LEASE AGREEMENT [EDUCATION REALTY OPERATING PARTNERSHIP, LP

LEASE AGREEMENT

[EDUCATION REALTY OPERATING PARTNERSHIP, LP
a Delaware limited partnership]

Landlord

AND

[PLACE PROPERTIES, L.P.,
a Tennessee limited partnership]

Tenant

As of __________, 2005

1

LEASE AGREEMENT

THIS LEASE AGREEMENT (this “ Lease ”) is dated as of the       day of       , 2005, but effective as of       , 2005, and is between [EDUCATION REALTY OPERATING PARTNERSHIP, LP, a Delaware limited partnership] “( Landlord ”), and [PLACE PROPERTIES, L.P., a Tennessee limited partnership] (“ Tenant ”).

W I T N E S S E T H:

WHEREAS, Landlord owns fee simple title to the Leased Property (this and other capitalized terms used and not otherwise defined herein having the meanings ascribed to such terms in Article 1 ); and

WHEREAS, Landlord desires to lease the Leased Property to Tenant, and Tenant desires to lease the Leased Property from Landlord, on the terms and conditions herein set forth.

NOW THEREFORE, for and in consideration of the premises, the covenants and representations herein made and other good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, Landlord and Tenant do hereby agree as follows:

ARTICLE 1

DEFINITIONS

For all purposes of this Lease, except as otherwise expressly provided or unless the context otherwise requires, (a) the terms defined in this Article have the meanings assigned to them in this Article and include the plural as well as the singular, (b) all accounting terms not otherwise defined herein have the meanings assigned to them in accordance with GAAP as at the time applicable, (c) all references in this Lease to designated “Articles”, “Sections” and other subdivisions are to the designated Articles, Sections and other subdivisions of this Lease, and (d) the words “herein”, “hereof” and “hereunder” and other words of similar import refer to this Lease as a whole and not to any particular Article, Section or other subdivision:

Additional Charges : As defined in Section 3.5 .

Additional Rent : As defined in Section 3.4 .

Additional Rent Base : As defined in Section 3.4 .

Additional Rent Year : For purposes of this Lease, the annual twelve month period from August 1 to July 31.

Affiliate : When used with respect to any corporation, limited liability company, or partnership, any person, corporation, limited liability company, partnership or other legal entity, which, directly or indirectly, controls or is controlled by or is under common control with such corporation, limited liability company, or partnership. For the purposes of this definition, “ control ” (including the correlative meanings of the terms “ controlled by ” and “ under common control with ”), as used with respect to any person, corporation, limited liability company, partnership or other legal entity, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such person, corporation, limited liability company, partnership or other legal entity, through the ownership of voting securities, partnership interests or other equity interests, by contract, or otherwise.

Agreement : This Lease, as it may be amended from time to time as herein provided.

Agreement of Principals : As defined in Section 23.2 .

Award : As defined in Section 11.1 .

Base Rent : As defined in Section 3.2 .

Business Day : Each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which money centers in the City of New York, New York are authorized, or obligated, by law or executive order, to close.

Capital Expenditure : Any expenditure treated as capital in nature in accordance with GAAP.

Cash Collateral : As defined in Section 3.9(h) .

Code : The Internal Revenue Code of 1986, as amended, and, to the extent applicable, the Treasury Regulations promulgated thereunder, each as from time to time amended.

Commencement Date :       , 2005.

Condemnation : As defined in Section 11.1 .

Condemnor : As defined in Section 11.1 .

Consumer Price Index : The Consumer Price Index, all urban consumers, all items, U.S. City Average, published by the United States Department of Labor, Bureau of Labor Statistics, in which 1982-1984 equals one hundred (100). If the Consumer Price Index is discontinued or revised during the Term, such other governmental index or computation with which it is replaced shall be used in order to obtain substantially the same result as would be obtained if the Consumer Price Index had not been discontinued or revised.

Date of Taking : As defined in Section 11.1 .

Encumbrance : As defined in Article 15.1 .

Entity : Any corporation, general or limited partnership, limited liability company or partnership, stock company or association, joint venture, trust, bank, business trust, Governmental Authority, or any other legal entity.

Event of Default : As defined in Section 12.1 .

Existing Lender : As defined in Section 15.4 .

Existing Loan Agreement . As defined in Section 15.4 .

Existing Mortgage Loan : As defined in Section 15.4 .

Extension Notice : As defined in Section 2.3 .

Extension Term : As defined in Section 2.3 .

Financial Officer’s Certificate : A certificate of the chief financial officer of Tenant, accompanying the financial statements required to be delivered by Tenant pursuant to Section 3.4 and Section 14.2 (i), (ii) and (iii) , in which such officer shall certify that to such officer’s best knowledge such statements have been prepared in accordance with GAAP, are true, correct and complete in all material respects, and fairly present the financial condition of Tenant at and as of the dates thereof and the results of its operations for the periods covered thereby, subject only to normal year-end audit adjustments, if applicable.

Fiscal Year : The fiscal year for this Lease shall be the twelve (12) month period from January 1 to December 31.

Fixed Term : As defined in Section 2.2 .

Fixtures : As defined in Section 2.1 .

Full Replacement Cost : As defined in Section 9.1 .

GAAP : Generally accepted accounting principles as consistently applied in the United States and in effect from time to time.

Governmental Authority : Any federal, state, county, municipal, or other governmental authority or quasi-governmental authority, commission, agency, board, office or instrumentality of any nature whatsoever having jurisdiction over the Leased Property or any portion thereof or the Leased Improvements operated thereon.

Gross Rentals : As defined in Section 3.4 .

Hazardous Materials : Any substance which is toxic, explosive, corrosive, flammable, infectious, radioactive, carcinogenic, or otherwise hazardous and is or becomes regulated by any Governmental Authority including without limitation, asbestos or any substance containing asbestos and deemed hazardous under any Hazardous Materials Law, the group of organic compounds known as polychlorinated biphenyls, flammable explosives, radioactive materials, lead and lead based paint, urea formaldehyde foam insulation, radon gas, infectious wastes, biomedical and medical wastes, chemicals known to cause cancer or reproductive toxicity, pollutants, effluents, contaminants, emissions or related materials and any items included in the definition of hazardous or toxic wastes, materials or substances under any Hazardous Materials Law.

Hazardous Materials Laws : All local, state and federal laws or rule of common law, consent order, judicial order, administrative order or other governmental directive that applies to Tenant or to the Leased Property and relates to Hazardous Materials including, without limitation, those relating to industrial hygiene or the use, analysis, generation, manufacture, storage, discharge, release, disposal, transportation, treatment, investigation, or remediation of Hazardous Materials, including, without limitation, the Resource Conservation and Recovery Act of 1976 (“RCRA”), the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (“CERCLA”), as amended by the Superfund Amendments and Reauthorization Act of 1986 (“SARA”), the Hazardous Materials Transportation Act, 49 U.S.C. §6901, et seq., the Federal Water Pollution Control Act, 33 U.S.C. §§1251 et seq., the Clean Air Act, 42 U.S.C. §§741 et seq., the Clean Water Act, 33 U.S.C. §7401, et seq., the Toxic Substances Control Act, 15 U.S.C. §§2601-2629, the Safe Drinking Water Act, 42 U.S.C. §§300f-300j, and all similar federal, state and local environmental statutes, ordinances and the regulations, orders, or decrees now or hereafter promulgated thereunder.

Impositions : Collectively, all real property and personal property taxes, assessments (including, without limitation, all assessments imposed under instruments which encumber title to the Leased Property and all assessments for public improvements or benefits to the Leased Property, whether or not commenced or completed prior to the date hereof and whether or not to be completed within the Term), water, sewer or other rents and charges, all excises, tax levies, fees (including, without limitation, license, permit, inspection, authorization and similar fees), and all other governmental charges, in each case whether general or special, ordinary or extraordinary, or foreseen or unforeseen, of every character in respect of the Leased Property and/or the Rent (including all interest and penalties thereon due to any failure in payment by Tenant), which at any time prior to, during or in respect of the Term may be assessed or imposed on or in respect of or be a lien upon (a) Landlord or Landlord’s interest in the Leased Property, (b) the Leased Property or any part thereof or any rent therefrom or any estate, right, title or interest therein, or (c) any occupancy, operation, use or possession of, sales from, or activity conducted on, or in connection with, the Leased Property or the leasing or use of the Leased Property or any part thereof; provided, however, nothing contained in this Lease shall be construed to require Tenant to pay (1) any tax based on net income (whether denominated as a franchise or capital stock, financial institutions or other tax) imposed on Landlord, or (2) any net revenue tax of Landlord, or (3) any transfer fee or tax imposed with respect to the subsequent sale, exchange or other disposition by Landlord of any portion of the Leased Property or the proceeds thereof, or (4) any principal or interest on any Encumbrance on the Leased Property.

Indebtedness : With respect to Tenant, all obligations, contingent or otherwise, which in accordance with GAAP should be reflected on Tenant’s balance sheet as liabilities.

Insurance Requirements : All terms of any insurance policy required by this Lease.

Interest Rate : An annual interest rate equal to the annual interest rate announced by Citibank in New York, New York as its prime rate or base rate (which rate shall change automatically and simultaneously from time to time with each change in the announced prime rate) plus two percent (2%).

Land : As defined in Section 2.1(a) .

Landlord : As defined in the Preamble and any permitted successor or assign thereof.

Landlord’s Notice Address : As defined in Section 22.1 .

Lease : As defined in the Preamble.

Lease Extension Operating Test : As defined in Section 2.3 .

Lease Year : A twelve (12) consecutive calendar month period falling within the Term, with the first Lease Year commencing on the first day of the first calendar month beginning on or after the Commencement Date and each subsequent Lease Year commencing on each anniversary of the first day of the first Lease Year under this Lease. The period, if any, from the Commencement Date to the beginning of the first Lease Year shall be treated as if it were a part of the first Lease Year under this Lease.

