Exhibit 10.36

MASTER REPURCHASE AGREEMENT

Dated as of December 20, 2013

among

PARLEX 4 UK FINCO, LLC

and

PARLEX 4 FINANCE, LLC,

as Sellers

JPMORGAN CHASE BANK, NATIONAL ASSOCIATION

as Buyer

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

TABLE OF CONTENTS

Page

 

ARTICLE 1. APPLICABILITY

     1   

ARTICLE 2. DEFINITIONS

     1   

ARTICLE 3. INITIATION; CONFIRMATION; TERMINATION; FEES; EXTENSION OF MATURITY
DATE; EXTENSION OF REPURCHASE DATE

     29   

ARTICLE 4. MARGIN MAINTENANCE

     49   

ARTICLE 5. INCOME PAYMENTS AND PRINCIPAL PROCEEDS

     50   

ARTICLE 6. SECURITY INTEREST

     53   

ARTICLE 7. PAYMENT, TRANSFER AND CUSTODY

     56   

ARTICLE 8. SALE, TRANSFER, HYPOTHECATION OR PLEDGE OF PURCHASED ASSETS

     60   

ARTICLE 9. REPRESENTATIONS AND WARRANTIES

     60   

ARTICLE 10. NEGATIVE COVENANTS OF SELLER

     69   

ARTICLE 11. AFFIRMATIVE COVENANTS OF SELLER

     70   

ARTICLE 12. EVENTS OF DEFAULT; REMEDIES

     78   

ARTICLE 13. SINGLE AGREEMENT

     84   

ARTICLE 14. RECORDING OF COMMUNICATIONS

     85   

ARTICLE 15. NOTICES AND OTHER COMMUNICATIONS

     85   

ARTICLE 16. ENTIRE AGREEMENT; SEVERABILITY

     86   

ARTICLE 17. NON-ASSIGNABILITY

     86   

ARTICLE 18. GOVERNING LAW

     88   

 

-i-

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

ARTICLE 19. NO WAIVERS, ETC.

     88   

ARTICLE 20. USE OF EMPLOYEE PLAN ASSETS

     88   

ARTICLE 21. INTENT

     89   

ARTICLE 22. DISCLOSURE RELATING TO CERTAIN FEDERAL PROTECTIONS

     90   

ARTICLE 23. CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL

     91   

ARTICLE 24. NO RELIANCE

     91   

ARTICLE 25. INDEMNITY

     92   

ARTICLE 26. DUE DILIGENCE

     93   

ARTICLE 27. SERVICING

     94   

ARTICLE 28. MISCELLANEOUS

     95   

ARTICLE 29. JOINT AND SEVERAL OBLIGATIONS; LIMITED RECOURSE

     98   

 

-ii-

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

ANNEXES, EXHIBITS AND SCHEDULES

 

ANNEX I    Names and Addresses for Communications between Parties SCHEDULE I   
Prohibited Transferees EXHIBIT I    Form of Confirmation EXHIBIT II   
Authorized Representatives of Sellers EXHIBIT III-A    Monthly Reporting Package
EXHIBIT III-B    Quarterly Reporting Package EXHIBIT III-C    Annual Reporting
Package EXHIBIT IV    Form of Custodial Delivery Certificate EXHIBIT V-A    Form
of Power of Attorney for U.S. Purchased Assets EXHIBIT V-B    Form of Power of
Attorney for Foreign Purchased Assets EXHIBIT VI    Representations and
Warranties Regarding Individual Purchased Assets EXHIBIT VII    Asset
Information EXHIBIT VIII    Purchase Procedures EXHIBIT IX    Form of Bailee
Letter EXHIBIT X    Form of Margin Deficit Notice EXHIBIT XI    Form of Tax
Compliance Certificates EXHIBIT XII    UCC Filing Jurisdictions EXHIBIT XIII   
Form of Servicer Notice EXHIBIT XIV    Form of Release Letter EXHIBIT XV   
Covenant Compliance Certificate EXHIBIT XVI    Form of Re-Direction Letter
EXHIBIT XVII    Form of Servicing Agreement for Foreign Purchased Assets

 

-iii-

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

MASTER REPURCHASE AGREEMENT

MASTER REPURCHASE AGREEMENT, dated as of December 20, 2013, by and among
JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, a banking association organized under
the laws of the United States (“Buyer”), and PARLEX 4 UK FINCO, LLC (“Foreign
Asset Seller”) and PARLEX 4 FINANCE, LLC (“U.S. Seller”) (each a Delaware
limited liability company and a “Seller” with respect to the Eligible Assets
that it sells to Buyer and together, the “Sellers”).

ARTICLE 1.

APPLICABILITY

From time to time the parties hereto may enter into transactions in which
Sellers and Buyer agree to the transfer from either Seller to Buyer of all of
its rights, title and interest to certain Eligible Assets (as defined herein) or
other assets and, in each case, the other related Purchased Items (as defined
herein) (collectively, the “Assets”) against the transfer of funds by Buyer to
such Seller, with a simultaneous agreement by Buyer to transfer back to such
Seller such Assets at a date certain or on demand, against the transfer of funds
by such Seller to Buyer. 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. Each individual transfer of
an Eligible Asset shall constitute a distinct Transaction. Notwithstanding any
provision or agreement herein, at no time shall Buyer be obligated to purchase
or effect the transfer of any Eligible Asset from either Seller to Buyer.

ARTICLE 2.

DEFINITIONS

“Accelerated Repurchase Date” shall have the meaning specified in
Article 12(b)(i) of this Agreement.

“Acceptable Attorney” shall mean Ropes & Gray, LLP with respect to U.S.
Purchased Assets or another attorney-at-law or law firm that has delivered at
U.S. Seller’s request a Bailee Letter, with the exception of an attorney or law
firm that is not reasonably satisfactory to Buyer.

“Acceptable Undertaking” shall mean a solicitor’s undertaking from Ropes & Gray
LLP (London office) or a firm of solicitors regulated by the Solicitors
Regulation Authority and approved for this purpose by the Buyer and in form and
substance reasonably satisfactory to the Buyer.

“Accepted Servicing Practices” shall mean with respect to any Purchased Asset,
those servicing practices in conformity with accepted and prudent servicing
practices in the industry and jurisdiction for loans of the same type and
relating to the same geographical area and in a manner at least equal in quality
to the service the applicable servicer provides for assets that are similar to
such Purchased Asset.

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

“Account Security Agreement” shall mean an agreement creating security over a
bank account maintained by a Foreign Obligor.

“Act of Insolvency” shall mean, with respect to any Person, (i) the filing of a
petition, commencing, or authorizing the commencement of any case or proceeding
under any bankruptcy, insolvency, reorganization, liquidation, administration,
dissolution or similar law relating to the protection of creditors (“Insolvency
Law”), or suffering any such petition or proceeding to be commenced by another
that is consented to, not timely contested, or that results in entry by a
Governmental Authority having jurisdiction of an order for relief that, in the
case of an action not instigated by or on behalf of or with the consent of such
Seller, is not dismissed or stayed within ninety (90) days; (ii) the seeking or
consenting to the appointment of a receiver, trustee, custodian or similar
official for such Person or any substantial part of the property of such Person;
(iii) the appointment of a receiver, conservator, or manager for such Person by
any governmental agency or authority having the jurisdiction to do so; (iv) the
making of a general assignment for the benefit of creditors; (v) the admission
by such Person of its inability to pay its debts or discharge its obligations as
they become due or mature; (vi) that any Governmental Authority or agency or any
person, agency or entity acting or purporting to act under Governmental
Authority shall have taken any action to condemn, seize or appropriate, or to
assume custody or control of, all or any substantial part of the property of
such Person, or shall have taken any action to displace the management of such
Person or to curtail its authority in the conduct of the business of such
Person; (vii) the consent by such Person to the entry of an order for relief in
an insolvency case under any Insolvency Law; or (viii) the taking of action by
any such Person in furtherance of any of the foregoing.

“Additional Purchase Amount” shall have the meaning specified in Article 3(x)(i)
of this Agreement.

“Additional Purchase Available Amount” shall mean the positive difference, if
any, between (x) the Maximum Advance Purchase Price as of the proposed date for
an Additional Purchase Transaction minus (y) the outstanding Purchase Price of
such Purchased Asset as of such proposed date.

“Additional Purchase Transaction” shall have the meaning specified in
Article 3(x)(i) of this Agreement.

“Additional Purchase Transaction Conditions Precedent” shall have the meaning
specified in Article 3(x)(ii).

“Advance Rate” shall mean, with respect to each Transaction and any Pricing Rate
Period, the initial Advance Rate for such Transaction as shown in the related
Confirmation, as may be adjusted for an Additional Purchase Transaction or
Future Funding Transaction as set forth herein, unless otherwise agreed to by
Buyer and the related Seller, which in any case shall not exceed the Maximum
Advance Rate.

“Affiliate” shall mean, when used with respect to any specified Person, (i) any
other Person directly or indirectly Controlling, Controlled by, or under common
Control with, such Person or (ii) any “affiliate” of such Person, as such term
is defined in the Bankruptcy Code.

 

2

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

“Affiliated Hedge Counterparty” shall mean JPMorgan Chase Bank, National
Association, or any Affiliate thereof, in its capacity as a party to any Hedging
Transaction with either Seller.

“Agreement” shall mean this Master Repurchase Agreement, dated as of
December 20, 2013 by and among JPMorgan Chase Bank, National Association, PARLEX
4 UK FINCO, LLC and PARLEX 4 FINANCE, LLC, as such agreement may be modified or
supplemented from time to time.

“Alternative Rate” shall have the meaning specified in Article 3(g) of this
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.

“Annual Reporting Package” shall mean the reporting package described on
Exhibit III-C.

“Anti-Money Laundering Laws” shall have the meaning specified in
Article 9(b)(xxix) of this Agreement.

“Applicable Currency” means U.S. dollars or Pounds Sterling, as applicable.

“Applicable Law” means all international, foreign, federal, state and local
statutes, treaties, rules, guidelines, regulations, ordinances, codes, executive
orders, and administrative or judicial precedents or authorities, including the
interpretation or administration thereof by any Governmental Authority charged
with the enforcement, interpretation or administration thereof, and all
applicable administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any Governmental Authority,
in each case whether or not having the force of law.

“Applicable Spread” shall mean, with respect to a Transaction involving a
Purchased Asset:

(i) so long as no Event of Default shall have occurred and be continuing, the
incremental per annum rate (expressed as a number of “basis points”, each basis
point being equivalent to 1/100 of 1%) specified in Schedule I attached to the
Fee Letter as being the “Applicable Spread” for Purchased Assets in such Asset
Type Grouping for the applicable LTV shown in Schedule I of the Fee Letter, as
applicable, or such other rate as may be agreed upon between the applicable
Seller and Buyer, and, in either case, as set forth in the related Confirmation;
and

(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, plus 400 basis points (4.0%);

provided, that the Applicable Spread may be increased in connection with an
Additional Purchase Transaction or Future Funding Transaction.

 

3

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

“Applicable Standard of Discretion” shall mean (a) if the ratio of (x) the
Maximum Purchase Price of such Purchased Asset to (y) the value of the related
Underlying Mortgaged Property, determined in Buyer’s commercially reasonable
discretion, is less than or equal to the LTV as of the Purchase Date, Buyer’s
commercially reasonable discretion, and (b) if the ratio of (x) the Maximum
Purchase Price of such Purchased Asset to (y) the value of the related
Underlying Mortgaged Property, determined in Buyer’s commercially reasonable
discretion, is greater than the LTV as of the Purchase Date, Buyer’s sole
discretion. For purposes of Buyer’s determination of the value of the relevant
Underlying Mortgaged Property, (i) the value may be determined using any
commercially reasonable method, including without limitation by reference to a
recent appraisal prepared in accordance with the Appraisal Regime, broker price
opinions and/or discounted cash flow analysis or any other commercially
reasonable method (for the avoidance of doubt, while not exclusive, any of the
foregoing shall be deemed for all purposes to be commercially reasonable) and
(ii) for the avoidance of doubt, Buyer may reduce value for any actual or
potential risks posed by any Liens on the related Underlying Mortgaged
Property(ies).

“Appraisal Regime” shall mean (a) with respect to U.S. Purchased Assets, FIRREA,
and (b) with respect to Foreign Purchased Assets, RICS.

“Asia House Loan” shall mean the Senior Mortgage Loan commonly referred to as
“Asia House and 24 King William Street”, represented by that certain Facilities
Agreement, dated November 27, 2013.

“Asset Due Diligence” shall have the meaning set forth in Article 3(b)(v)
hereof.

“Asset Information” shall mean, with respect to each Purchased Asset, the
information set forth in Exhibit VII attached hereto.

“Asset Type Grouping” shall have the meaning set forth in the Fee Letter.

“Assets” shall have the meaning specified in Article 1 of this Agreement.

“Assignee” shall have the meaning set forth in Article 17(a) hereof.

“Bailee Letter” shall mean (A) with respect to any U.S. Purchased Asset, a
letter from an Acceptable Attorney or from a Title Company, in the form attached
to this Agreement as Exhibit IX, wherein such Acceptable Attorney or Title
Company in possession of a Purchased Asset File (i) acknowledges receipt of such
Purchased Asset File, (ii) confirms that such Acceptable Attorney, Title
Company, or other Person acceptable to Buyer is holding the same as bailee of
Buyer under such letter and (iii) agrees that such Acceptable Attorney or Title
Company shall deliver such Purchased Asset File to the Custodian by not later
than the third (3rd) Business Day following the Purchase Date (or, if
applicable, the date of the Future Funding Transaction) for the related
Purchased Asset, and (B) with respect to any Foreign Purchased Asset, an
Acceptable Undertaking.

“Bankruptcy Code” shall mean the United States Bankruptcy Code of 1978, as
amended from time to time.

 

4

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

“Breakage Costs” shall have the meaning assigned thereto in Article 3(l).

“Business Day” shall mean any day on which banks are open for general business
in London and Jersey other than (i) a Saturday or Sunday, (ii) a day on which
the New York Stock Exchange or the Federal Reserve Bank of New York is
authorized or obligated by law or executive order to be closed and (iii) a day
on which banks in the State of New York, Pennsylvania, Kansas or Minnesota are
authorized or obligated by law or executive order to be closed or, with respect
to “London Business Days” for the determination of LIBOR, any day on which banks
in London, England are authorized or obligated by law or executive order to be
closed.

“Buyer” shall mean JPMorgan Chase Bank, National Association, or any permitted
successor or assign.

“Buyer Compliance Policy” shall mean any corporate policy of Buyer or of any
corporate entity controlling Buyer related to the compliance by Buyer or such
corporate entity or any of Buyer’s or by any such corporate entity’s Affiliates
with any Requirement of Law and/or any request or directive by any Governmental
Authority (whether or not having the force of law) and/or any proposed law, rule
or regulation, including without limitation any policy of Buyer or any such
corporation to comply with rules in proposed form or otherwise not yet in effect
or to adhere to standards or other requirements in excess of those that would be
required by any Requirement of Law.

“Buyer Funding Costs” shall mean the actual funding costs of Buyer or of any
corporate entity controlling Buyer associated with any one or more of the
Transactions (including any related Additional Purchase Transaction or Future
Funding Transaction) or otherwise with Buyer’s obligations under the Transaction
Documents.

“Buyer’s Margin Amount” shall mean with respect to any Transaction and any
Purchased Asset on any date of determination, the Advance Rate applied to such
Purchased Asset at the time that such Transaction was entered into as agreed to
by the applicable Seller and Buyer and set forth in the applicable Confirmation
(as increased as a result of any Additional Purchase Transaction or Future
Funding Transaction), multiplied by the Market Value of such Purchased Asset as
of such date of determination; provided, that to the extent the Advance Rate is
not set forth in the related Confirmation, the Advance Rate shall be deemed to
be the applicable Advance Rate set forth on Schedule I to the Fee Letter.

“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, any and all partner or
other equivalent interests in any partnership or limited partnership, and any
and all warrants or options to purchase any of the foregoing.

“Cash Equivalents” shall mean, as of any date of determination, marketable
securities issued or directly and unconditionally guaranteed as to interest and
principal by the United States Government.

 

5

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

“Cause” shall have the meaning specified in Article 11(v) of this Agreement.

“Change in Law” shall have the meaning specified in Article 3(h).

“Change of Control” shall mean the occurrence of any of the following:

(i) the consummation of a merger or consolidation of Guarantor with or into
another entity or any other reorganization, if more than fifty percent (50%) of
the combined voting power of the continuing or surviving entity’s stock or other
ownership interest in such entity outstanding immediately after such merger,
consolidation or such other reorganization is not owned directly or indirectly
by Persons who were stockholders or holders of such other ownership interests in
Guarantor immediately prior to such merger, consolidation or other
reorganization;

(ii) any “person” or “group” (within the meaning of Section 13(d) or 14(d) of
the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) shall
become, or obtain rights (whether by means of warrants, options or otherwise) to
become, the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the
Exchange Act), directly or indirectly, of a percentage of the total voting power
of all classes of Capital Stock of Guarantor entitled to vote generally in the
election of directors, of twenty percent (20%) or more other than Affiliates of
Guarantor and related funds of The Blackstone Group L.P. or to the extent such
interests are obtained through public market offering or secondary market
trading;

(iii) Guarantor shall cease to own, of record and beneficially, directly or
indirectly, one hundred percent (100%) of the outstanding Capital Stock of any
Parent and to Control any Parent or any Parent shall cease to own, of record and
beneficially, directly or indirectly, one hundred percent (100%) of the
outstanding Capital Stock of the applicable Seller and to Control the applicable
Seller; or

(iv) a Transfer of all or substantially all of Guarantor’s assets (other than
any securitization transaction or any repurchase or other similar transactions
in the ordinary course of Guarantor’s business).

“Closing Date” shall mean December 20, 2013.

“Code” shall mean the Internal Revenue Code of 1986, as amended.

“Collection Period” shall mean (i) with respect to the first Remittance Date,
the period beginning on and including the Closing Date and continuing to, and
including the calendar day immediately preceding such Remittance Date, and
(ii) with respect to each subsequent Remittance Date, the period beginning on
and including the Remittance Date in the month preceding the month in which such
Remittance Date occurs and continuing to and including the calendar day
immediately preceding the following Remittance Date.

“Concentration Limit” shall mean the limit on the maximum portion of the
aggregate Maximum Purchase Price for all Purchased Assets on each Business Day
that may relate to Purchased Assets that are Junior Mortgage Loans or Mezzanine
Loans, which limit shall be thirty-five percent (35%) of such then current
aggregate Maximum Purchase Price for all Purchased Assets.

 

6

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

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

“Connection Income Taxes” means 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, by contract or otherwise and
“Control,” “Controlling” and “Controlled” shall have meanings correlative
thereto.

“Covenant Compliance Certificate” shall mean a properly completed and executed
Covenant Compliance Certificate in form and substance identical to the
certificate attached hereto as Exhibit XV.

“Custodial Agreement” shall mean the Custodial Agreement, dated as of the date
hereof, by and among the Custodian, Sellers and Buyer.

“Custodial Delivery Certificate” shall mean the form executed by the applicable
Seller in order to deliver the Purchased Asset Schedule and the Purchased Asset
File to Buyer or its designee (including the Custodian) pursuant to Article 7(b)
of this Agreement, a form of which is attached hereto as Exhibit IV.

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

“Debenture” shall mean an English law-governed security agreement pursuant to
which a Mortgagor that (a) owns an Underlying Mortgaged Property located in
England and Wales and/or (b) is incorporated or established in England and
Wales, creates security over such Mortgagor’s entire assets and undertaking
(including any such Underlying Mortgaged Property) with respect to a Foreign
Purchased Asset.

“Default” shall mean (a) any event which, with the giving of notice, the passage
of time, or both, would constitute an Event of Default, and (b) any “Default” as
defined in the Other Repurchase Agreement.

“Defaulted Mortgage Asset” shall mean any asset (a) that is thirty (30) days or
more delinquent in the payment of principal, interest, fees or other amounts
payable under the terms of the related loan documents or other Asset
documentation or, with respect to a Senior Mortgage Loan or Junior Mortgage Loan
that is a participation interest, the Underlying Mortgage Loan is thirty
(30) days or more delinquent in the payment of principal, interest, fees or
other amounts payable under the terms of the related loan documents, (b) for
which there is a breach of the applicable representations and warranties set
forth on Exhibit VI hereto, (c) as to which an Act of Insolvency shall have
occurred (and, in the case of an involuntary Act of Insolvency, be

 

7

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

continuing) with respect to the Mortgagor, (d) as to which a non-monetary event
of default shall have occurred under any document included in the Purchased
Asset File for such Purchased Asset or (e) with respect to which there has been
an extension, amendment, waiver, termination, rescission, cancellation, release
or other modification to the terms of, or any collateral, guaranty or indemnity
for, or the exercise of any material right or remedy of a holder (including all
lending, corporate and voting rights, remedies, consents, approvals and waivers)
of any related loan or participation document that has an adverse effect on the
interest in such asset, as determined by Buyer in its sole discretion and with
respect to which Buyer has not consented to in writing.

“Depository” shall mean PNC Bank, National Association, or any successor
Depository appointed by Buyer with the prior written consent of Sellers, not to
be unreasonably withheld, conditioned or delayed.

“Depository Accounts” shall mean the segregated interest bearing accounts, in
the name of Buyer, established at Depository pursuant to this Agreement, and
which is subject to the applicable Depository Agreement.

“Depository Agreement” shall mean (i) with respect to the U.S. Purchased Assets,
that certain Depository Agreement, dated as of the date hereof, among Buyer,
U.S. Seller and Depository, or any successor agreement thereto approved by Buyer
in its discretion and (ii) with respect to the Foreign Purchased Assets, that
certain Depository Agreement, dated as of the date hereof, among Buyer, Foreign
Asset Seller and Depository, or any successor agreement thereto approved by
Buyer in its discretion.

“Due Diligence Legal Expenses” shall mean all of the reasonable and necessary
out of pocket third-party legal fees, costs and expenses actually incurred by
Buyer in connection with the Asset Due Diligence associated with Buyer’s
decision as to whether or not to enter into a particular Transaction (including
an Additional Purchase Transaction or Future Funding Transaction).

“Due Diligence Package” shall have the meaning specified in Exhibit VIII to this
Agreement, and any other similar information with respect to a Foreign Purchased
Asset.

“Early Repurchase” shall mean a repurchase of a Purchased Asset as described in
Article 3(f) of this Agreement.

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

“Eligible Assets” shall mean any of the following types of assets or loans
(1) that are acceptable to Buyer in its sole and absolute discretion (such
determination of acceptability only being applicable prior to the Purchase Date
for the related Purchased Asset, but shall not be a factor at any time after the
Purchase Date for such Purchased Asset and the initial Transaction), (2) on each
day, with respect to which the representations and warranties set forth in this
Agreement (including the exhibits hereto) are true and correct in all material
respects except to the extent disclosed in a Requested Exceptions Report
approved by Buyer, and (3) that are secured directly or indirectly by properties
that are multi-family, mixed use, industrial, office

 

8

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

building or hospitality or such other types of properties that Buyer may agree
to in its sole discretion, and are properties located in either (a) the United
States of America, its territories or possessions (or elsewhere, in the sole
discretion of Buyer) or (b) England:

(i) with respect to U.S. Purchased Assets:

(a) Senior Mortgage Loans;

(b) Junior Mortgage Loans;

(c) Mezzanine Loans; and

(d) any other asset or loan types or classifications that are acceptable to
Buyer, subject to its consent on all necessary and appropriate modifications to
this Agreement and each of the Transaction Documents, as determined by Buyer in
its sole and absolute discretion; and

(ii) with respect to Foreign Purchased Assets:

(a) Senior Mortgage Loans; and

(b) any other asset or loan types or classifications that are acceptable to
Buyer, subject to its consent on all necessary and appropriate modifications to
this Agreement and each of the Transaction Documents, as determined by Buyer in
its sole and absolute discretion.

Notwithstanding anything to the contrary contained in this Agreement, the
following shall not be Eligible Assets for purposes of this Agreement, unless
otherwise specifically agreed to by Buyer in writing: (1) non-performing loans;
(2) loans that are Defaulted Mortgage Assets; (3) any asset, where payment of
the Purchase Price with respect thereto would cause the aggregate of all
Repurchase Prices to exceed the Maximum Facility Amount; (4) construction loans;
(5) Mezzanine Loans or Junior Mortgage Loans backed by hotels with a last dollar
loan-to-value ratio in excess of seventy percent (70%); (6) other than as
approved by Buyer in its discretion, Assets where the Underlying Mortgaged
Property is owned or leased in whole or in part by any Seller, Guarantor or any
of their respective Affiliates; (7) Assets that, upon becoming a Purchased Asset
would violate the Concentration Limit; or (8) assets secured directly or
indirectly by loans described in the preceding clauses (1) through (7).

“Environmental Law” shall mean any federal, state, foreign or local statute,
law, rule, regulation, ordinance, code, guideline, written policy 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, safety or hazardous materials, pollution, the conditions of the
workplace, or the generation, handling, storage, use, release or spillage of any
substance that, alone or in combination with any other, is capable of causing
harm to the environment, including, without limitation, any waste, 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

 

9

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

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 and 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.

“Environmental Site Assessment” shall have the meaning specified in Exhibit VI.

“Equity Security Agreement” shall mean each agreement creating security over the
shares, partnership interests or other equity participation of a Foreign
Obligor.

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations promulgated thereunder. Article
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.

“ERISA Affiliate” shall mean any Person that is treated as a single employer
under Section 414(b) or (c) of the Code, or solely for purposes of Section 302
of ERISA and Section 412 of the Code is treated as a single employer described
in Section 414 of the Code.

“Event of Default” shall have the meaning specified in Article 12 of this
Agreement.

“Exchange Act” shall have the meaning specified in the definition of “Change of
Control”.

“Excluded Taxes” means any of the following Taxes imposed on or with respect to
Buyer or any Assignee, or required to be withheld or deducted from a payment to
or for the account of Buyer or Assignee, (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 or Assignee 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 Tax (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 such Buyer
or Assignee with respect to an interest under this Agreement pursuant to a law
in effect on the date on which (i) such Buyer or Assignee acquires such interest
hereunder (other than pursuant to an assignment request by Sellers under Article
3(v)) or (ii) Buyer or Assignee changes the office from which it books the
Transactions, except in each case to the extent that, pursuant to Article 3(n)
or Article 3(q), amounts with respect to such Taxes were payable either to
Buyer’s or Assignee’s assignor immediately before such Buyer or Assignee
acquired an interest hereunder or to such Buyer or Assignee immediately before
it changed the office from which it books the Transactions, (c) Taxes
attributable to such Buyer’s or Assignee’s failure to comply with its
obligations under Article 3(r) and Article 21(f), and (d) any U.S. federal
withholding Taxes imposed under FATCA.

“FATCA” means 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 any agreements entered into
with a Governmental Authority pursuant thereto (including pursuant to
Section 1471(b)(1) of the Code).

 

10

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

“FATF” shall have the meaning specified in the definition of “Prohibited
Investor”.

“FCA Regulations” shall have the meaning specified in Article 21(a) of this
Agreement.

“FDIA” shall have the meaning specified in Article 21(c) of this Agreement.

“FDICIA” shall have the meaning specified in Article 21(e) of this Agreement.

“Federal Funds Rate” shall mean, for any day, the weighted average of the rates
on overnight federal funds transactions with members of the Federal Reserve
System arranged by federal funds brokers, as published on the next succeeding
Business Day by the Federal Reserve Bank of New York, or, if such rate is not so
published for any day that is a Business Day, the average of the quotations for
the day of such transactions received by Buyer from three federal funds brokers
of recognized standing selected by it.

“Fee Letter” shall mean that certain letter agreement, dated as of the date
hereof, between Buyer and Sellers, as the same may be amended, supplemented or
otherwise modified from time to time.

“Filings” shall have the meaning specified in Article 6(i) of this Agreement.

“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 or, with respect to a Foreign Purchased Asset, IFRS, to be capitalized on a
balance sheet of the lessee.

“Fitch” shall mean Fitch Ratings, Inc.

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

“Force Majeure Event” shall mean (a) with respect to Transactions relating to
U.S. Purchased Assets, any of the following: (i) there has occurred and is
continuing an outbreak of significant hostilities or escalation thereof or other
calamity or crisis with respect to the United States or its territories, the
effect of which is that, in the reasonable judgment of Buyer, it is impossible
or commercially inadvisable to continue to enter into transactions in the
repurchase (or “repo”) market or financing market with respect to assets similar
to Eligible Assets, (ii) a banking moratorium has been declared and is
continuing under federal law, New York law, or by federal or New York
Governmental Authorities other applicable authorities, or (iii) Buyer is and
continues to be prohibited, as a result of any Requirement of Law, from entering
into transactions similar to those contemplated under the Transaction Documents
with respect to U.S. Purchased Assets; and (b) with respect to Transactions
relating to Foreign Purchased Assets, any of the following: (i) there has
occurred and is continuing an outbreak of significant hostilities or escalation
thereof or other calamity or crisis the effect of which is that, in the
reasonable judgment of Buyer, it is impossible or commercially inadvisable to
continue to enter into transactions in the repurchase (or “repo”) market or
financing market with respect to assets

 

11

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

similar to Eligible Assets, (ii) a banking moratorium has been declared and is
continuing under federal law, New York law, the law of England and Wales or the
United Kingdom, or by England and Wales or the United Kingdom, federal or New
York Governmental Authorities other applicable authorities, or (iii) Buyer is
and continues to be prohibited, as a result of any Requirement of Law, from
entering into transactions similar to those contemplated under the Transaction
Documents.

“Foreign Asset Seller” shall have the meaning specified in the Recitals of this
Agreement.

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

“Foreign Buyer” shall mean an Assignee that is not a U.S. Person.

“Foreign Finance Documents” shall mean, with respect to a Foreign Purchased
Asset, the related loan agreement under which the related Foreign Mortgage Loan
is made, any guarantee entered into in relation to such Foreign Purchased Asset
that is not contained in such loan agreement, each related Foreign Mortgage Loan
Security Agreement, any subordination agreement entered into in relation to any
related Subordinated Debt, and any other material documents relating to such
Foreign Purchased Asset.

“Foreign Mortgage” shall mean a Debenture.

“Foreign Mortgage Loan” shall mean a Senior Mortgage Loan or a Junior Mortgage
Loan relating to an Underlying Mortgaged Property located in England and Wales.

“Foreign Mortgage Loan Security Agreements” shall mean, with respect to a
Foreign Purchased Asset: (a) each Equity Security Agreement relating to such
Foreign Purchased Asset; (b) a Debenture relating to such Foreign Purchased
Asset; (c) each Subordinated Creditor’s Security Agreement relating to such
Foreign Purchased Asset; (d) each Account Security Agreement relating to such
Foreign Purchased Asset; and (e) any other document creating security in favor
of the lenders under the related Foreign Mortgage Loan that is delivered by or
on behalf of any Foreign Obligor under such Foreign Mortgage Loan.

“Foreign Obligor” shall mean an entity identified as a borrower and/or a
guarantor in the related loan agreement under which a Foreign Mortgage Loan is
made or that otherwise creates any security over any asset as security for the
obligations of any entity under such Foreign Mortgage Loan.

“Foreign Purchased Asset” shall mean a Purchased Asset with respect to which the
Underlying Mortgaged Property is located in England and Wales.

“Fraudulent Transfer Laws” shall have the meaning specified in Article 29(b).

 

12

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

“Future Funding Amount” shall have the meaning specified in Article 3(y)(i).

“Future Funding Confirmation” shall have the meaning specified in Article
3(y)(i).

“Future Funding Date” shall mean, with respect to any Purchased Asset, the date
on which Buyer advances any portion of the Future Funding Amount related to such
Purchased Asset.

“Future Funding Transaction” shall mean an additional Transaction requested with
respect to any Purchased Asset to provide for the advance of additional funds in
connection with any future funding that the applicable Seller is obligated to
make to the related Mortgagor under a Purchased Asset.

“Future Funding Transaction Conditions Precedent” shall have the meaning
specified in Article 3(y)(iii).

“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
and any Person 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).

“Guarantee Agreement” shall mean the Guarantee Agreement, dated as of the date
hereof, from Guarantor, as guarantor in favor of Buyer, in form and substance
acceptable to Buyer.

“Guarantor” shall mean Blackstone Mortgage Trust, Inc., a Maryland corporation.

“Hedge-Required Asset” shall mean any Eligible Asset that is a fixed rate
Eligible Asset.

“Hedging Transactions” shall mean, with respect to any or all of the Purchased
Assets, 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 or the exchange
of nominal interest obligations, entered into by any Affiliated Hedge
Counterparty or Qualified Hedge Counterparty with any Seller, either generally
or under specific contingencies that is required by Buyer, or otherwise pursuant
to this Agreement, to hedge the financing of a Hedge-Required Asset, or that
such Seller has elected to pledge or transfer to Buyer pursuant to this
Agreement.

“IFRS” shall mean international accounting standards within the meaning of the
IAS Regulation 1606/2002.

“Income” shall mean, with respect to any Purchased Asset at any time, (x) any
collections or receipts of principal, interest, dividends, receipts or other
distributions or collections or any

 

13

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

other amounts related to such Purchased Asset, (y) all net sale proceeds
received by a Seller or any Affiliate of a Seller in connection with a sale or
liquidation of such Purchased Asset and (z) all payments actually received by
Buyer on account of Hedging Transactions.

“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; (e) obligations of such Person under repurchase agreements,
sale/buy-back agreements or like arrangements; (f) Indebtedness of others
guaranteed by such Person; (g) all obligations of such Person incurred in
connection with the acquisition or carrying of fixed assets by such Person;
(h) Indebtedness of general partnerships of which such Person is a general
partner or is secondarily or contingently liable (other than by endorsement of
instruments in the course of collection), whether by reason of any agreement to
acquire such indebtedness to supply or advance sums or otherwise; (i) all net
liabilities or obligations under any interest rate, interest rate swap, interest
rate cap, interest rate floor, interest rate collar, or other hedging instrument
or agreement; and (j) all obligations of such Person under Financing Leases.
Notwithstanding the foregoing, bona fide securitizations that fall into this
category solely as a result of the application of FAS 166 and/or FAS 167 shall
not be considered Indebtedness of any Person.

“Indemnified Amounts” shall have the meaning specified in Article 25 of this
Agreement.

“Indemnified Parties” shall have the meaning specified in Article 25 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 any
Seller under any Transaction Document and (b) to the extent not otherwise
described in clause (a) of this definition, Other Taxes.

“Independent Director” shall mean an individual with at least three (3) years of
employment experience serving as an independent director at the time of
appointment who is provided by, and is in good standing with, CT Corporation,
Corporation Service Company, National Registered Agents, Inc., Wilmington Trust
Company, Stewart Management Company, Lord Securities Corporation or, if none of
those companies is then providing professional independent directors or managers
or is not acceptable to the Rating Agencies, another nationally recognized
company reasonably approved by Buyer, in each case that is not an Affiliate of
either Seller and that provides professional independent directors or managers
and other corporate services in the ordinary course of its business, and which
individual is duly appointed as a

 

14

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

member of the board of directors or board of managers of the applicable Seller
and is not, and has never been, and will not while serving as independent
director or manager be:

(a) a member (other than an independent, non-economic “springing” member),
partner, equityholder, manager, director, officer or employee of either Seller
or any Seller’s equityholders or Affiliates (other than as an independent
director or manager of an Affiliate of a Seller that is not in the direct chain
of ownership of Sellers and that is required by a creditor to be a single
purpose bankruptcy remote entity, provided that such independent director or
manager is employed by a company that routinely provides professional
independent directors or managers in the ordinary course of business);

(b) a customer, creditor, supplier or service provider (including provider of
professional services) to any Seller or a Seller’s equityholders or Affiliates
(other than a nationally recognized company that routinely provides professional
independent directors or managers and other corporate services to any Seller or
any Seller’s equityholders or Affiliates in the ordinary course of business);

(c) a family member of any such member, partner, equityholder, manager,
director, officer, employee, customer, creditor, supplier or service provider;
or

(d) a Person that Controls or is under common Control with (whether directly,
indirectly or otherwise) any of (a), (b) or (c) above.

A natural person who otherwise satisfies the foregoing definition other than
subparagraph (a) by reason of being the independent director or manager of a
single purpose bankruptcy remote entity in the direct chain of ownership of a
Seller shall not be disqualified from serving as an independent director or
manager of a Seller, provided that the fees that such individual earns from
serving as independent directors or managers of such Affiliates in any given
year constitute in the aggregate less than five percent (5%) of such
individual’s annual income for that year.

“Insolvency Law” shall have the meaning specified in the definition of “Act of
Insolvency”.

“Insolvency Regulation” shall have the meaning specified in Article 10(l) of
this Agreement.

“Interim Servicer” shall mean Midland Loan Services, Inc., or any other servicer
approved by Buyer in its commercially reasonable discretion.

“Interim Servicing Agreement” shall mean (i) with respect to all U.S. Purchased
Assets, the Interim Servicing Agreement, dated as of the date hereof, by and
among the Interim Servicer, U.S. Seller and Buyer and (ii) with respect to all
Foreign Purchased Assets, the Interim Servicing Agreement, dated as of the date
hereof, by and among Interim Servicer, Foreign Asset Seller and Buyer.

“IRS” shall mean the United States Internal Revenue Service.

 

15

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

“Junior Mortgage Loan” shall mean a performing mortgage loan evidenced by one or
more junior promissory notes or a participation interest evidenced by a
certificate of participation in a stabilized or transitional commercial,
multifamily fixed or floating rate mortgage loan evidenced by a promissory note,
in each case secured by first liens on multi-family or commercial properties.

