Exhibit 10.36

THIRD AMENDED AND RESTATED

MASTER REPURCHASE AGREEMENT

Dated as of October 12, 2018

among

PARLEX 2 FINANCE, LLC,

PARLEX 2A FINCO, LLC,

PARLEX 2 UK FINCO, LLC,

PARLEX 2 EUR FINCO, LLC,

PARLEX 2 AU FINCO, LLC,

and any other Person when such Person joins as a Seller under

this Agreement from time to time

individually and/or collectively, as the context requires, as Seller,

and

CITIBANK, N.A.,

as Buyer

 

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TABLE OF CONTENTS

 

         Page  

1.

 

APPLICABILITY

     1  

2.

 

DEFINITIONS

     1  

3.

 

INITIATION; CONFIRMATION; TERMINATION; FEES

     34  

4.

 

MARGIN MAINTENANCE

     41  

5.

 

INCOME PAYMENTS AND PRINCIPAL PAYMENTS

     46  

6.

 

SECURITY INTEREST

     50  

7.

 

PAYMENT, TRANSFER AND CUSTODY

     51  

8.

 

SALE, TRANSFER, HYPOTHECATION OR PLEDGE OF PURCHASED LOANS

     56  

9.

 

INTENTIONALLY OMITTED

     56  

10.

 

REPRESENTATIONS

     56  

11.

 

NEGATIVE COVENANTS OF SELLER

     61  

12.

 

AFFIRMATIVE COVENANTS OF SELLER

     62  

13.

 

SINGLE-PURPOSE ENTITY

     65  

14.

 

EVENTS OF DEFAULT; REMEDIES

     67  

15.

 

SINGLE AGREEMENT

     73  

16.

 

RECORDING OF COMMUNICATIONS

     73  

17.

 

NOTICES AND OTHER COMMUNICATIONS

     74  

18.

 

ENTIRE AGREEMENT; SEVERABILITY

     74  

19.

 

NON-ASSIGNABILITY

     74  

20.

 

GOVERNING LAW

     76  

21.

 

NO WAIVERS, ETC.

     76  

22.

 

USE OF EMPLOYEE PLAN ASSETS

     76  

23.

 

INTENT

     76  

24.

 

DISCLOSURE RELATING TO CERTAIN FEDERAL PROTECTIONS

     78  

25.

 

CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL

     79  

26.

 

NO RELIANCE

     80  

27.

 

INDEMNITY

     80  

28.

 

DUE DILIGENCE

     81  

29.

 

SERVICING

     82  

 

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30.

 

MISCELLANEOUS

     83  

31.

 

TAXES

     84  

32.

 

JOINT AND SEVERAL OBLIGATIONS

     87  

 

 

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ANNEXES AND EXHIBITS

 

ANNEX I    Names and Addresses for Communications between Parties and Wire
Instructions SCHEDULE I    Prohibited Transferees EXHIBIT I    Form of
Confirmation EXHIBIT II    Authorized Representatives of Seller EXHIBIT III   
Form of Custodial Delivery EXHIBIT IV    Eligible Loan Due Diligence Checklist
EXHIBIT V-A    Form of Power of Attorney for U.S. Purchased Loans EXHIBIT V-B   
Form of Power of Attorney for Foreign Purchased Loans EXHIBIT VI-I   
Representations and Warranties Regarding Each Individual Purchased Loan Which Is
Not a Foreign Purchased Loan (AU) or a Participation Interest in a Whole Loan
EXHIBIT VI-II    Representations and Warranties Regarding Each Individual
Purchased Loan Which Is a Participation Interest in a Whole Loan EXHIBIT VI-III
   Representations and Warranties Regarding Each Individual Purchased Loan Which
Is a Foreign Purchased Loan (AU) EXHIBIT VII    Collateral Tape EXHIBIT VIII   
Form of Transaction Request EXHIBIT IX    Form of Request for Margin Excess
EXHIBIT X    Form of Irrevocable Direction Letter EXHIBIT XI    Form of Joinder
Agreement EXHIBIT XII    Form of Facility Asset Chart

 

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THIRD AMENDED AND RESTATED MASTER REPURCHASE AGREEMENT, dated as of October 12,
2018, by and among PARLEX 2 FINANCE, LLC, a Delaware limited liability company
(“Parlex 2”), PARLEX 2A FINCO, LLC, a Delaware limited liability company
(“Parlex 2A”), PARLEX 2 UK FINCO, LLC, a Delaware limited liability company
(“Parlex 2 UK”), PARLEX 2 EUR FINCO, LLC, a Delaware limited liability company
(“Parlex 2 EUR”), PARLEX 2 AU FINCO, LLC, a Delaware limited liability company
(“Parlex 2 AU”, and together with Parlex 2, Parlex 2A, Parlex 2 UK, Parlex 2 AU
and any other Person when such Person joins as a Seller hereunder from time to
time, individually and/or collectively as the context may require, “Seller”) and
CITIBANK, N.A., a national banking association (“Buyer”).

 

1.

APPLICABILITY

From time to time during the Facility Availability Period, the parties hereto
may enter into transactions in which Seller agrees to transfer to Buyer
Purchased Loans against the transfer of funds by Buyer, with a simultaneous
agreement by Buyer to transfer to Seller such Purchased Loans at a date certain,
against the transfer of funds by Seller. Each such transaction shall be referred
to herein as a “Transaction” and, unless otherwise agreed in writing, shall be
governed by this Agreement, including any supplemental terms or conditions
contained in any exhibits identified herein as applicable hereunder.

This Agreement amends, restates and replaces in its entirety that certain Second
Amended and Restated Master Repurchase Agreement, dated as of March 31, 2017
(the “Second Amendment and Restatement Date”), by and among Parlex 2, Parlex 2A,
Parlex 2 UK, Parlex 2 EUR and Buyer, as amended by that certain First Amendment
to Second Amended and Restated Master Repurchase Agreement, dated as of
December 21, 2017, by and among Parlex 2, Parlex 2A, Parlex 2 UK, Parlex 2 EUR,
Guarantor and Buyer, and as further amendment by that certain Second Amendment
to Second Amended and Restated Master Repurchase Agreement, dated as of
March 30, 2018, by and among Parlex 2, Parlex 2A, Parlex 2 UK, Parlex 2 EUR,
Guarantor and Buyer (collectively, the “Original Agreement”). Seller and Buyer
acknowledge and agree that the Original Agreement shall be void and of no force
or effect from and after the date hereof. All Transactions (as defined in the
Original Agreement) outstanding under the Original Agreement as of the Third
Amendment and Restatement Date shall be deemed to be Transactions (as defined in
this Agreement) outstanding under this Agreement and all Confirmations (as
defined in the Original Agreement) under the Original Agreement as of the Third
Amendment and Restatement Date shall be deemed to be Confirmations under this
Agreement (and, accordingly, in each case, subject to the terms and conditions
hereof) and all references in any Transaction Document (including, without
limitation, any and all Confirmations and assignment documentation executed
pursuant to the Original Agreement) to “the Agreement” or any similar
formulation intended to refer to the Original Agreement shall be deemed to be
references to this Agreement.

 

2.

DEFINITIONS

“Accelerated Repurchase Date” shall have the meaning specified in
Section 14(b)(i) of this Agreement.

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“Acceptable Attorney” means (i) Ropes & Gray LLP, (ii) a firm of solicitors
regulated by the Solicitors Regulation Authority (with respect to any Foreign
Purchased Loan secured by Mortgaged Property located in England) reasonably
acceptable to Buyer, (iii) Herbert Smith Freehills LLP, or (iv) any other
attorney-at-law or law firm reasonably acceptable to Buyer, or notary (if
required in the relevant jurisdiction) that has, in the case of each of
(i) through (iv) herein, delivered at Seller’s request an Attorney’s Bailee
Letter, as applicable.

“Accepted Servicing Practices” shall have the meaning given to such term in the
Servicing Agreement (or, if not defined therein, shall mean with respect to any
Purchased Loan, those mortgage servicing practices of prudent mortgage lending
institutions which service whole mortgage loans (and senior interests in whole
mortgage loans) in the jurisdiction where the related Mortgaged Property is
located).

“Account Security Agreement” shall mean, with respect to a Foreign Purchased
Loan, an agreement creating security over a bank account maintained by the
related Mortgagor.

“Act of Insolvency” shall mean, with respect to any Person, (a) the filing of a
decree or order for relief by a court having jurisdiction over such Person or
any substantial part of its assets or property in an involuntary case under any
applicable Insolvency Law now or hereafter in effect which (i) results in the
entry of an order for relief or (ii) is not dismissed within 90 days, (b) the
appointment by a court having jurisdiction over such Person or any substantial
part of its assets or property, of a receiver, liquidator, assignee, custodian,
trustee, sequestrator, administration or similar official for such Person or for
any substantial part of its assets or property and such appointment shall remain
unstayed and in effect for a period of 90 days, (c) an order by a court having
jurisdiction over such Person or any substantial part of its assets or property
ordering the winding up or liquidation of such Person’s affairs, and such order
shall remain unstayed and in effect for a period of 90 days, (d) the
commencement by such Person of a voluntary case under any applicable Insolvency
Law now or hereafter in effect, (e) the consent by such Person to the entry of
an order for relief in an involuntary case under any Insolvency Law, (f) the
consent by such Person to the appointment of or taking possession by a receiver,
liquidator, assignee, custodian, trustee, sequestrator or similar official for
such Person or for any substantial part of its assets or property, (g) the
making by such Person of any general assignment for the benefit of creditors, or
(h) the admission in writing in connection with a legal proceeding of the
inability of such Person to pay its debts generally as they become due.

“Actual Knowledge” shall mean, as of any date of determination, the then current
actual knowledge of Stephen Plavin, Thomas C. Ruffing and Douglas Armer, without
duty of further inquiry or investigation; provided, that if any such individual
ceases to be an officer of or in the employ of Seller and/or Guarantor after the
date of this Agreement in a capacity comparable to the capacity occupied as of
the date of this Agreement, then Seller shall designate promptly another
individual reasonably acceptable to Buyer for purposes of satisfying this
definition.

“Affiliate” shall mean, when used with respect to any specified Person, any
other Person directly or indirectly Controlling, Controlled by, or under common
Control with, such Person.

“AFSL” shall have the meaning specified in Section 24(d) of this Agreement.

 

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“Agreement” shall mean this Third Amended and Restated Master Repurchase
Agreement, dated as of the date first set forth above, by and among Parlex 2,
Parlex 2A, Parlex 2 UK, Parlex 2 EUR, Parlex 2 AU and Citibank, N.A., as such
agreement may be amended, modified, supplemented, and/or restated and in effect
from time to time.

“Alternative Rate” shall have the meaning specified in the Fee Agreement.

“Alternative Rate Transaction” shall mean, with respect to any Pricing Rate
Period, any Transaction with respect to which the Pricing Rate for such Pricing
Rate Period is determined with reference to the Alternative Rate.

“ANZVPS” shall mean the Australia and New Zealand Valuation and Property
Standards published by the Australian Property Institute and the Property
Institute of New Zealand.

“Applicable Currency” means U.S. Dollars, Pounds Sterling, Euro, AU Dollars or
such other currency permitted by Buyer, in its sole discretion, as applicable.

“Applicable Spread” shall mean, with respect to each Transaction:

(i) so long as no Event of Default shall have occurred and be continuing, the
number of basis points (i.e., 1 basis point equals 0.01%) determined in
accordance with the Pricing Matrix, and confirmed in the related Confirmation;
or

(ii) after the occurrence and during the continuance of an Event of Default, the
applicable incremental per annum rate described in clause (i) of this
definition, as applicable, plus 400 basis points (4.00%).

It is understood and agreed that no improvement or decline in the LTV (Loan UPB)
after the applicable Purchase Date for a Purchased Loan shall result in any
adjustment to the Applicable Spread for such Purchased Loan.

“Applicable Standard of Discretion” shall mean: (a) at any time the Maximum LTV
(Purchase Price) of a Purchased Loan is less than or equal to the LTV (Loan UPB)
of such Purchased Loan as of the Purchase Date, Buyer’s commercially reasonable
discretion, and (b) at any time the Maximum LTV (Purchase Price) of a Purchased
Loan is greater than the LTV (Loan UPB) of such Purchased Loan as of the
Purchase Date, Buyer’s sole discretion.

“Appraisal” shall mean an Appraisal Regime-compliant appraisal addressed to
Buyer, Seller or Guarantor (or, in the case of a Purchased Loan (AU), the
facility agent or the security trustee in respect of that Purchased Loan (AU)),
and, where it is market practice in the jurisdiction where the relevant
Mortgaged Property is located, the successors and assigns of the addressee (and,
if not addressed to Buyer, containing reliance language acceptable to Buyer
(acting reasonably and having regard to market practice for appraisals in the
jurisdiction in which the relevant Mortgaged Property is located), which
language shall be made available by Seller to and approved by Buyer prior to the
applicable Purchase Date) and reasonably satisfactory to Buyer of the related
Mortgaged Property from a third party appraiser.

 

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“Appraisal Regime” shall mean: (a) with respect to U.S. Purchased Loans, FIRREA,
and (b) with respect to Foreign Purchased Loans, RICS, ANZVPS or its equivalent
in any applicable jurisdiction, as applicable.

“ARD Loan” shall mean any loan that provides that if the unamortized principal
balance thereof is not repaid by a date certain set forth in the related loan
documents, such loan will accrue additional interest at the rate specified in
the related Mortgage Note and the related Mortgagor is required to apply certain
excess monthly cash flow generated by the related Mortgaged Property to the
repayment of the outstanding principal balance on such Mortgage Loan.

“Assignment Documents in Blank” shall mean, (a) for each Purchased Loan that is
not a Participation Interest, the (i) allonge in blank (in the case of a U.S.
Purchased Loan), (ii) Transfer Certificate duly executed by Seller or transferor
(howsoever described) with the name of the transferee (howsoever described) and
dated in blank (in the case of a Foreign Purchased Loan), (iii) omnibus
assignment in blank, (iv) except in the case of each Purchased Loan that is a
Senior Interest, Assignment of Mortgage in blank, (v) except in the case of each
Purchased Loan that is a Senior Interest or a Foreign Purchased Loan (AU),
assignment of Assignment of Leases in blank, and/or (vi) equivalent of each of
the foregoing (except with respect to the Transfer Certificate referenced in
clause (ii) herein, for which there shall be no equivalent) in the relevant
non-U.S. jurisdiction and where so required by Buyer, duly executed by Seller
with the name of the transferee or assignee (howsoever described) and dated in
blank (in the case of a Foreign Purchased Loan) and (b) for each Purchased Loan
that is a Participation Interest, (i) an endorsement in blank in respect of the
related participation certificate and (ii) an assignment and assumption
agreement in blank.

“Assignment of Leases” shall mean, with respect to any Mortgage (other than in
the case of any Foreign Purchased Loan (AU)), an assignment of leases
thereunder, notice of transfer or equivalent instrument in recordable form,
sufficient under the laws of the jurisdiction wherein the Mortgaged Property is
located to reflect the assignment of leases, subject to the terms, covenants and
provisions of this Agreement.

“Assignment of Mortgage” shall mean, with respect to any Mortgage, an assignment
of the mortgage, notice of transfer or equivalent instrument in recordable or
registerable form, sufficient under the laws of the jurisdiction wherein the
related Mortgaged Property is located to reflect the assignment and pledge of
the Mortgage, subject to the terms, covenants and provisions of this Agreement.

“Attorney’s Bailee Letter ” shall mean a letter from an Acceptable Attorney, in
form and substance reasonably acceptable to Buyer, wherein such Acceptable
Attorney in possession of a Purchased Loan File (i) acknowledges receipt of such
Purchased Loan File, (ii) confirms that such Acceptable Attorney is holding the
same as bailee (in the case of U.S. Purchased Loans) or agent (in the case of
Foreign Purchased Loans), of Buyer, or solicitor of Seller (in the case of
Foreign Purchased Loans (AU)), as applicable, under such letter and (iii) agrees
that such Acceptable Attorney shall deliver such Purchased Loan File to the
Custodian by not later than the third (3rd) Business Day (or, in the case of a
Foreign Purchased Loan (AU), the tenth (10th) Business Day) following the
Purchase Date for the related Purchased Loan.

 

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“AU Dollar” and “A$” shall mean the lawful currency of the Commonwealth of
Australia.

“AU Reference Banks” shall mean (i) the Commonwealth Bank of Australia,
(ii) Westpac Banking Corporation, (iii) Australia and New Zealand Banking Group
Limited, (iv) National Australia Bank Limited, and (v) such other Person as
Buyer and Seller may agree.

“Bankruptcy Code” shall mean Title 11 of the United States Code (11 U.S.C. §
101, et seq.), as amended, modified or replaced from time to time.

“Basel II” shall mean the International Convergence of Capital Measurement and
Capital Standards, a Revised Framework published by the Basel Committee on
Banking Supervision in June 2004 in the form existing on the date of this
Agreement (but excluding any amendment arising out of Basel III).

“Basel III” shall mean:

(i) the agreements on capital requirements, a leverage ratio and liquidity
standards contained in Basel III: A global regulatory framework for more
resilient banks and banking systems, Basel III: International framework for
liquidity risk measurement, standards and monitoring and Guidance for national
authorities operating the countercyclical capital buffer published by the Basel
Committee on Banking Supervision in December 2010, each as amended, supplemented
or restated;

(ii) the rules for global systemically important banks contained in Global
systemically important banks: assessment methodology and the additional loss
absorbency requirement – Rules text published by the Basel Committee on Banking
Supervision in November 2011, as amended, supplemented or restated; and

(iii) any further guidance or standards published by the Basel Committee on
Banking Supervision relating to Basel III.

“BBSY Rate” shall mean, with respect to any Pricing Rate Period related to any
Foreign Purchased Loan (AU), the Australian Bank Bill Swap Reference Rate (bid)
administered by ASX Benchmarks Pty Limited (or any other person which takes over
administration of that rate) for a period equal in length to the relevant
Pricing Rate Period displayed on the Thomson Reuters screen BBSY page (or such
other page as may replace that page on that service, or the appropriate page of
such other information service which publishes that rate from time to time in
place of Thomson Reuters) as of 10.:30 a.m., Sydney time, on the related Pricing
Rate Determination Date (the “BBSY Screen Rate”).

If no BBSY Screen Rate is available for any Pricing Rate Period, and such
Pricing Rate Period is longer than the minimum period for which a BBSY Screen
Rate is displayed, the BBSY Rate for such Pricing Rate Period shall be the rate
which results from interpolating on a linear basis between:

 

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(i) the BBSY Screen Rate for the longest period (for which the BBSY Screen Rate
is available) which is less than such Pricing Rate Period; and

(ii) the BBSY Screen Rate for the shortest period (for which the BBSY Screen
Rate is available) which exceeds such Pricing Rate Period (the “Interpolated
BBSY Screen Rate”).

If no BBSY Screen Rate is available for any Pricing Rate Period and it is not
possible to calculate an Interpolated BBSY Screen Rate for such Pricing Rate
Period, Buyer shall request each of the AU Reference Banks quote the buying for
bills of exchange accepted by a leading Australian bank for amounts of not less
than the Repurchase Price of the applicable Transaction for a period equal to
the relevant Pricing Rate Period, as of 10:30 a.m., Sydney time, on the related
Pricing Rate Determination Date.

If at least one such offered quotation is provided, the BBSY Rate with respect
to the relevant Pricing Rate Period shall be (i) where more than one offered
quotation is provided by the AU Reference Banks, the arithmetic mean (rounded
upwards to four decimal places) of all of such offered quotations or (ii) where
only one offered quotation is provided by the AU Reference Banks, such offered
quotation (rounded upwards to four decimal places).

If at or about noon, London time, on the related Pricing Rate Determination
Date, no AU Reference Banks have provided quotations, then BBSY with respect to
the relevant Pricing Rate Period shall be the rate determined by Buyer, as a
percentage rate per annum, of the cost to Buyer of funding an amount not less
than the Repurchase Price for the applicable Transaction in AU Dollars from
whatever source it may reasonably select.

The BBSY Rate shall be determined by Buyer or its agent, which determination
shall be conclusive absent manifest error. If the calculation of the BBSY Rate
with respect to a Pricing Rate Period results in a BBSY Rate of less than zero
(0), BBSY shall be deemed to be zero (0) for all purposes of this Agreement with
respect to such Pricing Rate Period.

“Blocked Account Agreement” shall mean, individually or collectively, as the
context may require, (i) that certain Deposit Account Control Agreement, dated
as of June 12, 2013, among Buyer, Parlex 2, Servicer and the Depository,
relating to the Cash Management Account established by Parlex 2, as the same may
be amended, modified and/or restated from time to time, (ii) that certain
Deposit Account Control Agreement, dated as of January 31, 2014, among Buyer,
Parlex 2A, Servicer and the Depository, relating to the Cash Management Account
established by Parlex 2A, as the same may be amended, modified and/or restated
from time to time, (iii) that certain Deposit Account Control Agreement, dated
as of the Second Amendment and Restatement Date, among Buyer, Parlex 2 UK,
Servicer and the Depository, relating to the Cash Management Account established
by Parlex 2 UK, as the same may be amended, modified and/or restated from time
to time, (iv) that certain Deposit Account Control Agreement, dated as of the
Second Amendment and Restatement Date, among Buyer, Parlex 2 EUR, Servicer and
the Depository, relating to the Cash Management Account established by Parlex 2
EUR, as the same may be amended, modified and/or restated from time to time,
(v) that certain Deposit Account Control Agreement, dated as of the Third
Amendment and Restatement Date, among Buyer, Parlex 2 AU, Servicer and the
Depository, relating to the Cash Management Account established

 

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by Parlex 2 AU, as the same may be amended, modified and/or restated from time
to time, and (vi) each additional Deposit Account Control Agreement entered into
among a new Seller admitted to this Agreement pursuant to a Joinder Agreement,
Buyer, Servicer and the Depository and relating to a Cash Management Account
established pursuant to this Agreement by such new Seller, as the same may be
amended, modified and/or restated from time to time.

“Business Day” shall mean a day other than (i) a Saturday or Sunday, (ii) a day
on which the New York Stock Exchange or Federal Reserve Bank of New York is
authorized or obligated by law or executive order to be closed and (iii) a day
on which commercial banks in the States of New York, Pennsylvania, Kansas or
Minnesota or in London, England, Sydney, Australia, or, as it relates to a
specific Foreign Purchased Loan, the relevant non-U.S. jurisdiction in which the
Mortgaged Property securing the related Foreign Purchased Loan is located or the
laws of which otherwise govern the Purchased Loan Documents relating to the
subject Foreign Purchased Loan (or as otherwise designated in the Purchased Loan
Documents relating to the subject Foreign Purchased Loan and stated in the
related Confirmation) are authorized or obligated by law or executive order to
be closed. When used with respect to a Pricing Rate Determination Date,
“Business Day” shall mean any day other than a Saturday, a Sunday or a day on
which banks in London, England are closed for interbank or foreign exchange
transactions.

“Buyer” shall mean Citibank, N.A., or any successor or assign.

“Capital Lease Obligations” shall mean, for any Person, all obligations of such
Person to pay rent or other amounts under a lease of (or other agreement
conveying the right to use) Property to the extent such obligations are required
to be classified and accounted for as a capital lease on a balance sheet of such
Person under GAAP, and, for purposes of this Agreement, the amount of such
obligations shall be the capitalized amount thereof, determined in accordance
with GAAP.

“Capital Stock” shall mean any and all shares, interests, participations or
other equivalents (however designated) of capital stock of a corporation, any
and all equivalent equity ownership interests in a Person which is not a
corporation, including, without limitation, any and all member or other
equivalent interests in any limited liability company, and any and all warrants
or options to purchase any of the foregoing.

“Cash Management Account” shall mean, individually or collectively, as the
context may require, with respect to each Seller, a segregated interest bearing
account, in the name of such Seller for the benefit of Buyer, established at the
Depository and subject to a Blocked Account Agreement.

“Change of Control” shall mean any of the following events shall have occurred
without the prior approval of Buyer:

(i) Guarantor shall no longer own, directly or indirectly, 100% of the ownership
interest in Seller and Control, directly or indirectly, Seller;

(ii) any merger, reorganization or consolidation of Guarantor where Guarantor is
not the surviving entity; or

(iii) any conveyance, transfer, lease or disposal of all or substantially all
assets of any Seller or Guarantor to any Person or entity other than an
Affiliate of such entity.

 

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“CLO” shall mean the collateral loan obligation bond transaction issued pursuant
to the CLO Indenture.

“CLO Indenture” shall mean that certain Indenture, dated as of December 21, 2017
by and among BXMT 2017-FL1, Ltd., as Issuer, BXMT 2017-FL1, LLC, as Co-Issuer,
42-16 CLO L SELL, LLC, as Advancing Agent and Wells Fargo Bank, National
Association as Trustee and as Note Administrator, as the same may be amended,
modified and/or restated from time to time.

“CLO Participation A-1” shall have the meaning assigned to such term in each CLO
Participation Agreement.

“CLO Participation A-2” shall have the meaning assigned to such term in each CLO
Participation Agreement.

“CLO Participation Agreements” shall mean, individually or collectively as the
context requires, that certain (i) Participation Agreement and Future-Funding
Indemnification Agreement, dated as of December 21, 2017, by and among 42-16 CLO
L SELL, LLC, a Delaware corporation (the “Mortgage Lender” and the “Initial CLO
Participation A-1 Holder”), 42-16 CLO L SELL, LLC, a Delaware corporation (the
“Initial CLO Participation A-2 Holder”), Wells Fargo Bank, National Association
(the “CLO Participation Custodial Agent”) and Blackstone Mortgage Trust, Inc., a
Maryland corporation (the “Future Funding Indemnitor”) with respect to the
Purchased Loan known as “SunTrust Center”, (ii) Participation Agreement and
Future-Funding Indemnification Agreement, dated as of December 21, 2017, by and
among Mortgage Lender, Initial CLO Participation A-1 Holder, Initial CLO
Participation A-2 Holder, CLO Participation Custodial Agent and Future Funding
Indemnitor with respect to the Purchased Loan known as “Douglass Entrance”,
(iii) Participation Agreement and Future-Funding Indemnification Agreement,
dated as of December 21, 2017, by and among Mortgage Lender, Initial CLO
Participation A-1 Holder, Initial CLO Participation A-2 Holder, CLO
Participation Custodial Agent and Future Funding Indemnitor with respect to the
Purchased Loan known as “Ambassador Waikiki II” and (iv) Participation Agreement
and Future-Funding Indemnification Agreement, dated as of December 21, 2017, by
and among Mortgage Lender, Initial CLO Participation A-1 Holder, Initial CLO
Participation A-2 Holder, CLO Participation Custodial Agent and Future Funding
Indemnitor with respect to the Purchased Loan known as “Torrance Portfolio”, as
each may be amended, modified and/or restated from time to time.

“CLO Servicing Agreement” shall have the meaning assigned to such term in the
CLO Participation Agreements, as the same may be amended, modified and/or
restated from time to time.

“Code” shall mean The Internal Revenue Code of 1986 and the regulations
promulgated and rulings issued thereunder, in each case as amended, modified or
replaced from time to time.

“Collateral” shall have the meaning specified in Section 6 of this Agreement.

 

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“Collateral Tape” shall mean, with respect to each Eligible Loan, the tape
containing the fields of information set forth in Exhibit VII attached hereto
and any other similar information with respect to a Foreign Purchased Loan.

“Column A” shall have the meaning specified in the definition of Facility Asset
Chart.

“Column B” shall have the meaning specified in the definition of Facility Asset
Chart.

“Column C” shall have the meaning specified in the definition of Facility Asset
Chart.

“Column D” shall have the meaning specified in the definition of Facility Asset
Chart.

“Column E” shall have the meaning specified in the definition of Facility Asset
Chart.

“Concentration Limit” shall mean, unless otherwise agreed to in writing by Buyer
(including, without limitation, in a Confirmation), the test that shall be
satisfied at any applicable date of determination, if the aggregate outstanding
Purchase Price with respect to all Purchased Loans which are Participation
Interests shall not exceed 33% of the Facility Amount (i) which outstanding
Purchase Price for Foreign Purchased Loans shall for purposes of such
calculations be converted to U.S. Dollars based on the Purchase Date Spot Rate
(U.S. Dollars) for such Foreign Purchased Loan, and (ii) excluding for purposes
of such calculation each CLO Participation A-1 issued pursuant to a CLO
Participation Agreement for which no Concentration Limit shall be applicable.

“Confirmation” shall have the meaning specified in Section 3(b) of this
Agreement.

“Connection Income Taxes” shall mean Other Connection Taxes that are imposed on
or measured by net income (however denominated) or that are franchise Taxes or
branch profits Taxes.

“Control” shall mean the possession, direct or indirect, of the power to direct
or cause the direction of the management and policies of a Person, whether
through the ownership of voting securities or by contract and “Controlling” and
“Controlled” shall have meanings correlative thereto.

“Current Appraisal” shall mean, as of any date of determination, an Appraisal
approved by Buyer dated within six (6) months (or such greater number of months
as Buyer may approve in its sole discretion) of such date of determination.

“Custodial Agreement” shall mean, individually or collectively, as the context
may require, (i) that certain Second Amended and Restated Custodial Agreement,
dated as of the Third Amendment and Restatement Date, among the Custodian,
Sellers and Buyer, as the same may be further amended, modified and/or restated
from time to time, and (ii) each additional Custodial Agreement entered into
among a new Seller admitted to this Agreement pursuant to a Joinder Agreement,
the Custodian and Buyer, as the same may be amended, modified and/or restated
from time to time.

 

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“Custodial Delivery” shall mean the form executed by Seller in order to deliver
the Purchased Loan Schedule and the Purchased Loan File to Buyer or its designee
(including the Custodian) pursuant to Section 7 hereof, a form of which is
attached hereto as Exhibit III.

“Custodian” shall mean U.S. Bank, National Association, or any successor
Custodian appointed by Buyer with the prior written consent of Seller (which
consent shall not be unreasonably withheld or delayed).

“Debt Yield (Loan UPB)” shall mean, with respect to each Purchased Loan or
proposed Purchased Loan, as of any date of determination, the net cash flow debt
yield equal to the percentage equivalent of the quotient obtained by dividing
(a) the in place underwritten net cash flow of the related Mortgaged Property,
as determined by Buyer in its good faith business judgment, by (b) the unpaid
principal balance of such Purchased Loan or proposed Purchased Loan, as
applicable, on such date of determination.

“Debt Yield (Purchase Price)” shall mean, with respect to each Purchased Loan,
as of any date of determination, the net cash flow debt yield equal to the
percentage equivalent of the quotient obtained by dividing (a) the in place
underwritten net cash flow of the related Mortgaged Property, as determined by
Buyer in its good faith business judgment, by (b) the outstanding Purchase Price
of such Purchased Loan on such date of determination.

“Default” shall mean any event which, with the giving of notice, the passage of
time, or both, would constitute an Event of Default.

“Defeasance” shall have the meaning specified in Exhibit VI-I.

“Depository” shall mean PNC Bank, or any successor Depository appointed by
Seller with the prior written consent of Buyer (which consent shall not be
unreasonably withheld or delayed).

“Due Date (Foreign Purchased Loan (AU))” shall have the meaning given to the
term “Due Date” in the Servicing Agreement referenced in clause (v) of the
definition of Servicing Agreement.

“Due Diligence Package” shall mean: (i) the Collateral Tape, (ii) the items on
the Eligible Loan Due Diligence Checklist, in each case to the extent applicable
and (iii) such other documents or information as Buyer or its counsel shall
reasonably deem necessary.

“Early Repurchase Date” shall have the meaning specified in Section 3(d) of this
Agreement.

“Eligible Loan Due Diligence Checklist” shall mean the due diligence materials
set forth in Exhibit IV attached hereto and any other similar information with
respect to a Foreign Purchased Loan.

 

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“Eligible Loans” shall mean fixed or floating rate whole mortgage loans (“Whole
Loans”) or senior interests (including “A” notes in an “A/B” note structure) in
such Whole Loans (“Senior Interests”) or certificated participation interests in
such Whole Loans or Senior Interests which are (1) denominated in an Applicable
Currency and (2) secured by stabilized or un-stabilized multi-family or
commercial properties (including, but not limited to, office, retail, industrial
and hotel properties, but excluding, with respect to potential Foreign Purchased
Loans, development and heavy restructuring facilities), which have been approved
by Buyer in its sole discretion as a Purchased Loan and which satisfy all of the
following criteria as of the applicable Purchase Date:

(a) the Debt Yield (Loan UPB) is equal to or greater than 6.00%,

(b) the LTV (Loan UPB) is 75.00% or less (or such higher percentage as Buyer may
agree to in its sole discretion),

(c) the LTV (Aggregate Loan UPB) is 80.00% or less,

(d) a term of not more than five (5) years, and

(e) in the event the maturity date of the subject Whole Loan or Senior Interests
(or participation interests therein) shall be later than three (3) years
(inclusive of all extension terms) after the expiration of the Facility
Availability Period, then the conditions precedent to the exercise of any option
that would extend the maturity date of such Whole Loan or Senior Interests (or
participation interests therein) beyond such three (3) year period shall include
extension conditions satisfactory to Buyer, including but not limited to,
enhanced credit metrics relative to those in place at the time of such Purchased
Loan’s origination.

Eligible Loans shall also include such other loans and debt instruments (or
interests in such loans and debt instruments) as Buyer may approve from time to
time in its sole discretion, subject to terms and conditions and document
delivery requirements as may be established by Buyer.

“Environmental Law” shall mean, any federal, state, foreign or local statute,
law, rule, regulation, ordinance, code and rule of common law now or hereafter
in effect and in each case as amended, and any judicial or administrative
interpretation thereof, including any judicial or administrative order, consent
decree or judgment, relating to the environment, employee health and safety or
Hazardous Materials, including, without limitation, CERCLA; RCRA; the Federal
Water Pollution Control Act, 33 U.S.C. § 1251 et seq.; the Toxic Substances
Control Act, 15 U.S.C. § 2601 et seq.; the Clean Air Act, 42 U.S.C. § 7401 et
seq.; the Safe Drinking Water Act, 42 U.S.C. § 3803 et seq.; the Oil Pollution
Act of 1990, 33 U.S.C. § 2701 et seq.; the Emergency Planning the Community
Right-to-Know Act of 1986, 42 U.S.C. § 11001 et seq.; the Hazardous Material
Transportation Act, 49 U.S.C. § 1801 et seq.; and the Occupational Safety and
Health Act, 29 U.S.C. § 651 et seq.; and any state and local or foreign
counterparts or equivalents, in each case as amended from time to time.

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations promulgated thereunder. Section
references to ERISA are to ERISA, as in effect at the date of this Agreement
and, as of the relevant date, any subsequent provisions of ERISA, amendatory
thereof, supplemental thereto or substituted therefor.

 

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“ERISA Affiliate” shall mean any corporation or trade or business that is a
member of any group of organizations (i) described in Section 414(b) or (c) of
the Code of which Seller is a member and (ii) solely for purposes of potential
liability under Section 302 of ERISA and Section 412 of the Code and the lien
created under Section 303(k) of ERISA and Section 430(k) of the Code, described
in Section 414(m) or (o) of the Code of which Seller is a member.

“ESA” shall have the meaning specified in Exhibit VI-I.

“EURIBOR” shall mean, with respect to each Pricing Rate Period, the Euro
interbank offered rate administered by the European Money Markets Institute (or
any other person which takes over the administration of that rate), for a three
month period, that appears (a) on page EURIBOR01 of the Thomson Reuters screen
(or any replacement Thomson Reuters page which displays that rate) or (b) on the
appropriate page of such other information service which publishes that rate
from time to time in place of Thomson Reuters, in each case as of 11:00 a.m.,
Brussels time, on the related Pricing Rate Determination Date (the “EURIBOR
Screen Rate”). If such page or service ceases to be available, Buyer may specify
another page or service displaying the relevant rate after consultation with
Seller.

If the EURIBOR Screen Rate is not available, Buyer shall request the principal
London office of the Reference Banks to provide (i) (other than where clause
(ii) below applies) the rate at which the relevant Reference Bank believes one
prime bank is quoting to another prime bank for interbank term deposits in euro
within the Participating Member States for amounts of not less than the
Repurchase Price of the applicable Transaction for the three month period; or
(ii) if different, the rate (if any and applied to the relevant Reference Bank
and the three month period) which contributors to the EURIBOR Screen Rate are
asked to submit to the relevant administrator, in each case, as of 11:00 a.m.,
Brussels time, on the related Pricing Rate Determination Date.

If at least one such offered quotation is provided, EURIBOR with respect to the
relevant Pricing Rate Period related to a Foreign Purchased Loan (GBP) shall be
(i) where more than one offered quotation is provided by the Reference Banks,
the arithmetic mean (rounded upwards to four decimal places) of all of such
offered quotations or (ii) where only one offered quotation is provided by the
Reference Banks, such offered quotation (rounded upwards to four decimal
places).

If at or about noon, London time, on the related Pricing Rate Determination
Date, no Reference Banks have provided quotations, then EURIBOR with respect to
the relevant Pricing Rate Period related to a Foreign Purchased Loan (GBP) shall
be the rate determined by Buyer, as a percentage rate per annum, of the cost to
Buyer of funding an amount not less than the Repurchase Price for the applicable
Transaction from whatever source it may reasonably select.

EUBIROR shall be determined by Buyer or its agent, which determination shall be
conclusive absent manifest error. If the calculation of EURIBOR with respect to
a Pricing Rate Period results in a EURIBOR rate of less than zero (0), EURIBOR
shall be deemed to be zero (0) for all purposes of this Agreement with respect
to such Pricing Rate Period.

 

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“EURIBO Rate” shall mean, with respect to any Pricing Rate Period pertaining to
a Transaction for which EURIBOR is the applicable Pricing Rate, a rate per annum
determined for such Pricing Rate Period in accordance with the following formula
(rounded upward to the nearest 1/100th of 1%):

                     EURIBOR                    

1 – Reserve Requirement

“EURIBOR Screen Rate” shall have the meaning set forth in the definition of
EURIBOR.

“Euros” and “€” shall mean the lawful currency of the member states of the
European Union that have adopted and retain the single currency in accordance
with the Treaty establishing the European Community, as amended from time to
time; provided that if any member state or states ceases to have such single
currency as its lawful currency (such member state(s) being the “Exiting
State(s)”), Euro and € shall, for the avoidance of doubt, mean for all purposes
of this Agreement the single currency adopted and retained as the lawful
currency of the remaining member states and shall not include any successor
currency introduced by the Exiting State(s).

“Event of Default” shall have the meaning specified in Section 14(a) of this
Agreement.

“Excluded Taxes” shall mean, any of the following Taxes imposed on or with
respect to payment to Buyer or required to be withheld or deducted from such
payment, (a) Taxes imposed on or measured by net income (however denominated),
franchise Taxes, Taxes imposed on or measured by net worth (however denominated)
and branch profits Taxes, in each case, (i) imposed as a result of Buyer being
organized under the laws of, or having its principal office or the office from
which it books the Transactions located in, the jurisdiction imposing such Taxes
(or any political subdivision thereof) or (ii) that are Other Connection Taxes,
(b) U.S. federal withholding Taxes imposed on amounts payable to or for the
account of Buyer with respect to an interest in the Transactions pursuant to a
law in effect on the date on which such Party (i) acquires such interest in the
Transactions or (ii) changes its principal office or the office from which it
books the Transactions, except in each case to the extent that, pursuant to
Section 31, amounts with respect to such Taxes were payable either to such
Buyer’s assignor immediately before such Buyer became a party hereto or to such
Buyer immediately before it changed the office from which it books the
Transactions, (c) Taxes attributable to Buyer’s failure to comply with
Section 31 of this Agreement, (d) Taxes attributable to Buyer’s failure to
comply with its obligations under Sections 19(c), 19(d) or 23(i) of this
Agreement, (e) any withholding Taxes imposed under FATCA, (f) any U.S. federal
backup withholding Taxes imposed under Section 3406 of the Code, (g) an
Australian Tax required to be withheld or deducted from any interest or other
payment under Division 11A of Part III of the Income Tax Assessment Act 1936
(Cth) or the Income Tax Assessment Act 1997 (Cth) or Subdivision 12-F of
Schedule 1 to the Taxation Administration Act 1953 (Cth), and (h) any interest,
additions to tax or penalties in respect of the foregoing.

“Exit Fee” shall have the meaning specified in the Fee Agreement.

 

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“Extension Fee” shall have the meaning specified in the Fee Agreement.

“Facility Amount” shall mean, subject to Section 30(j) of this Agreement, One
Billion Dollars ($1,000,000,000); provided that whenever under this Agreement
Seller and Buyer are required or otherwise need to calculate whether the
Facility Amount has been or would be exceeded, then all applicable amounts for
Foreign Purchased Loans necessary for such calculation shall be converted to
U.S. Dollars based on the Purchase Date Spot Rate (U.S. Dollars) for such
Foreign Purchased Loan for all purposes of such calculation.

“Facility Asset Chart” shall mean a chart in the form of Exhibit XII to this
Agreement setting forth, as of any date of determination, with respect to each
Purchased Loan, (i) the current outstanding Purchase Price (under the heading
“Current Outstanding Buyer Purchase Prices” and referred to herein as “Column
A”), (ii) the current Margin Excess (Other) (under the heading “Current Margin
Excess (Other)” and referred to herein as “Column B”), (iii) the available
Margin Excess (Future Funding) (under the heading “Adjusted Margin Excess
(Future Fundings)” and referred to herein as “Column C”), (iv) the Maximum
Purchase Price (under the heading “Total of A, B, C” and referred to herein as
“Column D”), and (v) the potentially available Margin Excess (Future Funding)
(under the heading “Potential Margin Excess (Future Fundings)” and referred to
herein as “Column E”).

“Facility Availability Period” shall mean the period commencing on June 12, 2013
and ending on October 12, 2021 (or if such day is not a Business Day, the next
succeeding Business Day). Notwithstanding anything herein to the contrary, at
any time during the Facility Availability Period, Seller may request an
extension of the Facility Availability Period which extension shall be in
Buyer’s sole discretion and subject to terms and conditions determined by Buyer
in its sole discretion.

“Facility Expiration Date” shall mean the last day of the Facility Availability
Period; provided, that the Facility Expiration Date shall be extendible by
Seller on an annual basis thereafter (i.e. for consecutive twelve (12) month
periods), subject to the following:

(a) Seller delivers to Buyer a written request of the extension of the Facility
Expiration Date no earlier than ninety (90) nor later than thirty (30) days
before the then current Facility Expiration Date,

(b) no Default or Event of Default has occurred and is continuing on the date
the request to extend is delivered or on the then current Facility Expiration
Date,

(c) no Margin Deficit exists that has not been satisfied,

(d) the Concentration Limit is satisfied on the date the request to extend is
delivered and on the then current Facility Expiration Date (except to the extent
waived or otherwise approved by Buyer), and

(e) Seller shall have paid to Buyer the Extension Fee on or before the then
current Facility Expiration Date.

 

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“FATCA” shall mean Sections 1471 through 1474 of the Code, as of the date of
this Agreement (or any amended or successor version that is substantively
comparable and not materially more onerous to comply with), any current or
future regulations or official interpretations thereof and, for the avoidance of
doubt, any agreements entered into pursuant to any of the foregoing.

“FCA Regulations” shall have the meaning specified in Section 23(a) of this
Agreement.

“FDIA” shall have the meaning specified in Section 23(f) of this Agreement.

“FDICIA” shall have the meaning specified in Section 23(g) of this Agreement.

“Fee Agreement” shall mean: (i) that certain Fifth Amended and Restated Fee
Letter, dated as of the Third Amendment and Restatement Date, between Seller and
Buyer, as the same may be amended, modified and/or restated from time to time
(including through a Joinder Agreement), and (ii) each additional Fee Letter
entered into among a new Seller admitted to this Agreement pursuant to a Joinder
Agreement, the Custodian and Buyer, as the same may be amended, modified and/or
restated from time to time.

“Filings” shall have the meaning specified in Section 6.

“Financing Lease” shall mean any lease of property, real or personal, the
obligations of the lessee in respect of which are required in accordance with
GAAP to be capitalized on a balance sheet of the lessee.

“FIRREA” shall mean the Financial Institutions, Reform, Recovery and Enforcement
Act of 1989.

“First Amendment and Restatement Date” shall mean July 28, 2014.

“Foreign Assignment Agreement” shall mean, with respect to a Foreign Purchased
Loan, a security agreement or a security deed between the applicable Seller and
Buyer pursuant to which such Seller assigns by way of security to Buyer all of
its right, title and interest under and in relation to each related Purchased
Loan Document relating to such Foreign Purchased Loan (including its rights
against any Security Agent) and any professional report delivered with respect
to a Foreign Purchased Loan that is addressed to or capable of being relied on
by such Seller.

“Foreign Purchased Loan” shall mean: (i) with respect to any Transaction, an
Eligible Loan secured by Mortgaged Property located outside of the United States
of America or any territory thereof and which is sold by the applicable Seller
to Buyer in such Transaction and (ii) with respect to the Transactions for
Foreign Purchased Loans in general, all Eligible Loans secured by Mortgaged
Property located outside of the United States of America or any territory
thereof and which are sold by the applicable Sellers to Buyer.

“Foreign Purchased Loan (AU)” shall mean a Foreign Purchased Loan denominated in
AU Dollars.

 

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“Foreign Purchased Loan (EUR)” shall mean a Foreign Purchased Loan denominated
in Euros.

“Foreign Purchased Loan (GBP)” shall mean a Foreign Purchased Loan denominated
in Pounds Sterling.

“Foreign Sanctions Authority” shall mean the Financial Conduct Authority, the
Foreign & Commonwealth Office, Her Majesty’s Treasury of the United Kingdom, the
Department of Foreign Affairs and Trade of Australia, the United Nations or any
other analogous Governmental Authority in any applicable non-U.S. jurisdiction
in which a Mortgaged Property securing a Purchased Loan is located.

“Foreign Sanctions List” shall mean any sanctions or “black” list maintained by
a Foreign Sanctions Authority.

“Funding Fee” shall have the meaning specified in the Fee Agreement.

“Future Funding Conditions Precedent” shall have the meaning specified in
Section 4(c).

“GAAP” shall mean United States generally accepted accounting principles
consistently applied as in effect from time to time.

“Governmental Authority” shall mean any national or federal government, any
state, regional, local or other political subdivision thereof with jurisdiction
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government (including any supra-national bodies
such as the European Union or the European Central Bank).

“Ground Lease” shall have the meaning specified in Exhibit VI-I.

“Guarantor” shall mean Blackstone Mortgage Trust, Inc., a Maryland corporation
(or, following a substitution consummated in accordance with Section 9,
Successor Guarantor).

“Guaranty” shall mean the Limited Guaranty, dated as of June 12, 2013, from
Guarantor in favor of Buyer, as amended by that certain First Amendment to
Limited Guaranty, dated as of November 20, 2013, from Guarantor in favor of
Buyer, as further amended by that certain Second Amendment to Limited Guaranty,
dated as of February 24, 2014, from Guarantor in favor of Buyer, as further
amended by that certain Third Amendment to Limited Guaranty, dated as of the
Second Amendment and Restatement Date, from Guarantor in favor of Buyer, as
further amended by that certain Fourth Amendment to Limited Guaranty, dated as
of the Third Amendment and Restatement Date, as the same may be further amended,
modified and/or restated from time to time.

“Hedging Transactions” shall mean, with respect to any Purchased Loan that is a
fixed rate loan, any short sale of U.S. Treasury Securities or mortgage- related
securities, futures contract (including Eurodollar futures) or options contract
or any interest rate swap, cap or collar agreement or similar arrangements
providing for protection against fluctuations in interest rates

 

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or the exchange of nominal interest obligations, either generally or under
specific contingencies, entered into by Seller with either (x) Buyer or an
Affiliate of Buyer or (y) one or more other counterparties reasonably acceptable
to Buyer and, in the case of clause (y) only, assigned by Seller to Buyer as
additional collateral for the applicable Transaction.

“Income” shall mean, with respect to any Purchased Loan at any time, the sum of
(x) any principal thereof and all interest, dividends or other distributions
thereon and (y) all net sale proceeds received by Seller in connection with a
sale of such Purchased Loan to a Person other than Buyer.

“Indebtedness” shall mean, for any Person: (a) obligations created, issued or
incurred by such Person for borrowed money (whether by loan, the issuance and
sale of debt securities or the sale of Property to another Person subject to an
understanding or agreement, contingent or otherwise, to repurchase such Property
from such Person); (b) obligations of such Person to pay the deferred purchase
or acquisition price of Property or services, other than trade accounts payable
(other than for borrowed money) arising, and accrued expenses incurred, in the
ordinary course of business so long as such trade accounts payable are payable
within ninety (90) days of the date the respective goods are delivered or the
respective services are rendered; (c) Indebtedness of others secured by a Lien
on the Property of such Person, whether or not the respective Indebtedness so
secured has been assumed by such Person; (d) obligations (contingent or
otherwise) of such Person in respect of letters of credit or similar instruments
issued or accepted by banks and other financial institutions for account of such
Person; contingent or future funding obligations under any Purchased Loan or any
obligations senior to, or pari passu with, any Purchased Loan; (e) Capital Lease
Obligations of such Person; and (f) obligations of such Person under repurchase
agreements or like arrangements; (g) Indebtedness of others guaranteed by such
Person to the extent of such guarantee; and (h) all obligations of such Person
incurred in connection with the acquisition or carrying of fixed assets by such
Person. Notwithstanding the foregoing, nonrecourse Indebtedness owing pursuant
to a securitization transaction such as a REMIC securitization, a collateralized
loan obligation transaction or other similar securitization shall not be
considered Indebtedness for any person.