Leased Improvements : As defined in Section 2.1 .

Leased Property : As defined in Section 2.1 .

Legal Requirements : All federal, state, county, municipal and other governmental statutes, laws, rules, orders, regulations, ordinances, judgments, decrees and injunctions affecting Tenant’s operation of its business on the Leased Property, the Leased Property or the construction, use or alteration of the Leased Improvements (including, without limitation, the Americans With Disabilities Act and Section 504 of the Rehabilitation Act of 1973) whether now or hereafter enacted and in force, including any which may (a) require repairs, modifications, or alterations in or to the Leased Property, or (b) in any way adversely affect the use and enjoyment thereof, and all permits, licenses, authorizations and regulations relating thereto, and all covenants, agreements, restrictions and encumbrances contained in any instruments, either of record or known to Tenant (other than encumbrances created by Landlord without the consent of Tenant), at any time in force affecting the Leased Property.

Letter of Credit : As defined in Section 3.9 .

Management Agreement : Any contracts and agreements entered into by Tenant for the management of any or all of the Projects.

Manager : Any person, firm, corporation or other entity or individual engaged by Tenant to manage any Project pursuant to a Management Agreement.

Mold . Any microbial or fungus contamination or infestation in the Leased Improvements of a type and magnitude which poses a risk to human health or the environment or would materially, negatively impact the value of the Leased Property, or any portion thereof.

Net Operating Income : With respect to any period of calculation, determined on an accrual basis, the excess of (i) all revenues, receipts, and payments of every kind arising from ownership and operation of the Leased Property, including all payments of rents from subtenants of the Projects (but excluding condemnation and insurance proceeds, except to the extent such proceeds are with respect to rent or business interruption insurance, and excluding tenant deposits and prepaid rent not actually applied during such period), over (ii) Operating Expenses attributable to such period of calculation.

Notice : A notice given in accordance with Section 22.1 .

Officer’s Certificate : A certificate of Tenant signed by the Manager, the President, any Vice President or the Treasurer of Tenant or another officer or representative authorized to so sign by the governing body of Tenant, or any other person whose power and authority to act has been authorized by delegation in writing by any of the persons holding the foregoing offices.

Operating Expenses : With respect to any period of calculation, all costs and expenses accrued in accordance with GAAP relating to the operation, maintenance, repair, use and management of the Leased Property, including, without limitation, utilities, repairs and maintenance, insurance, property taxes and assessments, advertising expenses, payroll and related taxes, equipment lease payments, and management fees equal to the lesser of (a) actual management fees, or (b) a management fee equal to 3% of gross rentals for such period, but excluding (i) payments of Base Rent, Additional Rent, and penalties and interest payable to Landlord under this Lease; (ii) depreciation, amortization and other non-cash expenses of Tenant with respect to the Leased Property; (iii) Capital Expenditures to the extent paid by Landlord; (iv) the cost of providing any Letter of Credit or Additional Letter of Credit to be provided by Tenant under this Lease; and (v) any fine, penalty, interest, and cost required to be paid by Tenant as a result of non-payment or late payment of any Additional Charges required to be paid by Tenant. Operating Expenses shall also include the amount of any deductible expense incurred by Tenant in connection with damage or destruction of any Project during the Term.

Organizational Documents : As defined in Section 16.3 .

Overdue Rate : On any date, the rate per annum which is the lesser of (i) fifteen percent (15%) or (ii) the highest rate allowed by the laws of the State.

Permitted Use : As defined in Section 4.2 .

Person : Any individual or Entity, and the heirs, executors, administrators, legal representatives, successors and assigns of such Person where the context so admits.

Project : With respect to each individual Property described in Section 2.1, the student housing oriented residential apartment complex being operated on such Property.

Project Mortgage : Any Encumbrance placed upon Landlord’s interest in a Property.

Project Mortgagee : The holder of any Project Mortgage.

Property : As defined in Section 2.1.

Rent : Collectively, the Base Rent, the Additional Rent, and the Additional Charges.

Single Purpose Entity : An entity which (i) exists solely for the purpose of leasing the Leased Property and operating the Projects, (ii) conducts business only in its own name, (iii) does not engage in any business other than the operation of the Projects, (iv) does not hold, directly or indirectly, any ownership interest (legal or equitable) in any entity or any real or personal property other than the interest in the Leased Property which it leases from Landlord hereunder, (v) does not have any assets other than those related to its interest in the Leased Property pursuant to this Lease and does not have any debt other than as permitted by this Lease and does not guarantee or otherwise obligate itself with respect to the debts of any other person or entity, (vi) has its own separate books, records, accounts and financial statements (with no commingling of funds or assets), (vii) holds itself out as being a company separate and apart from any other entity, and (viii) observes limited liability company/partnership/corporate formalities, as the case may be, independent of any other entity.

Taking : A taking or voluntary conveyance during the Term of all or part of the Leased Property, or any interest therein or right accruing thereto or use thereof, as the result of, or in settlement of, any Condemnation or other eminent domain proceeding affecting the Leased Property whether or not the same shall have actually been commenced.

Tangible Net Worth : For any Entity, the excess of total assets over total liabilities, as determined in accordance with GAAP, but excluding from the determination of total assets goodwill, organizational expenses, and other similar intangibles.

Tenant : As defined in the Preamble and any successor and assign herein permitted.

Tenant Related Party : Any Affiliate of Tenant and any partner, member, manager, officer, director, or employee of Tenant or any Affiliate of Tenant.

Term : The actual duration of this Lease from and after the Commencement Date, including the Fixed Term and the Extension Terms (if exercised by Tenant) and taking into account any early termination.

Termination Fee : As defined in Section 2.4(b) .

Unsuitable for its Permitted Use : By reason of damage or destruction, or a partial Taking by Condemnation, any Project cannot be operated on a commercially practicable basis for the Permitted Use, taking into account all relevant factors, and the effect of such damage or destruction or partial Taking.

ARTICLE 2

LEASED PROPERTY AND TERM

2.1 Leased Property. Upon and subject to all of the other terms and conditions set forth in this Lease, Landlord leases to Tenant and Tenant rents from Landlord the following (each of items (a) through (e) below which, as of the Commencement Date, relates to any single Project, a “ Property ” and, collectively, the “ Leased Property ”):

(a) those certain tracts or parcels of land more particularly described in Exhibits A-1 through A-13 attached hereto and made a part hereof (the “ Land ”);

(b) all buildings, structures, and other improvements of every kind located on the Land, including, but not limited to, the apartment buildings, clubhouses, mail buildings, tennis courts, swimming pools, recreational facilities, sidewalks, utility pipes, conduits and lines (on-site and off-site), parking areas and driveways appurtenant to such buildings and structures presently or hereafter situated upon the Land (collectively, the “ Leased Improvements ”);

(c) all easements, rights and appurtenances relating to the Land and the Leased Improvements;

(d) all equipment, machinery, fixtures and other items of real and/or personal property, including all components thereof, now and hereafter located in, on or used in connection with, and permanently affixed to or incorporated into the Leased Improvements, including, without limitation, all furnaces, boilers, heaters, electrical equipment, heating, plumbing, lighting, ventilating, refrigerating, incineration, waste disposal, air-cooling and air-conditioning systems and apparatus, cable or satellite television systems, sprinkler systems and fire and theft protection equipment, all of which, to the greatest extent permitted by law, are hereby deemed by the parties hereto to constitute real estate, together with all replacements, modifications, alterations and additions thereto (collectively, the “ Fixtures ”); and

(e) all equipment, appliances, furniture, furnishings, supplies, and other tangible personal property of any kind or description used or useful in connection with the operation of the Leased Improvements, and located on or in the Leased Improvements, and all modifications, replacements, alterations and additions to such personal property, except items, if any, included within the category of Fixtures (collectively, the “ Leased Personal Property ”).

2.2 Fixed Term. The initial Term of this Agreement (the “ Fixed Term ”) shall commence on the Commencement Date and shall expire on       , 2010.

2.3 Extension Rights. So long as no Event of Default has occurred and is continuing under this Lease, and subject to satisfaction of the Lease Extension Operating Test for such extension period, Tenant shall have the option (the “ Extension Option ”) to extend the Fixed Term of this Lease for three (3) additional successive periods of five (5) years each (each an “ Extension Term ”). Said Extension Option shall be subject, however, to the following terms and conditions:

(a) Tenant shall exercise each such Extension Option by giving written notice to Landlord at least six (6) months prior to the expiration of the Fixed Term or the then current Extension Term, as applicable (the “ Extension Notice ”). Notwithstanding the foregoing, in the event Tenant fails to give notice of its election to extend at least six (6) months prior to the expiration of the Fixed Term or then current Extension Term, as the case may be, then Landlord shall notify Tenant in writing of such failure and thereafter Tenant shall have an additional fifteen (15) days to exercise the Extension Option by giving an Extension Notice to Landlord; and in the event Tenant fails to exercise the Extension Option within such fifteen (15) day period, then Tenant shall be deemed to have waived the Extension Option, and the Term shall expire at the end of the Fixed Term or then current Extension Term, as applicable.

(b) No Event of Default shall exist on the date of commencement of any Extension Term.

(c) Tenant shall have delivered to Landlord, on or before the first day of the applicable Extension Term, a renewal or extension of the Letter of Credit or a substitute letter of credit, upon the same terms and in the same amount (as the same may have been adjusted pursuant to Section 3.9(n) ) as the expiring Letter of Credit and otherwise acceptable to Landlord, which renewed, extended, or substituted letter of credit shall be maintained in effect, by automatic renewal or extension, until the date which is thirty (30) days after expiration of the subject Extension Term. Any such renewed, extended, or substituted letter of credit shall be deemed the “ Letter of Credit ” under this Lease during the subject Extension Term and shall be held and governed pursuant to the terms of Section 3.9 below which are applicable to the original Letter of Credit, including without limitation the provisions of said Section 3.9 which permit the reduction of the Letter of Credit from time to time.