“Knowledge” shall mean, as of any date of determination, the then-current actual
(as distinguished from imputed or constructive) knowledge of (i) Stephen Plavin,
Robert Harper, Thomas C. Ruffing or Douglas Armer, (ii) any asset manager at The
Blackstone Group L.P. responsible for any Purchased Asset, or (iii) any other
employee with a title equivalent or more senior to that of “principal” within
The Blackstone Group L.P. responsible for the origination, acquisition and/or
management of any Purchased Asset.

“LIBOR” shall mean, with respect to each Pricing Rate Period, the rate
determined by Buyer to be (i) the per annum rate for deposits in U.S. dollars
(with respect to U.S. Purchased Assets) or Pound Sterling (with respect to
Foreign Purchased Assets) for a period equal to the applicable Pricing Rate
Period, which appears on the Reuters Screen LIBOR01 Page (or any successor
thereto) as the London Interbank Offering Rate as of 11:00 a.m., London time, on
the day that is two (2) London Business Days prior to that respective Pricing
Rate Determination Date (rounded upwards, if necessary, up to the nearest 1/1000
of 1%); (ii) if such rate does not appear on said Reuters Screen LIBOR01 Page,
the arithmetic mean (rounded as aforesaid) of the offered quotations of rates
obtained by Buyer from the Reference Banks for deposits in U.S. dollars (with
respect to U.S. Purchased Assets) or Pound Sterling (with respect to Foreign
Purchased Assets) for a period equal to the applicable Pricing Rate Period to
prime banks in the London Interbank market as of approximately 11:00 a.m.,
London time, on the day that is two (2) London Business Days prior to that
Pricing Rate Determination Date and in an amount that is representative for a
single transaction in the relevant market at the relevant time; or (iii) if
fewer than two (2) Reference Banks provide Buyer with such quotations, the rate
per annum which Buyer determines to be the arithmetic mean (rounded as
aforesaid) of the offered quotations of rates which major banks in New York, New
York selected by Buyer are quoting at approximately 11:00 a.m., New York City
time, on the Pricing Rate Determination Date for loans in U.S. dollars to
leading European banks for a period equal to the applicable Pricing Rate Period
in amounts of not less than U.S. $1,000,000.00. Buyer’s determination of LIBOR
shall be binding and conclusive on Sellers absent manifest error. LIBOR may or
may not be the lowest rate based upon the market for U.S. dollar or
Pound Sterling deposits, as applicable, in the London Interbank Eurodollar
Market at which Buyer prices loans on the date which LIBOR is determined by
Buyer as set forth above.

“Lien” shall mean any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge or other security
interest or preference, priority or other security agreement or preferential
arrangement of any kind or nature whatsoever (including, without limitation, any
conditional sale or other title retention agreement and any Financing Lease
having substantially the same economic effect as any of the foregoing), and the
filing of any financing statement under the UCC or comparable law of any
jurisdiction in respect of any of the foregoing.

 

16

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

“London Business Day” shall mean any day other than (a) a Saturday, (b) a Sunday
or (c) any other day on which commercial banks in London, England are not open
for business.

“LTV” shall mean, with respect to any Purchased Asset, the ratio of the
aggregate outstanding debt (which shall include such Purchased Asset and all
debt senior to or pari passu with such Purchased Asset whether advanced on such
date or permitted to be advanced in the future) secured, directly or indirectly,
by the related Underlying Mortgaged Property(ies), to the aggregate value of
such Underlying Mortgaged Property(ies) as determined by Buyer in its
commercially reasonable discretion. For purposes of Buyer’s determination,
(i) the value of the Underlying Mortgaged Property may be determined using any
commercially reasonable method, including without limitation by reference to a
recent appraisal, broker price opinions, quotes from a recognized dealer in the
commercial real estate market and/or discounted cash flow analysis or other
method commonly utilized by Buyer or any other commercially reasonable method
and the foregoing shall be deemed for such purposes to be commercially
reasonable and (ii) for the avoidance of doubt, Buyer may reduce the value of
the Underlying Mortgaged Property for any actual or potential risks posed by any
Liens on the related Underlying Mortgaged Property(ies).

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

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

“Margin Notice Deadline” shall mean 1:00 p.m. New York time.

“Mark-to-Market Representations” shall mean the representations and warranties
set forth (1) as items (t), (aa), (dd), (oo) and (rr) on Part 1 of Exhibit VI,
(2) as item (j) on Part 2 of Exhibit VI, (3) as item (k) on Part 3 of Exhibit
VI, and (4) as items (p), (bb), (gg), (ii), (mm) and (qq) on Part 4 of Exhibit
VI.

“Market Disruption Event” shall mean either (a) any event or events shall have
occurred (with respect to (i) Transactions relating to U.S. Purchased Assets, in
the United States or England and Wales or (ii) with respect to Transactions
relating to Foreign Purchased Assets, in England and Wales) in the determination
of Buyer resulting in the effective absence of a “repo market” or related
“lending market” for purchasing (subject to repurchase) or financing debt
obligations secured by commercial mortgage loans, mezzanine loans or securities
or an event or events shall have occurred resulting in Buyer not being able to
finance Eligible Assets through the “repo market” or “lending market” with
traditional counterparties at rates which would have been reasonable prior to
the occurrence of such event or events, or (b) any event or events shall have
occurred (with respect to (i) Transactions relating to U.S. Purchased Assets, in
the United States or England and Wales or (ii) with respect to Transactions
relating to Foreign Purchased Assets, in England and Wales) resulting in the
effective absence of a “securities market” for securities backed by Eligible
Assets, including, but not limited to the “CMBS/CLO market”, or an event or
events shall have occurred resulting in Buyer not being able to sell securities
backed by Eligible Assets at prices which would have been reasonable prior to
such event or events, in each case as determined by Buyer.

 

17

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

“Market Value” shall mean, with respect to any Purchased Asset, the market value
for such Purchased Asset, as determined by Buyer at the Applicable Standard of
Discretion on each Business Day in accordance with this definition. For purposes
of Article 4 and 5(e), as applicable, changes in the Market Value of a Purchased
Asset that is a Senior Mortgage Loan or a Junior Mortgage 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 (i) the performance or condition of the Underlying Mortgaged
Property(ies) securing the Purchased Asset or other collateral securing or
related to the Purchased Asset, (ii) the performance or condition of the
Purchased Asset’s borrower (including obligors, guarantors, participants and
sponsors) and the borrower on any Underlying Mortgaged Property or other
collateral securing such Purchased Asset or the Underlying Mortgage Loan, as
applicable, (iii) the performance or condition of the commercial real estate
market relevant to the Underlying Mortgaged Property(ies), (iv) any actual or
potential risks posed by any Liens on the related Underlying Mortgaged
Property(ies), and (v) with respect to Foreign Purchased Assets only, the change
in any law, regulation or regulatory policy, tax treaty or regime, licensing
requirement or any similar event having an effect on the applicable Foreign
Purchased Asset, taken in the aggregate. In addition, the Market Value for any
Purchased Asset shall be deemed to be zero on the third (3rd) Business Day
following the occurrence of any of the following with respect to such Purchased
Asset: (a) a breach of a representation or warranty contained in Exhibit VI
hereto other than a Mark-to-Market Representation or (b) the Repurchase Date
with respect to such Purchased Asset occurs without repurchase of such Purchased
Asset.

“Material Action” shall mean, as to any Person, to file any insolvency, or
reorganization case or proceeding, to institute proceedings to have such Person
be adjudicated bankrupt or insolvent, to institute proceedings under any
applicable insolvency law, to seek any relief under any law relating to relief
from debts or the protection of debtors, to consent to the filing or institution
of bankruptcy or insolvency proceedings against such Person, to file a petition
seeking, or consent to, reorganization or relief with respect to such Person
under any applicable federal or state law relating to bankruptcy or insolvency,
to seek or consent to the appointment of a receiver, liquidator, assignee,
trustee, sequestrator, custodian, or any similar official of or for such Person
or a substantial part of its property, to make any assignment for the benefit of
creditors of such Person, to admit in writing such Person’s inability to pay its
debts generally as they become due (unless such admission is true), or to take
action in furtherance of any of the foregoing.

“Material Adverse Effect” shall mean a material adverse effect on (a) the
property, business, operations or financial condition of any Seller or Guarantor
taken as a whole, (b) the ability of any Seller or Guarantor to perform its
obligations under any of the Transaction Documents, (c) the validity or
enforceability of any of the Transaction Documents, (d) the rights and remedies
of Buyer under any of the Transaction Documents, (e) the timely payment of any
amounts payable under this Agreement or any other Transaction Document.

“Materials of Environmental Concern” shall mean any toxic mold, any petroleum
(including, without limitation, crude oil or any fraction thereof) or petroleum
products (including, without limitation, gasoline) or any hazardous or toxic
substances, materials or wastes, defined as such in or regulated under any
Environmental Law, including, without limitation, asbestos, polychlorinated
biphenyls, and urea-formaldehyde insulation.

 

18

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

“Maturity Date” shall mean December 20, 2016 or the immediately succeeding
Business Day, if such day shall not be a Business Day.

“Maximum Advance Purchase Price” shall mean, with respect to a Purchased Asset
with respect to which an Additional Purchase Transaction is requested in
accordance with the terms of this Agreement, an amount equal to the product
obtained by multiplying (i) the Market Value of such Purchased Asset (or the par
amount of such Purchased Asset, if lower than Market Value) as re-determined by
Buyer as of the proposed date of such requested Additional Purchase Transaction
by (ii) the Maximum Advance Rate permitted for such Purchased Asset as set forth
in this Agreement.

“Maximum Advance Rate” shall mean, with respect to each Eligible Asset, the
“Advance Rate” specified for the applicable Asset Type Grouping in Schedule I
attached to the Fee Letter for the loan-to-value ratios shown in Schedule I, or
if not shown in Schedule I attached to the Fee Letter or if otherwise agreed to
by Sellers and Buyer, in the related Confirmation; provided, however, that
(a) the Buyer is not obligated to purchase any Eligible Asset and (b) with
respect to any Eligible Asset to be purchased hereunder, the Advance Rates shown
in Schedule I attached to the Fee Letter are only indicative of the maximum
advance rate available to Sellers, and Buyer is not obligated to purchase any
Eligible Asset at such Maximum Advance Rates.

“Maximum Facility Amount” shall mean £153,036,239.

“Maximum Purchase Price” shall mean, with respect to any Purchased Asset, an
amount (expressed in the Applicable Currency) equal to the product obtained by
multiplying (i) the Market Value of such Purchased Asset (or the par amount of
such Purchased Asset, if lower than Market Value) as of the Purchase Date by
(ii) the Maximum Advance Rate permitted for such Purchased Asset as set forth in
this Agreement.

“Mezzanine Loan” shall mean a performing loan evidenced by a note and primarily
secured by pledges of all the equity interests in entities that own, directly or
indirectly, multifamily or commercial properties that serve as collateral for
Senior Mortgage Loans.

“Mezzanine Note” shall mean the original promissory note that was executed and
delivered in connection with a particular Mezzanine Loan.

“Minimum Transfer Amount” shall mean, with respect to each Seller, £153,037.

“Monthly Reporting Package” shall mean the reporting package described on
Exhibit III-A.

“Moody’s” shall mean Moody’s Investors Service, Inc.

“Mortgage” shall mean (i) with respect to a U.S. Purchased Asset, a mortgage,
deed of trust, deed to secure debt, charge or other instrument, creating a valid
and enforceable first Lien on or a first priority ownership interest in an
estate in fee simple or term of years in real property and the improvements
thereon, securing a Mortgage Note or similar evidence of indebtedness or
(ii) with respect to a Foreign Purchased Asset, a Foreign Mortgage.

 

19

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

“Mortgage Note” shall mean, (i) with respect to a U.S. Purchased Asset, a note
or other evidence of indebtedness of a Mortgagor secured by a Mortgage,
including any Senior Mortgage Loan or Junior Mortgage Loan that is a U.S.
Purchased Asset, and (ii) with respect to a Foreign Purchased Asset, any
evidence of indebtedness of a Mortgagor.

“Mortgagor” shall mean, (i) with respect to a U.S. Purchased Asset, the obligor
on a Mortgage Note and the grantor of the related Mortgage, or the obligor on a
Mezzanine Note or Participation Certificate, and (ii) with respect to a Foreign
Purchased Asset, the Foreign Obligor that is expressed in the loan agreement for
the relevant Foreign Mortgage Loan to be the legal or beneficial owner of the
relevant Underlying Mortgaged Property.

“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 either Seller or any ERISA Affiliate and that is covered by
Title IV of ERISA.

“New Asset” shall mean an Eligible Asset that either Seller proposes to be
included as a Purchased Item.

“OFAC” shall have the meaning specified in the definition of “Prohibited
Investor”.

“Originated Asset” shall mean any Eligible Asset originated by either Seller.

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

“Other Facility” shall mean the Other Repurchase Agreement and any documents
related thereto.

“Other Facility Buyer” shall mean the “Buyer”, as defined in the Other
Repurchase Agreement.

“Other Facility Purchased Items” shall mean “Purchased Items” as defined in the
Other Repurchase Agreement.

“Other Facility Repurchase Obligations” shall mean “Repurchase Obligations” as
defined in the Other Repurchase Agreement.

“Other Repurchase Agreement” shall mean that certain Master Repurchase
Agreement, dated as of June 28, 2013 (as amended, restated, supplemented or
otherwise modified and in effect from time to time), by and among Parlex 4
Finance, LLC, as seller, and Other Facility Buyer, as buyer.

“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

 

20

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

stamp duty reserve tax) that arise from any payment made under, from the
execution, delivery, performance, enforcement or registration of, from the
receipt or perfection of a security interest under, or otherwise with respect
to, any Transaction Document, except for (i) any such Taxes imposed with respect
to an assignment, transfer or sale of participation or other interest in or with
respect to the Transaction Documents (other than an assignment made pursuant to
Article 3(v) hereof), and (ii) for the avoidance of doubt, any Excluded Taxes.

“Parent” shall mean (i) with respect to U.S. Seller, 42-16 Partners, LLC and
(ii) with respect to Foreign Asset Seller, 345-40 Partners LLC, each a wholly
owned Subsidiary of Guarantor.

“Participants” shall have the meaning set forth in Article 17(a) of this
Agreement.

“Participation Certificate” shall mean the original participation certificate
that was executed and delivered in connection with a Senior Mortgage Loan or
Junior Mortgage Loan that is a participation interest.

“Person” shall mean an individual, corporation, limited liability company,
business trust, partnership, joint tenant or tenant-in-common, trust, joint
stock company, joint venture, unincorporated organization, or any other entity
of whatever nature, or a Governmental Authority.

“Plan” shall mean an employee benefit or other plan established or maintained by
either Seller or any ERISA Affiliate during the five year period ended prior to
the date of this Agreement or to which such 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 set forth in Article 20(a) of this
Agreement.

“Pledge Agreement” shall mean that certain Amended and Restated Pledge
Agreement, dated as of the date hereof, by each Parent in favor of Buyer, as the
same may be amended, restated, supplemented, replaced or otherwise modified from
time to time, pledging all of each Seller’s Capital Stock to Buyer.

“Pound Sterling” shall mean the lawful currency for the time being of the United
Kingdom.

“Pre-Existing Asset” shall mean any Eligible Asset that is not an Originated
Asset.

“Price Differential” shall mean, with respect to any Purchased Asset as of any
date, the aggregate amount obtained by daily application of the applicable
Pricing Rate for such Purchased Asset to the outstanding Purchase Price of such
Purchased Asset on a 360-day-per-year basis for the actual number of days during
each Pricing Rate Period commencing on (and including) the Purchase Date for
such Purchased Asset and ending on (but excluding) the date of determination
(reduced by any amount of such Price Differential previously paid by the
applicable Seller to Buyer with respect to such Purchased Asset).

 

21

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

“Pricing Rate” shall mean, for any Pricing Rate Period, an annual rate equal to
the sum of (i) LIBOR and (ii) the relevant Applicable Spread, in each case, for
the applicable Pricing Rate Period for the related Purchased Asset. The Pricing
Rate shall be subject to adjustment and/or conversion as provided in the
Transaction Documents or the related Confirmation.

“Pricing Rate Determination Date” shall mean with respect to any Pricing Rate
Period with respect to any Transaction, the second (2nd) London Business Day
preceding the first day of such Pricing Rate Period.

“Pricing Rate Period” shall mean, with respect to any Transaction, Remittance
Date or Repurchase Date (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 the immediately preceding Remittance Date and ending
on and excluding such Remittance Date; provided, however, that in no event shall
any Pricing Rate Period for a Purchased Asset end subsequent to the Repurchase
Date for such Purchased Asset.

“Principal Proceeds” shall mean, with respect to any Purchased Asset, any
scheduled or unscheduled payment or prepayment of principal (including net sale
proceeds) received by the Depository or allocated as principal in respect of any
such Purchased Asset.

“Prohibited Investor” shall mean (1) a person or entity whose name appears on
the list of Specially Designated Nationals and Blocked Persons by the United
States Treasury Department’s Office of Foreign Asset Control (“OFAC”) or any
sanctions or “black” list maintained by the Financial Conduct Authority, the
Foreign & Commonwealth Office, HM Treasury or the United Nations or any list
maintained in accordance with the Common Foreign and Security Policy of the EU,
(2) any foreign shell bank, and (3) any person or entity resident in or whose
subscription funds are transferred from or through an account in a jurisdiction
that has been designated as a non-cooperative with international anti-money
laundering principles or procedures by an intergovernmental group or
organization, such as the Financial Action Task Force on Money Laundering
(“FATF”), of which the U.S. is a member and with which designation the U.S.
representative to the group or organization continues to concur. (See
http://www.fatf-gati.org for FATF’s list of Non-Cooperative Countries and
Territories.)

“Prohibited Person” shall have the meaning set forth in Article 9(b)(xxvii).

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

“Property Report” shall mean, with respect to a Foreign Purchased Asset, any
certificate or report title in relation to the Underlying Mortgaged Property
that is delivered as a condition precedent to the making of the related Foreign
Mortgage Loan under the loan agreement for such Foreign Mortgage Loan.

 

22

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

“Purchase Date” shall mean, with respect to any Purchased Asset, the date on
which Buyer purchases such Purchased Asset from the applicable Seller in
connection with a Transaction.

“Purchase Price” shall mean, with respect to any Purchased Asset, the price at
which such Purchased Asset is transferred by the applicable Seller to Buyer on
the applicable Purchase Date, adjusted after the Purchase Date as set forth
below, not to exceed the Maximum Purchase Price. The Purchase Price as of the
Purchase Date for any Purchased Asset shall be an amount (expressed in the
Applicable Currency) equal to the product obtained by multiplying (i) the Market
Value of such Purchased Asset as of the Purchase Date (or the par amount of such
Purchased Asset, if lower than Market Value) by (ii) the Advance Rate for such
Purchased Asset, as set forth on the related Confirmation. The Purchase Price of
any Purchased Asset shall be (x) increased by an Additional Purchase Amount or
Future Funding Amount made by Buyer to the applicable Seller or by any other
amounts disbursed by Buyer to such Seller or to the related borrower on behalf
of such Seller with respect to such Purchased Asset to the related borrower on
behalf of such Seller with respect to such Purchased Asset and (y) decreased by
(A) the portion of any Principal Proceeds on such Purchased Asset that are
applied pursuant to Article 5 hereof to reduce such Purchase Price and (B) any
other amounts paid to Buyer by the applicable Seller specifically to reduce such
Purchase Price and that are applied pursuant to Article 5 hereof to reduce such
Purchase Price.

Solely for purposes of calculations related to the Maximum Facility Amount, any
Transaction denominated in U.S. Dollars shall be converted to the Pound Sterling
equivalent by utilizing the Spot Rate quoted by Buyer on the related Purchase
Date (which shall be set forth in the applicable Confirmation).

“Purchased Asset” shall mean (i) with respect to any Transaction, the Eligible
Asset sold by the related Seller to Buyer in such Transaction and (ii) with
respect to the Transactions in general, all Eligible Assets sold by the Sellers
to Buyer (other than Purchased Assets that have been repurchased by a Seller).

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

“Purchased Asset Fee” shall have the meaning set forth in the Fee Letter.

“Purchased Asset File” shall mean the documents specified as the “Purchased
Asset File” in Article 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; provided that to the extent that Buyer
waives, including pursuant to Article 7(b), receipt of any document in
connection with the purchase of an Eligible Asset (but not if Buyer merely
agrees to accept delivery of such document after the Purchase Date), such
document shall not be a required component of the Purchased Asset File until
such time as Buyer determines in good faith that such document is necessary or
customary for the servicing of the applicable Purchased Asset.

 

23

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

“Purchased Asset Schedule” shall mean a schedule of Purchased Assets attached to
each Trust Receipt and Custodial Delivery Certificate containing information
substantially similar to the Asset Information.

“Purchased Items” shall have the meaning specified in Article 6(a) of this
Agreement.

“Qualified Hedge Counterparty” shall mean, with respect to any Hedging
Transaction, any entity, other than an Affiliated Hedge Counterparty, that
(a) qualifies as an “eligible contract participant” as such term is defined in
the Commodity Exchange Act (as amended by the Commodity Futures Modernization
Act of 2000), (b) the long-term debt of which is rated no less than “A+” by S&P,
and “A1” by Moody’s and (c) is reasonably acceptable to Buyer; provided, that
with respect to clause (c), if Buyer has approved an entity as a counterparty,
it may not thereafter deem such counterparty unacceptable with respect to any
previously outstanding Transaction unless clause (a) or clause (b) no longer
applies with respect to such counterparty.

“Quarterly Reporting Package” shall mean the reporting package described on
Exhibit III-B.

“Rating Agency” shall mean any of Fitch, Moody’s, S&P, DBRS, Inc. and Kroll Bond
Rating Agency Inc.

“Re-direction Letter” shall have the meaning specified in Article 5(b).

“Reference Banks” shall mean banks each of which shall (i) be a leading bank
engaged in transactions in Eurodollar deposits in the international Eurocurrency
market and (ii) have an established place of business in London. Initially, the
Reference Banks shall be JPMorgan Chase Bank, National Association, Barclays
Bank, Plc and Deutsche Bank AG. If any such Reference Bank should be unwilling
or unable to act as such or if Buyer shall terminate the appointment of any such
Reference Bank or if any of the Reference Banks should be removed from the
Reuters Monitor Money Rates Service or in any other way fail to meet the
qualifications of a Reference Bank, Buyer, in its sole discretion exercised in
good faith, may designate alternative banks meeting the criteria specified in
clauses (i) and (ii) above.

“Register” shall have the meaning assigned in Article 17(c).

“Release Letter” shall mean a letter substantially in the form of Exhibit XIV
hereto (or such other form as may be acceptable to Buyer).

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

“Remittance Date” shall mean (i) with respect to Purchased Assets other than
Foreign Purchased Assets, the seventeenth (17th) calendar day of each month, or
the immediately succeeding Business Day, if such calendar day shall not be a
Business Day and (ii) with respect to Purchased Assets that are Foreign
Purchased Assets, January 23, April 23, July 23 and October 23, or the
immediately 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
Sellers and Buyer.

 

24

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

“Repurchase Date” shall mean, with respect to a Purchased Asset, the earliest to
occur of (i) any Early Repurchase Date for such Transaction; (ii) the date set
forth in the applicable Confirmation; (iii) the Accelerated Repurchase Date;
(iv) the Maturity Date; and (v) the date that is two (2) Business Days prior to
the maturity date of such Purchased Asset (subject to extension, if applicable,
in accordance with the related Purchased Asset Documents); provided that, solely
with respect to clause (v), the settlement with respect to such Repurchase Date
and Purchased Asset may occur two (2) Business Days later.

“Repurchase Obligations” shall have the meaning assigned thereto in
Article 6(a).

“Repurchase Price” shall mean, with respect to any Purchased Asset as of any
Repurchase Date or any date on which the Repurchase Price is required to be
determined hereunder, the price at which such Purchased Asset is to be
transferred from Buyer to the applicable Seller; such price will be determined
in each case as the sum of the (i) outstanding Purchase Price of such Purchased
Asset (inclusive of any other additional funds advanced by Buyer in connection
with such Purchased Asset including Additional Purchase Amounts and/or Future
Funding Amounts); (ii) the accreted and unpaid Price Differential with respect
to such Purchased Asset as of the date of such determination (other than, with
respect to calculations in connection with the determination of a Margin
Deficit, accreted and unpaid Price Differential for the current Pricing Rate
Period); (iii) any other amounts due and owing by any Seller to Buyer and its
Affiliates pursuant to the terms of this Agreement as of such date; (iv) if such
Repurchase Date is not a Remittance Date, except as otherwise expressly set
forth in this Agreement, any Breakage Costs payable in connection with such
repurchase other than with respect to the determination of a Margin Deficit;
(v) any amounts that would be payable to (a positive amount) a Qualified Hedge
Counterparty under any related Hedging Transaction, if such Hedging Transaction
were terminated on the date of determination, if such determination is in
connection with any calculation of Margin Deficit; and (vi) any amounts that
would be payable to (a positive amount) an Affiliated Hedge Counterparty under
any related Hedging Transaction, if such Hedging Transaction were terminated on
the date of determination, if such determination is in connection with any
calculation of Margin Deficit (and not in connection with an actual repurchase
of a Purchased Asset). In addition to the foregoing, the Repurchase Price shall
be decreased by (A) the portion of any Principal Proceeds on such Purchased
Asset that is applied pursuant to Article 5 hereof to reduce such Repurchase
Price for such Purchased Asset and (B) any other amounts paid to Buyer by or on
behalf of the applicable Seller to reduce such Repurchase Price for such
Purchased Asset.

“Requested Exceptions Report” shall have the meaning assigned thereto in
Article 3(b)(v)(E).

“Required Filing” means registration of particulars of the Mortgage at the
Companies Registration Office under the Companies Act 2006 and payment of
associated fees; and registration of the Mortgage at the Land Registry or Land
Charges Registry in England and Wales and payment of associated fees.

“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.

 

25

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

“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.

“Responsible Officer” shall mean the officers of Seller as designated in its
operating agreement.

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

“S&P” shall mean Standard and Poor’s Ratings Services.

“SEC” shall have the meaning specified in Article 22(a) of this Agreement.

“Secondary Market Transaction” shall have the meaning set forth in
Article 28(a).

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

“Seller” shall mean each entity identified as a “Seller” in the Recitals hereto
and such other sellers as may be approved by Buyer in its sole discretion from
time to time.

“Senior Mortgage Loan” shall mean, in respect of a U.S. Purchased Asset, a
performing senior commercial or multifamily fixed or floating rate senior
mortgage loan evidenced by one or more promissory notes or senior participation
interests in such a mortgage loan evidenced by a certificate of participation,
in each case secured by first liens on multifamily or commercial properties,
and, in respect of a Foreign Purchased Asset, a performing senior commercial or
multifamily fixed or floating rate senior mortgage loan or senior participation
interests in such a mortgage loan evidenced by a certificate of participation,
in each case secured by first liens on multifamily or commercial properties.

“Senior Tranche” shall have the meaning set forth in Section 28(a).

“Servicer Notice” shall mean the agreement between Buyer, Seller and the primary
servicer, substantially in the form of Exhibit XIII hereto, as amended,
supplemented or otherwise modified from time to time.

“Servicing Agreement” shall have the meaning specified in Article 27(b).

“Servicing Records” shall have the meaning specified in Article 27(b).

 

26

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

“Servicing Rights” shall mean rights of any Person, to administer, service or
subservice, the Purchased Assets or to possess related Servicing Records.

“Servicing Tape” shall have the meaning specified in Exhibit III-A hereto.

“SIPA” shall have the meaning specified in Article 22(a) of this Agreement.

“Spot Rate” shall mean, as of any date of determination, the Pound Sterling/U.S.
dollar spot rate determined by Buyer at or about 11:00 a.m. New York Time such
date of determination as obtained from the applicable screen on Bloomberg.

“Subordinate Eligible Assets” shall mean Eligible Assets described in items
(ii) and (iii) of the definition of Eligible Assets.

“Subordinate Financing” shall have the meaning set forth in Article 28(a).

“Subordinated Creditor’s Security Agreement” shall mean an agreement creating
security over Subordinated Debt as security for a Foreign Mortgage Loan.

“Subordinated Debt” shall mean any shareholder or other affiliated debt that is
advanced to a Foreign Obligor in connection with (and in accordance with the
terms of) a Foreign Mortgage Loan.

“Subsidiary” shall mean, as to any Person, a corporation, partnership or other
entity of which shares of stock or other ownership interests having ordinary
voting power (other than stock or such other ownership interests having such
power only by reason of the happening of a contingency) to elect a majority of
the board of directors or other managers of such corporation, partnership or
other entity are at the time owned, or the management of which is otherwise
Controlled, directly or indirectly through one or more intermediaries, or both,
by such Person. Unless otherwise qualified, all references to a “Subsidiary” or
to “Subsidiaries” in this Agreement shall refer to a Subsidiary or Subsidiaries
of a Seller.

“Survey” shall mean a certified ALTA/ACSM (or applicable state standards for the
state in which the collateral is located) survey of the underlying real estate
directly or indirectly securing or supporting such Purchased Asset prepared by a
registered independent surveyor or engineer and in form and content satisfactory
to Buyer and the company issuing the Title Policy for such Property; or, in
relation to Purchased Assets relating to Underlying Mortgaged Property located
in England and Wales, a valuation of such Underlying Mortgaged Property by a
valuer prepared on the basis of the market value as that term is defined in the
then current Statements of Asset Valuation Practice and Guidance Notes issued by
the Royal Institution of Chartered Surveyors in form and content satisfactory to
Buyer.

“Taxes” shall mean all forms of 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, fines, surcharges, costs, charges, additions to tax or penalties
applicable thereto.

 

27

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

“Title Company” shall mean a nationally-recognized title insurance company
reasonably acceptable to Buyer.

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

“Transaction” shall mean a Transaction, as specified in Article 1 of this
Agreement and shall include any related Additional Purchase Transaction and any
related Future Funding Transaction.

“Transaction Documents” shall mean, collectively, this Agreement, any applicable
Schedules, Exhibits and Annexes to this Agreement, the Guarantee Agreement, the
Custodial Agreement, the Fee Letter, each Servicing Agreement, each Depository
Agreement, the Pledge Agreement, all Hedging Transactions and all Confirmations
and assignment documentation executed pursuant to this Agreement in connection
with specific Transactions.

“Transfer” shall mean, with respect to any Person, any sale or other whole or
partial conveyance of all or any portion of such Person’s assets, or any direct
or indirect interest therein to a third party (other than in connection with the
transfer of a Purchased Asset by the applicable Seller to Buyer in accordance
herewith).

“Transfer Certificate” shall mean, with respect to a Foreign Mortgage Loan, any
form of transfer or substitution certificate or assignment agreement that is
scheduled to the related loan agreement for such Foreign Mortgage Loan and that
is used to effect the legal transfer of such Foreign Mortgage Loan.

“Transferee” shall have the meaning set forth in Article 17(a) hereof.

“Trust Receipt” shall mean a trust receipt issued by Custodian to Buyer
confirming the Custodian’s possession of certain Purchased Asset Files that 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 or such other counsel or other third party acceptable to Buyer in its
sole discretion.

“UCC” shall have the meaning specified in Article 6(i) of this Agreement.

“Underlying Mortgage Loan” shall mean, with respect to any Senior Mortgage Loan
or Junior Mortgage Loan that is a participation interest or any Mezzanine Loan,
a mortgage loan made in respect of the related Underlying Mortgaged Property.

“Underlying Mortgaged Property” shall mean, in the case of:

(i) a Senior Mortgage Loan, the mortgaged property securing such Senior Mortgage
Loan, or the mortgaged property securing the mortgage loan in which such Senior
Mortgage Loan represents a senior participation interest, as applicable;

(ii) a Junior Mortgage Loan, the mortgaged property securing such Junior
Mortgage Loan, or the mortgaged property securing the mortgage loan in which
such Junior Mortgage Loan represents a junior participation interest, as
applicable, and

 

28

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

(iii) a Mezzanine Loan, the mortgaged property that is owned by the Person the
equity of which is pledged as collateral security for such Mezzanine Loan.

“Underwriting Issues” shall mean, with respect to any Purchased Asset as to
which a Seller intends to request a Transaction, Additional Purchase Transaction
or Future Funding Transaction, all material information Known by any Seller
that, based on the making of reasonable inquiries and the exercise of reasonable
care and diligence under the circumstances, would be considered a materially
“negative” factor (either separately or in the aggregate with other
information), or a material defect in loan documentation or closing deliveries
(such as any absence of any material Purchased Asset Document(s)), to a
reputable nationally recognized institutional mortgage buyer in determining
whether to originate or acquire the Purchased Asset in question.

“U.S. Person” means a “United States person” within the meaning of
Section 7701(a)(30) of the Code.

“U.S. Purchased Assets” means a Purchased Asset with respect to which the
Underlying Mortgaged Property is located in any state of the United States of
America.

“U.S. Seller” shall have the meaning specified in the Recitals of this
Agreement.

“U.S. Tax Compliance Certificate” shall have the meaning assigned to such term
in Article 3(r)(ii)(B)(3).

“VAT” shall mean (a) any tax, interest or penalties imposed in compliance with
the European Council directive of 28 November 2006 on the common system of value
added tax (EC Directive 2006/112) (including, in relation to the United Kingdom,
value added tax imposed by the Value Added Tax Act 1994 and supplemental
legislation and regulations as amended from time to time); and (b) any other
tax, interest or penalties of a similar or equivalent nature, whether imposed in
a member state of the European Union in substitution for, or levied in addition
to, such tax referred to in paragraph (a) above, or elsewhere.

All references to articles, schedules and exhibits are to articles, schedules
and exhibits in or to this Agreement unless otherwise specified. The words
“hereof,” “herein” and “hereunder” and words of similar import when used in this
Agreement shall refer to this Agreement as a whole and not to any particular
provision of this Agreement. All accounting terms not specifically defined
herein shall be construed in accordance with generally accepted accounting
principles. References to “good faith” in this Agreement shall mean “honesty in
fact in the conduct or transaction concerned”.

ARTICLE 3.

INITIATION; CONFIRMATION; TERMINATION;

FEES; EXTENSION OF MATURITY DATE; EXTENSION OF REPURCHASE DATE

Buyer’s agreement to enter into the initial Transaction hereunder is subject to
the satisfaction, immediately prior to or concurrently with the making of such
Transaction, of all of the following items, each of which shall be satisfactory
in form and substance to Buyer and its counsel:

 

29

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

(a) The following documents, delivered to Buyer:

(i) this Agreement, duly completed and executed by each of the parties hereto
(including all exhibits hereto);

(ii) the Guarantee Agreement, duly completed and executed by each of the parties
thereto;

(iii) the Custodial Agreement, duly executed and delivered by each of the
parties thereto;

(iv) the Depository Agreements, duly completed and executed by each of the
parties thereto;

(v) prior to the consummation of any Purchased Asset Transaction, the Interim
Servicing Agreements, duly completed and executed by each of the parties
thereto;

(vi) the Pledge Agreement, duly completed and executed by each of the parties
thereto;

(vii) any and all consents and waivers applicable to each Seller or to the
Purchased Assets;

(viii) UCC financing statements for filing in each of the UCC filing
jurisdictions described on Exhibit XII hereto, each naming Sellers as “Debtors”
and Buyer as “Secured Party” and adequately describing as “Collateral” all of
the items set forth in the definition of Purchased Items in this Agreement,
together with any other documents necessary or requested by Buyer to perfect the
security interests granted by Sellers in favor of Buyer with respect to all
relevant jurisdictions, including without limitation England and Wales, under
this Agreement or any other Transaction Document such that the lien created in
favor of Buyer is senior to the claim of any other creditor of any Seller or
Affiliate of any Seller;

(ix) any documents relating to any Hedging Transactions;

(x) opinions of outside counsel to Sellers reasonably acceptable to Buyer
(including, but not limited to, those relating to bankruptcy safe harbor,
enforceability, corporate matters, applicability of the Investment Company Act
of 1940 to Sellers or any Affiliate of either Seller, and security interests
under the laws of the applicable states of the United States) and from outside
counsel to Buyer with respect to similar matters relating to England and Wales;

(xi) good standing certificates and certified copies of the charters and by-laws
(or equivalent documents) of each Seller, Parent and Guarantor and of all
corporate or

 

30

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

other authority for each Seller, Parent and Guarantor with respect to the
execution, delivery and performance of the Transaction Documents and each other
document to be delivered by each Seller, Parent and Guarantor from time to time
in connection herewith (and Buyer may conclusively rely on such certificate
until it receives notice in writing from the applicable Seller to the contrary);

(xii) with respect to any Eligible Asset to be purchased hereunder on the
related Purchase Date that is not serviced by a Seller, the applicable Seller
shall have provided to Buyer a copy of the related Servicing Agreement,
certified as a true, correct and complete copy of the original, together with a
Servicer Notice, fully executed by each Seller and Servicer;

(xiii) Buyer shall have received payment from Sellers of an amount equal to the
amount of actual costs and expenses, including, without limitation, the
reasonable fees and expenses of outside counsel to Buyer, incurred by Buyer in
connection with the development, preparation and execution of this Agreement,
the other Transaction Documents and any other documents prepared in connection
herewith or therewith;

(xiv) prior to the consummation of any Purchased Asset Transaction, an opinion
of outside counsel to Sellers relating to the enforceability of the Interim
Servicing Agreements in a form consistent with the opinion delivered by Seller’s
counsel in accordance with the Other Repurchase Agreement;

(xv) prior to the consummation of any Purchased Asset Transaction, an amendment
to the Other Repurchase Agreement in form and substance reasonably acceptable to
Buyer relating to the cross-collateralization and cross-default of the Other
Repurchase Agreement to this Agreement; and

(xvi) all such other and further documents, documentation and legal opinions as
Buyer in its commercially reasonable discretion shall reasonably require.

