UCD West Village Student Housing Cluster 1 Lease

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STUDENT HOUSING SUB-PHASE LEASE {CLUSTER 1)

THE REGENTS OF THE UNIVERSITY OF CALIFORNIA a California public corporation on bebalfofthe Davis Campus

("University")

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WVCP CLUSTER 1, LLC, a Delaware limited liability company

("Lessee")

July li" 2010

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TABLE OF CONTENTS

Page

ARTICLE I DEFINITIONS ....................................................................... .......................... 1

Section 1.1 Defmitions ............................................................................................ ]

ARTICLE II GRANT, TERM AND CONDITION ............................................................ 21

Section 2.1 Section 2.2 Section 2.3 Section 2.4

Lease ................................................................................................... 21 Reserved ............................................................................................. 22 Term ................................................................................................... 22 Condition of Leased Land .................................................................. 22

ARTICLE III GUARANTY AND FINANCIAL COVENANTS ........................................ 26


Guaranty ............................................................................................. 26 Financial Conditions ........................................................................... 27 University'S Audit Right .................................................................... 27 Joint Financing Guaranty ................................................................... 27

ARTICLE IV PERMmED USE ......................................................................................... 28

Section 4.1 Section 4.2 Section 4.3 Section 4.4 Section 4.5 Section 4.6 Section 4.7 Section 4.8

Use of Leased Land ............................................................................ 28 Construction Staging .......................................................................... 28 Waste; Nuisance ........................................................................... , ..... 28 Hazardous Substances ........................................................................ 28 Compliance With Applicable Laws .................................................... 33 Right to Contest .................................................................................. 33 Advertising and Signs ............... ; ......................................................... 34 University's Reserved Uses ................................................................ 35

ARTICLE V CONSTRUCTION AND IMPROVEMENT OF LEASED LAND ............... 39

Section 5.1 Section 5.2 Section 5.3 Section 5.4 Section 5.5 Section 5.6 Section 5.7 Section 5.8 Section 5.9 Section 5.10 Section 5.11 Section 5.12 Section 5.13

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University Infrastructure Improvements ............................................ 39 Project ................................................................................................. 42 Design Implementation Group ........................................................... 43 Plan Review and Permitting Process ................................................. .44 Compliance with Applicable Laws .................................................... .44 Mitigation Measures ....................................... : ................................... 45 Lessee's Contractors ........................................................................... 46 Utilities and Other Facilities .............................................................. .47 University Inspections ........................................................................ 48 As-Built Plans ..................................................................................... 50 Ownership of BUildings ...................................................................... 50 Maintenance of Leased Land and Project... ........................................ 50 Pre-Conditions to Commencing Work ............................................... 50

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TABLE OF CONTENTS (CONTINUED)

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ARTICLE VI MISCELLANEOUS OPERATIONS ITEMS ................................................ 53

Section 6.1 Section 6.2 Section 6.3 Section 6.4 Section 6.5

Capital Reserves ................................................................................. 53 Additional Maintenance Obligations .................................................. 53 Commercial Subleasing ...................................................................... 54 Reserved ............................................................................................. 54 Priority To Student Occupancy Of Student Beds ............................... 54

ARTICLE VII LEASE CONSIDERATION .......................................................................... 54


Section 7.5 Section 7.6

Basic Rent .. ",', ............................. , ...................................................... 54 Municipal Fees Amount ..................................................................... 55 Inspection Fees ................................................................................... 56 FF&E, Development Documents and Development Agreements ......................................................................................... 56 Other Payments .................................................................................. 57 Net Lease .......... : ................................................................................. 57

ARTICLE VIII TAXES AND ASSESSMENTS ..................................................................... 58

Section 8.1 Section 8.2 Section 8.3 Section' 8.4 Section 8.5

Taxes and Assessments ....................................................................... 58 Liens and Delinquencies ..................................................................... 58 Lessee's Right to Contest ................................................................... 58 Replacement Taxes ............................................................................. 59 Survival ............................................................................................... 59

ARTICLE IX INSURANCE ................................................................................................. 59


Section 9.3

Section 9.4 Section 9.5 Section 9.6 Section 9.7 Section 9.8 Section 9.9 Section 9.10 Section 9.11 Section 9.12 Section 9.l3

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Property Insurance .............................................................................. 59 Liability Insurance--Lessee and Lessee's Contractor and Subcontractors .................................................................................... 60 Liability Insurance - Consultants including Lessee's Architect and Lessee's Engineer ........................................................................ 62 Periodic Increases ............................................................................... 63 Additional Insureds ............................................................................ 63 Lessee Not Relieved ........................................................................... 64 Proof of Insurance .............................................................................. 64. Proceeds .............................................................................................. 64 Waiver of Subrogation Rights ............................................................ 65 Compliance with Requirements of Carriers ....................................... 65 Non-Contributing ................................................................................ 65 Form of Policies ................................................................................. 65 Settlement of Claims .......................................................................... 65

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ARTICLE X DAMAGE OR DESTRUCTION ............................. ...................................... 66

Section 10.1 Section 10.2 Section 10.3

Minor Damage or Destruction ............................................................ 66 Major Damage or Destruction ....... .............................. ....................... 66 Basic Rent Abatement ........................................................................ 68

ARTICLE XI CONDEMNATION ................................................. : ..................................... 68

Section 11.1 Section 11.2 Section 11.3 Section 11.4 Section 11.5 Section 11.6

Lease Governs ............................................................................ ........ 68 Total Taking; Termination; Distribution of Award ............................ 69 Partial Taking; Effect; Restoration; Distribution of Award ............... 70 Temporary Taking; Effect; Distribution of Award ............................. 71 Notice ................................................................................................. 72 Covenant Barring Condemnation ....................................................... 72

ARTICLE XII ASSIGNMENT, SUBLEITING AND PURCHASE RIGHTS ..................... 72


Assignment And Subletting ....................................................... ......... 72 Right of First Offer ............................................................................. 73 Right of First Refusal ......................................................................... 74 University Purchase Procedures ......................................................... 75

ARTICLE XIII INDEMNITY, CLAIMS, LIENS AND ENCUMBRANCES ....................... 76


Lessee Indemnity ...... ~ ..................... ! .................. ...................................... 76 University Indemnity .................................... , ................. ' ...................... 76 Cov~nant Against Encumbrances ....................................................... 77 Mechanics" an.d Similar Liens .. ~ .................... ! •••• _ ................. ,.i ... ~ .. " •.... 78 Relationship to Article XVI ................................................................ 78 SurvivaL .............................................................................................. 78

ARTICLE XIV HOLDING OVER, SURRENDER, OWNERSHIP OF PROJECT .............. 78

Section 14.1 Section 14.2 Section 14.3 Section 14.4 Section 14.5

Holding Over ...................................................................................... 78 Surrender of Leased Land ................................................................... 79 Abandoned Property ........................................................................... 80 Relocation ........................................................................................... 80 Survival. .............................................................................................. 80

ARTICLE XV DEFAULT ...................................................................................................... 80

Section 15.1 Section 15.2 Section 15.3

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Default by Lessee ............................................................................... 80 Default by University ............... ................................... '" ............ .. ...... 82 Remedies of University ...................................................................... 82

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Remedies of Lessee ............................................................................ 84 Failure of Lessee to Perform Required Acts ...................................... 85

ARTICLE XVI FINANCING .................................................................................................. 85

Section 16.1 Section 16.2 Section 16.3 Section 16.4 Section 16.5 Section 16.6 Section 16.7 Section 16.8 Section 16.9 Section 16.10 Section 16.11 Section 16.12

Controlling Provisions ........................................................................ 85 Financing ............................................................................................ 85 Transfer ............................................................................................... 88 Notice to Leasehold Mortgagee .......................................................... 91 Request for Notice of Defaults ........................................................... 91 Leasehold Mortgagee's Cure Rights .................................................. 91 New Lease .......................................................................................... 93 Merger ................................................................................................ 94 No Modification, Etc .......................................................................... 94 Limitation on Leasehold Mortgagee Liability .................................... 94 Conflict ............................................................................................... 94 Leasehold Mortgagee Third Party Beneficiary ........ .......................... 95

ARTICLE XVII ECONOMIC INFEASIBILITY ..................................................................... 95


Certain Hazardous Substances ............................................................ 95 Master Lease Termination Event ........................................................ 96 Reserved ............................................................................................. 97 Certain Increased Costs ...................................................................... 97 Historical Resource or Unique Archaeological Resource .................. 99 Termination ........................................................................................ 99

ARTICLE XVIII QUIET ENJOYMENT .................................................................................. 100

ARTICLE XIX EQUAL OPPORTUNIlY ............................................................................ 101


Lessee's Obligations ......................................................................... I 01 University'S Right and Remedies ..................................................... 101

ARTICLE XX RESERVED ................................................................................................. 101

Section 20.1 Reserved ........................................................................................... 1 0 1

ARTICLE XXI MISCELLANEOUS ..................................................................................... 1 0 1


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Notices .................................................................................. , ........... 101 Brokerage Commissions ................................................................... 1 03 Nonmerger of Fee and Leasehold Estates ........................................ 103 Entry of Leased Land by University ................................................. 103

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Section 21. 5 Section 21.6 Section 21.7 Section 21.8 Section 21.9 Section 21.10 Section 21.11 Section 21.12 Section 21.13 Section 21.14 Section 21.15 Section 21.16 Section 21.17 Section 21.18 Section 21.19 Section 21.20 Section 21.21 Section 21.22

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Force Majeure Delay ........................................................................ 1 04 Time of the Essence .......................................................................... 104 Waiver .............................................................................................. 104 Captions ............................................................................................. 104 Governing Law ................................................................................. 104 Entire Agreement .............................................................................. 1 04 Righ~ to Request Injunction .............................................................. 105 Severability ....................................................................................... 105 Interest Rate to be Paid .......... : .......................................................... 105 Representations and Warranties by Lessee ..................................... .1 05 Representations and Warranties by University ................................ 106 Relationship of Parties ...................................................................... 1 06 Attorneys' Fees and Costs ................................................................ 1 06 Survival of Covenants ...................................................................... 107 Binding Effect .................................................................................. 107 Execution in Counterparts ................................................................ 1 07 Memorandum of Lease ..................................................................... 107 Press Releases ................................................................................... 107

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Exhibit A-I:

Exhibit A-2:

Exhibit A-3:

ExhibitB:

ExhibiJC:

ExhibitD:

ExhibitE:

Exhibit F-l:

Exhibit F-2:

Exhibit F-3:

Exhibit G:

ExhibitH:

Exhibit I:

ExhibitJ:

ExhibitK:

ExhibitL:

ExhibltM:

ExhlbilN:

Exhibit 0:

ExhibitP:

ExhibitQ:

ExhibltR:

ExhibitS:

Exhibit T:

Exhibit U:

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TABLE OF EXHIBITS

Subdivision Map

Description of Leased Land Area

Description of Land Uses

Property Management Standards

Additional Maintenance and Repair Obligations

Summary of Permit and Inspection Process

Form of Guaranty

RESERVED

Form of Joint Financing Guaranty

Form of Performance Guaranty

West Village Implementation Plan

List of Certain University Regulations

Delegated Punch List Work

RESERVED

Description of University Infrastructure Improvements

RESERVED

List of Mitigation Responsibilities

List of Lessee Consultants

Form of Financing Statement

Form of Assignment and Consent

Form of Memorandum of Lease

Permitting, Approvals and Inspection Fees

Design Implementation Group Procedures

RESERVED

Development Standards

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TABLE OF EXHIBITS ) (continued)

Exhibit V: Termination Fee Payment

Exhibit W-l: RESERVED

Exhibit X: University Infrastructure Required Capacity

Exhibit Y: Commercial Sublease Restrictions

ExhibltZ: Student Bed Sublease Offering Procedures

ExhibilM: Signage Guidelines

ExhibitBB: Initial Utility Costs

ExhlbitCC: Municipal Fees Amount

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STUDENT HOUSING SUB-PHASE LEASE (CLUSTER 1)

TIllS STUDENT HOUSING SUB-PHASE LEASE (this ''Lease'') is made and entered into as ofthis __ day of July, 2010 (the "Effective Date") by and between THE REGENTS OF THE UNIVERSITY OF CALIFORNIA, a California public corporation on behalf of the Davis Campus (''University''), and WVCP CLUSTER 1, LLC, a Delaware limited liability company ("Lessee").

RECITALS

A. University is the owner in fee simple of the approximately one hundred thirty (130) acre parcel of land (herein, the ''Master Project Leased Land"), which is generally depicted on Exhibit A-I attached hereto, upon which the Master Project (as defined below) may be constructed.

B. The Master Project Leased Land has been subdivided into a series of separate legal parcels (each herein a "Lot" and collectively, the ''Lots'') as depicted upon that certain Amended Map Subdivision Map No. 4947, dated March 2010, prepared by Cunningham Engineering and recorded as Book 2010 of Maps, pages 32 through 53, on May 14,2010, in the Official Records of the CouQty Recorder of the County ofVolo, State of California (herein, the "Subdivision Map':), a copy of which is attached hereto as Exhibit A-I.

C. Subject to the terms and conditions herein, University is willing to lease to Lessee, and Lessee is willing to lease from University, the portion of the Master Project Leased Land comprising Lots M, N, 0 and P as shown on Exhibit A-I (each a "Commercial Lot" and collectively, the "Leased Land',), which Commercial Lots are generally depicted upon Exhibit A-2 attached hereto, for the purpose of constructing and operating the Project (as defined below).

NOW, THEREFORE, in consideration of the foregoing, the mutual covenants herein contained, and for other good and valuable consideration, receipt and sufficiency of which is hereby acknowledged, and upon and subject to the terms an" conditions herein contained, the parties hereto agree as follows:

apply:

ARTICLE I DEFINITIONS

Section 1.1 Definitions. For purposes of this Lease, the following definitions shall

"Abatement Event" shall have the meaning set forth in Section 5.1(i) of this Lease

"Atteptance Notice" shall have the meaning set forth in Section 12.2(c) of this Lease.

"Attess Areas" shall have the meaning set forth in Section 2.1 of this Lease.

"Adjustment Date" shall mean January 1 st of each year.

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"Affiliate" shall mean an entity with respect to which WVCP or a Control Entity has the sole power to make all day-to-day management decisions with respect to performance of such party's obligations under this Lease and in which WVCP or a Control Entity has at least a twenty percent (20%) direct or indirect ownership interest. An "Affiliate" shall include, without limitation, a limited liability company of which WVCP or a Control Entity is managing member or a limited partnership of which WVCP or a Control Entity is the general partner, and in which, in each case, WVCP or a Control Entity has the ownership interest referred to in the immediately preceding sentence. For purposes hereof, a "Control Entity" is an entity controlled and at least ninety percent (90%) owned, directly or indirectly, by either (i) a combination ofCP Investment Fund II, L.P., a Delaware limited partnership and Urban Villages, Inc., a Colorado corporation, or (ii) CP Investment Fund II, L.P., a Delaware limited partnership, individually.

"Anticipated Demolition Costs" shall have the meaning set forth in Section 14.2(b) of this Lease.

"Apartment" shall mean a separate residential living unit, provided that where a collectiofi of up to six (6) Student Beds are accessed from a common entry and share a common living and kitchen area, such collection of Student Beds shall count as a single Apartment.

"Applicable Laws" shall mean (i) as applied to the Lessee Parties, the Sub-Phase Lessee Parties, the Occupants {and their guests ,and invitees) and Guarantor, the federal, state and local statutes, regulations, rules, ordinances, and all other governmental requirements applicable to the Project and the Delegated Punch List Work, Lessee's Interest and any activity of any such party undertaken pursuant to this Lease, excluding the Entitlements Documents and the University Regulations; and (ii) as applied to the University and the University Parties, the federal, state and locai statutes, regulations, rules, ordinances, and all other governmental requirements (including orders of court) applicable to any activity of any University Party undertaken pursuant to this Lease, excluding the Entitlements Documents and the University Regulations.

"Assessments" shall mean any and all possessory use or interest taxes and assessments or levies or charges assessed or imposed against the Leased Land and/or the Project made by any municipal government or political subdivision for local improvements or any other governmental agency (including, without ]imitation, all County fees and all Davis School District fees); provided, however, that "Assessments" shall not include either the Municipal Fees Amount (Construction Phase) or the Municipal Fees Amount imposed, created or adopted by University.

"Available Terms" shall have the meaning set forth in Section 12.3(a) of this Lease.

"Assumed RFA" shall have the meaning set forth in Section 2.4(1) of this Lease

"Basic Rent Adjustment Date" shall mean the date which is the tenth (10th) anniversary of the Basic Rent Commencement Date.

"Basic Rent Commencement Date" shall mean the date which is the later of (i) the Effective Date, and (ii) the University Infrastructure Completion Date.

"Building" shall mean each individual commercial/residential building comprising a portion of the Project.

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"Business Days" shall mean Monday through Friday, except holidays; "holiday" shall mean those holidays specified by the laws of the United States or the State of California and all holidays to which employees of the University are entitled from time to time.

"Campus" shall mean any facility owned, operated or occupied by University of California, Davis campus together with all associated unimproved land and access routes.

Lease.

"Capital Expenditures" shall have the meaning set forth in Section 6.1 of this Lease.

"Capital Reserve Aeeounf' shall have the meaning set forth in Se~tion 6.1 of this Lease.

"Capital Reserve Threshold" shall have the meaning set forth in Section 6.1 of this

"Casualty Abatement Period" shall have the meaning set forth in Section 10.3 of this Lease.

"Certificate of Occupancy" shall mean a written notice issued by the University Inspectors with respect to any Building, or applicable portion thereof, in accordance with Section 5.9 and Exhibit D, certifying that such Building, or applicable portion thereof, is complete (with conditions) and ready for occupancy.

"Certified Preliminary Plans" shall mean Preliminary Plans that have been approved by the University or determined to not require University approval in accordance with the provisions in Section 5.3 and Exhibit S attached hereto.

"Claims" shall mean any and all claims, suits, causes of action, demands, losses, damages, diminution of property value, liabilities, fines, penalties, costs, taxes, charges, administrative and judicial proceedings, orders, judgments, remedial actions and compliance requirements, including, without limitation, enforcement and clean-up actions, third-party tort and property claims, natural resource damages and other expenses (including, without limitation, attorneys' and consultants' and experts' fees and costs of defense).

"CLC" shall mean the California Labor Code.

"Closing" shall have the meaning set forth in Section 12.4 of this Lease.

"Commencement of Construction Date" shall mean the date upon which (i) University issues a pennit for any portion of the Work, including, without limitation, any grading Work to be completed upon any portion of the Initial Leased Land, and (ii) Lessee has commenced any portion of the Work.

"Commercial Lot" shall have the meaning set forth in Recital C of this Lease.

"Commercial Sublease" shall mean a sublease of any portion ofthe office/retail components of the Mixed-Use Area, including any University Sublease related to office/retail components of the Mixed-Use Area, having a term which does not extend beyond the Term Expiration Date and otherwise cOmplying with the requirements of Section 6.3 of this Lease.

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"Completion" shall mean, (i) with respect to the Delegated Punch List Work, the issuance by University of a Letter of Completion with respect to all Delegated Punch List Work, (ii) with respect to each Building, the issuance ofa Certificate of Occupancy with respect to such Building pursuant to Exhibit D, and (iii) with respect to each of the Joint Financing Buildings (other than the Buildings under this Lease), the issuance of a Certificate of Occupancy with respect to each such Joint Financing Building in accordance with the respective Student Housing Sub-Phase Lease governing the-development, use and occupancy of such Joint Financing Building.

"Completion Net Worth" shall have the meaning set forth in Section 16.3 of this lease.

"Completion of the Joint Financing Projects" shall mean the issuance by University of a Letter of Completion with respect to all Delegated Punch List Work with respect to each of the Joint Financing Projects, and the issuance by University ofa Certificate of Occupancy with respect to the final Joint Financing Building which is to be constructed as a portion of the Joint Financing Projects.

"Completion ofthe Projecf' shall mean the issuance by University of a Letter of Completion with respect to all Delegated Punch List Work, and the issuance by University of a Certificate of Occupancy with respect to the final Building which is to be constructed as a portion of the Project.

"Construction Contract" shall mean that certain guaranteed maximum price contract between Lessee and Lessee's Contractor, reviewed and approved-by the University pursuant to Section S.7 of this Lease.

"Construction Commencement" shall mean the date on which (i) all applicable Governmental Authorizations and University Authorizations required to be obtained to permit the commencement ofthe Work with respect to an individual Building have been obtained, and (ii) Lessee has commenced the Work with respect to such Building, including, without limitation, authorized Lessee's Contractor to proceed with the Work with respect to such Building.

"County" shall mean the County of Yolo, State of California.

"CPI Index" shall mean the Consumer Price Index - All Urban Consumers, for the San Francisco-Oakland-San Jose Area, reflecting All Items, published by the Bureau of Labor Statistics of the United States Department of Labor (1982-84=100). If the base year of the CPI Index is chan~~d, then the calculation hereunder shall be made utilizing the appropriate conversion factor published by the Bureau of Labor Statistics (or successor agency) to reflect the base year of the CPI Index herein specified. If no such conversion factor is published, then the parties shall, if possible, make the necessary calculation to achieve such conversion. If such calculation is not possible, or if publication of the CPI Index is discontinued, or if the basis of calculating the CPI Index is materially changed, the term "CPI Index" shall mean comparable statistics on the cost of living as computed by an agency of the United States Government performing a function similar to the BUreau of Labor Statistics, or, ifnone, by a substantial and

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responsible periodical or publication of recognized authority most closely approximating the result which would have been obtained using the CPI Index.

"Current Dollars" shall mean a specified dollar amount stated herein multiplied by a fraction the numerator of which is the CPI Index last published prior to the Adjustment Date applicable to the year in which the subject dollar amount is being measured, and the denominator of which is the CPI Index last published prior to February 1,2007.

"Debt Service Coverage Ratio" shall mean the Net Operating Income for the Project divided by an amount equal to the aggregate amount of interest and principal which will be payable under all Project Financing which is proposed to be in place foHowing any such refinancing, collectively, during the twelve (1-2) full calendar month period following the date of such measurement; provided, however, (a) for the purpose of calculating "Net Operating Income" utilized in computing the "Debt Service Coverage Ratio", the Net Operating Income shall be computed using the actual rents reflected within the most recent monthly rent roll for the Project multiplied by twelve (12) to extrapolate to an annual rental stream, and using a Project expense factor computed based upon the actual expenses for the twelve (12) full calendar month period preceding the date of such measurement, and (b) for the purpose of calculating "Debt Service Coverage Ratio" with respect to the initial refinancing of the construction loan following Completion of the Project, the Net Operating Income will be computed assuming ninety-six percent (96%) occupancy of the Buildings at the initial rental amount being charged to Occupants pursuant to Lessee's marketing materials and operating budget for the Project.

"Deed of Trust" shall have the meaning set forth in Section 16.2 of this Lease.

"Delegated Punch List Work" shall mean the work, if any, outlined in a Certificate of Substantial Completion issued to WVCP (whether prior to or after the Effective Date) with respect to any Delivered Infrastructure which is to be completed by Lessee (for example, landscaping and lighting), as generally described in Exhibit 1 attached hereto.

"Delivered Infrastructure" shall mean the Infrastructure Improvements which have become "Delivered Infrastructure" as defined in and determined pursuant to the Master Lease.

"Demolish(ed)" or "Demolition" shall mean demolition of portions of the Project, removal of all debris resulting therefrom, and restoration of the Leased Land to a condition specified by the University, but which shall not be a better condition than the Leased Land was in prior to the Effective Date.

"Demolition Reserve Accounf' shall have the meaning set forth in Section 14.2(b) of this Lease.

"Design Standards" shall mean collectively (i) the requirements set forth within the Implementation Plan, (ii) the Development Standards, and (iii) the Design Review Criteria adopted by the DIG, as amended from time to time.

"Development Agreements" shall mean collectively, the agreements between Lessee and Lessee's Contractor pertaining to development of the Project, the agreements between

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Lessee and Lessee's Architect pertaining to any element of the Project, the agreements between Lessee and Lessee's Engineer pertaining to any element of the Project.

"Development Documents" shall mean all plans, schematics, drawings, specifications and documents evidencing governmental approvals or partial approvals; permits; environmental documents; soil, engineering and planning studies; construction drawings and working drawings and the like, pertaining to the Project

''Development Standards" shall mean the standards for development ofthe Master Project outlin,ed within Exhibit U attached hereto.

"DIG" shall haye the meaning set forth in Section 5.3 of this Lease.

"Effective Date" shall mean the date set forth 8S the Effective Date in the preamble of this Lease.

"EIR" shall mean the 2003 LRDP EIR, as amended and updated by the 2005 Addendum No. I thereto.

"Election Notice" shall have the meaning set forth in Section 12.2(b) of this Lease .

. "Entitlements Documents" shall mean collectively, the LRDP, the EIR and the Implementation Plan (but only with respect to design review and land use).

"Environmental Consultant" shall mean a third party consultant with expertise in the clean-up and remediation of Hazardous Substances ~ho has been selected by Lessee and reasonably approved by the University.

"Environmental Remediation Plan" shall mean a plan for clean-up and remediation of Hazardous Substances which is designed ,to (x) comply with all Applicable Laws and the Entitlements Documents, (y) achieve a long-term solution for the affected l~d area that will permit the use of the affected land area for the uses contemplated in connection with the Master Project (except ifand to the extent no other alternative is permitted by Applicable Laws), and (z) ensure that monitoring or other facilities are not required to be maintained on the affected land area past the end of the Term (except if and to the extent no other alternative is permitted by Applicable Laws).

"FF&E" shall mean furniture. fixtures. appliances. machinery, apparatus. equipment and other personal property owned by Lessee and located within any of the Buildings or otherwise located on the Leased Land.

"Floor Amount" shall mean an amount which is determined on an individual Building by individual Building basis and shall be equal to the subject Building's allocable share of the then outstanding principal balance of the Project Financing encumbering the Project based upon the Loan Allocation (provided that in connection with the financing ofthe initial construction of the Project only, University acknowledges that interest payments will be capitalized'such that the principal balance of the Project Financing encumbering the Project during the initial construction of the Project, and the respective Loan Allocation amount derived therefrom, shall include.

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interest payments accruing during the construction period which are funded through the subject Project Financing Documents which have been included within the construction budget presented to the University in connection with the determination of the loan to cost ratio for purposes of item (i) of Section 16.2 below and the Loan Allocation); provided. however, that (x) in the case of any Joint Financing, the "Floor Amount" shall be determined for each of the Joint Financing Buildings on an individual Joint Financing Building by individual Joint Financing Building basis and shall be equal to the subject Joint Financing Building's allocable share of the then outstanding principal balance of the Joint Financing encumbering the Joint Financing Projects; (y) except as provided above with respect to the Project Financing obtained in connection with the initial construction of the Project, the Floor Amount shall be computed on the principal amount of the subject Project Financing only, and shall not include any outstanding and unpaid interest (except as provided above with respect to the Project Financing of the initial construction of the Project), late fees, default interest or other penalties, charges, fees, expenses or other amounts that the subject Leasehold Mortgagee may charge to the bolTowerlLessee, and (z) the Floor Amount shall not include any portion of any principal amount applicable to any increase in the principal loan amount of such Project Financing funded by the subject Leasehold Mortgagee, unless (A) the aggregate principal amount of the subject Project Financing complied with the provisions of items (i) or (ii), respectively, of Section 16.2 below at the time such additional principal amount was disbursed, and (8) bolTowerlLessee was not in default under the subject Project Financing or the Lease at the time such additional principal amount was disbursed.

"Force Majeure" shall mean a prevention, delay or stoppage ofa party's performance of its obligations under this Lease which arises as a result of (i) events beyond the reasonable control and prevention of the party affected by the delay, including, without limitation, strikes, acts of God, inability to obtain labor or materials, governmental restriction or delay (but only to the extent that any such delay is not attributable to the willful or negligent failure of the party whose performance is delayed to comply with requirements imposed by Applicable Laws, Governmental Authorizations, University Authorizations, University Regulations and/or the Entitlements Documents), enemy action, civil commotion, fire, or other casualty, but (w) expressly excluding financial inability, (x) expressly acknowledging that the actions of any party's employees, agents and contractors are to be deemed to be within the reasonable control and prevention of such party for the purposes of this definition, (y) expressly acknowledging that the actions of any WVCP Parties are to be deemed to be within the reasonable control and prevention of Lessee for .~e purposes of this definition unless such actions (1) amount to a failure to perform WVCP's obligati,Pns under the Master Lease which failure arises as a result of an event of "Force Majeure" (as such term is defined within and determined pursuant to the terms of the Master Lease), and (2) such failure by the WVCP actually prevents, delays or stops Lessee's performance of its obligations under this Lease, and (z) expressly acknowledging that the actions of any Sub-Phase Lessee Parties (other than any Third Parties) while on or about the Leased Land are to be deemed to be within the reasonable control and prevention of Lessee for the purposes of this definition unless such actions of such party (1) amount to a failure of a Sub-Phase Lessee to perform such Sub-Phase Lessee's obligations under the Sub-Phase Lease to which such Sub-Phase Lessee is a party which failure arises as a result ofan event of "Force Majeure" (as such term is defined within and determined pursuant to the terms of the Sub-Phase Lease to which such Sub-Phase Lessee is a party), and (2) such failure by the subject Sub-Phase Lessee actually prevents, delays or stops Lessee's performance of its obligations under this

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Lease, or (ii) with respect to a claim of Force Majeure by (x) Lessee or Guarantor, as the affected party, any University Default, which adversely affects such affected party's ability to perform, and (y) University as the affected party, any Lessee Default which adversely affects University's ability to perform.

"GAAP" shall mean Generally Accepted Accounting Principles, consistently applied.

"Governmental Authorizations" shall mean (i) as applied to the Lessee Parties, the Sub·Phase Lessee Parties, the Occupants (and their guests and invitees) and Guarantor, any and all consents, approvals, and permits of applicable governmental authorities having jurisdiction over the Leased Land as may be necessary to construct the Project and/or the Delegated Punch List Work and/or operate the Project in the manner contempla~ed by this Lease, excluding any University Authorizations, and (ii) as applied to the University and the University Parties; any and all consents, approvals, and permits of applicable governmental authorities having jurisdiction over the Master Project Leased Land, the University Infrastructure Improvements and/or the Delivered Infrastructure as may be necessary for University or any such University Party, as applic~ble, to fulfill its obligations hereunder, excluding the University Authorizations.

"Guarantor" shall mean CP Investment Fund II, L.P., a Delaware limited partnership.

"Guaranty" shall mean that form of Guaranty attached hereto as Exhibit E.

"Hazardous Substance" shall mean (a) any material or substance defined as (i) a "hazardous waste," "extremely hazardous waste" or ''restricted hazardous waste" under Sections 25115,25117 or 25122.7, or listed pursuant to Section 25140 of the California Health and Safety Code, Division 20, Chapter 6.5 (Hazardous Waste Control law); (ii) a "hazardous substance" under Section 26316 of the California Health and Safety Code, Division 20, Chapter 6.8 (Carpenter.Presley-Tanner Hazardous Substance Account Act); (iii) a "hazardous material," "hazardous substance" or "hazardous waste" under Section 25501 of the California Health and Safety Code, Division ~O, Chapter 6.95, ''Hazardous Substance" under Section 25281 of the California Health and Safety Code, Division 20, Chapter 6.7 (Underground Storage of Hazardous Substances); (iv) a "hazardous substance" pursuant to Section 101 of the Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. § 9601 et seq. (42 U.S.C. § 9602) or any regulations promulgated thereunder or pursuant thereto; and (v) a "hazardous waste" pursuant to the Resource Conservation and Recovery Act. 42 U.S.C. § 6901 et seq. (42 U.S.C. § 6901) or any regulations 'promulgated thereunder or pursuant thereto; (b) any material or substance listed under Article 9 or defined as "hazardous" or "extremely hazardous" pursuant to Article 11 of Title 22 of the California Administrative Code, Division 4, Chapter 20; (c) any material or substance designated as a "hazardous substance" pursuant to Section 311 of the Clean Water Act, 33 U.S.C. § 1251 et seq. (33 U.S.C. § 1321) or listed pursuant to Section 307 of the Clean Water Act (33 U.S.C. § 6903) or any regulations promulgated thereunder or pursuant thereto; (d) petroleum, petroleum by-products, gasoline, diesel fuel, or other petroleum hydrocarbons; (e) asbestos and asbestos·containing material, in any form, whether friable or non-friable; (f) polychlorinated biphenyls; (g) lead and lead-containing materials; or (h) any additional substance, material or waste found to be a pollutant, contaminant, hazardous waste or hazardous substance in any reported decision of a federal or California state court, and gives rise

OHS West:260944943.1 -8-

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to liability under any federal or California common law theory based on nuisance or strict liability.

"Hazardous Substance Condition" shall mean the presence of any Hazardous Substance on or about the Leased Land which is in violation of any Applicable Laws and lor the Entitlements Documents.

''Hazardous Substance Response Report" shall mean an environmental report prepared by the Environmental Consultant with respect to any Hazardous Substance Condition which shall reflect, with reasonable specificity, (i) the nature of the subject Hazardous Substance Condition, (ii) an Environmental Remediation Plan for the remediation and clean-up of such Hazardous Substance Condition, (iii) an estimated timeline for performance of the clean-up and remediation outlined in the Environmental Remediation Plan, and (iv) an estimated budget for completing the clean-up and remediation outlined in the Environmental Remediation Plan.

"Implementation Plan" shall mean the document entitled "West Village Implementation Plan" dated November 2006, attached hereto as Exhibit G, as amended from time to time.

"Infeasibility Termination Date" shall mean the date which is fifteen (15) Business Days following the delivery ofa Notice of termination pursuant to Article XVII of this Lease.

"Infrastructure Improvements" shall mean the "First Infrastructure Segment" together with all "Required Infrastructure Improvements" corresponding to and serving the Leased Land

) (as such terms are defined in, and to be constructed by WVCP pursuant to, the Master Lease).

"Inspedion Fees" shall have the meaning set forth in Section 7.3 of this Lease.

"Inspection Fee Cap" shall mean an amount equal to the product of (i) a fraction the numerator of which is the CPI Index last published prior to the date of issuance of the final Certificate of Occupancy with respect to the Project, and the denominator of which is the CPI Index last published prior to May 1,2006, mUltiplied by (ii) an amount equal to the sum of (x) the product of Five Hundred Dollars ($500.00) multiplied by the number of Apartments which comprise a portion of the Project, plus (y) an amount for the mixed-use office and retail space which comprise a portion of the Project, if any, which does not exceed the amount charged by the City of Davis for comparable inspection fees .

. "Interesf' shall have the meaning set forth in Section 21.13 of this Lease.

"Joint Financing>t shall mean a joint loan for purposes of providing Project Financing in connection with the construction and/.()r future operation of two or more projects to be located within the Student Housing Area.

"Joint Financing Building" shall mean each individual commerciaVresidential building comprising a portion of the Joint Financing Projects.

"Joint Financing Debt Service Coverage Ratio" shall mean the aggregate Joint Financing Net Operating Income for the Joint Financing Projects divided by an amount equal to the aggregate amount of interest and principal which will be payable under all Project Financing

OHS West:260944943.1 -9-

with respect to the Joint Financing Projects which is proposed to be in place following any such refinancing, collectively, during the twelve (12) full calendar month period following the date of such measurement; provided, however, (~) for the purpose of calculating "Joint Financing Net Operating Income" utilized in computing the "Joint Financing Debt Service Coverage Ratio", the Joint Financing Net Operating Income shall be computed using the actual rents reflected within the most recent monthly rent roll for the Joint Financing Projects multiplied by twelve (12) to extrapolate to an annual rental stream, and using an expense factor with respect to the Joint Financing Projects computed based upon the actual expenses for the twelve (12) full calendar month period preceding the date of such measurement, and (b) for the purpose of calculating "Joint Financing Debt Service Coverage Ratio"·with respect to the initial refmancing of the construction loan following Completion of the Joint Financing Projects, the Joint Financing Net Operating Income will be computed assuming ninety-six percent (96%) occupancy of the Joint Financing Buildings at the initial rental amount being charged to Occupants pursuant to each of the Joint Financing Guarantors' respective marketing materials and operating budget for the Joint Financing Projects.

"Joint Financing Guarantors" shall mean collectively, Lessee and aU 'other Sub-Phase Lessees who lease portions of the Student Housing Area which are to be encumbered by any proposed Joint Financing.

"Joint Financing Guaranty" shall mean that form of Joint Financing Guaranty attached hereto as Exhibit F-2.

"Joint Financing Net Operating Income" shall mean, with respect to any specified period, (i) all rents, charges, fees, expense recovery, revenues and other income, including interest income (other than security deposits from tenants or other Occupants under valid leases or other agree~ents and insurance, Net Awards and Payments or similar proceeds and ~wards) actually received by any of the Joint Fin~ciDg Guarantors (or by any of their respective agents for the account of any such Joint Financing Guarantors) in connection with the operation of the Joint Financing Projects (or any portions thereof), determined, on a cash basis, minus (ii) any expense paid or to be paid by any of the Joint Financing Guarantors (or .any of their respective agents 011 account or on behalf of any such Joint Financing Guarantors) in connection with the operation of the Joint Financing Projects or any portions thereof, determined on an accrual basis, in accordance with GAAP (excluding depreciation, amortization of intangible assets and amortization of any costs related to financing (such as points, fees and similar loan origination fees», including, without limitation, (w) all payments required to be made pursuant to any management, franchise or other agreement, (x) general and administrative, marketing, utilities, operations and maintenance and other expenses, (y) legal, accounting, appraisal and other professional fees, costs and disbursements, including annual fees and other amounts (including indemnity payments) payable annually or otherwise,-and (z) taxes, insurance premiums and impositions of any type, each as calculated for the subject period in which Joint Financing Net Operating Income is being measured.

"Joint Financing Projects" shall mean the Project together with all other projects (whether then existing or to be constructed) that are located (or to be located) upon portions of the Student Housing Area which are leased to the other Joint Financing Guarantors pursuant to their respective Student Housing Sub-Phase Lease with the University.

ORS West:260944943.1 -10-

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"Lease" shaH mean this ground lease, as it may be amended from time to time by written agreement of University and Lessee.

"Leased Land" shall have the meaning set forth in Recital C of this Lease.

"Leased Land Area" shall mean that certain land located in the County ofY 010, State of California, as more particularly described in Exhibit A-2 attached hereto and incorporated herein by reference, together with all rights and privileges appurtenant thereto.

"Leasehold Mortgagee" shall mean any bank, savings and loan association, pension fund, insurance company, bond issuer, or other institutional fmanciallender who is a party to any Project Financing Documents, holds a security interest in Lessee's Interest pursuant thereto, and otherwise meeting the requirements ofSecfion 16.2.

"Leasehold Mortgagee Affiliate" shall mean an entity controHing, controlled by or under common control with Leasehold Mortgagee.

"Leasehold Mortgagee Excluded Obligations" shall mean (A) any monetary obligations of Lessee pursuant to (x) items (a) through (g) of Section 13.1, (y) item (i) of Section ·13.1, and/or (z) Section 15.3(b), which monetary obligations arise with respect to events first occurring or conditions existing prior to the date Leasehold Mortgagee acquires Lessee's mterests in this Lease or enters into a New Lease, andlor (B) any monetary obligations of Lessee pursuant to item (h) ofSecfion 13.1 to the extent relating to actions of Lessee and/or its Affiliates; provided, however, that the term Leasehold Mortgagee Excluded Obligations shall not include, nor shall limitations in this Lease related to Leasehold Mortgagee Excluded Obligations apply with respect to, the obligation to cure any defect in construction or remedy any condition necessary for completion of any Building in accordance with this Lease or the obligation to reimburse University pursuant to Article XV with respect to any such cure or remedy performed by University.

"Lender's Notice" shall have the meaning set forth in Section 16.6(a) of this Lease.

"Lessee" shall f!1ean WVCP CLUSTER 1, LLC, a California limited liability company.

"Lessee Default" shaH have the meaning set forth in Section 15.1 of this Lease.

"Lessee Parties" shall mean (i) Lessee and the employees and agents of Lessee; (ii) prior to Completion of the Project and during the period ofaDY subsequent alterations, renovations, Restoration, or additions to the Project, or any portion thereof, the construction contractors of Lessee; (iii) prior to Completion ofthe Project, any materialman or supplier who is accessing the Access Areas andlor the Leased Land in connection with such construction activities who has been engaged by any of the parties referenced in the preceding items (i) and (ii); (iv) during the period of any alterations, renovations, Restoration, additions or other Work with respect to the Project, or any portion thereof, having an aggregate value of Fifty Thousand Current Dollars ($50,000.00) and occurring after the Completion ofthe Project, any materialman or supplier who is accessing the Access Areas and/or the Leased Land in connection with such Work who has been engaged by any of the parties referenced in the preceding items (i) and (ii); and (v) following Completion of any Building comprising a portion of the Project, any property

OHS West:260944943.1 -11-

manager, facilities manager, maintenance personnel, landscape manager or similar contractor, and the respective employees of each such contractor, who have been retained by Lessee, or any of Lessee's agents, in connection with the operation of the Project; provided, however, if any of the contractors identified in item (v) above (a) are hired or retained solely as independent contractors for the purpose of providing goods or services to or for the Project, (b) are not affiliates of Lessee, (c) are only accessing the Project, or any portions thereof, on a non-repetitive basis for the purpose of providing contracted work having an aggregate value (in anyone or more transactions over the course Of any twelve (12) consecutive month period of the Tenn) of less than an amount equal to Twenty Thousand Current Dollars ($20,000.00), and (d) would not be recognized or treated as the employee or agent of either Lessee or any affiliate of Lessee upder Applicable Laws, then the contractor meeting all of the requirements of the preceding items (a) through (d) shall not be considered a "Lessee Party" for purposes ofthe indemnities provided to the University Indemnitees by Lessee pursuant to Section 13.1 below.