Notwithstanding the foregoing, in the event that Net Operating Income from the Leased Property, calculated on a trailing 12 month basis (excluding any Net Operating Income attributable to any Property which has been released from this Lease), shall have been not less than an amount equal to 1.05 times annual Base Rent (excluding Base Rent attributable to any Property which has been released from this Lease) for the eight (8) consecutive calendar quarters immediately preceding the calendar month in which an Extension Term commences, Tenant shall not be required to provide and maintain a Letter of Credit during such Extension Term.

The Base Rent for each Extension Term shall be adjusted and reallocated among the Properties as of the first day of such Extension Term as provided in Section 3.3 below, and the Additional Rent Base shall be adjusted as of the first day of such Extension Term as provided in Section 3.4 below.

Except for such adjustment of Base Rent and the Additional Rent Base, all of the terms, covenants and conditions of this Lease shall continue in full force and effect during each Extension Term, as if such Extension Term were part of the original Term.

For purposes of this Section 2.3 , the “ Lease Extension Operating Test ” for any Extension Term shall mean that annualized Net Operating Income from the Leased Property (excluding any Net Operating Income attributable to any Property which has been released from this Lease) for the three (3) calendar month period ending on the last day of the calendar month which is two (2) months prior to the calendar month in which the applicable Extension Term commences shall be not less than 1.05 times the annual Base Rent payable during such three (3) month calendar month period (excluding any Base Rent attributable to any Property which has been released from this Lease).

2.4 Landlord’s Early Termination Rights.

(a) Net Operating Income Shortfall . Notwithstanding anything to the contrary provided in this Lease, Landlord shall have the right to terminate this Lease upon not less than thirty (30) days advance Notice to Tenant if any of the following events occur:

(i) Net Operating Income from the Leased Property, calculated on a trailing 12 month basis (excluding any Net Operating Income attributable to any Property which has been released from this Lease prior to the end of such 12 month period), shall have been less than an amount equal to 1.05 times annual Base Rent (excluding Base Rent attributable to any Property which has been released from this Lease) for the immediately preceding eight (8) consecutive calendar quarters; provided, however, that Landlord shall not be entitled to exercise its termination right under this subsection 2.4(a)(i) prior to the expiration of ten (10) full calendar quarters following the Commencement Date; or

(ii) Net Operating Income from the Leased Property, calculated on a trailing 12 month basis (excluding any Net Operating Income attributable to any Property which has been released from this Lease prior to the end of such 12 month period), shall have been less than 0.80 times annual Base Rent (excluding Base Rent attributable to any Property which has been released from this Lease) for the immediately preceding two (2) consecutive calendar quarters; provided, however, that Landlord shall not be entitled to exercise its termination right under this subsection 2.4(a)(ii) prior to the expiration of four (4) full calendar quarters following the Commencement Date.

Any such Notice of termination shall be given within thirty (30) days following Landlord’s receipt of the financial statements delivered pursuant to Section 14.2 which show the results of operations which give rise to the right of termination described above, or Landlord shall be deemed to have waived its right of termination pursuant to this Section 2.4(a) with respect to the period of operations covered by such financial statements.

(b) Sale of Property . Subject to the transfer restrictions of Section 20.1 , Landlord shall have the right to terminate this Lease as to any individual Property upon not less than sixty (60) days advance Notice to Tenant in connection with the sale of such Property to an Entity which is not an Affiliate of Landlord; provided, however, that Landlord shall not be entitled to exercise its termination right under this subsection 2.4 (b) prior to the fourth (4 ^th ) Lease Year. In the event that Landlord elects to terminate this Lease during the Fixed Term or the first year of the first Extension Term as to the entire Leased Property in connection with a sale of the entire Leased Property to a non-Affiliate in a single transaction or a series of related transactions, Landlord shall pay to Tenant a termination fee (a “ Termination Fee ”) equal to (i) $1.5 million, if such termination occurs during the fourth (4 ^th ) Lease Year, (ii) $1.0 million, if such termination occurs during the fifth (5 ^th ) Lease Year, and (iii) $0.5 million, if such termination occurs during the sixth (6 ^th ) Lease Year (if the Lease is extended after the Fixed Term). In the event that Landlord elects to terminate this Lease as to any individual Property in connection with the sale thereof during Lease Years 4 or 5 or, if the Lease is extended after the Fixed Term, Lease Year 6, Landlord shall pay to Tenant a termination fee with respect to such Property equal to such Property’s allocable share of the applicable Termination Fee set forth above, which allocable share shall correspond to such Property’s allocable share of the Base Rent, as established pursuant to Section 3.2 or Section 3.3 , as applicable below. After the sixth (6 ^th ) Lease Year no Termination Fee shall be payable in connection with a total or partial termination of this Lease by Landlord under this subsection 2.4(b).

2.5 Tenant’s Early Termination Right. Tenant shall have the right to terminate this Lease upon not less than sixty (60) days advance Notice to Landlord at any time after any of the following events occur:

(a) the Leased Property, or so much thereof as remains subject to the terms of this Lease from time to time, is sold in its entirety to an Entity which is not an Affiliate of Landlord or an Entity resulting from a consolidation or merger of Landlord;

(b) the termination of this Lease with respect to more than seven (7) of the individual Properties, whether as a result of Landlord’s sale of such individual Properties, casualty, or otherwise; or

(c) the termination of this Lease as to a Property by reason of a sale by Landlord of such Property pursuant to Section 2.4(b) (other than (i) any foreclosure sale under any Superior Mortgage, as defined in Section 15.2 , (ii) any conveyance in lieu of a foreclosure under any such Superior Mortgage, or (iii) any Condemnation), if, as a result of such termination, the Net Operating Income from the remaining Properties would fall below an amount equal to 1.10 times annual Base Rent (excluding the Base Rent attributable to the Property sold), based upon the Net Operating Income of the remaining Properties for the most recent calendar quarter for which financial statements have been provided pursuant to Section 14.2 .

In the event that Tenant exercises such termination right during the Fixed Term or the first Lease Year of the first Extension Term, Landlord shall be required to pay to Tenant a Termination Fee calculated in the manner described in Section 2.4(b) above.

2.6 No Other Termination. Except as otherwise specifically provided in this Agreement, each of Landlord and Tenant, to the maximum extent permitted by law, shall remain bound by this Lease in accordance with its terms and, without the consent of the other, shall not take any action without the consent of the other to modify, surrender or terminate this Lease. Except as otherwise expressly provided in this Lease, the respective obligations of Landlord and Tenant shall not be affected by reason of (a) any damage to, or destruction of, Leased Property or any portion thereof from whatever cause or any Taking of the Leased Property or any portion thereof, or (b) any bankruptcy, insolvency, reorganization, composition, readjustment, liquidation, dissolution, winding up or other proceedings affecting Landlord or any assignee or transferee of Landlord. Except as otherwise specifically provided in this Agreement or as may be provided at law or in equity, Tenant hereby specifically waives all rights, arising from any occurrence whatsoever, which may now or hereafter be conferred upon it by law to modify, surrender or terminate this Lease or quit or surrender the Leased Property or any portion thereof. The obligations of Landlord and Tenant hereunder shall be separate and independent covenants and agreements and the Rent and all other sums payable by Tenant hereunder shall continue to be payable in all events unless the obligations to pay the same shall be terminated pursuant to the express provisions of this Lease.

ARTICLE 3

RENT

3.1 Rental Payments.

(a) Beginning on the Commencement Date and continuing thereafter throughout the Term, Tenant hereby agrees to pay the Rent due and payable under this Lease. As used in this Lease, the term “ Rent ” shall mean Base Rent (as defined in Section 3.2 below), Additional Rent (as defined in Section 3.4 below), and the Additional Charges (as defined in Section 3.5 below). Base Rent shall be payable without demand on the fifteenth (15 ^th ) day of each calendar month during the Term. If the Term commences on a day other than the first day of a month, or terminates on a day other than the last day of a month, the Base Rent for the first and last partial month shall be prorated based upon the actual number of days in such a month. Except as specifically set forth in this Lease, Rent shall be due and payable in all events, without any setoff or deduction whatsoever, unless expressly allowed hereunder. All payments of Rent shall be made in legal tender at the address of Landlord set forth in Section 22.1 hereof, or at such other place as Landlord shall designate from time to time in writing.

(b) No payment by Tenant or acceptance by Landlord of an amount less than the Rent herein stipulated shall be deemed a waiver of any additional amount due. No partial payment or endorsement on any check or any letter accompanying any payment of Rent shall be deemed an accord and satisfaction, but Landlord may accept such payment without prejudice to Landlord’s right to collect the balance of any Rent due under the terms of this Lease.

(c) Whenever in this Lease a payment is required to be made by one party to the other, but a specific date for payment is not set forth or a specific number of days within which payment is to be made is not set forth, or the words “immediately,” “promptly” and/or “on demand,” or the equivalent, are used to specify when such payment is due, then such payment shall be due ten (10) days after the party which is entitled to such payment sends written notice to the other party demanding payment.

(d) To the extent that Tenant is required to deliver all revenues and receipts from the Leased Property to the Existing Lender and the Existing Lender applies such revenues and receipts to fund obligations of Landlord under the Existing Loan Documents, the amounts so applied by the Existing Lender shall be credited against Tenant’s obligations with respect to Base Rent and Additional Rent hereunder, as more particularly described in Section 15.4(g) hereof.

3.2 Base Rent.

(a) Subject to adjustment as provided in Section 3.3 , Article 10 , and Article 11 , Tenant shall pay Landlord base rent (the “ Base Rent ”) in an amount equal to THIRTEEN MILLION SEVEN HUNDRED THIRTY SIX THOUSAND SEVEN HUNDRED FIFTY AND NO/100 Dollars ($13,736,750.00) per annum. Base Rent shall be payable in advance in equal, consecutive monthly installments on the fifteenth (15 ^th ) day of each calendar month of the Term, commencing after Commencement Date (prorated as to any partial month).

