Exhibit 10(b)(12)(b)

EXECUTION COPY

 

 

 

COMMERCIAL LOAN SALE AGREEMENT

by and between

NEWSTAR FINANCIAL, INC.,

as the Originator

and

NEWSTAR COMMERCIAL LOAN LLC 2009-1,

as the Trust Depositor

Dated as of January 7, 2010

 

 

 

NewStar Commercial Loan Trust 2009-1

Class A, Class B, Class C and Subordinated Notes

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TABLE OF CONTENTS

 

          Page

ARTICLE I DEFINITIONS

   2

Section 1.01

  

Definitions

   2

Section 1.02

  

Other Terms

   4

Section 1.03

  

Computation of Time Periods

   4

Section 1.04

  

Interpretation

   4

Section 1.05

  

References

   5

Section 1.06

  

Calculations

   5

ARTICLE II TRANSFER OF LOAN ASSETS

   5

Section 2.01

  

Transfer of Loan Assets

   5

Section 2.02

  

Conditions to Transfer of Loan Assets to the Trust Depositor

   7

Section 2.03

  

Acceptance by the Trust Depositor

   8

Section 2.04

  

Conveyance of Substitute Loans

   8

Section 2.05

  

Conveyance of Additional Loans

   11

Section 2.06

  

Release of Excluded Amounts

   12

Section 2.07

  

Delivery of Documents in the Loan File; Recording of Assignments of Mortgage

   12

ARTICLE III REPRESENTATIONS AND WARRANTIES

   13

Section 3.01

  

Representations and Warranties Regarding the Originator

   14

Section 3.02

  

Representations and Warranties Regarding Each Loan and as to Certain Loans in
the Aggregate

   18

Section 3.03

  

[Reserved]

   18

Section 3.04

  

Representations and Warranties Regarding the Required Loan Documents

   18

Section 3.05

  

[Reserved]

   18

Section 3.06

  

Representations and Warranties Regarding the Trust Depositor

   18

ARTICLE IV PERFECTION OF TRANSFER AND PROTECTION OF SECURITY INTERESTS

   20

Section 4.01

  

Custody of Loans

   20

Section 4.02

  

Filing

   21

Section 4.03

  

Changes in Name, Corporate Structure or Location

   21

Section 4.04

  

Costs and Expenses

   21

 

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TABLE OF CONTENTS

(continued)

 

          Page

Section 4.05

  

Sale Treatment

   21

Section 4.06

  

Separateness from Trust Depositor

   21

ARTICLE V COVENANTS OF THE ORIGINATOR

   22

Section 5.01

  

Corporate Existence

   22

Section 5.02

  

Loans Not to Be Evidenced by Promissory Notes

   22

Section 5.03

  

Security Interests

   22

Section 5.04

  

Compliance with Law

   22

Section 5.05

  

Liability of Originator

   22

Section 5.06

  

Limitation on Liability of Originator and Others

   23

Section 5.07

  

Reserved

   23

Section 5.08

  

Merger or Consolidation of Originator

   23

Section 5.09

  

Delivery of Collections

   23

Section 5.10

  

Underlying Custodial Agreements

   23

Section 5.11

  

Payments from Concentration Account

   24

ARTICLE VI REMEDIES UPON MISREPRESENTATION; REPURCHASE OPTION

   24

Section 6.01

  

Repurchases of, or Substitution for, Loans for Breach of Representations and
Warranties

   24

Section 6.02

  

Reassignment of Repurchased or Substituted Loans

   25

ARTICLE VII INDEMNIFICATION BY THE ORIGINATOR

   25

Section 7.01

  

Indemnification

   25

Section 7.02

  

Liabilities to Obligors

   25

Section 7.03

  

Operation of Indemnities

   26

ARTICLE VIII MISCELLANEOUS

   26

Section 8.01

  

Amendment

   26

Section 8.02

  

Governing Law

   27

Section 8.03

  

Notices

   28

Section 8.04

  

Severability of Provisions

   30

Section 8.05

  

Third Party Beneficiaries

   30

Section 8.06

  

Counterparts

   30

Section 8.07

  

Headings

   30

 

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TABLE OF CONTENTS

(continued)

 

          Page

Section 8.08

  

No Bankruptcy Petition; Disclaimer

   31

Section 8.09

  

Jurisdiction

   31

Section 8.10

  

Prohibited Transactions with Respect to the Issuer

   31

Section 8.11

  

No Partnership

   31

Section 8.12

  

Successors and Assigns

   31

Section 8.13

  

Duration of Agreement

   31

Section 8.14

  

Limited Recourse

   32

Exhibit A

  

Form of Assignment

   A

 

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COMMERCIAL LOAN SALE AGREEMENT

THIS COMMERCIAL LOAN SALE AGREEMENT, dated as of January 7, 2010 (as amended,
modified, restated, waived, or supplemented from time to time, this
“Agreement”), is between NEWSTAR FINANCIAL, INC., a Delaware corporation
(together with its successors and assigns, “NewStar,” and in its capacity as
originator, together with its successors and assigns, the “Originator”) and
NEWSTAR COMMERCIAL LOAN LLC 2009-1, a Delaware limited liability company
(together with its successors and assigns, the “Trust Depositor”).

WHEREAS, in the regular course of its business, the Originator originates and/or
otherwise acquires Loans;

WHEREAS, the Trust Depositor desires to acquire the Initial Loans from the
Originator and may acquire from time to time thereafter certain Additional Loans
and Substitute Loans;

WHEREAS, it is a condition to the Trust Depositor’s acquisition of the Initial
Loans, any Additional Loans and any Substitute Loans from the Originator that
the Originator make certain representations and warranties regarding the Loan
Assets for the benefit of the Trust Depositor as well as the Issuer;

WHEREAS, on the Closing Date, the Trust Depositor will purchase and accept
assignment of the Initial Loan Assets and certain other assets from the
Originator as provided herein; and

WHEREAS, on the Closing Date, the Trust Depositor will sell, convey and assign
all its right, title and interest in the Initial Loan Assets to NewStar
Commercial Loan Trust 2009-1, a Delaware statutory trust (the “Issuer”),
pursuant to a Sale and Servicing Agreement, dated as of the date hereof (as
amended, modified, restated, replaced, waived, substituted, supplemented or
extended from time to time, the “Sale and Servicing Agreement”), among NewStar,
as the originator and the servicer, the Trust Depositor, as the trust depositor,
the Issuer, as the issuer, U.S. Bank National Association, as the trustee and
Wilmington Trust Company, as the owner trustee.

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NOW, THEREFORE, based upon the above recitals, the mutual promises and
agreements contained herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto,
intending to be legally bound, hereby agree as follows:

ARTICLE I

DEFINITIONS

Section 1.01 Definitions.

Capitalized terms used but not defined in this Agreement shall have the meanings
attributed to such terms in the Sale and Servicing Agreement, unless the context
otherwise requires. In addition, as used herein, the following defined terms,
unless the context otherwise requires, shall have the following meanings:

“Additional Loan Assets” means any assets acquired by the Trust Depositor from
the Originator during the Ramp-Up Period pursuant to Section 2.05(a), which
assets shall include the Originator’s right, title and interest in the
following:

(i) the Additional Loans listed in the related Subsequent List of Loans, all
payments paid in respect thereof and all monies due, to become due or paid in
respect thereof accruing on and after the applicable Cut-Off Date and all
Insurance Proceeds, Liquidation Proceeds, Released Mortgaged Property Proceeds
and other recoveries thereon, in each case as they arise after the applicable
Cut-Off Date;

(ii) all security interests and Liens and Related Property subject thereto from
time to time purporting to secure payment by Obligors under such Loans;

(iii) all guaranties, indemnities and warranties, and other agreements or
arrangements of whatever character from time to time supporting or securing
payment of such Loans;

(iv) all collections and records (including Computer Records) with respect to
the foregoing;

(v) all documents relating to the applicable Loan Files; and

(vi) all income, payments, proceeds and other benefits of any and all of the
foregoing, including but not limited to, all accounts, cash and currency,
chattel paper, electronic chattel paper, tangible chattel paper, copyrights,
copyright licenses, equipment, fixtures, general intangibles, instruments,
commercial tort claims, deposit accounts, inventory, investment property, letter
of credit rights, software, supporting obligations, accessions, and other
property consisting of, arising out of, or related to the foregoing, but
excluding any Excluded Amount with respect thereto.

“Indemnified Party” shall have the meaning provided in Section 7.01.

“Ineligible Loan” shall have the meaning provided in Section 6.01.

“Initial Loan Assets” means any assets acquired by the Trust Depositor from the
Originator on the Closing Date pursuant to Section 2.01, which assets shall
include the Originator’s right, title and interest in the following:

(i) the Initial Loans listed in the initial List of Loans, all payments paid in
respect thereof and all monies due, to become due or paid in respect thereof
accruing on and after the Closing Date and all Insurance Proceeds, Liquidation
Proceeds, Released Mortgaged Property Proceeds and other recoveries thereon, in
each case as they arise after the Closing Date;

 

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(ii) all security interests and Liens and Related Property subject thereto from
time to time purporting to secure payment by Obligors under such Loans;

(iii) all guaranties, indemnities and warranties, and other agreements or
arrangements of whatever character from time to time supporting or securing
payment of such Loans;

(iv) the Transaction Accounts and the Concentration Accounts, together with all
cash and investments in each of the foregoing but only to the extent, in respect
of the Concentration Accounts, relating to the Loans;

(v) all collections and records (including Computer Records) with respect to the
foregoing;

(vi) all documents relating to the applicable Loan Files; and

(vii) all income, payments, proceeds and other benefits of any and all of the
foregoing, including but not limited to, all accounts, cash and currency,
chattel paper, electronic chattel paper, tangible chattel paper, copyrights,
copyright licenses, equipment, fixtures, general intangibles, instruments,
commercial tort claims, deposit accounts, inventory, investment property, letter
of credit rights, software, supporting obligations, accessions, and other
property consisting of, arising out of, or related to the foregoing, but
excluding any Excluded Amount with respect thereto.

“Loan Assets” means, collectively and as applicable, the Initial Loan Assets,
the Substitute Loan Assets and the Additional Loan Assets, as applicable.

“Notice of Substitution” shall have the meaning provided in Section 2.04(a)(ii).