“Indemnified Amounts” and “Indemnified Parties” shall have the meaning specified
in Section 27 of this Agreement.

“Indemnified Taxes” shall mean: (a) Taxes, other than Excluded Taxes, imposed on
or with respect to any payment made by or on account of any obligation of Seller
under any Transaction Document and (b) Other Taxes.

“Independent Director” shall mean a duly appointed manager or member of the
board of directors (or managers) of the relevant entity who shall not have been,
at the time of such appointment or at any time while serving as a director or
manager of the relevant entity and may not have been at any time in the
preceding five (5) years, (a) a direct or indirect legal or beneficial owner in
such entity or any of its Affiliates, (b) a creditor, supplier, employee,
officer, director (other than in its capacity as Independent Director), family
member, manager or contractor of such entity or any of its Affiliates, or (c) a
Person who controls (directly, indirectly or otherwise) such entity or any of
its Affiliates or any creditor, supplier, employee, officer, director, family
member, manager or contractor of such Person or any of its Affiliates.

 

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“Index Rate” shall mean the EURIBO Rate, LIBO Rate or BBSY Rate, as applicable.

“Insolvency Laws” shall mean the Bankruptcy Code and all other applicable
liquidation, conservatorship, bankruptcy, moratorium, rearrangement,
receivership, insolvency, reorganization, suspension or payments and similar
debtor relief laws from time to time in effect affecting the rights of creditors
generally.

“Insurance Rating Requirements” shall have the meaning specified in Exhibit
VI-I.

“Irrevocable Direction Letter” shall have the meaning specified in Section 5(b).

“Joinder Agreement” shall have the meaning specified in the definition of
Seller.

“Junior Interest” shall have the meaning specified in Exhibit VI-I.

“LIBOR” shall mean:

(a) With respect to each Pricing Rate Period related to any U.S. Purchased Loan,
the rate (expressed as a percentage per annum) for deposits in U.S. Dollars, for
a one month period, that appears on “Page BBAM” of the Bloomberg Financial
Markets Services Screen (or the successor thereto) as of 11:00 a.m., London
time, on the related Pricing Rate Determination Date. If such rate does not
appear on “Page BBAM” of the Bloomberg Financial Markets Services Screen (or the
successor thereto) as of 11:00 a.m., London time, on such Pricing Rate
Determination Date, Buyer shall request the Reference Banks to provide such
bank’s offered quotation (expressed as a percentage per annum) to prime banks in
the London interbank market for deposits in U.S. Dollars for a one month period
as of 11:00 a.m., London time, on such Pricing Rate Determination Date for
amounts of not less than the Repurchase Price of the applicable Transaction. If
at least two such offered quotations are so provided, LIBOR with respect to the
relevant Pricing Rate Period related to a U.S. Purchased Loan, shall be the
arithmetic mean of such quotations. If fewer than two such quotations are so
provided, Buyer shall request any three major banks in New York City selected by
Buyer to provide such bank’s rate (expressed as a percentage per annum) for
loans in U.S. Dollars to leading European banks for a one month period as of
approximately 11:00 a.m., New York City time on the applicable Pricing Rate
Determination Date for amounts of not less than the Repurchase Price of such
Transaction. If at least two such rates are so provided, LIBOR with respect to
the relevant Pricing Rate Period related to a U.S. Purchased Loan shall be the
arithmetic mean of such rates. LIBOR with respect to each Pricing Rate Period
related to any U.S. Purchased Loan shall be determined by Buyer or its agent,
which determination shall be conclusive absent manifest error; and

(b) With respect to each Pricing Rate Period related to any Foreign Purchased
Loan (GBP), the London interbank offered rate administered by ICE Benchmark
Administration Limited (or any person which takes over the administration of
that rate) for deposits in Pounds Sterling for a three month period that appears
page LIBOR01 of the Thomson Reuters screen (or any replacement Thomson Reuters
page which displays that rate) or on the appropriate page of such other
information service which publishes that rate from time to time in place of
Thomson Reuters as of 11:00 a.m., London time, on the related Pricing Rate
Determination Date (the “LIBOR Screen Rate”). If the LIBOR Screen Rate ceases to
be available, Buyer may specify

 

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another page or service displaying the relevant rate after consultation with
Seller. If the LIBOR Screen Rate is unavailable, Buyer shall request the
principal London office of the Reference Banks to provide (i) if the Reference
Bank is a contributor to the LIBOR Screen Rate and it consists of a single
figure, the rate applied to the relevant Reference Bank and Pounds Sterling in
amounts not less than the Repurchase Price of the applicable Transaction for a
three-month period, or (ii) in any other case, the rate at which the relevant
Reference Bank could fund itself in in Pounds Sterling for amounts of not less
than the Repurchase Price of the applicable Transaction for a three-month period
with reference to the unsecured wholesale funding market as of 11:00 a.m.,
Brussels time, on the related Pricing Rate Determination Date.

If at least one such offered quotation is provided, LIBOR with respect to the
relevant Pricing Rate Period related to a Foreign Purchased Loan (GBP) shall be
(i) where more than one offered quotation is provided by the Reference Banks,
the arithmetic mean (rounded upwards to four decimal places) of all of such
offered quotations or (ii) where only one offered quotation is provided by the
Reference Banks, such offered quotation (rounded upwards to four decimal
places).

If at or about noon, London time, on the related Pricing Rate Determination
Date, no Reference Banks have provided quotations, then LIBOR with respect to
the relevant Pricing Rate Period related to a Foreign Purchased Loan (GBP) shall
be the rate determined by Buyer, as a percentage rate per annum, of the cost to
Buyer of funding an amount not less than the Repurchase Price for the applicable
Transaction from whatever source it may reasonably select.

LIBOR with respect to each Pricing Rate Period related to any Foreign Purchased
Loan (GBP) shall be determined by Buyer or its agent, which determination shall
be conclusive absent manifest error.

If the calculation of LIBOR pursuant to this definition with respect to a
Pricing Rate Period related to a Purchased Loan sold by Seller to Buyer in a
Transaction after the Second Amendment and Restatement Date results in a LIBOR
rate of less than zero (0), LIBOR shall be deemed to be zero (0) for all
purposes of this Agreement with respect to such Pricing Rate Period.

“LIBO Rate” shall mean, with respect to any Pricing Rate Period pertaining to a
Transaction for which LIBOR is the applicable Pricing Rate, a rate per annum
determined for such Pricing Rate Period in accordance with the following formula
(rounded upward to the nearest 1/100th of 1%):

                     LIBOR                    

1 – Reserve Requirement

“LIBOR Screen Rate” shall have the meaning set forth in the definition of LIBOR.

“Lien” shall mean any mortgage, lien, encumbrance, charge, trust, retention of
title or other security interest by way of, or having similar commercial effect
to, security for the payment or performance of an obligation, whether arising
under contract, by operation of law, judicial process or otherwise.

 

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“LTV (Aggregate Loan UPB)” shall mean, with respect to any Purchased Loan or
proposed Purchased Loan, the ratio, expressed as a percentage, the numerator of
which shall equal the sum of (x) the unpaid principal balance of such Purchased
Loan or proposed Purchased Loan plus (y) the unpaid principal balance of any
subordinate or mezzanine debt secured indirectly by the Mortgaged Property and
the denominator of which shall equal the “as is” value of such Mortgaged
Property securing such Purchased Loan or proposed Purchased Loan as determined
by Buyer as of the Purchase Date in its sole discretion and, in each case,
calculated using the Applicable Currency relevant to such Purchased Loan. For
purposes of determining the value of a Mortgaged Property in accordance with
this definition, (i) the value may be determined by reference to a Current
Appraisal, discounted cash flow analysis or other commercially reasonable method
and (ii) for the avoidance of doubt, Buyer may reduce value for any actual or
potential risks (including risk of delay) posed by any Liens on the related
Mortgaged Property.

“LTV (Loan UPB) ” shall mean, with respect to any Purchased Loan or proposed
Purchased Loan, the ratio, expressed as a percentage, the numerator of which
shall equal the unpaid principal balance of such Purchased Loan or proposed
Purchased Loan, as applicable, and the denominator of which shall equal the “as
is” value of the related Mortgaged Property securing such Purchased Loan or
proposed Purchased Loan, as applicable, as determined by Buyer as of the
Purchase Date in its sole discretion and, in each case, calculated using the
Applicable Currency relevant to such Purchased Loan. For purposes of determining
the value of a Mortgaged Property in accordance with this definition, (i) the
value may be determined by reference to a Current Appraisal, discounted cash
flow analysis or other commercially reasonable method and (ii) for the avoidance
of doubt, Buyer may reduce value for any actual or potential risks (including
risk of delay) posed by any Liens on the related Mortgaged Property.

“LTV (Purchase Price)” shall mean, with respect to any Purchased Loan, the
ratio, expressed as a percentage, the numerator of which shall equal the
outstanding Purchase Price of such Purchased Loan and the denominator of which
shall equal the “as is” value of the related Mortgaged Property securing such
Purchased Loan as determined by Buyer as of the Purchase Date in its sole
discretion and at all times thereafter in Buyer’s commercially reasonable
discretion and, in each case, calculated using the Applicable Currency relevant
to such Purchased Loan. For purposes of determining the value of a Mortgaged
Property in accordance with this definition, (i) the value may be determined by
reference to a Current Appraisal, discounted cash flow analysis or other
commercially reasonable method and (ii) for the avoidance of doubt, Buyer may
reduce value for any actual or potential risks (including risk of delay) posed
by any Liens on the related Mortgaged Property.

“MAI” shall have the meaning specified in Exhibit VI-I.

“Margin Amount” shall mean, with respect to any Purchased Loan as of any date of
determination, an amount equal to the product of the applicable Margin
Percentage and the outstanding Purchase Price of such Purchased Loan as of such
date.

“Margin Deficit” shall have the meaning specified in Section 4(a).

“Margin Deficit Notice” shall have the meaning specified in Section 4(b).

 

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“Margin Excess” shall mean, as applicable, Margin Excess (Future Funding) or
Margin Excess (Other).

“Margin Excess (Future Funding)” shall have the meaning specified in
Section 4(c).

“Margin Excess (Other)” shall have the meaning specified in Section 4(e).

“Margin Percentage” shall mean, with respect to any Purchased Loan as of any
date of determination, the reciprocal of the applicable Maximum Purchase Price
Percentage.

“Market Value” shall mean, with respect to any Purchased Loan, the market value
for such Purchased Loan, as determined by Buyer at the Applicable Standard of
Discretion on each Business Day in accordance with this definition. For purposes
of Section 4(a) and 5(e), as applicable, changes in the Market Value of a
Purchased Loan shall be determined solely in relation to material positive or
negative changes (relative to Buyer’s initial underwriting or the most recent
determination of Market Value in terms of the performance or condition, taken in
the aggregate, of (i) the Mortgaged Property securing the Purchased Loan or
other collateral securing or related to the Purchased Loan, (ii) the Purchased
Loan’s borrower (including obligors, guarantors, participants and sponsors) and
the borrower on any underlying property or other collateral securing such
Purchased Loan, (iii) the commercial real estate market relevant to the
Mortgaged Property, and (iv) any actual risks posed by any liens or claims on
the related Mortgaged Property or Properties. In addition, the Market Value for
any Purchased Loan may be deemed by Buyer to be zero or such greater amount (in
the Applicable Standard of Discretion) in the event any of the following occurs
with respect to such Purchased Loan: (a) a negative change in Market Value to
the extent resulting from a continuing material breach of a representation or
warranty set forth on Exhibit VI- I, Exhibit VI-II or Exhibit VI-III, as
applicable (but without giving effect to any qualifications for Seller’s Actual
Knowledge); or (b) the Repurchase Date with respect to such Purchased Loan
occurs without repurchase of such Purchased Loan. For the avoidance of doubt,
the Market Value of any Purchased Loan shall be denominated in the same
Applicable Currency as the Purchase Price of such Purchased Loan and, if
determined in a currency other than such Applicable Currency, shall be converted
to such Applicable Currency for the purposes herein based on the applicable
Purchase Date Spot Rate with respect to such Purchased Loan.

“Material Adverse Effect” shall mean a material adverse effect on (a) the
business, condition (financial or otherwise) or results of operations of Seller
and Guarantor, taken as a whole, (b) the ability of Seller or Guarantor to pay
and perform its material obligations under any of the Transaction Documents,
(c) the legality, validity or enforceability of any of the Transaction
Documents, (d) the rights and remedies of Buyer under any of the Transaction
Documents, or (e) the perfection or priority of any Lien granted under any
Purchased Loan Document.

“Maximum LTV (Purchase Price)” shall mean, with respect to any Purchased Loan,
the ratio, expressed as a percentage, the numerator of which shall equal the
Maximum Purchase Price of the Purchased Loan and the denominator of which shall
equal the “as is” value of the related Mortgaged Property securing such
Purchased Loan as determined by Buyer in its commercially reasonable discretion
and, in each case, calculated using the Applicable Currency relevant to such
Purchased Loan.

 

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“Maximum Purchase Price” shall have the meaning set forth in the Fee Agreement.

“Maximum Purchase Price Percentage” shall have the meaning set forth in the Fee
Agreement.

“Mortgage” shall mean: (x) with respect to U.S. Purchased Loans, a mortgage,
deed of trust, deed to secure debt or other instrument, creating a valid and
enforceable first lien on or a first priority ownership interest in an estate in
fee simple in real property and the improvements thereon, or a leasehold
interest therein, securing a mortgage note or similar evidence of indebtedness,
and (y) with respect to Foreign Purchased Loans, the related mortgage, debenture
or equivalent security deed or other instrument creating a first priority lien,
first priority mortgage or a first priority security interest in an estate in
fee simple in real property and the improvements thereon, or in a freehold or
crown leasehold interest therein, securing a mortgage note or similar evidence
of indebtedness and any other security deed or other instrument or securing
indebtedness under a loan or facility agreement (and any related finance
documentation), in each case securing indebtedness under applicable Requirements
of Law in the relevant non-U.S. jurisdiction.

“Mortgage Note” shall mean: (x) with respect to U.S. Purchased Loans, a note or
other evidence of indebtedness of a Mortgagor secured by a Mortgage in
connection with such U.S. Purchased Loan, and (y) with respect to Foreign
Purchased Loans, any evidence of indebtedness of a Mortgagor that is secured by
a Mortgage in connection with such Foreign Purchased Loan (including, without
limitation, the applicable facility or loan agreement).

“Mortgaged Property” shall mean the real property securing repayment of the debt
evidenced by (x) with respect to U.S. Purchased Loans, a Mortgage Note, and
(y) with respect to Foreign Purchased Loans, a Mortgage.

“Mortgagee” shall mean the record holder or registered holder (as applicable) of
(x) with respect to U.S. Purchased Loans, a Mortgage Note secured by a Mortgage,
and (y) with respect to Foreign Purchased Loans, a Mortgage.

“Mortgagor” shall mean the obligor (x) with respect to U.S. Purchased Loans, on
a Mortgage Note and the grantor of the related Mortgage, and (y) with respect to
Foreign Purchased Loans, that is expressed in the loan agreement for the
relevant Foreign Purchased Loan to be the legal or beneficial owner of the
relevant Mortgaged Property and which is the grantor of the related Mortgage.

“MTM Representations” shall mean the representations and warranties set forth as
items (a) 11, 12, 14, 25, 35, 36, 37, 42, 47, 50 and 55 on Exhibit VI-I of this
Agreement, (b) 3, 7, 9, 16 and 20 on Exhibit VI-II of this Agreement and (c) 8,
9, 18, 19, 20, 21, 24 and 30 on Exhibit VI-III of this Agreement.

 

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“Multiemployer Plan” shall mean a multiemployer plan defined as such in
Section 3(37) of ERISA to which contributions have been, or were required to
have been, made by Seller or any ERISA Affiliate during the preceding five plan
years and which is subject to Title IV of ERISA.

“OFAC” shall mean the U.S. Department of Treasury, Office of Foreign Assets
Control

“OFAC List” shall mean the Specially Designated Nationals list maintained by
OFAC.

“Omnibus Amendment” shall mean that certain Omnibus Amendment to Other
Transaction Documents and Reaffirmation of Guaranty dated as of the First
Amendment and Restatement Date, by and among Seller, Guarantor and Buyer.

“Original Agreement” shall have the meaning set forth in Section 1 of this
Agreement.

“Other Connection Taxes” shall mean Taxes imposed as a result of a present or
former connection between Buyer and the jurisdiction imposing such Taxes (other
than a connection arising solely as a result of Buyer having executed,
delivered, become a party to, performed its obligations under, received payments
under, received or perfected a security interest under or enforced any
Transaction Document, or sold or assigned an interest in any Transaction or
Transaction Document).

“Other Taxes” shall mean all present or future stamp, court or documentary,
intangible, recording, filing or similar Taxes (including, without limitation,
United Kingdom stamp duty and stamp duty reserve tax) that arise from the
execution, delivery, performance, enforcement or registration of, from the
receipt or perfection of a security interest under any Transaction Document;
provided, however, that Other Taxes shall not include (i) Taxes imposed with
respect to an assignment, transfer or sale of participation or other interest in
or with respect to the Transaction Documents or (ii) any Excluded Taxes.

“Parlex 2” shall have the meaning set forth in the preamble of this Agreement.

“Parlex 2A” shall have the meaning set forth in the preamble of this Agreement.

“Parlex 2 AU” shall have the meaning set forth in the preamble of this
Agreement.

“Parlex 2 EUR” shall have the meaning set forth in the preamble of this
Agreement.

“Parlex 2 UK” shall have the meaning set forth in the preamble of this
Agreement.

“Participant Register” shall have the meaning specified in Section 19(d).

“Participating Member State” shall mean any member state of the European Union
that has the Euro as its lawful currency in accordance with legislation of the
European Union relating to Economic and Monetary Union.

“Participation Interests” shall have the meaning assigned to such term in
Exhibit VI-II.

 

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“Permitted Encumbrances” shall have the meaning specified in Exhibit VI-I.

“Permitted Liens” shall mean any of the following as to which no enforcement,
collection, execution, levy or foreclosure proceeding has been commenced:
(a) Liens for Taxes not yet due and payable or which are being contested in good
faith and for which adequate reserves have been established in accordance with
GAAP, (b) Liens imposed by Requirements of Law, such as materialmen’s,
mechanics’, carriers’, workmen’s, repairmen’s and similar Liens, arising in the
ordinary course of business securing obligations that are not overdue for more
than thirty (30) days, (c) Liens securing the unpaid balance of purchase money
for property acquired in the ordinary course of business under an instalment
contract on the supplier’s standard terms where such unpaid balance is not yet
due, and (d) Liens granted pursuant to or by the Transaction Documents.

“Permitted Purchased Loan Modification” shall mean any modification or amendment
of a Purchased Loan which is not a Significant Purchased Loan Modification.

“Person” shall mean an individual, corporation, limited liability company,
business trust, partnership, joint tenant or tenant-in-common, trust,
unincorporated organization, or other entity, or a federal, state or local
government or any agency or political subdivision thereof.

“PEXA” shall mean the electronic registration platform known as Property
Exchange Australia.

“Plan” shall mean an employee benefit or other plan established or maintained by
Seller or any ERISA Affiliate during the five year period ended prior to the
date of this Agreement or to which Seller or any ERISA Affiliate makes, is
obligated to make or has, within the five year period ended prior to the date of
this Agreement, been required to make contributions and that is covered by Title
IV of ERISA or Section 302 of ERISA or Section 412 of the Code, other than a
Multiemployer Plan.

“Plan Party” shall have the meaning specified in Section 22(a) of this
Agreement.

“Pounds Sterling” and “£” shall mean the lawful currency for the time being of
the United Kingdom.

“PPSA” shall mean the Personal Property Securities Act (2009) Cth.

“PPS Register” shall mean the Personal Property Securities Register established
under section 147 of the PPSA.

“Price Differential” shall mean, with respect to any Transaction as of any date,
the aggregate amount obtained by daily application of the Pricing Rate for such
Transaction to the outstanding Purchase Price for such Transaction on a
360-day-per- year basis (or, in the case of Foreign Purchased Loans (AU) only, a
365-day-per-year basis) for the actual number of days during the period
commencing on (and including) the Purchase Date for such Transaction and ending
on (but excluding) the date of determination (reduced by any amount of such
Price Differential previously paid by Seller to Buyer with respect to such
Transaction). Price Differential shall be payable in the Applicable Currency of
the Purchase Price of the applicable Purchased Loan.

 

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“Pricing Matrix” shall mean the matrix attached to the Fee Agreement which shall
be used to determine the Purchase Price Percentage, Maximum Purchase Price
Percentage and the Applicable Spread for each Purchased Loan.

“Pricing Rate” shall mean, for any Pricing Rate Period, an annual rate equal to
the Index Rate for such Pricing Rate Period (as specified in the related
Confirmation) plus the Applicable Spread for such Transaction plus the Spread
Adjustment for such Transaction and shall be subject to adjustment and/or
conversion as provided in Sections 3(g) and 3(h) of this Agreement.

“Pricing Rate Determination Date” shall mean with respect to any Pricing Rate
Period with respect to any Transaction, the second (2nd) Business Day preceding
the first day of such Pricing Rate Period (or, in the case of a Foreign
Purchased Loan (AU) only, the first day of such Pricing Rate Period).

“Pricing Rate Period” shall mean, (a) in the case of the first Pricing Rate
Period with respect to any Transaction, the period commencing on and including
the Purchase Date for such Transaction and ending on and excluding the following
Remittance Date, and (b) in the case of any subsequent Pricing Rate Period, the
period commencing on and including such Remittance Date and ending on and
excluding the following Remittance Date; provided, however, that in no event
shall any Pricing Rate Period end subsequent to the Repurchase Date.

“Prime Rate” shall mean the prime rate of U.S. commercial banks as published in
The Wall Street Journal (or, if more than one such rate is published, the
average of such rates).

“Principal Payment” shall mean, with respect to any Purchased Loan, any payment
or prepayment of principal received by the Depository in respect thereof.

“Prohibited Person” shall mean any (1) person or entity who is on the OFAC List
or any Foreign Sanctions List; a “designated national,” “specially designated
national,” “specially designated terrorist,” “specially designated global
terrorist,” “foreign terrorist organization,” or “blocked person” within the
definitions set forth in the Foreign Assets Control Regulations of the United
States Treasury Department, 31 C.F.R., Subtitle B, Chapter V, as amended,
(2) person acting on behalf of, or an entity owned or controlled by, any
government against whom the United States maintains economic sanctions or
embargoes under the Regulations of the United States Treasury Department, 31
C.F.R., Subtitle B, Chapter V, as amended, including, but not limited to, the
“Government of Sudan,” the “Government of Iran,” and the “Government of Cuba,”
and any person or organization determined by the Director of the Office of
Foreign Assets Control to be included within 31 C.F.R. Section 575.306
(definition of “Government of Iraq”), (3) person or entity who is listed in the
Annex to or is otherwise within the scope of Executive Order 13224 – Blocking
Property and Prohibiting Transactions with Person who Commit, Threaten to
Commit, or Support Terrorism, effective September 24, 2001, or (4) person or
entity subject to additional restrictions imposed by the following statutes or
Regulations and Executive Orders issued thereunder: the Trading with the Enemy
Act, 50 U.S.C. app. §§ 1 et seq., the Iraq Sanctions Act, Pub. L. 101-513, Title
V, §§ 586 to 586J, 104 Stat. 2047, the

 

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National Emergencies Act, 50 U.S.C. §§ 1601 et seq., the Anti-Terrorism and
Effective Death Penalty Act of 1996, Pub. L. 104-132, 110 Stat. 1214-1319, the
International Emergency Economic Powers Act, 50 U.S.C. §§ 1701 et seq., the
United Nations Participation Act, 22 U.S.C. § 287c, the International Security
and Development Cooperation Act, 22 U.S.C. § 2349aa-9, the Nuclear Proliferation
Prevention Act of 1994, Pub. L. 103-236, 108 Stat. 507, the Foreign Narcotics
Kingpin Designation Act, 21 U.S.C. §§ 1901 et seq., the Iran and Libya Sanctions
Act of 1996, Pub. L. 104-172, 110 Stat. 1541, the Cuban Democracy Act, 22 U.S.C.
§§ 6001 et seq., the Cuban Liberty and Democratic Solidarity Act, 22 U.S.C. §§
6201-91, the Foreign Operations, Export Financing and Related Programs
Appropriations Act, 1997, Pub. L. 104-208, 110 Stat. 3009-172, the Uniting and
Strengthening America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism Act of 2001, Pub. L. 107-56, 115 Stat. 272, or any other law
of similar import as to any non-U.S. country, as each such Act or law has been
or may be amended, adjusted, modified, or reviewed from time to time.

“Prohibited Transferee” shall mean any of the Persons listed on Schedule I
attached to this Agreement.

“Property” shall mean any right or interest in or to property of any kind
whatsoever, whether real, personal or mixed and whether tangible or intangible.

“Property Report” shall mean, with respect to a Foreign Purchased Loan, an
original, duplicate or counterpart certificate, report or document of title in
relation to the related Mortgaged Property (including, if applicable, a
certificate of units in a unit trust or share certificate) that is delivered as
a condition precedent to the making of the related Foreign Purchased Loan under
the loan agreement for such Foreign Purchased Loan.

“Purchase Date” shall mean any date on which a Purchased Loan is to be
transferred by Seller to Buyer.

“Purchase Date Spot Rate (AU)” shall mean with respect to any Purchased Loan
which is not a Foreign Purchased Loan (AU), the Spot Rate for converting the
Applicable Currency of such Purchased Loan to AU Dollars on the related Purchase
Date (which shall be set forth in the applicable Confirmation).

“Purchase Date Spot Rate (EUR)” shall mean with respect to any Purchased Loan
which is not a Foreign Purchased Loan (EUR), the Spot Rate for converting the
Applicable Currency of such Purchased Loan to Euro on the related Purchase Date
(which shall be set forth in the applicable Confirmation).

“Purchase Date Spot Rate (GBP)” shall mean with respect to any Purchased Loan
which is not a Foreign Purchased Loan (GBP), the Spot Rate for converting the
Applicable Currency of such Purchased Loan to Pounds Sterling on the related
Purchase Date (which shall be set forth in the applicable Confirmation).

“Purchase Date Spot Rate (U.S. Dollars)” shall mean with respect to any
Purchased Loan which is not a U.S. Purchased Loan, the Spot Rate for converting
the Applicable Currency of such Purchased Loan to U.S. Dollars on the related
Purchase Date (which shall be set forth in the applicable Confirmation).

 

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“Purchase Date Spot Rate” shall mean the Purchase Date Spot Date (AU), Purchase
Date Spot Date (EUR), the Purchase Date Spot Rate (GBP) or the Purchase Date
Spot Rate (U.S. Dollars), as applicable.

“Purchase Price” shall mean, with respect to any Purchased Loan, the price at
which such Purchased Loan is transferred by Seller to Buyer on the applicable
Purchase Date (paid in the same Applicable Currency as the related Whole Loan or
Senior Interest (or participation interest therein) and stated on the related
Confirmation), as adjusted after the Purchase Date, all as set forth below and
not to exceed the Maximum Purchase Price. The Purchase Price as of the Purchase
Date for any Purchased Loan shall be the amount set forth on the applicable
Confirmation (expressed in the same Applicable Currency as the related Whole
Loan or Senior Interest (or participation interest therein)) equal to the lesser
of (a) the product obtained by multiplying (i) the lesser of the Market Value of
such Purchased Loan and the par amount of such Purchased Loan by (ii) the
applicable Purchase Price Percentage and (b) the amount that causes the LTV
(Purchase Price) to equal 60.00%. The Purchase Price of any Purchased Loan shall
thereafter only be modified to be (a) increased by any Margin Excess transferred
by Buyer to Seller pursuant to Section 4(c) or 4(e) of this Agreement, not to
exceed the Maximum Purchase Price, and (b) reduced by any amount applied to
reduce such Purchase Price pursuant to Section 3(f), 4(a) or 5 of this Agreement
(or, in the case of Principal Payments made in respect of such Purchased Loan,
remitted to the applicable Cash Management Account for application to reduce
such Purchase Price pursuant to Section 5(e)).

“Purchase Price Percentage” shall mean, with respect to each Purchased Loan, the
amount, expressed as a percentage, determined by dividing (i) the outstanding
Purchase Price of such Purchased Loan as of any date of determination hereunder
by (ii) the Market Value of such Purchased Loan as of such date, not to exceed
the Maximum Purchase Price Percentage.

“Purchased Loan” shall mean a Foreign Purchased Loan or a U.S. Purchased Loan,
as applicable.

“Purchased Loan Documents” shall mean, with respect to a Purchased Loan, the
documents comprising the Purchased Loan File for such Purchased Loan.

“Purchased Loan File” shall mean the documents specified as the “Purchased Loan
File” in Section 7(b), together with any additional documents and information
required to be delivered to Buyer or its designee (including the Custodian)
pursuant to this Agreement.

“Purchased Loan Schedule” shall mean a schedule of Purchased Loans attached to
each Trust Receipt and Custodial Delivery, which may but is not required to,
contain information substantially similar to the Collateral Tape.

“Recast Insolvency Regulation” shall have the meaning specified in
Section 10(b)(xxii).

 

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“Reference Banks” shall mean any four major reference banks in the London
interbank market selected by Buyer.

“Register” shall have the meaning specified in Section 19(c).

“REMIC ” shall mean a real estate mortgage investment conduit, within the
meaning of Section 860D(a) of the Code.

“Remittance Date” shall mean: (a) with respect to U.S. Purchased Loans, the
seventeenth (17th) calendar day of each month, or the next succeeding Business
Day, if such calendar day shall not be a Business Day; (b) with respect to
Foreign Purchased Loans (AU), either (i) solely to the extent the related
Purchased Loan Documents require monthly (as opposed to quarterly) interest
payments by the relevant Mortgagor, the twelfth (12th) calendar day of each
month, or the next succeeding Business Day, if such calendar day shall not be a
Business Day or (ii) solely to the extent the related Purchased Loan Documents
require quarterly (as opposed to monthly) interest payments by the relevant
Mortgagor, January 12, April 12, July 12 and October 12, or the next succeeding
Business Day, if such calendar day shall not be a Business Day; provided that,
notwithstanding the foregoing, in the event that the Due Date (Foreign Purchased
Loan (AU)) applicable to such Foreign Purchased Loan (AU) in any month occurs
less than three (3) Business Days prior to the applicable date specified in
either of the foregoing clause (b)(i) or (ii), then the Remittance Date for such
Foreign Purchased Loan (AU) shall be the date which is three (3) Business Days
after such Due Date (Foreign Purchased Loan (AU)); and (c) with respect to all
other Foreign Purchased Loans, January 25, April 25, July 25 and October 25, or
the next succeeding Business Day, if such calendar day shall not be a Business
Day, or, in each case, such other day as is mutually agreed to by Seller and
Buyer.

“Repurchase Date” shall mean, with respect to each Purchased Loan, the earliest
of: (x) the Facility Expiration Date or (y) the maturity date of such Purchased
Loan (subject to extension, if applicable, in accordance with its Purchased Loan
Documents) or (z) the related Early Repurchase Date.

“Repurchase Obligations” shall mean all obligations of Seller to pay the
Repurchase Price on the Repurchase Date and all other obligations and
liabilities of Seller to Buyer arising under or in connection with the
Transaction Documents, whether now existing or hereafter arising.

“Repurchase Price” shall mean, with respect to any Purchased Loan as of any
date, the price at which such Purchased Loan is to be transferred from Buyer to
Seller upon termination of the related Transaction (which price shall be
expressed and payable in the Applicable Currency stated on the Confirmation for
such Purchased Loan); such price will be determined in each case as the sum of
(a) the outstanding Purchase Price of such Purchased Loan, (b) the accrued but
unpaid Price Differential thereon with respect to such Purchased Loan as of such
date, (c) all other amounts due and payable as of such date by Seller to Buyer
under this Agreement or any Transaction Document with respect to such Purchased
Loan (including, but not limited to, accrued and unpaid fees, expenses and
indemnity amounts) and (d) any costs incurred in connection with terminating any
related Hedging Transactions entered into with Buyer or an Affiliate of Buyer.

 

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“Request for Margin Excess” shall mean a request for Margin Excess, in the form
of Exhibit IX attached hereto.

“Requirement of Law” shall mean any law, treaty, rule, regulation, code,
directive, policy, order or requirement or determination of an arbitrator or a
court or other Governmental Authority whether now or hereafter enacted or in
effect.

“Required Filing” shall mean, with respect to any Foreign Purchased Loan, to the
extent applicable, (w) registration of particulars of the related Mortgage at
the Companies Registration Office under the Companies Act 2006 and payment of
associated fees, (x) registration of the related Mortgage at the Land Registry
or Land Charges Registry in England and Wales and payment of associated fees,
(y) registration of the related Mortgage at the land registry, land titles
office or similar Governmental Authority (including, where applicable, through
PEXA) in the relevant State or Territory of the Commonwealth of Australia in
which the related Mortgaged Property is situated, and (z) registration of the
related Mortgage with any analogous Governmental Authority in the applicable
non-U.S. jurisdiction in which the Mortgaged Property securing the related
Mortgage is located.

“Reserve Requirement” shall mean, with respect to any Pricing Rate Period, the
aggregate (without duplication) of the rates (expressed as a decimal fraction)
of reserve requirements in effect during such Pricing Rate Period (including,
without limitation, basic, supplemental, marginal and emergency reserves under
any regulations of the Board of Governors of the Federal Reserve System or other
Governmental Authority having jurisdiction with respect thereto) dealing with
reserve requirements prescribed for eurocurrency funding (currently referred to
as “Eurocurrency Liabilities” in Regulation D of such Board of Governors)
maintained by Buyer.

“RICS” shall mean the then-current Statements of Asset Valuation Practice and
Guidance Notes issued by the Royal Institution of Chartered Surveyors.

“SEC” shall have the meaning specified in Exhibit VI-I.

“Second Amendment and Restatement Date” shall have the meaning specified in
Section 1 of this Agreement.

“Security Agent” shall mean, with respect to a Foreign Purchased Loan that is in
syndicated form, a security agent or a security trustee appointed by the lenders
under such Foreign Purchased Loan to hold the benefit of any security agreements
relating to such Foreign Purchased Loan on their behalf.

“Seller” shall mean, collectively, Parlex 2, Parlex 2A, Parlex 2 UK, Parlex 2
EUR, Parlex 2 AU and each other Person as and when same may be approved by Buyer
in its sole discretion from time to time and admitted to this Agreement as a
Seller by a joinder agreement executed and delivered by Buyer, Seller and such
approved other Seller in the form of Exhibit XI to this Agreement (a “Joinder
Agreement”).

 

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“Senior Interests” shall have the meaning given to such term in the definition
of “Eligible Loans”.

“Servicer” shall mean: (x) Midland Loan Services, a division of PNC Bank,
National Association or (y) any other third party servicer selected by Seller
and approved by Buyer in its sole discretion; provided, that notwithstanding the
foregoing, such other third party servicer selected by Seller shall be approved
by Buyer in its reasonable discretion, so long as such Person’s primary servicer
rating shall be at least “above average” by Standard & Poor’s Ratings Service.

“Servicing Agreement” shall mean, individually or collectively, as the context
may require (a) other than with respect to each CLO Participation A-1 issued
pursuant to a CLO Participation Agreement, (i) that certain Servicing Agreement,
dated as of June 12, 2013, among Parlex 2, Buyer and Servicer, as the same may
be amended, modified and/or restated from time to time, (ii) that certain
Servicing Agreement, dated as of January 31, 2014, among Parlex 2A, Buyer, and
Servicer, as the same may be amended, modified and/or restated from time to
time, (iii) that certain Servicing Agreement, dated as of the Second Amendment
and Restatement Date, among Parlex 2 UK, Buyer, and Servicer, as the same may be
amended, modified and/or restated from time to time, (iv) that certain Servicing
Agreement, dated as of the Second Amendment and Restatement Date, among Parlex 2
EUR, Buyer, and Servicer, as the same may be amended, modified and/or restated
from time to time, (v) that certain Servicing Agreement, dated as of the Third
Amendment and Restatement Date, among Parlex 2 AU, Buyer, and Servicer, as the
same may be amended, modified and/or restated from time to time, and (vi) any
other servicing agreement entered into by a Seller, Buyer and any Servicer
approved by Buyer for the servicing of Purchased Loans, as the same may be
amended, modified and/or restated from time to time and (b) with respect to each
CLO Participation A-1 issued pursuant to a CLO Participation Agreement, (x) for
so long as the corresponding CLO Participation A-2 is an asset of the CLO, the
CLO Servicing Agreement and (y) at any time such corresponding CLO Participation
A-2 is not an asset of the CLO, the servicing agreement entered into in
accordance with the applicable CLO Participation Agreement.

“Servicing Records” shall have the meaning specified in Section 29(b).

“Servicing Rights” shall mean Seller’s right, title and interest in and to any
and all of the following: (a) any and all rights to service the related
Purchased Loan; (b) any payments to or monies received by such Seller or any
other Person as a fee for servicing such Purchased Loan; (c) any late fees,
penalties or similar payments with respect to such Purchased Loan; (d) all
agreements or documents creating, defining or evidencing any such servicing
rights to the extent they relate to such servicing rights and all rights of such
Seller or any other Person thereunder; (e) escrow payments or other similar
payments with respect to such Purchased Loan and any amounts actually collected
by such Seller or any other Person with respect thereto; (f) the right, if any,
to appoint a special servicer or liquidator of such Purchased Loan; and (g) all
accounts and other rights to payment related to the servicing of such Purchased
Loan.

“Similar Loan” shall have the meaning specified in Section 3(g) of this
Agreement.

 

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“Significant Purchased Loan Modification” means any modification or amendment of
a Purchased Loan which

(i) reduces the principal amount of the Purchased Loan in question other than
(1) with respect to a dollar-for-dollar principal payment or (2) reductions of
principal to the extent of deferred, accrued or capitalized interest added to
principal which additional amount subsequently reduced was not taken into
account by Buyer in determining the related Purchase Price,

(ii) increases the principal amount of a Purchased Loan other than (a) increases
which are derived from accrual or capitalization of deferred interest which is
added to principal or protective advances or (b) increases resulting from future
fundings made pursuant to the Purchased Loan Documents,

(iii) modifies the amount or timing of any regularly scheduled payments of
principal and non-contingent interest of the Purchased Loan in question,
provided, however, that Seller may, without the consent of Buyer change the
scheduled payment date of a Purchased Loan within any given calendar month,

(iv) changes the frequency of scheduled payments of principal and interest in
respect of a Purchased Loan,

(v) subordinates the lien priority of the Purchased Loan in question or the
payment priority of the Purchased Loan in question other than subordinations
required under the then existing terms and conditions of the Purchased Loan in
question (provided, however, the foregoing shall not preclude the execution and
delivery of subordination, nondisturbance and attornment agreements with
tenants, subordination to tenant leases, easements, plats of subdivision and
condominium declarations, conditions, covenants and restrictions and similar
instruments which in the commercially reasonable judgment of Seller do not
materially adversely affect the rights and interest of the holder of the
Purchased Loan in question),

(vi) releases any collateral for the Purchased Loan in question other than
releases required under the then existing Purchased Loan documents or releases
in connection with eminent domain or under threat of eminent domain,

(vii) waives, amends or modifies any cash management or reserve account
requirements of the Purchased Loan other than changes required under the then
existing Purchased Loan documentation,

(viii) waives any due-on-sale or due-on-encumbrance provisions of the Purchased
Loan in question other than waivers required to be given under the then existing
Purchased Loan documents, or

(ix) waives, amends or modifies the underlying insurance requirements of the
Purchased Loan;

 

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provided, however, that this definition of “Significant Purchased Loan
Modification” shall not include any modification or amendment to any Purchased
Loan Document solely in connection with the reallocation of a portion of the
principal balance of any CLO Participation A-1 to the corresponding CLO
Participation A-2 pursuant to Section 29(b) of the applicable CLO Participation
Agreement in order to implement a replenishment pursuant to Section 12.2 of the
CLO Indenture, so long as such reallocation is implemented in connection with an
early repurchase consummated in accordance with Section 3(d) of this Agreement.

“Single Purpose Entity” shall have the meaning specified in Exhibit VI-I.

“SIPA” shall have the meaning specified in Section 24(a) of this Agreement.

“Solvent” shall mean with respect to any Person at any time, having a state of
affairs such that all of the following conditions are met at such time: (a) the
fair value of the assets and property of such Person is greater than the amount
of such Person’s liabilities (including disputed, contingent and unliquidated
liabilities) as such value is established and liabilities evaluated for purposes
of Section 101(32) of the Bankruptcy Code, (b) the present fair salable value of
the assets and property of such Person in an orderly liquidation of such Person
is not less than the amount that will be required to pay the probable liability
of such Person on its debts as they become absolute and matured, (c) such Person
does not intend to, and does not believe that it will, incur debts or
liabilities beyond such Person’s ability to pay as such debts and liabilities
mature, and (d) such Person is not engaged in a business or a transaction, and
is not about to engage in a business or a transaction, for which such Person’s
assets and property would constitute unreasonably small capital.

“Special Purpose Entity” shall mean a Person, other than an individual, which is
formed or organized solely for the purpose of holding, directly and subject to
this Agreement, the Purchased Loans and otherwise complies with the requirements
of Section 13.

“Spot Rate” shall mean, with respect to an Applicable Currency, as of any date
of determination, the rate quoted as the spot rate for the purchase of such
Applicable Currency with another Applicable Currency at or about 11:00 a.m.,
London time (in the case of each Foreign Purchased Loan (EUR) and Foreign
Purchased Loan (GBP)) or Sydney time (in the case of each Foreign Purchased Loan
(AU)), on the date that is two (2) Business Days prior to the date as of which
the foreign exchange computation is made as obtained from the applicable screen
on Bloomberg.

“Spread Adjustment” shall have the meaning specified in the Fee Agreement.

“Standard Qualifications” shall have the meaning specified in Exhibit VI-I.

“Survey” shall mean: (x) with respect to U.S. Purchased Loans, a certified
ALTA/ACSM (or applicable state standards for the state in which the Mortgaged
Property is located) survey of a Mortgaged Property prepared by a registered
independent surveyor or engineer, and (y) with respect to Foreign Purchased
Loans (other than Foreign Purchased Loans (AU)), a valuation of such Mortgaged
Property by a valuer prepared on the basis of the market value as that term is

 

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defined in the then current Statements of Asset Valuation Practice and Guidance
Notes issued by the Royal Institution of Chartered Surveyors or its equivalent
in any applicable jurisdiction, in each case, in form and content satisfactory
to Buyer in its commercially reasonable discretion and, in the case of the
foregoing clause (x), in form and content satisfactory to the company issuing
the Title Policy for such Mortgaged Property.

“Taxes” shall mean all present or future Taxes, levies, imposts, duties,
deductions, withholdings (including backup withholding), assessments, fees or
other charges imposed by any Governmental Authority, including any interest,
additions to tax or penalties applicable thereto and including any stamp duty,
transfer taxes and any value added or goods or services tax.

“Terrorism Cap Amount” shall have the meaning specified in Exhibit VI-I.

“Third Amendment and Restatement Date” shall mean October 12, 2018.

“Title Policy” shall have the meaning specified in Exhibit VI-I.

“Transaction” shall have the meaning set forth in Section 1.

“Transaction Conditions Precedent” shall have the meaning specified in
Section 3(b) of this Agreement.

“Transaction Documents” shall mean, collectively, this Agreement, any applicable
Annexes to this Agreement, the Guaranty, any Custodial Agreement, any Blocked
Account Agreement, any Servicing Agreement, any Joinder Agreement, the Omnibus
Amendment, all Confirmations executed pursuant to this Agreement or the Original
Agreement in connection with specific Transactions, any other documents or
instruments relating to any such documents executed by Seller or Guarantor, and
any written modifications, extensions, renewals, restatements, or replacements
of any of the foregoing.

“Transaction Request ” shall mean a request to enter into a Transaction, in the
form of Exhibit VIII attached hereto.

“Transfer Certificate” shall mean, with respect to a Foreign Purchased Loan, any
form of transfer or substitution certificate or assignment agreement that is
scheduled to the related loan agreement or other equivalent agreement for such
Foreign Purchased Loan and that is used to effect the legal transfer or
assignment of such Foreign Purchased Loan and (if applicable) any accession or
substitution certificate, if any, required for the Buyer to become a beneficiary
of the security trust in respect of such Foreign Purchased Loan.

“Treasury Regulations” shall have the meaning specified in Section 19(d) of this
Agreement.

“TRIA” shall have the meaning specified in Exhibit VI-I.

“Trust Receipt” shall mean a trust receipt issued by Custodian to Buyer
confirming the Custodian’s possession of certain Purchased Loan Files which are
the property of and held by Custodian for the benefit of Buyer (or any other
holder of such trust receipt) or a bailment arrangement with an Acceptable
Attorney.

 

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“UCC” shall have the meaning specified in Section 6 of this Agreement.

“U.S. Dollars” and “$” shall mean the lawful currency of the United States of
America.

“U.S. Person” shall mean a “United States person” as defined in
Section 7701(a)(30) of the Code.

“U.S. Purchased Loan” shall mean: (i) with respect to any Transaction, an
Eligible Loan secured by Mortgaged Property located in the United States of
America or any territory thereof and which is sold by the applicable Seller to
Buyer in such Transaction and (ii) with respect to the Transactions for U.S.
Purchased Loans in general, all Eligible Loans secured by Mortgaged Property
located in the United States of America or any territory thereof and which are
sold by the applicable Sellers to Buyer.

“Whole Loans” shall have the meaning given to such term in the definition of
“Eligible Loans”.

“Zoning Regulations” shall have the meaning specified in Exhibit VI-I.

 

3.

INITIATION; CONFIRMATION; TERMINATION; FEES

(a) Subject to the terms and conditions set forth in this Agreement (including,
without limitation, (x) the “Transaction Conditions Precedent” specified in
Section 3(b) of this Agreement and (y) Section 4(h) of this Agreement), an
agreement to enter into a Transaction shall be made, from time to time, in
writing at the initiation of Seller as provided below; provided, however, that
(i) the aggregate outstanding Purchase Price at any time for all Purchased Loans
shall not exceed the Facility Amount, and (ii) Buyer shall not have any
obligation to enter into new Transactions with Seller after the occurrence and
during the continuance of a monetary or material non-monetary Default or an
Event of Default or after the Facility Availability Period. Seller may, from
time to time, submit to Buyer a Transaction Request, in the form of Exhibit VIII
attached hereto, for Buyer’s review and approval in order to enter into a
Transaction with respect to any Eligible Loan that Seller proposes to be
included as Collateral under this Agreement. Upon Buyer’s receipt of a complete
Due Diligence Package, Buyer shall have the right to request, in Buyer’s good
faith business judgment and in a manner consistent with Buyer’s other master
repurchase facilities for comparable assets, additional diligence materials and
deliveries with respect to the applicable Eligible Loan, to the extent necessary
for Buyer’s underwriting of such Eligible Loan. Upon Buyer’s receipt of the
Transaction Request, Due Diligence Package and such additional diligence
materials, Buyer shall use commercially reasonable efforts to within five
(5) Business Days and following receipt of internal credit approval, either
(i) notify Seller of the Purchase Price and the Market Value for the Eligible
Loan or (ii) deny Seller’s request for a Transaction. Buyer’s failure to respond
to Seller within five (5) Business Days shall be deemed to be a denial of
Seller’s request for a Transaction, unless Buyer and Seller have agreed
otherwise in writing. Buyer shall have the right to review all Eligible Loans
proposed to be sold to Buyer in any Transaction and to conduct

 

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its own due diligence investigation of such Eligible Loans as Buyer reasonably
determines. Buyer shall be entitled to make a determination, in its sole
discretion, that it shall or shall not purchase any or all of the Eligible Loans
proposed to be sold to Buyer by Seller. On the Purchase Date for the Transaction
which shall be on a date mutually agreed upon by Buyer and Seller following the
approval of an Eligible Loan by Buyer, the Purchased Loan shall be transferred
to Buyer or its designee against the transfer of the Purchase Price (which
Purchase Price shall be funded in the Applicable Currency of the related Whole
Loan or Senior Interest (or participation interest therein) and stated on the
applicable Confirmation) to an account of Seller or as directed by Seller in
writing (and subject to the last sentence of Section 17).