(b) Landlord and Tenant agree that during the Fixed Term the Base Rent shall be allocated among the Properties as set forth in Exhibit B attached hereto and by this reference made a part hereof. In the event that this Lease is extended in accordance with Section 2.3 above, Base Rent shall be reallocated among the Properties in accordance with the terms of Section 3.3(b) below.

3.3 Adjustments to Base Rent.

(a) In the event that the Fixed Term of this Lease is extended in accordance with Section 2.3 above, Base Rent payable during the subject Extension Term shall be increased or decreased over the Base Rent payable during the Fixed Term or immediately preceding Extension Term, as applicable, by an amount equal to the product of the annual Base Rent payable during such immediately preceding period multiplied by the percentage increase or decrease in the Consumer Price Index for the period between the first month of the Fixed Term or immediately preceding Extension Term, as applicable, and the month which is four (4) months prior to the first month of the applicable Extension Term.

(b) In the event that the Fixed Term of this Lease is extended in accordance with Section 2.3 above, the Base Rent applicable during such Extension Term shall be reallocated among the Properties, or so many of the Properties as remain subject to this Lease, as of the first day of the applicable Extension Period, so that the Base Rent attributable to each Property shall bear the same proportion to total Base Rent as the Gross Rentals from such Property for the immediately preceding Additional Rent Year bear to total Gross Rentals from all Properties for such immediately preceding Additional Rent Year (excluding Gross Rentals attributable to any Property which is no longer subject to the Lease). For example, if the Gross Rentals generated by a Property during the last full Additional Rent Year of the Fixed Term or an Extension Term represent twelve percent (12%) of the total Gross Rentals during such Additional Rent Year from all Properties which remain subject to this Lease as of the first day of the next following Extension Term, then twelve percent (12%) of the Base Rent under this Lease during such Extension Term shall be allocated to such Property. Within thirty (30) days after the commencement of an Extension Term, Landlord and Tenant shall enter into an addendum to this Lease acknowledging the reallocation of Base Rent among the Properties in accordance with this subparagraph (b), and such revised allocation shall supersede Exhibit B hereto for the remainder of such Extension Term.

(c) In the event that any individual Property is released from the terms of this Lease in connection with the sale thereof as described in Section 2.4(b) or in connection with the termination of this Lease as to such Property as a result of casualty or condemnation pursuant to Article 10 or 11 hereof, Base Rent shall be reduced by the affected Property’s allocable share of Base Rent, as determined by reference to Section 3.2(b) or 3.3(b) above, as applicable.

3.4 Additional Rent.

(a) In addition to Base Rent, Tenant shall pay to Landlord additional rent (“ Additional Rent ”) equal to forty one percent (41%) (the “ Applicable Percentage ”) of the amount by which the Gross Rentals from the Leased Property for each Additional Rent Year, or fraction thereof falling within the Term of this Lease, shall exceed the Additional Rent Base (as hereinafter defined) applicable to such Additional Rent Year, or an appropriate fraction thereof if the period in question during the Term hereof shall be less than a full Additional Rent Year. The Applicable Percentage will remain constant in the event that the Fixed Term of this Lease is extended in accordance with Section 2.3 .

(b) As used herein, during the Fixed Term “ Additional Rent Base ” shall mean as follows:

In the first Lease Year of the Fixed Term: $23,481,624

In the second Lease Year of the Fixed Term: $23,716,440

In the third Lease Year of the Fixed Term: $23,953,605

In the fourth Lease Year of the Fixed Term: $24,193,141

In the fifth Lease Year of the Fixed Term: $24,435,072

For purposes of calculating Additional Rent due hereunder, the Additional Rent Base for the period from the Commencement Date to July 31, 2006 shall equal a pro rata portion of the Additional Rent Base for the first Lease Year, i.e., $23,481,624 times [Insert the fraction determined by dividing the number of days between the Commencement Date and July 31, 2006 by 365] . The Additional Rent Base for subsequent Additional Rent Years shall equal the sum of (i) a pro rata portion of the Additional Rent Base for any Lease Year ending during such Additional Rent Year, plus (ii) a pro rata portion of the Additional Rent Base for any Lease Year beginning during such Additional Rent Year, in each case based on the number of months of each such Lease Year which fall within the applicable Additional Rent Year. For example, for the Additional Lease Year commencing on August 1, 2006, the Additional Rent Base shall be the sum of (i) $       , representing [insert applicable fraction] of the Additional Rent Base for the first Lease Year, plus (ii) $       , representing [insert applicable fraction] of the Additional Rent Base for the second Lease Year.

In the event that the Term of this Lease is extended in accordance with Section 2.3, the Additional Rent Base for first Lease Year of the subject Extension Term shall be the Additional Rent Base for the first Lease Year of the Fixed Term or immediately preceding Extension Term, as applicable, multiplied by the percentage increase or decrease in the Consumer Price Index for the period between the first month of the Fixed Term or immediately preceding Extension Term, as applicable, and the month which is four (4) months prior to the first month of the applicable Extension Term, with this new Additional Rent Base to increase after the first Lease Year of the Extension Term by one percent (1%) per year during the remainder of such Extension Term. In the event this Lease shall terminate with respect to any individual Property in accordance with the terms of Section 2.4(b) or Article 10 or Article 11 , the Additional Rent Base for the period after the effective date of such termination shall be reduced in an amount proportionate to the reduction in Base Rent resulting from the release of the affected Property from this Lease, as determined by reference to Section 3.3(c) hereof.

(c) The term “Gross Rentals” as used in this Lease shall include all rentals and other sums or consideration received by Tenant from subtenants or other persons for or in respect of any use or occupation of the Leased Property or any part thereof during the Term of this Lease (whether pursuant to lease, concession, license, franchise or otherwise), including without limitation apartment rental, clubhouse rental, fees for cable or telecom services, income generated through leases for laundry services and equipment, non-refundable application fees, and non-refundable security deposits or security deposits forfeited as rent from subtenants, as well as proceeds of rent or business interruption insurance paid for the relevant period of calculation in respect of such subtenant rents, but excluding any interest or dividends earned on Tenant’s investment of surplus cash.

So long as Landlord shall desire to qualify for taxation as a real estate investment trust, the term “Gross Rentals” shall be deemed to not include any amounts referred to above which, if included in the definition of “Gross Rentals,” would result in any part of the fixed rental and/or additional rental payable to Landlord hereunder being held not to constitute “rents from real property” as that term is defined in Section 856(d) of the Internal Revenue Code of 1954 and the regulations issued thereunder, as the same may be amended from time to time.

(d) Additional Rent for each Additional Rent Year or portion thereof shall be calculated and paid annually in arrears. Within sixty (60) days after the end of each Additional Rent Year during the Term, commencing September 30, 2006, and within sixty (60) days after the end of the final Lease Year of the Term or the prior termination of this Lease, as the case may be, Tenant shall deliver to Landlord (i) a Financial Officer’s Statement containing (A) a detailed report of the Gross Rentals for the Leased Property for the preceding Additional Rent Year (or fraction thereof), as audited by the approved accountants, and (B) Tenant’s computation of Additional Rent payable for such Additional Rent Year, or applicable portion thereof, and (ii) Tenant’s check in payment of the Additional Rent due and payable for such Additional Rent Year. All costs of audit of Tenant’s reports of Gross Rentals shall be paid by Landlord.

(e) Tenant shall utilize, or cause to be utilized, an accounting system for each Property in accordance with its usual and customary practices and in accordance with GAAP, which will accurately record all Gross Rentals from each Property and Tenant shall retain, for at least three (3) years after the expiration of each Additional Rent Year, reasonably adequate records conforming to such accounting system showing all Gross Rentals for such Property for such Additional Rent Year. Landlord, at its own expense, except as provided hereinbelow, shall have the right, exercisable by Notice to Tenant within one (1) year after receipt of the statement referred to in subsection (d) above, by its accountants or representatives to audit the information set forth in such statement and, in connection with such audit, to examine Tenant’s and the Manager’s books and records with respect thereto (including supporting data). If any such audit discloses a deficiency in the payment of Additional Rent and either Tenant agrees with the result of such audit or the matter is otherwise compromised with or resolved in favor of Landlord, Tenant shall forthwith pay to Landlord the amount of the deficiency, as finally agreed or determined, together with interest at the Interest Rate from the date such payment should have been made to the date of payment thereof. If such deficiency, as agreed upon, compromised, or resolved as aforesaid, is more than four percent (4%) of the Gross Rentals reported by Tenant for such Additional Rent Year and, as a result, Landlord did not receive at least ninety five percent (95%) of the Additional Rent payable with respect to such Additional Rent Year, Tenant shall pay the reasonable cost of such audit and examination. If any such audit discloses that Tenant paid more Additional Rent for any Additional Rent Year than was due hereunder, and either Landlord agrees with the result of such audit or the matter is otherwise determined, Landlord shall grant Tenant a credit equal to the amount of such overpayment against Base Rent and Additional Rent next coming due in the amount of such difference, as finally agreed or determined, together with interest at the Interest Rate, which interest shall accrue from the time of Tenant’s statement of Gross Rentals until the date such credit is applied and paid, as the case may be. If such a credit cannot be made because the Term has expired before the credit can be applied in full, Landlord shall pay the unapplied balance of such credit to Tenant, together with interest at the Interest Rate, which interest shall accrue until the date of payment from Landlord.

