244, on Page 538 of the Official Records of Walker County, Texas, and in part
with the East boundary line of that certain tract which was conveyed, without acreage recitation,
from Joe.H. Rash, et ux, to Viola Goines, et al, by deed dated February 8, 1995 and recorded in
Volume 244, on Page 535 of the Official Records of Walker County, Texas, at 161.22 feet a point
lies 2.35 feet (perpendicular) to the left from which a 22” Sweetgum bears N 55° 04’ W 12.19 feet,
and continuing in all 425.16 feet to an ell, or re-entrant corner of said 19.32 acre tract, same
being the Northeast corner of the above mentioned Goines (244/535) tract, a 1/2” iron rod found for
corner from which a fence corner bears S 43° 21’ W 0.41 feet and a 24” Pine bears S 48° 00’ E 1.93
feet;

     THENCE S 87 42’ 20” W with Goines North boundary line, common to one South boundary line of
the above referred to 19.32 acre tract and of Brookwood Villa, 327.47 feet to a Southwest corner of
said 19.32 acre tract and the Southeast corner of that certain tract which was conveyed, without
acreage recitation, from Nathan Allen Dickerson to Larry W. Goines by deed dated March 16, 2005 and
recorded in Volume 692, on Page 313 of the Official Records of Walker County, Texas, a 1/2” iron
rod found for corner from which a fence corner bears N 26° 49’ E 0.36 feet and a 26” Pine bears N
29° 52’ E 4.65 feet;

     THENCE N 01° 17’ 50” W with one West boundary line of the above referred to 19.32 acre tract
and of Brookwood Villa, common with Goines (692/313) East boundary line, 92.53 feet to a 5/8” iron
rod found for Goines Northeast corner, at fence corner;

     THENCE S 86° 51’ 24” W with Goines North boundary line, common to one South boundary line of
the above referred to 19.32 acre tract, 149.55 feet to the West-Southwest corner of said 19.32 acre
tract and of Brookwood Villa, being also the Northwest corner of last named Goines tract, a 1/2”
iron rod found for corner on the East right of way line of Sycamore Street, from which a fence
corner bears S 03° 55’ W 0.46 feet, a utility pole bears N 06° 51’ E 4.13 feet, City of Huntsville
Survey Control Point No. 6325 bears S 01° 24’ 26”
W 595.62 feet, and City of Huntsville Survey
Control Point No. 6316 bears S 03° 12’ 58” E 1430.73 feet;

     THENCE N 02° 52’ 14” W with the West boundary line of the above referred to 19.32 acre tract
and of Brookwood Villa, same being the East right of way line of Sycamore Street, 106.93 feet to a
1/2” iron pipe set for corner in the West boundary line of Lot 1 of Brookwood Villa, from which a
5/8” iron rod found bears S 02° 32’ 47” E
20.97 feet, a utility pole bears N 43° 54’ E 2.66 feet,
and a 1/2” iron rod found bears N 02° 52’ 14” W 565.05 feet;

 

 

     THENCE N 87° 19’ 31” E severing Lot 1 of Brookwood Villa, 220.40 feet to a 1/2” iron pipe set
for corner in the East boundary line thereof, common with the West boundary line of Lot 1 of same,
from which a 60d nail found bears S 02° 49’ 21” E 19.28 feet;

     THENCE N 02° 49’ 21” W with last named boundary, 42.86 feet to a 1/2” iron pipe set for
North-Northwest corner of the above referred to 19.32 acre tract, in the apparent boundary common to
the said Davids and Gray Surveys, from which a fence corner bears S 34° 36’ W 0.66 feet, a 5/8”
iron rod found bears S 76° 26’ 16” W 2.96 feet, a utility pole bears S 80° 58’ W 9.87 feet, and a
5/8” iron rod found bears N 03° 01” 56” W 523.90 feet;

     THENCE N 87° 37’ 47” E with the North boundary line of the above referred to 19.32 acre tract
and of Brookwood Villa, common with the South boundary line of that certain 20 acre tract which was
conveyed from Geo. W. Grant to State of Texas by deed dated July 8, 1885 and recorded in Volume Z,
on Page 550 of the Deed Records of Walker County, Texas, same being the apparent boundary common to
the said Davids and Gray Surveys, and in part along the South boundary line of said Fraternity Row
Subdivision, at 838.49 feet a fence comer lies 7.65 feet (perpendicular) to the right, at 838.62
feet a fence corner lies 2.74 feet (perpendicular) to the right, at 840.28 feet a 1/2” iron rod was
found 1.24 feet (perpendicular) to the right, at 1008.63 feet a 1/2” iron rod was found 0.83 feet
(perpendicular) to the right, and in all 1385.84 feet to the
place of beginning containing 19.397
acres of land, more or less.

Basis of Bearings:          The Texas State Plane Coordinate System, Central Zone.

 

 

Exhibit “B-1”

Draw Request

	 	 	 	 	 

	Loan
Amount:
	 	 	 	 
	 

	 	 	 	 
	Loan Number:
	 	 	 	 
	 

	 	 	 	 
	Borrower:
	 	 	 	 
	 	 	 
	Project Name:
	 	 	 	 
	 	 	 
	General Contractor:
	 	 	 	 
	 	 	 
	Draw Request Number:
	 	 	 	 
	 

	 	 	 	 
	Draw Request Date:
	 	 	 	 
	 

	 	 	 	 
	Draw Period Ending:
	 	 	 	 
	 

	 	 	 	 
	Dear Lender:
	 	 	 	 

Pursuant to the terms of the loan agreement (the “Loan Agreement”) for the above referenced Loan,
Borrower requests an advance as follows:

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Current	 	 	Previously	 	 	 	 	 	 	Remaining	 
	 	 	Approved	 	 	Approved	 	 	Amount of this	 	 	Budget After	 
	 	 	Budget	 	 	Advances	 	 	Request	 	 	Request	 
	 	 	 
	Sources of Funds:
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Loan Proceeds:
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Construction Loan Proceeds
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	 	 	 
	Total Loan Proceeds
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Equity Proceeds:
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Borrower’s Equity
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	 	 	 
	 Total Equity Proceeds
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Total Sources of Funds:
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	 
	Uses of Funds:
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Land:
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Land Cost
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	 	 	 
	Total Land
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Construction Allocation (See Note):
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Construction Contracts
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	 	 	 
	Total Construction Allocation
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Non Construction Allocation:
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Architect/ Engineer
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	Property Taxes
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	Insurance
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	Title Policy & Closing Costs
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	Lender Fees
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	Interest Reserve
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	 	 	 
	Total Non Construction Allocation
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Total Uses of Funds:
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 

 

*          Note:  Each AIA Form G702, or other form approved by Lender, should be totaled on a
separate line and attached)

 

 

Exhibit “B-2”

Draw Certification

     The undersigned certifies that he/she is authorized to execute this Draw Request and Draw
Certification on behalf of the Borrower. For purposes of this certification, (a) the term “Plans
and Specifications” shall mean the plans, specifications or other documents which define the scope
of work to construct or renovate improvements on the subject property, and (b) the term “Work”
shall mean improvements to be performed on the subject property in compliance with the Plans and
Specifications. The Borrower certifies, represents and warrants as follows:

     1. A review of the activities of the Borrower has been made under my supervision with a
view to determining whether the Borrower has fulfilled all of its obligations under the Loan
Agreement, and other documents executed in connection therewith
(“Other Loan Documents”). The
Borrower has performed and complied with all agreements, terms and conditions contained in the Loan
Agreement and the Other Loan Documents required to be performed or complied with prior to or at the
time of delivery hereof.

     2. The representations and warranties of the Borrower contained in the Loan Agreement
and otherwise made in writing by or on behalf of the Borrower pursuant to the Loan Agreement were
true and correct in all material respects when made, are hereby repeated as of the time of delivery
hereof, and are true and correct in all material respects as of the time of delivery of this Draw
Request and Draw Certification. In the event any such representations have changed, the manner in
which such representations have changed is set forth herein or in an attachment hereto.

     3. Since the date of execution of the Loan Agreement, no material change has occurred,
either in any instance or in the aggregate in the condition, financial or otherwise, of the
Borrower, or its properties, which would have a material adverse
effect on the Borrower.
Furthermore, the Borrower has not incurred any material liabilities since the date of execution of
the Loan Agreement, except as disclosed in writing to Lender or as reflected in Borrower’s
financial statements which have been previously delivered to Lender, but in any event, Borrower is
in full compliance with the covenants contained in the Loan Agreement and the Other Loan Documents.

     4. There exists, and, after giving effect to the Advance or Advances with respect to which
this Draw Request and Draw Certificate is being delivered, will exist, no Event of Default under
the Loan Agreement or Other Loan Documents, or any event or circumstance which constitutes, or with
notice or lapse of time (or both) would constitute, an Event of Default under any of the foregoing.

     5. To the best of the Borrower’s knowledge, there are no mechanic’s liens, liens
affidavits or encumbrances against the subject property or improvements thereon, and Borrower has
not received any notice or communication that any subcontractor, materialman or laborer has not
been paid current for all labor or materials performed or furnished in connection with any work
performed on the subject property.

     6. The sum necessary to complete all remaining Work in accordance with the Plans and
Specifications is $
                                        .

     7. There
have been no material changes in said Plans and Specifications; except as otherwise disclosed on an attachment hereto or as previously approved by Lender.

     8.                     % of the total Work has been completed.

     9. There have been no material changes in the “Approved Budget”; except as previously
approved by Lender and the remaining proceeds of the Approved Budget are sufficient

 

 

to finally and fully complete and pay for all Work.

     10. If requested by Lender, attached are “Bills Paid Affidavits” and/or true and correct
copies of the invoices for the cost of labor and materials for which this Draw Request is being
submitted.

     11. The Borrower certifies to Lender that all information contained on any attached
Application and Certificate For Payment (AIA Form G702) or other form approved by Lender
(“Application for Payment”) is true and correct and the Application for Payment contains a clear
disclosure of the funds disbursed by Lender since the previous Draw Request submitted to Lender.

     12. All sums previously advanced by Lender and advanced pursuant hereto have been and will
be used by Borrower solely for the purpose of paying the obligations owing by Borrower as set forth
in this Draw Request for Borrower profit and overhead, and for no other purpose.

     13. Borrower has paid, or will pay contemporaneously with the advance made by Lender
pursuant to this Draw Request, for all labor or materials furnished
in connection with the Work.

     14. All Work performed to the date of this Draw Request has been performed in a good and
workmanlike manner in substantial conformance with the Plans and Specifications.

     15. All
Work has been performed in strict compliance with all applicable ordinances,
statutes, regulations and subdivision requirements or restrictions that affect the subject
property.

     NOTICE TO BORROWER: YOU SHOULD NOT EXECUTE THIS DOCUMENT UNLESS READ, UNDERSTAND AND AGREE TO THE
ABOVE CERTIFICATIONS REGARDING YOUR SATISFACTION WITH AND UNDERSTANDING OF THE INFORMATION SET
FORTH IN THE DRAW REQUEST. DOCUMENTATION SUPPORTING THE LENDER’S DISBURSEMENT OF FUNDS PURSUANT TO
THE AGREEMENT FOR THE PERIOD SINCE THE LAST DRAW REQUEST IS AVAILABLE AT THE LENDER’S OFFICES FOR
YOUR REVIEW, IF YOU SO DESIRE, PRIOR TO YOUR EXECUTING THIS DOCUMENT. LENDER IS NOT RESPONSIBLE FOR
THE ACCURACY OF THE INFORMATION CONTAINED IN THIS DRAW REQUEST.

	 	 	 	 	 
	 	CAMPUS CREST AT HUNTSVILLE, LP, a Delaware limited partnership

 	 
	 	By:  	HSRE-CC Huntsville GP, LLC, a Delaware limited liability company, its General Partner
 	 

	 	 	 	 	 
	 	By:  	HSRE-Campus Crest I, LLC, a Delaware limited liability company, its sole member
 	 

	 	 	 	 	 
	 	By:  	Campus Crest Ventures III, LLC, a Delaware limited liability company, a member
 	 

	 	 	 	 	 
	 	By:  	Campus Crest Properties, LLC, a  North Carolina limited liability company, its Manager
 	 

	 	 	 	 	 
	 	By:  	 	 
	 	 	Michael S. Hartnett, Manager 	 
	 	 	 	 
	 

 

 

	• AiA Document G702/CMaTM-1992
Application and Certificate for Payment Construction Manager-Adviser Edition___