"Lessee Surrender Fee Paymenf' shall have the meaning set forth in Section 17.2 of this Lease.

"Lessee's Architect" shall mean MVE Institutional, Inc.

"Lessee's Contractor" shall have the meaning set forth in Section 5.7 of this Lease.

"Lessee's Engineer" shall mean Cunningham Engineering Corporation.

"Lessee's Interest" shall mean Lessee's entire interest in (i) the Leased Land, (ii) the Project, and (iii) this Lease.

"Letter of Completion" shall mean a Notice issued by the University certifying that the Delegated Punch List Work is complete and evidencing completion of the portion of the Infrastructure Improvements of which the Delegated Punch List Work is a part.

"Loan Allocation" shall mean the Leasehold Mortgagee's allocation of the principal amount of the Project Financing between each of the individual Buildings comprising the Project which allocation shall be made at the time the Project Financing Documents are entered into; provided, however, in the case of any Joint Financing, the "Loan Allocation" shall be determined for each of the Joint Financing Buildings on the basis of the principal amount of the Joint Financing.

"Lot" shall have the meaning set forth in Recital B of this Lease.

"Lot Reimbursement Amount" shall have the meaning set forth in Section 17.4 of this Lease.

"LRDP" shall mean the UC Davis Long Range Development Plan, dated October 2003, and approved by University in November 2003, as amended, updated or replaced from time to time.

"Master Lease" shall mean that certain Master Ground Lease, dated August 25, 2008, between University and West Village Community Partnership, LLC, a Delaware limited liability

OHS Wesl:260944943.l -12-

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company, as the same may be amended from time to time by the written agreement ofWVCP and the -qniversity.

"Master Lease Effective Date" shall mean August 25, 2008.

"Master Project" shall mean the project to be constructed upon the Master Project Leased Land, including, without limitation, (i) a mixed use residential and retail development which is intended to incorporate (x) apartment buildings containing apartment stYle sleeping units housing between one'thousand eight hundred (1,800) Student Beds and one thousand nine hundred eighty (1,980) Student Beds, some of which will be located above retail space, and (y) mixed-use buildings containing approximately forty-four thousand (44,000) gross square feet of mixed-use office and retail space located beneath floors containing some of the Student Beds described in, and comprising a portion of, the figures for Student Beds set forth in the preceding item (x), and (ii) not more than three hundred forty-three (343) Residences.

"Master Project Leased Land" shall have the meaning set forth in Recital A of this Lease.

"Maximum Student Bed Co~nt" shall mean three hundred thirty (330) Student Beds.

"Mitigation Measures Responsibilities" shall have the meaning set forth in Section 5.6 of this Lease.

"Mixed-Use Area" shall mean that area designated as "Mixed-Use" as generally depicted upon Exhibit A-3 attached hereto.

"Modified Terms Notice" shall have the meaning set forth in Section 12.3(d) of this Lease.

"Modified Terms Offer" shall have the meaning set forth in Section 12.3(d) of this Lease.

"Municipal Fees Amount" shall have the meaning set forth in Section 7.2(b) of this Lease.

"Municipal Fees Amount (Construction Phase)" shall have the meaning set forth in Section 7.2(a) of this Lease.

"Net Awards and Payments" shall have the meaning set forth in Section ll.l(i) of this Lease.

''Net Operating Income" shall mean, with respect to any specified period, (i) all rents, charges, fees, expense recovery, revenues and other income, including interest income (other than security deposits from tenants or other Occupants under valid.leases oi' other agreements and insurance, Net Awards and Payments or similar proceeds and awards) actually received by Lessee (or by any of its agents for the account of Lessee) in connection with the operation ofthe Project, determined, on a cash basis, minus (ii) any expense paid or to be paid by the Lessee (or any of its agents on account or on behalf of Lessee) in connection with the operation of the

OHS West:260944943.1 -l3-

Project, determined on an accrual basis, in accordance with GAAP (excluding depreciation, amortization of intangible assets and amortization of any costs related to financing (such as points, fees and similar loan origination fees», including, without limitation, (w) all payments required to be made pursuant to any management, franchise or other agreement, (x) general and administrative, marketing, utilities, operations and maintenance and other expenses, (y) legal, accounting, appraisal and other professional fees, costs and disbursements, including annual fees and other amounts (including indemnity payments) payable annually or otherwise, and (~) taxes, insurance premiums and impositions of any type, each as calculated (or the subject period in which Net Operating Income is being measured.

"New Lease" shall have the meaning set forth in Section 16.6(a)(iii) of this Lease.

"Notices" shall have the meaning set forth in Section 21.1 of this Lease

"Notice of Waiver" shall have the meaning set forth in Section 17.4(c) of this Lease.

"Occupant" shall mean a sublessee who is a party to either a Student Bed Sublease or a Commercial Sublease.

"OFAC" shall have the meaning set forth in Section 16.3 of this lease.

"Offer Notice" shall have the meaning set forth in Section 12.2(a) of this Lease_.

"Offer Terms" shall have the meaning set forth in Section 12.2(b) of this Lease.

"Official Records" shall mean the Official Records ofthe County Recorder of Yolo County, California.

"OREA(s)" shall mean those certain Operating and Reciprocal Easement Agreement(s) by and between WVCP, Lessee and certain Sub·Phase Lessees.

"Outside Project Commencement Date" shall mean the date which is twelve (12) months following the later of (i) the Effective Date, and (ii) the University Infrastructure Completion Date.

"Outside Project Completion Date" shall mean the date which is sixty (60) months following the Outside Project Commencement Date (as such date may be extended due to Force Majeure).

"Partial Taking" shall have the meaning set forth in Section H.I(ii) of this Lease.

"Pending Sale Notice" shall have the meaning set forth in Section 12.3(a) of this Lease.

"Performance Guaranty" shall mean that form of Performance Guaranty attached hereto as Exhibit F·3.

"Permitted Use" shall have the meaning set forth in Section 4.1 of this Lease.

OHS West:260944943.1

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"Permitted Telecommunications License" shall have the meaning set forth in Section 4.S(e) ofthis Lease.

"Physical Condition Claims" shall mean any and all demands, liens, claims, legal or administrative proceedings, losses, liabilities, damages, penalties, fmes, liens, judgments, costs or expenses whatsoever (including, without limitation, court costs and attorneys' fees and disbursements), whether direct or indirect, known or unknown, foreseen or unforeseen, that may arise on account of or in any way be connected with the Project and the development thereof, including, without limitation, (i) any such items resulting from or arising out of the physical condition of the Access Areas and/or the Leased Land, including, without limitation, all struc~ral and seismic elements, all mechanical, electrical, plumbing, sewage, heating, ventilating, air conditioning and other systems, the environmental condition of the Access Areas and the Leased Land and the presence of Hazardous Materials on, under or about the Access Areas and/or the Leased Land, and (ii) any such items arising in connection with the enforcement of any federal, state and local statutes, regulations, rules, ordinances, and all other governmental requirements (including orders of court) applicable to the Leased Land andlor the Project, or any portion thereof, including, without limitation, any Applicable Laws, University Regulations, the Entitlements Documents andlor any law or regulation applicable to Hazardous Materials.

"Plans And Specifications" shall mean Certified Preliminary Plans and any additional plans, specifications, schematics and construction drawings for the Project, which have been reviewed and approved as provided in Section 5.4 and Exhibits D and U attached hereto.

) "Pre-Completion Hazardous Cou"dition" shall have the meaning set forth in Section 17.1 of this Lease.

"Preliminary Plans" shall mean the initial proposed plans, specifications, schematics and design development drawings for the Project, which are to be submitted for review and approval pursuant to the terms of Section 5.3 and Exhibit S of this Lease. Once the Preliminary Plans have been approved by the University or determined to not require University approval pursuant to Section 5.3 and Exhibit S, they will be referred to as the Certified Preliminary Plans.

"Project" shall mean a residential development which is intended to be constructed upon the Leased Land and to incorporate Buildings containing apartment style sleeping units housing up to the Maximum Student Bed Count; provided, however, that the term Project shall not include any Delegated Punch List Work.

"Project Financing" shall have the meaning set fqrth in Section 16.2 of this Lease.

"Project Financing Documents" shall have the meaning set forth in Section 16.2 ofthis Lease.

''Property Management Standards" shall mean the standards for management and operation of the Project outlined within Exhibit B attached hereto.

"Proprietary Names" shall have the meaning set forth in Section 4.7(c) of this Lease.

"Purchase Offer" shall have the meaning set 10rth in Section 12.3(a) of this Lease.

OHS West:260944943.1 ~15-

"Recommencement Of Work Notice" shall have the meaning set forth in Section 5.13 of this Lease.

"Recreational Facilities" shall mean the facilities that may be hereinafter developed upon the portion of the Student Housing Area designated as Lot Y, which may include a leasing office, a recreational facility building, a pool and other facilities.

"Recreational Facilities Agreemenf' shall mean the Shared Use Agreement and any other shared use agreement, license or other agreement relating to the Recreational Facilities entered into between the Sub-Phase Lessees who have rights to use of the Recreational Facilities.

"Recreational Student Housing Cluster" shall mean the portion of the Student Housing Area designated as Lot Y.

''Reduced Offer Notice" shall have the meaning set forth in Section 12.2(d) of this Lease.

"Reduced Offer Terms" shall have the meaning set forth in Section 12.2(d) of this Lease.

"Related Entity" shall have the meaning set forth in Section 6.3 of this Lease.

"Released Parties" shall have the meaning set forth in Section 2.4(d) of this Lease.

"Releasing Parties" shall have the meaning set forth in Section 2.4(d) of this Lease.

"Required TNW Amount" shall mean an amount equal to the greater of (i) One Hundred Million Dbllars ($100,000,000.00), and (ii) the product of (x) One Hunc;ired MiJlion Dollars ($100,000,000.00), multiplied by (y) a fraction the numerator of which is the CPI Index last published prior to the subject Adjustment Date, and the denominator of which is the CPI Index last published prior to February 1,2007.

''Residence'' shall mean one of the single-family residential units that is intended to form a part of the Master Project, provided that, for the purposes of this definition, where a single-family residential unit is located on the same legal parcel of real property as a cottage unit, such single-family residential unit together with such cottage unit shall count as 'one Residence.

"Restore" or "Restoration" shall mean the repair, replacement or reconstruction of damage or destruction caused to any portion of the Project, the University Infrastructure Imp~ovements and/or the Delivered Infrastructure, as applicable, to at least substantially the same condition of such portion of the Project, the University Infrastructur-e Improvements and/or the Delivered Infrastructure, as applicable, as existed prior to such damage or destruction.

"Right of Offer" shall have the meaning set forth in Section 12.2 of this Lease.

"Right of Redaction" shall have the meaning set forth in Section 16.2 of this Lease.

"Right of Refusal" shall ~ve the meaning set forth in Section 12.3 of this Lease.

OHS West:260944943.1 -16-

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"Service Provider" shall have the meaning set forth in Section 4.S(e) of this Lease.

"Shared Use Agreement" shaH mean an agreement by and between the Sub-Phase Lessees lea~ing the Student Housing Area pertaining to the shared use and maintenance of the Recreational Facilities. '

"Stop Work Notice" shall have the meaning set forth in Section S.13 of this Lease.

"Student Bed" shall mean an apartment style living space improvement, for one occupant, to be constructed upon the Leased Land as contemplated by the Implementation Plan and the Design Review Criteria, as interpreted by the DIG, and "Student Beds" shall mean collectively, all apartment style living space improvements for such occupancy to be constructed upon the Leased Land as contemplated by the Implementation Plan, the Development Standards, and the Design Review Criteria; provided. however, in each case any proposed double occupancy of any residential units shall be noted in any Preliminary Plans submitted with respect to such residential unit. By way of example, an apartment unit designed for a single occupant shall count as one (1) Student Bed, an apartment unit designed for dual occupancy (whether in one bedroom area or two bedroom areas), shall count as two (2) Student Beds, and an apartment unit designed for quad occupancy (whether in two or more bedroom areas), shall count as four (4) Student Beds, provided, that in no event shall an Apartment unit be designed for an aggregate occupancy in excess of six (6) ' Student Beds.

"Student Bed Sublease" shall mean a sublease agreement entered into between Lessee and the Occupant of a Student Bed having a tenn of !lot greater than twenty-fpur (24) consecutive months, but in any event co-terminus with the Term Expiration Date.

"Student Bed Sublease Commencement Date" shalJ mean the date for initial occupancy of a Student Bed specified in the .Student Bed Sublease with respect to such Student Bed.

"Student Bousing,Area" shall mean the areas designated as the Mixed-Use Area and as the Student Housing Area within Exhibit A-3 to the Master Lease, as such Exhibit may be modified or amended from time to time.

"Student Housing Sub-Phase Lease" shall mean a Sub-Phase Lease between a Sub-Phase Lessee and the University entered into pursuant to the terms of Section 6.3 of the Master Lease for the purpose of development, construction and marketing and/or operation of buildings housing Student Beds within the Student Housing Area.

"Subdivision Map" shall have the meaning set forth in Recital B of this Agreement.

"Sub-Phase Lease" shall mean a lease between a Sub-Phase Lessee and the University entered into pursuant to the terms of the Master Lease for the purpose of development, construction and marketing and/or operation of a cluster of Lots within the Master Project Leased Land.

"Sub-Phase Lessee" shall mean a party (other than Lessee) who, pursuant to the terms of the Master Lease, has entered into a lease with University for the purpose of development,

OHS West:260944943.1 -17-

construction and marketing andlor operation of a cluster of Lots within the Master Project Leased Land.

"Sub-Ph.se Lessee Parties" shall mean (i) all Sub-Phase Lessees and their respective employees and agents; (ii) with respect to all Sub-Phase Leases, during the period prior to the issuance of a Certificate of Occupancy with respect to all improvements to be constructed pursuant to the terms of each Sub-Phase Lease, (a) the construction contractors of the Sub-Phase Lessee who is a party to such Sub-Phase Lease, and (b) any materialman or supplier who is accessing the Access Areas andlor the Leased Land in connection with such construction ac~ivities who has been engaged by such Sub-Phase Lessee, or its employees, agents or the construction contractors referenced in the preceding item (ii)(a); and (iii) with respect to each Sub-Phase Lease involving Student Beds and the Recreational Student Housing Cluster, during the period of any alterations, renovations, festoration, or additions conducted following the issuance of a Certificate of Occupancy with respect to all improvements to be constructed pursuant to the terms of such Sub-Phase Lease, (a) the construction contractors ofthe Sub-Phase Lessee who is a party to such Sub-Phase Lease, and (b) any materialman or supplier who is accessing the Access Areas andlor the Leased Land in connection with such construction activities who has been engaged by such Sub-Phase Lessee, or its employees, agents or the construction contractors referenced in the preceding item (iii)(a).

"Taking" shall have the meaning set forth in Section 11.1(iii) of this Lease.

"Tangible Net Worth" shall mean (x) the aggregate value of the tangible assets of the party whose Tangible.Net Worth is being tested, determined (i) in accordance with GAAP excluding amortization and depreciation, or (ii) by the fair market value of assets, as verified by third party MAl certified appraisals, minus (y) the aggregate value of the l.iabilities ofthe party whose Tangible Net Worth is being tested, determined in accordance with GAAP; provided, however, that in no event shall any valuation with respect to intangible assets of the party whose Tangible Net Worth is being tested be included within the computation of Tangible Net Worth, including, without limitation, any valuation applicable to any so called "goodwill" or "blue sky".

"Taxes" shall mean all real property taxes, assessments, possessory use or interest taxes, and other governmental fee~, assessments and charges, water and sewer rates and charges and other similar governmental charges, whether general or special, ordinary or extraordinary, which may be levied, assc!ssed,_ charged or imposed, or may become a lien or charge upon the Leased Land, the Project or any part or parts thereof, or upon Lessee's estate created by this Lease, including, without limitation, possessory use or interest taxes affecting land, any buildings, any parking facilities or any other improvements now or hereafter at any time during the Term located at or on the Leased Land.

"Temporary Taking" shall have the meaning set forth in Section 11.1(iv) of this Lease.

"Term" shall have the meaning set forth in the first paragraph of Section 2.3 of this Lease.

"Term Expiration Date" shall have the meaning set forth in Section 2.3 of this Lease.

OHS West:260944943.1 -18-

)

"Termination Fee Payment" shall mean the amount computed pursuant to Exhibit V attached hereto.

Lease.

"Third Party" shall mean a Sub-Phase Lessee which is neither WVCP nor an Affiliate.

"Trigger Amounf' shall have the meaning set forth in Section 10.2 of this Lease.

"Total Taking" shall have the meaning set forth in Section ll.l(v) of this Lease.

"Total Unit Reduction" shall have the meaning set forth in Section ll.l(vi) of this

"University" shall have the meaning set forth in the preamble of this Lease.

''University Authorizations" shall mean (i) as applied to the Lessee Parties, the Sub-Phase Lessee Parties, the Occupants (and their guests and invitees) and Guarantor, any and all consents, approvals, and permits of the University as may be necessary to construct the Project and/or the Delegated Pooch List Work and/or operate the Project in the manner contemplated by this Lease; provided. however, with respect to consents, approvals and permits to the extent related to the review and approval of construction related activities and conduct of construction activities, including, design and plan review with respect to the Work, the University Authorizations shall be limited to those set forth on Exhibit D attached hereto, and (ii) as applied to the University and the University Parties, any and all consents, approvals, and permits of University as may be necessary for University or any such University Party, as applicable, to fulfill its obligations hereunder.

"University Default" shall have the meaning set forth in Section 15.2 of this Lease.

"University Indemnitees" shall have the meaning set forth in Section 13.1 of this Lease.

"University Infrastructure Completion Date" shall mean May 18, 2010.

"University Infrastructure Improvements" shall mean the improvements described in Exhibit K attached hereto.

"University Infrastructure Required Completion pate" shall mean the date constituting the "University Infrastructure Required Completion Date" (as defined in and determined pursuant to the Master Lease), as such date may be extended due to "Force Majeure" (as .defined within and determined pursuant to the Master Lease).

"University Inspectors" shall mean the persons designated by University from time to time to provide inspection services on behalf of University for the Work, including, without limitation, any third party consultant retained by University for such purpose.

"University Parties" shall mean 0) University, and (ii) the employees, agents and construction contractors of University, including University Inspectors, (iii) any materialman or supplier who is accessing the Access Areas and/or the Leased Land in connection with the work to be performed by University in connection with the University Infrastructure Improvements

ORS West:260944943.1 -19-

and/or the Delivered Infrastructure who has been engaged by any of the parties referenced in the preceding items (i) and (ii); and (iv) following Completion of any Building comprising a portion of the Project, any property manager, facilities manager, maintenance personnel, landscape manager or similar contractor, and the respective employees of each such contractor, who have been retained by University, or any of University's agents, in connection with the operation of the Access Areas and/or Project, including, the maintenance and repair of the University Infrastructure Improvements and the Delivered Infrastructure; provided. however. that (a) in no event shall University Parties include (x) without limiting the provisions of any University Sublease, any employee who is accessing any portion of the Master Project Leased Land as an owner or Occupant of any Residence or any Student Bed, unless such employee is acting within the scope of employment, or (y) any student of the University, or (z) without limiting the provisions of any University Sublease, any Occupant under any Commercial Sublease or the employees, agents, contractors or invitees of such sublessee; and (b) if any of the contractors identified in item (iv) above (x) are hired or retained solely as independent contractors for the purpose of providing goods or services to or for the Access Areas and/or Project, (y) are only accessing the Access Areas and/or Project, or any portions thereof, on a non-repetitive basis for the purpose of providing contracted work having an aggregate value (in anyone or more transactions over the course of any twelve (12) consecutive month period of the Term) of less than an amount equal to Twenty Thousand Current Dollars ($20,000.00), and (z) would not be recognized or treated as the employee of University under Applicable Laws, then the contractor meeting all of the requirements of the preceding items (x) through (i) shall not be considered a "University Party" for purposes of the indemnities provided to the Lessee Indemnitees by University pursuant to Section 13.2 below.

"University Regulations" shall mean all pOlicies, procedures, and regulations promulgated by University, as reasonably applied, pertaining to the use of University's property generally and to activities taking place on the Campus, including, without limitation, those relating to health, safety, and traffic enforcement; provided, however, with respect to regulations, to the extent such regulations relate to the review and approval of construction related activities and conduct of construction activities, including, design and plan review with respect to the Work, the University Regulations shall be limited to those set forth on Exhibit H attached hereto.

"University Sublease" shaH mean a sublease of any portion of the Project in which University is the Sublessee.

"Unique Resource" shall have the meaning set forth in Section 17.5 of this Lease.

"Violations" shall have the meaning set forth in Section 4.3 of this Lease.

"West Village" shall mean the residential and mixed-use project which is intended to be constructed upon the Master Project Leased Land, which project will include the Project.

"Work" shall mean (i) with regard to all periods prior to Completion of the Project, Lessee's construction activities and obligations with respect to the Project and the Delegated Punch List Work, including, without limitation, any site preparation performed, or to be performed, on or about the Leased Land and the obligation for payment for any costs aild

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expenses associated with the foregoing, and (ii) with regard to all periods from and after the Completion of the Project, Lessee's construction activities and obligations with respect to any changes, alterations, renovations, Restoration, Demolition involving any portion of the Project; provided, however, for purposes of this item (ii), the term "Work" shall not include (x) any repainting, recarpeting or landscape maintenance (as opposed to landscape construction and installation), or (y) any such changes, alterations, renovations, Restoration, Demolition having an aggregate value ofless than Fifty Thousand Current Dollars ($50,000.00).

"WVCP" shall mean the lessee under the Master Lease.

"WVCP Parties" shall mean (i) WVCP, (ii) the employees, agents and construction contractors of WVCP, and (iii) any materialman or supplier who is accessing the Access Areas andlor the Master Project Leased Land in connection with the Master Project who has been engaged by any ofthe parties referenced in the preceding items (i) and (ii).

ARTICLEll GRANT, TERM AND CONDmON

Section 2.1 ~. In consideration of the covenants and agreements to be observed and performed by the parties hereto, effective as ofthe Effective Date, University hereby leases to Lessee, and Lessee hereby hires from University, the Leased Land to be used solely for the Permitted Use. Subject to the rights reserved to University hereunder, including, without limitation the rights set forth in Section 4.8, Section 5.9, Section 15.3 and Section 21.4, Lessee shall have the right to the exclusive use of the Leased Land for the purposes set forth in this Lease. In addition, University hereby grants to the Lessee Parties, a non-exclusive license to enter upon (i) those road and street areas of the Campus which lie West of State Route 113 that are reasonably necessary in order to obtain access to the Leased Land for purposes of allowing Lessee to perform its obligations and enjoy its rights and privileges hereunder, and (ii) the Delivered Infrastructure Areas (as such term is defmed in and such areas are determined pursuant to the Master Lease), together with those portions ofthe Master Project Leased Land generally depicted upon the Subdivision Map as roadways and landscape areas, for the purpose of obtaining access to the Leased Land and completing construction of the Delegated Punch List Work, in each case, to allow Lessee to perform its obligations and enjoy its rights and privileges hereunder (the preceding items (i) and (ii), collectively her~in the "Access Areas"), which licenses shall not be revoked by University so long as this Lease remains in full force and effect, but shall be co-terminus with the expiration or earlier termination of this Lease. Lessee hereby acknowledges and agrees that, in exercising the rights with respect to the Access Areas granted pursuant to the preceding sentence, the Lessee Parties shall (A) comply with all Applicable Laws, Governmental Authorizations, University Authorizations, University Regulations and the Entitlements Documents, and (B) coordinate their respective activities with, and avoid interference with the operations of, the WVCP Parties and the Sub-Phase Lessee Parties. In addition, University hereby grants to each Occupant and to the invitees of such Occupant, a non-exclusive license to enter upon the Access Areas as reasonably necessary in order to obtain access to the Leased Land for purposes of allowing such Occupant to enjoy its rights and privileges under the respective Student Bed Sublease or Commercial Sublease to which such Occupant is a party. Such license shall not be revoked by University for any Occupant so long

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as the Occupant has a Commercial Sublease or Student Bed Sublease which is in full force and effect.

Section 2.2 Reserved.

Section 2.3 Inm. The term ("Term") of this Lease shall commence on the Effective Date and expire, without notice or other action by either party, at 1.2:00 midnight on the sixty-fifth (6S~ anniversary ofthe Construction Commencement for the first Building (the "Term EXl!iration Date").

Section 2.4 Condition of Leased Land.

(a) Lessee's Investigation. Lessee accepts the Leased Land "as is/in its present cOIiditionlwitb all faults" without representation or warranty <:>fUniversity of any kind, including, without limitation, any representation or warranty as to the nature and/or scope of any Governmental Authorizations necessary in connection with the Project and/or any portion thereof and subject to all encumbrances, liens, restrictions, or other matters affecting title as of the Effective Date (collectively, "Title Exceptions"), whether such Title Exceptions are of record or not; provided, however, that the foregoing acceptance shall not waive, limit or release University's obligations within this Lease with respect to (i) completion of the University Infrastructure Improvements, (ii) maintenance and repair of the University Infrastructure Improvements and the Delivered Infrastructure, and (iii) any Physical. Conditions Claims resulting from or arising out of the activities of any University Parties in perfonnance of the obligations referenced in the preceding items (i) and (ii). Lessee acknowledges that it has had the advice of such independent attorneys, professional consultants and experts as it deems necessary in connection with its investigation and study of the Leased Land and has, to the extent it deemed necessary, independently investigated the condition of the Leased Land, including the soils, hydrology and seismology thereof, title to the Leased Land, and the Applicable Laws, Governmental Authorizations, University Regulations and the Entitlements Documents relating to the construction, operation, leasing and sale of the Project, including, without limitation, the Buildings. Without limiting the foregoing, Lessee acknowledges that prior to entering into this Lease, (i) Lessee has had the opportunity to fully review the LRDP and the EIR, (ii) Lessee received Lessee's Interest through .a transaction involving WVCP and WVCP has been actively involved in the development of the Implementation Plan, and (iii) Lessee has been fuJly informed that the construction, operation, leasing, maintenance, sale and use of the Project, and all portions thereof, and all use of the Leased Land shall be subject to compliance with Applicable Laws, the Governmental Authorizations, the University. Authorizations, the University Regulations and the Entitlements Documents. .

(b) Suitabilitt of Site. University makes no warranty as to the suitability of the Leased Land for the uses permitted by thi$ Lease; provided, however, that neither the non-existence of any such warranty nor Lessee's agreement to proceed without such a warranty shall constitute, nor be deemed to constitute, a waiver, limitation or release ofUniversity-'s obligations within this Lease with respect to (i) completion of the University Infrastructure Improvements, (ii) maintenance and repair of the University Infrastructure Improvements and the Delivered Infrastructure, and (iii) any Physical Conditions Claims resulting from or arising out of the activities of any University Parties in performance of the obligations referenced in the

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) preceding items (i) and (ii). University makes no covenants or warranties respecting the condition ofthe soil, subsoil or any other condition of the Leased Land, nor does University make any covenant, representation or warranty regarding the suitability of the Leased Land for the proposed development, construction or use by Lessee, including, without limitation, operation of the Project in the manner contemplated by this Lease. Without limiting the foregoing, Lessee acknowledges that the soil on the Leased Land mayor may not be suitable for the purposes intended by Lessee or be of such character and condition so as to require special engineering for construction of the Project, including, without limitation, the Buildings. In connection with the foregoing, Lessee acknowledges and agrees that Lessee shaH be responsible for any damage or destruction to the Leased Land or any real property adjacent to or serving as ingress to or egress from the Leased Land (including, without limitation, any damage resUlting from land subsidence or soil instability) to the extent either resulting from or arising out of the activities of any of the Lessee Parties on the Leased Land. Notwithstanding anything to the contrary herein, University shaH not be responsible for any land subsidence, soil instability or damage reSUlting from or arising out of such subsidence or soil instability on the Leased Land, with the exception of any such land subsidence, soil instability or damage which results from or arises out of either (i) University's obligations to be performed pursuant to Seetion 5.1 below, or (ii) any other actions of University taken after the Master Lease Effective Date; provided, however, Lessee hereby acknowledges that the mere act of entering into any licenses or easements which are contemplated pursuant to this Lease shaH not constitute an action of University for purposes of the preceding item (ii), shall not cause nor be deemed to cause the respective lessee, licensee or grantee, as applicable, thereunder to be a University Party or a party within the control of University, nor shall University have any liability or obligation with respect to any actions taken by such lessee, licensee, or grantee, as applicable, whether on or about the Leased Land, the Master Project Leased Land and/or the Access Areas. With the exception of construction and instaUation of the University Infrastructure Improvements, maintenance and repair ofthe University Infrastructure Improvements and the Delivered Infrastructure and permitting the Lessee Parties and the Occupants to access the Leased Land over the Access Areas, University shaH not be required or obligated to make any changes, alterations, additions, improvements or repairs in, on, under or about the Leased Land or any changes, alterations, additions or improvements to any real property adjacent to or serving as ingress or egress from the Leased Land.

(c) University's Continuing ObUgations. Nothing in this Semon 2.4 shall be construed to relieve University from its obligation to construct the University Infrastructure Improvements, which obligations shall be governed by the provisions ofSeetioD 5.1 below, or from University's other obligations expressly set forth in this Lease.

(d) Waiver and Release. Lessee, on behalfofitself, its members, shareholders, partners and their respective successors and assigns and any other party claiming by, through or under Lessee (collectively, the ''Releasing Parties"), waives the right to recover from and forever releases and discharges University and the University Indemnitees, and their respective heirs, successors, personal representatives and asSigns (collectively, the "Released Parties"), from liability with respect to (i) any Physical Condition Claims that any of the Releasing Parties may have or hereinafter acquire against any of the Released Parties, in either such case, whether any such Physical Conditions Claims were direct or indirect, known or unknown, foreseen or unforeseen, (ii) irrespective of whether any of the following Claims were

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direct or indirect, known or unknown, foreseen or unforeseen, any Claims that any of the Releasing Parties may have or hereinafter acquire against any of thc Released Parties to the extent resulting from or arising out of either (x) the University's grant of any license pursuant to Seetion 4.8(d), or (y) the access on, over and/or across the Leased Land by any Occupant (other than University), any Sub-Phase Lessee Parties and/or any WVCP Parties, irrespective of whether 01' not such access was pursuant to such a license granted by University. and (iii) irrespective of whether any of tile following Claims were direct or indirect, known or unknown, foreseen or unforeseen, any Claims that any of the Releasing Parties may have or hereinafter acquire against any of the Released Parties to the extent resulting from or arising out oftbe failure by WVCP to perfonn any obligations under the Master Lease, including, without limitation, a failure to complete all or any portion of the Infrastructure Improvements; provided however. that the foregoing waiver and release shall not waive, limit or release University's obligations within this Lease with respect to (I) completion of the University Infrastructure Improvements, (II) maintenance and repair of the University Infrastructure Improvements and the Delivered Infrastructure, and (Ill) any Physical Conditions Claims resulting from or arising out of the activities of any University Parties in performance of the obligations referenced in the preceding items (I) and (TI). Lessee hereby acknowledges and agrees that neither University nor any other University Indemnitees have made any representation or warranty whatsoever in connection with the Leased. Lan~ the Project and/or the.Master Project. Lessee hereby further acknowledges and agrees that the Released Parties shall not be liable for (X) damage or inconvenience to Lessce's business or for any 108s of income or profit therefrom, or (Y) with the sole exception of any obligation with respect to diminution in the property value of Lessee's Interest arising pursuant to item (h) of Section 13.1, for any consequential, indirect, incidental, special, punitive, or exemplary damages, under any circumstances, including, without limitation, upon the occurrence of any University Default. hI connection with the foregoing, Lessee, on behalf of itself and the Releasing Parties, hereby expressly waives the benefits of Section 1542 of the California Civil Code, which provides as follows:

"A GENERAL RELEASE DOES NOT EXTEND 1'0 CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECI'ED HIS OR HER SETTLEMENT WITH THE DEBTOR."

LESSEE ACKNOWLEDGES AND AGREES THAT IT HAS BEEN REPRESENTED BY LEGAL COUNSEL OF ITS CHOICE IN CONNECTION WITH THIS LEASE, AND mAT SUCH COUNSEL HAS EXPLAINED TO LESSEE THE PROVISIONS OF TIDS SECTION 2.4. BY TNmALING BELOW, LESSEE CON.FIRMS IT HAS AGREED TO THE PROVISIONS OF THIS SECTION 104.

LESSEE'S INITIALS: t t: (e) No Representations or Warranties Related to the Master Project.

Lessee acknowledges that University is neither the party constructing nor does the University control the construction of the Master Project, rather WVCP bas entered into the Master Lease with the prospective intention of constructing the Master Project In connection with the foregoing and notwithstanding anything to the contrary herein, (i) Lessee hereby acknowledges

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that the Leased Land was a portion of the Master Project Leased Land which had been previously leased to WVCP for the purpose of development of the Master Project, including, without limitation, construction and installation of the Infrastructure Improvements within the portions of the Access Areas located within the Master Project Leased Land, (ii) Lessee hereby acknowledges and agrees that neither University nor any University Indemnitees have made any representation or warranty as to when or if the Master Project, including, without limitation, the Infrastructure Improvements, will ever be completed and neither the University nor any University Indemnitees shaH have any obligation at any time to construct any portion of the Master Project, including, without limitation, the Infrastructure Improvements, and (ii) Lessee hereby acknowledges and agrees that no failure by WVCP to perform any of its obligations under the Master Lease, including, without limitation, any failure to complete construction and installation of the Infrastructure Improvements, shall constitute nor be deemed to constitute grounds for (x) an abatement of any amounts payable to University under the terms of this Lease, or (y) a waiver of any obligations imposed upon Lessee pursuant to the terms of this Lease.

(f) No Representations or Warranties Related to the Recreational Facilities. Without limiting the provisions of Section 2.4( e) above, Lessee, on behalf of itself and the other Releasing Parties, hereby acknowledges and agrees that (i) the Released Parties have made no representation or warranty to Lessee or any of the Releasing Parties regarding the Recreational Facilities, including, without limitation, whether any Recreational Facilities will in fact ever be constructed upon the Recreational Student Housing Cluster andlor any other portion of the Master Project Leased Land; (ii) the Released Parties shall have no duty or obligation to construct any Recreati9nal Facilities, including, without limitation, following the expiration or earlier termination of the Student Housing Sub-Phase Lease with respect to the Recreational Student Housing Cluster; (iii) although the Recreational Facilities Agreements may encumber Lessee's leaseh~ld interest in the Master Project Leased Land, no such encumbrance shall be superior to the University's interest in the Master Project Leased Land and no amount due under or with respect to any of the RecreatioDlll Facilities Agreements shall be a lien upon the Leased Land or any other portion of the Master Project Leased Land that is superior to University'S interest in the Master Project Leased Land; and (iv) following the expiration or earlier tennination of the Student Housing Sub-Phase Lease with respect to the Recreational Student Housing Cluster, the University may elect, in the University's sole and absolute discretion, to demolish all or any portion of the Recreational Facilities and to develop the Recreational Student Housing Cluster for other purposes. Lessee, on behalf of itself and the other Releasing Parties, hereby further acknowledges and agrees that, this Lease shall be superior to any Recreational Facilities Agreement, including, without limitation, the Shared Use Agreement. Without limiting the foregoing, following the expiration or earlier termination of a Student Housing Lease with respect to all or any portion of the Student Housing Area, the University shall have the right, exercisable in the University's sole and absolute discretion, to assume the rights and obligations under any Recreational Facilities Agreement to which such Sub·Phase Lessee was a party as of the date of such expiration or earlier termination (any such.assumed Recreational Facilities Agreement, herein an "Assumed RFA"). Lessee, on behaIf of itself and the other Releasing Parties, hereby further acknowledges and agrees that (X) with respect to any Assumed RFA, the University shall only be obligated to assume duties and obligations arising from and after the date of assumption of such Assumed RF A by the University and the University shall have no liability or obligation with respect to any obligations with respect to periods prior to the

OHS West:260944943.1 -25-

date of assumption of such Assumed RF A by the University (including, without limitation, with respect to any obligation to pay any amounts due under the subject Assumed RFA) and the University shall not be liable for any breach of performance under such Assumed RF A with respect to periods arising prior to the date of such assumption, nor shall any such breach of performance give rise to enforcement of any remedy which would deny the University the rights under the subject Assumed RF A; and (Y) with the sole exception of any obligations that the University may have under any Assumed RF A, (A) neither the University nor any of the Released Parties shall have any duty, liability or obligation with respect to any of the Recreational Facilities Agreements, including, without limitation, the Shared Use Agreement; (B) upon the expiration or earlier termination of the Sub-Phase Lease with respect to the Recreational Student Housing Cluster, all Recreational Facilities Agreements, including, without limitation, the Shared Use Agreement, shall immediately and automatically terminate and be of no further force or effect and neither the University. nor any of the Released Parties shall have any duty or obligation under any of the Recreational Facilities Agreements; (C) upon the expiration or earlier termination of a Sub-Phase Lease with respect to any portion of the Student Housing Area (other than the Sub-Phase Lease with respect to the Recreational Student Housing Cluster), the Recreational Facilities Agreements, including, without limitation, the Shared Use Agreement, shall immediately and automatically terminate and be of no further force or effect with respect to such portion of the Student Housing Area and neither the University nor any of the Released Parties shall have any liability or obligation with respect to any amounts due under the Recreational Facilities Agreements, whether or not such amounts are past due or whether or not such amounts were a lien upon the subject Sub-Phase Lessee's leasehold interest in such portion of the Student Housing Area; (0) in the event that Recreational Facilities are constructed, the Released Parties shall have no duty or obligation to·maintain, repair, replace or operate the Recreational Facilities, including, without limitation, following the expiration or earlier termination of the Student Housing Sub-Phase Lease with respect to all or any portion ofthe Student Housing Area; and (E) neither the University nor any of the Released Parties shall be a party to any Recreational Facilities Agreement, including, without limitation, the Shared Use Agreement

ARTICLE lIT GUARANTY AND FINANCIAL COVENANTS

SedioD 3.1 Guaranty. It is a condition precedent ·to University's obligations under this Lease that (i) Guarantor, contemporaneously with the execution of this Lease by Lessee, duly execute and deliver to University the Guaranty in the form of Exhibit E attached hereto and by this reference incorporated herein, and (ii) Joint Financing Guarantors, each contemporaneously with the execution of this Lease by Lessee, duly execute and deliver to University the Joint Financing Guaranty in ·the form of Exhibit F attached hereto and by this reference incorporated herein.

Seetion 3.2 Fin.gcia. Conclitions. At all times between the Effective Date and the date of the fmal release of Guarantor's obligations under the Guaranty, Lessee and Guarantor shall collectively maintain a combined aggregate minimum. Tangible Net Worth (without duplication of any valuation placed on any capital interest in Lessee held by Guarantor (i.e. Guarantor's Tangible Net Worth shall not include an asset valuation of Guarantor's equity interest in Lessee, as those assets wiU already have been counted in determining Lessee's

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Tangible Net Worth» in an amount greater than or equal to the Required 1NW Amount. Lessee and Guarantor shall (i) provide University with quarterly unaudited and unreviewed financial statements for each of Lessee and Guarantor within ninety (90) days followihg the end of each calendar quarter, and (ii) within ninety (90) days following the end of each calendar year, provide annual audited financial statements for Lessee and Guarantor, which have been audited and certified by a nationally recognized certified public accounting firm. All such financial statements shall include schedules reflecting a balance sheet, income statement and changes in financial condition and be iJi sufficient detail to allow University to understand the then current financial condition of each of Lessee and Guarantor.

Section 3.3 University's Audit Right. University, at its sole cost, shall have the right to review and audit the books and records of Lessee and Guarantor for the sole purpose of determining the accuracy of the Tangible Net Worth amount being claimed by Lessee. Both University and University's accounting firm shall keep any information gained from review of the books and records of Lessee and Guarantor confidential and shall not make copies of, shall not remove and shall not disclose to any other party the contents of any such books and records, except that University may disclose such information to a trier of fact in the event of any dispute between University and Lessee with regard to compliance with the provisions of Section 3.2 above, or as otherwise may be required by any state or federal laws, statutes, codes, rules, regulations, ordinances, requirements, or order.

Section 3.4 Joint Financing Gnaranty. Lessee, in its capacity as lessee under this Lease and as one of the Joint Financing Guarantors, hereby acknowledges that (i) the Master Lease contemplated that the Project as well as the respective projects to be constructed pursuant to each Student Housing Sub-Phase Lease which is proposed to be included within the Joint Financing, would be financed through project-specific financing which was not cross-defauhed or cross-collateralized with financing for any other project; (ii) as an accommodation to WVCP, Lessee and the other Joint Financing Guarantors, the University has agreed to permit Lessee to join with the Joint Financing Guarantors as co-borrowers in securing the Joint Financing for the initial construction of the Project and the other projects which are the subject of the Joint Financing Guarantors respective Sub-Phase Leases and has agreed to permit Joint Financing with respect to future operations of projects within the Student Housing Area; (iii) University would not have agreed to permit the joint fmancing arrangement described herein, if the Joint Financing Guarantors had not agreed (a) to jointly and severally guarantee performance of their respective leasehold obligations owed to University pursuant to the te~ms of the Joint Financing Guaranty and delivered to University the Joint Financing Guaranty as required by Section 3.1 above, and (b) that'during the existence of any Joint Financing, all Joint Financing Guarantors must be and remain subsidiaries of the same ultimate parent (whether individuals or entities) with the same respective direct or indirect ownership interest in each of the Joint Financing Guarantors; and (iv) as provided in Section lS.l(e), a breach of Lessee's obligations as one ofthe Joint Financing Guarantors under the Joint Financing Guaranty, shall constitute a Lessee Default under this Lease.