(b) Buyer’s agreement to enter into each Transaction (including the initial
Transaction) is subject to the satisfaction of the following further conditions
precedent, both immediately prior to entering into such Transaction and also
after giving effect to the consummation thereof and the intended use of the
proceeds of the sale:

(i) the sum of (A) the unpaid Repurchase Price for all prior outstanding
Transactions and (B) the requested Maximum Purchase Price for the pending
Transaction, in each case, shall not exceed the Maximum Facility Amount.

(ii) no Market Disruption Event or Force Majeure Event has occurred and is
continuing, no Margin Deficit exists, and no Default or Event of Default has
occurred and is continuing under this Agreement or any other Transaction
Document.

(iii) the applicable Seller shall have paid to Buyer (x) the Purchased Asset Fee
then due and payable with respect to such Transaction pursuant to the Fee Letter
and (y) Buyer’s out-of-pocket costs and expenses pursuant to Article 28(e) of
this Agreement (which amounts referred to in the preceding sub-clauses (x) and
(y) may be paid through a holdback to the Purchase Price) and any other amounts
then due and owing to Buyer under this Agreement.

 

31

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

(iv) the applicable Seller shall give Buyer, prior to 10:00 a.m. New York time
and at least two (2) Business Days prior to the proposed Purchase Date, written
notice of each Transaction (including the initial Transaction), together with a
signed, written confirmation in the form of Exhibit I attached hereto prior to
each Transaction (a “Confirmation”). Each Confirmation shall describe the terms
of the Transaction, the Purchased Assets, shall identify Buyer and the
applicable Seller and shall be executed by both Buyer and the applicable Seller
(provided, that, in instances where funds are being wired to an account other
than account number 483024227101 at Bank of America, account name “Blackstone
Mortgage Trust, Inc.”, ABA # 026009593, the Confirmation shall be signed by two
(2) Responsible Officers of the applicable Seller); provided, however, that
Buyer shall not be liable to the applicable Seller if it inadvertently acts on a
Confirmation that has not been signed by a Responsible Officer of the applicable
Seller, and shall set forth (among other things):

(A) the Purchase Date for the Purchased Assets included in the Transaction;

(B) the Purchase Price and Maximum Purchase Price for the Purchased Assets
included in the Transaction;

(C) the Repurchase Date for the Purchased Assets included in the Transaction;

(D) the requested Advance Rate and Maximum Advance Rate for the Purchased Assets
included in the Transaction;

(E) the amount of any Additional Purchase Amount or Future Funding Amount
requested;

(F) the Market Value and LTV of the Purchased Asset and the Underlying Mortgaged
Property as of the Purchase Date;

(G) the Applicable Spread;

(H) the currency denomination for the Purchased Asset;

(I) with regard to any U.S. Purchased Asset, the Spot Rate determined by Buyer
on the Purchase Date; and

(J) any additional terms or conditions not inconsistent with this Agreement and
mutually agreed upon by Buyer and the applicable Seller.

No Confirmation may be amended unless in a writing executed by Buyer and the
applicable Seller. Neither (i) changes in the Repurchase Price related to a
Purchased Asset due to the application of Principal Proceeds nor (ii) periodic
adjustments to LIBOR

 

32

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

related to a Purchased Asset shall require an amendment to the related
Confirmation; provided, however, that the funding of any Additional Purchase
Amount or Future Funding Amount shall require an amended and restated
Confirmation.

(v) Buyer shall have the right to review the Eligible Assets a Seller proposes
to sell to Buyer in any Transaction and to conduct its own due diligence
investigation of such Eligible Assets as Buyer determines (each, “Asset Due
Diligence”). Buyer shall be entitled to make a determination, in the exercise of
its sole discretion, that, in the case of a Transaction, it shall or shall not
purchase any or all of the assets proposed to be sold to Buyer by the applicable
Seller. On the Purchase Date for the Transaction, which shall be not less than
two (2) Business Days following the final approval of an Eligible Asset by Buyer
in accordance with Exhibit VIII hereto, the Eligible Assets shall be transferred
to Buyer or the Custodian on Buyer’s behalf against the transfer of the Purchase
Price to an account of the applicable Seller. Buyer shall inform such Seller of
its determination with respect to any such proposed Transaction solely in
accordance with Exhibit VIII attached hereto. Upon the approval by Buyer of a
particular proposed Transaction, Buyer shall deliver to the related Seller a
signed copy of the related Confirmation (which shall not be binding upon such
Seller until it is signed and delivered by such Seller and shall not be binding
upon Buyer until it is signed and delivered by Buyer) described in clause
(iv) above, on or before the scheduled date of the underlying proposed
Transaction. Prior to the approval of each proposed Transaction by Buyer, as
applicable:

(A) Buyer shall have (i) determined, in its sole and absolute discretion, that
the asset proposed to be sold to Buyer by the applicable Seller in such
Transaction is an Eligible Asset and (ii) determined conformity to the terms of
the Transaction Documents, Buyer’s internal credit and underwriting criteria,
and (iii) obtained internal credit approval, to be granted or denied in Buyer’s
sole and absolute discretion, for the inclusion of such Eligible Asset as a
Purchased Asset in a Transaction, without regard for any prior credit decisions
by Buyer or any Affiliate of Buyer, and with the understanding that Buyer shall
have the absolute right to change any or all of its internal underwriting
criteria at any time, without notice of any kind to such Seller;

(B) Buyer shall have fully completed all external legal due diligence;

(C) Buyer shall have determined the Pricing Rate applicable to the Transaction
(including the Applicable Spread) in accordance with Schedule I attached to the
Fee Letter (as adjusted by Buyer on a case by case basis in its sole discretion)
hereto or as otherwise agreed by Buyer and the applicable Seller;

(D) no Market Disruption Event or Force Majeure Event has occurred and is
continuing, no Margin Deficit exists, and no Default or Event of Default has
occurred and is continuing under this Agreement or any other Transaction
Document;

(E) the applicable Seller shall have delivered to Buyer a list of all exceptions
to the representations and warranties relating to the Purchased Asset and any
other eligibility criteria for such Purchased Asset of which such Seller has
Knowledge (the “Requested Exceptions Report”);

 

33

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

(F) Buyer shall have waived in writing all exceptions in the Requested
Exceptions Report;

(G) both immediately prior to the requested Transaction and also after giving
effect thereto and to the intended use thereof, the representations and
warranties made by the applicable Seller in each of Exhibit VI and Article 9, as
applicable, shall be true, correct and complete on and as of such Purchase Date
in all respects with the same force and effect as if made on and as of such date
(or, if any such representation or warranty is expressly stated to have been
made as of a specific date, as of such specific date);

(H) subject to Buyer’s right to perform one or more due diligence reviews
pursuant to Article 26, Buyer shall have completed its due diligence review of
the Purchased Asset File, and such other documents, records, agreements,
instruments, mortgaged properties or information relating to such Purchased
Asset as Buyer in its sole discretion deems appropriate to review and such
review shall be satisfactory to Buyer in its sole discretion and Buyer has
consented in writing (including by signing the related Confirmation) to the
Eligible Asset becoming a Purchased Asset;

(I) with respect to any Eligible Asset to be purchased hereunder on the related
Purchase Date that is not serviced by the applicable Seller or an Affiliate
thereof, such Seller shall have provided to Buyer a copy of the related
Servicing Agreement, certified as a true, correct and complete copy of the
original, together with a Servicer Notice, fully executed by Seller and the
servicer named in the related Servicing Agreement;

(J) the applicable Seller, regardless of whether this Agreement is executed,
shall have paid to Buyer all legal fees and expenses of outside counsel actually
incurred by Buyer in connection with the entering into of any Transaction,
including, without limitation, costs associated with due diligence, recording or
other administrative expenses necessary or incidental to the execution of any
Transaction hereunder, which amounts, at Buyer’s option, may be withheld from
the sale proceeds of any Transaction hereunder;

(K) Buyer shall have determined in accordance with this Agreement that no Margin
Deficit shall exist, either immediately prior to or after giving effect to the
requested Transaction;

(L) on each Purchase Date Buyer shall have received, in the case of a “Table
Funded” Transaction, a Bailee Letter and, from Custodian, an Asset Schedule and
Exception Report (as defined in the Custodial Agreement) and a Trust Receipt and
with respect to each Purchased Asset, dated the Purchase Date, duly completed
and with exceptions acceptable to Buyer in its sole discretion in respect of
Eligible Assets to be purchased hereunder on such Business Day;

 

34

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

(M) Buyer shall have received from the applicable Seller a Release Letter
covering each Eligible Asset to be sold to Buyer;

(N) Buyer shall have reasonably determined that no introduction of, or a change
in, any Requirement of Law or in the interpretation or administration of any
Requirement of Law applicable to Buyer has made it unlawful, and no Governmental
Authority shall have asserted that it is unlawful, for Buyer to enter into
Transactions;

(O) the Repurchase Date for such Transaction is not later than the Maturity
Date;

(P) the applicable Seller shall have taken such other action as Buyer shall have
reasonably requested in order to transfer the Purchased Assets pursuant to this
Agreement and to perfect all security interests granted under this Agreement or
any other Transaction Document in favor of Buyer with respect to the Purchased
Assets;

(Q) with respect to any Eligible Asset to be purchased hereunder, if such
Eligible Asset was acquired by the applicable Seller, such Seller shall have
disclosed to Buyer the acquisition cost of such Eligible Asset (including
therein reasonable supporting documentation required by Buyer, if any);

(R) Buyer shall have received all such other and further documents,
documentation and legal opinions (including, without limitation, opinions
regarding the perfection of Buyer’s security interests) as Buyer in its
reasonable discretion shall reasonably require;

(S) Buyer shall have received a copy of any documents relating to any Hedging
Transaction, and the applicable Seller shall have pledged and assigned to Buyer,
pursuant to Article 6 hereunder, all of such Seller’s rights under each Hedging
Transaction included within a Purchased Asset, if any;

(T) no “Termination Event”, “Event of Default”, “Potential Event of Default” or
any similar event by the applicable Seller, however defined therein, shall have
occurred and be continuing under any Hedging Transaction required to be assigned
hereunder; and

(U) the counterparty to the applicable Seller in any Hedging Transaction shall
be an Affiliated Hedge Counterparty or a Qualified Hedge Counterparty, and, in
the case of a Qualified Hedge Counterparty, in the event that such counterparty
no longer qualifies as a Qualified Hedge Counterparty, then, at the election of
Buyer, such Seller shall ensure that such counterparty posts additional
collateral in an amount satisfactory to Buyer under all its Hedging Transactions
with such Seller, or such Seller shall immediately terminate the Hedging
Transactions with such counterparty and enter into new Hedging Transactions with
a Qualified Hedge Counterparty.

 

35

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

(c) Upon the satisfaction of all conditions set forth in Articles 3(a) and (b),
the applicable Seller shall sell, transfer, convey and assign to Buyer on a
servicing-released basis all of such Seller’s right, title and interest in and
to each Purchased Asset, together with all related Servicing Rights against the
transfer of the Purchase Price to an account of such Seller (which Purchase
Price shall be funded in the currency denominated on the applicable
Confirmation). 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 the
Pricing Rate Determination Date for each of the next succeeding Pricing Rate
Periods 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 in Buyer’s sole and
absolute discretion, and notify such Seller in writing two (2) Business Days
prior to the next Pricing Rate Period of such Pricing Rate for such period.
Notwithstanding any other provision herein or in any other Transaction Document,
Buyer shall not be obligated to enter into any Transaction or purchase any Asset
and may terminate a Transaction at any time for any or no reason until such time
as Buyer has executed and delivered a Confirmation and funded the Purchase Price
with respect to any Transaction.

(d) Each Confirmation, together with this Agreement, shall be conclusive
evidence of the terms of the Transaction(s) covered thereby. In the event of any
conflict between the terms of such Confirmation and the terms of this Agreement,
other than with respect to the Advance Rate or the applicable Price Differential
set forth in the related Confirmation, the Confirmation shall prevail.

(e) On the Repurchase Date (including any Early Repurchase Date) for any
Transaction, termination of the Transaction will be effected by (A) payment by
the applicable Seller to Buyer of an amount equal to the sum of (1) the
Repurchase Price for the applicable Purchased Asset and (2) any other amounts
then due and payable under this Agreement (including, without limitation,
Article 3(g)), any other Transaction Documents, and any related Hedging
Transactions with respect to such Purchased Asset and (B) transfer to such
Seller of the Purchased Asset being repurchased and any Income in respect
thereof received by Buyer (and not previously credited or transferred to, or
applied to the obligations of, such Seller pursuant to Article 5 of this
Agreement). In the event that a Purchased Asset is repurchased as of the date
set forth in clause (vi) of the definition of Repurchase Date, the settlement of
the payment of the Repurchase Price and other amounts due in connection with the
repurchase of such Purchased Asset pursuant to this Article 3(e) shall occur no
later than two (2) Business Days after such Repurchase Date. For the avoidance
of doubt, until such settlement occurs and such amounts are paid, all rights of
Buyer with respect to the applicable Purchased Asset, including all liens and
security interests granted in favor of Buyer in connection therewith, shall
continue in full force and effect.

(f) The applicable Seller shall be entitled to terminate a Transaction on demand
and repurchase the Purchased Asset sold by such Seller and subject to a
Transaction (an “Early Repurchase”) on any Business Day prior to the Repurchase
Date (an “Early Repurchase Date”); provided, however, that:

 

36

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

(i) such Seller notifies Buyer in writing of its intent to terminate such
Transaction and repurchase such Purchased Asset, setting forth the Early
Repurchase Date and identifying with particularity the Purchased Asset to be
repurchased on such Early Repurchase Date, no later than three (3) Business Days
prior to such Early Repurchase Date (unless such Early Repurchase is in
connection with curing a Margin Deficit or breach of any representation or
warranty set forth in Exhibit VI, or in connection with any of the events
described in Article 3(h) having occurred, in which case such notice shall not
be required);

(ii) on such Early Repurchase Date, such Seller pays to Buyer an amount equal to
the sum of (A) the Repurchase Price for the applicable Purchased Asset and
(B) any other amounts due and payable under this Agreement (including, without
limitation, Article 3(g)) and under any related Hedging Transactions with
respect to such Purchased Asset against transfer to such Seller or its agent of
such Purchased Assets;

(iii) on such Early Repurchase Date, in addition to the amounts set forth in
subclause (ii) above, such Seller pays to Buyer, on account of all other
Purchased Assets then subject to Transactions, an amount sufficient to reduce
the Purchase Price for each such Purchased Asset to an amount equal to the
Buyer’s Margin Amount for each such Purchased Asset; and

(iv) such Early Repurchase does not cause such Seller to violate the covenant
set forth in Article 10(k) hereof.

(g) If prior to the first day of any Pricing Rate Period with respect to any
Transaction, (i) Buyer shall have determined in the exercise of its reasonable
business judgment (which determination shall be conclusive and binding upon the
applicable Seller) that, by reason of circumstances affecting the relevant
market, adequate and reasonable means do not exist for ascertaining LIBOR for
such Pricing Rate Period, or (ii) LIBOR determined or to be determined for such
Pricing Rate Period will not adequately and fairly reflect the cost to Buyer (as
determined and certified by Buyer) of making or maintaining Transactions during
such Pricing Rate Period, Buyer shall give written notice (which may be by
email) thereof to Sellers as soon as practicable thereafter. If such notice is
given, the Pricing Rate with respect to such Transaction for such Pricing Rate
Period, and for any subsequent Pricing Rate Periods until such notice has been
withdrawn by Buyer, shall be a per annum rate equal to the Federal Funds Rate
plus the Applicable Spread (the “Alternative Rate”).

(h) Notwithstanding any other provision herein, if the adoption of or any change
in any Requirement of Law or in the interpretation of any such Requirement of
Law or the application thereof shall make it unlawful (a “Change in Law”) for
Buyer to enter into or maintain Transactions as contemplated by the Transaction
Documents, (a) the commitment of Buyer hereunder to enter into new Transactions,
Future Funding Transactions or Additional Purchase Transactions and to continue
Transactions as such shall forthwith be canceled, and (b) if a Change in Law
makes it unlawful to maintain Transactions with a Pricing Rate based on LIBOR,
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 that is not

 

37

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

the last day of the then current Pricing Rate Period with respect to such
Transaction, the applicable Seller shall pay to Buyer such amounts, if any, as
may be required pursuant to Article 3(i) of this Agreement.

(i) Upon written demand by Buyer, each Seller shall, jointly and severally,
indemnify Buyer and hold Buyer harmless from any actual out-of-pocket loss, cost
or expense (including, without limitation, reasonable attorneys’ fees and
disbursements of outside counsel) that Buyer may sustain or incur as a
consequence of (i) default by any Seller in repurchasing any Purchased Asset
after any Seller has given written notice in accordance with Article 3(f) of an
Early Repurchase, (ii) any payment of the Repurchase Price on any day other than
a Remittance Date, including Breakage Costs, (iii) a default by any Seller in
selling Eligible Assets after such Seller has notified Buyer of a proposed
Transaction and Buyer has agreed in writing to purchase such Eligible Assets in
accordance with the provisions of this Agreement, (iv) Buyer’s enforcement of
the terms of any of the Transaction Documents, (v) any actions taken to perfect
or continue any Lien created under any Transaction Documents, and/or (vi) Buyer
entering into any Transaction or any of the Transaction Documents or owning any
Purchased Item. A certificate as to such costs, losses, damages and expenses,
setting forth the calculations therefor shall be submitted promptly in writing
by Buyer to Sellers and shall be prima facie evidence of the information set
forth therein.

(j) If the adoption of or any change in any Requirement of Law or Buyer
Compliance Policy or in the interpretation of any such Requirement of Law or
Buyer Compliance Policy, the application thereof or the compliance therewith, or
the compliance by Buyer with any request or directive (whether or not having the
force of law) from any central bank or other Governmental Authority having
jurisdiction over Buyer, in each case whether by a Governmental Authority, by
Buyer or by a corporation controlling Buyer:

(i) shall subject Buyer to any Taxes (other than (A) Indemnified Taxes,
(B) Taxes described in clauses (b) through (d) of the definition of Excluded
Taxes and (C) Connection Income Taxes) on its loans, loan principal, letters of
credit, commitments, or other obligation, or its deposits, reserves, other
liabilities or capital attributable thereto;

(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 that is not
otherwise included in the determination of LIBOR hereunder; or

(iii) shall impose on Buyer any other condition;

and the result of any of the foregoing is to increase the cost to Buyer, by an
amount that Buyer deems to be material, of entering into, continuing or
maintaining Transactions, Additional Purchase Transactions or Future Funding
Transactions or to reduce any amount receivable under the Transaction Documents
in respect thereof; then, in any such case, Sellers shall promptly pay Buyer,
upon its demand, any additional amounts necessary to compensate Buyer for such
increased cost or reduced amount receivable. Such notification as to the
calculation of any additional amounts payable pursuant to this Article 3(j)
shall be submitted by Buyer to Sellers

 

38

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

and shall be prima facie evidence of such additional amounts. This covenant
shall survive the termination of this Agreement and the repurchase by Sellers of
any or all of the Purchased Assets.

(k) If Buyer shall have determined that the adoption of or any change in any
Requirement of Law or Buyer Compliance Policy made subsequent to the date hereof
regarding capital adequacy or otherwise affecting the Buyer Funding Costs, or in
the interpretation of any such Requirement of Law or Buyer Compliance Policy,
the application thereof or the compliance therewith, in each case whether by a
Governmental Authority, by Buyer or by any corporation controlling Buyer
(including, without limitation, any request or directive regarding capital
adequacy or otherwise affecting the Buyer Funding Costs (whether or not having
the force of law) from any Governmental Authority or any Buyer Compliance Policy
related to such request or directive), does or shall have the effect of reducing
the rate of return on Buyer’s or such corporation’s capital as a consequence of
any one or more of the Transactions, Additional Purchase Transactions or Future
Funding Transactions or otherwise as a consequence of its obligations under the
Transaction Documents to a level below that which Buyer or such corporation
could have achieved, but for such adoption, change, interpretation, application
or compliance, by an amount that Buyer deems, in the exercise of its reasonable
business judgment, to be material, then, from time to time, after submission by
Buyer to Sellers of a written request therefor, Sellers shall pay to Buyer such
additional amount or amounts as will reimburse Buyer for the actual damages,
losses, costs and expenses incurred by Buyer in connection with each such
reduction; provided that Buyer has then-currently made the same determination
with respect to a similarly situated repurchase customer in a situation where
Buyer has similar contractual rights. Such notification as to the calculation of
any additional amounts payable pursuant to this subsection shall be submitted by
Buyer to Seller and shall be prima facie evidence of such additional
amounts. This covenant shall survive the termination of this Agreement and the
repurchase by Sellers of any or all of the Purchased Assets.

(l) If either Seller repurchases Purchased Assets on a day other than the last
day of a Pricing Rate Period, such Seller shall indemnify Buyer and hold Buyer
harmless from any actual out-of-pocket losses, costs and/or expenses which Buyer
sustains as a direct consequence thereof (“Breakage Costs”), in each case for
the remainder of the applicable Pricing Rate Period. Buyer shall deliver to such
Seller a written statement setting forth the amount and basis of determination
of any Breakage Costs in reasonable detail, it being agreed that such statement
and the method of its calculation shall be conclusive and binding upon such
Seller absent manifest error. This Article 3(l) shall survive termination of
this Agreement and the repurchase of all Purchased Assets subject to
Transactions hereunder.

(m) [Reserved]

(n) Any and all payments by or on account of any obligation of either Seller
under this Agreement or any other 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 by a withholding agent, then the applicable withholding agent shall
be entitled to make such deduction or withholding and shall timely pay 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

 

39

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

sum payable by the applicable Seller to the applicable Buyer or Assignee shall
be increased as necessary so that after such deduction or withholding has been
made (including such deductions and withholdings applicable to additional sums
payable under this Article 3(n) or Article 3(o)) the applicable Buyer or
Assignee receives an amount equal to the sum it would have received had no such
deduction or withholding been made.

(o) Each Seller shall timely pay (i) any Other Taxes imposed on such Seller to
the relevant Governmental Authority in accordance with Applicable Law, and
(ii) any Other Taxes imposed on the Buyer or Assignee upon written notice from
such Person setting forth in reasonable detail the calculation of such Other
Taxes.

(p) As soon as practicable after any payment of Taxes by a Seller to a
Governmental Authority pursuant to Article 3(o) or Article 3(q), such Seller
shall deliver to Buyer or Assignee, as applicable, the original or a certified
copy of a receipt issued by such Governmental Authority evidencing such payment,
a copy of the return reporting such payment or other evidence of such payment
reasonably satisfactory to Buyer or Assignee, as applicable.

(q) Each Seller shall indemnify Buyer and each Assignee, 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 Article 3(o) or this Article 3(q)) payable or paid by
Buyer or such Assignee or required to be withheld or deducted from a payment to
such Buyer or Assignee and any reasonable out-of-pocket 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;
provided that no payment shall be required under this Article 3(q) for any claim
for Indemnified Taxes that were paid by Buyer or such Assignee two hundred and
seventy (270) or more days prior to the date of such claim. A certificate
setting forth in reasonable detail the calculation of the amount of such payment
or liability delivered to such Seller by Buyer or such Assignee shall be
conclusive absent manifest error.

(r)(i) Any Buyer and any Assignee that is entitled to an exemption from or
reduction of withholding Tax with respect to payments made under any Transaction
Document shall deliver to Sellers, at the time or times reasonably requested by
Sellers, such properly completed and executed documentation reasonably requested
by Sellers as will permit such payments to be made without withholding or at a
reduced rate of withholding. In addition, Buyer or Assignee, if reasonably
requested by Sellers, shall deliver such other documentation prescribed by
Applicable Law or reasonably requested by Sellers as will enable Sellers to
determine whether or not Buyer or Assignee is subject to backup withholding or
information reporting requirements. Notwithstanding anything to the contrary in
the preceding two sentences, the completion, execution and submission of such
documentation (other than such documentation set forth in clauses (ii)(A),
(ii)(B), (ii)(D) and (iii) below) shall not be required if in Buyer’s or
Assignee’s reasonable judgment such completion, execution or submission would
subject Buyer or such Assignee to any material unreimbursed cost or expense or
would materially prejudice the legal or commercial position of Buyer or such
Assignee.

 

40

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

(ii) Without limiting the generality of the foregoing,

(A) Buyer and any Assignee that is a U.S. Person shall deliver to Sellers on or
prior to the date on which Buyer or such Assignee acquires an interest under any
Transaction Document (and from time to time thereafter upon the reasonable
request of Sellers), executed originals of IRS Form W-9 certifying that Buyer
and such Assignee is exempt from U.S. federal backup withholding tax;

(B) any Foreign Buyer shall, to the extent it is legally entitled to do so,
deliver to Sellers (in such number of copies as shall be requested by the
recipient) on or prior to the date on which such Foreign Buyer acquires an
interest under this Agreement (and from time to time thereafter upon the
reasonable request of Sellers), whichever of the following is applicable:

(1) in the case of a Foreign Buyer claiming the benefits of an income tax treaty
to which the United States is a party (x) with respect to payments of interest
under this Agreement, executed originals of IRS Form W-8BEN establishing an
exemption from, or reduction of, U.S. federal withholding Tax pursuant to the
“interest” article of such tax treaty and (y) with respect to any other
applicable payments under any Transaction Document, IRS Form W-8BEN establishing
an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the
“business profits” or “other income” article of such tax treaty;

(2) executed originals of IRS Form W-8ECI;

(3) in the case of a Foreign Buyer claiming the benefits of the exemption for
portfolio interest under Section 881(c) of the Code, (x) a certificate
substantially in the form of Exhibit XI-1 to the effect that such Foreign Buyer
is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a “10
percent shareholder” of a Seller within the meaning of Section 881(c)(3)(B) of
the Code, or a “controlled foreign corporation” described in
Section 881(c)(3)(C) of the Code (a “U.S. Tax Compliance Certificate”) and
(y) executed originals of IRS Form W-8BEN; or

(4) to the extent a Foreign Buyer is not the beneficial owner, executed
originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN, a
U.S. Tax Compliance Certificate substantially in the form of Exhibit XI-2 or
Exhibit XI-3, IRS Form W-9, and/or other certification documents from each
beneficial owner, as applicable; provided that if the Foreign Buyer is a
partnership and one or more direct or indirect partners of such Foreign Buyer
are claiming the portfolio interest exemption, such Foreign Buyer may provide a
U.S. Tax Compliance Certificate substantially in the form of Exhibit XI-4 on
behalf of each such direct and indirect partner;

 

41

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

(C) any Foreign Buyer shall, to the extent it is legally entitled to do so,
deliver to the applicable Seller (in such number of copies as shall be requested
by the recipient) on or prior to the date on which such Foreign Buyer acquires
an interest under this Agreement (and from time to time thereafter upon the
reasonable request of Seller), executed originals of any other form prescribed
by Applicable Law as a basis for claiming exemption from or a reduction in U.S.
federal withholding Tax, duly completed, together with such supplementary
documentation as may be prescribed by Applicable Law to permit such Seller to
determine the withholding or deduction required to be made; and

(D) if a payment made to Buyer or Assignee under any Transaction Document would
be subject to U.S. federal withholding Tax imposed by FATCA if Buyer or Assignee
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), Buyer or such Assignee shall deliver to the applicable Seller at
the time or times prescribed by law and at such time or times reasonably
requested by such 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 such Seller as may be necessary
for such Seller to comply with its obligations under FATCA and to determine that
Buyer or such Assignee has complied with Buyer’s or such Assignee’s obligations
under FATCA or to determine the amount to deduct and withhold from such payment.
Solely for purposes of this clause (D), “FATCA” shall include any amendments
made to FATCA after the date of this Agreement.

(iii) Buyer and each Assignee agrees that if any form or certification described
in items (A), (B), (C) or (D) above it previously delivered expires or becomes
obsolete or inaccurate in any respect, it shall update such form or
certification or promptly notify the applicable Seller in writing of its legal
inability to do so.

(s) 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 Article 3(o) or, Article 3(q) (including by the payment of
additional amounts pursuant to Article 3(i)), it shall pay to the indemnifying
party an amount equal to such refund (but only to the extent of indemnity
payments made under Article 3(i), Article 3(o) and/or Article 3(q) with respect
to the Taxes giving rise to such refund), net of all reasonable 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 Article 3(s) (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 Article 3(s), in no event will the indemnified
party be required to pay any amount to an indemnifying party pursuant to this
Article 3(s) 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 paragraph 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.

 

42

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

(t)(i) Notwithstanding anything to the contrary in any Transaction Document, all
amounts payable by any Seller to Buyer and/or any Assignee under a Transaction
Document, that (in whole or in part) constitute consideration for a supply or
supplies for VAT purposes shall be deemed to be exclusive of any VAT that is
chargeable on such supply or supplies. Subject to Article 3(t)(ii), if VAT is or
becomes chargeable on any supply made by Buyer and/or any Assignee to a Seller
under a Transaction Document, with respect to a Foreign Purchased Asset only,
such Seller shall pay Buyer and/or Assignee (in addition to, and at the same
time as, paying the consideration for such supply) an amount equal to the amount
of the VAT and Buyer and/or relevant Assignee shall promptly provide an
appropriate VAT invoice to such Seller.

(ii) Where a Transaction Document, with respect to a Foreign Purchased Asset
only, requires a Seller to reimburse Buyer and/or any Assignee for any costs or
expenses, such Seller shall, at the same time, reimburse and indemnify Buyer
and/or any relevant Assignee for the full amount of all VAT incurred by Buyer
and/or such Assignee in respect of those costs or expenses. The amount payable
pursuant to this subclause shall be the amount that Buyer and/or any relevant
Assignee reasonably determines is the amount that it is not entitled to claim as
a VAT credit or VAT repayment from the relevant tax authority in respect of the
VAT.

(u) Each party’s obligations under clauses (n) through (s) of this Article 3
shall survive any assignment of rights by, or the replacement of, Buyer or
Assignee, the termination of the Agreement and the repayment, satisfaction or
discharge of all obligations under this Agreement.

(v) If any Buyer or Assignee requests compensation under Article 3 or, if a
Seller is required to pay any Indemnified Taxes or additional amounts to any
Buyer or any Assignee or any Governmental Authority for the account of any Buyer
or Assignee pursuant to Article 3(i), Article 3(o) or Article 3(q), or if any
Buyer or Assignee defaults in its obligations under this Agreement, then Sellers
may, at their sole expense and effort, upon notice to such Buyer or Assignee,
require such Buyer or Assignee to assign and delegate, without recourse (in
accordance with and subject to the restrictions contained in Article 17), all
its interests, rights (other than its existing rights to payments pursuant to
Articles 3(g) or 3(i)) and obligations under this Agreement to an assignee that
shall assume such obligations (which assignee may be another Buyer, if a Buyer
accepts such assignment); provided that (i) such Buyer shall have received
payment of an amount equal to the Repurchase Price for all Transactions, Price
Differential accreted with respect thereto, accrued fees and all other amounts
payable to it hereunder, from the assignee (to the extent of such outstanding
Repurchase Price principal and accreted Price Differential and fees) or Sellers
(in the case of all other amounts) and (ii) in the case of any such assignment
resulting from a claim for compensation under Article 3(i) or payments required
to be made pursuant to Article 3(g), such assignment will result in a reduction
in such compensation or payments. A Buyer or Assignee shall not be required to
make any such assignment and delegation if, prior thereto, as a result of a
waiver by such Buyer or Assignee or otherwise, the circumstances entitling
Sellers to require such assignment and delegation cease to apply.

 

43

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

(w) If at any time prior to the Maturity Date, a non-use fee or other similar
charge is assessed against Buyer internally, Sellers shall, monthly on demand
from Buyer, provided that Buyer has then-currently made the same determination
with respect to a similarly situated repurchase customer in a situation where
Buyer has similar contractual rights, reimburse Buyer for the exact amount of
each such fee, as and when originally assessed, with each such assessment and
payment to be in addition to the monthly Price Differential payments otherwise
due in accordance with the applicable provisions of this Agreement.

(x)(i) If there exists Additional Purchase Available Amount with respect to a
Purchased Asset, the related Seller may submit to Buyer a request that Buyer
increase the Purchase Price for such Purchased Asset in an amount requested by
such Seller, which amount shall be no less than £153,037 or, with respect to
U.S. Purchased Assets, the then-current equivalent of such amount based on the
Spot Rate in the Applicable Currency and shall not exceed the Additional
Purchase Available Amount as of the proposed date for such increase to the
Purchase Price for such Purchased Asset (each such transaction, an “Additional
Purchase Transaction” and the amount so funded with respect to each Additional
Purchase Transaction, the “Additional Purchase Amount”). Notwithstanding the
foregoing, such Seller may not request, and Buyer shall not be obligated to pay,
any Additional Purchase Amount unless no uncured Margin Deficit, Force Majeure
Event, Default or Event of Default has occurred and is continuing or would
result from the funding of such Additional Purchase Transaction. Upon delivery
of a request by a Seller for an Additional Purchase Transaction, and Buyer’s
satisfaction that all terms and conditions set forth in this Article 3(x) have
been complied with (including, without limitation, those in the immediately
preceding sentence), Buyer shall, within one (1) Business Day following such
Seller’s request therefore, provided that for Foreign Purchased Assets only if
Buyer receives such Seller’s request prior to 10:00 a.m. New York time, pay the
Additional Purchase Amount for each such Additional Purchase Transaction. In
connection with any such Additional Purchase Transaction, Buyer and such Seller
shall execute and deliver to each other an updated Confirmation setting forth
the new outstanding Purchase Price with respect to such
Transaction. Notwithstanding the above or any other provision in this Agreement,
to the extent that the Purchase Price of any Purchased Asset is reduced by the
related Seller pursuant to Article 3(z) of this Agreement to an amount that is
less than fifty percent (50%) of the Maximum Purchase Price of such Purchased
Asset, the Additional Purchase Available Amount with respect to such Purchased
Asset shall thereafter (unless Buyer, in its sole discretion, determines not to
apply the following reduction) be reduced by the amount equal to the difference
between (i) fifty percent (50%) of the Maximum Purchase Price of such Purchased
Asset and (ii) the Purchase Price of such Purchased Asset following the
application of such reduction to the Purchase Price pursuant to Article 3(z)
which causes the Purchase Price to be less than fifty percent (50%) of the
Maximum Purchase Price.

(ii) Buyer’s agreement to enter into any Additional Purchase Transaction with
respect to any Purchased Asset is further subject to the satisfaction, in
Buyer’s reasonable discretion, of the following conditions precedent (the
“Additional Purchase Transaction Conditions Precedent”):

(A) Buyer shall have determined the Pricing Rate applicable to the related
Transaction (including the Applicable Spread) in accordance with Schedule I
attached to the Fee Letter or as otherwise agreed by Buyer and the applicable
Seller;

 

44

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

(B) no uncured Margin Deficit, Force Majeure Event, Default or Event of Default
has occurred and is continuing or would result from the funding of such
Additional Purchase Transaction;

(C) both immediately prior to the requested Additional Purchase Transaction and
also after giving effect thereto and to the intended use thereof, the
representations and warranties made by the applicable Seller in each of Exhibit
VI and Article 9, as applicable, shall be true, correct and complete on and as
of the date of such Additional Purchase Transaction in all respects with the
same force and effect as if made on and as of such date (or, if any such
representation or warranty is expressly stated to have been made as of a
specific date, as of such specific date) except to the extent disclosed in a
Requested Exceptions Report previously accepted by Buyer; and

(D) the sum of (A) the unpaid Repurchase Price for all outstanding Transactions
and (B) the requested Additional Purchase Amount, shall not exceed the Maximum
Facility Amount as of such date.

(iii) In connection with any such Additional Purchase Transaction, Buyer and the
applicable Seller shall execute and deliver to each other an updated
Confirmation setting forth the new outstanding Purchase Price with respect to
such Transaction.

(iv) No decision on the part of Buyer to enter into an Additional Purchase
Transaction or the advance of any Additional Purchase Amount shall be deemed to
be a waiver of any covenant, representation or warranty or other obligation of
such Seller contained herein.

(y)(i) A Seller may request a Future Funding Transaction by giving Buyer written
notice thereof together with a written Confirmation signed by an officer of such
Seller (a “Future Funding Confirmation”) prior to 10:00 a.m. New York time at
least two (2) Business Days prior to the proposed Future Funding Date. Buyer
shall be entitled to make a determination, in the exercise of its sole and
absolute discretion, that, in the case of a Future Funding Transaction, it shall
or shall not enter into the Future Funding Transaction, and notwithstanding any
other provision herein, Buyer shall have no obligation to enter into any Future
Funding Transaction. If Buyer determines it will enter into a Future Funding
Transaction and that the Future Funding Transaction Conditions Precedent have
been satisfied with respect to the applicable Future Funding Transaction in its
sole and absolute discretion, Buyer shall deliver to the related Seller a
countersigned copy of the related Future Funding Confirmation on or before the
Future Funding Date for the proposed Future Funding Transaction. On the Future
Funding Date for the applicable Future Funding Transaction, funds in the amount
stated in the Future Funding Confirmation (the “Future Funding Amount”) shall be
transferred by Buyer to the Purchased Asset’s underlying obligor. Each Future
Funding Confirmation, together with this Agreement, shall be conclusive evidence
of the terms of the Future Funding Transaction covered thereby. If terms in a
Future Funding Confirmation are inconsistent with terms in this Agreement with
respect to a particular Future Funding Transaction, the Future Funding
Confirmation shall prevail.