	TO OWNER: ; r PROJECT: ‘ “
‘ “ APPLICATION NO: , ¦” . ”
Pistributiontc
        , ‘ ‘•• PERIOD
TO; OWNER P
•"•• *’ CONSTRUCTION MANAGER
VIA CONSTRUCTION CONTRACTOR: ./ ARCHITECT P
FROM .v ‘: MANAGER:
CONTRACT DATE: CONTRACTOR _
CONTRACTOR^ ‘ VIA ARCHITECT: PROd-CTNOS:
/ ! FIELD _
‘ :.. “¦’ OTHER L
rnNTRArTHR1^ APPi IPATION FOR PAYMFNT -_Thc undersigned ContractarcertiF^
IAIN i nH\s I UK ___AKHJUAIIUIN run ra I IVICIN I CObclicf the Work
covered by this Application for Payment has been completed in accordance with ll
Application is made for payment, as shown beiow, in’connection, urith Hie
Contract SD Contract Documents, that aU amounts havtj been paid by the Contractor
for Work for which previot
Coulimintion Sheet, MA Document G703, is attached. ^ CeniJjcnics for Payment were issued
and payments received from the Owner, and that currc:
1. ORIGINAL CONTRACT SUM.....S 13 WTM"1 sllown
herdn *» now dut”
2. Net change by Change Orders...___S_CD CONTRACTOR:
3. CONTRACT SUNUO DATE (Line 1 ± 2)...-,W,,...,...•¥_Q^y: ___
,11
4. TOTAL COMPLETED & STORED TO DATE fCqliiiiiii 0 on G703) ..’... $,_p Slate of:
t ./; ’ ‘"' i*
S.flETAWAGE: ; i’; -5. £2 County ofc
¦ , j’”.”1, '' ’ S
a. _% of Completed Work ¦’ ^ Subscribed and swam to before .. —
CCohuiwD+EohC_g>*j’ s___2
wclhis d°yoF ,i .%.>‘” C
b._ft,of Stored fvla&irii -j Notary PubHc '''' V
(Column.F=piV.6’703)B,: S___My Commission
expires::___J_
Total Kkti\n°i(Lines 5a + 5b or Total i” Column 1 of G7031S_q CERTIF1CAT£;P0R
payment
In accordance with’Ihc Contract Documents, based on on-site observations and the data cotupmii
TO-., CAOUFn i pt?<5 RFTaihfirF S —h this appl’rcsiion,
die Construction Muriager and Architect certify to the Owner tliaUo tlie best of tlx
b. IU i al fcAHNtu Ltas H- I Aiiwtac ..... O knowledge, information
and belief the Work lias progressed us indicated, the quality of ll.e Wbi* is
(Line 4.Lcss Line 5 Total) . —\ accorcinnce with the
ContaiciDocuincnte, and Hie Contractor is entitled to payment of the. AMOTJ>
7. LESS PREVIOUS CERTIFICATES FOR PAYMENT..,...5-— CERT1HED.
(Line C from prior Certificate) _
8. CURRENT PAYMENT DUE .is $3 AMOUNT CERTIFIED...- S-___
CO (Attach explanation ifamount certified differs from ]he amowit applied, initial all figures on
tins . 2. BALANCE TO FINISH, INCLUDING RETA1NAGE CO Application ad an the Caallmtation
Steer that« c/wng*/ to conform wldi the amount certified.)
<Uh3 less Line6) $___CONSTRUCTIONfflANAGEB: ^ -:
___/( :,\___By: _, ,¦” V; Kate:___
CHANGE ORDER SUMMARY ; "\ * ‘ | ADDITIONS
|"^EDUCTIQNSJ ARCHITECT: ‘
totai changes approved in previous iritfnihs by Owner — s ‘ ^
\ :’ ,v‘
Total approved this Month ~ s $ This Ccnirvcate is not
negotiuble;.,,Tl.ie AMOUNT CERTIFIED is payable only to the Contract
—+-TOTALS 1-?- named herein. Issuance,, payment atid acceptance of pnymcjit are without
prejudice to any rights
___
‘_—.—L*- ihc Owner or Contractor, under this Comract
NET CHANGES by Change Order ___|S___I
‘f: S ‘
AlA OBcumunt GTOS/CTMjTM ___)992. CopyrlglH <S 1993 by The Amsrisan Institute ol Architects.
All rights reservei!. WARNING: This AIA* Document is protoclod by U.S. Cqpyrigfu Law and
Intematlonaf Treaties. UnDUOi.orfced reproduclion or distribuHon o! this AlA* document,
or any portion of It, may result In severo civil and criminal penalllris, snd win be prosncjted
tolho maximum extent —... ,;.,, ,..,, t5,,,,!,,rB,t ,,» nofmii:tvl lomnmduc* len
flOlcouies ot tWs iJccumcntvvhencompteied. Tc ropon copyiicthl iHolsiioiis a( AlA. Contract
Documents, s-msit Tfie American tnsiilulaol

 

	 	 	 

	

	 	Document
G702/CMaTM
— 1992 Instructions

Application
and Certificate for Payment Construction Manager-Adviser Edition

A. General Information

AIA Document G702/CMa, Application and Certificate for Payment, Construction Manager-Adviser
Edition, is to be used in conjunction with AIA Document G703,
Continuation Sheet. These documents
are designed to be used on a Project where a Construction Manager is employed as an adviser to the
Owner, but not as a constructor, and where multiple Contractors have direct Agreements with the
Owner. Procedures for their use are covered in AIA Document A201/CMa, General Conditions of the
Contract for Construction, Construction Manager-Adviser Edition, 1992 Edition.

B. Reproductions

This document is a copyrighted work and may not be reproduced or excerpted from without the express
written permission of the AIA. There is no implied permission to reproduce this document, not does
membership in The American Institute of Architects confer any further rights to reproduce this
document.

The AIA hereby grants the purchaser a limited license to reproduce a maximum of ten copies of a
completed G702/CMa, but only for use in connection with a particular project. The AIA will not
permit reproduction outside of the limited license for reproduction granted above, except upon
written request and receipt of written permission from the AIA.

Rights to reproduce the document may vary for users of AIA software. Licensed AIA software users
should consult the End User License Agreement (EULA). To report copyright violations of AIA
Contract Documents, e-mail The American Institute of Architects’ legal counsel, copyright@aia.org.

C. Completing the G702/CMa Form

After the Contractor has completed AIA Document G703, Continuation Sheet, summary Information
should be transferred to AIA Document G702/CMa, Application and Certificate for Payment,
Construction Manager-Adviser Edition.

The Contractor should sign G702/CMa, have it notarized and submit it, together with G703, to the
Construction Manager and Architect.

The Construction Manager and Architect should review G702/CMa and G703 and, if they are acceptable,
complete the Certificate for Payment on G702/CMa. The Construction Manager and Architect may
certify a different amount than that applied for pursuant to Sections 9.5 and 9.6 of A201/CMa. They
should then initial all figures on G702/CMa and G703 that have been changed to conform to the
amount certified and attach an explanation. The completed G702/CMa and G703 should be forwarded to
the Owner.

D. Completing the G703 Form

Heading: This information should be completed to be consistent with similar information on AIA
Document G702/CMa, Application and Certificate for Payment, Construction Manager-Adviser Edition.

Columns A, B & C: These columns should be completed by identifying the various portions of the
Project and their scheduled value consistent with the schedule of values submitted to the Architect
at the commencement of the Project or as subsequently adjusted. The breakdown may be by sections of
the Work or by Subcontractors and should remain consistent throughout the Project. Multiple pages
should be used when required.

Column C should be subtotaled at the bottom when more than one page is used and totaled on the last
page. Initially, this total should equal the original Contract Sum. The total of column C may be
adjusted by Change Orders during the Project.

Column D: Enter in this column the amount of completed work covered by the previous application
(columns D & E from the previous application). Values from column F (Materials Presently Stored)
from the previous application should not be entered in this column.

Column E:
Enter here the value of Work completed at the time of this  application, including the value of
materials incorporated into the project which were listed on the previous application under
Materials Presently Stored (column F).

Column F: Enter here the value of Materials Presently Stored for which payment is sought. The total
of the column must be recalculated at the end of each pay period. This value covers both materials
newly stored for which payment is sought and materials previously stored which are not yet
incorporated into the Project. Mere payment by the Owner for stored materials does not result in a
deduction from this column. Only as materials are incorporated into the Project is their value
deducted from this column and incorporated into column E (Work Completed – This Period).

Column G:
Enter here the total of columns D, E and F. Calculate the percentage
completed  by dividing column G
by column C.

Column H: Enter here the difference between column C (Scheduled Value) and column G (Total
Completed and Stored to Date).

Column I: This column is normally used only for contracts where variable retainage is permitted on
a line-item basis. It need not be completed on projects where a constant retainage is withheld from
the overall contract amount.

Change Orders: Although Change Orders could be incorporated by changing the schedule of values each
time a Change Order is added to the Project, this is not normally
done. Usually, Change Orders are
[ILLEGIBLE] separately, either on their own G703 from or at the end
of the basis schedule. The amount of the original contract adjusted by Change Orders is to be
entered in the appropriate location on the G702/CMa form.

Construction Change Directives: Amounts not in dispute that have been included in Construction
Change Directives should be incorporated into one or more Change Orders. Amount remaining in
dispute should be dealt with according to Section 7.3 in A201/CMa.

E. Making Payment

The Owner should make payment directly to the Contractor based on the amount Certified by the
Construction Manager and Architect on AIA Document G702/CMa, Application and Certificate for
Payment, Construction Manager-Adviser Edition. The completed from contains the name and address of
the Contractor. Payment should not be made to any other party unless specifically indicated on
G702/CMa.

AIA Document G702/CMaTM – 1992, Copyright © 1992 by The American Institute of
Architects. All rights reserved. WARNING: This AIA® Document is protected by U.S. Copyright Law and
International Treaties. Unauthorized reproduction or distribution of
this AIA® Document, or any
portion of it, may result in severe civil and criminal penalties and will be prosecuted to the
maximum extent possible under the law. Purchasers are permitted to reproduce ten (10) copies of
this document when completed.

 

  Document G703TM — 1992

Continuation Sheet

	 	 	 

	AIA Document G702, APPLICATION AND CERTIFICATION FOR PAYMENT,

	 	APPLICATION NO:
	containing Contractor’s signed certification is attached.

	 	APPLICATION DATE:
	In tabulations below, amounts are stated to the nearest dollar.

	 	PERIOD TO:
	Use Column I on Contracts where variable retainage for line items may apply.

	 	ARCHITECT’S PROJECT NO:

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	A	 	B	 	C	 	D	 	E	 	F	 	G	 	H	 	I
	 	 	 	 	 	 	WORK COMPLETED	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	FROM PREVIOUS	 	 	 	MATERIALS	 	TOTAL COMPLETED AND	 	 	 	 	 	 
	ITEM	 	DESCRIPTION	 	SCHEDULED	 	APPLICATION	 	 	 	PRESENTLY STORED	 	STORED TO DATE	 	%	 	BALANCE TO FINISH	 	RETAINAGE
	NO.	 	OF WORK	 	VALUE	 	(D + E)	 	THIS PERIOD	 	(NOT IN D OR E)	 	(D+E+F)	 	(G ÷ C)	 	(C - G)	 	(IF VARIABLE RATE)
	 

	 	 	 	 	 	 	 	Sample	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	Document not	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	for Usage	 	 	 	 	 	 	 	 	 	 

CAUTION: You should sign an original AIA Contract Document, on which this text appears in RED.
An original assures that changes will not be obscured.

AIA
Document
G703TM
– 1992. Copyright(C) 1963, 1965, 1966, 1967, 1970, 1978, 1983 and
1992 by The American Institute of Architects. All rights reserved. WARNING: This AIA° Document is
protected by U.S. Copyright Law and International Treaties. Unauthorized reproduction or
distribution of this AIA° Document, or any portion of it, may result in severe civil and criminal
penalties, and will be prosecuted to the maximum extant possible under the law. Purchasers are
permitted to reproduce ten (10) copies of this document when completed. To report copyright
violations of AIA Contract Documents. e-mail The American Institute
of Architects’ legal.

 

 

	 	 	 

	
	 	Document G703TM— 1992

Continuation Sheet

GENERAL INFORMATION

Purpose
and Related Documents. AIA Document G702, Application and Certificate for Payment, is to be
used in conjunction with AIA Document G703, Continuation Sheet. These
documents are designed for
use on Projects where the Contractor has a direct Agreement with the Owner. Procedures for their
use are covered in AIA Document A201, General Conditions of the Contract for Construction.

Use of
Current Documents. Prior to using any AIA Contract Document, users should consult
www.aia.org or a local AIA component to verify the most recent edition.

Reproductions. This document is a copyrighted work and may not be reproduced or excerpted from
without the express written permission of the AIA; There is no implied permission to reproduce this
document, nor does membership in The American Institute of Architects confer any further rights to
reproduce this document. The AIA hereby grants the purchaser a limited license to reproduce a
maximum of ten copies of a completed G703, but only for use in connection with a particular
project. The AIA will not permit reproduction outside of the limited license for reproduction
granted above, except upon written request and receipt of written
permission from the AIA. Rights
to reproduce The document may vary for users of AIA software. Licensed AIA software users should
consult the End User License Agreement (EULA). To report copyright violations of AIA Contract
Documents, e-mail The American Institute of Architects’ legal
counsel, copyright@aia.org.

COMPLETING
THE G703 FORM

Heading:
This information should be completed in a manner consistent with similar information on
AIA Document G702, Application and Certificate for Payment.

Columns A, B & C: These columns should be
completed by identifying The various portions of the Project and their scheduled values consistent
with the schedule of values submitted to the Architect at the commencement of the Project or as
subsequently adjusted. The breakdown may be by sections of the Work or by Subcontractors and should
remain consistent throughout the Project. Multiple pages should be used when required.

Column C
should be subtotaled at the bottom when more than one page is used and totaled on the last
page. Initially, this total should equal the original Contract Sum.
The total of column C may be
adjusted by Change Orders during the Project.

Column D:
Enter in this column the amount of completed Work covered by the previous application
(columns D & E from the previous application). Values from column F (Materials Presently Stored)
from the previous application should not be entered in this column.

Column E:
Enter here the value of Work completed at the time of this application, including the
value of materials Incorporated in the project that were listed on
the previous application under
Materials Presently Stored (column F).

Column F: Enter here the value of Materials Presently Stored for which payment is sought. The total
of the column must be recalculated at the end of each pay period. This value covers both materials
newly stored far which payment is sought and materials previously stored which are not yet
incorporated into the Project. Mere payment by the Owner for stored materials does not result in a
deduction from this column. Only as materials are incorporated into the Project is their value
deducted from this column and incorporated into column E (Work Completed—This Period.)

Column G:
Enter here the total of columns D, E and F. Calculate the percentage
completed by dividing column G by column C;

Column H:
Enter here the difference between column C (Scheduled Value) and
column G (Total Completed and Stored to Date).

Column I:
This column is normally used only for contracts where variable
retainage is permitted on a
line-item basis. It need not be completed on projects where a constant retainage is withheld from
the overall contract amount.

Change
Orders: Although Change Orders could be incorporated by changing the schedule of values each
time a Change Order is added to the Project, this is not normally
done. Usually, Change Orders are
listed separately, either on their own G703 form or at the end of the basic schedule. The amount of
the original contract adjusted by Change Orders is to be entered in the appropriate location on the
G702 form.

Construction
Change Directives: Amounts not in dispute that have been included in Construction
Change Directives should be Incorporated into one or more Change Orders. Amounts remaining in
dispute should be dealt with according to Section 7.3 in A201.

