Exhibit 10.5

Execution Copy

FOURTH AMENDED AND RESTATED GUARANTEE AGREEMENT

FOURTH AMENDED AND RESTATED GUARANTEE AGREEMENT, dated as of June 28, 2007 (as
amended, restated, supplemented, or otherwise modified from time to time, this
“Guarantee”), made by GRAMERCY CAPITAL CORP., a Maryland corporation having its
principal place of business at c/o SL Green Realty Corp., 420 Lexington Avenue,
New York, New York 10170 (the “Parent”) and GKK CAPITAL LP, a Delaware limited
partnership having its principal place of business at c/o SL Green Realty Corp.,
420 Lexington Avenue, New York, New York 10170, GRAMERCY INVESTMENT TRUST, a
Maryland real estate investment trust, and GKK TRADING CORP., a Delaware
corporation (each, a “Guarantor”, and collectively, with Parent, the
“Guarantors”), jointly and severally, in favor of the Buyers referred to below
and WACHOVIA BANK, NATIONAL ASSOCIATION (“WBNA”) and any of its parent,
subsidiary or affiliated companies, as agent for the Buyers (collectively, in
such capacity, the “Agent”).

RECITALS

In connection with that certain Third Amended and Restated Master Repurchase
Agreement, dated as of October 13, 2006 (as heretofore amended or otherwise
modified, the “Existing Repurchase Agreement”), between WBNA, as buyer, and
Gramercy Warehouse Funding I LLC (“GWF-I”) and GKK Trading Warehouse I LLC (“GKK
Trading”), as sellers, the Guarantors entered into in favor of WBNA that certain
Third Amended and Restated Guarantee Agreement, dated as of even date therewith
(as heretofore amended or otherwise modified, the “Existing Guarantee”).

The Existing Repurchase Agreement is being amended by that certain First
Amendment to Third Amended and Restated Master Repurchase Agreement, of even
date herewith (as amended, and collectively with the Existing Repurchase
Agreement, the “Repurchase Agreement”), by and among GWF-I, GKK Trading, GKK 450
Lex LLC (“GKK 450”) and the additional sellers from time to time parties thereto
(the “Additional Sellers”, together with GWF-I, GKK Trading and GKK 450,
collectively, the “Sellers”, each, a “Seller”), WBNA and the additional buyers
from time to time parties thereto (collectively, the “Buyers”, each, a “Buyer”)
and the Agent, with Wachovia Capital Markets, LLC, as the Sole Lead Arranger.

It is a condition precedent to the effectiveness of the Repurchase Agreement
that each Guarantor shall have executed and delivered this Guarantee in
connection with each of the representations, warranties, covenants, indemnities
(including but not limited to any indemnification for environmental conditions)
and other obligations of (i) the Sellers with respect to the Buyer under each of
the Repurchase Documents and (ii) the Seller that requests any Letter of Credit
issued in accordance with Section 3.07 of the Repurchase Agreement with respect
to the Letter of Credit Issuers (collectively, the “Obligations”).

NOW, THEREFORE, in consideration of the foregoing premises, to induce the Buyer
to enter into the Repurchase Documents and to enter into the transactions
contemplated thereunder, the Guarantors hereby agree with the Agent and the
Buyers, as follows:

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1.             Defined Terms. Unless otherwise defined herein, terms which are
defined in the Repurchase Agreement and used herein are so used as so defined.

(a)           “Capital Expenditures” shall mean, for any period, the product of
(a) $0.15 multiplied times (b) the average number of square feet, during the
period in question, in improvements constituting part of Real Property Assets
owned by the Parent and/or its Consolidated Subsidiaries with respect to which
the Parent and/or its Consolidated Subsidiaries has financial responsibility for
recurring expenditures which are capitalized on the balance sheet of the Parent
in conformity with GAAP, but expressly excluding portions of improvements which
are leased to Persons which are not Consolidated Subsidiaries who have
responsibility for repair, maintenance and/or replacement in accordance with the
applicable lease or otherwise.

(b)           “Consolidated Subsidiaries” shall mean any Subsidiary of Parent,
or any other entity, which is consolidated with Parent in accordance with GAAP
or which is required under GAAP to be consolidated with Parent.

(c)           “Debt Service” shall mean, for any period, the sum of (a) Interest
Expense of the Parent and its Subsidiaries determined on a consolidated basis
for such period, and (b) all regularly scheduled principal payments made with
respect to Indebtedness of the Parent and its Subsidiaries during such period,
other than any balloon, bullet, margin or similar principal payment which repays
such Indebtedness in full. Debt Service shall include a proportionate share of
items (a) and (b) of all Unconsolidated Affiliates.

(d)           “FAS 140” shall mean Statement No. 140 of the Financial Accounting
Standards Board.

(e)           “Fixed Charge Coverage Ratio” shall mean, for any Person during
any period, the Consolidated Adjusted EBITDA for such period (after adding back
all applicable Incentive Fees), divided by the Fixed Charges for the same
period.

(f)            “Fixed Charges” shall mean, for any Person during any period, the
sum of (a) Debt Service, (b) all Preferred Dividends, (c) Capitalized Lease
Obligations paid or accrued during such period, (d) Capital Expenditures (if
any), and (e) any amounts payable under any Ground Lease. Fixed Charges shall
include a proportionate share of items (a), (b), (c), (d) and (e) of all
Unconsolidated Affiliates.

(g)           “Incentive Fees” shall mean the payments due to the Holders of
Class B Units pursuant to the terms of the version of Section 5.01C of the
Agreement of Limited Partnership of GKK Capital LP dated August 2, 2004 that is
in effect on June 28, 2007.