“Substitute Loan Assets” means any assets acquired by the Trust Depositor in
connection with a substitution of one or more Substitute Loans pursuant to
Section 2.04, which assets shall include the Originator’s right, title and
interest in the following:

(i) the Substitute Loans listed in the related Subsequent List of Loans, all
payments paid in respect thereof and all monies due, to become due or paid in
respect thereof accruing on and after the applicable Cut-Off Date and all
Insurance Proceeds, Liquidation Proceeds, Released Mortgaged Property Proceeds
and other recoveries thereon, in each case as they arise after the applicable
Cut-Off Date;

(ii) all security interests and Liens and Related Property subject thereto from
time to time purporting to secure payment by Obligors under such Loans;

(iii) all guaranties, indemnities and warranties, and other agreements or
arrangements of whatever character from time to time supporting or securing
payment of such Loans;

(iv) all collections and records (including Computer Records) with respect to
the foregoing;

 

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(v) all documents relating to the applicable Loan Files; and

(vi) all income, payments, proceeds and other benefits of any and all of the
foregoing, including but not limited to, all accounts, cash and currency,
chattel paper, electronic chattel paper, tangible chattel paper, copyrights,
copyright licenses, equipment, fixtures, general intangibles, instruments,
commercial tort claims, deposit accounts, inventory, investment property, letter
of credit rights, software, supporting obligations, accessions, and other
property consisting of, arising out of, or related to the foregoing, but
excluding any Excluded Amount with respect thereto.

“Substitution Period” shall have the meaning provided in Section 2.04(a)(ii)(3).

Section 1.02 Other Terms.

All accounting terms used but not specifically defined herein shall be construed
in accordance with generally accepted accounting principles in the United
States. The symbol “$” shall mean the lawful currency of the United States of
America. All terms used in Article 9 of the UCC in the State of New York, and
not specifically defined herein, are used herein as defined in such Article 9.

Section 1.03 Computation of Time Periods.

Unless otherwise stated in this Agreement, in the computation of a period of
time from a specified date to a later specified date, the word “from” means
“from and including,” the words “to” and “until” each mean “to but excluding,”
and the word “within” means “from and excluding a specified date and to and
including a later specified date.”

Section 1.04 Interpretation.

In this Agreement, unless a contrary intention appears:

(i) the singular number includes the plural number and vice versa;

(ii) reference to any Person includes such Person’s successors and assigns but,
if applicable, only if such successors and assigns are permitted by the
Transaction Documents;

(iii) reference to any gender includes each other gender;

(iv) reference to day or days without further qualification means calendar days;

(v) unless otherwise stated, reference to any time means New York, New York
time;

(vi) references to “writing” include printing, typing, lithography, electronic
or other means of reproducing words in a visible form;

 

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(vii) reference to any agreement (including any Transaction Document), document
or instrument means such agreement, document or instrument as amended, modified,
supplemented, replaced, restated, waived or extended and in effect from time to
time in accordance with the terms thereof and, if applicable, the terms of the
other Transaction Documents, and reference to any promissory note includes any
promissory note that is an extension or renewal thereof or a substitute or
replacement therefor; and

(viii) reference to any Applicable Law means such Applicable Law as amended,
modified, codified, replaced or reenacted, in whole or in part, and in effect
from time to time, including rules and regulations promulgated thereunder and
reference to any Section or other provision of any Applicable Law means that
provision of such Applicable Law from time to time in effect and constituting
the substantive amendment, modification, codification, replacement or
reenactment of such Section or other provision.

Section 1.05 References.

All section references (including references to the Preamble), unless otherwise
indicated, shall be to Sections (and the Preamble) in this Agreement.

Section 1.06 Calculations.

Except as otherwise provided herein, all interest rate and basis point
calculations hereunder will be made on the basis of a 360 day year and the
actual days elapsed in the relevant period and will be carried out to at least
three decimal places.

ARTICLE II

TRANSFER OF LOAN ASSETS

Section 2.01 Transfer of Loan Assets.

(a) The Originator shall sell, assign and convey Loan Assets to the Trust
Depositor pursuant to the terms and provisions hereof.

(b) Subject to and upon the terms and conditions set forth herein, the
Originator hereby sells, transfers, assigns, sets over and otherwise conveys to
the Trust Depositor, for a purchase price consisting of $187,078,701 in cash,
all the right, title and interest of the Originator in and to the Initial Loan
Assets.

To the extent the purchase price paid to the Originator for any Loan Assets is
less than the fair market value of such Loan Assets, the difference between such
fair market value and such purchase price shall be deemed to be a capital
contribution made by the Originator to the Trust Depositor on the Closing Date
in the case of the Initial Loans and as of the related Cut-Off Date in the case
of any Additional Loans or Substitute Loans. For all purposes of this Agreement,
any contributed Loan Assets shall be treated the same as Loan Assets sold for
cash, including without limitation for purposes of Section 6.01.

 

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(c) The Originator and the Trust Depositor each acknowledge with respect to
itself that the representations and warranties of the Originator in Sections
3.01 through 3.04 hereof and of the Trust Depositor in the Sale and Servicing
Agreement and in Section 3.06 hereof will run to and be for the benefit of the
Issuer and the Trustees, and the Issuer and the Trustees may enforce directly
(without joinder of the Trust Depositor when enforcing against the Originator)
the repurchase obligations of the Originator or the Trust Depositor, as
applicable, with respect to breaches of such representations and warranties as
set forth in the Sale and Servicing Agreement or in this Agreement.

(d) The sale, transfer, assignment, set-over and conveyance of the Loan Assets
by the Originator to the Trust Depositor pursuant to this Agreement does not
constitute and is not intended to result in a creation or an assumption by the
Trust Depositor or the Issuer of any obligation of the Originator as lead agent,
collateral agent or paying agent under any Agented Loan.

(e) The Originator and the Trust Depositor intend and agree that (i) the
transfer of the Loan Assets by the Originator to the Trust Depositor hereunder
and the transfer of the Loan Assets by the Trust Depositor to the Issuer under
the Sale and Servicing Agreement are intended to be a sale, conveyance and
transfer of ownership of the applicable Loan Assets, as the case may be, rather
than the mere granting of a security interest to secure a borrowing and
(ii) such Loan Assets shall not be part of the Originator’s or the Trust
Depositor’s estate in the event of a filing of a bankruptcy petition or other
action by or against such Person under any Insolvency Law. In the event,
however, that notwithstanding such intent and agreement, such transfers are
deemed to be a mere granting of a security interest to secure indebtedness, the
Originator shall be deemed to have granted (and as of the Closing Date hereby
grants) to the Trust Depositor and the Trust Depositor shall be deemed to have
granted (and as of the Closing Date hereby grants) to the Issuer, as the case
may be, a perfected first priority security interest in all right, title and
interest of the Originator or of the Trust Depositor, respectively, in such Loan
Assets, and this Agreement shall constitute a security agreement under
Applicable Law, securing the repayment of the purchase price paid hereunder, the
obligations and/or interests represented by the Securities, in the order and
priorities, and subject to the other terms and conditions of, this Agreement,
the Sale and Servicing Agreement, the Indenture and the Trust Agreement,
together with such other obligations or interests as may arise hereunder and
thereunder in favor of the parties hereto and thereto.

(f) If any such transfer of the Loan Assets is deemed to be the mere granting of
a security interest to secure a borrowing, the Trust Depositor may, to secure
the Trust Depositor’s own borrowing under the Sale and Servicing Agreement (to
the extent that the transfer of the Loan Assets thereunder is deemed to be a
mere granting of a security interest to secure a borrowing), repledge and
reassign (i) all or a portion of the Loan Assets pledged to the Trust Depositor
by the Originator and with respect to which the Trust Depositor has not released
its security interest at the time of such pledge and assignment, and (ii) all
proceeds thereof. Such repledge and reassignment may be made by the Trust
Depositor with or without a repledge and reassignment by the Trust Depositor of
its rights under any agreement with the Originator, and without further notice
to or acknowledgment from the Originator. The Originator waives, to the extent
permitted by Applicable Law, all claims, causes of action and remedies, whether
legal or equitable (including any right of setoff), against the Trust Depositor
or any assignee of the Trust Depositor relating to such action by the Trust
Depositor in connection with the transactions contemplated by this Agreement and
the other Transaction Documents.

 

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(g) The Originator and the Trust Depositor acknowledge and agree that, solely
for administrative convenience, any assignment agreement required to be executed
and delivered in connection with the transfer of a Loan in accordance with the
terms of related Underlying Loan Agreements may reflect that the Originator or
any Affiliate thereof is assigning such Loan directly to the Issuer. Nothing in
such assignment agreements shall be deemed to impair the transfers of the Loan
Assets by the Originator to the Trust Depositor in accordance with the terms of
this Agreement and the subsequent transfer of the Loan Assets by the Trust
Depositor to the Issuer in accordance with the terms of the Sale and Servicing
Agreement.

Section 2.02 Conditions to Transfer of Loan Assets to the Trust Depositor.

On or before the Closing Date, the Originator shall deliver or cause to be
delivered to the Trust Depositor, the Owner Trustee and the Trustee each of the
documents, certificates and other items as follows:

(a) a certificate of an officer of the Originator substantially in the form of
Exhibit C to the Sale and Servicing Agreement;

(b) copies of resolutions of the Board of Directors of the Originator and the
Servicer or of the Executive Committee of the Board of Directors of the
Originator and the Servicer approving the execution, delivery and performance of
this Agreement, the Transaction Documents to which it is a party and the
transactions contemplated hereunder and thereunder, certified in each case by
the Secretary or an Assistant Secretary of the Originator and the Servicer;

(c) officially certified evidence dated within 30 days of the Closing Date of
due formation and good standing of the Originator under the laws of the State of
Delaware;

(d) the initial List of Loans, certified by an officer of the Originator,
together with an Assignment with respect to the Initial Loan Assets
substantially in the form of Exhibit A (along with the delivery of any
instruments and Loan Files as required under Section 2.07);

(e) a letter from KPMG or another nationally recognized accounting firm,
addressed to the Originator and the Trust Depositor (with a copy to the Trustee
and Moody’s), stating that such firm has reviewed a sample of the Initial Loans
and performed specific procedures for such sample with respect to certain loan
terms and that identifies those Initial Loans that do not conform;

(f) evidence of proper filing with appropriate offices in the State of Delaware
of UCC financing statements listing the Originator as debtor, naming the Trustee
as total assignee and identifying the Loan Assets as collateral;

(g) an Officer’s Certificate listing the Servicer’s Servicing Officers; and

(h) a fully executed copy of each of the Transaction Documents.