The
following is an example of a Continuation Sheet for work in progress. Please note that dollar
amounts shown below are for illustrative purposes only, and are not intended to reflect actual
consturction costs.

	
 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	A	 	B	 	C	 	D	 	 	E	 	F	 	 	G	 	 	 	 	H	 	I	 
	 	 	 	 	 	 	 	WORK COMPLETED	 	MATERIALS	 	 	TOTAL	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	PRESENTLY	 	 	COMPLETED	 	 	 	 	BALANCE	 	 	 
	 	 	 	 	 	 	 	FROM PREVIOUS	 	 	 	 	 	STORED	 	 	AND STORED	 	 	 	 	TO	 	RETAINGE	 
	ITEM	 	 	 	SCHEDULED	 	APLICATION	 	 	 	 	 	NOT IN	 	 	TO DATE	 	%	 	FINISH	 	(IF VARIABLE	 
	NO.	 	DESCRIPTION OF WORK	 	VALUE	 	(D+E)	 	 	THIS PERIOD	 	D OR E	 	 	(D+E+F)	 	(G ÷ C)	 	(C - G)	 	RATE)	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	1
	 	MOBILIZATION	 	 	5,000	 	 	5,000	 	 	 	0	 	 	0	 	 	 	5,000	 	 	100	 	 	0	 	 	 	 
	2
	 	STUMP REMOVAL	 	 	5,000	 	 	5,000	 	 	 	0	 	 	0	 	 	 	5,000	 	 	100	 	 	0	 	 	 	 
	3
	 	EARTH WORK	 	 	15,000	 	 	10,000	 	 	 	5,000	 	 	0	 	 	 	15,000	 	 	100	 	 	0	 	 	 	 
	4
	 	LOWER RETAINING WALL	 	 	10,000	 	 	0	 	 	 	5,000	 	 	0	 	 	 	5,000	 	 	50	 	 	5,000	 	 	 	 
	5
	 	CURBS & MISC CONC	 	 	5,000	 	 	0	 	 	 	0	 	 	0	 	 	 	0	 	 	0	 	 	5,000	 	 	 	 
	6
	 	PAVING, UPPER DRIVE	 	 	20,000	 	 	0	 	 	 	0	 	 	0	 	 	 	0	 	 	0	 	 	20,000	 	 	 	 
	7
	 	PAVING, LOWER DRIVE	 	 	20,000	 	 	0	 	 	 	0	 	 	0	 	 	 	0	 	 	0	 	 	20,000	 	 	 	 
	8
	 	PAVERS	 	 	20,000	 	 	0	 	 	 	0	 	 	10,000	 	 	 	10,000	 	 	50	 	 	10,000	 	 	 	 
	9
	 	BRICK WORK	 	 	5,000	 	 	0	 	 	 	0	 	 	0	 	 	 	0	 	 	0	 	 	5,000	 	 	 	 
	10
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	11
	 	 	 	 	105,000	 	 	20,000	 	 	 	10,000	 	 	10,000	 	 	 	40,000	 	 	 	 	 	65,000	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

AIA Document G703TM-1992. Copyright © 1963, 1965, 1966, 1967, 1970, 1978, 1983
and 1992 by The American Institute of Architects. All rights
reserved. WARNING: This AIA ® Document
is protected by U.S. Copyright Law and International Treaties. Unauthorized reproduction or
distribution of this AIA ® Document, or any portion of it, may result in severe civil and
criminal penalties, and will be prosecuted to the maximum extent possible under the law. Purchasers
are permitted to reproduce ten (10) copies of this document when completed. To report copyright
violations of AIA Contract Documents, e-mail The American Institute of Architects legal
counsel, copyright@aia.org.

 

 

	#AIA Document G702TM -1992
Application and Certificate for Payment___• _‘
TO OWNER; “ PROJECT:
APPLICATION NO;; v” Sr* Distribution to:
        . ,.. ; \V? “
PERIOD TO; OWNER ?
CONTRA’CTFOR: ARCHITECT ?
FROM CONTRACTOR: VIA ARCHITECT:
^§j’f &CT DATE: CONTBACTOR ?
‘PROJECT NOS: y / f|ELD Q
___,_OTHER ?
CONTRACTOR’S APPLICATION FOR PAYMENT ^J The
undersigned Contractor certifies tfcnc 10 ilia best of ihe Contractor’s knowledge, information
. ,. ,¦ j T 1. »». ¦ .- -.1
v . mid belief the’Work covered.by this Application for Payment has
been completed in accordance
Application is made for payment, as shown below, in connection with be Contract.
~3 ‘,. ,. ,, , ^ ¦ .,11 = 11 . < t ¦ 1 i.
1 o . . c m i
.. ,,. .r, rf TM>>i • t ¦
13 with the Contract DocumcAls, Uist all amounts Iwc been paid by the
Contractor wr Work lor
Continuation Sheet, AIA Document £3703. ts attached.
^ whkb ^vious Certificates, for Payment ward issued and payments
received from the Owner, and
1. ORIGINAL CONTRACT SUM S—  thai current-payment shown herein is nW due,
2. N»t change by Changs Orders...s contractor:
3. CONTRACT SUM TO DATE (Line 1 ±2)^s|v A..S By:_
        ,.-"-yi:.> Dm*___
i total completed & STORED to OATe? (Calami; G on G703). S
Q Smieof: fe.C .1” fTl
5, retain age: ‘S’’^’”. E County o£
ffVW^’
_^afComplele’tj^yorfc 3 Subscribed and sworn to bcfbjreV’
‘ —•
(Column D + liftn Q7d3) $___CD me this
daypf..y%«L:. “*’” ^
b._tft of Stored Material 2-
(Coiunu Pan 0703) S___-j Notary Public: C”, CO
q My Commission expires: £0
TotalReuinage(Lines5a + 5borTotalinColumn 1 ofO703)... $;_r+ _
6. total earned less retawages_o ARCHITECTS
CERTIFICATE FOR PAYMENT
(Line 4 Less Line 5 Tumi) ~* ‘” “ceo/dance with the Conlracr Documents, basad
on on-site observations and die data comprising
7 LESS previous CERTIFICATES POR payment . 5
CT. ^ application, the Architect certifies 10 the Owner that 10
the best o!” the Architect’s knowledge,
        , . ___.- . -m inrbraialiou anti belief
did Work has progressed as indie-died, the quality oC ttie Wovt is in
(Line 6 from pnor Certificate) _^ accordance wirb the
Contract Documents, and the Contractor is entitled to payment of the
8. current payment due..!.. |s TB
amount certified.
9. BALANCE to finish, including retainage..s -:. .-.
amount certified..’...$_
(Line 3 less Line S) ,<‘*r\ s_ (Attach explanation ijamount
curlijie/ldiffersJromihc rinoimt applied. Initial aUfiptres on this
_,,¦ ¦’ “ ___i
 Application and on Oil-
CoiiiinuaiionSlmenhar’are t&iaiig&i 10 conform wirli the amount certified.)
CHANGE order SUMMARY, ‘”;}..r___ADDITIONS DEDUCTION’S
architect: .,,..s:,-’W:’’
Tolft) changes approved’in previous’inomhs by Owner ? _S_
8y:-;Vt ~
i’~:> ___Date:
Total approved ihij Month-___3 $ “‘
—,, _j TOTALS ~$5 This Certificate is not negotiable. The
AMOUNT CERTIFIED is payable only to the Contractor
-1-:—l:—— named herein. Issuance’, payment and‘HCceptimce of
payment sire without prejudice to any rights of
KET CHANGES by Cliange Ordar___[5_) the Qwacr or Cornfeaior under tJiis Contract
AlAOoeumentG7031>,-i99i!. Capyrighl © 1953,19S3.19B3, 1371,1378.1303
anil 19S2 by Tlie American ]nstilri|Q ol Arctiileels. All rights roserved. WARNING:
This AIA* Deeumenl Is protected Uy U.S. Copyright I TM ond International Treaties.
UnauLhorizea” rBprodtrellen or distribution ol litis AtA4 Oacumfint, or any
portion of I?, may result In severe crvil and criminal pcnattles, and wilt
b£ prosecuted to tho maxi’mum extent passible under lite law. Purchasers ara
parmitted to reproduce ten (!0| copies ol Hits document whon completed. To
report copyright violations of AIA Contracl Dccumanls, a-mailTha Amorlcan Instiiuleol
Arctiftccts* legal counsel, copyriQht@ala.orn.

 

     

	 	 	 

	

	 	Document G703TM — 1992

Continuation
Sheet

	 	 	 	 	 

	AIA Document G702, APPLICATION AND CERTIFICATION FOR PAYMENT,

	 	 	 	APPLICATION NO:
	containing Contractor’s signed certification is attached.

	 	 
	 	APPLICATION DATE:
	In tabulations below, amounts are stated to the nearest dollar.

	 	 	 	PERIOD TO:
	Use
column I on contracts where variable retainage for line items may apply.

	 	 	 	ARCHITECT’S PROJECT NO:

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	A	 	B	 	C	 	D	 	E	 	F	 	G	 	H	 	I
	 	 	 	 	 	 	WORK COMPLETED	 	 	 	TOTAL	 	 	 	 	 	 
	 	 	 	 	 	 	FROM	 	 	 	MATERIALS	 	COMPLETED	 	 	 	 	 	 
	 	 	 	 	 	 	PREVIOUS	 	 	 	PRESENTLY	 	AND STORED	 	 	 	BALANCE	 	RETAINAGE
	ITEM	 	DESCRIPTION	 	SCHEDULED	 	APPLICATION	 	THIS	 	STORED	 	TO DATE	 	%	 	TO FINISH	 	(IF VARIABLE
	NO.	 	OF WORK	 	VALUE	 	(D + E)	 	PERIOD	 	(NOT IN D OR E)	 	(D+E+F)	 	(G ÷ C)	 	(C - G)	 	RATE)
	 
	 	 
	 	 
	 	 
	 	Sample

Document

not for

Usage
	 	 
	 	 
	 	 
	 	 
	 	 

CAUTION: You should sign an original AIA Contract Document, on which this text appears in RED. An
original assures that changes will not be obscured.

AIA
Document
G703TM
— 1992. Copyright © 1963, 1965, 1966, 1967, 1970, 1978, 1983 and
1992 by The American Institute of Architects. All rights reserved. WARNING: This AIA° Document is
protected by U.S. Copyright Law and International Treaties. Unauthorized reproduction or
distribution of this AIA° Document, or any portion of it, may result in severe civil and criminal
penalties, and will be prosecuted to the maximum extent possible under the low. Purchasers are
permitted to reproduce ten (10) copies of this document when completed. To report copyright
violations of AIA Contract Documents, e-mail The American Institute of Architects’ legal counsel,
copyright@aia.org.

 

	 	 	 

	

	 	Document G703 TM — 1992

Continuation Sheet

GENERAL INFORMATION

Purpose
and Related Documents, AIA Document G702, Application and Certificate for Payment, is to be
used in conjunction with AIA Document G703, Continuation Sheet. These documents are designed for
use on Projects where the Contractor has a direct Agreement with the Owner. Procedures for Their
use are covered in AIA Document A201, General Conditions of the Contract for Construction.

Use of Current Documents. Prior to using any AIA Contract Document, users should consult
www.aia.org or a local AIA component to verify the most recent edition.

Reproductions.
This document is a copyrighted work and may not be reproduced or excerpted from
without the express written permission of the AIA. There is no implied permission to reproduce this
document, nor does membership in The American Institute of Architects confer any further rights to
reproduce this document. The AIA hereby grants the purchaser a limited license to reproduce a
maximum of ten copies of a completed G703, but only for use in connection with a particular
project. The AIA will not permit reproduction outside of the limited license for reproduction
granted above, except upon written request and receipt of written permission from the AIA. Rights
to reproduce the document may vary for users of AIA software. Licensed AIA software users should
consult the End User License Agreement (EULA). To report copyright violations of AIA Contract
Documents, e-mail The American Institute of Architects’ legal
counsel,
copyright@aia.org.

COMPLETING THE G703 FORM

Heading: This information should be completed in a manner consistent with similar information on
AIA Document G702, Application and Certificate for Payment.

Columns A, B & C: These columns should
be completed by identifying the various portions of the Project and their scheduled values
consistent with the schedule of values submitted to the Architect at the commencement of the
Project or as subsequently adjusted. The breakdown may be by sections of the Work or by
Subcontractors and should remain consistent throughout the Project. Multiple pages should be used
when required.

Column C should be subtotaled at the bottom when more than one page is used and totaled on the last
page. Initially, this total should equal the original Contract Sum. The total of column C may be
adjusted by Change Orders during the Project.

Column D: Enter in this column the amount of completed Work covered by the previous application
(columns D & E from (The previous application). Values from column F (Materials presently Stored)
from the previous application should not be entered in this column.

Column E: Enter here the value of Work completed of the time of this application, including the
value of materials incorporated in the project that were listed on the previous application under
Materials Presently Stored (column F).

Column F:
Enter here the value of Materials Presently Stored for which payment is sought. The total
of the column must be recalculated at the end of each pay period. This value covers both materials
newly stored for which payment is sought and materials previously stored which are not yet
incorporated into the Project. Mere payment by the Owner for stored materials does not result in a
deduction from this column. Only as materials are incorporated into the Project is their value
deducted from this column and incorporated into column E (Work Completed—This Period.)

Column G: Enter here the total of columns D, E and F. Calculate the
percentage completed by dividing column G by column C.

Column H: Enter here
the difference between column C (Scheduled Value) and column G (Total
Completed and Stored to Date).

Column I: This column is normally used only for contracts where variable retainage is permitted on
a line-item basis. It need not be completed on projects where a constant retainage is withheld from
the overall contract amount.

Change Orders: Although Change Orders could be Incorporated by changing the schedule of values each
time a Change Order is added to the Project, this is not normally done. Usually, Change
Orders are listed separately, either on their own G703 form or at the end of the basic schedule.
The amount of the original contract adjusted by Change Orders is to be entered in the appropriate
location on the G702 form.