 

45

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

(ii) While Buyer and each Seller hereby acknowledge and agree that it is not
intended that Buyer re-underwrite each Purchased Asset in connection with a
Future Funding Transaction request, any Seller requesting a Future Funding
Transaction shall provide Buyer with all confirmatory or updated documentation
that is reasonably requested by Buyer in connection with Buyer’s evaluation of
the Future Funding Transaction for the related Purchased Asset as Buyer
reasonably determines to be necessary and appropriate and Buyer shall conduct
such additional diligence based on such information as Buyer determines to be
necessary or appropriate and such Seller shall provide Buyer such additional
information with respect to such due diligence as Buyer may reasonably request.

(iii) Buyer’s agreement to enter into any Future Funding Transaction with
respect to any Purchased Asset is subject to the satisfaction, in Buyer’s
reasonable discretion, of the following conditions precedent (the “Future
Funding Transaction Conditions Precedent”):

(A) if, in connection with the entry into the initial Transaction relating to
the Purchased Asset that is the subject of a Future Funding Transaction, Buyer
and the applicable Seller agreed upon additional conditions precedent which are
required to be satisfied with respect to such Purchased Asset and that are
specified in the related Future Funding Confirmation, then such additional
conditions precedent have been satisfied;

(B) Buyer shall have (i) determined, in its sole and absolute discretion, that
the related Purchased Asset is an Eligible Asset and (ii) determined conformity
to the terms of the Transaction Documents, Buyer’s internal credit and
underwriting criteria, and (iii) obtained internal credit approval, to be
granted or denied in Buyer’s sole and absolute discretion, for the Future
Funding Transaction, without regard for any prior credit decisions by Buyer or
any Affiliate of Buyer, and with the understanding that Buyer shall have the
absolute right to change any or all of its internal underwriting criteria at any
time, without notice of any kind to the applicable Seller;

(C) Buyer shall have fully completed all external due diligence as discussed in
clause (ii) above;

(D) Buyer shall have determined the Pricing Rate applicable to the related
Transaction (including the Applicable Spread) in accordance with Schedule I
attached to the Fee Letter (as adjusted by Buyer on a case by case basis in its
sole discretion) hereto or as otherwise agreed by Buyer and the applicable
Seller;

 

46

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

(E) no Material Adverse Effect or Force Majeure Event shall have occurred, no
Margin Deficit shall exist, and no Default or Event of Default under this
Agreement shall have occurred and be continuing;

(F) both immediately prior to the requested Future Funding Transaction and also
after giving effect thereto and to the intended use thereof, the representations
and warranties made by the applicable Seller in each of Exhibit VI and
Article 9, as applicable, shall be true, correct and complete on and as of the
date of such Future Funding Transaction in all respects with the same force and
effect as if made on and as of such date (or, if any such representation or
warranty is expressly stated to have been made as of a specific date, as of such
specific date);

(G) the LTV of the related Purchased Asset taking into account the requested
advance of the Future Funding Amount is no greater than the LTV of the related
Purchased Asset as of the Purchase Date;

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

(I) the Future Funding Amount shall be equal to or greater than $250,000;

(J) the sum of (A) the unpaid Repurchase Price for all outstanding Transactions
and (B) the requested Future Funding Amount shall not exceed the Maximum
Facility Amount as of such date;

(K) the applicable Seller shall have delivered to Buyer a certification that all
conditions precedent to the future funding obligation under the Purchased Asset
documentation have been satisfied in all material respects and provided Buyer
with any evidence or documentation thereto Buyer may request;

(L) the applicable Seller shall have paid to Buyer all legal fees and expenses
of outside counsel actually incurred by Buyer in connection with the entering
into of the Future Funding Transaction, including, without limitation, costs
associated with due diligence, recording or other administrative expenses
necessary or incidental to the execution of the Future Funding Transaction,
which amounts, at Buyer’s option, may be withheld from the sale proceeds of the
Future Funding Transaction;

(M) on the date of the Future Funding Transaction Buyer shall have received, in
the case of a “Table Funded” Transaction, a Bailee Letter and, from Custodian,
an Asset Schedule and Exception Report (as defined in the Custodial Agreement)
and a Trust Receipt and with respect to each Purchased Asset, dated the Purchase
Date, duly completed and with exceptions acceptable to Buyer in its sole
discretion in respect of Eligible Assets to be purchased hereunder on such
Business Day;

 

47

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

(N) Buyer shall have received from the applicable Seller a Release Letter
covering the related Purchased Asset;

(O) Buyer shall have reasonably determined that no introduction of, or a change
in, any Requirement of Law or in the interpretation or administration of any
Requirement of Law applicable to Buyer has made it unlawful, and no Governmental
Authority shall have asserted that it is unlawful, for Buyer to enter into
Future Funding Transactions;

(P) the Repurchase Date for the related Transaction is not later than the
Maturity Date;

(Q) the applicable Seller shall have taken such other action as Buyer shall have
reasonably requested in order to transfer the Purchased Assets pursuant to this
Agreement and to perfect all security interests granted under this Agreement or
any other Transaction Document in favor of Buyer with respect to the Purchased
Assets;

(R) Buyer shall have received all such other and further documents,
documentation and legal opinions (including, without limitation, opinions
regarding the perfection of Buyer’s security interests) as Buyer in its
reasonable discretion shall reasonably require;

(S) Buyer shall have received a copy of any documents relating to any Hedging
Transaction, and the applicable Seller shall have pledged and assigned to Buyer,
pursuant to Article 6 hereunder, all of such Seller’s rights under each Hedging
Transaction included within a Purchased Asset, if any;

(T) no “Termination Event”, “Event of Default”, “Potential Event of Default” or
any similar event by either Seller, however defined therein, shall have occurred
and be continuing under any Hedging Transaction required to be assigned
hereunder;

(U) the counterparty to the applicable Seller in any Hedging Transaction shall
be an Affiliated Hedge Counterparty or a Qualified Hedge Counterparty, and, in
the case of a Qualified Hedge Counterparty, in the event that such counterparty
no longer qualifies as a Qualified Hedge Counterparty, then, at the election of
Buyer, such Seller shall ensure that such counterparty posts additional
collateral in an amount satisfactory to Buyer under all its Hedging Transactions
with such Seller, or such Seller shall immediately terminate the Hedging
Transactions with such counterparty and enter into new Hedging Transactions with
a Qualified Hedge Counterparty; and

(V) the applicable Seller shall pay to Buyer on the Future Funding Date the
Purchased Asset Fee attributable to the Future Funding Amount.

(iv) If Buyer determines, in accordance with Article 3(y)(i) that the Future
Funding Transaction Conditions Precedent have not been satisfied (or otherwise
waived

 

48

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

by Buyer in its sole discretion), and that Buyer shall not advance the Future
Funding Advance requested by the applicable Seller, then, on any Business Day
thereafter, such Seller may elect, in its sole discretion, to repurchase the
related Purchased Asset.

(v) No decision on the part of Buyer to enter into a Future Funding Transaction
or the advance of any Future Funding Amount shall be deemed to be a waiver of
any covenant, representation or warranty or other obligation of any Seller
contained herein.

(z) On any Business Day prior to the Repurchase Date, the applicable Seller
shall have the right, from time to time, to transfer cash to Buyer for the
purpose of reducing the outstanding Purchase Price of, but not terminating, a
Transaction and without the release of any Purchased Items; provided, that
(i) 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 (A) all
unpaid accrued Price Differential as of the applicable Business Day on the
amount of such reduction and (B) any other amounts due and payable by such
Seller under this Agreement and under any related Hedging Transactions with
respect to such Purchased Asset, (ii) such transfer of cash to Buyer shall be in
an amount no less than £612,145 or, with respect to U.S. Purchased Assets, the
then-current equivalent of such amount based on the Spot Rate in the Applicable
Currency, (iii) the applicable Seller shall provide Buyer with three
(3) Business Days prior notice with respect to a reduction in outstanding
Purchase Price in an amount greater than £3,060,725 or, with respect to U.S.
Purchased Assets, the then-current equivalent of such amount based on the Spot
Rate in the Applicable Currency, occurring on any date that is not a Remittance
Date; and (iv) with respect to Foreign Purchased Assets only, such Seller shall
deliver a revised, executed Confirmation no later than 10:00 a.m. New York time
at least two (2) Business Days prior to the proposed Purchase Price
reduction. In connection with any such reduction of outstanding Purchase Price
pursuant to this Article 3(z), Buyer and such Seller shall execute and deliver
to each other an updated Confirmation setting forth the new outstanding Purchase
Price with respect to such Transaction.

ARTICLE 4.

MARGIN MAINTENANCE

(a) If at any time (x) Buyer’s Margin Amount for all U.S. Purchased Assets is
less than the aggregate Purchase Price outstanding for all U.S. Purchased Assets
and/or (y) Buyer’s Margin Amount for all Foreign Purchased Assets is less than
the aggregate Purchase Price outstanding for all Foreign Purchased Assets (in
each case, a “Margin Deficit”), then Buyer may by written notice (which may be
in electronic form) delivered to Sellers in the form of Exhibit X (a “Margin
Deficit Notice”) require Sellers to, at Sellers’ option, to the extent such
Margin Deficit equals or exceeds the Minimum Transfer Amount, (i) repurchase
some or all of the related Purchased Assets at their respective Repurchase
Prices, (ii) make a payment in reduction of the Repurchase Price of some or all
of such Purchased Assets in immediately available funds, (iii) deliver
collateral in the form of cash or Cash Equivalents, or (iv) choose any
combination of the foregoing, such that, after giving effect to such transfers,
repurchases and payments, Buyer’s Margin Amount for all the related Purchased
Assets shall be equal to or greater than the aggregate Repurchase Price for all
the related Purchased Assets. In connection with the delivery of cash or Cash
Equivalents in accordance with clause (iii) above, Sellers shall deliver to
Buyer

 

49

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

any additional documents (including, without limitation, to the extent not
covered by any previously delivered legal opinions, one or more opinions of
counsel reasonably satisfactory to Buyer) and take any actions reasonably
necessary in Buyer’s discretion for Buyer to have a first priority, perfected
security interest in such cash or Cash Equivalents, as applicable. With respect
to clauses (i) and (ii) above, such payments and/or repurchases shall be made by
the related Seller in the Applicable Currency of the related Purchased Asset.

(b) If a Margin Deficit Notice is given by Buyer under Article 4(a) of this
Agreement on any Business Day at or prior to the Margin Notice Deadline, Sellers
shall cure the related Margin Deficit as provided in Article 4(a) prior to 5:00
p.m. New York time no later than one (1) Business Day following the day such
Margin Deficit Notice is given by Buyer. If any Margin Deficit Notice is given
by Buyer on any Business Day at any time after the Margin Notice Deadline,
Sellers shall cure the related Margin Deficit as provided in Article 4(a) by no
later than prior to 5:00 p.m. New York time no later than two (2) Business Days
following the day such Margin Deficit Notice is given by Buyer.

(c) The failure of Buyer, on any one or more occasions, to exercise its rights
hereunder, 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.
Sellers and Buyer each agree that a failure or delay by Buyer to exercise its
rights hereunder shall not limit or waive Buyer’s rights under this Agreement or
otherwise existing by law or in any way create additional rights for Sellers.

ARTICLE 5.

INCOME PAYMENTS AND PRINCIPAL PROCEEDS

(a) Each Depository Account shall be established at the Depository and shall be
subject to the applicable Depository Agreement concurrently with the execution
and delivery of this Agreement by Sellers and Buyer. Pursuant to each Depository
Agreement, Buyer shall have sole dominion and control (including “control”
within the meaning of the UCC (as defined in Section 6(i) below)) over the
related Depository Account. Each Depository Account shall at all times be
subject to the related Depository Agreement. All Income or other amounts in
respect of the Purchased Assets, as well as any interest received from the
reinvestment of such Income or other amounts, shall be deposited directly by the
applicable Mortgagor into the applicable Depository Account in accordance with
the Re-direction Letter. Depository shall then apply such Income in accordance
with the applicable provisions of Articles 5(c) through 5(e) of this Agreement.

(b) Contemporaneously with the sale to Buyer of any Purchased Asset, Sellers
shall deliver to each Mortgagor, issuer of a participation interest, servicer
and paying agent or similar Person (however described) with respect to each
Purchased Asset or borrower under a Purchased Asset an irrevocable direction
letter substantially in the form of Exhibit XVI (the “Re-direction Letter”),
instructing, as applicable, the Mortgagor, issuer of a participation interest,
servicer, trustee or similar Person (however described) with respect to such
Purchased Asset or borrower (as applicable) to pay all amounts payable under the
related Purchased Asset into the applicable Depository Account. If a Mortgagor,
issuer of a participation interest, servicer, paying agent or similar Person
(however described) with respect to the Purchased Asset or borrower forwards any
Income or other amounts with respect to a Purchased Asset to either Seller or
any Affiliate

 

50

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

of a Seller rather than directly into the applicable Depository Account, such
Seller shall, or shall cause such Affiliate to, (i) deliver an additional
Re-direction Letter to the applicable Mortgagor, issuer of a participation
interest, servicer or paying agent with respect to the Purchased Asset or
borrower and make other reasonable best efforts to cause such Mortgagor, issuer
of a participation interest, servicer or paying agent with respect to the
Purchased Asset or borrower to forward such amounts directly to the applicable
Depository Account and (ii) deposit in the applicable Depository Account any
such amounts within one (1) Business Day of such Seller’s (or its Affiliate’s)
receipt thereof.

(c) So long as no Event of Default with respect to any Purchased Asset shall
have occurred and be continuing, all Income or other amounts received by the
Depository in respect of any Purchased Asset (other than Principal Proceeds)
during each Collection Period shall be applied by the Depository on the related
Remittance Date in the following order of priority:

(i) first, (i) to the Custodian for payment of the document custodian fees
payable to Custodian pursuant to the Custodian Agreement, then (ii) to the
Depository for payment of fees payable to the Depository in connection with each
Depository Account and then (iii) to the Interim Servicer for payment of the
loan servicing fees payable monthly to the Interim Servicer pursuant plus the
reasonable out-of-pocket costs and expenses, in each case, as required under the
applicable Interim Servicing Agreement as in effect from time to time;

(ii) second, pro rata, (A) to Buyer, an amount equal to the Price Differential
that has accreted and is outstanding as of such Remittance Date and (B) to any
Affiliated Hedge Counterparty, any amount then due and payable to an Affiliated
Hedge Counterparty under any Hedging Transaction related to a Purchased Asset;

(iii) third, to Buyer, an amount equal to any other amounts then due and payable
to Buyer or its Affiliates under any Transaction Document (including any
outstanding Margin Deficits);

(iv) fourth, to make a payment to Other Facility Buyer or its Affiliates on
account of any other amounts then due and payable under the Other Facility
pursuant to Article 5(c)(i), (ii) and (iii) of the Other Repurchase Agreement
until such other amounts then due and payable pursuant to Article 5(c)(i),
(ii) and (iii) of the Other Repurchase Agreement have been reduced to zero, each
such payment to be deposited into the Depository Account (as defined in the
Other Repurchase Agreement) and allocated in accordance with the Other
Repurchase Agreement; and

(v) fifth, to the applicable Seller, the remainder, if any.

Notwithstanding the foregoing, so long as any Default has occurred and is
continuing, but has not become an Event of Default, all amounts remaining in
each Depository Account on each Remittance Date after application to clauses
(i) through (iii) above shall remain in such Depository Account until such
Default has either (x) been cured to Buyer’s satisfaction, in which case such
remaining amounts shall be distributed to the applicable Seller pursuant to
clause (iv) above, or (y) has matured into an Event of Default, in which case
such remaining amounts shall be distributed pursuant to Article 5(e) below.

 

51

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

(d) So long as no Event of Default with respect to any Purchased Asset shall
have occurred and be continuing, any Principal Proceeds shall be applied by the
Depository on the Business Day following the Business Day on which such funds
are deposited in the applicable Depository Account in the following order of
priority:

(i) first, pro rata, (A) to Buyer, until the Purchase Price for such Purchased
Asset has been reduced to the Buyer’s Margin Amount for such Purchased Asset as
of the date of such payment (as determined by Buyer after giving effect to such
Principal Proceeds and application of net sales proceeds, if applicable) and
(B) solely with respect to any Hedging Transaction with an Affiliated Hedge
Counterparty related to such Purchased Asset, to such Affiliated Hedge
Counterparty an amount equal to any accrued and unpaid breakage costs or
termination payments under such Hedging Transaction related to such Purchased
Asset;

(ii) second, to Buyer, an amount equal to any other amounts due and owing to
Buyer or its Affiliates under any Transaction Document (including any
outstanding Margin Deficits);

(iii) third, to make a payment to Other Facility Buyer or its Affiliates on
account of any other amounts then due and payable under the Other Facility
pursuant to Article 5(d)(i) and (ii) of the Other Repurchase Agreement until
such other amounts then due and payable pursuant to Article 5(d)(i) and (ii) of
the Other Repurchase Agreement have been reduced to zero, each such payment to
be deposited into the Depository Account (as defined in the Other Repurchase
Agreement) in accordance with the Other Repurchase Agreement;

(iv) fourth, to the applicable Seller, the remainder of such Principal Proceeds.

Notwithstanding the foregoing, so long as any Default has occurred and is
continuing, but has not become an Event of Default, all amounts remaining in
each Depository Account on each Remittance Date after application to clauses
(i) through (ii) above shall remain in such Depository Account until such
Default has either (x) been cured to Buyer’s satisfaction, in which case such
remaining amounts shall be distributed to the applicable Seller pursuant to
clause (iii) above, or (y) has matured into an Event of Default, in which case
such remaining amounts shall be distributed pursuant to Article 5(e) below.

(e) If an Event of Default shall have occurred and be continuing, all Income
(including, without limitation, any Principal Proceeds or any other amounts
received, without regard to their source) or any other amounts received by the
Depository in respect of a Purchased Asset shall be applied by the Depository on
the Business Day next following the Business Day on which such funds are
deposited in the applicable Depository Account in the following order of
priority:

(i) first, (i) to the Custodian for payment of the document custodian fees
payable to Custodian pursuant to the Custodian Agreement, then (ii) to the
Depository for

 

52

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

payment of fees payable to the Depository in connection with each Depository
Account and then (iii) to the Interim Servicer for payment of the loan servicing
fees payable monthly to the Interim Servicer pursuant plus the reasonable
out-of-pocket costs and expenses, in each case, as required under the applicable
Interim Servicing Agreement as in effect from time to time;

(ii) second, pro rata, (A) to Buyer, an amount equal to the Price Differential
that has accreted and is outstanding in respect of all of the Purchased Assets
as of such Business Day and (B) to any Affiliated Hedge Counterparty, any
amounts then due and payable to an Affiliated Hedge Counterparty under any
Hedging Transaction related to such Purchased Asset;

(iii) third, to Buyer, on account of the Repurchase Price of such Purchased
Asset until the Repurchase Price for such Purchased Asset has been reduced to
zero;

(iv) fourth, to Buyer, on account of the Repurchase Price of all Purchased
Assets until the Repurchase Price for all such Purchased Assets has been reduced
to zero;

(v) fifth, to Buyer, an amount equal to any other amounts due and owing to Buyer
or its Affiliates under any Transaction Document;

(vi) sixth, to make a payment to Other Facility Buyer or its Affiliates on
account of the repurchase price of all purchased assets related to the Other
Repurchase Agreement and any other amounts due and owing under the Other
Facility until the repurchase price for such purchased assets and such other
amounts due and owing have been reduced to zero, each such payment to be
deposited into the Depository Account (as defined in the Other Repurchase
Agreement) and allocated in Other Facility Buyer’s sole discretion; and

(vii) seventh, to the applicable Seller, any remainder.

ARTICLE 6.

SECURITY INTEREST

(a) Buyer and each Seller intend that the Transactions hereunder be sales to
Buyer of the Purchased Assets and not loans from Buyer to Sellers secured by the
Purchased Assets. However, in order to preserve Buyer’s rights under this
Agreement in the event that a court or other forum recharacterizes the
Transactions hereunder as loans and as security for the performance by each
Seller of all of such Seller’s obligations to Buyer under the Transaction
Documents and the Transactions entered into hereunder, or in the event that a
transfer of a Purchased Asset is otherwise ineffective to effect an outright
transfer of such Purchased Asset to Buyer, each Seller hereby assigns, pledges
and grants a security interest in all of its right, title and interest in, to
and under the Purchased Items (as defined below) to Buyer to secure the payment
of the Repurchase Price on all Transactions to which it is a party and all other
amounts owing by any Seller or its Affiliates to Buyer and any of Buyer’s
present or future Affiliates hereunder, including, without limitation, amounts
owing pursuant to Article 25, under the other Transaction Documents, including
any obligations of such Seller under any Hedging Transaction

 

53

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

entered into with any Affiliated Hedge Counterparty (including, without
limitation, all amounts anticipated to be paid to Buyer by an Affiliated Hedge
Counterparty as provided for in the definition of Repurchase Price or otherwise)
and the Other Facility Repurchase Obligations, and to secure the obligation of
such Seller or its designee to service the Purchased Assets in conformity with
Article 27 and any other obligation of such Seller to Buyer (collectively, the
“Repurchase Obligations”). Each Seller shall mark its computer records and tapes
to evidence the interests granted to Buyer hereunder. All of each Seller’s
right, title and interest in, to and under each of the following items of
property, whether now owned or hereafter acquired, now existing or hereafter
created and wherever located, is hereinafter referred to as the “Purchased
Items”:

(i) the Purchased Assets and all “securities accounts” (as defined in
Article 8-501(a) of the UCC) to which any or all of the Purchased Assets are
credited;

(ii) any and all interests of each Seller in, to and under the applicable
Depository Account and all monies from time to time on deposit in each
Depository Account;

(iii) any cash or Cash Equivalents delivered to Buyer in accordance with Article
4(a);

(iv) the Purchased Asset Documents, Servicing Agreements, Servicing Records,
Servicing Rights, all servicing fees relating to the Purchased Assets, insurance
policies relating to the Purchased Assets, and collection and escrow accounts
and letters of credit relating to the Purchased Assets;

(v) Each Seller’s right under each Hedging Transaction, if any, relating to the
Purchased Assets to secure the Repurchase Obligations;

(vi) all “general intangibles”, “accounts”, “chattel paper”, “investment
property”, “instruments”, “securities accounts” and “deposit accounts”, each as
defined in the UCC, relating to or constituting any and all of the foregoing;

(vii) any other items, amounts, rights or properties transferred or pledged by a
Seller to Buyer under any of the Transaction Documents; and

(viii) 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.

(b) U.S. Seller hereby assigns, pledges and grants a security interest in all of
its right, title and interest in, to and under the Other Facility Purchased
Items to Buyer to secure the payment of the Repurchase Obligations. U.S. Seller
shall mark its computer records and tapes to evidence the interests granted to
Buyer hereunder.

(c) Foreign Asset Seller also hereby assigns, pledges and grants a security
interest in all of its right, title and interest in, to and under the Purchased
Items to Other Facility Buyer to secure the payment of the Other Facility
Repurchase Obligations. Foreign Asset Seller shall mark its computer records and
tapes to evidence the interests granted to Other Facility Buyer hereunder.

 

54

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

(d) Buyer and Other Facility Buyer each hereby acknowledges and agrees that
(i) Buyer’s security interest in the Other Facility Purchased Items as security
for the Repurchase Obligations shall at all times be junior and subordinate in
all respects to Other Facility Buyer’s security interest in the Other Facility
Purchased Items as security for the Other Facility Repurchase Obligations and
(ii) U.S. Seller is expressly permitted by Other Facility Buyer and Buyer to
enter into this Agreement and the Transaction Documents, and the
representations, warranties and covenants of U.S. Seller under the Other
Repurchase Agreement shall be deemed modified to permit this Agreement and the
transactions contemplated hereby, mutatis mutandis (including, without
limitation, Section 9(b)(xiii), Section 9(b)(xxv), Section 10(d) of the Other
Repurchase Agreement). The preceding subordination of Buyer’s security interest
in the Other Facility Purchased Items affects only the relative priority of
Buyer’s security interest in the Other Facility Purchased Items, and shall not
subordinate the Repurchase Obligations in right of payment to the Other Facility
Repurchase Obligations.

(e) Other Facility Buyer hereby acknowledges and agrees that Other Facility
Buyer’s security interest in the Purchased Items as security for the Other
Facility Repurchase Obligations shall at all times be junior and subordinate in
all respects to Buyer’s security interest in the Purchased Items as security for
the Repurchase Obligations. The preceding subordination of Other Facility
Buyer’s security interest in the Purchased Items affects only the relative
priority of Other Facility Buyer’s security interest in the Purchased Items, and
shall not subordinate the Other Facility Repurchase Obligations in right of
payment to the Repurchase Obligations.

(f) Buyer agrees to act as agent for and on behalf of the Affiliated Hedge
Counterparties (including without limitation for purposes of Sections 9-313(c),
8-106(d)(3), 9-104(a) and 9-106(a) of the UCC) with respect to the security
interest granted hereby to secure the obligations owing to the Affiliated Hedge
Counterparties under any Hedging Transactions, including, without limitation,
with respect to the Purchased Assets and the Purchased Asset Files held by the
Custodian pursuant to the Custodial Agreement.

(g) Buyer agrees to act as agent for and on behalf of Other Facility Buyer
(including without limitation for purposes of Sections 9-313(c), 8-106(d)(3),
9-104(a) and 9-106(a) of the UCC) with respect to the security interest granted
hereby to secure the obligations owing to Other Facility Buyer under the Other
Facility, including, without limitation, with respect to the Purchased Assets
and the Purchased Asset Files held by the Custodian pursuant to the Custodial
Agreement.

(h) Other Facility Buyer agrees to act as agent for and on behalf of Buyer
(including without limitation for purposes of Sections 9-313(c), 8-106(d)(3),
9-104(a) and 9-106(a) of the UCC) with respect to the security interest granted
hereby to secure the obligations owing to Buyer under the Transaction Documents,
including, without limitation, with respect to the “Purchased Assets” and the
“Purchased Asset Files”, each as defined in the Other Repurchase Agreement.

 

55

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

(i) Buyer’s security interest in the Purchased Items and the Other Facility
Purchased Items shall terminate only upon termination of each Seller’s
obligations under this Agreement and the other Transaction Documents, the Other
Facility, all Hedging Transactions and the documents delivered in connection
herewith and therewith. Upon such termination, Buyer shall promptly deliver to
Sellers such UCC termination statements and other release documents as may be
commercially reasonable and return the Purchased Assets to the applicable Seller
and reconvey the Purchased Items to the applicable Seller and release its
security interest in the Purchased Items and the Other Facility Purchased Items.
For purposes of the grant of the security interest pursuant to this Article 6,
this Agreement shall be deemed to constitute a security agreement under the New
York Uniform Commercial Code (the “UCC”). Buyer shall have all of the rights and
may exercise all of the remedies of a secured creditor under the UCC and the
other laws of the State of New York. In furtherance of the foregoing, (a) Buyer,
at Sellers’ sole cost and expense, as applicable, shall cause to be filed in
such locations as may be necessary to perfect and maintain perfection and
priority of the security interest granted hereby, UCC financing statements and
continuation statements (collectively, the “Filings”), and shall forward copies
of such Filings to the applicable Seller upon the filing thereof, and
(b) Sellers 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 (including marking its records
and files to evidence the interests granted to Buyer hereunder). For the
avoidance of doubt, notwithstanding clause (vi) of the definition of Repurchase
Date and the proviso thereto, Buyer’s security interest in any particular
Purchased Asset shall not terminate until each Seller has fully paid the related
Repurchase Price.

(j) Each Seller acknowledges that neither it nor Guarantor has any right to
service the Purchased Assets but only has rights as a party to the Interim
Servicing Agreement or any other servicing agreement with respect to the
Purchased Assets. Without limiting the generality of the foregoing and in the
event that a Seller or Guarantor is deemed to retain any residual Servicing
Rights, and for the avoidance of doubt, each Seller and Guarantor grants,
assigns and pledges to Buyer a security interest in the Servicing Rights and
proceeds related thereto and in all instances, whether now owned or hereafter
acquired, now existing or hereafter created. The foregoing provision is intended
to constitute a security agreement or other arrangement or other credit
enhancement related to the Agreement and Transactions hereunder as defined under
Sections 101(47)(v) and 741(7)(x)(A)(xi) of the Bankruptcy Code.

ARTICLE 7.

PAYMENT, TRANSFER AND CUSTODY

(a) On the Purchase Date for each Transaction, ownership of the Purchased Asset
shall be transferred to Buyer or its designee (including the Custodian) against
the simultaneous transfer of the Purchase Price in immediately available funds
to an account of the applicable Seller specified in the Confirmation relating to
such Transaction and otherwise in accordance with this Agreement.

(b)(i) With respect to each Transaction, the applicable Seller shall deliver or
cause to be delivered to Buyer or its designee the Custodial Delivery
Certificate in the form attached hereto as Exhibit IV, provided, that
notwithstanding the foregoing, upon request of the applicable Seller, Buyer in
its sole but good faith discretion may elect to permit such Seller to make such

 

56

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

delivery by not later than the third (3rd) Business Day after the related
Purchase Date, so long as such Seller causes an Acceptable Attorney, Title
Company or other Person acceptable to Buyer to deliver to Buyer and the
Custodian a Bailee Letter on or prior to such Purchase Date. Subject to
Article 7(c), in connection with each sale, transfer, conveyance and assignment
of a Purchased Asset, on or prior to each Purchase Date with respect to such
Purchased Asset, the applicable Seller shall deliver or cause to be delivered
and released to the Custodian a copy or original of each document as specified
in the Purchased Asset File (as defined in the Custodial Agreement, and
collectively, the “Purchased Asset File”), pertaining to each of the Purchased
Assets identified in the Custodial Delivery Certificate delivered therewith,
together with any other documentation in respect of such Purchased Asset
requested by Buyer, in Buyer’s sole but good faith discretion.

(ii) With respect to each Additional Purchase Transaction and Future Funding
Transaction, the applicable Seller shall deliver or cause to be delivered to
Buyer or its designee an updated Custodial Delivery Certificate that includes
any additional documents delivered and/or executed in connection with any such
Additional Purchase Transaction or Future Funding Transaction, as applicable,
provided, that notwithstanding the foregoing, upon request of the applicable
Seller, Buyer in its sole but good faith discretion may elect to permit such
Seller to make such delivery by not later than the third (3rd) Business Day
after the related date of the Additional Purchase Transaction or Future Funding
Transaction, as applicable, so long as such Seller causes an Acceptable
Attorney, Title Company or other Person acceptable to Buyer to deliver to Buyer
and the Custodian a Bailee Letter on or prior to such date. Subject to
Article 7(c), on or prior to that date of an Additional Purchase Transaction or
Future Funding Transaction, as applicable, such Seller shall deliver or cause to
be delivered and released to the Custodian a copy or original of each additional
document delivered and/or executed in connection with each such Additional
Purchase Transaction or Future Funding Transaction, as applicable, as specified
in the Asset File (as defined in the Custodial Agreement), pertaining to each of
the Purchased Assets identified in the Custodial Delivery Certificate delivered
therewith, together with any other documentation in respect of such Purchased
Asset requested by Buyer, in Buyer’s sole but good faith discretion.

(c) From time to time, each Seller shall forward to the Custodian additional
original documents or additional documents evidencing any assumption,
modification, consolidation or extension of a Purchased Asset approved in
accordance with the terms of this Agreement (including without limitation in
connection with an Additional Purchase Transaction or Future Funding
Transaction), 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 that have been delivered or are being delivered to recording
offices for recording and have not been returned to such Seller in time to
permit their delivery hereunder at the time required, in lieu of delivering such
original documents, such 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. Such
Seller shall deliver such original documents to the Custodian promptly when they
are received. With respect to all of the Purchased Assets delivered by such
Seller to Buyer or its designee (including the Custodian), such Seller shall
execute an omnibus power of attorney substantially in the form of Exhibit V-A or
Exhibit V-B, as applicable, attached hereto irrevocably appointing Buyer its
attorney-in-fact

 

57

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

with full power to take the actions described therein, on the terms and
conditions set forth therein; provided that Buyer agrees not to and shall not
exercise its rights under such power of attorney unless a monetary Default,
material non-monetary Default or an Event of Default has occurred and is
continuing. Notwithstanding the immediately preceding proviso, in the event that
a material non-monetary Default has occurred and is continuing, Buyer agrees it
shall use commercially reasonable efforts to notify such Seller of any action
described above and such Seller shall promptly take such action. Buyer agrees
not to exercise the rights described above under such power of attorney for two
(2) Business Days subsequent to such material non-monetary Default unless
(x) Buyer reasonably believes that Buyer needs to take action sooner in order to
protect its interest in the Purchased Items or (y) a monetary Default or an
Event of Default has occurred and is continuing. If the applicable Seller fails
to complete such action within such two (2) Business Day period, then Buyer
shall, upon notice to such Seller, be entitled to exercise its rights under such
power of attorney, provided that a failure to provide any notice or refrain from
taking any action under this Article 7(c) shall not limit or waive Buyer’s
rights to exercise such rights or invalidate such action or in any way create
any liability whatsoever on the part of Buyer for exercising such rights. Buyer
shall deposit the Purchased Asset Files representing the Purchased Assets, or
direct that the Purchased Asset Files be deposited directly, with the Custodian.
The Purchased Asset Files shall be maintained in accordance with the Custodial
Agreement. If a Purchased Asset File is not delivered to Buyer or its designee
(including the Custodian), such Purchased Asset File shall be held in trust by
such Seller or its designee for the benefit of Buyer as the owner thereof.
Seller or its designee shall maintain a copy of the Purchased Asset File and the
originals of the Purchased Asset File not delivered to Buyer or its designee.
The possession of the Purchased Asset File by a Seller or its designee is at the
will of Buyer for the sole purpose of servicing the related Purchased Asset, and
such retention and possession by such Seller or its designee is in a custodial
capacity only. The books and records (including, without limitation, any
computer records or tapes) of such Seller or its designee shall be marked
appropriately to reflect clearly the sale of the related Purchased Asset to
Buyer. Such Seller or its designee (including the Custodian) shall release its
custody of the Purchased Asset File only in accordance with written instructions
from Buyer, unless such release is required as incidental to the servicing of
the Purchased Assets, is in connection with a repurchase of any Purchased Asset
by such Seller or as otherwise required by law.

(d) Subject to clause (e) below, Buyer hereby grants to the applicable Seller a
revocable option to direct Buyer with respect to the exercise of all voting and
corporate rights with respect to the related Purchased Assets sold by such
Seller and to vote, take corporate actions and exercise any rights in connection
with such Purchased Assets, so long as no monetary Default, material
non-monetary Default, or Event of Default has occurred and is continuing. Such
revocable option is not evidence of any ownership or other interest or right of
either Seller in any Purchased Asset. Upon the occurrence and during the
continuation of (i) a monetary Default, (ii) a material non-monetary Default,
(iii) an Event of Default or (iv) with respect to the exercise of any voting or
corporate rights with respect to the Purchased Assets that could be reasonably
determined to materially impair the Market Value, and in each case subject to
the provisions of the Purchased Asset Documents, the revocable option discussed
above shall be deemed to automatically terminate and Buyer shall be entitled to
exercise all voting and corporate rights with respect to the Purchased Assets
without regard to any Seller’s instructions (including, but not limited to, if
an Act of Insolvency shall occur with respect to any Seller, to the extent any
Seller controls or is entitled to control selection of any servicer, Buyer may

 

58

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

transfer any or all of such servicing to an entity satisfactory to Buyer);
provided further, that with respect to clause (iv) above, Buyer shall use
commercially reasonable efforts to consult in good faith with the applicable
Seller regarding the exercise of any such voting or corporate rights, provided
that a failure by Buyer to consult with such Seller under this Article 7(d)
shall not limit or waive Buyer’s rights to exercise such voting and corporate
rights or invalidate such vote or exercise of rights or in any way create any
liability whatsoever on the part of Buyer for exercising such rights.

(e) Notwithstanding the rights granted to any Seller pursuant to clause
(d) above, the Sellers shall not, and shall not permit the Interim Servicer, the
primary servicer or any other servicer of any Purchased Asset to consent to any
amendments, modifications, waivers, releases, sales, transfers, dispositions or
other resolutions relating to the Purchased Assets (including, with respect to a
Purchased Asset that is a participation interest, relating to the Underlying
Mortgage Loan) (except to the extent contemplated or required by the related
Purchased Asset Documents) including, without limitation, the following actions
set forth in clauses (i) through (v) below, without the prior written consent of
Buyer:

(i) any forbearance, extension or other modification or waiver with respect to
any Purchased Asset;

(ii) the release, discharge or reduction of any: (A) lien on any Underlying
Mortgaged Property or collateral for the related Purchased Asset or Purchased
Item or (B) lien or claim on any letters of credit and other non-cash collateral
that is required to be maintained pursuant to the Purchased Asset Documents or
underlying mortgage loan documents, if any;

(iii) the extension of credit (including increasing the terms of any existing
credit) to any Person with respect to any Purchased Asset or Underlying Mortgage
Loan or Underlying Mortgaged Property;

(iv) any sale or other disposition of any Purchased Asset, Underlying Mortgage
Loan, Underlying Mortgaged Property or any other material property or collateral
related thereto; and

(v) the incurrence of any lien or other encumbrance other than as expressly
created hereunder or under any other Transaction Document.