(h)           “Interest Expense” consists of any Person’s total interest expense
incurred (in accordance with GAAP), including capitalized or accruing interest
(but excluding interest funded under a construction loan), on a consolidated
basis plus the Person’s pro rata share of Interest Expense from Joint Venture
Investments and Unconsolidated Affiliates, without duplication for the most
recent period.

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(i)               “Letter of Credit” shall mean any letter of credit issued
pursuant to Section 3.07 of the Repurchase Agreement.

(j)                “QSPE” shall mean a qualified special purpose entity for
purposes of FAS 140.

(k)              “Real Property Assets” shall mean, as of any time, the real
property assets (including interests in preferred equity and participating
mortgages in which the lender’s interest therein is characterized as equity
according to GAAP) owned directly or indirectly by the Guarantors or a
Consolidated Subsidiary at such time.

(l)               “Special Dividend Distributions” shall mean any cash
distributions, to the extent necessary to eliminate taxes pursuant to Sections
857(b)(3) and 4981 of the Internal Revenue Code.

(m)             “Tangible Net Worth” shall mean, as of a particular date and
calculated on a consolidated basis: (1) all amounts which would be included
under capital (or any like caption) on a consolidated balance sheet of any
Person(s) at such date, determined in accordance with GAAP, less (2) (i) amounts
owing to such Person(s) from any Affiliates thereof, or from officers,
employees, partners, members, directors, shareholders or other Persons similarly
affiliated with such Person(s) or their respective Affiliates, (ii) intangible
assets (other than Interest Rate Protection Agreements specifically related to
the Purchased Assets), (iii) prepaid taxes and/or expenses and (iv) the value of
any Purchased Asset which, after its Closing Date, becomes an REO Property.

(n)              “Total Assets”: At any time, an amount equal to the aggregate
book value of all assets owned by any Person(s), determined on a
non-consolidated basis.

(o)              “Total Indebtedness”: At any time, without duplication, all
Indebtedness and Contingent Liabilities of any Person and all Subsidiaries
thereof, determined on a non-consolidated basis.

(p)              “Total Liabilities Ratio”: As to any Person, the ratio of (a)
the Total Indebtedness of such Person to (b) the Total Assets of such Person.

(q)              “Trust Preferred Securities” shall mean instruments that
entitle the holders thereof to receive payments that depend (except for rights
or other assets designed to assure the servicing or timely distribution of
proceeds to holders thereof) on the cash flow from the pool of trust securities
issued by a wholly-owned subsidiary of a U.S. financial institution or an
insurance holding company which uses the proceeds of such issuance to purchase a
portfolio of debt securities issued by its parent. They generally have the
following characteristics: (i) the trust securities are non-amortizing preferred
stock securities; (ii) the trust securities have a 30-year maturity with a 5- or
10-year non-call period; and (iii) the trust securities are subordinated debt.

2.              Guarantee.   (a)   Each Guarantor hereby unconditionally and
irrevocably guarantees to the Agent and the Buyers the prompt and complete
payment and performance by

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each Seller when due (whether at the stated maturity, by acceleration or
otherwise) of the Obligations.

(a)            (i) Subject to clause (b)(ii) below, the maximum liability the
Guarantors hereunder and under the Repurchase Documents shall in no event exceed
10% of the greater of (i) the outstanding aggregate Purchase Price under the
Repurchase Agreement and the (ii) total capitalization (including all debt and
equity capitalization) of the Sellers.

(ii)           With respect to any Obligations arising under or related to any
Letter of Credit, the limitation of the maximum liability of the Guarantors
pursuant to clause (i) above shall be of no force and effect.

(c)           Notwithstanding the foregoing, the limitation on recourse
liability as set forth in subsection (b) above SHALL BECOME NULL AND VOID and
shall be of no further force and effect and the Obligations immediately shall
become fully recourse to the Sellers and Guarantors, jointly and severally, in
the event of any of the following:

(i)            a voluntary bankruptcy or insolvency proceeding is commenced by
any Seller under the U.S. Bankruptcy Code or any similar federal or state law;

(ii)           an involuntary bankruptcy or insolvency proceeding is commenced
against any Seller or either Guarantor in connection with which any Seller,
either Guarantor, or any Affiliate of any of the foregoing has or have colluded
in any way with the creditors commencing or filing such proceeding;

(iii)          fraud or intentional misrepresentation by any Seller, either
Guarantor or any other Affiliate of any Seller or either Guarantor in connection
with the execution and the delivery of this Guarantee, the Repurchase Agreement,
or any of the other Repurchase Documents, or any certificate, report, financial
statement or other instrument or document furnished to the Agent or any Buyer at
the time of the closing of the Repurchase Agreement or during the term of the
Repurchase Agreement;

(iv)          any material breach of the separateness covenants contained in the
Repurchase Agreement;

(v)           any material breach of any representations and warranties
contained in any Repurchase Document including but not limited to any
representations and warranties relating to Environmental Matters, or any
indemnity for costs incurred in connection with the violation of any
Environmental Law, the correction of any environmental condition, or the removal
of any Materials of Environmental Concern, in each case in any way affecting any
Seller’s or any of its Affiliates’ properties or any of the Mortgage Assets; or

(vi)          Parent at any time fails to maintain its status as a REIT.

(d)            In addition to the foregoing and notwithstanding the limitation
on recourse liability set forth in subsection (b), Guarantors shall be jointly
and severally liable for any losses, costs, claims, expenses or other
liabilities incurred by the Agent or any Buyer arising out of or attributable to
nonmaterial breaches of the items listed in (c)(iv) and (c)(v) above.

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(e)                   Nothing herein shall be deemed to be a waiver of any right
which the Agent or any Buyer may have under Section 506(a), 506(b), 1111(b) or
any other provision of the U.S. Bankruptcy Code to file a claim for the full
amount of the indebtedness secured by the Repurchase Agreement or to require
that all collateral shall continue to secure all of the indebtedness owing to
the Buyers and the Agent in accordance with the Repurchase Agreement or any
other Repurchase Documents.

