THIRD AMENDMENT TO LEASE AGREEMENT

THIRD AMENDMENT TO LEASE AGREEMENT

     THIS THIRD AMENDMENT TO LEASE AGREEMENT (the “Third Amendment”) is made and entered into effective as of June ___, 2006, by and between SPIRIT MASTER FUNDING, LLC, a Delaware limited liability company, as successor-in-interest to Spirit Finance Acquisitions, LLC, a Delaware limited liability company (“Lessor”), and SIGNIFICANT EDUCATION, INC., a Delaware corporation, as successor-in-interest to Significant Education, LLC, a Delaware limited liability company (“Lessee”).

Recitals

     WHEREAS, Lessor and Lessee entered into that certain Lease Agreement dated as of June 28, 2004, as amended pursuant to that certain Amendment to Lease Agreement dated effective as of September 24, 2004, and as further amended pursuant to that certain Second Amendment to Lease Agreement dated effective as of August 23, 2005 (collectively, the “Lease”), with respect to the real property and improvements as described in the Lease. Terms not defined in this Third Amendment shall have the meanings ascribed to them in the Lease.

     WHEREAS, Lessee has requested, and Lessor has agreed to provide, additional funding for additional tenant improvements pursuant to and in accordance with the terms of this Third Amendment.

     NOW, THEREFORE, in consideration of the foregoing recitals and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Lessor and Lessee agree as follows:

1. Additional Tenant Improvements. The following new subsections D and E shall be added to the end of Section 44 of the Lease.

     D. Additional Tenant Improvements. Lessor shall reimburse Lessee an additional aggregate amount not to exceed Five Million Eight Hundred Thousand and 00/100 Dollars ($5,800,000.00) (collectively, the “Additional Funds”) for the construction, completion, rehabilitation, renovation or installation of improvements to the Property related to the operation to the Permitted Facility that are described on Exhibit E attached hereto and incorporated herein (collectively, the “Additional Tenant Improvements ”). Lessor shall disburse the Additional Funds in accordance with, and upon Lessee’s satisfaction of, Lessor’s standard disbursement procedures (including without limitation, the completion, execution and delivery of the Draw Request Certification in the form attached hereto as Exhibit F (the “Draw request”)), in three (3) separate installments as follows: (i) an initial disbursement of $1,044,089.00 shall be made on the date of execution and delivery of this Third Amendment, the Draw Request, and any other documents reasonably requested by Lessor in connection with such initial disbursement; (ii) an interim disbursement not to exceed the amount of $3,071,562.00 shall be made on July 31, 2006 (provided that Lessee has complied in all respects with Lessor’s disbursement procedures); and (iii) a final disbursement not to exceed $1,684,349.00 shall be made upon completion of the Additional Tenant Improvements (provided that Lessee has complied in all respects with Lessor’s disbursement

procedures). Lessor reserves the right to utilize the services of a construction management firm in connection with the Additional Tenant Improvements. Lessor further reserves the right to require Lessee to enter into one or more written agreements to govern the disbursement of any Additional Funds and/or to provide such other documentation reasonably requested by Lessor in connection with the disbursement of any Additional Funds. All reasonable costs and expenses incurred by Lessor with respect to any Additional Tenant Improvement, including, without limitation, attorneys’ fees, construction management fees, inspection costs and title insurance policy endorsement fees, shall be paid by Lessee and all such costs and expenses may be withheld from the Additional Funds in Lessor’s discretion. Lessor and Lessee acknowledge and agree that the Additional Funds will be available to Lessee up to and including December 31, 2006 (“Final Disbursement Date”). To the extent that any Additional Tenant Improvement remains uncompleted as of the Final Disbursement Date, Lessor shall have no obligation to disburse any further Additional Funds to Lessee; provided, however, that the foregoing shall in no way eliminate or diminish Tenant’s obligation to complete such Additional Tenant Improvements in a good and workmanlike manner, or to otherwise perform its obligations under this Lease. All Additional Tenant Improvements shall constitute part of the Property and shall be owned Lessor.

     E. Rent Adjustments. Simultaneously with the disbursement of any Additional Funds, Lessor and Lessee agree to amend the Lease to increase the Base Annual Rental by the amount of such disbursement multiplied by a cap rate of ten and one-half percent (10.5%).