Construction Change Directives: Amounts not in dispute that have been Included in Construction
Change Directives should be incorporated into one or more Change Orders. Amounts remaining in
dispute should be dealt with according to Section 7.3 in A201.

The following is an example of a Continuation Sheet for work in progress. Please note that dollar
amounts shown below are for illustrative purposes only, and are not intended to relied actual
construction costs.

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	A	 	B	 	C	 	D	 	E	 	F	 	G	 	H	 	I
	 	 	 	 	 	 	WORK COMPLETED	 	MATERIALS PRESENTLY	 	TOTAL COMPLETED AND	 	 	 	 	 	 
	 	 	 	 	 	 	FROM 	 	 	 	STORED 	 	STORED 	 	 	 	BALANCE 	 	RETAINAGE 
	 	 	 	 	SCHEDULED	 	PREVIOUS	 	 	 	NOT IN	 	TO DATE	 	%	 	TO FINISH	 	(IF
	ITEM NO.	 	DESCRIPTION OF WORK	 	VALUE	 	APPLICATION (D+E)	 	THIS PERIOD	 	D OR E	 	(D+E+F)	 	(G÷C)	 	(C-G)	 	VARIABLE RATE)
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	1	 	MOBILIZATION
	 	5,000	 	5,000	 	0	 	0	 	5,000	 	100	 	0	 	 	 	 
	2	 	STUMP REMOVAL
	 	5,000	 	5,000	 	0	 	0	 	5,000	 	100	 	0	 	 	 	 
	3	 	EARTH WORK
	 	15,000	 	10,000	 	5,000	 	0	 	15,000	 	100	 	0	 	 	 	 
	4	 	LOWER RETAINING WALL
	 	10,000	 	0	 	5,000	 	0	 	5,000	 	50	 	5,000	 	 	 	 
	5	 	CURBS &
MISC. CONC
	 	5,000	 	0	 	0	 	0	 	0	 	0	 	5,000	 	 	 	 
	6	 	PAVING UPPER DRIVE
	 	20,000	 	0	 	0	 	0	 	0	 	0	 	20,000	 	 	 	 
	7	 	PAVING, LOWER DRIVE
	 	20,000	 	0	 	0	 	0	 	0	 	0	 	20,000	 	 	 	 
	8	 	PAVERS
	 	20,000	 	0	 	0	 	10,000	 	10,000	 	50	 	10,000	 	 	 	 
	9	 	BRICK WORK
	 	5,000	 	0	 	0	 	0	 	0	 	0	 	5,000	 	 	 	 
	10	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	11	 	 
	 	105,000	 	20,000	 	10,000	 	10,000	 	40,000	 	 	 	65,000	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

AIA Document G703TM-1992. Copyright © 1963, 1965, 1966, 1967, 1970, 1978, 1983
and 1992 by The American Institute of Architects. All rights
reserved. WARNING: This AIA ® Document
is protected by U.S. Copyright Law and International Treaties. Unauthorized reproduction or
distribution of this AIA ® Document, or any portion of it, may result in severe civil and
criminal penalties, and will be prosecuted to the maximum extent possible under the law. Purchasers
are permitted to reproduce ten (10) copies of this document when completed. To report copyright
violations of AIA Contract Documents, e-mail The American Institute of Architects legal
counsel,copyright@aia.org.

 

EXHIBIT “B-4”

Contractor Certification

     The undersigned certifies that he/she is authorized to execute this “Contractor
Certification on behalf of the Contractor. For purposes of this certification, (a) the
term “Plans and Specifications” shall mean the plans, specifications or other documents
which define the scope of work to construct or renovate improvements on the subject
property, and (b) the term “Work” shall mean improvements to be performed on the
subject property in compliance with the Plans and Specifications. The Contractor
certifies, represents and warrants as follows:

     1. The sum necessary to complete all remaining Work in accordance with the Plans
and Specifications is $                                        .

     2. There have been no material changes in said Plans and Specifications; except as
otherwise disclosed on an attachment hereto or as previously approved by Lender.

     3.                     % of the total Work has been completed.

     4. There have been no material changes in the “Approved Budget”; except as
previously approved by Lender and the remaining proceeds of the Approved Budget are
sufficient to finally and fully complete and pay for all Work.

     5. If requested by Lender or Borrower, attached are “Bills Paid Affidavits” and/or
true and correct copies of the invoices for the cost of labor and materials for which
this “Draw Request” is being submitted;

     6. The attached Application and Certificate For Payment (AIA Form G702) or other
form approved by Lender (“Application for Payment”) is true and correct and the
Application for Payment contains a clear disclosure of the funds disbursed by Lender
since the previous Draw Request submitted to Lender.

     7. All sums previously advanced by Lender and advanced pursuant hereto, or paid to
Contractor have been and will be used by Contractor solely for the purpose of paying
the obligations owing by Contractor as set forth in this Draw Request for Contractor,
and for no other purpose.

     8. Contractor has paid, or will pay contemporaneously with the advance made by
Lender pursuant to this Draw Request, for all labor or materials furnished in
connection with the Work.

     9. All Work performed to the date of this Draw Request has been performed in a
good and workmanlike manner in substantial conformance with the Plans and
Specifications.

     10. All Work has been performed in substantial compliance with all applicable
ordinances, statutes, regulations and subdivision requirements or restrictions that
affect the subject property.

     11. There are no mechanic’s liens, liens affidavits or encumbrances against the
subject property or improvements thereon, and Contractor has not received any notice or
communication

CONTRACTOR CERTIFICATION

 

 

that any subcontractor, materialman or laborer has not been paid current for all
labor or materials performed or furnished in connection with the Work.

     12. To the best of the Contractor’s knowledge, no default exists under the
Construction Contract, and no event has occurred that with the giving of notice would
otherwise constitute an event of default under the Construction Contract.

	 	 	 	 	 	 	 	 	 

	 	 	CONTRACTOR:
	 
	 	 	 	 	 	 	 	 
	 	 	CAMPUS CREST CONSTRUCTION, LLC, a North
	 	 	Carolina limited liability company
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	Campus Crest Group, LLC, a North Carolina
	 	 	 	 	limited liability company, Manager
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	Madeira Group, LLC, a North Carolina limited
	 	 	 	 	 	 	liability company, Manager
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	Michael S. Hartnett, Manager

CONTRACTOR CERTIFICATION

 

 

EXHIBIT “C-1”

INITIAL APPROVED BUDGET

 

 

	 	 	 

	

	 	DRAFT

HUNTSVILLE, TX 

Sources
And Uses Detail

February 16, 2009

Project
Unit Mix

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Unit Count	 	Type	 	 	Beds	 	 	Sq.Ft.	 	 	Total SF	 
	 
	72
	 	2BRs	 	 	144	 	 	 	839	 	 	 	60,408	 
	120
	 	3BRs	 	 	360	 	 	 	1,180	 	 	 	141,600	 
	 
	192
	 	 	 	 	 	 	504	 	 	 	 	 	 	 	202,008	 
	 
	Total Buildings
	 	 	11	 	 	 	 	 	 	 	8,087	 	 	 	210,095	 

	 	 	 	 	 	 	 	 	 
	 	 	Total	 	 	Dollars	 
	SOURCES:	 	Dollars	 	 	Per Unit	 
	Equity
	 	 	7,190,872	 	 	 	37,452	 
	Debt
	 	 	13,354,477	 	 	 	69,555	 
	 
	 	 	 	 	 	 
	 	 	 
	 	 	 	 
	Total
	 	 	20,545,349	 	 	 	107,007	 
	 
	 	 	 	 	 	 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Unit	 	Cost	 	 	Total	 	 	Dollars	 
	 	 	USES:	 	Units	 	 	of Meas.	 	Per Unit	 	 	Dollars	 	 	Per unit	 
	DEVELOPMENT	 	Land Cost
	 	 	19,3	 	 	acres	 	 	155,440	 	 	 	3,000,000	 	 	 	 	 
	 	 	Land Closing Costs
	 	 	1	 	 	 	 	 	158,000	 	 	 	158,000	 	 	 	 	 
	 	 	RDP Compensation
	 	 	1	 	 	ea	 	 	85,000	 	 	 	85,000	 	 	 	 	 
	 	 	Survey
	 	 	1	 	 	ea	 	 	33,500	 	 	 	33,500	 	 	 	 	 
	 	 	Real Estate Taxes/insurance
	 	 	1	 	 	ea	 	 	15,000	 	 	 	15,000	 	 	 	 	 
	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Total Land Costs
	 	 	 	 	 	 	 	 	 	 	 	 	3,291,500	 	 	 	 	 
	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Architect
	 	 	1	 	 	ea	 	 	80,000	 	 	 	80,000	 	 	 	 	 
	 	 	Civil Engineer
	 	 	1	 	 	ea	 	 	75,000	 	 	 	75,000	 	 	 	 	 
	 	 	Landscape Architect
	 	 	1	 	 	ea	 	 	20,000	 	 	 	20,000	 	 	 	 	 
	 	 	Geotechnical Report
	 	 	1	 	 	ea	 	 	12,000	 	 	 	12,000	 	 	 	 	 
	 	 	Environmental
	 	 	1	 	 	ea	 	 	7,500	 	 	 	7,500	 	 	 	 	 
	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Total Design/Engineering Costs
	 	 	 	 	 	 	 	 	 	 	 	 	194,500	 	 	 	 	 
	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Loan Origination Fees
	 	 	1	 	 	ea	 	 	133,545	 	 	 	133,545	 	 	 	 	 
	 	 	Advisory Fees
	 	 	1	 	 	ea	 	 	15,000	 	 	 	15,000	 	 	 	 	 
	 	 	Appraisal Fees
	 	 	1	 	 	ea	 	 	7,500	 	 	 	7,500	 	 	 	 	 
	 	 	Market Study Fees
	 	 	1	 	 	ea	 	 	15,000	 	 	 	15,000	 	 	 	 	 
	 	 	Construction Interest
	 	 	1	 	 	ea	 	 	571,153	 	 	 	571,153	 	 	 	 	 
	 	 	Land Interest Accrual
	 	 	1	 	 	ls	 	 	204,000	 	 	 	204,000	 	 	 	 	 
	 	 	Loan Closing Costs
	 	 	1	 	 	ea	 	 	35,000	 	 	 	35,000	 	 	 	 	 
	 	 	Lender Inspections
	 	 	10	 	 	Months	 	 	800	 	 	 	8,000	 	 	 	 	 
	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Total Financing Costs
	 	 	 	 	 	 	 	 	 	 	 	 	989,198	 	 	 	 	 
	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Development Fee
	 	 	1	 	 	ea	 	 	637,049	 	 	 	637,049	 	 	 	 	 
	 	 	Legal Fees-Development
	 	 	1	 	 	ea	 	 	25,000	 	 	 	25,000	 	 	 	 	 
	 	 	Impact Fees
	 	 	192	 	 	unit	 	 	964	 	 	 	185,000	 	 	 	 	 
	 	 	Acccounting
Fees & Comp. Dep’n
	 	 	1	 	 	ea	 	 	8,000	 	 	 	8,000	 	 	 	 	 
	 	 	Municipailty Fees
	 	 	1	 	 	ea	 	 	27,000	 	 	 	27,000	 	 	 	 	 
	 	 	Builders Risk Insurance
	 	 	10	 	 	Months	 	 	3,000	 	 	 	30,000	 	 	 	 	 
	 	 	Travel
	 	 	10	 	 	Months	 	 	5,000	 	 	 	50,000	 	 	 	 	 
	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Total Development Fees, Permits & Costs
	 	 	 	 	 	 	 	 	 	 	 	 	962,049	 	 	 	 	 
	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Development Contingency
	 	 	1	 	 	ls	 	 	5,000	 	 	 	5,000	 	 	 	 	 

 

	 	 	 

	

	 	DRAFT
	 	HUNTSVILLE, TX
	 

	 	Sources and Uses Detail
	 

	 	February 16, 2009
	 
	 

	 	Project Unit Mix

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Unit Count	 	Type	 	 	Beds	 	 	Sq. Ft.	 	 	Total SF	 
	 
	72
	 	2BRs	 	 	144	 	 	 	839	 	 	 	60,408	 
	120
	 	3BRs	 	 	360	 	 	 	1,180	 	 	 	141,600	 
	 
	192
	 	 	 	 	 	 	504	 	 	 	 	 	 	 	202,008	 
	 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