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AATICLEIV PERMITTED USE

Section 4.1 Use of Leased Land. The Leased Land shall be used solely for the construction, maintenance, use and operation of the Project (collectively, the "Permitted Use"), with such "Perinitted Use" i,ncluding, without limitation, subleasing of portions thereof pursuant to Student Bed Subleases andlor Commercial Subleases, as applicable. Any change to the Permitted Use shaH require the prior written consent of University, which consent may be granted or withheld in University's sole and absolute discretion.

Sedion 4.2 Construdion Staging. Unless otherwise agreed to in writing b~tween Lessee and WVCP andlor any Sub-Phase Lessee, which writing shall be provided to University, at all times during the Term, Lessee shall perform all construction staging for the Project on the Leased Land. Lessee shall fence such staging area and maintain it in good order in accordance with the University Regulations.

Section 4.3 Waste; Nuisance. Lessee shall not use, and shall not permit, and shall use commercially reasonable efforts to prevent, the Lessee Partie~ and the Occupants (other than University) accessing the Leased Land from using, any portion of the Leased Land or the Access Areas for any use which constitutes a waste, nuisance or unreasonable annoyance to University or which violates Applicable Laws, Governmental Authorizations, University Regulations andlor the Entitlements Documents or which constitutes a trespas~, or for any illegal purpose (all such activities being defined as ''Violations''). Lessee shall include provisions in each Commercial Sublease and in each Student Bed Sublease that prohibit the Occupant and such Occupant's guests and invitees from using any portion of the subject subleas.ed premises or the Acc~ss Areas for any use that constitutes a Violation. "Lessee· agrees that, if any activity by Lessee or·any Lessee Parties or, with the exception of University, any Occupant (or such Occupant's 'guests or invitees) constitutes a Violation, then Lessee shall promptly use commercially reasonable efforts to correct the situation, at Lessee's sole cost and expense, to University's reasonable satisfaction.

Section 4.4 Hazardous Substances. Lessee agrees that during its use and occupancy of the Leased Land that neither Lessee nor any Lessee Parties shall (1) permit Hazardous Substances not present on the Master Project Lease4 Land prior to the Master Lease Effective Date to be present on or about the Leased Land;. or (2) use, store, handle, release, emit, discharge, generate, abate, dispose or transport any Hazardous Substance on, in, under, near or emanating from the Leased Land or any of the Access Areas. In addition, Lessee shall include provisions in each Commercial Sublease and in each Student Bed Sublease that prohibit such Occupant and its guests and invitees from using, storing, handling, releasing, emitting, discharging, generating, abating, disposing or transporting any Hazardous Substance on, in, under, near ot emanating from the subject suble~ed premises, the Leased Land or any of the Access Areas and Lessee shall use commercially reasonable efforts to enforce such contractual provisions. Notwithstanding the foregoing, (A) it will not be a breach of Lessee's covenants under this Section 4.4 if a Hazardous Substance is present and Lessee would not have the obligation to respond to or remedy the condition as further provided in this Section 4.4, and (B) the Lessee Parties may handle, abate, dispose or transport any Hazardous Substances which were present on the Master Project Leased Land prior to the Master Lease Effective Date so long as such Hazardous Substances are handled, abated, disposed of and/or transported in full

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compliance with all Applicable Laws, Governmental Authorizations and the Entitlements Documents and otherwise in a safe and prudent manner, and (C) the Lessee Parties and the Occupants may use Hazardous Substances in quantities and of a type customarily used in the ordinary course of construction activities for the construction of projects similar to the Project and/or the Delegated Punch List Work, and/or of a type customarily used in the ordinary course of use of residential improvements, office/retail improvements and/or operations of projects similar to the Project, so long as such Hazardous Substances are transported, stored and .used in full compliance with all Applicable Laws, Governmental Authorizations and the Entitlements Documents and otherwise in a safe and prudent manner.

(a) Notice to University. Lessee shall promptly notify University of (i) Lessee's receipt of any notice, request, demand, inquiry or order, whether oral or written, from any government agency, alleging failure by Lessee and/or the Leased Land to comply with Applicable Laws, Governmental Authorizations and/or the Entitlements Documents, (ii) the discovery by Lessee of any release, discharge, or emission of any Hazardous Substances, or of the existence of any other condition or occurrence, which may constitute or pose a significant present or potential hazard to human health and safety or to the environment, whether or not such event or discovery necessitates any report to any other person or government agency and whether or not such release, discharge or emission is caused by Lessee, or (iii) the occurrence of any event or existence of any condition that would cause a breach of any of the covenants set forth in this Section 4.4. Receipt of such notice shall not be deemed to create any obligation on the part of University to defend or otherwise respond to any such notification.

(b) Lessee Response and Remedy. Lessee shall promptly respond to and remedy (by removal and proper disposal or such other methods as shall be reasonably required), to the full satisfaction of applicable governmental agencies (x) any release or discharge of any Hazardous Substances resulting from or arising out of Lessee's operation or Lessee's presence on the Leased Land and/or the actions of any Lessee Parties, including, without limitation, any such release or discharge in, on or about the Access Areas and/or any other portion ofthe Master Project Leased Land, and (y) any condition upon any portion of the Leased Land Area which constitutes a violation of Applicable Laws, Governmental Authorizations and/or the Entitlements Documents with respect to Hazardous Substances and which is required under Applicable Laws, Governmental Authorizations anellor the Entitlements Documents to be remediated in connection with construction of the Project for its intended use, or portions thereof; provided, however, that, without limiting the obligation to respond under item (x) above or any obligations set forth in Article XVII below, the obligation to respond under this item (y) shall not extend to (i) any Hazardous Substances for which University is obligated to respond pursuant to Section 5.1 below, (ii) Access Areas, (iii) ifthis Lease is tenninated by Lessee in response to a University Default, as and when permitted pursuant to Section 15.4, then any such Hazardous Substances for which Lessee has not commenced a response as of the date of such termination of this Lease, (iv) any Hazardous Substance Condition with respect to which Lessee elects to terminate this Lease-pursuant to Section 17.1 below, (v) if this Lease is terminated by Lessee pursuant to Section 17.2 below, then any such Hazardous Substances for which I,.essee has not commenced a response as of the date of Lessee's delivery of Notice ofits election to so terminate this 'Lease pursuant to said Section 17.2 below, (vi) if this Lease is tenriinated by University pursuant to Section 17.4 below and Lessee does not deliver a Notice of Waiver pursuantto Section 17.4(c) below, then any such Hazardous Substances for which Lessee has not commenced a response as

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of the date of University's delivery of notice of its election to terminate this Lease pursuant to said Section 17.4 below, (vii) if this Lease is terminated by Lessee ptirsuant to Section 17.5 below, then any such Hazardous Substances for which Lessee has not commenced ·a response as of the date of Lessee's delivery of notice of its election to terminate this Lease pursuant to said Section 17.5 below; and (viii) any Hazardous Substance Condition which has not been identified and/or discovered prior to the Completion of the Project.

All such action required under this Section 4.4(b) shall be done in Lessee's name, and at Lessee's sole cost and expense. For purposes of this Section 4.4, the term "respond" (and derivations thereof) shall include, but not be limited to, the investigation of environmental conditions and, in the event of a significant or substantial release, the preparation by an Environmental Consultant Qf an Environmental Remediation Plan. Any such actions shall be performed in a good, safe, workmanlike manner and shall minimize any impact on the businesses or operations conducted at the Leased Land, the Master Project Leased Land andlor on or about the Access Areas. Notwithstanding the foregoing, prior to commencing any work in connection with the Environmental Remediation Plan, Lessee and University shall review and approve the Environmental Remediation Plan, which approval shall not be unreasonably withheld. Ifboth Lessee and University approve the Environmental Remediation Plan, then Lessee shall promptly carry out such Environmental Remediation Plan. If either Lessee or University rejects all or any portion of the Environmental Remediation Plan, then University and Lessee shall attempt to resolve any dispute in the nature and/or scope of the remediation set forth in the Environmental Remediation Plan within fifteen (15) Business Days following University's delivery of Notice to Lessee that University disapproves of any portion of the Environmental Remediation Plan. If University and Lessee are unable to agree upon modifications to the Environmental Remediation Plan within the fifteen (15) Business bay period described in the preceding sentence, then University and Lessee shall submit the matter to arbitration conducted in accordance with the rules and procedures of the American Arbitration Association, provided, that the arbitrators selected to conduct such arbitration shall be from an environmental consulting firm of similar experience and capabilities as those of the Environtnental Consultant and shall not have been employed by University, the Lessee Parties or any oftheir respective counsel within five (5) years ofthe date of appointment as an arbitrator hereunder.

(c) University Actions. University shall have the right, but not the obligation, upon a breach of any of the covenants set forth in this Section 4.4, without in any way limiting University's other rights and remedies under this Lease, (x) to take such actions as it deems reasonably necessary or advisable, to respond to any Hazardous Substances or contamination ·by Hazardous Substances present on, in, at, under, or emanating from, the Leased Land or the Access Areas in violation of Lessee's obligations under this Section 4.4, (y) to negotiate, defend, approve and appeal any action taken or order issued by any governmental . agency or authority with regard to any such Hazardous Substances or contamination by Hazardous Substances which results from or arises out of a violation of Lessee's obligations under this Section 4.4. As a precondition for claiming the right to recover costs and expenses incurred in connection with any such action pursuant to Section 4.4(d), University shall provide Lessee with not less than ten (10) Business Days prior written Notice of University's intention to take any such action; provided, however, that no such·advance written Notice shall be required where University's actions are taken to avoid an imminent threat of injury to public health and safety resulting from or arising out of the presence of the subject Hazardous Substance. The

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costs and expenses reasonably paid or incurred by University in the exercise of the rights set forth in this Section 4.4(c) shall be payable by Lessee upon written demand together with Interest computed from the date such funds are expended by University.

(d) Costs and Reimbursements. Lessee shall pay for all costs resulting from or arising out of the presence of any Hazardous Substances on the Leased Land, the Master Project Leased Land, the Access Areas andlor any real property adjacent to the Leased Land andlor the Access Areas which presence in each case results from or arises out of a breach of Lessee's obligations under this Section 4.4. The obligations of Lessee set forth herein shall include, without limitation, compensation to University for diminution in value of the Leased Land, the Master Project Leased Land, the Access Areas andlor any real property adjacent to the Leased Land, the Master Project Leased Land, andlor the Access Areas resulting from or arising out of the presence of the Hazardous Substances for which Lessee is obligated to ~espond pursuant to this Section 4.4 and the nature of the remediation which is conducted in "response" thereto.

(e) Reporting. Notwithstanding anything to the contrary herein, Lessee and University shall cooperate in connection with the reporting 9f any Hazardous Substances on, in, under, near or emanating from any Commercial Lots comprising the Leased Land or any of the Access Areas to any applicable governmental authorities and in connection with seeking any determination of the scope or necessity of clean-up, remediation andlor monitoring of any such Hazardous Substances. In connection with the foregoing, each party shall present to the other with a copy of any written reports or other correspondence which such party intends to submit prior to submission thereofto the applicable governmental authority and shall afford such other party the opportunity to comment upon the content of such report or correspondence and the opportunity to submit such additional information as such other party deems necessary or reasonably appropriate; provided, however, that (i) e~cept where any reporting is required by Applicable Laws, Governmental Authorizations andlor the Entitlements Documents, Lessee shall not submit any such report or correspondence to any governmental authority without first obtaining the prior written consent to the content of such report or correspondence from University, which consent may be granted or withheld in University's reasonable discretion, and (ii) nothing contained herein shall preclude either party from notifying such party's lender of the presence of any such Hazardous Substance to the extent such notification is required pursuant to a loan or other financing agreement entered into by such party.

(t) Early Termination. IffoUowing the Completion of the Project, (w) any condition is discovered upon any portion of the Leased Land Area which constitutes a violation of Applicable Laws, Governmental Authorizations andlor the Entitlements Documents with respect to Hazardous Substances, (x) the Hazardous Substances which are the subject of the preceding item (w) are required to be remediated under Applicable Laws, Governmental Authorizations andlor Entitlements Documents in connection with continued operation of the Project for its intended use, (y) the presence of the Hazardous Substances which are the subject of the preceding item (w) in, on or about the Leased Land Area did not arise from or otherwise relate to the use, storage, handling, release, emission, discharge, generation, abatement, disposal or transportation. of any Hazardous Substance on, in, under, near or emanating from the Leased Land or any of the Access Areas by any of the WVCP Parties andlor any Lessee Parties, and (z) the obligation for remediation ofthe Hazardous Substances which are the subject of the

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preceding item (w) are not imposed upon University pursuant to the terms ofthis Lease or upon any Sub-Phase Lessee pursuant to the terms of a Sub-Phase Lease, then Lessee shall have the right, exercisable in Lessee's sole and absolute discretion, to either (a) terminate this Lease without any compensation from University, or (b) elect to permanently waive the right to terminate this Lease with respect to such Hazardous Substance Condition identified in the preceding item (a) and to proceed with development and operation ofthe.Project pursuant to the terms of this Lease without any compensation from University with respect to such Hazardous Substance Condition. In connection with the discovery of any such Hazardous Substance, Lessee shall cause the Environmental Consultant to prepare a H~dous Substance Response Report, as provided in Section 4.4(b) above. Within ninety (90) days following Environmental Consultant's completion and delivery to University and Lessee of the Hazardous Substance Response Report showing the Hazardous Substance Condition referenced in the introductory Sentence of this paragraph, Lessee shall provide Notice to University of its election pursuant to the introductory sentence of this paragraph; provided, however, if Lessee fails to provide Notice to University of its election pursuant to the introductory sentence of this paragraph within such ninety (90) day period, then Lessee shall be deemed to have elected to waive the right to terminate this Lease with respect to such Hazardous Substance Condition, as provided in item (b) of the introductory sentence of this paragraph. Irrespective of whether Lessee elects to proceed in accordance with item (a) of the introductory sentence of this paragraph, or elects to, or is deemed to have elected to, proceed in accordance with item (b) of the introductory sentence of this paragraph, Lessee shall execute such reasonable documents as University may reasonably request to memorialize such election or deemed election, including, without limitation, an acknowledgement that the waiver and release set forth in Section 2.4(d) above extends to s!lch Hazardous Substance Condition.

(i) If Lessee elects to terminate this Lease pursuant to the rights granted to Lessee. within this Section 4.4(1), then within Thirty (30) Business Days after Lessee's election (1) Lessee shall surrender and vacate the Leased Land and all portions of the Project in the surrender condition required pursuant to Section 14.2 below, and (2) if the Project Financing Documents remain an encumbrance upon Lessee's Interest on the date of Lessee's surrender and vacating of the Leased Land, then Lessee shall cause Leasehold Mortgagee to immediately record a release of any security interest Leasehold Mortgagee haslhad in Lessee's Interest, which r~lease shall be accomplished through the recording in the Official Records of the County of a customary release document which has been approved by University in the exercise of its reasonable discretion. Upon satisfaction of the preceding item (1), this Lease shall terminate and all of Lessee's rights in the Leased Land, and every part thereof, and all of Lessee's rights in the Project, and every party thereof, shall terminate and Lessee's right, title and interest in the Project (including Lessee's right, title and interest in and to any Student Bed Sublease and any Commercial Sublease), the Development Documents and the Development Agreements related to the Project shall automatically 8Jld without additional compensation to Lessee become the property and vest in University. Upon any termination of this Lease pursuant to this Section 4.4(1), Lessee shall execute such documents as University may reasonably request to me~orialize the termination of this Lease and the transfer to University of all interests of Lessee in the Project (including Lessee's right, title and interest in and to any Student Bed Sublease and any Commercial Sublease), the Development Documents and the Development Agreements.

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) (g) Surrender. Upon the expiration or earlier tennination of this Lease,

Lessee shall surrender the Leased Land to University in the surrender condition required pursuant to Section 14.2 below.

(h) Survival. Lessee's obligations and liabilities pursuant to the provisions of this Section 4.4 shall survive the expiration or earlier termination of this Lease; provided, however, that upon the Completion ofthe Project, Lessee's obligations and liability pursuant to item (y) of Section 4.4(b) shall terminate with respect to any such Hazardous Substances which have not been identified and/or discovered on or before such date of termination.

Section 4.5 Compliance With Applicable Laws. Subject to Lessee's right to contest in accordance with Section 4.6 below, Lessee shall (I) at its sole cost and expense, at all times during the Term, comply with, (II) cause Lessee's Contractor to comply with, (1lI) include provisions in all Commercial Subleases and Student Bed Subleases requiring each Occupant and its guests and invitees to comply with, and (IV) without limitation of the preceding obligations, use commercially reasonable efforts to cause all Lessee Parties and all Occupants (together with their respective guests and invitees) to comply with: (a) all Applicable Laws, Governmental Authorizations, University Authorizations, University Regulations and the Entitlements Documents, including, without limitation, (i) acquisition of and compliance with all permits, licenses, orders, requirements, approvals, plans and authorizations which are or may become necessary for conduct of Lessee's operations on the Leased Land; and (ii) compliance with all regulatory requirements relating to such operations or the substances and equipment used therein; and (b) all recorded covenants, conditions and restrictions affecting the Leased Land now in force or which may hereafter be in force, including, without limitation, the OREA(s); provided, however, that the fact that Lessee has taken such steps shall not relieve Lessee of its obligations to cause all portions of the Project to comply with all Applicable Laws, Governmental Authorizations, University Authorizations, University Regulations and the Entitlements Documents pursuant to Seetion 5.5 below.

Section 4.6 Right to Contest.

(a) At Lessee's sole cost and expense, Lessee, by appropriate legal proceedings brought in good faith and diligently prosecuted in its name, may contest the validity or applicability to the Leased Land, or any part thereof, of any Applicable Laws, including, without limitation, any Applicable Laws related to Hazardous Substances; provided, however, tha~ if any such contest or proceeding is, with University's prior written consent (to be granted or withheld in University's sole and absolute discretion), maintained in the names of both Lessee and University, it shall be maintained without cost to University.

(b) University reserves the right to contest the applicability to the Leased Land or validity of any Applicable Laws, including, without limitation, any Applicable Laws related to Hazardous Substances; provided. however, that if any such contest or proceeding is, with Lessee's prior written consent (to be granted or withheld in Lessee's sole and absolute discretion), maintained in the names of both Lessee and University, it shall be maintained without cost to Lessee.

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(c) Immediately upon receipt of notice of action or proceeding from any governmental agency alleging a violation of Applicable Laws and seeking to enforce any legal requirement on the Leased Land or the development of the Leased Land, each party shall give Notice to the other party of such alleged violation.

Section 4.7 Advertising and Signs.

(a) Master Project Naming Rights. Lessee hereby acknowledges and agrees that University, in conjunction with WVCP, shall name all streets, park areas and other improvements to be constructed as part ofthe Master Project, with the exception of the Buildings. In connection with the same, WVCP shall present to University, for University's review and approval in the exercise of University's sole discretion, a proposed list of names for all streets, park areas and other improvements to be constructed as part of the Master Project. Notwithstanding the foregoing, Lessee acknowledges and agrees that University shall have the reasonable right, upon not less than thirty (30) days prior Notice to Lessee, to change the name of any building (other than the Buildings), park area or other improvement or otherwise change the address of the Leased Land or any portion thereof, at any time. If University exercises its right pursuant to the preceding sentence, then University shall reimburse Lessee for any actual out-of-pocket expenses incurred by Lessee in reprinting or modifying marketing materials andlor signs where such reprinting or modification is required solely as a result of University' s exercise of its rights pursuant to the preceding sentence. Lessee hereby acknowledges and agrees that, with the sole exception of the out-of-pocket costs referred to in the preceding sentence, Lessee waives all claims for compensation or damages caused by any such change.

(b) Location and Placement of Signs. Neither Lessee nor any of its employees, agents, contractors andlor its Leasehold Mortgagee, shall place, construct or maintain any signs, advertisements, names, insignia, trademarks, descriptive material, or any other similar . item, on any portion of the Leased Land which has not been approved by University in writing. In connection with the foregoing, Lessee shall present to University, for University's review and approval in the exercise of University's sole discretion, any such signs, advertisements, names, insignia, trademarks, descriptive material, or any other similar item, which is intended to be placed upon any portion of the Leased Land, including a reasonable description of the size and proPQsed location thereof. University shall review and approve or disapprove any such signs, advertisements, names, insignia, trademarks, descriptive material, or any other similar item (including, without limitation, any of the foregoing related to a Commercial Sublease), within fifte~n (15) Business Days following receipt of Notice of any such proposal from Lessee; provided, however, that University shall not withhold its consent to any such signs, advertisements, names, insignia, trademarks, descriptive material, or any other similar item which conforms to the signage guidelines attached hereto as Exhibit AA. If University disapproves of any such signs, aavertisements, names, insignia, trademarks, descriptive material, or any other similar item, then the parties shall meet and confer with respect to the signs, advertisements, names, insignia, trademarks, descriptive material, or any other similar item, which has been disapproved by University in an attempt to resolve any disagreement thereto. Any signs or graphics installed on Leased Land shall be installed by Lessee at its sole cost and expense. In addition, Lessee shall (i) include provisions in all Commercial Subleases and Student Bed Subleases prohibiting each Occupant and its guests and invitees from placing, constructing or maintaining any signs, advertisements, names, insignia, trademarks, descriptive

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material, or any other similar item, on any portion of the Leased Land which is either located outside of or visible from the outside of such Occupants respective sublease premises, unless such sign, advertisement, name, insignia, trademark, descriptive material, or pther similar items has first been approved by University in writing, and (ii) use commercially reasonable efforts to enforce such contractual provisions. If Lessee or any of its employees, agents, contractors or invitees or any Occupant (or its guests or invitees), violates this provision and does not cure such violation within five (5) Business Days following Notice of such violation, University, at Lessee's cost, may remove any item placed, constructed or maintained on any portion of the Leased Land that does not comply with the provisions of this Section 4.7.

(c) University Name. The names "The University of California," "The Regents," "UCD," "UCDavis," "UC Davis," "University of California, Davis," and all variations or permutations thereof, are proprietary to University (collectively, the "Proprietary Names'') and neither Lessee nor any of its employees, agents, contractors or invitees, including, without limitation, the Leasehold Mortgagee, shall have or acquire any property right or interest in the Proprietary Names and/or any trademark, service mark, trade name or symbol of the University, the University of Cali fomi a, Davis and/or Campus. Without limiting the generality of the foregoing, except as permitted under this Section 4.7, neither Lessee nor any of its employees, agents, contractors or invitees, including, without limitation, the Leasehold Mortgagee, shall make use for commercial or promotional purposes, at any time, any of the Proprietary Names, or make or use any photographs, videos, drawings, images or other representations of the University of California, Davis and/or the Campus or any other buildings or properties owned by University, other than buildings located on the Leased Land, or any trademark, service mark, trade name or symbol of the University, the University of California, Davis and/or the Campus. In addition, with the excepti9n of the use of the name "West Village" in the name of Lessee and the use of the name "West Village" in connection with the Master Project, neither Lessee nor any of its employees, agents, contractors or invitees, including, without limitation, the Leasehold Mortgagee, shall have or acquire any right to use the name "West Village" or any variation or permutation thereof in any manner which would imply, or would reasonably be anticipated to imply, any connection of such entity, the Master Project or any other project.

Section 4.8 University's Reserved Uses.

(a) Construction and Maintenance Access. Lessee acknowledges that, in connection with University's obligations under this Lease, University shall construct the University Infrastructure Improvements, and University shall maintain and operate the University Infrastructure Improvements and the Delivered Infrastructure. In connection with the foregoing, University and its employees, agents, contractors and invitees shall have the right to enter upon the Access Areas, during an emergency and/or at all reasonable times, for the purpose of maintaining, operating and repairing the Delivered Infrastructure and operating the University Infrastructure. Lessee and University agree to coordinate their construction activities on and around the Access Areas to minimize, to the extent reasonably feasible, the impact of each other's respective construction activities upon the construction activities of the other; provided, however, that such cooperation shall take into consideration the delivery scheduling imposed upon University hereunder in connection with performance of its con~ction obligations related to the University Infrastructure Improvements.

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(b) Reservation orOll. Gas. Water and Mineral Rights. Notwithstanding anything to the contrary herein, University reserves to itself the sole and exclusive right to prospect for, drill for, produce, and take and remove any subsurface water, oil, gas, or other hydrocarbon or mineral substances and accompanying fluids, including all geothermal resources from the Master Project Leased Land, including the rights to drill, maintain subsurface pressures, and utilize subsurface storage space for natural substances. Lessee shall have no right or claim to any such subsurface water, oil, gas or other hydrocarbon or mineral substances and accompanying fluids, including, without limitation, the existing water wells located upon the Leased Land, and the same may be taken and removed by University without any compensation to Lessee in connection therewith. Notwithstanding the foregoing, during the Term of this Lease, (I) University shall (i) not drill or otherwise access such resources from the surface of the Leased Land, (ii) exercise University's rights with respect to such resources, other than subsurface water, if at all, only from reserves which are located at the depth of five hundred (500) feet from the surface of the Leased Land, through methods of slant drilling from locations outside of the Leased Land, (iii) maintain subsurface pressures in connection with any such extraction activities, and utilize subsurface storage space for natural substances only, and (iv) not disturb the quiet enjoyment and peaceful use of the Leased Land in connection with any exercise of the rights set forth in this Section 4.8(b), and (ll) Lessee shall have the right, after receipt of the University's prior written consent (not to be unreasonably withheld, conditioned or delayed), at Lessee's sole cost (but without any rental, charges or fees from the University except for inspection fees, if any, which may be required throughout the Term), to drill for~ establish, maintain, operate and use water wells and any related collection, delivery, storage, and treatment facilities/improvements on the Leased Land (collectively, "Wells"), and to extrac4 store, treat (if needed), deliver and consume for irrigation p.urposes only any water derived from such Wells for the benefit of Lessee, WVCP, the other Sub-Phase Lessees, and their respective, employees, agents, contractors, subcontractors, tenants, licensees, invitees, and guests; provided (i) Lessee at all times complies with Applicable Laws with respect to any such activities, and (ii) Lessee does not use the Wells for any other purpose than irrigation related to the Master Project.

(e) Easements. University reserves to itself the right to grant to others in the future non-exclusive easements for utilities, telecommunications facilities and similar public services, over, under, through, across or On the Leased Land in locations that will not unreasonably interfere with Lessee's use of the Leased Land; provided, however, University shall, to the extent reasonably feasible, limit such easements to locations within the road beds and landscaped areas of the Project and restrict the improvements to be constructed to subsurface improvements; provided, further however. to the extent any such improvements cannot be feasibly located subsurface, University shall require the grantee of such easement to appropriately screen such improvements from public view. Any such easement shall include such indemnities or other legal protections in (avor of the lessee of the Leased Land with respect to such rights of access as University customarily obtains from easement holders for comparable easements. Any interference arising as a result of construction of improvetnents related to the utility, telecommunications Or similar public service facilities constructed in cOnnection with any such easement granted by University shall be temporary, and all work on the Leased Land shall proceed expeditiously. Lessee shall be given reasonable Notice before commencement of any work on the Leased Land. In the event the installation or maintenance of such utility, telecommunications or similar public service facilities within such future easements causes any damage to the Leased Land, or any portion thereof, including, without limitation, pavement,

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curbs, sidewalks and landscaped areas, University shall promptly repair the same, or cause the same to be repaired, to its prior condition at no cost or expense to Lessee. Notwithstanding the foregoing, upon the written request of Lessee, University shall grant or enter into an easement, license or similar agreement with any government agency, special district or public utility with reference to sewer, water, gas, telephone, storm drain and other. utility lines, landscape improvements, lighting, utility facilities, improvements and/or connections, lines, pipes, . distribution systems and the like, pursuant to which University grants to such government agency, special district or public utility a right of access across portions of the Campus or Leased Land as necessary to provide services to the Master Project; provided, however. that (a) Lessee shall look solely to the grantee of such easement to repair any damage to the Leased Land, or any portion thereof, including, without limitation, pavement, curbs, sidewalks and landscaped areas, caused by such grantee, and (b) any such easement agreement by the University shall include such indemnities or other legal protections with respect to such rights of access as University cqstomarilyobtains from third party utility providers that provide services to University.

(d) Licenses. University reserves to itself the right to grant to any Sub-Phase Lessee Parties andlor any WVCP Parties, in the future non-exclusive licenses over, under, through, across or on the portions of the Leased Land which are to be used for road and street areas for purposes of allowing such parties to access other portions of the Master Project Leased Land for the purposes of constructing any portion of the Master Project. In connection with the foregoing, Lessee hereby agrees to coordinate all activities on the Leased Land with such parties to facilitate construction of the Master Project. In connection with the foregoing, Lessee hereby acknowledges that any license entered into by University pursuant to the terms of this Section 4.8(d) is for the purpose of facilitating phasing and segmentation of the construction of the Master Project requested by WVCP and, in connection therewith, Lessee hereby agrees (i) to affirmatively cooperate and coordinate all activities on the Leased Land with such parties to facilitate construction ofthe Master Project, and (ii) that the mere act of entering into any such license, shall not cause nor be deemed to cause the licensees thereunder to be University Parties or parties within the control of University, nor shall University have any liability or obligation with respect to any actions taken by such licensees, whether on or about the Leased Land, the Master Project Leased Land and/or the Access Areas.

(e) Telecommunications Facilities. University reserves to itself the exclusive right to maintain and operate, and/or to grant to others in the future licenses or easements for the placement and operation of, telecommunications facilities on or about the Leased Land; provided however. that the design and other physical aspects of any tower, antenna, dish or other above-ground equipment to be constructed and/or used thereunder shall be subject to review of the DIG pursuant to Section 5.3 and Section 5.4 below and that such equipment and easements shall not unreasonably interfere with Lessee's use of the Leased Land and shall be shielded to the extent commercially reasonably possible from public view. Without limiting the foregoing, Lessee may enter into a license or other right of use conforming to the requirements set forth below (herein a "Permitted Telecommunications License") with any telecommunications provider (herein a "Service Provider") for the purpose of providing telephone, WIFI or other internet connectivity service, and/or digital or cable television services to the Project; provided however, except upon receipt of University's written consent (which may be granted or withheld in University's sole discretion), any such Permitted Telecommunications License shall:

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(i) prohibit the subject Service Provider from (x) providing the subject service to any area outside of the Leased Land (except to the leased land ofthe· Sub-Phase Lessee of the Recreational Student Housing Cluster andlor another Sub-Phase Lessee who has constructed Student Beds if, in either case, such Sub-Phase Lessee is a party to the agreement with respect to such Permitted Telecommunications License), (y) installing equipment and/or utilizing equipment for the transmission, retransmission or boosting of any transmission of any telecommunications technology to areas outside of the Leased Land, and (z) operating any telecommunications equipment in a manner which interferes with or disrupts the use and enjoyment the Leased Land by any Occupant andlor interferes with the operation of any other telecommunications, equipment located on, upon or around the Master Project Leased Land,

(ii) include an acknowledgment and agreement by such Service Provider that University has the right to (x) operate any telecommunications equipment in, about or around the Master Project Leased Land, (y) provide, andlor to grant any license to any other party to provide, any telecommunications services to any portion of the Master Project Leased Land, and (z) immediately terminate the Service Provider's operation of any equipment which University determines is interfering with the University's public safety and/or life safety communications andlor dispatch systems, and

(iii) require the Service Provider to (v) obtain DIG approval, pursuant to Section 5.3 and Section 5.4 below, of the design and other physical aspects of any above-ground equipment to be constructed and/or used by such Service Provider on or about the Leased Land, (w) shield such equipment from public view, to the extent commercially reasonably possible, (x) comply with all Applicable Laws, Governmental Authorizations and University Regulations, (y) promptly resolve any interference problems with other equipment located in, on or about the Master Project Leased Land, now or at any time during the continued term of the subject Permitted Telecommunications License, and (z) indemnify, defend and hold University and -the University Indemnitees harmless from any claims, costs, liability or loss resulting from or arising out of the acts, errors, or omissions of such Service Provider.

In connection with the foregoing, Lessee hereby acknowledges and agrees that, (I) the respective Service Provider who is a party to any Permitted Telecommunications License shall be a Lessee Party for the purposes of this Lease, (II) with the exception of any Permitted Telecommunications License which complies with the provisions of the preceding items (i), (ii) and (iii), Lessee shall have no right to grant any lease, sublease, license or other right of use to any telecommunications provider intending to operate any tower, antennae, dish or other equipment for the purpose of transmitting, retransmitting or boosting transmission of any telecommunications technology, including, without limitation, any cellular telephone service, WlFI or other internet connectivity service, and digital television, and any such lease, sublease, license or other right granted by Lessee shall be void and of no force or effect, and (Ill) Lessee shall, promptly following executioh thereo~ provide University with a copy of each Permitted Telecommunications License entered into by: Lessee for the purpose of confirming compliance with the requirements of this Section 4.8(e), provided, that Lessee may redact any economic terms reflected within such Permitted Telecommunications License.

(I) No Abatement or~Release. In connection with University's exercise of the rights reserved pursuant to this Section 4.8, Lessee acknowledges and agrees that no action

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taken by University in compliance with the terms of this Section 4.8 shall constitute nor be deemed to constitute grounds for an abatement of any arnounts payable to University under the terms of this Lease or a waiver of any obligations imposed upon Lessee pursuant to the tenns of this Lease.

ARTICLE V CONSTRUCTION AND IMPROVEMENT OF LEASED LAND

Section 5.1 University Infrastructure Improvements. University shall, at its sole cost and expense, design and construct the University Infrastructure Improvements. In the event the University Infrastructure Improvements have not been completed prior to the Effective Date, University hereby acknowledges and agrees that, subject to Force Majeure delay (as determined between University and WVCP pursuant to the Master Lease), following selection of a contractor or contractors to perfomi such work, University shall diligently prosecute construction of the University Infrastructure Improvements to substantial completion (as determined pursuant to the Master Lease) on or before the University Infrastructure Required Completion Date.

(a) Compliance with Applicable Laws. University shall construct the University Infrastructure Improvements, in accordance with Applicable Laws, University Regulations, and the Entitlements Documents and the requirements of governmental authorities having jurisdiction over the University Infrastructure Improvements.

(b) University Hazardous Substances. University agrees that during the .. Term neither University nor any University Parties shall use, store, handle, release, emit, discharge, generate, abate, dispose or transport any Hazardous Substance on, in, under, near or emanating from (i) the Leased Land, or (ii) the Access Areas in a manner which would materially interfere with, or otherwise materially and adversely affect, the use of the Access Areas and/or the Leased Land as contemplated by this Lease. Notwithstanding the foregoing, (A) it will not be a breach of University's covenants under this Section 5.1 if a Hazardous Substances is present and University would not have the obligation to respond to or remedy the condition as further provided in this Section 5.1, (B) the University Parties may use Hazardous Substances in and around the Leased Land in quantities and of a type customarily used in the ordinary course of construction activities for the construction of projects similar to the University Infrastructure Improvements and/or the maintenance and operation of the University Infrastructure Improvements andlor the Delivered Infrastructure so long as such Hazardous Substances are transported, stored and used in full compliance with all Applicable Laws, the LRDP and the EIR. and otherwise in a safe and prudent manner, and (C) the University Parties may use Hazardous Substances in and around the Access Areas so long as such Hazardous Substances are transported, stored and used in full compliance with all Applicable Laws, Entitlements Documents and otherwise in a safe and prudent manner.

(i) University Response and Remedy Hazardous Substances. University shall promptly respond to and remedy (by removal and proper disposal or such other methods as shall be reasonably required), to the full satisfaction of applicable governmental agencies any release or discharge of any Hazardous Substances resulting from or arising out of the Univer~ity Parties' actions in completion of the University Infrastructure Improvements andlor maintenance and repair of the University Infrastructure Improvements and the Delivered

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Infrastructure, including without limitation, any such release or discharge in, on or about (i) the Leased Land, or (ii) the Access Areas where presence of such Hazardous Substances would materially interfere with, or otherwise materially and adversely affect, use of the Access Areas and/or the Leased Land as contemplated by this Lease; provided, however, that the obligation to respond shall not extend to any Hazardous Substances for which Lessee is obligated to respond pursuant to Section 4.4 above. All such actiOn shall be done in University's name, and at University's sole cost and expense. For purposes hereof, the term "respond" (and derivations thereof) shall include, but not be limited to, the investigation of environmental conditions and, in the event of a significant or substantial release, the preparation by an Environmental Consultant of an Environmental Remediation Plan. Any such actions shall be performed in a good, safe, workmanlike manner and shall minimize any impact on the businesses or operations conducted at the Leased Land, the Master Project Leased Land, and/or on or about the Access Areas. Notwitbstanding the foregoing, prior to commencing any work on the Leased Land in connection with the Environmental Remediation Plan, Lessee and University shall review and approve the Environmental Remediation Plan with respect to the response in areas of the Leased Land which

. approval shall not be unreasonably withheld. Ifboth Lessee and University approve the Environmental Remediation Plan with respect to the response in areas of the Leased Land, then University shall promptly carry out such Environmental Remediation Plan. If either Lessee or University rejects all or any portion of the Environmental Remediation Pian with respect to the response in areas of the Leased Land, then University and Lessee shall attempt to resolve any dispute in the nature andlor scope of the remediation set forth in the Environmental Remediation Plan with respect to the response i~ areas of the Leased Land within fifteen (15) Business Days following Lessee's delivery of Notice to University that Lessee disapproves of any portion of the Environmental Remediation Plan which addresses the response in areas of the Leased Land. If University and Lessee are unable to agree upon modifications to the Environmental Remediation Plan within the fifteen (15) Business Day period described in the preceding sentence, th~n University and Lessee shall submit the matter to arbitration conducted in accordance with the rules and procedures of the American Arbitration Association, provided, that the arbitrators selected to conduct such arbitration shall be from an environmental consulting firm of similar experience and capabilities as those of the Environmental Consultant and ~hall not have been employed by University, the wvCP Parties, the Lessee Parties, any Affiliates or any of their respective counsel within five (5) years of the date of appointment as an arbitrator hereunder. Notwithstanding the foregoing or anything to the contrary herein, in no event shall Lessee have any rights to review or approve University's response to nor any Environmental Remediation Plan with respect to any Access Areas and/or portions of the Master Project Leased Land which do not form a part of the Leased Land.

(ii) Survival. University's obligations and liabiJities pursuant to the provisions of this Section 5.1(b) shall survive the expiration or earlier termination ofthis Lease.

(c) Permits for Improveinents. Without limiting the generality of the provisions of Section 5.1(a) above, University shall be responsible for '(i) obtaining aU consents, approvals and permits of applicable governmental authorities have jurisdiction over the University Infrastructure Improvements, ~d (ii) paying all costs and expense of complying with the requirements of all consents, approvals and permits of applicable governmental authorities have jurisdiction over the University Infrastructure Improvements.

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(d) Lessee Cooperation. Lessee, in its capacity as lessee under this Lease, will reasonably cooperate with University, at no cost or expense to Lessee, in obtaining all consents, approvals and permits of applicable governmental authorities required to be obtained by University pursuant to this Lease. Said cooperation of Lessee, in its capacity as lessee under this Lease, shall include prompt execution by a duly authorized officer of Lessee of such documents and instruments as are reasonably necessary to obtain such consents, approvals and pennits of applicable governmental authorities having jurisdiction over the University Infrastructure Improvements. Lessee, in its capacity as lessee under this Lease, may, and, if required by Applicable Laws, shall, join in University's application for any consents, approvals and permits of applicable governmental authorities having jurisdiction over the University Infrastructure Improvements. Notwithstanding the foregoing, in no event shall Lessee be required to cooperate with University in any effort which Lessee reasonably believes either to be (x) illegal, (y) contrary to the terms ofthe Implementation Plan, or (z) contrary to terms of this Lease.

(e) Mitigation Measures. Without limiting the obligations ofWVCP and Lessee set forth in Section 5.6, University shall perfonn, or cause to be performed, any mitigation measures which are (i) required by any applicable govemmentalauthorities having jurisdiction over the University Infrastructure hnprovements in connection with development of the University Infrastructure Improvements, and (ii) not the responsibility of either WVCP (as determined pursuant to the Master Lease) or of Lessee (as detennined pursuant to Section 5.6).

(t) Warrant of Capacity. University hereby warrants to Lessee that, from and after the University Infrastructure Required Completion Date, the University Infrastructure Improvements shall pennit operation of the applicable services which are the subject of such University Infrastructure Improvements at levels that will satisfy the service capacity requirements of the Project which ~ set forth in Exhibit X attached hereto. In the event that the University Infrastructure Improvements, or any portion thereof, are found, at any point during the Term following the later of (i) the University Infrastructure Required Completion Date, and (ii) WVCP's comple~ion of the construction and installation of the Infrastructure Improvements, to be inadequate to meet such capacity requirements of the Project which are set forth in Exhibit X attached hereto, then University shall, at University's sole cost and expense, construct alterations to the University Infrastructure Improvements, or portions thereof, to increase the capacity thereof to the level sufficient to meet the service capacity requirements of the Project which are set forth in Exhibit X attached hereto.

(g) Reserved.