 

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Section 2.03 Acceptance by the Trust Depositor.

Within three Business Days after the Closing Date, if the conditions set forth
in Section 2.02 have been satisfied, the Originator shall deliver, on behalf of
the Trust Depositor, to the Trustee the Initial Loan Assets and such delivery to
and acceptance by the Trustee shall be deemed to be delivery to and acceptance
by the Trust Depositor.

Section 2.04 Conveyance of Substitute Loans.

(a) (i) With respect to any Loan as to which a Substitution Event has occurred,
subject to Sections 2.01(d) and (e) and, as applicable, the satisfaction of the
conditions set forth in Section 2.04(d), the Originator may, at its option (but
shall not be obligated to) either:

(1) contemporaneously convey to the Trust Depositor one or more Loans as
described in Section 2.04(c) in exchange for such Loan; or

(2) deposit into the Principal Collection Account the Transfer Deposit Amount
with respect to such Loan and then, prior to the expiry of the Substitution
Period, convey to the Trust Depositor one or more Loans as described in
Section 2.04(c) in exchange for the funds or portion thereof so deposited.

(ii) Any substitution pursuant to this Section 2.04 shall be initiated by
delivery of written notice (a “Notice of Substitution”) to the Trustee from the
Servicer that the Originator intends to substitute a Loan pursuant to this
Section 2.04 and shall be completed prior to the earlier of:

(1) the expiration of 90 days after delivery of such notice;

(2) delivery of written notice to the Trustee from the Originator stating that
it does not intend to convey any additional Substitute Loans to the Trust
Depositor in exchange for any remaining amounts deposited in the Principal
Collection Account under clause (a)(i)(2); or

(3) in the case of a Loan which has become subject to a Material Modification,
the effective date set forth in such Material Modification (such period
described in clause (ii)(1), (2) or (3), as applicable, being the “Substitution
Period”).

(iii) Each Notice of Substitution shall specify the Loan to be substituted, the
reasons for such substitution and the Transfer Deposit Amount with respect to
the Loan. On the last day of any Substitution Period, any amounts previously
deposited in accordance with clause (a)(i)(2) above which relate to such
Substitution Period that have not been applied to purchase one or more
Substitute Loans or to fund the Exposure Reserve Account if necessary with
respect thereto shall be deemed to constitute Principal Collections and shall be
transferred on the next Distribution Date to the Note Distribution Account and
distributed in accordance with the Priority of Payments, as applicable; provided
that prior to the expiration of the related Substitution Period

 

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any such amounts shall not be deemed to be Principal Collections and shall
remain in the Principal Collection Account until applied to acquire Substitute
Loans or to fund the Exposure Reserve Account if necessary with respect thereto.
The price paid (or, in the case of a contemporaneous conveyance of a Substitute
Loan pursuant to Section 2.04(a)(i)(1), deemed paid) by the Trust Depositor for
any Substitute Loan shall be an amount equal to (x) in the case of a Loan
originated by the Originator, the outstanding principal amount thereof and
(y) in the case of a Loan acquired by the Originator from an unaffiliated third
party, the purchase price (expressed as a percentage of par) paid for such Loan
by the Originator multiplied by the outstanding principal amount thereof, plus
in each case accrued interest thereon.

(b) With respect to any Substitute Loans to be conveyed to the Trust Depositor
by the Originator as described in Section 2.04(a), the Originator hereby sells,
transfers, assigns, sets over and otherwise conveys to the Trust Depositor,
without recourse other than as expressly provided herein (and the Trust
Depositor shall purchase through cash payment and/or by exchange of one or more
related Loans released by the Issuer to the Trust Depositor on the related
Cut-Off Date), all the right, title and interest of the Originator in and to the
Substitute Loan Assets.

To the extent the purchase price paid to the Originator for any Substitute Loan
is less than the fair market value of such Substitute Loan, the difference
between such fair market value and the purchase price shall be deemed to be a
capital contribution made by the Originator to the Trust Depositor on the
relevant Cut-Off Date.

(c) Subject to Sections 2.01(d) and (e), and the conditions set forth in
Section 2.04(d), the Originator shall sell, transfer, assign, set over and
otherwise convey to the Trust Depositor, without recourse other than as
expressly provided herein and therein, (i) all the right, title and interest of
the Originator in and to the Substitute Loans sold pursuant to Sections 2.04(a)
and (b), and (ii) all other rights and property interests consisting of
Substitute Loan Assets related to such Substitute Loans (the property in clauses
(i) and (ii) above, upon such transfer, becoming part of the Collateral).

(d) The Originator shall transfer to the Trust Depositor hereunder and the Trust
Depositor shall transfer to the Issuer under the Sale and Servicing Agreement
the applicable Substitute Loans Assets and the other property and rights related
thereto described in Section 2.04(c) only upon the satisfaction of each of the
following conditions on or prior to the related Cut-Off Date (and the delivery
of a related Addition Notice by the Trust Depositor shall be deemed a
representation and warranty by the Trust Depositor and the Originator that such
conditions are satisfied as of the related Cut-Off Date):

(i) the Trust Depositor shall have provided the Issuer and the Trustee with a
timely Addition Notice complying with the definition thereof, which Addition
Notice shall be delivered no later than 11:00 a.m. on the related Cut-Off Date;

(ii) there shall have occurred, with respect to each such Substitute Loan, a
corresponding Substitution Event with respect to one or more Loans then in the
Collateral;

 

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(iii) after giving effect to the inclusion of the applicable Substitute Loans in
the Collateral, (x) the Portfolio Acquisition and Disposition Requirements are
satisfied and (y) the Substitute Loan Qualification Conditions are satisfied
with respect to such Substitute Loan; provided that for purposes of measuring
the Portfolio Criteria, any Substitute Loan that does not have a rating from
Moody’s as of the applicable Cut-Off Date will be deemed to have a Moody’s
Rating as determined by the Servicer in accordance with the criteria set forth
in the definition of “Moody’s Rating” pending receipt of a rating estimate from
Moody’s;

(iv) the Originator and the Trust Depositor shall have delivered to the Issuer
and the Trustee a Subsequent List of Loans listing the applicable Substitute
Loans and an assignment agreement as required by the related Underlying Loan
Agreement indicating that the Issuer is the holder of the related Substitute
Loan;

(v) the Originator shall have deposited or caused to be deposited in the
Principal and Interest Account all Collections received by it with respect to
the applicable Substitute Loans on and after the related Cut-Off Date;

(vi) each of the representations and warranties made by the Originator pursuant
to Sections 3.02 (including without limitation that each such Substitute Loan is
an Eligible Loan) and 3.04 applicable to the Substitute Loans shall be true and
correct as of the related Cut-Off Date;

(vii) the Originator shall bear all incidental transactions costs incurred in
connection with a substitution effected pursuant to this Agreement and shall, at
its own expense, on or prior to the related Cut-Off Date, indicate in its
Computer Records that ownership of each Substitute Loan identified on the
Subsequent List of Loans has been sold by the Originator to the Trust Depositor
and by the Trust Depositor to the Issuer pursuant to the Transfer and Servicing
Agreements; and

(viii) prior to such substitution the Originator shall provide written notice to
Moody’s.

(e) At all times, (i) the aggregate Outstanding Loan Balances (plus Exposure
Amounts) of all Loans that are Substitute Loans (other than a substitution
occurring as a result of a Substitution Event pursuant to clause (f) of the
definition thereof) plus (ii) the aggregate Transfer Deposit Amount related to
all Loans that have been repurchased by the Originator pursuant to its right of
optional repurchase or substitution (other than a substitution occurring as a
result of a Substitution Event pursuant to clause (f) of the definition thereof)
and not subsequently applied to purchase a Substitute Loan may not exceed an
amount equal to 15% of the Aggregate Outstanding Loan Balance as of the
Effective Date; provided that clause (ii) above shall not include (A) the
Transfer Deposit Amount related to any Loan that is repurchased by the
Originator in connection with a proposed Specified Amendment to such Loan so
long as (x) the Originator certifies to the Servicer and the Trustee that such
purchase is, in the commercially reasonable business judgment of the Originator,
necessary or advisable in connection with the restructuring of such Loan and
such restructuring is expected to result in a Specified Amendment to such Loan,
and (y) the Servicer certifies to the Trustee that the Servicer either

 

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would not be permitted to or would not elect to enter into such Specified
Amendment pursuant to the Credit and Collection Policy, the Servicing Standard
or any provision of the Transfer and Servicing Agreements or (B) the purchase
price of any Loans or, for the avoidance of doubt, any Equity Securities sold by
the Issuer to the Originator in accordance with Section 2.05 of the Sale and
Servicing Agreement.

Section 2.05 Conveyance of Additional Loans.

(a) The Trust Depositor may, at any time during the Ramp-Up Period and subject
to the conditions set forth in this Section 2.05, acquire Additional Loans from
the Originator hereunder and transfer such Additional Loans to the Issuer under
the Sale and Servicing Agreement to the extent the Issuer has Unused Proceeds
available therefor, until the Aggregate Outstanding Loan Balance equals or
exceeds the Expected Aggregate Outstanding Loan Balance. The purchase price paid
by the Trust Depositor for any Additional Loan shall be an amount equal to
(x) in the case of a Loan originated by the Originator, the outstanding
principal amount thereof or (y) in the case of a Loan acquired by the Originator
from an unaffiliated third party, the purchase price (expressed as a percentage
of par) paid for such Loan by the Originator multiplied by the outstanding
principal amount thereof, as applicable. The purchase price may equal, exceed or
be less than the fair market value of such Additional Loan as of the related
Cut-Off Date.

(b) Upon the acquisition of any Additional Loan Assets pursuant to and in
accordance with this Section 2.05, the Trust Depositor will convey such
Additional Loan Assets to the Issuer pursuant to Section 2.06 of the Sale and
Servicing Agreement and, upon the pledge by the Issuer of such Additional Loan
Assets to the Trustee for the benefit of the Noteholders, such Additional Loan
Assets shall become part of the Collateral subject to the Lien of the Indenture.
With respect to any Additional Loans to be conveyed to the Trust Depositor by
the Originator as described in Section 2.05(a), the Originator hereby sells,
transfers, assigns, sets over and otherwise conveys to the Trust Depositor,
without recourse other than as expressly provided herein (and the Trust
Depositor shall purchase through cash payment and/or by exchange of one or more
related Loans released by the Issuer to the Trust Depositor on the related
Cut-Off Date), all the right, title and interest of the Originator in and to the
Additional Loan Assets.