(f) Notwithstanding the provisions of Article 7(b) above requiring the execution
of the Custodial Delivery Certificate and corresponding delivery of the
Purchased Asset File to the Custodian on or prior to the related Purchase Date,
with respect to each Transaction involving a Purchased Asset that is identified
in the related Confirmation as a “Table Funded” Transaction, the applicable
Seller shall, in lieu of effectuating the delivery of all or a portion of the
Purchased Asset File on or prior to the related Purchase Date: (i) deliver to
the Custodian by facsimile or email on or before the related Purchase Date for
the Transaction copies of: (A) with respect to U.S. Purchased Assets, the
promissory note(s), original stock certificate or Participation Certificate in
favor of such Seller or, with respect to Foreign Purchased Assets, the original
loan agreement and any other evidence of indebtedness, in any case, evidencing
the making of the

 

59

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

Purchased Asset, with such Seller’s endorsement of such instrument to Buyer (in
the case of a U.S. Purchased Asset) or a Transfer Certificate (in the case of a
Foreign Purchased Asset), (B) the mortgage, security agreement or similar item
creating the security interest in the related collateral and the applicable
assignment document evidencing the transfer to Buyer, (C) such other components
of the Purchased Asset File as Buyer may require on a case by case basis with
respect to the particular Transaction, and (D) evidence satisfactory to Buyer
that all documents necessary to perfect such Seller’s (and, by means of
assignment to Buyer on the Purchase Date, Buyer’s) interest in the Purchased
Items for the Purchased Asset, (ii) deliver to Buyer and Custodian a Bailee
Letter from an Acceptable Attorney, Title Company or other Person acceptable to
Buyer on or prior to such Purchase Date, sufficient to establish Buyer’s
ownership and perfected security interest in such Purchased Asset and (iii) not
later than the third (3rd) Business Day following the Purchase Date, deliver to
Buyer the Custodial Delivery Certificate and to the Custodian the entire
Purchased Asset File.

ARTICLE 8.

SALE, TRANSFER, HYPOTHECATION OR PLEDGE OF PURCHASED ASSETS

(a) Title to all Purchased Items shall pass to Buyer on the applicable Purchase
Date, and Buyer shall have free and unrestricted use of all Purchased Items,
subject, however, to the terms of this Agreement. Nothing in this Agreement or
any other Transaction Document shall preclude Buyer from engaging in repurchase
transactions with the Purchased Items or otherwise selling, transferring,
pledging, repledging, hypothecating, or rehypothecating the Purchased Items on
terms and conditions that shall be in Buyer’s discretion, but no such
transaction shall relieve Buyer of its obligations to transfer the related
Purchased Assets to the applicable Seller pursuant to Article 3 of this
Agreement, or of Buyer’s obligation to credit or pay Income to, or apply Income
to the obligations of, the applicable Seller pursuant to Article 5 hereof, or of
Buyer’s obligations pursuant to Article 17.

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

ARTICLE 9.

REPRESENTATIONS AND WARRANTIES

(a) Each Seller and Buyer 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, (v) the execution, delivery and performance of this
Agreement and the

 

60

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

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 and (vi) it has not dealt with any broker,
investment banker, agent, or other Person (other than Buyer or an Affiliate of
Buyer in the case of each Seller) who may be entitled to any commission or
compensation in connection with the sale of Purchased Assets pursuant to any of
the Transaction Documents. On the Purchase Date for any Transaction for the
purchase of any Purchased Assets by Buyer from a Seller and any Transaction
hereunder and covenants that at all times while this Agreement and any
Transaction thereunder is in effect, Buyer and such Seller shall each be deemed
to repeat all the foregoing representations made by it.

(b) In addition to the representations and warranties in subsection (a) above,
each Seller represents and warrants to Buyer and Other Facility Buyer as of the
date of this Agreement and will be deemed to represent and warrant to Buyer and
Other Facility Buyer as of the Purchase Date for the purchase of any Purchased
Assets by Buyer from such Seller and any Transaction thereunder and covenants
that at all times while this Agreement and any Transaction thereunder is in
effect, unless otherwise stated herein:

(i) Organization. Seller is duly organized, validly existing and in good
standing under the laws and regulations of the jurisdiction of Seller’s
incorporation or organization, as the case may be, and is duly licensed,
qualified, and in good standing in every state where such licensing or
qualification is necessary for the transaction of Seller’s business, except
where failure to so qualify could not be reasonably likely to have a Material
Adverse Effect. 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.

(ii) Due Execution; Enforceability. The Transaction Documents have been or will
be duly executed and delivered by Seller, for good and valuable consideration.
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, 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, conditions or
provisions of (A) the organizational documents of Seller, (B) 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, (C) any
judgment or order, writ, injunction, decree or demand of any court applicable to
Seller, or (D) any applicable Requirement of Law applicable to these
Transactions, in the case of clauses (B) or (C) above, to the extent that such
conflict or breach would have a Material Adverse Effect upon Seller’s ability to
perform its obligations hereunder.

 

61

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

(iv) Litigation; Requirements of Law. Except as otherwise disclosed in writing
to Buyer prior to the Closing Date, as of the date hereof and as of the Purchase
Date for any Transaction hereunder, there is no action, suit, proceeding,
investigation, or arbitration pending or, to the Knowledge of Seller, threatened
against Seller, the Guarantor or any of their respective assets, nor is there
any action, suit, proceeding, investigation, or arbitration pending or
threatened against Seller or the Guarantor that is reasonably likely to result
in any Material Adverse Effect. Seller is in compliance in all material respects
with all Requirements of Law. Neither Seller nor the Guarantor is 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) Good Title to Purchased Assets and Other Collateral. Immediately prior to
the purchase of any Purchased Assets by Buyer from Seller, such Purchased Assets
are free and clear of any lien, encumbrance or impediment to transfer (including
any “adverse claim” as defined in Article 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 Assets to Buyer and, upon transfer of
such Purchased Assets to Buyer, Buyer shall be the owner of such Purchased
Assets free of any adverse claim subject to the rights of Seller and obligations
of Buyer under this Agreement or any other Transaction Document in each case
except for (1) Liens to be released simultaneously with the sale to Buyer
hereunder and (2) Liens granted by Seller in favor of the counterparty to any
Hedging Transaction, solely to the extent such liens are expressly subordinate
to the rights and interests of Buyer hereunder. If, notwithstanding the above, a
court or forum recharacterizes the Transaction as a loan, the provisions of this
Agreement (together (in relation to any Foreign Purchased Asset) 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 Purchased Items and Buyer shall have a valid, perfected first priority
security interest in the Purchased Items free of any adverse claim subject to
the rights of Seller and obligations of Buyer under this Agreement or any other
Transaction Document (and without limitation on the foregoing, Buyer, as
entitlement holder, shall have a “security entitlement” to the Purchased
Assets).

(vi) No Adverse Effect; No Default or Event of Default. As of the related
Purchase Date and the date of each Future Funding Transaction and Additional
Purchase Transaction, Seller has no Knowledge of any facts or circumstances that
are reasonably likely to have a material adverse effect on any Purchased Asset
or Underlying Mortgaged Property. No Default or Event of Default has occurred or
exists under or with respect to the Transaction Documents.

(vii) Authorized Representatives. The duly authorized representatives of Seller
are listed on, and true signatures of such authorized representatives are set
forth on, Exhibit II attached to this Agreement.

 

62

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

(viii) Representations and Warranties Regarding Purchased Assets; Delivery of
Purchased Asset File.

(A) As of the date hereof, Seller has not assigned, pledged, or otherwise
conveyed or encumbered any Purchased Items to any other Person, and immediately
prior to the sale of, or grant of a security interest in, the Purchased Items
to, or in favor of, Buyer.

(B) The provisions of this Agreement and the related Confirmation are effective
to either constitute a sale of Purchased Items to Buyer or to create in favor of
Buyer a legal, valid and enforceable security interest in all right, title and
interest of Seller in, to and under the Purchased Items.

(C) With respect to the U.S. Purchased Assets, upon receipt by the Custodian of
each Mortgage Note, Mezzanine Note or Participation Certificate, endorsed in
blank by a duly authorized officer of Seller, either a purchase shall have been
completed by Buyer of such Mortgage Note, Mezzanine Note or Participation
Certificate, as applicable, or Buyer shall have a valid and fully perfected
first priority security interest in all right, title and interest of Seller in
the Purchased Items described therein; and with respect to the Foreign Purchased
Assets, upon receipt by the Custodian of Buyer of a Transfer Certificate or
Participation Certificate, endorsed in blank by a duly authorized officer of the
applicable Seller and each Foreign Assignment Agreement executed by a duly
authorized officer of such Seller either a purchase shall have been completed by
Buyer of the relevant Foreign Purchased Asset or the Participation Certificate,
as applicable, or Buyer shall have a valid and fully perfected first priority
security interest in all right, title and interest of such Seller in the
Purchased Items described therein.

(D) Each of the representations and warranties made in respect of the Purchased
Assets pursuant to Exhibit VI are true, complete and correct, except to the
extent disclosed in a Requested Exceptions Report previously accepted by Buyer.

(E) Upon the filing of financing statements on Form UCC-1 naming Buyer as
“Secured Party”, Seller as “Debtor” and describing the Purchased Items in the
jurisdiction and filing office listed on Exhibit XII attached hereto, the
security interests granted hereunder in that portion of the Purchased Items
which can be perfected by filing under the UCC will constitute fully perfected
security interests under the UCC in all right, title and interest of Seller in,
to and under such Purchased Items.

(F) Upon execution and delivery of each Depository Agreement, Buyer shall either
be the owner of, or have a valid and fully perfected first priority security
interest in, the related Depository Account and all amounts at any time on
deposit therein.

 

63

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

(G) Upon execution and delivery of each Depository Agreement, Buyer shall either
be the owner of, or have a valid and fully perfected first priority security
interest in, the “investment property” and all “deposit accounts” (each as
defined in the UCC) comprising Purchased Items or any after-acquired property
related to such Purchased Items. Except to the extent disclosed in a Requested
Exceptions Report, Seller or its designee is in possession of a complete, true
and accurate Purchased Asset File with respect to each Purchased Asset, except
for such documents the originals of which have been delivered to the Custodian.

(ix) Adequate Capitalization; No Fraudulent Transfer. Seller has, as of such
Purchase Date, adequate capital for the normal obligations foreseeable in a
business of its size and character and in light of its contemplated business
operations. Seller is generally able to pay, and as of the date hereof is
paying, its debts as they come due. Seller has not become, or 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.

(x) No Conflicts or Consents. Neither the execution and delivery of this
Agreement and the other Transaction Documents by Seller, nor the consummation of
any of the transactions by it herein or therein contemplated, nor compliance
with the terms and provisions hereof or with the terms and provisions thereof,
will contravene or conflict with or result in the creation or imposition of (or
the obligation to create or impose) any lien upon any of the property or assets
of Seller pursuant to the terms of any indenture, mortgage, deed of trust, or
other agreement or instrument to which Seller is a party or by which Seller may
be bound, or to which Seller may be subject, other than liens created pursuant
to the Transaction Documents. No consent, approval, authorization, or order of
any third party is required in connection with the execution and delivery by
Seller of the Transaction Documents to which it is a party or to consummate the
transactions contemplated hereby or thereby which has not already been obtained
(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) Governmental Approvals. No order, consent, approval, license, authorization
or validation of, or filing, recording or registration by Seller with, or
exemption by, any Governmental Authority is required to authorize, or is
required in connection with, (A) the execution, delivery and performance of any
Transaction Document to which Seller is or will be a party, (B) the legality,
validity, binding effect or enforceability of any such Transaction Document
against Seller or (C) the consummation of the transactions contemplated by this
Agreement (other than consents, approvals and filings that have been obtained or
made, as applicable, and the filing of certain financing statements in respect
of certain security interests).

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

 

64

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

(xiii) No Encumbrances. Except as contemplated by the Transaction Documents,
there are (A) no outstanding rights, options, warrants or agreements on the part
of Seller for a purchase, sale or issuance, in connection with the Purchased
Assets, (B) no agreements on the part of Seller to issue, sell or distribute the
Purchased Asset, and (C) no obligations on the part of Seller (contingent or
otherwise) to purchase, redeem or otherwise acquire any securities or interest
therein, except as contemplated by the Transaction Documents.

(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 has timely filed or caused to be filed all required federal
and other material tax returns that, to the Knowledge of Seller, would be
delinquent if they had not been filed on or before the date hereof and has paid
all Taxes imposed on it and any of its assets by any Governmental Authority
except for any such Taxes (A) as are being contested in good faith by
appropriate proceedings and with respect to which adequate reserves have been
provided in accordance with GAAP or (B) to the extent that the failure to pay
them could not reasonably be expected to result in a Material Adverse Effect. No
Tax liens have been filed against any of Seller’s assets and, to Seller’s
Knowledge, no claims are being asserted in writing with respect to any such
Taxes (except for liens and with respect to Taxes not yet due and payable or
liens or claims with respect to Taxes that are being contested in good faith and
for which adequate reserves have been established in accordance with GAAP).

(xvi) 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.

(xvii) Solvency. Neither the Transaction Documents nor any Transaction,
Additional Purchase Transaction or Future Funding Transaction thereunder are
entered into in contemplation of insolvency or with intent to hinder, delay or
defraud any of Seller’s creditors. The transfer of the Purchased Assets subject
hereto and the obligation to repurchase such Purchased Assets is not undertaken
with the intent to hinder, delay or defraud any of Seller’s creditors. As of the
Purchase Date, Seller is not insolvent within the meaning of 11 U.S.C.
Section 101(32) or any successor provision thereof and the transfer and sale of
the Purchased Assets pursuant hereto and the obligation to repurchase such
Purchased Asset (A) will not cause the liabilities of Seller to exceed the
assets of Seller, (B) will not result in Seller having unreasonably small
capital, and (C) will not result in debts that would be beyond Seller’s ability
to pay as the same mature. Seller received reasonably equivalent value in
exchange for the transfer and sale of the Purchased Assets and the Purchased
Items subject hereto. No petition in bankruptcy has been filed against Seller in
the last ten (10) years, and Seller has not in the last ten (10) years made an
assignment for the benefit of creditors or taken advantage of any debtors

 

65

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

relief laws. Seller has only entered into agreements on terms that would be
considered arm’s length and otherwise on terms consistent with other similar
agreements with other similarly situated entities.

(xviii) Use of Proceeds; Margin Regulations. All proceeds of each Transaction
shall be used by Seller for purposes permitted under Seller’s governing
documents, provided that no part of the proceeds of any Transaction will be used
by Seller to purchase or carry any margin stock or to extend credit to others
for the purpose of purchasing or carrying any margin stock. Neither the entering
into of any Transaction nor the use of any proceeds thereof will violate, or be
inconsistent with, any provision of Regulation T, U or X of the Board of
Governors of the Federal Reserve System.

(xix) Full and Accurate Disclosure. No material information contained in the
Transaction Documents, or any written statement furnished by or on behalf of
Seller 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.

(xx) Financial Information. All financial data concerning Seller and the
Purchased Assets that has been delivered by or on behalf of Seller to Buyer is
true, complete and correct in all material respects. All financial data
concerning Seller has been prepared fairly in accordance with GAAP. All
financial data concerning the Purchased Assets provided and prepared by Seller
has been prepared in accordance with standard industry practices. 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 or the Purchased Assets,
or in the results of operations of Seller, which change is reasonably likely to
have a Material Adverse Effect on Seller.

(xxi) Hedging Transactions. To the Knowledge of Seller, as of the Purchase Date
for any Purchased Asset that is subject to a Hedging Transaction, each such
Hedging Transaction is in full force and effect in accordance with its terms,
each counterparty thereto is an Affiliated Hedge Counterparty or a Qualified
Hedge Counterparty, and no “Termination Event”, “Event of Default”, “Potential
Event of Default” or any similar event, however denominated, has occurred and is
continuing with respect thereto.

(xxii) Servicing Agreements. Seller has delivered to Buyer all Servicing
Agreements pertaining to the Purchased Assets and to the Knowledge of Seller, as
of the date of this Agreement and as of the Purchase Date for the purchase of
any Purchased Assets subject to a Servicing Agreement, each such Servicing
Agreement is in full force and effect in accordance with its terms and no
default or event of default exists thereunder.

(xxiii) No Reliance. Seller has made its own independent decisions to enter into
the Transaction Documents and each Transaction and as to whether such
Transaction is

 

66

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

appropriate and proper for it based upon its own judgment and upon advice from
such advisors (including without limitation, legal counsel and accountants) as
it has deemed necessary. Seller is not relying upon any advice from Buyer as to
any aspect of the Transactions, including without limitation, the legal,
accounting or tax treatment of such Transactions.

(xxiv) PATRIOT Act.

A. Seller is in compliance, in all material respects, with the (1) the Trading
with the Enemy Act, as amended, and each of the foreign assets control
regulations of the United States Treasury Department (31 CFR, Subtitle B,
Chapter V, as amended) and any other applicable enabling legislation or
executive order relating thereto, and (2) the Uniting and Strengthening America
by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA
Patriot Act of 2001). No part of the proceeds of any Transaction will, to
Seller’s Knowledge, be used, directly or indirectly, for any payments to any
governmental official or employee, political party, official of a political
party, candidate for political office, or anyone else acting in an official
capacity, in order to obtain, retain or direct business or obtain any improper
advantage, in violation of the United States Foreign Corrupt Practices Act of
1977, as amended.

B. Seller agrees that, from time to time upon the prior written request of
Buyer, it shall (1) execute and deliver such further documents, provide such
additional information and reports and perform such other acts as Buyer may
reasonably request in order to insure compliance with the provisions hereof
(including, without limitation, compliance with the USA Patriot Act of 2001 and
to fully effectuate the purposes of this Agreement and (2) provide such opinions
of counsel concerning matters relating to this Agreement as Buyer may reasonably
request; provided, however, that nothing in this Article 9(b)(xxiv) shall be
construed as requiring Buyer to conduct any inquiry or decreasing Seller’s
responsibility for its statements, representations, warranties or covenants
hereunder. In order to enable Buyer and its Affiliates to comply with any
anti-money laundering program and related responsibilities including, but not
limited to, any obligations under the USA Patriot Act of 2001 and regulations
thereunder, Seller on behalf of itself and its Affiliates makes the following
representations and covenants to Buyer and its Affiliates that neither Seller,
nor, to Seller’s Knowledge, any of its Affiliates, is a Prohibited Investor,
and, to Seller’s Knowledge, Seller is not acting on behalf of or for the benefit
of any Prohibited Investor. Seller agrees to promptly notify Buyer or a person
appointed by Buyer to administer their anti-money laundering program, if
applicable, of any change in information affecting this representation and
covenant.

(xxv) Ownership of Property. Seller does not own, and has not ever owned, any
assets other than (A) the Purchased Assets, (B) such incidental personal
property related thereto; (C) the Asia House Loan, and (D) with respect to U.S.
Seller, the Other Facility Purchased Items.

 

67

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

(xxvi) Insider. Seller is not an “executive officer,” “director,” or “person who
directly or indirectly or acting through or in concert with one or more persons
owns, Controls, or has the power to vote more than 10% of any class of voting
securities” (as those terms are defined in 12 U.S.C. § 375(b) or in regulations
promulgated pursuant thereto) of Buyer, of a bank holding company of which Buyer
is a Subsidiary, or of any Subsidiary, of a bank holding company of which Buyer
is a Subsidiary, of any bank at which Buyer maintains a correspondent account or
of any lender which maintains a correspondent account with Buyer

(xxvii) Office of Foreign Assets Control. Seller warrants, represents and
covenants that neither Seller nor any of its Affiliates are or will be an entity
or person (A) that is listed in the Annex to, or is otherwise subject to the
provisions of, Executive Order 13224 issued on September 24, 2001 (“EO13224”);
(B) whose name appears on OFAC’s most current list of “Specifically Designed
National and Blocked Persons” or other sanctions-related list of designated
Persons maintained by the U.S. Department of State, the European Union or Her
Majesty’s Treasury of the United Kingdom; (C) who commits, threatens to commit
or supports “terrorism”, as that term is defined in EO 13224; or (D) who is
otherwise affiliated with, owns or controls any entity or person listed above
(any and all parties or persons described in (A) through (D) above are herein
referred to as a “Prohibited Person”). Seller covenants and agrees that none of
Seller nor any of its Affiliates will knowingly (1) conduct any business, nor
engage in any transaction or dealing, with any Prohibited Person or (2) engage
in or conspire to engage in any transaction that evades or avoids or that the
purpose of evading or avoiding any of the prohibitions of EO 13224. Seller
further covenants and agrees to deliver to Buyer any such certification or other
evidence as may be requested by Buyer in its sole and absolute discretion,
confirming that none of Seller or any of the its Affiliates is a Prohibited
Person and none of Seller, or any of its Affiliates has engaged in any business
transaction or dealings with a Prohibited Person, including, but not limited to,
the making or receiving of any contribution of funds, goods or services to or
for the benefit of a Prohibited Person.

(xxviii) Notice Address; Name; Jurisdiction of Organization. On the date of this
Agreement, Sellers’ addresses for notices are as specified on Annex I. U.S.
Seller’s legal name is, and has at all times been, Parlex 4 Finance, LLC.
Foreign Asset Seller’s legal name is, and has at all times been, Parlex 4 UK
Finco, LLC. Each Seller’s sole jurisdiction of organization is, and at all times
has been, Delaware. The location where each Seller keeps its books and records,
including all computer tapes and records relating to the Purchased Items, is its
related notice address. Each Seller may change its address for notices and for
the location of its books and records by giving Buyer written notice of such
change.

(xxix) Anti-Money Laundering Laws. Seller and its Affiliates either (1) is
entirely exempt from or (2) has otherwise fully complied with all applicable
anti-money laundering laws, sanctions programs and regulations of the United
States, the United Kingdom, the U.S. Department of State, the European Union or
Her Majesty’s Treasury of the United Kingdom (collectively, the “Anti-Money
Laundering Laws”), by (A) establishing an adequate anti-money laundering
compliance program as required by the

 

68

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

Anti-Money Laundering Laws, (B) conducting the requisite due diligence in
connection with the origination of each Purchased Asset for purposes of the
Anti-Money Laundering Laws, including with respect to the legitimacy of the
related obligor (if applicable) and the origin of the assets used by such
obligor to purchase the property in question, and (C) maintaining sufficient
information to identify the related obligor (if applicable) for purposes of the
Anti-Money Laundering Laws.

(xxx) Ownership. Seller is and shall remain at all times a wholly-owned direct
or indirect subsidiary of Guarantor.

(xxxi) Centre of Main Interests. Seller warrants, represents and covenants that
it has not (A) taken any action that would cause its “centre of main interests”
(as such term is defined in the Insolvency Regulation to be located in the
United Kingdom or (B) registered as a company in any jurisdiction other than
Delaware.

ARTICLE 10.

NEGATIVE COVENANTS OF SELLER

On and as of the date hereof and each Purchase Date and until this Agreement is
no longer in force with respect to any Transaction, neither Seller shall,
without the prior written consent of Buyer:

(a) subject to such Seller’s right to repurchase any Purchased Asset sold by
such Seller, take any action that would directly or indirectly impair or
adversely affect Buyer’s title to the Purchased Assets;

(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 Items (or any of it) to any Person other than Buyer,
or engage in repurchase transactions or similar transactions with respect to the
Purchased Items (or any of it) with any Person other than Buyer, unless and
until such Purchased Asset relating to such Purchased Items is repurchased by
Seller in accordance with this Agreement;

(c) modify in any material respect or terminate any Servicing Agreements to
which it is a party, without the consent of Buyer in its discretion, not to be
unreasonably withheld, conditioned, or delayed;

(d) create, incur or permit to exist any Lien in or on any of its property,
assets, revenue, the Purchased Assets, unless and until such Purchased Asset
relating to such Purchased Items is repurchased by Seller in accordance with
this Agreement, the Purchased Items, whether now owned or hereafter acquired,
other than the Liens granted by Seller pursuant to Article 6 of this Agreement
and the Lien granted by Parent under the Pledge Agreement;

(e) except as otherwise expressly permitted herein, enter into any transaction
of merger or consolidation or amalgamation, or liquidate, wind up or dissolve
itself (or suffer any liquidation, winding up or dissolution), sell all or
substantially all of its assets without the consent of Buyer in its sole and
absolute discretion;

 

69

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

(f) consent or assent to any amendment or supplement to, or termination of, any
note, loan agreement, mortgage or guarantee relating to the Purchased Assets or
other agreement or instrument relating to the Purchased Assets other than in
accordance with Article 7(e) or Article 27;

(g) permit the organizational documents or organizational structure of Seller to
be amended without the prior written consent of Buyer not to be unreasonably
withheld, conditioned, or delayed, other than special purpose entity provisions,
for which such consent shall be at Buyer’s sole and absolute discretion;

(h) acquire or maintain any right or interest in any Purchased Asset or
Underlying Mortgaged Property that is senior to or pari passu with the rights
and interests of Buyer therein under this Agreement and the other Transaction
Documents unless such right or interest becomes a Purchased Asset hereunder;

(i) use any part of the proceeds of any Transaction hereunder for any purpose
which violates, or would be inconsistent with, the provisions of Regulation T, U
or X of the Board of Governors of the Federal Reserve System;

(j) enter into any Hedging Transaction with respect to any Purchased Asset with
any entity that is not an Affiliated Hedge Counterparty or a Qualified Hedge
Counterparty;

(k) permit, at any time after thirty (30) days subsequent to the Purchase Date
of the first Purchased Asset subject to a Transaction, the number of Purchased
Assets that are Senior Mortgage Loans to be less than three (3); provided,
however, that in the event of an Early Repurchase of all Purchased Assets
subject to Transactions, this Article 10(k) shall not apply until such time as
Buyer and Seller enter into a new Transaction subsequent to such Early
Repurchase of all Purchased Assets; and

(l) take any action that will cause its “centre of main interests” (as such term
is defined in European Council Regulation (EC) No. 1346/2000 on Insolvency
Proceedings (the “Insolvency Regulation”) to be located in the United Kingdom or
register as a company in any jurisdiction other than Delaware.

ARTICLE 11.

AFFIRMATIVE COVENANTS OF SELLER

On and as of the date hereof and each Purchase Date and until this Agreement is
no longer in force with respect to any Transaction:

(a) Each Seller shall promptly notify Buyer of any material adverse change in
its business operations and/or financial condition; provided, however, that
nothing in this Article 11 shall relieve such Seller of its obligations under
this Agreement.

(b) Each Seller shall provide Buyer with copies of such documents as Buyer may
reasonably request evidencing the truthfulness of the representations set forth
in Article 9.

 

70

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

(c) Each Seller shall (1) defend the right, title and interest of Buyer in and
to the Purchased Items against, and take such other action as is necessary to
remove, the Liens, security interests, claims and demands of all Persons (other
than Liens created in favor of Buyer pursuant to the Transaction Documents) and
(2) at Buyer’s reasonable request, take all action necessary to ensure that
Buyer will have a first priority security interest in the Purchased Assets
subject to any of the Transactions in the event such Transactions are
recharacterized as secured financings.

(d) Each Seller shall notify Buyer and the Depository of the occurrence of any
Default or Event of Default with respect to such Seller of which Seller has
Knowledge as soon as possible but in no event later than the second
(2nd) Business Day after obtaining actual knowledge of such event.

(e) Each Seller shall cause the special servicer rating of the special servicer
with respect to all mortgage loans underlying Purchased Assets to be no lower
than “average” by S&P to the extent such Seller controls or is entitled to
control the selection of the special servicer. In the event the special servicer
rating with respect to any Person acting as special servicer for any mortgage
loans underlying Purchased Assets shall be below “average” by S&P, or if an Act
of Insolvency occurs with respect to either Seller or Guarantor, Buyer shall be
entitled to transfer special servicing with respect to all Purchased Assets to
an entity satisfactory to Buyer, to the extent such Seller controls or is
entitled to control the selection of the special servicer.

(f) Each Seller shall promptly (and in any event not later than two (2) Business
Days following receipt) deliver to Buyer (i) any notice of the occurrence of an
event of default under or report received by such Seller pursuant to the
Purchased Asset Documents; (ii) any notice of transfer of servicing under the
Purchased Asset Documents and (iii) any other information with respect to the
Purchased Assets that may be reasonably requested by Buyer from time to time and
within Seller’s possession or control or are obtainable by Seller.

(g) Each Seller will permit Buyer, its Affiliates or its designated
representative, upon reasonable prior written notice from Buyer, at reasonable
times not to exceed twice per calendar year unless an Event of Default has
occurred and is continuing, at Buyer’s sole cost and expense, to inspect such
Seller’s records with respect to the Purchased Items that are not privileged and
the conduct and operation of its business related thereto 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 such Seller’s business.

(h) If either Seller shall at any time become entitled to receive or shall
receive any rights, whether in addition to, in substitution of, as a conversion
of, or in exchange for a Purchased Asset, or otherwise in respect thereof, such
Seller shall accept the same as Buyer’s agent, hold the same in trust for Buyer
and deliver the same forthwith to Buyer (or the Custodian, as appropriate) in
the exact form received, duly endorsed by Seller to Buyer, if required, together
with all related necessary transfer documents, to be held by Buyer hereunder as
additional collateral security for the Transactions. If any sums of money or
property are paid or distributed in respect of the Purchased Assets and received
by either Seller, such Seller shall,

 

71

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

until such money or property is paid or delivered to Buyer, hold such money or
property in trust for Buyer, segregated from other funds of such Seller, as
additional collateral security for the Transactions.

(i) At any time from time to time upon the reasonable request of Buyer, at the
sole expense of the applicable Seller, each Seller will (i) 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 perfected,
first-priority security interest required hereunder, (ii) ensure that such
security interest remains fully perfected at all times and remains at all times
first in priority as against all other creditors of such Seller (whether or not
existing as of the Closing Date, any Purchase Date or in the future) and
(iii) obtain or preserve the rights and powers herein granted (including, among
other things, filing such UCC financing statements or similar requirements under
the laws of England and Wales and/or other jurisdictions as Buyer may reasonably
request). If any amount payable under or in connection with any of the Purchased
Items shall be or become evidenced by any promissory note, other instrument or
certificated security, such note, instrument or certificated security shall be
immediately delivered to Buyer, duly endorsed in a manner satisfactory to Buyer,
to be itself held as a Purchased Item pursuant to this Agreement, and the
documents delivered in connection herewith.

(j) Each Seller shall provide, or to cause to be provided, to Buyer the
following financial and reporting information:

(i) Within fifteen (15) calendar days after each month-end, a monthly reporting
package substantially in the form of Exhibit III-A attached hereto (the “Monthly
Reporting Package”);

(ii) Within forty-five (45) calendar days after the last day of each of the
first three fiscal quarters in any fiscal year, a quarterly reporting package
substantially in the form of Exhibit III-B attached hereto (the “Quarterly
Reporting Package”);

(iii) Within ninety (90) calendar days after the last day of its fiscal year, an
annual reporting package substantially in the form of Exhibit III-C attached
hereto (the “Annual Reporting Package”); and

(iv)(A) Upon Buyer’s request, a listing of any material changes in Hedging
Transactions with Qualified Hedge Counterparties, the names of the Qualified
Hedge Counterparties and the material terms of such Hedging Transactions,
delivered within ten (10) days after Buyer’s request; and

(B) copies of each Seller’s and Guarantor’s Federal Income Tax returns, if any,
delivered within thirty (30) days after the earlier of (1) filing or (2) the
last filing extension period.

(k) Sellers shall make a representative available to Buyer every month for
attendance at a telephone conference, the date of which to be mutually agreed
upon by Buyer and Sellers, regarding the status of each Purchased Asset,
Sellers’ compliance with the requirements of Articles 10 and 11, and any other
matters relating to the Transaction Documents or Transactions that Buyer wishes
to discuss with Sellers.

 

72

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

(l) Each Seller shall and shall cause Guarantor to at all times (i) comply with
all material contractual obligations, (ii) comply in all respects with all laws,
ordinances, rules, regulations and orders (including, without limitation,
environmental laws) of any Governmental Authority or any other federal, state,
municipal or other public authority having jurisdiction over the Sellers and
Guarantor or any of its assets and the Sellers and Guarantor shall do or cause
to be done all things necessary to preserve and maintain in full force and
effect its legal existence, and all licenses material to its business and
(iii) maintain and preserve its legal existence and all of its material rights,
privileges, licenses and franchises necessary for the operation of its business
(including, without limitation, preservation of all lending licenses held by
such Seller and of such Seller’s status as a “qualified transferee” (however
denominated) under all documents which govern the Purchased Assets).

(m) Each Seller shall and shall cause Guarantor to at all times keep proper
books of records and accounts in which full, true and correct entries shall be
made of its transactions fairly 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.

(n) Each Seller shall observe, perform and satisfy all the terms, provisions,
covenants and conditions 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. Each Seller will continue to be a U.S. Person
that is a partnership for U.S. federal income tax purposes, or a disregarded
entity of a U.S. Person for U.S. federal income tax purposes. Each Seller shall
pay and discharge all Taxes on its assets and on the Purchased Items that, in
each case, in any manner would create any Lien upon the Purchased Items, except
for Liens created pursuant to the Transaction Documents and other than any Liens
with respect to Taxes, such taxes that 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 or Taxes that are
not yet due and payable.

(o) Each Seller shall advise Buyer in writing of the opening of any new chief
executive office or the closing of any such office of such Seller or Guarantor
and of any change in such Seller’s or Guarantor’s name or respective
jurisdictions of organization or the places where the books and records
pertaining to the Purchased Assets are held not less than thirty (30) Business
Days’ prior to taking any such action.

(p) Each Seller will maintain records with respect to the Purchased Items and
the conduct and operation of its business with no less a degree of prudence than
if the Purchased Items were held by such Seller for its own account and will
furnish Buyer, upon reasonable request by Buyer or its designated
representative, with reasonable information reasonably obtainable by such Seller
with respect to the Purchased Items and the conduct and operation of its
business.

(q) Each Seller shall provide Buyer and its Affiliates with reasonable access
plus any such additional reports as Buyer may reasonably request. Upon two
(2) Business Days’ prior

 

73

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

notice (unless a Default or an Event of Default shall have occurred and is
continuing, in which case, no prior notice shall be required), during normal
business hours, such Seller shall allow Buyer to (i) review any operating
statements, occupancy status and other property level information with respect
to the underlying real estate directly or indirectly securing or supporting the
Purchased Asset that either is in such Seller’s possession or is available to
such Seller, (ii) examine, copy (at Buyer’s expense) and make extracts from its
books and records, to inspect any of its properties, and (iii) discuss such
Seller’s business and affairs with its officers.

(r) Each Seller shall enter into Hedging Transactions with respect to each of
the Hedge-Required Assets to the extent necessary to hedge interest rate risk
associated with the Purchase Price on such Hedge-Required Assets, in a manner
reasonably acceptable to Buyer.

(s) Each Seller shall take all such steps as Buyer deems necessary to perfect
the security interest granted pursuant to Article 6 in the Hedging Transactions,
shall take such action as shall be necessary or advisable to preserve and
protect such Seller’s interest under all such Hedging Transactions (including,
without limitation, requiring the posting of any required additional collateral
thereunder), and hereby authorizes Buyer to take any such action that such
Seller fails to take after demand therefor by Buyer. Each Seller shall provide
the Custodian with copies of all documentation relating to Hedging Transactions
with Qualified Hedge Counterparties promptly after entering into same. All
Hedging Transactions, if any, entered into by such Seller with Buyer or any of
its Affiliates in respect of any Purchased Asset shall be terminated
contemporaneously with the repurchase of such Purchased Asset on the Repurchase
Date therefor.

 

(t)

Each Seller shall:

(i) continue to engage in business of the same general type as now conducted by
it or otherwise as reasonably approved by Buyer prior to the date hereof and
maintain and preserve its legal existence and all of its material rights,
privileges, licenses and franchises necessary for the operation of its business
(including, without limitation, preservation of all lending licenses held by
such Seller and of such Seller’s status as a “qualified transferee” (however
denominated) under all documents which govern the Purchased Assets) to the
extent that failure to do so would have a Material Adverse Effect;

(ii) comply with all contractual obligations and with the requirements of all
applicable laws, rules, regulations and orders of Governmental Authorities
(including, without limitation, all environmental laws) if failure to comply
with such requirements would be reasonably likely (either individually or in the
aggregate) to have a Material Adverse Effect;

(iii) keep adequate records and books of account, in which complete entries will
be made in accordance with GAAP consistently applied;

(iv) pay and discharge all Taxes imposed on it or on its income or profits or on
any of its Property prior to the date on which penalties attach thereto, except
for any such Taxes the payment of which is being contested in good faith and by
proper proceedings and against which adequate reserves are being maintained; and

 

74

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

(v) not cause or permit any Change of Control without the prior written consent
of Buyer.

(u) Each Seller shall cause each servicer of the Purchased Asset to provide to
Buyer and to the Custodian via electronic transmission, promptly upon request by
Buyer a Servicing Tape for the month (or any portion thereof) prior to the date
of Buyer’s request; provided that to the extent any servicer does not provide
any such Servicing Tape, such Seller shall prepare and provide to Buyer and the
Custodian via electronic transmission a remittance report containing the
servicing information that would otherwise be set forth in the Servicing Tape;
provided, further, that regardless of whether such Seller at any time delivers
any such remittance report, such Seller shall at all times use commercially
reasonable efforts to cause each servicer to provide each Servicing Tape in
accordance with this Article 11(u).