(b) Upon agreeing to enter into a Transaction hereunder, provided each of the
Transaction Conditions Precedent shall have been satisfied (or waived by Buyer),
Buyer shall promptly deliver to Seller a written confirmation in the form of
Exhibit I attached hereto of each Transaction (a “Confirmation”). Such
Confirmation shall describe the Purchased Loan, shall identify Buyer and Seller,
and shall set forth:

 

  (i)

the Purchase Date,

 

  (ii)

the Purchase Price Percentage, Maximum Purchase Price Percentage, the initial
Purchase Price and the Maximum Purchase Price for such Purchased Loan (which
initial Purchase Price and the Maximum Purchase Price shall be expressed and
payable in the same Applicable Currency as the related Purchased Loan),

 

  (iii)

the Repurchase Date,

 

  (iv)

the Pricing Rate (including the Applicable Spread),

 

  (v)

the Margin Percentage,

 

  (vi)

the LTV (Purchase Price) and Maximum LTV (Purchase Price),

 

  (vii)

the LTV (Loan UPB) and LTV (Aggregate Loan UPB) (if applicable),

 

  (viii)

the Funding Fee, any additional conditions precedent to the availability of
Margin Excess (Future Funding) and the type of funding (i.e. table
funded/non-table funded),

 

  (ix)

the Applicable Currency (which shall be the same Applicable Currency as the
related Purchased Loan),

 

  (x)

the applicable Purchase Date Spot Rates, and

 

  (xi)

any additional reasonable terms or conditions not inconsistent with this
Agreement and mutually agreed upon by Buyer and Seller.

 

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With respect to any Transaction, the Pricing Rate shall be determined initially
on the Pricing Rate Determination Date applicable to the first Pricing Rate
Period for such Transaction, and shall be reset on each subsequent Pricing Rate
Determination Date for the next succeeding Pricing Rate Period for such
Transaction. Buyer or its agent shall determine in accordance with the terms of
this Agreement the Pricing Rate on each Pricing Rate Determination Date for the
related Pricing Rate Period and notify Seller of such rate for such period on
such subsequent Pricing Rate Determination Date. For purposes of this
Section 3(b), the “Transaction Conditions Precedent” shall be deemed to have
been satisfied with respect to any proposed Transaction if:

 

  (A)

no monetary or material non-monetary Default or Event of Default under this
Agreement shall have occurred and be continuing as of the Purchase Date for such
proposed Transaction;

 

  (B)

subject to any exceptions reasonably approved by Buyer, the representations and
warranties made by Seller in any of the Transaction Documents shall be true and
correct in all material respects as of the Purchase Date for such Transaction,
before and after giving effect to such Transaction, as though made on such
Purchase Date (except to the extent such representations and warranties are made
as of a particular date);

 

  (C)

Buyer shall have received from Seller all corporate and governmental approvals,
legal opinions of counsel to Seller and Guarantor (including, without
limitation, as to authority, enforceability, perfection under the UCC and, with
respect to any Foreign Purchased Loan, the equivalent Requirements of Law under
the relevant non-U.S. jurisdiction, bankruptcy safe harbor and the Investment
Company Act of 1940) and closing documentation as Buyer may reasonably request
pursuant to this Agreement (including, with respect to any Foreign Purchased
Loan, a Foreign Assignment Agreement and such other closing documentation
necessary to transfer such Foreign Purchased Loan to Buyer and perfect the
security interest therein granted by Seller in favor of Buyer in the relevant
non-U.S. jurisdiction);

 

  (D)

Seller shall have paid to Buyer (x) the Funding Fee then due and payable with
respect to such Transaction pursuant to the Fee Agreement and (y) Buyer’s
out-of-pocket costs and expenses pursuant to Section 30(d) of this Agreement
(which amounts referred to in the preceding sub-clauses (D)(x) and (D)(y) may be
paid through a holdback to the Purchase Price);

 

  (E)

Buyer shall have (A) determined, in accordance with the applicable provisions of
Section 3(a) of this Agreement, that the Assets proposed to be sold to Buyer by
Seller in such Transaction are Eligible Loans and (B) obtained internal credit
approval for the inclusion of such Eligible Loan as a Purchased Loan in a
Transaction;

 

  (F)

Buyer shall have determined that no event has occurred which is reasonably
likely to result in a Material Adverse Effect; and

 

  (G)

as of the applicable Purchase Date, each of the applicable Concentration Limits
is satisfied (unless waived by Buyer).

 

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(c) Each Confirmation, together with this Agreement, shall be conclusive
evidence of the terms of the Transaction(s) covered thereby unless specific
objection is made in writing no less than three (3) Business Days after the date
thereof. In the event of any conflict between the terms of such Confirmation and
the terms of this Agreement, the Confirmation shall prevail. An objection sent
by Seller with respect to any Confirmation must state specifically that the
writing is an objection, must specify the provision(s) of such Confirmation
being objected to by Seller, must set forth such provision(s) in the manner that
Seller believes such provisions should be stated, and must be sent by Seller no
more than five (5) Business Days after such Confirmation is received by Seller.
It is understood and agreed that once a Confirmation has been executed by Buyer
and Seller, such Confirmation shall be binding on the parties hereto (absent
manifest error) and shall constitute evidence of Buyer’s approval of the
applicable Purchased Loan and the terms of the applicable Transaction.

(d) No Transaction shall be terminable on demand by Buyer (other than upon the
occurrence and during the continuance of an Event of Default). Seller shall be
entitled to terminate a Transaction on demand, in whole or in part (but in the
case of a termination in part, solely in connection with the reallocation of a
portion of the principal balance of any CLO Participation A-1 to the
corresponding CLO Participation A-2 pursuant to Section 29(b) of the applicable
CLO Participation Agreement in order to implement a replenishment pursuant to
Section 12.2 of the CLO Indenture), and repurchase the Purchased Loan subject to
a Transaction on any Business Day prior to the Repurchase Date (an “Early
Repurchase Date”); provided, however, that:

 

  (i)

Seller notifies Buyer in writing of its intent to terminate such Transaction and
repurchase such Purchased Loan no later than three (3) Business Days prior to
such Early Repurchase Date,

 

  (ii)

on such Early Repurchase Date Seller pays to Buyer an amount equal to the sum of
(x) the Repurchase Price for such Transaction, (y) the Exit Fee, if any, then
due and payable with respect to such Transaction pursuant to the Fee Agreement
(provided, however, that no Exit Fee shall be due and payable in connection with
a termination of a Transaction by Seller either (x) in part or (y) in whole in
connection with a severing of any CLO Participation A-1 into multiple
participations representing the funded portion of such CLO Participation A-1
following which a severed portion is reallocated to the corresponding CLO
Participation A-2 and the other severed portion is the subject of a new
Transaction under this Agreement) and (z) any other amounts payable under this
Agreement (including, without limitation, Section 3(i) of this Agreement) with
respect to such Transaction, in connection with the transfer to Seller or its
agent of such Purchased Loan; provided, however, that no amounts shall be due
and payable pursuant to Section 3(i)(ii) of this Agreement in connection with a
termination of a Transaction by Seller in part or in whole in the circumstance
described in the parenthetical to clause (ii)(y) above,

 

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  (iii)

on such Early Repurchase Date, following the payment of the amounts set forth in
subclause (ii) above, no unpaid Margin Deficit exists, and

 

  (iv)

no Default or Event of Default shall have occurred and be continuing as of such
Early Repurchase Date.

Such notice shall set forth the Early Repurchase Date and shall identify with
particularity the Purchased Loans to be repurchased on such Early Repurchase
Date.

(e) On the Repurchase Date or any Early Repurchase Date (including, without
limitation, in order to cure a Margin Deficit), termination of the applicable
Transaction will be effected by transfer to Seller or its agent of the
applicable Purchased Loan and any Income in respect thereof received by Buyer
(and not previously credited or transferred to, or applied to the obligations
of, Seller pursuant to Section 5 of this Agreement) against the simultaneous
transfer to an account of Buyer of the Repurchase Price, the amount, if any,
payable by Seller in the event any Hedging Transaction related to such Purchased
Loan is being terminated as of such date and any other amounts payable under
this Agreement with respect to such Transaction.

(f) On any Remittance Date before the Repurchase Date (or any Business Day
before the Repurchase Date upon two (2) Business Days prior notice to Buyer,
with respect to a reduction in outstanding Purchase Price of greater than
$2,000,000 (or, with respect to any Foreign Purchased Loan, the then-current
equivalent of such amount based on the Spot Rate with respect to the Applicable
Currency of such Foreign Purchased Loan as of the date of determination), Seller
shall have the right, from time to time, to transfer cash (in the Applicable
Currency of the related Purchased Loan) to Buyer for the purpose of reducing the
outstanding Purchase Price of, but not terminating, a Transaction and without
the release of any Collateral or the payment of any Exit Fee or other prepayment
fee or penalty; provided, that any such reduction in outstanding Purchase Price
occurring on a date other than a Remittance Date shall be required to be
accompanied by payment of all unpaid accrued Price Differential on the amount of
such reduction. Upon any reduction in outstanding Purchase Price in accordance
with this Section 3(f), either Seller or Buyer can request an amended and
restated Confirmation which shall reflect the decrease in the outstanding
Purchase Price (it being acknowledged that the failure by any party to request
or deliver such amended and restated Confirmation shall not be a Default).

(g) If prior to any Pricing Rate Period with respect to any Transaction, Buyer
shall have determined in the exercise of its reasonable business judgment (which
determination shall be conclusive and binding upon Seller) that, (i) by reason
of circumstances affecting the relevant market, adequate and reasonable means do
not exist for ascertaining the Index Rate for such Pricing Rate Period, or
(ii) in the case of any Purchased Loan for which the LIBO Rate or the EURIBO
Rate is the Index Rate, that LIBOR or EURIBOR, as applicable, has been succeeded
by an Alternative Rate, Buyer shall give written notice thereof to Seller as
soon as practicable thereafter, which notice shall set forth the affected
Transactions and the circumstances for such

 

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determination in reasonable detail. If such notice is given, the Pricing Rate
with respect to such affected Transactions for such Pricing Rate Period, and for
any subsequent Pricing Rate Periods until such notice has been withdrawn by
Buyer (which withdrawal shall be delivered by Buyer promptly after Buyer becomes
aware that the condition for switching to the Alternative Rate no longer exists)
shall be a per annum rate determined by reference to the Alternative Rate in
lieu of the applicable Index Rate. In exercising its rights and remedies under
this Article 3(g), Buyer shall act in a manner consistent to how Buyer is
contemporaneously treating its similarly situated customers domiciled in the
United States under repurchase facilities under which Buyer has a comparable
contractual right, which repurchase facilities finance commercial real estate
mortgage loans of similar type, size and duration to the affected Purchased
Loans and which are otherwise similar to such Purchased Loans in a manner which
is material to Buyer’s determination hereunder (“Similar Loans”).

(h) Notwithstanding any other provision herein, if the adoption of or any change
in any Requirement of Law or in the interpretation or application thereof shall
make it unlawful for Buyer to effect or continue Transactions as contemplated by
the Transaction Documents, (a) the commitment of Buyer hereunder to enter into
new Transactions shall forthwith be canceled, and (b) the Transactions then
outstanding shall be converted automatically to Alternative Rate Transactions on
the last day of the then current Pricing Rate Period or within such earlier
period as may be required by law. If any such conversion of a Transaction occurs
on a day which is not the last day of the then current Pricing Rate Period with
respect to such Transaction, Seller shall pay to Buyer such amounts, if any, as
may be required pursuant to Section 3(i) of this Agreement.

(i) Upon written demand by Buyer, Seller shall indemnify Buyer and hold Buyer
harmless from any net actual, out-of-pocket loss or expense (not to include any
lost profit or opportunity or other consequential costs, loss or damages)
(including, without limitation, reasonable actual attorneys’ fees and
disbursements of outside counsel) which Buyer sustains or incurs as a
consequence of (i) default by Seller in terminating any Transaction after Seller
has given a notice in accordance with Section 3(d) hereof of a termination of a
Transaction, (ii) any payment of the Repurchase Price on any day other than a
Remittance Date or the Repurchase Date (including, without limitation, any such
actual, out-of-pocket loss or expense arising from the reemployment of funds
obtained by Buyer to maintain Transactions hereunder or from customary and
reasonable fees payable to terminate the deposits from which such funds were
obtained) or (iii) a default by Seller in selling Eligible Loans after Seller
has delivered to Buyer an executed Confirmation in connection with a proposed
Transaction and Buyer has agreed to purchase such Eligible Loans in accordance
with the provisions of this Agreement as evidenced by a countersigned
Confirmation executed by Buyer and delivered to Seller. A certificate as to such
actual costs, losses, damages and expenses, setting forth the calculations
therefor shall be submitted promptly by Buyer to Seller.

(j) If the adoption of or any change in any Requirement of Law or in the
interpretation or application thereof by any Governmental Authority or
compliance by Buyer with any request or directive from any central bank or other
Governmental Authority having jurisdiction over Buyer made subsequent to the
date hereof:

 

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  (i)

shall subject Buyer to any tax of any kind whatsoever with respect to the
Transaction Documents, any Purchased Loan or any Transaction, or change the
basis of taxation of payments to Buyer in respect thereof (except for
(i) Indemnified Taxes (with Other Taxes applying for this purpose without the
proviso in the definition thereof), (ii) Taxes described in clauses (b) through
(h) of the definition of Excluded Taxes and (iii) Connection Income Taxes); or

 

  (ii)

shall impose, modify or hold applicable any reserve, special deposit, compulsory
loan or similar requirement against assets held by, deposits or other
liabilities in or for the account of, advances, loans or other extensions of
credit by, or any other acquisition of funds by, any office of Buyer which is
not otherwise included in the determination of the Index Rate hereunder;

and the result of any of the foregoing is to increase the cost to Buyer, by an
amount which Buyer deems, in the exercise of its reasonable business judgment,
to be material, of entering into, continuing or maintaining Transactions or to
reduce in a material manner any amount receivable under the Transaction
Documents in respect thereof; then, in any such case, and provided Buyer imposes
such additional costs generally on all of its similarly situated customers,
Seller shall pay to Buyer within ten (10) Business Days any additional amounts
necessary to compensate Buyer for such increased cost or reduced amount
receivable. If Buyer becomes entitled to claim any additional amounts pursuant
to this Section 3(j), it shall notify Seller in writing of the event by reason
of which it has become so entitled. Such notification as to the calculation of
any additional amounts payable pursuant to this subsection shall be submitted by
Buyer to Seller. Any claim by Buyer made under this clause Section 3(j) arising
in connection with any Transaction relating to a Foreign Purchased Loan (AU)
shall be accompanied by reasonable details of the event giving rise to such
claim and, if made more than one hundred eighty (180) days after Buyer becomes
aware of and was able to quantify the applicable loss or expense, cannot be made
in respect of any period occurring more than one hundred eighty (180) days
before the date of the applicable demand.

(k) If Buyer shall have determined that the adoption of or any change in any
Requirement of Law regarding capital adequacy or in the interpretation or
application thereof or compliance by Buyer or any corporation controlling Buyer
with any request or directive regarding capital adequacy (whether or not having
the force of law) from any Governmental Authority made subsequent to the date
hereof has the effect of reducing the rate of return on Buyer’s or such
corporation’s capital deployed in respect of any Transaction as a consequence of
its obligations hereunder to a level below that which Buyer or such corporation
could have achieved but for such adoption, change or compliance (taking into
consideration Buyer’s or such corporation’s policies with respect to capital
adequacy) by an amount deemed by Buyer, in the exercise of its reasonable
business judgment, to be material, then from time to time, after submission by
Buyer to Seller of a written request therefor, and provided Buyer imposes such
additional costs generally on all of its similarly situated customers, Seller
shall pay to Buyer within ten (10) Business Days such additional amount or
amounts as will compensate Buyer for such reduction. Such notification as to the
calculation of any additional amounts payable

 

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pursuant to this subsection shall be submitted by Buyer to Seller. Any claim by
Buyer made under this clause Section 3(k) arising in connection with any
Transaction relating to a Foreign Purchased Loan (AU) shall be accompanied by
reasonable details of the event giving rise to such claim and, if made more than
one hundred eighty (180) days after Buyer becomes aware of and was able to
quantify the applicable amount, cannot be made in respect of any period
occurring more than one hundred eighty (180) days before the date of the
applicable demand.

(l) Notwithstanding the foregoing or anything herein or in the Fee Agreement to
the contrary, (x) if any Transaction is converted to an Alternative Rate
Transaction, then Seller may consummate an early repurchase of the related
Purchased Loan at any time while the Alternative Rate is in effect without
payment of the Exit Fee, (y) if Buyer notifies Seller of its entitlement to
additional amounts pursuant to Section 3(j) or 3(k), then provided Seller pays
such additional amounts pursuant to Section 3(j) or 3(k), Seller may consummate
an early repurchase of all of the Purchased Loans and terminate this Agreement
and the other Transaction Documents without payment of the Exit Fee and (z) no
Exit Fee shall be due and payable in connection with any reduction in
outstanding Purchase Price or consummation of an early repurchase of a Purchased
Loan in accordance with Section 4(a).

(m) Notwithstanding the foregoing or anything herein to the contrary, neither
Section 3(i) nor Section 3(k) shall apply with respect to any Transaction
relating to a Foreign Purchased Loan (AU) the extent such loss, expense or other
amount otherwise covered by such Sections are attributable to the implementation
or application of or compliance with Basel II or Basel III, to the extent full
details have been officially announced and publicly released prior to the date
of this Agreement and which are applicable to the Buyer.

(n) Notwithstanding the foregoing or anything herein to the contrary, Buyer, in
consultation with Seller, shall take all reasonable steps consistent with
prudent banking practice to mitigate any circumstances which would result in any
consequence described in Section 3(h) and any amount becoming payable under any
of Sections 3(i) through (k), in each case with respect to each Foreign
Purchased Loan (AU) (including transferring its rights and obligations under the
Transaction Documents to a related entity of Buyer or changing its lending
office), provided that Buyer shall not be obligated to take any steps under this
Section 3(n) if, in Buyer’s opinion (acting reasonably), to do so might be
prejudicial to it. Seller shall indemnify Buyer and hold Buyer harmless from any
reasonable out-of-pocket loss or expense (not to include any lost profit or
opportunity or other consequential costs, loss or damages) (including, without
limitation, reasonable actual attorneys’ fees and disbursements of outside
counsel) which Buyer sustains or incurs as a result of steps required to be
taken by it under this Section 3(n).

 

4.

MARGIN MAINTENANCE

(a) If, at any time, (w) the aggregate Market Value of all U.S. Purchased Loans
shall be less than the sum of the Margin Amounts calculated individually with
respect to each U.S. Purchased Loan, (x) the aggregate Market Value of all
Foreign Purchased Loans (EUR) shall be less than the sum of the Margin Amounts
calculated individually with respect to each Foreign Purchased Loan (EUR), (y)
the aggregate Market Value of all Foreign Purchased Loans (GBP) shall be less
than the sum of the Margin Amounts calculated individually with respect to each
Foreign Purchased Loan (GBP), or (z) the aggregate Market Value of all Foreign
Purchased

 

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Loans (AU) shall be less than the sum of the Margin Amounts calculated
individually with respect to each Foreign Purchased Loan (AU) (each of the
foregoing clauses (w), (x), (y) and (z), a “Margin Deficit”), then in any such
case Buyer may by notice to Seller in writing (including therein a description
of the then-current Market Value calculation for the Purchased Loan for which a
Margin Deficit exists, together with a description of the then-current Market
Value calculation for all other Purchased Loans) require Seller to cure such
Margin Deficit by any of the following methods selected by Seller:

 

  (i)

transferring to Buyer additional cash collateral in an amount at least equal to
the sum of the amounts, calculated individually for each U.S. Purchased Loan,
Foreign Purchased Loan (EUR), Foreign Purchased Loan (GBP) or Foreign Purchased
Loan (AU), as applicable, equal to the product of (x) the difference between the
Margin Amount with respect to such Purchased Loan and the Market Value of such
Purchased Loan multiplied by (y) the applicable Maximum Purchase Price
Percentage, which cash collateral shall be held by Buyer as additional
Collateral with respect to the applicable Purchased Loan(s);

 

  (ii)

reducing the outstanding Purchase Price of any U.S. Purchased Loan, Foreign
Purchased Loan (EUR), Foreign Purchased Loan (GBP) or Foreign Purchased Loan
(AU), as applicable, such that the aggregate Market Value of the U.S. Purchased
Loans, Foreign Purchased Loans (EUR), Foreign Purchased Loan (GBP) or Foreign
Purchased Loan (AU), as applicable, is at least equal to or is greater than the
sum of the Margin Amounts of the U.S. Purchased Loans, Foreign Purchased Loans
(EUR), Foreign Purchased Loan (GBP) or Foreign Purchased Loan (AU), as
applicable; or

 

  (iii)

doing an early repurchase on an Early Repurchase Date of any U.S. Purchased
Loan, Foreign Purchased Loan (EUR), Foreign Purchased Loan (GBP) or Foreign
Purchased Loan (AU), as applicable, pursuant to Section 3(d) of this Agreement
and paying the related Repurchase Price which early repurchase results in a cure
of such Margin Deficit.

With respect to this Section 4(a), such payments and/or reductions shall be made
by Seller in the Applicable Currency of the related Purchased Loan(s) with
respect to which such Margin Deficit exists. Any cash transferred to Buyer
pursuant to clause (ii) of this Section 4(a) of this Agreement with respect to
any Purchased Loan shall be applied to reduce the outstanding Purchase Price for
such Purchased Loan on a “dollar-for-dollar” basis for which there was a Margin
Deficit. Notwithstanding the foregoing or anything herein to the contrary, a
Margin Deficit shall not exist or be deemed to exist with respect to any
Purchased Loan at any time the outstanding Purchase Price with respect to such
Purchased Loan is less than 60% of the related Market Value.

 

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(b) If any notice is given by Buyer under Section 4(a) of this Agreement on any
Business Day (such notice, a “Margin Deficit Notice”) and Seller elects to
transfer cash pursuant to Section 4(a)(i) or (ii), Seller shall transfer cash in
the full amount (and in the Applicable Currency) required in Section 4(a)(i) or
(ii), if the Margin Deficit Notice is given before 1:00 p.m. EST, by no later
than the close of business on the Business Day following the Business Day on
which such Margin Deficit Notice is given, and if the Margin Deficit Notice is
given on or after 1:00 p.m. EST, by no later than the close of business on the
second (2nd) Business Day following the Business Day on which such Margin
Deficit Notice is given. The failure of Buyer, on any one or more occasions, to
exercise its rights under Section 4(a) of this Agreement shall not change or
alter the terms and conditions to which this Agreement is subject or limit the
right of Buyer to do so at a later date. Buyer and Seller agree that any failure
or delay by Buyer to exercise its rights under Section 4(a) of this Agreement
shall not limit such party’s rights under this Agreement or otherwise existing
by law or in any way create additional rights for such party.

(c) At any time prior to the Facility Expiration Date, in the event a future
funding is contractually required to be made available to the related Mortgagor
under a Purchased Loan, Seller may submit to Buyer a Request for Margin Excess,
in the form of Exhibit IX attached hereto, which requests that Buyer transfer to
Seller, by wire transfer to an account of Seller or as directed by Seller in
writing (and subject to the last sentence of Section 17), cash (in the
Applicable Currency of such Purchased Loan) in an amount equal to the product of
a percentage, not to exceed the applicable Maximum Purchase Price Percentage for
such Purchased Loan, multiplied by the amount of such future funding (such
product, “Margin Excess (Future Funding)”), which cash shall be applied to
increase the outstanding Purchase Price with respect to the Transaction for such
Purchased Loan and to satisfy such future funding obligation in part; provided,
that, Buyer shall not have any obligation to transfer such Margin Excess (Future
Funding) to Seller unless Buyer shall have determined that all of the following
conditions precedent (such conditions, the “Future Funding Conditions
Precedent”) are satisfied:

 

  (i)

If in connection with the entry into the initial Transaction relating to the
Purchased Loan that is the subject of a future funding obligation, Buyer and
Seller agreed upon additional conditions precedent which are required to be
satisfied (e.g. maintenance of or improvement in Debt Yield (Purchase Price)
and/or Debt Yield (Loan UPB)) with respect to such Purchased Loan and which are
specified in the Confirmation, taking into account the increase in the
outstanding Purchase Price attributable to such Margin Excess (Future Funding),
then such additional conditions precedent are satisfied;

 

  (ii)

taking into account the increase in the outstanding Purchase Price attributable
to such Margin Excess (Future Funding), the LTV (Purchase Price) shall not
exceed sixty percent (60%);

 

  (iii)

no Default or Event of Default has occurred and is continuing;

 

  (iv)

the increase in the outstanding Purchase Price with respect to such Purchased
Loan attributable to such Margin Excess (Future Funding) shall be equal to or
greater than $250,000 (or, with respect to any Foreign Purchased Loan, the
then-current equivalent of such amount based on the Spot Rate with respect to
the Applicable Currency of such Foreign Purchased Loan as of the date of
determination);

 

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  (v)

Seller shall have demonstrated to Buyer’s reasonable satisfaction that all
conditions precedent to the future funding obligation under the Purchased Loan
documentation shall have been satisfied in all material respects; and

 

  (vi)

following such increase in the outstanding Purchase Price attributable to such
Margin Excess (Future Funding), no Margin Deficit shall exist.

In addition to and in no way limiting Seller’s right to submit to Buyer a
Request for Margin Excess in accordance with this Section 4(c), concurrent with
or following a future funding made by Seller to a Mortgagor under a Purchased
Loan, Seller may submit to Buyer a written request that Buyer, after applying
all of the Future Funding Conditions Precedent referred to above, provide Seller
with an indication of the amount of availability created with respect to such
Purchased Loan by Seller making such future funding.

(d) If any notice is given by Seller under Section 4(c) of this Agreement on any
Business Day, Buyer shall transfer cash as provided in Section 4(c) (and subject
to the last sentence of Section 17) by no later than the close of business on
the second (2nd) Business Day following the Business Day on which Buyer
reasonably determines that the Future Funding Conditions Precedent have been
satisfied (or, in Buyer’s sole discretion, waived). The failure of Seller, on
any one or more occasions, to exercise its rights under Section 4(c) of this
Agreement shall not change or alter the terms and conditions to which this
Agreement is subject or limit the right of Seller to do so at a later date.
Buyer and Seller agree that any failure or delay by Seller to exercise its
rights under Section 4(c) of this Agreement shall not limit such party’s rights
under this Agreement or otherwise existing by law or in any way create
additional rights for such party.

(e) At any time prior to the Facility Expiration Date, in the event,

(x)(a) Seller elects to transfer cash to Buyer pursuant to Section 4(a)(i) or
(ii) to satisfy a Margin Deficit and (b) on any date subsequent to such transfer
of cash, the Market Value of a Purchased Loan increases such that the
outstanding Purchase Price (or if cash collateral was transferred in accordance
with Section 4(a)(i), the outstanding Purchase Price less such cash collateral
so transferred) with respect to such Purchased Loan is less than the Maximum
Purchase Price with respect to such Purchased Loan, or

(y)(a) Seller elects to transfer cash to Buyer pursuant to Section 3(f) or
elects as described in the definition of Pricing Matrix to receive on the
applicable Purchase Date a Purchase Price lower than the Maximum Purchase Price
of such Purchased Loan and (b) on any date subsequent to such transfer of cash,
Seller desires to receive a re-advance of such cash so transferred or an
additional advance of cash in an amount up to the Maximum Purchase Price of such
Purchased Loan (the difference between the actual outstanding Purchase Price (or
outstanding Purchase Price less cash collateral transferred, as the case may
be), and the Maximum Purchase Price, the “Margin Excess (Other)”),

 

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then Seller in either case may submit to Buyer a Request for Margin Excess, in
the form of Exhibit IX attached hereto, which requests that Buyer transfer to
Seller an amount up to such Margin Excess (Other) (in the Applicable Currency of
the Purchased Loan for which such Margin Excess (Other) exists), by wire
transfer to an account of Seller or designated by Seller in writing (and subject
to the last sentence of Section 17); provided, that, Buyer shall not have any
obligation to transfer such Margin Excess (Other) to Seller unless Buyer shall
have determined that all of the following conditions precedent are satisfied:

 

  (i)

no Default or Event of Default has occurred and is continuing;

 

  (ii)

with respect to any Purchased Loan, the amount of cash transferred by Buyer
pursuant to clause (x) or (y) above shall not cause the Purchase Price to exceed
the Maximum Purchase Price for such Purchased Loan;

 

  (iii)

the increase in the outstanding Purchase Price with respect to such Purchased
Loan attributable to such Margin Excess (Other) shall be equal to or greater
than $250,000 (or, with respect to any Foreign Purchased Loan, the then-current
equivalent of such amount based on the Spot Rate with respect to the Applicable
Currency of such Foreign Purchased Loan as of the date of determination); and

 

  (iv)

following such increase in the outstanding Purchase Price attributable to such
Margin Excess (Other), no Margin Deficit shall exist.

(f) If any Request for Margin Excess is given by Seller on any Business Day
under (x) Section 4(e)(x) of this Agreement, Buyer shall transfer cash as
provided in Section 4(e) by no later than the close of business on the next
succeeding Business Day following the Business Day on which Buyer has completed
its calculation of Market Value, or (y) Section 4(e)(y) of this Agreement, Buyer
shall transfer cash as provided in Section 4(e) by no later than the close of
business on the next succeeding Business Day following the Business Day on which
such Request for Margin Excess is submitted. The failure of Seller, on any one
or more occasions, to exercise its rights under Section 4(e) of this Agreement
shall not change or alter the terms and conditions to which this Agreement is
subject or limit the right of Seller to do so at a later date. Buyer and Seller
agree that any failure or delay by Seller to exercise its rights under
Section 4(e) of this Agreement shall not limit such party’s rights under this
Agreement or otherwise existing by law or in any way create additional rights
for such party.

(g) Promptly following the transfer of Margin Excess by Buyer to Seller, or any
increase to the Market Value of a Purchased Loan, in each case pursuant to
Section 4(c) and 4(d) or 4(e) and 4(f), as applicable, Buyer and Seller shall
revise the Confirmation to reflect the revised outstanding Purchase Price,
Maximum Purchase Price, Purchase Price Percentage, and Maximum Purchase Price
Percentage for such Purchased Loan, as applicable, and any other necessary
modifications to the terms set forth on the existing Confirmation.

(h) In the event Seller requests to enter into a Transaction with Buyer with
respect to any Eligible Loan which includes Margin Excess (Future Funding)
obligations approved by Buyer, or Seller requests a Margin Excess (Future
Funding) with respect to any Purchased Loan, and the result of such Transaction
with respect to such Eligible Loan or the funding of such Margin Excess (Future
Funding) with respect to such Purchased Loan would be that, the sum of

 

45

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Column A plus Column B plus Column C calculated with respect to all Purchased
Loans collectively (including for this purpose, such Eligible Loan) (with such
calculation with respect to Foreign Purchased Loans to be based on the
applicable amounts converted to U.S. Dollars based on the Purchase Date Spot
Rate (U.S. Dollars) for such Foreign Purchased Loan) would exceed the Facility
Amount, then Seller may notify Buyer in writing that Seller elects to reallocate
downward, in its sole discretion, the amount referenced in Column C with respect
to any Purchased Loan by an amount necessary for the sum of Column A plus Column
B plus Column C calculated with respect to all Purchased Loans collectively
(including for this purpose, such Eligible Loan) (with such calculation with
respect to Foreign Purchased Loans to be based on the applicable amounts
converted to U.S. Dollars based on the Purchase Date Spot Rate (U.S. Dollars)
for such Foreign Purchased Loan) not to exceed, with respect to all Purchased
Loans collectively (including for this purpose, such Eligible Loan), the
Facility Amount. Notwithstanding the foregoing, Seller shall be permitted, at
any time and from time to time, upon written notice to Buyer, to reallocate
upward or downward the amount referenced in Column C with respect to any
Purchased Loan so long as (a) the sum of Column A plus Column B plus Column C
calculated with respect to all Purchased Loans collectively (with such
calculation with respect to Foreign Purchased Loans to be based on the
applicable amounts converted to U.S. Dollars based on the Purchase Date Spot
Rate (U.S. Dollars) for such Foreign Purchased Loan) does not exceed the
Facility Amount, and (b) any upward reallocation of the amount referenced in
Column C for any Purchased Loan does not exceed the amount referenced in Column
E with respect to such Purchased Loan. Upon making any such reallocations,
Seller shall promptly deliver to Buyer (by e-mail) a Facility Asset Chart, which
then-current Facility Asset Chart shall represent the definitive allocation of
Buyer’s Margin Excess (Future Funding) obligations with respect to all Purchased
Loans. Notwithstanding anything to the contrary set forth in this Agreement or
any other Transaction Document, Buyer and Seller hereby acknowledge and agree
that, as of any date of determination, (i) the amount referenced in Column C of
the then-current version of the Facility Asset Chart with respect to any
Purchased Loan shall be the maximum amount of Margin Excess (Future Funding)
that Buyer would be obligated to transfer to Seller with respect to such
Purchased Loan upon satisfaction of the Future Funding Conditions Precedent, in
accordance with Sections 4(c) and (d) of this Agreement, and (ii) the sum of
Column A plus Column B plus Column C calculated with respect to each Purchased
Loan individually, as reflected in Column D, shall not exceed, with respect to
all Purchased Loans collectively (with such calculation with respect to Foreign
Purchased Loans to be based on the applicable amounts converted to U.S. Dollars
based on the Purchase Date Spot Rate (U.S. Dollars) for such Foreign Purchased
Loan), the Facility Amount.

 

5.

INCOME PAYMENTS AND PRINCIPAL PAYMENTS

(a) Each Cash Management Account shall be established at the Depository, which
(i) in the case of the Cash Management Account established by Parlex 2, shall
have been established on June 12, 2013, (ii) in the case of the Cash Management
Account established by Parlex 2A, shall have been established on January 31,
2014, (iii) in the case of the Cash Management Account established by Parlex 2
UK, shall have been established on the Second Amendment and Restatement Date,
(iv) in the case of the Cash Management Account established by Parlex 2 EUR,
shall have been established on the Second Amendment and Restatement Date, (v) in
the case of the Cash Management Account established by Parlex 2 AU, shall have
been established

 

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on the Third Amendment and Restatement Date, and (vi) in the case of any Cash
Management Account established by any Person that joins as a Seller under this
Agreement from time to time, shall be established concurrently with the
execution and delivery of the Joinder Agreement by which such Person joins as a
Seller under this Agreement. Buyer shall have sole dominion and control over
each Cash Management Account. All Income in respect of the Purchased Loans and
any payments in respect of associated Hedging Transactions, as well as any
interest received from the reinvestment of such Income, shall be deposited
directly into the applicable Cash Management Account and shall be remitted by
the Depository in accordance with the provisions of the applicable Blocked
Account Agreement and Servicing Agreement (which remittances shall be in
conformity to the applicable provisions of Sections 5(d), 5(e), 5(f) and
14(b)(iii) of this Agreement).

(b) With respect to each Purchased Loan, Seller shall deliver to each Mortgagor,
issuer of a participation or borrower or similar Person (however described)
under a Purchased Loan an irrevocable direction letter (the “Irrevocable
Direction Letter”) in the form attached as Exhibit X to this Agreement (in the
case of any Foreign Purchased Loan, with such reasonable changes as are mutually
agreed upon by Buyer and Seller to reflect any equivalent terminology, customary
market practices, Requirements of Law in the relevant non-U.S. jurisdiction, in
each case applicable to such Foreign Purchased Loan) with a simultaneous copy to
Servicer, instructing the Mortgagor and Servicer to pay all amounts payable
under the related Purchased Loan to the applicable Cash Management Account and
shall provide to Buyer proof of such delivery. If a Mortgagor or Servicer
forwards any Income with respect to a Purchased Loan to Seller rather than
directly to the applicable Cash Management Account, Seller shall (i) deliver an
additional Irrevocable Direction Letter to the applicable Mortgagor, with a
simultaneous copy to Servicer, and make other commercially reasonable efforts to
cause such Mortgagor or Servicer to forward such amounts directly to the
applicable Cash Management Account and (ii) deposit in the applicable Cash
Management Account any such amounts within one Business Day of Seller’s receipt
thereof.

(c) On each Remittance Date, Seller shall pay to Buyer an amount equal to the
Price Differential which has accrued during the related Pricing Rate Period for
each Transaction to the extent not previously paid to Buyer.

(d) So long as no Event of Default shall have occurred and be continuing, during
the Facility Availability Period (or, with respect to Foreign Purchased Loans
(AU) only, at any time), all Income received by the Depository in respect of the
Purchased Loans and the associated Hedging Transactions (other than Principal
Payments and net sale proceeds) may be remitted by the Depository on the next
Business Day to the account of Seller specified in the applicable Blocked
Account Agreement (or in accordance with such other direction and instruction of
Seller which is reasonably approved by Buyer).

(e) So long as no Event of Default shall have occurred and be continuing, during
the Facility Availability Period, all Principal Payments in respect of each
Purchased Loan received by the Depository shall be paid, pursuant to the
withdrawal instructions of Seller that have been approved by Buyer, either
(x) with respect to scheduled Principal Payments (other than Principal Payments
in full), on the next Remittance Date, or (y) with respect to unscheduled
Principal

 

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Payments and scheduled Principal Payments in full, on the first (1st) Business
Day immediately following the date such Principal Payment was deposited in the
applicable Cash Management Account), and, in each instance, applied as follows:
(i) first, toward the reduction of the outstanding Purchase Price of such
Purchased Loan to the extent necessary to cause the outstanding Purchase Price
with respect to such Purchased Loan to equal the product of the related Market
Value and the applicable Purchase Price Percentage (or with respect to any
Principal Payment in full, in the amount necessary to reduce the outstanding
Purchase Price of such Purchased Loan to zero) and (ii) second, to the extent
necessary to cause the outstanding Purchase Price with respect to each other
Purchased Loan to equal the product of the related Market Value and the
applicable Purchase Price Percentage. Any Principal Payments received by the
Depository and not paid to Buyer pursuant to the preceding sentence during the
Facility Availability Period shall be remitted promptly to Seller.

(f) Following the end of the Facility Availability Period (so long as no Event
of Default shall have occurred and be continuing), all Income received by the
Depository (and, with respect to Foreign Purchased Loans (AU), Seller) in
respect of any Purchased Loan and the associated Hedging Transactions shall be
applied, pursuant to the withdrawal instructions of Seller that have been
approved by Buyer (which withdrawal instructions shall set forth the applicable
Spot Rate(s) referenced in clause (vii) below), by the Depository (and, with
respect to Foreign Purchased Loans (AU), Seller) on each Remittance Date as
follows (subject to the following sentence):

 

  (i)

first, to the Depository and Custodian an amount equal to the depository and
custodial fees due and payable;

 

  (ii)

second, to Buyer an amount equal to its out-of-pocket costs and expenses and any
other amounts due and payable under this Agreement;

 

  (iii)

third, to Buyer an amount equal to the Price Differential which has accrued and
is outstanding in respect of all of the Purchased Loans denominated in the same
Applicable Currency as the Purchased Loan from which the Income was received as
of such Business Day, such payment to be allocated amongst all such Purchased
Loans on a pro rata basis based upon the outstanding Purchase Price of each such
Purchased Loan;

 

  (iv)

fourth, to pay the amount, if any, payable by Seller in the event any Hedging
Transaction is being terminated as of such date;

 

  (v)

fifth, to make a payment to Buyer in reduction of the outstanding Purchase Price
of the Purchased Loan from which the Income was received;

 

  (vi)

sixth, to make a payment to Buyer in reduction of the outstanding Purchase Price
of all of the Purchased Loans denominated in the same Applicable Currency as the
Purchased Loan from which the Income was received, such payment to be allocated
amongst all such Purchased Loans on a pro rata basis based upon the outstanding
Purchase Price of each such Purchased Loan;

 

48

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  (vii)

seventh, to make a payment to Buyer in reduction of the outstanding Purchase
Price of all of the Purchased Loans denominated in an Applicable Currency
different than the Applicable Currency of the Purchased Loan from which the
Income was received, such payment to be allocated amongst all such Purchased
Loans on a pro rata basis based upon the outstanding Purchase Price of each such
Purchased Loan (which pro rata allocation shall be calculated based on the
then-current equivalent of such Purchase Price in the Applicable Currency of the
Purchased Loan from which the Income was received based on the applicable Spot
Rate as of the date of determination); and

 

  (viii)

eighth, the surplus, if any, to Seller.

Notwithstanding anything in Section 5(f) of this Agreement to the contrary,
prior to the application of funds pursuant to such Section, Seller shall be
entitled upon written request to Buyer to receive the amount of funds, if any,
as may be required by applicable law to be distributed for Guarantor to maintain
its status as a “real estate investment trust” for tax purposes and to avoid
other adverse tax consequences to Guarantor and/or its shareholders related to
the status of Guarantor as a “real estate investment trust” for tax purposes;
provided, that such distribution shall be subject to the condition precedent
(which Seller shall be required to demonstrate to the satisfaction of Buyer in
its sole discretion) that Guarantor has exhausted all other sources of cash flow
and income, whether in the form of equity or debt, prior to such request being
made to Buyer.

(g) If an Event of Default shall have occurred and be continuing, all Income
received by the Depository in respect of the Purchased Loans and the associated
Hedging Transactions shall be applied, upon the direction and instruction of
Buyer, by the Depository on the Business Day next following the Business Day on
which such funds are deposited in the applicable Cash Management Account as
follows:

 

  (i)

first, to the Depository and Custodian an amount equal to the depository and
custodial fees due and payable;

 

  (ii)

second, to Buyer an amount equal to its out-of-pocket costs and expenses and any
other amounts due and payable under this Agreement;

 

  (iii)

third, to Buyer an amount equal to the Price Differential which has accrued and
is outstanding in respect of all of the Purchased Loans as of such Business Day;

 

  (iv)

fourth, to make a payment to Buyer in reduction of the outstanding Purchase
Price of the Purchased Loans, such payment to be allocated amongst the Purchased
Loans as determined by Buyer in its sole discretion, until the outstanding
Purchase Price for all of the Purchased Loans has been reduced to zero;

 

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  (v)

fifth, to pay, the amount, if any, payable by Seller in the event any Hedging
Transaction related to such Purchased Loan is being terminated as of such date;
and

 

  (vi)

sixth, the surplus, if any, to whoever may be lawfully entitled to receive such
surplus.

(h) Notwithstanding any other provision of this Section 5, Income derived from
Foreign Purchased Loans (AU) which require quarterly (as opposed to monthly)
interest payments by the relevant Mortgagor, which Income is credited to Parlex
2 AU’s Cash Management Account shall only be distributed pursuant to this
Section 5 on Remittance Dates specified in clause (b)(ii) of the definition
thereof, and shall remain in such Cash Management Account and shall not be
applied to any payments pursuant to this Section 5 on any Remittance Date
specified in clause (b)(i) of the definition thereof.

 

6.

SECURITY INTEREST

Buyer and Seller intend that all Transactions hereunder be sales to Buyer of the
Purchased Loans and not loans from Buyer to Seller secured by the Purchased
Loans (other than for tax purposes). However, in the event any such Transaction
is deemed to be a loan, Seller hereby pledges all of its right, title, and
interest in, to and under and grants a first priority lien on, and security
interest in, all of Seller’s interest in the following property, whether now
owned or hereafter acquired, now existing or hereafter created and wherever
located (collectively, the “Collateral”) to Buyer to secure the payment and
performance of all other amounts or obligations owing to Buyer pursuant to this
Agreement and the related documents described herein:

(a) the Purchased Loans, the Servicing Rights, Servicing Agreements, Servicing
Records, insurance relating to the Purchased Loans, and collection and escrow
accounts relating to the Purchased Loans;

(b) the Hedging Transactions, if any, entered into pursuant to this Agreement;

(c) each Cash Management Account and all financial assets (including, without
limitation, all security entitlements with respect to all financial assets) from
time to time on deposit in each Cash Management Account;

(d) the Foreign Assignment Agreement, if any;

(e) all “general intangibles”, “accounts” and “chattel paper” as defined in the
UCC relating to or constituting any and all of the foregoing; and

(f) all replacements, substitutions or distributions on or proceeds, payments,
Income and profits of, and records (but excluding any financial models or other
proprietary information) and files relating to any and all of any of the
foregoing.

 

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Buyer’s security interest in the Collateral shall terminate only upon
termination of Seller’s obligations under this Agreement and the documents
delivered in connection herewith and therewith. Upon such termination, Buyer
shall promptly deliver to Seller such UCC termination statements, the equivalent
under applicable Requirements of Law in the relevant non-U.S. jurisdiction (with
respect to Foreign Purchased Loans) and other release documents as may be
commercially reasonable and to return the Purchased Loans to Seller and, in the
case of each Foreign Purchased Loan (AU), the Buyer shall promptly register a
financing change statement on the PPS Register amending or removing any
registration on the PPS Register relating to such Collateral. For purposes of
the grant of the security interest pursuant to this Section 6, this Agreement
shall be deemed to constitute a security agreement under the New York Uniform
Commercial Code (the “UCC”) and, in relation to each Foreign Purchased Loan
(AU), under the PPSA. Buyer shall have all of the rights and may exercise all of
the remedies of a secured creditor under applicable Requirements of Law in the
relevant jurisdiction (including, with respect to U.S. Purchased Loans, the UCC
and the other laws of the State of New York). In furtherance of the foregoing,
(a) Buyer, at Seller’s sole cost and expense, shall cause to be filed in such
locations as may be reasonably necessary to perfect and maintain perfection and
priority of the security interest granted hereby and by any Foreign Assignment
Agreement, UCC financing statements and continuation statements or their
equivalent under applicable Requirements of Law in the relevant non-U.S.
jurisdiction, including any registrations on the PPS Register (with respect to
Foreign Purchased Loans) (collectively, the “Filings”), and shall forward copies
of such Filings to Seller upon completion thereof, and (b) Seller shall from
time to time take such further actions as may be reasonably requested by Buyer
to maintain and continue the perfection and priority of the security interest
granted hereby and by any Foreign Assignment Agreement (including (x) in the
case of any Foreign Purchased Loan (AU), upon the request of Buyer, executing a
legal or statutory mortgage in favour of Buyer over any real property or any
other form of security which Buyer reasonably considers appropriate for the
property to be subject to that security, each in form and substance reasonably
required by Buyer, and (y) marking its records and files to evidence the
interests granted to Buyer hereunder).

With respect to each Foreign Purchased Loan (AU), to the extent the law permits,
(a) for the purposes of section 115(1) and 115(7) of the PPSA, Buyer need not
comply with sections 95, 118, 121(4), 125, 130, 132(3)(d) or 132(4); and
sections 142 and 143 are excluded; (b) for the purposes of section 115(7) of the
PPSA, Buyer need not comply with sections 132 and 137(3); and (c) Parlex 2 AU
agrees not to exercise its rights to make any request of Buyer under section 275
of the PPSA, to authorise the disclosure of any information under that section
or to waive any duty of confidence that would otherwise permit non-disclosure
under that section.

 

7.

PAYMENT, TRANSFER AND CUSTODY

(a) On the Purchase Date for each Transaction, ownership of the Purchased Loans
shall be transferred to Buyer or its designee (including the Custodian) against
the simultaneous transfer of the Purchase Price to an account of Seller
specified in writing by Seller relating to such Transaction (and subject to the
last sentence of Section 17).

(b) On or before each Purchase Date, Seller shall deliver or cause to be
delivered to Buyer or its designee the Custodial Delivery in the form attached
hereto as Exhibit III; provided, that notwithstanding the foregoing, upon
request of Seller, Buyer in its sole discretion may elect to permit Seller to
make such delivery by not later than the third (3rd) Business Day (or, in the

 

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case of each Foreign Purchased Loan (AU), the tenth (10th) Business Day) after
the related Purchase Date, so long as Seller causes an Acceptable Attorney to
deliver to Buyer and the Custodian an Attorney’s Bailee Letter on or prior to
such Purchase Date. In connection with each sale, transfer, conveyance and
assignment of a Purchased Loan, on or prior to the Purchase Date with respect to
such Purchased Loan, Seller shall deliver or cause to be delivered and released
the following documents (collectively, the “Purchased Loan File”) pertaining to
such Purchased Loan to the Custodian on or prior to the Purchase Date (unless
otherwise waived by Buyer) with respect to such Purchased Loan (or, pursuant to
the proviso in the immediately preceding sentence, by not later than the third
(3rd) Business Day (or, in the case of each Foreign Purchased Loan (AU), the
tenth (10th) Business Day) after the related Purchase Date):

With respect to each Purchased Loan that is a Whole Loan or Senior Interest, to
the extent applicable:

 

  (i)

The original Mortgage Note (or senior Mortgage Note in an “A/B” structure),
bearing all intervening endorsements and/or assignments (including, with respect
to Foreign Purchased Loans, copies of all Transfer Certificates duly executed by
the relevant parties).

 

  (ii)

An original or copy of any loan agreement and any guarantee executed in
connection with the Mortgage Note.