3.5 Additional Charges. In addition to the Base Rent and Additional Rent payable hereunder, Tenant shall pay to the appropriate parties and discharge as and when due and payable the following (collectively, the “ Additional Charges ”):

(a) Impositions . Subject to the terms of Article 8 relating to permitted contests and except to the extent paid by any Project Mortgagee, Tenant will pay, or cause to be paid, all Impositions before any fine, penalty, interest or cost may be added for non-payment, such payments to be made directly to the taxing authorities or other party to whom such Imposition is payable where feasible, and Tenant will promptly, upon request, furnish to Landlord copies of official receipts or other satisfactory proof evidencing such payments. Tenant’s obligation to pay the Impositions shall be deemed absolutely fixed upon the date the Imposition becomes a lien upon the Leased Property or any part thereof. If any Imposition may, at the option of the Landlord, lawfully be paid in installments (whether or not interest shall accrue on the unpaid balance of such Imposition), Tenant may exercise the option to pay the same (and any accrued interest on the unpaid balance of such Imposition) in installments and, in such event, shall pay such installments during the Term (subject to Tenant’s right of contest pursuant to the provisions of Article 8 ) as the same respectively become due and before any fine, penalty, premium, further interest or cost may be added thereto. Landlord, at its expense, shall prepare and file all tax returns and reports as may be required by Governmental Authorities in respect of Landlord’s net income, gross receipts, franchise taxes and taxes on its capital stock, and Tenant, at its expense and to the extent permitted by applicable laws and regulations shall prepare and file all tax returns and reports in respect of any Imposition as may be required by Governmental Authorities. If any refund shall be due from any taxing authority in respect of any Imposition paid by Tenant, the same shall be paid over to or retained by Tenant. Landlord and Tenant shall, upon request of the other, provide such data as is maintained by the party to whom the request is made with respect to the Leased Property as may be necessary to prepare any required returns and reports. In the event Governmental Authorities classify any property covered by this Lease as personal property, Tenant shall file all personal property tax returns in such jurisdictions where filing is required and Tenant may legally make such filing. Landlord, to the extent it possesses the same, and Tenant, to the extent it possesses the same, will provide the other party, upon request, with cost and depreciation records necessary for filing returns for any property so classified as personal property. Where Landlord is legally required to file personal property tax returns, Tenant will be provided with copies of assessment notices indicating a value in excess of the reported value in sufficient time for Tenant to file a protest. All Impositions assessed against such personal property shall be (irrespective of whether Landlord or Tenant shall file the relevant return) paid by Tenant not later than the last date on which the same may be made without interest or penalty, except to the extent such Impositions are to be paid by any Project Mortgagee.

(b) Adjustment of Impositions . Impositions imposed in respect of the tax-fiscal period during which the Term terminates shall be adjusted and prorated between Landlord and Tenant, whether or not such Imposition is imposed before or after such termination, and Tenant’s obligation to pay its prorated share thereof shall survive such termination.

(c) Utility Charges . Tenant will contract for, in its own name or the name of the Property, and will pay or cause to be paid all charges for electricity, power, gas, oil, water, telephone, cable television, internet access, and other utilities used in connection with the operation of the Leased Property. Landlord will provide any bonds, guarantees or deposits required by any utility service providers.

(d) Insurance Premiums . Tenant shall pay or cause to be paid all premiums for the insurance coverage required to be maintained by Tenant pursuant to Article 9 .

(e) Other Charges . Tenant shall pay or cause to be paid all other amounts, liabilities and obligations with respect to the operation of the Leased Property.

(f) Reimbursement for Additional Charges . If Tenant pays or causes to be paid, or deposits in escrow with any Project Mortgagee any amounts for the payment of, property taxes or similar or other Additional Charges attributable to periods after the end of the Term, whether upon expiration or sooner termination of this Agreement, Tenant may, within a reasonable time after the end of the Term, provide Notice to Landlord of its estimate of such amounts. Landlord shall promptly reimburse Tenant for all payments or deposits of such taxes and other similar Additional Charges that are attributable to any period after the Term of this Agreement.

3.6 Monthly Impounds. Tenant agrees that, if at any time any Project Mortgagee requires Landlord to deposit funds monthly with such Project Mortgagee for the payment of Impositions, then in addition to the monthly installments of Base Rent required pursuant to Section 3.2 , Tenant shall deposit monthly with such Project Mortgagee, on the day of each month required by such Project Mortgagee, a sum equal to the estimated Impositions required to be deposited by such Project Mortgagee. If the total monthly payments made by Tenant under this Section 3.6 shall exceed the amount actually payable by Tenant for any such Imposition, such excess shall be credited against subsequent monthly payments of Base Rent or Additional Rent due hereunder, or such excess shall be returned to Tenant. If the total monthly payments made by Tenant under this Section 3.6 shall be insufficient to pay such Impositions when due, the Tenant shall upon demand pay to Landlord or, at Landlord’s direction, to the applicable Project Mortgagee the amount necessary to make up the deficiency. To the extent that Tenant complies with this Section 3.6 and makes such payments to Landlord or a Project Mortgagee, Tenant shall be relieved from compliance with the provisions of this Article 3 which require the direct payment of such Impositions by Tenant. In the event of default in the payment of any monthly or any other installment provided for in this Section 3.6 , Landlord shall have the same remedies as those provided for in this Lease for default in the payment of Rent. To the extent received by Tenant, Tenant shall deliver to Landlord any bills received by Tenant for all Impositions for which deposits are being made, in ample time to enable Landlord to cause the applicable Project Mortgagee to pay the same before interest or penalty shall accrue. Landlord shall be furnished with reasonable proof from Tenant that such deposits are actually being made to a Project Mortgagee.

3.7 Late Payment of Rent, etc. If any installment of Base Rent, Additional Rent or Additional Charges (but only as to those Additional Charges which are payable directly to Landlord) shall not be paid within five (5) days after its due date, Tenant shall pay Landlord, on demand, as Additional Charges, a late charge (to the extent permitted by law) computed at the Overdue Rate on the amount of such installment, from the due date of such installment to the date of payment thereof. To the extent that Tenant pays any Additional Charges directly to Landlord or any Project Mortgagee pursuant to any requirement of this Agreement, Tenant shall be relieved of its obligation to pay such Additional Charges to the Entity to which they would otherwise be due. In the event of any failure by Tenant to pay any Additional Charges when due, Tenant shall promptly pay and discharge, as Additional Charges, every fine, penalty, interest and cost which is added by the Entity to which such Additional Charges are due for non-payment or late payment of such items. Such fines, penalties, interest and costs shall not constitute Operating Expenses for purposes of this Lease.

3.8 Net Lease. Rent shall be paid absolutely net to Landlord, so that this Lease shall yield to Landlord the full amount of Base Rent and Additional Rent throughout the Term, but subject to any other provisions of this Lease which expressly provide for adjustment of Rent or other charges.

3.9 Letter of Credit.

(a) Tenant shall, simultaneously with the delivery of this Lease, deliver to Landlord an irrevocable, stand-by letter of credit (a “ Letter of Credit ”) in the initial amount of Five Million and No/100 Dollars ($5,000,000.00) to assure the payment by Tenant of Base Rent and Additional Rent. The Letter of Credit shall be maintained in effect, by automatic renewal or extension, until the date (the “ LC Expiration Date ”) which is thirty (30) days after the expiration of the Fixed Term or earlier as set forth in Section 3.9(l) below.

(b) The Letter of Credit shall be in the form attached hereto as Exhibit C or in such other form as may be reasonably approved by Landlord and otherwise shall be subject to the provisions of this Section 3.9 . The Letter of Credit shall be issued by a national bank approved by Landlord in its sole but reasonable discretion (the “ Bank ”) and be “callable” by Landlord and payable through a branch office of the Bank located in the City of Memphis, Tennessee. The premium or purchase price of, or any other Bank fees associated with, such Letter of Credit shall be paid by Tenant (except those payable by Landlord pursuant to Section 3.9(e) below) and shall not constitute an Operating Expense for purposes of this Lease.

(c) The Letter of Credit shall (i) be subject to the International Standby Practices 1998, International Chamber of Commerce Publication No. 590, (ii) be fully transferable by Landlord only in connection with a transfer of Landlord’s interest in this Lease, including transfers by foreclosure or deed in lieu of foreclosure, and (iii) permit partial draws from time to time.

(d) In addition to the foregoing, the Letter of Credit shall provide that Landlord shall have the right to draw down for amounts of unpaid Base Rent and Additional Rent then currently due up to the face amount of the Letter of Credit upon the presentation to the Bank of the Letter of Credit and a Certificate signed by an officer of Landlord meeting the requirements set forth in the form of Letter of Credit attached hereto as Exhibit “C” .

(e) In the event of a transfer of Landlord’s interest in the Leased Property, Landlord shall transfer the Letter of Credit (or cause a substitute letter of credit to be delivered, as applicable) to the transferee, and it is agreed that the provisions hereof shall apply to every transfer of the Letter of Credit to a new Landlord. Landlord shall be responsible for all normal and customary charges of the Bank in connection with any such transfer.

(f) Except as described in subparagraph (h) below and in Section 12.2(d) , Landlord agrees not to draw upon the Letter of Credit unless an Event of Default by Tenant in paying Base Rent or Additional Rent has occurred under this Lease, after giving such notice thereof to Tenant as may be required in accordance with the terms of this Lease. If Landlord does effect such a “draw” under this subparagraph (f), such “draw” amount may only be made for (i) the past due amount of Base Rent or Additional Rent, or (ii) the amount of any deficiency in Net Operating Income pursuant to Section 12.2(c)(i) hereof. In no event shall Landlord be entitled to draw upon the Letter of Credit for accelerated Rent pursuant to Section 12.2(c)(ii) hereof.

(g) Any failure or delay of Landlord to “draw” any portion of the Letter of Credit shall not act as a waiver of Landlord’s right to do so at any time thereafter (through and until the LC Expiration Date) or constitute a waiver of any Event of Default with respect to this Lease.