(f)            Each Guarantor further agrees to pay any and all reasonable
expenses (including, without limitation, all reasonable fees and disbursements
of counsel) which may be paid or incurred by the Agent and any Buyer in
enforcing, or obtaining advice of counsel in respect of, any rights with respect
to, or collecting, any or all of the Obligations and/or enforcing any rights
with respect to, or collecting against, either Guarantor under this Guarantee.
This Guarantee shall remain in full force and effect until the Obligations are
paid in full, notwithstanding that from time to time prior thereto the Sellers
may be free from any Obligations.

(g)                  No payment or payments made by any Seller or any other
Person or received or collected by the Agent or any Buyer from any Seller or any
other Person by virtue of any action or proceeding or any set-off or
appropriation or application, at any time or from time to time, in reduction of
or in payment of the Obligations shall be deemed to modify, reduce, release or
otherwise affect the liability of the Guarantors hereunder which shall,
notwithstanding any such payment or payments, remain liable for the amount of
the Obligations until the Obligations are paid in full.

(h)           Each Guarantor agrees that whenever, at any time, or from time to
time, either Guarantor shall make any payment to the Agent for the ratable
benefit of the Buyers on account of such Guarantor’s liability hereunder, such
Guarantor will notify the Agent in writing that such payment is made under this
Guarantee for such purpose.

3.                     Subrogation. Upon making any payment hereunder,
Guarantors shall be subrogated to the rights of the Agent and the Buyers against
Sellers and any collateral for any Obligations with respect to such payment;
provided that Guarantors shall not seek to enforce any right or receive any
payment by way of subrogation until all amounts due and payable by Sellers to
the Agent or any Buyer under the Repurchase Documents or any related documents
have been paid in full; and further provided that such subrogation rights shall
be subordinate in all respects to all amounts owing to the Buyers and the Agent
under the Repurchase Documents.

4.                     Amendments, etc. with Respect to the Obligations. Each
Guarantor shall remain obligated hereunder notwithstanding that, without any
reservation of rights against such Guarantor, and without notice to or further
assent by such Guarantor, any demand for payment of any of the Obligations made
by the Agent for the benefit of the Buyers may be rescinded by the Agent on
behalf of the Buyers and any of the Obligations continued, and the Obligations,
or the liability of any other party upon or for any part thereof, or any
collateral security or guarantee therefor or right of offset with respect
thereto, may, from time to time, in whole or in part, be renewed, extended,
amended, modified, accelerated, compromised, waived, surrendered or released by
the Agent on behalf of the Buyers, and any Repurchase Document and any other
document in connection therewith may be amended, modified, supplemented or
terminated, in

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whole or in part, as the Agent may deem advisable from time to time, and any
collateral security, guarantee or right of offset at any time held by the Agent
for the benefit of the Buyers for the payment of the Obligations may be sold,
exchanged, waived, surrendered or released. The Agent shall have no obligation
to protect, secure, perfect or insure any lien at any time held by it as
security for the Obligations or for this Guarantee or any property subject
thereto. When making any demand hereunder against Guarantors, the Agent may, but
shall be under no obligation to, make a similar demand on any Seller or any
other guarantor, and any failure by the Agent to make any such demand or to
collect any payments from any Seller or any such other guarantor or any release
of any Seller or such other guarantor shall not relieve either Guarantor of its
Obligations or liabilities hereunder, and shall not impair or affect the rights
and remedies, express or implied, or as a matter of law, of the Agent against
either Guarantor. For the purposes hereof “demand” shall include the
commencement and continuance of any legal proceedings.

5.             Guarantee Absolute and Unconditional. (a)   Each Guarantor hereby
agrees that its obligations under this Guarantee constitute a guarantee of
payment when due and not of collection. Guarantors waive any and all notice of
the creation, renewal, extension or accrual of any of the Obligations and notice
of or proof of reliance by the Agent or the Buyers upon this Guarantee or
acceptance of this Guarantee; the Obligations, and any of them, shall
conclusively be deemed to have been created, contracted or incurred in reliance
upon this Guarantee; and all dealings between any Seller or either Guarantor, on
the one hand, and the Agent or any Buyer, on the other hand, shall likewise be
conclusively presumed to have been had or consummated in reliance upon this
Guarantee. Each Guarantor waives promptness, diligence, presentment, protest,
demand for payment and notice of default or nonpayment to or upon the Sellers or
the Guarantee with respect to the Obligations. This Guarantee shall be construed
as a continuing, absolute and unconditional guarantee of payment without regard
to (i) the validity, regularity or enforceability of any Agreement, any of the
Obligations or any collateral security therefor or guarantee or right of offset
with respect thereto at any time or from time to time held by the Agent or any
Buyer, (ii) any defense, set-off or counterclaim (other than a defense of
payment or performance) which may at any time be available to or be asserted by
any Seller against the Agent or any Buyer, (iii) any requirement that the Agent
or any Buyer exhaust any right to take any action against any Seller or any
other Person prior to or contemporaneously with proceeding to exercise any right
against Guarantors under this Guarantee or (iv) any other circumstance
whatsoever (with or without notice to or knowledge of the Sellers or the
Guarantors) which constitutes, or might be construed to constitute, an equitable
or legal discharge of the Sellers for the Obligations or of the Guarantors under
this Guarantee, in bankruptcy or in any other instance. When pursuing its rights
and remedies hereunder against the Guarantor, the Agent may, but shall be under
no obligation, to pursue such rights and remedies that the Agent or the Buyers
may have against the Sellers or any other Person or against any collateral
security or guarantee for the Obligations or any right of offset with respect
thereto, and any failure by the Agent to pursue such other rights or remedies or
to collect any payments from the Sellers or any such other Person or to realize
upon any such collateral security or guarantee or to exercise any such right of
offset, or any release of any Seller or any such other Person or any such
collateral security, guarantee or right of offset, shall not relieve either
Guarantor of any liability hereunder, and shall not impair or affect the rights
and remedies, whether express, implied or available as a matter of law, of the
Agent or any Buyer against either Guarantor. This Guarantee shall remain in full
force and effect and be binding in accordance with and to the extent of its
terms upon each Guarantor and its respective successors and assigns