(v) Each Seller’s organizational documents shall at all times include the
following provisions: (a) at all times there shall be, and such Seller shall
cause there to be, at least one (1) Independent Director; (b) such Seller shall
not, without the unanimous written consent of its board of directors including
the Independent Director, take any Material Action or any action that might
cause such entity to become insolvent; (c) no Independent Director may be
removed or replaced unless such Seller provides Buyer with not less than five
(5) Business Days’ prior written notice of (i) any proposed removal of an
Independent Director, together with a statement as to the reasons for such
removal, and (ii) the identity of the proposed replacement Independent Director,
together with a certification that such replacement satisfies the requirements
set forth in the organizational documents for an Independent Director; and
provided further, that any removal or replacement shall not be effective until
the replacement Independent Director has accepted his or her appointment; (d) to
the fullest extent permitted by applicable law, including Section 18-1101(c) of
the Bankruptcy Code and notwithstanding any duty otherwise existing at law or in
equity, the Independent Director shall consider only the interests of such
Seller, including its creditors in acting or otherwise voting with respect to a
Material Action; (e) except for duties to such Seller as set forth in subsection
(d) above (including duties to its equity owners and its creditors solely to the
extent of their respective economic interests in such Seller but excluding
(i) all other interests of the equity owners, (ii) the interests of other
Affiliates of Seller, and (iii) the interests of any group of Affiliates of
which such Seller is a part), the Independent Director shall not have any
fiduciary duties to any Person bound by its organizational documents; (f) the
foregoing shall not eliminate the implied contractual covenant of good faith and
fair dealing under applicable law; and (g) to the fullest extent permitted by
applicable law, including Section 18-1101(e) of the Bankruptcy Code, an
Independent Director shall not be liable to Seller or any other Person for
breach of contract or breach of duties (including fiduciary duties), unless the
Independent Director acted in bad faith or engaged in willful misconduct. No
consent by Buyer shall be required for the removal of any Independent Director
for Cause. “Cause” means, with respect to an Independent Director, (i) acts or
omissions by such Independent Director that constitute willful disregard of such
Independent Director’s duties as set forth in such Seller’s organizational
documents, (ii) that such Independent Director has engaged in or has been
charged with, or has been convicted of, fraud or other acts constituting a crime
under any law applicable to such Independent Director, (iii) that such
Independent

 

75

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

Director is unable to perform his or her duties as Independent Director due to
death, disability or incapacity, or (iv) that such Independent Director no
longer meets the definition of Independent Director.

(w) Each Seller has not and will not, except in connection with the obligations
contemplated under the Transaction Documents:

(i) engage in any business or activity other than the entering into and
performing its obligations under the Transaction Documents, and activities
incidental thereto;

(ii) acquire or own any assets other than (A) the Purchased Assets, (B) the Asia
House Loan, so long as the Asia House Loan is either (1) being assessed by Buyer
as a potential Purchased Asset or (2) is a Purchased Asset, and (C) such
incidental personal property related thereto;

(iii) merge into or consolidate with any Person, or dissolve, terminate,
liquidate in whole or in part, transfer or otherwise dispose of all or
substantially all of its assets or change its legal structure;

(iv) fail to observe all organizational formalities, or fail to preserve its
existence as an entity duly organized, validly existing and in good standing (if
applicable) under the applicable laws of the jurisdiction of its organization or
formation, or (B) amend, modify, terminate or fail to comply with the material
provisions of its organizational documents, in each case without the prior
written consent of Buyer;

(v) own any subsidiary, or make any investment in, any Person;

(vi) commingle its assets with the assets of any other Person (excluding any
consolidation of its financials with those of an Affiliate in accordance with
GAAP), or permit any Affiliate or constituent party independent access to its
bank accounts;

(vii) incur any debt, secured or unsecured, direct or contingent (including
guaranteeing any obligation), other than the debt incurred pursuant to this
Agreement and the other Transaction Documents and unsecured trade debt in an
unpaid amount less than $100,000;

(viii) fail to maintain its records, books of account, bank accounts, financial
statements, accounting records and other entity documents separate and apart
from those of any other Person; except that such Seller’s financial position,
assets, liabilities, net worth and operating results may be included in the
consolidated financial statements of an Affiliate, provided that (A) appropriate
notation shall be made on such consolidated financial statements to indicate the
separate identity of such Seller from such Affiliate and that such Seller’s
assets and credit are not available to satisfy the debts and other obligations
of such Affiliate or any other Person, and (B) such Seller’s assets, liabilities
and net worth shall also be listed on such Seller’s own separate balance sheet;

 

76

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

(ix) except for capital contributions or capital distributions permitted under
the terms and conditions of such Seller’s organizational documents and properly
reflected on its books and records, enter into any transaction, contract or
agreement with any general partner, member, shareholder, principal, guarantor of
the obligations of such Seller, or any Affiliate of the foregoing, except upon
terms and conditions that are intrinsically fair, commercially reasonable and
substantially similar to those that would be available on an arm’s-length basis
with unaffiliated third parties;

(x) maintain its assets in such a manner that it will be costly or difficult to
segregate, ascertain or identify its individual assets from those of any other
Person;

(xi) assume or guaranty the debts of any other Person, hold itself out to be
responsible for the debts of any other Person, or otherwise pledge its assets to
secure the obligations of any other Person or hold out its credit or assets as
being available to satisfy the obligations of any other Person;

(xii) except in connection with the origination of the Purchased Assets, make
any loans or advances to any Person, or own any stock or securities of, any
Person;

(xiii)(A) fail to file its own tax returns separate from those of any other
Person, except to the extent such Seller is not required to file tax returns
under Applicable Law, (B) fail to pay any taxes required to be paid under
Applicable Law, or any obligation to reimburse its equityholders or their
Affiliates for any taxes that such equityholders or their Affiliates may incur
as a result of any profits or losses of such Seller;

(xiv) fail to (A) hold itself out to the public as a legal entity separate and
distinct from any other Person, (B) conduct its business solely in its own name
or (C) correct any misunderstanding of which such Seller has Knowledge regarding
its separate identity;

(xv) fail to maintain adequate capital for the normal obligations reasonably
foreseeable in a business of its size and character and in light of its
contemplated business operations, provided that the foregoing shall not require
any member, partner or shareholder of such Seller to make any additional capital
contributions to Seller;

(xvi) if it is a partnership or limited liability company, without the unanimous
written consent of all of its partners or members, as applicable, and the
written consent of one hundred percent (100%) of all directors or managers of
such Seller, including, without limitation, the Independent Director, take any
Material Action or any action that might cause such entity to become insolvent;

(xvii) fail to allocate shared expenses (including, without limitation, shared
office space and services performed by an employee of an Affiliate) among the
Persons sharing such expenses and to use separate stationery, invoices and
checks bearing its own name;

(xviii) fail to remain solvent or pay its own liabilities only from its own
funds; provided that the foregoing shall not require any member, partner or
shareholder of such Seller to make any additional capital contributions to such
Seller;

 

77

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

(xix) acquire obligations or securities of its partners, members, shareholders
or other Affiliates, as applicable;

(xx) have any employees, but shall be permitted to utilize employees of its
Affiliates pursuant to arms-length terms;

(xxi) fail to maintain and use separate stationery, invoices and checks bearing
its own name;

(xxii) have any of its obligations guaranteed by an Affiliate except for the
Guarantee Agreement;

(xxiii) identify itself as a department or division of any other Person; or

(xxiv) except in connection with the Purchased Assets, buy or hold evidence of
indebtedness issued by any other Person (other than cash or investment-grade
securities); provided that U.S. Seller is permitted to buy and hold evidence of
indebtedness pursuant to the Other Facility.

(x) With respect to each Eligible Asset to be purchased hereunder, the
applicable Seller shall notify Buyer in writing of the creation of any right or
interest in such Eligible Asset or related Underlying Mortgaged Property that is
senior to or pari passu with the rights and interests that are to be transferred
to Buyer under this Agreement and the other Transaction Documents, and whether
any such interest will be held or obtained by Seller or an Affiliate of Seller.

(y) Each Seller shall be solely responsible for the fees and expenses of the
Custodian, Depository and each servicer (including, without limitation, the
Interim Servicer) of any or all of the Purchased Assets.

(z) Each Seller shall obtain estoppels and agreements reasonably acceptable to
Buyer for each Asset that is subject to a ground lease.

(aa) Each Seller shall notify Buyer in writing of any event or occurrence that
could be reasonably determined to cause Guarantor to breach any of the covenants
contained in paragraph 9 of the Guarantee Agreement.

(bb) With respect to each Purchased Asset subject to a Transaction, each Seller
shall pay Buyer the applicable Purchased Asset Fee for such Purchased Asset as
forth herein and in the Fee Letter.

ARTICLE 12.

EVENTS OF DEFAULT; REMEDIES

(a) Each of the following events shall constitute an “Event of Default” under
this Agreement:

(i) either Seller or Guarantor shall fail to repurchase (A) Purchased Assets
upon the applicable Repurchase Date or (B) a Purchased Asset that is no longer
an Eligible Asset in accordance with Article 12(c);

 

78

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

(ii) Buyer shall fail to receive on any Remittance Date the accreted value of
the Price Differential (less any amount of such Price Differential previously
paid by

either Seller to Buyer) (including, without limitation, in the event the Income
paid or distributed on or in respect of the Purchased Assets is insufficient to
make such payment and either Seller does not make such payment or cause such
payment to be made) (except that such failure shall not be an Event of Default
by either Seller if sufficient Income, including Principal Proceeds which would
otherwise be remitted to the applicable Seller pursuant to Article 5 of this
Agreement, is on deposit in the Depository Accounts and the Depository fails to
remit such funds to Buyer);

(iii) either Seller or Guarantor shall fail to cure any Margin Deficit, to the
extent such Margin Deficit equals or exceeds the Minimum Transfer Amount, in
accordance with Article 4 of this Agreement;

(iv) either Seller or Guarantor shall fail to make any payment not otherwise
addressed under this Article 12(a) owing to Buyer that has become due, whether
by acceleration or otherwise under the terms of this Agreement, the Pledge
Agreement, the Guarantee Agreement or any other Transaction Document, which
failure is not remedied within five (5) Business Days of notice thereof;

(v) either Seller shall default in the observance or performance of its
obligation in Article 7(c) or any agreement contained in Articles 10 or 11 of
this Agreement and such default shall not be cured within five (5) Business Days
after notice by Buyer to the applicable Seller thereof;

(vi) an Act of Insolvency occurs with respect to either Seller or Guarantor;

(vii) a Change of Control occurs with respect to either Seller or Guarantor
without the prior written consent of Buyer;

(viii) any employee with a title equivalent or more senior to that of “Senior
Vice President” of either Seller or Guarantor shall admit in writing to any
Person in an external communication (whether electronic or otherwise) its
inability to, or its intention not to, perform any of its material obligations
hereunder;

(ix) the Custodial Agreement, a Depository Agreement, the Pledge Agreement, the
Guarantee Agreement or any other Transaction Document or a replacement therefor
acceptable to Buyer shall for whatever reason be terminated or cease to be in
full force and effect, or the enforceability thereof shall be contested by
either Seller;

(x) either Seller or Guarantor shall be in default under (A) any Indebtedness of
Seller or Guarantor, as applicable, which default (1) involves the failure to
pay a matured obligation in excess of $250,000, with respect to such Seller or
$15,000,000, with respect to Guarantor or (2) permits the acceleration of the
maturity of obligations by

 

79

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

any other party to or beneficiary with respect to such Indebtedness, if the
aggregate amount of the Indebtedness in respect of which such default or
defaults shall have occurred is at least $250,000, with respect to such Seller
or $15,000,000, with respect to Guarantor; or (B) any other material contract to
which such Seller or Guarantor is a party, which default (1) involves the
failure to pay a matured obligation if the aggregate amount of such obligation
is greater than $250,000 with respect to such Seller or $15,000,000 with respect
to Guarantor, or (2) permits the acceleration of the maturity of obligations by
any other party to or beneficiary of such contract if the aggregate amount of
such obligations is greater than $250,000, with respect to such Seller or
$15,000,000, with respect to Guarantor;

(xi) either Seller or Guarantor shall be in default under any Indebtedness of
such Seller or Guarantor, as applicable, to Buyer or any of its present or
future Affiliates, which default (A) involves the failure to pay a matured
obligation, or (B) permits the acceleration of the maturity of obligations by
any other party to or beneficiary with respect to such Indebtedness;

(xii)(A) either Seller or an ERISA Affiliate shall engage in any non-exempt
“prohibited transaction” (as defined in Section 406 of ERISA or Section 4975 of
the Code) involving any Plan that is not exempt from such Sections of ERISA and
the Code, (B) any material “accumulated funding deficiency” (as defined in
Section 302 of ERISA), whether or not waived, shall exist with respect to any
Plan or any Lien in favor of the Pension Benefit Guaranty Corporation or a Plan
shall arise on the assets of Seller or any ERISA Affiliate, (C) a “Reportable
Event” (as referenced in Section 4043(b)(3) of ERISA) shall occur with respect
to, or proceedings shall commence to have a trustee appointed, or a trustee
shall be appointed, to administer or to terminate, any Plan, which Reportable
Event (as so defined) or commencement of proceedings or appointment of a trustee
is, in the reasonable opinion of Buyer, likely to result in the termination of
such Plan for purposes of Title IV of ERISA, (D) any Plan shall terminate for
purposes of Title IV of ERISA, (E) either Seller or any ERISA Affiliate shall,
or in the reasonable opinion of Buyer is likely to, incur any liability in
connection with a withdrawal from, or the insolvency or reorganization of, a
Multiemployer Plan or (F) any other event or condition shall occur or exist with
respect to a Plan; and in each case in clauses (A) through (F) above, such event
or condition, together with all other such events or conditions, if any, could
reasonably be expected to have a Material Adverse Effect;

(xiii) either (A) the Transaction Documents shall for any reason not cause, or
shall cease to cause, Buyer to be the owner free of any adverse claim of any of
the Purchased Assets, and such condition is not cured by a Seller within three
(3) Business Days after notice thereof from Buyer to such Seller, or (B) if a
Transaction is recharacterized as a secured financing, and the Transaction
Documents with respect to any Transaction shall for any reason cease to create
and maintain a valid first priority security interest in favor of Buyer in any
of the Purchased Assets;

(xiv) an “Event of Default,” “Termination Event,” “Potential Event of Default”
or other default or breach, however defined therein, occurs under any Hedging

 

80

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

Transaction on the part of a Seller, or the counterparty to a Seller on any such
Hedging Transaction with a Qualified Hedge Counterparty ceases to be a Qualified
Hedge Counterparty, that is otherwise not cured within any applicable cure
period thereunder or, if no cure period exists thereunder, which is not cured by
such Seller within three (3) Business Days after notice thereof from an
Affiliated Hedge Counterparty or Qualified Hedge Counterparty to such Seller;

(xv) any governmental, regulatory, or self-regulatory authority shall have taken
any action to suspend or terminate the rights, privileges, or operations of
either Seller, which suspension has a Material Adverse Effect in the
determination of Buyer;

(xvi) any other representation (other than the representations and warranties of
either Seller set forth in Exhibit VI and Article 9(b)(viii)(D), which shall not
be considered an Event of Default if incorrect or untrue in any material
respect) made by either Seller to Buyer 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) calendar days after the earlier of receipt of written
notice thereof from Buyer or such Seller’s Knowledge of such incorrect or untrue
representation;

(xvii) a final non-appealable judgment by any competent court in the United
States of America for the payment of money (A) rendered against either Seller in
an amount greater than $250,000 or (B) rendered against Guarantor in an amount
greater than $15,000,000, and remained undischarged or unpaid for a period of
sixty (60) days, during which period execution of such judgment is not
effectively stayed by bonding over or other means reasonably acceptable to
Buyer;

(xviii) if either Seller shall breach or fail to perform any of the terms,
covenants, obligations or conditions of this Agreement, other than as
specifically otherwise referred to in this definition of “Event of Default”, and
such breach or failure to perform is not remedied within the earlier of five
(5) Business Days after (a) delivery of notice thereof to such Seller by Buyer,
or (b) Knowledge on the part of Seller of such breach or failure to perform;
provided, that, if Buyer determines, in its sole discretion, that any such
breach is capable of being cured and such Seller is diligently and continuously
pursuing such a cure in good faith but is not able to do so on a timely basis,
such Seller shall have an additional period of time, not to exceed thirty
(30) additional days, within which to complete such cure; provided further, that
such additional 30-day period shall not apply to any breach of or other failure
to comply with the terms of Article 10(k) of this Agreement;

(xix) the Guarantee Agreement or a replacement therefor acceptable to Buyer
shall for whatever reason be terminated or cease to be in full force and effect,
or the enforceability thereof shall be contested by Guarantor or either Seller;

(xx) the breach by Guarantor of any material term or condition set forth in the
Guarantee Agreement or of any representation, warranty, certification or
covenant made or deemed made in the Guarantee Agreement by Guarantor or if any
certificate furnished by Guarantor to Buyer pursuant to the provisions hereof or
thereof or any information

 

81

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

with respect to the Purchased Assets furnished in writing on behalf of Guarantor
shall prove to have been false or misleading in any respect as of the time made
or furnished; provided, however, that any such default, failure to perform or
breach shall not constitute an Event of Default if 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; and

(xxi) an Event of Default (as such term is defined in the Other Repurchase
Agreement) occurs under the Other Facility.

(b) After the occurrence and during the continuance of an Event of Default, each
Seller hereby appoints Buyer as attorney-in-fact of such Seller 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. If an Event of
Default shall occur and be continuing with respect to either Seller, the
following rights and remedies shall be available to Buyer:

(i) At the option of Buyer, exercised by written notice to such 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 with respect to such
Seller or Guarantor), 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
Article 12(b)(i) of this Agreement:

(A) each Seller’s obligations hereunder to repurchase all Purchased Assets 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 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 Repurchase Price for such Transaction
(decreased by (I) any amounts actually remitted to Buyer by the Depository or
either Seller from time to time pursuant to Article 5 of this Agreement and
applied to such Repurchase Price, and (II) any amounts applied to the Repurchase
Price pursuant to Article 12(b)(iii) of this Agreement); and

 

82

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

(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 Assets.

(iii) Upon the occurrence and during the continuance of an Event of Default with
respect to either Seller, Buyer may (A) immediately sell on a servicing released
basis, at a public or private sale in a commercially reasonable manner and at
such price or prices as Buyer may deem satisfactory any or all of the Purchased
Assets, and/or (B) in its sole discretion elect, in lieu of selling all or a
portion of such Purchased Assets, to give Sellers credit for such Purchased
Assets in an amount equal to the Market Value of such Purchased Assets against
the aggregate unpaid Repurchase Price for such Purchased Assets and any other
amounts owing by Sellers under the Transaction Documents. The proceeds of any
disposition of Purchased Assets effected pursuant to this Article 12(b)(iii)
shall be applied, (v) first, to the costs and expenses incurred by Buyer in
connection with such Seller’s default; (w) second, to actual out-of-pocket
damages incurred by Buyer in connection with such Seller’s default (including,
but not limited to, costs of cover and/or Hedging Transactions, if any),
(x) third, to the Repurchase Price; (y) fourth, to any Breakage Costs; and
(z) fifth, to return any excess to Sellers.

(iv) The parties recognize that it may not be possible to purchase or sell all
of the Purchased Assets on a particular Business Day, or in a transaction with
the same purchaser, or in the same manner because the market for such Purchased
Assets may not be liquid. In view of the nature of the Purchased Assets, the
parties agree that liquidation of a Transaction or the Purchased Assets 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, the time and manner of
liquidating any Purchased Assets, and nothing contained herein shall
(A) obligate Buyer to liquidate any Purchased Assets on the occurrence and
during the continuance of an Event of Default or to liquidate all of the
Purchased Assets in the same manner or on the same Business Day or
(B) constitute a waiver of any right or remedy of Buyer.

(v) Each Seller shall be liable to Buyer and its Affiliates and shall indemnify
Buyer and its Affiliates for (A) the amount (including in connection with the
enforcement of this Agreement) of all out of pocket losses, and costs and
expenses, including reasonable legal fees and expenses of outside counsel,
actually incurred by Buyer in connection with or as a consequence of an Event of
Default with respect to such Seller and (B) all documented, actual costs
incurred by Buyer in connection with the termination of Hedging Transactions in
the event that such Seller, from and after an Event of Default, takes any action
to impede or otherwise affect Buyer’s remedies under this Agreement.

(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 (where relevant), 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 as in effect from
time-to-time in the State of New York, to

 

83

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

the extent that the UCC is applicable, and the right to offset any mutual debt
and claim and the right to appropriate the Purchased Assets in accordance with
Article 12(b)(vi)), in equity, and under any other agreement between Buyer and
either Seller. Without limiting the generality of the foregoing, Buyer shall be
entitled to set off the proceeds of the liquidation of the Purchased Assets
against all of either Seller’s obligations to Buyer under this Agreement,
without prejudice to Buyer’s right to recover any deficiency. The parties hereto
agree that the method of valuation of Purchased Assets provided for in Article
12(b)(vi) shall constitute a commercially reasonable method of valuation for the
purposes of the FCA Regulations.

(vii) Subject to the applicable notice and cure periods set forth herein, Buyer
may exercise any or all of the remedies available to Buyer immediately upon the
occurrence of an Event of Default with respect to either Seller 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 that Buyer may have.

(viii) Buyer may enforce its rights and remedies hereunder without prior
judicial process or hearing, and each Seller hereby expressly waives any
defenses such Seller might otherwise have to require Buyer to enforce its rights
by judicial process. Each Seller also waives, to the extent permitted by law,
any defense such Seller might otherwise have arising from the use of nonjudicial
process, disposition of any or all of the Purchased Assets, or from any other
election of remedies. Each 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.

(c) If at any time Buyer determines that (i) any Purchased Asset is not an
Eligible Asset (other than as a result of a breach of a Mark-to-Market
Representation, which shall in no event, in and of itself, cause an Early
Repurchase but may be used in connection with the determination of Market Value
in accordance with this Agreement) or (ii) has been released from the possession
of the Custodian for a period in excess of ten (10) calendar days, the related
Transaction shall terminate and an Early Repurchase Date shall be deemed to
occur with respect to such Purchased Asset. No later than three (3) Business
Days after receiving written notice from Buyer or any Seller becoming otherwise
aware that such Purchased Asset is not an Eligible Asset, such Seller shall
repurchase the affected Purchased Asset and such Seller shall pay the applicable
Repurchase Price for such Purchased Asset to Buyer by depositing such amount in
immediately available funds at the direction of Buyer.

ARTICLE 13.

SINGLE AGREEMENT

Buyer and each Seller acknowledge that, and have entered hereinto and will enter
into each Transaction (including an Additional Purchase Transaction or Future
Funding 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 each Seller agrees (i) to perform all of its obligations in
respect of each Transaction hereunder, and that a default in the performance of
any

 

84

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

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.

ARTICLE 14.

RECORDING OF COMMUNICATIONS

EACH OF BUYER AND EACH 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. EACH OF BUYER AND EACH SELLER HEREBY CONSENTS TO THE
ADMISSIBILITY OF SUCH TAPE RECORDINGS IN ANY COURT, ARBITRATION, OR OTHER
PROCEEDINGS, AND AGREES THAT A DULY AUTHENTICATED TRANSCRIPT OF SUCH A TAPE
RECORDING SHALL BE DEEMED TO BE A WRITING CONCLUSIVELY EVIDENCING THE PARTIES’
AGREEMENT.

ARTICLE 15.

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 or Royal Mail, with proof of delivery or (d) by email,
provided that such emailed notice must also be delivered by one of the means set
forth above, 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 Article 15. A notice shall be deemed to have been given:
(w) in the case of hand delivery, at the time of delivery, (x) in the case of
registered or certified mail, when delivered or the first attempted delivery on
a Business Day, (y) in the case of expedited prepaid delivery upon the first
attempted delivery on a Business Day, or (z) in the case of email, upon receipt
of confirmation, provided that such emailed notice was also delivered as
required in this Article 15. A party receiving a notice that does not comply
with the technical requirements for notice under this Article 15 may elect to
waive any deficiencies and treat the notice as having been properly given.

 

85

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

ARTICLE 16.

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.

ARTICLE 17.

NON-ASSIGNABILITY

(a) Subject to Article 17(b) below, neither Seller may assign any of its
respective rights or obligations under this Agreement without the prior written
consent of Buyer (not to be unreasonably withheld or delayed) and any attempt by
either Seller to assign any of its rights or obligations under this Agreement
without the prior written consent of Buyer shall be null and void. Buyer may,
without consent of either Seller, sell to one or more banks, financial
institutions or other entities (“Participants”) (other than with respect to an
assignment to a Prohibited Transferee, which shall be subject to the prior
written consent of the applicable Seller) participating interests in any
Transaction, its interest in the Purchased Assets, or any other interest of
Buyer under this Agreement. Buyer may, at any time and from time to time, upon
prior written notice to the applicable Seller, assign to any Person (other than
Prohibited Transferees, so long as no Event of Default has occurred and is
continuing, in which case such limitation shall not apply) (an “Assignee” and
together with Participants, each a “Transferee” and collectively, the
“Transferees”) all or any part of its rights its interest in the Purchased
Assets, or any other interest of Buyer under this Agreement; provided, however,
that in all such circumstances (for the avoidance of doubt, including
participations) other than a sale, assignment, transfer or participation by
Buyer of one hundred percent (100%) of its rights and obligations under the
Transaction Documents (which sale, assignment, transfer or participation, if
Buyer does not retain control and authority over its rights and obligations
under the Transaction Documents, shall be subject to the prior written consent
of the applicable Seller, not to be unreasonably withheld, conditioned or
delayed), (i) Buyer shall retain control and authority over its rights and
obligations under the Transaction Documents and any Transaction, subject to
major decision approval rights, (ii) the applicable Seller shall not be
obligated or required to deal directly or indirectly with any Person other than
Buyer, and (iii) such Seller shall not be charged for, incur or be required to
reimburse Buyer or any other Person for any costs or expense relating to any
such sale, assignment, transfer or participation. Each Seller and Guarantor
agrees to reasonably cooperate with Buyer, at Buyer’s sole cost and expense, in
connection with any such assignment, transfer or sale of participating interest
and to enter into such restatements of, and amendments, supplements and other
modifications to, this Agreement in order to give effect to such assignment,
transfer or sale. Each Seller agrees that each properly registered Participant
shall be entitled to the benefits of Article 3(h), Article 3(i), and
Articles 3(n) through (s) (subject to the requirements and limitations therein,
including, without limitation and for the avoidance of doubt, the requirements
under Article 3(o) or Article 3(p) (it being understood that the documentation
required under Article 3(p) shall be delivered to the participating Buyer or
Assignee, as applicable)) to the same extent as if it were an Assignee and had
acquired its

 

86

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

interest by assignment pursuant to this Article 17(a); provided that such
Participant (A) agrees to be subject to the provisions of Article 3 as if it
were an Assignee under this Article 17(a), and (B) shall not be entitled to
receive any greater payment under Article 3(o) or Article 3(q), with respect to
any participation, than its participating Buyer or Assignee, as applicable,
would have been entitled to receive, except to the extent such entitlement to
receive a greater payment results from the adoption of or any change in any
Requirement of Law or in the interpretation or application thereof by a
Governmental Authority, in any case which occurs after the Participant acquired
the applicable participation. Each Buyer or Assignee that sells a participation
agrees to use reasonable efforts to cooperate with Sellers to effectuate the
provisions of Article 3 with respect to the applicable Participant.

(b) Title to all Purchased Assets and Purchased Items shall pass to Buyer and
Buyer shall have free and unrestricted use of all Purchased Assets. Nothing in
this Agreement shall preclude Buyer from engaging in repurchase transactions
with the Purchased Assets and Purchased Items or otherwise selling, pledging,
repledging, transferring, hypothecating, or rehypothecating the Purchased Assets
and Purchased Items, all on terms that Buyer may determine in its sole
discretion other than with respect to repurchase transactions or sales, pledges,
repledges, transfers, hypothecations, or rehypothecations to Prohibited
Transferees, which shall be subject to the prior written consent of the
applicable Seller; provided, however, that Buyer shall transfer the applicable
Purchased Assets to the related Seller on the applicable Repurchase Date free
and clear of any pledge, lien, security interest, encumbrance, charge or other
adverse claim on any of the Purchased Assets. Nothing contained in this
Agreement shall obligate Buyer to segregate any Purchased Assets or Purchased
Items transferred to Buyer by the applicable Seller.

(c) Buyer, acting for this purpose as an agent of the applicable Seller, shall
maintain at one of its offices a register for the recordation of the names and
addresses of Buyer, and the percentage of the rights and obligations under this
Agreement owing to, Buyer and each Transferee pursuant to the terms hereof from
time to time (the “Register”). The entries in the Register shall be conclusive,
and each Seller, Buyer, and each Transferee shall treat each Person whose name
is recorded in the Register pursuant to the terms hereof as a Buyer or
Transferee, as applicable, hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary. The Register shall be available for
inspection by either Seller at any reasonable time and from time to time upon
reasonable prior notice; provided that Buyer shall have no obligation to
disclose all or any portion of the Register regarding Participants (including
the identity of any Participant or any information relating to a Participant’s
beneficial interest in this Agreement) to any Person except to the extent that
such disclosure is necessary to establish that such beneficial interest in this
Agreement or other obligation is in registered form under Section 5f.103-1(c) of
the United States Treasury Regulations. The entries in the Register shall be
conclusive absent manifest error, and Buyer shall treat each Person whose name
is recorded in the Register as the owner of its respective interest for all
purposes of this Agreement notwithstanding any notice to the contrary. No sale,
assignment, transfer or participation pursuant to this Article 17 shall be
effective until reflected in the Register.

 

87

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

ARTICLE 18.

GOVERNING LAW

THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK PURSUANT TO SECTION 5-1401 OF THE NEW YORK GENERAL
OBLIGATIONS LAW WITHOUT GIVING EFFECT TO THE CONFLICT OF LAW PRINCIPLES THEREOF.

ARTICLE 19.

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 Articles 4(a) or 4(b) hereof will not constitute a waiver
of any right to do so at a later date.

ARTICLE 20.

USE OF EMPLOYEE PLAN ASSETS

(a) If assets of an employee benefit plan subject to any provision of 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 or is otherwise exempt
therefrom, 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 Article 20, any
such Transaction shall proceed only if the applicable Seller furnishes or has
furnished to Buyer its most recent available audited statement of its financial
condition and its most recent subsequent unaudited statement of its financial
condition.

(c) By entering into a Transaction or a related Additional Purchase Transaction
or Future Funding Transaction, pursuant to this Article 20, the applicable
Seller shall be deemed (i) to represent to Buyer that since the date of such
Seller’s latest such financial statements, there has been no material adverse
change in such Seller’s financial condition that such 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 such
Seller in any outstanding Transaction involving a Plan Party.

 

88

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

ARTICLE 21.

INTENT

(a) The parties intend and recognize that each Transaction is a “repurchase
agreement” as that term is defined in Section 101(47) of the Bankruptcy Code
(except insofar as the type of Assets subject to such Transaction or the term of
such Transaction would render such definition inapplicable), and a “securities
contract” as that term is defined in Section 741 of the Bankruptcy Code (except
insofar as the type of assets subject to such Transaction would render such
definition inapplicable). The Parties intend (a) for each Transaction to qualify
for the safe harbor treatment provided by the Bankruptcy Code and for Buyer to
be entitled to all of the rights, benefits and protections afforded to Persons
under the Bankruptcy Code with respect to a “repurchase agreement” as defined in
Section 101(47) of the Bankruptcy Code and a “securities contract” as defined in
Section 741(7) of the Bankruptcy Code and that payments under this Agreement are
deemed “margin payments” or “settlement payments,” as defined in Section 741 of
the Bankruptcy Code, (b) for the grant of a security interest set forth in
Article 6 to also be a “securities contract” as defined in Section 741(7)(A)(xi)
of the Bankruptcy Code and a “repurchase agreement” as that term is defined in
Section 101(47)(A)(v) of the Bankruptcy Code, and (c) that each party (for so
long as each is either a “financial institution,” “financial participant,” “repo
participant,” “master netting participant” or other entity listed in
Section 546, 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 Article 12 and in Section 555, 559 and 561 of the Bankruptcy Code, to
liquidate the Purchased Assets and terminate this Agreement, and (y) the right
to offset or net out as set forth in Article 12 and in Sections 362(b)(6), 362
(b)(7), 362(b)(27), 362(o) and 546 of the Bankruptcy Code. 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) 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 Article 12
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.

(c) 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 Transaction hereunder is a
“qualified financial contract,” as that term is defined in the FDIA and any
rules, orders or policy statements thereunder (except insofar as the type of
assets subject to such Transaction would render such definition inapplicable).

 

89

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

(d) Each party hereto hereby further agrees that it shall not challenge the
characterization of (i) this Agreement or any Transaction 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 the type of Asset subject to the Transactions or, in the
case of a “repurchase agreement,” the term of the Transactions, would render
such definition inapplicable.

(e) It is understood 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 any Transaction 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).

(f) It is understood that this Agreement constitutes a “master netting
agreement” as defined in Section 101(38A) of the Bankruptcy Code, and as used in
Section 561 of the Bankruptcy Code.

(g) Notwithstanding anything herein to the contrary, it is the intention of the
parties that, for U.S. Federal, state and local income and franchise tax
purposes and for accounting purposes, each Transaction constitute a financing,
and that the applicable Seller be (except to the extent that Buyer shall have
exercised its remedies following an Event of Default) the owner of the Purchased
Assets for such purposes. Unless prohibited by applicable law, each Seller and
Buyer shall treat the Transactions as described in the preceding sentence
(including on any and all filings with any U.S. Federal, state, or local taxing
authority) and agree not to take any action inconsistent with such treatment.

ARTICLE 22.

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, 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 Exchange 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

 

90

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

(d) In the case of Transactions in which one of the parties is an “insured
depository institution”, as that term is defined in Section 1813(c)(2) of Title
12 of the United States Code, funds held by the financial institution pursuant
to a Transaction are not a deposit and therefore are not insured by the Federal
Deposit Insurance Corporation, the Savings Association Insurance Fund or the
Bank Insurance Fund, as applicable.

ARTICLE 23.

CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL

(a) Each party irrevocably and unconditionally (i) submits to the non-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 each 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 Article 23 shall affect the right of Buyer to
serve legal process in any other manner permitted by law or affect the right of
Buyer to bring any action or proceeding against either Seller 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.

ARTICLE 24.

NO RELIANCE

Each Seller and Buyer 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;

 

91

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

(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, guarantee 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.

ARTICLE 25.

INDEMNITY

Each Seller hereby agrees to indemnify Buyer, Buyer’s Affiliates 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
attorneys’ fees and disbursements) or disbursements (all of the foregoing,
collectively “Indemnified Amounts”) that 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 hereunder or any action
taken or omitted to be taken by any Indemnified Party under or in connection
with any of the foregoing; provided, that neither Seller shall be liable for
losses resulting from the gross negligence, bad faith or willful misconduct of
Buyer or any other Indemnified Party. Without limiting the generality of the
foregoing, each Seller agrees to hold Buyer harmless from and indemnify Buyer
against all Indemnified Amounts with respect to all Purchased Assets 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; provided, that neither Seller shall be liable for losses resulting from the
gross negligence, bad faith or willful misconduct of Buyer or any other
Indemnified Party. In any suit, proceeding or action

 

92

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

brought by Buyer in connection with any Purchased Asset for any sum owing
thereunder, or to enforce any provisions of any Purchased Asset, each Seller
will save, indemnify and hold Buyer harmless from and against all out-of-pocket
expense (including reasonable attorneys’ fees of outside counsel), 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 either 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 either Seller.
Each Seller also agrees to reimburse Buyer as and when billed by Buyer for all
Buyer’s reasonable out-of-pocket costs and expenses incurred in connection with
Buyer’s due diligence reviews with respect to the Purchased Assets (including,
without limitation, those incurred pursuant to Article 26 and Article 3
(including, without limitation, all Due Diligence Legal Expenses, even if the
underlying prospective Transaction for which they were incurred does not take
place for any reason) and the enforcement or the preservation of Buyer’s rights
under this Agreement, any Transaction Documents or Transaction contemplated
hereby, including without limitation the reasonable fees and disbursements of
its outside counsel. Each Seller hereby acknowledges that the obligation of such
Seller hereunder is a recourse obligation of Seller. This Article 25 shall not
apply with respect to Taxes other than any Taxes that represent losses, claims
or damages arising from any non-Tax claim.

ARTICLE 26.

DUE DILIGENCE

Each Seller acknowledges that Buyer has the right to perform continuing due
diligence reviews with respect to the Purchased Assets, for purposes of
verifying compliance with the representations, warranties and specifications
made hereunder, or otherwise, and such Seller agrees that upon reasonable prior
notice to such Seller, Buyer or its authorized representatives will be permitted
during normal business hours to examine, inspect, and make copies and extracts
of, the Purchased Asset Files, Servicing Records and any and all documents,
records, agreements, instruments or information relating to such Purchased
Assets in the possession or under the control of such Seller, any servicer or
subservicer and/or the Custodian. Each Seller agrees to reimburse Buyer for any
and all reasonable out-of-pocket costs and expenses incurred by Buyer with
respect to the Purchased Assets during the term of this Agreement, which shall
be paid by such Seller to Buyer within five (5) days after receipt of an invoice
therefor. Each Seller also shall make available to Buyer a knowledgeable
financial or accounting officer for the purpose of answering questions
respecting the Purchased Asset Files and the Purchased Assets. Without limiting
the generality of the foregoing, each Seller acknowledges that Buyer may enter
into Transactions with such Seller based solely upon the information provided by
such 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 Assets.
Buyer may underwrite such Purchased Assets itself or engage a third party
underwriter to perform such underwriting. Each Seller agrees to cooperate with
Buyer and any third party underwriter 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 Assets in the possession, or under the
control, of such Seller. Each Seller further agrees that Seller shall reimburse
Buyer for any and all attorneys’ fees, costs and expenses incurred by Buyer in
connection with continuing due diligence on Eligible Assets and Purchased
Assets.