	INITIAL OPS BUDGET	 	Corporate Marketing/Support
	 	 	1	 	 	ea	 	 	85,000	 	 	 	85,000	 
	 	 	 	 	Site Operations
	 	 	1	 	 	ea	 	 	112,500	 	 	 	112,500	 
	 	 	 	 	Site Marketing
	 	 	1	 	 	ea	 	 	112,500	 	 	 	112,500	 
	 	 	 	 	Model/Trailer
	 	 	1	 	 	ea	 	 	50,000	 	 	 	50,000	 
	 	 	 	 	Final Cleaning
	 	 	1	 	 	ls	 	 	21,000	 	 	 	21,000	 
	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Total Marketing and Pre-opening	 	 	 	 	 	 	 	 	 	 	 	 	 	 	381,000	 
	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	CONSTRUCTION	 	Payroll/Overhead
	 	 	11	 	 	Months	 	 	23,000	 	 	 	253,000	 
	 	 	 	 	Construction Management Fee
	 	 	1	 	 	ea	 	 	255,000	 	 	 	255,000	 
	 	 	 	 	Bond Premiums
	 	 	1	 	 	ea	 	 	40,000	 	 	 	40,000	 
	 	 	 	 	Permils/Licensing
	 	 	11	 	 	Buildings	 	 	7,273	 	 	 	80,000	 
	 	 	 	 	Surveying/Engineer
	 	 	1	 	 	ea	 	 	30,000	 	 	 	30,000	 
	 	 	 	 	Plans/Blueprints
	 	 	1	 	 	ea	 	 	16,000	 	 	 	16,000	 
	 	 	 	 	Testing/Geotech
	 	 	1	 	 	ea	 	 	30,000	 	 	 	30,000	 
	 	 	 	 	Travel
	 	 	10	 	 	Months	 	 	6,000	 	 	 	60,000	 
	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Total Construction Fees & Cost	 	 	 	 	 	 	 	 	 	 	 	 	 	 	764,000	 
	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	Payroll + Load-Corporate Overhead
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	83,000	 
	 	 	 	 	Construction Payroll + Load
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	317,000	 
	 	 	 	 	G&A Allocation-Corporate Overhead
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	39,000	 
	 	 	 	 	G&A Construction Direct
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	60,000	 
	 	 	 	 	Travel-CCC Management & Oversight
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	50,000	 
	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Reimbursable Overhead Costs (Corp. & Construction)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	549,000	 
	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	Small Tools
	 	 	10	 	 	Months	 	 	850	 	 	 	8,500	 
	 	 	 	 	Temp. Water-Consumption
	 	 	11	 	 	Months	 	 	730	 	 	 	8,030	 
	 	 	 	 	Temp. Power-Consumption
	 	 	11	 	 	Months	 	 	2,727	 	 	 	30,000	 
	 	 	 	 	Temp. Toilets
	 	 	11	 	 	Months	 	 	550	 	 	 	6,050	 
	 	 	 	 	Temp. Telephones
	 	 	11	 	 	Months	 	 	545	 	 	 	6,000	 
	 	 	 	 	Safety
	 	 	11	 	 	Months	 	 	400	 	 	 	4,400	 
	 	 	 	 	Field Office
	 	 	11	 	 	Months	 	 	1,110	 	 	 	12,210	 
	 	 	 	 	FieldOffice Supplies
	 	 	11	 	 	Months	 	 	300	 	 	 	3,300	 
	 	 	 	 	Equipment Rental
	 	 	11	 	 	Months	 	 	10,000	 	 	 	110,000	 
	 	 	 	 	Gas & Oil
	 	 	11	 	 	Months	 	 	818	 	 	 	9,000	 
	 	 	 	 	General Labor
	 	 	11	 	 	Months	 	 	8,091	 	 	 	89,000	 
	 	 	 	 	Waste Removal
	 	 	11	 	 	Months	 	 	4,000	 	 	 	44,000	 
	 	 	 	 	Postage
	 	 	11	 	 	Months	 	 	1,050	 	 	 	12,000	 
	 	 	 	 	Final Cleaning
	 	 	1	 	 	ea	 	 	21,000	 	 	 	21,000	 
	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Total Job-General Conditions Cost	 	 	 	 	 	 	 	 	 	 	 	 	 	 	363,490	 
	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	SITEWORK	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	Sediment & Erosion
	 	 	1	 	 	ls	 	 	20,000	 	 	 	20,000	 
	 	 	 	 	Construction Entrances
	 	 	1	 	 	ls	 	 	5,000	 	 	 	5,000	 
	 	 	 	 	Temp Access Roadways (Stone)
	 	 	1	 	 	ls	 	 	20,000	 	 	 	20,000	 
	 	 	 	 	Dewatering
	 	 	1	 	 	ls	 	 	5,000	 	 	 	5,000	 
	 	 	 	 	Temp. Water-Installation
	 	 	1	 	 	ls	 	 	1,000	 	 	 	1,000	 
	 	 	 	 	Temp Facility Ground Lease
	 	 	0	 	 	ls	 	 	5,000	 	 	 	—	 
	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Temporary Facilities	 	 	 	 	 	 	 	 	 	 	 	 	 	 	51,000	 
	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	Clear & Grub
	 	 	1	 	 	ls	 	 	30,000	 	 	 	30,000	 
	 	 	 	 	Grading
	 	 	12.6	 	 	acres	 	 	32,000	 	 	 	403,200	 
	 	 	 	 	Cut & Fills
	 	 	12.6	 	 	acres	 	 	—	 	 	 	—	 
	 	 	 	 	Retaining Walls
	 	 	0	 	 	ls	 	 	—	 	 	 	—	 
	 	 	 	 	Street & Trailer Pad Demolition
	 	 	11	 	 	acres	 	 	5,000	 	 	 	55,000	 
	 	 	 	 	Trailer Removal
	 	 	20	 	 	ea	 	 	1,000	 	 	 	20,000	 
	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Grading, Walls, Fill, Cut Total	 	 	 	 	 	 	 	 	 	 	 	 	 	 	508,200	 

 

	 	 	 

	

	 	DRAFT
	 	HUNTSVILLE, TX
	 

	 	Sources and Uses Detail
	 

	 	February 16, 2009
	 
	Project Unit Mix	 

	 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Unit Count	 	Type	 	 	Beds	 	 	Sq. Ft.	 	 	Total SF	 
	 
	72
	 	2BRs	 	 	144	 	 	 	839	 	 	 	60,408	 
	120
	 	3BRs	 	 	360	 	 	 	1,180	 	 	 	141,600	 
	 
	192
	 	 	 	 	 	 	504	 	 	 	 	 	 	 	202,008	 
	 

	 	 	 	 	 	 	 	 	 	 	 	 	 
	Water Service
	 	 	1	ls	 	 	 	200,000	 	 	 	200,000	 
	Sanitatry Sewer Services
	 	 	1	ls	 	 	 	200,000	 	 	 	200,000	 
	Storm Water
	 	 	1	ls	 	 	 	200,000	 	 	 	200,000	 
	Utilities — Wet
	 	 	 	 	 	 	 	 	 	 	 	600,000	 
	 
	Video
	 	 	1	ls	 	 	 	149,000	 	 	 	149,000	 
	Internet
	 	 	1	ls	 	 	 	100,000	 	 	 	100,000	 
	Landline Phone
	 	 	1	ls	 	 	 	20,000	 	 	 	20,000	 
	Utilities — Structured Wiring
	 	 	 	 	 	 	 	 	 	 	 	269,000	 
	 
	Water Service
	 	 	 	lf	 	 	 	—	 	 	 	—
	Sewer Service
	 	 	 	lf	 	 	 	—	 	 	 	—
	Entrance Drive to
Traiter Park
	 	 	1	ls	 	 	 	60,000	 	 	 	60,000	 
	Off-Site Improvements
	 	 	 	 	 	 	 	 	 	 	 	60,000	 
	 
	Asphaltic
Paving, Striping & Signage
	 	 	210,000	 sf	 	 	 	2	 	 	 	455,700	 
	 
	Curb
	 	 	8000	 lf	 	 	 	9	 	 	 	75,040	 
	Sidewalks
	 	 	8000	 sf	 	 	 	3	 	 	 	24,000	 
	Site Concrete
	 	 	 	 	 	 	 	 	 	 	 	99,040	 
	 
	Landscape
	 	 	1	ls	 	 	 	125,000	 	 	 	125,000	 
	Irrigation
	 	 	1	ls	 	 	 	25,000	 	 	 	25,000	 
	Fencing — Chain Link
	 	 	15000	 sf	 	 	 	4	 	 	 	60,000	 
	Fencing — Decorative
	 	 	5000	 sf	 	 	 	7	 	 	 	35,000	 
	Entrance Gates
	 	 	1	ea	 	 	 	15,000	 	 	 	15,000	 
	Card Reader Access
	 	 	1	ls	 	 	 	25,000	 	 	 	25,000	 
	Landscape, Fencing, Irrigation
	 	 	 	 	 	 	 	 	 	 	 	285,000	 
	 
	Monument Sign Base
	 	 	1	ls	 	 	 	12,000	 	 	 	12,000	 
	B-Ball Court
	 	 	1	ls	 	 	 	15,000	 	 	 	15,000	 
	V-Ball Court
	 	 	1	ls	 	 	 	15,000	 	 	 	15,000	 
	Barbeque Grill w/Iron
	 	 	1	ls	 	 	 	9,500	 	 	 	9,500	 
	Fire Pil Area
	 	 	1	ls	 	 	 	5,500	 	 	 	5,500	 
	Pool
	 	 	1	ls	 	 	 	90,000	 	 	 	90,000	 
	Skimmer
	 	 	1	ls	 	 	 	18,000	 	 	 	18,000	 
	Kool Deck
	 	 	1	ls	 	 	 	20,000	 	 	 	20,000	 
	Blue Bottom
	 	 	1	ls	 	 	 	10,000	 	 	 	10,000	 
	Large Size
	 	 		ls	 	 	 	 	 	 	 	—	 
	Compactor — SOG
	 	 	1	ls	 	 	 	3,500	 	 	 	3,500	 
	Compactor — Enclosure
	 	 	1	ls	 	 	 	12,000	 	 	 	12,000	 
	Compactor — Gate
	 	 	1	ls	 	 	 	3,500	 	 	 	3,500	 
	Site Amenities
	 	 	 	 	 	 	 	 	 	 	 	214,000	 
	 
	Site Contingency
	 	 	1	ls	 	 	 	243,500	 	 	 	243,500	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Total Sitework Cost
	 	 	 	 	 	 	 	 	 	 	 	2,785,440	 

 

	 	 	 

	

	 	 
	 	DRAFT

HUNTSVILLE, TX
	 

	 	Sources and Uses Detail
	 

	 	February 16, 2009
	 
	 

	 	Project Unit Mix

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Unit Count	 	Type	 	 	Beds	 	 	Sq. Ft.	 	 	Total SF	 
	 
	72
	 	2BRs	 	 	144	 	 	 	839	 	 	 	60,408	 
	120
	 	3BRs	 	 	360	 	 	 	1,180	 	 	 	141,600	 
	 
	192
	 	 	 	 	 	 	504	 	 	 	 	 	 	 	202,008	 
	 

VERTICAL IMPROVEMENTS

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

	Concrete
	 	 	 	 	 	 	 	 	 	 	600,000	 	 	 	 	 
	Masonry
	 	 	 	 	 	 	 	 	 	 	380,000	 	 	 	 	 
	Metals
	 	 	 	 	 	 	 	 	 	 	145,000	 	 	 	 	 
	Wood & Plastics
	 	 	 	 	 	 	 	 	 	 	1,850,000	 	 	 	 	 
	Thermal/Moisture Protection
	 	 	 	 	 	 	 	 	 	 	840,000	 	 	 	 	 
	Doors & Windows
	 	 	 	 	 	 	 	 	 	 	525,500	 	 	 	 	 
	Finishes
	 	 	 	 	 	 	 	 	 	 	1,072,000	 	 	 	 	 
	Specialities
	 	 	 	 	 	 	 	 	 	 	103,500	 	 	 	 	 
	Mechanical
	 	 	 	 	 	 	 	 	 	 	1,785,000	 	 	 	 	 
	Electrical
	 	 	 	 	 	 	 	 	 	 	1,090,500	 	 	 	 	 
	Apartment Appliances
	192 units	 	 	1,774	 	 	 	340,625	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Residence Buildings
	 	 	 	 	 	 	 	 	 	 	8,532,125	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Clubhouse
	 	 	 	 	 	 	 	 	 	 	525,000	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Pavillion
	1 ea	 	 	25,000	 	 	 	25,000	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Contingency
	1 ea	 	 	243,000	 	 	 	243,000	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Total Vertical Improvements
	 	 	 	 	 	 	 	 	 	 	9,325,125	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	FF&E
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Apartment Furniture
	 	 	 	 	 	 	 	 	 	 	291,111	 	 	 	 	 
	Apartment Upholstry
	 	 	 	 	 	 	 	 	 	 	107,270	 	 	 	 	 
	Apartment Mattress & Frames
	 	 	 	 	 	 	 	 	 	 	93,240	 	 	 	 	 
	Apartment
FF&E Shipping,
Storage, Installation
	 	 	 	 	 	 	 	 	 	 	72,000	 	 	 	 	 
	Clubhouse
Furniture
	 	 	 	 	 	 	 	 	 	 	43,870	 	 	 	 	 
	Clubhouse Amenities
	 	 	 	 	 	 	 	 	 	 	46,600	 	 	 	 	 
	Clubhouse Fixtures
	 	 	 	 	 	 	 	 	 	 	43,200	 	 	 	 	 
	Clubhouse Equipment
	 	 	 	 	 	 	 	 	 	 	237,755	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Total FF&E
	 	 	 	 	 	 	 	 	 	 	935,047	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	Per Unit
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Total Project Costs
	 	 	 	 	 	 	 	 	 	 	20,545,349	 	 	 	107,007	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

 

Exhibit C-2

Budget Revision Request

	 	 	 	 	 

	Loan Amount:
	 	 	 	 
	Loan Number:

	 	 

	 	 
	Borrower:

	 	 

	 	 
	Project Name:

	 	 

	 	 
	Budget Revision Number:

	 	 

      1
 

	 	  
	Revision Request Date:
	 	 	 	 
	 

	 	 

	 	 

Dear Lender:

Pursuant to the terms of the loan agreement (the “Loan Agreement”) for the above referenced Loan,
Borrower requests modifications to the Approved Budget as follows:

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Initial	 	 	Previously	 	 	 	 	 	 	Budget with	 
	 	 	Approved	 	 	Approved	 	 	Requested	 	 	Requested	 
	 	 	Budget	 	 	Revisions	 	 	Revisions	 	 	Revisions	 
	 	 	 
	Sources of Funds:
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Loan Proceeds:
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Construction Loan
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	 	 	 
	Total Loan Proceeds
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Equity Proceeds:
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Borrower Cash Equity
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	 	 	 
	Total Equity Proceeds
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Total Sources of Funds:
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Uses of Funds:
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Land:
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Land Acquisition
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	 	 	 
	Total Land
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Development Allocation (See Note):
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Development Contracts
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	 	 	 
	Total
Development  Allocation
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Construction Allocation (See Note):
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	
Construction Contracts
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	 	 	 
	Total Construction Allocation
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Non Construction Allocation:
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Engineer
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	Advertising
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	Property Taxes
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	Insurance
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	Closing Costs
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	Interest Reserve
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	 	 	 
	Total Non Construction Allocation
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Total Uses of Funds:
	 	$	—	 	 	$	—	 	 	$	—	 	 	$	—	 

 

 

Exhibit “C-3”

Budget Revision Certification

     The undersigned certifies that he/she is authorized to execute this Budget
Revision Request and Budget Revision Certification on behalf of the Borrower. The
Borrower certifies, represents and warrants as follows:

     1. To the best of Borrower’s knowledge, the Borrower has performed and complied with
all agreements, terms and conditions contained in the Loan Agreement and the other
documents executed in connection therewith (the “Other Loan Documents”) required to be
performed or complied with prior to or at the time of delivery hereof.