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thereof, and shall inure to the benefit of the Agent and the Buyers, and their
respective successors, endorsees, transferees and assigns, until all the
Obligations and the obligations of each Guarantor under this Guarantee shall
have been satisfied by payment in full, notwithstanding that from time to time
during the term of the Repurchase Documents any Seller may be free from any
Obligations.

(a)           Without limiting the generality of the foregoing, each Guarantor
hereby agrees, acknowledges, and represents and warrants to the Agent and the
Buyers as follows:

(i)            Each Guarantor hereby waives any defense arising by reason of,
and any and all right to assert against the Agent or any Buyer any claim or
defense based upon, an election of remedies by the Agent or any Buyer which in
any manner impairs, affects, reduces, releases, destroys and/or extinguishes
such Guarantor’s subrogation rights, rights to proceed against the Sellers, or
any other guarantor for reimbursement or contribution, and/or any other rights
of such Guarantor to proceed against the Sellers against any other guarantor, or
against any other person or security.

(ii)           Each Guarantor is presently informed of the financial condition
of the Sellers and of all other circumstances which diligent inquiry would
reveal and which bear upon the risk of nonpayment of the Obligations. Each
Guarantor hereby covenants that it will make its own investigation and will
continue to keep itself informed about each of the Seller’s financial condition,
the status of other guarantors, if any, of all other circumstances which bear
upon the risk of nonpayment and that it will continue to rely upon sources other
than the Agent and the Buyers for such information and will not rely upon the
Agent or any Buyer for any such information. Absent a written request for such
information by either Guarantor to the Agent, each Guarantor hereby waives the
right, if any, to require the Agent to disclose to the Guarantor any information
which the Agent may now or hereafter acquire concerning such condition or
circumstances including, but not limited to, the release of or revocation by any
other guarantor.

(iii)          Each Guarantor has independently reviewed the Repurchase
Documents and related agreements and has made an independent determination as to
the validity and enforceability thereof, and in executing and delivering this
Guarantee to the Agent, such Guarantor is not in any manner relying upon the
validity, and/or enforceability, and/or attachment, and/or perfection of any
liens or security interests of any kind or nature granted by the Sellers or any
other guarantor to the Agent or any Buyer, now or at any time and from time to
time in the future.

6.             Reinstatement. This Guarantee shall continue to be effective, or
be reinstated, as the case may be, if at any time payment, or any part thereof,
of any of the Obligations is rescinded or must otherwise be restored or returned
by the Agent or any Buyer upon the insolvency, bankruptcy, dissolution,
liquidation or reorganization of any Seller or upon or as a result of the
appointment of a receiver, intervenor or conservator of, or trustee or similar
officer for, any of the Sellers or any substantial part of any Seller’s
property, or otherwise, all as though such payments had not been made.

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7.                     Payments. Each Guarantor hereby agrees that the
Obligations will be paid to the Agent for the ratable benefit of the Buyers
without set-off or counterclaim in U.S. Dollars at the address specified in
writing by the Agent.

8.                     Representations and Warranties. Each Guarantor represents
and warrants that:

(a)           the Guarantor has the legal capacity and the legal right to
execute and deliver this Guarantee and to perform the Guarantor’s obligations
hereunder;

(b)           no consent or authorization of, filing with, or other act by or in
respect of, any arbitrator or governmental authority and no consent of any other
Person (including, without limitation, any creditor of the Guarantor) is
required in connection with the execution, delivery, performance, validity or
enforceability of this Guarantee;

(c)           this Guarantee has been duly executed and delivered by the
Guarantor and constitutes a legal, valid and binding obligation of the Guarantor
enforceable in accordance with its terms, except as enforceability may be
limited by bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting the enforcement of creditors’ rights generally and by general
principles of equity (whether enforcement is sought in proceedings in equity or
at law);

(d)           the execution, delivery and performance of this Guarantee will not
violate any law, treaty, rule or regulation or determination of an arbitrator, a
court or other governmental authority, applicable to or binding upon the
Guarantor or any of its property or to which the Guarantor or any of its
property is subject (“Requirement of Law”), or any provision of any security
issued by the Guarantor or of any agreement, instrument or other undertaking to
which the Guarantor is a party or by which it or any of its property is bound
(“Contractual Obligation”), and will not result in or require the creation or
imposition of any lien on any of the properties or revenues of the Guarantor
pursuant to any Requirement of Law or Contractual Obligation of the Guarantor;

(e)           no litigation, investigation or proceeding of or before any
arbitrator or Governmental Authority is pending or, to the knowledge of the
Guarantor, threatened by or against the Guarantor or against any of the
Guarantor’s properties or revenues with respect to this Guarantee or any of the
transactions contemplated hereby; and

(f)            except as disclosed in writing to the Agent prior to the date
hereof, the Guarantor has filed or caused to be filed all tax returns which, to
the knowledge of the Guarantor, are required to be filed and has paid all taxes
shown to be due and payable on said returns or on any assessments made against
him or any of the Guarantor’s property and all other taxes, fees or other
charges imposed on him or any of the Guarantor’s property by any Governmental
Authority (other than any the amount or validity of which are currently being
contested in good faith by appropriate proceedings); no tax lien has been filed,
and, to the knowledge of the Guarantor, no claim is being asserted, with respect
to any such tax, fee or other charge.