(h) If the Letter of Credit is due to expire earlier than the LC Expiration Date, Tenant shall provide a renewal letter of credit (or amendment renewing the same) or substitute letter of credit (such renewal or amendment or substitute letter of credit to be in effect and delivered to Landlord, as applicable, not later than thirty (30) days prior to the expiration of the Letter of Credit), upon the same terms as the expiring Letter of Credit (except for permitted reductions in amounts) or such other terms as may be acceptable to Landlord in its reasonable discretion. If the Letter of Credit is not timely renewed or a substitute letter of credit is not timely received, or if Tenant fails to maintain the Letter of Credit in the amount and in accordance with the terms set forth in this Section, the Landlord shall have the right to draw upon the Letter of Credit in the full face amount thereof and hold all proceeds of the Letter of Credit as cash collateral (“ Cash Collateral ”) for the payment of Base Rent and Additional Rent. Landlord shall hold any Cash Collateral in an interest bearing account with a national banking association or other depository or a money market fund having a branch office in Memphis, Tennessee requested by Tenant and reasonably acceptable to Landlord, with any interest earned on such account to be for the sole benefit of Tenant except to the extent used to pay Base Rent or Additional Rent due Landlord. Landlord shall not co-mingle any Cash Collateral with other funds of Landlord. Landlord shall have no liability to Tenant with respect to the amount of interest paid on any such account.

(i) If there shall occur an Event of Default under the Lease with respect to payment of Base Rent or Additional Rent, Landlord may, but without obligation to do so, in addition to any other rights and remedies held by Landlord, draw upon the Letter of Credit and/or utilize the Cash Collateral in an amount necessary to collect the unpaid Base Rent or Additional Rent. No condition or term of this Lease shall be deemed to render the Letter of Credit conditional upon this Lease or to justify the issuer of the Letter of Credit in failing to honor a draw upon such Letter of Credit in a timely manner. In the event Landlord is determined through any dispute resolution procedure agreed upon by the parties or by a court of competent jurisdiction to have improperly drawn on the Letter of Credit, then Tenant shall be entitled to receive a prompt refund of such improper amount from Landlord (together with any bank fees and charges incurred by Tenant as a result thereof, interest at the Overdue Rate and all costs and fees, including legal fees and expenses incurred by Tenant in obtaining such refund).

(j) In the event Landlord draws upon the Letter of Credit or the Cash Collateral pursuant to subparagraph (i) above, Tenant agrees that within ten (10) Business Days after Tenant receives notice of such draw (i) in the case of any draw upon the Letter of Credit, Tenant will cause the Letter of Credit to be amended so that the amount available thereunder is restored to the amount available prior to such draw, and (ii) in the case of any draw upon the Cash Collateral, Tenant will deposit with Landlord an amount equal to the amount so drawn by Landlord, to be held as part of the Cash Collateral pursuant to the terms of this Lease. Any failure by Tenant to so restore the amount of the Letter of Credit or the Cash Collateral, as the case may be, shall constitute an Event of Default by Tenant under this Lease.

(k) Tenant acknowledges and agrees that the Letter of Credit constitutes a separate and independent contract between Landlord and the issuing bank, that Tenant is not a third party beneficiary of such contract, and that Landlord’s claim under the Letter of Credit for the full amount due and owing thereunder shall not be, in any way, restricted, limited, altered or impaired by virtue of any provision of the Bankruptcy Code.

(l) If this Lease is terminated prior to the LC Expiration Date and such termination is not the result of an Event of Default hereunder, or if this Lease is terminated as a result of an Event of Default but Tenant’s obligation with respect to any deficiency in Base Rent pursuant to Section 12.2(a)(i) shall have expired, the Letter of Credit or Cash Collateral, as applicable, shall be promptly returned by Landlord to Tenant, subject to any draws for unpaid Base Rent, Additional Rent, or Base Rent deficiencies which have previously been made by Landlord. In any event, the Letter of Credit or Cash Collateral shall be promptly returned to Tenant after Landlord has no further right to make any draws thereunder.

(m) Tenant will not assign or encumber Tenant’s interest in the Letter of Credit or Cash Collateral, as the case may be, or any part thereof, and neither Landlord nor Landlord’s successors or assigns will be bound by any such attempted assignment or encumbrance.

(n) Notwithstanding anything to the contrary provided in this Section 3.9, provided that (i) no uncured Event of Default shall exist, (ii) no amount of Base Rent or Additional Rent is due and unpaid, and (iii) no restoration of the amount of the Letter of Credit is required as of the time of any such reduction, then in the event that this Lease shall terminate with respect to any individual Property in accordance with the terms of Section 2.4(b) or Articles 10 or 11 , Tenant shall be entitled at any time thereafter to reduce the amount of the Letter of Credit in an amount proportionate to the reduction in Base Rent resulting from the release of such Property, as determined by reference to Section 3.3(c) hereof.

ARTICLE 4

CONDITION AND USE OF LEASED PROPERTY

4.1 Condition of the Leased Property. Tenant acknowledges receipt and delivery of possession of the Leased Property and that Tenant has examined and otherwise has acquired knowledge of the condition of the Leased Property prior to the execution and delivery of this Lease and has found the same to be in good order and satisfactory for its purpose hereunder. Tenant is leasing the Leased Property “as is” in its present condition, subject to the rights of parties in possession, the existing state of title (as evidenced by title insurance policies and endorsements issued to Landlord on the date of execution of this Lease, copies which have been made available to Tenant), including all covenants, conditions, restrictions, reservations, easements and other matters of record or that are visible or apparent on the Leased Property, all applicable Legal Requirements, the lien of any financing instruments, mortgages, deeds to secure debt, and deeds of trust existing as of the Commencement Date or permitted by the terms of this Agreement, and such other matters which would be disclosed by an inspection of the Leased Property. TENANT REPRESENTS THAT IT HAS INSPECTED THE LEASED PROPERTY AND ALL OF THE FOREGOING AND HAS FOUND THE CONDITION THEREOF SATISFACTORY AND IS NOT RELYING ON ANY REPRESENTATION OR WARRANTY OF LANDLORD OR LANDLORD’S AGENTS OR EMPLOYEES WITH RESPECT THERETO AND TENANT WAIVES ANY CLAIM OR ACTION AGAINST LANDLORD IN RESPECT OF THE CONDITION OF THE LEASED PROPERTY. LANDLORD MAKES NO WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED, IN RESPECT OF THE LEASED PROPERTY OR ANY PART THEREOF, EITHER AS TO ITS FITNESS FOR USE, SUITABILITY, DESIGN OR CONDITION FOR ANY PARTICULAR USE OR PURPOSE OR OTHERWISE, AS TO QUALITY OF THE MATERIAL OR WORKMANSHIP THEREIN, LATENT OR PATENT, IT BEING AGREED THAT ALL SUCH RISKS ARE TO BE BORNE BY TENANT.

4.2 Permitted Uses. During the Term, Tenant shall use or cause to be used the Leased Property as residential apartments and for such uses incidental thereto as may be permitted from time to time by applicable law and which may enhance the value, rental, or rental value thereof as student housing oriented residential apartment complexes (the “ Permitted Use ”). Tenant shall not use the Leased Property or any portion thereof for any other use without the prior written consent of Landlord, which Tenant agrees may be withheld in Landlord’s sole discretion.

4.3 Compliance with Legal and Insurance Requirements. Subject to Article 8 relating to permitted contests and subject to Landlord’s obligation to fund the cost of capital repairs and replacements pursuant to Section 5.2 hereof, Tenant, will promptly (a) comply with all Legal Requirements and Insurance Requirements in respect of the use, operation, maintenance, and repair of the Leased Property, and (b) procure, maintain and comply with all licenses and other authorizations obtainable by Tenant required for the Tenant’s use and operation of the Leased Property for the Permitted Use. Upon Landlord’s request, Tenant shall deliver copies of all such licenses and other authorizations.

4.4 Lawful Use, Etc. Tenant covenants and agrees that Tenant shall not knowingly use, suffer or permit the Leased Property to be used for any unlawful purpose. Tenant further covenants and agrees that Tenant shall not commit or suffer to be committed any waste on any Leased Property, nor shall Tenant knowingly cause or permit any unlawful nuisance thereon or therein.

4.5 Environmental Matters.

(a) During the Term, Tenant (i) shall comply, and cause the Leased Property to comply, with all Hazardous Materials Laws relating to the operation of the Leased Property, (ii) shall prohibit the use of the Leased Property for the generation, manufacture, refinement, production, or processing of any Hazardous Material or for the storage, handling, transfer or transportation of any Hazardous Material (other than in compliance with the Hazardous Materials Laws and in commercially reasonable quantities in connection with the operation, business and maintenance of the Leased Property as a residential apartment complex), (iii) shall not permit to remain, install or permit the installation on the Leased Property of any underground storage tanks, transformers containing polychlorinated biphenyl, or asbestos-containing materials, (iv) shall cause any improvements to or alterations of the Leased Property made by Tenant or its agents to comply with the Hazardous Materials Laws.

(b) Tenant agrees to protect, defend, indemnify and hold harmless Landlord, its directors, officers, members, partners, shareholders, employees and agents, and any successors and assigns of Landlord from and against any and all liability, including all foreseeable and unforeseeable damages, including but not limited to attorneys’ and consultants’ fees, fines, penalties and civil or criminal damages, the cost of any required or necessary repair, response action, remediation, investigation, cleanup or detoxification and the preparation of any closure or other required plans, directly or indirectly arising out of (i) Tenant’s violation of Section 4.5(a) above or (ii) use, generation, storage, treatment, release, discharge, presence or disposal of Hazardous Material from, on, at, to, or under the Leased Property by Tenant, any Tenant Related Party, or any agent of Tenant or any Tenant Related Party, before or during the Term. This agreement to indemnify and hold harmless shall be in addition to any other obligations or liabilities Tenant may have to Landlord at common law under all statutes and ordinances or otherwise, and shall survive following the date of expiration or earlier termination of this Lease. Tenant expressly agrees that the representations, warranties and covenants made and the indemnities stated in this Lease are not personal to Landlord, and the benefits under this Lease may be assigned to subsequent parties in interest to the chain of title to the Leased Property, which subsequent parties in interest may proceed directly against Tenant to recover pursuant to this Lease.