(c) The Originator shall transfer to the Trust Depositor hereunder and the Trust
Depositor shall transfer to the Issuer under the Sale and Servicing Agreement
the applicable Additional Loan Assets only upon the satisfaction of each of the
following conditions on or prior to the related Cut-Off Date (and the delivery
of a related Addition Notice by the Trust Depositor shall be deemed a
representation and warranty by the Issuer, the Trust Depositor and the
Originator that such conditions are satisfied as of the related Cut-Off Date):

(i) the Trust Depositor shall have provided the Issuer and the Trustee with a
timely Addition Notice complying with the definition thereof, which Addition
Notice shall be delivered no later than 11:00 a.m. on the related Cut-Off Date;
provided that the inclusion of the applicable Additional Loans in the Collateral
shall be accomplished in compliance with the Portfolio Acquisition and
Disposition Requirements;

 

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(ii) [Reserved];

(iii) the Originator and the Trust Depositor shall have delivered to the Issuer
and the Trustee a Subsequent List of Loans listing the applicable Additional
Loans and an assignment agreement as required by the related Underlying Loan
Agreement indicating that the Issuer is the holder of the related Additional
Loan;

(iv) the Originator shall have deposited or caused to be deposited in the
Principal and Interest Account all Collections received by it with respect to
the applicable Additional Loans on and after the related Cut-Off Date;

(v) as of each Cut-Off Date, the Originator is not insolvent nor will it be
rendered insolvent by such transfer nor is it aware of any pending insolvency;

(vi) no selection procedures believed by the Originator to be adverse to the
interests of the Holders shall have been utilized in selecting the Additional
Loans; and

(vii) each of the representations and warranties made by the Originator pursuant
to Sections 3.02 (including without limitation that each such Additional Loan is
an Eligible Loan) and 3.04 applicable to the Additional Loans shall be true and
correct as of the related Cut-Off Date.

(d) The Originator shall, at its own expense, on or prior to the related Cut-Off
Date, indicate in its Computer Records that ownership of each Additional Loan
identified on the Subsequent List of Loans has been sold by the Originator to
the Trust Depositor and by the Trust Depositor to the Issuer pursuant to the
Transfer and Servicing Agreements.

(e) The Originator shall deliver prior written notice of the inclusion of an
Additional Loan to Moody’s.

Section 2.06 Release of Excluded Amounts.

The parties acknowledge and agree that the Trust Depositor has no interest in
the Excluded Amounts. Immediately upon the release to the Trust Depositor by the
Issuer of any Excluded Amounts, the Trust Depositor hereby irrevocably agrees to
release to the Originator such Excluded Amounts, which release shall be
automatic and shall require no further act by the Trust Depositor; provided that
the Trust Depositor shall execute and deliver such instruments of release and
assignment or other documents, or otherwise confirm the foregoing release of
such Excluded Amounts, as may be reasonably requested by the Originator in
writing.

Section 2.07 Delivery of Documents in the Loan File; Recording of Assignments of
Mortgage.

(a) Subject to the delivery requirements set forth in Section 2.07(b), the
Originator shall deliver, on behalf of the Trust Depositor, possession of all
the Loan Files to the Trustee on behalf of and for the account of the
Noteholders. The Originator shall also identify on the List of Loans (including
any deemed amendment thereof associated with any Additional Loans or Substitute
Loans), whether by attached schedule or marking or other effective identifying
designation, all Loans that are evidenced by such instruments.

 

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(b) With respect to each Loan in the Collateral, at least two Business Days
before the Closing Date in the case of the Initial Loans and two Business Days
before the related Cut-Off Date in the case of any Additional Loans or
Substitute Loans (or, in each case, such lesser time as shall be acceptable to
the Trustee), the Originator or the Trust Depositor will deliver or cause to be
delivered to the Trustee, to the extent not previously delivered, each of the
documents in the Loan File with respect to such Loan, except that (i) to the
extent required to be delivered pursuant to the Sale and Servicing Agreement as
part of the Required Loan Documents with respect to such Loan, the original
recorded Mortgage, in those instances where a copy thereof certified by a
Responsible Officer of the Originator was delivered to the Trustee as a Required
Loan Document pursuant to clause (b)(iii)(x) of the definition thereof, will be
delivered or caused to be delivered within ten Business Days after receipt
thereof, and in any event within one year after the Closing Date in the case of
the Initial Loans and the related Cut-Off Date in the case of any Additional
Loans or Substitute Loans, and (ii) to the extent required to be delivered
pursuant to the Sale and Servicing Agreement as part of the Required Loan
Documents with respect to such Loan, any intervening Assignments of Mortgage, in
those instances where copies thereof certified by a Responsible Officer the
Originator were delivered to the Trustee as a Required Loan Document pursuant to
clause (b)(iii)(y) of the definition thereof, will be delivered or caused to be
delivered within ten Business Days after the receipt thereof, and in any event,
within one year after the Closing Date in the case of the Initial Loans and the
related Cut-Off Date in the case of any Additional Loans of Substitute Loans.
Notwithstanding the foregoing clauses (i) and (ii) of this Section 2.07(b), in
those instances where the public recording office retains the original Mortgage
or the intervening Assignments of Mortgage after it has been recorded, the
Originator or the Trust Depositor (as applicable) shall be deemed to have
satisfied its obligations hereunder upon delivery to the Trustee of a copy of
such Mortgage or Assignments of Mortgage certified by the public recording
office to be a true copy of the recorded original thereof.

ARTICLE III

REPRESENTATIONS AND WARRANTIES

The Originator makes, and upon each conveyance of Additional Loans or Substitute
Loans, as applicable, is deemed to make, the representations and warranties in
Section 3.01 through Section 3.04, on which the Trust Depositor will rely in
conveying the Initial Loan Assets on the Closing Date (and, except for the
representations and warranties in Section 3.03 which only apply to the Initial
Loans as of the Closing Date, Additional Loan Assets and Substitute Loan Assets,
as the case may be, on any Cut-Off Date) to the Issuer, and on which the Issuer
and the Securityholders will rely. The Originator acknowledges that such
representations and warranties are being made by the Originator for the benefit
of the Issuer and the Securityholders.

Such representations and warranties are given as of the execution and delivery
of this Agreement and as of the Closing Date (or Cut-Off Date, as applicable),
but shall survive the sale, transfer and assignment of the Loan Assets to the
Trust Depositor and by the Trust Depositor to the Issuer. The repurchase
obligation or substitution obligation of the Originator set forth in
Section 6.01 constitutes the sole remedy available for a breach of a
representation or warranty of the Originator set forth in Section 3.01 through
Section 3.04 of this Agreement.

 

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Section 3.01 Representations and Warranties Regarding the Originator.

The Originator represents and warrants that:

(a) Organization and Good Standing. The Originator is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware and has the power to own its assets and to transact the business in
which it is currently engaged. The Originator is duly qualified to do business
as a foreign corporation and is in good standing in each jurisdiction in which
the character of the business transacted by it or properties owned or leased by
it requires such qualification and in which the failure so to qualify would have
a material adverse effect on the business, properties, assets, or condition
(financial or otherwise) of the Originator.

(b) Authorization; Valid Sale; Binding Obligations. The Originator has the power
and authority to make, execute, deliver and perform this Agreement and the other
Transaction Documents to which it is a party and all of the transactions
contemplated under this Agreement and the other Transaction Documents to which
it is a party, and to create the Trust Depositor and cause it to make, execute,
deliver and perform its obligations under this Agreement and the other
Transaction Documents to which it is a party and has taken all necessary
corporate action to authorize the execution, delivery and performance of this
Agreement and the other Transaction Documents to which it is a party and to
cause the Trust Depositor to be created. This Agreement shall effect a valid
sale, transfer and assignment of or grant of a security interest in the Loan
Assets from the Originator to the Trust Depositor, enforceable against the
Originator and creditors of and purchasers from the Originator. This Agreement
and the other Transaction Documents to which the Originator is a party
constitute the legal, valid and binding obligation of the Originator enforceable
in accordance with their terms, except as enforcement of such terms may be
limited by applicable Insolvency Laws and general principles of equity, whether
considered in a suit at law or in equity.

(c) No Consent Required. The Originator is not required to obtain the consent of
any other party (other than those that it has already obtained) or any consent,
license, approval or authorization from, or registration or declaration with,
any Governmental Authority (other than those that it has already obtained) in
connection with the execution, delivery, performance, validity or enforceability
of this Agreement or the other Transaction Documents to which it is a party.

(d) No Violations. The execution, delivery and performance by the Originator of
this Agreement and the other Transaction Documents to which it is a party, and
the consummation of the transactions contemplated hereby and thereby, will not
violate in any material respect any Applicable Law applicable to the Originator,
or conflict with, result in a default under or constitute a breach of the
Originator’s organizational documents or the Contractual Obligations to which
the Originator is a party or by which the Originator or any of the Originator’s
properties may be bound, or result in the creation or imposition of any Lien of
any kind upon any of its properties pursuant to the terms of any such
Contractual Obligations, other than as contemplated by the Transaction
Documents.

 

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(e) Litigation. No litigation or administrative proceeding of or before any
court, tribunal or governmental body is currently pending, or to the knowledge
of the Originator threatened, against the Originator or any of its properties or
with respect to this Agreement, the other Transaction Documents to which it is a
party or the Securities (1) that, if adversely determined, would in the
reasonable judgment of the Originator be expected to have a material adverse
effect on the business, properties, assets or condition (financial or otherwise)
of the Originator or the transactions contemplated by this Agreement or the
other Transaction Documents to which the Originator is a party or (2) seeking to
adversely affect the federal income tax or other federal, state or local tax
attributes of the Certificate or Notes.

(f) Solvency. The Originator, at the time of and after giving effect to each
conveyance of Loan Assets hereunder, is Solvent on and as of the date thereof.

(g) Taxes. The Originator has filed or caused to be filed all tax returns which,
to its knowledge, are required to be filed and has paid all taxes shown to be
due and payable on such returns or on any assessments made against it or any of
its property and all other taxes, fees or other charges imposed on it or any of
its property by any Governmental Authority (other than any amount of tax due,
the validity of which is currently being contested in good faith by appropriate
proceedings and with respect to which reserves in accordance with generally
accepted accounting principles have been provided on the books of the
Originator); no tax Lien has been filed and, to the Originator’s knowledge, no
claim is being asserted, with respect to any such tax, fee or other charge.