     2. Exhibits E and F. Exhibit E and Exhibit F attached hereto shall be added to the Lease as if fully set forth therein.

     3. Definitions. The following definitions shall be added to Exhibit A of the Lease:

     “Additional Funds” has the meaning set forth in Section 44.D.

     “Additional Tenant Improvements” has the meaning set forth in Section 44.D.

     “Base Annual Rent” shall mean $3,574,629.35.

     “Final Disbursement Date” has the meaning set forth in Section 44.D.

     4. Lessor’s Total Investment. The definition of “Lessor’s Total Investment” in Exhibit A of the Lease shall be deleted in its entirely, and the following new definition shall be inserted in lieu thereof:

     “Lessor’s Total Investment” means, with respect to any Property, the sum of (a) the gross purchase price paid for the Property by Lessor (or Lessor’s predecessor-in-interest) (including, without limitation, any mortgage debt incurred or assumed in connection therewith and any Contingent Purchase Price paid by Lessor), plus (b) all amounts disbursed and all costs and expenses incurred by Lessor pursuant to Section 44 of this Lease, plus (c) the closing costs and expenses incurred by Lessor (or Lessor’s predecessor-in-interest) with respect to the purchase of the Property.

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     5. Ratification. Except as expressly stated herein, the Lease shall remain in full force and effect. If there is any conflict between the Lease and the terms of this Third Amendment, the terms of this Third Amendment shall control.

[Remainder of page intentionally left blank; signature page(s) to follow]

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     Lessor and Lessee have executed this Third Amendment as of the dated set forth above.

	LESSOR: SPIRIT MASTER FUNDING, LLC
	By:	/s/ Xxxxx X. Xxxxxxx
		Printed Name:	Xxxxx X. Xxxxxxx
		Title:	Senior Vice President
	LESSEE: SIGNIFICANT EDUCATION, INC.
	By:	/s/ Xxxxxxx X. Xxxxxxx
		Printed Name:	Xxxxxxx X. Xxxxxxx
		Title:	Chief Financial Officer

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EXHIBIT E

ADDITIONAL TENANT IMPROVEMENTS

Project description

Project Cost

Reason for Project

Justification

Installation of Promenade to student union

$

850,000

Reduce liability, cosmetic change to draw students

Demonstrate to current and future students that GCU is on its way to becoming a destination campus

New Swimming Pool

$

1,700,000

Cosmetic & Revenue Generator

A modern pool will attract significant camps over the summer, corporate outings and other revenue generating activities. We estimate on the low side we can generate $20,000 for 14 weeks of summer and $4,000 per week during the rest of the year

Kaibab Remodeling

$

2,200,000

Office Space for Online

Currently paying $200K annual lease at 00xx Xxxxxx. Amount likely to double over the next two years. Market value of comparable space 20,000 SF @ $25 = $500,000

Bright Angel Remodeling

$

850,000

Classroom Space for Nursing and Office Space

Add up to 12 classrooms/labs on the campus. Every lab built allows admission of 25 more nurses per start. Assuming we build two labs, 300 additional nurses per year at $3,150 in revenue per year. Also, have additional class space for future expansion.

New Student Snack & Activity Center

$

200,000

Cosmetic & Revenue Generator

Build a coffee house hang out on the promenade in the middle of the campus offer, wireless internet, coffee, food, etc.

Total Cost

$

5,80,000

Attached hereto is a true and correct copy of the Anticipated Draw Schedule

Spirit Finance
Remodel Projects — 2006 Project Timeline Exhibit B— Third Amendment to Lease Agreement
8/13/2006 1:38PM

						6/30/06												Draw Forecasts
										Invoices																																				Remaining
		Project				Payments				Accrued &				Spirit Draw for																												Total Project				Spirit				% of Funds
Project		Cost				to Date				Unpaid				June				7/31/06				8/31/06				9/30/06				10/31/06				11/30/06				12/31/06				Costs				Funds				Remaining
Promenade to Student Union			850,000				210,209.99				58,018.95				268,228.94				581,771																								850,000				0				0.00	%
New Swimming Pool			1,700,000				15,650.97								15,650.97								850,000								300,000				300,000				234,349				1,700.00				0				0.00	%
Kaibab Remodeling			2,200,000				677,251.19				82,958.33				760,209.52				300,000				1,139,790																				2,200,000				0				0.00	%
Bright Angel Remodeling			850,000												0												300,000				200,000				200,000				150,000				850,000				0				0.00	%
New Student Snack & Activity Center			200,000												0								200,000																				200,000				0				0.00	%
Total Spirit Remodel Projects			5,800,000				903,112.15				140,977.28				1,044,089.43				881,771				2,189,790				300,000				500,000				500,000				384,349				5,800,000				0				0.00	%
										Draws =				$	1,044,089			$	3,071,562											Upon completion								$	1,684,349			$	5,800,000