(c) Tenant shall promptly notify Landlord in writing upon Tenant’s learning of any:

(i) notice or claim to the effect that Tenant is or may be liable to any Person as a result of the presence upon or release or threatened release of any Hazardous Material into the environment from the Leased Property;

(ii) notice that any Property is subject to investigation by any Governmental Authority evaluating whether any remedial action is needed to respond to the release or threatened release of any Hazardous Material into the environment from such Property or any portion thereof;

(iii) notice that the Leased Property or any portion thereof is subject to any environmental lien; and

(iv) notice of violation to Tenant under any applicable Hazardous Material Law that could have a material adverse effect upon the Leased Property or any portion thereof.

4.6 Mold. Tenant shall be responsible for taking all reasonable and timely measures in the ordinary course of business to detect, prevent, and abate the growth of Mold within the Leased Improvements.

ARTICLE 5

MAINTENANCE AND REPAIRS

5.1 Tenant’s General Obligations. Subject to Landlord’s obligations under Section 5.2 below, Tenant shall keep the Leased Property in good operating condition and in good order and repair (whether or not the need for such repairs occurs as a result of Tenant’s use, any prior use, the elements, the age of the Leased Property or any portion thereof) and, subject to Landlord’s election to perform certain work as set forth in Section 5.2(c) , shall promptly make all necessary and appropriate repairs thereto of every kind and nature, whether interior or exterior, structural or non-structural, ordinary or extraordinary, foreseen or unforeseen or arising by reason of a condition existing prior to the commencement of the Term (concealed or otherwise). All repairs, to the extent reasonably achievable, shall be at least equivalent in quality to the original work. All repairs shall be made in a good, workmanlike manner, consistent with industry standards for like properties in like locations, in accordance with all applicable Legal Requirements. Tenant’s obligations under this Section 5.1 shall be limited in the event of any casualty or Condemnation as set forth in Articles 10 and 11 . The cost of all routine maintenance, repairs, and minor alterations which can be expensed under GAAP shall be paid by Tenant, and shall be treated as a component of Operating Expenses.

5.2 Capital Repairs and Replacements.

(a) Landlord agrees to establish and maintain a ledger account (a “ Capital Expenditure Reserve ”) to be used for the purpose of funding the cost of capital repairs, replacements and renewals to the Leased Property necessary to cause the Projects to comply with the standards described in Section 5.1 , including major repairs, alterations, improvements, renewals or replacements to the structure, roof, or exterior façade of the Leased Improvements and to the mechanical, electrical, heating, ventilating, air conditioning, plumbing, and vertical transportation systems of the Leased Improvements (hereinafter referred to as “ Major Repairs ”), as well as routine repairs and replacements of furnishings, fixtures and equipment, including routine repairs and replacements to the mechanical, electrical, heating, ventilating, air conditioning and plumbing systems, and routine maintenance to the Leased Improvements, which are normally capitalized under GAAP (hereinafter referred to as “ Routine Repairs ”). During the Fixed Term, Landlord agrees to allocate annually to the Capital Expenditure Reserve an amount equal to not less than the product of $125.00 times the number of beds within the Leased Improvements (i.e., initially $736,750.00 per annum, based on 5,894 beds). During any Extension Term, the minimum annual amount to be allocated to the Capital Expenditure Reserve shall be adjusted by an amount which reflects any increase or decrease in the Consumer Price Index during the preceding five (5) year period, as calculated in the manner set forth in Section 3.3(a) hereof. In addition, in the event of the termination of this Lease with respect to any individual Property pursuant to the terms of Section 2.4(b) or Article 10 or 11 , the minimum annual allocation to the Capital Expenditure Reserve shall be adjusted to reflect the applicable reduction in the number of beds within the Leased Improvements. Any portion of Capital Expenditure Reserve which is not actually disbursed by Landlord during a Fiscal Year for Approved Capital Expenditures as described below shall remain available to Tenant for use during any subsequent Fiscal Year.

(b) Each year, on or before November 1, Tenant shall prepare and submit to Landlord for its review and approval a budget (the “ Capital Expenditure Budget ”) for both Routine Repairs and Major Repairs which Tenant believes are necessary or desirable to be made with respect to each of the Properties during the ensuing Fiscal Year (presented on both an annual and monthly basis) in order to maintain the Projects in the condition required by Section 5.1 above. In the event that such Capital Expenditure Budget includes any Major Repairs, Tenant shall be entitled to include a reasonable construction supervision fee for itself in such Capital Expenditure Budget with respect to such Major Repairs. Landlord’s approval of such proposed Capital Expenditure Budget shall not be unreasonably withheld or delayed. In the event Landlord shall fail to respond within fifteen (15) days after receipt of a proposed Capital Expenditure Budget, then such Capital Expenditure Budget shall be deemed approved by Landlord. All Capital Expenditures proposed by Tenant shall be (as to both the amount of each such expenditure and the timing thereof) both reasonable and necessary, given the objective that each Project will be maintained and operated to a standard comparable to competitive apartment complexes and in good order and repair. Tenant agrees to incorporate all reasonable revisions to any proposed Capital Expenditures Budget which are required by Landlord. Upon approval of a proposed Capital Expenditure Budget by Landlord, Landlord shall submit such Capital Expenditure Budget to any Project Mortgagee (including the Existing Lender) which may have the right to review and approve such budget. Landlord shall be responsible for obtaining approval of any such Capital Expenditure Budget by any such Project Mortgagee. The Capital Expenditure Budget for the remainder of calendar year 2005 has previously been approved by Landlord, Tenant, and the Existing Lender and is attached hereto as Exhibit D and by this reference made a part hereof.

(c) Tenant shall, consistent with the Capital Expenditure Budgets approved by Landlord and, if applicable, any Project Mortgagee, from time to time make Routine Repairs and Major Repairs to the Leased Property, except to the extent that in the case of a Major Repair, Landlord elects to be responsible for the performance of such work. Tenant shall not materially deviate from any Capital Expenditure Budget approved by Landlord or any Project Mortgagee (including the Existing Lender) without the prior approval of Landlord, except in the case of emergency where immediate action is necessary to prevent imminent danger to person or property or to comply with any applicable Legal Requirements.

(d) The cost of all Capital Expenditures incurred pursuant to an approved Capital Expenditure Budget or otherwise approved or authorized pursuant to subsection (c) above (“Approved Capital Expenditures”) shall be funded by Landlord. In the event the existing amount allocated to the Capital Expenditure Reserve plus the minimum amounts to be allocated thereto for the Fiscal Year of the approved Capital Expenditure Budget are not sufficient to fully fund all such Approved Capital Expenditures for any Fiscal Year, Landlord shall increase the amount allocated to the Capital Expenditure Reserve for such Fiscal Year in order to fully fund the approved Capital Expenditure Budget. Upon Tenant’s written request for disbursement, Landlord shall disburse funds to or for the account of Tenant, to pay for or to reimburse Tenant for such Approved Capital Expenditures, upon satisfaction of the conditions set forth in Section 5.3 .

(e) Landlord shall not be obligated to fund the costs of Capital Expenditures in excess of amounts included from time to time in the approved Capital Expenditure Budget for any Fiscal Year unless such Capital Expenditures are expressly approved in advance by Landlord or unless such expenditures are incurred by Tenant in an emergency situation where immediate action is necessary to prevent imminent danger to person or property or to comply with any applicable Legal Requirements. Tenant shall not make any capital replacements, repairs or alterations to the Leased Property without Landlord’s prior written consent unless such replacement, repair or alteration is made pursuant to an approved Capital Expenditure Budget or is required in order to prevent imminent danger to person or property or to comply with any applicable Legal Requirements.

5.3 Conditions to Capital Expenditure Reimbursements. Upon Tenant’s request, Landlord shall pay for or reimburse Tenant for Approved Capital Expenditures incurred by Tenant upon satisfaction of each of the conditions set forth below (provided that nothing herein shall require Tenant to advance any funds for Major Repairs):

(a) Except as provided in this Section 5.3 , each request for funds shall be made only after completion of the capital repairs, replacements or alterations (the “Work”) for which disbursement is requested.

(b) If the contractor performing such Work requires periodic payments pursuant to the terms of a written contract, a request for funds may be made after completion of a portion of the work under such contract, provided (v) such contract requires payment upon completion of such portion of the work, (w) the materials for which the request is made are on site at the applicable individual Project and are properly secured or have been installed in the applicable individual Project, (x) all other conditions in this Section 5.3 for disbursement have been satisfied and (y) if required by Landlord, each contractor or subcontractor receiving payments under such contract shall provide a waiver of lien with respect to amounts which have been paid to that contractor or subcontractor.

(c) Each disbursement of funds, except for a final disbursement, shall be in the amount of actual costs incurred for completed Work (as certified by an approved architect, if applicable), less a retainage equal to ten percent (10%) of such costs incurred in the case of projects having a cost in excess of $50,000, until such Work has been completed. The retainage shall in no event be less than the percentage of such costs that the contract with the relevant contractor or supplier specifies to be retained and advanced as part of the final disbursement. No funds will be advanced for materials stored at any individual Project unless such materials are properly stored and secured at such individual Project in accordance with sound construction practices as reasonably determined by Landlord. The retainage shall not be released until the Tenant or, if applicable, an approved architect certifies to Landlord that the Work has been completed substantially in accordance with the provisions of this Section 5.3 and that all material approvals necessary at such individual Project have been obtained from all appropriate Governmental Authorities, and Landlord receives evidence reasonably satisfactory to Landlord that the costs of the Work have been paid in full or will be paid in full out of the retainage.