(h) Maintenance by University. Subject to WVCP's construction and installation of the Infrastructure Improvements in accordance with the obligations set forth in the Master Lease, during all times of the Term of this Lease following the later of (i) the University Infrastructure Required Completion Date, and (ii) WVCP's completion of the construction and installation of the Infrastructure Improvements, University shall, at University's sole cost and expense, maintain the University Infrastructure Improvements and the Delivered Infrastructure in a good, clean, attractive and sanitary and safe order, condition, habitability and repair, taking into consideration the nature of University's obligations hereunder. University's maintenance obligations shall include (i) the obligation to maintain the Delivered Infrastructure in good

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condition and repair, and (ii) the obligation to Restore the Delivered Infrastructure and the University Infrastructure Improvements following any damage or destruction. Notwithstanding the foregoing, in the event ofa tennination of the Master Lease for any reason at aU, University shall not be obligated to maintain any Infrastructure Improvements which are not necessary to serve the Project at the capacity requirements of the Project which are set forth in Exhibit X attached hereto.

(i) University Provision of Services' Subject to (i) WVCP's construction and installation of the Infrastructure Improvements in accordance with the obligations set forth in the Master Lease, and (ii) the provisions of Section 5.8 below (including, without limitation, Lessee's payment of the costs thereof in accordance with Section 5.8(a) below, and Lessee's obligations with respect to connections, hook-up fees and temporary utilities), during the Term of this Lease, University shall supply the Project with the reasonably required supply of domestic water, electricity, sanitary sewer and reclaimed water services, if applicable, taking into consideration the scope and nature of the Project. Upon the occurrence of an Abatement Event (as defined below), a portion of the Basic Rent.in the proportion that the number of Student Beds affected by the subject Abatement Event bears to the Maximum Student Bed Count shall be abated during the period of the continuation ofthe subject Abatement Event; provided, however, Lessee shall not be entitled to any such abatement of Basic Rent unless Lessee either (x) correspondingly abates the rent payable to Lessee by the Occupant(s) affected by such Abatement Event for the period thereo~ or (y) pays temporary relocation benefits, hotel costs, or other temporary alternative living expenses for such affected Occupant(s) during such period. As used herein, the term "Abatement Event" shall mean the occurrence of an interruption in either domestic water service, electricity serviqe, sanitary sewer service or reclaimed water services, which (1) continues for a consecutive period of seven (7) Business Days, (2) actually prevents one or more Occupants from occupying such party's respective Student Bed, and (3) results from either (x) the University's breach of the University's obligations to construct the University Required Infrastructure Improvements andlor breach of its obligations to maintain, repair, replace or Restore the University Required InfrastructUre Improvements and Delivered Infrastructure, or (y) damage or destruction of the University Required Infrastructure Improvements andlor any Delivered Infrastructure, or (z) a breach of University's warrant of capacity set forth in Section 5.1(1) above.

Section 5.2 -Protect. Lessee shall, at its sole cost and expense, design and construct the Project upon the Leased Land in accordance with the Plans And Specifications. So long as there exists no uncured University Default, Lessee shall commence and diligently prosecute construction of the Project in accordance with the Plans And Specifications. In addition, Lessee shall, at its sole cost and expense, construct the Delegated Punch List Work in accordance with the requirements related thereto contained within the Master Lease.

(a) Project Completion Deadlines. The Construction Commencement with respect to the first Building to be constructed as it portion of the Project shall occur on or before the Outside Project Commencement Date (as extended due to Force Majeure) and the Project shall be completed, including, without limitation, Completion of each of the Buildings comprising the Project, and Completion of the Delegated Punch List Work, on or before the Outside Proj~t Completion Da~ (as extended due to Force Majeure), unless otherwise agreed to in writing by the University, in th-e exercise of the University's sole and absolute discretion.

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(b) Delivery Damages. If(i) either (x) the Completion of the Project has not occurred on or before the Outside Project Completion Date (as extended due to Force Majeure), or (y) a Certificate of Occupancy has not been issued by the Student Bed Sublease Commencement Date with respect to the Building, or relevant portions thereof, in which a Student Bed which is the subject of an applicable Student Bed Sublease is located, and (ii) as a result of such delay, any Occupant under an applicable Student Bed Sublease is unable to take occupancy of the Student Bed which is the subject of such Student Bed Sublease, on the applicable Student Bed Sublease Commencement Date, then Lessee shall provide and pay for, at Lessee's sole cost and expense, the following services:

(i) the costs and expenses of alternative bed spaces for use by Occupants who have signed Student Bed Subleases, which shall be provided in comparable substitute living quarters in numbers equal to the number of Student Beds required under each applicable Student Bed Sublease for which Lessee was unable to provide occupancy to the applicable Occupant on or before the applicable Student Bed Sublease Commencement Date,

(ii) the costs and expenses of moving from the alternative bed spaces referenced in the preceding item (i) to the applicable Student Beds within the Project, as and when such Student Beds are available for occupancy, and

(iii) if any of the alternative bed spaces referenced in the preceding item (i) are located more than three (3) miles (measured following available driving or bicycling transportation routes) from the Memorial Union on the Campus, provide the Occupants located

) in such alternative bed spaces with reasonable transportation to and from the Campus.

Section 5.3 Design Implementation Group.

(a) DIG Authority. Lessee and University hereby acknowledge and agree that University has established a team of University staff members to serve as the Design Implementation Group ("DIG'') in accordance with the procedures set forth in Exhibit S attached hereto. As outlined in Exhibit S attached hereto, the FEPC of the University is the governing body for review of the design of the Project. However, the FEPC has delegated authority to the DIG for the review of certain elements of the Project which fall within the scope of "Design Review Criteria" adopted by the DIG, as amended from time to time in accordance with Exhibit S.

(b) DIG Participation and Review. As provided in the Implementation Plan and in Exhibit S attached hereto, WVCP and Lessee shall jointly and collectively coordinate with DIG during design of the Project and shall pennit the DIG to participate in the process of preparation of the Preliminary Plans with respect to the Project. WVCP and L~ssee shall jointly and collectively submit the Preliminary Plans, for all or part ofthe Project, for review and response by University in accordance with the procedures outlined in Exhibit S attached hereto. Without limiting the foregoing, where Lessee proposes double occupancy of any residential units such double occupancy shall be noted in any Preliminary Plans submitted to the University with respect to such residential units. If the Preliminary Plans are approved or determined to not require University approval, as outlined in Exhibit S attached hereto, the University will return to Lessee one complete set of the subject Preliminary Plans bearing the University's written

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endorsement, whereupon the subject Preliminary Plans shall then constitute the Certified Preliminary Plans.

(~) Changes to Master Proie~t. As provided in Se~tion 2.4(e) above, Lessee acknowledges that University is neither the party constructing nor does the University control the construction of the Master Project. Without limiting the foregoing, Lessee acknowledges that University is the fee owner of the Master Project Leased Land and, as such, University has certain rights with respect to the review and approval of the Master Project. In connection with the foregoing, University reserves the right, collectively with WVCP, to approve changes to the Master Project at any time, without notice to or the approval of Lessee so long as such chrulge will not (iJ-materially impair acCess to the Leased Land by either Lessee or any Occupant, and/or (ii) change the permitted use of any portion of the Leased Land Area as set forth in Section 4.1 above. In connection with University's exercise of the rights reserved pursuant to this Section 5.3(c), Lessee acknowledges and agrees that no action taken by University pursuant to the· reserved rights set forth in this Section 5;3Cc) shall constitute nor be deemed to constitute grounds for an abatement of any amounts payable to University under the tenns of this Lease or a waiver of any obligations imposed upon Lessee pursuant to the terms of this Lease.

Section 5.4 Plan Review and Permitting Process.

Ca) Plans and Specifications. Les~ee shall submit a sufficient number (not to exceed ten (10) sets) of the Certified Preliminary Plans with respect to the Project to the University for review and approval pursuant to this Section 5.4 and Exhibits D and S attached hereto. Without limiting the generality of the foregoing, the University may disapprove any submittal which is not in conformity with the Development Standards set forth in Exhibit U, attached hereto, or any of the Entitlements Documents.

(b) Procedure for Approval. The University will either approve or disapprove the subject Certified Preliminary Plans within the applicable time frames specified within Exhibit D attached hereto and, if approved, the University will return to Lessee one complete set of the subject Certified Preliminary Plans bearing the University's written endorsement, whereupon such Certified Preliminary Plans shall then constitute a portion of the Plans And Specifications. The University's failure to respond within the applicable time frames specified within Exhibit D attached hereto shall be deemed as its disapproval of the subject Certified Preliminary Plans (or modification, as applicable). If the University disapproves or is deemed to have disapproved of the subject Certified Preliminary Plans, the University shall return to Lessee one set of the subject Certified Preliminary Plans indicating why such submittal was disapproved. In such latter event, the University and Lessee agree to cooperate reasonably with each other in resolving any objections of the other to the subject Certified Preliminary Plans or the University's requested revisions.

Section 5.S Compliance with Applicable Laws. Lessee shall construct the Project and the Delegated Punch List Work, in accordance with Applicable Laws, the,Governmental Authorizations, the University Authorizations, University Regulations and the Entitlements Documents. Lessee shall furnish University willi copies of all certificates and approvals relating to any Work or installation done by Lessee that may be required by any governmental authorities

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with jurisdiction over such Work in connection with the construction of the Project and/or the Delegated Punch List Work, as applicable.

(a) Permits for Improvements. Without limiting the generality ofthe provisions of Section 5.5, Lessee shall be responsible for (i) obtaining all Governmental Authorizations and University Authorizations applicable to the Project, (ii) paying all fees related to the Project, including, all design review and permit fees, and (iii) paying all costs and expense of complying with the requirements of all Governmental Authorizations and University Authorizations applicable to the Project.

(b) University Cooperation. University, in its capacity as lessor under this Lease, will reasonably cooperate with Lessee, at no out-of-pocket cost or expense to University, in obtaining all Governmental Authorizations required to b,e obtained by Lessee pursuant to this Lease. Said cooperation of University, in its capacity as lessor under this Lease, shall include prompt execution by a duly authorized officer of University of such documents and instruments as are reasonably necessary to obtain such Governmental Authorizations. University, in its capacity as lessor under this Lease, may, and, if required by Applicable Laws, shall,join in Lessee's application for any Governmental Authorizations. Notwithstanding the foregoing, (i) in no event shall University be required to cooperate with Lessee in any effort which University reasonably believes either to be (x) illegal, (y) contrary to the terms of the Implementation Plan, or (z) contrary to terms of this Lease, and (ii) nothing herein contained shall limit the rights that University has in connection with any review of the Work and/or the Project conducted pursuant to Section 5.9 and Exhibit D attached hereto, or that University otherwise has in its role as a governmental authority reviewing any request for the grant of any required Governmental Authorizations and/or University Authorizations, or that University otherwise has in its role as the entity promulgating and enforcing any University Regulations.

Section 5.6 Mitigatiop Measures~ Lessee and University shall each perform, or cause to be performed, the mitigation measures which are set forth and allocated to such party in the chart of Mitigation Measure Responsibilities attached hereto as Exhibit M (herein, the "Mitigation Measures Responsibilities"); provided, however, that Lessee and University acknowledge and agree that (i) WVCP shall be obligated to complete those Mitigation Measure Responsibilities identified to be perfonned by WVCP in Exhibit M attached hereto, with the exception of any Sub-Phase Mitigation Obligations (as defined in the Master Lease) which have been delegated to Lessee pursuant to an agreement between WVCP and Lessee, and Lessee hereby assumes the obligation to perform such delegated Sub-Phase Mitigation Obligations, and (ii) the Mitigation Measure responsibilities for which Lessee is obligated to perform hereunder shall be limited to only those Sub-Phase Mitigation Obligations (as defined in the Master Lease) which have been delegated to Lessee pursuant to the agreement between WVCP and Lessee referenced in the preceding item (i). Notwithstanding the foregoing, while the chart of Mitigation Measures Responsibilities reflects obligations with respect to on-site mitigation measures currently required, including those required in the Entitlements Documents, Lessee acknowledges that the chart of Mitigation Measures Responsibilities may not reflect an exhaustive list of all mitigation measures that may be required by any applicable governmental authorities having jurisdiction over the Leased Land in connection with their review and grant of required approvals for development of the Project. Lessee shall, at Lessee's sole cost and expense, comply with all mitigation measures applicable to the Project required pursuant to or in

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connection with the Entitlements Documents and/or any applicable governmental authorities review andlor approval of the Entitlements Documents; provided, however, with respect to any mitigation measures which are imposed after the Effective Date and were not known on the Effective Date, Lessee shall not be obligated to comply with any such new mitigation measures which do not directly and specifically relate to the Project; provided, further however, that Lessee shall have no obligation to comply with any mitigation measures imposed by any appJica\>le governmental authorities in connection with a change to the LRDP which was neither requested by, or otherwise required in connection with changes to the Master Project requested by, WVCP, any Sub-Phase Lessee andlor Lessee.

Section 5.7 Lessee's Contractors. All Work with respect to the Project and the Delegated Punch List Work shall be performed only pursuant to written contracts by competent contracto~ and subcontractors which are duly licensed under the laws of the State ofCalifomia. The general contractor selected by Lessee to perform any Work shall be referred to herein "Lessee's Contractor."

(a) The provisions. of this Section S.7(a) shall apply with respect to all periods prior to Completion of the Project. Prior to entering into a contract with Lessee's Contractor for construct jon ofaH or any portion of the Project and the Delegated Punch List Work, Lessee shall obtain University's written consent, such consent not to be unreasonably withheld, to llie form of the Construction Contract (which may be based upon an industry standard form of contract). The Construction Contract with Lessee's Contractor (A) shall be in the form of a guaranteed maximum price contrac~ and (B) shall provide, (x) that such contractor agrees to indemnify, defend and hold University and the University lndemnitees harmless from any claims, costs, liability or loss resuhing from or arising out of personal injury, death or property damage to the extent either reSUlting from or arising out of the willful misconduct or. negligent acts, error~, or omissions of such contractor, (y) that University is a third party beneficiary of all covenants thereunder in favor of Lessee or its affiliates, and (z) in the event that this Lease is terminated in connection with a Lessee Default hereunder, then at University's election, to be exercised in University's sole and abSOlute discretion, the respective contractor/subcontractor will recognize University as the· assignee of the contract under the same terms and conditions as contained in the subject contract; provided, however, that University shall have no liability or obligation under such contract until University has elected, in a written notice to the subject contractor/subcontractor, to exercise its right to assume the subject contract, and then University's liability shall be limited to obligations arising solely on or after the date of such assumption by University. The contracts between Lessee and Lessee's Architect and Lessee's Engineer shall provide for the conditional assigtunent rights set forth in item (z) immediately above and Lessee shall use commercially reasonable efforts to provide third party beneficiary rights for the University set forth in item (y) immediately above in such contracts. Lessee shall use commercially reasonable efforts to cause all construction subcontracts related to any portion of the Project andlor the Delegated Punch List Work to provide for the indemnity set forth in item (x) immediately above and the conditional assighmetlt rights set forth in item (z) immediately above. University shall not exercise any rights as third party beneficiary under any such agreements prior to a Lessee Default so long as Lessee is diligently pursuing its rights to enforce such contracts in favor of Lessee and, to the extent applicable, University, and that Lessee regularly apprises the University ofthe status of s1;lch enforcement efforts; provided, however, that in all events prior to such Lessee Default, University shall have the right to enforce

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the insurance requirements and provisions under Lessee's Contractor's, Lessee's Architect's, and Lessee's Engineer's contracts. Lessee shall cause all construction contracts between Lessee and Lessee's Contractor to provide that Lessee's Contractor (i) (1) with respect to any Building performed under the contract between Lessee and Lessee's Contractor, warrants the Work to be error free from any latent or patent defects for a period of one (1) year following the substantial completion of the subject Building, or (2) with respect to contracts entered into after Completion of the Project, to the extent commercially reasonably available, warrants the Work to be error free from any latent or patent defects for a period of one (1) year following substantial completion of the subject Work, as applicable, and (ii) agrees to indemnify, defend and hold University and the University Indemnitees harmless from any Claims resulting from or arising out of a breach of the warranties identified in the preceding item (i).

(b) The provisions of this Sectio~ 5.7(b) shall apply with respect to all periods from and after Completion of the Project. The coritract with Lessee's Contractor for any Work shall provide that such contractor agrees to indemnify, defend and hold University and the University Indemnitees harmless from any claims, costs, liability or loss resulting from or arising out of personal injury, death or property damage to the extent either resulting from or arising out ofthe willful misconduct or negligent acts, errors, or omissions of such contractor. In addition, Lessee shall use commercially reasonable efforts to cause all construction subcontracts related to any portion of the Work to provide that that such subcontractor agrees to indemnify, defend and hold University and the University Indemnitees harmless from any claims, costs, liability or loss resulting from or arising out of personal injury, death or property damage to the extent either reSUlting from or arising out of the willful misconduct or negligent acts, errors, or omissions of such contractor.

Section 5.8 Utilities and Other Facilities.

(a) . Cost of Utilities. Except for University Infrastructure Improvements to be constructed by University, all costs associated with bringing required utilities (both temporary and permanent) from the boundary of the Master Project Leased Land (or, with respect to temporary utilities only, from the point of origin) to the point of connection to the Project, including, without limitation, related professional, engineering and consultant fees, service charges, meters, and the costs of connections, including, without limitation, any hook-up fees assessed by any utility company, water district and/or government agency, shall be paid by Lessee, unless otherwise agreed between Lessee and WVCP; provided. however. that University and Lessee each hereby acknowledge that, pursuant to the Master Lease, WVCP is the party tasked with construction of all Infrastructure Improvements. Lessee shall pay to University the costs for domestic water, electricity, sanitary sewer and reclaimed water services. The initial costs charged to Lessee by the University under this Section 5.8(a) shall be as set forth in Exhibit BB. The point of connection for the utilities supplied to Lessee shall be as set forth in Exhibit K. Notwithstanding the foregoing or anything to the contrary herein, (i) Lessee hereby acknowledges that the Leased Land is a portion ofthe Master Project Leased Land which has been previously leased to WVCP for the purpose of development of the Master Project, including, without limitation, construction and installation of the Infrastructure Improvements within the portions of the Access Areas located within the Master Project Leased Land, (ii) Lessee hereby acknowledges and agrees that neither University nor any University Indemnitees have made any representation or warranty as to when or if the Master Project,

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including, without ·limitation, the Infrastructure Improvements, will ever be completed and neither the University nor any University Indemnitees shall have any obligation at any time to construct any portion of the Master Project, including, without limitation, -the Infrastructure Improvements, and (ii) Lessee hereby acknowledges and agrees that no failure by WVCP to perform any of its obligations under the Master Le~se, including, without limitation, any failure to complete construction and installation of the Infrastructure Improvements, shall constitute nor be deemed to constitute grounds for (x) an abatement of any amounts payable to University under the terms of this Lease, or (y) a waiver of any obligations imposed upon Lessee pursuant to the terms of this Lease.

(b) Temporary Utilities. To the extent that Lessee, at any time prior to connection of permanent utilities, desires to utilize utility services fmanced andlor maintained in whole or in part by University, Les,see shall request University's consent thereto, which consent shall not be unreasonably withheld, and Lessee shall pay to University the metered amount for such utility services or; ifnot separately metered, a reasonable charge for such services. Lessee is responsible for all costs of providing such temporary utilities to the Leased Land. Subject to University's consent, temporary utilities may extend beyond the boundaries of the Leased Land and such temporary ut~lities may be located above ground.

(c) . Easements for Lessee's Utilities. Without limiting the obligations of University to grant Lessee requested easements pursuant to Section 4.8(c) above, Lessee shall not enter into any contract. or agreement with any government agency, special district or public utility with reference to sewer, water, gas, telephone, storm drain and other utility lines, landscape improvements, lighting, utility facilities, improvements andlor connections, lines, . . pipes, distribution systems or easements and the like, unless and until University has entered into an easement, license or similar agreement with such party pursuant to Section 4.8(c).above.

Section 5.9 University Inspections. Upon completion of the Delegated Punch List Work, Lessee shall req!lest that University issue a Letter of Completion with respect to the Delegated Punch List Work. Upon final completion ofa Building, Lessee shall request that University issue a. Certificate of Occupancy with respect to the subject Building. The issuance of Certificates of Occupancy shall be governed by the terms and conditions of this Section 5.9 and Exhibit D attached hereto and the Development Standards specified in Exhibit U attached hereto. All inspection services for the Project and the procedures for issuance of Certificates of Occupancy will be conducted in accordance with Exhibit D attached hereto. All inspections of Work performed prior to Completion of the Project shall be conducted in a reasonable, timely and cost effective manner to determine that the design, materials, workmanship, equipment, and assemblage techniques are in accordance with Applicable Laws, Governmental Authorizations, University Authorizations, University Regulations, the Entitlements Documents and the Plans And Specifications. In connection with inspections of Work performed prior to Completion of the Project, the University Inspectors shall at all reasonable times with reasonable prior Notice to Lessee, except no Notice shall be required in the case of emergencies, have access to the site where Work is being performed, and Lessee shall provide safe and proper facilities for such access and for inspection; prgvided. however, that in connection with any such action, the University Inspectors shall comply with the reasonable health, safety and security requirements of Lessee andlor Lessee's Contractor. To the extent not otherwise accommodated by WVCP or any other Sub-Phase Lessee upon any other portion of the Master Project Leased Land, such

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facilities shall include a lockable room in the field office containing approximately 150 square feet. Notwithstanding the foregoing, as a condition to University's obligation to inspect the Buildings in connection with issuance of a Certificate of Occupancy, Lessee shall cause aU of Lessee's consultants listed on Exhibit Nto provide a written statement to University stating that the subject consultant has reviewed the Work performed with respect to the Building and found it to be in substantial conformance with the Plans And Specifications and designed in accordance with the Development Standards specified in Exhibit U.

(a) Non-Conformance. Should any of the University Inspectors observe any Work which such party reasonably believes does not comply in all material respects with Applicable Laws, Governmental Authorizations, University Authorizations, University Regulations, the Entitlements Documents andlor the Plans And Specifications, University shall notifY Lessee, and University may pursue any of its remedies under this Lease, including, without limitation, the remedies set forth in this Section 5.9 or those set forth in Section 15.3 below.

(b) Correction by Lessee. Lessee shall, at Lessee's sole cost and expense, promptly after receipt of University's notice of material non-conformance pursuant to Section 5.9(a) above, correct any such non-conformance noted by the University Inspectors to the extent necessary to cause the Project andlor the Delegated Punch List Work to comply with Applicable Laws, University Regulations, Governmental Authorizations, University Authorizations, the Entitlements Documents andlor the Plans And Specifications.

) (c) Disclaimer. Neither the University Inspectors' inspection of any Work nor University's approval of any Work nor the approval of any plans or submissions presented by Lessee or its employees, agents or contractors, including, without limitation, the Plans And Specifications, shall constitute an opinion or warranty by University or any ofthe University Inspectors of their adequacy, nor shall it make University responsible for Work with respect to which an approval is given or for any defect or deficiency with respect to any Work andlor the Plans And Specifications.

(d) Notice of Completion. Within five (5) days after the Completion of any component of the Project andlor the Delegated Punch List Work, as applicable, which component is eligible for such treatment, Lessee shall file or cause to be filed a notice of completion as defined and provided for in California Civil Code Section 3093.

(e) Nonresponsibilitv. University shall not be deemed to have incurred or assumed any obligation or responsibility in connection with any Work. Nothing in this Lease nor any act or failure to act on the part of University shall be construed as a warranty or representation as to the adequacy or fitness of the Project andlor the Delegated Punch List Work or as a waiver of a claim by University for any defect or deficiency with respect to the Project, the Development Documents or of the Work.

Section S.10 As-Built Plans. Within ninety (90) days after Completion of the Project, Lessee's Architect andlor Lessee's Engineer, as applicable, shall, at no cost to University, furnish a complete set of "as-built" record documents, as follows:

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(a) Record Drawings. Three sets of Bond prints bearing agency signatures, and a set on CD-ROMs, formatted in Adobe Acrobat .pdt; and AutoCad dwg. Lessee's Architect and/or Lessee's Engineer shall "bind" all plot sheets. Each drawing shall be titled with the same title and number as the original sheet.

(b) Specifications in CSI Format. One annotated hard copy and a version on CD ROM, formatted in Microsoft Word, Office 97 version or later. Each specification section shall be saved by file (i.e., 15400.doc, 15950.doc).

The record drawings shall be made from the "As-Built" set of drawings kept by Lessee's Contractor, including revisions and changes made during the course of construction based on marked-up prints and other data furnished to Lessee's Architect and/or Lessee's Engineer, as applicable, by Lessee's Contractor. Revisions and changes shall be accurately annotated and cross-refer~nced. Bach page of the record drawings .shall prominently note the words "Record Documents." The cover page of the annotated Plans And Specifications shall also note the words "Record Documents." The Record Documents shall only be used in connection with the operation, maintenance and repair of the Project.

Section 5.11 Ownership of Buildings. All Buildings shall be owned by Lessee until the Term Expiration Date, or the earlier tennination oftms Lease in accordance with its terms .

. Section 5.12 Maintenance of Leased Land and Proiect. During the Term of this

Lease Lessee shall, at Lessee's sole cost and expense, maintain the Leased Land in a good, clean, attractive and sanitary and safe order, condition, habitability and repair, taking into consideration the nature of Lessee's obligations hereunder with respect to the construction and subsequent maintenance and operation of the Project. Lessee's maintenance obligations shall include (i) the obligation to maintain all unimproved areas within the Leased Land in good condition and perform erosion and dust/dirt control m~ures with, respect to such unimproved areas (including, without limitation, hydroseeding sufficient to prevent any material adverse impact to any real property adjoining the Leased Land), (ii) the obligation to maintain the Buildings in a fust class condition and otherwise in good, clean, attractive, sanitary and safe order, condition, habitability and repair, (iii) the obligation to manage and operate the Project in accordance with the Property Management Standards. (iv) the obligation to comply with and perform all of the terms, covenants and conditions of the OREA(s), if any, as they relate to the Leased'Land andlor the Project, and (v) the obligation to cause the Project to comply with all Applicable Laws, Governmental Authorizations, University Authorizations and University Regulations related to the construction of the Project and/or the operation of the Project. Prior to Completion ofthe Project, such maintenance obligation shall include, without limitation, the obligation to perform regular job-site cleaning and street sweeping.

Section 5.13 Pre-ConditiOns to Commenting Work.

(a> Notwithstanding anything to the contrary herein, no Work of any kind with respect to the initial construction of the Project shall be commenced on, and no building or other materials shall be delivered to, the Leased Land or any part thereof, until:

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(i) University has received a duly executed original of the Guaranty, in the form set forth in Exhibit E and has received duly executed originals of the Joint Financing Guaranty, in the form of Exhibit F, executed by each of the Joint Financing Guarantors;

(ii) University has received executed copies of the Construction Contract and been afforded the opportunity to take all necessary actions under California Civil Code section 3094, including posting ofa notice of non-responsibility at the Leased Land;

(iii) all of the grading plans have been approved i~ writing by University pursuant to Section 5.4 above;

(Iv) Lessee has obtained all of the Governmental Authorizations and University Authorizations which are necessary to commence such grading Work and Lessee has paid all fees which are necessary to commence such Work;

(v) Lessee has provided University with duly executed copies of the Construction Contract covering the Work, which Construction Contract shall comply with the requirements of this Lease;

(vi) University has been provided, at Lessee's option, either (x) evidence, reasonably satisfactory to University, that Lessee has funds sufficient to, and which are immediately available to Lessee for, the pwposes of funding the construction of the Project, or (y) an original of the Performance Guaranty in the form of Exhibit F-3 attached hereto, duly

) executed by Guarantor;

(vii) Lessee shall have obtained and shall maintain until Completion of the Project, the insurance required pursuant to Article IX below; provided, however, if the Delegated Punch List Work has not been completed at the time of Completion of the final Building to be constructed as a portion of the Project, then Lessee shall, until Completion of the Delegated Punch List Work, continue to maintain the insurance required pursuant to Section 9.2 below, (other than the insurance set forth in Section 9.2(d)(i) below) with respect to the Work being performed in connection with Completion of the Delegated Punch List Work;

(viii) Lessee, Sub-Phase Lessee, if any, and WVCP shall have entered into the OREA(s), if applicable; and

(a) Lessee and the Sub-Phase Lessees who are leasing the other portions of the Student Housing Area shall have entered into the Shared Use Agreeme~t, in a form reasonably acceptable to University, which shall permit such Shared Use Agreement to be assumed by the University, in the exercise of the University's sole discretion, as provided in Section 2.4(t) above, and shall otherwise be consistent with the terms of Section 2.4(t) above.

Upon satisfaction of the requirements set forth above, Lessee may commence construction of the Project; provided, however, that University may, in the exercise of University's sole and absolute discretion, exercisable by written notice to Lessee (herein a "Stop Work Notice") require all work to be immediately halted if either of the following conditions are not satisfied within the respective time periods for performance set forth below:

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(1) Within ten (10) days following the mutual execution and delivery of this Lease, Lessee shall have constructed a perimeter fence enclosing the Leased Land, in a manner to be determined by Lessee after consultation with University; or

(2) Within sixty (60) days following the mutual execution and delivery of this Lease, Lessee shall have provided to University executed copies of the Project Financing Documents which shall comply with the requirements of this Lease, but may reflect redaction of certain terms as more particularly set forth in the Right of Redaction described in Section 16.2 below.

Lessee acknowledges that, pursuant to the terms of the Master Ground Lease, the requirements set forth in items (1) and (2) were originally agreed to be performed prior to the commencement of construction of any portion of the Project. However, as an accommodation to Lessee, University has agreed to delay the perforinance of the above conditions set forth in items (1) and (2) for the respective time periods stated therein and, as material consideration for UniversitY'S agreement to permit such delayed performance, Lessee agrees to immediately stop all work, if University provides a Stop Work Notice and to not commence any further work until the respective condition set forth in items (1) and (2) giving rise to delivery of such Stop Work Notice has been satisfied and University has thereafter delivered written notice to Lessee (herein a "Recommencement or Work Notice") permitting Lessee to recommence construction of the Project. Lessee hereby acknowle~ges and agrees that neither the delivery of a Stop Work Notice nor any delay in the work arising in «onnection therewith nor any delay in delivery of a Recommencement Of Work Notice shall constitute and event of Force Majeure for purposes of this Lease.

(b) Notwithstanding anythirig to the contrary herein, from and after the Completion of the Project, no Work shall be commenced on, and no building or other materials shall be delivered to, the Leased Land or any part thereof with respect to any such Work, until:

(i) at least ten (10) days after written notice has been given by Lessee to University of the proposed commencement of Work or the delivery of such materials in order to permit University to take all necessary actions under California Civil Code section 3094, including posting of a notice of non-responsibility at the Leased Land;

(ii) with respect to any Work for which the issuance ofa permit is required, all of the Plans And Specifications for such Work have been approved in writing by University pursuant to Section 5.4 above, if applicable;

(iii) Lessee has obtained all of the Governmental Authorizations and University Authorizations which are necessary to COmmence such Work, if any, and Lessee has paid all fees which are necessary to commence such Work, ifany; and

(iv) Lessee·shall have obtained and shall maintain until completion pf the subject Work. the insurance required pursuant to Article IX below.

Upon satisfaction'ofthe requirements set forth above, Lessee may commence any such Work.

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ARTICLE VI MISCELLANEOUS OPERATIONS ITEMS

Section 6.1 Capital Reserves. Commencing -upon the first (1 Bt) anniversary of the issuance of a Certificate of Occupancy with respect to a Building, and continuing on the first (1 SI) day of each calendar month during the Term thereafter, respectively, Lessee shall m~e a monthly deposit into a segregated cash account (herein, the "Capital Reserve Account") of a portion of the revenues from operation of the Project to be used for capital improvements; provided, however, in no event shall any individual monthly deposit by Lessee pursuan~ to this sentence be less than one twelfth of the applicable Capital Reserve Threshold measured immediately prior to such month. As used herein, the term "Capital Reserve Threshold" shall mean an amount equal to the product of (i) a fraction the numerator of which is the CPI Index last published prior to the applicable month of the Tenn, and the denominator of which is the CPI Index last published prior to May 1, 2006, muhiplied by (ii) the product of (x) Two Hundred Fifty Dollars ($250.00), multiplied by (y) the number of Apartments within each Building which has reached Completion as of the date of such measurement. Funds within the Capital Reserve Account shall be used solely for payment of Capital Expenditures. As used herein, the term "Capital Expenditures" shall mean any item of expense that, according to GAAP, is not properly treated as a current expense on the books of the Lessee, but rather should be capitalized; provided, however, that Lessee and University agree that, irrespective of any treatment thereof under GAAP, for the purposes of this Section 6.1 the following items shall constitute a "Capital Expenditures": (1) replacement (as opposed to repair) of carpeting, (2) exterior painting of any Building (excluding touch up repair), (3) replacement of roof membrane, and (4) replacement of kitchen and bathroom appliances and fixtures.

(a) Lessee shall provide University with quarterly statements from the segregated Capital Reserve Account and, within ninety (90) days following the end of each calendar year, an accounting of the disbursements of funds from the Capital Reserve Account, and the respective uses of such funds, during the prior calendar year. In addition, ~mmencing upon the Completion of the Project and every five (5) years thereafter, Lessee shall provide University with a capital reserve study with respect to the Project

(b) University, at its sole cost, shall have the right to review and audit the books and records of Lessee for the sole purpose of detennining the accuracy of the statements of the uses offunds delivered by Lessee pursuant to the Section 6.1(a) and compliance with the terms of this Section 6.1. Both University and University's accounting firm shall keep any information gained from review of the books and records of Lessee and Guarantor confidential and shall not make copies of, shall not remove and shall not disclose to any other party the contents of any such books and records, except that University may disclose such information to a trier of fact in the event of any dispute between University and Lessee with regard to compliance with the provisions of this Section 6.1, or as otherwise may be required by any state or federal laws, statutes, codes, rules, regulations, ordinances, requirements, or order

Section 6.2 Additional Maintenance Obligations. During the Term of this Lease Lessee shall, at Lessee's sole cost and expense, perform the maintenance and repair obligations with respect to the Master Project identified in Exhibit C attached hereto. The obligations set

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forth in Exhibit C shall be in addition to, and not in lieu of, the obligations of Lessee set forth elsewhere in this Lease.

Section 6.3 Commercial Subleasing. Unless otherwise agreed by University, in the exercise of University's sole and absolute discretion, any Commercial Sublease (other than a University Sublease) shall be subject to the use restrictions set forth in Exhibit Yattached hereto. If Lessee enters into a Commercial Sublease with any party other than WVCP, any Affiliate andlor any Related Entity and such Commercial Sublease does not violate any of the provisions of this Lease and otherwise contains reasonable and customary terms and conditions, then upon the written request of Lessee, University shall enter into a subordination, non-disturbance and attornment agreement (on University's standard form or such other form as University may approve in its reasonable discretion) with the sublessee under such Commercial Sublease. As used herein, the tern'l "Related Entity" shall QleaD (i) a parent, subsidiary or affiliate of either Lessee or Guarantor, (ii) a corporation controlling, controlled by or under common control with either Lessee, Guarantor or any of the entities identified in item (ii), or (iii) an entity resulting from a merger, consolidation or reorganization of Lessee or Guarantor.


Section 6.S Priority To Student Otcupaney Of Student Beds. Unless otherwise agreed by University, in the exercise ofU~iversity's sole and absolute discretion, Lessee shall offer each Student Bed for sublease pursuant to the offering procedures set forth in Exhibit Z attached h~reto.

ARTICLEvn LEASE CONSIDERATION

Section 7.1 Basic Rent. Commencing upon the Basic Rent Commencement Date and continuing thereafter throughout the Term, Lessee shall p~y to University annual rent (herein "Basic RentU

) in an amount equal to Ninety-One thousand Six Hundred Sixty-SiX And 6711 Oaths Dollars ($91,666.67); provided. however. that (i) for'the initial twelve (12) month period following the Basic Rent Commencement Date, Basic Rent shall be Twenty-Two Thousand Nine Hundred Sixteen And 67/10Otbs Dollars ($22,916.67), (ii) commencing on the first anniversary of the Basic Rent Commencement bate and continuing for the twelve (12) month period thereafter, Basic Rent shall be Forty-Five Thousand Eight Hundred Thirty-Three And 34/100ths Dollars ($45,833.34), (iii) commencing on the second anniversary of the Basic Rent Commencement Date, the Basic Rent shall be the amount stated above, (iv) commencing on the third anniversary of the Basic Rent Commencement Date and each anniversary thereafter occurring prior to the Basic 1{ent Adjustment Date, the Basic Rent shall be increased to be an amount equal to the then current Basic Rent payable for the period immediately preceding the subject anniversary of the Basic Rent Commencement nate multiplied by One And Five One Thousandths (1-.005), (v) on the Basic R~nt Adjustment Date, the ;Basic Rent shall be increased to be an amount equal to One Hundred Sixteen thousand Six Hundred Sixty-Six And 6711 Oaths Dollars ($116,666.67); and (vi) commencing on the first anniversary of the Basic Rent Adjustment Date and each anniversary thereafter occurring prior to the Term Expiration Date, the Basic Rent shall be increased to be an amount equal to the then current Basic Rent payable for the period immediately preceding the subject anniversary of the Basic Rent Adjustment Date

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multiplied by One And Five One Thousandths (1.005). The Basic Rent shall be payable in one (1) annual installment on January 15t of each year during the Term, without abatement (except as and when expressly provided herein). offset, rebate, credit or deduction for any reason whatsoever; provided. however. (x) the Basic Rent for any fractional year immediately following the Basic Rent Commencement Date shall be a prorated amount ofthe Basic Rent stated in item (i) above based upon a three hundred sixty five (365) day year, which prorated amount shall be payable on the Basic R~nt Commencement Date, and (x) if the Term Expiration Date is a day other than December 31st, then the Basic Rent payable on January 15t of the fractional year which includes the Term Expiration Date shall be a prorated amount of the then current Basic Rent based upon a three hundred sixty five (365) day year.

Section 7.2 Municipal Fees Amount.

(a> Prior To Issuance Of A Certificate Of Occupancy. From and after the Commencement of Construction Date, Lessee shall pay to University monthly fees (herein, the "Municipal Fees Amount (Construction Phase)") with respect to each Building which is to be constructed as a portion of the Project (irrespective of whether or not the construction of such Building has been commenced, but without duplication of any Building which is the subject of payment ofthe Municipal Fees Amount set forth in Sedion 7.2(b) below) for the provision of fire and police service to the Leased Land in the amounts set forth in Exhibit CC attached hereto; provided. however. commencing upon the first Adjustment Date following the Effective Date, the amount of the Municipal Fees Amount (Construction Phase) payable with respect to all periods from and after the respective Adjustment Date shall be increased to be a dollar amount calculated by multiplying the dollar amount specifie4 in Exhibit CC by a fraction, the numerator of which is the CPI Index last published prior to the subject Adjustment Date, and the denominator of which is the CPI Index last published prior to February 1,2007. Commencing upon the Commencement of Construction Date and continuing thereafter during the Term until the Completion of the Project, the Municipal Fees Amount (Construction Phase> shall be payable with respect to all Buildings which have not yet reached Completion (irrespective of whether or not construction has commenced as of the date of such payment with respect to any such Building), in advance on or before the first day of each calendar month, without abatement, offset, rebate, credit or deduction for any reason whatsoever. The Municipal Fees Amount (Construction Phase) shall be payable in addition to any Municipal Fees Amount payable with respect to any Building which has reached Completion.

(b) After Issuance Of A Certificate OfOecupancy. Upon the Completion of a Building, in addition to any Municipal Fees Amount (Construction Phase) payable with respect to any Building which has not yet reached Completion, Lessee shall pay to University monthly fees (herein, the ''Municipal Fees Amount") with respect to each Building which has reached Completion for the provision offire and police service to the Leased Land in the amounts set forth in Exhibit CC (lttached hereto; provided, however, commencing upon the first Adjustment Date following the Effective Date, the amount of the Municipal Fees Amount payable with respect to all periods from and after the respective Adjustment Date shall be increased to be a dollar amount calculated by multiplying the dollar amount specified in Exhibit CCby a fraction, the numerator of which is the CPI Index last published prior to the subject Adjustment Date, and the denominator of which is the CPI Index last published prior to June 1,2006. Commencing upon the Completion of each Building and continuing thereafter

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during the Term, Municipal Fees Amount shall be payable with respect to such Building, in advance on or before the first day of each calendar month, without abatement, offset, rebate, credit or deduction for any reason whatsoever.

S~tion 7.3 Inspection Fees. Lessee shall pay the University the amounts set forth in Exhibit R attached hereto (such amounts herein, the "Inspection Fees") as compensation for the costs a,nd ,expenses which will be incurred by the University of california, Davis in connection with plan checking, construction inspections (including, inspections conducted by University's Inspectors), and University of Cali fomi a, Davis project management, support and reviews and any and all other University inspections and all plan checking, campus project management, campus support and review, permit fees and similar payments under this Lease. The Inspection Fees applicable to each Building shall be payable by Lessee with respect to such Building upon the date University issues a permit or other similar notice to Lessee entitling Lessee to commence construction of such Building. Notwithstanding anything to the contrary herein, except as provided below with respect to re-inspections of materially deficient Work, Lessee's liability to University for payment of Inspection Fees shall not exceed the Inspection Fee Cap; provided, however. that the Inspection Fee Cap shall include costs of obly otle (1) re-inspection by University's Inspectors in connection with any Work the University's Inspectors have identified as materially deficient. In the event that Work continues to have material deficiencies, as noted 'by University's Inspectors, following the first re-inspection of such Work by University's Inspectors which is conducted after Lessee notifies University's Inspectors that the previously identified material deficiencies in the Work have purportedly \leen corrected, then Lessee shall be responsible, at its sole cost and expense, for reimbursement of all costs incurred for University's Inspectors to subsequently re-inspect the Work after the University's Inspectors have identified any material deficiencies therein on such first re-inspection and any reimbursement for such subsequent re-inspection shall not be subject to or included within the computation of amounts paid pursuant to the Inspection Fee Cap. Costs for re-inspection services, beyond the first (1 s~ such re.inspection, shall be computed based upon the then applicable time and materials rates and shall be payable to University within thirty (30) days following Notice. Nothing in this Section 7.3 shall affect or diminish the University's regulatory authority to require compliance with all Applicable Laws, University Regulations, th~ Entitlements Documents and the provisions of this Lease.