Each Guarantor agrees that the foregoing representations and warranties shall be
deemed to have been made by such Guarantor on the date of each Transaction under
the

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Repurchase Agreement, on and as of such date of the Transaction, as though made
hereunder on and as of such date.

9.             Covenants.

(a)           Financial Statements. (i) As soon as available and in any event
within forty-five (45) days after the end of each fiscal quarter of each
Guarantor, each Guarantor shall deliver to the Agent and each Buyer the
unaudited consolidated balance sheets of such Guarantor and its consolidated
Subsidiaries (and, to the extent available, for each Seller) as at the end of
such period and the related unaudited consolidated statements of income and
retained earnings and of cash flows for such Guarantor and its consolidated
Subsidiaries (and, to the extent available, for each Seller) for such period and
the portion of the fiscal year through the end of such period, accompanied by a
schedule of all contingent funding obligations and hedging positions of the
Parent and its Consolidated Subsidiaries (and, to the extent available, for each
Seller) and a certificate of a Responsible Officer, which certificate shall
state that said consolidated financial statements fairly present in all material
respects the consolidated financial condition and results of operations of the
Parent and its consolidated Subsidiaries (and, to the extent applicable, for
each Seller) in accordance with GAAP, consistently applied, as at the end of,
and for, such period (subject to normal year-end adjustments); provided, that
the Agent and any Buyer may disclose such financial statements, if required, to
its regulators, or as otherwise required by law.

(ii)           As soon as available and in any event within ninety (90) days
after the end of each fiscal year of each Guarantor, each Guarantor shall
deliver to the Agent and each Buyer the audited consolidated balance sheets of
such Guarantor and its consolidated Subsidiaries (and, to the extent available,
for each Seller) as at the end of such fiscal year and the related consolidated
statements of income and retained earnings and of cash flows for such Guarantor
and its consolidated Subsidiaries (and, to the extent available, for each
Seller) for such year, setting forth in each case in comparative form the
figures for the previous year, accompanied by an opinion thereon of independent
certified public accountants of recognized national standing, which opinion
shall not be qualified as to scope of audit or going concern and shall state
that said consolidated financial statements fairly present the consolidated
financial condition and results of operations of each Guarantor and its
consolidated Subsidiaries (and, to the extent applicable, for each Seller) as at
the end of, and for, such fiscal year in accordance with GAAP, and a certificate
of such accountants stating that, in making the examination necessary for their
opinion, they obtained no knowledge, except as specifically stated, of any
Default or Event of Default.

(iii)          Each Guarantor covenants and agrees that such Guarantor will not
change its legal name or primary place of business without having provided to
the Agent 30 day’s prior written notice of any such change.

(iv)          Each Guarantor covenants and agrees that it shall deliver to the
Agent and each Buyer, within forty-five (45) days of after the end of each
fiscal quarter, a statement of compliance accompanied by a certificate of a
responsible officer, in the form attached hereto as Exhibit A, (A) stating that
each of the representations, warranties and covenants contained herein have been
complied with and (B) attaching a current copy of such Guarantor’s
organizational

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chart (depicting and delineating all of such Guarantor’s consolidated and
non-consolidated Subsidiaries).

(b)           Limitation on Distributions. Parent shall not declare or make any
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 equity or partnership interest of Parent, 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 Parent, except,
so long as no Default, Event of Default or Margin Deficit shall have occurred
and be continuing, Parent may make (i) such payments solely to the extent
necessary to preserve its status as a REIT, (ii) quarterly dividend
distributions in an amount up to 100% of its FFO for the immediately preceding
fiscal quarter, (iii) an annual dividend distribution, so long as the total
amount thereof, when combined with the previous four (4) quarterly dividend
distributions described herein does not exceed an amount equal to one hundred
percent (100%) of Parent’s consolidated FFO for the immediately preceding four
(4) fiscal quarters and (iv) Special Dividend Distributions and Parent may, also
so long as no Default, Event of Default or Margin Deficit shall have occurred
and be continuing, make cash distributions to its shareholders to the extent
necessary to (A) avoid the payment by Parent of taxes imposed under Sections
857(b)(1) and 4981 of the Code and (B) allow its shareholders to pay any taxes
imposed on them under Sections 857(b)(3), (4), (5), (6) or (7) of the Code.
Nothwithstanding the foregoing restrictions, nothing in this Section 9(b) shall
limit the ability of any Guarantor to effect a buy back of its Capital Stock
pursuant to Section 9(k).

(c)           Minimum Interest Coverage Ratio. At no time during any Test Period
shall the ratio of (i) the sum of Consolidated Adjusted EBITDA of the Guarantors
(calculated on an aggregate basis after adding back all applicable Incentive
Fees) to (ii) Consolidated Interest Expense of the Guarantors (calculated on an
aggregate basis) be less than 1.35 to 1.00.

(d)                  Maintenance of Ratio of Consolidated Total Indebtedness to
Consolidated Total Assets. At no time shall the ratio of the Consolidated Total
Indebtedness of the Guarantors (calculated on an aggregate basis after including
each Guarantor’s pro-rata share of the Indebtedness and Contingent Liabilities
of any off balance sheet securitization vehicles in which each such Guarantor or
any of their respective Subsidiaries, Affiliates or Unconsolidated Affiliates
own equity, other than any Unconsolidated Affiliates that are securitization
vehicles which qualify as QSPEs) to the Consolidated Total Assets of the
Guarantors (calculated on an aggregate basis after including each Guarantor’s
pro-rata share of the then-current fair market value of each Guarantor’s
interests in any of the assets of any off balance sheet securitization vehicles
in which each such Guarantor or any of their respective Subsidiaries, Affiliates
or Unconsolidated Affiliates own equity, other than any Unconsolidated
Affiliates that are securitization vehicles which qualify as QSPEs) be greater
than 0.90 to 1.00.