     2. The representations and warranties of the Borrower contained in the Loan
Agreement and otherwise made in writing by or on behalf of the Borrower pursuant to the
Loan Agreement were true and correct in all material respects when
made, are
hereby repeated as of the time of delivery hereof, and are true and correct in all
material respects as of the time of delivery of this Draw Request and Draw Certification. In the event any such representations have changed, the manner in which such
representations have changed is set forth herein or in an attachment hereto.

     3. Since the date of execution of the Loan Agreement, no material change has
occurred, either in any instance or in the aggregate in the condition, financial or
otherwise, of the Borrower, or its properties, which would have a material adverse
effect on the Borrower. Furthermore, the Borrower has not incurred any material
liabilities since the date of execution of the Loan Agreement, except as disclosed in
writing to Lender or as reflected in Borrower’s financial statements which have been
previously delivered to Lender, but in any event, Borrower is in full compliance with
the covenants contained in the Loan Agreement and the Other Loan Documents.

     4. To the best of the Borrower’s knowledge, there are no mechanic’s liens, liens
affidavits or encumbrances against the subject property or improvements thereon, and
Borrower has not received any notice or communication that any subcontractor,
materialman or laborer has not been paid current for all labor or materials
performed or furnished in connection with the “Work” to be performed on the subject
property.

     5. There have been no material changes in approved “Plans and Specifications”;
except as otherwise disclosed on an attachment hereto or as previously approved by
Lender.

     6. There
are no “Change Orders” to any “Construction
Contracts”; except as
otherwise disclosed on an attachment hereto or as previously approved by Lender.

     7. The “Approved Budget” when taking into consideration the Budget Revision
Request presents a full and complete representation of all costs, expenses and fees
which Borrower expects to pay or anticipates becoming obligated to pay to complete the
Work in compliance with the approved Plans and Specifications.

Budget Revision Certification 

 

 

EXHIBIT “D-2”

Loan No. 99-10-71154

ASSIGNMENT OF CONSTRUCTION CONTRACT

	 	 	 

	THE STATE OF TEXAS

	 	§
	 

	 	§
	COUNTY OF WALKER

	 	§

     For and in consideration of the sum of TEN AND NO/100 DOLLARS ($10.00) and other
good and valuable consideration in hand paid, the receipt and sufficiency of which
are hereby acknowledged, CAMPUS CREST AT HUNTSVILLE, LP, a Delaware limited partnership
(hereinafter called “Borrower”), does hereby TRANSFER, ASSIGN AND DELIVER unto AMEGY MORTGAGE
COMPANY, L.L.C. d/b/a Q10 Amegy Mortgage Capital, a Texas limited liability company
(hereinafter called “Lender”), all of the rights, interests, benefits, warranties, permits,
plans and drawings of the Borrower under that certain             
                   
                   
                   
           
(the “Contract”) dated                  
                      
                     , by and between
CAMPUS CREST CONSTRUCTION, LLC, a North Carolina limited liability company, as Contractor
(“Contractor”) and the Borrower, as owner (the “Owner”), providing for the construction of
certain improvements (“Improvements”) upon the property described on Exhibit “A” attached
hereto and made a part hereof for all purposes (the “Property”); however, the Lender does not
hereby assume any of the Borrower’s liabilities, duties or obligations under Contract.

     This Assignment of Construction Contract (“Assignment”) constitutes a part of the security
for the payment of that certain Promissory Note dated effective June ___, 2009 (the “Note”), in
the original principal sum of $13,355,000.00 executed by Borrower, payable to the order of
Lender the payment of which is secured by that certain Deed of Trust and Security Agreement of
even date with the Note (the “Deed of Trust”), pursuant to the terms of that certain
Construction Loan Agreement of even date with the Note (the “Loan Agreement”), by
and between Borrower and Lender, which Note, Deed of Trust, Loan Agreement, and various other
documents relating thereto are hereinafter referred to as the “Loan Documents”. Lender shall
not exercise any rights hereunder unless an Event of Default, as defined in the Loan Documents,
shall have occurred and be continuing pursuant to the terms thereof in connection with the
construction of the Improvements on the Property.

     If and when the indebtedness evidenced by the Note shall have been fully paid and
satisfied and the obligations of Borrower under the Loan Documents shall have been performed
and satisfied without the necessity of Lender exercising its rights hereunder, this
Assignment shall terminate and thereafter be of no further effect.

     Contractor executes this Assignment for the purpose of evidencing Contractor’s consent to
this Assignment and Contractor’s knowledge of the contents hereof; further, to evidence
Contractor’s agreement to continue under the terms of the Contract at Lender’s request, if and
only if Contractor has been paid for all work performed through the date Lender shall have
made such request and Lender agrees to pay for all work performed in accordance with the
Contract thereafter.

     Contractor further agrees that Contractor shall furnish Lender written notice of default
by Borrower of any of Borrower’s obligations under the Contract with Borrower and
give Lender an opportunity to cure said default within a reasonable period of time, but never
less than ten (10) business days prior to terminating the Contract, or taking any other action
in relation thereto because of said default

     Contractor further agrees that Contractor shall not perform work pursuant to any Change
Order, as such term is defined in the Contract, which will result in an increase of
greater than $50,000 for any single Change Order or $250,000 for all Change Orders in the
aggregate, unless Contractor shall have received Lender’s specific written approval of such
Change Order.

     In the event Contractor fails to secure such written approval, Contractor’s
Contract with Borrower shall, for

 

 

     8. The unadvanced portion of all “Sources of Funds” as designated in the
Approved Budget, when taking into consideration the Budget Revision Request, provides
sufficient funding to complete the Work, in compliance with the approved Plans and
Specifications.

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

	 	 	BORROWER:
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	CAMPUS CREST AT HUNTSVILLE, LP, a Delaware limited partnership
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	HSRE-CC Huntsville GP, LLC, a Delaware limited liability company, its General Partner
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	HSRE-Campus Crest I, LLC,
a Delaware limited liability company, its sole member
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	By:	 	Campus Crest Ventures III, LLC, a Delaware limited liability company, a member
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	By:  	Campus Crest Properties, LLC, a North Carolina
limited liability company, its Manager
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	By:  	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	  

Michael S. Hartnett, Manager
	 	 

Budget Revision Certification 

 

 

the purpose of Contractor’s obligation under this Assignment to continue performance
thereunder for Lender’s benefit, be deemed not to have been modified by such Change Order.

     As further inducement to Lender to make the Loan to Borrower, Contractor has
agreed and does hereby covenant and agree with and for the benefit of Lender, its successors
and assigns, that any and all liens, rights, claims, debts, demands, charges, causes of action
and interest (whether choate or inchoate and including, without limitation, all
mechanic’s and materialmen’s liens under the Constitution and statutes of the State of Texas)
owned or claimed on the improvements, fixtures or furnishings now or
hereafter constructed, placed or situated thereon, are now and shall be in all respects
subordinate and inferior to the liens and security interests created for the benefit of
Lender, its successors and assigns, under and by virtue of the Deed of Trust (and any and
all renewals, rearrangements and extensions thereof).

     This Assignment may be executed in multiple counterparts, and each
counterpart hereof executed by any party shall be deemed an original and shall as to such
party constitute one and the same instrument with all other counterparts hereof executed,
regardless of whether the same or any other counterpart hereof is executed by any other party
or by a person intended to be or who becomes a party hereunder.

     This Assignment shall be governed by the law of the jurisdiction in which the real
property encumbered by the Security Instrument is located, without giving effect to its
conflict of laws rules.

     IN
WITNESS WHEREOF, this Assignment is executed to be effective as of the ___ day
of June, 2009.

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

	 	 	BORROWER:	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	CAMPUS CREST AT HUNTSVILLE, LP, a Delaware limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	HSRE-CC Huntsville GP, LLC, a Delaware limited liability company, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	HSRE-Campus Crest I, LLC, a Delaware limited liability company,
its sole member	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	By:	 	Campus Crest Ventures III, LLC, a Delaware limited liability company,
a member	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	By:  	Campus Crest Properties, LLC, a North 

Carolina limited liability company, its Manager	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	By:  	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 

Michael S. Hartnett, Manager
	 	 

	 	 	 	 	 
	 	LENDER:

AMEGY MORTGAGE COMPANY, L.L.C. d/b/a 

Q10 Amegy Mortgage Capital, a Texas limited 

liability company

 	 
	 	By:  	 	 
	 	 	Don Hickey, Senior Vice President — Commercial 	 
	 	 	Real Estate Lending 	 

2

 

     By execution hereof, Contractor acknowledges
this Assignment of the Contract and
consents to the terms hereof.

	 	 	 	 	 
	 	CONTRACTOR:

CAMPUS CREST CONSTRUCTION, LLC, a

North Carolina limited liability company

 	 
	 	By:  	 Campus Crest Group, LLC, a North Carolina
 	 
	 	 	limited liability company, Manager 	 
	 

	 	 	 	 	 
	 	By:  	 Madeira Group, LLC, a North
 	 
	 	 	Carolina limited liability company, Manager 	 
	 

	 	 	 	 	 
	 	By:  	
 	 
	 	 	Michael S. Hartnett, Manager 	 
	 	 	 	 
	 

	 	 	 	 	 

	THE STATE OF

	 	 	 	§
	 

	 	 

	 	 
	 

	 	 	 	§
	COUNTY OF

	 	 	 	§
	 

	 	 

	 	 

     This instrument was acknowledged before me
on the                    day of
June, 2009, by Michael S. Hartnett, Manager of Campus Crest Properties, LLC, a North Carolina
limited liability company, in its capacity as Manager of Campus Crest Ventures
III, LLC, a Delaware limited liability company, in its capacity as a member of
HSRE-Campus Crest I, LLC, a Delaware limited liability company, in its
capacity as sole member of HSRE-CC Huntsville GP, LLC, a Delaware limited liability company,
in its capacity as general partner of CAMPUS CREST AT HUNTSVILLE, LP, a Delaware
limited partnership, on behalf of said limited partnership.

	 	 	 	 	 

	 	 	 
	 

	 	Notary Public, State of
	 	 
	 

	 	 
	 	 
 
	 

	 	My Commission Expires:
	 	 
	 

	 	 
	 	 
 

	 	 	 	 	 

	THE STATE OF TEXAS,

	 	 	 	§
	 

	 	 

	 	 
	 

	 	 	 	§
	COUNTY OF

	 	 	 	§
	 

	 
 	 

	 	 

     This instrument was acknowledged before me on this                    day of June, 2009, by Don
Hickey, Senior Vice President- Commercial Real Estate Lending of AMEGY MORTGAGE COMPANY,
L.L.C. d/b/n Q10 Amegy Mortgage Capital, a Texas limited liability company, on behalf of said
limited liability company.

	 	 	 	 	 

	 	 	 
	 

	 	Notary Public, State of Texas
	 	 
	 

	 	 
	 	 
 
	 

	 	My Commission Expires:
	 	 
	 

	 	 
	 	 
 

3

 

	 	 	 	 	 

	THE STATE OF

	 	 	 	§
	 

	 	 

	 	 
	 

	 	 	 	§
	COUNTY OF

	 	 	 	§
	 

	 	 

	 	 

     This
instrument was acknowledged before me on this ___ day of June, 2009, by
Michael S. Hartnett, Manager of Madeira Group, LLC, a North Carolina limited liability
company; in its capacity as Manager of Campus Crest Group, LLC, a North Carolina
limited liability company, in its capacity as Manager CAMPUS CREST CONSTRUCTION, LLC, a North
Carolina limited liability company, on behalf of said limited liability company.

	 	 	 	 	 

	 	 	 
	 

	 	Notary Public, State of
	 	 
	 

	 	 
	 	 
 
	 

	 	My Commission Expires:
	 	 
	 

	 	 
	 	 
 

Exhibit:

“A” — Property Description

4

 

EXHIBIT “D-5”

ASSIGNMENT OF RIGHTS UNDER DESIGN PROFESSIONAL’S CONTRACT

AND OF PLANS AND SPECIFICATIONS

	 	 	 

	THE STATE OF TEXAS

	 	§
	 

	 	§
	COUNTY OF WALKER

	 	§

     For and in consideration of the sum of TEN AND NO/l00 DOLLARS ($10.00) and other
good and valuable consideration in hand paid, the receipt and sufficiency of which are hereby
acknowledged, CAMPUS CREST AT HUNTSVILLE, LP, a Delaware limited partnership (“Borrower’’),
does hereby TRANSFER, ASSIGN AND DELIVER unto AMEGY MORTGAGE COMPANY, L.L.C. d/b/a Q 10
Amegy Mortgage Capital, a Texas limited liability company (“Lender”) all of the rights,
interests, benefits and privileges of Borrower under (i) that contract dated May 28,
2008, between JAMES L. BROWNING; as architect (“Design Professional”),
and Borrower, as owner (“Owner”), providing for design services relating to the
construction of certain improvements (“Improvements) upon certain real property situated in
WALKER County, Texas, as more particularly described on Exhibit “A” attached hereto (the
“Property”); and (ii) all plans and specifications prepared by Design Professional (“Plans and
Specifications”) covering and relating to such construction and Improvements (the Plans and
Specifications and the above referenced contract are hereinafter collectively referred to as
the “Contract”); however, Lender does not hereby assume any of Borrower’s liabilities, duties
or obligations under the Contract.