 

93

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

ARTICLE 27.

SERVICING

(a) Each servicer of any Purchased Asset (including the Interim Servicer) shall
service the Purchased Assets for the benefit of Buyer and Buyer’s successors and
assigns. Each Seller shall cause each such servicer (including the Interim
Servicer) to service the Purchased Assets at such Seller’s sole cost and for the
benefit of Buyer in accordance with Accepted Servicing Practices; provided that,
without prior written consent of Buyer in its sole discretion as required by
Article 7(d), no servicer (including the Interim Servicer and the primary
servicer) of any of the Purchased Assets shall take any action with respect to
any Purchased Asset described in Article 7(d).

(b) Each Seller agrees that Buyer is the owner of all servicing records,
including but not limited to any and all servicing agreements and pooling and
servicing agreements (including, without limitation each Interim Servicing
Agreement or any other servicing agreement relating to the servicing of any or
all of the Purchased Assets) (collectively, the “Servicing Agreements”), 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 Assets (the “Servicing Records”) so long
as the Purchased Assets are subject to this Agreement. Each Seller covenants to
safeguard such Servicing Records and to deliver them promptly to Buyer or its
designee (including the Custodian) at Buyer’s request. Sellers shall cause each
Foreign Purchased Asset to be serviced by a servicer acceptable to Buyer and in
accordance with a Servicing Agreement in the form set forth in Exhibit XVII
hereto.

(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 Assets on a
servicing released basis and/or (ii) terminate Seller (as the servicer), the
Interim Servicer or any other servicer or sub-servicer of the Purchased Assets
with or without cause, in each case without payment of any termination fee.

(d) Neither Seller shall employ sub-servicers or any other servicers other than
the Interim Servicer pursuant to the applicable Interim Servicing Agreement to
service the Purchased Assets without the prior written approval of Buyer, in
Buyer’s sole discretion. If the Purchased Assets are serviced by a sub-servicer
or any other servicer, the applicable Seller shall, irrevocably assign all
rights, title and interest (if any) in the servicing agreements in the related
Purchased Assets to Buyer. Each Seller shall cause all servicers (other than the
Interim Servicer) and sub-servicers engaged by such Seller to execute the
Servicer Notice with Buyer acknowledging Buyer’s security interest and agreeing
that each servicer and/or sub-servicer shall immediately transfer all Income and
other amounts with respect to the Purchased Assets in accordance with the
applicable Servicing Agreement and so long as any Purchased Asset is owned by
Buyer hereunder, following notice from Buyer to such Seller and each such
servicer of an Event of Default under this Agreement, each such servicer
(including the Interim Servicer) or sub-servicer shall take no action with
regard to such Purchased Asset other than as specifically

 

94

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

directed by Buyer. Each Seller shall cause each Servicing Agreement (including
each Interim Servicing Agreement) to be consistent with the terms of this
Agreement and each Servicer (including the Interim Servicer) to comply with such
terms.

(e) The payment of servicing fees shall be subordinate to payment of amounts
outstanding under any Transaction and this Agreement.

(f) For the avoidance of doubt, each Seller retains no economic rights to the
servicing, other than such Seller’s rights under the applicable Interim
Servicing Agreement. As such, each Seller expressly acknowledges that the
Purchased Assets are sold to Buyer on a “servicing released” basis with such
servicing retained by the Servicer.

(g) Each Seller shall cause each servicer of a Purchased Asset to provide to
Buyer, the Interim Servicer, and to the Custodian via electronic transmission,
promptly upon request by Buyer a Servicing Tape for the month (or any portion
thereof) prior to the date of Buyer’s request; provided, that to the extent any
servicer does not provide any such Servicing Tape, such Seller shall prepare and
provide to Buyer, the Interim Servicer and Custodian via electronic transmission
a remittance report containing the servicing information that would otherwise be
set forth in the Servicing Tape; and provided, further, that regardless of
whether such Seller at any time delivers any such remittance report, such Seller
shall at all times use commercially reasonable efforts to cause each servicer to
provide each Servicing Tape in accordance herewith.

ARTICLE 28.

MISCELLANEOUS

(a) Each Seller hereby acknowledges and agrees that Buyer may either securitize
or participate, syndicate or otherwise sell interests in the Transactions, any
Transaction and/or any portion thereof (any such transaction, a “Secondary
Market Transaction”). To the extent Buyer desires to implement any Secondary
Market Transaction, each Seller agrees to reasonably cooperate with Buyer, at
Buyer’s sole cost and expense (including, without limitation, Buyer’s attorneys’
fees and costs and such Seller’s reasonable attorneys’ fees and costs), to plan,
structure, negotiate, implement and execute such Secondary Market Transaction;
provided that such Secondary Market Transaction has no material adverse tax
consequence on such Seller or their direct or indirect owners. Each Seller
hereby further acknowledges and agrees that (i) Buyer reserves the right to
convert any Transaction or Transactions (or any portion thereof) at any time
(including in connection with a Secondary Market Transaction) to components,
pari passu financing or subordinate financing, including one or more tranches of
preferred equity, subordinate debt, multiple notes, or participation interests,
each subordinate to such loan (“Subordinate Financing”, and the senior portion
of any such Subordinate Financing, the “Senior Tranche”), and (ii) any such
Subordinate Financing shall have individual coupon rates that, when blended with
the Senior Tranche in the aggregate, shall initially equal the Price
Differential. Each Seller acknowledges and agrees that the terms of any such
Subordinate Financing will provide that a default under the Senior Tranche shall
be a default under the respective Subordinate Financing. Each Seller consents to
disclosure by Buyer or any of its Affiliates of the Purchased Assets, collateral
therefor and such Seller’s and its Affiliates’ and/or principals’ operating and
financial statements in connection with the servicing of any Purchased Assets
and any Secondary Market Transaction.

 

95

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

(b) 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.

(c) 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.

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

(e) Without limiting the rights and remedies of Buyer under the Transaction
Documents, each Seller shall pay Buyer’s reasonable actual out-of-pocket costs
and expenses, including reasonable fees and expenses of 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, whether or not such
Transaction Document (or amendment thereto) or Transaction is ultimately
consummated. Each Seller agrees to pay Buyer on demand 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 such Seller in respect of the Purchased Assets, or
any actual or attempted sale, or any exchange, enforcement, collection,
compromise or settlement in respect of any of the Purchased Items and for the
custody, care or preservation of the Purchased Items (including insurance costs)
and defending or asserting rights and claims of Buyer in respect thereof, by
litigation or otherwise. In addition, each Seller agrees to pay Buyer on demand
all reasonable costs and expenses (including reasonable expenses for legal
services) incurred in connection with the maintenance of each Depository Account
and registering the Purchased Items in the name of Buyer or its nominee. All
such expenses shall be recourse obligations of the applicable Seller to Buyer
under this Agreement. This Article 28(e) shall not apply with respect to Taxes
other than any Taxes that represent losses, claims or damages arising from any
non-Tax claim.

(f) In addition to any rights now or hereafter granted under applicable law or
otherwise, and not by way of limitation of such rights, each Seller hereby
grants to Buyer and its Affiliates a right of offset, to secure repayment of all
amounts owing to Buyer or its Affiliates by such Seller under the Transaction
Documents, upon any and all monies, securities, collateral or other property of
such Seller and the proceeds therefrom, now or hereafter held or received by
Buyer or its Affiliates or any entity under the Control of Buyer or its
Affiliates and its respective successors and assigns (including, without
limitation, branches and agencies of Buyer, wherever located), for the account
of such Seller, whether for safekeeping, custody, pledge, transmission,
collection, or otherwise, and also upon any and all deposits (general or
specified) and credits of such Seller at any time existing. Buyer and its
Affiliates are hereby authorized at any time and from time to time upon the
occurrence and during the continuance of an Event of Default, without notice to
such Seller, to offset, appropriate, apply and enforce such right of offset
against any and all items hereinabove referred to against any amounts owing to
Buyer or its Affiliates by

 

96

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

such Seller thereof under the Transaction Documents or any other agreement,
irrespective of whether Buyer or its Affiliates shall have made any demand
hereunder and although such amounts, or any of them, shall be contingent or
unmatured and regardless of any other collateral securing such amounts. Each
Seller shall be deemed directly indebted to Buyer and its Affiliates in the full
amount of all amounts owing to Buyer and its Affiliates by such Seller under the
Transaction Documents or any other agreement, and Buyer and its Affiliates shall
be entitled to exercise the rights of offset provided for above. ANY AND ALL
RIGHTS TO REQUIRE BUYER OR ITS AFFILIATES TO EXERCISE THEIR RIGHTS OR REMEDIES
WITH RESPECT TO ANY OTHER COLLATERAL OR PURCHASED ITEMS THAT SECURE THE AMOUNTS
OWING TO BUYER OR ITS AFFILIATES BY SUCH SELLER UNDER THE TRANSACTION DOCUMENTS,
PRIOR TO EXERCISING THEIR RIGHT OF OFFSET WITH RESPECT TO SUCH MONIES,
SECURITIES, COLLATERAL, DEPOSITS, CREDITS OR OTHER PROPERTY OF SUCH SELLER, ARE
HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED BY SUCH SELLER.

(g) 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.

(h) 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.

(i) 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.

(j) 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.

(k) Wherever pursuant to this Agreement, Buyer exercises any right given to it
to consent or not consent, or to approve or disapprove, or any arrangement or
term is to be satisfactory to, Buyer in its sole discretion, Buyer shall decide
to consent or not consent, or to approve or disapprove or to decide that
arrangements or terms are satisfactory or not satisfactory, in its sole and
absolute discretion and such decision by Buyer shall be final and conclusive.

(l) Each Affiliated Hedge Counterparty is an intended third party beneficiary of
this Agreement and the parties hereto agree that this Agreement shall not be
amended or otherwise modified without the written consent of each Affiliated
Hedge Counterparty, such consent not to be unreasonably withheld.

 

97

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

ARTICLE 29.

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
Requirements of Law for all Repurchase Obligations, (ii) until all Repurchase
Obligations shall have been paid in full and the expiration of any applicable
preference or similar period pursuant to any Insolvency Law, or at law or in
equity, has expired, the liability of each Seller (A) shall be absolute and
unconditional and shall remain in full force and effect (and, if suspended or
terminated, shall be reinstated) and, for the avoidance of doubt, such liability
shall be absolute and unconditional and shall remain in full force and effect
even if Buyer shall not make a claim before the expiration of such period
asserting an interest in all or any part of any payment(s) received by Buyer,
and (B) shall not be discharged, affected, modified or impaired on the
occurrence from time to time of any event, including, but limited to, any of the
following events, whether or not with notice to, or the consent of, each or any
Seller: (1) the waiver, forbearance, compromise, settlement, release,
termination, modification or amendment (including, but not limited to, any
extension or postponement of the time for payment or performance or renewal or
refinancing) of any of the Repurchase Obligations, (2) the failure to give
notice to each or any Seller of the occurrence of a Default or an Event of
Default, (3) the release, substitution or exchange by Buyer of any Purchased
Asset (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 nonperfection, subordination of
priority (whether at law or equity) or any other impairment of any collateral,
(4) the full or partial release of, or waiver or forbearance from enforcing any
rights against, any Person primarily or secondarily liable for payment or
performance of all or any part of the Repurchase Obligations, whether or not by
Buyer, and whether or not in connection with any Insolvency Proceeding affecting
any Seller or any other Person, has (x) any obligations in respect of the
Repurchase Obligations or any part thereof, or (y) granted any security interest
in any of its collateral as security for any of the Repurchase Obligations, or
(5) to the extent permitted by Requirements of Law, any other event, occurrence,
action or circumstance that would, in the absence of this Article 29, result in
the release or discharge, in whole or in part, of any or all of Sellers from the
payment, performance or observance of any Repurchase Obligation, (iii) Buyer
shall not be required first to initiate any suit or to attempt to enforce or
exhaust its remedies against any Seller or any other Person, in order to enforce
the Transaction Documents or seek payment and/or performance of any or all of
the Repurchase Obligations against any Seller and each Seller expressly agrees
that, notwithstanding the occurrence of any of the foregoing, each Seller is and
shall remain directly and primarily liable for all sums due under any of the
Transaction Documents, including, but not limited to, all of the Repurchase
Obligations, (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 (x) any failure by Buyer to make any such demand, enforce or attempt
to enforce any of Buyer’s rights, or collect or attempt to collect any payments
from any other Seller, or (y) any release by Buyer of any other Seller shall
not, in either case, relieve any Seller of its obligations or liabilities
hereunder or under any other Transaction Document, and shall not impair or
affect

 

98

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

the rights and remedies, express or implied, or as a matter of law or equity, of
Buyer against any Seller or all of the Sellers, and (v) on disposition by Buyer
of any collateral securing any of the Repurchase Obligations, each Seller shall
be and shall remain jointly and severally liable for any deficiency up to and
including, with respect to each Seller, the value of the Purchased Assets
purchased from such Seller. It is expressly agreed that Foreign Asset Seller is
liable to Buyer for all obligations of U.S. Seller under the Other Repurchase
Agreement, including, without limitation, the Other Facility Repurchase
Obligations.

(b) Notwithstanding anything in this Agreement or any other Transaction Document
to the contrary, the obligations of each Seller with respect to joint and
several liability hereunder shall be limited to a maximum aggregate amount equal
to the greatest amount that would not render such Seller’s obligations hereunder
subject to avoidance as a fraudulent transfer or conveyance under Section 548 of
Title 11 of the Bankruptcy Code or any provisions of applicable state law
(collectively, the “Fraudulent Transfer Laws”), in each case after giving effect
to all other liabilities of such Seller, contingent or otherwise, that are
relevant under the Fraudulent Transfer laws.

 

99

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

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

 

BUYER:

JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, a national banking association

By:  

/s/ Thomas N. Cassino

Name:   Thomas N. Cassino Title:   Vice President

In its capacity as Other Facility Buyer, and solely for

purposes of acknowledging and agreeing to

Articles 6(d), 6(e), and 6(h) hereof:

 

OTHER FACILITY BUYER:

JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, a national banking association

By:  

/s/ Thomas N. Cassino

Name:   Thomas N. Cassino Title:   Vice President

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

SELLERS:

PARLEX 4 UK FINCO, LLC, a Delaware limited liability company

By:  

Douglas Armer

Name:   Douglas Armer Title:   Head of Capital Markets and Treasurer

 

PARLEX 4 FINANCE, LLC, a Delaware limited liability company

By:  

Douglas Armer

Name:   Douglas Armer Title:   Head of Capital Markets and Treasurer

 

-2-

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

ANNEXES, EXHIBITS AND SCHEDULES

 

ANNEX I    Names and Addresses for Communications between Parties SCHEDULE I   
Prohibited Transferees EXHIBIT I    Form of Confirmation EXHIBIT II   
Authorized Representatives of Sellers EXHIBIT III-A    Monthly Reporting Package
EXHIBIT III-B    Quarterly Reporting Package EXHIBIT III-C    Annual Reporting
Package EXHIBIT IV    Form of Custodial Delivery Certificate EXHIBIT V-A    Form
of Power of Attorney for U.S. Purchased Assets EXHIBIT V-B    Form of Power of
Attorney for Foreign Purchased Assets EXHIBIT VI    Representations and
Warranties Regarding Individual Purchased Assets EXHIBIT VII    Asset
Information EXHIBIT VIII    Purchase Procedures EXHIBIT IX    Form of Bailee
Letter EXHIBIT X    Form of Margin Deficit Notice EXHIBIT XI    Form of Tax
Compliance Certificates EXHIBIT XII    UCC Filing Jurisdictions EXHIBIT XIII   
Form of Servicer Notice EXHIBIT XIV    Form of Release Letter EXHIBIT XV   
Covenant Compliance Certificate EXHIBIT XVI    Form of Re-Direction Letter
EXHIBIT XVII    Form of Servicing Agreement for Foreign Purchased Assets

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

ANNEX I

Names and Addresses for Communications Between Parties

Buyer:

JPMorgan Chase Bank, National Association

4 New York Plaza, 20th Floor

New York, New York 10004

Attention: Ms. Nancy S Alto

Telephone: (212) 623-1989

Fax: (917) 546-2564

With copies to:

JPMorgan Chase Bank, National Association

270 Park Avenue, 10th Floor

New York, New York 10017-2014

Attention: Chuck Y. Lee

Telephone: (212) 834-5467

Fax: (212) 834-6593

and

Cadwalader Wickersham & Taft LLP

227 West Trade Street

Charlotte, North Carolina 28202

Attention: Stuart N. Goldstein, Esq.

Telephone: (704) 348-5258

Fax: (704) 348-5200

Sellers:

Parlex 4 Finance, LLC and Parlex 4 UK Finco, LLC

c/o Blackstone Mortgage Trust, Inc.

345 Park AvenueNew York, NY 10154

Attention: Douglas Armer

Telephone: (212) 583-5000E

mail: BXMTJPMRepo@blackstone.com

With a copy to:

Ropes & Gray LLP

1211 Avenue of the Americas

New York, New York 10036-8704

Attention: David C. Djaha, Esq.

Telephone: (212) 841-0489

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

SCHEDULE I

Prohibited Transferees

All Affiliates, successors and assigns of the entities listed on this Schedule I
and such other Persons indicated by Sellers 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.

 

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.

Brookfield Investment Management Inc.

  

Newcastle Investment Corp.

Cantor Fitzgerald & Co.

  

NorthStar Realty Finance Corp.

CapitalSource Inc.

  

OZ Management LP

Children’s Investment Fund LP

  

Pacific Investment Management Company LLC

Colony Financial, Inc.

  

RAIT Financial Trust

CreXus Investment Corp.

  

Redwood Trust Inc.

Fortress Credit Corp.

  

Rialto Capital Management, LLC

Guggenheim Partners, LLC

  

SL Green Realty Corp.

H/2 Credit Manager LP

  

Square Mile Capital Management, LLC

iStar Financial Inc.

  

Starwood Capital Group

Invesco Ltd.

  

Starwood Property Trust, Inc.

KKR & Co. L.P.

  

TPG Capital Management, L.P.

Ladder Capital Securities LLC

  

Winthrop Capital Management, LLC

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

EXHIBIT I

CONFIRMATION STATEMENT

JPMORGAN CHASE BANK, NATIONAL ASSOCIATION

Ladies and Gentlemen:

[        ] is pleased to deliver our written CONFIRMATION of our agreement to
enter into the Transaction pursuant to which JPMorgan Chase Bank, National
Association shall purchase from us the Purchased Assets identified on the
attached Schedule 1 to this Confirmation pursuant to the Master Repurchase
Agreement, dated as of December 20, 2013 (the “Agreement”), between JPMorgan
Chase Bank, National Association (the “Buyer”) and Parlex 4 UK Finco, LLC and
Parlex 4 Finance, LLC (the “Sellers”) on the following terms. Capitalized terms
used herein without definition have the meanings given in the Agreement.

 

Purchase Date:               , 201   Name of Purchased Asset(s):  
[            ] Aggregate Principal Amount of
Purchased Assets:   [            ] Repurchase Date:   Purchase Price:  
[            ] Market Value:   [            ] LTV:   [            ] Pricing
Rate:   one month LIBOR plus [    ]% Maximum Pricing Rate:   one month LIBOR
plus [    ]% Advance Rate:   [    ]% Maximum Advance Rate:

 

Denomination of Purchased
Asset:

 

[    ]%

 

 

[US$ or Pound Sterling]

Spot Rate:   [            ] Requested Additional Purchase
Amount:   [            ] Requested Future Funding
Amount:   [            ] Governing Agreements:   [            ] Requested
Wire Amount:   $[        ] Requested Fund Date:   [        ] [    ], 201[    ]

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

Wiring
Instructions:

  

[        ]1

Name and
address for
communications:   

Buyer:

 

 

JPMorgan Chase Bank, National Association

4 New York Plaza, 20th Floor

New York, New York 10004

Attention: Ms. Nancy S. Alto

Telephone: (212) 623-1989

Fax: (917) 546-2564

 

With copies to:

 

JPMorgan Chase Bank, National Association

270 Park Avenue, 10th Floor

New York, New York 10017-2014

Attention: Chuck Y. Lee

Telephone: (212) 834-5467

Fax: (212) 834-6593

 

and

 

Cadwalader Wickersham & Taft LLP

227 West Trade Street

Charlotte, North Carolina 28202

Attention: Stuart N. Goldstein, Esq.

Telephone: (704) 348-5258

Fax: (704) 348-5200

 

Sellers:

 

Parlex 4 UK Finco, LLC and Parlex 4 Finance, LLC

c/o Blackstone Mortgage Trust, Inc.

345 Park Avenue

New York, NY 10154

Attention: Douglas Armer

Telephone: (212) 583-5000

Email: BXMTJPMRepo@blackstone.com

 

With a copy to:

 

Ropes & Gray LLP

1211 Avenue of the Americas

New York, New York 10036-8704

Attention: David C. Djaha, Esq.

Telephone: (212) 841-0489

 

 

1 

If wire instructions are to an account other than as specified in
Section 3(b)(v) of the Agreement, the Confirmation shall require the signature
of two Responsible Officers of Seller.

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

[        ] By:       Name:   Title:

AGREED AND ACKNOWLEDGED:

JPMORGAN CHASE BANK, NATIONAL ASSOCIATION

 

By:       Name:   Title:

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

Schedule 1 to Confirmation Statement

 

 

Purchased Assets:

Aggregate Principal Amount:

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

EXHIBIT II

AUTHORIZED REPRESENTATIVES OF SELLERS

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

EXHIBIT III-A

MONTHLY REPORTING PACKAGE

The Monthly Reporting Package shall include, inter alia, the following:

 

  •  

Any and all financial statements, rent rolls or other material information
received from the borrowers related to each Purchased Asset. To the extent that
Seller fails, after diligent efforts, to obtain on a monthly basis such
financial statements, rent rolls and other material information from the
borrowers, Seller shall provide such information to Buyer on a quarterly basis.

 

  •  

A remittance report containing servicing information, including without
limitation, the amount of each periodic payment due, the amount of each periodic
payment received, the date of receipt, the date due, and whether there has been
any material adverse change to the real property, on a loan by loan basis and in
the aggregate, with respect to the Purchased Assets serviced by any servicer
(such remittance report, a “Servicing Tape”), or to the extent any servicer does
not provide any such Servicing Tape, a remittance report containing the
servicing information that would otherwise be set forth in the Servicing Tape.

 

  •  

A listing of all Purchased Assets reflecting the payment status of each
Purchased Asset and any material changes in the financial or other condition of
each Purchased Asset.

 

  •  

A listing of any existing Defaults.

 

  •  

Trustee remittance reports.

 

  •  

All other information as Buyer, from time to time, may reasonably request with
respect to Seller or any Purchased Asset, obligor or Underlying Mortgaged
Property.

 

  •  

A certificate substantially in the form attached hereto as Exhibit XV to this
Agreement (the “Covenant Compliance Certificate”), from a Responsible Officer of
Seller.

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

EXHIBIT III-B

QUARTERLY REPORTING PACKAGE

The Quarterly Reporting Package shall include, inter alia, the following:

 

  •  

Consolidated unaudited financial statements of Guarantor presented fairly in
accordance with GAAP or, if such financial statements being delivered have been
filed with the SEC pursuant to the requirements of the Exchange Act, or similar
state securities laws, presented in accordance with applicable statutory and/or
regulatory requirements and delivered to Buyer within the same time frame as are
required to be filed in accordance with such applicable statutory or regulatory
requirements, in either case accompanied by a Covenant Compliance Certificate,
including a statement of operations and a statement of changes in cash flows for
such quarter and statement of net assets as of the end of such quarter, and
certified as being true and correct by a Covenant Compliance Certificate.

 

-2-

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

EXHIBIT III-C

ANNUAL REPORTING PACKAGE

The Annual Reporting Package shall include, inter alia, the following:

 

  •  

Guarantor’s consolidated audited financial statements, prepared by a nationally
recognized independent certified public accounting firm and presented fairly in
accordance with GAAP or, if such financial statements being delivered have been
filed with the SEC pursuant to the requirements of the Exchange Act, or similar
state securities laws, presented in accordance with applicable statutory and/or
regulatory requirements and delivered to Buyer within the same time frame as are
required to be filed in accordance with such applicable statutory and/or
regulatory requirements, in either case accompanied by a Covenant Compliance
Certificate, including a statement of operations and a statement of changes in
cash flows for such quarter and statement of net assets as of the end of such
quarter accompanied by an unqualified report of the nationally recognized
independent certified public accounting firm that prepared them.

 

-3-

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

EXHIBIT IV

FORM OF CUSTODIAL DELIVERY CERTIFICATE

On this [    ] day of [        ], 201[    ], [        ], a Delaware limited
liability company, as a Seller (“Seller”) under that certain Master Repurchase
Agreement, dated as of December 20, 2013 (as amended, modified or supplemented
from time to time, the “Repurchase Agreement”) between JPMorgan Chase Bank,
National Association (“Buyer”) and Seller, does hereby deliver to the documents
comprising the Purchased Asset File and listed on Exhibit B hereto with respect
to the Purchased Asset identified in Exhibit A hereto to (a) [        ] (the
“Bailee”), for Bailee to hold for the benefit of Buyer for delivery to the
Custodian (as defined below) and pursuant to that certain Bailee Agreement,
dated as of the date hereof between Seller, Buyer, and Bailee, and (b) U.S. Bank
National Association (“Custodian”), as custodian under that certain Custodial
Agreement, dated as of December 20, 2013 (as amended, modified or supplemented
from time to time, the “Custodial Agreement”), among Buyer, Custodian and
Seller. Seller hereby instructs the Bailee to comply with the Bailee Letter and
the Custodian to comply with the Custodial Agreement, in each case, holding the
Purchased Asset File for the benefit of Buyer.

With respect to the Purchased Asset Files delivered hereby, for the purposes of
issuing the Trust Receipt, the Custodian shall review the Purchased Asset Files
to ascertain delivery of the documents listed in Section 3 of the Custodial
Agreement.

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

IN WITNESS WHEREOF, Seller has caused its name to be signed hereto by its
officer thereunto duly authorized as of the day and year first above written.

 

[                            ] By:  

 

  Name:   Title:

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

Exhibit A

PURCHASED ASSET SCHEDULE

For each Purchased Asset set forth below, Seller shall provide, as applicable,
the following information:

 

  A.

Loan Number:

 

  B.

Obligor Name:

 

  C.

Property Name and Address:

 

  D.

Original Balance:

 

  E.

Maturity Date:

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

Exhibit B

PURCHASED ASSET FILE

 

    

DOCUMENT NAME

  

REQ’D2

  

DEL’D3

  

STATUS4

  

COMMENTS5

1.

              

2.

              

3.

              

4.

              

5.

              

 

2 

Seller to indicate whether the document is required to be delivered.

 

3 

Seller to indicate whether the document is being delivered (applies to this
delivery only – do not mark if documents were previously delivered).

 

4 

Seller to indicate whether the document is an original, certified copy or copy.
For recordable documents, indicate if document is recorded, sent for
recordation, not sent for recordation.

 

5 

Seller may indicate any relevant comments.

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

EXHIBIT V-A

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

Know All Men by These Presents, that Parlex 4 Finance, LLC, a Delaware limited
liability company (“Seller”), does hereby appoint JPMorgan Chase Bank, National
Association (“Buyer”), its attorney-in-fact to act in Seller’s name, place and
stead in any way that Seller could do with respect to (i) complete the
endorsements of the Purchased Assets, including without limitation the Mortgage
Notes, Assignments of Mortgages, Mezzanine Notes, Participation Certificates and
assignments of participation interests and any transfer documents related
thereto, (ii) record the Assignments of Mortgages, (iii) prepare and file and
record each Assignment of Mortgage or other assignment, (iii) take any action
(including exercising voting and/or consent rights) with respect to any
participation interest, (iv) complete the preparation and filing, in form and
substance satisfactory to Buyer, of such financing statements, continuation
statements, and other UCC forms, as Buyer may from time to time, reasonably
consider necessary to create, perfect, and preserve Buyer’s security interest in
the Purchased Assets, (v) enforce Seller’s rights under the Purchased Assets
purchased by Buyer pursuant to this Agreement, and (vi) to take such other steps
as may be necessary or desirable to enforce Buyer’s rights against, under or
with respect to such Purchased Assets and the related Purchased Asset Files and
the Servicing Records and (iv) the enforcement of Seller’s rights under the
Purchased Assets purchased by Buyer pursuant to the Master Repurchase Agreement
dated as of December 20, 2013 (the “Repurchase Agreement”), between Buyer and
Sellers, and to take such other steps as may be necessary or desirable to
enforce Buyer’s rights against such Purchased Assets, the related Purchased
Asset Files and the Servicing Records to the extent that Seller is permitted by
law to act through an agent; provided that Buyer 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.

TO INDUCE ANY THIRD PARTY TO ACT HEREUNDER, SELLER HEREBY AGREES THAT ANY THIRD
PARTY RECEIVING A DULY EXECUTED COPY OR 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 INDEMNIFY AND
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.

THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK PURSUANT TO SECTION 5-1401 OF THE NEW YORK GENERAL
OBLIGATIONS LAW.

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

IN WITNESS WHEREOF Seller has caused this Power of Attorney to be executed as a
deed this 20th day of December, 2013.

 

[                            ] By:  

 

  Name:   Title:

 

-2-

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

EXHIBIT V-B

FORM OF POWER OF ATTORNEY FOR FOREIGN PURCHASED ASSETS

THIS POWER OF ATTORNEY is made and given on December 20, 2013, by Parlex 4 UK
Finco, LLC, a limited liability company incorporated under the laws of Delaware
whose registered office is at [        ] (the “Seller”) in favour of JPMorgan
Chase Bank, National Association, whose registered office is at [        ] (the
“Attorney”), for the purposes and on the terms hereinafter set forth.

 

(A)

By a Master Repurchase Agreement dated December 20, 2013 (the “Agreement”), the
Seller agreed to sell, and the Attorney agreed to purchase, the Purchased Assets
on terms requiring the Seller to repurchase the same on the terms set out
therein.

 

(B)

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

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

 

(a)

date and deliver to the facility agent for execution any Transfer Certificate
executed by the Seller,

 

(b)

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

 

(c)

complete the preparation and filing, in form and substance satisfactory to
Buyer, of such financing statements, continuation statements, and other UCC
forms, as Buyer may from time to time, reasonably consider necessary to create,
perfect, and preserve Buyer’s security interest in the Purchased Assets,

 

(d)

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

 

(e)

to take such other steps as may be necessary or desirable to enforce Buyer’s
rights against, under or with respect to such Purchased Assets and the related
Purchased Asset Files and the Servicing Records or to enforce the Seller’s
rights under the Purchased Assets 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 the 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.

THE 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
English law.

IN WITNESS WHEREOF Seller has caused this Power of Attorney to be executed as a
deed this     day of December, 2013.

 

[                            ] By:  

 

  Name:   Title:

 

-2-

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

EXHIBIT VI

REPRESENTATIONS AND WARRANTIES

REGARDING EACH INDIVIDUAL PURCHASED ASSET

THAT IS A SENIOR MORTGAGE LOAN

(OTHER THAN A PARTICIPATION INTEREST)

(a) As applicable, each Purchased Asset is either a whole loan and not a
participation interest in a whole loan or an A-note interest or a senior ranking
interest in a whole loan. The sale of the Purchased Assets to Buyer or its
designee does not require Seller to obtain any governmental or regulatory
approval or consent that has not been obtained. It being understood that B-notes
secured by the same Mortgage as a Senior Mortgage Loan are not subordinate
mortgages or junior liens, there are no subordinate mortgages or junior liens
encumbering the related Underlying Mortgaged Property. Seller has no knowledge
of any mezzanine debt related to the Underlying Mortgaged Property and secured
directly by the ownership interests in the Mortgagor.

(b) No Purchased Asset is 30 days or more delinquent in payment of principal and
interest (without giving effect to any applicable grace period) and no Purchased
Asset has been 30 days or more (without giving effect to any applicable grace
period in the related Mortgage Note or, with respect to Foreign Purchased
Assets, the obligations set forth in the Foreign Finance Documents) past due.

(c) Except with respect to the ARD Loans, which provide that the rate at which
interest accrues thereon increases after the Anticipated Repayment Date, the
Purchased Assets (exclusive of any default interest, late charges or prepayment
premiums) are fixed rate mortgage loans or floating rate mortgage loans with
terms to maturity, at origination or as of the most recent modification, as set
forth in the Purchased Asset Schedule.

(d) The information pertaining to each Purchased Asset set forth on the
Purchased Asset Schedule is true and correct in all material respects as of the
Purchase Date.

(e) At the time of the assignment of the Purchased Assets to Buyer, Seller had
good and marketable title to and was the sole owner and holder of, each
Purchased Asset, free and clear of any pledge, lien, encumbrance or security
interest and such assignment validly and effectively transfers and conveys all
legal and beneficial ownership of the Purchased Assets to Buyer free and clear
of any pledge, lien, charge, encumbrance, participation or security interest,
any other ownership interests and other interests on, in or to such Senior
Mortgage Loan other than any servicing rights appointment, subservicing or
similar agreement. Seller has full right and authority to sell, assign and
transfer each Senior Mortgage Loan, and the assignment to Buyer constitutes a
legal, valid and binding assignment of such Senior Mortgage Loan free and clear
of any and all liens, pledges, charges or security interests of any nature
encumbering such Senior Mortgage Loan subject to the rights and obligations of
Seller pursuant to the Agreement.

(f) To the extent required under applicable law, Seller is authorized to
transact and do business in the jurisdiction in which each Underlying Mortgaged
Property is located, or the failure to be so authorized does not materially and
adversely affect the enforceability of such Senior Mortgage Loan.

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

(g)(i) In respect of each U.S. Purchased Asset, (A) the related 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 and (B) the Mortgagor is
not a debtor in any bankruptcy, receivership, conservatorship, reorganization,
insolvency, moratorium or similar proceeding and (ii) in respect of a Foreign
Purchased Asset, (A) the related Mortgagor is an entity organized under the laws
of England and Wales, Jersey, Guernsey, Luxembourg or another jurisdiction in
which single purpose entities formed for the purposes of investment in mortgaged
properties located in England and Wales are commonly organized.

(h) Each Purchased Asset is secured by (or in the case of a participation
interest, the Underlying Mortgage Loan is secured by) a Mortgage that
establishes and creates a valid and subsisting first priority lien on the
Underlying Mortgaged Property, free and clear of any liens, claims,
encumbrances, participation interests, pledges, charges or security interests
subject only to Permitted Encumbrances. Such Mortgage, together with any
separate security agreement, UCC financing statement, Required Filing or similar
agreement, if any, establishes and creates a first priority security interest in
favor of Seller, or the designated security trustee on behalf of Seller, in all
personal property owned by the Mortgagor that is used in, and is reasonably
necessary to, the operation of the Underlying Mortgaged Property and, to the
extent a security interest may be created therein and perfected by the filing of
a UCC financing statement under the Uniform Commercial Code as in effect in the
relevant jurisdiction or a Required Filing, the proceeds arising from the
Underlying Mortgaged Property and other collateral securing such Purchased
Asset, subject only to Permitted Encumbrances. Each UCC financing statement, if
any, filed with respect to personal property constituting a part of the
Underlying Mortgaged Property and each UCC financing statement assignment, if
any, filed with respect to such financing statement or each Required Filing was
in suitable form for filing in the filing office in which such financing
statement or Required Filing was filed. There exists with respect to such
Underlying Mortgaged Property an assignment of leases and rents provision,
either as part of the related Mortgage or as a separate document or instrument,
which establishes and creates a first priority security interest in and to
leases and rents arising in respect of the Underlying Mortgaged Property subject
only to Permitted Encumbrances. No person other than the related Mortgagor and
the mortgagee owns any interest in any payments due under the related leases.
The related Mortgage or such assignment or other vesting of leases and rents
provision provides for the appointment of a receiver for rents or allows the
holder of the related Mortgage to enter into possession of the Underlying
Mortgaged Property to collect rent or provides for rents to be paid directly to
the holder of the related Mortgage in the event of a default beyond applicable
notice and grace periods, if any, under the related Purchased Asset Documents.
As of the origination date, there are no mechanics’ or other similar liens or
claims that have been filed for work, labor or materials affecting the
Underlying Mortgaged Property that are or may be prior or equal to the lien of
the Mortgage, except those that are insured against pursuant to the applicable
Title Policy (as defined below) with respect to a U.S. Purchased Asset or, with
respect to a Foreign Purchased Asset, that have been disclosed by or on behalf
of the applicable Seller to Buyer in writing prior to the Purchase Date. As of
the Purchase Date, there are no mechanics’ or other similar liens or claims that
have been filed for work, labor or materials affecting the Underlying Mortgaged
Property that are or may be prior or equal in priority to the lien of the
Mortgage,

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

except those that are insured against pursuant to the applicable Title Policy
(as defined below) with respect to a U.S. Purchased Asset or, with respect to a
Foreign Purchased Asset, that have been disclosed by or on behalf of the
applicable Seller to Buyer in writing prior to the Purchase Date. No
(a) Underlying Mortgaged Property secures any mortgage loan not represented on
the Purchased Asset Schedule, (b) Purchased Asset is cross-defaulted with any
other mortgage loan, other than a mortgage loan listed on the Purchased Asset
Schedule, or (c) Purchased Asset is secured by property that is not an
Underlying Mortgaged Property.