EXHIBIT F
DRAW REQUEST CERTIFICATION

DRAW REQUEST NUMBER 8

DATE:		June 9, 2006
LESSOR:		Spirit Master Funding, LLC
LESSEE:		Significant Education, Inc.
PROJECT:		Additional Tenant Improvements / Grand Canyon University 3300 West Camelback Road, Phoenix, Arizona

     Reference is made to that certain Lease Agreement dated as of June 28, 2004 between Lessor and Lessee, as amended pursuant to that certain Amendment to Lease Agreement dated effective as of September 24, 2004, as further amended pursuant to that certain Second Amendment to Lease Agreement dated effective as of August 23, 2005, and as further amended pursuant to that certain Third Amendment to Lease Agreement dated effective as of June ___, “Lease”). Capitalized terms used herein without definition shall have the meanings set forth in the Lease, unless the context shall require otherwise.

     Lessee requests that Lessor disburse proceeds from the Additional Funds in the amounts and for the Additional Tenant Improvements stated in the attached Schedule 1 (the “Draw Request”).

     1. In connection with such requested disbursement, Lessee hereby represents, warrants and certifies to Lessor as of the date hereof as follows:

     (a) No Event of Default presently exists under the Lease.

     (b) All of representations and warranties of Lessee under the Lease are hereby remade and restated and are true and correct in all material respects.

     (c) With respect to the requested Additional Funds:

     (i) Lessee has satisfied all conditions precedent to the disbursement of the Additional Funds as set forth in the Lease:

     (ii) the Lease is in full force and effect;

Draw Request Certification
Grand Canyon University — Additional Tenant Improvements

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     (iii) the sum of all amounts expended for the Additional Tenant Improvements identified on the Draw Request does not exceed the total amount budgeted for such Additional Tenant Improvements; and

     (iv) all contractors, subcontractors, vendors, materialmen and other Persons entitled to payment with respect to the Additional Tenant Improvements for which the Additional Funds are being requested have been paid or will be paid with the proceeds of the requested the Additional Funds.

     (d) All insurance required to be maintained by Lessee remains in full force and effect, and each is of the type and in the amount, and issued by insurers, as previously approved by Lessor.

     (e) With respect to any Additional Tenant Improvement for which the Additional Funds are being requested in the Draw Request:

     (i) All such Additional Tenant Improvements have been made in a good and workmanlike manner and in compliance with all applicable permits, authorizations and Legal Requirements;

     (ii) No Additional Tenant Improvement impairs the safety or structural integrity of the applicable building or structure upon which it is located; and

     (iii) Attached to the Draw Request are supporting invoices of each such contractor, subcontractor, vendor, materialman or other person with respect to the work and/or materials as to which a disbursement of the Additional Funds is being requested.

     2. Lessee will certify, or cause any general contractor to certify, to Lessor, upon request of Lessor at any time, and from time to time, as to all materialmen, laborers, subcontractors, suppliers, and any other parties who might or could claim statutory or common law liens as a result of furnishing material or labor to the Property or any portion thereof or interest therein (the “Contracting Parties”), together with evidence satisfactory to Lessor, that such Contracting Parties have been paid or will be paid from the disbursement of the Additional Funds being requested hereunder.

     3. Lessee shall obtain lien waivers from any and all such Contracting Parties after such Contracting Parties have been paid all amounts then due for labor and/or materials and provide such lien waivers to Lessor within ten (10) business days after Lessor disburses the proceeds of the Draw Request to Lessee.

     4. If, during the construction or installation of the Additional Tenant Improvements, a lien is filed against the Property for work performed or goods and/or services provided to the Property, Lessee shall provide Lessor with notice of the filing of such lien promptly after Lessee obtains knowledge of such filing. Lessee shall then have twenty (20) days after delivery of such notice to Lessor to cause such lien to be released or bonded off pursuant to Arizona statute from

Draw Request Certification
Grand Canyon University — Additional Tenant Improvements

2

the applicable real property records or to post a bond or to provide an indemnity satisfactory to First American Title Insurance Company (the “Title Company”) which would enable the Title Company to issue an endorsement to Lessor’s title policy issued for the Property which would insure over such lien. If Lessee fails to cause such lien to be released or to post such a bond or deliver such an indemnity, such failure shall be deemed an Event of Default under the Lease and shall entitle Lessor to exercise its remedies contained therein.