     This Assignment of Rights under Design Professional’s Contract and of Plans and
Specifications (the “Assignment”) constitutes a part of the security for the payment of that
certain Promissory Note dated June ___, 2009 (the “Note”), in the principal sum of THIRTEEN
MILLION THREE HUNDRED FIFTY–FIVE THOUSAND AND NO/100 DOLLARS ($13,355,000.00), executed by
Borrower and payable to the order of Lender, which Note is secured by that certain Deed of
Trust and Security Agreement of even date with the Note (the “Deed of Trust”) executed by
Borrower for the benefit of Lender. Lender shall not exercise any rights hereunder unless an
Event of Default, as defined under the terms and conditions of that certain Development Loan
Agreement (“Loan Agreement”) dated of even date with the Note, between Borrower and Lender,
shall have occurred and be continuing. The Loan Agreement relates to the loan (the “Loan”)
evidenced by the Note, Deed of Trust, Loan Agreement and various other documents relating
thereto,

     If and when the indebtedness evidenced by the Note shall have been fully
paid and satisfied and the obligations of Borrower under the Loan Agreement shall have been
performed and satisfied without the necessity of Lender exercising its rights hereunder, this
Assignment shall terminate and thereafter be of no further effect.

     Design Professional executes this Assignment for the purpose of evidencing Design
Professional’s consent to this Assignment and Design Professional’s knowledge of the content
hereof; further, to evidence Design Professional’s agreement to make available to Lender the
Contract (including the Plans and Specifications) and continue under the terms of the Contract at Lender’s request, provided that Design Professional shall be paid for all work
performed on the Property, Design Professional acknowledges that by acceptance hereof, Lender
is not assuming any obligations that Borrower has to Design Professional.

     Design Professional further agrees that Design Professional shall furnish Lender
written notice of an event of default by Borrower of any of
Borrower’s obligations under the
Contract, and give Lender an opportunity to cure said default within a reasonable
period of time, but never less than ten (10) business days, prior to terminating the Contract
or taking any other action in relation thereto because of said default.

     Design Professional further agrees that Design Professional shall not perform services
pursuant to any Change Order, as such term is defined in the Contract, which
will result in greater than $50,000 for any single Change Order or $250,000 for
all Change Orders in the aggregate, unless Design Professional shall have received
Lender’s specific

 

 

written approval of such Change Order. In the event Design Professional fails to secure such
written approval, Design Professional’s Contract with Borrower shall, for the purpose of Design
Professional’s obligation aforesaid to continue performance thereunder for Lender’s benefit, be
deemed not to have been modified by such Change Order.

     As
further inducement to Lender to make the Loan to Borrower, Design Professional has agreed
and does hereby covenant and agree with and for the benefit of Lender, its successors and assigns,
that any and all liens, rights, claims, debts, demands, charges, causes of action and interest
(whether choate or inchoate and including, without limitation, all mechanic’s and materialmen’s
liens under the Constitution and statutes of the State of Texas) owned or claimed on the
improvements, fixtures or furnishings now or hereafter constructed, placed or situated thereon, are
now and shall be in all respects subordinate and inferior to the liens and security interests
created for the benefit of Lender, its successors and assigns, under and by virtue of the Deed of
Trust (and any and all renewals, rearrangements and extensions thereof).

     This
Assignment may be executed in multiple counterparts, and each counterpart hereof executed
by any party shall be deemed an original and shall as to such party constitute one and the same
instrument with all other counterparts hereof executed, regardless of whether the same or any other
counterpart hereof is executed by any other party or by a person intended to be or who becomes a
party hereunder.

     This Assignment shall be governed by the law of the jurisdiction in which the real property
encumbered by the Deed of Trust is located, without giving effect to its conflict of laws rules.

     IN
WITNESS WHEREOF, this Assignment is executed as of the ___ day of June, 2009.

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

	 	 	BORROWER:
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	CAMPUS CREST AT
HUNTSVILLE, LP, a Delaware limited partnership
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	HSRE-CC Huntsville GP, LLC, a Delaware limited liability company,
	 	 	 	 	its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	HSRE-Campus Crest I, LLC, a Delaware limited liability
	 	 	 	 	 	 	company, its sole member	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	By:	 	Campus Crest Ventures
III, LLC, a Delaware limited
	 	 	 	 	 	 	 	 	liability company, a member	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	By:	 	Campus Crest Properties, LLC, a North	 	 
	 	 	 	 	 	 	 	 	 	 	Carolina limited liability company, its	 	 
	 	 	 	 	 	 	 	 	 	 	Manager	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	By:	 	 
	 

	 	 	 	 	 	 	 	 	 	 	 	Michael S. Hartnett, Manager	 	 

2

 

	 	 	 	 	 
	 	LENDER:

AMEGY MORTGAGE COMPANY, L.L.C. d/b/a

Q10 Amegy Mortgage Capital, a Texas limited

liability company

 
	 	By:  	 	 
	 	 	Don Hickey, Senior Vice President- 	 
	 	 	Commercial Real Estate Lending 	 
	 
	 	DESIGN PROFESSIONAL:

	 
	 
	 	JAMES L. BROWNING 	 
	 

	 	 	 	 	 

	THE STATE OF  	 	 	 	§
	 

	 	 	 	§
	COUNTY OF  

	 	 	 	§

     This
instrument was acknowledged before me on the ___ day of
June, 2009, by Michael S.
Hartnett, Manager of Campus Crest Properties, LLC, a North Carolina limited liability company, in
its capacity as Manager of Campus Crest Ventures III, LLC, a Delaware limited liability company, in
its capacity as a member of HSRE-Campus Crest I, LLC, a Delaware limited liability company, in its
capacity as sole member of HSRE-CC Huntsville GP,
LLC, a Delaware limited liability company, in its capacity as general
partner of CAMPUS CREST
AT HUNTSVILLE, LP, a Delaware limited partnership, on behalf of said limited partnership.

	 	 	 	 	 
	 	 
	 	Notary Public, State of
 	 
	 	 	 
	 	My commission expires: 	 
	 	 	 
	 

	 	 	 	 	 

	THE STATE OF TEXAS	 	 	§
	 

	 	 	 	§
	COUNTY OF  

	 	 	 	§

     This
instrument was acknowledged before me on this ___ day of June, 2009, by Don Hickey, Senior
Vice President — Commercial Real Estate Lending of AMEGY
MORTGAGE COMPANY, L.L.C. d/b/a Q10 Amegy
Mortgage Capital, a Texas limited liability company, on behalf of said limited liability company.

	 	 	 	 	 
	 	 	 
	 	Notary Public, State of Texas
	 	 
	 	 	 
	 	My commission expires:	 	 
	 	 	 
	 

3

 

	 	 	 	 	 

	 	 	 	 	 

	THE STATE OF TEXAS	 	 	§
	 

	 	 	 	§
	COUNTY OF  

	 	 	 	§

     This
instrument was acknowledged before me on this ___ day of
June, 2009, by JAMES L.
BROWNING.

	 	 	 	 	 
	 
	 	Notary Public, State of Texas

 	 

Exhibit:

“A” — Property Description

4

 

EXHIBIT “E”

FORM OF COMPLIANCE LETTER

     The undersigned is a licensed architect/registered engineer (“Design Professional”) and has
been retained by CAMPUS CREST AT HUNTSVILLE, LP (“Borrower”) to perform professional services in
connection with development and/or construction of Improvements on
The Grove, Huntsville, Texas (the
“Project”). Reference is heremade to that certain Construction Loan Agreement (the “Loan
Agreement”) executed by and between Borrower and Amegy Mortgage Company, L.L.C. d/b/a Q10 Amegy
Mortgage Capital (“Lender”) relating to the financing of
costs of construction of Improvements for
the Project. All capitalized terms used herein but not herein defined shall have the meanings given
in the Loan Agreement.

     The undersigned hereby certifies that he/she has either prepared or reviewed the Plans and the
Master Plan for the Project and further certifies that if and when the Improvements are completed
substantially as designed, said Improvements will be in compliance with all applicable local, state
and federal ordinances, laws, rules and regulations and in compliance with any conditions or
requirements to obtain and maintain any permits required for occupancy of said Improvements.

	 	 	 	 	 

	Dated:
	 	 	 	 
	 

	 	 

	 	 

	 	 	 	 	 

	 

	 	DESIGN PROFESSIONAL:	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	 

JAMES L BROWNING
	 	 

 

 

EXHIBIT “F”

Loan
No.99-10-71154

AFFIDAVIT
OF COMMENCEMENT OF WORK

(Commercial Construction)

	 	 	 	 	 

	THE STATE OF TEXAS

	 	§
	 	 
	 

	 	§	 	 
	COUNTY OF WALKER

	 	§	 	 

     BEFORE
ME, the undersigned authority, on this the
      day of
                    ,200 ___, personally appeared
MICHAEL S. HARTNETT, as Manager on behalf of CAMPUS CREST AT HUNTSVILLE, LP (“Owner”), and as
Manager on behalf of CAMPUS CREST CONSTRUCTION, LLC, a North Carolina limited liability company
(“Contractor”), who, being by me duly sworn did depose and say:

     “That, the undersigned, as Owner and Contractor entered into a Construction contract (the
“Construction Contract”) the
                    
day of                      ,200 ___for the construction of certain Improvements on the
real property (the “Property”) described as follows:

     SEE
EXHIBIT “A” ATTACHED HERETO AND MADE A PART HEREOF FOR ALL PURPOSES.

     “The name and address of the Owner is: CAMPUS CREST AT HUNTSVILLE, LP, 2100 Rexford Road, Suite
414, Charlotte, North Carolina 28211.

     “The name and address of the Contractor who will furnish the labor, service and/or materials
for the construction of the improvements is: CAMPUS CREST CONSTRUCTION, LLC, a North Carolina
limited liability company, 2100 Rexford Road, Suite 414, Charlotte, North Carolina 28211.

     “The earliest date that materials were delivered to the Property or that the work actually
commenced is the ___day of                     , 200___.”

	 	 	 	 	 	 	 	 	 	 	 

	 	 	CAMPUS CREST CONSTRUCTION, LLC, a North

Carolina limited liability company	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	Campus Crest Group, LLC, a North Carolina limited

liability company, Manager	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	Madeira Group, LLC, a North Carolina

limited liability company, Manager	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:	 	 	 	 
	 

	 	 	 	 	 	 	 	 

Michael S. Hartnett, Manager
	 	 

 

 

	 	 	 	 	 	 	 	 	 	 	 	 	 

	 	 	CAMPUS CREST AT HUNTSVILLE, LP, a Delaware limited partnership
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By: 	HSRE-CC Huntsville GP, LLC, a Delaware limited liability company, its General Partner
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By: 	HSRE-Campus Crest I, LLC, a Delaware limited liability company, its sole member
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	By: 	Campus Crest Ventures III, LLC, a Delaware limited liability company, a member
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	By: 	Campus Crest Properties, LLC, a North Carolina limited liability company, its Manager
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	By: 	 	 
	 

	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 	Michael S. Hartnett, Manager

	 	 	 	 	 

	THE STATE OF

	 	 
	 	§
	 

	 	 	 	 
	 
	 	 	 	 
	COUNTY OF

	 	 
	 	§
	 

	 	 	 	 

     This instrument was acknowledged before me on the                      day of                                       
  , 200___, by Michael S.
Hartnett, Manager of Madeira Group, LLC, a North Carolina limited liability company, in its
capacity as Manager of Campus Crest Group, LLC, a North Carolina limited liability company, in its
capacity as Manager of CAMPUS CREST CONSTRUCTION, LLC, a North Carolina limited liability company,
on behalf of said limited liability company.

	 	 	 	 	 

	 	 	 
	 

	 	Notary Public, State of	 	 
	 

	 	 	 	 
	 

	 	My commission expires:	 	 
	 

	 	 	 	 

	 	 	 	 	 

	THE STATE OF

	 	 
	 	§
	 

	 	 	 	 
	 
	 	 	 	 
	COUNTY OF

	 	 
	 	§
	 

	 	 	 	 

     This instrument was acknowledged before me on the                      day of                                 
        , 200___, by Michael S.
Hartnett, Manager of Campus Crest Properties, LLC, a North Carolina limited liability company, in
its capacity as Manager of Campus Crest Ventures III, LLC, a Delaware limited liability company, in
its capacity as a member of HSRE-Campus Crest I, LLC, a Delaware limited liability company, in its
capacity as sole member of HSRE-CC Huntsville GP, LLC, a Delaware limited liability company, in its
capacity as general partner of CAMPUS CREST AT HUNTSVILLE, LP, a Delaware limited partnership,
on behalf of said limited partnership.

	 	 	 	 	 
	 
	 	 	 
	 

	 	Notary Public, State of	 	 
	 

	 	 	 	 
	 

	 	My commission expires:	 	 
	 

	 	 	 	 

AFFIDAVIT OF COMMENCEMENT

2

 

EXHIBIT “G-1”

PARTIAL WAIVER AND RELEASE OF LIEN

	 	 	 

	THE STATE OF TEXAS

	 	§
	 

	 	§
	COUNTY OF WALKER

	 	§

     The undersigned is a contractor or subcontractor or materialman who has furnished services, labor
or materials in the construction, repair and/or replacement (the “Work”) of improvements upon
certain real property situated in WALKER County, Texas, and owned by
CAMPUS CREST AT HUNTSVILLE, LP
(“Owner”), which property is more particularly described on Exhibit “A” which is attached hereto
and incorporated herein by reference.

	 	 	 	 	 	 	 

	 

	 	The undersigned has furnished:	 	 	 	 
	 

	 	 	 	 

	 	 

 

(Described Nature of Labor/Materials used for the Work)

	 	 	 	 	 

	Original Contract Sum
	 	$	 	 
	 
	 	 	 	 
	Net Change by Change Orders
	 	$	 	 
	 
	 	 	 	 
	Contract Sum to Date
	 	$	 	 
	 
	 	 	 	 
	Total Completed & Stored to Date
	 	$	 	 
	 
	 	 	 	 
	Retainage
	 	$	 	 
	 
	 	 	 	 
	Total Earned Less Retention
	 	$	 	 
	 
	 	 	 	 
	Less: Previous Certificates for Payment
	 	$	 	 
	 
	 	 	 	 
	Current Payment
	 	$	 	 
	 
	 	 	 	 

     The total of all charges for all such services, labor and/or materials performed or furnished by
the undersigned to the date hereof is $                     , and, except for the amount of the Current
Payment, the undersigned has received payment in full therefor. The undersigned hereby acknowledges
satisfaction of and waives and releases all liens and claims to liens which the undersigned may
have as a result of the performance or furnishing of such services, labor or materials.