(e)           Positive Net Income. The consolidated Net Income of the Guarantors
(calculated on an aggregate basis) shall at all times be equal to a positive
amount.

(f)            Maximum Total Liabilities Ratio. At no time shall the Total
Liabilities Ratio of the Guarantors (calculated on an aggregate basis after
deducting the total amount of all

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Trust Preferred Securities from the Total Indebtedness of the Guarantors) be
greater than .85 to 1.00.

(g)           Minimum Liquidity Requirement. The Liquidity of the Guarantors
(calculated on an aggregate basis) shall at no time be less than $15,000,000.

(h)           Fixed Charge Coverage Ratio. At no time shall the consolidated
Fixed Charge Coverage Ratio of the Guarantors (calculated on an aggregate basis)
be less than 1.25 to 1.00.

(i)            Minimum Tangible Net Worth. At no time shall the Tangible Net
Worth of the Guarantors (calculated on an aggregate basis) be less than the sum
of (x) $400,000,000, and (y) seventy-five percent (75%) of the net proceeds from
the issuance by any Guarantor or any Subsidiary thereof of any of any Capital
Stock of any class (whether in a public offering or a private placement)
subsequent to the date of this Guarantee.

(j)            Prohibition on Additional Indebtedness. No Guarantor shall at any
time incur any Indebtedness in excess of the sum of: (i) $300,000,000 with
respect to future funding obligations under Mortgage Assets acquired by the
Sellers, which future funding obligations shall exclude (A) all amounts
committed for future fundings under either the Repurchase Agreement or the
Amended and Restated Master Repurchase Agreement (dated as of October 13, 2006)
between Goldman Sachs Mortgage Company, Gramercy Warehouse Funding II LLC and
GKK Trading Warehouse II, LLC, net of any equity portions thereof which must be
funded by any Guarantor or any Affiliates or Subsidiaries of any Guarantor, and
(B) the amount of all such future funding obligations that are then-currently
and exclusively allocated or budgeted by any Guarantor or any Affiliate or
Subsidiary of any Guarantor, either as interest reserves or for the acquisition
of additional Eligible Assets, in either case also net of any equity portions
thereof which must be funded by any Guarantor or any Affiliates or Subsidiaries
of any Guarantor, (ii) such Guarantor’s obligations under this Agreement, (iii)
customary and standard trade payables incurred by such Guarantor in the ordinary
course of business, provided that (A) the aggregate amount of any such
outstanding trade payables shall at no time exceed $500,000, and (B) any such
trade payable amounts shall be paid by such Guarantor within sixty (60) days of
when they were incurred, (iv) fees payable under the Management Contract as in
effect on the date hereof, (v) similar guarantee obligations with respect to
other credit or repurchase facilities which provide financing for other
Subsidiaries or Affiliates of such Guarantor (other than Sellers under the
documents related to any of the transactions contemplated by the Repurchase
Agreement), but only if such guarantee obligations are pari passu in class and
right with the obligations to Buyer under the Repurchase Agreement, and only if
Buyer receives a Non-Consolidation Opinion with respect to such obligations and
(vi) the then-current outstanding balance of all unpaid obligations of any
Guarantor under that certain First Amended and Restated Credit Agreement dated
as of June 28, 2007, among GKK Capital LP, as borrower, Keybank National
Association, as agent, the banks party thereto and Keybanc Capital Markets, as
sole lead manager and arranger, but in no event shall the total amount of all
obligations outstanding under such credit agreement exceed an amount equal to
$225,000,000.

(k)           Buy Back of Capital Stock. No Guarantor shall be permitted to buy
back any of its Capital Stock while this Guarantee remains in effect unless (1)
no Margin Deficit,

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Default or Event of Default exists under the Repurchase Agreement and (2)
Sellers and each Guarantor shall continuously (and immediately thereafter) meet
all covenants, conditions, representations and warranties, whether financial or
otherwise, as set forth in any of the Repurchase Documents.

(l)            REIT Status. The Parent shall at all times continue to be (i)
qualified as a real estate investment trust as defined in Section 856 of the
Code, (ii) entitled to a dividends paid deduction under Section 857 of the code
with respect to dividends paid by it with respect to each taxable year for which
it claims a deduction on its FORM 1120-REIT filed with the United States
Internal Revenue Service for such year.

(m)          Publicly Traded Company. The Parent shall at all times be a
publicly traded company listed, quoted or traded on the New York Stock Exchange,
NASDAQ or any such other nationally recognized stock exchange.

(n)           Interest Rate Protection Agreements. Each Guarantor which is from
time to time party to any Interest Rate Protection Agreement related to any
Purchased Asset shall make, or cause to be made, all payments from time to time
due and payable by such Guarantor under such Interest Rate Protection Agreement
directly into the Collection Account as contemplated under Section 5.01 of the
Repurchase Agreement.

(o)           Internalization of Management. Parent shall not internalize the
management of Parent without the prior written consent of the Agent; provided,
however, that such consent shall be granted by the Agent so long as (1) no
Margin Deficit, Default or Event of Default exists under the Repurchase
Agreement, (2) Sellers shall, at the time of such internalization, and Parent
shall cause Sellers to continue after such internalization to meet all
covenants, conditions, representations and warranties, whether financial or
otherwise, as set forth in any of the Repurchase Documents, and (3) Parent shall
deliver to the Agent a fairness opinion, in form and substance acceptable to the
Agent, provided by a nationally recognized expert in the related field
acceptable to the Agent.