     5. Lessee agrees to indemnify, hold harmless and defend Lessor and its respective officers, managers, members, employees, successors, assigns, agents, lenders, contractors, subcontractors, experts, licensees, affiliates, mortgagees, trustees and invitees, as applicable, from and against any and all claims, demands, causes of action, suits, proceedings, losses, costs, liabilities, damages (including consequential and punitive) and expense, including, without limitation, attorneys’ fees caused by, incurred or resulting from the breach of any of the representations, warranties, covenants, agreements or obligations of Lessee set forth in this Draw Request, or Lessee’s operations of or relating in any manner to Property.

	LESSEE: SIGNIFICANT EDUCATION, INC., a Delaware corporation
	By:	/s/ Xxxxxxx X. Xxxxxxx
		Printed Name:	Xxxxxxx X. Xxxxxxx
		Title:	Chief Financial Officer

Draw Request Certification
Grand Canyon University-Addition Tenant Improvements

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SCHEDULE 1 TO DRAW REQUEST NUMBER 8

Check

Check

Project Sub-

Date

#

Date

Description

Amount

Project

Total

Project Payments

01/27/06

239845

01/30/06

Moline Construction

41,520.00

Kaibab

02/08/06

241532

03/03/06

Xxxxxxxx Designs, Inc.

625.00

Kaibab

02/14/06

241526

03/03/06

Xxxxxxx Xxxxxxxx

1,134.00

Kaibab

02/14/06

241675

03/08/06

Moline Construction

266,850.00

Kaibab

02/28/06

241444

03/03/06

American Express

453.67

Kaibab

(Hajoca Phoenix)

03/31/06

245774

04/18/06

Moline Construction

89,902.00

Kaibab

04/29/06

246221

05/02/06

Moline Construction

72,065.00

Kaibab

04/26/06

246146

04/28/06

Xxxxxxx Xxxxxxxx

1,990.00

Kaibab

05/11/06

10326

05/11/06

Salt River Project

10,652.00

Kaibab

04/18/06

12260

05/22/06

Valley Systems

17,128.52

Kaibab

04/26/06

12465

05/26/06

Xxxxxxxx Designs, Inc.

1,350.00

Kaibab

05/25/06

12325

05/22/06

SRP

73,581.00

Kaibab

677,251.19

06/02/06

12964

6/2/2006

Moline Construction

100,000.00

Kaibab Pool

15,650.97

01/31/06

241098

02/24/06

Xxxxxxx Quality

15,650.97

Demolition

Demolition

03/09/06

241813

03/10/06

Salt River Project

39,180.00

Promenade

02/22/06

242519

03/17/06

Desert Services

787.50

Promenade

05/02/06

243233

05/02/06

Salt River Project

2,400.00

Promenade

04/26/06

12266

05/22/06

Wescor General, Inc.

13,293.53

Promenade

05/19/06

12266

05/22/06

Wescor General, Inc.

75,000.00

Promenade

05/31/06

12839

05/31/06

Wescor General, Inc.

74,057.96

Promenade

05/17/06

12956

6/2/2006

Liberty Pipeline

5,491.00

Promenade

210,209.99

Total Project Payments to Date

903,112.15

903,112.15

Invoices Received & Not Yet Paid

06/06/06

Xxxxxxx Xxxxxxxx

2,000.00

Kaibab

05/17/06

Xxxxxxxx Designs, Inc.

625.00

Kaibab

05/26/06

Xxxxxx Engineers

293.84

Kaibab

05/31/06

American Express

9,656.00

Kaibab

06/05/06

Moline Construction

70,383.49

Kaibab

82,958.33

05/12/06

Liberty Pipeline Services, LLC

1,612.09

Promenade

05/18/06

Xxxxxx Engineers

576.00

Promenade

05/26/06

Wescor General, Inc.

55,830.86

Promenade

258,018.95

Total Invoices Received & Not Yet Paid

140,977.28

140,977.28

Total Draw Request #8

$

1,044,089.43

$

1,044,089.43