(h) Place of Business; No Changes. The Originator’s location (within the meaning
of Article 9 of the UCC) is the State of Delaware. The Originator has not
changed its name, whether by amendment of its Certificate of Incorporation, by
reorganization or otherwise, and has not changed its location within the four
months preceding the Closing Date.

(i) Not an Investment Company. Neither the Originator nor the pool of Loan
Assets is required to be registered as an “investment company” within the
meaning of the 1940 Act.

(j) Sale Treatment. Other than for accounting and tax purposes, the Originator
has treated the transfer of Loan Assets to the Trust Depositor for all purposes
as a sale and purchase on all of its relevant books and records.

(k) Security Interest.

(i) This Agreement creates a valid and continuing security interest (as defined
in the applicable UCC) in favor of the Trust Depositor in all right, title and
interest of the Originator in the Loan Assets, which security interest is prior
to all other Liens (except for Permitted Liens), and is enforceable as such
against creditors of and purchasers from the Originator;

 

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(ii) the Loans, along with the related Loan Files, constitute “general
intangibles,” “instruments,” “accounts,” “investment property,” or “chattel
paper,” within the meaning of the applicable UCC;

(iii) the Originator owns and has, and upon the sale and transfer thereof by the
Originator to the Trust Depositor, the Trust Depositor will have good and
marketable title to such Loan Assets free and clear of any Lien (other than
Permitted Liens), claim or encumbrance of any Person;

(iv) the Originator has received all consents and approvals required by the
terms of the Loan Assets to the sale of the Loan Assets hereunder to the Trust
Depositor;

(v) the Originator has caused the filing of all appropriate financing statements
in the proper filing office in the appropriate jurisdictions under Applicable
Law in order to perfect the security interest in the Loan Assets granted to the
Trust Depositor under this Agreement to the extent perfection can be achieved by
filing a financing statement;

(vi) other than the security interest granted to the Trust Depositor pursuant to
this Agreement, the Originator has not pledged, assigned, sold, granted a
security interest in or otherwise conveyed any of the Loan Assets, except in
connection with the Warehouse Facilities, which security interests will be
terminated and released on or prior to the applicable transfer date. The
Originator has not authorized the filing of and is not aware of any financing
statements naming the Originator as debtor that include a description of
collateral covering the Loan Assets other than any financing statement
(A) relating to the security interest granted to the Trust Depositor under this
Agreement, or (B) that has been terminated or for which a release or partial
release has been filed. The Originator is not aware of the filing of any
judgment or tax Lien filings against the Originator;

(vii) all original executed copies of each Underlying Note (if any) that
constitute or evidence the Loan Assets have been delivered to the Trustee and,
in the case of Noteless Loans, the documents required pursuant to clause
(b)(i)(y) of the definition of Required Loan Documents have been delivered to
the Trustee;

(viii) except with respect to Noteless Loans, the Originator has received a
written acknowledgment from the Trustee that the Trustee or its bailee is
holding any Underlying Notes that constitute or evidence any Loan Assets solely
on behalf of and for the benefit of the Securityholders; and

(ix) none of the Underlying Notes that constitute or evidence any Loan Assets
has any marks or notations indicating that they have been pledged, assigned or
otherwise conveyed to any Person other than the Trust Depositor.

 

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(l) Value Given. The cash payments and the corresponding increase in the
Originator’s equity interest in the Trust Depositor received by the Originator
in respect of the purchase price of the Loan Assets sold hereunder constitute
reasonably equivalent value in consideration for the transfer to the Trust
Depositor of such Loan Assets under this Agreement, such transfer was not made
for or on account of an antecedent debt owed by the Originator to the Trust
Depositor, and such transfer was not and is not voidable or subject to avoidance
under any Insolvency Law.

(m) No Defaults. The Originator is not in default with respect to any order or
decree of any court or any order, regulation or demand of any federal, state,
municipal or governmental agency, which default might have consequences that
would materially and adversely affect the condition (financial or otherwise) or
operations of the Originator or its respective properties or might have
consequences that would materially and adversely affect its performance
hereunder.

(n) Bulk Transfer Laws. The transfer, assignment and conveyance of the Loans by
the Originator pursuant to this Agreement are not subject to the bulk transfer
laws or any similar statutory provisions in effect in any applicable
jurisdiction.

(o) Origination and Collection Practices. The origination and collection
practices used by the Originator and any of its Affiliates with respect to each
Loan have been consistent with the Servicing Standard and comply in all material
respects with the Credit and Collection Policy.

(p) Lack of Intent to Hinder, Delay or Defraud. Neither the Originator nor any
of its Affiliates sold, or will sell, any interest in any Loan Asset with any
intent to hinder, delay or defraud any of their respective creditors.

(q) Nonconsolidation. The Originator conducts its affairs such that the Trust
Depositor would not be substantively consolidated in the estate of the
Originator and their respective separate existences would not be disregarded in
the event of the Originator’s bankruptcy.

(r) Accuracy of Information. All written factual information heretofore
furnished by the Originator for purposes of or in connection with this Agreement
or the other Transaction Documents to which the Originator is a party, or any
transaction contemplated hereby or thereby is, and all such written factual
information hereafter furnished by the Originator to any party to the
Transaction Documents will be, true and accurate in all material respects, on
the date such information is stated or certified; provided that the Originator
shall not be responsible for any factual information furnished to it by any
third party not affiliated with it, or the Trust Depositor or the Servicer,
except to the extent that a Responsible Officer of the Originator has actual
knowledge that such factual information is inaccurate in any material respect.

The representations and warranties set forth in Section 3.01(k) may not be
waived by any Person and shall survive the termination of this Agreement. The
Originator and the Trust Depositor (i) shall not, without satisfaction of the
Moody’s Rating Condition with respect thereto, waive any breach of the
representations and warranties in Section 3.01(k), and (ii) shall provide
Moody’s with prompt written notice upon obtaining knowledge of any breach of the
representations and warranties set out in Section 3.01(k).

 

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Section 3.02 Representations and Warranties Regarding Each Loan and as to
Certain Loans in the Aggregate.

The Originator represents and warrants (x) with respect to Sections 3.02(a) and
Section 3.02(b) as to each Initial Loan as of the Closing Date, and as of each
Cut-Off Date with respect to each Additional Loan and each Substitute Loan, and
(y) with respect to Section 3.02(c), as to the Initial Loans in the aggregate as
of the Closing Date, and as of each Cut-Off Date with respect to Additional
Loans and Substitute Loans (after giving effect to the addition of such
Additional Loans and Substitute Loans to the Collateral), that:

(a) List of Loans. The information set forth in the List of Loans attached to
the Sale and Servicing Agreement as Exhibit G (as the same may be amended or
deemed amended in respect of a conveyance of Additional Loans or Substitute
Loans on a Cut-Off Date) is true, complete and correct as of the Closing Date,
in the case of the Initial Loans, or the applicable Cut-Off Date in the case of
Additional Loans or Substitute Loans.

(b) Eligible Loan. Such Loan satisfies the criteria for the definition of
Eligible Loan set forth in the Sale and Servicing Agreement as of the date of
its conveyance hereunder; provided that this representation and warranty is made
to the Originator’s actual knowledge with respect to subclauses (vi), (vii),
(x) and (xiv) of clause (ee) of the definition of Eligible Loan; provided,
further, that this representation and warranty is made to the Originator’s
actual knowledge as it relates to the origination and servicing practices of the
servicers primarily responsible for servicing Third Party Agented Loans with
respect to clauses (f), (h), (y), (aa) and subclauses (ii), (v), (vi), (vii) and
(xx) of clause (ee) of the definition of Eligible Loan.

(c) Loans Secured by Real Property. Less than 40% of the Aggregate Outstanding
Loan Balance of the Initial Loans as of the Closing Date consists of Loans
principally secured by real property, and the Originator will not effectuate the
transfer of an Additional Loan or a Substitute Loan if such transfer would cause
more than 40% of the Aggregate Outstanding Loan Balance of the Loans included in
the Collateral as of any Cut-Off Date to consist of Loans principally secured by
real property.

Section 3.03 [Reserved].

Section 3.04 Representations and Warranties Regarding the Required Loan
Documents.

The Originator represents and warrants on the Closing Date with respect to the
Initial Loans (or as of the related Cut-Off Date, with respect to Additional
Loans and Substitute Loans), that except as otherwise provided in Section 2.07,
the Required Loan Documents and each other item identified on each Loan
Checklist with respect to the Loan File for each Loan are in the possession of
the Trustee.

Section 3.05 [Reserved].

Section 3.06 Representations and Warranties Regarding the Trust Depositor.

 

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By its execution of this Agreement, the Trust Depositor represents and warrants
to the Originator that:

(a) Organization and Good Standing. The Trust Depositor is a limited liability
company duly organized, validly existing and in good standing under the laws of
Delaware and has the power to own its assets and to transact the business in
which it is currently engaged. The Trust Depositor is duly qualified to do
business as a foreign entity and is in good standing in each jurisdiction in
which the character of the business transacted by it or properties owned or
leased by it requires such qualification and in which the failure so to qualify
would have a material adverse effect on the business, properties, assets or
condition (financial or other) of the Trust Depositor or the Issuer.

(b) Authorization; Valid Sale; Binding Obligations. The Trust Depositor has the
power and authority to make, execute, deliver and perform this Agreement and the
other Transaction Documents to which it is a party and all of the transactions
contemplated under this Agreement and the other Transaction Documents to which
it is a party, and to create the Issuer and cause it to make, execute, deliver
and perform its obligations under this Agreement and the other Transaction
Documents to which the Issuer is a party, and the Trust Depositor has taken all
necessary limited liability company action to authorize the execution, delivery
and performance of this Agreement and the other Transaction Documents to which
it is a party and to cause the Issuer to be created. This Agreement shall effect
a valid sale, transfer and assignment of or grant a security interest in the
Loan Assets from the Originator to the Trust Depositor. This Agreement and the
other Transaction Documents to which the Trust Depositor is a party constitute
the legal, valid and binding obligation of the Trust Depositor enforceable in
accordance with their respective terms, except as enforcement of such terms may
be limited by applicable Insolvency Laws and general principles of equity,
whether considered in a suit at law or in equity.