 

  (iii)

An original or copy of the Mortgage with evidence of recordation, or submission
for recordation, from the appropriate governmental recording office of the
jurisdiction where the Mortgaged Property is located (or, in the case of a
Foreign Purchased Loan, with evidence of all filings, recordings, notifications
and/or regulations required under applicable Requirements of Law in the relevant
non-U.S. jurisdiction to perfect a valid first priority security in the
Mortgaged Property).

 

  (iv)

Originals or copies of all assumption, modification, consolidation or extension
agreements with evidence of recordation, or submission for recordation, from the
appropriate governmental recording office of the jurisdiction where the
Mortgaged Property is located (or, in the case of a Foreign Purchased Loan, with
evidence of all filings, recordings, notifications and/or registrations required
under applicable Requirements of Law in the relevant non-U.S. jurisdiction).

 

  (v)

An original of the Assignment Documents in Blank.

 

  (vi)

An original of the Foreign Assignment Agreement.

 

  (vii)

Originals or copies of all intervening assignments of mortgage with evidence of
recordation, or submission for recordation, from the appropriate governmental
recording office of the jurisdiction where the Mortgaged Property is located
(or, in the case of a Foreign Purchased Loan, with evidence of all filings,
recordings, notifications and/or regulations required under applicable
Requirements of Law in the relevant non-U.S. jurisdiction to perfect a valid
first priority security in the Mortgaged Property).

 

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  (viii)

Other than in the case of Foreign Purchased Loans (AU), an original or copy of
the attorney’s opinion of title and abstract of title or a copy of the mortgagee
title insurance policy, as applicable, or if the mortgagee title insurance
policy has not been issued, a copy of the irrevocable marked commitment to issue
the same (or irrevocable signed proforma policy).

 

  (ix)

An original or copy of any security agreement, chattel mortgage or equivalent
document executed in connection with the Purchased Loan and, together, in the
case of a Foreign Purchased Loan, with evidence of all filings, recordings,
notifications and/or registrations required under applicable Requirements of Law
in the relevant non-U.S. jurisdiction necessary to perfect a valid first
priority security interest in the relevant Mortgaged Property.

 

  (x)

Other than in the case of Foreign Purchased Loans (AU), an original or copy of
the assignment of leases and rents, if any, with evidence of recordation, or
submission for recordation, from the appropriate governmental recording office
of the jurisdiction where the Mortgaged Property is located (or, in the case of
a Foreign Purchased Loan, with evidence of all filings, recordings,
notifications and/or registrations required under applicable Requirements of Law
in the relevant non-U.S. jurisdiction necessary to perfect a valid first
priority security interest in the relevant Mortgaged Property).

 

  (xi)

Originals or copies of all intervening assignments of assignment of leases and
rents, if any, or copies thereof, with evidence of recordation, or submission
for recordation, from the appropriate governmental recording office of the
jurisdiction where the Mortgaged Property is located (or, in the case of a
Foreign Purchased Loan, with evidence of all filings, recordings, notifications
and/or registrations required under applicable Requirements of Law in the
relevant non-U.S. jurisdiction).

 

  (xii)

A copy of the UCC financing statements and all necessary UCC continuation
statements (or, with respect to Foreign Purchased Loans, their equivalent under
applicable Requirements of Law in the relevant non-U.S. jurisdiction) with
evidence of filing or submission for filing thereon, and UCC assignments (or,
with respect to Foreign Purchased Loans, their equivalent under applicable
Requirements of Law in the relevant non-U.S. jurisdiction) prepared by Seller in
blank, which UCC assignments or such equivalent shall be in form and substance
acceptable for filing.

 

  (xiii)

An environmental indemnity agreement (if any).

 

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  (xiv)

Mortgagor’s certificate or title affidavit (if any).

 

  (xv)

Other than in the case of Foreign Purchased Loans (AU), a Survey of the
Mortgaged Property (if any) as accepted by the title company for issuance of the
Title Policy (or, with respect to Foreign Purchased Loans, by Buyer).

 

  (xvi)

With respect to Foreign Purchased Loans, a Property Report and, an overview
thereon prepared by Seller’s (or, to the extent customary in the relevant
non-U.S. jurisdiction, the relevant Mortgagor’s) counsel addressed to or capable
of being relied on by Buyer or its designee upon registration of Buyer or its
designee, as lender of record (if available).

 

  (xvii)

A copy of the opinion of Mortgagor’s (or, with respect to any Foreign Purchased
Loan, to the extent customary in the relevant non-U.S. jurisdiction,
Mortgagee’s) counsel.

 

  (xviii)

An assignment of permits, contracts and agreements (if any).

With respect to each Purchased Loan which is a participation interest in a Whole
Loan or Senior Interest:

 

  (i)

the original or a copy of all of the documents described above with respect to a
Purchased Loan which is a whole mortgage loan;

 

  (ii)

if applicable, an original participation certificate bearing all intervening
endorsements;

 

  (iii)

an original or copy of any participation agreement and an original or copy of
any intercreditor agreement, co–lender agreement and/or servicing agreement
executed in connection with the Purchased Loan; and

 

  (iv)

An original of the Assignment Documents in Blank.

From time to time, Seller shall forward to the Custodian additional original
documents or additional documents evidencing any assumption, modification,
consolidation or extension of a Purchased Loan approved in accordance with the
terms of this Agreement, and upon receipt of any such other documents, the
Custodian shall hold such other documents as Buyer shall request from time to
time. With respect to any documents which have been delivered or are being
delivered to recording offices for recording and have not been returned to
Seller in time to permit their delivery hereunder at the time required, in lieu
of delivering such original documents, Seller shall deliver to Buyer a true copy
thereof with an officer’s certificate certifying that such copy is a true,
correct and complete copy of the original, which has been transmitted for
recordation. Seller shall deliver such original documents to the Custodian
promptly when they are received. With respect to all of the Purchased Loans
delivered by Seller to Buyer or its designee (including the Custodian), Seller
shall execute an omnibus power of attorney substantially in the form of Exhibit
V-A or Exhibit V-B attached hereto, as applicable, irrevocably appointing Buyer
or its

 

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designee its attorney-in-fact with full power during the occurrence and
continuance of an Event of Default and, subject to the following sentence,
during the occurrence and continuance of a monetary Default or material
non-monetary Default, to take the actions described therein, on the terms and
conditions set forth therein. If a monetary Default or a material non-monetary
Default has occurred and is continuing and Buyer has requested in writing that
Seller take or cause to be taken any action that Buyer deems reasonably
necessary to preserve Buyer’s or its designee’s ability to enforce upon the
Purchased Loans as and when permitted pursuant to Section 14(b) hereof (which
writing shall include a statement that Buyer will exercise its power of attorney
if Seller fails to take or cause to be taken such action requested by Buyer),
and Seller has not complied with any such request promptly following receipt
thereof, then Buyer (or its designee) may exercise its power of attorney during
the existence and continuation of any such monetary Default or material
non-monetary Default, as the case may be, as Buyer deems reasonably necessary to
preserve Buyer’s or its designee’s ability to enforce upon the Purchased Loans
as and when permitted pursuant to Section 14(b) hereof. Buyer shall deposit the
Purchased Loan Files representing the Purchased Loans, or direct that the
Purchased Loan Files be deposited directly, with the Custodian. The Purchased
Loan Files shall be maintained in accordance with the applicable Custodial
Agreement. Any Purchased Loan Files not delivered to Buyer or its designee
(including the Custodian) are and shall be held in trust by Seller or its
designee for the benefit of Buyer as the owner thereof. Seller or its designee
shall maintain a copy of the Purchased Loan File and the originals of the
Purchased Loan File not delivered to Buyer or its designee (to the extent such
originals are in the possession or control of the Seller). The possession of the
Purchased Loan File by Seller or its designee, is at the will of Buyer for the
sole purpose of servicing the related Purchased Loan, and such retention and
possession by Seller or its designee is in a custodial capacity only. The books
and records (including, without limitation, any computer records or tapes) of
Seller or its designee shall be marked appropriately to reflect clearly the sale
of the related Purchased Loan to Buyer. Seller or its designee (including the
Custodian) shall release its custody of the Purchased Loan File only in
accordance with written instructions from Buyer, unless such release is required
as incidental to the servicing of the Purchased Loans, is in connection with a
repurchase of any Purchased Loan by Seller or as otherwise required by law.

(c) Unless an Event of Default shall have occurred and be continuing, Buyer
and/or its designee shall exercise all voting and corporate rights with respect
to the Purchased Loans in accordance with Seller’s written instructions;
provided, however, that Buyer and/or its designee, shall not be required to
follow Seller’s instructions concerning any vote or corporate right if doing so
would, in Buyer’s Applicable Standard of Discretion and in a manner consistent
with Buyer’s other master repurchase facilities for comparable assets, be
inconsistent with or result in any violation of any provision of the Transaction
Documents or any Requirement of Law. The rights of Buyer as described in
Section 3.07 of the Servicing Agreement in relation to the consideration of and
provision to the Servicer of any consents, authorizations, directions and/or
instructions shall constitute the exercise of voting and corporate rights with
respect to the Purchased Loans for the purpose of this Section 7(c). Upon the
occurrence and during the continuation of an Event of Default, Buyer and/or its
designee, shall be entitled to exercise all voting and corporate rights with
respect to the Purchased Loans without regard to Seller’s instructions.

 

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8.

SALE, TRANSFER, HYPOTHECATION OR PLEDGE OF PURCHASED LOANS

(a) Title to all Purchased Loans shall pass to Buyer (or its designee) on the
applicable Purchase Date, and Buyer (or its designee) shall have free and
unrestricted use of all Purchased Loans, subject however, to the terms of this
Agreement. Nothing in this Agreement or any other Transaction Document shall
preclude Buyer (or its designee) from engaging in repurchase transactions with
the Purchased Loans or otherwise selling, transferring, pledging, repledging,
hypothecating, or rehypothecating the Purchased Loans, but no such transaction
shall relieve Buyer of its obligations to transfer the Purchased Loans to Seller
pursuant to Section 3 of this Agreement, of Buyer’s obligation to credit or pay
Income to, or apply Income to the obligations of, Seller pursuant to Section 5
hereof or of Buyer’s obligations pursuant to Section 19(b).

(b) Nothing contained in this Agreement or any other Transaction Document shall
obligate Buyer to segregate any Purchased Loans delivered to Buyer (or its
designee) by Seller. Notwithstanding anything to the contrary in this Agreement
or any other Transaction Document, no Purchased Loan shall remain in the custody
of Seller or an Affiliate of Seller.

 

9.

INTENTIONALLY OMITTED

 

10.

REPRESENTATIONS

(a) Each of Buyer and Seller represents and warrants to the other that (i) it is
duly authorized to execute and deliver this Agreement, to enter into
Transactions contemplated hereunder and to perform its obligations hereunder and
has taken all necessary action to authorize such execution, delivery and
performance, (ii) it will engage in such Transactions as principal (or, if
agreed in writing, in the form of an annex hereto or otherwise, in advance of
any Transaction by the other party hereto, as agent for a disclosed principal),
(iii) the person signing this Agreement on its behalf is duly authorized to do
so on its behalf (or on behalf of any such disclosed principal), (iv) it has
obtained all authorizations of any governmental body required in connection with
this Agreement and the Transactions hereunder and such authorizations are in
full force and effect and (v) the execution, delivery and performance of this
Agreement and the Transactions hereunder will not violate any law, ordinance or
rule applicable to it or its organizational documents or any agreement by which
it is bound or by which any of its assets are affected.

(b) In addition to the representations and warranties in subsection (a) above,
Seller represents and warrants to Buyer that as of the date of this Agreement,
as of the Purchase Date for the purchase of any Purchased Loans by Buyer from
Seller and any Transaction thereunder, as of any Business Day on which Margin
Excess is made available by Buyer to Seller, and at all times while this
Agreement and any Transaction thereunder is in full force and effect:

 

  (i)

Organization. Seller is duly formed, validly existing and in good standing under
the laws and regulations of the state of Seller’s formation and is duly
licensed, qualified, and in good standing in every jurisdiction where such
licensing or qualification is necessary for the transaction of Seller’s
business. Seller has the power to own and hold the assets it purports to own and
hold, and to carry on its business as now being conducted and proposed to be
conducted, and has the power to execute, deliver, and perform its obligations
under this Agreement and the other Transaction Documents.

 

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  (ii)

Due Execution; Enforceability. The Transaction Documents have been or will be
duly executed and delivered by Seller. The Transaction Documents constitute the
legal, valid and binding obligations of Seller, enforceable against Seller in
accordance with their respective terms subject to bankruptcy, insolvency, court
schemes, moratoria, administration, examinership, reorganisation and other
limitations on creditors’ rights generally and to equitable principles.

 

  (iii)

Non-Contravention. Neither the execution and delivery of the Transaction
Documents, nor consummation by Seller of the transactions contemplated by the
Transaction Documents (or any of them), nor compliance by Seller with the terms,
conditions and provisions of the Transaction Documents (or any of them) will
conflict with or result in a breach of any of the terms or provisions of (i) the
organizational documents of Seller, (ii) any contractual obligation to which
Seller is now a party or the rights under which have been assigned to Seller or
the obligations under which have been assumed by Seller or to which the assets
of Seller are subject or constitute a default thereunder, or result thereunder
in the creation or imposition of any lien upon any of the assets of Seller,
other than pursuant to the Transaction Documents, (iii) any judgment or order,
writ, injunction, decree or demand of any court applicable to Seller, or
(iv) any applicable Requirement of Law, in the case of clauses (ii)-(iv) above,
to the extent that such conflict or breach would have a Material Adverse Effect.
Seller has all necessary licenses, permits and other consents from Governmental
Authorities necessary to acquire, own and sell the Purchased Loans and for the
performance of its obligations under the Transaction Documents, except to the
extent failure to have such licenses, permits and consents is not reasonably
likely to have a Material Adverse Effect.

 

  (iv)

Litigation; Requirements of Law. Except as disclosed in writing to Buyer, there
is no action, suit, proceeding, investigation, or arbitration pending or, to
Seller’s Actual Knowledge, threatened in writing against Seller or any of its
assets, which is reasonably likely to have a Material Adverse Effect. Seller is
in compliance in all material respects with all Requirements of Law. Seller is
not in default in any material respect with respect to any judgment, order,
writ, injunction, decree, rule or regulation of any arbitrator or Governmental
Authority.

 

  (v)

No Broker. Seller has not dealt with any broker, investment banker, agent, or
other Person (other than Buyer or an Affiliate of Buyer) who may be entitled to
any commission or compensation in connection with the sale of Purchased Loans
pursuant to any of the Transaction Documents.

 

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  (vi)

Good Title to Purchased Loans. Immediately prior to the purchase of any
Purchased Loans by Buyer from Seller, such Purchased Loans are free and clear of
any lien, encumbrance or impediment to transfer (including any “adverse claim”
as defined in Section 8-102(a)(1) of the UCC), and Seller is the record and
beneficial owner of and has good and marketable title to and the right to sell
and transfer such Purchased Loans to Buyer and, upon transfer of such Purchased
Loans to Buyer, Buyer shall be the owner of such Purchased Loans free of any
adverse claim, subject to the rights of Seller and other obligations of Buyer
pursuant to the terms of this Agreement. In the event the related Transaction is
recharacterized as a secured financing of the Purchased Loans, the provisions of
this Agreement (together, with respect to any Foreign Purchased Loan, with the
relevant Foreign Assignment Agreement) are effective to create in favor of Buyer
a valid security interest in all rights, title and interest of Seller in, to and
under the Collateral and Buyer shall have a valid, perfected first priority
security interest in the Purchased Loans.

 

  (vii)

No Default. As of the date of this Agreement and each Purchase Date, no Default
or Event of Default has occurred and is continuing under or with respect to the
Transaction Documents. At all times while this Agreement and any Transaction
thereunder is in effect, no monetary Default, material non-monetary Default or
Event of Default to Seller’s Actual Knowledge has occurred and is continuing
under or with respect to the Transaction Documents.

 

  (viii)

Representations and Warranties Regarding Purchased Loans; Delivery of Purchased
Loan File. Seller represents and warrants to Buyer that each Purchased Loan sold
in a Transaction hereunder, as of the related Purchase Date for such Transaction
and as of any Business Day on which Margin Excess is made available by Buyer to
Seller which increases the outstanding Purchase Price of such Purchased Loan,
conforms to the applicable representations and warranties set forth in Exhibit
VI-I, Exhibit VI-II and Exhibit VI-III attached hereto in all material respects,
except as disclosed to Buyer in writing. With respect to each Purchased Loan,
the Mortgage Note, the Mortgage, the Assignment of Mortgage, the Transfer
Certificate and any other documents required to be delivered under this
Agreement and the applicable Custodial Agreement for such Purchased Loan have
been delivered to Buyer or the Custodian on its behalf (or shall be delivered in
accordance with the time periods set forth herein).

 

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  (ix)

Adequate Capitalization; No Fraudulent Transfer. Seller is generally able to
pay, and as of the date hereof is paying, its debts as they come due. Seller has
not become, and is not presently, financially insolvent nor will Seller be made
insolvent by virtue of Seller’s execution of or performance under any of the
Transaction Documents within the meaning of the bankruptcy laws or the
insolvency laws of any jurisdiction. Seller has not entered into any Transaction
Document or any Transaction pursuant thereto in contemplation of insolvency or
with intent to hinder, delay or defraud any creditor. Seller has not received
any written notice that any payment or other transfer made to or on account of
Seller from or on account of any Mortgagor or any other person obligated under
any Purchased Loan Documents is or may be void or voidable as an actual or
constructive fraudulent transfer or as a preferential transfer.

 

  (x)

Consents. No consent, approval or other action of, or filing by Seller with, any
Governmental Authority or any other Person is required to authorize, or is
otherwise required in connection with, the execution, delivery and performance
of any of the Transaction Documents (other than consents, approvals and filings
that have been obtained or made, as applicable, or that, if not obtained or
made, are not reasonably likely to have a Material Adverse Effect).

 

  (xi)

Members. Seller is a wholly owned subsidiary of Guarantor.

 

  (xii)

Organizational Documents. Seller has delivered to Buyer certified copies of its
organizational documents, together with all amendments thereto, if any.

 

  (xiii)

No Encumbrances. Except to the extent expressly set forth in this Agreement,
there are (i) no outstanding rights, options, warrants or agreements on the part
of Seller for a purchase, sale or issuance, in connection with the Purchased
Loans, (ii) no agreements on the part of Seller to issue, sell or distribute the
Purchased Loans, and (iii) no obligations on the part of Seller (contingent or
otherwise) to purchase, redeem or otherwise acquire any securities or any
interest therein or to pay any dividend or make any distribution in respect of
the Purchased Loans.

 

  (xiv)

Federal Regulations. Seller is not (A) required to register as an “investment
company,” or a company “controlled by an investment company,” within the meaning
of the Investment Company Act of 1940, as amended, or (B) a “holding company,”
or a “subsidiary company of a holding company,” or an “affiliate” of either a
“holding company” or a “subsidiary company of a holding company,” as such terms
are defined in the Public Utility Holding Company Act of 1935, as amended.

 

  (xv)

Taxes. Seller and Guarantor have filed or caused to be filed all federal and
other material tax returns which are required to be filed with respect to Seller
and have paid all federal and other material taxes imposed on or with respect to
Seller except for any such taxes as are being appropriately contested in good
faith by appropriate proceedings diligently conducted and with respect to which
adequate reserves have been provided in accordance with GAAP; no tax liens have
been filed against Seller or its assets (except for Permitted Liens).

 

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  (xvi)

ERISA. Neither Seller nor any ERISA Affiliate maintains any Plans and neither
Seller nor any ERISA Affiliate and makes any contributions to any Plans or any
Multiemployer Plans.

 

  (xvii)

Judgments/Bankruptcy. Except as disclosed in writing to Buyer, there are no
judgments against Seller unsatisfied of record or docketed in any court located
in the United States of America. No Act of Insolvency has ever occurred with
respect to Seller.

 

  (xviii)

Full and Accurate Disclosure. No information contained in the Transaction
Documents or in any written statement prepared and delivered by Seller or
Guarantor pursuant to the terms of the Transaction Documents contains any untrue
statement of a material fact or omits to state a material fact necessary to make
the statements contained herein or therein not misleading in light of the
circumstances under which they were made when such statements and omissions are
considered in the totality of the circumstances in question.

 

  (xix)

Financial Information. All financial data concerning Seller and Guarantor that
has been delivered by Seller to Buyer is true, complete and correct in all
material respects and has been prepared in accordance with GAAP. To Seller’s
Actual Knowledge, all financial data concerning the Purchased Loans that has
been delivered by or on behalf of Seller to Buyer is true, complete and correct
in all material respects. Since the delivery of such data, except as otherwise
disclosed in writing to Buyer, there has been no change in the financial
position of Seller and Guarantor or in the operations of Seller and Guarantor
or, to Seller’s Actual Knowledge, the financial position of the Purchased Loans,
which change is reasonably likely to have in a Material Adverse Effect.

 

  (xx)

Notice Address; Jurisdiction of Organization. On the date of this Agreement,
Seller’s address for notices is as set forth in Annex I. Seller’s jurisdiction
of organization is Delaware. The location where Seller keeps its books and
records, including all computer tapes and records relating to the Collateral, is
its notice address.

 

  (xxi)

Prohibited Person. None of Seller, Guarantor or any of their respective
Affiliates is a Prohibited Person and each of Seller and Guarantor is in full
compliance with all applicable orders, rules, regulations and recommendations of
OFAC and each Foreign Sanctions Authority. None of Seller or Guarantor or any of
their respective members, directors, executive officers, parents or
Subsidiaries, as applicable: (A) are subject to U.S. or multilateral economic or
trade sanctions currently in force; (B) are

 

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  owned or controlled by, or act on behalf of, any governments, corporations,
entities or individuals that are subject to U.S. or multilateral economic or
trade sanctions currently in force; or (C) is a Prohibited Person or is
otherwise named, identified or described on any blocked persons list, designated
nationals list, denied persons list, entity list, debarred party list,
unverified list, sanctions list or other list of individuals or entities with
whom U.S. persons may not conduct business, including but not limited to lists
published or maintained by OFAC, the U.S. Department of Commerce, the U.S.
Department of State and any Foreign Sanctions Authority. Each of Seller and
Guarantor has established an anti-money laundering compliance program as
required by all applicable anti-money laundering laws and regulations, including
without limitation the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001
(Public Law 107-56).

 

  (xxii)

Centre of Main Interests. Seller has not (A) taken any action that would cause
its “centre of main interests” (as such term is used in Section 3(1) of the
Regulation (EU) No. 2015/848 on Insolvency Proceedings (the “Recast Insolvency
Regulation”)) to be located in the United Kingdom or Europe or (B) registered as
a company in any jurisdiction other than Delaware.

 

11.

NEGATIVE COVENANTS OF SELLER

On and as of the date hereof and until this Agreement is no longer in force with
respect to any Transaction, Seller shall not without the prior written consent
of Buyer:

(a) subject to Seller’s right to repurchase any Purchased Loan, take any action
which would directly or indirectly impair or adversely affect Buyer’s title to
the Purchased Loans;

(b) transfer, assign, convey, grant, bargain, sell, set over, deliver or
otherwise dispose of, or pledge or hypothecate, directly or indirectly, any
interest in the Purchased Loans (or any of them) to any Person other than Buyer,
or engage in repurchase transactions or similar transactions with respect to the
Purchased Loans (or any of them) with any Person other than Buyer, unless and
until such Purchased Loans are repurchased by Seller in accordance with this
Agreement;

(c) create, incur or permit to exist any Lien in or on the Purchased Loans,
except as described in Section 6 of this Agreement;

(d) create, incur or permit to exist any lien, encumbrance or security interest
in or on any of the other Collateral subject to the security interest granted by
Seller pursuant to Section 6 of this Agreement;

 

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(e) modify or terminate any of the organizational documents of Seller (except
Buyer shall not unreasonably withhold or delay any request for a consent to such
modification to the organizational documents (excluding the special purpose
entity provisions));

(f) consent to any amendment or supplement to, or termination of any note, loan
agreement, mortgage or guaranty relating to the Purchased Loans or other
material agreement or instrument relating to the Purchased Loans (other than
Permitted Purchased Loan Modifications), unless and until such Purchased Loans
are repurchased by Seller in accordance with this Agreement; provided, that
notwithstanding the foregoing, to the extent Buyer’s prior approval is required
for any such amendment or termination set forth in this Section 11(f) and Seller
delivers a written request for approval to Buyer which is not responded to
within five (5) Business Days, then Buyer shall be deemed to have granted its
approval to such amendment or termination if Seller proceeds to deliver to Buyer
a second written request for approval which is not responded to within five
(5) Business Days, so long as such second request is marked in bold lettering
with the following language: “BUYER’S RESPONSE IS REQUIRED WITHIN FIVE
(5) BUSINESS DAYS OF RECEIPT OF THIS NOTICE PURSUANT TO THE TERMS OF A
REPURCHASE AGREEMENT BETWEEN THE UNDERSIGNED AND BUYER” and the envelope
containing the request must be marked “PRIORITY”;

(g) admit any additional members in Seller, or permit the sole member of Seller
to assign or transfer all or any portion of its membership interest in Seller;

(h) enter into any Hedging Transactions other than to the extent required under
Section 12(e) (it being understood and agreed Seller shall not have any
obligation to enter into Hedging Transactions with respect to individual
Purchased Loans or pursue hedging strategies at the level of Seller with respect
to the Purchased Loans);

(i) after the occurrence and during the continuation of an Event of Default,
make any distribution, payment on account of, or set apart assets for, a sinking
or other analogous fund for the purchase, redemption, defeasance, retirement or
other acquisition of any Capital Stock of Seller, whether now or hereafter
outstanding, or make any other distribution in respect thereof, either directly
or indirectly, whether in cash or property or in obligations of Seller; or

(h) take any action that will cause its “centre of main interests” (as such term
is used in the Recast Insolvency Regulation) to be located in the United Kingdom
or Europe or register as a company in any jurisdiction other than Delaware.

 

12.

AFFIRMATIVE COVENANTS OF SELLER

(a) Seller shall use commercially reasonable efforts to promptly notify Buyer of
any change in its business operations and/or financial condition that would be
reasonably likely to have a Material Adverse Effect; provided, however, the
failure to deliver such notice in accordance with this Section 12(a) shall not
give rise to an Event of Default; provided, further, that nothing in this
Section 12 shall relieve Seller of its obligations under this Agreement.

 

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(b) Seller shall provide Buyer with copies of such documents as Buyer may
reasonably request and which are in Seller’s possession or control evidencing
the truthfulness of the representations set forth in Section 10.

(c) Seller (1) shall defend the right, title and interest of Buyer in and to the
Collateral against, and take such other action as is necessary to remove, the
Liens of all Persons (other than security interests by or through Buyer and
Permitted Liens) and (2) shall, at Buyer’s reasonable request, take all action
necessary to ensure that Buyer will have a first priority security interest in
the Purchased Loans subject to any of the Transactions in the event such
Transactions are recharacterized as secured financings (including, in the case
of any Foreign Purchased Loan (AU), upon the request of Buyer, executing a legal
or statutory mortgage in favour of Buyer over any real property or any other
form of security which Buyer reasonably considers appropriate for the property
to be subject to that security, each in form and substance reasonably required
by Buyer).

(d) Seller shall notify Buyer and the Depository of the occurrence of any
Default or Event of Default of which Seller has written notice or Actual
Knowledge and which has not otherwise been disclosed pursuant to the reports
delivered in accordance with Section 12(i).

(e) With respect to each fixed rate Purchased Loan, Seller shall enter into
Hedging Transactions designed to mitigate interest rate risk (i.e. not credit
risk) pursuant to a hedging strategy reasonably acceptable to Buyer and pledge
such Hedging Transactions to Buyer as Collateral (including, without limitation,
to the extent such Hedging Transactions are entered into with a party other than
Buyer, delivering a collateral assignment of such Hedging Transactions in form
and substance acceptable to Buyer). Seller acknowledges Buyer will mark to
market such Hedging Transactions from time to time in accordance with and
subject to the terms of this Agreement.

(f) Seller shall promptly (and in any event not later than three (3) Business
Days following receipt) deliver to Buyer (i) any written notice of the
occurrence of an event of default received by Seller pursuant to the Purchased
Loan Documents and (ii) any other information with respect to the Purchased
Loans within Seller’s possession or control as may be reasonably requested by
Buyer from time to time.

(g) Seller will permit Buyer or its designated representative to inspect at
Buyer’s sole cost and expense (so long as an Event of Default has not occurred
and is not continuing) Seller’s records which are not privileged or confidential
(but excluding for this purpose all information received from Mortgagors or
other obligors on the Purchased Loans) and the conduct and operation of its
business related thereto upon reasonable prior written notice from Buyer or its
designated representative, at such reasonable times and with reasonable
frequency (not to exceed twice per calendar year, so long as an Event of Default
has not occurred and is not continuing), subject to the terms of any
confidentiality agreement between Buyer and Seller and applicable law, and if no
such confidentiality agreement then exists between Buyer and Seller, Buyer and
Seller shall act in accordance with customary market standards regarding
confidentiality and applicable law. Buyer shall act in a commercially reasonable
manner in requesting and conducting any inspection relating to the conduct and
operation of Seller’s business.

 

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(h) At any time from time to time upon the reasonable request of Buyer, at the
sole expense of Seller, Seller will promptly and duly execute and deliver such
further instruments and documents and take such further actions as Buyer may
reasonably request for the purposes of obtaining or preserving the full benefits
of this Agreement including the first priority security interest granted
hereunder and of the rights and powers herein granted (including, among other
things, filing such UCC financing statements or their equivalent under
applicable Requirements of Law in any relevant non-U.S. jurisdiction as Buyer
may reasonably request). If any amount payable under or in connection with any
of the Collateral shall be or become evidenced by any promissory note, other
instrument or chattel paper, such note, instrument or chattel paper shall be
immediately delivered to Buyer, duly endorsed in a manner reasonably
satisfactory to Buyer, to be held as Collateral pursuant to this Agreement, and
the documents delivered in connection herewith.

(i) Seller shall provide Buyer with the following financial and reporting
information:

 

  (i)

Within 45 days after the last day of each of the first three fiscal quarters in
any fiscal year, Guarantor’s and (to the extent prepared separately from
Guarantor) Seller’s unaudited consolidated balance sheets as of the end of such
quarter, in each case certified as being true and correct by an officer’s
certificate;

 

  (ii)

Within 90 days after the last day of its fiscal year, Guarantor’s audited and
(to the extent prepared separately from Guarantor) Seller’s unaudited (or, if
generated by Seller, Seller’s audited) consolidated statements of income and
statements of changes in cash flow for such year and balance sheets as of the
end of such year, in each case presented fairly in accordance with GAAP, and
accompanied, in the case of Guarantor, by an unqualified report of a nationally
recognized independent certified public accounting firm, Deloitte & Touche LLP
or any other accounting firm consented to by Buyer in its reasonable discretion;

 

  (iii)

Within 30 days after the last day of each calendar month, any and all property
level financial information (including, without limitation, operating and
financial statements) with respect to the Purchased Loans that was received
during the preceding calendar month and is in the possession of Seller or an
Affiliate, including, without limitation, rent rolls and income statements;

 

  (iv)

Within 30 days after the last day of each calendar quarter in any fiscal year,
an officer’s certificate from Seller addressed to Buyer certifying that, as of
such calendar month, (x) Seller and Guarantor are in compliance in all material
respects with all of the terms and requirements of this Agreement, (y) Guarantor
is in compliance with the financial covenants set forth in the Guaranty
(including therein detailed calculations demonstrating such compliance) and
(z) no Event of Default has occurred and is continuing; and

 

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  (v)

With respect to the Purchased Loans and related Mortgaged Properties: (x) within
30 days after the last day of each calendar month, Seller’s monthly operations
report covering occupancy, collections, delinquencies, losses, recoveries, cash
flows and such other property level information as may reasonably be requested
by Buyer and (y) within 30 days after the last day of each calendar quarter in
any fiscal year, an asset management report prepared by Seller or Guarantor.

(j) Seller shall at all times comply with all laws, ordinances, rules and
regulations of any federal, state, municipal or other public authority having
jurisdiction over Seller or any of its assets, except to the extent any failure
thereof is not reasonably likely to result in a Material Adverse Effect. Seller
shall do or cause to be done all things reasonably necessary to preserve and
maintain in full force and effect its legal existence, and all licenses material
to its business.

(k) Seller shall at all times keep proper books of records and accounts in which
full, true and correct entries shall be made of its transactions in accordance
with GAAP and set aside on its books from its earnings for each fiscal year all
such proper reserves in accordance with GAAP.

(l) Seller shall observe, perform and satisfy all the terms, provisions and
covenants required to be observed, performed or satisfied by it, and shall pay
when due all costs, fees and expenses required to be paid by it, under the
Transaction Documents. Seller shall pay and discharge all Taxes, levies, liens
and other charges on its assets and on the Collateral that, in each case, in any
manner would create any Lien upon the Collateral, except for Permitted Liens or
similar charges.

(m) Seller will maintain records with respect to the Collateral and the conduct
and operation of its business with no less a degree of prudence than if the
Collateral were held by Seller for its own account.

(n) In the event that Guarantor terminates BXMT Advisors L.L.C. as Guarantor’s
external manager pursuant to the Second Amended and Restated Management
Agreement, dated as of October 23, 2014, between Guarantor and BXMT Advisors
L.L.C., any replacement external manager or switch to internal management shall
be subject to Buyer’s prior written approval, not to be unreasonably withheld,
conditioned or delayed.

 

13.

SINGLE-PURPOSE ENTITY

Seller hereby represents and warrants to Buyer, and covenants with Buyer, that
as of the date hereof and so long as any of the Transaction Documents shall
remain in effect:

(a) It is and intends to remain Solvent and it has paid and will pay its debts
and liabilities (including employment and overhead expenses) from and solely to
the extent of its own assets as the same shall become due.

(b) It has complied and will comply with the provisions of its organizational
documents (i.e. certificate of formation and operating agreement) in all
material respects.

 

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(c) It has done or caused to be done and will, to the extent under its control,
do all things necessary to observe corporate formalities and to preserve its
existence.

(d) It has maintained and will maintain all of its books, records, financial
statements and bank accounts separate from those of its Affiliates, its members
and any other Person (except, in each case, to the extent consolidation is
permitted under GAAP or as a matter of law), and, to the extent required by law,
it will file its own tax returns, if any (except, for the avoidance of doubt, if
Seller is included as part of a consolidated, unitary, combined or similar tax
return, or if Seller is disregarded as a separate entity for applicable tax
purposes).

(e) It has been, is and will be, and at all times will hold itself out to the
public as, a legal entity separate and distinct from any other entity (including
any Affiliate), shall correct any misunderstanding of which it has Actual
Knowledge regarding its status as a separate entity, shall conduct business in
its own name, shall not identify itself or any of its Affiliates as a division
or part of the other, shall maintain and utilize separate stationery, invoices
and checks, and allocate fairly and reasonably any overhead for shared office
space and for services performed by an employee of an Affiliate.

(f) It has not owned and will not own any property or any other assets other
than Purchased Loans, assets intended to be offered as Eligible Loans pursuant
to this Agreement, cash and its interest under any associated Hedging
Transactions; provided, however, that Seller shall not be in breach of this
provision to the extent that Seller acquires or originates an Eligible Loan
under its good faith belief that such Eligible Loan will become a Purchased
Loan; provided, further, that in the event Buyer does not approve such Eligible
Loan for inclusion in a Transaction after Buyer’s receipt of the applicable
Transaction Request, Due Diligence Package and such additional diligence
materials in accordance with Section 3(a), then Seller shall convey all of its
right, title and interest in such Eligible Loan to a third party by not later
than ten (10) Business Days after Buyer disapproves (or is deemed to have
disapproved) such Eligible Loan in accordance with Section 3(a).

(g) It has not engaged and will not engage in any business other than the
acquisition, origination, ownership, servicing, enforcement, financing and
disposition of Purchased Loans in accordance with the applicable provisions of
the Transaction Documents and its organizational documents.

(h) It has not entered into, and will not enter into, any contract or agreement
with any of its Affiliates, except upon terms and conditions that are
substantially similar to those that would be available on an arm’s-length basis
with Persons other than such Affiliate.

(i) It has not incurred and will not incur any Indebtedness or other obligation,
secured or unsecured, direct or indirect, absolute or contingent (including
guaranteeing any obligation), other than (A) with respect to the Purchased Loan
Documents, and (B) trade payables in the ordinary course of its business which
are either (x) no more than ninety (90) days past due and do not exceed
$500,000.00 in the aggregate or (y) more than ninety (90) days past due and do
not exceed $250,000.00 in the aggregate, and are being contested in good faith
and for which adequate reserves are maintained, and (C) as otherwise expressly
permitted under this Agreement.

 

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(j) It has not made and will not make any loans or advances to any other Person,
except as permitted under this Agreement and under assets intended to be offered
as Eligible Loans pursuant to this Agreement (subject to the provisos to
Section 12(f) herein), and shall not acquire obligations or securities of any
member or any Affiliate of any member or any other Person.

(k) It will maintain adequate capital derived from income from its business
operations for the normal obligations reasonably foreseeable in a business of
its size and character and in light of its contemplated business operations.

(l) It shall not seek its dissolution, liquidation or winding up, in whole or in
part, or suffer any Change of Control or consolidation or merger with respect to
Seller.

(m) It will not commingle its funds and other assets with those of any of its
Affiliates or any other Person.

(n) It has maintained and will maintain its assets in such a manner that it will
not be costly or difficult to segregate, ascertain or identify its individual
assets from those of any of its Affiliates or any other Person.

(o) Except as expressly permitted under this Agreement, it has not held and will
not hold itself out to be responsible for the debts or obligations of any other
Person.

(p) Seller shall not take any Act of Insolvency without the affirmative vote of
the Independent Director.

(q) It shall at all times maintain at least one Independent Director. For so
long as the Repurchase Obligations remain outstanding, Seller shall not take any
of the actions contemplated by Section 13(p) above (including, to the extent,
applicable without the affirmative vote of such Independent Director).

(r) It shall not pledge its assets to secure the obligations of any other
Person.

 

14.

EVENTS OF DEFAULT; REMEDIES

(a) After the occurrence and during the continuance of an Event of Default,
Seller hereby appoints Buyer as attorney-in-fact of Seller in accordance with
Section 7(b) for the purpose of carrying out the provisions of this Agreement
and taking any action and executing or endorsing any instruments that Buyer may
deem necessary or advisable to accomplish the purposes hereof, which appointment
as attorney-in-fact is irrevocable and coupled with an interest. With respect to
each Transaction, each of the following clauses (i) through (xv) shall be an
Event of Default under this Agreement:

 

  (i)

Seller fails to repurchase the Purchased Loans upon the applicable Repurchase
Date;

 

  (ii)

Seller fails to cure a Margin Deficit in accordance with Section 4 hereof;

 

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  (iii)

an Act of Insolvency occurs with respect to Seller or Guarantor;

 

  (iv)

Guarantor fails to qualify as a REIT (after giving effect to any cure or
corrective periods or allowances pursuant to the Code);

 

  (v)

either (A) the Transaction Documents shall for any reason not cause, or shall
cease to cause, Buyer (or its designee) to be the owner free of any adverse
claim of any of the Purchased Loans, or (B) if a Transaction is recharacterized
as a secured financing, the Transaction Documents with respect to any
Transaction shall for any reason cease to create a valid first priority security
interest in favor of Buyer (or its designee) in any of the Purchased Loans;

 

  (vi)

if an event occurs which would constitute (a) an “event of default” under any
Hedging Transaction or (b) a “termination event” or an “additional termination
event” under any Hedging Transaction (and, in either case, Seller has failed to
cure the “event of default” within the applicable cure period or to meet its
obligation to pay the Early Termination Amount, if any, pursuant to the terms of
such Hedging Transaction);

 

  (vii)

failure of Buyer to receive within one (1) Business Day after any Remittance
Date the accreted value of the Price Differential (less any amount of such Price
Differential previously paid by Seller to Buyer);

 

  (viii)

failure of Seller to make any other payment owing to Buyer which has become due,
whether by acceleration or otherwise under the terms of this Agreement (other
than due to any act or failure to act of Depository to the extent available
funds are on deposit in the applicable Cash Management Account), which failure
is not remedied within three (3) Business Days after written notice thereof to
Seller from Buyer;

 

  (ix)

any Governmental Authority takes any action to (i) condemn, seize or
appropriate, or assume custody or control of, all or any substantial part of the
property of Seller, (ii) displace the management of Seller or curtail its
authority in the conduct of the business of Seller, or (iii) terminate the
activities of Seller as contemplated by the Transaction Documents;

 

  (x)

a Change of Control shall have occurred;

 

  (xi)

any representation (other than a MTM Representation) made by Seller or Guarantor
in any Transaction Document shall have been incorrect or untrue in any material
respect when made or repeated or deemed to have been made or repeated and such
incorrect or untrue representation exists and continues unremedied for ten
(10) Business Days after the earlier of receipt of written notice thereof from
Buyer or Seller’s acquiring Actual Knowledge of such incorrect or untrue
representation (other than the representations and warranties set forth in
Section 10(b)(viii) of this

 

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Agreement made by Seller, which shall not be considered an Event of Default if
incorrect or untrue in any material respect, provided Seller repurchases the
related Purchased Loan on an Early Repurchase Date no later than three
(3) Business Days after receiving notice of such incorrect or untrue
representation and terminates the related Transaction; provided further Seller
shall not have made any such representation with actual knowledge that it was
materially incorrect or untrue at the time made);

 

  (xii)

(i) Guarantor breaches any of the payment obligations set forth in the Guaranty
or (ii) Guarantor shall fail to observe any of the financial covenants set forth
in the Guaranty or (iii) shall have defaulted or failed to perform any of the
other obligations under the Guaranty in any material respect and such default or
failure referred to in this clause (iii) remains uncured for a period of seven
(7) Business Days after the earlier of receipt of notice thereof from Buyer or
Seller’s acquiring Actual Knowledge of such default or failure by Guarantor;

 

  (xiii)

a final non-appealable judgment by any competent court in the United States of
America for the payment of money in an amount greater than $100,000 (in the case
of Seller) or $5,000,000 (in the case of the Guarantor) shall have been rendered
against Seller or Guarantor, and remains undischarged or unpaid for a period of
forty-five (45) days, during which period execution of such judgment is stayed
by the posting of cash or a bond or other collateral acceptable to Buyer in the
amount of the judgment;

 

  (xiv)

Seller or Guarantor shall have (x) defaulted under any note, indenture, loan
agreement, guaranty or other Indebtedness to which it is a party, which default
(A) involves the failure to pay a matured obligation in excess of $100,000 (in
the case of Seller) or the greater of (a) $5,000,000 or (b) the lesser of (i) 5%
of Tangible Net Worth (as such term is defined in the Guaranty) and (ii)
$25,000,000 (in the case of Guarantor), or (B) results in the acceleration of
the maturity of such Indebtedness in excess of a principal amount of $100,000
(in the case of Seller) or the greater of (a) $5,000,000 or (b) the lesser of
(i) 5% of Tangible Net Worth (as such term is defined in the Guaranty) and (ii)
$25,000,000 (in the case of Guarantor) by any other party to or beneficiary of
such note, indenture, loan agreement, guaranty or other Indebtedness or
(y) failed to perform any other material non-payment obligation under such note,
indenture, loan agreement, guaranty or other Indebtedness with an asserted
actual out-of-pocket damages claim in excess of the limits referenced in clause
(x) with respect to Seller or Guarantor, as applicable and acceleration occurs
under such Indebtedness as a result thereof; provided, however, that any such
default, failure to perform or breach shall not constitute an Event of Default
if Seller or Guarantor cures such default or failure to perform, as the case may
be, within the grace notice and/or cure period, if any, provided under the
applicable agreement; or

 

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  (xv)

if Seller or Guarantor shall breach or fail to perform any of the terms,
agreements, conditions, covenants or obligations applicable to such Person under
this Agreement, any other Transaction Document or any Purchased Loan Document to
which such Person is a party, other than as specifically otherwise referred to
in this definition of “Event of Default” (including, without limitation, the
failure by Seller to deliver any report required pursuant to Section 12(i)), and
such breach or failure to perform is not remedied within fifteen (15) Business
Days after written notice thereof to Seller from the applicable party or its
successors or assigns; (each of (i) through (xv), an “Event of Default”).

(b) If an Event of Default shall occur and be continuing, the following rights
and remedies shall be available to Buyer:

 

  (i)

At the option of Buyer, exercised by written notice to Seller (which option
shall be deemed to have been exercised, even if no notice is given, immediately
upon the occurrence of an Act of Insolvency), the Repurchase Date for each
Transaction hereunder shall, if it has not already occurred, be deemed
immediately to occur (the date on which such option is exercised or deemed to
have been exercised being referred to hereinafter as the “Accelerated Repurchase
Date”).

 

  (ii)

If Buyer exercises or is deemed to have exercised the option referred to in
Section 14(b)(i) of this Agreement:

 

  (A)

Seller’s obligations hereunder to repurchase all Purchased Loans shall become
immediately due and payable on and as of the Accelerated Repurchase Date; and

 

  (B)

to the extent permitted by applicable law, the Repurchase Price with respect to
each Transaction (determined as of the Accelerated Repurchase Date) shall be
increased by the aggregate amount obtained by daily application of, on a 360 day
per year basis (or, in the case of a Transaction relating to a Foreign Purchased
Loan (AU), a 365 day per year basis) for the actual number of days during the
period from and including the Accelerated Repurchase Date to but excluding the
date of payment of the Repurchase Price (as so increased), (x) the Pricing Rate
for such Transaction multiplied by (y) the outstanding Purchase Price for such
Transaction (decreased by (I) any amounts actually remitted to Buyer by the
Depository or Seller from time to time pursuant to Sections 4 or 5 of this
Agreement and applied to such Repurchase Price, and (II) any amounts applied to
the Repurchase Price pursuant to Section 14(b)(iii) of this Agreement); and

 

  (C)

the Custodian shall, upon the request of Buyer, deliver to Buyer all
instruments, certificates and other documents then held by the Custodian
relating to the Purchased Loans.

 

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  (iii)

Upon the occurrence and during the continuance of an Event of Default with
respect to Seller, Buyer may (A) immediately sell, at a public or private sale
in a commercially reasonable manner in accordance with Requirements of Law, and
with prior written notice to Seller, at such price or prices as Buyer may
reasonably deem satisfactory any or all of the Purchased Loans or (B) in its
sole discretion elect, in lieu of selling all or a portion of such Purchased
Loans, to give Seller credit for such Purchased Loans in an amount equal to the
market value of such Purchased Loans as determined by Buyer in its sole
discretion against the aggregate unpaid Repurchase Price for such Purchased
Loans and any other amounts owing by Seller under the Transaction Documents. The
proceeds of any disposition of Purchased Loans effected pursuant to this
Section 14(b)(iii) shall be applied in accordance with Section 5(g).

 

  (iv)

The parties recognize that it may not be possible to purchase or sell all of the
Purchased Loans on a particular Business Day, or in a transaction with the same
purchaser, or in the same manner because the market for such Purchased Loans may
not be liquid. In view of the nature of the Purchased Loans, the parties agree
that liquidation of a Transaction or the Purchased Loans does not require a
public purchase or sale and that a good faith private purchase or sale shall be
deemed to have been made in a commercially reasonable manner. Accordingly, Buyer
may elect, in its sole discretion in accordance with Requirements of Law, the
time and manner of liquidating any Purchased Loans, and nothing contained herein
shall (A) obligate Buyer to liquidate any Purchased Loans on the occurrence and
during the continuance of an Event of Default or to liquidate all of the
Purchased Loans in the same manner or on the same Business Day or (B) constitute
a waiver of any right or remedy of Buyer.

 

  (v)

Seller shall be liable to Buyer for (A) the amount of all actual out-of-pocket
expenses, including reasonable legal fees and expenses, actually incurred by
Buyer in connection with or as a consequence of an Event of Default with respect
to Seller, (B) all actual costs incurred in connection with the termination of
Hedging Transactions, and (C) any other actual out-of-pocket loss, damage, cost
or expense directly arising or resulting from the occurrence and continuance of
an Event of Default with respect to Seller.

 

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  (vi)

Buyer shall have, in addition to its rights and remedies under the Transaction
Documents, all of the rights and remedies provided by applicable federal, state,
foreign, and local laws (including, without limitation, if the Transactions are
recharacterized as secured financings, the rights and remedies of a secured
party under the UCC of the State of New York or, with respect to any Foreign
Purchased Loan, the equivalent Requirement of Law in the relevant non-U.S.
jurisdiction, to the extent that the UCC or such other Requirement of Law is
applicable, and the right to offset any mutual debt and claim and the right to
appropriate the Purchased Loans in accordance with this Section 12(b)(vi)), in
equity, and under any other agreement between Buyer and Seller. In relation to
Foreign Purchased Loans (AU), the Buyer shall also have the right to appoint any
person or persons to be a receiver and manager of the Collateral and, without
the need for any consent from Seller or any other Person but subject to the same
restrictions and limitations imposed on Buyer as set forth in the Transaction
Documents, each receiver will have the power to do all things the law allows an
owner of any interest in the Collateral to do. Without limiting the generality
of the foregoing, Buyer shall be entitled to set off the proceeds of the
liquidation of the Purchased Loans against all of Seller’s obligations to Buyer
pursuant to this Agreement, whether or not such obligations are then due,
without prejudice to Buyer’s right to recover any deficiency. The parties hereto
agree that the method of valuation of Purchased Loans provided for in this
Section 12(b)(vi) shall constitute a commercially reasonable method of valuation
for the purposes of the FCA Regulations.