10.                  Severability. Any provision of this Guarantee which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

11.                  Paragraph Headings. The paragraph headings used in this
Guarantee are for convenience of reference only and are not to affect the
construction hereof or be taken into consideration in the interpretation hereof.

12.                  No Waiver; Cumulative Remedies. The Agent shall not by any
act (except by a written instrument pursuant to paragraph 14 hereof), delay,
indulgence, omission or otherwise be deemed to have waived any right or remedy
hereunder or to have acquiesced in any default or event of default or in any
breach of any of the terms and conditions hereof. No failure to exercise, nor
any delay in exercising, on the part of the Agent, any right, power or privilege
hereunder shall operate as a waiver thereof. No single or partial exercise of
any right, power or

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privilege hereunder shall preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. A waiver by the Agent of any
right or remedy hereunder on any one occasion shall not be construed as a bar to
any right or remedy which the Agent would otherwise have on any future occasion.
The rights and remedies herein provided are cumulative, may be exercised singly
or concurrently and are not exclusive of any rights or remedies provided by law.

13.                  Waivers and Amendments; Successors and Assigns; Governing
Law. None of the terms or provisions of this Guarantee may be waived, amended,
supplemented or otherwise modified except by a written instrument executed by
each Guarantor and the Agent, provided that, subject to any limitations set
forth in the Repurchase Agreement, any provision of this Guarantee may be waived
by the Agent in a letter or agreement executed by the Agent or by telex or
facsimile transmission from the Agent. This Guarantee shall be binding upon the
heirs, personal representatives, successors and assigns of the Guarantors and
shall inure to the benefit of the Agent and the Buyers, and their respective
successors and assigns. THIS GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

14.                  Notices. Notices by the Agent to any Guarantor may be given
by mail, or by telecopy transmission, addressed to such Guarantor at the address
or transmission number set forth under its signature below and shall be
effective (a) in the case of mail, five days after deposit in the postal system,
first class certified mail and postage pre-paid, (b) one Business Day following
timely delivery to a nationally recognized overnight courier service for next
Business Day delivery and (c) in the case of telecopy transmissions, when sent,
transmission electronically confirmed.

15.                  SUBMISSION TO JURISDICTION; WAIVERS. EACH GUARANTOR HEREBY
IRREVOCABLY AND UNCONDITIONALLY:

(A)                  SUBMITS FOR THE GUARANTOR AND THE GUARANTOR’S PROPERTY IN
ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS GUARANTEE AND THE OTHER LOAN
DOCUMENTS TO WHICH THE GUARANTOR IS A PARTY, OR FOR RECOGNITION AND ENFORCEMENT
OF ANY JUDGMENT IN RESPECT THEREOF, TO THE NON-EXCLUSIVE GENERAL JURISDICTION OF
THE COURTS OF THE STATE OF NEW YORK, THE COURTS OF THE UNITED STATES OF AMERICA
FOR THE SOUTHERN DISTRICT OF NEW YORK, AND APPELLATE COURTS FROM ANY THEREOF;

(B)                   CONSENTS THAT ANY SUCH ACTION OR PROCEEDING MAY BE BROUGHT
IN SUCH COURTS AND WAIVES ANY OBJECTION THAT THE GUARANTOR MAY NOW OR HEREAFTER
HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT
SUCH ACTION OR PROCEEDING WAS BROUGHT IN AN INCONVENIENT COURT AND AGREES NOT TO
PLEAD OR CLAIM THE SAME;

(C)                   AGREES THAT SERVICE OF PROCESS IN ANY SUCH ACTION OR
PROCEEDING MAY BE EFFECTED BY MAILING A COPY THEREOF BY REGISTERED

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OR CERTIFIED MAIL (OR ANY SUBSTANTIALLY SIMILAR FORM OF MAIL), POSTAGE PREPAID,
TO THE GUARANTOR AT THE GUARANTOR’S ADDRESS SET FORTH UNDER THE GUARANTOR’S
SIGNATURE BELOW OR AT SUCH OTHER ADDRESS OF WHICH THE BUYER SHALL HAVE BEEN
NOTIFIED; AND

(D)                   AGREES THAT NOTHING HEREIN SHALL AFFECT THE RIGHT TO
EFFECT SERVICE OF PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT
THE RIGHT TO SUE IN ANY OTHER JURISDICTION.

16.                  Integration. This Guarantee represents the agreement of
each Guarantor with respect to the subject matter hereof and there are no
promises or representations by the Agent or any Buyer relative to the subject
matter hereof not reflected herein.

17.                  Acknowledgments. Each Guarantor hereby acknowledges that:

(a)                  Guarantor has been advised by counsel in the negotiation,
execution and delivery of this Guarantee and the related documents;

(b)                  neither the Agent nor any Buyer has any fiduciary
relationship to Guarantor, and the relationship between the Agent and the Buyers
and Guarantor is solely that of surety and creditor; and

(c)                  no joint venture exists between or among any of the Agent,
the Buyers, the Guarantors and the Sellers.

18.                  Amendment and Restatement. The Existing Guarantee is
amended, restated and superseded in its entirety by this Guarantee. Each
Guarantor confirms and agrees that it has no, and it hereby waives all,
defenses, rights of setoff, claims, counterclaims or causes of action of any
kind or description against the Agent and the Buyers arising under or in respect
of the Existing Guarantee or any related document and each Guarantor hereby
confirms, as of the date hereof, that each of the Agent and the Buyers is in
full compliance with all of its undertakings and obligations under the
Repurchase Documents.

19.                  WAIVERS OF JURY TRIAL. EACH OF THE GUARANTORS AND THE AGENT
HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION
OR PROCEEDING RELATING TO THIS GUARANTEE OR ANY RELATED DOCUMENT AND FOR ANY
COUNTERCLAIM HEREIN OR THEREIN.