     The undersigned has further represented and warranted and does hereby represent and warrant that
(a) it has not assigned and will not assign any claim for payment or any right to perfect a lien
against the Property, (b) all persons or entities who have furnished services, labor or materials
to the undersigned in connection with the Work have been paid all amounts to which they have or may
become entitled therefore, and (c) the undersigned’s portion of the Work to date is fully completed
in accordance with the final plans and specifications therefor.

 

 

     The person signing this document represents that he is duly authorized to do so on behalf of the
undersigned contractor, subcontractor or materialman.

	 	 	 	 	 	 	 

	 

	 	EXECUTED this the                      day of	 	 .	 	 
	 

	 	 	 	 

	 	 

	 	 	 	 	 	 	 	 	 

	 	 	   
	 	 	(name of contractor, subcontractor or materialman)
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	   
	 

	 	Printed Name:
	 	 	 
	 	 	 	 	 	 	   
	 

	 	Title:	 	 	 	 	 	 
	 	 	 	   

     SWORN TO AND SUBSCRIBED TO BEFORE ME, the undersigned authority, on this the          
            day of         
                  
              .

	 	 	 	 	 	 	 

	 	 	   
	 	 	Notary Public, State of Texas
	 
	 

	 	My Commission Expires:	 	 	 	 
	 

	 	 	 	 

	 	 

Exhibit:

“A” — Property Description

AFTER RECORDING RETURN TO:

AMEGY MORTGAGE COMPANY, L.L.C.

d/b/a Q10 Amegy Mortgage Capital

4576 Research Forest Drive

The Woodlands, Texas 77381

PARTIAL WAIVER-LIEN

2

 

EXHIBIT “G-2”

FINAL WAIVER AND RELEASE OF LIEN

	 	 	 

	THE STATE OF TEXAS

	 	§
	 

	 	§
	COUNTY OF WALKER

	 	§

     The
undersigned is a contractor, subcontractor or materialman who has furnished services, labor
or materials in the construction, repair and/or replacement (the “Work’) of improvements upon
certain real property situated in WALKER County, Texas, and owned by
CAMPUS CREST AT HUNTSVILLE, LP (“Owner”), which property is more particularly described on Exhibit “A” which is attached hereto
and incorporated herein by reference.

	 	 	 	 	 

	 

	 	The undersigned has furnished:	 	 
	 

	 	 	 	 

 

(Described Nature of Labor/Materials used for the Work)

	 	 	 	 	 

	Original Contract Sum
	 	$	 	 
	 
	 	 	 	 
	Net Change by Change Orders
	 	$	 	 
	 
	 	 	 	 
	Contract Sum to Date
	 	$	 	 
	 
	 	 	 	 
	Total Completed & Stored to Date
	 	$	 	 
	 
	 	 	 	 
	Retainage
	 	$	 	 
	 
	 	 	 	 
	Total Earned Less Retention
	 	$	 	 
	 
	 	 	 	 
	Less: Previous Certificates for Payment
	 	$	 	 
	 
	 	 	 	 
	Current Payment
	 	$	 	 
	 
	 	 	 	 

     The total of all charges for and in connection with all such services, labor
and/or materials performed or furnished by the undersigned has been paid in full to
the undersigned. The undersigned hereby acknowledges complete satisfaction of and
hereby absolutely and forever waives and releases all claims of every kind against
Owner or the Property, or any other property of Owner, including but not
limited to all liens and claims of liens, which the undersigned may have as a result of
or in connection with the performance or furnishing of such services, labor or
materials.

     The undersigned has further represented and warranted and does hereby represent
and warrant that (a) it has not assigned and will not assign any claim for payment or
any right to perfect a lien against the Property, (b) all persons or entities
who have furnished services, labor or materials to the undersigned in
connection with the Work have been paid all amounts to which they have or may
become entitled therefor, and (c) the undersigned’s portion of the Work is fully
completed in accordance with the final plans and specifications therefor.

     The person signing this document represents that he is duly authorized to do so on
behalf of the undersigned contractor, subcontractor or materialman.

 

 

	 	 	 	 	 	 	 

	 

	 	EXECUTED this the                      day of	 	 	. 	 
	 

	 	 	 	 
	 	 

	 	 	 	 	 
	 
	 	(name
of contractor, subcontractor materialman) 

 	 
	 	By:  	 	 
	 	 	Printed Name:  	  	 
	 	 	Title:  	 	 
	 

     SWORN TO AND SUBSCRIBED TO BEFORE ME, the undersigned authority,
on this the ___ day of                          
        .

	 	 	 	 	 	 	 

	 	 	   
	 	 	Notary Public, State of Texas
	 
	 

	 	My Commission Expires:	 	 	 	 
	 

	 	 	 	 

	 	 

Exhibit:

“A” — Properly Description

AFTER RECORDING RETURN TO:

AMEGY MORTGAGE COMPANY, L.L.C.

d/b/a Q10 Amegy Mortgage Capital

4576 Research Forest Drive

The Woodlands, Texas 77381

FINAL WAIVER LIEN 

2

 

EXHIBIT “H”

AFFIDAVIT
OF COMPLETION

	 	 	 

	THE STATE OF TEXAS

	 	§
	 

	 	§
	COUNTY OF WALKER

	 	§

     BEFORE ME, a Notary Public in and for the State of Texas on this day personally
appeared MICHAEL S. HARTNETT, Manager on behalf of CAMPUS CREST AT
HUNTSVILLE, LP (the
“Owner”, whether one or more) who, after having been by me duly sworn, on oath stated as
follows:

     1. Owner, whose address is 2100 Rexford Road, Suite 414,
Charlotte, North Carolina 28211, is the Owner of real properly (the “Real
Property”) situated in WALKER County, Texas, more particularly described
as follows:

SEE EXHIBIT “A” ATTACHED HERETO AND MADE A PART HEREOF FOR ALL
PURPOSES.

     2. Improvements (herein so called) were constructed and furnished under the original
contract (the “Contract”) with CAMPUS CREST CONSTRUCTION, LLC, a North Carolina limited
liability company (the “Original Contractor”), whose address is 2100 Rexford Road, Suite
414, Charlotte, North Carolina 28211, which Improvements are described as follows:

Construction of a commercial improvement.

     3. The Improvements under the Contract between the Owner and the Original Contractor have
been completed except for warranty and repair work, if any. The date of such
completion was the ___ day of                     , 200___.

NOTICE: A CLAIMANT MAY NOT HAVE A LIEN ON

RETAINED FUNDS UNLESS THE CLAIMANT

FILES THE AFFIDAVIT CLAIMING A LIEN NOT LATER

THAN THE 30TH DAY AFTER THE DATE OF COMPLETION.

	 	 	 	 	 
	 	AFFIANT:

 	 
	 	  	 	 
	 	 	MICHAEL S. HARTNETT, solely in his              	 
	 	 	capacity as authorized representative of Owner
and not individually 	 

 AFFIDAVIT OF COMPLETION 

1

 

     SUBSCRIBED AND SWORN TO BEFORE ME on this the           
day of
___, 200           , to certify which witness my hand and
seal of office.

	 	 	 	 	 

	 	 	 
	 

	 	Notary Public, State of	 	 
	 

	 	 	 	 
	 
	 

	 	My commission expires:	 	 
	 

	 	 	 	 
	 

AFFIDAVIT
OF COMPLETION

2

 

EXHIBIT “I-1”

Loan No.

CONTRACTOR

FINAL BILLS PAID AFFIDAVIT AND RELEASE

	 	 	 

	THE STATE OF TEXAS

	 	§
	 

	 	§
	COUNTY OF

	 	§

               WHEREAS,                  
                              (“Contractor”) has entered into a contract (the “Contract”) calling
for the construction of certain improvements (the “Project”) on real property (the
“Property”), more particularly described as follows:

SEE
EXHIBIT “A” ATTACHED HERETO AND MADE A PART
HEREOF FOR ALL PURPOSES; and,

     WHEREAS, the Contractor has submitted a request for payment for labor and/or materials supplied
for the project.

     NOW THEREFORE, in consideration of the payment of Ten Dollars and No/100
($10.00) and other good and valuable consideration to the Contractor made simultaneous
with the execution and delivery hereof, the undersigned Contractor states, represents
and warrants to CAMPUS CREST AT HUNTSVILLE, LP, as owner
(“Owner”) and AMEGY
MORTGAGE COMPANY, L.L.C. d/b/a Q10 Amegy Mortgage Capital, as lienholder on the Project (“Lender”) as follows:

	 	l.	 	Contractor has performed labor or supplied materials or both, for improvements upon the Property
as part of the Project.
	 
	 	2.	 	Contractor has performed labor or supplied materials or both in a good and workmanlike
manner upon the Property to the extent that Contractor is now due $           as of
the date hereof as the final payment under the Contract. Contractor acknowledges full
payment of this sum.
	 
	 	3.	 	With the exception of payments to be made with the proceeds of the
final draw request, all sums now due from Contractor to any subcontractors or vendors for
labor or materials have been paid in full.
	 
	 	4.	 	The undersigned Contractor further certifies that with the exception of payments to be made
with the proceeds of the final draw request, all labor, material, taxes and/or insurance costs
incurred by the undersigned in completing its portion of the Project have
been paid, and the undersigned hereby indemnifies and agrees to hold the owner of the
Property and the Property harmless from any claims, causes of action, damages or losses
incurred by any of them, including reasonable attorney’s fees, in defense thereof, for and
on account of any breach hereof by the undersigned;
	 
	 	5.	 	This is a final lien waiver and release. Contractor hereby waives, releases and relinquishes
any and all claims, demands, rights and liens heretofore or currently existing that Contractor
may have, whether those claims or liens are contractual, statutory or constitutional, and

 

EXHIBIT
“I-2”

OWNER’S
AFFIDAVIT OF BILLS PAID

	 	 	 

	STATE
OF TEXAS

	 	§
	 
	COUNTY
OF WALKER

	 	§

     BEFORE ME, the undersigned authority, on this day personally
appeared the person whose name is subscribed hereto, being by me first duly sworn upon
his or her oath deposes and says:

     THAT the undersigned (“Affiant”) is acting on behalf of and as the duly
authorized representative of CAMPUS CREST AT HUNTSVILLE, LP (“Owner”), whether one or
more. Owner contracted with one or more original contractors (collectively the
“Contractors”, whether one or more) who performed labor, built or provided specially
fabricated materials, and/or furnished labor or material in the construction of the
improvements upon certain real property (the “Property”) described as follows:

     SEE
EXHIBIT “A” ATTACHED HERETO AND MADE A PART HEREOF
FOR ALL PURPOSES.

     AFFIANT further says that all improvements contracted by Owner with the Contractors
to be constructed have been completed and that all bills from
contractors, laborers and suppliers and others contracting with Owner for materials and
labor used in construction of said improvements have been paid in full.

     AFFIANT acknowledges and agrees that AMEGY MORTGAGE COMPANY, L.L.C. d/b/a Q10
Amegy Mortgage Capital (the “Lender”) and Chicago Title Insurance Company (the
“Title Company”) are each specifically and materially relying upon the facts
herein stated by Affiant to be true in connection with a loan
disbursement by Lender to or on behalf of Owner and for the purpose
of inducing the Title Company to issue a T-3 endorsement to the
existing Mortgage Title Policy issued to Lender.

     AFFIANT further acknowledges and understands that there are criminal penalties
for making any false or misleading statement in this Affidavit.

	 	 	 	 	 
	 	MICHAEL
S. HARTNETT, solely in his 

capacity as authorized representative of Owner

                         Affiant

 	 
	 	 	 
	 	 	 
	 	 	 

6

 

	 	 	 	 	 

	 	 	 	whether they are perfected or unperfected, in whole or
in part, upon the Property or against Contractor. The
sum paid as specified under paragraph 2 hereof is in
full and final payment of the Contract.
	 
	 	6.	 	Contractor is the sole owner of all claims for the sums now due and no
portion has been assigned, pledged or otherwise disposed of or
hypothecated, and Contractor has the full power and right to execute this
Affidavit and Release.
	 
	 	7.	 	The person signing this document represents that he or she is
duly authorized to do so on behalf of the undersigned Contractor. All
of the provisions of this document shall bind the undersigned Contractor
and the Contractor’s heirs, legal representatives, successors and assigns
and shall inure to the benefit of the Owner of the Property and
Lender and their respective heirs, legal representatives, successors,
assigns and sureties.

	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 

	 	EXECUTED this the                      day of	 	 	,	 	.	 
	 

	 	 	 	 
	 	 
	 	 

	 	 	 	 	 
	 	 	 	 
	 	  	 	 
	 	 	Name:  	 	 
	 	 	Title:
 	 	 
	 
	 	 	
 	Contractor	 

	 	 	 

	THE STATE OF
	 	§
	 
	COUNTY OF
	 	§

     This
instrument was acknowledged before me on the
                    
day of                      
,
200                    
,

by               
              
              
               
    ,                 
                                            
of                                          , on behalf of said Contractor.

	 	 	 	 	 
	 	  	 	 
	 	 	Notary  Public in and for 	 	 
	 	 	The State of  	 	 

	 	 	 	 	 
	 
	 	 	My commission expires:	 

CONTRACTOR FINAL BILLS PAID

AFFIDAVIT AND RELEASE

2

 

THE STATE OF                                          §

COUNTY OF                                          §

     This instrument was subscribed, sworn to and acknowledged before me on the                      day of
                                        , 200                     by MACHAEL S. HARTNETT.

	 	 	 	 	 
	 	  	 	 
	 	 	Notary  Public in and for 	 	 
	 	 	The State of	 	 

	 	 	 	 	 
	 
	 	 	My commission expires:	 

2

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