Section 7.4 FF&E. Development Documents and Development Agreements. Lessee hereby grants University a security interest in all FF&E, the Development Documents and all Development Agreements as security fotLessee's performance under this Lease, including, without limitation, the obligation to construct the Buildings, as provided in Section 5.1 above, which security interest shall be subordinate to the lien of the Project Financing Documents and any conditiona\ sale or other purchase money security interest incurred in connection with Lessee's acquisition of items ofFF&E. In connection with the preceding sentence, University shall 'execute all reasonable documents which are reasonably requested by Lessee or Leasehold Mortgagee to evidence and effectuate such subordination. Lessee will not assign, pledge, encumber, or otherwise grant a security interest in the FF&E, the Development Documents and the Development Agreements to or ,in favor of any other person or entity, other than the Leasehold Mortgagee pursuant to the Project Financing Documents. In order to enable University to perfect its security interest in the FF &E, the Development Documents and the Development Agreements, Lessee shall cooperate with University in filing a financing statement

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in the form attached hereto as Exhibit 0 to be filed in University's favor, and in obtaining consents from parties to the Development Documents and the Development Agreements in the form attached hereto as Exhibit P. Upon termination of this Lease, Lessee shall (i) execute such documents and agreements as shall be reasonably required by University to convey to University, or to a third party named by University, Lessee's right, title, and interest in any and all Development Documents and all Development Agreements which University elects to have so conveyed; and (ii) deliver any and all Development Documents and Development Agreements to University.

Section 7.5 Other Payments. Lessee agrees to pay, as additional consideration for the Leased Land, within thirty (30) days after University's demand therefore (unless another time for paYment is set forth in this Lease) all other amounts and sums which Lessee is obligated to payor reimburse to University under the provisions ofthis Lease.

Section 7.6 Net Lease. The parties hereto have assumed that University will not have to pay any expense or incur any liabilities of any kind in any way relating to, or in connection with, the Leased Land or the Project during the Term, except as otherwise expressly provided herein. In connection with the foregoing, Lessee hereby assumes the obligation to make all payments of fees, costs and expenses in connection with the ownership, operation and maintenance of the Leased Land and the Project that arise or accrue during the Term. Without limiting the generality of the foregoing, Lessee, on behalf of itself and its affiliates, partners, trustees, beneficiaries, shareholders, members, managers, directors, officers, employees and agents, and their respective heirs, successors, personal representatives and assigns, hereby acknowledges and agrees that, with the exception of construction of the University Infrastructure Improvements and costs and expenses related to the ownership, operation and maintenance of the Delivered Infrastructure and Access Areas (other than the portions thereof pontained within the' Master Project Leased Land which are the obligation ofWVCP, any Sub-Phase Lessee or Lessee and not the obligation of University hereunder), under no circumstances or conditions, whether now existing or hereinafter arising, and whether within or beyond the present contemplation of University and/or Lessee, shall University or any other University Indemnitees be expected or required to make any payment of any kind whatsoever with respect to the Leased Land or the Project, including, the Buildings, or have any obligation or liability with respect to the Leased Land and/or the Project, including, the Buildings, except as and to the limited extent expressly so provided elsewhere in this Lease. By way of illustration, but not limitation, Lessee, on behalf of itself and its affiliates, partners, trustees, beneficiaries, shareholders, members, managers, directors, officers, employees and agents, and their respective heirs, successors, personal representatives and assigns, hereby acknowledges and agrees that, Lessee shall be solely responsible for payment, at Lessee's sole cost and expense, of any costs of insurance premiums, deductibles, debt service, reserves, permit and license fees, costs and utilities, design, construction, maintenance, repair, replacement, rebuilding, Restoration, management, marketing, services, operations, taxes and other costs of any type whatsoever accruing at any time during the Term or any holdover period in connection with the development, ownership, marketing, leasing, operation, management, maintenance, repair, replacement, Restoration, use, occupancy or enjoyment of the Leased Land and/or the Project. Lessee shall pay all such costs and expenses directly and shall contract directly for all required services, utilities and other items referred to herein. .

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ARTICLEVIll TAXES AND ASSESSMENTS

Section 8.1 Taxes and Assessments. Lessee has assumed that Lessee's Interests will not be subject to property or possessory use or interest taxes. However, the University. has informed Lessee that the taxing authority may seek to assess the Project for property or possessory use or interest taxes. Accordingly, during the Term Lessee shall pay, prior to the delinquency date thereof all Taxes and Assessments, if any, which may be levied, assessed, charged or imposed, or may become a lien or charge upon the Leased Land, Lessee's Interest and/or any portion of the Project ouring any portion of the period to which the subject Taxes or Assessments, as applicable, applied. Unless Lessee exercises its right to contest payment pursuant to Section 8.3 below, Lessee shall pay the actual amount of all Taxes and Assessments directly to the appropriate taxing authorities. In connection with the foregoing, Lessee shall promptly provide University with a copy of any notice of Taxes and/or Assessments and the related bill for the Leased Land and/or Lessee's Interest received by Lessee together with a copy of evidence of payment of such bill by Lessee. Without limiting Lessee's obligations under this S~ction.8.1, Lessee shall diligently pursue any available exemptions to Taxes and Assessments based on the use of the Leased Land. University shall reasonably cooperate with Lessee using commercially reasonable efforts to pursue such exemptions; provided, however, that University shall not be obligated to pursue administrative or judicial proceedings or incur third party costs and expenses.

Section 8.2 Liens and Delinquencies. Lessee shall prevent any Tax or Assessment required to be paid by Lessee from becoming a delinquency lien upon the Leased Land, the Project or any part thereof. The University Indemnitees shall in no way be obligated to pay such deIfnquent Taxes and Assessments, but, if Lessee fails to cure such default with respect to the payment of Taxes and Assessments within the cure period set forth in Section 15.1(b) below, or contest such Tax or Assessment pursuant to Section 8.3 hereof, then, in addition to the remedies set forth in Section 15.3 below, Lessee authorizes UniversitY to make such payment for the account of Lessee, provided that University provides Lessee with five (5) Business Days prior written notice of its intent to do so. Any amounts so paid by University shall become immediately due and payable to University by Lessee and shall bear interest at the rate provided in Section 21.13 below from the date of payment by University to date of repayment by Lessee.

Section 8.3 Lessee's Right to Contest. Lessee shall have the right, at its own expense, to contest the amount or validity of any Tax or Assessment by appropriate proceedings diligently conducted in good faith. As a condition precedent to Lessee's contesting any Tax. or Assessment, Lessee shall (i) comply witli Applicable Laws respecting such contest, (ii) give University Notice of Lessee's intent to so contest said amount or validity, and (iii) in order to protect University from any sale Or foreclosure against the Leased Land or any part thereof, provide, prior to the 4te required to prevent any foreclosure against or sale of the Leased Land, a good.and sufficient surety bond or other security deemed appropriate by University in the amount of such Tax. or Assessment plus estimated penalties which may be imposed. Without limiting University's obligation to cooperate with Lessee in Lessee's pursuit of applicable Tax exemptions pursuant to Section 8.1 above, University shall reasonably cooperate, at Lessee's sole cost and expense, with Lessee in any such contest of the amount or validity of any Tax or Assessment;" provided, however, that University shall not be obligated to pursue any

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administrative or judicial proceedings and University shall not.be required to incur any third party costs and expenses in connection with such cooperation. Lessee shall bear any and all costs, liability or damage, including attorney's fees and costs arising out of such contest.

Section 8.4 Replacement Taxes. If at any time during the Term the basis of real property taxation prevailing at the commencement of such Term shall be altered so that in addition to, or in lieu of, or as a substitute for, the whole or any part of the real property taxes now levied, assessed or imposed against the Leased Land, there shall be levied, assessed or imposed upon or against University a tax on rents, a Lease fee measured by rents, a so-called ''value added tax," or any other tax in lieu or fee resulting from a revision of the present real property tax laws, then and in any such event the same shall be included and deemed within the meaning and purview of the term "Taxes" and Lessee shall be responsible for that portion of any such tax or fee equal to the amount that would have been levied, assessed or imposed on University assuming the Leased Land constituted all of University's real property.

Section 8.5 Survival. Lessee's obligations and liabilities pursuant to the provisions of this Section 8.5 shall survive the expiration or earlier termination of this Lease.

ARTICLE IX INSURANCE

Section 9.1 Property Insurance.

(a) Builder's Risk Insurance. At all times during the Term prior to the Completion of the Project, Lessee shall keep the Buildings which are under construction insured by an all-risk Builder's Risk (Course of Construction) insurance policy for one hundred percent (100%) of the replacement cost of all materials and equipment to be furnished for the

. Work whether or not located on or in the Leased Land. Any such insurance shall insure against direct physical loss or damage by fire, lightning, wind, storm, explosion, collapse, underground hazards, vandalism, malicious mischief, glass breakage and such other causes as are covered by such form of insurance. Such policy(ies) shall include (a) an endorsement for broad form property damage, demolition costs and debris removal, (b) a "replacement cost endorsement" in amount sufficient to prevent Lessee from becoming a co-insurer under the terms of the policy, but in any event in an amount not less than 100% of the then full replacement cost,.and (c) an endorsement to include coverage for budgeted soft costs. The University (together with its officers, directors, members, shareholders and employees), Lessee's Contractor and its subcontractors shall each be named as an Additional Insured. The replacement cost coverage shall be for work performed and equipment, supplies and materials furnished on the Leased Land and for the Project, as the case may be, or to any bonded warehouse for storage pending incorporation into the Work, without deduction for physical depreciation and with a deductible not exceeding Fifty Thousand Dollars ($50,000.00) per occurrence. In addition, nothing in this Section 9.1 shall be construed to relieve Lessee of full responsibility for loss of or damage to materials not incorporated in the Work, and for Lessee's or its contractors' tools and equipment used on or in Leased Land and in connection with the Project, or elsewhere, or to relieve Lessee of its responsibilities referred to under this Section 9.1.

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{b) Property Insurance. Upon Completion of the first Building, and upon Completion of each subsequent Building thereafter, Lessee shall maintain a "Causes of Loss -Special Form" property insurance policy covering such Buildings, m an amount equal to not less than 100% ofthe then-current full replacement cost of the Building(s) being insured pursuant thereto (including building code upgrade coverage but excluding the cost of any foundations, pilings, excavations and footings with respect to the applicable Building(s» with any deductible notto exceed Fifty Thousand' Dollars (550,000.00), applied to each Building on a Building by Building basis. Any such insurance shall insure against direCt physical loss or damage by fire, lightning, wind, storm, explosion, collapse, underground hazards, vandalism, malicious mischief, glass breakage and such other causes as are covered by such fom of insurance. In addition, if the "probable maximum loss" (or the equivalent standard at the time customarily used by the insurance industry in determining the maximum likely exposure of property to risk of damage from earthquakes) exceeds 20% of the then full replacement cost of the Project (as determined by a third party consultant selected by Lessee and approved by University in its reasonable discretion), then such insurance shall also insure against direct physical loss or damage by earthquake. Such policy(ies) shall include (a) an endorsement for broad fom property damage, boiler and machinery damage, demolition costs and debris removal, and (b) a "replacement cost endorsement" in amount sufficient to prevent Lessee from becoming a co-insurer under the terms of the policy, but in any event in an amount not less. ttum 100% of the then full replacement cost. The University (together with its officers, directors, members, shareholders and employees) shall be named as an Additional Insured.

Section 9.2 Liability Insurance-Lessee and Lessee's Contractor and Subcontractors. Lessee further agrees (i) at all times'durmg the Temt t6 maintain in full force and effect the insurance identified in it.ems (a), (b)(i), (b)(iii), (b)(iv) and (c) below; (ii) during the perfomance of any Work, (x) to cause Lessee's Contractor hired by Lessee in connection with the construction of any part of the Project and/or the Delegated Punch List Work to procure and continuously maintain in full force and effect the insur8:nce identified in items (a), (b)(i), (b)(iii), (b)(iv) and (c) below, and (y) to include in its contracts with, Lessee's Contractor a requirement that any subconp-actors procure and maintain in full force and effect during any period in which any such party is performing any Work, the insurance identified in items (a), (b)(i), (b)(iii), (b)(iv) and (c) below; and (iii) to ~aintain in fuJI force and effect, or to cause Lessee's Contractor to maintain in full force and eff~t, the insurance identified in items (b)(ii) and (d) below, during the times required in such Sectio~; in each case, to cover such party's respective activities in connection with this Lease, the Leased Land, the Project and/or the Delegated Pwich List Work for bodily injury, perso.naI injury and property damage:

(a) Business Auto Liability. For autos owned, hired, scheduled or non-owned with a combined single limit rio less thattOne Million Oollars ($1,000,000.00) per occurr~nce;

(b) Commercial General Liability.

(i) General Aggregate (Bodily Injury, Property Damage): Ten Million Dollars ($10,000,000.00).

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(ii) Product/Completed Operations Aggregate: Ten Million Dollars ($10,000,000.00); provided that such insurance shall continue to be maintained for a period of ten (10) years from the Completion of each Building.

(iii) Personal and Advertising Injury: Five Million Dollars ($5,000,000.00).

(iv) Each Occurrence: Five Million Dollars ($5,000,000.00).

Notwithstanding the foregoing items (i) through (iv) ofthis Section 9.2(b), (X) for subcontractors the minimum policy limits in this Section 9.2(b) shall be reduced to One Million Dollars ($1,000,000.00) Each Occurrence, Two Million Dollars ($2,000,000.00) General Aggregate and Two Million Dollars ($2~000,OOO.00) Product/Completed Operations Aggregate (provided, that Product/Completed Operations coverage shall not be required to be maintained by subcontractors with respect to Work performed from and after Completion of the Project), and (Y) for Work performed by Lessee's Contractor following Completion ofthe Project having an aggregate value of less than Two Hundred Fifty Thousand Current Dollars ($250,000.00) the minimum policy limits in this Section 9.2(b) shall be reduced to Two Million Dollars ($2,000,000.00) Each Occurrence, Five Million Dollars ($5,000,000.00) General Aggregate and Two Million Dollars ($2,000,000.00) Product/Completed Operations Aggregate (provided, that Product/Completed Operations coverage shall not be required to be maintained by Lessee's Contractor with respect to Work performed from and after Completion of the Project having an aggregate value of less than One Hundred Thousand Current Dollars ($100,000.00».

(c) Worker's Compensation. Workers' Compensation insurance, in an amount and form sufficient to meet all applicable governmental requirements, and Employer's Liability coverage with limits of not less than One Million Dollars ($1,000,000.00) for bodily injury or death to anyone or more persons per accident, One Million Dollars ($1,000,000.00) bodily injury by disease each employee, and One Million Dollars ($1,000,000.00) policy limit for bodily injury by disease. Such policies shall cover all persons providing labor or services to or on behalf of such policy holder (as applicable) Lessee, Lessee's Contractor, subcontractors and Lessee consultants and risks to such persons for claims arising out of construction, use or occupancy of Leased Land andlor repair of or entry onto the Leased Land.

(d) Pollution Liability.

(i) Lessee shall procure and maintain, until the Completion of the Project, Pollution Legal Liability Insurance on a claims-made basis with minimum limits of Five Million Dollars ($5,000,000.00) for each loss and Five Million Dollars ($5,000,000.00) in the aggregate, for bodily injury, property damage, clean-up costs, and claim expenses. Such coverage shall extend to any non-owned disposal sites and activities involving transportation and/or hauling of hazardous materials. Such coverage shall be written for a five (5) year period from the Effective Date and renewed if commercially available. The University shall be endorsed as a Named Insured under such policy.

(ii) In connection with the initial construction of the Project, Lessee shall procure, or cause Lessee's Contractor to procure and maintain Contractor's Pollution

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Liability Insurance on an occurrence basis with a minimum limit of Five Million Dollars ($5,000,000.00) for each loss and Five Million Dollars ($5,000,000.00) in the aggregate, for bodily injury, property damage, clean-up costs, and claim expenses resulting from Lessee's Contractor's operations performed on the Leased Land and/or the Access Areas, including coverage for microbial matter, which coverage will be granted on a claims-made basis. Such coverage shall extend to any non-owned disposal site and any activities involving transportation and/or hauling of hazardous materials. Coverage shall remain in force during the term of the Work with respect to the initial construction of the Project, and for ten (10) years beyond the Completion of the Project. Lessee and the University shall be endorsed as a Named Insured under such policy.

Section 9.3 Liability Insurance - Consultants including Lessee's Arehit«t Bnd Lessee's Engineer. Lessee:further agrees at all times during the performanc.e Many Work to cause any architects, engineers and/or licensed design draftsmen hired by Lessee in connection with the (x) design of aliy part of the Project performed prior to Completion of the Project, or (y) design of any structural Work, including, additions, alterations or Restoration, performed after Completion of the Project to procure and continuously maintain in full force and effect during any period in which any such party is performing any Work, insurance to cover its activities :in connection with this Lease, the Leased Land and/or the Project for bodily injury, personal injury a~d property d~age as follows:

(a) BusiDesS Auto Liability. For autos owned, hired, scheduled or non-owned with a combined single limit no less than One Million Dollars ($1,000,000.00) per occurrence;

(b) Commercial .General Liability.

(I) General Aggregate (Bodily Injury, Property Damage): Two Million Dollars ($2,000,000.00).

(ii) Dollars ($1,000,000.00)

(iii) ($1,000,000.00).

Product/Completed Operations Aggregate: One Million

Personal and Advertising Injury: One Million Dollars

(iv) Each Occurrence: One Million Dollars ($1,000,000.00).

(e) Worker's Compensation. Workers' Compensation insurance, in an amount and form sufficient to meet all applicable governmental requirements, and Employer's Liability coverage with limits ornot less than One Million Dollars ($1,000,000.00) for bodily injury or death to anyone or more persons per accident, One Million Dollars ($1,000,000.00) bodily injury by disease each employee, and One Million Dollars ($1,000,000.00) policy limit for bodily injury by disease. Such policies shall COver all persons providing labor or services to or on behalf of such policy holder (as applicable, Lessee and Lessee's conSUltants) and risks to such persons for claims arising out of construction, use or occupancy of Leased Land, repair of or entry onto the Leased Land, prior to the completion date of the Work.

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(d) Professional Liability. When any architect, engineer and/or licensed design draftsmen is employed by Lessee, or Lessee's Contractor, to perform professional services for (x) any part of the Work performed prior to Completion of the Project, or (y) any structural Work, including, additions, alterations or Restoration, performed after Completion of the Project, Lessee shall cause Professional Liability (Errors & Omissions) Insurance to be carried by each architect, engineer andlor licensed design draftsmen hired directly by Lessee to perform professional services for any part of the Work and shall require Lessee's Contractor to cause Professional Liability (Errors & Omissions) Insurance to be carried by each architect, engineer and/or licensed design draftsmen hired directly by Lessee's Contractor to perform professional services for any part of the Work. Such insurance shall provide a minimum coverage limit per claim of not less than One Million Dollars ($1,000,000.00) for each claim and One Million Dollars ($1,000,000.00) in the aggregate, or such lesser amount as University may approve, in writing. Such policy may be written on a "claims made" basis provided it has a retroactive date of placement prior to or coinciding with the commencement of any professional services performed on any part of the Work, continues until the Completion of the Project or the subject structural Work performed after Completion of the Project, as applicable, and includes, if commercially available, at least a three (3) year discovery period for submitting claims following completion of the Work. Such policy shall provide coverage against loss or liability arising out of negligent errors or omissions of the insured party in performing its contractual and professional obligations relating to the design, engineering and construction of the Work,.as the case may be, or subsequent alteration or work ofimprovement, as applicable, and shall include such endorsements as reasonably required by University.

Section 9.4 Periodic Increases. The minimum policy limits specified in Section 9.1, Section 9.2 and/or Section 9.3 shall be subject to increase from time to time at the reasonable discretion of University; provided. however, that (x) such increases shall not occur more frequently than every four (4) years, and (y) without limitation to or any reduction in the specified policy limits expressly set forth herein, any such increases, if imposed, shall be consistent with minimum policy limits then being imposed by comparable lessors/owners in connection with projects which are similar in size, scope and nature.

Section 9.5 Additional Insureds. With the exception of the Worker's Compensation policies to be provided pursuant to Section 9.2(c) and Section 9.3(c) above the Professional Liability policies to be provided pursuant to Section 9.3(d) and the pollution liability policies to be provided pursuant to Section 9.2(d) above, the insurance policies provided by Lessee shall be endorsed to name the University and its officers, directors, members, shareholders and employees as Additional Insureds for completed and ongoing operations, by endorsement ISO form CO 2037 (1011) or its equivalent and such endorsement shall provide that such insurance shall be primary, and not excess or contributory to any insurance maintained by such Additional Insureds. With respect to the pollution liability policies to be provided pursuant to Section 9.2(d) above, the University shall be named as a Named Insured. With the exception of the Worker's Compensation policies and the Professional Liability policies, the insurance policies to be provided by Lessee's Contractor, the subcontractor or any consultants pursuant to Section 9.2(c) or Section 9.3(c), shall be endorsed to name the University and Lessee and their respective officers, directors, members, shareholders and employees as Additional Insureds (i) with respect to Lessee's Contractor, subcontractors, and consultants for completed and ongoing operations (by endorsement ISO form CO 2037 (1011) or its equivalent) and (ii) with respect all sub-

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contractors and consultants, for ongoing operations (by endorsement ISO fortn (C020 1 0 (10/03) or its equivalent) and CO 2037(10/01) shall provide that such insurance shall be primary, and not .excess or contributory to any insurance maintained by such Additional Insureds.

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Se(:tion 9.6 Lessee Not Relieved. It is expressly understood that the limits on insurance coverages and the specific types of insurance coverages required herein shall not in any way limit the liability.ofLessee hereunder.

Section 9.7 Proof oflnsuranee. At the request of University, Lessee shall cause to be delivered to University a complete certified copy of each such insurance policy or renewal or replacement insurance policy obtained by Lessee, Lessee's Contractor, Lessee's Architect and Lessee's Engineer. Coverage shall be in the form and substance as is then standard in the State of California for policies of like coverage and shall be issued by the Insurance companies referred to in. Section 9.12 below. In its sole discretion, Lessee may purchase and secure insurance meeting the insurance requirements herein referenced to protect University, Lessee, contractor and subcontractors of all tiers under an Owner Controlled Insurance Program (wrap-up insurance program). Without limiting the foregOing, upon execution of this .Lease and/or prior tQ commencement of any construction of the Work, Lessee shall cause to be delivered to University, as evidence of the insurance policies required of Lessee and Lessee's Contractor, Lessee's Architect, Lessee's Engineer, other consultants and subcontractors by this Lease, Certificates of.lnsurance for such coverage that.(i) shall be on standard ACORD· fonns with· policy endorsements acceptable to T)niver~ity, (ii) shaH provide for no can~llation or modification of coverage without 30 days (10 days for non-payment of premium) prior Notice to University, (iii) shall show all companies affording coverage, (iv) shall use the legal name of Lessee, Lessee's Contractor, Lessee's Architect and Lessee's Engineer, as the Named Insured in each of their respective policies as to such policy and (v) shall name The Regents of the University of California as Certificate Holder in the follOWing manner:

Real Estate Services University of Califomia, Davis One Shields Avenue Davis, California 95616-8678 Attention: Executive Director, Real Estate Services Telephone: (530) 754-8573 Facsimile: (530) 752-5808

Section 9.8- Proceeds. The proceeds from any insurance covering damage to the Project shall be applied as set forth in Article X below. If the proceeds of any insurance are not being held by Leasehold Mortgagee i,n accordance with the Project Financing Documents, then University and Le~see shall jointly name an independent corporate trustee to hold such insurance proceeds for such-purposes in trust and to make disbursements therefrom for the purpos~s of paying for the costs and expenses of such repair and Restoration of the damaged portion of the Project.

Section 9.9 Waiver of Subrogation Rights. Lessee hereby waives, and Lessee shall require Lessee's Contractor to waive, any and all rights of recovery against University and its officers, directors, members, shareholders and employees on account ofloss or damage to such

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waiving party or such waiving party's property or the property of others under its control (but, with respect to any party carrying third-party insurance, such waiver shall be effective only to the extent that such loss or damage is caused by or results from risks insured against under any such insurance policy). The property insurance to be maintained hereunder by Lessee andlor Lessee's Contractor shall permit the foregoing waiver of subrogation.

Section 9.10 Compliance with Requirements of Carriers. Lessee shall at all times observe and comply with the requirements of all of Lessee's policies ofinsurance in force with respect to the Leased Land, or any part thereof, and Lessee shall so perform and satisfy the requirements of the companies writing such policies so that, at all times, such policies shall be in force with companies of good standing complying with the requirements of this Article IX.

Section 9.11 Non-Coptributlng. All insurance required to be carried by Lessee, Lessee's Contractor, subcontractors, Lessee's Architect, Lessee's Engineer and other consultants pursuant to this Article IX shall be non-contributing with any insurance carried by any Additional Insureds under said policies.

Section 9.12 Form of Policies. All insurance required to be carried by Lessee, Lessee's Contractor, subcontractors, Lessee's Architect, Lessee's Engineer and other consultants pursuant to this Article IX shall be maintained with insurance carriers either (x) licensed and approved to do business in the State of Cali fomi a, or (y) listed in the List of Eligible Surplus Lines Insurers (LESLI) issued by the California Department ofInsurance), in each case having a general policyholders rating of not less than "A-" and financial rating of not less than "VIII" in the most current Best's Key Rating-Guide. In no event will such insurance be terminated or otherwise allowed to lapse prior to termination of this Lease, or such longer or shorter period as may be specified herein. Bach policy of insurance required hereunder (i) shall provide that it shall not be cancelled or modified without thirty (30) days (ten (10) days for nonpayment of premiums) prior Notice to University, and (ii) shall not include any cross suits exclusion related to claims between any insureds, whether between Named Insured, between Named Insured(s) and Additional Insured(s) or between Additional Insureds.

Section 9.13 Settlement of Claims. If any portion of the Project shall be damaged or destroyed by an insured peril and if, pursuant to this Article IX, any portion of such proceeds are payable to University, then Lessee shall not settle, adjust or compromise any insurance claim with respect to such damage without first obtaining the consent and approval of University to any proposed settlement, adjustment or compromise of any such insurance claim, except that nothing herein shall be construed to limit or restrict the rights of any Leasehold Mortgagee with respect to the disposition of any such proceeds.

ARTICLE X DAMAGE OR DESTRUCTION

Section 10.1 Minor Damage or Destruction. Except as provided in Section 10.2 below, if, during the Term, any portion of the Project is wholly or partially damaged or destroyed by a risk cOvered by insurance, or required to be covered by insurance under any term of this Lease, such damage or destruction shall not terminate this Lease, and Lessee shall, at its sole cost and expense (including, without limitation, any available insurance proceeds and the

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then current balance of the Capital Reserve Account, which shall be made available to Lessee to fund such costs and expenses), promptly repair and Restore the subject portion of the Project to substantially the same condition as existed immediately prior to such damage or destruction unless.University gives its prior written approval to do otherwise. Such Restoration shall be commenced promptly and prosecuted with due diligence. Without limiting the foregoing, if the anticipated cost of Restoration of the subject portion ofthe Project so damaged or destroyed exceeds Ten Thousand ($10,000.00), LeSsee shall give University prompt Notice of such damage or destruction. University hereby acknowledges and agrees that Lessee shall not be obligated to Restore, nor shall Lessee bear the risk of loss associated with, any such damage or destruction to any Delegated Punch List Work andlor the Univ~rsity Infrastructure Improvements; provided, however, that Lessee shall remain obligated to complete any Delegated Punch List Work in the event that (i) University Restores the portions of the Delivered Infrastructure to which such Delegated Punch List Work applies to substantiaily the condition that existed immediately prior to such damage or destruction, and (ii) Lessee has not tenninated this Lease pursuant to Section 10.2 below.

Section 10.2 Major Damage or Destruction. Notwithstanding the provisions of Section 10.1 above, if during the Term, any portions of the Project are wholly or partially damaged or destr~yed (i) by risk not insured afid not required to be insured under this Lease, or (ii) to .. extent that exceeds the limits of.inSurance required to be maintained under th.is Lease, or any insurance actually maintained in excess of the limits required to be maintained by this Lease, then Lessee shall'give University Notice of such damage or destruction detailing facts that qualify the casu.alty under this provision. Within sixty (60) days following any such damage or destruction, Less~e and University shall meet and confer.tO determine their respective response to such da,uage or destruction. In connection therewith, Lessee shall obtain estimates for the cost of'Restoiation of the affected portions of1:he Project from contractors and subcontractors and shall provide such estimates to the University for review together with a statement of any insufclIlce proceeds which Lessee anticipates will be available to pay such costs of Restoration. Notwithstanding anything to the contrary herein, if the cost of such Restoration to be paid by Lessee exceeds the Trigger Amount (as defmed below) (with such costs of Restoration to be . measured as the anticipated costs of such Restoration, after deducting the sum of (w) the then current balance of the Capital Reserve Account (which shall be made available to Lessee to fund such costs and expenses), (x) the amount of any insurance proceeds which are available for such Restoration in connection with such damage or destruction or otherwise woullil have been available had the insurance required under this Lease been maintained but was not maintained by Lessee, (y) the amount of any applicable deductible under the insurance policies referenced in the preceding item (x), and (z) any amount which University elects, in the exercise of University's sole and absolute discretion (without any obligation to do so), to fund toward payment ofthe costs of Restoration of the damaged Infrastructure Improvements), then Lessee shall have the right, exercisable 'in ~ssee's sale anrlabsolute discretion, by Notice delivered to University within one hundred twenty (120) days following the date of such casualty, to (1) Restore the Project, or (2) if such damage or destruction occurs prior to the expiration of the Master Lease, assign this Lease to WVCP for the purpose of permitting WVCP to Res~ore the Project and thereafter proceed with development of the Project in accordance with this Lease, or (3) to terminate this Lease; provided. hOwever, if Lessee fails to provide Notice to University of its election within such one hundred twenty (120) day period, then Lessee shall be deemed to have elected to Restore the Project, as provided in item (I) of this sentence and to have waived

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the right to either assign this Lease to WVCP, as provided in item (2) of this sentence, or to terminate this Lease, as provided in item (3) of this sentence. If Lessee is required to Restore the Project, or elects, or is deemed to have so elected to Restore, as provided in the preceding sentence, then Restoration by Lessee shall be commenced promptly and prosecuted to completion with due diligence and Lessee shall have the right to use all available proceeds of insurance maintained by Lessee for such purpose. If Lessee elects to assign this Lease to WVCP, then within thirty (30) days following Notice to University of such election, Lessee shall assign Lessee's entire right, title and interest in the Project (including Lessee's right, title and intC(est in and to any Student Bed Sublease and any Commercial Sublease), the Development Documents and the Development Agreements related to the Project to WVCP in a written assignment which shall include an express assumption by WVCP of all of the obligations of Lessee hereunder and an agreement by WVCP, in favor of University, that WVCP shall Restore the Project, in the same manner as though WVCP were Lessee hereunder and, in such capacity, WVCP had elected to Restore the Project pursuant to item (I) of the preceding sentence, and together with such assignment (A) except as otherwise agreed between Lessee and WVCP, Lessee shall be entitled to receive all proceeds of insurance maintained by Lessee and/or any Lessee Parties related to damage to the Project andlor interruption of Lessee's business; (B) Lessee shall leave the Project in place; and (C) WVCP shall provide a guarantor of this Lease who, together with WVCP, has a Tangible Net Worth equal to or greater than the Required TNW Amount, which guarantor shall execute a guaranty in the fonn of the Guaranty and deliver such Guaranty to University concurrently with such assignment If Lessee elects to terminate this Lease, then <n Lessee shall be entitled to receive all proceeds of insurance maintained by Lessee andlor any Lessee Parties related to damage to the Project andlor interruption of Lessee's business; 01) Lessee shall leave the Project in place; (III) upon the election of University, to be exercised in University's sole and absolute discretion, any portion of the Project shall be Demolished; (rV) subject to the provisions of the preceding item (111), Lessee shall surrender the Leased Land in the condition required pursuant to Section 14.2 below (taking into consideration the provisions of Section 4.4(b», (V) Lessee's right, title and interest in the Project (including Lessee's right, title and interest in and to any Student Bed Sublease and any Commercial Sublease), the Development Documents and the Development Agreements related to the Project shall automatically and without additional compensation to Lessee become the property and vest in University, (VI) Lessee shall execute such documents as University may request to memorialize the termination of this Lease and the transfer to University of all interests of Lessee in the Project (including Lessee's right, title and interest in and to any Student Bed Sublease and any Commercial Sublease), the Development Documents and the Development Agreements, (VII) this Lease shall terminate and all of Lessee's rights in the Leased Land, and every part thereof, and all of Lessee's rights in the Project, and every part thereof, shall terminate and Lessee's right, title and interest in Project (including Lessee's right, title and interest in and to any Student Bed Sublease and any Commercial Sublease), the Development Documents and the Development Agreements related to the Project shall automatically and without additional compensation to Lessee become the property and vest in University on the date which is ten (l0) Business Days following Lessee's completion of the Work described in items (III) and (IV) above. Upon any termination of this Lease pursuant to this Section 10.2, Lessee shall execute such documents as University may reasonably request to memoriali~e the termination of this Lease and the transfer to University of all interests of Lessee in the Project (including Lessee's right, title and interest in and to any Student Bed Sublease and any Commercial Sublease), the

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Development Documents and the Development Agreements and, if the Project Financing Documents remain an encumbrance upon Lessee's Interest on the date of such termination, then Lessee shall cause Leasehold Mortgagee to immediately record a release of any security interest Leasehold Mortgagee bas/had in Lessee's Interest, which release shall be accomplished through the recording in the Official Records of the County of a customary release document which has been approved by University in the exercise of its reasonable discretion. As used herein, the term "Trigger Amount" shall mean an amount equal to the product of (I) Three Million Dollars ($3,000,000.00), multiplied by (II) a fraction, the numerator of which is the CPI Index last published prior to the date of such damage or destruction, and the denominator of which is the CPI lndex last published prior to the Effective Date.

Section 10.3 Basic Rent Abatement. If damage or destruction of the Project actually prevents Lessee from leasing Student Beds comprising twenty-five percent (25%) or more of the Maximum Student Bed Count, then so long as Lessee diligently prosecutes Restoration of such damage or destruction to the Project, a portion of Basic Rent shall be abated during the Casualty Abatement Period (as defined below) in the proportion that the number of Student Beds which Lessee is so prevented from leasing bears to the Maximum Student Bed Count. As used herein, the term <,'Casualty Abatement Period" shall mean a period commencing on the date of the damage or-destruction giving rise to such right of abatement and continuing for the reasonably anticipated period of time thereafter required for Lessee to effectuate substantial completion of Restoration of such damage or destruction, taking into consideration the scope of the subject damage or destruction and Lessee's obligation to diligently pursue such Restoration to completion.

ARTICLE XI CONDEMNATION

Section 11.1 Lease Governs. In the event of any Taking during the Term, the rights and obligations of the parties with respect to such appropriation and any Net Awards and Payments in connection therewith shall be as provided in this Article XI. The following terms shall have the meanings set forth below:

(i) Net Awards and Payments Defined. The term "Net Awards and Payments" shall mean any awards and other payments or compensation payable to either University or Lessee, as the case may be, in connection with a Taking, less reasonable costs, fees and expenses of either University Or Lessee (including, without limitation, reasonable attorneys' fees and costs) incurred in the collection thereof; provided, however. (x) no award, other payment or compensation payable .to University with regard to any portion of the Master Project Leased Land, other than the Leased Land. shall be considered in the computation of the ''Net Awards and Payments," and (y) ifUniv~rsity is the condemning authority, then University shall not be entitled to receive reimbursement of, nor shall there be a deduction from the ''N e~ Awards and Payments" of the amount of, the University's costs, fees and expenses.

(U) Partial Taking Defined. A "Partial Taking" shall mean a Taking which does not constitute a Total Taking, as defined in Section 11.1(iv) below.

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(iii) Taking Defined. "Taking" shall mean any acquisition or taking of all or any portion of the Leased Land, or this Lease, or any interest therein or right accruing thereto, pursuant to or in anticipation ofthe exercise of the power of condemnation or eminent domain, or by reason ofthe temporary requisition of the use or occupancy of the Leased Land, or any part thereof, by any governmental or quasi-governmental authority, civil or . military, or any other agency empowered by law to take property in the State of Cali fomi a or under the laws of the United States of America under the power of eminent domain.

(iv) Temporary Taking Defined. A ''Temporary Taking" shall mean a Taking for temporary use or occupancy.

(v) Totill Taking Defined. A "Total Taking" shall mean:

(A) a Taking of all of the Leased Land other than for a temporary purpose; or

(B) at the option of Lessee, a Taking of so much of the Project as to substantially impair, or to render uneconomical, in Lessee's reasonable judgment, the development and/or operation of the Project.

(vi) Total Unit Reduction Defined. A "Total Unit Reduction" shall mean a permanent reduction in the aggregate number of Student Beds that Lessee is able to construct upon the Leased Land as the Project (either initially or through a reconstruction) which results from a Taking; provided, however, that a Student Bed shall not be included within the computation of a Total Unit Reduction if Lessee reconfigures and redesigns the Project upon the Leased Land remaining following such Taking, or would have reasonably been able to so reconfigure and redesign the Project in an economical manner, such that Lessee is not pennanently prevented from constructing the subject Student Bed.

Section 11.2 Total Taking; Termination; Distribution of Award. In the event of a Total Taking, this Lease shall terminate effective on the date of surrender of possession of the Leased Land, or so much thereof or interest therein as has been taken, to the condemning authority. Lessee shall continue to pay all amounts due hereunder and, in all respects, keep, observe and perform all of the terms, covenants, agreements and conditions of this Lease to be kept, observed and performed by Lessee until the date of such termination with the exception of the obligation to complete the Project. Lessee and University shall each be entitled to prosecute claims in such condemnation proceeding for the value of its respective interest in the Leased Land, or portion thereof, being so Taken. The Net Awards and Payments shall be divided pari passu between University and Lessee based upon the respective value of their interests; provided. however, if the Project Financing Documents encumber the Leased Land, or any portion thereof, on the date of such Taking, then Leasehold Mortgagee shall receive Lessee's share of such payments until all sums secured by its Leasehold Mortgage have been paid. Notwithstanding the forgoing, prior to any allocation of the Net Awards and Payments, both Lessee and University shall each be entitled to receive its respective reasonable costs, fees and expenses (including, without limitation, reasonable attorneys' fees and costs) incurred in the collection of any awards and other payments or compensation arising from such Taking;

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provided. however. if University is the condemning authority, then University shall not be entitled to receive reimbursement of the University's costs, fees and expenses.

Section 11.3 Partial TakinKi Effect; Restoration; Distribution of Award. In the event of a Partial Taking, this Lease shall remain in full force and effect with respect to that portion of the Leased Land not so taken and such Partial Taking shall be deemed to be an event of Force Majeure hereunder with respect to the portions of the Project to be constructed upon the portions ofth~ ·Leased Land affected by s~ch Partial Taking. Lessee shall promptly commence and proceed with due diligence to effect repair, replacement, relocation and/or reconstruction of the portions of the Project that are permitted to be constructed on the remaining portion of the Leas~ Land to cause such portions of the Project to be, as nearly as practicable, in the condition and character which existed immediately prior to such Taking and shall thereafter continue to construct the portions of the Project that are permitted to be constructed on the remaining portion of the Leased Land as and when required hereunder. From and after the date of such Taking, a portion of the Basic Rent shall be abated in the proportion that the number of Student Beds which are the subject of a Total Unit Reduction bears tQ the Maximum Student Bed Count; provided, however. if Lessee had already substantially completed construction ofa Building which became the subject of a Taking but the Student Beds within such Building dp not qualify to be included within the computation ofa Total Unit Reduction due to Lessee's ability to reconfigure and redesign the Project to be constructed upon the Leased Land remaining following such Taking, then in addition to the aforerneI).tioned abatement relating to a Total Unit Reduction, a portion of the Basic Rent in the proportion that the number of Student Beds within the subject Building bears to the Maximum Student Bed Count shall be abated for a period commencing upon the date of such Taking and continuing for a period of twenty-four (24) months thereafter. Lessee and University shall each be entitled to prosecute claims in such condemnation proceeding for the value of its respective interest in the portion of the Leased Land being so Taken. The Net Awards and Payments shall be allocated between University and Lessee as follows:

(a) First, to Lessee in an amount equal to the costs to be incurred by Lessee in the repair, replacement, relocation and/or reconstruction of the portions of the Project that are permitted to be constructed on the remaining portion of the Leased Land, as required herelDlder.