 

  (vii)

Subject to the notice and grace periods set forth herein, Buyer may exercise any
or all of the remedies available to Buyer immediately upon the occurrence and
continuance of an Event of Default (other than with respect to Buyer) and at any
time during the continuance thereof. All rights and remedies arising under the
Transaction Documents, as amended from time to time, are cumulative and not
exclusive of any other rights or remedies which Buyer may have.

 

  (viii)

Buyer may enforce its rights and remedies hereunder without prior judicial
process or hearing, and Seller hereby expressly waives any defenses Seller might
otherwise have to require Buyer to enforce its rights by judicial process.
Seller also waives any defense Seller might otherwise have arising from the use
of nonjudicial process, disposition of any or all of the Purchased Loans, or
from any other election of remedies. Seller recognizes that nonjudicial remedies
are consistent with the usages of the trade, are responsive to commercial
necessity and are the result of a bargain at arm’s length.

 

  (ix)

Upon the designation of any Accelerated Repurchase Date, Buyer may, without
prior notice to Seller, set off any sum or obligation (whether or not arising
under this Agreement, whether matured or unmatured, whether or not contingent
and irrespective of the currency, place of payment or booking office of the sum
or obligation) owed by Seller to Buyer or any Affiliate of Buyer against any sum
or obligation (whether or not arising

 

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  under this Agreement, whether matured or unmatured, whether or not contingent
and irrespective of the currency, place of payment or booking office of the sum
or obligation) owed by Buyer or any Affiliate of Buyer to Seller. Buyer will
give written notice to the other party of any set off effected under this
Section 14(b)(ix). If a sum or obligation is unascertained, Buyer may in good
faith estimate that obligation and set-off in respect of the estimate, subject
to the relevant party accounting to the other when the obligation is
ascertained. Nothing in this Section 14(b)(ix) shall be effective to create a
charge or other security interest. This Section 14(b)(ix) shall be without
prejudice and in addition to any right of set-off, combination of accounts, lien
or other rights to which any party is at any time otherwise entitled (whether by
operation of law, contract or otherwise).

 

  (x)

With respect to any Foreign Purchased Loan, Buyer may take any steps necessary
to vest all or any of such Foreign Purchased Loan in the name of Buyer (or its
designee) including completing and submitting any Transfer Certificate to the
relevant facility agent and making payment of any transfer fees. Seller hereby
agrees that any such transfer fees paid by Buyer will constitute “Indemnified
Amounts” for the purposes of Section 27 of this Agreement.

 

15.

SINGLE AGREEMENT

Buyer and Seller acknowledge that, and have entered hereinto and will enter into
each Transaction hereunder in consideration of and in reliance upon the fact
that, all Transactions hereunder constitute a single business and contractual
relationship and have been made in consideration of each other. Accordingly,
each of Buyer and Seller agrees (i) to perform all of its obligations in respect
of each Transaction hereunder, and that a default in the performance of any such
obligations shall constitute a default by it in respect of all Transactions
hereunder, (ii) that each of them shall be entitled to set off claims and apply
property held by them in respect of any Transaction against obligations owing to
them in respect of any other Transactions hereunder and (iii) that payments,
deliveries and other transfers made by either of them in respect of any
Transaction shall be deemed to have been made in consideration of payments,
deliveries and other transfers in respect of any other Transactions hereunder,
and the obligations to make any such payments, deliveries and other transfers
may be applied against each other and netted.

 

16.

RECORDING OF COMMUNICATIONS

EACH OF BUYER AND SELLER SHALL HAVE THE RIGHT (BUT NOT THE OBLIGATION) FROM TIME
TO TIME TO MAKE OR CAUSE TO BE MADE TAPE RECORDINGS OF COMMUNICATIONS BETWEEN
ITS EMPLOYEES, IF ANY, AND THOSE OF THE OTHER PARTY WITH RESPECT TO
TRANSACTIONS; PROVIDED, HOWEVER, THAT SUCH RIGHT TO RECORD COMMUNICATIONS SHALL
BE LIMITED TO COMMUNICATIONS OF EMPLOYEES TAKING PLACE ON THE TRADING FLOOR OF
THE APPLICABLE PARTY.

 

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17.

NOTICES AND OTHER COMMUNICATIONS

Unless otherwise provided in this Agreement, all notices, consents, approvals
and requests required or permitted hereunder shall be given in writing and shall
be effective for all purposes if hand delivered or sent by (a) hand delivery,
with proof of delivery, (b) certified or registered United States mail, postage
prepaid, (c) expedited prepaid delivery service, either commercial, United
States Postal Service, Royal Mail or Australia Post, with proof of delivery, or
(d) by email with proof of delivery to the address specified in Annex I hereto
or at such other address and person as shall be designated from time to time by
any party hereto, as the case may be, in a written notice to the other parties
hereto in the manner provided for in this Section. A notice shall be deemed to
have been given: (a) in the case of hand delivery, at the time of delivery,
(b) in the case of registered or certified mail, when delivered or the first
attempted delivery on a Business Day, (c) in the case of expedited prepaid
delivery upon the first attempted delivery on a Business Day, or (d) in the case
of email, upon receipt of confirmation of transmission and delivery,
respectively, provided that such notice sent by email was also delivered as
required in this Section. A party receiving a notice which does not comply with
the technical requirements for notice under this Section may elect to waive any
deficiencies and treat the notice as having been properly given. Notwithstanding
the foregoing, in the event that Seller directs Buyer to transfer funds pursuant
to a Transaction or otherwise in accordance with Section 3 or 4 to an account or
recipient other than Seller’s wiring instructions specified on Annex I, such
direction shall be in writing (including in a Confirmation) and signed by two
(2) authorized officers of Seller.

 

18.

ENTIRE AGREEMENT; SEVERABILITY

This Agreement shall supersede any existing agreements between the parties
containing general terms and conditions for repurchase transactions. Each
provision and agreement herein shall be treated as separate and independent from
any other provision or agreement herein and shall be enforceable notwithstanding
the unenforceability of any such other provision or agreement.

 

19.

NON-ASSIGNABILITY

(a) The rights and obligations of Seller under the Transaction Documents and
under any Transaction shall not be assigned by Seller without the prior written
consent of Buyer.

(b) Upon prior written notice to Seller, Buyer shall be entitled to assign an
interest in its rights and obligations under the Transaction Documents and/or
under any Transaction to any other Person or issue one or more participation
interests with respect to any or all of the Transactions and, in connection
therewith, may bifurcate or allocate (i.e. senior/subordinate) amounts due to
Buyer; provided, however, in all such instances, so long as no Event of Default
has occurred and is continuing, (i) Buyer may not assign an interest in its
rights and obligations under the Transaction Documents and/or under any
Transaction or issue one or more participation interests with respect to any or
all of the Transactions to any Prohibited Transferee, (ii) Buyer shall retain
control and authority over its rights and obligations under the Transaction
Documents and/or under any Transaction, (iii) Seller shall not be obligated to
deal directly or indirectly with any party other than Buyer, and (iv) Seller
shall not be charged for, incur or be

 

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required to pay or reimburse Buyer or any assignee, transferee, participant or
other third party for any costs that would not have been incurred but for the
assignment, participation, bifurcation or allocation by Buyer in accordance with
this Section 19(b). In furtherance of and without limitation to the foregoing,
in no event shall Buyer confer on or grant any rights in any Person other than
Buyer any right to determine the Market Value of any Purchased Loan, to declare
a Margin Deficit, to determine whether a Default or Event of Default has
occurred or is continuing, to approve a Purchased Loan, to make available to
Seller Margin Excess, or to enforce any provision of any Transaction Documents
against Seller or Guarantor, it being understood and agreed that nothing herein
shall restrict or limit Buyer’s right to consult with and consider the views and
opinions of any assignee, transferee or participant under this Agreement.

(c) Buyer, acting solely for this purpose as a non-fiduciary agent of Seller,
shall maintain a register for the recordation of each assignment pursuant to
Section 19(b) above and the name and address of any assignee, and the Repurchase
Price and Price Differential owing to such assignee (the “Register”). The
entries in the Register shall be conclusive absent manifest error. Buyer and
Seller shall treat each Person whose name is recorded in the Register pursuant
to the terms hereof as the owner of the applicable rights and obligations and no
transfer or assignment shall be effective unless duly noted in the Register. The
Register shall be available for inspection by Seller at any reasonable time and
from time to time upon reasonable request.

(d) Buyer and each assignee, if any that sells a participation shall, acting
solely for this purpose as a non-fiduciary agent of Seller, maintain a register
on which it records such sale, the name and address of the applicable
participant and, with respect to each such participant, the participated
Repurchase Price and Price Differential (the “Participant Register”). Neither
Buyer nor any such assignee shall have any obligation to disclose the identity
of any participant or any information relating to a participant’s interest in
any obligations under any Transaction Document to any Person except (i) to the
extent that the Internal Revenue Service requests such disclosure (from Seller,
Guarantor, Buyer, such assignee or otherwise) or such disclosure is otherwise
reasonably determined to be required to establish that such obligation is in
registered form under Section 5f.103-1I of the United States Treasury
Regulations (the “Treasury Regulations”), and (ii) the portion of the
Participant Register relating to any such participant requesting (directly or
through Buyer or an assignee) payment from Seller under the Transaction
Documents shall be made available to Seller upon reasonable request. The entries
in the Participant Register shall be conclusive absent manifest error. The
applicable Buyer shall treat each Person whose name is recorded in the
Participant Register as the owner of the applicable participation for all
purposes of this Agreement and no sale of a participation shall be effective
unless duly noted in the Participant Register.

(e) Subject to the foregoing, the Transaction Documents and any Transactions
shall be binding upon and shall inure to the benefit of the parties and their
respective successors and assigns. Nothing in the Transaction Documents, express
or implied, shall give to any Person, other than the parties to the Transaction
Documents and their respective successors, any benefit or any legal or equitable
right, power, remedy or claim under the Transaction Documents.

 

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20.

GOVERNING LAW

This Agreement shall be governed by the laws of the State of New York without
giving effect to the conflict of law principles thereof. The parties hereto
intend that the provisions of section 5-1401 of the New York General Obligations
Law shall apply to this Agreement.

 

21.

NO WAIVERS, ETC.

No express or implied waiver of any Event of Default by either party shall
constitute a waiver of any other Event of Default and no exercise of any remedy
hereunder by any party shall constitute a waiver of its right to exercise any
other remedy hereunder. No modification or waiver of any provision of this
Agreement and no consent by any party to a departure herefrom shall be effective
unless and until such shall be in writing and duly executed by both of the
parties hereto. Without limitation on any of the foregoing, the failure to give
a notice pursuant to Section 4(a) or 4(b) hereof will not constitute a waiver of
any right to do so at a later date.

 

22.

USE OF EMPLOYEE PLAN ASSETS

(a) If assets of an employee benefit plan subject to any provision of the
Employee Retirement Income Security Act of 1974 (“ERISA”) are intended to be
used by either party hereto (the “Plan Party”) in a Transaction, the Plan Party
shall so notify the other party prior to the Transaction. The Plan Party shall
represent in writing to the other party that the Transaction does not constitute
a prohibited transaction under ERISA, and the other party may proceed in
reliance thereon but shall not be required so to proceed.

(b) Subject to the last sentence of subparagraph (a) of this Section, any such
Transaction shall proceed only if Seller furnishes or has furnished to Buyer its
most recent available unaudited statement of its financial condition.

(c) By entering into a Transaction pursuant to this Section, Seller shall be
deemed (i) to represent to Buyer that since the date of Seller’s latest such
financial statements, there has been no material adverse change in Seller’s
financial condition which Seller has not disclosed to Buyer, and (ii) to agree
to provide Buyer with future audited and unaudited statements of its financial
condition as they are issued, so long as it is a Seller in any outstanding
Transaction involving a Plan Party.

 

23.

INTENT

(a) The parties recognize and agree that: (i) each Transaction is a “repurchase
agreement” as that term is defined in Section 101(47) of the Bankruptcy Code and
a “securities contract” as that term is defined in Section 741(7) of the
Bankruptcy Code, (ii) payments under this Agreement are deemed “margin payments”
or “settlement payments,” as defined in Section 741 of the Bankruptcy Code, and
(iii) the grant of a security interest set forth in Sections 6 and 29(b) hereof
and the Guaranty, each of which secures the rights of Buyer hereunder also
constitutes a “repurchase agreement” as contemplated by Section 101(47)(A)(v) of
the Bankruptcy Code and a “securities contract” as contemplated by
Section 741(7)(A)(xi) of the Bankruptcy Code. It is further understood that this
Agreement constitutes a “master netting

 

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agreement” as defined in Section 101(38A) of the Bankruptcy Code, as amended,
with respect to the Transaction so constituting a “repurchase agreement” or
“securities contract”. The parties intend and recognize that the arrangements
under this Agreement are to constitute a “title transfer financial collateral
arrangement” or a “security financial collateral arrangement” for the purposes
of the Financial Collateral Arrangements (No 2) Regulations 2003 (the “FCA
Regulations”).

(b) The parties recognize and agree that each of Buyer and Seller is a “repo
participant” as that term is defined in Section 101(46) of the Bankruptcy Code.

(c) The parties recognize and agree that each party (for so long as each is
either a “financial institution,” “financial participant,” repo participant, or
“master netting participant” or other entity listed in Section 555, 559, 561,
362(b)(6), or 362(b)(7) of the Bankruptcy Code) shall be entitled to the “safe
harbor” benefits and protections afforded under the Bankruptcy Code with respect
to a “repurchase agreement” and a “securities contract” and a “master netting
agreement,” including (x) the rights set forth in Sections 3 and 14 and in
Section 555, 559, and 561 of the Bankruptcy Code to liquidate the Purchased
Loans and/or accelerate or terminate this Agreement, and (y) the right to offset
or net out termination payments, payment amounts or other transfer obligations
and otherwise exercise contractual rights as set forth in Sections 362(b)(6),
362(b)(7), 362(b)(27), 362(o), and 546 of the Bankruptcy Code.

(d) Each party hereto hereby further agrees that it shall not challenge the
characterization of (i) this Agreement as a “repurchase agreement”, “securities
contract” and/or “master netting agreement”, or (ii) each party as a “repo
participant” within the meaning of the Bankruptcy Code except insofar as, in the
case of a “repurchase agreement”, the term of the Transactions, would render
such definition inapplicable.

(e) It is understood that either party’s right to accelerate or terminate this
Agreement or to liquidate assets delivered to it in connection with the
Transactions hereunder or to exercise any other remedies pursuant to Section 14
or 29 hereof is a contractual right to accelerate, terminate or liquidate this
Agreement or the Transactions as described in Sections 555 and 559 of the
Bankruptcy Code. It is further understood and agreed that either party’s right
to cause the termination, liquidation, or acceleration of, or to offset net
termination values, payment amounts or other transfer obligations arising under
or in connection with, this Agreement or the Transactions hereunder is a
contractual right to cause the termination, liquidation, or acceleration of, or
to offset net termination values, payment amounts or other transfer obligations
arising under or in connection with, this Agreement as described in Section 561
of the Bankruptcy Code.

(f) The parties agree and acknowledge that if a party hereto is an “insured
depository institution,” as such term is defined in the Federal Deposit
Insurance Act, as amended (“FDIA”), then each of the Transactions hereunder is a
“qualified financial contract,” as that term is defined in FDIA and any rules,
orders or policy statements thereunder (except insofar as the type of assets
subject to the Transactions would render such definition inapplicable).

(g) The parties agree and acknowledge that this Agreement constitutes a “netting
contract” as defined in and subject to Title IV of the Federal Deposit Insurance
Corporation Improvement Act of 1991 (“FDICIA”) and each payment entitlement and
payment obligation under the Transactions hereunder shall constitute a “covered
contractual payment entitlement” or “covered contractual payment obligation”,
respectively, as defined in and subject to FDICIA (except insofar as one or both
of the parties is not a “financial institution” as that term is defined in
FDICIA).

 

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(h) In light of the intent set forth above in this Section 23, each Party agrees
that, from time to time upon the written request of the other Party (the
“Requesting Party”), each Party will execute and deliver any supplements,
modifications, addendums or other documents as may be necessary or desirable, in
the Requesting Party’s good faith discretion, in order to cause this Agreement
and the Transactions contemplated hereby to qualify for, comply with the
provisions of, or otherwise satisfy, maintain or preserve the criteria for safe
harbor treatment under the Bankruptcy Code for “repurchase agreements”,
“securities contracts” and “master netting agreements”; provided, however, that
either Party’s failure to request, or either Party’s failure to execute, such
supplements, modifications, addendums or other documents does not in any way
alter or otherwise change the intention of the parties hereto that this
Agreement and the Transactions hereunder constitute “repurchase agreements”,
“securities contracts” and/or a “master netting agreement” as such terms are
defined in the Bankruptcy Code.

(i) Notwithstanding anything to the contrary in this Agreement, it is the
intention of the parties that, for U.S. Federal, state and local income and
franchise tax purposes, the Transactions constitute a loan from Buyer to Seller,
and that Seller is and, so long as no Event of Default shall have occurred and
be continuing, will continue to be, treated as the owner of the Purchased Loans
for such purposes. Unless prohibited by applicable law, Seller and Buyer (and
its assignees and participants, if any) shall treat the Transactions as
described in the preceding sentence for all U.S. Federal, state and local income
and franchise tax purposes (including, without limitations, on any and all
filings with any U.S. Federal, state or local taxing authority).

 

24.

DISCLOSURE RELATING TO CERTAIN FEDERAL PROTECTIONS

The parties acknowledge that they have been advised that:

(a) in the case of Transactions in which one of the parties is a broker or
dealer registered with the Securities and Exchange Commission (“SEC”) under
Section 15 of the Securities Exchange Act of 1934 (“1934 Act”), the Securities
Investor Protection Corporation has taken the position that the provisions of
the Securities Investor Protection Act of 1970 (“SIPA”) do not protect the other
party with respect to any Transaction hereunder;

(b) in the case of Transactions in which one of the parties is a government
securities broker or a government securities dealer registered with the SEC
under Section 15C of the 1934 Act, SIPA will not provide protection to the other
party with respect to any Transaction hereunder;

(c) in the case of Transactions in which one of the parties is a financial
institution, funds held by the financial institution pursuant to a Transaction
hereunder are not a deposit and therefore are not insured by the Federal Deposit
Insurance Corporation or the National Credit Union Share Insurance Fund, as
applicable; and

 

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(d) in the case of Transactions that may be a financial service in Australia,
Citibank, N.A. relies upon various exemptions from the need to hold an
Australian Financial Services Licence (“AFSL”) including the exemption in ASIC
Class Order CO 03/1101. Citibank, N.A. is incorporated in the United States of
America and its principal regulators are the US Office of the Comptroller of
Currency and Federal Reserve under US laws, which differ from Australian laws.
It does not hold an AFSL under the Corporations Act 2001 (Cth) as it enjoys the
benefit of an exemption under ASIC Class Order CO 03/1101.

 

25.

CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL

(a) Each party irrevocably and unconditionally (i) submits to the exclusive
jurisdiction of any United States Federal or New York State court sitting in
Manhattan, and any appellate court from any such court, solely for the purpose
of any suit, action or proceeding brought to enforce its obligations under this
Agreement or relating in any way to this Agreement or any Transaction under this
Agreement and (ii) waives, to the fullest extent it may effectively do so, any
defense of an inconvenient forum to the maintenance of such action or proceeding
in any such court and any right of jurisdiction on account of its place of
residence or domicile.

(b) To the extent that either party has or hereafter may acquire any immunity
(sovereign or otherwise) from any legal action, suit or proceeding, from
jurisdiction of any court or from set off or any legal process (whether service
or notice, attachment prior to judgment, attachment in aid of execution of
judgment, execution of judgment or otherwise) with respect to itself or any of
its property, such party hereby irrevocably waives and agrees not to plead or
claim such immunity in respect of any action brought to enforce its obligations
under this Agreement or relating in any way to this Agreement or any Transaction
under this Agreement.

(c) The parties hereby irrevocably waive, to the fullest extent it may
effectively do so, the defense of an inconvenient forum to the maintenance of
such action or proceeding and irrevocably consent to the service of any summons
and complaint and any other process by the mailing of copies of such process to
them at their respective address specified herein. The parties hereby agree that
a final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. Nothing in this Section 25 shall affect the right of Buyer or
Seller to serve legal process in any other manner permitted by law or affect the
right of Buyer or Seller to bring any action or proceeding against the other
party or its property in the courts of other jurisdictions.

(d) EACH OF THE PARTIES HEREBY IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY
IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS
AGREEMENT, ANY OTHER TRANSACTION DOCUMENT OR ANY INSTRUMENT OR DOCUMENT
DELIVERED HEREUNDER OR THEREUNDER.

 

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26.

NO RELIANCE

Each of Buyer and Seller hereby acknowledges, represents and warrants to the
other that, in connection with the negotiation of, the entering into, and the
performance under, the Transaction Documents and each Transaction thereunder:

(a) It is not relying (for purposes of making any investment decision or
otherwise) upon any advice, counsel or representations (whether written or oral)
of the other party to the Transaction Documents, other than the representations
expressly set forth in the Transaction Documents;

(b) It has consulted with its own legal, regulatory, tax, business, investment,
financial and accounting advisors to the extent that it has deemed necessary,
and it has made its own investment, hedging and trading decisions (including
decisions regarding the suitability of any Transaction) based upon its own
judgment and upon any advice from such advisors as it has deemed necessary and
not upon any view expressed by the other party;

(c) It is a sophisticated and informed Person that has a full understanding of
all the terms, conditions and risks (economic and otherwise) of the Transaction
Documents and each Transaction thereunder and is capable of assuming and willing
to assume (financially and otherwise) those risks;

(d) It is entering into the Transaction Documents and each Transaction
thereunder for the purposes of managing its borrowings or investments or hedging
its underlying assets or liabilities and not for purposes of speculation; and

(e) It is not acting as a fiduciary or financial, investment or commodity
trading advisor for the other party and has not given the other party (directly
or indirectly through any other Person) any assurance, guaranty or
representation whatsoever as to the merits (either legal, regulatory, tax,
business, investment, financial accounting or otherwise) of the Transaction
Documents or any Transaction thereunder.

 

27.

INDEMNITY

Seller hereby agrees to indemnify Buyer and each of its officers, directors,
employees and agents (“Indemnified Parties”) from and against any and all actual
out-of-pocket liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, fees, costs, expenses (including reasonable attorneys fees and
disbursements of outside counsel) or disbursements (all of the foregoing,
collectively “Indemnified Amounts”) which may at any time (including, without
limitation, such time as this Agreement shall no longer be in effect and the
Transactions shall have been repaid in full) be imposed on or asserted against
any Indemnified Party in any way whatsoever arising out of or in connection
with, or relating to, this Agreement or any Transactions thereunder or any
action taken or omitted to be taken by any Indemnified Party under or in
connection with any of the foregoing; provided, that Seller shall not be liable
for Indemnified Amounts resulting from the gross negligence or willful
misconduct of any Indemnified Party. Without limiting the generality of the
foregoing, Seller agrees to hold Buyer harmless from and indemnify Buyer against
all Indemnified Amounts with respect to all

 

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Purchased Loans relating to or arising out of any violation or alleged violation
of any Environmental Law, rule or regulation or any consumer credit laws,
including without limitation ERISA, the Truth in Lending Act and/or the Real
Estate Settlement Procedures Act, that, in each case, results from anything
other than Buyer’s gross negligence or willful misconduct. In any suit,
proceeding or action brought by Buyer in connection with any Purchased Loan for
any sum owing thereunder, or to enforce any provisions of any Purchased Loan,
Seller will save, indemnify and hold Buyer harmless from and against all actual
out-of-pocket expense (including reasonable attorneys’ fees of outside counsel),
actual out-of-pocket loss or damage suffered by reason of any defense, set-off,
counterclaim, recoupment or reduction or liability whatsoever of the account
debtor or obligor thereunder, arising out of a breach by Seller of any
obligation thereunder or arising out of any other agreement, indebtedness or
liability at any time owing to or in favor of such account debtor or obligor or
its successors from Seller. This Section 27 shall not apply with respect to
Taxes other than any Taxes that represent losses, claims, damages, etc. arising
from any non-Tax claim.

 

28.

DUE DILIGENCE

Seller acknowledges that, at reasonable times and upon reasonable notice to
Seller, Buyer has the right to perform continuing due diligence reviews with
respect to the Purchased Loans, for purposes of verifying compliance with the
representations, warranties and specifications made hereunder, or otherwise, and
Seller agrees that upon reasonable prior written notice to Seller, Buyer or its
authorized representatives will be permitted during normal business hours to
examine, inspect, and make copies and extracts of, the Purchased Loan Files,
Servicing Records and any and all documents, records, agreements, instruments or
information relating to such Purchased Loans in the possession or under the
control of Seller, any other servicer or subservicer of Seller and/or the
Custodian. Seller also shall make available to Buyer upon reasonable advance
written notice a knowledgeable financial or accounting officer for the purpose
of answering financial or accounting questions respecting the Purchased Loan
Files and the Purchased Loans. Without limiting the generality of the foregoing,
Seller acknowledges that Buyer may enter into Transactions with Seller based
solely upon the information provided by Seller to Buyer and the representations,
warranties and covenants contained herein, and that Buyer, at its option, has
the right at any time to conduct a partial or complete due diligence review on
some or all of the Purchased Loans. Buyer may underwrite such Purchased Loans
itself or engage a third party underwriter to perform such underwriting. Seller
agrees to reasonably cooperate with Buyer and any third party underwriter
reasonably acceptable to Seller in connection with such underwriting, including,
but not limited to, providing Buyer and any third party underwriter with access
to any and all documents, records, agreements, instruments or information
relating to such Purchased Loans in the possession, or under the control, of
Seller. Seller further agrees that Seller shall reimburse Buyer for any and all
actual costs and expenses reasonably incurred by Buyer in connection with
Buyer’s activities pursuant to this Section 28 and for Buyer’s actual costs and
out-of-pocket expenses incurred in connection with due diligence reviews with
respect to Eligible Loans which Seller proposes to make the subject of a
Transaction under this Agreement. Notwithstanding the foregoing, (x) Seller’s
obligation to reimburse Buyer for Buyer’s out-of-pocket costs and expenses
(including legal expenses) incurred in connection with Eligible Loans which
Seller proposes to make the subject of a Transaction shall not exceed (1) with
respect to each U.S. Purchased Loan, $15,000 with respect

 

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to any individual Eligible Loan without Seller’s prior consent and (2) with
respect to each Foreign Purchased Loan, an amount to be agreed upon in writing
by Seller and Buyer prior to the commencement of due diligence, each acting
reasonably and (y) so long as an Event of Default has not occurred and is not
continuing, with respect to any due diligence Buyer proposes to perform with
respect to any Purchased Loan after the related Purchase Date which would create
a reimbursement obligation on the part of Seller, Buyer shall provide to Seller
prior written notice of such due diligence activities (including an estimate of
the cost) and a reasonable opportunity for Seller to demonstrate to Buyer that
such due diligence need not be performed, provided the final determination to
perform or not perform such due diligence shall be made by Buyer.

 

29.

SERVICING

(a) Seller and Buyer agree that all Servicing Rights with respect to the
Purchased Loans are being transferred hereunder to Buyer on the applicable
Purchase Date and such Servicing Rights shall be transferred by Buyer to Seller
upon Seller’s payment of the Repurchase Price for such applicable Purchased
Loan. Notwithstanding the purchase and sale of the Purchased Loans and Servicing
Rights hereby, Seller or, upon request by Seller, Servicer shall be granted a
revocable license to exercise the Servicing Rights with respect to the Purchased
Loans for the benefit of Buyer and, if Buyer shall exercise its rights to pledge
or hypothecate a Purchased Loan prior to the Repurchase Date pursuant to
Section 8, Buyer’s assigns (which license shall be deemed automatically revoked
upon the occurrence and during the continuance of an Event of Default);
provided, however, that the obligations of Seller or Servicer to service the
Purchased Loans shall cease, at Seller’s option, upon the payment by Seller to
Buyer of the Repurchase Price therefor. Seller shall cause Servicer to service
the Purchased Loans pursuant to the Servicing Agreement, in each case, in
accordance with Accepted Servicing Practices. Seller shall obtain the written
consent of Buyer prior to appointing any third party Servicer for a Purchased
Loan or entering into any Servicing Agreement with a Servicer (other than the
initial Servicing Agreement with Midland Loan Services as initial Servicer).

(b) Seller agrees that Buyer is the owner of all servicing records, files,
documents, records, data bases, computer tapes, copies of computer tapes, proof
of insurance coverage, insurance policies, appraisals, other closing
documentation, payment history records, and any other records relating to or
evidencing the servicing of Purchased Loans (collectively, the “Servicing
Records”) so long as the Purchased Loans are subject to this Agreement. Seller
grants Buyer a security interest in all servicing fees and rights relating to
the Purchased Loans and all Servicing Records to secure the obligation of Seller
or Servicer to service in conformity with this Section and any other obligation
of Seller to Buyer. Seller covenants to safeguard such Servicing Records which
are in Seller’s possession and to deliver them promptly to Buyer or its designee
(including the Custodian) at Buyer’s request.

(c) Upon the occurrence and during the continuance of an Event of Default, Buyer
may, in its sole discretion, (i) sell its right to the Purchased Loans on a
servicing released basis or (ii) terminate any Seller or Servicer of the
Purchased Loans with or without cause, in each case without payment of any
termination fee to the extent provided in the Servicing Agreement.

 

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(d) Seller shall not employ or permit Servicer to employ sub-servicers to
service the Purchased Loans without (x) in the case of U.S. Purchased Loans
only, the prior written approval of Buyer in its sole discretion, except to the
extent permitted in the applicable Servicing Agreement so long as, such
employment of a sub-servicer constitutes a delegation of duties by Servicer
which does not relieve Servicer of its primary obligation to perform such duties
or (y) in the case of Foreign Purchased Loans, prior to consummating any such
appointment, a consultation with Buyer.

(e) The payment of servicing fees under any Servicing Agreement shall be solely
the obligation of Seller.

(f) With respect to each CLO Participation A-1 issued pursuant to a CLO
Participation Agreement, in the event of any inconsistency between the
provisions of this Section 29 and of each CLO Participation Agreement and the
CLO Servicing Agreement, the terms of such CLO Participation Agreement and the
CLO Servicing Agreement shall control with respect to such CLO Participation A-1
only.

 

30.

MISCELLANEOUS

(a) All rights, remedies and powers of Buyer hereunder and in connection
herewith are irrevocable and cumulative, and not alternative or exclusive, and
shall be in addition to all other rights, remedies and powers of Buyer whether
under law, equity or agreement. In addition to the rights and remedies granted
to it in this Agreement, to the extent this Agreement is determined to create a
security interest, Buyer shall have all rights and remedies of a secured party
under the UCC or, with respect to Foreign Purchased Loans, the equivalent
Requirements of Law in the relevant non-U.S. jurisdiction.

(b) The Transaction Documents may be executed in counterparts, each of which so
executed shall be deemed to be an original, but all of such counterparts shall
together constitute but one and the same instrument. Signatures delivered by
email (in PDF format) shall be considered binding with the same force and effect
as original signatures.

(c) The headings in the Transaction Documents are for convenience of reference
only and shall not affect the interpretation or construction of the Transaction
Documents.

(d) Without limiting the rights and remedies of Buyer under the Transaction
Documents, Seller shall pay Buyer’s reasonable actual out-of-pocket costs and
expenses, including reasonable fees and expenses of outside accountants,
attorneys and advisors, incurred in connection with the preparation,
negotiation, execution and consummation of, and any amendment, supplement or
modification to, the Transaction Documents and the Transactions thereunder.
Seller agrees to pay Buyer promptly all costs and expenses (including reasonable
expenses for legal services of every kind) of any subsequent enforcement of any
of the provisions hereof, or of the performance by Buyer of any obligations of
Seller in respect of the Purchased Loans, or any actual or attempted sale, or
any exchange, enforcement, collection, compromise or settlement in respect of
any of the Collateral and for the custody, care or preservation of the
Collateral (including insurance costs) and defending or asserting rights and
claims of Buyer in respect thereof, by litigation or otherwise. In addition,
Seller agrees to pay

 

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Buyer promptly all reasonable actual out-of-pocket costs and expenses (including
reasonable expenses for legal services of outside counsel) reasonably incurred
in connection with the maintenance of each Cash Management Account and
registering the Collateral in the name of Buyer or its nominee. All such
expenses shall be recourse obligations of Seller to Buyer under this Agreement.

(e) Each provision of this Agreement shall be interpreted in such manner as to
be effective and valid under applicable law, but if any provision of this
Agreement shall be prohibited by or be invalid under such law, such provision
shall be ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of this
Agreement.

(f) This Agreement contains a final and complete integration of all prior
expressions by the parties with respect to the subject matter hereof and thereof
and shall constitute the entire agreement among the parties with respect to such
subject matter, superseding all prior oral or written understandings.

(g) The parties understand that this Agreement is a legally binding agreement
that may affect such party’s rights. Each party represents to the other that it
has received legal advice from counsel of its choice regarding the meaning and
legal significance of this Agreement and that it is satisfied with its legal
counsel and the advice received from it.

(h) Should any provision of this Agreement require judicial interpretation, it
is agreed that a court interpreting or construing the same shall not apply a
presumption that the terms hereof shall be more strictly construed against any
Person by reason of the rule of construction that a document is to be construed
more strictly against the Person who itself or through its agent prepared the
same, it being agreed that all parties have participated in the preparation of
this Agreement.

(i) The parties recognize that each Transaction is a “securities contract” as
that term is defined in Section 741 of Title 11 of the United States Code, as
amended.

(j) The Transaction with respect to the Purchased Loan referred to as 190 Bowery
shall remain as a Transaction for all purposes under the Agreement, but shall
not be counted towards the Facility Amount for purposes of determining
availability with respect to proposed Purchased Loans or for purpose of
Section 3(a)(i) of this Agreement.

 

31.

TAXES

(a) Any and all payments by or on account of any obligation of Seller under any
Transaction Document shall be made without deduction or withholding for any
Taxes, except as required by applicable law. If any applicable law requires the
deduction or withholding of any Tax from any such payment, then Seller shall
make (or cause to be made) such deduction or withholding and shall timely pay
(or cause to be timely paid) the full amount deducted or withheld to the
relevant Governmental Authority in accordance with applicable law and, if such
Tax is an Indemnified Tax, then the sum payable shall be increased by Seller as
necessary so that after such deduction or withholding has been made (including
such deductions and withholdings applicable to additional sums payable under
this Section 31) Buyer receives an amount equal to the sum it would have
received had no such deduction or withholding been made.

 

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(b) Seller shall timely pay any Other Taxes to the relevant Governmental
Authority in accordance with applicable law.

(c) Seller shall indemnify Buyer, within ten (10) Business Days after demand
therefor, for the full amount of any Indemnified Taxes (including Indemnified
Taxes imposed or asserted on or attributable to amounts payable under this
Section 31) payable or paid by Buyer or required to be withheld or deducted from
a payment to Buyer, and any reasonable expenses arising therefrom or with
respect thereto, whether or not such Indemnified Taxes were correctly or legally
imposed or asserted by the relevant Governmental Authority. A certificate
setting forth in reasonable detail calculation of the amount of such payment or
liability (together with a certified copy of the return reporting such payment,
if applicable or other evidence of such payment reasonably satisfactory to
Seller) delivered to Seller by Buyer shall be conclusive absent manifest error.

(d) Buyer shall deliver to Seller such documentation as prescribed by applicable
law or as reasonably requested by Seller as will enable Seller to determine
whether or not payments hereunder or under any other Transaction Document to or
for the benefit of Buyer (or any assignee or participant thereof) is subject to
tax withholding, backup withholding or information reporting requirements.
Without limiting the generality of the foregoing, if Buyer (or an assignee or
participant thereof) is entitled to an exemption from or reduction of
withholding tax with respect to payments made under any Transaction Document,
Buyer shall deliver to Seller, at the time or times prescribed by applicable law
and otherwise as reasonably requested by Seller, such properly completed and
executed documentation as prescribed by applicable law or as reasonably
requested by Seller as will permit such payments to be made without withholding
or at a reduced rate of withholding. Without limiting the generality of the
foregoing:

(i) On or prior to the date on which Buyer becomes a Buyer under this Agreement
and prior to the entry in the Register of any assignment to a U.S. Person (and
from time to time thereafter as required by applicable law or upon the
reasonable request of Seller) Buyer shall deliver to Seller two (2) executed
originals of IRS Form W-9 (or successor forms) certifying that Buyer (and/or
such assignee) is exempt from U.S. federal backup withholding tax.

(ii) On or prior to entry in the Register of an assignment to an assignee that
is not a U.S. Person (and from time to time thereafter as required by applicable
law or upon the reasonable request of Seller) Buyer shall deliver to Seller two
(2) executed originals of IRS Forms W-8ECI, W-8BEN, W-8BEN-E, W-8IMY (or any
successor forms thereof, as applicable) or other applicable form, certificate or
document prescribed by the United States Internal Revenue Service certifying as
to such person’s entitlement to exemption from, or reduction in the rate of,
withholding Taxes.

(e) If a payment made to Buyer (or any assignee or participant thereof) under
any Transaction Document would be subject to U.S. federal withholding Tax
imposed by FATCA if such person were to fail to comply with the applicable
reporting requirements of FATCA (including those contained in Section 1471(b) or
1472(b) of the Code, as applicable), such person

 

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shall deliver to Seller at the time or times prescribed by law and at such time
or times reasonably requested by Seller such documentation prescribed by
applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code)
and such additional documentation reasonably requested by Seller as may be
necessary for Seller to comply with its obligations under FATCA and to determine
that such person has complied with it’s obligations under FATCA or to determine
the amount to deduct and withhold from such payment. Solely for purposes of this
clause (c), “FATCA” shall include any amendments made to FATCA after the date of
this Agreement

(f) Buyer may not effect an assignment (and may not reflect such assignment in
the Register) to an assignee that is not a U.S. Person, unless such assignee
delivers a valid U.S. branch withholding certificate on IRS Form W-8IMY (or any
successor thereto) evidencing its agreement with Buyer and Seller to be treated
as a U.S. Person for U.S. federal withholding purposes.

(g) Buyer (and each applicable assignee and participant) agrees that if any form
or certification it previously delivered (on behalf of itself or any assignee or
any participant thereof) expires or becomes obsolete or inaccurate in any
respect, it shall update (in the case of an assignee or participant, by
obtaining such updated form for such person) such form or certification or
promptly notify Seller in writing of its legal inability to do so.

(h) If any party determines, in its sole discretion exercised in good faith,
that it has received a refund of any Taxes as to which it has been indemnified
pursuant to this Section 31 (including by the payment of additional amounts
pursuant to this Section 31), it shall pay to the indemnifying party an amount
equal to such refund (but only to the extent of indemnity payments made under
this Section 31 with respect to the Taxes giving rise to such refund), net of
all out-of-pocket expenses (including Taxes) of such indemnified party and
without interest (other than any interest paid by the relevant Governmental
Authority with respect to such refund). Such indemnifying party, upon the
request of such indemnified party, shall repay to such indemnified party the
amount paid over pursuant to this Section 31(h) (plus any penalties, interest or
other charges imposed by the relevant Governmental Authority) in the event that
such indemnified party is required to repay such refund to such Governmental
Authority. Notwithstanding anything to the contrary in this Section 31(h), in no
event will the indemnified party be required to pay any amount to an
indemnifying party pursuant to this Section 31(h) the payment of which would
place the indemnified party in a less favorable net after-Tax position than the
indemnified party would have been in if the indemnification payments or
additional amounts giving rise to such refund had never been paid. This
Section 31(h) shall not be construed to require any indemnified party to make
available its Tax returns (or any other information relating to its Taxes that
it deems confidential) to the indemnifying party or any other Person.

(i) Buyer on the one hand, and each of Parlex 2 UK, Parlex 2 EUR and Parlex 2 AU
(as relevant) on the other hand, each confirm that it will take all steps
(including without limitation the completion of procedural formalities)
reasonably required by the other such that payments by the obligors in respect
of the Foreign Purchased Loans can be made without deduction or withholding for
or on account of tax so far as legally permissible.

 

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(j) Buyer (and each of its designees) and Parlex 2 UK each confirm that it is
entitled to full exemption from tax imposed by the United Kingdom on interest
under the terms of the double taxation agreement between the United Kingdom and
the United States of America. Buyer (and each of its designees) and Parlex 2 AU
each confirm that it is entitled to full exemption from tax imposed by Australia
on interest under the terms of the Convention between the Government of
Australia and the Government of the United States of America for the Avoidance
of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on
Income [1983] ATS 16 and Protocol [2003] ATS 14.

(k) Buyer agrees that, so long as no Event of Default has occurred and is
continuing, it will promptly notify Seller if Buyer (or its designee) assigns or
otherwise transfers any interest in any Foreign Purchased Loan where it is aware
that to do so could result in any increased deduction or withholding for or on
account of tax from amounts payable by the obligors in respect of such Foreign
Purchased Loan.

(l) Each party’s obligations under this Section 31 shall survive any assignment
of rights by, or the replacement of, Buyer, the termination of the Transactions
and the repayment, satisfaction or discharge of all obligations under any
Transaction Document.

 

32.

JOINT AND SEVERAL OBLIGATIONS

(a) Each Seller hereby acknowledges and agrees that (i) each Seller shall be
jointly and severally liable to Buyer to the maximum extent permitted by
Requirement of Law for all Repurchase Obligations, (ii) the liability of each
Seller with respect to the Repurchase Obligations (A) shall be absolute and
unconditional to the extent set forth in this Agreement and the other
Transaction Documents and shall remain in full force and effect (or be
reinstated) until all Repurchase Obligations shall have been paid, performed
and/or satisfied, as applicable, in full, and (B) until such payment,
performance and/or satisfaction, as applicable, has occurred, shall not be
discharged, affected, modified or impaired on the occurrence from time to time
of any event, including any of the following, whether or not with notice to or
the consent of each Seller, (1) the waiver, compromise, settlement, release,
termination or amendment (including any extension or postponement of the time
for payment, performance, satisfaction, renewal or refinancing) of any of the
Repurchase Obligations (other than a waiver, compromise, settlement, release or
termination in full of the Repurchase Obligations), (2) the failure to give
notice to each Seller of the occurrence of an Event of Default, (3) the release,
substitution or exchange by Buyer of any Purchased Loan (whether with or without
consideration) or the acceptance by Buyer of any additional collateral or the
availability or claimed availability of any other collateral or source of
repayment or any non-perfection or other impairment of collateral, (4) the
release of any Person primarily or secondarily liable for all or any part of the
Repurchase Obligations, whether by Buyer or in connection with any Act of
Insolvency affecting any Seller or any other Person who, or any of whose
property, shall at the time in question be obligated in respect of the
Repurchase Obligations or any part thereof, or (5) to the extent permitted by
Requirement of Law, any other event, occurrence, action or circumstance that
would, in the absence of this Section 32, result in the release or discharge of
any or all Sellers from the performance or observance of any Repurchase
Obligation, (iii) Buyer shall not be required first to initiate any suit or to
exhaust its remedies against any Seller or any other Person to become

 

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liable, or against any of the Purchased Loans, in order to enforce the
Transaction Documents and each Seller expressly agrees that, notwithstanding the
occurrence of any of the foregoing, each Seller shall be and remain directly and
primarily liable for all sums due under any of the Transaction Documents,
(iv) when making any demand hereunder against any Seller, Buyer may, but shall
be under no obligation to, make a similar demand on any other Seller, and any
failure by Buyer to make any such demand or to collect any payments from any
other Seller, or any release of any such other Seller shall not relieve any
Seller in a respect of which a demand or collection is not made or Sellers not
so released of their obligations or liabilities hereunder, and shall not impair
or affect the rights and remedies, express or implied, or as a matter of law, of
Buyer against Sellers, and (v) on disposition by Buyer of any property
encumbered by any Purchased Loans, each Seller shall be and shall remain jointly
and severally liable for any deficiency to the extent set forth in this
Agreement and the other Transaction Documents.

(b) Buyer hereby acknowledges and agrees that the provisions of this Section 32
and the obligation of each Seller to be jointly and severally liable for the
Repurchase Obligations do not and shall not violate any of the provisions of
Section 13 of this Agreement or otherwise cause any Seller to no longer be a
Special Purpose Entity.

 

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

 

BUYER: CITIBANK, N.A. By:  

/s/ Richard B. Schlenger

Name:   Richard B. Schlenger Title:   Authorized Signatory

[SIGNATURES CONTINUE ON NEXT PAGE]

 

[Signature Page to Third Amended and Restated Master Repurchase Agreement]

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SELLER: PARLEX 2 FINANCE, LLC, a Delaware limited liability company By:  

/s/ Douglas N. Armer

  Name:   Douglas N. Armer   Title:   Managing Director, Head of Capital Markets
and Treasurer PARLEX 2A FINCO, LLC, a Delaware limited liability company By:  

/s/ Douglas N. Armer

  Name:   Douglas N. Armer   Title:   Managing Director, Head of Capital Markets
and Treasurer PARLEX 2 UK FINCO, LLC, a Delaware limited liability company By:  

/s/ Douglas N. Armer

  Name:   Douglas N. Armer   Title:   Managing Director, Head of Capital Markets
and Treasurer PARLEX 2 EUR FINCO, LLC, a Delaware limited liability company By:
 

/s/ Douglas N. Armer

  Name:   Douglas N. Armer   Title:   Managing Director, Head of Capital Markets
and Treasurer PARLEX 2 AU FINCO, LLC, a Delaware limited liability company By:  

/s/ Douglas N. Armer

  Name:   Douglas N. Armer   Title:   Managing Director, Head of Capital Markets
and Treasurer

 

[Signature Page to Third Amended and Restated Master Repurchase Agreement]

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ANNEXES AND EXHIBITS

 

ANNEX I    Names and Addresses for Communications between Parties and Wire
Instructions SCHEDULE I    Prohibited Transferees EXHIBIT I    Form of
Confirmation EXHIBIT II    Authorized Representatives of Sellers EXHIBIT III   
Form of Custodial Delivery EXHIBIT IV    Eligible Loan Due Diligence Checklist
EXHIBIT V-A    Form of Power of Attorney for U.S. Purchased Loans EXHIBIT V-B   
Form of Power of Attorney for Foreign Purchased Loans EXHIBIT VI-I   
Representations and Warranties Regarding Each Individual Purchased Loan Which Is
Not a Foreign Purchased Loan (AU) or a Participation Interest in a Whole Loan
EXHIBIT VI-II    Representations and Warranties Regarding Each Individual
Purchased Loan Which Is a Participation Interest in a Whole Loan EXHIBIT VI-III
   Representations and Warranties Regarding Each Individual Purchased Loan Which
Is a Foreign Purchased Loan (AU) EXHIBIT VII    Collateral Tape EXHIBIT VIII   
Form of Transaction Request EXHIBIT IX    Form of Request for Margin Excess
EXHIBIT X    Form of Irrevocable Direction Letter EXHIBIT XI    Form of Joinder
Agreement EXHIBIT XII    Form of Facility Asset Chart

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ANNEX I

Names and Addresses for Communications Between Parties and Wire Instructions

Buyer:

Citibank, N.A.

388 Greenwich Street

New York, New York 10013

Attention: Richard Schlenger

Tel: (212) 816-7806

Email: Richard.Schlenger@Citi.com

and

Sidley Austin LLP

787 Seventh Avenue

New York, New York 10019

Attention: Brian Krisberg, Esq.

Tel: (212) 839-8735

Email: Brian.Krisberg@Sidley.com

Sellers:

Parlex 2 Finance, LLC, Parlex 2A Finco, LLC, Parlex 2 UK Finco, LLC, Parlex 2
EUR Finco, LLC and Parlex 2 AU Finco, LLC

c/o Blackstone Mortgage Trust, Inc.

345 Park Avenue

New York, NY 10154

Attention: Douglas Armer

Tel: (212) 583-5000

Email: BXMTCitiRepo@blackstone.com

With copies to:

Ropes & Gray LLP

1211 Avenue of the Americas

New York, New York 10036

Attention: Daniel L. Stanco

Tel: (212) 841-5758

Email: daniel.stanco@ropesgray.com

Payments to Buyer: Payments to Buyer under this Agreement shall be made by
transfer, via wire transfer, to the following account of Buyer: Citibank, New
York, ABA #: 021000089, Account #: 36855692, Account Name: Citi, NA, Ref: Loan
No. BXMT, Credit to: Mortgage Ops.