(d) The amount of all invoices in connection with the Work with respect to which a disbursement is requested and which has been approved by Landlord shall be disbursed by Landlord either directly to the Tenant (in which event, such Tenant covenants and agrees to promptly pay such invoices) or, if an Event of Default has occurred and is continuing, at Landlord’s option and in Landlord’s sole and absolute discretion, directly to the contractor, supplier, materialman, mechanic or subcontractor indicated on said invoices unless already paid by Tenant and Landlord has received satisfactory evidence of such payment in which case Landlord shall reimburse Tenant. In the event that Tenant requests that any amounts be disbursed directly to Tenant pursuant to the foregoing sentence, Tenant shall be required to deliver evidence reasonably acceptable to Landlord of payment of all invoices for which disbursements were previously made to Tenant as a condition to such requested disbursement.

(e) No more than one disbursement per Property will be made by Landlord in any calendar month.

(f) Except to the extent such item is already contained in an approved Capital Expenditure Budget, Landlord reserves the right, at its option and as a condition to the funding of any Capital Expenditures, to approve (1) all drawings and plans and specifications, if any, for any Work which requires aggregate payments in amounts exceeding $50,000, and (2) all contracts and work orders with materialmen, mechanics, suppliers, subcontractors, contractors and other parties providing labor or materials in connection with any Work which requires aggregate payments in amounts exceeding $50,000. Any such approval shall not be unreasonably withheld, conditioned or delayed and shall be deemed given if Landlord fails to respond within fifteen (15) Business Days after Landlord receives all information reasonably required to adequately review such drawings, plans and specifications, contracts or work orders.

(g) For any Work which requires aggregate payments in amounts exceeding $50,000 or is structural in nature or relates to the life safety systems at any individual Project, Landlord may require an inspection of such individual Project prior to making a monthly disbursement in order to verify completion of the Work for which disbursement is sought. Landlord may require that such inspection be conducted by an appropriate independent qualified architect or engineer selected by Landlord and/or may require a copy of a certificate of completion by an independent qualified architect or engineer licensed in the state where the applicable individual Project is located and otherwise acceptable to Landlord prior to funding the cost of such Work.

5.4 Additional Provisions Relating to Capital Repairs and Replacements.

(a) In the event Landlord determines in its reasonable discretion that any Work being performed by or under the supervision of Tenant is not being performed in a workmanlike or timely manner or that any such Work has not been completed in a workmanlike manner, Landlord shall have the option to withhold disbursement for such unsatisfactory Work and so notify Tenant with reasonable detail regarding the basis for Landlord’s dissatisfaction and, after the expiration of thirty (30) days from the giving of such Notice by Landlord to Tenant of such unsatisfactory Work without the cure thereof (or, if such unsatisfactory Work is susceptible of a cure but cannot reasonably be cured within said thirty (30) day period and provided that Tenant shall have commenced to cure such unsatisfactory Work within said thirty (30) day period and thereafter diligently and expeditiously proceeds to cure the same, after the expiration of such longer period as is reasonably necessary for Tenant in the exercise of due diligence to cure such unsatisfactory Work, up to a maximum of an additional sixty (60) days, without the cure thereof), Landlord may proceed under existing contracts or contract with third parties to complete such Work, as the case may be, and apply a portion of the Capital Expenditure Reserve toward the labor and materials necessary to complete the same, without providing any additional prior Notice to Tenant, and exercise any and all other remedies available to Landlord upon and during the continuance of an Event of Default hereunder. Any dispute between Landlord and Tenant under this Section 5.4(a) shall be subject to arbitration in accordance with Article 25 below at the request of either party.

(b) Tenant shall permit Landlord, any Project Mortgagee, and their respective agents and representatives (including, without limitation, Landlord or said Project Mortgagee’s engineer, architect or inspector) or third parties performing any Work on behalf of Landlord pursuant to this Section 5.4 or otherwise to enter onto any individual Property during normal business hours upon reasonable prior notice (subject to the rights of subtenants under their leases) to inspect the progress of any Work and all materials being used in connection therewith, to examine all plans and shop drawings relating thereto which are or may be kept at the Property, and to complete any Work as permitted under this Section 5.4. Tenant shall cause all of its contractors and subcontractors to cooperate with Landlord or Landlord’s representatives or such other persons described above in connection with inspections described in this Section 5.4(b) or the completion of the Work pursuant to Section 5.4(a) . In the event Landlord elects to perform or be responsible for the performance of any Major Repairs to any Property, Landlord (i) shall perform such work in a good and workmanlike manner, consistent with industry standards for like properties in like locations, in accordance with all applicable Legal Requirements, (ii) shall coordinate the scheduling of such Work with Tenant, (iii) shall use its best efforts to minimize any interference with Tenant’s operations at such Property in the performance of such Work, and (iv) shall indemnify Tenant from any and all actions, claims, costs, and expenses, including personal injury and property damage, resulting from the negligent actions of Landlord, its agents, contractors, or employees, as well as from Landlord’s failure to perform such Work in accordance with the requirements of (i) and (iii) above.

(c) All Work and all materials, equipment, fixtures and any other items comprising a part thereof shall be constructed, installed or completed by Landlord or Tenant, as applicable, free and clear of all mechanic’s, materialman’s or other liens (subject, in the case of any such Work performed by Tenant, to Landlord’s obligation to fund the cost of such Work in accordance with Sections 5.2 and 5.3 .

ARTICLE 6

INTENTIONALLY OMITTED

ARTICLE 7

LIENS

Subject to the provisions of Article 8 relating to permitted contests, Tenant will not directly or indirectly create and will promptly discharge any lien, encumbrance, attachment, title retention agreement or claim upon the Leased Property, or any part thereof or upon Tenant’s leasehold estate hereunder, that arises from the use or occupancy of the Leased Property by Tenant or, subject to Landlord’s funding of Approved Capital Expenditures pursuant to Section 5.2, by reason of any labor, service or material furnished or claimed to have been furnished to or for the benefit of Tenant or by reason of any construction or repairs by or at the direction of Tenant of all or any part of the Leased Improvements. Nothing herein shall obligate Tenant to discharge (a) restrictions, liens and other encumbrances which are consented to in writing by Landlord, (b) liens for those taxes of Landlord which Tenant is not required to pay hereunder, (c) liens for Impositions or for sums resulting from noncompliance with Legal Requirements so long as (1) the same are not yet payable or are payable without the addition of any fine or penalty or (2) such liens are in the process of being contested as permitted by Article 8 , (d) liens of mechanics, laborers, materialmen, suppliers or vendors engaged by Tenant for sums either disputed or not yet due, provided that (1) the payment of such sums shall not be postponed for more than sixty (60) days after the completion of the action giving rise to such lien and such reserve or other appropriate provisions as shall be required by law or GAAP shall have been made therefor or (2) any such liens are in the process of being contested as permitted by Article 8 , (e) liens of mechanics, laborers, materialmen, suppliers or vendors engaged by Landlord, and (f) any liens which are the responsibility of Landlord pursuant to the provisions of Article 15 of this Lease. Unless otherwise expressly provided herein, Tenant shall not mortgage or grant any interest in, or otherwise assign, any part of the Tenant’s rights and interests in this Lease, the Leased Property or any permits, licenses, or any other approvals required to operate the Leased Property during the Term without the prior written consent of the Landlord, which may be withheld at Landlord’s sole discretion.

ARTICLE 8

PERMITTED CONTESTS

Tenant shall have the right to contest the amount or validity of any Imposition, Legal Requirement, Insurance Requirement, lien, attachment, levy, encumbrance, charge or claim (collectively, “ Claims ”) as to the Leased Property, by appropriate legal proceedings conducted in good faith and with due diligence, provided that (a) Tenant shall give Landlord prior written notice of each such contest, (b) the foregoing shall in no way be construed as relieving, modifying or extending Tenant’s obligation to pay any Claims which are Tenant’s obligations as finally determined, (c) such contest shall be permitted under any Project Mortgage encumbering the affected Property, and any conditions or requirements of any applicable Project Mortgagee shall be satisfied, (d) no part of the Leased Property nor any Rent therefrom shall be in any immediate danger of sale, forfeiture, attachment or loss, and (e) Tenant shall indemnify and hold harmless Landlord from and against any cost, claim, damage, penalty or reasonable expense, including reasonable attorneys’ fees, incurred by Landlord in connection therewith or as a result of Tenant’s exercise of its rights under this Article 8 . Any compromise or settlement of any such contest shall be subject to the prior written approval of Landlord, which approval shall not be unreasonably withheld, delayed or conditioned. Landlord agrees to join in any such proceedings if required legally to prosecute such contest, provided that Landlord shall not thereby be subjected to any liability therefor (including, without limitation, for the payment of any costs or expenses in connection therewith) unless Tenant agrees, by agreement in form and substance reasonably satisfactory to Landlord, to assume and indemnify Landlord with respect to the same. Tenant shall be entitled to any refund of any Claims and such charges and penalties or interest thereon which have been paid by Tenant or paid by Landlord to the extent that Landlord has been fully reimbursed by Tenant. If Tenant shall fail (x) to pay or cause to be paid any Claims which are Tenant’s obligation when finally determined, (y) to provide reasonable security therefor, or (z) to prosecute or cause to be prosecuted any such contest diligently and in good faith, Landlord may, upon reasonable notice to Tenant (which notice shall not be required if Landlord shall reasonably determine that the same is not practicable), pay such charges, together with interest and penalties due with respect thereto, and Tenant shall reimburse Landlord therefore, upon demand, as Additional Charges.

ARTICLE 9

INSURANCE

9.1 General Insurance Requirements. During the Term, Tenant shall at all times keep the Leased Property insured against loss or damage from such causes as are customarily insured against by prudent owners of similar facilities, including the insurance described below. All insurance shall be written by insurance companies (i) that have a claims paying ability rating by Standard & Poor’s Rating Services of not less than “BBB,” by Moody’s Investors Services, Inc. of not less than “BA3,” and by Fitch, Inc. of not less than “AA,” an A.M. Best Company, Inc. rating of not less than A- and a financial size category of not less than X, or such higher ratings as may be required by any Project Mortgagee, including Existing Lender with respect to the Properties which are subject to the Existing