(b) Thereafter, any remain}ng amount of the Net Awards and Payments shall be divided pari passu between University and Lessee based upon the respective value of their interests in the portion of the Leased Land so Taken; provided, however. (i) the amounts received by Lessee pursuant to item (a) above shall not be duplicated in determining Lessee's interest under this item (b) and shall not be included for purposes of determining the respective pari passu distribution, and (ii) if the Project Financing Documents encumber the Leased Land, or any portion thereof, oil the date of such Taking, then Leasehold Mortgagee shaU receive Lessee's share of such payments until all sums secured by its Leasehold Mortgage have been paid.

Notwithstanding anything to the contrary set forth above, prior to any allocation of the Net Awards and Payments, both Lessee and University shall each be entitled to receive its respective reasonable costs, fees and expenses (including, without limitation, reasonable attorneys' fees and costs) incurred in the collection of any awards and other payments or compensation arising from

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such Taking; provided. however, if University is the condemning authority, then University shall not be entitled to receive reimbursement ofthe University's costs, fees and expenses.

Section 11.4 Temporary Taking; Efred; Distribution or Award. In the event ofa Temporary Taking, this Lease shall remain in full force and effect, and such Temporary Taking shall be deemed to be an event of Force Majeure hereunder with respect to the portions of the Project to be constructed upon the portions of the Leased Land affected by such Temporary Taking. Lessee shall be entitled to claim, recover and retain any Net Awards and Payments made on account of such Temporary Taking; provided. however. that (i) if the period of such Temporary Taking extends beyond the Term and such Temporary Taking involves all of the Leased Land or, at the option of Lessee, a Taking of so much of the Leased Land as to substantially impair, or to render uneconomical, in Lessee's reasonable judgment, the development andlor operation of the Project, then the Temporary Taking shall be treated as a Total Taking, this Lease shall terminate, the Net Awards and Payments shall be disbursed according to Section 11.2 above, and from and after the date of such Taking, Lessee shall have no further right, title or interest in the Leased Land; and (ii) if the period of such Temporary Taking extends beyond the Tenn, but such Temporary Taking does not fall within the provisions of preceding item (i), then the Temporary Taking shall pe treated as a Partial Taking, this Lease shall terminate with respect to the portion of the Leased Land which is the subject of such Taking, the Net Awards and Payments shall be disbursed according to Section 11.3 above, Lessee shall complete the relocation, repair, replacement or reconstruction of the Project as required hereunder, and from and after the date of such Taking, Lessee shall have no further right, title or interest in the portion of the Leased Land which is the subject of such Temporary Taking.

Section 11.5 ~. Upon any party receiving notice of or becoming aware of any condemnation proceedings, or threat thereof, such party shall promptly give Notice to the other party in the manner specified in Section 21.1.

Section 11.6 Covenant Barring Condemnation. The University hereby covenants and agrees· that, until the later to occur of (i) the expiration of the Master Lease, andlor (ii) the date which is fourteen (14) years following the Master Lease Effective Date, the University shall not initiate any Taking of the Leased Land by the University nor shall the University attempt to acquire any portion of the Leased Land (or any interest therein or right accruing thereto) through the power of condemnation or eminent domain. Notwithstanding the foregoing, University hereby agrees for the sole benefit QfLeasehold Mortgagee that, if the University exercises its power of eminent domain for the purpose of taking either an entire Building (or substantially all of such Building), or the entire Project at any time when Project Financing remains unpaid (including, without limitation, in the event that a Leasehold Mortgagee has foreclosed on the Project or acquired the same by a deed in lieu offoreclosure and such Leasehold Mortgagee or a Leasehold Mortgagee Affiliate retains ownership of the Project at the time of such Taking, it being agreed that such foreclosure or transfer in lieu of foreclosUre shall not be deemed to be a repayment ofthe principal amount of the Project Financing for purposes hereof), then so long as (X) the subject Project Financing funded by such Leasehold Mortgagee complied with the provisions ofitems (i) or (ii), respectively, of Section 16.2 below at the time such Project Financing was entered into, and (Y) the University approved such Leasehold Mortgagee's statement of the Loan Allocation at the time the subject Project Financing Documents were

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entered into, the award payable with respect to each Building which is the subject of such Taking by the University shall be a minimum of the Floor Amount; provided, however, where the subject Project Financing constitutes a Joint Financing, the "Loan Allocation" and the "Floor Amount" shall be determined upon the basis of such Joint Financing, as more particularly set forth in the definition of each of the tenns "Loan Allocation" and "Floor Amount".

ARTICLE XII ASSIGNMENT, SUBLETTING AND PURCHASE RIGHTS

Section 12.1 Assignment And Subletting. In no event shall Lessee be permitted to assign less than all of Lessee' s Interest. Except for an assignment to an Affiliate, any assignment to a Leasehold Mortgagee, in order to secure Project Financing, any Student Bed Sublease or any Commercial Sublease, (i) prior to Completion of the Project, Lessee shall not assign, sublease, pledge or hyp9thecate Lessee's Interest, whether directly or indirectly, without the prior written consent of University, which cOnsel'lt may be granted or withheld or conditioned in University's sole and absolute discretion, and (ii) following the Completion of the Project, Lessee shall t:lot assign, sublease, pledge or hypothecate Lessee's Interest, whether directly Or indirectly, Without the prior written consent ofUn~versity, which CODsent shall not be unreasonably withheld or cOl1.ditioned. Fot purposes of the preceding item (i), it shall be deemed to be reasonable for University to withhold its consent where the proposed sublessee or assignee does not have experience managing a student housing project of similar size and quality to the Project, as determined by University in the exercise Of University' s reasonable discretion, unless such proposed sublessee or assignee commits in writing to retain a property management firm having the requisite .experience to manage and operate the Project during the period in which such sublessee or assignee retains an interest in the Project and has so retained such a property management firm on the effective date oftbe subject sublease or assignm~t. If Lessee. attempts to assign, sublease; pledge or hypothecate all or any portion of Lessee's Interest without University's written consent, as provided in the preceding sentence, then in addition to the remedies set forth in Section 15.3 below, at University's election, to be exercised in University's sale and absolute discretion, such attempted ass~gnment, sublease, pledge or hypothecation shall be void and of no force or effect. Without limiting the foregoing, for the purposes of this Lease, a transfer of any direct or indirect ihterest (whether stock, partnership interest, Membership interest or otherwise) ofLess~e (including a tral'lsfer of any stock, partnership interest, membership interest or other interest in any parent of Lessee), either in one (1) transaction or a series of related transactions shall be deemed to be an assignment of Lessee's Interest under this Lease and shall req\Jire University's consent as provided above; provided, however. at any time in which Lessee consists ofWVCP or an Affiliate, University's consent shall not be required with respect to any such transfer of interests in Lessee so long as either (x) a combination of CP Investment Fund n, LP and Urban Villages, Inc., or (y) CP Investment Fund n, LP, individually continue to directly or indirectly (i) control Lessee, and (ii) own at least ninety percent (90%) of Lessee following such transfer. Notwithstanding the foregoing or anything to the contrary herein, during the existence of any Jomt Financing, all Joint Financing·Guarantors must be and remain s~bsidiaries of the same ultimate parent (whether individuals or entities) with the same respective direct or indirect ownership interest in each of the Joint Financing Guarantors and a transfer of any direct or indirect interest (whether stock, partnership interest, membership interest or otherwise) of any of the Joint Financing Guarantors (including a transfer of any stock, partnership interest, membership interest or other interest in any parent of any of the Joint

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Financing Guarantors) which results in any variation between the ultimate parent of Lessee and the ultimate parent of any of the other Joint Financing Guarantors shall entitle University to the remedies set forth in Section 15.3 below.

Sedion 12.2 Right of Fint Offer. The University shall have a recurring right offrrst ofTer ("Right of Offer") with respect to the sale or assignment of any portion of Lessee's . Interest, as foHows:

(a) If at any time Lessee shall intend to sell or assign Lessee's Interest (other than pursuant to an unsolicited offer, in which case the provisions of Section 12.3 shall ~pply), Lessee shall first offer to sell Lessee's Interest to University. E~ch ofTer to sell Lessee's Interest pursuant to this Section 12.2 shall be made initially in a written notice ("Offer Notice") delivered to the University.

(b) If University elects to pursue the exercise of the Right ofOfTer, then within thirty (30) days following receipt of an Offer Notice, University shall deliver written notice ("Election Notice'') to Lessee specifying the purchase price and other terms (herein, the "Offer Terms") upon which University would be willing to purchase Lessee's Interest.

(c) Lessee shall have a period of thirty (30) days following receipt ofan Election Notice to elect to accept the Offer Terms presented by University. If Lessee accepts the Offer Terms, then Lessee shall deliver written notice ("Acceptance Notice") to University stating Lessee's acceptance ofthe Offer Terms and the parties shall thereafter proceed with the transfer of Lessee's Interest to University in accordance with the terms of Section 12.4 below. If Lessee rejects the Offer Terms set forth in said Election Notice or University does not respond to an Offer Notice within the thirty (30) day period specified above, then, subject to University's rights set forth in Section 12.2 and University's approval rights over any assignee of Lessee's Interest set forth in Section 12.1 above, Lessee may proceed to offer Lessee's Interest for sale to other parties.

(d) Notwithstanding anything to the contrary herein, Lessee shall not be permitted to sell Lessee's Interest at a purchase price which is less than ninety five (95%) of purchase price set forth in the OfTer Terms or otherwise on terms substantially,less favorable to Lessee than the terms set forth in the Offer Terms, unless Lessee has first given University written notice ("Reduced Offer Notice") of Lessee's intention and provided University with the opportunity to agree to purchase Lessee's Interest upon such modified terms (herein, the "Reduced Offer Terms") for a period oftifteen (15) days following the date of delivery of such Reduced OfTer Notice. If University accepts the Reduced Offer Terms, then University shall deliver an Acceptance Notice to Lessee within such fifteen (15) day period stating University'S acceptance of the Reduced Offer Terms·and the parties shall thereafter proceed with the transfer of Lessee's Interest to University in accordance with the terms ofSeetion 12.4 below. If University rejects the offer set forth in said Reduced Offer Notice or does not respond to such Reduced Offer Notice within such fifteen (15) day period, then Lessee may proceed to sell Lessee's Interest at the Reduced Offer Terms offered to University pursuant to such Reduced Offer Notice; provided, however. Lessee shall not be permitted to sell Lessee's Interest at a purchase price which is less than ninety five (95%) of purchase price set forth in the Reduced Offer Terms or otherwise on terms substantially less favorable to Lessee than the terms set forth

OHS West:260944943.1 -73-

in the Reduced Offer Terms without once again providing University with a Reduced Offer Notice speCifying such new lower price and revised terms and proceeding to offer Lessee's Interest for sale to University pursuant to the preceding sentence. For the purposes of this Section 12.2, (x) to the extent that the subject offer includes taxable seller carry-back financing, University shall receive a credit against the purchase price commensurate with the tax-exempt nature of its debt service payments; and (y) as transfer and other documentary taxes will n6t be payable in a transfer to University due to University's status as a public agency, then to the extent not payable, University shall receive a credit against the purchase price in an amount equal to the transfer and other documentary taxes which would otherwise be payable, and the respective credits against the purchase price to be afforded University shall be taken into consideration in determining the requirement for Lessee's delivery of a Reduced Offer Notice to University aild the Reduced Offer Terms to b~ set forth in such Reduced Offer Notice.

(e) This Right ofOfi'er shall survive any sale or assignment of Lessee's Interest and apply in connection with any subsequent sale or assignment of Lessee's Interest occurring thereafter.

Section 12.3 Right of First Refusal. The University shall have a recurring right of fIrst refusal ("Right of Refusal'') with respect to the sale or assignment of any portion of Lessee's Interest, as follows:

(a) If at any time Lessee receives an unsolicited bona fide offer to purchase Lessee's Interest which Lessee wishes to pursue ("Purchase Offer"), Lessee shall provide University with written notice ("Pending Sale Notice") specifying the purchase price and other terms set forth in such Purchase Offer ("Available Terms").

(b) IfUniversity elects to pursue the exercise of the Right of Refusal; then within thirty (30) days following receipt of a Pending Sale Notice, University shall deliver written notice ("Purcbase Election NotJce") and the parties shall thereafter proceed with the transfer of Lessee's Interest to University in accordance with the terms ofSeetioD 12.4 below.

(e) If University rejects the Anilable Terms set forth in said Pending Sale Notice or University does not respond to a Pending Sale Notice within the thirty (30) day period specified above, then, subject to University's approval rights over any assignee of Lessee's Interest set forth in Section 12.1 abqve, Lessee may proceed with the sale of Lessee's Interest as specified in the Pending Sale Notice.

(d) Notwithstanding anything to the contrary herein, Lessee shall not be permitted to sell Lessee's Interest at a price and on terms which are less favorable to Lessee than the Available Terms, unless Lessee has first given University written notice ("Modified Terms Notice") ofLess~e's intention and provided University with the opportunity to agree to purchase Lessee's Interest upon such tnodifjed terms (herein, the "Mooified Terms Offer") for a period of fifteen (15) days following the date of delivery of such ModifIed Terms Notice. If University accepts the Modified Terms Oirer, then University shall deliver a Purchase Election Notice to Lessee stating University's acceptance of the Modified Terms Offer within such fifteen (15) day period and the parties shall ~ereafter proceed with the transfer of Lessee's Interest to University in accordance with the terms of Section 12.4 below. If University rejects the offer set forth in

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said Modified Terms Notice or does not respond to such Modified Terms Notice within such fifteen (15) day period, then Lessee may proceed to sell Lessee's Interest upon the Modified Terms offered to University pursuant to such Modified Terms Notice; provided, however, Lessee shall not be permitted to sell Lessee's Interest at a purchase price and on terms which are less favorable to Lessee than the Modified Terms Offer without once again providing University with a Modified Terms Notice specifYing such new modified terms and proceeding to offer Lessee's Interest for sale to University pursuant to the preceding sentence. For the purposes of this Section 12.3(d). (x) to the extent that the subject offer includes taxable seller carry-back financing, University shall receive a credit against the purchase price commensurate with the . tax-exempt nature of its debt service payments; and (y) as transfer an~ other documentary taxes will not be payable in a transfer to University due to University's status as a public agency, University shall receive a credit against the purchase price in an amount equal to the transfer and other documentary taxes which would otherwise be payable, and the respective credits against the purchase price to be afforded University shall be taken into consideration in determining the requirement for Lessee's delivery of a Modified Terms Notice to University and the Modified Terms Offer to be set forth in such Modified Terms Notice.

(e) This Right of Refusal shall survive any sale or assignment of Lessee's Interest and apply in connection with any subsequent Sft:le or assignment of Lessee's Interest occurring thereafter.

Section 12.4 University Purchase Procedures. If either (i) University elects to acquire Lessee's Interest pursuant to any Offer Notice or Reduced Offer Notice made pursuant to Section 12.2 above, or (ii) University elects to acquire Lessee's Interest pursuant to any Pending Sale Notice or Modified Terms Notice made pursuant to Section 12.3 above, then the closing thereon (the "Closing") shall occur in the manner and on the terms set forth in the respective Offer Notice, Reduced Offer Notice, Pending Sale Notice, or Modified Terms Notice, as applicable, as modified by the following: The Closing shall proceed through an escrow with a title company selected by the parties;

(b) University shall be afforded not less than a forty-five (45) day due diligence period in which to inspect all aspects of the Leased Land, the Project and the operation thereofand Lessee shall make available all of Lessee's books and records related to the operation and condition of the Project; and

(c) During the due diligence period referenced in the preceding item (b), University shall also seek to obtain the approval of the purchase by University's Board of Regents, which approval shall be a condition to University's obligation to proceed with any acquisition of the Project; provided, however, if such condition is neither satisfied or waived prior to the expiration of such forty-five (45) day period, then University shall be deemed to have elected to terminate the subject purchase contract and such termination shall be treated as though University had elected not to acquire Lessee's Interest pursuant to the subject Offer Notice, Reduced Offer Notice, Pending Sale Notice or Modified Terms Notice, as applicable, which originally gave rise to proceeding under this Section 12.4, but without limiting any further rights of University set forth in the provisions of Section 12.2 and Section 12.3, respectively.

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ARTICLEXID INDEMNITY, CLAIMS, LIENS AND ENCUMBRANCES

Section 13.1 Lessee Indemnity. Lessee shall indemnify, protect, defend (with counsel reasonably acceptable to University and Lessee) and hold University, the University of California, Davis and their respective employees, officers and agents (collectively, ''University Indemnitees") harmless from any Claims to the extent either resulting from Qr arising out of: (a) personal injury, cteatb, or property damage resulting from or arising out of the willful misconduct or negligent acts, errors or omissions of any Lessee Parties; (b) the conduct or activities by any ~essee party on the Leased Land or the Access Areas, including, any Claims. for damage or destruction to the Leased Land or any real property adjacent tO,or serving as ingress or egress from the Leased Land to the extent such damage or destruction results from, or arises out of such activities; ( c) the presence of any Hazardous Substances on the Leased Land, the Access Areas and/or any real property adjacent to the Leased Land and/or the Access Areas which pr~sence arises in connection with a breach of Lessee's obligations under Sec:tion 4.4 of this Lease, including, without limitation, any Claims for the cQsts of environmental or technical risk assessment, any cleanup or remedial cost, and the co~ts of any monitoring,-sampling or analysis, and any diminution in property value; (d) any violation by the Lessee Parties of any Applicable Laws, Governmental Authorizations, University Regulations, OREA(s) and/or the Entitlements Documents relating to the construction of the Project, the Delegated Punch List Work and/or to the use and occupancy of the Leased Land and/or the Access Areas; (e) any contest by Lessee conducted pursuant to Section 4.6 above or Section 13.4 below; (f) Lessee's breach of any of the representations, warranties and/or obligations identified in Section 21.2 and/or Section 21.14~ (g) Lessee's failure to surrender its interest in the Leased Land, or any part thereof, as required hereunder, at the expiration or sooner termination of this Lease; (h) any and all Claims brought by any Lessee Party or any Leasehold Mortgagee with respect to relocation benefits asserted pursuant to Applicable Laws and/or University Regulations, including, without limitation, California Government Code Section 7260 (et. seq.) and/or implementing regulations; and (i) any other breach by Lessee under this Lease; provided. however, in each case Lessee shall have no obligation to indemnify or hold any University Indemnitees harmless from any Claim to the extent such Claim results from or arises out of the willful misconduct or negligent acts, errors or omissions of any UniverSity Parties and/or University Indemnitees. Notwithstanding any other proviSion hereof: Lessee shall have no obligation to indemnify the University Indemnitees with respect to design or construction defect claims related to the acts or omissions of Lessee's Contractor, Lessee's Architect, Lessee's Engineer, or their respective contractors and subcontractors, related to the Delegated Punch List Work, provided that this caveat shall not limit or waive the indemnity provided in Subsections 13.1(&) and 13.1(d) above, nor conStitute a waiver or release of Lessee from its obligations under this Agreement or any Claims related thereto.

Section 13.2 University Indemnity. University shall indemnify, protect, defend (with counsel reasonably acceptable tb Lessee and University) and hold Lessee and Lessee's employees, directors, officers, shareholders, members, managers and agents (collectively, "Lessee Indemnitees") harmless from any Claims to the extent either resulting from or arising out of: (a) personal injury, death, or property damage resulting from or arising out of the willful misconduct or negligent acts, errors or omissions of (i) University, (ii) any of its employees arising while such employee was acting within the scope of employment, or (iii) the University's

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provIsions. Should Lessee fail to discharge or cause to be discharged any such claim of lien within thirty (30) day~ after service on Lessee, then, on Notice from University, University may pay, adjust, compromise and discharge any such lien or claim of lien on such terms and manner as University may deem appropriate. In such event, Lessee shall immediately reimburse University for the full amount paid by University in connection with such lien or claim of lien, including any attorneys' fees or costs; or other costs expended by University, together with Interest at the rate provided in Sedion 21.13 from the date of payment by University to date of repayment by Lessee. Lessee agrees to pay reasonable attorneys' fees, costs, charges and other expenses which University may incur in negotiating, settling, defending, and otherwise protecting University and University's interest in the Leased Land, and every part thereof, :from and against such liens or claims.

Section 13.4 Mechanics' and Similar Liens. Lessee shall payor cause to be paid the total cost and expense of all "work of improvement" (as defined in California·Civil Code Section 3106) with respect to the Project and the Delegated Punch List Work. No such payment shaH be construed as rent undet this Lease. Lessee shall not penn it any mechanic's, materialman'S, contractor's, subcontractor's or other similar liep., arising out of any work of improvement performed by Lessee or at Lessee's request to stand against the Leased Land, or any part thereof. If any such lien shall be filed agai{1st the Leased Land, or any part thereof, Lessee shall cause the same to be discharged prior to any foreclosure of such lien or execution is had based upon any judgment rendered thereon, by payment, deposit or bond. Notwithstanding the prior sentence, if Lessee seeks to extend the pendency of such lien in order to negotiate with the holder thereof or to contest such lien, then Lessee is authorized to do so provided that Lessee shall furnish the release bond required by California Civil CQde Section 3143, or any comparable statute hereafter enacted providing a bond freeing the Leased Land and every part thereof, and shall furnish such additional bond or security as University shall reasonably require to protect the Leased Land from the effect of such lien. The satisfaction and discharge of any such lien shall not, in any case, be delayed to the da~e execution is had upon any judgment rendered thereon.

Section 13.5 Relationship to Article XVI. Notwithstanding anything in this Article xm to the contrary, the provisions of this Article shall be subject to University's express agreements set forth in Article XVI below.

Section 13.6 Surviyal. The respective obligations and liabilities of Lessee and of University pursuant to the provisions of this Article xm shall survive the expiration or earlier termination of this Lease.

ARTICLE XIV HOLDING OVER:, SURRENDER,

OWNERSHIP OF PROJECT

Section 14.1 Holding Over. No holding Over after the termination Or expiration of this Lease shall be permitted. No holding over by Lessee after expiration or earlier termination shall constitute a renewal or extension of this Lease, nor shall it give Lessee any rights in or to the Leased Land, or any part thereof.

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Section 14.2 Surrender or Leased Land.

(a) Surrender or Lien-Free Title. Upon the expiration or earlier termination of this Lease, Lessee shall deliver possession of its interest in the Leased Land and every part thereof to University free and clear of all liens and encumbrances other than (i) those existing at the Effective Date, (ii) those created by University, and (iii) those liens and encumbrances approved in writing by University with the express agreement of University that such may survive the expiration or earlier tennination of this Lease. This obligation includes the obligation to discharge alltiens and encumbrances which may exist upon early termination of this Lease and which may survive such termination.

(b) Surrender Condition. Demolition. Upon the expiration or earlier termination of this Lease, Lessee shall surrender the Leased Land to University free of Lessee's personal property and all debris or wasre, placed on, about or near the Leased Land by any Lessee Parties and/or any Occupant (other than University), and in a condition which complies with aU Applicable Laws, Governmental Authorizations, OREA(s) and the Entitlements Documents related to Hazardous Substances whose presence on the Leased Land and/or any real property adjacent to the Leased Land andlor the Access Areas constitutes a breach of Lessee's obligations under Section 4.4 of this Lease, including, without limitation, the obtaining of any closure pennits or other governmental permits or approvals related to any such Hazardous Substances in, on or about the Leased Land Area or the Access Areas. Without limiting the foregoing, upon the expiration or earlier termination of this Lease, (i) Lessee shall leave the Project in place, provided, that upon the election of University, to be exercised in Univ~rsity's sole and absolute discretion, any portion ofthe Project shall be Demolished, and (ii) if University provides Lessee with Notice of University's intent to require Lessee to Demolish any of the Buildings upon the expiration of the Term, then commencing upon the sixtieth (60th

) anniversary of the Construction Commencement and continuing thereafter on each of the next four (4) subsequent anniversaries of the Construction Commencement, respectively, Lessee shall deposit into a cash account (herein, the ''Demolition Reserve Account") an amount equal to twenty percent (20%) ofthe Anticipated Demolition Costs. As used herein, the term "Anticipated Demolition Costs" shall mean an amount equal to one hundred ten percent (110%) of the estimated costs to complete Demolition of those improvements which University notifies Lessee that University intends to require Lessee to Demolish, as measured by the average of three bona fide third party bids for completion of such Demolition. Lessee shall pledge and assign the Demolition Reserve Account, together with all funds at any time on deposit therein and all interest and other earnings thereon, to University and grant University a security interest therein as security for payment and performance ot all of Lessee's obligations with respect to Demolition of the Project. In connection with the foregoing, Lessee shall execute a customary security agreement evidencing the security intere~t provided to University in the Demolition Reserve Account and shall enter into a customary account control agreement with University and the depositary bank: holding the Demolition Reserve Account evidencing the University's security interest in the Demolition Reserve Account and confirming that withdrawals from such account shall require the joint signature of University and Lessee, unless otherwise agreed by University in the exercise of University's sole and absolute discretion.

Section 14.3 Abandoned Property. If any personal property of Lessee is not removed upon the expiration or earlier termination of this Lease, University may, at University's election,

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use the personal property without compensation and without Iiability"for use or damage until Lessee's removal of such Equipment, or University may store such Equipment for the account and at the cost of Lessee. The election of one remedy for anyone item shall not foreclose an election of any other remedy for another item or for the same item at a later date. Without limiting the foregoing, all property that Lessee abandons shall, at University's election, become University's property upon termination of this Lease.

Section 14.4 Relocation. Lessee waives any and all claims for relocation benefits asserted pursuant to Applicable Laws and/or University Regulations, including, without limitation, California Government Code Section 7260 (et. Seq.) and/or implementing regulations. Without limiting the generality of the foregoing, Lessee hereby waives, and shall execute such documents as shall be reasonably required to evidence such waiver, of all rights and benefits to any relocation benefit or assistance arising in connection with (a) any termination of this Lease by reason of a Lessee Default hereunder; or (b) expiration of this Lease upon the Term Expiration Date.

Section 14.5 Survival. Lessee's obligations and liabilities pursuant to the provisions of this Article XlV shall survive the expiration or earlier termination of this Lease.

ARTICLE XV DEFAULT

Section 15.1 Default by Lessee. The occurrence of any of the following shall, at University's election, constitute a material default and breach ofthis Lease ("Lessee Default"):

(8) Lessee's failure to pay to University any amount due and payable hereunder within thirty (30) days after Notice that such amount is past due, with a cop):' of such Notice delivered to Leasehold Mortgagee in the manner provided in Section 16.4 below; provided. however, that (x) following any such failure by Lessee, University shall provide Lessee with a second Notice that such ~mount is past due following the expiration of such thirty (30) day period, with a copy of such second Notice delivered to Leasehold Mortgagee in the manner provided in Section 16.4 below, and shall not declare a Lessee Default or attempt to exercise the remedies available to University in the event of a Lessee Default, as set forth in Section 15.3, unless Lessee fails to pay to University any such amount which is due and payable hereunder within thirty (30) days after such second Notice that such amount is past due, and (y) if Lessee shall fail to pay to University any amount payable hereUl1der within ten (l0) Business Days after the first Notice that such amoUilt is past due, then in addition to the obligation to pay such amount due and any other remedy available to University hereunder, Lessee shall pay to University a late charge in the amount of two percent (2%) of the subject amount due;

(b) A failure by Lessee to observe and perform any other provision ofthis Lease to be observed or performed by Lessee, when such failure continues for (i) twenty-four (24) hours after Notice from University to Lessee, with a copy of such Notice delivered to Leasehold Mortgagee in the manner provided in Section 16.4 belOW, if such failure creates an imminent risk of bodily harm or significant property damage, or (ii) thirty (30) days after Notice thereofby University to Lessee, with a copy of such Notice delivered to Leasehold Mortgagee in

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the manner provided in Section 16.4 below; provided, however, that if the nature of such default is such that the same cannot reasonably be cured within such 24-hour or 30-day period, as applicable. Lessee shall not be deemed to be in default if Lessee shall, within such 24-hour or 30-day period, as applicable, commence such cure and thereafter shall diligently prosecute the same to completion;

(c) Until Completion of the Project, the failure of Lessee and Guarantor to collectively maintain a combined aggregate Tangible Net Worth which meets or exceeds th~ Required 1NW Amount;

(d) The making by Lessee or Guarantor or any of the Joint Financing Guarantors of any general assignment for the benefit of creditors, or the filing of a petition to have Lessee or Guarantor or any of the Joint Financing Guarantors adjudicated a bankrupt, or the filing of a petition for reorganization or arrangement with respect to either Lessee or Guarantor or any of the Joint Financing Guarantors under any law rel!lting to bankruptcy unless in the case of a petition filed against either Lessee or Guarantor or any of the Joint Financing Guarantors, the same is dismissed within sixty (60) days; or the appointment of a trustee or receiver to take possession of substantially all of Lessee's assets located on the Leased Land or of the Lessee's Interest, when possession is not restored to Lessee within sixty (60) days; or the appointment of a trustee or receiver to take possession of a material portion of Guarantor's assets or a material portion of the assets of any of the Joint Financing Guarantors, when possession is not restored to Guarantor or such Joint Financing Guarantor, as applicable, within sixty (60) days; or the attachment, execution or other judicial seizure of substantially all of Lessee's assets located on the Leased Land or of the Lessee's Interest, when such seizure is not discharged within sixty (60) days; or the attachment, execution or other judicial seizure of substantially all of Guarantor's assets or substantially all of the assets of any of the Joint Financing Guarantors, when such seizure is not discharged within sixty (60) days. Notwithstanding the foregoing, (i) all references to the Guaranty or Guarantor with respect to this Section 15.1 shall be deemed expunged upon the termination of Guarantor's obligations under the Guaranty, (ii) in connection with any Released Lease (as defined in Section 1 of the Joint Financing Guaranty), upon the release of the Joint Financing Guarantor who is the lessee under such Released Lease from the Obligations (as defined in Section 1 of the Joint Financing Guaranty and as such release is permitted under said Section 1). the Released Lease shall no longer be covered by the Joint Financing Guaranty, the lessee under such Released Lease shall no longer be a Joint Financing Guarantor and all references to the Joint Financing Guarantors with respect to this Section IS.1 shall be read without reference to such lessee; and (iii) all references to the Joint Financing Guaranty or the Joint Financing Guarantors with respect to this Section 15.1 shall be deemed inoperable upon the termination of obligations of the Joint Financing Guarantors under the loint Financing Guaranty, but shall thereafter be reinstated upon the execution of a new Joint Financing Guaranty in connection with any future Joint Financing;

(e) A failure by Lessee (in Lessee's capacity as a Joint Financing Guarantor) to observe and perform any provision of the Joint Financing Guaranty to be observed or performed by Lessee (in Lessee's capacity as a Joint Financing Guarantor), when such failure continues beyond any applicable time for performance set forth within the Joint Financing Guaranty;

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(f) A failure by Lessee to immediately stop all work upon receipt of a Stop Work Notice delivered by University in accordance with Section 5.13 of this Lease, or following receipt of any such Stop Work Notice, Lessee's commencement of any work on the Project prior to receipt ofa Recommencement Of Work Notice delivered by University in accordance with Section 5.13 of this Lease.

Section 15.2 Default by University. The occurrence of any of the following shall, at Lessee's election, constitute a material default and breach ofthis Lease by University ("University Default"):

(a)' University's failure to pay to Lessee any amount due and payable hereunder within thirty (30) days after Notice that such amount is past due; provided, however, that (x) following any such failure by University, Lessee shall provide University with a second Notice that such amount is past due following the expiration of such thirty (30) day period and shall not declare a University Default or attempt to exercise the remedies available to Lessee in the event of a University Default as set forth in Section 15.3 unless University fails to pay to Lessee any such amount which is due and payable hereunder within thirty (30) days after such second Notice that such ~ount is past due, and (y) if University shall fail to pay to Lessee any amount payable hereunder within ten (10) Business Days after Notice that such amount is past due, then in addition to the obligation to pay such amount due and any other remedy available to Lessee hereunder, University shall pay to Lessee a late charge in the amount of two percent (2%) of the subject amount due

(b) The University Infrastructure Completion Date fails to occur on or before the University Infrastructure Required Completion Date, ~ such University Infrasttvcture Completiop. Date may be extended due to ''Force Majeure" (as defined within and determined pursuant to the Master Lease) or as otherwise provided in Section 5.1 above or in the Master Lease; and

(e) A failure by University to ob$erve and perform any other provision of this Lease to be obs~rved or performed by University, when such failure continues for (i) twenty-four (24) hours after Notice from Lessee ifsuch failure creates an imminent risk of bodily harm or significant property damage, or (ii) thirty (30) days after Notice thereof by Lessee to University; provided. h'owever, that if the nature of such default is such that the same cannot r~onably be cured within such 24-hour or 30-day,period, as applicable, University shall not be d~med to be in default if University shall, within such 24-hour or 30-day period, as applicable, commence such cure and thereafter shall diligently prosecute the same to completion.

Sect jon 15.3 Remedies of University. Subject to the provisions of this Lease regarding rights of Leasehold Mortgagees, if a Lessee Default occurs then University may resort, cumulatively or in the alternative to the fOllowing remedies as well as to anyone or more other remedies provided by law or equity. University's remedies shall be subject to the requirements of Applicable Laws, including, without limitation, California Civil Code sections 1951 through 1952.2, inclusive, and California Code of CiVil Procedure section 1159, et aI. relating to actions for unlawful detainer, forcible entry and forcible detainer.

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(a) Termination. University may, at University's election, exercisable in its sole and absolute discretion, and subject to Applicable Laws, terminate this Lease by giving Lessee Notice of such termination, with a copy of such Notice delivered to Leasehold Mortgagee in the manner provided in Section 16.4 below. On the giving of such a Notice of termination, and subject to Applicable Laws, all Lessee's rights in the Leased Land, and every part thereof, shall terminate. University shall not be deemed to have terminated this Lease unless University shall have ~o declared in writing to Lessee, nor shaU University be deemed to have accepted or consented to an abandonment by Lessee by performing acts intended to maintain or preserve the Leased Land or any portions of the Project (including The Buildings), making efforts to relet the Leased Land or appointing a receiver to protect University's interest under this Lease. . Immediately after Notice of termination, Lessee shall surrender and vacate the Leased Land and all portions of the Project then constructed thereupon in the surrender condition required pursuant to Section 14.2 above, in~luding, without limitation, the Demolition of any Buildings elected by University pursuant to said Section 14.2 above, (B) if the Project Financing Documents remain an encumbrance upon Lessee's Interest on the date of such termination, then Lessee shall cause Leasehold Mortgagee to immediately record a release of any security interest Leasehold Mortgagee has/had in Lessee's Interest, which release shall be accomplished through the recording in the Official Records of the County of a customary release document which has been approved by University in the exercise of its reasonable discretion, and (C) University may reenter and take possession of the Leased Land and all portions of the Project (other than any Occupant in possession of either (i) a Student Bed pursuant to a valid Student Bed Sublease, or (ii) office/retail space pursuant to a valid Commercial Sublease) and eject all parties in possession or eject some and not others or eject none. Without limiting the foregoing but in connection with any termination of this Lease, University shall have the right to obtain equitable relief when such relief is otherwise appropriate, including, the relief provided by California Code of Civil Procedure Sections 1159 et aI., relating to actions for unlawful detainer, forcible entry and forcible detainer. Any lawful reentry as provided for herein shall be allowed by Lessee without hindrance, and University shall not be Hable in damages or guilty of trespass because of any such lawful reentry. In the event of any termination of this Lease pursuant to this Section 15.3(a), Lessee's ri.ght, title and interest in the Project (including Lessee's right, title and interest in and to any Student Bed Sublease and any Commercial Sublease), the Development Documents and the Development Agreements shall automatically and without additional compensation to Lessee become the property and vest in University. Upon any termination of this Lease, Lessee shall execute such documents as University may request to memorialize the termination of this Lease and the transfer to University of all interests of Lessee in the Project (including Le!jsee's right, title and interest in and to any Student Bed Sublease and any Commercial Sublease), the Development Documents and the Development Agreements.

(b) Recovery of Damages. In addition to any other remedies University may have, it may recover from Lessee all damages it may reasonably incur by reason of Lessee Default, including without limitation, the cost of recovering the Leased Land, the cost of completing construction of the Buildings and. reasonable attorneys' fees and expenses and all other amounts recoverable pursuant to Section 1951.2 of the California Civil Code; provided, however, with the sole exception of any liability of Lessee for diminution in value of the Leased Land, the Access Areas andlor any real property adjacent to the Leased Land andlor the Access Areas arising pursuant to Section 4.4 above andlor item (c) of Section 13.1 above, Lessee shall not be liable for damage or inconvenience to University's business or for any loss of income or

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profit therefro~, or for any consequential, indirect, incidental, special, punitive, or exemplary damages, notwithstanding any Lessee Oefault. Without limiting the foregoing, upon such termination, in addition to any other rights and remedies to which University may be entitled under applicable law, University shall be entitled to recover from Lessee: (i) the worth at the time of award of the unpaid Basic Rent and other amounts which had been earned at the time of termination; (ii) the worth at the time of award of the amount by which the unpaid Basic Rent which would have been earned after termination until the time of award exceeds the amount of such Basic Rent loss that the Lessee proves could have been reasonably avoided; and (iii) any other amount necessary to compensate University for all the detriment proximately caused by Lessee'S failure to perform its obligations under this Lease or which, in the ordinary course of things, would be likely to result therefrom. The ''Worth at the time of award" of the amounts referred to in clauses (i) and (ii) shall be computed with interest at ten percent (10%) per annum or the highest lawful rate, whichever is the lower.

(e) No Waiver. University's election to perform any obligation of Lessee following a Lessee Oefa.utt shall not constitute a waiver of any right or remedy available-to University for such Lessee Default.

(d) Remedies are Cgmulative. Each and all of the rights, powers, privileges, options, or remedies given University by this Lease are cumulative and no one of them is exclusive of the other or exclusive of any remedies provided by law, and the exercise of one right, power, privilege, option, or remedy by University shall not impair University's right to any other.

SectioD 15.4 Remedies of Lessee. In the event of a University Default, Lessee may resort, cumulatively or iii.-the altern,ative, to the following remedies as well as to anyone or more other remedies provided by law or equity including termination Of this Lease to the extent permitted by law. Lessee's remedies shall be subject to the requirements of Applicable Laws.

(i) Retovery of Damages. In addition to any other remedies Lessee may have, in the event of any University Default, Lessee may recover from University all damages Lessee may reasonably incur by reason of such University Default, including without limitation, (i) reasonable attorneys' fees and expenses, and (ii) all other amounts recoverable pursuant to Applicable Law. Notwithstanding anything to the contrary herein, with the sole exception of any liability ofUnivei'sity tor diminution in the property value of Lessee's Interest arising pursuant to item (h) ofSeetioD 13.2-, University shall not be liable for damage or inconvenience to Lessee's business or fQr any loss of income or profit therefrom, or for any consequential, indirect, incidental; special, punitive, or exemplary damages, under any circumstances, including, without limitation, upon the occurrence of any University Default.

(ii) kemedies are Cgmulative. Each and all of the rights, powers, privileges, options, ot remedies given Lessee by this Lease are cumulative and no one of them is exclusive of the other or exclusive of any remedies provided by law, and the exercise of one right, power, privilege, option, or remedy by Lessee shall not impair Lessee's right to any other.

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Section 15.5 Failure ofLes.see to Perform Required Acts. University shall have the right but not the obligation to undertake any Work that Lessee is required to perform under this Lease and that Lessee fails or refuses to perform in a timely and efficient manner, where University reasonably determines such failure will constitute an emergency or threat to the safety or security of the Leased Land or any portion of the Project. In addition, following the Completion of any Building, in the event of a Lessee Default, University may at University's option, without any obligation to do so, and without further Notice to Lessee, perform the terms, provisions, covenants or conditions to be performed or complied with by Lessee which gave rise to such Lessee Default and University shall not, by reason of so doing, be liable or responsible for any loss or 4amage thereby sustained by Lessee or any Occupant, except to the extent arising from University's negligence or willful misconduct All costs incurred by University in performing any such Work andlor performing any such terms, provisions, covenants or conditions, shall be repaid by Lessee to University upon written demand, together with interest computed from the date such costs and expenses are incurred by University and an administration fee equal to fifteen percent (15%) of such costs and expenses. Nothing contained in this Section 15.5 shall impair the rights of University with regard to defaults or remedies under the remaining portion of this Article XV.

ARTICLE XVI FINANCING

Section 16.1 Controlling Provisions. Lessee acknowledges that, in no event shall University's fee title in the Leased Land or its reversionary or future interest in the Leased Land be subject or subordinate to the lien of any loans, mortgages, deeds of trust, other leases, liens and encumbrances that may hereafter be permitted to be placed by Lessee on Lessee's Interest.

Section 16.2 Financing. Unless Lessee has provided University with evidence, reasonably satisfactory to University, that Lessee has funds which are immediately available to Lessee for the purposes of funding the construction of the Project, Lessee shall, at its own cost and expense, obtain all financing necessary for the completion of the Project and/or any financing necessary or desirable for the operation of the Project follo~ing Completion of the Project (collectively herein, the "Project Financing',); provided, however.