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Payments to Parlex 2 Finance, LLC and Parlex 2A Finco, LLC: Payments to each of
Parlex 2 Finance, LLC and Parlex 2A Finco, LLC under this Agreement shall be
made by transfer, via wire transfer, to the following account: Bank of America,
ABA #: 026009593, Account #: 483024227101, Account Name: “Blackstone Mortgage
Trust, Inc.”.

Payments to Parlex 2 UK Finco, LLC: Payments to Parlex 2 UK Finco, LLC under
this Agreement shall be made by transfer, via wire transfer, to the following
account: Bank of America, Bank Sort Code #: 165050, IBAN #: GB69 BOFA 1650 5022
0960 11, Bank SWIFT ID: BOFAGB22, Account #: 22096011, Account Name: “Ambassador
GBP Holdings, LLC”.

Payments to Parlex 2 EUR Finco, LLC: Payments to Parlex 2 EUR Finco, LLC under
this Agreement shall be made by transfer, via wire transfer, to the following
account: Bank of America, IBAN #: GB77 BOFA 1650 5022 0780 19, Bank SWIFT ID:
BOFAGB22, Account Name: “Ambassador EUR Holdings, LLC”.

Payments to Parlex 2 AU Finco, LLC: Payments to Parlex 2 EUR Finco, LLC under
this Agreement shall be made by transfer, via wire transfer, to the following
account: Bank of America N.A., Australian Branch, BSB #: 232 001, Bank SWIFT ID:
BOFAAUSX, Account #: 18331014, Account Name: “Ambassador AUD Holdings, LLC”.

--------------------------------------------------------------------------------

SCHEDULE I

Prohibited Transferees

All Affiliates, successors and assigns of the entities listed on this Schedule I
and such other Persons indicated by Seller from time to time and approved by
Buyer, such approval not to be unreasonably withheld, shall be Prohibited
Transferees, as defined and used in the Agreement.

 

ACORE Capital, LP

  

Ladder Capital Securities LLC

Angelo, Gordon & Co., L.P.

  

LoanCore Capital, LLC

Annaly Capital Management, Inc.

  

Lone Star U.S. Acquisitions, LLC

Apollo Commercial Real Estate Finance, Inc.

  

Macquarie Group Limited

Arbor Realty Trust Inc.

  

Mesa West Capital, LLC

Ares Commercial Real Estate Corporation

  

NCH Capital Inc.

Baupost Group, LLC

  

Newcastle Investment Corp.

Brookfield Investment Management Inc.

  

Oaktree Capital Management, L.P.

Cantor Fitzgerald & Co.

  

OZ Management LP

CapitalSource Inc.

  

Pacific Investment Management Company LLC

Carlyle Realty Partners L.P.

  

RAIT Financial Trust

Cerberus Capital Management, LLP

  

Redwood Trust Inc.

Children’s Investment Fund LP

  

Related Fund Management, LLC

CIM Group, Inc.

  

Rialto Capital Management, LLC

Colony Financial, Inc.

  

Rockwood Capital LLC

Colony NorthStar, Inc.

  

SL Green Realty Corp.

CreXus Investment Corp.

  

Square Mile Capital Management, LLC

Fortress Credit Corp.

  

Starwood Capital Group

Guggenheim Partners, LLC

  

Starwood Property Trust, Inc.

H/2 Credit Manager LP

  

TPG Capital Management, L.P.

iStar Financial Inc.

  

Westbrook Partners LLC

Invesco Ltd.

  

Winthrop Capital Management, LLC

KKR & Co. L.P.

  

--------------------------------------------------------------------------------

EXHIBIT I

CONFIRMATION STATEMENT

Ladies and Gentlemen:

Citibank, N.A., is pleased to deliver our written CONFIRMATION of our agreement
to enter into the Transaction pursuant to which Citibank, N.A. shall purchase
from you, [                    ], LLC (“Seller”), the Purchased Loans identified
on Schedule 1, pursuant to the terms of that certain Third Amended and Restated
Master Repurchase Agreement, dated as of October 12, 2018 (the “Agreement”),
among Citibank, N.A. (“Buyer”) and Seller, [list Seller entities other than the
“Seller” defined hereunder] and any Person that joins as a Seller (as such term
is defined in the Agreement) under the Agreement from time to time, as follows
below and on the attached Schedule 1. Capitalized terms used herein without
definition have the meanings given in the Agreement.

 

Purchased Loan:

                        (as identified on attached Schedule 1)

Aggregate Principal Amount of Purchased Loan:

   [$/£/€/A$____]

Governing Agreements:

   As identified on attached Schedule 1

Purchase Date:

   __________, 20__

Repurchase Date:

   The earlier of (x) the Facility Expiration Date and (y) the maturity date of
the Purchased Loan

Purchase Price Percentage:

   [____%]

Maximum Purchase Price Percentage:

   [____%]

Pricing Rate:

   [one/three] month [LIBOR/EURIBOR/BBSY] plus [____%]

Margin Percentage:

   [____%]

LTV (Purchase Price):

   [____%]

Maximum LTV (Purchase Price):

   [____%]

LTV (Aggregate Loan UPB):

   [____%]

LTV (Loan UPB):

   [____%]

Purchase Price:

   [$/£/€/A$____] (see Transaction Activity Log on Schedule 2)

 

I-1

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Maximum Purchase Price as of Purchase Date:

   [$/£/€/A$____]

Funding Fee:

   [$/£/€/A$____]

Applicable Currency:

   [U.S. Dollars/Pounds Sterling/Euros/AU Dollars]

[Purchase Date Spot Rate (U.S. Dollars):

   [____]]1

[Purchase Date Spot Rate (AU):

   [____]]2

[Purchase Date Spot Rate (EUR):

   [____]]3

[Purchase Date Spot Rate (GBP):

   [____]]4

Future Funding Conditions Precedent:

   [________]

[Additional Transaction Conditions Precedent:

   As identified on attached Schedule 1]5

[Other Applicable Business Day:

   As identified on attached Schedule 1]6

Type of Funding:

   [Table Funding/Non-Table Funding]

Wiring Instructions7

   As identified on attached Schedule 3

 

1

For Foreign Purchased Loans.

2 

For Foreign Purchased Loans denominated in AU Dollars where underlying Mortgaged
Property is denominated in currency other than AU Dollars.

3 

For Foreign Purchased Loans denominated in Euro where underlying Mortgaged
Property is denominated in currency other than Euro.

4 

For Foreign Purchased Loans denominated in Pounds Sterling where underlying
Mortgaged Property is denominated in currency other than Pounds Sterling.

5

As mutually agreed upon by Buyer and Seller.

6

For Foreign Purchased Loans, as necessary pursuant to clause (iii) of the
definition of “Business Day”.

7 

If different than the standard wiring instructions on Annex I to the Master
Repurchase Agreement, Confirmation requires signature of two officers of Seller.

 

I-2

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Name and address for communications:     Buyer:   Citibank, N.A.       388
Greenwich Street       New York, New York 10013       Attention: Richard
Schlenger       Tel: (212) 816-7806       Email: Richard.Schlenger@Citi.com    
Seller:   [                    ], LLC       c/o Blackstone Mortgage Trust, Inc.
      345 Park Avenue       New York, NY 10154       Attention: Douglas Armer  
    Tel: (212) 583-5000       Email:       BXMTCitiRepo@blackstone.com

 

I-3

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CITIBANK, N.A.

By:  

 

Name:  

 

Title:  

 

 

AGREED AND ACKNOWLEDGED:

[                    ], LLC,

a Delaware limited liability company

By:  

 

Name:   Title:  

[By:  

 

Name:   Title:]8  

 

8 

Second signature of Seller is only needed if Seller is directing Buyer to fund
to an account other than Seller’s account specified in Annex I to the Master
Repurchase Agreement.

 

I-4

--------------------------------------------------------------------------------

Schedule 1 to Confirmation Statement

Purchased Loan:

[Maximum] Aggregate Principal Amount:

[Additional Transaction Conditions Precedent:]

[Other Applicable Business Day:]

 

I-5

--------------------------------------------------------------------------------

Schedule 2 to Confirmation Statement

 

I-6

--------------------------------------------------------------------------------

Schedule 3 to Confirmation Statement

Wiring Instructions

Bank Name: _____________

ABA No/BIC/SWIFT: _____________

Acct. No: _______________

Account Name: _____________

 

I-7

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EXHIBIT II

AUTHORIZED REPRESENTATIVES OF SELLERS

 

Name

      

Office

       

Specimen Signature

Stephen D. Plavin      Chief Executive Officer, President and Director      

/s/ Stephen D. Plavin

Douglas N. Armer           Managing Director, Head of Capital Markets and
Treasurer      

/s/ Douglas N. Armer

Anthony F. Marone, Jr.      Managing Director and Chief Financial Officer      

/s/ Anthony F. Marone, Jr.

Leon Volchyok      Principal, Head of Legal and Compliance and Secretary      

/s/ Leon Volchyok

Thomas C. Ruffing      Managing Director, Head of Asset Management      

/s/ Thomas C. Ruffing

Weston Tucker      Managing Director, Head of Investor Relations      

/s/ Weston Tucker

 

II-1

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EXHIBIT III

FORM OF CUSTODIAL DELIVERY

On this [            ] day of [                ], 20[    ],
[                                    ], LLC, a Delaware limited liability
company (“Seller”), pursuant to (i) that certain Second Amended and Restated
Custodial Agreement, dated as of October 12, 2018 (as amended, modified or
supplemented from time to time, the “Custodial Agreement”), among Seller, [list
Seller entities other than “Seller” defined hereunder], U.S. Bank National
Association, as Custodian, and Citibank, N.A. (“Buyer”) and (ii) that certain
Third Amended and Restated Master Repurchase Agreement, dated as of October 12,
2018 (as amended, modified or supplemented from time to time, the “Repurchase
Agreement”), among Seller, [list Seller entities other than “Seller” defined
hereunder], any Person that joins as a Seller (as such term is defined in the
Agreement) under the Repurchase Agreement from time to time, and Buyer, does
hereby deliver the documents comprising the Purchased Loan File(s) (and listed
on Exhibit B hereto with respect to the Purchased Loan(s) identified in Exhibit
A hereto) to (a) the applicable Acceptable Attorney, for such Acceptable
Attorney to hold and deliver to Custodian as set forth therein, and (b) the
Custodian (through such Acceptable Attorney aforesaid, pursuant to Section 7(b)
of the Repurchase Agreement and that certain Attorney’s Bailee Letter between
such Acceptable Attorney and Seller dated as of [                    ], 20[    ]
(the “Attorney’s Bailee Letter”)). Seller hereby instructs such Acceptable
Attorney to comply with the terms of the Attorney’s Bailee Letter, and hereby
instructs Custodian to comply with the Custodial Agreement, in each case,
holding the Purchased Loan File(s) for the benefit of Buyer.

With respect to the Purchased Loan File(s) delivered herewith, for purposes of
issuing its Trust Receipt, Custodian shall review the Purchased Loan File(s) to
confirm receipt of each of the documents identified on Exhibit B hereto.

Capitalized terms used herein and not otherwise defined shall have the meanings
set forth in the Custodial Agreement.

[Remainder of this page intentionally left blank.]

 

III-1

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IN WITNESS WHEREOF, Seller has caused this Custodial Delivery Certificate to be
executed and delivered by its duly authorized officer as of the day and year
first above written.

 

[                    ], LLC,

a Delaware limited liability company

By:  

 

Name:   Title:  

 

III-2

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EXHIBIT IV

ELIGIBLE LOAN DUE DILIGENCE CHECKLIST

General Information

Asset Summary Report

Site Inspection Report

Maps and Photos

Borrower/Sponsor Information

Credit Reports

Financial Statements & Tax Returns

Borrower Structure or Org Chart

Bankruptcy and Foreclosure History

Corporate authorizations and solvency certificates delivered at closing of the
Purchased Loan (Foreign Purchased Loan)

Property Information

Historical Operating Statements

Rent Rolls

Budget

Insurance Review

Retail Sales Figures

Market Survey

Insurance valuation (Foreign Purchased Loan)

Archaeological survey/ground condition report/structural survey/rights of light
report/any other professional report delivered at the closing of the Purchased
Loan (Foreign Purchased Loan) Certificate of Title/Report on Title and overview
report of the same delivered at the closing of the Purchased Loan (Foreign
Purchased Loan)

Evidence of the release of all prior security affecting all Mortgaged Property
and other assets securing the Purchased Loan (Foreign Purchased Loan)

All necessary Land Registry application forms in relation to the transfer of and
the charging of all Mortgaged Property securing the Purchased Loan (Foreign
Purchased Loan)

A land transaction return in relation to any stamp duty land tax payable in
connection with the transfer of any Mortgaged Property to the Mortgagor (Foreign
Purchased Loan)

Copies of all authorisations necessary for the transfer and/or charging of all
Mortgaged Property and other assets securing the Purchased Loan delivered at
closing of the Purchased Loan (Foreign Purchased Loan)

Leasing Information

Stacking Plan

Major Leases

Tenant Estoppels

Standard Lease Forms

 

IV-1

--------------------------------------------------------------------------------

SNDA’s

Copies of all notices to the reversioner of any lease and copies of last rent
demands (Foreign Purchased Loan)

Third Party Reports

Appraisals

Environmental Site Assessments

Engineering Reports

Seismic Reports

Other Information

Hotel Franchise Compliance Reports

Hotel Franchise Agreement

Hotel Franchise Comfort Letters

Ground Lease

Management Contract

Disclosures provided for in Exhibit VI (Foreign Purchased Loan)

Undertaking from solicitors holding the original title documentation (Foreign
Purchased Loan)

Managing agent agreement and associated duty of care agreement (Foreign
Purchased Loan)

All tax forms (including VAT registration certificates and double tax treaty
confirmations) (Foreign Purchased Loan)

Documentation

Purchase and Sale Agreement

Closing Statement

Legal Binder

 

IV-2

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EXHIBIT V-A

FORM OF POWER OF ATTORNEY FOR U.S. PURCHASED LOANS

Know All Men by These Presents, that [                    ], LLC (“Seller”),
does hereby appoint Citibank, N.A. (“Buyer”), its attorney-in-fact to act in
Seller’s name, place and stead in any way which Seller could do during the
occurrence and continuance of an Event of Default and, subject to the following
sentence, during the occurrence and continuance of a monetary Default or
material non-monetary Default, with respect to (i) the completion of the
endorsements of the Mortgage Notes and the Assignments of Mortgages, (ii) the
recordation of the Assignments of Mortgages, and (iii) the enforcement of
Seller’s rights under the Purchased Loans purchased by Buyer pursuant to the
Third Amended and Restated Master Repurchase Agreement dated as of October 12,
2018 (as amended, restated, supplemented or otherwise modified and in effect
from time to time, the “Repurchase Agreement”), among Buyer, Seller, [list
Seller entities other than “Seller” defined hereunder] and any Person that joins
as a Seller under the Repurchase Agreement from time to time, and to take such
other steps as may be necessary or desirable to enforce Buyer’s rights against
such Purchased Loans, the related Purchased Loan Files and the Servicing Records
to the extent that Seller is permitted by law to act through an agent. If a
monetary Default or a material non-monetary Default has occurred and is
continuing and Buyer has requested in writing that Seller take or cause to be
taken any action that Buyer deems reasonably necessary to preserve Buyer’s
ability to enforce upon the Purchased Loans as and when permitted pursuant to
Section 14(b) of the Repurchase Agreement (which writing shall include a
statement that Buyer will exercise its power of attorney if Seller fails to take
or cause to be taken such action requested by Buyer), and Seller has not
complied with any such request promptly following receipt thereof, then Buyer
may exercise its power of attorney during the existence and continuation of any
such monetary Default or material non-monetary Default, as the case may be, as
Buyer deems reasonably necessary to preserve Buyer’s ability to enforce upon the
Purchased Loans as and when permitted pursuant to Section 14(b) of the
Repurchase Agreement.

Capitalized terms used herein and not otherwise defined shall have the meanings
set forth in the Repurchase Agreement.

TO INDUCE ANY THIRD PARTY TO ACT HEREUNDER, SELLER HEREBY AGREES THAT ANY THIRD
PARTY RECEIVING A DULY EXECUTED COPY OF FACSIMILE OF THIS INSTRUMENT MAY ACT
HEREUNDER, AND THAT REVOCATION OR TERMINATION HEREOF SHALL BE INEFFECTIVE AS TO
SUCH THIRD PARTY UNLESS AND UNTIL ACTUAL NOTICE OR KNOWLEDGE OR SUCH REVOCATION
OR TERMINATION SHALL HAVE BEEN RECEIVED BY SUCH THIRD PARTY, AND SELLER ON ITS
OWN BEHALF AND ON BEHALF OF SELLER’S ASSIGNS, HEREBY AGREES TO HOLD HARMLESS ANY
SUCH THIRD PARTY FROM AND AGAINST ANY AND ALL CLAIMS THAT MAY ARISE AGAINST SUCH
THIRD PARTY BY REASON OF SUCH THIRD PARTY HAVING RELIED ON THE PROVISIONS OF
THIS INSTRUMENT.

 

V-1

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IN WITNESS WHEREOF Seller has caused this Power of Attorney to be executed as a
deed this      day of                     , 20[    ].

 

[                                         ],

a Delaware limited liability company

By:  

 

Name:   Title:  

 

V-2

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EXHIBIT V-B

FORM OF POWER OF ATTORNEY FOR FOREIGN PURCHASED LOANS9

THIS POWER OF ATTORNEY is made and given on [            ], 20[    ], by [Parlex
2 UK Finco, LLC/Parlex 2 EUR Finco, LLC/Parlex 2 AU Finco, LLC], a limited
liability company incorporated under the laws of Delaware whose registered
office is at [        ] (the “Seller”) in favour of Citibank, N.A., whose
registered office is at [        ] (the “Attorney”), for the purposes and on the
terms hereinafter set forth.

 

(A)

By the Third Amended and Restated Master Repurchase Agreement dated as of
October 12, 2018 (as amended, restated, supplemented or otherwise modified and
in effect from time to time, the “Agreement”), Seller agreed to sell, and the
Attorney agreed to purchase, the Purchased Loans on terms requiring Seller to
repurchase the same on the terms set out therein.

 

(B)

In connection with the agreement of the Attorney to purchase the Purchased
Loans, Seller has agreed to enter into these presents for the purposes
hereinafter appearing.

NOW THIS DEED WITNESSETH and SELLER HEREBY APPOINTS the Attorney to be its true
and lawful attorney in the name of Seller or otherwise, for and on behalf of
Seller to do any of the following acts, deeds and things or any of them:

date and deliver to the facility agent [and/or security trustee (if
applicable)]10 for execution any Transfer Certificate executed by Seller,

take any action (including exercising voting and/or consent rights) with respect
to any participation interest,

complete the preparation and filing, in form and substance satisfactory to
Buyer, of such financing statements, continuation statements, [financing change
statements]11 and other UCC forms [(or forms required for registration on the
PPS Register)]12, as Buyer may from time to time, reasonably consider necessary
to create, perfect, and preserve Buyer’s security interest in the Purchased
Loans,

enforce Seller’s rights under the Purchased Loans purchased by Buyer pursuant to
the Agreement,

 

9 

On the Purchase Date for each Foreign Purchased Loan secured by Mortgaged
Property located outside of the United Kingdom, Belgium and Australia, this
Exhibit V-A shall be reasonably revised as mutually agreed upon by Buyer and
Seller to reflect any equivalent terminology, customary market practices and
Requirements of Law in the relevant non-U.S. jurisdiction, in each case
applicable to such Foreign Purchased Loan.

10

Include for each Foreign Purchased Loan (AU).

11

Include for each Foreign Purchased Loan (AU).

12

Include for each Foreign Purchased Loan (AU).

 

V-1

--------------------------------------------------------------------------------

to take such other steps as may be necessary or desirable to fully and
effectively transfer Seller’s rights, title and interests in the Purchased Loans
to Buyer or to enforce Buyer’s rights against, under or with respect to such
Purchased Loans and the related Purchased Loans Files and the Servicing Records
or to enforce Seller’s rights under the Purchased Loans purchased by Buyer
pursuant to the Agreement,

provided that Attorney agrees not to exercise its rights under this instrument
unless a monetary Default, material non-monetary Default or an Event of Default
has occurred and is continuing.

The Attorney shall have the power in writing under seal by an officer of the
Attorney from time to time to appoint a substitute (each, a “Substitute
Attorney”) who shall have the power to act on behalf of Seller (whether
concurrently with or independently of the Attorney) as if that Substitute
Attorney shall have been originally appointed as the Attorney by this Deed
and/or to revoke any such appointment at any time without assigning any reason
therefor provided the Attorney shall continue to be liable for the negligence,
wilful misconduct or bad faith of any such Substitute Attorney appointed by it.

Seller hereby agrees at all times hereafter to ratify and confirm whatever the
Attorney or any Substitute Attorney lawfully does or purports to do in the
exercise of any power conferred by this Power of Attorney.

SELLER DECLARES THAT:

This Power of Attorney shall be irrevocable and is given as security for the
interests of the Attorney under the Agreement and will survive and not be
affected by the subsequent bankruptcy or insolvency or dissolution of Seller.

Words and expressions defined in the Agreement shall have the same meanings in
this Power of Attorney except so far as the context otherwise requires.

This Power of Attorney is governed by and shall be construed in accordance with
[                    ] law.

 

V-2

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IN WITNESS WHEREOF Seller has caused this Power of Attorney to be executed as a
deed this [    ] day of [                    ], 20[    ].

 

[PARLEX 2 UK FINCO, LLC/PARLEX 2 EUR       FINCO, LLC/PARLEX 2 AU FINCO, LLC], a
      Delaware limited liability company13 By:     Name:  

 

  Title:  

 

 

13

For each Foreign Purchased Loan (AU), add execution block for a witness.

 

V-3

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EXHIBIT VI-I

REPRESENTATIONS AND WARRANTIES

REGARDING EACH INDIVIDUAL PURCHASED LOAN WHICH IS NOT A FOREIGN

PURCHASED LOAN (AU) OR A PARTICIPATION INTEREST IN A WHOLE LOAN

On the Purchase Date for each Foreign Purchased Loan (EUR) or Foreign Purchased
Loan (GBP) secured by Mortgaged Property located outside of the United Kingdom,
the representations and warranties set forth on this Exhibit VI-I shall be
revised to the extent necessary, as mutually agreed upon by Buyer and Seller, to
reflect any equivalent terminology, customary market practices and Requirements
of Law in the relevant non-U.S. jurisdiction, in each case applicable to such
Foreign Purchased Loan.

With respect to Foreign Purchased Loans, any reference in this Exhibit to a
“Mortgage” shall be deemed to refer to all security documents entered into in
connection with such Foreign Purchased Loan and any reference to Mortgaged
Property shall mean the real property and other assets and rights securing
repayment of the Foreign Purchased Loan.

 

(1)

Whole Loan; Ownership of Purchased Loans. Except with respect to a Purchased
Loan that is part of a Whole Loan, each Purchased Loan is a whole loan and not a
participation interest in a Purchased Loan. Each Purchased Loan that is part of
a Whole Loan is a senior portion of a whole mortgage loan evidenced by a senior
note or, with respect to any Foreign Purchased Loan, other applicable Purchased
Loan Document. At the time of the sale, transfer and assignment to Buyer, no
Mortgage Note or Mortgage (or, with respect to a Foreign Purchased Loan, any
other applicable Purchased Loan Document) was subject to any assignment,
participation or pledge, and Seller had good title to, and was the sole owner
(or, in relation to a Foreign Purchased Loan, the sole legal and beneficial
owner) of, each Purchased Loan free and clear of any and all liens, charges,
pledges, encumbrances, participations, any other ownership interests on, in or
to such Purchased Loan other than any servicing rights appointment or similar
agreement and rights of the holder of a related “B note” in an “A/B” structure
in a commercial real estate loan (a “Junior Interest”). Seller has full right
and authority to sell, assign and transfer each Purchased Loan, and the
assignment to Buyer constitutes a legal, valid and binding assignment of such
Purchased Loan free and clear of any and all liens, pledges, charges or security
interests of any nature encumbering such Purchased Loan other than the rights of
the holder of a related Junior Interest.

 

(2)

Loan Document Status. Each related Mortgage Note, Mortgage, Assignment of Leases
(if a separate instrument), guaranty and other agreement executed by or on
behalf of the related Mortgagor, guarantor or other obligor in connection with
such Purchased Loan is the legal, valid and binding obligation of the related
Mortgagor, guarantor or other obligor (subject to any non-recourse provisions
contained in any of the foregoing

 

VI-I-1

--------------------------------------------------------------------------------

agreements and any applicable state anti-deficiency or market value limit
deficiency legislation), as applicable, and is enforceable in accordance with
its terms, except (i) as such enforcement may be limited by (a) bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium or other similar
laws affecting the enforcement of creditors’ rights generally and (b) general
principles of equity (regardless of whether such enforcement is considered in a
proceeding in equity or at law) and (ii) that certain provisions in such
Purchased Loan Documents (including, without limitation, provisions requiring
the payment of default interest, late fees or prepayment/yield maintenance fees,
charges and/or premiums) are, or may be, further limited or rendered
unenforceable by or under applicable law, but (subject to the limitations set
forth in clause (i) above) such limitations or unenforceability will not render
such Purchased Loan Documents invalid as a whole or materially interfere with
the Mortgagee’s realization of the principal benefits and/or security provided
thereby (clauses (i) and (ii) collectively, the “Standard Qualifications”).

Except as set forth in the immediately preceding sentence, there is no valid
offset, defense, counterclaim or right of rescission available to the related
Mortgagor with respect to any of the related Mortgage Notes, Mortgages or other
Purchased Loan Documents, including, without limitation, any such valid offset,
defense, counterclaim or right based on intentional fraud by Seller in
connection with the origination of the Purchased Loan, that would deny the
Mortgagee the principal benefits intended to be provided by the Mortgage Note,
Mortgage or other Purchased Loan Documents.

 

(3)

Mortgage Provisions. The Purchased Loan Documents for each Purchased Loan
contain provisions that render the rights and remedies of the holder thereof
adequate for the practical realization against the Mortgaged Property of the
principal benefits of the security intended to be provided thereby, including
realization by judicial or, if applicable, nonjudicial foreclosure subject to
the limitations set forth in the Standard Qualifications.

 

(4)

Mortgage Status; Waivers and Modifications. Since origination and except by
written instruments set forth in the related Purchased Loan File (a) the
material terms of such Mortgage, Mortgage Note, Purchased Loan guaranty, and
related Purchased Loan Documents have not been waived, impaired, modified,
altered, satisfied, canceled, subordinated or rescinded in any respect which
materially interferes with the security intended to be provided by such
Mortgage; (b) no related Mortgaged Property or any portion thereof has been
released from the lien of the related Mortgage in any manner which materially
interferes with the security intended to be provided by such Mortgage or the use
or operation of the remaining portion of such Mortgaged Property; and
(c) neither the related Mortgagor nor the related guarantor has been released
from any of its material obligations under the Purchased Loan.

 

VI-I-2

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(5)

Lien; Valid Assignment. Subject to the Standard Qualifications, each assignment
of Mortgage and assignment of Assignment of Leases to the Mortgagee and, with
respect to any Foreign Purchased Loan, assignment of any other applicable
Purchased Loan Document, constitutes a legal, valid and binding assignment to
the Mortgagee. Each related Mortgage and Assignment of Leases and applicable
Purchased Loan Document is freely assignable or transferable without the consent
of or any requirement to consult with or obtain authorization or consent from
the related Mortgagor.

Each related Mortgage is a legal, valid and enforceable first lien or other
first priority security interest on the related Mortgagor’s fee (or if
identified in the Due Diligence Package, leasehold) interest in the Mortgaged
Property in the principal amount of such Purchased Loan or allocated loan amount
(subject only to (i) Permitted Encumbrances (as defined below); (ii) with
respect to any U.S. Purchased Loan, the exceptions to paragraph 6 (“Permitted
Liens; Title Insurance”) of this Exhibit VI set forth in the related report
delivered by Seller to Buyer of any exceptions to the representations and
warranties set forth in this Exhibit VI; and (iii) with respect to any Foreign
Purchased Loan, matters that have been disclosed by or on behalf of the
applicable Seller to Buyer in writing prior to the Purchase Date as part of the
Due Diligence Package (each such exception in the foregoing clauses (i) through
(iii), a “Title Exception”)), except as the enforcement thereof may be limited
by the Standard Qualifications. Except as otherwise set forth in the Title
Policy (as hereinafter defined) relating to any U.S. Purchased Loan, or, with
respect to any Foreign Purchased Loan, that has been disclosed by or on behalf
of the applicable Seller to Buyer in writing prior to the Purchase Date as part
of the Due Diligence Package, such Mortgaged Property (subject to and excepting
Permitted Encumbrances and Title Exceptions) as of origination was, and
currently is, free and clear of any recorded mechanics’ liens, recorded
materialmen’s liens (or, with respect to any Foreign Purchased Loan, the
equivalent in the relevant non-U.S. jurisdiction) and other recorded
encumbrances which are prior to or equal with the lien of the related Mortgage,
except those which are bonded over, escrowed for or insured against by a
lender’s title insurance policy (as described below), and, subject to the rights
of tenants (as tenants only) (subject to and excepting Permitted Encumbrances),
no rights exist which under law could give rise to any such lien or encumbrance
that would be prior to or equal with the lien of the related Mortgage, except
those which are bonded over, escrowed for or insured against by a lender’s title
insurance policy (as described below). Notwithstanding anything herein to the
contrary and in relation to U.S Purchased Loans only, no representation is made
as to the perfection of any security interest in rents or other personal
property to the extent that possession or control of such items or actions other
than the filing of Uniform Commercial Code financing statements is required in
order to effect such perfection.

With respect to Foreign Purchased Loans, all actions have been taken and all
filings, recordings and registrations have been made (or will have been
submitted in proper form for filing, recording and/or registration within any
applicable time limits prescribed by applicable Requirements of Law) in all
public places necessary to perfect a valid first priority security interest in
the Mortgaged Property and the security created by such Mortgage.

 

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(6)

Permitted Liens; Title Insurance. In respect of any U.S. Purchased Loan,
Mortgaged Property securing a Purchased Loan is covered by an American Land
Title Association loan title insurance policy or a comparable form of loan title
insurance policy approved for use in the applicable jurisdiction (or, if such
policy is yet to be issued, by a pro forma policy, a preliminary title policy
with escrow instructions or a “marked up” commitment, in each case binding on
the title insurer) (the “Title Policy”) in the original principal amount of such
Purchased Loan (or with respect to a Purchased Loan secured by multiple
properties, an amount equal to at least the allocated loan amount with respect
to the Title Policy for each such property) after all advances of principal
(including any advances held in escrow or reserves), that insures for the
benefit of the owner of the indebtedness secured by the Mortgage, the first
priority lien of the Mortgage, which lien is subject only to (a) the lien of
current real property taxes, water charges, sewer rents and assessments due and
payable but not yet delinquent; (b) covenants, conditions and restrictions,
rights of way, easements and other matters of public record; (c) the exceptions
(general and specific) and exclusions set forth in such Title Policy; (d) other
matters to which like properties are commonly subject; (e) the rights of tenants
(as tenants only) under leases (including subleases) pertaining to the related
Mortgaged Property and condominium declarations; (f) if the related Purchased
Loan is part of a Whole Loan, the rights of the holder of the related Junior
Interest; and (g) if the related Purchased Loan is cross-collateralized and
cross-defaulted with one or more mortgage loans, the lien of the Mortgage for
another mortgage loan contained in the same cross-collateralized and
cross-defaulted group of mortgage loans; provided that none of which items
(a) through (f), individually or in the aggregate, materially and adversely
interferes with the value or current use of the Mortgaged Property or the
security intended to be provided by such Mortgage or the Mortgagor’s ability to
pay its obligations when they become due (collectively, the “Permitted
Encumbrances” (which term, for the avoidance of doubt, is also applicable to
Foreign Purchased Loans for purposes of this Exhibit VI)). Except as
contemplated by clause (g) of the preceding sentence, none of the Permitted
Encumbrances are mortgage liens that are senior to or coordinate and co-equal
with the lien of the related Mortgage. With respect to such U.S. Purchased Loan,
such Title Policy (or, if it has yet to be issued, the coverage to be provided
thereby) is in full force and effect, all premiums thereon have been paid and no
claims have been made by Seller thereunder and no claims have been paid
thereunder. Neither Seller, nor to Seller’s Actual Knowledge, any other holder
of such U.S. Purchased Loan, has done, by act or omission, anything that would
materially impair the coverage under such Title Policy.

 

(7)

Junior Liens. It being understood that B notes secured by the same Mortgage as a
Purchased Loan are not subordinate mortgages or junior liens, except for any
Junior Interests and Purchased Loan that is cross-collateralized and
cross-defaulted with another Purchased Loan, there are, as of origination, and
to Seller’s Actual Knowledge, no subordinate mortgages or junior liens securing
the payment of money encumbering the related Mortgaged Property (other than, as
applicable, Permitted Encumbrances and the Title Exceptions, taxes and
assessments, mechanics and materialmens liens (which are

 

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the subject of the representation in paragraph (5) above), and equipment and
other personal property financing). Except as set forth in the Due Diligence
Package, Seller has no Actual Knowledge of any mezzanine debt secured directly
by interests in the related Mortgagor.

 

(8)

Assignment of Leases and Rents. There exists as part of the related Purchased
Loan File an Assignment of Leases (either as a separate instrument or
incorporated into the related Mortgage) or, with respect to any Foreign
Purchased Loan, other applicable comparable Purchased Loan Document in the
applicable jurisdiction. Subject to the Permitted Encumbrances and the Title
Exceptions, as applicable, and with respect to any Foreign Purchased Loan, to
the extent disclosed by or on behalf of the applicable Seller to Buyer in
writing prior to the Purchase Date as part of the Due Diligence Package, each
related Assignment of Leases or Purchased Loan Document, as applicable, creates
a valid first-priority collateral assignment of, or a valid first-priority lien
or security interest in, rents and certain rights under the related lease or
leases, subject only to a license granted to the related Mortgagor to exercise
certain rights and to perform certain obligations of the lessor under such lease
or leases, including the right to operate the related leased property, except as
the enforcement thereof may be limited by the Standard Qualifications. The
related Mortgage or related Assignment of Leases or Purchased Loan Document, as
applicable, subject to applicable law and the Standard Qualifications, provides
that, upon an event of default under the Purchased Loan, a receiver is permitted
to be appointed for the collection of rents or for the related Mortgagee to
enter into possession to collect the rents or for rents to be paid directly to
the Mortgagee.

 

(9)

UCC Filings / Required Filings. With respect to (i) any Foreign Purchased Loan
regardless of the type of related Mortgaged Property and (ii) any U.S. Purchased
Loan where the related Mortgaged Property is operated as a hospitality property,
Seller has filed and/or recorded or caused to be filed and/or recorded (or, if
not filed and/or recorded, have been submitted in proper form for filing and/or
recording), UCC financing statements (or, with respect to any Foreign Purchased
Loan, the equivalent under Applicable Requirements of Law in the relevant
non-U.S. jurisdiction or Required Filings) in the appropriate public filing
and/or recording offices necessary at the time of the origination of the
Purchased Loan to perfect a valid security interest in all items of physical
personal property reasonably necessary to operate such Mortgaged Property owned
by such Mortgagor and located on the related Mortgaged Property (other than any
non-material personal property, any personal property subject to a purchase
money security interest, a sale and leaseback financing arrangement as permitted
under the terms of the related Purchased Loan Documents or any other personal
property leases applicable to such personal property), to the extent perfection
may be effected pursuant to applicable law by recording or filing, as the case
may be. Subject to the Standard Qualifications, each related Mortgage (or
equivalent document) creates a valid and enforceable lien and security interest
on the items of personalty described above. No representation is made as to the
perfection of any security interest in rents or other personal property to the
extent that possession or control of such items or actions other than the filing
of UCC financing statements (or, with respect to any Foreign Purchased Loan, the
equivalent under Applicable Requirements of Law in the relevant non-U.S.
jurisdiction or Required Filings) are required in order to effect such
perfection.

 

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(10)

Condition of Property. Seller or the originator of the Purchased Loan inspected
or caused to be inspected each related Mortgaged Property within six months of
origination of the Purchased Loan and within thirteen months of the Purchase
Date.

An engineering report or property condition assessment (and, with respect to
Foreign Purchased Loans, such other engineering, property and technical reports
that are customarily prepared in connection with the origination of such Foreign
Purchased Loans) was prepared in connection with the origination of each
Purchased Loan no more than thirteen months prior to the Purchase Date. To
Seller’s Actual Knowledge, based solely upon due diligence customarily performed
in connection with the origination of comparable mortgage loans, and except as
disclosed on any engineering report or property condition assessment (or, with
respect to Foreign Purchased Loans, such other engineering, property and
technical reports) delivered to Buyer, as of the Purchase Date, each related
Mortgaged Property was free and clear of any material damage (other than (i)
deferred maintenance for which escrows were established at origination and
(ii) any damage fully covered by insurance) that would affect materially and
adversely the use or value of such Mortgaged Property as security for the
Purchased Loan.

 

(11)

Taxes and Assessments. All taxes, governmental assessments and other outstanding
governmental charges (including, without limitation, water and sewage charges),
or installments thereof, which could be a lien on the related Mortgaged Property
that would be of equal or superior priority to the lien of the Mortgage and that
prior to the Purchase Date have become delinquent in respect of each related
Mortgaged Property, to Seller’s Actual Knowledge, have been paid, or an escrow
of funds has been established in an amount sufficient to cover such payments and
reasonably estimated interest and penalties, if any, thereon. For purposes of
this representation and warranty, real estate taxes and governmental assessments
and other outstanding governmental charges and installments thereof shall not be
considered delinquent until the earlier of (a) the date on which interest and/or
penalties would first be payable thereon and (b) the date on which enforcement
action is entitled to be taken by the related taxing authority.

 

(12)

Condemnation. To Seller’s Actual Knowledge, as of the Purchase Date, Seller has
not received written notice from any government agency or body of any proceeding
pending or threatened, for the total or partial condemnation of such Mortgaged
Property that would have a material adverse effect on the value, use or
operation of the Mortgaged Property.

 

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(13)

Actions Concerning Purchased Loan. To Seller’s Actual Knowledge as of the
Purchase Date, there was no pending or filed action, suit or proceeding,
arbitration or governmental investigation involving any Mortgagor, guarantor, or
Mortgagor’s interest in the Mortgaged Property, the Mortgage or any other
Purchased Loan Document, an adverse outcome of which would reasonably be
expected to materially and adversely affect (a) such Mortgagor’s title to the
Mortgaged Property, (b) the validity or enforceability of the Mortgage, (c) such
Mortgagor’s ability to perform under the related Purchased Loan, (d) such
guarantor’s ability to perform under the related guaranty, (e) the principal
benefit of the security intended to be provided by the Purchased Loan Documents,
(f) the current principal use of the Mortgaged Property or (g) title or
ownership of Seller and/or Buyer of the Purchased Loan Documents and/or the
rights, title and interests thereunder.

 

(14)

Escrow Deposits. All escrow deposits and payments required to be escrowed with
Mortgagee pursuant to each Purchased Loan are in the possession, or under the
control, of Seller or its servicer, and there are no deficiencies (subject to
any applicable grace or cure periods) in connection therewith, and all such
escrows and deposits (or the right thereto) that are required to be escrowed
with Mortgagee under the related Purchased Loan Documents are being conveyed by
Seller to Buyer or its servicer.

 

(15)

No Holdbacks. Except as for Purchased Loans identified to Buyer in connection
with the subject transaction as having future advances, the principal amount of
the Purchased Loan stated in the Due Diligence Package has been fully disbursed
as of the Purchase Date and there is no requirement for future advances
thereunder (except in those cases where the full amount of the Purchased Loan
has been disbursed but a portion thereof is being held in escrow or reserve
accounts pending the satisfaction of certain conditions relating to leasing,
repairs or other matters with respect to the related Mortgaged Property, the
Mortgagor or other considerations determined by Seller to merit such holdback).

 

(16)

Insurance. Each related Mortgaged Property is, and is required pursuant to the
related Mortgage to be, insured by a property insurance policy providing
coverage for loss in accordance with coverage found under a “special cause of
loss form” or “all risk form” that includes replacement cost valuation issued by
an insurer meeting the requirements of the related Purchased Loan Documents and
having a claims-paying or financial strength rating of at least “A-:VIII” from
A.M. Best Company or “A3” (or the equivalent) from Moody’s Investors Service,
Inc. or “A-” from Standard & Poor’s Ratings Service (with respect to any Foreign
Purchased Loan, other equivalent rating from a comparable rating company)
(collectively, the “Insurance Rating Requirements”), in an amount (subject to a
customary deductible) not less than the lesser of (1) the outstanding principal
balance of the Purchased Loan and (2) the full insurable value on a replacement
cost basis of the improvements, furniture, furnishings, fixtures and equipment
owned by the Mortgagor and included in the Mortgaged Property (with no deduction
for physical depreciation), but, in any event, not less than the amount
necessary or containing such endorsements as are necessary to avoid the
operation of any coinsurance provisions with respect to the related Mortgaged
Property.

 

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Each related Mortgaged Property is also covered, and required to be covered
pursuant to the related Purchased Loan Documents, by business interruption or
rental loss insurance which (subject to a customary deductible) covers a period
of not less than 12 months (or with respect to each Purchased Loan on a single
asset with a principal balance of $50 million (or, with respect to any Foreign
Purchased Loan, its then- current equivalent based on the Spot Rate with respect
to the Applicable Currency of such Foreign Purchased Loan as of the date of
determination) or more, 18 months).

If any material part of the improvements, exclusive of a parking lot, located on
a Mortgaged Property is in an area identified in the Federal Register by the
Federal Emergency Management Agency (or other applicable body with respect to a
Foreign Purchased Loan) as “a Special Flood Hazard Area” or, with respect to any
such Foreign Purchased Loan, otherwise as having special flood hazards, the
related Mortgagor is required to maintain insurance in the maximum amount
available under the National Flood Insurance Program (or, with respect to a
Foreign Purchased Loan, in such amount as is customary in the applicable
non-U.S. jurisdiction).

If the Mortgaged Property is located within 25 miles of the coast of the Gulf of
Mexico or the Atlantic coast of Florida, Georgia, South Carolina or North
Carolina, the related Mortgagor is required to maintain coverage for windstorm
and/or windstorm related perils and/or “named storms” issued by an insurer
meeting the Insurance Rating Requirements or endorsement covering damage from
windstorm and/or windstorm related perils and/or named storms.

The Mortgaged Property is covered, and required to be covered pursuant to the
related Purchased Loan Documents, by a commercial general liability insurance
policy issued by an insurer meeting the Insurance Rating Requirements including
coverage for property damage, contractual damage and personal injury (including
bodily injury and death) in amounts as are generally required by prudent
institutional commercial mortgage lenders, and in any event not less than
$1 million per occurrence and $2 million in the aggregate (or, in each case,
with respect to any Foreign Purchased Loan, its then-current equivalent based on
the Spot Rate with respect to the Applicable Currency of such Foreign Purchased
Loan as of the date of determination).

With respect to a U.S. Purchased Loan, an architectural or engineering
consultant has performed an analysis of each of the Mortgaged Properties located
in seismic zones 3 or 4 in order to evaluate the structural and seismic
condition of such property, for the sole purpose of assessing the scenario
expected limit (“SEL”) for the Mortgaged Property in the event of an earthquake.
In such instance, the SEL was based on a 475-year return period, an exposure
period of 50 years and a 10% probability of exceedance. If the resulting report
concluded that the SEL would exceed 20% of the amount of the replacement costs
of the improvements, earthquake insurance on such Mortgaged Property was
obtained by an insurer rated at least “A:VIII” by A.M. Best Company or “A3” (or
the equivalent) from Moody’s Investors Service, Inc. or “A-” by Standard &
Poor’s Ratings Service in an amount not less than 100% of the SEL.

 

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The related Purchased Loan Documents require insurance proceeds in respect of a
property loss to be applied either (a) to the repair or restoration of all or
part of the related Mortgaged Property, with respect to all property losses in
excess of 5% of the then outstanding principal amount of the related Purchased
Loan, the Mortgagee (or a trustee appointed by it) having the right to hold and
disburse such proceeds as the repair or restoration progresses, or (b) to the
payment of the outstanding principal balance of such Purchased Loan together
with any accrued interest thereon.

All premiums on all insurance policies referred to in this section due and
payable as of the Purchase Date have been paid, and such insurance policies name
the Mortgagee under the Purchased Loan and its successors and assigns as a loss
payee under a mortgagee endorsement clause or, in the case of the general
liability insurance policy, as named or additional insured. Such insurance
policies will inure to the benefit of Buyer. Each related Purchased Loan
obligates the related Mortgagor to maintain or cause to be maintained all such
insurance and, at such Mortgagor’s failure to do so, authorizes the Mortgagee to
maintain such insurance at the Mortgagor’s reasonable cost and expense and to
charge such Mortgagor for related premiums. All such insurance policies (other
than commercial liability policies) require prior notice as provided in the
Purchased Loan Documents to the lender of termination or cancellation (or such
lesser period, as may be required by applicable law) arising for any reason
other than non-payment of a premium and no such notice has been received by
Seller.

 

(17)

Access; Utilities; Separate Tax Lots. To Seller’s Actual Knowledge, based solely
upon Seller’s review of the related Title Policy (if applicable) and current
surveys obtained in connection with origination, each Mortgaged Property (a) is
located on or adjacent to a public road and has direct legal access to such
road, or has access via an irrevocable easement or irrevocable right of way
permitting ingress and egress to/from a public road, (b) is served by or has
uninhibited access rights to public or private water and sewer (or well and
septic) and all required utilities, all of which are appropriate for the current
use of the Mortgaged Property, and (c) constitutes one or more separate tax
parcels (if applicable) which do not include any property which is not part of
the Mortgaged Property or, if applicable, is subject to an endorsement under the
related Title Policy insuring the Mortgaged Property or, with respect to any
Foreign Purchased Loan, except as disclosed by or on behalf of the applicable
Seller to Buyer in writing prior to the Purchase Date as part of the Due
Diligence Package, or in certain cases, an application has been, or will be,
made to the applicable governing authority for creation of separate tax lots, in
which case the Purchased Loan requires the Mortgagor to escrow an amount
sufficient to pay taxes for the existing tax parcel of which the Mortgaged
Property is a part until the separate tax lots are created.

 

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(18)

No Encroachments. To Seller’s Actual Knowledge based solely on current surveys
and, with respect to a U.S. Purchased Loan, the Mortgagee’s Title Policy (or, if
such policy is not yet issued, a pro forma title policy, a preliminary title
policy with escrow instructions or a “marked up” commitment) obtained in
connection with the origination of each Purchased Loan, or, with respect to any
Foreign Purchased Loan, except as disclosed by or on behalf of the applicable
Seller to Buyer in writing prior to the Purchase Date, (a) all material
improvements that were included for the purpose of determining the appraised
value of the related Mortgaged Property at the time of the origination of such
Purchased Loan are within the boundaries of the related Mortgaged Property,
except encroachments that do not materially and adversely affect the value or
current use of such Mortgaged Property or, with respect to a U.S. Purchased
Loan, for which encroachments insurance or endorsements were obtained under the
Title Policy, (b) no improvements on adjoining parcels encroach onto the related
Mortgaged Property except for encroachments that do not materially and adversely
affect the value or current use of such Mortgaged Property or, with respect to a
U.S. Purchased Loan, for which encroachments insurance or endorsements were
obtained under the Title Policy, and (c) no improvements encroach upon any
easements except for encroachments the removal of which would not materially and
adversely affect the value or current use of such Mortgaged Property or, with
respect to a U.S. Purchased Loan, for which encroachments insurance or
endorsements obtained with respect to the Title Policy.

 

(19)

No Contingent Interest or Equity Participation. No Purchased Loan has a shared
appreciation feature, any other contingent interest feature or a negative
amortization feature (except that an ARD Loan may provide for the accrual of the
portion of interest in excess of the rate in effect prior to the anticipated
repayment date) or an equity participation by Seller (excluding any equity
interest held or pledged in connection with a Mezzanine Loan or preferred equity
interest).