(c) No Consent Required. The Trust Depositor is not required to obtain the
consent of any other party (other than those that it has already obtained) or
any consent, license, approval or authorization from, or registration or
declaration with, any Governmental Authority (other than those that it has
already obtained) in connection with the execution, delivery, performance,
validity or enforceability of this Agreement or the other Transaction Documents
to which it is a party.

(d) No Violations. The execution, delivery and performance by the Trust
Depositor of this Agreement and the other Transaction Documents to which it is a
party by the Trust Depositor, and the consummation of the transactions
contemplated hereby and thereby, will not violate in any material respect any
Applicable Law applicable to the Trust Depositor, or conflict with, result in a
default under or constitute a breach of the Trust Depositor’s organizational
documents or any Contractual Obligations to which the Trust Depositor is a party
or by which the Trust Depositor or any of the Trust Depositor’s properties may
be bound, or result in the creation or imposition of any Lien of any kind upon
any of its properties pursuant to the terms of any such Contractual Obligations,
other than as contemplated by the Transaction Documents.

 

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(e) Litigation. No litigation or administrative proceeding of or before any
court, tribunal or governmental body is currently pending, or to the knowledge
of the Trust Depositor threatened, against the Trust Depositor or any of its
properties or with respect to this Agreement, the other Transaction Documents to
which it is a party or the Securities (i) that, if adversely determined, would
in the reasonable judgment of the Trust Depositor be expected to have a material
adverse effect on the business, properties, assets or condition (financial or
otherwise) of the Trust Depositor or the Issuer or the transactions contemplated
by this Agreement or the other Transaction Documents to which the Trust
Depositor is a party or (ii) seeking to adversely affect the federal income tax
or other federal, state or local tax attributes of the Securities.

(f) Solvency. The Trust Depositor, at the time of, and after giving effect to
each conveyance of Loan Assets hereunder and under the Sale and Servicing
Agreement, is as of the date hereof and as of such other dates, Solvent.

(g) Taxes. The Trust Depositor has filed or caused to be filed all tax returns
which, to its knowledge, are required to be filed and has paid all taxes shown
to be due and payable on such returns or on any assessments made against it or
any of its property and all other taxes, fees or other charges imposed on it or
any of its property by any Governmental Authority (other than any amount of tax
due, the validity of which is currently being contested in good faith by
appropriate proceedings and with respect to which reserves in accordance with
generally accepted accounting principles have been provided on the books of the
Trust Depositor); no tax Lien has been filed and, to the Trust Depositor’s
knowledge, no claim is being asserted, with respect to any such tax, fee or
other charge.

(h) Place of Business; No Changes. The Trust Depositor’s location (within the
meaning of Article 9 of the UCC) is the State of Delaware. The Trust Depositor
has not changed its name, whether by amendment of its certificate of formation,
by reorganization or otherwise, and has not changed its location, within the
four months preceding the Closing Date.

(i) Not an Investment Company. The Trust Depositor is not and, after giving
effect to the transactions contemplated by the Transaction Documents, will not
be required to be registered as an “investment company” within the meaning of
the 1940 Act.

(j) Sale Treatment. Other than for accounting and tax purposes, the Trust
Depositor has treated the transfer of Loan Assets from the Originator for all
purposes as a sale and purchase on all of its relevant books and records and
other applicable documents.

ARTICLE IV

PERFECTION OF TRANSFER AND PROTECTION OF SECURITY INTERESTS

Section 4.01 Custody of Loans.

The contents of each Loan File shall be held in the custody of the Trustee under
the terms of the Sale and Servicing Agreement for the benefit of, and as agent
for, the Securityholders.

 

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Section 4.02 Filing.

On or prior to the Closing Date, the Originator shall cause the UCC financing
statement(s) referred to in Section 2.02(f) hereof to be filed. Notwithstanding
the obligations of the Originator set forth in the preceding sentence, the Trust
Depositor hereby authorizes the Servicer to prepare and file, at the expense of
the initial Servicer, such UCC financing statements (including but not limited
to renewal, continuation or in lieu statements) and amendments or supplements
thereto or other instruments as the Servicer may from time to time deem
necessary or appropriate in order to perfect and maintain the security interest
granted hereunder in accordance with the UCC.

Section 4.03 Changes in Name, Corporate Structure or Location.

(a) During the term of this Agreement, the Originator shall not change its name,
principal place of business, form of organization, existence, state of formation
or location without first giving at least 30 days’ prior written notice to the
Trust Depositor and Servicer.

(b) If any change in the Originator’s name, form of organization, existence,
state of formation, location or other action would make any financing or
continuation statement or notice of ownership interest or Lien relating to any
Loan Asset seriously misleading within the meaning of applicable provisions of
the UCC or any title statute, the Originator, or the Servicer on its behalf, no
later than five Business Days after the effective date of such change, shall
file such amendments as may be required (including, but not limited to, any
filings and other acts necessary or advisable under the UCC of each relevant
jurisdiction) to preserve and protect the Trust Depositor’s, the Issuer’s and
the Trustee’s interests in the Loan Assets and the proceeds thereof.

Section 4.04 Costs and Expenses.

The initial Servicer will be obligated to pay all reasonable costs and
disbursements in connection with the perfection and the maintenance of
perfection, as against all third parties, of the Trust Depositor’s and Issuer’s
right, title and interest in and to the Loan Assets (including, without
limitation, the security interests in the Related Property related thereto and
the security interests provided for in the Indenture); provided that to the
extent permitted by the Underlying Loan Agreements, the Servicer may seek
reimbursement for such costs and disbursements from the related Obligors.

Section 4.05 Sale Treatment.

Other than for accounting and tax purposes, the Originator shall treat the
transfer of Loan Assets made hereunder for all purposes as a sale and purchase
on all of its relevant books and records.

Section 4.06 Separateness from Trust Depositor.

The Originator agrees to take or refrain from taking or engaging in with respect
to the Trust Depositor, each of the actions or activities specified in the
“substantive consolidation” opinion of Dechert LLP (including any certificates
of the Originator delivered in connection therewith) delivered on the Closing
Date, upon which the conclusions therein are based.

 

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ARTICLE V

COVENANTS OF THE ORIGINATOR

Section 5.01 Corporate Existence.

During the term of this Agreement, the Originator will keep in full force and
effect its existence, rights and franchises as a corporation under the laws of
the jurisdiction of its formation and will obtain and preserve its qualification
to do business in each jurisdiction in which such qualification is or shall be
necessary to protect the validity and enforceability of this Agreement, the
other Transaction Documents and each other instrument or agreement necessary or
appropriate for the proper administration of this Agreement and the transactions
contemplated hereby. In addition, all transactions and dealings between the
Originator and the Trust Depositor will be conducted on an arm’s-length basis.

Section 5.02 Loans Not to Be Evidenced by Promissory Notes.

The Originator will take no action to cause any Loan not originally evidenced by
an Underlying Note to be evidenced by an instrument (as defined in the UCC),
except in connection with the enforcement or collection of such Loan.

Section 5.03 Security Interests.

The Originator will not sell, pledge, assign or transfer to any Person other
than the Trust Depositor, or grant, create, incur, assume or suffer to exist any
Lien on any Loan in the Collateral or its interest in any Related Property,
other than the Lien granted to the Trust Depositor, whether now existing or
hereafter transferred to the Trust Depositor, or any interest therein. The
Originator will promptly notify the Trust Depositor upon obtaining knowledge of
the existence of any Lien on any Loan in the Collateral or its interest in any
Related Property; and the Originator shall defend the right, title and interest
of the Trust Depositor in, to and under the Loans in the Collateral and the
Trust Depositor’s interest in any Related Property, against all claims of third
parties; provided that nothing in this Section 5.03 shall prevent or be deemed
to prohibit the Originator from suffering to exist Permitted Liens upon any of
the Loans in the Collateral or its interest in any Related Property.

Section 5.04 Compliance with Law.

The Originator hereby agrees to comply in all material respects with all
Applicable Law applicable to the Originator except where the failure to do so
would not have a material adverse effect on the Securityholders.

Section 5.05 Liability of Originator.

The Originator shall be liable in accordance herewith only to the extent of the
obligations specifically undertaken by the Originator under this Agreement.

 

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Section 5.06 Limitation on Liability of Originator and Others.

The Originator and any director, officer, employee or agent of the Originator
may rely in good faith on any document of any kind, prima facie properly
executed and submitted by the appropriate Person respecting any matters arising
hereunder. The Originator shall not be under any obligation to appear in,
prosecute or defend any legal action that shall not be incidental to its
obligations under this Agreement, and that in its opinion may involve it in any
expense or liability.

Section 5.07 Reserved.

Section 5.08 Merger or Consolidation of Originator.

Any Person into which the Originator may be merged or consolidated, or any
Person resulting from such merger, conversion or consolidation to which the
Originator is a party, or any Person succeeding to substantially all of the
business of the Originator shall be the successor to the Originator hereunder,
without execution or filing of any paper or any further act on the part of any
of the parties hereto, notwithstanding anything herein to the contrary; provided
that no such merger, conversion or consolidation of the Originator or sale of
all or substantially all of its assets or its business shall be permitted
hereunder unless the Rating Agency Condition is satisfied with respect thereto,
the consent of the Majority Noteholders is obtained or the Originator, so long
as the Originator is the Servicer, appoints a Successor Servicer that meets the
requirements set forth in Section 5.12 of the Sale and Servicing Agreement.

Section 5.09 Delivery of Collections.

The Originator agrees to deliver to the Servicer promptly (but in no event later
than two Business Days after receipt) all Collections received by the Originator
in respect of a Loan, for application in accordance with Section 7.05 of the
Sale and Servicing Agreement.

Section 5.10 Underlying Custodial Agreements.

The Originator agrees to fully cooperate with the Trust Depositor, the Issuer
and the Trustee, and from and after the occurrence and during the continuance of
an Event of Default or Servicer Default to take such actions as may be requested
in the sole and absolute discretion of the Trust Depositor, the Issuer or the
Trustee, under any Underlying Loan Agreements, including taking any and all
actions that may be requested by the Trust Depositor, the Issuer or the Trustee
in connection with the preparation, filing and recording of any Assignments of
Mortgage held by any underlying custodians. The Originator further agrees to
fully cooperate with the Trust Depositor, the Issuer and the Trustee, and from
and after the occurrence and during the continuance of an Event of Default or
Servicer Default to take such actions as may be requested in the sole and
absolute discretion of the Trust Depositor, the Issuer or the Trustee to cause
to be defended, enforced, preserved and protected the rights and privileges of
the Trust Depositor, the Issuer, the Trustee and the Secured Parties under or
with respect to the Underlying Loan Agreements and any underlying loan documents
or other collateral held by the underlying custodians.