(i) with respect to (x) any construction loan, the original principal amount of all loans secured by Lessee's Interest shall not exceed seventy-five percent (75%) of the budgeted cost for completion of the Project which are to be funded from the proceeds of such loan (provided, however, ifthe Project Financing is a Joint Financing obtained by the Joint Financing Guarantors colleotively as co-borrowers, then the "budgeted cost for completion of the Project" shall be measured as the budgeted cost for completion of all of the Joint Financing Projects which are to be funded from the proceeds of such loan as reflected within the construction budget presented to the University in connection with review of the proposed Joint Financing), and (y) any loan originated after Completion of the Project, including, any refinancing of any prior Project Financing, (A) the original principal amount of all loans secured by Lessee's Interest shall not exceed eighty percent (80%) of the then current fair market value of Lessee's Interest (provided, however, if the Project Financing is a Joint Financing obtained by the Joint Financing Guarantors collectively as co-borrowers, then (1) the preceding clause (x) shall apply with respect to any Joint Financing obtained prior to the Completion of the Joint Financing Projects, and (2) with

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respect to any Joint Financing obtained after Completion of the Joint Financing Projects, the "current fair market value of Lessee's Interest" shall be computed for each of the respective Joint Project Financing Guarantors in connection with the Joint Financing Projects which are to be funded from the proceeds of the proposed Joint Financing), and (B) at the date of origination of any such Project Financing, Lessee shall have a Debt Service Coverage Ratio of not less than U5:1 (provided, however, if the Project Financing is a Joint Financing obtained by the Joint Financing Guarantors collectively as co-borrowers after the Completion of the Joint Financing Projects, then the Joint Financing Debt Service Coverage Ratio shall be not less than 1.15:1);

(ii) University shall have the right to (A) review and approve, in the exercise of its reasonabl<, discretion, (x) the identity of any proposed Leasehold Mortgagee, and (y) subject to the Rights of Redaction set forth below, the terms of any note, deed of trust, mortgage, security agreement or other document to be entered into by Lessee in connection with any Project Financing which will be secured by all or any portion of Lessee's Interest (such deed of trust, herein a "Deed of Trust" and such documents collectively herein, the "Project Financing Documents") and any modification to the terms and conditions of such Project Financing Documents that either (1) are to ~ set forth in a recorded document, or (2) mndifY the provisions relating to (a) the availability of casualty proceeds andlor the terms for release thereof for use in Restoration of the Project, andlor (b) the availability of condemnation awards, Or the terms for release thereof or the priority of University's interest in any portion thereof, and (B) without limitation to the University's rights pursuant to the preceding item (A), in the case of any Joint Financing, to review the terms for and documenfation of the addition or removal of any Student Sub-Phase Lease andlor co-borrower from the scope and coverage of the Project Financing Documents for the purpose of confirming Utat such addition or removal would not result in a violation of the terms of the Joint FinlJIlcing Guaranty andlor the terms of this Lease (including, any of the requirements for Joint Financing set forth in this Lease); and

(iii) it shall be a conditi911 precedent to Lessee entering into any Joint Financing that (1) the Joint Financing Guarantors satisfy theJoint parent ownership requirements set forth in the last sentence of Section 12.1 above, and (2) the respective Joint Financing Guarantors, each contemporaneously with the execution of the Project Financing Documents, duly execute and deliver to University the Joint Financing Guaranty in the form of Exhibit F attached hereto and by this reference incorporated herein.

Notwithstanding the foregoing or anything to the contrary herein,

(AA) University shall not withhold its approval of'any proposed Leasehold Mortgagee which (D has greater than Five Billion Dollars ($5,000,000,000.00) in ass~ts, (II) has expertise in construction lending or permanent lending, as applicable, for projects similar in type and size to the Project, and (111) is either (w) a national or state chartered bank or savings and loan association, (x) an insurance company which is licensed and authorized to do business in the State of Galifomia, (y) an investment bank, or (z).a pension mnd which is licensed and authorized to db business in the. State of California;

(BB) in connection with any loan originated after Completion of the Project, including, any refinancing of any prior Project Financing, (1) University shall not withhold its approval of any

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proposed Leasehold Mortgagee that has a contractual arrangement with Freddie Mac, Fannie Mae or a government lending agency (such as HUD or the Federal Home Loan Bank) related to origination of loans such as the then subject proposed Project Financing, if the then subject Project Financing being proposed to be offered by such proposed Leasehold Mortgagee would comply with all of the loan origination underwriting requirements established by Freddie Mac, Fannie Mae or a government lending agency (such as HUD or the Federal Home Loan Bank), as applicable, for such proposed Leasehold Mortgagee and there is a reasonable expectation that the proposed Project Financing is being originated for later assignment to Freddie Mac, Fannie Mae or a government lending agency (such as HUD or the Federal Home Loan Bank), as applicable, and (n) University's rights of approval specified in item (ii) above shall be limited to (x) confirming that the Project Financing Documents do not contain terms which purport to grant rights to the proposed Leasehold Mortgagee which exceed the rights granted to the Lessee within this Lease (as the same are modified by the mortgagee protections expressly set forth in this Article XVI) or otherwise violate the terms of this Lease, (y) confirming compliance with the maximum loan to value test and the Debt Service Coverage Ratio (or Joint Financing Debt Service Coverage Ratio, if applicable) requirements set forth in item (i)(y) above, and (z) confirming that the proposed Leasehold Mortgagee meets the requirements of items (AA) and/or (BB)(I) above, or is otherwise approved by University, in the exercise of University's reasonable discretion; and

(CC) so long as the aggregate outstanding principal indebtedness under any Joint Financing with respect to the initial construction Joint Financing does not exceed the limitations set forth in item (i)(x) above, the Leasehold Mortgagee with respect to such initial construction Joint Financing may (without any requirement to obtain the consent of the University) advance additional loan proceeds beyond the initial loan amount stated within the applicable Project Financing Documents to pay for actual costs of construction of the Joint Financing Projects which exceed the budgeted costs to complete the Joint Financing Projects.

In the eventLessee obtains a loan secured by all or any portion of Lessee's Interest, University will execute all documents or instruments reasonably required by the Leasehold Mortgagee and approved by University, provided that:

(a) University shall not be required to sign any Project Financing Documents, including, without limitation, any Deed of Trust or note, or be required to sign any other document or agreement obligating University to pay any portion of the Project Financing, or otherwise become obligated thereunder;

(b) No lien, charge or encumbrance created by or arising under or in connection with the Project Financing Documents shall constitute a lien or encumbrance upon University's fee title in the Leased Land;

(e) Any lien in favor of the Leasehold Mortgagee on Lessee's Interest shall expire on or before the date or'expiration of the instrument which is the source of Lessee's Interest;

(d) The Project Financing Documents impose no financial obligations on University, contingent or otherwise;

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(e) The Project Financing Documents shall neither subordinate nor affect University's right to convey, mortgage, encumber, or otherwise hypothecate in any way University's fee title in the Leased Land;

(I) Except as otherwise provided herein, neither the Leasehold Mortgagee nor anyone claiming by, through or under the Leasehold Mortgagee shal~ by virtue of such claim, acquire any greater rights than Lessee then had under this Lease;

(g)- The Project Financing Documents shall be subject to all conditions, covenants and restrictions of this Lease and to all rights of University hereunder;

(b) .The Project Financing Documents shall provide (i) that not less than thirty (30) days before the Leasehold Mortgagee's consummation ofa foreclosure on Lessee's Interest or completio~ of any negotiations to accept a transfer in lieu of such foreclosure, the Leasehold Mortgagee shall notify University in writing that such proceedings or negotiations have been or are to be commenced, and University shall have the right, but not the obligation, prior to the consummation of any -such foreclosure or accep~ce of any transfer in lieu thereof to purchase the Project Financing Documents and the indebtedness which they evidence or secure at a purchase price equal to the fun amount then owing under the Project Financing Documents, in accordance with their terms; (ii) the Leasehold Mortgagee's agreement to give University notice of any default by Lessee under the Projept Financing Documents which the Leasehold Mortgagee. gives to Lessee in writing, at the satne time and in the same manner that such notice is delivered to Lessee (and no such notice shall be valid with respect to University unless a copy is so delivered to University); and (iii) the Leasehold Mortgagee's agreement to accept performance of any ofLesse~' s obligations from University; and

(i) All insurance proceeds arisi~g from damage or destruction of the Project shall be made available for restoration thereof, subject to Lessee's satisfaction of the tenns and conditions set forth in the ProjQCt Financing Documents relating to the use of such proceeds for any such restoration, which provisions sh~ll be subject to the reasonable approval of University.

Notwithstanding the foregoing, Lessee shall have the right (herein the "Right of Redaction") to redact the following types ofinfonnation from any ()fthe Project Financing Documents which will not be recorded in the Official Records of the County and University hereby agrees that University shall not have the right to review and approve such redacted infonnation: (A) construction schedules, and (B) fmancial information regarding Lessee and/or the Project, other than any financial information to be provided to University pursuant to either Section 3.2 or Section 6.1 above.

Section 16.3 Transfer. The consent of University shall not be required for (I) any transfer of (i) Lessee'S Interest to Leasehold Mortgagee or any other person or entity by foreclosure, deed in lieu of foreclosure, court order or other transfer pursuant to the Project Financing Documents, or (ii) Leasehold Mortgagee's interest in this Lease and the Project, as a successor to Lessee's Interest to any Leasehold Mortgagee Affiliate, or (iii) so long as a guarantor who, together with WVCP, has a Tangible Net Worth equal to or greater than the Required TNW Amount, is prepared to execute a guaranty in the fonn of the Guaranty in connection therewith, any assignment to WVCP pursuant to Section 10.2 above, or (II) any

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syndication of, or transfer of participation interests in, the Project Financing. Except as provided in the preceding sentence, no transfer of Leasehold Mortgagee's or Leasehold Mortgagee Affiliate's estate under this Lease and in the Project as a successor to Lessee's Interest to any other person or entity shall be effective until the foHowing conditions have been satisfied: (x) the transferee shall have given Notice to University in writing of such transfer, setting forth the name and address ofthe transferee, the effective date of the transfer, and the express agreement of the transferee to assume and agree to perform all of the obligations under this Lease required of Lessee to be performed from and after the date of such transfer (including, without limitation, all obligations with respect to item (y) ofSeetion 4.4(b) and all obligations related to surrender of the Leased Land as set forth in Sedion 14.2), together with a copy of the document by which such assignment was made; and (y) University shall have approved any proposed transferee's financial capability and development and operation experience in light of Lessee's obligations under this Lease, which approval shall no.-be unreasonably withheld; provided, however. after the Leasehold Mortgagee or a Leasehold Mortgagee Affiliate has acquired the Project (either through foreclosure or a deed in lieu of foreclosure), the University will not withhold, condition or delay, approval ofa proposed transferee or sublessee requested by Leasehold Mortgagee (or such Le.asehold Mortgagee Affiliate), where:

(A) the principal who is the controlling principal of such proposed transferee or sublessee:

(i) has at least seven (7) years of experience in the operation, management and marketing of at least two (2) apartment projects of similar size and quality to the Project (provided, however, that this item (A)(i) may be satisfied by such proposed transferee or sublessee providing University with documentation evidencing that such proposed transferee or sublessee has retained an operator/manager who has at least seven (7) years of experience in the operation, management and marketing of at least two (2) apartment projects of similar size and quality to the Project and who also (independently of, and without limiting, the obligations of such proposed transferee or sublessee) meets the requirements of item (A)(iii) below and items (B)(i), (B)(iii), (B)(iv), (B)(v) and (B)(vi) below, substituting such operator/manager for the words transferee/sublessee in evaluating compliance with such items for such purpose; provided. further however, ifthe proposed transfer is to occur prior to Completion of the Project, the proposed transferee or sublessee shaH en~r into an agreement with the University evidencing the commitment of the proposed transferee or sublessee to retain such a qualified operator/manager prior to the date of commencement of leasing activities with respect to any Building comprising the Project and evidencing that failure to retain such a qualified operator/manager shaH be a Lessee Default hereunder);

(ii) ifsuch proposed transfer/sublease is to occur (x) prior to Completion of the Project, such proposed transferee/sublessee together with the party(ies) who wiII be guaranteeing the obligations of such transferee/sublessee have a combined aggregate net worth at least equal to the Completion Net Worth, or (y) after Completion of the Project, such transferee/sublessee has provided University audited financial statements for the last three (3) years showing that such

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transferee/sublessee (or its direct or indirect parent company if such transferee/sublessee is a newly-formed entity) has been profitable in at least two (2) of the last three (3) years of operations (without consideration of the first year of operation of any newly constructed project);

(iii) is free of repeated and significant unresolved complaints or repeated and significant unresolved claims asserted by regulatory agencies 'and free of repeated and significant unresolved complaints or repeated and significant unresolved claims asserted by residents in either a civil action or a formal complaint to a tenant union, tenant advocacy group, Student Affairs Department, a State or City housing board, the Better Business Bureau or similar venue, and (iv) in the case of a sublease, is subleasing the entire Project; and

(B) neither such proposed transferee/sublessee nor any of the direct or indirect holders of any equity interest in sueh transferee/sublessee, nor any of the affiliates of such proposed transferee/sublessee:

(i) have been a party to any repeated or significant unresolved complaints or repeated and significant unresolved claims in any other contract between such proposed transferee/sublessee and the University of California;

(ii) have been the party to any eviction (as the party being evicted) or breach of contract action (as the party being sued for such breach of contract) with respect to any contract or agreement involving annual payment obligations of greater than One Hundred Thousand Dollars ($100,000.00) during the preceding seven (7) years;

(iii) have been the subject of any civil or administrative judgments involving fraud or dishonesty;

(iv) have any criminal convictions of any kind;

(v) have been the subject of any civil, administrative or criminal investigation involving matters of moral twpitude which did not result in a dismissal with prejudice of all such charges; andlor

(vi) a person with whom any lender is restricted from doing business under regulations of the Office of Foreign Asset Control ("OFAC") of the Department of the Treasury of the United States of America (including, those persons named on OFAC's Specially Designated and Blocked Persons Jist) or under any statute, executive ~rder (including, the September 24,2001 Executive Order Blocking Property mid Prohibiting Transactions. With Persons Who Commit, Threaten to Commit, or Support Terrorism), or other governmental action or is otherwise engaged in any dealings or transactions or otherwise associated with any such persons.

As used herein, the term "Completion Net Worth" shall mean the greater of (X) Twenty Million Dollars ($20,000,000.00), and (Y) an amount equal to 150% of the remaining cost to

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) complete the Project; provided, however, where the subject Project Financing constitutes a Joint Financing, the amount set forth in this item (Y) shall be computed on the basis of 150% of the remaining cost to complete all portions of the Master Project which any of the Joint Financing Guarantors have any liability to complete (either as a lessee or guarantor of the obligations of any such lessee).

Section 16.4 Notice to Leasebold Mortgagee. Concurrently with the execution of Project Financing Documents for any loan secured by Lessee's Interest, Lessee or the Leasehold Mortgagee shalt" furnish to University the name and address of the Leasehold Mortgagee. University shall thereafter give Leasehold Mortgagee a duplicate copy of each Notice concerning default or conditions relating to default which University may from time to time give Lessee under the terins of this Lease at the time and in the manner that each such Notice is given to Lessee. No Notice delivered pursuant to Section 15.1 shall be valid with respect to Lessee unless a copy of such Notice is delivered to Leasehold Mortgagee as provided in this Section 16.4.

Section 16.5 Request for Notice of Defaults. Upon the recording of any Deed of Trust constituting a Project Financing Document, Lessee shall, at Lessee's expense, cause to be recorded in the Official Records, a written request, executed and acknowledged by University, for a copy of all notices of default and all notices of sale under such Deed of Trust, as provided by the laws ofthe State of California. Lessee shall include in the body of such recorded Deed of Trust itself a request for notice having the effect described above.

Section 16.6 Leasehold Mortgagee's Cure Rigbts. Notwithstanding anything to the contrary herein, the rights of Leasehold Mortgagee under this Article XVI shall be cumulative and no failure to exercise the rights under this Section 16.6 shall prevent Leasehold Mortgagee from exercising its rights under Section 16.7 below.

(a) After receipt by Lessee of a Notice of default under th.is Lease and the expiration of any applicable period of cure given to Lessee under this Lease or such Notice without Lessee's having cured the default so noticed, University shall deliver an additional notice ("Lender's Notice1

') to the Leasehold Mortgagee specifying the default and stating that Lessee's period of cure has expired without Lessee's having cured the noticed default. Leasehold Mortgagee shall thereupon have the additional periods of time to cure any uncured default, as set forth below, without payment of default charges, fees, late charges or interest that might otherwise be payable by Lessee. University shall not terminate this Lease, or otherwise exercise any of its other remedies under this Lease if:

(i) with respect to a default which can be cured by the payment of money, within sixty (60) days following the Leasehold Mortgagee's receipt ofLender~s Notice, the Leasehold Mortgagee pays to University or causes University to be paid the amount of money owed; provided, however, that so long as Leasehold Mortgagee initiates foreclosure or other appropriate proceedings to obtain possession or control ofthe Leased Land within such sixty (60) day period and thereafter diligently prosecutes such foreclosure or other appropriate proceedings, then Leasehold Mortgagee shall be relieved from Leasehold Mortgagee Excluded Obligations and University shall not exercise its rights to terminate this Lease due to Lessee's

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failure to pay any amounts due to University with respect to such Leasehold Mortgagee Excluded Obligations.

(Ii) with respect to a defaUlt which cannot be cured by the payment of money (except as provided in clause (iii) below), sixty (60) days after the Leasehold Mortgagee's receipt of the Lender's Notice, the Leasehold Mortgagee (A) cures the default, or (B) if the default reasonably requires more than sixty (60) days to cure, within such sixty (60) day period commences to cure such default and diligently prosecutes the same to completion within a reasonable time thereafter; or "

(iii) with respect to a default that cannot be cured by payment or without possession of the Leased Land or which is otherwise not susceptible to cure by Leasehold Mortgagee (such as defaults of Lessee arising from a breach of any covenant relating to (x) the Required TNW Amount, "and/or (y) the bankruptcy or insolvency of either Lessee or Guarantor), the Leasehold Mortgagee initiates foreclosure or other appropriate proceedings to obtain possession or control of the Leased Land within sixty (60) days after receipt of the Lender's Notice, cures all other defaults reasonably capable of cure, and complies with all other covenants and conditions of this Lease reasonably capable of compliance by Leasehold Mortgjlgee. Leasehold Mortgagee shall then have sixty (60) days following the later to occur of (A) the date of execution and delivery of a "New Lease" (as defined below), or (8) the date on which Leasehold Mortgagee or its designee is able to occupy the Leased Land following eviction of or vacating by Lessee, to cure such default, except 'that, if any such default, by its nature, is such that it cannot practicably be cured within such 6O-day period, then Leasehold Mortgagee shall have such time as shall be reasonably necessary to cure the default, so long as Leasehold Mortgagee commences such cure withih such 60-day period and thereafter diligently prosecutes the cure to completion.

(b) University agrees to accept performance by the Leasehold Mortgagee of all cures, conditions and covenants as though performed by Lessee, and agrees to permit the Leasehold Mortgagee access to the Leased Land to take all such actions as may be necessary or useful to perform any condition cir covenants of the Lease or to cure any default of Lessee.

(c) Upon the Leasehold Mortgagee's acquisition of Lessee's Interest by foreclosure or otherwise pursuant to its 'rights, under the Project Financing Documents, or if a receiver is appointed, this Lease shall continue in full force and effect and University shall treat the Leasehold Mortgagee or its designated Leasehold Mortgagee Affiliate as tenant under this Lease. If the Leasehold Mortgagee cures all defaults by Lessee (other than defaults constituting Leasehold Mortgagee Excluded Obligations) and does not acquire this Lease, or if the Leasehold Mortgagee takes any step to enforce its rights and thereafter Lessee cures such defaults (which cure University shall be obligated to accept) and the LeasehOld Mortgagee then terminates all enforcement proceedings, then this Lease shall remain in full force and effect between University and Lessee.

(d) So long as the Leasehold Mortgagee is prevented by any process or injunction issued by any court or by any statutory stay, Or by reason of any action by any court having jurisdiction of any bankruptcy or insolvency proceeding involving Lessee, from commencing or prosecuting foreclosure or other appropriate proceedings in the nature thereof,

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) the Leasehold ~ortgagee shall not be deemed for that reason to have failed to commence such proceedings or to have failed to diligently prosecute such proceedings.

(e) The Leasehold Mortgagee shall not be required to cure any defaults of Lessee under this Lease that are personal to Lessee and, consequently, are not ~usceptible of cure by Leasehold Mortgagee.

(1) Notwithstanding anything to the contrary in this Artide XVI, nothing in this Article XVI shall waive or release Lessee and/or Guarantor from any obligations to University with respect to the Leasehold Mortgagee Excluded Obligations and University may maintain and prosecute, at any time, a breach of contract action against Lessee in connection . with, any amounts owed to University by Lessee with respect to any Leasehold Mortgagee Excluded Obligations.

Section 16.7 New Lease. Except with respect to a termination of this Lease pursuant to the provisions of Section 4.4(1) above, Article XI, Article xn or Article XVII, if(l) this Lease is terminated prior to the end of the Term for any reason or otherwise expires by its terms at a time when the fmancial obligations owed to I,.easehold Mortgagee under the Project Financing Documents have not been satisfied in full, or (2) Leasehold Mortgagee (or its nominee or other purchaser at a foreclosure sale pursuant to item (I)(i) of Section 16.3 above) acquires Lessee's Interest through foreclosure, deed in lieu of fO,reclosure, court order or other transfer pursuant to the Project Financing Documents at a time when this Lease has not previously been terminated in accordance with the terms hereof, then University shall enter into a new Lease (the "New Lease") with the Leasehold Mortgagee or the Leasehold Mortgagee's nominee covering the Leased Land, provided that the Leasehold Mortgagee (i) requests such New Lease by written notice to University within sixty (60) days after either delivery of written notice by University to the Leasehold Mortgagee of termination or expiration oftbis Lease, or the date of acquisition of Lessee's Interest by Leasehold Mortgagee as provided in item (2) above, as applicable, and (ii) cures, within thirty (30) days following University granting such New Lease to Leasehold Mortgagee, all prior defaults of Lessee that can be cured by the payment of money or that are reasonably capable of being cured by the Leasehold Mortgagee (other than defaults constituting Leasehold Mortgagee Excluded Obligations); provided, however, that if any prior default (other than those that can be cured by the payment of money) is not capable of being cured within such 30-day period, Leasehold Mortgagee or its nominee shall have a reasonable period of time following University granting such New Lease to cure such default provided that Leasehold Mortgagee or its nominee commences cure of such default within such 30-day period and thereafter diligently prosecutes such cure to completion; provided. further, however, that University hereby acknowledges and agrees that, for the purpose ofthe requirements of this sentence, defaults of Lessee arising from a breach of any covenant relating to (x) the Required TNW Amount, and/or (y) the bankruptcy or insolvency of either Lessee or Guarantor, shall constitute defaults of Lessee which are not reasonably capable of being cured by Leasehold Mortgagee. The New Lease shall be effective at the date of such termination of this Lease and shall include only the covenants, agreements, conditions, provisions, restrictions and limitations contained in this Lease; provided. however, that the terms of such New Lease-shall provide that the provisions of clause (y) of item (i) of the definition of "Force Majeure" shall no longer apply. Concurrently with entering into any New Lease, University shall, by suitable conveyance, transfer to the Leasehold Mortgagee or its nominee title -to all improvements on the Leased Land,

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if any, which are encumbered by the lien of the Project Financing Documents and become vested in University as a direct result of University's termination of this Lease, as opposed to those portions of the Project for which title has vested in University (and for which Leasehold Mortgagee was to have released its lien) pursuant to the other terms of this Lease; provided, however, that any such transfer by University to Leasehold Mortgagee shall be subject to University's reversionary rights contained in this Lease. The Leasehold Mortgagee or any other purchaser at a foreclosure sale or other conveyance pursuant to rights under the Project Financing Documents (or the Leasehold Mortgagee or its nomin~ ifone of them enters into a New Lease with University) shall succeed to all the interest of Lessee in any amounts paid by Lessee to University under this Lease.

Section 16.8 Merger. So long as the Leasehold Mortgagee holds a Deed of Trust encumbering Lessee's Interest, the fee title to the Leased Land and the estate created by this, Lease, shall not merge unless the Leasehold Mortgagee expressly consents to the merger in writing. This provision shall apply even ·ifLessee or University or any third party acquires both the fee title and this Lease.

Section 16.9 No Modification. Etc. This Lease shall not, without the prior written consent oft~e Leasehold Mortgagee, be modified, amended, surrendered or terminated, with the exception of (i) termination at the expiration Of the Term of this Lease or pursuant to Section 15.3 above (but subject to the Leasehold Mortgagee's cure rights under this Article), (ii) a termimition pursuant to Article XI, (iii) a termination in connection with a purchase oithe Project by University pursuant to Article XU, or (iv)' a termination by the University pursuant to the termination rights available to the University under Section 17.4 below.

Section 16.10 Limitation on Leasehold Mortgagee Liabilitv. The Leasehold Mortgagee shall nO,t be liable to perform Lessee's obligations under this Lease, unless and until the Leasehold Mortgagee acquires this Lease or enters into a New Lease; provided, however, in no event shall Leasehold Mortgagee be liable for, nor obligated to payor perform in order to enjoy the rights and benefits of this Lease or any New Lease, any Leasehold Mortgagee Excluded Obligations. The liability of the Leasehold Mortgagee acquiring this Lease shall be limited to the Leasehold Mortgagee's interest,in this Lease acquired by Leasehold Mortgagee. The Leasehold Mortgagee shall not be liable for any such obligations under this Lease following the assignment of its interest under this Lease to any transferee in compliance with the terms of this Article XVI. An interest in a Deed of Trust securing any unpaid part of the purchase price for this Lease and related interests shall not be considered retention of an interest in this Lease for purposes of this Section 16.10.

Section 16.11 Conflict. In the event of any conflict between the provisions of this Article XVI and the other provisions of this Lease, the provisions of this Article XVI shall control.

Section 16.12 Leasehold Mortgagee Third Party Beneficiarv. Leasehold Mortgagee shall be an intended third party beneficiary of the terms of Section 7.3 and Articles X and XI related to any cap on Lessee's obligations to make payments and/or Lessee's interest in awards, proceeds and payments of casualty and condemnation and the allocation and use thereof.

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Le8:sehold Mortgagee shall also be an intended third party beneficiary of the terms of this Article XVI.

ARTICLE XVII ECONOMIC INFEASIBIUTY

Section 17.1 Certain Hazardous Substances. In connection with the discovery of any Hazardous Substance Condition with respect to the Leased Land which occurs prior to Completion of the Project (any such Hazardous Substance Condition, herein a "Pre-Completion Hazardous Condition''), Lessee shall cause the Environmental Consultant to prepare a Hazardous Substance Response Report, as provided in Section 4.4(b) above. If(A) the Hazardous Substance Response Report(s) with respect to such Pre-Completion Hazardous Condition disclose(s) that the cost to complete the work described in the Environmental Remediation Plan (including the cost of remediation of any Hazardous Substances which were on or about the Leased Land on the Master Lease Effective Date where such remediation is required by Applicable Law, Governmental Authorizations andlor the Entitlements Documents, except to the extent such costs of remediation result from or arise out of an exacerbation of the condition of such Hazardous Substances resulting from or arising out of the willful misconduct or the negligent acts, errors or omissions of any WVCP Parties, Sub-Phase Lessee Parties (other than Third Parties) andlor any Lessee Parties), will exceed Five Million Dollars ($5,000,000.00) in the case of any single Hazardous Substance Response Report, or Ten Million Dollars ($10,000,000.00) cumulatively with respect to all such Hazardous Substance Response Reports, (B) the subject Pre-Completion Hazardous Condition did not arise from or otherwise relate to the use, storage, handling, release, emission, discharge, generation, abatement, disposal or transportation of any Hazardous Substance on, in, under, near or emanating from the Leased Land or any of the Access Areas by any of the WVCP Parties andlor any Lessee Parties, and (C) the obligation for remediation of such Pre-Completion Hazardous Condition is not imposed upon University pursuant to the terms of this Lease or upon any Sub-Phase Lessee pursuant to the terms ofa Sub-Phase Lease, then Lessee shall have the right, exercisable in Lessee's sole and absolute discretion, to either (x) upon receipt of Leasehold Mortgagee's consent, if applicable pursuant to Section 16.9, terminate this Lease without any compensation from University, or (y) elect to permanently waive the right to terminate this Lease with respect to such Pre-Completion Hazardous Condition provided in the preceding item (x) and to proceed with development of the Project pursuant to the terms of this Lease without any compensation from University with respect to such Pre-Completion Hazardous Condition. Within ninety (90) days following Environmental Consultant's completion and delivery to University and Lessee of the Hazardous Substance Response Report showing .the Pre-Completion Hazardous Condition referenced in item (A) ofthe preceding sentence, Lessee shall provide Notice to University of its election pursuant to the preceding sentence; provided, however, if Lessee fails to provide Notice to University of its election pursuant to the preceding sentence within such ninety (90) day period, then Lessee shall be deemed to have elected to waive the right to terminate this Lease with respect to such Hazardous Substance Condition as provided in item (y) of the preceding sentence. If Lessee elects to, or is deemed to have elected to, proceed in accordance with item (y) of this Section 17.1, then Lessee shall execute such reasonable documents as University may reasonably request to memorialize the provisions of item (y) above, including, without limitation, an acknowledgement that the waiver and release set forth in Section 2.4(d) above extends to such Hazardous Substance Condition.

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(a) If Lessee elects to terminate this Lease pursuant to the rights granted to Lessee within this Article XVII, then on the Infeasibility Termination Date (1) Lessee shall surrender and vacate the Leased Land and all portions of the Project in the surrender condition required pursuant to Section 14.2 above, and (2) if the Project Financing Documents remain an encumbrance upon Lessee's Interest on the Infeasibility Termination Date, then Lessee shall cause Leasehold Mortgagee to immediately record a release of any security interest Leasehold Mortgagee has/had in Lessee's Interest, which release shall be accomplished through the recording in the Official Records of the County of a customary release document which has been approved by University in the exercise of its reasonable discretion. Upon satisfaction of the preceding item (1), this Lease shall terminate and all of Lessee's rights in the Leased Land, and every part thereof, and all of Lessee's rights in the Project, and every party thereof, shall terminate and Lessee's right, title and interest in the Project (including Lessee's right, title and interest in and to any Student Bed Sublease and any Commercial Sublease), the :Development Documents and the Deveiopment Agreements related to the Project shall automatically and without additional compensation to Lessee become the property and vest in University. Upon

. any termination of this Lease pursuant to this Section 17.1, Lessee shall execute such documents as University may reasonably request to metnorialize the termination of this Lease and the transfer to University of aU interests of Lessee in the Project (including Lessee's right, title and interest in and to any StudenfBed Sublease and any Commercial Sublease), the Development Documents 'and the Oevelopmertt Agreements.

Section 17 .2 Master Lease Termination Eyent. If (A) the Master Lease is terminated pursuant to the provis'ions of Section 10.2,-SectioD 17.1 or Section 17.2 thereof, and (8) as of the date of such termination, Lessee has not entered into any Commercial Su1:Jleases andlor Student B~d Subleases with respect to any portion of the Leased Land, then Lessee shall. have the right, exercisable in Lessee's sole and absolute discretion, to either (x) upon receipt of Leasehold Mortgagee's consent, if applicable pursuant to Section 16.9, terminate this Lease, or (y) elect to permanently waive the right to terminate this Lease with respect ,to such termination of the Master tease provided in the preceding item (x) and to proceed with development of the Project pursuant to the terms ofthis Lea$e without any compensation from University with respect to such termination of the Master Lease; provided, however,. if Lessee fails to provide Notice to University of its election within forty-five (45) days following receipt of Notice ofa termination of the Master Lease pursuant to the provisions of Section 17.1 or Section 17.2 thereo~ then Lessee shall be deemed to have elected to waive the right to terminate this Lease with respect to such termination of the MaSter Lease as provided in item (y) above. If Lessee elects to, or is deemed to have elected to, proceed in accordance with item (y) of this Section 17.2, then Lessee shall execute such reasonable documents as University may reasonably request to memorialize the provisions of item (y) above. If Lessee ele¢ts to terminate this Lease pursuant to the rights granted within item (x) of this Section -17.2, then on the Infeasibility Termination Date (1) Lessee shall surrender and vacate the Leased Land and all portions of the Project in the surrender condition required pursuant to Sectioil14.2 above, (2) Lessee shall pay University the Lessee Surrender Fee Payment (as defined below), and (3) if the Project Financing Documents remain an encumbrance upon Lessee's Interest on the date Lessee delivers the Notice of termination· pursuant to the preceding. sentence, then Lessee shall cause Leasehold Mortgagee to immediately record a release of any security interest Leasehold Mortgagee has/had in Lessee's Interest, which release shall be accomplished through the recording in the Official Records of the County of a customary release document which has been approved by University in the exercise

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) ofits reasonable discretion. Upon satisfaction of the preceding items (1) and (2), this Lease shall terminate and all of Lessee's rights in the Leased Land, and every part thereof, and all of Lessee's rights in the Project, and every part thereof, shall terminate and Lessee's right, title and interest in the Project, the Development Documents and the Development Agreements related to the Project shall automatically and without additional compensation to Lessee become the property and vest-in University. Upon any termination of this Lease pursuant to this Section 17.2, Lessee shall execute such documents as University may reasonably request to memorialize the termination of this Lease and the transfer to University of all interests of Lessee in the Project, the Development Documents and the Development Agreements. As used herein, the term "Lessee Surrender Fee Paymenf' shall mean an amount equal to any portion of the Net Awards and Payments received by, or to be received by, Lessee pursuant to the provisions of Article XI above.


Section 17.4 Certain Increased Costs. Without representation or warranty hereunder, University has informed Lessee that University has determined that (a) the Project does not involve the use of "public funds" (as such term is defined in CLC Section 1720(b) and that the Project is not a "public work" (as such term is defined in CLC Section 1720(a», and (b) the Project shall be exempt from the wage requirements set forth in University policies, whether adopted pursuant to the "internal University affairs" doctrine under Article IX, Section 9(a) of the California Constitution or otherwise. In connection with the foregoing, University acknowledges and agrees that the imposition of a requirement for payment of "prevailing wages" (as such term is defined in and used pursuant to CLC Sections 1771 through 1775) with respect to the development of any portion of the Project would create an economic hardship which would cause the Project to become economically infeasible to develop as contemplated by this Lease. Accordingly, in the event that the requirement for payment of any such ''prevailing wages" is imposed (whether pursuant to CLC Sections 1771 through 1775 or University policies) with respect to development of any portion of the Project, then the parties shall have the respective rights and obligations set forth in this Section 17.4. Notwithstanding the foregoing or anything to the contrary herein, Lessee hereby acknowledges and agrees that (x) the payment of any Lot Reimbursement Amounts (as defined below), and the determination of any such amount, is a separate and distinct matter from the terms of this Lease, the development of the Project by Lessee and the obligations of University hereunder, and (y) in no event shall the payment of any Lot Reimbursement Amount be considered in connection with the matters which are the subject of, or otherwise impose any liability or obligation upon University pursuant to, this Section 17.4, irrespective of any matters taken into consideration between Lessee and WVCP in determining any such Lot Reimbursement Amount. As used herein, the term "Lot Reimbursement Amonnf' shall mean an amount equal to the assumption fees, premiums, compensation, purchase amounts, or other payments or amounts paid to WVCP by Lessee in connection with the creation ofthis Lease between the University and Lessee and the grant to Lessee of the development rights contemplated pursuant to this Lease.

. (a) At University's sole cost and expense, University may, by appropriate legal proceedings brought in good faith and diligently prosecuted in its name, contest the validity or applicability to the Project, or any part thereof, of any Applicable Laws andlor University Regulations related to the imposition of "prevailing wages" (as such term is defined in and used

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pursuant to CLC Sections 1771 through 1775), including, without limitation, any such imposition based in whole or in part upon University policies, whether adopted pursuant to the "internal University affairs" doctrine under Article IX, Section 9(a) ofthe California Constitution or otherwise; provided. however, that (x) Lessee shall, at University's cost and expense, reasonably cooperate with University in connection with any such contest, and (y) to the extent necessary or reasonably appropriate, Lessee shall, without cost or expense to Lessee, join in any action with University and to the extent necessary permit such action to be maintained in the names of both University and Lessee, provided, that any such action shall be maintained without cost or expense to Lessee.

(b) Immediately upon receipt of any notice of action or proceeding alleging a violation of Applicable Laws and/or University Regulations related to the payment of "prevailing wages" as described within this Section 17.4, including, without limitation, any such .violation which is alleged to be based in whole or in part upon a violation of University policies, whether adopted. pursuant to the "internal University affairs" doctrine under Article IX, Section 9(a) of the California Constitution or otherwise, and seeking to enforce ~e payment of "prevailing wages", the recipient party, whether Lessee or University, shall give Notice to the other party of such claims.

(c) Except where Lessee elects to proceed with development of the Project as evidenced by delivery ofa Notice of Waiver (as defined and in the manner set forth below), irrespective of whether this Lease is terminated pursuant to this Section 17.4, University shall have the obligations set forth in SedioD 13.2 above with respect to the increased costs of labor actually incurred by Lessee as a result of the imposition of "prevailing wages", as described within this Section 17.4, with respect to any portion of the Project. Without limiting the foregoing, in the event .that the requirement for payment of any such "prevailing wages" is· imposed (whether pursuant to CLC Sections 1771 through 1775 or University policies) with respect to development of any portion of the Project, then University shall have the right, exercisable in University's sole and absolute discretion, to terminate this Lease upon Notice to Lessee; provided. however. Lessee may elect, in the exercise of Lessee's sole and absolute discretion, by written Notice delivered to University on or before the date which is ten (lO) Business Days following University's delivery ofa Notice oftennination pursuant to this Section 17.4(c) (Lessee's Notice, herein the "Notice of Waiver"), to assume all costs which arise out of or result from the imposition of "prevailing wages" with respect to the Project, including, without limitation, (x) any fines and/or penalties incurted by any Lessee Indemnitee in conpection with any action or proceeding described within Section 17.4(b), and (y) the increased costs described within this Section 17.4(c), in which case University shall no longer have the right to terminate this Lease pursuant to this Section 17.4(c) and any prior Notice oftermination shall be thereafter deemed to be superseded and be null, void and of no force or effect. Lessee hereby acknowledges and agrees that, upon Lessee's delivery of a Notice of Waiver, University and the University lndemnitees shall be released from all obligations in connection with the indemnity set forth in the last sentence of Section 13.2, including, without limitation, the provisions of clauses (x), (y) and (z) of said Section 13.2.

Section 17.5 Historical Resource ,or Unique Arcbaeological Resource. If either a unique archaeological resource or historical resource (herein, a ''Unique Resource") is discovered upon the Leased Land at any time durinQ the Tenn, then during performance of the

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Mitigation Measures Responsibilities the University shall make a determination (in the exercise of the University's sole and absolute discretion) of the method for preservation of such Unique Resource. Lessee and the University hereby acknowledge that if such Unique Resource will be preserved in the place where such Unique Resource was discovered, Lessee may be prevented from constructing a portion or portions of the Project intended to be located upon the Leased Land as originally planned. In such event and as a result thereot: if the University detennines . that the method for preservation of such Unique Resource will be to preserve such Unique Resource in the place where it was discovered, then the University shall use commercially reasonable efforts to identify real property adjacent to the Master Project Leased Land for use by Lessee in connection with the· construction ofthe Project which is intended to be substituted for the portion of the Leased Land which is affected by the preservation of such Unique Resource. Notwithstanding the foregoing or anything to the contrary herein, if University either identifies any such substitute real property for portions of the Leased Land as provided in the preceding sentence of this Sedion 17.5 or is unable to identify any such substitute real property, then Lessee shall have the right, exercisable in Lessee's sole and absolute discretion, to terminate this Lease upon receipt of Leasehold Mortgagee's consent, if applicable pursuant to Section 16.9, which tennination shall be effectuated by Notice to University delivered not more than sixty (60) days following Lessee's receipt of any such Notice from University either identifying any such substitute real property or stating University's inability, following commercially reasonable efforts, to identify any such substitute real property. If Lessee fails to exercise such right of tennination within sixty (60) days following receipt of the University'S Notice referenced in the preceding sentence, then such right of termination shall be null, void and of no further force or effect with respect to the substitution which is the subject of such Notice. Upon University's determination that a Unique Resource will be pres'erved in the place where such Unique Resource was discovered, if Lessee does not exercise the right to terminate this Lease as provided above, (I) Lessee and University shall enter into an amendment to this Lease whereby Lessee shall surrender and vacate the subject portion of the Leased Land in the surrender condition required pursuant to Section 14.2 above, (2) to the extent substitute real property is identified by the University, the identified substitute real property will be added to the Leased Land, and (3) if the Project Financing Documents remain an encumbrance upon Lessee's Interest at such time, then concurrently with the execution of such amendment Lessee shall cause Leasehold Mortgagee to immediately record an agreement releasing any security interest Leasehold Mortgagee haslhad in the subject portion of the Leased Land identified in item (1) above and, if applicable, substituting the real property identified in item (2) above as security for the Project Financing; provided, however, if the University is unable to provide substitute property or if the substitute property to be provided is not substantially equivalent in land area and accessibility to the Leased Land being surrendered, then the University and Lessee shall use commercially reasonable efforts to reach a mutually acceptable agreement relating to the impact upon this Lease of such substitUtion.