[SIGNATURES COMMENCE ON THE FOLLOWING PAGE]

A-14

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IN WITNESS WHEREOF, the undersigned has caused this Guarantee Agreement to be
duly executed and delivered as of the date first above written.

 

GRAMERCY CAPITAL CORP., a Maryland
Corporation

 

 

 

 

 

By:

 

 

 

 

Name: Hugh Hall

 

 

Title: Chief Operating Officer

 

 

 

Address for Notices:

 

 

 

420 Lexington Avenue

 

New York, New York  10170

 

Telephone:  (212) 216-1713

 

Telecopy: 

 

Attention: Bob Foley

 

 

 

With a copy to:

 

 

 

Richard Jones

 

Dechert LLP

 

4000 Bell Atlantic Tower, 1717 Arch Street

 

Philadelphia, Pennsylvania 19103-2793

 

Telephone: (215) 994-4000

 

Telecopy: (215) 994-2222

 

 

THE STATE OF NEW YORK

)

 

 

)

 

COUNTY OF NASSAU

)

 

 

Subscribed and sworn before me, a Notary Public in and for the County and State,
this           day of June, in the year 2007.

 

 

 

   NOTARY PUBLIC

 

 

 

 

My Commission Expires:

 

 

 

Signature Page to the Fourth Amended and Restated Guarantee agreement

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

IN WITNESS WHEREOF, the undersigned has caused this Guarantee Agreement to be
duly executed and delivered as of the date first above written.

GKK CAPITAL LP, a Delaware limited

 

partnership

 

 

 

By:

GRAMERCY CAPITAL CORP., a
Maryland corporation, its general
partner

 

 

 

 

 

 

 

 

 

By:

 

 

 

 

 

Name:  Hugh Hall

 

 

 

 

Title:  Chief Operating Officer

 

 

 

 

Address for Notices:

 

 

 

420 Lexington Avenue

 

New York, New York  10170

 

Telephone:  (212) 216-1713

 

Telecopy: 

 

Attention: Bob Foley

 

 

 

With a copy to:

 

 

 

Richard Jones

 

Dechert LLP

 

4000 Bell Atlantic Tower, 1717 Arch Street

 

Philadelphia, Pennsylvania 19103-2793

 

Telephone: (215) 994-4000

 

Telecopy: (215) 994-2222

 

 

 

 

THE STATE OF NEW YORK

)

 

 

)

 

COUNTY OF NASSAU

)

 

 

Subscribed and sworn before me, a Notary Public in and for the County and State,
this           day of June, in the year 2007.

 

 

 

    NOTARY PUBLIC

 

 

 

My Commission Expires:

 

 

 

Signature Page to the Fourth Amended and Restated Guarantee agreement

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

IN WITNESS WHEREOF, the undersigned has caused this Guarantee Agreement to be
duly executed and delivered as of the date first above written.

GRAMERCY INVESTMENT TRUST, a
Maryland real estate investment trust

 

 

 

 

 

By:

GKK CAPITAL LP, a Delaware limited
partnership

 

 

 

 

 

 

 

 

 

 

By:

GRAMERCY CAPITAL CORP., a
Maryland corporation, its general
partner

 

 

 

 

 

 

 

 

 

 

 

 

 

 

By:

 

 

 

 

 

 

Name:  Hugh Hall

 

 

 

 

 

Title:  Chief Operating Officer

 

 

 

 

Address for Notices:

 

 

 

420 Lexington Avenue

 

New York, New York  10170

 

Telephone:  (212) 216-1713

 

Telecopy: 

 

Attention: Bob Foley

 

 

 

With a copy to:

 

 

 

Richard Jones

 

Dechert LLP

 

4000 Bell Atlantic Tower, 1717 Arch Street

 

Philadelphia, Pennsylvania 19103-2793

 

Telephone: (215) 994-4000

 

Telecopy: (215) 994-2222

 

 

 

 

THE STATE OF NEW YORK

)

 

 

)

 

COUNTY OF NASSAU

)

 

 

Subscribed and sworn before me, a Notary Public in and for the County and State,
this           day of June, in the year 2007.

 

 

 

    NOTARY PUBLIC

 

 

 

My Commission Expires:

 

 

 

Signature Page to the Fourth Amended and Restated Guarantee agreement

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

IN WITNESS WHEREOF, the undersigned has caused this Guarantee Agreement to be
duly executed and delivered as of the date first above written.

GKK TRADING CORP., a Delaware

 

corporation

 

 

 

By:

GRAMERCY CAPITAL CORP., a
Maryland corporation, its general partner

 

 

 

 

 

 

 

 

 

By:

 

 

 

 

 

Name:  Hugh Hall

 

 

 

 

Title:  Chief Operating Officer

 

 

 

 

Address for Notices:

 

 

 

420 Lexington Avenue

 

New York, New York  10170

 

Telephone:  (212) 216-1713

 

Telecopy: 

 

Attention: Bob Foley

 

 

 

With a copy to:

 

 

 

Richard Jones

 

Dechert LLP

 

4000 Bell Atlantic Tower, 1717 Arch Street

 

Philadelphia, Pennsylvania 19103-2793

 

Telephone: (215) 994-4000

 

Telecopy: (215) 994-2222

 

 

 

 

THE STATE OF NEW YORK

)

 

 

)

 

COUNTY OF NASSAU

)

 

 

Subscribed and sworn before me, a Notary Public in and for the County and State,
this           day of June, in the year 2007.

 

 

 

    NOTARY PUBLIC

 

 

 

My Commission Expires:

 

 

 

Signature Page to the Fourth Amended and Restated Guarantee agreement

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