 

(20)

REMIC. In respect of a U.S. Purchased Loan, to the extent such Purchased Loan is
identified as being REMIC eligible, the Purchased Loan is a “qualified mortgage”
within the meaning of Section 860G(a)(3) of the Code (but determined without
regard to the rule in the Treasury Regulations Section 1.860G-2(f)(2) that
treats certain defective mortgage loans as qualified mortgages), and,
accordingly, (A) the issue price of the Purchased Loan to the related Mortgagor
at origination did not exceed the non-contingent principal amount of the
Purchased Loan and (B) either: (a) such Purchased Loan is secured by an interest
in real property (including buildings and structural components thereof, but
excluding personal property) having a fair market value (i) at the date the
Purchased Loan was originated at least equal to 80% of the adjusted issue price
of the Purchased Loan on such date or (ii) at the Purchase Date at least equal
to 80% of the adjusted issue price of the Purchased Loan on such date, provided
that for purposes hereof, the fair market value of the real property interest
must first be reduced by (A) the amount of any lien on the real property
interest that is senior to the Purchased Loan and (B) a proportionate amount of
any lien that is in parity with the Purchased Loan; or (b) substantially all of
the proceeds of such Purchased Loan were used to acquire, improve or protect the
real

 

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property which served as the only security for such Purchased Loan (other than a
recourse feature or other third-party credit enhancement within the meaning of
Treasury Regulations Section 1.860G-2(a)(1)(ii)). If such U.S. Purchased Loan
was “significantly modified” prior to the Purchase Date so as to result in a
taxable exchange under Section 1001 of the Code, it either (x) was modified as a
result of the default or reasonably foreseeable default of such Purchased Loan
or (y) satisfies the provisions of either sub-clause (B)(a)(i) above
(substituting the date of the last such modification for the date the Purchased
Loan was originated) or sub- clause (B)(a)(ii), including the proviso thereto.
Any prepayment premium and yield maintenance charges applicable to such U.S.
Purchased Loan constitute “customary prepayment penalties” within the meaning of
Treasury Regulations Section 1.860G-1(b)(2). All terms used in this paragraph
shall have the same meanings as set forth in the related Treasury Regulations.

 

(21)

Compliance with Usury Laws. To Seller’s Actual Knowledge, in reliance solely
upon legal opinions delivered in connection with a Purchased Loan, the interest
rate (exclusive of any default interest, late charges, yield maintenance charge,
or prepayment premiums) of such Purchased Loan complied as of the date of
origination with, or was exempt from, applicable laws including state or federal
laws, regulations and other requirements pertaining to usury.

 

(22)

Authorized to do Business. To the extent required under applicable law, as of
the Purchase Date or as of the date that such entity held the Mortgage Note,
each holder of the Mortgage Note was authorized to transact and do business in
the jurisdiction in which each related Mortgaged Property is located, or the
failure to be so authorized does not materially and adversely affect the
enforceability of such Purchased Loan by Buyer.

 

(23)

Trustee under Deed of Trust. With respect to each Mortgage which is a deed of
trust, as of the date of origination and, to Seller’s Actual Knowledge, as of
the Purchase Date, a trustee, duly qualified under applicable law to serve as
such, currently so serves and is named in the deed of trust or has been
substituted in accordance with the Mortgage and applicable law or may be
substituted in accordance with the Mortgage and applicable law by the related
Mortgagee.

To the extent applicable, if any Mortgage is held in trust for the lender and/or
related parties:

(a) a trustee, duly qualified under applicable law to serve as such, is properly
designated and serving as such; and

(b) no fees or expenses other than customary fees, costs and indemnities
(including annual agency/security agency fees, transfer fees and fees for
management time) are payable to such trustee by Seller if the related Mortgagor
does not fulfill its obligations to pay such amounts under the Purchased Loan.

 

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(24)

Local Law Compliance. To Seller’s Actual Knowledge, based solely upon any of a
letter from any governmental authorities, a legal opinion, an architect’s
letter, a zoning consultant’s report, an endorsement to the related Title Policy
(if applicable), or other affirmative investigation of local law compliance
consistent with the investigation conducted by Seller for similar commercial and
multifamily mortgage loans intended for securitization, the improvements located
on or forming part of each Mortgaged Property securing a Purchased Loan as of
the date of origination of such Purchased Loan (or related Whole Loan, as
applicable) and as of the Purchase Date, there are no material violations of
applicable zoning ordinances, building codes and land laws (collectively “Zoning
Regulations”) other than those which (i) are insured by the Title Policy or a
law and ordinance insurance policy, or, with respect to a Foreign Purchased
Loan, matters that have been described in the related Property Report, (ii) are
adequately reserved for in accordance with the Purchased Loan Documents, or
(iii) would not have a material adverse effect on the value, operation or net
operating income of the Mortgaged Property. The terms of the Purchased Loan
Documents require the Mortgagor to comply in all material respects with all
applicable governmental regulations, zoning and building laws.

 

(25)

Licenses and Permits. Each Mortgagor covenants in the Purchased Loan Documents
that it shall keep all material licenses, permits and applicable governmental
authorizations necessary for its operation of the Mortgaged Property in full
force and effect, and to Seller’s Actual Knowledge based upon any of a letter
from any government authorities or other affirmative investigation of local law
compliance consistent with the investigation conducted by Seller for similar
commercial and multifamily mortgage loans intended for securitization, all such
material licenses, permits and applicable governmental authorizations are in
effect. The Purchased Loan requires the related Mortgagor to be qualified to do
business in the jurisdiction in which the related Mortgaged Property is located.

 

(26)

Recourse Obligations. The Purchased Loan Documents for each U.S. Purchased Loan
provide that such Purchased Loan (a) becomes full recourse to the Mortgagor or
guarantor (which is a natural person or persons, or an entity distinct from the
Mortgagor (but may be affiliated with the Mortgagor) that has assets other than
equity in the related Mortgaged Property that are not de minimis) in any of the
following events: (i) if any voluntary petition for bankruptcy, insolvency,
dissolution or liquidation pursuant to federal bankruptcy law, or any similar
federal or state law, shall be filed by the Mortgagor; (ii) Mortgagor or
guarantor shall have colluded with (or, alternatively, solicited or caused to be
solicited) other creditors to cause an involuntary bankruptcy filing with
respect to the Mortgagor or (iii) voluntary transfers of either the Mortgaged
Property or equity interests in Mortgagor made in violation of the Purchased
Loan Documents; and (b) contains provisions providing for recourse against the
Mortgagor or guarantor (which is a natural person or persons, or an entity
distinct from the Mortgagor (but may be affiliated with the Mortgagor) that has
assets other than equity in the related Mortgaged Property that are not de
minimis), for losses and damages sustained by reason

 

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of Mortgagor’s (i) misappropriation of rents after the occurrence of an event of
default under the Purchased Loan, (ii) misappropriation of (A) insurance
proceeds or condemnation awards or (B) security deposits or, alternatively, the
failure of any security deposits to be delivered to Mortgagee upon foreclosure
or action in lieu thereof (except to the extent applied in accordance with
leases prior to a Purchased Loan event of default); (iii) fraud or intentional
material misrepresentation; (iv) breaches of the environmental covenants in the
Purchased Loan Documents; or (v) commission of intentional material physical
waste at the Mortgaged Property.

 

(27)

Mortgage Releases. The terms of the related Mortgage or related Purchased Loan
Documents do not provide for release of any material portion of the Mortgaged
Property from the lien of the Mortgage except (a) a partial release, accompanied
by principal repayment, or (in the case of a U.S. Purchased Loan) partial
Defeasance (as defined in paragraph (32)), of not less than a specified
percentage, which, in the case of a U.S. Purchased Loan identified as REMIC
eligible, at least equal to the lesser of (i) 110% of the related allocated loan
amount of such portion of the Mortgaged Property and (ii) the outstanding
principal balance of the Purchased Loan, (b) upon payment in full of such
Purchased Loan, (c) upon a Defeasance defined in paragraph (32) below, (d)
releases of out-parcels that are unimproved or other portions of the Mortgaged
Property which will not have a material adverse effect on the underwritten value
of the Mortgaged Property and which were not afforded any material value in the
appraisal obtained at the origination of the Purchased Loan and are not
necessary for physical access to the Mortgaged Property or compliance with
zoning requirements, or (e) as required pursuant to an order of condemnation or
taking by a state or other jurisdiction or any political subdivision or
authority thereof. With respect to any U.S. Purchased Loan identified as REMIC
eligible, with respect to any partial release under the preceding clauses (a) or
(d), either: (x) such release of collateral (i) would not constitute a
“significant modification” of such Purchased Loan within the meaning of
Section 1.860G-2(b)(2) of the Treasury Regulations and (ii) would not cause such
Purchased Loan to fail to be a “qualified mortgage” within the meaning of
Section 860G(a)(3)(A) of the Code; or (y) the Mortgagee or Servicer can, in
accordance with the related Purchased Loan Documents, condition such release of
collateral on the related Mortgagor’s delivery of an opinion of tax counsel to
the effect specified in the immediately preceding clause (x). For purposes of
the preceding clause (x), if the fair market value of the real property
constituting such Mortgaged Property after the release is not equal to at least
80% of the principal balance of such Purchased Loan outstanding after the
release, the Mortgagor is required to make a payment of principal in an amount
not less than the amount required by the REMIC provisions.

 

(28)

Financial Reporting and Rent Rolls. Each Mortgage requires the Mortgagor to
provide the owner or holder of the Mortgage with quarterly (other than for
single-tenant properties) and annual operating statements, and quarterly (other
than for single-tenant properties) rent rolls for properties that have leases
contributing more than 5% of the in-place base rent and annual financial
statements, which annual financial statements with

 

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respect to each Purchased Loan with more than one Mortgagor are in the form of
an annual combined balance sheet of the Mortgagor entities (and no other
entities), together with the related combined statements of operations, members’
capital and cash flows, including a combining balance sheet and statement of
income for the Mortgaged Properties on a combined basis.

 

(29)

Acts of Terrorism Exclusion. With respect to each Purchased Loan over
$20 million (or, with respect to any Foreign Purchased Loan, its then-current
equivalent based on the Spot Rate with respect to the Applicable Currency of
such Foreign Purchased Loan as of the date of determination), the related
special-form all-risk insurance policy and business interruption policy (issued
by an insurer meeting the Insurance Rating Requirements) do not specifically
exclude Acts of Terrorism, as defined in the Terrorism Risk Insurance Act of
2002, as amended by the Terrorism Risk Insurance Program Reauthorization Act of
2007 (collectively referred to as “TRIA”) (or, with respect to a Foreign
Purchased Loan, the equivalent term under the equivalent Requirements of Law
under the relevant non-U.S. jurisdiction), from coverage, or if such coverage is
excluded, it is covered by a separate terrorism insurance policy. With respect
to each other Purchased Loan, the related special all-risk insurance policy and
business interruption policy (issued by an insurer meeting the Insurance Rating
Requirements) did not, as of the date of origination of the Purchased Loan, and,
to Seller’s Actual Knowledge, do not, as of the Purchase Date, specifically
exclude Acts of Terrorism, as defined in TRIA (or, with respect to a Foreign
Purchased Loan, the equivalent term under the equivalent Requirements of Law
under the relevant non-U.S. jurisdiction), from coverage, or if such coverage is
excluded, it is covered by a separate terrorism insurance policy. With respect
to each Purchased Loan, the related Purchased Loan Documents do not expressly
waive or prohibit the Mortgagee from requiring coverage for Acts of Terrorism,
as defined in TRIA (or, with respect to a Foreign Purchased Loan, the equivalent
term under the equivalent Requirements of Law under the relevant non-U.S.
jurisdiction), or damages related thereto except to the extent that any right to
require such coverage may be limited by commercial availability on commercially
reasonable terms, or as otherwise indicated in the related report delivered by
Seller to Buyer of any exceptions to the representations and warranties set
forth in this Exhibit VI; provided, that if TRIA (or, with respect to a Foreign
Purchased Loan, the equivalent Requirements of Law under the relevant non-U.S.
jurisdiction) or a similar or subsequent statute is not in effect, then,
provided that terrorism insurance is commercially available, the Mortgagor under
each Purchased Loan is required to carry terrorism insurance, but in such event
the Mortgagor shall not be required to spend more than the Terrorism Cap Amount
on terrorism insurance coverage, and if the cost of terrorism insurance exceeds
the Terrorism Cap Amount, the Mortgagor is required to purchase the maximum
amount of terrorism insurance available with funds equal to the Terrorism Cap
Amount. The “Terrorism Cap Amount” is the specified percentage (which is at
least equal to 200%) of the amount of the insurance premium that is payable at
such time in respect of the property and business interruption/rental loss
insurance required under the related Purchased Loan Documents (without giving
effect to the cost of terrorism and earthquake components of such casualty and
business interruption/rental loss insurance).

 

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(30)

Due on Sale or Encumbrance. Except as otherwise disclosed in the Due Diligence
Package, subject to specific exceptions set forth below, each U.S. Purchased
Loan contains a “due on sale” or other such provision for the acceleration of
the payment of the unpaid principal balance of such Purchased Loan if, without
the consent of the holder of the Mortgage (which consent, in some cases, may not
be unreasonably withheld) and/or complying with the requirements of the related
Purchased Loan Documents (which provide for transfers without the consent of the
Mortgagee which are customarily acceptable to Seller lending on the security of
property comparable to the related Mortgaged Property, including, without
limitation, transfers of worn-out or obsolete furnishings, fixtures, or
equipment promptly replaced with property of equivalent value and functionality
and transfers by leases entered into in accordance with the Purchased Loan
Documents), (a) the related Mortgaged Property, or any equity interest of
greater than 50% in the related Mortgagor, is directly or indirectly pledged,
transferred or sold, other than as related to (i) family and estate planning
transfers or transfers upon death or legal incapacity, (ii) transfers to certain
affiliates as defined in the related Purchased Loan Documents, (iii) transfers
of less than, or other than, a controlling interest in the related Mortgagor,
(iv) transfers to another holder of direct or indirect equity in the Mortgagor,
a specific Person designated in the related Purchased Loan Documents or a Person
satisfying specific criteria identified in the related Purchased Loan Documents,
such as a qualified equityholder, (v) transfers of stock or similar equity units
in publicly traded companies or (vi) a substitution or release of collateral
within the parameters of paragraphs (27) and (32) herein, or (vii) by reason of
any mezzanine debt that existed at the origination of the related Purchased
Loan, or future permitted mezzanine debt as set forth in the Due Diligence
Package or (b) the related Mortgaged Property is encumbered with a subordinate
lien or security interest against the related Mortgaged Property, other than
(i) any Junior Interest of any Purchased Loan or any subordinate debt that
existed at origination and is permitted under the related Purchased Loan
Documents, (ii) purchase money security interests (iii) any Purchased Loan that
is cross-collateralized and cross-defaulted with another Purchased Loan, as set
forth in the Due Diligence Package or (iv) Permitted Encumbrances. The related
Mortgage or other Purchased Loan Documents provide that to the extent any rating
agency fees are incurred in connection with the review of and consent to any
transfer or encumbrance, the Mortgagor is responsible for such payment along
with all other reasonable out-of-pocket fees and expenses incurred by the
Mortgagee relative to such transfer or encumbrance. Upon the acceleration of a
Foreign Purchased Loan, all related security shall become immediately
enforceable.

 

(31)

Single-Purpose Entity. Except as otherwise disclosed in the Due Diligence
Package, each Purchased Loan requires the Mortgagor to be a Single-Purpose
Entity for at least as long as the Purchased Loan is outstanding. Both the
Purchased Loan Documents and the organizational documents of the Mortgagor with
respect to each Purchased Loan with an unpaid principal balance as of the
Purchase Date in excess of $5 million (or, with respect

 

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to any Foreign Purchased Loan, its then-current equivalent based on the Spot
Rate with respect to the Applicable Currency of such Foreign Purchased Loan as
of the date of determination) provide that the Mortgagor is a Single-Purpose
Entity, and each Purchased Loan with an unpaid principal balance as of the
Purchase Date of $50 million (or, with respect to any Foreign Purchased Loan,
its then-current equivalent based on the Spot Rate with respect to the
Applicable Currency of such Foreign Purchased Loan as of the date of
determination) or more has a counsel’s opinion regarding non-consolidation of
the Mortgagor. For this purpose, a “Single-Purpose Entity” shall mean an entity,
other than an individual, whose organizational documents (or if the Purchased
Loan has an unpaid principal balance as of the Purchase Date equal to $5 million
(or, with respect to any Foreign Purchased Loan, its then-current equivalent
based on the Spot Rate with respect to the Applicable Currency of such Foreign
Purchased Loan as of the date of determination) or less, its organizational
documents or the related Purchased Loan Documents) provide substantially to the
effect that it was formed or organized solely for the purpose of owning and
operating one or more of the Mortgaged Properties securing the Purchased Loans
and prohibit it from engaging in any business unrelated to such Mortgaged
Property or (in the case of U.S. Purchased Loans only) commercial or
multi-family properties, and whose organizational documents further provide, or
which entity represented in the related Purchased Loan Documents, substantially
to the effect that it does not have any assets other than those related to its
interest in and operation of such Mortgaged Property or (in the case of U.S.
Purchased Loans only) commercial or multi-family properties, or any indebtedness
other than as permitted by the related Mortgage(s) or the other related
Purchased Loan Documents, that it has its own books and records and accounts
separate and apart from those of any other person (other than a Mortgagor for a
Purchased Loan that is cross-collateralized and cross-defaulted with the related
Purchased Loan), and that it holds itself out as a legal entity, separate and
apart from any other person or entity.

 

(32)

Defeasance. With respect to any U.S. Purchased Loan that, pursuant to the
related Purchased Loan Documents, can be defeased (a “Defeasance”), (i) the
Purchased Loan Documents provide for defeasance as a unilateral right of the
Mortgagor, subject to satisfaction of conditions specified in the Purchased Loan
Documents; (ii) the Purchased Loan cannot be defeased within two years after the
date of origination of such Purchased Loan; (iii) the Mortgagor is permitted to
pledge only United States “government securities” within the meaning of Treasury
Regulations Section 1.860G-2(a)(8)(ii), the revenues from which will, in the
case of a full Defeasance, be sufficient to make all scheduled payments under
the Purchased Loan when due, including the entire remaining principal balance on
the maturity date (or on or after the first date on which payment may be made
without payment of a yield maintenance charge or prepayment penalty) or, if the
Senior Loan is an ARD Loan, the entire principal balance outstanding on the
anticipated repayment date, and if the Purchased Loan permits partial releases
of real property in connection with partial defeasance, the revenues from the
collateral will be sufficient to pay all such scheduled payments calculated on a
principal amount equal to a specified percentage at least equal to the lesser of
(a) 110% of the allocated loan amount for the

 

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real property to be released and (b) the outstanding principal balance of the
Purchased Loan; (iv) the Mortgagor is required to provide a certification from
an independent certified public accountant that the collateral is sufficient to
make all scheduled payments under the Mortgage Note as set forth in (iii) above,
(v) if the Mortgagor would continue to own assets in addition to the defeasance
collateral, the portion of the Purchased Loan secured by defeasance collateral
is required to be assumed (or the Mortgagee may require such assumption) by a
Single-Purpose Entity; (vi) the Mortgagor is required to provide an opinion of
counsel that the Mortgagee has a perfected security interest in such collateral
prior to any other claim or interest; and (vii) the Mortgagor is required to pay
all rating agency fees associated with Defeasance (if rating confirmation is a
specific condition precedent thereto) and all other reasonable out-of-pocket
expenses associated with Defeasance, including, but not limited to, accountant’s
fees and opinions of counsel.

 

(33)

Ground Leases. For purposes of this Exhibit VI, a “Ground Lease” shall mean a
lease creating a leasehold estate in real property where the fee owner as the
ground lessor conveys for a term or terms of years its entire interest in the
land and buildings and other improvements, if any, comprising the premises
demised under such lease to the ground lessee (who may, in certain
circumstances, own the building and improvements on the land), subject to the
reversionary interest of the ground lessor as fee owner and does not include
industrial development agency (IDA) or similar leases for purposes of conferring
a tax abatement or other benefit.

With respect to any Purchased Loan where the Purchased Loan is secured by a
leasehold estate under a Ground Lease in whole or in part, and the related
Mortgage does not also encumber the related lessor’s fee interest in such
Mortgaged Property, based upon the terms of the Ground Lease and any estoppel or
other agreement received from the ground lessor in favor of Seller, its
successors and assigns, Seller represents and warrants that:

 

  (a)

The Ground Lease or a memorandum regarding such Ground Lease has been duly
recorded or registered or submitted for recordation or registration in a form
that is acceptable for recording or registration in the applicable jurisdiction.
The Ground Lease or an estoppel or other agreement received from the ground
lessor permits the interest of the lessee to be encumbered by the related
Mortgage and does not restrict the use of the related Mortgaged Property by such
lessee, its successors or assigns in a manner that would materially adversely
affect the security provided by the related Mortgage;

 

  (b)

The lessor under such Ground Lease has agreed in a writing included in the
related Purchased Loan File (or in such Ground Lease) that the Ground Lease may
not be amended or modified, or canceled or terminated by agreement of lessor and
lessee, without the prior written consent of the Mortgagee;

 

VI-I-17

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  (c)

The Ground Lease has an original term (or an original term plus one or more
optional renewal terms, which, under all circumstances, may be exercised, and
will be enforceable, by either Mortgagor or the Mortgagee) that extends not less
than 20 years beyond the stated maturity of the related Purchased Loan, or 10
years past the stated maturity if such Purchased Loan fully amortizes by the
stated maturity (or with respect to a Purchased Loan that accrues on an actual
360 basis, substantially amortizes);

 

  (d)

The Ground Lease either (i) is not subject to any liens or encumbrances superior
to, or of equal priority with, the Mortgage, except for the related fee interest
of the ground lessor and the Permitted Encumbrances, or (ii) is subject to a
subordination, non-disturbance and attornment agreement to which the Mortgagee
on the lessor’s fee interest in the Mortgaged Property is subject;

 

  (e)

The Ground Lease does not place, in Seller’s reasonable judgment and to Seller’s
Actual Knowledge, commercially unreasonably restrictions on the identity of the
Mortgagee and, upon foreclosing on the Mortgage, the Ground Lease is assignable
to the holder of the Purchased Loan and its successors and assigns without the
consent of the lessor thereunder (provided that proper notice is delivered to
the extent required in accordance with such Ground Lease), and in the event it
is so assigned, it is further assignable by the holder of the Purchased Loan and
its successors and assigns without the consent of the lessor;

 

  (f)

Seller has not received any written notice of material default (or in the case
of a Foreign Purchased Loan, forfeiture) under or notice of termination of such
Ground Lease. To Seller’s Actual Knowledge, there is no material default under
such Ground Lease and no condition that, but for the passage of time or giving
of notice, would result in a material default under the terms of such Ground
Lease, and in the case of a Foreign Purchased Loan, would lead to a forfeiture
of such Ground Lease, and to Seller’s Actual Knowledge, such Ground Lease is in
full force and effect as of the Purchase Date;

 

  (g)

The Ground Lease or ancillary agreement between the lessor and the lessee
requires the lessor to give to the Mortgagee written notice of any default, and
provides that no notice of default or termination is effective against the
Mortgagee unless such notice is given to the Mortgagee;

 

  (h)

The Mortgagee is permitted a reasonable opportunity (including, where necessary,
sufficient time to gain possession of the interest of the lessee under the
Ground Lease through legal proceedings) to cure any default under the Ground
Lease which is curable after the Mortgagee’s receipt of notice of any default
before the lessor may terminate the Ground Lease;

 

  (i)

The Ground Lease does not impose any restrictions on subletting that would be
viewed, in Seller’s reasonable judgment, as commercially unreasonable by a
Seller in connection with loans originated for securitization;

 

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  (j)

Under the terms of the Ground Lease, an estoppel or other agreement received
from the ground lessor and the related Mortgage (taken together), any related
insurance proceeds or the portion of the condemnation award allocable to the
ground lessee’s interest (other than (i) de minimis amounts for minor casualties
or (ii) in respect of a total or substantially total loss or taking as addressed
in subpart (k)) will be applied either to the repair or to restoration of all or
part of the related Mortgaged Property with (so long as such proceeds are in
excess of the threshold amount specified in the related Purchased Loan
Documents) the Mortgagee or a trustee appointed by it having the right to hold
and disburse such proceeds as repair or restoration progresses, or to the
payment of the outstanding principal balance of the Purchased Loan, together
with any accrued interest;

 

  (k)

In the case of a total or substantially total taking or loss, under the terms of
the Ground Lease, an estoppel or other agreement and the related Mortgage (taken
together), any related insurance proceeds, or portion of the condemnation award
allocable to ground lessee’s interest in respect of a total or substantially
total loss or taking of the related Mortgaged Property to the extent not applied
to restoration, will be applied first to the payment of the outstanding
principal balance of the Purchased Loan, together with any accrued interest; and

 

  (l)

Provided that the Mortgagee cures any defaults which are susceptible to being
cured, the ground lessor has agreed to enter into a new lease with Mortgagee
upon termination of the Ground Lease for any reason, including rejection of the
Ground Lease in an Act of Insolvency.

 

(35)

Servicing. The servicing and collection practices used by Seller with respect to
the Purchased Loan have been, in all respects, legal and have met customary
industry standards for servicing of commercial loans.

 

(36)

Origination and Underwriting. The origination practices of Seller (or to
Seller’s Actual Knowledge the related originator if Seller was not the
originator) with respect to each Purchased Loan have been, in all material
respects, in material compliance with applicable law and as of the date of its
origination, such Purchased Loan (or the related Whole Loan, as applicable) and
to the extent originated by Seller or its Affiliates or, if originated by
another Person, to Seller’s Actual Knowledge, the origination thereof complied
in all material respects with, or was exempt from, all requirements of federal,
state or local law relating to the origination of such Purchased Loan; provided
that such representation and warranty does not address or otherwise cover any
matters with respect to federal, state or local law otherwise covered in this
Exhibit VI.

 

VI-I-19

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(37)

No Material Default; Payment Record. As of the Purchase Date and the date of the
transfer of any Margin Excess to Seller, no Purchased Loan has been more than 30
days delinquent, without giving effect to any grace or cure period, in making
required debt service payments since origination, and no Purchased Loan is more
than 30 days delinquent (beyond any applicable grace or cure period) in making
required payments. As of the Purchase Date and the date of the transfer of any
Margin Excess to Seller, to Seller’s Actual Knowledge, there is (a) no material
default, breach, violation or event of acceleration existing under the related
Purchased Loan, or (b) no event (other than payments due but not yet delinquent)
which, with the passage of time or with notice and the expiration of any grace
or cure period, would constitute a material default, breach, violation or event
of acceleration, which default, breach, violation or event of acceleration, in
the case of either (a) or (b), materially and adversely affects the value of the
Purchased Loan or the value, use or operation of the related Mortgaged Property,
provided, however, that this representation and warranty does not cover any
default, breach, violation or event of acceleration that specifically pertains
to or arises out of an exception scheduled to any other representation and
warranty made by Seller in this Exhibit VI (including, but not limited to, the
prior sentence). Solely with respect to a Whole Loan, no person other than the
holder of such Purchased Loan may declare any event of default under the
Purchased Loan or accelerate any indebtedness under the Purchased Loan
Documents.

 

(38)

Bankruptcy. To Seller’s Actual Knowledge as of the Purchase Date and the date of
the transfer of any Margin Excess to Seller, neither the Mortgaged Property
(other than any tenants of such Mortgaged Property), nor any portion thereof, is
the subject of, and no Mortgagor, guarantor or tenant occupying a single-tenant
property is a debtor in a state or federal Act of Insolvency, and in the case of
any Foreign Purchased Loan, is not a debtor in any bankruptcy, receivership,
conservatorship, reorganization, insolvency, moratorium, administration,
examinership or similar proceeding.

 

(39)

Organization of Mortgagor. With respect to each U.S. Purchased Loan, based
solely upon Seller’s reliance on certified copies of the organizational
documents of the Mortgagor delivered by the Mortgagor in connection with the
origination of such Purchased Loan (or related Whole Loan, as applicable), the
Mortgagor is an entity organized under the laws of a state of the United States
of America, the District of Columbia or the Commonwealth of Puerto Rico. With
respect to each Foreign Purchased Loan, based solely upon Seller’s reliance on
certified copies of the organizational documents of the Mortgagor delivered by
the Mortgagor in connection with the origination of such Purchased Loan (or
related Whole Loan, as applicable), the related Mortgagor is an entity organized
under the laws of England and Wales, Jersey, Guernsey, Luxembourg, Germany or
another jurisdiction in which single purpose entities formed for the purposes of
investment in mortgaged properties located in England and Wales or other
European countries are commonly organized. Except with respect to any Purchased
Loan that is cross-collateralized and cross defaulted with another Purchased
Loan, to Seller’s Actual Knowledge, no Purchased Loan has a Mortgagor that is an
affiliate of another Mortgagor. An “Affiliate” for purposes of this Paragraph 39
means, a mortgagor that is under direct or indirect common ownership and control
with another mortgagor.

 

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(40)

Environmental Conditions. There is no material and adverse environmental
condition or circumstance affecting the related Mortgaged Property; there is no
material violation of any applicable Environmental Law with respect to the
related Mortgaged Property. Neither Seller nor the underlying obligor on such
Senior Loan has taken any actions which would cause the related Mortgaged
Property not to be in material compliance with all applicable Environmental
Laws. The related Purchased Loan Documents require the borrower to materially
comply with all Environmental Laws. Each mortgagor has agreed to either
indemnify the mortgagee for any losses resulting from any material, adverse
environmental condition (to the extent such condition is not caused by Seller,
or from any failure of the mortgagor to abide by such Environmental Laws) or has
provided environmental insurance.

 

(41)

Appraisal. The Purchased Loan File contains an appraisal of the related
Mortgaged Property with an appraisal date within 6 months of the Purchased Loan
origination date, and within 12 months of the Purchase Date. The appraisal is
signed by an appraiser who (i) is a Member of the Appraisal Institute (“MAI”)
(or (A) in the case of a Mortgaged Property located in England and Wales, a
Charter Surveyor, and (B) in the case of a Mortgaged Property located elsewhere
in the European Union, a functional equivalent) and (ii), to Seller’s Actual
Knowledge, had no interest, direct or indirect, in the Mortgaged Property or the
Mortgagor or in any loan made on the security thereof, and whose compensation is
not affected by the approval or disapproval of the Purchased Loan. Each
appraiser has represented in such appraisal or in a supplemental letter that the
appraisal satisfies the requirements of: (i) in the case of a Mortgaged Property
located in the United States, the “Uniform Standards of Professional Appraisal
Practice” as adopted by the Appraisal Standards Board of the Appraisal
Foundation, (ii) in the case of a Mortgaged Property located in England and
Wales, the Valuations Standards (Red Book) published by the Royal Institute of
Chartered Surveyors, and (iii) in the case of a Mortgaged Property located
elsewhere in the European Union, the appraisal standards uniformly or
customarily followed or adopted by the commercial real estate industry within
the relevant jurisdiction.

 

(42)

Due Diligence Package. To Seller’s Actual Knowledge, the information pertaining
to each Purchased Loan which is set forth in the Due Diligence Package is true
and correct in all material respects as of the Purchase Date.

 

(43)

[Intentionally Omitted]

 

(44)

Advance of Funds by Seller. After origination, no advance of funds has been made
by Seller to the related Mortgagor other than in accordance with the Purchased
Loan Documents, and, to Seller’s Actual Knowledge, no funds have been received
from any person other than the related Mortgagor or an affiliate for, or on
account of, payments due on the Purchased Loan (other than as contemplated by
the Purchased Loan Documents, such as, by way of example and not in limitation
of the foregoing, amounts paid by the tenant(s) into a Mortgagee-controlled
lockbox if required or contemplated under the related lease or Purchased Loan
Documents). Neither Seller nor any affiliate thereof has any obligation to make
any capital contribution to any Mortgagor under a Purchased Loan, other than
contributions made on or prior to the date hereof.

 

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(45)

Compliance with Anti-Money Laundering Laws. Seller has complied in all material
respects with all applicable anti-money laundering laws and regulations,
including without limitation the USA PATRIOT Act of 2001 with respect to the
origination of the Purchased Loan, the failure to comply with which would have a
material adverse effect on the Purchased Loan.

The following representations and warranties shall be made (when and as required
by the terms of the Agreement) with respect to Foreign Purchased Loans only:

 

(46)

Transferability (Foreign Purchased Loans): Other than consents and approvals
obtained or granted pursuant to the related Mortgage and/or Foreign Purchased
Loan Documents, no consent or approval by any Person is required in connection
with (a) Seller’s sale and/or Buyer’s acquisition of such Foreign Purchased
Loan, (b) Buyer’s exercise of any rights or remedies in respect of such Foreign
Purchased Loan (except with respect to compliance with any applicable
Requirement of Law in connection with the exercise of any rights or remedies by
Buyer) or (c) Buyer’s sale, pledge or other disposition of such Foreign
Purchased Loan. No third party holds any “right of first refusal”, “right of
first negotiation”, “right of first offer”, purchase option or other similar
rights of any kind, and no other impediment exists to any such transfer or
exercise of rights or remedies.

 

(47)

Condition of the Mortgaged Property (Foreign Purchased Loans): (a) Seller has
not received notice of any pending or, to Seller’s Actual Knowledge, threatened
steps to affect the compulsory purchase of all or any material portion of the
Mortgaged Property and (b) to Seller’s Actual Knowledge (based on valuations
obtained in connection with the origination of a Foreign Purchased Loan) as of
the date of the origination of such Foreign Purchased Loan, no such valuation
disclosed any matter or thing that would materially and adversely affect the
value or marketability of the Mortgaged Property.

 

(48)

Title (Foreign Purchased Loans): Seller obtained from its lawyer or other
approved party a report on title which showed no adverse entries, or, if such
report did reveal any adverse entries, such report satisfactorily indicated that
such entries would not have caused a reasonably prudent lender of money secured
on commercial property to decline to proceed with the related advance on its
agreed terms.

 

(49)

Provisions of Purchased Loan Documents (Foreign Purchased Loans): (a) to
Seller’s Actual Knowledge, the representations and warranties in the applicable
Purchased Loan Documents are true and correct in all material respects and
(b) the applicable Purchased Loan Documents require the Mortgagor to provide
Seller with (A) annual audited accounts of the Mortgagor in respect of the
Purchased Loans, (ii) semi-annual unaudited management accounts of the Mortgagor
in respect of the Purchased Loans, (iii) annual valuations for the Mortgaged
Property comprising real estate, (iv) quarterly rent rolls and quarterly
forecast of expenses for the Mortgaged Property.

 

VI-I-22

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(50)

Planning Law (Foreign Purchased Loans): To Seller’s Actual Knowledge, the
Mortgaged Property is, in all material respects, in compliance with, and is used
and occupied in accordance with, all restrictive covenants of record applicable
to such Mortgaged Property and applicable planning laws and all inspections,
licenses, permits and certificates of occupancy required by law, ordinance or
regulation to be made or issued with regard to the Mortgaged Property have been
obtained and are in full force and effect, except to the extent the failure to
obtain or maintain such inspections, licenses, permits or certificates of
occupancy does not materially impair or materially and adversely affect the use
and/or operation of the Mortgaged Property as it was used and operated as of the
date of origination of the Foreign Purchased Loan or the rights of a holder of
the Purchased Loan.

 

(51)

Advancement of Funds (Foreign Purchased Loans): Seller has not advanced funds or
induced, solicited or knowingly received any advance of funds from a party other
than the Mortgagor, directly or indirectly, for the payment of any amount
required by the Foreign Purchased Loan.

 

(52)

Cross-Collaterialization; Cross-Default (Foreign Purchased Loans): The Foreign
Purchased Loan is not cross-collateralized or cross-defaulted with any other
loan or security.

 

(53)

Acceleration (Foreign Purchased Loans): The applicable Purchased Loan Documents
contain provisions for the acceleration of the payment of the unpaid principal
balance of the Foreign Purchased Loan if (a) there is a disposal of the
Mortgaged Property or the Mortgagor, or (b) any security interests are created
over the Mortgaged Property or the Mortgagor in contravention of the Purchased
Loan Documents.

 

(54)

Approval Rights (Foreign Purchased Loans): Pursuant to the terms of the
applicable Foreign Purchased Loan Documents: (a) no material terms of the
Mortgage may be waived, cancelled, subordinated or modified in any material
respect and no material portion of the Mortgage or the Mortgaged Property may be
released without the consent of the holder of the Foreign Purchased Loan, except
to the extent such release is permitted under the terms of the applicable
Purchased Loan Documents; (b) no material action affecting the value of the
Mortgaged Property may be taken by the owner of the Mortgaged Property with
respect to the Mortgaged Property without the consent of the holder of the
applicable Purchased Loan Documents; and (c) the consent of the holder of the
applicable Purchased Loan Documents is required prior to the owner of the
Mortgaged Property incurring any additional indebtedness in each case, subject
to such exceptions as are customarily acceptable to prudent commercial and
multifamily mortgage lending institutions lending on the security of property
comparable to the Mortgaged Property in the jurisdiction in which the Mortgaged
Property is located.

 

VI-I-23

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(55)

Reserves (Foreign Purchased Loans): All reserves, funds, escrows and deposits
required pursuant to the Purchased Loan Documents for a Foreign Purchased Loan
have been so funded and deposited, are in the possession, or under the control,
of an agent of trustee for the holder of the Foreign Purchased Loan and, to
Seller’s Actual Knowledge, there are no deficiencies in connection therewith.

 

(56)

Valuation (Foreign Purchased Loans): A valuation of the Mortgaged Property
securing the Foreign Purchased Loan was conducted within twelve (12) months of
the origination of the Foreign Purchased Loan, and to Seller’s Actual Knowledge,
such valuation satisfied in all material respects the requirements for a
valuation on a market value basis as defined in the then current Royal
Institution of Chartered Surveyors Appraisal and Valuation Manual in association
with the Incorporated Society of Valuers and Auctioneers and the Institute of
Revenues Rating and Valuation, Practice Statement 4 (or its successor) (or its
equivalent in any applicable jurisdiction).

 

(57)

No Fraud (Foreign Purchased Loans): No fraudulent acts were committed by Seller
in connection with its acquisition or origination of the Foreign Purchased Loan
nor, to Seller’s Actual Knowledge, were any fraudulent acts committed by any
person in connection with the origination of the Foreign Purchased Loan.

 

(58)

No Equity Participation; No Contingent Interest (Foreign Purchased Loans): No
Foreign Purchased Loan (a) contains an equity participation by the lender or
shared appreciation feature or profit participation feature, (b) provides for
negative amortization, (c) provides for any contingent or additional interest in
the form of participation in the cash flow of the related Mortgaged Property or
(d) has capitalized interest included in its principal balance.

 

(59)

Transfer Certificate (Foreign Purchased Loan): Each Transfer Certificate
executed by Seller in blank (assuming the insertion of the date and an
assignee’s name) will constitute the legal, valid and binding first priority
assignment of the related Foreign Purchased Loan from Seller to such named
assignee (except as such enforcement may be limited by anti-deficiency laws or
bankruptcy, receivership, conversavtorship, reorganization, insolvency,
moratorium or other similar laws affecting the enforcement of creditors’ rights
generally, and by general principles of equity (regardless of whether such
enforcement is considered in a proceeding in equity or at law)).

For purposes of these representations and warranties, “Mortgagee” shall mean the
mortgagee, grantee or beneficiary under any Mortgage, any holder of legal title
to any portion of any Purchased Loan or, if applicable, any agent or servicer on
behalf of such party.

 

VI-I-24

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EXHIBIT VI-II

REPRESENTATIONS AND WARRANTIES REGARDING EACH INDIVIDUAL

PURCHASED LOAN WHICH IS A PARTICIPATION INTEREST IN A WHOLE LOAN

 

  (1)

Senior Interest; Ownership of Purchased Loans. The related participation
interest (the “Participation Interest”) is a senior participation interest in a
Whole Loan. In each case, the related Whole Loan (the “Underlying Whole Loan”)
is a mortgage loan secured by a first priority security interest in a commercial
or multifamily property. At the time of the sale, transfer and assignment to
Buyer, no Mortgage Note or Mortgage related to such Participation Interest was
subject to any other assignment, participation (other than senior pari passu
Participation Interests in the related Underlying Whole Loan issued in
accordance with the Purchased Loan Documents) or pledge, and Seller had good
title to, and was the sole owner of, such Participation Interest free and clear
of any and all liens, charges, pledges, encumbrances, participations, any other
ownership interests on, in or to such Participation Interest other than any
servicing rights appointment or similar agreement and rights of the holder of a
related “B note” in an “A/B” structure in a commercial real estate loan (a
“Junior Interest”). Seller has full right and authority to sell, assign and
transfer such Participation Interest, and the assignment to Buyer constitutes a
legal, valid and binding assignment of such Participation Interest free and
clear of any and all liens, pledges, charges or security interests of any nature
encumbering such Participation Interest other than the rights of the holder of a
related Junior Interest.

 

  (2)

Authorized to do Business. To the extent required under applicable law, as of
the Purchase Date or as of the date that such entity held the related
Participation Interest, each holder of such Participation Interest was
authorized to transact and do business in the jurisdiction in which each related
Mortgaged Property is located, or the failure to be so authorized does not
materially and adversely affect the enforceability of such Participation
Interest by Buyer.

 

  (3)

Due Diligence Package. To Seller’s Actual Knowledge, the information pertaining
to such Participation Interest which is set forth in the Due Diligence Package
is true and correct in all material respects as of the Purchase Date.

 

  (4)

Absence of Required Consents. Other than consents and approvals obtained as of
the related Purchase Date or those already granted in the related Purchased Loan
Documents, and assuming that Buyer and any other transferees comply with any
intercreditor restrictions set forth in the related Purchased Loan Documents
limiting assignees to “Qualified Transferees”, “Qualified Conduit Lenders” or
such comparable terms or conditions under the applicable Purchased Loan
Documents, no consent or approval by any Person is required in connection with
Seller’s sale and/or Buyer’s acquisition of such Participation Interest or for
Buyer’s exercise of

 

VI-II-1

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any rights or remedies in respect of such Participation Interest (except for
compliance with applicable Requirements of Law in connection with the exercise
of any rights or remedies by Buyer). No third party holds any “right of first
refusal”, “right of first negotiation”, “right of first offer”, purchase option,
or other similar rights of any kind, and no other impediment exists to any such
transfer or exercise of rights or remedies.

 

  (5)

Absence of Required Governmental Actions. No consent, approval, authorization or
order of, or registration or filing with, or notice to, any court or
governmental agency or body having jurisdiction or regulatory authority is
required for any transfer or assignment by the holder of such Participation
Interest.

 

  (6)

Delivery of Original Certificate. Seller has delivered to Buyer or its designee
the original participation certificate or other similar document(s) representing
ownership of such Participation Interest, however denominated, endorsed by
Seller in blank.

 

  (7)

No Material Default; Payment Record. As of the Purchase Date and the date of the
transfer of any Margin Excess to Seller, neither the related Participation
Interest nor the related Underlying Whole Loan has been more than 30 days
delinquent, without giving effect to any grace or cure period, in making
required debt service payments since issuance of such Participation Interest or
origination of such Underlying Mortgage Loan, as the case may be, and neither
such Participation Interest nor such Underlying Whole Loan is more than 30 days
delinquent (beyond any applicable grace or cure period) in making required
payments. As of the Purchase Date and the date of the transfer of any Margin
Excess to Seller, to Seller’s Actual Knowledge, there is (a) no material
default, breach, violation or event of acceleration existing under such
Participation Interest or Underlying Whole Loan, and (b) no event (other than
payments due but not yet delinquent) which, with the passage of time or with
notice and the expiration of any grace or cure period, would constitute a
material default, breach, violation or event of acceleration thereunder, which
default, breach, violation or event of acceleration, in the case of either
(a) or (b), materially and adversely affects the value of such Participation
Interest or Underlying Whole Loan or the value, use or operation of the related
Mortgaged Property, provided, however, that this representation and warranty
does not cover any default, breach, violation or event of acceleration that
specifically pertains to or arises out of an exception scheduled to any other
representation and warranty made by Seller in Exhibit VI-I and this Exhibit
VI-II (including, but not limited to, the prior sentence). No person other than
the holder of such Underlying Whole Loan may declare any event of default under
such Underlying Whole Loan or accelerate any indebtedness under the related
Underlying Whole Loan documents.

 

  (8)

Not a Security. Such Participation Interest has not been and shall not be deemed
to be a Security within the meaning of the Securities Act of 1933, as amended or
the Securities Exchange Act of 1934, as amended.

 

VI-II-2

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  (9)

No Notice of Liabilities. As of the Purchase Date, Seller has not received
written notice of any outstanding material liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind for which the holder of such Participation Interest is or may become
obligated under the related Purchased Loan Documents.

 

  (10)

No Advance of Funds. Seller has not advanced funds, or, to Seller’s A c t u a l
Knowledge, as of the Purchase Date, received any advance of funds from a party
other than the Mortgagor relating to such Participation Interest, directly or
indirectly, for the payment of any amount required by such Participation
Interest (other than as contemplated by the related Purchased Loan Documents,
such as, by way of example and not in limitation of the foregoing, amounts paid
by the tenant(s) into a Mortgagee-controlled lockbox if required or contemplated
under the related lease or Purchased Loan Documents).

 

  (11)

No Offsets, Defenses, Etc. As of the Purchase Date, with respect to the related
Participation Interest, there is no valid offset, defense, counterclaim,
abatement or right to rescission with respect to any related Mortgage Note,
Mortgage or other agreements executed in connection therewith that would deny
the holder of such Participation Interest the principal benefits intended to be
provided thereby, except with respect to the related Underlying Whole Loan as
set forth in the representation and warranty in Paragraph 2 (“Loan Document
Status”) in this Exhibit VI-II.

 

  (12)

Bankruptcy. To Seller’s Actual Knowledge as of the Purchase Date and the date of
the transfer of any Margin Excess to Seller, neither the related Mortgaged
Property (other than any tenants of such Mortgaged Property), nor any portion
thereof, is the subject of, and no co-partcipant, co-lender, Mortgagor,
guarantor or tenant occupying a single-tenant property is a debtor in a state or
federal Act of Insolvency, and in the case of any Foreign Purchased Loan, is not
a debtor in any bankruptcy, receivership, conservatorship, reorganization,
insolvency, moratorium, administration, examinership or similar proceeding.

 

  (13)

No Contingent Interest or Equity Participation. Except for such Participation
Interest and such other senior pari passu Participation Interests in the related
Underlying Whole Loan issued in accordance with the Purchased Loan Documents,
the related Underlying Whole Loan d o e s not have a shared appreciation
feature, any other contingent interest feature or a negative amortization
feature (except that an ARD Loan may provide for the accrual of the portion of
interest in excess of the rate in effect prior to the anticipated repayment
date) or an equity participation by Seller (excluding any equity interest held
or pledged in connection with a Mezzanine Loan or preferred equity interest).

 

VI-II-3

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  (14)

Mortgage Status; Waivers and Modifications. Since origination and except by
written instruments set forth in the related Purchased Loan File: (a) the
material terms of the related Mortgage, Mortgage Note, Purchased Loan guaranty,
and related Purchased Loan Documents have not been waived, impaired, modified,
altered, satisfied, canceled, subordinated or rescinded in any respect which
materially interferes with the security intended to be provided by such
Mortgage; (b) no related Mortgaged Property or any portion thereof has been
released from the lien of the related Mortgage in any manner which materially
interferes with the security intended to be provided by such Mortgage or the use
or operation of the remaining portion of such Mortgaged Property; and
(c) neither the related Mortgagor nor the related guarantor has been released
from any of its material obligations under the Purchased Loan.

 

  (15)

Compliance with Usury Laws. To Seller’s Actual Knowledge, in reliance solely
upon legal opinions delivered in connection with a Purchased Loan, the interest
rate (exclusive of any default interest, late charges, yield maintenance charge,
or prepayment premiums) of (i) such Purchased Loan and (ii) the related
Underlying Whole Loan complied (in the case of clause (i), as of the Purchase
Date, and in the case clause (ii), as of the date of origination) with, or was
exempt from, applicable laws including state or federal laws, regulations and
other requirements pertaining to usury.

 

  (16)

Escrow Deposits. All escrow deposits and payments required to be escrowed with
Seller pursuant to each related Purchased Loan are in the possession, or under
the control, of Seller or its servicer, and there are no deficiencies (subject
to any applicable grace or cure periods) in connection therewith, and all such
escrows and deposits (or the right thereto) that are required to be escrowed
with Seller under the related Purchased Loan Documents are being conveyed by
Seller to Buyer or its servicer.

 

  (17)

Origination and Underwriting. The origination practices of Seller (or, to
Seller’s Actual Knowledge, the related originator if Seller was not the
originator of the related Underlying Whole Loan or issuer of such Participation
Interest) with respect to such Participation Interest and the related Underlying
Whole Loan have been, in all material respects, in material compliance with
applicable law; and as of the date of its origination or issuance, as
applicable, such Participation Interest and the related Underlying Whole Loan
(if originated or issued by a Person other than Seller or an Affiliate, to
Seller’s Actual Knowledge), the origination or issuance thereof, as applicable,
complied in all material respects with, or was exempt from, all requirements of
federal, state or local law relating to the origination or issuance of such
Participation Interest and the related Underlying Whole Loan, as applicable;
provided, that such representation and warranty does not address or otherwise
cover any matters with respect to federal, state or local law otherwise covered
in this Exhibit VI-II.

 

VI-II-4

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  (18)

Compliance with Anti-Money Laundering Laws. Seller has complied in all material
respects with all applicable anti-money laundering laws and regulations,
including without limitation the USA PATRIOT Act of 2001, with respect to the
origination of the related Underlying Whole Loan and the creation of such
Participation Interest, the failure to comply with which would have a material
adverse effect on such Underlying Whole Loan or such Participation Interest, as
the case may be.