 

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Section 5.11 Payments from Concentration Account.

The Originator agrees not to make, or consent to, any change in the direction
of, or instructions with respect to, any payments to be made by an Obligor in
any manner that would diminish, impair, delay or otherwise adversely affect the
timing or receipt of such payments into a Concentration Account without the
prior written consent of the Trustee and with the consent of the Majority
Noteholders; provided that if the Originator changes the Qualified Institution
in which any Concentration Account is held, the Originator may provide
instructions to Obligors to make payments to such new Concentration Account.

ARTICLE VI

REMEDIES UPON MISREPRESENTATION; REPURCHASE OPTION

Section 6.01 Repurchases of, or Substitution for, Loans for Breach of
Representations and Warranties.

Upon a discovery by a Responsible Officer of the Servicer or any subservicer, a
Responsible Officer of the Owner Trustee or a Responsible Officer of the Trustee
of (i) a breach of a representation or warranty as set forth in Section 3.01,
Section 3.02, Section 3.03 or Section 3.04 or as made or deemed made in any
Addition Notice relating to Additional Loans or Substitute Loans, as applicable,
that materially and adversely affects the value of such Loans or the interests
of the Securityholders therein or which materially and adversely affects the
interests of the Securityholders in the related Loan in the case of a
representation or warranty relating to a particular Loan (notwithstanding that
such representation or warranty was made to the Originator’s actual knowledge)
or (ii) the failure of any Participated Loan (other than a Qualified
Participated Loan) to be converted to a full assignment within 60 days following
the Closing Date (each Loan in clauses (i) and (ii) above, an “Ineligible
Loan”), the party discovering the breach shall give prompt written notice to the
other parties and to the Originator; provided that neither the Owner Trustee nor
the Trustee shall have a duty or obligation to inquire or to investigate the
breach of any of such representations or warranties. Within 30 days of the
earlier of (x) its discovery or (y) its receipt of notice of any breach of a
representation or warranty or a failure of any Participated Loan (other than a
Qualified Participated Loan) to be converted to a full assignment, the
Originator shall (a) promptly cure such breach in all material respects,
(b) repurchase each such Ineligible Loan by depositing on behalf of the Trust
Depositor in the Principal and Interest Account, within such 30 day period, an
amount equal to the Transfer Deposit Amount for such Ineligible Loan, or
(c) remove such Loan from the Collateral and effect a substitution for such
affected Loan with a Substitute Loan in accordance with the substitution
requirements set forth in Section 2.04 not later than the date a repurchase of
such affected Loan would be required hereunder; provided that with respect to a
breach of a representation or warranty relating to the Loans in the aggregate
and not to any particular Loan, the Originator may select Loans (without adverse
selection) to repurchase (or substitute for) such that had such Loans not been
included as part of the Loan Assets (and, in the case of a substitution, had
such Substitute Loan been included as part of the Loan Assets instead of the
selected Loan) there would have been no breach of such representation or
warranty.

 

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Section 6.02 Reassignment of Repurchased or Substituted Loans.

Upon receipt by the Trustee for deposit in the Principal and Interest Account of
the amounts described in Section 6.01 (or upon the Cut-Off Date related to a
Substitute Loan described in Section 6.01), and upon receipt of an Officer’s
Certificate of the Servicer in the form attached as Exhibit F to the Sale and
Servicing Agreement, the Trustee and the Issuer shall assign to the Trust
Depositor and the Trust Depositor shall assign to the Originator all of the
Trustee’s and the Issuer’s (or Trust Depositor’s, as applicable) right, title
and interest in the Loans being repurchased or substituted for the related Loan
Assets without recourse, representation or warranty. Such reassigned Loan shall
no longer thereafter be included in any calculations of Outstanding Loan
Balances or otherwise be deemed a part of the Collateral.

ARTICLE VII

INDEMNIFICATION BY THE ORIGINATOR

Section 7.01 Indemnification.

The Originator agrees to indemnify, defend and hold harmless the Trust
Depositor, its officers, directors, employees and agents (any one of which is an
“Indemnified Party”) from and against any and all claims, losses, penalties,
fines, forfeitures, reasonable legal fees and related costs, judgments (provided
that any indemnification for damages is limited to actual damages, not
consequential, special or punitive damages), reasonable legal fees and related
costs and any other reasonable costs, fees and expenses that such Person may
sustain as a result of the Originator’s fraud or the failure of the Originator
to perform its duties in compliance with the terms of this Agreement, except to
the extent arising from gross negligence, willful misconduct or fraud by the
Person claiming indemnification. Any Person seeking indemnification hereunder
shall promptly notify the Originator if such Person receives a complaint, claim,
compulsory process or other notice of any loss, claim, damage or liability
giving rise to a claim of indemnification hereunder but failure to provide such
notice shall not relieve the Originator of its indemnification obligations
hereunder unless the Originator is deprived of material substantive or
procedural rights or defenses as a result thereof. The Originator shall assume
(with the consent of the Indemnified Party, such consent not to be unreasonably
withheld) the defense and any settlement of any such claim and pay all expenses
in connection therewith, including reasonable counsel fees, and promptly pay,
discharge and satisfy any judgment or decree which may be entered against the
Indemnified Party in respect of such claim. If the consent of the Indemnified
Party required in the immediately preceding sentence is unreasonably withheld,
the Originator shall be relieved of its indemnification obligations hereunder
with respect to such Person. The parties agree that the provisions of this
Section 7.01 shall not be interpreted to provide recourse to the Originator
against loss by reason of the bankruptcy, insolvency or lack of creditworthiness
of an Obligor with respect to a Loan. The Originator shall have no liability for
making indemnification hereunder to the extent any such indemnification
constitutes recourse for uncollectible or uncollected Loans.

Section 7.02 Liabilities to Obligors.

Except with respect to the funding commitment assumed by the Issuer with respect
to any Delayed Draw Term Loan or Revolving Loan, no obligation or liability to
any Obligor under any of the Loans is intended to be assumed by the Trust
Depositor, the Trustees, the Issuer or the Securityholders under or as a result
of this Agreement and the transactions contemplated hereby.

 

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Section 7.03 Operation of Indemnities.

If the Originator has made any indemnity payments to an Indemnified Party
pursuant to this Article VII and such Indemnified Party thereafter collects any
such amounts from others, such Indemnified Party will repay such amounts
collected to the Originator.

ARTICLE VIII

MISCELLANEOUS

Section 8.01 Amendment.

(a) This Agreement may be amended from time to time by the parties hereto by
written agreement, with the prior written consent of the Trustee but without the
consent of any Securityholder, to (i) cure any ambiguity or to correct or
supplement any provisions herein, (ii) comply with any changes in the Code, USA
PATRIOT Act, or U.S. securities laws (including the regulations implementing
such laws), (iii) conform this Agreement to the Offering Memorandum, or
(iv) make any other provisions with respect to matters or questions arising
under this Agreement which shall not be inconsistent with the provisions of this
Agreement; provided that (x) notice of such proposed amendment must be sent to
all Securityholders at least ten Business Days prior to the execution of such
amendment and (y) such amendment shall not, as evidenced by an Opinion of
Counsel delivered to the Trustee, materially adversely affect the interests of
any Noteholder, which Opinion of Counsel may rely upon an Officer’s Certificate
of the Servicer with respect to the effect of any such amendment on the economic
interests of any Noteholder.

(b) Except as provided in Section 8.01(a) hereof, this Agreement may be amended
from time to time by the parties hereto by written agreement, with the prior
written consent of the Trustee and with the consent of the Majority Noteholders
and with notice to the Owner Trustee, for the purpose of adding any provisions
to or changing in any manner or eliminating any of the provisions of this
Agreement or of modifying in any manner the rights of the Securityholders;
provided that (i) if such amendment materially and adversely affects any Class
of Notes, such amendment shall also require the consent of the majority of the
Outstanding Principal Balance of such Class of Notes and (ii) no such amendment
shall reduce in any manner the amount of, or delay the timing of, any amounts
received on Loans which are required to be distributed on any Note or the
Certificate without the consent of the Holder of such Note or the Certificate or
reduce the percentage of Securityholders that are required to consent to any
such amendment without the consent of the Securityholders holding 100% of the
Notes or the Certificate affected thereby.

(c) Prior to the execution of any amendment pursuant to this Section 8.01, the
Originator shall obtain written confirmation from Moody’s that entry into such
amendment satisfies the Moody’s Rating Condition. In the event that the Moody’s
Rating Condition (i) is not satisfied with respect to any proposed amendment to
this Agreement, such amendment may become effective

 

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with the consent of each Holder of a Rated Note that will have its rating
qualified, reduced or withdrawn as a result of such amendment or (ii) in the
reasonable judgment of the Originator cannot otherwise be obtained, such
amendment may become effective with the consent of each Holder of a Rated Note.

(d) Promptly after the execution of any such amendment or consent, written
notification of the substance of such amendment or consent shall be furnished by
the Trustee to the Noteholders and by the Owner Trustee to the
Certificateholders. It shall not be necessary for the consent of any
Securityholders required pursuant to Section 8.01(b) to approve the particular
form of any proposed amendment or consent, but it shall be sufficient if such
consent shall approve the substance thereof. The manner of obtaining such
consents and of evidencing the authorization by the Securityholders of the
execution thereof shall be subject to such reasonable requirements as the
Trustee may prescribe for the Noteholders and as the Owner Trustee may prescribe
for the Certificateholders.

(e) Prior to the execution of any amendment to this Agreement, the Owner Trustee
and the Trustee shall be entitled to receive and conclusively rely upon an
Opinion of Counsel (which Opinion of Counsel may rely upon an Officer’s
Certificate of the Servicer with respect to the effect of any such amendment on
the economic interests of any Securityholders) stating that the execution of
such amendment is authorized or permitted by this Agreement. Each of the Trustee
and the Owner Trustee may, but shall not be obligated to, enter into or consent
to any such amendment that affects such Person’s own rights, duties, indemnities
or immunities under this Agreement or otherwise.

Section 8.02 Governing Law.