Section 17.6 Termination. If (i) University elects to terminate this Lease pursuant to the rights granted to University within Sedion 17.4 and such termination is not otherwise superseded as provided in Section 17.4( c), or (ii) Lessee elects to terminate this Lease pursuant to the rights granted to Lessee within Section 17.5 above, then on the Infeasibility Termination Date (1) Lessee shan surrender and vacate the Leased Land and all portions of the Project in the surrender condition required pursuant to Section 14.2 above, (2) University shall pay Lessee an amount equal to the Termination Fee Payment computed pursuant to the table set forth in

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Exhibh V attach~d hereto; provided. however, in no event shall Lessee and WVCP and/or any Sub-~hase Lessee receive a payment for such termination or any similar termination with respect to the Commercial Lots comprising the Leased Land, and (3) if the Project Financing Documents remain an encumbrance upon Lessee's Interest on the Infeasibility Terinination Date, then concurrently with payment of the Termination Fee Payment, Lessee shall cause Leasehold Mortgagee to immediately record a release of any security interest Leasehold Mortgagee has/had in Lessee's Interest, which release shall be accomplished through the recording in the Official Records of the County of a customary release document which has been approved by University in the exercise ofits reasonable discretion; provided, further, however. University hereby agrees for the sole benefit of Leasehold Mortgagee that, if the Infeasibility Termination Date occurs after a Certificate of Occupancy has been issued for any of the Buildings, then so long as (X) the subject Project Financing funded by such Leasehold Mortgagee complied with the provisions of items (i) or (ii), respectively, of Section 16.2 above at the time such Project Financing was entered into, and (Y) the University approved such Leasehold Mortgagee's statement of the Loan Allocation at the time the subject PJ'oject Financing Documents were entered into, the Termination Fee Payment with respect to each Building for which a Certificate of Occupancy has been issued as ofthe Infeasibility Termination Date shall be a minimum of the Floor Amount, rather than any lesser amount that may be computed with respect to such Building pursuant to the table set forth in Exhibit V attached hereto. Upon satisfaction of the preceding items (1) and (2); this Lease shall terminate and all of Lessee's rights in the Leased Land, and every part thereof, and all of Lessee's rights in the Project, and every part thereof, shall terminate and Lessee's right, title and interest in the Project (including Lessee's right, title.and interest in and to any Student Bed Sublease and any Commercial Sublease), the Development Documents and· the Development Agreements related to the Project shall automatically and without additional compensation to Lessee become the property and vest in University. Upon any termination of this Lease pursuant to this Section 17.4, Lessee shall execute such documents as University may reasonably request to memorialize the termination of this Lease and the transfer to University of all interests of Lessee in the Project (including Lessee's right, title and interest in and to any Student Bed Sublease and any Commercial Sublease), the Development Documents and the Development Agreements.

ARTICLEXvm QUIET ENJOYMENT

Without limiting any of the rights of University hereunder, including, without limitation, the terms ofSectioD 2.4 above and the reqledies afforded to University in Settion 15.3(a) above, Lessee shall lawfully, peaceably and quietly hol~ occupy and eqjoy the Leased Land without disturbance, interruption or hindrance by University, or any person or entity claiming by or through University. Univers'ity shall in no event be liable in damages or otherwise, nor shall Lessee be released from any obligation hereunder (except to the limited extent of any abatement of Basic Rent permitted pursuant to Section 5.1(1) above), because of the interruption of any service, or a termination, interruption or disturbanee attributable to an event of Force Majeure. Notwithstanding anything to the contrary herein, the University Indemnitees shall not be liable, under any circ~stances, for damage or inconvenience to Lessee's business or for any loss of income or profit therefrom, or for any consequential, indirect, incidental, special, punitive, or exemplary damages, notwithstanding that any of the University Indemnitees have been informed

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ARTICLE XIX EQUAL ,OPPORTUNITY

Section 19.1 Lessee's Obligations. Neither Lessee or Lessee's contractors, agents or invitees shall discriminate against any person employed or seeking employment on the Leased Land because of race, color, marital st~s, age, religion, sex, sexual orientation, handicap or national origin. Lessee shall, by policy and action, ensure that, and Lessee shall use commercially reasonable efforts to cause all other Lessee Parties to ensure that, all persons employed by such parties or seeking employment from them on the Leased Land are treated without regard to race, color, marital status, age, religion, sex, sexual orientation, handicap or national origin. Such action shall include, but shall not be limited to, the following: hiring, upgrading, transfer or demotion, testing or placement, recruitment or recruitment advertising, layoff or termination, rates of payor other forms of compensation, overtime or shift assignments, as well as selection for training, including apprenticeship. All contracts between Lessee and its contractors, agents and invitees shall contain a provision obiigating the parties thereto to comply with the terms of this Section 19.1.

Section 19.2 Universitv's Right and Remedies. In the event Lessee or Lessee's contractors, agents or invitees fail to comply with the terms of Section 19.1 above and Lessee fails to cure such failure within sixty (60) days following written notification by University, University may bring judicial action against Lessee to compel compliance or to recover any actual damages proximately caused by Lessee's noncompliance with the terms of this Article XIX.


ARTICLE XX RESERVED

ARTICLE XXI MISCELLANEOUS

Secthm 21.1 Notices. All notices, statutory notices, demands, statements or communications (collectively, "Notices") given or required to be given by either party to the other hereunder shall be in writing, and shall be (i) sent by United States certified or registered mail, postage prepaid, return receipt requested, or (ii) sent by recognized overnight delivery service (such as, but not limited to, Federal Express, DHL or UPS) with tracking capability, or (iii) sent by facsimile transmission, so long as the facsimile machine of the sender produces a written confirmation of such transmission and a copy of such notice, demand, statement or other communications is deposited in the United States mail on the same day as it is sent by facsimile, or (iv) delivered personally, in each case addressed as follows: (a) to Lessee at the. appropriate address set forth below, or to such other place as Lessee may from time to time designate in a Notice to University; or (b) to University at the addresses set forth below, or to such other firm or to such other place as University may from time to time designate in a Notice to Lessee.

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Any Notice will be deemed given (w) on. the day three (3) Business Days following the date on the date it was deposited in the United States Mail as provided in this Section 21.1, or (x) on the Business Day following deposit with a recognized overnight delivery service (delivery charges prepaid or billed to sender) for next Busipess Day delivery, or (y) on the same day, if sent by facsimile transmission prior to 5:00 p.m. in the time zone of the recipient, with a written confirmation produced by the facsimile machine of the sender, and so long as a copy of such notice, demand, statement or other communication is deposited with a recognized national overnight delivery service with tracking capability on the same day, or (z) on the date personal delivery is made, if given by personal delivery. Notices shall be sent to the following addresses, or to such other address in the United States as University or Lessee may from time to time designate by like Notice.

If to University:

with a copy to:

and to:

and to:

If to Lessee:

with a copy to:

OHS West:260944943.1

Real Estate Services University of California, Davis One Shields Avenue Davis, California 95616-8678 Attention: Executive Director, Real Estate Services

Real Estate Services Group The Regents of the University of California 1111 Franklin Street, 6th Floor Oakland, California 94607 Attn: Director, Real Estate Services

Office of the General' Counsel University of California 1111 Franklin Street, 8th Floor Oakland, California 94607 Attention: James D. Agate, Esq.

Orrick, Herrington & Sutcliffe LLP The Orrick Building 405 Howard Street San Francisco, California 94105 Attention: Stephan C. Wagner

WVCP Cluster 1, LLC c/o CP West Village, LLC 1000 Sansome Street, Suite 180 San Francisco, CA 94111 Attention: Nolan Zail

Urban Villages, Inc. 1555 Blake Street, Suite 450

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and to:

and also to:

Denver, Colorado 80202 Attention: Stina Johnson, Esq.

CP Investment Fund n, L.P. 1000 Sansome Street, Suite 180 San Francisco, CA 94111 Attention: Nolan Zail

Sheppard, Mullin, Richter & Hampton LLP Four Embarcadero Center, 17th Floor San Francisco, CA 94111 Attention: Robert Thompson, Esq.

University or Lessee shall provide notification of change of address by registered or certified mail, return receipts requested. Any Notice of default sent to Lessee hereunder shall be simultaneously sent to each Leasehold Mortgagee, provided that University has been given such Notice as is required by Section 16.4, by registered or certified mail, return receipt requested, at the address or addresses previously provided by Lessee.

Sec::tion 21.2 Brokerage Commissions. University and Lessee each represents and warrants to the other that neither it nor its officers or agents nor anyone acting on its behalf has dealt with any real estate broker in the negotiating or making of this Lease. Lessee shall be responsible, at Lessee's sole cost and expense, for any brokerage commission or similar payment or fee in connection with any Student Bed Sublease, any Commercial Sublease and/or any sale, transfer or other encumbrance of Lessee's Interest.

Sedion 21.3 Nonmerger of Fee and Leasehold Estates. Ifunder any circumstances both University's and Lessee's estates in the Leased Land, or any portions thereat: become vested in the same owner, this Lease nevertheless shall not be extinguished by application of the doctrine of merger except at the expres~ election of the owner and with the express written consent of the beneficiary or beneficiaries under any Deed of Trust affecting the Leased Land and Lessee's leasehold estate.

Sedion 21.4 Entry of Leased Land by UniverSity. In addition to the rights of inspection granted to University pursuant to Sec::tion 4.4 and Sec::tion 5.9, representatives of University may enter the Leased Land, including any portion of the Project, during ·normal business hours for the purpose ofinspection; provided, however, that in connection with any such entry, the University representatives shaH comply with the reasonable health, safety and security requirements of Lessee and Lessee's Contractor. University shall give Lessee forty-eight (48) hours prior verbal notice of such entry, except in the case of an emergency. Notwithstanding the foregoing or anything to the contrary herein, Lessee acknowledges that public health and safety personnel retained by University,' including, without limitation, fire, police and other life safety professionals, may enter the Leased Land at any time in the course of performing their duties for the University, whether or not such persons are then currently on "active duty" or "off duty" and no such access by such professionals shall constitute any interference with or disruption ofLessee's use, occupancy or enjoyment of the Leased Land or

OHS Wcst:260944943.1 -103-

interference with or disruption of any of Lessee's rights under this Lease, nor otherwise entitle Lessee to any compensation or damages.

Section 21.S Force Majeure Delay. Notwithstanding any other provision of this Lease to the contrary, if either party shall be delayed or prevented from completing the performance of any act required by this Lease within the timefrarne required hereunder as a result of an event constituting Force Majeure, then performance of such act shall be excused for a period equivalent to the period such Force Majeure continues to delay or prevent such performance; provided, however, as a condition to claiming the benefit of any such additional time for performance due to an event of Force Majeure, the party so delayed or prevented from performance shall notify the other party of such event of Force Majeure within fifteen (15) days of the delayed party's knowledge thereOf and the nature ofits impact upon such party's performance and shall thereafter keep the other party regularly btformed of the status of such event of Force Majeure.

Section 21.6 Time of the Essence. Time limits in this Lease are to be strictly observed. Time is of the essence in the performance of each and every obligation and covenant of the parties thereon.

Section 21.7 Waiver. No waiver by either University or Lessee at any time of any of the terms, conditions, or covenants of this Lease shall constitute a later waiver of the same or any other term, condition, or covenant of this Lease, nor of the strict and prompt performance thereof by such party. Except as expressly provided in this Lease, neither party's delay, failure, or omission to exercise any right, power, privilege, option, or remedy arising from any default, shall impair such right, power, privilege, option, or remedy which such party has nor be construed as such party's waiver or relinquishment of any such right, power, privilege, option, or its acquiescence to a default. Neither PartY shall be required to give Notice in order to restore or revive either (i) time as of the essence hereof, or (ii) any other covenant or condition, after such party has waived a default in one or 111,0re instances. No right, power, privilege, option, or remedy of either party shall be· construed as being exhausted or discharged by the exercise thereof in one or more instances.

Section 21.8 Captions. The captions and section headings used herein are for convenience only and are not a part of this Lease and do not in any way limit Or amplify the terms and provisions hereof.

Section 21.9 Goyerning Law. this Lease shall be interpreted in accordance with and governed by the laws of the State of California. The language in all parts of this Lease shall be, in all cases, construed according to its fair meaning and not strictly for or against University or Lessee.

Section 21.10 Entire Agreement. This Lease together with the Exhibits hereto contain all covenants, terms, provisions and agreements between University and Lessee relating in any manner to the construction, rental, use, and occupancy of the Leased Land and other matters set forth in this Lease. No prior agreement Or understanding with respect to the same shall be valid or of any force or effect, and no covenant, term, provision or agreement of this Lease can be altered, changed, modified or added to, except in writing, signed by University and Lessee. No

OHS West260944943.1 -104·

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representation, inducement understanding, or anything of any nature whatsoever made, stated, or represented on behalf of either party hereto, either orally or in writing, has induced either party to enter into this Lease except as set forth in this Lease.

Section 21.11 Right to Reguest'lnjunction. In the event of any violation or threatened violation by either party of any of the terms, covenants, and conditions herein contained, in addition.to the other remedies herein provided, each party shall have the right to petition for injunctive relief against such violation or threatened violation in a court of competent jurisdiction.

Section 21.12 Severability. lfany clause, sentence or other portions of this Lease shall become illegal, null or void for any reason, or shall be held by any court of competent jurisdiction or be so, the remaining portions thereof shall remain in full force and effect.

Section 21.13 Interest Rate to be Paid. Whenever in this Lease interest is to be paid by one party to the other on amounts due from the paying party to the other party~ unless otherwise provided in this Lease, the interest rate shall be the lesser of (i) five percent (5%) per year plus the rate the Federal Reserve Bank of San Francisco charges on. advances from time to time, or (ii) the maximum rate permitted by Applicable Laws, until such sum is paid.

Section 21.14 Representations and Warranties by Lessee. As a material inducement to University to enter into this Lease, Lessee represents and warrants the following:

) (a) Power and Authority. That it is duly organized, validly existing and in good standing under the laws of the State of its formation, and, is duly qualified to do business and. is in good standing in the State of California; that it has all necessary power and authority to enter into this Lease and to carry out the transactions contemplated herein; and that the execution and delivery hereof and the performance by Lessee of Lessee's obligations hereunder will not violate or constitute a Lessee Default under the terms and provisions of any agreement, law or court order to which Lessee is a party or by which Lessee is bound the remedy for which default would have a material adverse effect on Lessee's ability to perform its obligations hereunder.

(b) Authorization. Valid Obligations. That all actions required to be taken by or on behalf of Lessee to authorize it to execute, deliver and perform its obligations under this Lease have been taken, and that this Lease is a valid and binding obligation of Lessee enforceable in accordance with its terms, except as the same may be affected by bankruptcy, insolvency, moratorium or similar laws, or by legal or equitable principles relating to or limiting the rights of contracting parties generally.

(c) Executing Parties. That the persons executing this Lease on behalf of Lessee have full power and authority to bind Lessee to the terms hereof.

(d) Power and Authority of Guarantor. That Guarantor is duly organized, validly existing and in good standing under the laws of the State oftbe Guarantor's formation and, is duly qualified to do business and is in good standing in the State of California; that it has all necessary power and authority to enter into the Guaranty and to carry out the transactions contemplated therein; and that the execution and delivery of the Guaranty and the performance by Guarantor of its obligations thereunder will not violate or constitute a Lessee Default under

OHS Wcst:260944943.1 -105-

the terms and provisions of any agreement, law or court order to which Guarantor is a party or by which Guarantor is bound the remedy for which default would have a material adverse effect on Guarantor's ability to perform its obligations under the Guaranty.

(e) Authorization of Guarantor. Valid Obligations. That all actions required to be taken by or on behalf of Guarantor to authorize it to execute, deliver and perform its obligations under the Guaranty have, been taken, and that the Guaranty is a valid and binding obligation of Guarantor enforceable in accordance with its terms, except as the same may be affected by bankruptcy, insolvency, moratorium or similar laws, or by legal or equitable principles relating to or limiting the rights of contracting parties generally.

(t) Executing Parties of Guaranty. That the persoJ.ls executing the Guaranty on behalf of Guarantor have full power and authority to bind Guarantor to the terms of the Guaranty. .

Section 21.15 Representations and Warranties by University. As a material inducement to Lessee to enter into this Lease, University represents and warrants 'the following:

(a) Power and AuthOrity. That it is a California public corporation, duly organized, validly existing and in good standing under the laws of the State of California; that it has all necessary power ·and auth~rity to enter into this Lease and to carry out the transactions contemplated herein; and that the execution and delivery hereof and the performance by University of University's obligations hereunder will not violate or constitute a University Default under the terms and provisions of any agreement, law or court order to which University is a party or by which University is bound the remedy for which default would have a material adverse effect on'University's ability to perform its obligations hereunder.

(b) Authorization. valid Obligations. That all actions required to be taken by or on behalf of University to authorize it to execute, deliver and perform its obligations under this Lease have been taken, and that this Lease is a valid and binding obligation of University, enforceable in accordance with its terms except as the same may be affected by bankruptcy, insolvericy, moratorium or similar laws, or by legal or equitable principles relating to or limiting the rights of contracting parties generally.

(c) Executing Parties. That the persons executing this Lease on behalf of University have full power and authority to bind University to the terms hereof.

Section 21.16 Relationship of Parties. Nothing contained in this Lease or any of the Exhibits attached hereto shall be deemed or construed by the parties or by any third person to create the relationship of principal and agent, or of partnership or of joint venture, or of any association between University and Lessee, and none of the provisions contained in this Lease or any of the Exhibits attached hereto or any acts ofthe parties shall be deemed to create any relationship other than lessor and lessee between University and Lessee, nor shall this Lease be construed, except as expressly provided, to authorize either to act as agent for the other.

Section 21.17 Attorneys' Fees and Costs. In the event University or Lessee commences any action at law or equity against the other to enforce rights under this Lease, the

oHS Wcst:260944943.1

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prevailing party shall recover from the other party reasonable attorneys' fees, charges and costs (including the allocated cost of staff counsel of University).

Section 21.18 Survival of Covenants. All covenants which, by their terms, are not to be perfonned before the expiration or earlier tennination of this Lease shall survive the expiration or earlier tennination hereof.

Section 21.19 Binding Effect. The provisions of this Lease shall bind or benefit the heirs, executors, administrators, successors and assigns ofthe original parties to this Lease.

Section 21.20 Execution in Counterparts. This Lease may be executed in counterparts, each of which shall constitute an original of such Lease, but all of which shall constitute one and the same instrument.

Section 21.21 Memorandum of Lease. ConcUlTently with the execution of this Lease, the parties shall execute and acknowledge a Memorandum of Lease substantially in the form attached hereto as Exhibit Q, which memorandum shall be filed in the Official Records.

Section 21.22 Press Releases. University and Lessee shall use good faith efforts to coordinate with each other, as much as is reasonably practicable, any press releases issued with respect to the execution of this Lease, the Project, the future completion and opening of any of the Buildings comprising the Project and any future joint projects and operations between University and Lessee relating to the Master Project Leased Land and the use thereof, if any. Any violation of this provision by either University or Lessee shall not constitute a default under this Lease.

[EXECUTION PAGE FOLLOWS]

OHS West:260944943.1 -107-

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

UNIVERSITY: THE REGENTS OF THE UNIVERSITY OF CALIFORNIA,

OHS Wcst:260944943.1

a California public corporation on behalf of the Davis Campus

By: ______________________ __

Name: Its:

APPROVED AS TO FORM

By: Name: James D. Agate

University Counsel Of The Regents Of The University· Of CaUfornja

LESSEE: WVCP CLUSTER 1, LLC, a Delaware limited liability company

By: WEST VILLAGE COMMUNITY PARTNERSHIP 11, LLC, a Delaware limited liability company, . its Managing Member

By: CP WEST vaLAGE II, LLC, a California limited liability company, its Manager

By; CP INVESTMENT II REff,

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a Maryland real estate investment trust, its Managing Member

BY:~~

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

UNIVERSITY: THE REGENTS OF THE UNIVERSITY OF CALIFORNIA,

OHS West:260944943,J

a California public corporation on behalf of the Davis Campus

By:

Natn~e: FlSt== Its: ----i

APPROVED AS TO FORM

By: ~ 7) t/!fl': Name: j3iUes D. Agate

University Counsel Of The Regents Of The University Of California

LESSEE: WVCP CLUSTER 1, LLC, a Delaware limited liability company

By: WEST VILLAGE COMMUNITY PARTNERSHIP II, LLC, a Delaware limited liability company, its Managing Member

By: CP WEST VILLAGE II, LLC, a Califonlia limited liability company, its Manager

By: CP INVESTMENT II REIT, a Maryland real estate investment trust, its Managing Member

By: __ ~~~~~~ ________ _ Ron Zeff, President

EXHIBIT A-I

SUBDIVISION MAP

Amended Subdivision Map No. 4947 recorded May 14,2010, Book of Maps 2010, Pages 32 - 53 in the Official Records of the County Recorder of the County of Yolo, State of California.

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Cluster 1

EXHmITA-2

DESCRIPTION OF LEASED LAND AREA Cluster 1

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EXHIBIT A-3

DESCRIPTION OF LAND USES

Village Square

Community College

_ Mixed-Use

Student Housing

I '·::-;:-1 For-sale Faculty/Staff Housing

lIIIJ For-sale Market Rate Housing

_ Pre-School! Day Care

.. Parks and Open Space ExhibitA-3 Page I of2

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Cluster 1 51 + 56

• Cluster 2 52

Cluster 3 53 + 54

D Cluster 4 Mixed Use

Cluster 5 57 + 58

IliJ Cluster 8 UR

ExmBIT A-3

DESCRIPTION OF LAND USES Cluster Diagram

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EXHIBITB

PROPERTY MANAGEMENT STANDARDS

Lessee shall be responsible for overall management of the Project. Lessee shall perform its obligations under this Section, or cause them to be performed, in a manner which demonstrates managerial skill, knowledge, judgment and practice which is standard for the management of Comparable Improvements (defined as residential multi-tenant facilities, public or private, in the Davis area which are maintained in first class condition and serve similar resident populations). Lessee acknowledges University's concern that because the Project is located on the University's property, it must be operated, maintained and managed in first-class condition, habitability and repair and otherwise in a clean, attractive, secure and safe order so that at all times during the Lease Term the Project is reasonably attractive to University's students desiring residential housing, without consideration of design, location and age, and that University, in agreeing to the terms of this Lease, is relying on the expertise, experience and reputation of Lessee, to cause the Project to be operated, maintained and managed in the aforementioned condition. Lessee shall perform or cause to be performed, at its expense, property management services including those which are customarily provided at Comparable Improvements ("Property Management Services"). Thes~ services shall include, but not be limited to the following:

a. Exertion by Lessee of its commercially reasonable efforts to furnish the services of its ) organization and to exercise the highest degree of professional competence in managing the property;

b. Training of all on-site and off-site employees involved with the Project with respect to the neighborhood, layout, location, character and operation of the Project as well as University policies, procedures, and processes that impact the operation of the Project;

c. Use of commercially reasonable efforts to lease, operate and maintain the Project , within the scope defined above;

d. Negotiation of all leases for the Project;

e. Collection of tenant rents and all charges from tenants within the Project and other income from the Project, handling of all inquiries or requests of tenants and when deemed necessary, dispossession of tenants from the Project;

f. Supervision of tenants moving in and out of the Project so that there is a minimum of disturbance to the operation of the Project;

g. Compliance with all terms and conditions of the obligations of Lessee under any lease or other agreement executed by Lessee which shall relate to any matters connected with renting, operating or managing the Project unless prevented from so doing by some act beyond Lessee's reasonable control;

ExhibitB Page 10f3

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h. Arrangement for an advertising and public relations program for the Project;

i. Supervision, hiring and discharge of all personnel employed at the Project as employees of or under the exclusive control of Lessee or its agents, including use of reasonable care in the selection of such employees. Lessee or its agents shall be responsible for the actions and omissions of such personnel and be responsible for complying with all employment laws app~icable to its employees involved with the Project. All labor and employees are employees of the Lessee or its agents and not of University and the Lessee shall indemnify and hold harmless and, at University's request, defend from and against any and all claims based on the allegation that such labor and personnel "were labor and personnel of University;

j. Arrangement of contracts for electricity, gas, water, steam, telephone, cleaning, window cleaning, vermin extermination, elevator, boiler maintenance, building maintenance, landscape maintenance, trash collection, electronic surveillance and any other services as are customarily provided in Comparable Improvements or as Lessee deems advisable, and for the purchase of all materials and supplies necessary to maintain and operate the Project;

k. Arrangement for the provision of services and facilities of any maintenance engineering department that Lessee or its affiliates may have in connection with the operation of all mechanical installations; "

I. Rendering of operating and financial statements, and in connection therewith, maintenance of customary billing, collection and reporting systems and provision of reports required by the Lease, the Project lender or governmental agencies;

m. Confer fully and freely with the University in regards to performance of Lessee's responsibilities and update the University no less frequently than every three (3) months as to the status of the facilities and the operations

n. Lessee shall at aU times comply with Applicable Law. Lessee shall comply promptly with any and all orders, notices, or requirements regarding the Project from any federal, state, county or municipal authority, and will promptly and in no event, later that forty-eight hours from the time of receipt, notify the University in writing of aU such orders, notices or requirements. Lessee assumes all costs and liability associated with any negligent or willful acts or omissions made by Lessee which subjects, or which has the effect of subjecting the Project to the jurisdiction of any governmental agency, body, statute, ordinance, rule or regulation which the University would not have otherwise been subject.

ExhibitB Page 2 of3

In recognition of the fact that most Priority Residents of the Project are students, Lessee agrees that it shall and shall cause its Property Manager, if any, to comply with the following:

1. Respect students and to treat students in a dignified and polite manner;

2. Create, foster ~nd maintain a living environment within the Project that complements the University's academic mission;

3. Be sensitive to and assist students in transitioning into campus life;

4. Refer students with extraordinary or special circumstances to the University's housing department before taking other remedial actions against such students;

5. Provide a level of professionalism and dedication to serving University students equal to that provided by University housing staff to its student tenants;

6. Implement a procedure for working together with the University to maintain the highest level of consistency in processes, programs, and student life issues.

If Lessee should hire a Property Manager for the Project, (i) Lessee shall provide written notice to University, and University shall have a period of 10 days to disapprove such Property Manager provided that University's approval shall not be unreasonably withheld, and (ii) the Property Management Services shall be included in a written property management agreement between such Property Manager and Lessee, a copy of which shall be provided to University upon execution thereof. Any Property Manager hired by Lessee shaH be experienced in the management and operation of projects similar to the Project. Lessee has ultimate hiring authority for Property Manager(s). Lessee agrees to include a representative ofthe Student Housing Office and to consider the recommendations of such representative in the process of selecting such Property Manager(s). No such agreement with a Property Manager to provide the services described in this section shaH release Lessee from any obligation which Lessee has under this Lease. Lessee shall supervise Property Manager in all matters coming within the terms of this Section.

ExhibitB Page 3 of3

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EXBWITC

ADDITIONAL MA1NTENANCE AND REPAIR OBLIGATIONS

Maintenance Area shall be maintained in first class condition and otherwise in good, clean, attractive, sanitary and safe order condition and repair comparable to other public or private facilities in the Davis area which are maintained in first class condition and serve similar resident and! or student populations . Maintenance and repair obligations are for above grade Delivered Infrastructure, and not any below grade infrastructure.

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I I I I (

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Y 1\,, ____ -HUTCHISON DRIVE -.. ................ .-~--~--,-.. .... --... -". .."';" -

Maintenance and Repair Obligations are the responsibility of the Subphase Lessee for each Student Housing Cluster except where noted;

• 119

D

Cluster 1 (S1 & S6)

Cluster 2 (S2)

Cluster 3 (83 & S4) Prior to execution of Cluster 3 Subphase Lease, Cluster 2 will assume maintenance obligations.

Cluster 4 (Mixed Use)

Cluster 5 (87 & S8) Prior to execution of Cluster 5 Subphase Lease, Cluster 4 will assume maintenance obligations.

Cluster 6 (LlR) No maintenance obligations

ExhibitC Page I of I

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Exhibit D: West Village Permit Review Process

Site Infrastructure Improvement Plans

Plal,!S",.vIewed'by: - ME

- SWPPP'~

been lIPPfOVI.d bYRWQC8

PnHlonStruction -~ mitigatiOn has been addr8sseCI

Grading , Permit Issued

~ . eriVlrohmen1aI ";~nh8s ---

J..· '·"~'T ...: b6en 8ci,<hSled-

Si18 'ImprovamMt Penniti~

I •. T . ~.- , I up to 20 business days for DD

Initial submittal- Review and approve! disapprove: up to 25 business days for CD Resubmittal- Review and approve! disapprove: up to 5 business days for CD

Approve: If plans meet requirements, then Permit will be issued within 1 business day of final review. Disapprove: If plans do not meet requirements, reasons for disapproval will be provided in writing.

u

Inspections (by A&E, FM andJ

or 3"' Party)

'Review gaotachnicaI , report for sol compaction

Reviewsurwyor report for, elevation

-cheCks

[~~-I

• l:ItiIiIIes Instalations • UtII~ Cnxns • Irrigation • PIantII:Iard8cape

Matarials • Univ: review of MatariaJs testing

• Other?

I I within 1 business day

(request must be submitted before 3pm for

next day inspection)

A&E.I FM issue ·CertIfiCate of, SUbstantial

~on·wtth Punch-List

ffworlc meets requirements, then

Certificate will be issued within 5 business days

of final inspection

June 23, 2008 I 1 of 2

J

~

"jfoundation . ,P8imits issued

.~,~

• File Marshal

I~-""- I

up to 20 business days for DD

Initial submittal- Review and approve! disapprove: up to 25 business days for CD Resubmittal- Review and approve! disapprove: up to 5 business days for CD

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Exhibit D: West Village Permit Review Process

Building Construction Plans

Inspections (by A&E, FM andl

or 3"1 Party)

Un~nMewof Materials tasting

[-.. - .. _.- ----1 Bldg .Consf!uctlon

. -,-(Code qamplianoe)

F88'~ Inspectioi;s

UnMnltylnMew.of Materi8ls~

~fMi88ue "Certificate 'of

l~ ' ~ tDiCondItionsI

Punch LiSt

Approve: If plans meet requirements, then Permit wiff be issued within 1 business day of final review.

.... 'n' ........ dayl (request must be submitted

before 3pm for next day inspection)

If buHding meets requirements, then

Certificate will be issued within 5 bus/ness days

of final inspection Disapprove: If plans do not meet requirements, reasons for disapproval wiff be provided in writing.

June 23, 2008 I 2 of 2

WEST VILLAGE UNIVERSITY OF CALIFORNIA, DAVIS

BUILDING PERMIT APPLICATION Applicant to complete numbered spaces only.

JOB ADDRESS

1 LEGAl OESeR. I LOT NO. BLOCI< SUBOIV.

2 OWNER MAIL ADDijESS ZIP

3 CONrRAC:rOR MAlLADD.RESS PHONE

4 ARCHITECT OR MAIL ADDRESS PHONE' DESIGNER

5 ENGINEER MAIL ADDRESS PHONE I

6 USE OF BUILDING

7 I CI.J\SS OF 'MlRK: NEW REMOVE

8 DESCRIBE \NORK:

9 S{'ECIAL CONDITIONS:

TtPEOF OCCUPANCY CONST. GROUP

~0f8L0G. NO. OF (TOTAL) SQ. FT. STORIES

use ZONE

APPUCATIOf\I """"'"" .~ BY J PlANS CHECKED BY APPROVED FOR ~:OF OF~TREET PARtaIolG SPACEs: SERVICESV DWElUNG UNITS COVERED UNCOVERED

~A1.8 REQUIREO RECEIVED

HEALTH DEPT.

FIRE DEPT.

SOIL REPORT

OTHEij (SPECIFy)

SIGNTURE OF HOMEBUILDER OR AUTHORIZED AGENT _{DATE}

PHONE

UCENSENO.

UCENSENO.

,UCENSENO.

DIVISION

I~:I.OAD

=U~NKlERS

YES NO

NOT REQUIReD

WHEN PROPERL Y VALIDATED (IN THIS SPACE), TmS IS YOUR PERMIT PLAN CHECK VAUDATION PERMITVAUDATION

INSPECTO.R

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JaSn aJowa~

ll:tl ll/l~/lO JPd-[ l]uO!SSas

Non-Profit Checking Account number: 6349572609 • March 26, 2010 - April 27, 2010 • Page 1 of 3

ALLIANCE FOR LABOR STANDARDS EDUCATION AND TRAINING 1001 MARINA VILLAGE PKWY STE 200 ALAMEDA CA 94501-6430

Your Business and Wells Fargo As our way of saying thank you to our business customers, Wells Fargo is

extending our best money-saving offers on many of our business products and

services during the months of May and June. Stop by any Wells Fargo banking

location during May and June for details. Or visit us online at wellsfargo.com/biz.

Wells Fargo is an Equal Housing Lender.

Activity summary Beginning balance on 3126

Deposits/Credits

WithdrawalslDebits

Ending balance on 4127

Average ledger balance this period

Overdraft Protection

$24,389.32

675.45

- 2,744.65

$22,320.12

$23,594.26

This account is not currenUy covered by Overdraft Protection. If you would like more information regarding Overdraft Protection and

eligibility requirements please call the number listed at the top of your statement or visit your Wells Fargo store.

Img=2

(114) Ins =4 Sheet Seq = 0008710 Sheet 00001 of 00003

Questions?

Available by phone 24 hours a day, 7 days a week:

1-800-CALL-WELLS (1-800-225-5935)

TTY: 1-800-877-4833

En espano/: 1-877-337-7454

Online: wellsfargo.com/biz

Write: Wells Fargo Bank, N.A. (114)

P.O. Box 6995

Portland, OR 97228-6995

Account options A check ma/1( in tha box indicatas you have these convenient services with your account. Go to wellsfargo.comlbiz or call the number above if you have questions or if you would like to add new services.

Business Online Banking

Rewards for Business Check Card

Online Statements

Business Bill Pay

Business Spending Report

Overdraft Protection

Account number. 6349572609

ALLIANCE FOR LABOR STANDARDS EDUCATION AND TRAINING

Califomia account terms and conditions apply

For Direct Deposit and Automatic Payments use

Routing Number (RTN): 121042882

For Wire Transfers use

Routing Number (RTN): 121000248

lZl o o lZl lZl o

Account number: 6349572609 • March 26, 2010 - April 27, 2010 • Page 2 of 3

Transaction history

Check Date Number 4/12

4114 1064 4/16 1063 4126

4/27

4/27 4/27

EndIng balance on 4127

Totals

Description ATM Check Deposit- 04/12 Mach 10 0129C 2959 College Ave

8er\(eI~ CA 4406 Check Check POS Purchase - 04/26 Mach 10 000000 Piedmont

Grocereiedmont Goakland CA 4406 ?McC=5411 121042882DA

ATM Check Deposit - 04/27 Mach 1099678 Alameda Marina Alameda CA 4406 Monthly Check Retumllmage Slmt Fee Monthlx, Maintenance Fee - No Online Statement

Deposits! Wdhdrawals! Ending daily

Credits Debits balance

390.00 24,779.32

34.50 24,744.82

2,686.81 22,058.Q1 18.84 22,039.17

285.45

2.00 2.50 22,320.12

22,320.12

$675.45 $2,744.65

The Ending Daily Balance does not reflect any pending withdrawals or holds on deposited funds that may have been outstanding on your account when your transactions posted. If you had insufficient available funds when a transaction posted, fees may have been assessed.

Summary of checks written (checks listed are also displayed in the preceding Transaction history)

Number Date Amount Number Date Amount

1063 4/16 2,686.81 1064 4/14 34.50

As a valued non-profit customer, you can save $2.50 off the monthly maintenance lee lor your account il you sign up lor an online

statement and discontinue your paper statement. For more inlormation about online statements, call 1-800-956-4442, option 2, or go

online to wellsfargo.comlbiz and click on Enroll Now under the Online Banking button.

Ii IMPORTANT ACCOUNT INFORMATION

On July 1, 2010, changes to the lollowing lees will be effective:

- The CashedlDeposited Item Returned Unpaid lee will be $12.00 per item.

- Statement with Check Image Service:

- Classic (up to 10 per page, front 01 checks only) - $2.00 per month;

- Premium (up to 5 per page, front and back of checks) - $3.50 per month.

- Wells Fargo Check Card Transaction Fees: The Check Card Over-the-Counter lee will be 3% of the transaction amount for

international transactions. The lee for domestic (U.S.) Check Card Over-the-Counter Cash Disbursement will remain $3.00.

For questions, contact your Business Banker or call the phone number at the top 01 your statement.

Sheet Seq = 0008711 Sheet 00002 of 00003

Account number: 6349572609 • March 26, 2010 - April 27, 2010 • Page 3 of 3

General statement policies for Wells Fargo Bank

• Notice: Wells Fargo Bank, N.A. may fumish information about accounts belonging to individuals, including sole proprietorships, to consumer reporting agencies. If this applies to you, you have the right to dispute the accuracy of information that we have reported by writing to us at: Overdraft

Collections and Recovery, P.O. Box 5058, Portland, OR 97208-5058.

Account Balance Calculation Worksheet

1. Use the following worksheet to calculate your overall account balance.

2. Go through your register and mark each check, withdrawal, ATM transaction, payment, deposit or other credit listed on your statement.

Be sure that your register shows any interest paid Into your account and

any service charges, automatic payments or A TM transactions withdrawn

from your account during this statement period.

3. Use the chart to the right to list any deposits, transfers to your account, outstanding checks, ATM withdrawals, ATM payments or any other withdrawals (including any from previous months) which are listed in

your register but not shown on your statement.

ENTER

A. The ending balance

shown on your statement . . . . . • . . . . • . . . . . . . . . . .. $ ______ _

ADD B. Any deposits listed in your

your register or transfers into

your account which are not

shown on your statement.

$_----$_----$_-----

+$_-----

..... . . . . . ... ........ . . .. . .. .... .. ... . :rOTAl $ ______ _

CALCULATE THE SUBTOTAL

(Add Parts A and B)

.. . .. .. .. .. .. ....... .... fOTAl $ ______ _

SUBTRACT

C. The total outstanding checks and

withdrawals from the chart above .

CALCULATE THE ENDING BALANCE

(Part A + Part B - Part C)

This amount should be the same

as the current balance shown in

your check register . . ..... .

-$_----

··· ·L:.=I$ =.I

C2010 Wells Fargo Bank, N.A. All rights reserved. Member FDIC.

Sheet Seq = 0008712 Sheet 00003 of 00003

You must describe the specific information that is inaccurate or in dispute and the basis for any dispute with supporting documentation. In the case of information that relates to an identity theft, you will need to provide us with

an identity theft report.

Number Items Outstanding Amount

Total amount $

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agents retained to perfonn work in connection with this Lease; (b) personal injury, death, or property damage resulting from or arising out of the willful misconduct or negligent acts, errors or omissions of any University Party which occur during or in connection with such University Party's access to the Access Areas and/or the Leased Land in connection with the work to be performed by University in connection with the University Infrastructure Improvements andlor the Delivered Infrastructure; (c) the conduct or activities on the Leased Land or the Access Areas by (i) University, (ii) any of its employees arising while such employee was acting within the scope of employment, or (iii) the University's agents retained to perform work in connection with this Lease; (d) the conduct or activities by any University Party on or about the Leased Land andlor the Access Areas, which arise in connection with the work to be performed by University in connection with the University Infrastructure Improvements and/or the Delivered Infrastructure; (e) any contest by University conducted pursuant to Section 4.6(b) above; (f) University's exercise ofthe rights set forth in Section 4.8(b) above, (g) University's breach of any of the representations and warranties identified in Section S.l(f), Section 21.2 below and/or Section 21.15 below; (h) the presence of any Hazardous Substances on the Leased Land and/or any real property adjacent to the Leased Land which presence arises in connection with a breach of University's obligations under Section 5.1(b) of this Lease, including, without limitation, any Claims for the costs of environmental or technical risk assessment, any cleanup or remedial cost, and the costs of any monitoring, sampling or analysis, and any diminution in property value of Lessee's Interest in the Project; (i) University's use of the Development Documents or Development Agreements for any purpose other than in connection with the operation, maintenance and repair .ofthe Project or any portion thereof; and CD following University's assumption of Lessee's position under any of the Development Agreements, any breach by University of the terms of such Development Agreements; provided, however, University shall have no obligation to indemnify or hold Lessee harmless' from any Claim to the extent such Claim results from or arises out of the willful misconduct or negligent acts, errors or omissions of any Lessee Parties, Lessee, any Sub-Phase Lessee Parties andlor any WVCP Parties. NQtwithstanding the foregoing, except as provided in connection with Lessee's delivery of(l) a Notice oftermination as set forth in Section 17.2, or (II) a Notice of Waiver as set forth in Section 17.4(c), University shall indemnify, 'protect, defend (with counsel reasonably acceptable to University) and hold the Lessee Indemnitees harmless from (x) any Claims resulting from or arising out of any contest conducted by University pursuant to Section 17.4(a), (y) any fines andlor penalties incurred by any Lessee Indemnitee in connection with any action or proceeding described within Section 17.4(b), and (z) the increased costs described within Section 17.4(c).

Section 13.3 Covenant Against Encumbrances. Lessee shall not, and shall have no right to, encumber University's interest in the Leased Land, and Lessee covenants to keep University's interest in the Leased Land and each and every part thereof at all times free and clear of any and all liens and encumbrances of any kind whatsoever arising out of the acts or omissions of the Lessee Parties, including, without limitation, those liens and encumbrances created by the performance by Lessee of any Work, or labor or furnishing of any material, supplies or equipment to Lessee. In addition, Lessee agrees to include in all Commercial Subleases and Student Bed Subleases provisions which require the Occupant thereunder to keep University's interest in the Leased Land free and clear of any and all liens and encumbrances of any kind whatsoever arising out of the acts or omissions of such Occupant and/or its guests or invitees, and Lessee agrees to use commercially reasonable efforts to enforce such contractual

OHS West:260944943.1 -77-

UCD West Village Student Housing Cluster 1 Lease

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Transcript of UCD West Village Student Housing Cluster 1 Lease