 

  (19)

Actions Concerning Purchased Loan. To Seller’s Actual Knowledge as of the
Purchase Date, there was no pending or filed action, suit or proceeding,
arbitration or governmental investigation involving any related Mortgagor,
guarantor, or Mortgagor’s interest in the related Mortgaged Property, the
related Mortgage or any other related Purchased Loan Document, an adverse
outcome of which would reasonably be expected to materially and adversely affect
(a) such Mortgagor’s title to such Mortgaged Property, (b) the validity or
enforceability of such Mortgage, (c) such Mortgagor’s ability to perform under
the related Purchased Loan, (d) such guarantor’s ability to perform under the
related guaranty, (e) the principal benefit of the security intended to be
provided by such Purchased Loan Documents, (f) the current principal use of such
Mortgaged Property or (g) title or ownership of Seller and/or Buyer of such
Purchased Loan Documents and/or the rights, title and interests thereunder.

 

  (20)

Underlying Whole Loan Representations and Warranties. Except for the
representations and warranties contained in Paragraph 1 (“Whole Loan; Ownership
of Purchased Loans”), Paragraph 4 (“Mortgage Status; Waivers and
Modifications”), Paragraph 13 (“Actions Concerning Purchased Loan”), Paragraph
19 (“No Contingent Interest or Equity Participation”), Paragraph 21 (“Compliance
with Usury Laws”), Paragraph 36 (“Origination and Underwriting”), Paragraph 37
(“No Material Default; Payment Record”), Paragraph 38 (“Bankruptcy”), Paragraph
42 (“Due Diligence Package”) and Paragraph 45 (“Compliance with Anti-Money
Laundering Laws”), each of the representations and warranties contained in
Exhibit VI-I with respect to Whole Loans is, to Seller’s Actual Knowledge, true
and correct with respect to the related Underlying Whole Loan. To the extent the
related Underlying Whole Loan is identified in the related Diligence Materials
as REMIC eligible, if such Underlying Whole Loan contains a provision for any
defeasance of mortgage collateral, the representation and warranty in Paragraph
33 (“Defeasance”) in Exhibit VI-I is also true and correct with respect to such
related Underlying Whole Loan if clause (ii) thereof read “(ii) the Whole Loan
cannot be defeased within two years after any securitization of such Whole Loan
or the r e l a t e d Participation Interest”. For purposes of this Paragraph 20,
all references to the term “Seller” (other than in respect of Seller’s Actual
Knowledge) and the term “Purchased Loan”, in each case in Exhibit VI-I, shall be
deemed to be references to the related “Mortgage lender” and the related “Whole
Loan”.

 

VI-II-5

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EXHIBIT VI-III

REPRESENTATIONS AND WARRANTIES

REGARDING EACH INDIVIDUAL PURCHASED LOAN

WHICH IS A FOREIGN PURCHASED LOAN (AU)

 

  A.

DEFINED TERMS

“Authorisation” shall mean (a) any consent, registration, filing, agreement,
notice of non objection, notarisation, certificate, licence, approval, permit,
authority or exemption; or (b) in relation to anything which a Government Agency
may prohibit or restrict within a specific period, the expiry of that period
without intervention or action or notice of intended intervention or action.

“Contamination” shall mean, in respect of a property, the presence of Pollutants
(a) in, on or under the property, or (b) in the ambient air and emanating from
the property.

“Controller” shall mean a controller as defined in section 9 of the Corporations
Act 2001

(Cth).

“Encumbrance” shall mean an interest or power (a) reserved in or over an
interest in any asset, including any retention of title, or (b) created or
otherwise arising in or over any interest in any asset under a security
agreement, bill of sale, mortgage, charge, lien, pledge, trust or power or any
other agreement having similar effect, in each case by way of, or having similar
commercial effect to, security for the payment of a debt, any other monetary
obligation or the performance of any other obligation, and includes any
agreement to grant or create any of the above and includes a security interest
within the meaning of section 12(1) of the PPSA.

“Legal Reservations” shall mean (a) the principle that equitable remedies (or
remedies that are analogous to equitable remedies in other jurisdictions) may be
granted or refused at the discretion of a court and the limitation of
enforcement by laws relating to bankruptcy, insolvency, liquidation, court
schemes, moratoria, administration, examinership, reorganisation and other laws
generally affecting the rights of creditors; and (b) the time barring of claims
under any limitation laws, the possibility that an undertaking to assume
liability for or indemnify a person against non-payment of stamp duty or other
Taxes may be void and defences of set-off or counterclaim.

“Loan Obligor” shall mean, in relation to a Foreign Purchased Loan (AU), (a) any
borrower or other person liable for such Foreign Purchased Loan (AU) as
principal debtor, (b) any guarantor of such Foreign Purchased Loan (AU), or
(c) any other person that provides or has provided a Loan Security in respect of
such Foreign Purchased Loan (AU) (including the relevant Mortgagor).

 

VI-III-1

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“Loan Secured Assets” shall mean, in respect of a Foreign Purchased Loan (AU),
the Mortgaged Properties for such Foreign Purchased Loan (AU) and all other
property and rights subject to a Loan Security securing such Foreign Purchased
Loan (AU).

“Loan Security” shall mean, in relation to a Foreign Purchased Loan (AU) means
(a) each Mortgage, (b) each general security agreement (if applicable), (c) each
other Encumbrance, and (d) each guarantee, indemnity or assurance, in each case
that secures, guarantees or provides assurance or is expressed to secure,
guarantee or provide assurance for the payment or repayment or other discharge
of the principal amount of such Foreign Purchased Loan (AU), interest or fee on
such Foreign Purchased Loan (AU) or any other monies payable in respect of such
Foreign Purchased Loan (AU) (and notwithstanding that the terms of the mortgage,
charge, Encumbrance, guarantee, indemnity or other assurance may not secure all
such amounts or may also secure, guarantee or provide assurance for the payment
of other liabilities).

“Pollutant” shall mean a pollutant, contaminant, dangerous, toxic or hazardous
substance, petroleum or petroleum product, chemical, solid, special liquid,
industrial or other waste.

“Permitted Mortgaged Property Encumbrances” shall mean, in relation to a
Mortgaged Property, (a) any lien on the Mortgaged Property relating to rates,
land tax and other Taxes in respect of that Mortgaged Property due and payable
but not yet delinquent; (b) covenants, conditions and restrictions, rights of
way, easements and other matters of a similar nature registered on the
applicable land titles register as a dealing against such Mortgaged Property;
(c) other liens and matters to which like properties are commonly subject;
(d) the rights of tenants (as tenants only) under Leases (including sub-leases)
pertaining to the Mortgaged Property; (e) if the related Foreign Purchased Loan
(AU) is a Senior Interest, the rights if the holder of the related Junior
Interest; and (f) if the related Foreign Purchased Loan (AU) is
cross-collateralised and cross-defaulted with one or more mortgage loans, the
mortgage for the other mortgage loan contained in the same cross-collateralised
and cross-defaulted group of mortgage loans, provided that none of the above
individually, or in aggregate, materially and adversely interferes with the
value or current use of the Mortgaged Property, the enforceability of the
Mortgage over such Mortgaged Property or the relevant Mortgagor’s ability to pay
its obligations in relation to the related Foreign Purchased Loan (AU) as and
when they fall due for payment.

“Required Policy” shall have the meaning specified in paragraph 14(b) of this
Exhibit VI-III.

“Sub-participation Agreement” shall mean, in respect of a Subparticipated Loan,
the agreement between Parlex 2 AU and a creditor in respect of the underlying
Whole Loan under which such creditor grants the Borrower a sub-participation
interest in the relevant Whole Loan.

“Subparticipated Loan” shall mean a Foreign Purchased Loan (AU) in which Parlex
2 AU has been granted a sub-participation interest and is not a lender of
record.

 

VI-III-2

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  B.

REPRESENTATIONS AND WARRANTIES

 

(1)

Sole Legal and Beneficial Owner. Parlex 2 AU is the sole legal and beneficial
owner of (a) such Foreign Purchased Loan (AU) (whether acquired or made) other
than a Subparticipated Loan; (b) all of the Purchased Loan Documents in relation
to such Foreign Purchased Loan (AU) (other than a Subparticipated Loan) other
than any Loan Security which is held by a security trustee; and (c) the
Subparticipation Agreement in respect of each Subparticipated Loan, in each case
free and clear of any Encumbrance, participation or other ownership interest in
relation to its right, title and interest in such Foreign Purchased Loan (AU),
Purchased Loan Documents or Subparticipated Loan (as applicable), other than a
Permitted Lien.

 

(2)

Purchased Loan Document Status. The obligations which are expressed to be
assumed by each Loan Obligor in respect of such Foreign Purchased Loan (AU)
under the applicable Purchased Loan Documents to which it is a party are legal,
valid, binding and enforceable obligations subject only to the Legal
Reservations.

 

(3)

No Set-Off, Counterclaim. Any amounts payable under any related Purchased Loan
Document will be payable without set-off or counterclaim and Parlex 2 AU is not
aware that any Loan Obligor has any valid defence or counterclaim to payment in
full of such Foreign Purchased Loan (AU) or any right of rescission in respect
of a related Purchased Loan Document.

 

(4)

Waivers and Amendments. Since origination of such Foreign Purchased Loan (AU),
except by written instruments included in the related Purchased Loan File:
(a) the material terms of the Loan Security in respect of such Foreign Purchased
Loan (AU) have not been waived, impaired, modified, altered, satisfied,
cancelled, subordinated or rescinded in any respect which materially interferes
with the security intended to be provided by such Loan Security; (b) no Loan
Secured Assets in respect of such Foreign Purchased Loan (AU) or any portion
thereof have been released from the relevant Loan Security in any manner which
materially interferes with the security intended to be provided by such Loan
Security or the use or operation of the remaining portion of such Loan Secured
Assets; and (c) no Loan Obligor in respect of such Foreign Purchased Loan (AU)
has been released from any of its material obligations in respect of such
Foreign Purchased Loan (AU).

 

(5)

Encumbrance Permitted. No related Purchased Loan Document prohibits or restricts
Parlex 2 AU from, or otherwise requires Parlex 2 AU to obtain the consent of, or
consult with, any Loan Obligor prior to: (a) granting an Encumbrance over its
right, title and interest in and to that Purchased Loan Document (or the rights
thereunder); or (b) assigning its rights, or transferring its rights and
obligations, under such Purchased Loan Document.

 

VI-III-3

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(6)

Perfection and Registration. Each Mortgage or other Loan Security in respect of
such Foreign Purchased Loan (AU): (a) creates the Encumbrance purported to be
created by it over the assets purported to be encumbered by it; (b) has been
perfected in relation to all Loan Secured Assets expressed to be subject to that
Mortgage or other Loan Security (as applicable); and (c) has the priority it is
intended to have.

 

(7)

No Notice of Encumbrances. Other than a Permitted Mortgaged Property Encumbrance
or as disclosed by or on behalf of Parlex 2 AU in writing in the Due Diligence
Package relating to such Foreign Purchased Loan (AU), Parlex 2 AU has not
received notice from any Person that claims to have an Encumbrance ranking in
priority to or equal with the Encumbrance held by Parle 2 AU and constituted by
the Loan Security for such Foreign Purchased Loan (AU).

 

(8)

Condition of Mortgaged Property. Parlex 2 AU or the originator of such Foreign
Purchased Loan (AU) (if not Parlex 2 AU) inspected or caused to be inspected the
Mortgaged Property for such Foreign Purchased Loan (AU) within six (6) months of
origination of such Foreign Purchased Loan (AU) and within thirteen (13) months
of the related Purchase Date; a technical due diligence report was prepared in
connection with the origination of such Foreign Purchased Loan (AU) no more than
thirteen (13) months prior to the related Purchase Date; and to Parlex 2 AU’s
Actual Knowledge, based solely on due diligence customarily performed in
connection with the origination of comparable mortgage loans and except as
disclosed in any technical due diligence report relating to a related Mortgaged
Property delivered to Buyer, as of the related Purchase Date, each Mortgaged
Property for such Foreign Purchased Loan (AU) was free and clear of material
damage that would materially and adversely affect the use or value of such
Mortgaged Property as security for that Foreign Purchased Loan (AU) (excluding
any such material damage relating to either deferred maintenance for which
reserves were established at origination or which is fully covered by
insurance).

 

(9)

Taxes and Assessments. To the extent that prior to the related Purchase Date,
there were any delinquent Taxes which could give rise to a lien on the related
Mortgaged Property ranking prior or equal to the related Mortgage, to Parlex 2
AU’s Actual Knowledge, such Taxes have been paid, or an escrow of funds has been
established in an amount sufficient to cover such payments and any reasonably
estimated interests and penalties thereon. For the purposes of this paragraph
(9), a Tax shall not be considered delinquent until the earlier of the date on
which interest and/or penalties would first be payable thereon; and the date on
which enforcement action is entitled to be taken by the relevant Governmental
Agency.

 

(10)

Subordinated Interests. There are, as of origination, and to Parlex 2 AU’s
Actual Knowledge, no Encumbrances affecting the Mortgaged Property relating to
such Foreign Purchased Loan (AU) that secure the payment of money which are
subordinated or otherwise rank in priority behind the relevant Mortgage other
than Junior Interests (if applicable) or Permitted Mortgaged Property
Encumbrances; and except as disclosed in the Due Diligence Package for the
relevant Foreign Purchased Loan (AU), Parlex 2 AU has no Actual Knowledge of any
mezzanine or junior debt secured directly by interests in such Loan Obligor in
respect of such Foreign Purchased Loan (AU).

 

VI-III-4

--------------------------------------------------------------------------------

(11)

Leases and Rents. Subject to the Legal Reservations, except as disclosed to
Buyer in the Due Diligence Package for such Foreign Purchased Loan (AU), the
Loan Security for such Foreign Purchased Loan (AU) creates a valid, first
priority Encumbrance in rents and certain rights of the related Loan Obligor
under any lease or leases of the Mortgaged Property, subject to any Permitted
Liens; and the applicable Loan Security provides that upon an event of default
(howsoever described) in respect of the such Foreign Purchased Loan (AU), a
Controller is permitted to be appointed or the Mortgagee may enter into
possession, in either case, to collect rents or for rents to be paid directly to
the Mortgagee.

 

(12)

No Litigation. To Parlex 2 AU’s Actual Knowledge as of the related Purchased
Date, no litigation, administration proceedings, government investigation or
arbitration is pending involving any Loan Obligor in respect of such Foreign
Purchased Loan (AU), the relevant Mortgagor’s interest in its Mortgaged
Property, or any related Purchased Loan Document, which adversely determined,
would be reasonably expected to materially and adversely affect: (a) the
relevant Mortgagor’s title to the Mortgaged Property; (b) the validity or
enforceability of the relevant Mortgage; (c) the relevant Mortgagor’s ability to
perform its obligations in respect of the related Foreign Purchased Loan (AU);
(d) the ability of any relevant Loan Obligor that is a guarantor to perform its
obligations under the related guarantee; (e) the principal benefit of the
security intended to be provided by the related Loan Security; (f) the then
current principal use of the relevant Mortgaged Property; or (g) the title or
ownership of Parlex 2 AU of the relevant Purchased Loan Documents (or, in the
case of a Subparticipated Loan, the relevant Subparticipation Agreement) and/or
its rights, title and interest thereunder.

 

(13)

No Additional Funding. Other than a Foreign Purchased Loan (AU) which has been
identified to Buyer in writing as requiring further advances, the principal
amount of the relevant Foreign Purchased Loan (AU) as stated in the related Due
Diligence Package has been, or simultaneously with the provision of the Margin
Excess (Future Funding) under the relevant Transaction will be, fully disbursed
as at the related Purchase Date and there is no requirement for future advances
thereunder (excluding where a portion of the disbursed Foreign Purchased Loan
(AU) is escrowed or held in a reserve account pending the satisfaction of
certain conditions relating to leasing, repairs or other matters with respect to
the relevant Mortgaged Property, the relevant Mortgagor or other considerations
determined by Palex 2 AU to merit such holdback.

 

(14)

Insurance.

 

  (a)

each related Mortgaged Property is, and is required pursuant to the related
Purchased Loan Documents to be, insured (i) against damage, destruction and any
other risk in an amount (subject to a customary deductible) that is no less than
the lesser of (x) the outstanding principal balance of the relevant Foreign
Purchased Loan (AU) and (y) the full insurable value on a replacement or
reinstatement cost basis of the improvements, furniture, furnishings, fixtures
and equipment owned by the related Mortgagor and included in the related
Mortgaged Property; and (ii) for workers’ compensation, public liability and
business interruption, in each case, with a reputable and substantial insurer;

 

VI-III-5

--------------------------------------------------------------------------------

  (b)

as at the related Purchased Date, all premiums on all insurance policies
referred to in paragraph (14)(a) above (each a “Required Policy”) relating to
the related Mortgaged Property have been paid to the extent the same have fallen
due;

 

  (c)

each Required Policy for a related Mortgaged Property (other than a worker’s
compensation or public liability insurance policy) names the relevant Mortgagee
as the loss payee;

 

  (d)

the relevant Purchased Loan Documents require the Loan Obligors to notify Parlex
2 AU (or any facility or similar agent, or security trustee, in respect of such
Foreign Purchased Loan (AU)) of any cancellation or termination of a Required
Policy; and

 

  (e)

the relevant Purchased Loan Documents require proceeds from any insurance claim
made in respect of a property loss to be applied either (x) to the repair,
restoration or reinstatement of all or part of the related Mortgaged Property to
which the relevant claim relates where the property loss exceeds 5% of the then
outstanding principal balance of such Foreign Purchased Loan (AU), or (y) to the
payment of the outstanding principal balance of such Foreign Purchased Loan (AU)
together with any accrued interest thereon.

 

(15)

No Encroachments. To Parlex 2 AU’s Actual Knowledge, based solely on searches of
the land titles registry service for the state or territory in which the related
Mortgaged Property is located obtained by Parlex 2 AU in connection with the
origination of such Foreign Purchased Loan (AU), (a) all material improvements
that were included for the purposes of determining the appraised value of any
related Mortgaged Property at the time of origination of such Foreign Purchased
Loan (AU) are within the boundaries of the such Mortgaged Property (except for
encroachments that do not materially or adversely affect the value or current
use of such Mortgaged Property), (b) is no encroachment onto any related
Mortgaged Property by improvements on or used with adjoining land which
materially and adversely affects the value or current use of such Mortgaged
Property, (c) no improvements encroach upon any easements affecting any related
Mortgaged Property where such encroachment materially and adversely affects the
value and current use of that Mortgaged Property; and (d) the related Mortgaged
Property is not affected by any easement, restriction, right, interest or claim
derived under the Native Title Act 1993 (Cth).

 

(16)

Authorisations. Each Mortgagor covenants in the relevant Purchased Loan
Documents that it shall keep all Authorisations required in relation to the
Mortgaged Property in full force and effect where failure to do so will have, or
will be reasonably likely to have, a material adverse effect on the Mortgagor’s
ability to perform its material obligations under the relevant Purchased Loan
Documents or the enforceability or priority of the relevant Mortgage.

 

VI-III-6

--------------------------------------------------------------------------------

(17)

Financial Reporting. Each related Purchased Loan Agreement requires one or more
of the relevant Loan Obligors to provide the creditor in respect of such Foreign
Purchased Loan (AU) (or any facility or similar agent, or security trustee, in
respect of such Foreign Purchased Loan (AU)) with the following: (a) annual
audited financial statements for the relevant Loan Obligors (consolidated if
applicable); (b) semi-annual unaudited management accounts of the Loan Obligors;
(c) quarterly property management reports (other than for single-tenant
properties); (d) quarterly rent rolls and forecasts of expenses for any
Mortgaged Property (other than a single-tenant property) that has Leases
contributing more than 5% of the in place base rent; and (e) annual Appraisals
for the relevant Mortgaged Property;

 

(18)

Servicing. The servicing and collection practices used by Parlex 2 AU (or any
appointed Servicer) with respect to such Foreign Purchased Loan (AU) have been,
in all respects, legal and have met customary industry standards for servicing
of commercial loans.

 

(19)

Origination and Underwriting. The origination practices of Parlex 2 AU (or, to
Parlex 2 AU’s Actual Knowledge, the relevant originator if Parlex 2 AU was not
the originator) with respect to such Foreign Purchased Loan (AU) have been, in
all material respects, in material compliance with applicable law; and as of the
date of its origination, to Parlex 2 AU’s Actual Knowledge (where Parlex 2 AU
was not the originator), such Foreign Purchased Loan (AU) and the origination
thereof complied in all material respects with, or was exempt from, all
applicable laws relating to the origination of such Foreign Purchased Loan (AU),
provided that the representation and warranty in this paragraph (19) does not
address or otherwise cover any matters with respect to laws otherwise covered in
other paragraphs of this Exhibit VI-III.

 

(20)

No Material Default; Payment Record. As of the related Purchase Date and the
date of advancing any Margin Excess to Parlex 2 AU in respect of such Foreign
Purchased Loan (AU): (a) such Foreign Purchased Loan (AU) has not been more than
thirty (30) days delinquent, without giving effect to any grace or cure period,
in making required debt service payments since origination, such Foreign
Purchased Loan (AU) is not more than thirty (30) days delinquent (beyond any
applicable grace or cure period) in making required payments; and (b) to Parlex
2 AU’s Actual Knowledge, there is no (x) material default, breach, violation or
event of acceleration existing under such Foreign Purchased Loan (AU), or
(y) event (other than payments due but not yet delinquent) which, with the
passage of time or with notice and the expiration of any grace or cure period,
would constitute a material default, breach, violation or event of acceleration,
which in either case, materially and adversely affects the value of such Foreign
Purchased Loan (AU) or the value, use or operation of the related Mortgaged
Property.

 

(21)

Compulsory Acquisition. Parlex 2 AU has not received notice of any pending or,
to its Actual Knowledge, threatened steps to affect the compulsory purchase of
all or any material portion of any related Mortgaged Property; and to Parlex 2
AU’s Actual Knowledge (based on Appraisals obtained in connection with the
origination of the relevant Foreign Purchased Loan (AU)) as of the date of the
origination of such Foreign Purchased Loan (AU), no such Appraisal disclosed any
matter or thing that would materially and adversely affect the value or
marketability of the relevant Mortgaged Property.

 

VI-III-7

--------------------------------------------------------------------------------

(22)

Insolvency. To Parlex 2 AU’s Actual Knowledge as of the related Purchase Date
and as of the date of the advance of any Margin Excess to Parlex 2 AU in respect
of such Foreign Purchased Loan (AU): (a) neither the related Mortgaged Property,
nor any portion thereof, is the subject of any bankruptcy, receivership,
administration, insolvent winding up or similar proceeding; and (b) no
Controller, trustee in bankruptcy, administrator, liquidator or similar officer
has been and remains appointed to a Loan Obligor for such Foreign Purchased Loan
(AU) or, where the related Mortgaged Property is a single-tenant property, the
tenant of the Mortgaged Property.

 

(23)

Environmental Laws. In relation to such Foreign Purchased Loan (AU) and its
related Mortgaged Property: (a) to Parlex 2 AU’s Actual Knowledge, there is no
Contamination on, in or under or migrating to or from, that Mortgaged Property
which is reasonably likely to have a Material Adverse Effect; (b) there is no
material violation of Environmental Law with respect to the Mortgaged Property;
(c) the related Purchased Loan Documents require the relevant Loan Obligors to
materially comply with all applicable Environmental Laws.

 

(24)

Due Diligence Package. To Parlex 2 AU’s Actual Knowledge, the information
pertaining to such Foreign Purchased Loan (AU) which is set for in the relevant
Due Diligence Package is true and correct in all material respects as of the
related Purchase Date.

 

(25)

Compliance with Anti-Money Laundering Laws. Parlex 2 AU has complied in all
material respects with all applicable anti-money laundering laws and regulations
with respect to the origination of such Foreign Purchased Loan (AU) (if
originated by Parlex 2 AU), the failure to comply with which would have a
material adverse effect on such Foreign Purchased Loan (AU).

 

(26)

Title. Parlex 2 AU obtained from its lawyer or the lawyer for the relevant Loan
Obligor(s), a legal property due diligence report covering title matters which
showed no adverse entries, or, if such report did reveal any adverse entries,
such report satisfactorily indicated that such entries would not have caused a
reasonably prudent lender of money secured on commercial property to decline to
proceed with the related advance on its agreed terms.

 

(27)

Cross-Collateralisation. No Foreign Purchased Loan (AU) is cross-collateralized
with any other loan or security which is not a Purchased Loan.

 

VI-III-8

--------------------------------------------------------------------------------

(28)

Acceleration. The applicable Purchased Loan Documents for such Foreign Purchased
Loan (AU) contain provisions which give the holder (or, in the case of a
syndicated Foreign Purchased Loan (AU), the facility agent on the instructions
of holders representing no less than a majority by commitments) the right to
accelerate the payment of the unpaid principal balance of such Foreign Purchased
Loan (AU) if (a) there is a disposal of any related Mortgaged Property or of the
equity interests the relevant Mortgagor, or (b) any Encumbrance is created over
any related Mortgaged Property or the relevant Mortgagor, in each case, in
contravention of the terms of applicable Purchased Loan Documents (and subject
to any applicable grace periods specified in the Purchased Loan Documents for
remedy).

 

(29)

Approval Rights. Under the terms of the applicable Purchased Loan Documents:

 

  (a)

no material terms of the related Mortgage may be waived, cancelled, subordinated
or modified in any material respect and no material portion of the Mortgage or
the related Mortgaged Property may be released without the consent of the holder
of such Foreign Purchased Loan (AU) (or where such Foreign Purchased Loan (AU)
is syndicated, without the consent of the facility agent for such Foreign
Purchased Loan (AU) acting on the instructions of no less than a majority by
commitments of the holders of such Foreign Purchased Loan (AU)), except to the
extent such release is permitted under the terms of the applicable Purchased
Loan Documents;

 

  (b)

no material action adversely affecting the value of the related Mortgaged
Property may be taken by the owner of the Mortgaged Property without the consent
of the holder of the applicable Purchased Loan Documents (or where such Foreign
Purchased Loan (AU) is syndicated, without the consent of the facility agent for
such Foreign Purchased Loan (AU) acting on the instructions of no less than a
majority by commitments of the holders of such Foreign Purchased Loan (AU)); and

 

  (c)

the consent of the holder of the applicable Purchased Loan Documents (or where
such Foreign Purchased Loan (AU) is syndicated, the consent of the facility
agent for such Foreign Purchased Loan (AU) acting on the instructions of no less
than a majority by commitments of the holders of such Foreign Purchased Loan
(AU)) is required prior to the owner of the related Mortgaged Property incurring
any additional indebtedness subject to such exceptions as are customarily
acceptable to prudent commercial and multifamily mortgage lending institutions
lending on the security of property comparable to the Mortgaged Property in
Australia.

 

(30)

Reserves. All reserves, funds, escrows and deposits required pursuant to the
terms of the Purchased Loan Documents for such Foreign Purchased Loan (AU) have
been so funded and deposited, are in the possession, or under the control, of
the creditor of such Foreign Purchased Loan (AU) (or an agent or trustee for the
creditor (or creditors) of such Foreign Purchased Loan (AU)) and, to Parlex 2
AU’s Actual Knowledge, there are no deficiencies in connection therewith.

 

(31)

Appraisals. An Appraisal of the Mortgaged Property securing such Foreign
Purchased Loan (AU) was conducted within twelve (12) months of the origination
of such Foreign Purchased Loan (AU).

 

VI-III-9

--------------------------------------------------------------------------------

(32)

No Fraud. No fraudulent acts were committed by Parlex 2 AU in connection with
its acquisition or origination (as applicable) of such Foreign Purchased Loan
(AU) nor, to Parlex 2 AU’s Actual Knowledge, were any fraudulent acts committed
by any person in connection with the origination of such Foreign Purchased Loan
(AU).

 

(33)

No Equity Participation; No Contingent Interest. No Foreign Purchased Loan
(AU) (a) contains an equity participation by the holder of such Foreign
Purchased Loan (AU) or shared appreciation feature or profit participation
feature, (b) provides for negative amortization, (c) provides for any contingent
or additional interest in the form of participation in the cash flow of the
related Mortgaged Property, or (d) has capitalised interest included in its
principal balance.

 

VI-III-10

--------------------------------------------------------------------------------

EXHIBIT VII

COLLATERAL TAPE

 

              Appraisal   Appraisal   Appraisal   Appraisal   Appraisal  
Appraisal   Appraisal   Appraisal   Appraisal   Rent Roll   Appraisal  

Rent Roll-

Physical

  Rent Roll   All Debt-
Calc  

Calc

 

  Mortgage  

B-Note

Original

Balance

 

Mezzanine

Debt

Original

Balance

   Calc

Property
ID

  

 

   Number of
Mortgaged
Properties   Property
Name   Address   City   State   Zip Code   General
Property
Type   Detailed
Property
Type   Year
Built   Year
Renovated   UniteS,
Pads,
Rooms, Sq.
FL   Unit
Description   Occupancy
(%)   Occupancy
Date   Total Debt
Original
Balance   Whole
Loan
Original
Balance   A-Note
Original
Balance   B-Note
Original
Balance   Mezzanine
Debt
Original
Balance    Total Debt
Cut-off
Balance

 

 

VII-1

--------------------------------------------------------------------------------

Calc    Calc    Calc    Calc    Calc    Calc    Calc    Calc    Calc    Calc   
Calc    Calc    Calc    Calc    Calc    Calc    Calc    Loan Amgt    Loan
Amgt    Calc

Whole
Loan
Cut-
off
Balance

   A-Note
Cut-off
Balance    B-Note
Cut-off
Balance    Mezzanine
Debt Cut-
off Balance    Total Debt
Initial
Maturity
Balance    Whole
Loan
Initial
Maturity
Balance    A-Note
Initial
Maturity
Balance    B-Note
Initial
Maturity
Balance    Mezzanine
Debt
Initial
Maturity
Balance    Total
Debt
Final
Maturity
Balance    Whole
Loan
Final
Maturity
Balance    A-Note
Final
Maturity
Balance    B-Note
Final
Maturity
Balance    Mezzanine
Debt Final
Maturity
Balance    A-Note
Loan
Per
Unit    Whole
Loan
Loan
Per
Unit    Total
Debt
Loan
Per
Unit   

 

Amortization
Type
(During
Initial Term
and
Extended
Term)

   Interest
Accrual
Method    Original
Term
(Excluding
Extensions)

 

VII-2

--------------------------------------------------------------------------------

Loan
Agmt   Loan
Agmt   Calc   calc   calc   calc   calc      

Loan

Agmt

 

Loan

Agmt

 

Loan

Agmt

 

Loan

Agmt

 

Loan

Agmt

 

Loan

Agmt

 

Loan

Agmt

 

Loan

Agmt

 

Loan

Agmt

 

Loan

Agmt

         

Loan

Agmt

 

Loan

Agmt

Original
Amortization
Term
(Excluding
Extensions)

  original
Term
(Including
Extension
Options)   IO
Period   Seasoning   Remaining
Term to
Maturity   Remaining
Amortization
Term   Remaining
Term
(Including
Extensions)   Remaining
Amortization
Term
(Including
Extensions)   Origination
Date   First
Due
Date   Initial
Maturity
Date   Extension
Options
(Yes/no)   Extension
Options
Description   Fully
Extended
Maturity
Date   First
Extension
Fee   Second
Extension
Fee   Third
Extension
Fee   Extension
Test
Description   Extension
Spread
Increase
(Yes/No)   Extension
Spread
Increase
Description   Exit
Fees   Payment
Day or
Month

 

VII-3

--------------------------------------------------------------------------------

Strike Price      Loan
Agmt    Loan
Agmt    Loan
Agmt    Loan
Agmt    Loan
Agmt    Loan
Agmt    Loan
Agmt    Loan Agmt    Loan
Agmt    Loan
Agmt    Loan
Agmt    Loan
Agmt   

Cap

Agreement

  

Cap

Agreement

   Bloomberg    Loan
Agmt    Loan
Agmt    Loan
Agmt    Loan
Agmt    Loan
Agmt                                                            

Payment
Date
Business
Day
Convention)

   Payment
Grace
Period
Event of
Default    Payment
Grace
Period
Event or
Late Fee    Balloon
Grace
Period
Event
or
Default    Balloon
Grace
Period
Event
of Late
Fee    Interest
accrual
period
start    Interest
accrual
period
end    Interest
rate
adjustment
frequency    LIBOR
rounding
methodology    LIBOR
Lookback
Days    LIBOR
Floor    LIBOR
Cap    LIBOR
Cap
after
Extension    LIBOR
Cap
expiration
date    LIBOR
Cap
provider    LIBOR
Cap
provider
rating    Total
Debt
Margin    Whole
Loan
Margin    A-Note
Margin    B-Note
Margin    Mezzanine
Margin

 

VII-4

--------------------------------------------------------------------------------

Calc    calc   Calc   Calc   Calc   Calc   Loan
Agmt   calc   Calc       Loan
Agmt                                         

Total
Debt
interest
Rate

   Whole
Loan
interest
Rate   Trust
Asset
interest
Rate   Total
Debt
Interest
Rate
(At
LIBOR
Cap)   Whole
Loan
Interest
Rate
(At
LIBOR
Cap)   Trust
Asset
Interest
Rate
(At
LIBOR
Cap)   Original
Lockout
Payments   Remaining
Lockout
Payments   Lockout
End
Date   Spread
Maintenance   Open
payments   Prepayment
string   Partially
Prepayable
without
Penalty   Partially
Prepayable
without
Penalty
Description   Partial
Collateral
Release
[Y/N]   Partial
Collateral
Release
Description   Substitution
Allowed [Y/
N]   Substitution
Provision
Description   LockBox
[Y/N]   Lockbox
Type    Terms/
Description
of
Springing
Lockbox (if
applicable)

 

VII-5

--------------------------------------------------------------------------------

 

    

Closing

Statement

  

Servicer

Tape

  Loan
Agreement   Loan
Agreement  

Closing

Statement

 

Servicer

Tape

  Loan
Agreement  

Loan

Agreement

 

Loan

Agreement

     

Loan

Agreement

 

Closing

Statement

                                     

Cash
Manageme
nt
Triggers

   upfront
RE Tax
Reserve    Monthly
RE Tax
Reserve   Tax
Reserve
Cap   Terms/
Description
of
Springing
Tax
Reserve (if
applicable)   Upfront
insurance
Reserve   Monthly
Insurance
Reserve   Terms/
Description
of
Springing
insurance
(if Reserve
applicable)   Upfront
Replacement
Reserve   Monthly
Replacement
Reserve   Replacement
Reserve Cap   Terms/
Description
of Springing
Replacement
Reserve (if
applicable)   Upfront
Capex
Reserve   upfront
TI/LC
Reserve  

 

  TI/LC
Reserve
Cap   Terms/
Description
of
Springing
TI/LC
Reserve (If
Cap
applicable   Upfront
Debt
Service
Reserve   Monthly
Debt
Service
Reserve   Other
Reserve
Description    Upfront
Otner
Reserve    Monthly
Other
Reserve

 

VII-6

--------------------------------------------------------------------------------

          Appraisal    Appraisal    Appraisal    Appraisal                    
                                            

Other

Reserve

Cap

   Terms/
Description
of
Springing
Other
Reserve (if
appilcable)    Appraised
Value (s)    Appraisal
Type    Appraisal
Cap Rate    Appraised
Value
Date    Envirnomental
Phase I
Date    Phase II
Recommended    Environmental
Phase
II Date    Engineering
Report
Date    Selemic
Report
Date    PML
or
SEL
(%)    ownership
Interest    Ground
Lease
Expiration    Ground
Lease
Extension
Options    Annual
Ground
Lease
Payment    Ground
Lease
Escalation
Terms    Borrower
Name    Recourse
Guarantor

 

 

VII-7

--------------------------------------------------------------------------------

EXHIBIT VIII

FORM OF TRANSACTION REQUEST

Ladies and Gentlemen:

Pursuant to Section 3(a) of that certain Third Amended and Restated Master
Repurchase Agreement, dated as of October 12, 2018 (the “Agreement”), among
Citibank, N.A. (“Buyer”) and [list Seller entities other than the “Seller”
defined hereunder] and any Person that joins as a Seller (as such term is
defined in the Agreement) under the Agreement from time to time, [__________],
LLC (“Seller”) hereby requests that Buyer enter into a Transaction with respect
to the Eligible Loans set forth on Schedule 1 attached hereto, upon the proposed
terms set forth below. Capitalized terms used herein without definition have the
meanings given in the Agreement.

 

            Proposed Eligible Loan:    [__________________]
            Aggregate Principal Amount of    [$/£/€/A$_________________]
            Proposed Eligible Loan:                Amount of Purchase Price   
[$/£/€/A$_________________]             Requested by Seller:   

 

VIII-1

--------------------------------------------------------------------------------

Name and address for    Buyer:       communications:                Citibank,
N.A.       388 Greenwich Street       New York, New York 10013       Attention:
   Richard Schlenger       Telephone:    (212) 816-7806       Email:
Richard.Schlenger@Citi.com    Seller:             [________________], LLC      
c/o Blackstone Mortgage Trust, Inc.       345 Park Avenue       New York, NY
10154       Attention: Douglas Armer       Tel: (212) 583-5000       Email:
BXMTCitiRepo@blackstone.com

 

VIII-2

--------------------------------------------------------------------------------

SELLER:

[_________________________], LLC,

a Delaware limited liability company

By:  

 

Name:   Title:  

 

VIII-3

--------------------------------------------------------------------------------

Schedule 1 to Transaction Request

(Attachments: Collateral Tape and Eligible Loan Due Diligence Checklist)

 

 

Eligible Loan:

Aggregate Principal Amount of Eligible Loan: [$/£/€/A$______________]

 

VIII-4

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Schedule 2 to Transaction Request

Exceptions to Representations and Warranties Set

Forth on Exhibit VI

 

VIII-5

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EXHIBIT IX

FORM OF REQUEST FOR MARGIN EXCESS

Ladies and Gentlemen:

Pursuant to Section [4(c)][4(e)] of that certain Third Amended and Restated
Master Repurchase Agreement, dated as of October 12, 2018 (the “Agreement”),
among Citibank, N.A. (“Buyer”) and [list Seller entities other than the “Seller”
defined hereunder] and any Person that joins as a Seller (as such term is
defined in the Agreement) under the Agreement from time to time, [__________],
LLC (“Seller”) hereby requests that Buyer transfer cash to Seller with respect
to the Purchased Loan described below in the amount set forth below. Capitalized
terms used herein without definition have the meanings given in the Agreement.

 

Purchased Loan:

   [__________________]

Amount of Increase in outstanding Purchase Price Requested by Seller:

   [$/£/€/A$_________________] [Describe how Amount Calculated]

Type of Margin Excess:

   [Margin Excess (Future Funding)]    [Margin Excess (Other) – [DESCRIBE
REASON:    Margin Deficit, Prior Paydown without Release of    Collateral,
Original Purchase Price less than    Maximum Purchase Price]]

 

IX-1

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Name and address for    Buyer:       communications:                Citibank,
N.A.       388 Greenwich Street       New York, New York 10013       Attention:
   Richard Schlenger       Telephone:    (212) 816-7806       Email:
Richard.Schlenger@Citi.com    Seller:             [______________________], LLC
      c/o Blackstone Mortgage Trust, Inc.       345 Park Avenue       New York,
NY 10154       Attention:    Douglas Armer       Tel: (212) 583-5000      
Email: BXMTCitiRepo@blackstone.com

 

IX-2

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SELLER:

[______________________], LLC,

a Delaware limited liability company

By:  

 

Name:   Title:  

 

IX-3

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EXHIBIT X

FORM OF IRREVOCABLE DIRECTION LETTER14

[SELLER]

[LETTERHEAD]

IRREVOCABLE DIRECTION LETTER

AS OF [         ], 20[        ]

Ladies and Gentlemen:

Please refer to: (a) that certain [Loan Agreement], dated [    ], 20[__], by and
among [            ] (the “Borrower”), as borrower, and [_____________] (the
“Lender”), as lender; and (b) all documents securing or relating to that certain
[$/£/€/A$    ] loan made by the Lender to the Borrower on [    ], 20[__] (the
“Loan”).

You are advised as follows, effective as of the date of this letter.

Assignment of the Loan. The Lender has entered into that certain Third Amended
and Restated Master Repurchase Agreement, dated as October 12, 2018 (as the same
may be amended, supplemented, extended, restated, replaced and/or otherwise
modified from time to time, the “Repo Agreement”), with Citibank, N.A. (“Citi”),
388 Greenwich Street, New York, New York 10013, [list Seller entities other than
the “Lender” defined hereunder] and any other Person that joins as a Seller
under the Repo Agreement from time to time, and has assigned its rights and
interests in the Loan (and all of its rights and remedies in respect of the
Loan) to Citi. This assignment shall remain in effect unless and until Citi has
notified Borrower otherwise in writing.

Direction of Funds. In connection with Lender’s obligations under the Repo
Agreement, Lender hereby directs Borrower to disburse, by wire transfer, any and
all payments to be made under or in respect of the Loan to the following account
at [____________] for the benefit of Citi:

______________

______________

______________

 

14 

On the Purchase Date for each Foreign Purchased Loan, this Exhibit X shall be
reasonably revised as mutually agreed upon by Buyer and Seller to reflect any
equivalent terminology, customary market practices and Requirements of Law in
the relevant non-U.S. jurisdiction, in each case applicable to such Foreign
Purchased Loan.

 

X-1

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Account: _____________

Attn: ____________________

This direction shall remain in effect unless and until Citi has notified
Borrower otherwise in writing.

Modifications, Waivers, Etc. No modification or waiver of any party’s
obligations in respect of this letter shall be effective without the prior
written consent of Citi.

 

X-2

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Please acknowledge your acceptance of the terms and directions contained in this
correspondence by executing a counterpart of this correspondence and returning
it to the undersigned.

[Signature Page Follows]

 

X-3

--------------------------------------------------------------------------------

 

Very truly yours,

[______________________________], a Delaware limited liability company

By:  

 

Name:   Title:   Date: [            ], 20[__]

 

Agreed and accepted this [    ] day of [            ], 20[__]
[                             ]

By:  

 

Name:  

 

Title:  

 

 

X-4

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EXHIBIT XI

FORM OF JOINDER AGREEMENT

This JOINDER AGREEMENT (this “Joinder Agreement”) dated as of [•], is made by
and among Parlex 2 Finance, LLC, Parlex 2A Finco, LLC, Parlex 2 UK Finco, LLC,
Parlex 2 EUR Finco, LLC, Parlex 2 AU Finco, LLC, [ADD OTHER PREVIOUSLY ADDED
SELLERS], each a Delaware limited liability company (collectively, the “Existing
Sellers”), [•], a Delaware limited liability company] (the “Joining Seller”) and
Citibank, N.A. (“Buyer”).

W I T N E S S E T H:

WHEREAS, Existing Sellers and Buyer, entered into that certain Third Amended and
Restated Master Repurchase Agreement, dated as of October 12, 2018 (as the same
may be amended, supplemented, extended, restated, replaced or otherwise modified
from time to time, the “Repurchase Agreement”), pursuant to which Existing
Sellers agreed to sell to Buyer certain Eligible Loans upon the terms and
subject to the conditions set forth therein (each such transaction, a
“Transaction”);

WHEREAS, all capitalized terms used herein and not otherwise defined shall have
the respective meanings set forth in the Repurchase Agreement; and

WHEREAS, Existing Sellers and Buyer desire to modify certain terms and
provisions of the Repurchase Agreement and the other Transaction Documents to
admit Joining Seller to the Repurchase Agreement and the other Transaction
Documents as a Seller in accordance with this Joinder Agreement.

NOW, THEREFORE, in order to induce Buyer to enter into a Transaction with
Joining Seller, and in consideration of the substantial benefit Joining Seller
will derive from Buyer entering into such Transaction, and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and intending to be legally bound hereby, Joining Seller hereby
agrees as follows:

1. In consideration of Joining Seller becoming a Seller entitled to enter into
Transactions with Buyer under and subject to the terms and conditions of the
Repurchase Agreement, Joining Seller hereby agrees that, effective as of the
date hereof, Joining Seller is, and shall be deemed to be, a “Seller” under the
Repurchase Agreement and each of the other Transaction Documents to which a
Seller is a party (including, without limitation, the Fee Agreement), and agrees
that from the date hereof and so long as the Repurchase Obligations remain
outstanding, Joining Seller hereby assumes the obligations of a “Seller” under,
and Joining Seller shall perform, comply with and be subject to and bound by
each of the terms, covenants and conditions of the Repurchase Agreement and each
of the other Transaction Documents which are stated to apply to or are made by a
Seller (including, without limitation, the Fee Agreement).

 

 

XI-1

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Without limiting the generality of the foregoing, Joining Seller hereby
represents and warrants that (i) each of the representations and warranties set
forth in Section 10 of the Repurchase Agreement are true and correct as to
Joining Seller and its related Purchased Loan on and as of the date hereof and
(ii) Joining Seller has heretofore received true and correct copies of the
Repurchase Agreement and each of the other Transaction Documents as in effect on
the date hereof.

2. Without limiting the foregoing, Joining Seller agrees that it is and shall be
obligated to pay the Repurchase Price applicable to its Purchased Loan on the
Repurchase Date therefor and perform and pay all of the other Repurchase
Obligations applicable to Joining Seller and such Purchased Loan as if it were
an original party to the Repurchase Agreement (including, without limitation,
all obligations arising under the Fee Agreement) and agrees to execute and
deliver such documents, agreements and other instruments as Buyer may reasonably
request in connection with such Joining Seller’s obligations hereunder and under
the Repurchase Agreement and the other Transaction Documents.

3. In furtherance of the foregoing, Joining Seller shall execute and deliver or
cause to be executed and delivered, at any time and from time to time, such
further instruments and documents, and shall do or cause to be done such further
acts, as may be reasonably necessary or proper in the opinion of Buyer to carry
out more effectively the provisions and purposes of this Joinder Agreement and
the Repurchase Agreement.

4. The Existing Sellers and Joining Seller each acknowledge and agree that,
except as modified by this Joinder Agreement, the Repurchase Agreement and each
of the other Transaction Documents remains unmodified and in full force and
effect and all of the terms, covenants and conditions thereof are hereby
ratified and confirmed in all respects.

5. Notwithstanding any provision, covenant, agreement or requirement to the
contrary contained in this Joinder Agreement, the Repurchase Agreement or any
other Transaction Document, Seller shall make commercially reasonable efforts to
amend, restate, or otherwise modify the Custodial Agreement in order to join the
Joining Seller thereto, and for the Joining Seller to enter into a new
(a) servicing agreement with Servicer in substantially the same form as the
applicable Servicing Agreement and (b) blocked account agreement with Servicer
and Depository in substantially the same form as the applicable Blocked Account
Agreement establishing a Cash Management Account with Depository in the manner
required pursuant to Section 5(a) of the Repurchase Agreement.

6. Notice information for Joining Seller for purposes of Section 17 and Annex I
of the Repurchase Agreement and each other applicable Transaction Document shall
be as specified in the signature pages hereto for Joining Seller, or at such
other address and person as shall be designated from time to time in a written
notice to the other parties hereto in the manner provided for in Section 17 of
the Repurchase Agreement.

 

XI-2

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7. THIS JOINDER AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK
WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS PRINCIPLES THEREOF.

8. This Joinder Agreement may be executed in any number of counterparts, and all
such counterparts shall together constitute the same agreement. Signatures
delivered by email (in PDF format) shall be considered binding with the same
force and effect as original signatures.

[Remainder of page intentionally left blank; signatures follow on next page.]

 

XI-3

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IN WITNESS WHEREOF, each of Joining Seller, Exiting Sellers and Buyer has duly
executed and delivered this Joinder Agreement as of the date and year first
above written.

 

JOINING SELLER: [•]   By:  

                     

  Name:   Title: Address for notices to Joining Seller:

[Joining Seller]

c/o Blackstone Mortgage Trust, Inc.

345 Park Avenue

New York, NY 10154 Attention: Douglas Armer Tel: (212) 583-5000 Email:
BXMTCitiRepo@blackstone.com With a copy to:

Ropes & Gray LLP

1211 Avenue of the Americas

New York, New York 10036 Attention: Daniel L. Stanco Tel: (212) 841-5758 Email:
daniel.stanco@ropesgray.com

 

XI-4

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EXISTING SELLERS:

 

PARLEX 2 FINANCE, LLC By:  

 

  Name:   Title: PARLEX 2A FINCO, LLC By:  

 

  Name:   Title: PARLEX 2 UK FINCO, LLC By:  

 

  Name:   Title: PARLEX 2 EUR FINCO, LLC By:  

 

  Name:   Title: PARLEX 2 AU FINCO, LLC By:  

 

  Name:   Title:

 

XI-5

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BUYER:

 

CITIBANK, N.A.

By:  

 

  Name:   Title:

 

XI-6

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EXHIBIT XII

FORM OF FACILITY ASSET CHART

 

 

XII-1