(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW
PROVISIONS, AND THE OBLIGATIONS, RIGHTS, AND REMEDIES OF THE PARTIES UNDER THE
AGREEMENT SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

(b) EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH
THIS AGREEMENT. EACH PARTY HERETO (I) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVER AND (II) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN
INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS
AND CERTIFICATIONS IN THIS SECTION 8.02(b).

 

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Section 8.03 Notices.

All notices, demands, certificates, requests and communications hereunder
(“notices”) shall be in writing and shall be effective (a) upon receipt when
sent through the U.S. mails, registered or certified mail, return receipt
requested, postage prepaid, with such receipt to be effective the date of
delivery indicated on the return receipt, or (b) one Business Day after delivery
to an overnight courier, or (c) on the date personally delivered to a
Responsible Officer of the party to which sent, or (d) on the date transmitted
by legible telecopier or electronic mail transmission with a confirmation of
receipt, in all cases addressed to the recipient as follows:

(i) if to the Servicer or the Originator:

NewStar Financial, Inc.

500 Boylston Street

Suite 1250

Boston, Massachusetts 02116

Attention: Brian Forde

Re: NewStar Commercial Loan Trust 2009-1

Telephone: (617) 848-2500

Facsimile No.: (617) 848-4300

Email: Brian.Forde@newstarfin.com

(ii) if to the Trust Depositor:

NewStar Commercial Loan LLC 2009-1

500 Boylston Street

Suite 1250

Boston, Massachusetts 02116

Attention: Brian Forde

Re: NewStar Commercial Loan Trust 2009-1

Telephone: (617) 848-2500

Facsimile No.: (617) 848-4300

Email: Brian.Forde@newstarfin.com

(iii) if to the Trustee:

U.S. Bank National Association

One Federal Street, 3rd Floor

Boston, Massachusetts 02110

Attention: Corporate Trust Services

Facsimile No.: (503) 258-6028

Email: kyle.harcourt@usbank.com and steven.garrett@usbank.com

 

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(iv) if to the Owner Trustee:

Wilmington Trust Company

1100 North Market Street

Wilmington, Delaware 19890

Attention: Corporate Trust Administration

Facsimile No.: (302) 636-4140

Email: yhowell@wilmingtontrust.com

with a copy to:

the Originator and the Servicer as provided in clause (i) above

(v) if to the Issuer:

NewStar Commercial Loan Trust 2009-1

c/o Wilmington Trust Company

1100 North Market Street

Wilmington, Delaware 19890

Attention: Corporate Trust Administration

Facsimile No.: (302) 636-4140

Email: yhowell@wilmingtontrust.com

with a copy to:

the Originator and the Servicer as provided in clause (i) above

(vi) if to Moody’s:

Moody’s Investors Service

99 Church Street

New York, New York 10007

Attention: ABS Monitoring Department

Facsimile No.: (212) 553-0344

Email: cdomonitoring@moodys.com

 

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(vii) if to the Initial Purchaser:

Wells Fargo Securities, LLC

One Wachovia Center, Mail Code: NC0602

301 South College Street, 8th Floor

Charlotte, North Carolina 28288-0610

Attention: Asset-Backed Finance

Re: NewStar Commercial Loan Trust 2009-1

Facsimile No.: (704) 374-6495

Email: scp.mmloans@wachovia.com

Each party hereto may, by notice given in accordance herewith to each of the
other parties hereto, designate any further or different address to which
subsequent notices shall be sent.

Section 8.04 Severability of Provisions.

If one or more of the covenants, agreements, provisions or terms of this
Agreement shall be for any reason whatsoever prohibited or held invalid or
unenforceable, then such covenants, agreements, provisions or terms shall be
deemed severable from the remaining covenants, agreements, provisions or terms
of this Agreement and shall in no way affect the validity or enforceability of
the other provisions of this Agreement, the Notes or Certificates or the rights
of the Securityholders, and any such prohibition, invalidity or unenforceability
in any jurisdiction shall not invalidate or render unenforceable such covenants,
agreements, provisions or terms in any other jurisdiction.

Section 8.05 Third Party Beneficiaries.

Except as otherwise specifically provided herein, the parties hereto hereby
manifest their intent that no third party (other than the Issuer, the Trustee
and the Owner Trustee) shall be deemed a third party beneficiary of this
Agreement, and specifically that the Obligors are not third party beneficiaries
of this Agreement.

Section 8.06 Counterparts.

This Agreement may be executed by facsimile signature and in several
counterparts, each of which shall be an original and all of which shall together
constitute but one and the same instrument.

Section 8.07 Headings.

The headings of the various Articles and Sections herein are for convenience of
reference only and shall not define or limit any of the terms or provisions
hereof.

 

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Section 8.08 No Bankruptcy Petition; Disclaimer.

(a) Each of the Originator and the Trust Depositor covenants and agrees that,
prior to the date that is one year and one day (or, if longer, the preference
period then in effect and one day) after the payment in full of all amounts
owing in respect of all outstanding Classes of Notes rated by any Rating Agency,
it will not institute against the Trust Depositor (in the case of the
Originator), or the Issuer, or join any other Person in instituting against the
Trust Depositor or the Issuer, any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings or other similar proceedings under the
laws of the United States or any state of the United States. This Section 8.08
will survive the termination of this Agreement.

(b) The provisions of this Section 8.08 shall be for the third party benefit of
those entitled to rely thereon, including the Securityholders, and shall survive
the termination of this Agreement.

Section 8.09 Jurisdiction.

Any legal action or proceeding with respect to this Agreement may be brought in
the courts of the United States for the Southern District of New York, and by
execution and delivery of this Agreement, each party hereto consents, for itself
and in respect of its property, to the non-exclusive jurisdiction of those
courts. Each such party irrevocably waives any objection, including any
objection to the laying of venue or based on the grounds of forum non
conveniens, which it may now or hereafter have to the bringing of any action or
proceeding in such jurisdiction in respect of this Agreement or any document
related hereto.

Section 8.10 Prohibited Transactions with Respect to the Issuer.

The Originator shall not:

(a) Provide credit to any Noteholder or Certificateholder for the purpose of
enabling such Noteholder or Certificateholder to purchase Notes or Certificates,
respectively;

(b) Purchase any Notes or Certificates in an agency or trustee capacity; or

(c) Except in its capacity as Servicer as provided in the Sale and Servicing
Agreement, lend any money to the Issuer.

Section 8.11 No Partnership.

Nothing herein contained shall be deemed or construed to create a co-partnership
or joint venture between the parties hereto.

Section 8.12 Successors and Assigns.

This Agreement shall inure to the benefit of and be binding upon the parties
hereto and their respective successors and permitted assigns.

Section 8.13 Duration of Agreement.

This Agreement shall continue in existence and effect until the termination of
the Sale and Servicing Agreement.

 

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Section 8.14 Limited Recourse.

The obligations of the Trust Depositor and the Originator under this Agreement
and the other Transaction Documents are solely the limited liability company or
corporate obligations, as applicable, of the Trust Depositor and the Originator,
respectively. No recourse shall be had for the payment of any amount owing by
the Trust Depositor or the Originator or otherwise under this Agreement, any
other Transaction Document or for the payment by the Trust Depositor or the
Originator of any fee in respect hereof or thereof or any other obligation or
claim of or against the Trust Depositor or the Originator arising out of or
based upon this Agreement or any other Transaction Document, against any
Affiliate, shareholder, partner, manager, member, director, officer, employee,
representative or agent of the Trust Depositor or the Originator or of any
Affiliate of such Person. The provisions of this Section 8.14 shall survive the
termination of this Agreement.

[Remainder of Page Intentionally Left Blank.]

 

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

 

NEWSTAR FINANCIAL, INC.,

as the Originator

By:   /S/    JOHN J. FRISHKOPF         Name:   John J. Frishkopf Title:  
Treasurer

NEWSTAR COMMERCIAL LOAN LLC 2009-1,

as the Trust Depositor

By:   NewStar Financial, Inc., its designated manager By:   /S/    JOHN J.
FRISHKOPF         Name:   John J. Frishkopf Title:   Treasurer

 

NewStar Commercial Loan Trust 2009-1

Commercial Loan Sale Agreement

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Exhibit A

Form of Assignment

January 7, 2010

In accordance with the Commercial Loan Sale Agreement (the “Agreement”), dated
as of January 7, 2010, made by and between the undersigned, NewStar Financial,
Inc., as the Originator, and NewStar Commercial Loan LLC 2009-1, as the Trust
Depositor (the “Trust Depositor”), as assignee thereunder, the undersigned does
hereby sell, transfer, convey and assign, set over and otherwise convey to the
Issuer, on behalf of the Trust Depositor, all of the Originator’s right, title
and interest in and to the following:

(i) the Initial Loans listed in the initial List of Loans, all payments paid in
respect thereof and all monies due, to become due or paid in respect thereof
accruing on and after the Closing Date and all Insurance Proceeds, Liquidation
Proceeds, Released Mortgaged Property Proceeds and other recoveries thereon, in
each case as they arise after the Closing Date;

(ii) all security interests and Liens and Related Property subject thereto from
time to time purporting to secure payment by Obligors under such Loans;

(iii) all guaranties, indemnities and warranties, and other agreements or
arrangements of whatever character from time to time supporting or securing
payment of such Loans;

(iv) the Transaction Accounts and the Concentration Accounts, together with all
cash and investments in each of the foregoing but only to the extent, in respect
of the Concentration Accounts, relating to the Loans;

(v) all collections and records (including Computer Records) with respect to the
foregoing;

(vi) all documents relating to the applicable Loan Files; and

(vii) all income, payments, proceeds and other benefits of any and all of the
foregoing, including but not limited to, all accounts, cash and currency,
chattel paper, electronic chattel paper, tangible chattel paper, copyrights,
copyright licenses, equipment, fixtures, general intangibles, instruments,
commercial tort claims, deposit accounts, inventory, investment property, letter
of credit rights, software, supporting obligations, accessions, and other
property consisting of, arising out of, or related to the foregoing, but
excluding any Excluded Amount with respect thereto.

Capitalized terms used herein have the meaning given such terms in the
Agreement.

This Assignment is made pursuant to and in reliance upon the representations and
warranties on the part of the undersigned contained in Article III of the
Agreement and no others.

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IN WITNESS WHEREOF, the undersigned has caused this Assignment to be duly
executed on the date written above.

 

NEWSTAR FINANCIAL, INC. By:     Name:     Title:    

 

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