(i) The Purchased Asset Documents for each Senior Mortgage Loan that is secured
by a hospitality property operated pursuant to a franchise agreement includes an
executed comfort letter or similar agreement signed by the Mortgagor and
franchisor of such property enforceable against such franchisor, either directly
or as an assignee of the originator. The Mortgage or related security agreement
for each Mortgage Loan secured by a hospitality property creates a security
interest in the revenues of such property for which a UCC financing statement or
Required Filing has been filed in the appropriate filing office.

(j) The related Mortgagor under each Purchased Asset has good and indefeasible
fee simple or, with respect to those Purchased Assets described in clause (ee)
hereof, leasehold title to the Underlying Mortgaged Property comprising real
estate or with respect to those Purchased Assets relating to Underlying
Mortgaged Property located in England and Wales, which Underlying Mortgaged
Property is (A) not registered, is good and marketable title to the fee simple
absolute in possession or a term of years absolute in the relevant Underlying
Mortgaged Property; or (B) registered, is registered, or is in the course of
registration, with title absolute in the case of freehold property or absolute
or good leasehold title in the case of leasehold property, in each case, subject
to any Permitted Encumbrances.

(k) In respect of any U.S. Purchased Asset, Seller has received an American Land
Title Association (ALTA) lender’s title insurance policy or a comparable form of
lender’s title insurance policy (or escrow instructions binding on the Title
Insurer (as defined below) and irrevocably obligating the Title Insurer to issue
such title insurance policy, a title policy commitment or pro-forma “marked up”
at the closing of the related Purchased Asset and countersigned by the Title
Insurer or its authorized agent) as adopted in the applicable jurisdiction (the
“Title Policy”), which was issued by a nationally recognized title insurance
company (the “Title Insurer”) qualified to do business in the jurisdiction where
the Underlying Mortgaged Property is located, covering the portion of each
Underlying Mortgaged Property comprised of real estate and insuring that the
related Mortgage is a valid first lien in the original principal amount of the
related Purchased Asset on the Mortgagor’s fee simple interest (or, if
applicable, leasehold interest) in such Underlying Mortgaged Property comprised
of real estate subject only to Permitted Encumbrances. Such Title Policy was
issued in connection with the origination of the related Purchased Asset. No
claims have been made under such Title Policy. Such Title Policy is in full
force and effect and all premiums thereon have been paid and will provide that
the insured includes the owner of the Purchased Asset and its successors and/or
assigns. No holder of the related Mortgage has done, by act or omission,
anything that would, and Seller has no Knowledge of any other circumstance that
would, impair the coverage under such Title Policy. Each Title Policy contains
no exclusion for, or affirmatively insures (except for any Underlying Mortgaged
Property located in a jurisdiction where such affirmative insurance is not
available in which case such exclusion may exist), (i) that the Underlying

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

Mortgaged Property shown on the survey is the same as the property legally
described in the Mortgage, and (i) to the extent that the Underlying Mortgaged
Property consists of two or more adjoining parcels, such parcels are contiguous.

(l)(i) In respect of any U.S. Purchased Asset, the related Assignment of
Mortgage and the related assignment of the assignment of leases executed in
connection with each Mortgage, if any, have been recorded in the applicable
jurisdiction (or, if not recorded, have been submitted for recording or are in
recordable form) and constitute the legal, valid and binding assignment of such
Mortgage and the related assignment of leases and rents from Seller to Buyer.
The endorsement of the related Mortgage Note by Seller constitutes the legal,
valid, binding and enforceable (except as such enforcement may be limited by
anti-deficiency laws or bankruptcy, receivership, conservatorship,
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)) assignment of such Mortgage Note, and together with such Assignment
of Mortgage and the related assignment of assignment of leases and rents,
legally and validly conveys all right, title and interest in such Purchased
Asset and (except in the case of an A-note or a participation interest) the
Purchased Asset Documents to Buyer, and (ii) in respect of any Foreign Purchased
Asset, the related Foreign Assignment Agreements executed in connection with
such Foreign Purchased Asset, if any, have (where required) been recorded in the
applicable jurisdiction (or, if not recorded, have been submitted for recording
or are in recordable form) and constitute the legal, valid and binding
assignment of the relevant debt claim and the associated rights under the
Foreign Mortgage Loan Security Agreements from the applicable Seller to Buyer
and such agreements legally and validly convey all right, title and interest in
such Foreign Purchased Asset and (except in the case of an A-note or a
participation interest) the Purchased Asset Documents to Buyer.

(m) The Purchased Asset Documents for each U.S. Purchased Asset (or in the case
of a participation interest, the Underlying Mortgage Loan) provide that such
Purchased Asset (or Underlying Mortgage Loan) is non-recourse except that the
related Mortgagor and guarantor that has assets other than equity in the
Underlying Mortgaged Property that are not de minimis and at least one
individual or entity shall be fully liable for actual losses, liabilities, costs
and damages arising from at least the following acts of the related Mortgagor
and/or its principals: (i) if any petition for bankruptcy, insolvency,
dissolution or liquidation pursuant to federal bankruptcy law, or any similar
federal or state law, shall be filed by, consented to, or acquiesced in by, the
Mortgagor; (ii) Mortgagor or guarantor shall have colluded with other creditors
to cause an involuntary bankruptcy filing with respect to the Mortgagor or
(iii) transfers of either the Underlying Mortgaged Property or equity interests
in Mortgagor made in violation of the Purchased Asset Documents; and
(b) contains provisions providing for recourse against the Mortgagor and
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 Underlying Mortgaged Property that are not de minimis), for losses
and damages sustained in the case of (i) (A) misapplication, misappropriation or
conversion of rents, insurance proceeds or condemnation awards, or (B) any
security deposits not delivered to lender upon foreclosure or action in lieu
thereof (except to the extent applied in accordance with leases prior to an
event of default under the Purchased Asset Documents); (ii) the Mortgagor’s
fraud or intentional misrepresentation; (iii) willful misconduct by the
Mortgagor or guarantor; (iv) breaches of the

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

environmental covenants in the Purchased Asset Documents; or (v) commission of
material physical waste at the Underlying Mortgaged Property, which may, with
respect to this clause (v), in certain instances, be limited to acts or
omissions of the related Mortgagor, guarantor, property manager or their
affiliates, employees or agents.

(n) The Purchased Asset Documents for each Purchased Asset contain enforceable
provisions such as to render the rights and remedies of the holder thereof
adequate for the practical realization against the Underlying Mortgaged Property
of the principal benefits of the security intended to be provided thereby (or,
in the case of a Foreign Purchased Asset, either directly by Buyer or indirectly
via a Security Agent), including realization by judicial or, if applicable,
non-judicial foreclosure, and there is no exemption available to the related
Mortgagor that would interfere with such right of foreclosure except (i) any
statutory right of redemption or (ii) any limitation arising under
anti-deficiency laws or by bankruptcy, receivership, conservatorship,
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).

(o) Each of the related Mortgage Notes (with respect to U.S. Purchased Assets)
or the obligations set forth in the Foreign Finance Documents (with respect to
Foreign Purchased Assets) and Mortgages are the legal, valid and binding
obligations of the related Mortgagor named on the Purchased Asset Schedule and
each of the other related Purchased Asset Documents is the legal, valid and
binding obligation of the parties thereto (subject to any non-recourse
provisions therein), enforceable in accordance with its terms, except as such
enforcement may be limited by anti-deficiency laws or bankruptcy, receivership,
conservatorship, 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), and except that certain provisions of such
Purchased Asset Documents are or may be unenforceable in whole or in part under
applicable state or federal laws, but the inclusion of such provisions does not
render any of the Purchased Asset Documents invalid as a whole, and such
Purchased Asset Documents taken as a whole are enforceable to the extent
necessary and customary for the practical realization of the principal rights
and benefits afforded thereby.

(p) The terms of the Purchased Assets or the related Purchased Asset Documents,
(including, in the case of a participation, the documents evidencing the
Underlying Mortgage Loan) have not been altered, impaired, modified or waived in
any material respect, except prior to the Purchase Date by written instrument
duly submitted for recordation, to the extent required, and as specifically set
forth by a document in the related Purchased Asset File.

(q) With respect to each Mortgage that is a deed of trust, 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, and no fees or expenses
are or will become payable to the trustee under the deed of trust, except as
disclosed to Buyer in a Requested Exceptions Report or in connection with a
trustee’s sale after default by the Mortgagor other than de minimis fees paid in
connection with the full or partial release of the Underlying Mortgaged Property
or related security for such Purchased Asset following payment

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

of such Purchased Asset in full. The material terms of such Mortgage and related
Purchased Asset Documents have not been waived, impaired, modified, altered,
satisfied, canceled, subordinated or rescinded in any respect.

(r) No Purchased Asset has been satisfied, canceled, subordinated, released or
rescinded, in whole or in part, and the related Mortgagor has not been released,
in whole or in part, from its obligations under any related Purchased Asset
Document.

(s) Except with respect to the enforceability of any provisions requiring the
payment of default interest, late fees, additional interest, prepayment premiums
or yield maintenance charges, neither the Purchased Asset nor any of the related
Purchased Asset Documents is subject to any right of rescission, set-off,
abatement, diminution, valid counterclaim or defense, including the defense of
usury, including, without limitation, any valid offset, defense, counterclaim or
right based on intentional fraud by Seller in connection with the origination of
the Senior Mortgage Loan, nor will the operation of any of the terms of any such
Purchased Asset Documents, or the exercise (in compliance with procedures
permitted under applicable law) of any right thereunder, render any Purchased
Asset Documents subject to any right of rescission, set-off, abatement,
diminution, valid counterclaim or defense, including the defense of usury
(subject to anti-deficiency or one form of action laws and to bankruptcy,
receivership, conservatorship, reorganization, insolvency, moratorium or other
similar laws affecting the enforcement of creditor’s rights generally and by
general principles of equity (regardless of whether such enforcement is
considered in a proceeding in equity or at law)), and no such right of
rescission, set-off, abatement, diminution, valid counterclaim or defense has
been asserted with respect thereto. None of the Purchased Asset Documents
provides for a release of a portion of the Underlying Mortgaged Property from
the lien of the Mortgage except upon payment or defeasance in full of all
obligations under the Mortgage, provided that, notwithstanding the foregoing,
certain of the Purchased Assets may allow partial release (a) upon payment or
defeasance of an allocated loan amount which may be formula based, but in no
event less than 125% of the allocated loan amount, or (b) in the event the
portion of the Underlying Mortgaged Property being released was not given any
material value in connection with the underwriting or appraisal of the related
Purchased Asset.

(t) As of the Purchase Date, there is no payment default, giving effect to any
applicable notice and/or grace period, and there is no other material default
under any of the related Purchased Asset Documents, giving effect to any
applicable notice and/or grace period; no such material default or breach has
been waived by Seller or on its behalf or, by Seller’s predecessors in interest
with respect to the Purchased Assets; and no event has occurred that, with the
passing of time or giving of notice would constitute a material default or
breach under the related Purchased Asset Documents. No Purchased Asset has been
accelerated and no foreclosure or power of sale proceeding has been initiated in
respect of the related Mortgage. With respect to a U.S. Purchased Asset, Seller
has not waived any material claims against the related Mortgagor under any
non-recourse exceptions contained in the Mortgage Note.

(u) The principal amount of the Purchased Asset stated on the Purchased Asset
Schedule has been fully disbursed as of the Purchase Date (except for certain
amounts that were fully disbursed by the mortgagee, but escrowed pursuant to the
terms of the related Purchased Asset Documents) and there are no future advances
required to be made by the mortgagee under

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

any of the related Purchased Asset Documents. Any requirements under the related
Purchased Asset Documents regarding the completion of any on-site or off-site
improvements and to disbursements of any escrow funds therefor have been or are
being complied with or such escrow funds are still being held. The value of the
Underlying Mortgaged Property relative to the value reflected in the most recent
appraisal thereof is not materially impaired by any improvements that have not
been completed. Seller has not, nor, have any of its agents or predecessors in
interest with respect to the Purchased Assets, in respect of such Purchased
Asset, directly or indirectly, advanced funds or induced, solicited or knowingly
received any advance of funds by a party other than the Mortgagor other than
(a) interest accruing on such Purchased Asset from the date of such disbursement
of such Purchased Asset to the date which preceded by thirty (30) days the first
payment date under the related Mortgage Note or applicable Foreign Finance
Document and (b) application and commitment fees, escrow funds, points and
reimbursements for fees and expenses, incurred in connection with the
origination and funding of the Purchased Asset.

(v) No Purchased Asset has capitalized interest included in its principal
balance, or provides for any shared appreciation rights or other equity
participation therein and no contingent or additional interest contingent on
cash flow or, except for ARD Loans, negative amortization accrues or is due
thereon.

(w) Each U.S. Purchased Asset identified in the Purchased Asset Schedule as an
ARD Loan substantially fully amortizes over its stated term, which term is at
least 60 months after the related Anticipated Repayment Date. Each ARD Loan has
an Anticipated Repayment Date not less than seven years following the
origination of such Purchased Asset. If the related Mortgagor elects not to
prepay its ARD Loan in full on or prior to the Anticipated Repayment Date
pursuant to the existing terms of the U.S. Purchased Asset or a unilateral
option (as defined in Treasury Regulations under Article 1001 of the Code) in
the U.S. Purchased Asset exercisable during the term of the mortgage loan,
(i) the U.S. Purchased Asset’s interest rate will step up to an interest rate
per annum as specified in the related Purchased Asset Documents; provided,
however, that payment of such Excess Interest shall be deferred until the
principal of such ARD Loan has been paid in full; (ii) all or a substantial
portion of the Excess Cash Flow collected after the Anticipated Repayment Date
shall be applied towards the prepayment of such ARD Loan and once the principal
balance of an ARD Loan has been reduced to zero all Excess Cash Flow will be
applied to the payment of accrued Excess Interest; and (iii) if the property
manager for the Underlying Mortgaged Property can be removed by or at the
direction of the mortgagee on the basis of a debt service coverage test, the
subject debt service coverage ratio shall be calculated without taking account
of any increase in the related Mortgage Interest Rate on such Purchased Asset’s
Anticipated Repayment Date. No ARD Loan provides that the property manager for
the Underlying Mortgaged Property can be removed by or at the direction of the
mortgagee solely because of the passage of the related Anticipated Repayment
Date.

(x) Each U.S. Purchased Asset identified in the Purchased Asset Schedule as an
ARD Loan with a hard lockbox requires that tenants at the Underlying Mortgaged
Property shall (and each U.S. Purchased Asset identified in the Purchased Asset
Schedule as an ARD Loan with a springing lockbox requires that tenants at the
Underlying Mortgaged Property shall, upon the occurrence of a specified trigger
event, including, but not limited to, the occurrence of the related Anticipated
Repayment Date) make rent payments into a lockbox controlled by the holder of
the

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

U.S. Purchased Asset and to which the holder of the U.S. Purchased Asset has a
first perfected security interest; provided however, with respect to each ARD
Loan that is secured by a multi-family property with a hard lockbox, or with
respect to each ARD Loan that is secured by a multi-family property with a
springing lockbox, upon the occurrence of a specified trigger event, including,
but not limited to, the occurrence of the related Anticipated Repayment Date,
tenants either pay rents to a lockbox controlled by the holder of the mortgage
loan or deposit rents with the property manager who will then deposit the rents
into a lockbox controlled by the holder of the U.S. Purchased Asset.

(y) The servicing and collection practices used by Seller in respect of each
Senior Mortgage Loan and the terms of the Purchased Asset Documents evidencing
such Purchased Asset comply in all material respects with all applicable laws
including local, state and federal laws, and regulations and Seller has complied
with all material requirements pertaining to the origination, funding and
servicing of the Purchased Assets, including but not limited to, usury and any
and all other material requirements of any laws including federal, state or
local law to the extent non-compliance would have a Material Adverse Effect on
the Purchased Asset and was in all material respects legal, proper and prudent,
in accordance with Seller’s customary commercial mortgage servicing practices.

(z) The Underlying 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 Underlying Mortgaged Property and
applicable zoning laws and all material inspections, licenses, permits and
certificates of occupancy required by law, ordinance or regulation to be made or
issued with regard to the Underlying Mortgaged Property governing the occupancy,
use, and operation of such Underlying Mortgaged Property have been obtained and
are in full force and effect, except to the extent (a) any material
non-compliance with applicable zoning laws is insured by an ALTA lender’s title
insurance policy (or binding commitment therefor), or the equivalent as adopted
in the applicable jurisdiction, or a law and ordinance insurance policy that
provides coverage for additional costs to rebuild and/or repair the property to
current zoning regulations or, with respect to a Foreign Purchased Asset, has
been fully described in the related Property Report, (b) the inability to
restore the Underlying Mortgaged Property to the full extent of the use or
structure immediately prior to the casualty would not materially and adversely
affect the use or operation of such Underlying Mortgaged Property, or title
insurance coverage has been obtained for such nonconformity, 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 Underlying Mortgaged Property as it was used and
operated as of the date of origination of the Purchased Asset or the rights of a
holder of the related Purchased Asset, or (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 Underlying Mortgaged Property
or are insured by applicable provisions of the Title Policy.

(aa) All (a) taxes, water charges, sewer rents, assessments or other similar
outstanding governmental charges and governmental assessments that became due
and owing prior to the Purchase Date in respect of the Underlying Mortgaged
Property (excluding any related personal property), and that if left unpaid,
would be, or might become, a lien on such Underlying Mortgaged Property having
priority over the related Mortgage and (b) insurance premiums or

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

ground rents that became due and owing prior to the Purchase Date in respect of
the Underlying Mortgaged Property (excluding any related personal property),
have been paid, or if any such items are disputed, an escrow of funds in an
amount sufficient (together with escrow payments required to be made prior to
delinquency) to cover such taxes and assessments and any late charges due in
connection therewith has been established. As of the date of origination, the
Underlying Mortgaged Property consisted of one or more separate and complete tax
parcels. For purposes of this representation and warranty, the items identified
herein shall not be considered due and owing until the date on which interest or
penalties would be first payable thereon.

(bb) None of the improvements that were included for the purpose of determining
the appraised value of the Underlying Mortgaged Property at the time of the
origination of such Purchased Asset lies outside the boundaries and building
restriction lines of such Underlying Mortgaged Property, except to the extent
that they are legally nonconforming as contemplated by the representation in
clause (48) below, and no improvements on adjoining properties encroach upon
such Underlying Mortgaged Property, with the exception in each case of
(a) immaterial encroachments that do not materially adversely affect the
security intended to be provided by the related Mortgage or the use, enjoyment,
value or marketability of such Underlying Mortgaged Property or
(b) encroachments affirmatively covered by the related Title Policy. With
respect to each Purchased Asset, the property legally described in the survey,
if any, obtained for the Underlying Mortgaged Property for purposes of the
origination thereof is the same as the property legally described in the
Mortgage. Seller has no knowledge of any material issues with the physical
condition of the Underlying Mortgaged Property that Seller believes would have a
material adverse effect on the use, operation or value of the Underlying
Mortgaged Property other than those disclosed in the engineering or condition
survey report and those addressed in sub-clauses (a) and (b) of the preceding
sentence.

(cc) As of the date of the applicable engineering or condition survey report
(which was performed within 12 months prior to the Purchase Date) related to the
Underlying Mortgaged Property and, as of the Purchase Date, the Underlying
Mortgaged Property is either (i) in good repair, free and clear of any damage
that would materially adversely affect the value of such Underlying Mortgaged
Property as security for such Purchased Asset or the use and operation of the
Underlying Mortgaged Property as it was being used or operated as of the
origination date or (ii) escrows in an amount consistent with the standard
utilized by Seller with respect to similar loans it holds for its own account
have been established, which escrows will in all events be not less than 100% of
the estimated cost of the required repairs. The Underlying Mortgaged Property
has not been damaged by fire, wind or other casualty or physical condition
(including, without limitation, any soil erosion or subsidence or geological
condition), which damage has not either been fully repaired or fully insured, or
for which escrows in an amount consistent with the standard utilized by Seller
with respect to loans it holds for its own account have not been established.

(dd) There are no proceedings pending or threatened, for the partial or total
condemnation of the Underlying Mortgaged Property.

(ee) The Purchased Assets that are identified as being secured in whole or in
part by a leasehold estate (a “Ground Lease”) (except with respect to any
Purchased Asset also secured by the related fee interest in the Underlying
Mortgaged Property), satisfy the following conditions:

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

I.

such Ground Lease or a memorandum thereof has been or will be duly recorded or
registered or submitted for recordation or registration in a form that is
acceptable for recording or registration in the applicable jurisdiction; such
Ground Lease, or other agreement received by the originator of the Purchased
Asset from the ground lessor, provides that the interest of the lessee
thereunder may be encumbered by the related Mortgage and does not restrict the
use of the Underlying Mortgaged Property by such lessee, its successors or
assigns, in a manner that would adversely affect the security provided by the
Mortgage; as of the date of origination of the Purchased Asset (or in the case
of a participation interest, the Underlying Mortgage Loan), there was no
material change of record in the terms of such Ground Lease with the exception
of written instruments that are part of the related Purchased Asset File and
there has been no material change in the terms of such Ground Lease since the
recordation or registration of the related Purchased Asset, with the exception
of written instruments that are part of the related Purchased Asset File;

 

II.

such Ground Lease is not subject to any liens or encumbrances superior to, or of
equal priority with, the related Mortgage, other than the related fee interest
and Permitted Encumbrances and such Ground Lease is, and shall remain, prior to
any mortgage or other lien upon the related fee interest unless a nondisturbance
agreement is obtained from the holder of any mortgage on the fee interest that
is assignable to or for the benefit of the related lessee and the related
mortgagee;

 

III.

such Ground Lease provides that upon foreclosure of the related Mortgage or
assignment of the Mortgagor’s interest in such Ground Lease in lieu thereof, the
mortgagee under such Mortgage is entitled to become the owner of such interest
upon notice to, but without the consent of, the lessor thereunder and, in the
event that such mortgagee becomes the owner of such interest, such interest is
further assignable by such mortgagee and its successors and assigns upon notice
to such lessor, but without a need to obtain the consent of such lessor;

 

IV.

such Ground Lease is in full force and effect and no default of tenant or ground
lessor was in existence at origination, or is currently in existence under such
Ground Lease, nor at origination was, or is there any condition that, but for
the passage of time or the giving of notice, would result in a default under the
terms of such Ground Lease; either such Ground Lease or a separate agreement
contains the ground lessor’s covenant that it shall not amend, modify, cancel or
terminate such Ground Lease without the prior written consent of the mortgagee
under such Mortgage and any amendment, modification, cancellation or termination
of the Ground Lease without the prior written consent of the related mortgagee,
or its successors or assigns is not binding on such mortgagee, or its successor
or assigns;

 

V.

such Ground Lease or other agreement requires that the lessor thereunder will
supply an estoppel and give written notice of any material default by the lessee
to the mortgagee under the related Mortgage, provided that such mortgagee has
provided the lessor with notice of its lien in accordance with the provisions of
such Ground Lease; and such Ground Lease or other agreement provides that no
such notice of default and no termination of the Ground Lease in connection with
such notice of default shall be effective against such mortgagee unless such
notice of default has been given to such mortgagee and any related Ground Lease
contains the ground lessor’s covenant that it will give to the related
mortgagee, or its successors or assigns, any notices it sends to the Mortgagor;

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

VI.

either (i) the related ground lessor has subordinated its interest in the
Underlying Mortgaged Property to the interest of the holder of the Purchased
Asset (or in the case of a participation interest, the Underlying Mortgage Loan)
or (ii) such Ground Lease or other agreement provides that (A) the mortgagee
under the related Mortgage is permitted a reasonable opportunity to cure any
default under such Ground Lease that is curable, including reasonable time to
gain possession of the interest of the lessee under the Ground Lease, after the
receipt of notice of any such default before the lessor thereunder may terminate
such Ground Lease; (B) in the case of any such default that is not curable by
such mortgagee, or in the event of the bankruptcy or insolvency of the lessee
under such Ground Lease, such mortgagee has the right, following termination of
the existing Ground Lease or rejection thereof by a bankruptcy trustee or
similar party, to enter into a new ground lease with the lessor on substantially
the same terms as the existing Ground Lease; and (C) all rights of the Mortgagor
under such Ground Lease may be exercised by or on behalf of such mortgagee under
the related Mortgage upon foreclosure or assignment in lieu of foreclosure or in
the case of any Underlying Mortgaged Property located in England and Wales, the
mortgagee has a right to claim relief from forfeiture of the lease if the lessor
takes steps to forfeit the Ground Lease;

 

VII.

such Ground Lease has an original term (or an original term plus one or more
optional renewal terms that under all circumstances may be exercised, and will
be enforceable, by the mortgagee or its assignee) that extends not less than 20
years beyond the stated maturity date of the related Purchased Asset (or in the
case of a participation interest, of the Underlying Mortgage Loan);

 

VIII.

under the terms of such Ground Lease 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 in respect of a total or
substantially total loss or taking or the portion of the condemnation award
allocable to the ground lessee’s interest (other than in respect of a total or
substantially total loss or taking as addressed in subpart (IX))) will be
applied either to the repair or restoration of all or part of the Underlying
Mortgaged Property, with the mortgagee under such Mortgage or a financially
responsible institution acting as trustee appointed by it, or consented to by
it, or by the lessor having the right to hold and disburse such proceeds as the
repair or restoration progresses (except in such cases where a provision
entitling another party to hold and disburse such proceeds would not be viewed
as commercially unreasonable by a prudent institutional lender), or to the
payment in whole or in part of the outstanding principal balance of such
Purchased Asset together with any accrued and unpaid interest thereon;

 

IX.

in the case of a total or substantial 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 Underlying Mortgaged Property to the extent not
applied to restoration, will be applied first to the payment of the outstanding
principal balance of the Senior Mortgage Loan, together with any accrued
interest;

 

X.

Seller has not received any written notice of default under or notice of
termination of, or in the case of an Underlying Mortgaged Property located in
England and Wales, a forfeiture notice in respect of such ground lease. To
Seller’s Knowledge, there is no default under such ground lease and no condition
that, but for the passage of time or giving of notice, would result in a default
under the terms of such ground lease that, in the case of an Underlying
Mortgaged Property located in England and Wales, may reasonably be expected to
lead to forfeiture of the ground lease and such ground lease is in full force
and effect; and

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

XI.

such Ground Lease does not impose any restrictions on subletting that would be
viewed as commercially unreasonable by Seller; such Ground Lease contains a
covenant (or applicable laws provide) that the lessor thereunder is not
permitted, in the absence of an uncured default, to disturb the possession,
interest or quiet enjoyment of, or in the case of an Underlying Mortgaged
Property located in England and Wales, quiet enjoyment of, any lessee in the
relevant portion of such Underlying Mortgaged Property subject to such Ground
Lease for any reason, or in any manner, which would materially adversely affect
the security provided by the related Mortgage.

(ff) An Environmental Site Assessment (an “ESA”) meeting ASTM requirements (or
the United Kingdom equivalent) conducted by a reputable environmental consultant
relating to each Underlying Mortgaged Property and prepared no earlier than 12
months prior to the Purchase Date was obtained and reviewed by Seller in
connection with the origination of such Purchased Asset and a copy is included
in the Purchased Asset File.

(gg) There are no adverse circumstances or conditions with respect to or
affecting the Underlying Mortgaged Property that would constitute or result in a
material violation of any applicable federal, state or local environmental laws,
rules and regulations (collectively, “Environmental Laws”) and such ESA (i) did
not reveal any known circumstance or condition that rendered the Underlying
Mortgaged Property at the date of the ESA in material noncompliance with
applicable Environmental Laws or the existence of recognized environmental
conditions (as such term is defined in ASTM E1527-05 or its successor, or the
United Kingdom equivalent, hereinafter “Environmental Condition”) or the need
for further investigation, or (ii) if any material noncompliance with
Environmental Laws or the existence of an Environmental Condition or need for
further investigation was indicated in any such ESA, other than with respect to
an Underlying Mortgaged Property (A) for which environmental insurance is
maintained, or (B) that would require (x) any expenditure less than or equal to
5% of the outstanding principal balance of the mortgage loan to achieve or
maintain compliance in all material respects with any Environmental Laws or
(y) any expenditure greater than 5% of the outstanding principal balance of such
Purchased Asset to achieve or maintain compliance in all material respects with
any Environmental Laws for which, in connection with this clause (y), adequate
sums, but in no event less than 125% of the estimated cost as set forth in the
Environmental Site Assessment, were reserved in connection with the origination
of the Purchased Asset and for which the related Mortgagor has covenanted to
perform, or (iii) as to which the related Mortgagor or one of its affiliates is
currently taking or required to take such actions, if any, with respect to such
conditions or circumstances as have been recommended by the Environmental Site
Assessment or required by the applicable Governmental Authority, or (iv) as to
which another responsible party not related to the Mortgagor with assets
reasonably estimated by Seller at the time of origination to be sufficient to
effect all necessary or required remediation identified in a notice or other
action from the applicable Governmental Authority is currently taking or
required to take such actions, if any, with respect to such regulatory
authority’s order or directive, or (v) as to which the conditions or
circumstances identified in the Environmental Site Assessment were investigated
further and based upon such additional investigation, an environmental
consultant recommended no further investigation or remediation, or (vi) as to
which a party with financial resources reasonably estimated to be adequate to
cure

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

the condition or circumstance that would give rise to such material violation
provided a guarantee or indemnity to the related Mortgagor or to the mortgagee
to cover the costs of any required investigation, testing, monitoring or
remediation, or (vii) as to which the related Mortgagor or other responsible
party obtained a “No Further Action” letter or other evidence reasonably
acceptable to a prudent commercial mortgage lender that applicable federal,
state, or local Governmental Authorities had no current intention of taking any
action, and are not requiring any action, in respect of such condition or
circumstance, or (viii) that would not require substantial cleanup, remedial
action or other extraordinary response under any Environmental Laws reasonably
estimated to cost in excess of 5% of the outstanding principal balance of such
Purchased Asset;

(hh) Such Senior Mortgage Loan is the subject of an environmental insurance
policy, issued by the issuer set forth on Schedule I (the “Policy Issuer”) and
effective as of the date thereof (the “Environmental Insurance Policy”),
(ii) the Environmental Insurance Policy is in full force and effect, there is no
deductible and the trustee is a named insured under such policy, (iii)(a) a
property condition or engineering report was prepared, if the Underlying
Mortgaged Property was constructed prior to 1985, with respect to
asbestos-containing materials (“ACM”) and, if the Underlying Mortgaged Property
is a multifamily property, with respect to radon gas (“RG”) and lead-based paint
(“LBP”), and (b) if such report disclosed the existence of a material and
adverse LBP, ACM or RG environmental condition or circumstance affecting the
Underlying Mortgaged Property, the related Mortgagor (A) was required to
remediate the identified condition prior to closing the Senior Mortgage Loan or
provide additional security or establish with the mortgagee a reserve in an
amount deemed to be sufficient by the Mortgage Loan Seller, for the remediation
of the problem, and/or (B) agreed in the Purchased Asset Documents to establish
an operations and maintenance plan after the closing of the Senior Mortgage Loan
that should reasonably be expected to mitigate the environmental risk related to
the identified LBP, ACM or RG condition, (iv) on the effective date of the
Environmental Insurance Policy, the Mortgage Loan Seller as originator had no
knowledge of any material and adverse environmental condition or circumstance
affecting the Underlying Mortgaged Property (other than the existence of LBP,
ACM or RG) that was not disclosed to the Policy Issuer in one or more of the
following: (a) the application for insurance, (b) a Mortgagor questionnaire that
was provided to the Policy Issuer, or (c) an engineering or other report
provided to the Policy Issuer, and (v) the premium of any Environmental
Insurance Policy has been paid through the maturity of the policy’s term and the
term of such policy extends at least five years beyond the maturity of the
Senior Mortgage Loan.

(ii) Except for any hazardous materials being handled in accordance with
applicable Environmental Laws, (A) there exists either (i) environmental
insurance with respect to such Underlying Mortgaged Property or (ii) an amount
in an escrow account pledged as security for such Purchased Asset under the
relevant Purchased Asset Documents equal to no less than 125% of the amount
estimated in such Environmental Site Assessment as sufficient to pay the cost of
such remediation or other action in accordance with such Environmental Site
Assessment or (B) one of the statements set forth in clause (A)(ii) above is
true, (i) such Underlying Mortgaged Property is not being used for the treatment
or disposal of hazardous materials; (ii) no hazardous materials are being used
or stored or generated for off-site disposal or otherwise present at such
Underlying Mortgaged Property other than hazardous materials of such types and
in such quantities as are customarily used or stored or generated for off-site
disposal or otherwise present

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

in or at properties of the relevant property type; and (iii) such Underlying
Mortgaged Property is not subject to any environmental hazard (including,
without limitation, any situation involving hazardous materials) that under the
Environmental Laws would have to be eliminated before the sale of, or that could
otherwise reasonably be expected to adversely affect in more than a de minimis
manner the value or marketability of, such Underlying Mortgaged Property.

(jj) The related Mortgage or other Purchased Asset Documents contain covenants
on the part of the related Mortgagor requiring its compliance with any present
or future federal, state and local Environmental Laws and regulations in
connection with the Underlying Mortgaged Property. The related Mortgagor (or an
affiliate thereof) has agreed to indemnify, defend and hold Seller, and its
successors and assigns (or in the case of a participation interest, the lender
of record), harmless from and against any and all losses, liabilities, damages,
penalties, fines, expenses and claims of whatever kind or nature (including
attorneys’ fees and costs) imposed upon or incurred by or asserted against any
such party resulting from a breach of the environmental representations,
warranties or covenants given by the related Mortgagor in connection with such
Purchased Asset.

(kk) For each of the Purchased Assets that is covered by environmental
insurance, each environmental insurance policy is in an amount equal to 125% of
the outstanding principal balance of the related Purchased Asset and has a term
ending no sooner than the date that is five years after the maturity date (or,
in the case of an ARD Loan, the final maturity date) of the related Purchased
Asset. All environmental assessments or updates that were in the possession of
Seller and that relate to an Underlying Mortgaged Property as being insured by
an environmental insurance policy have been delivered to or disclosed to the
environmental insurance carrier issuing such policy prior to the issuance of
such policy.

(ll) As of the date of origination of the related Purchased Asset, and, as of
the Purchase Date, the Underlying Mortgaged Property is covered by insurance
policies providing the coverage described below and the Purchased Asset
Documents permit the mortgagee to require the coverage described below. All
premiums with respect to the insurance policies insuring each Underlying
Mortgaged Property have been paid in a timely manner or escrowed to the extent
required by the Purchased Asset Documents, and Seller has not received any
notice of cancellation or termination. The relevant Purchased Asset File
contains the insurance policy required for such Purchased Asset or a certificate
of insurance for such insurance policy. Each Mortgage requires that the
Underlying Mortgaged Property and all improvements thereon be covered by
insurance policies providing (a) coverage in the amount of the lesser of full
replacement cost of such Underlying Mortgaged Property and the outstanding
principal balance of the related Purchased Asset (subject to customary
deductibles) for fire and extended perils included within the classification
“All Risk of Physical Loss” in an amount sufficient to prevent the Mortgagor
from being deemed a co-insurer and to provide coverage on a full replacement
cost basis of such Underlying Mortgaged Property (in some cases exclusive of
foundations and footings) with an agreed amount endorsement to avoid application
of any coinsurance provision; such policies contain a standard mortgagee clause
naming mortgagee and its successor in interest as additional insureds or loss
payee, as applicable; (b) business interruption or rental loss insurance in an
amount at least equal to (i) 12 months of operations or (ii) in some cases all
rents and other amounts customarily insured under this type of insurance of the
Underlying Mortgaged Property; (c) flood insurance (if any portion of the
improvements on the Underlying Mortgaged

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

Property is located in an area identified by the Federal Emergency Management
Agency (“FEMA”) or other applicable body with respect to a Foreign Purchased
Asset, with respect to certain Purchased Assets and the Secretary of Housing and
Urban Development (or its equivalent, with respect to a Foreign Purchased Asset)
with respect to other mortgage loans, as having special flood hazards) in an
amount not less than amounts prescribed by FEMA; (d) workers’ compensation, if
required by law; (e) comprehensive general liability insurance in an amount
equal to not less than $1,000,000 (or its equivalent in the Applicable
Currency); all such insurance policies contain clauses providing they are not
terminable and may not be terminated without thirty (30) days prior written
notice to the mortgagee (except where applicable law requires a shorter period
or except for nonpayment of premiums, in which case not less than ten (10) days
prior written notice to the mortgagee is required). In addition, each Mortgage
permits the related mortgagee to make premium payments to prevent the
cancellation thereof and shall entitle such mortgagee to reimbursement therefor.
Any insurance proceeds in respect of a casualty, loss or taking will be applied
either to the repair or restoration of all or part of the Underlying Mortgaged
Property or the payment of the outstanding principal balance of the related
Purchased Asset together with any accrued interest thereon. The Underlying
Mortgaged Property is insured by an insurance policy, issued by an insurer
meeting the requirements of such Purchased Asset (or in the case of a
participation interest, of the Underlying Mortgage Loan) and having a
claims-paying or financial strength rating of at least A:X from A.M. Best
Company or “A” (or the equivalent) from S&P, Fitch or Moody’s. With respect to
each U.S. Purchased Asset, 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 probable maximum loss (“PML”)
for the Underlying Mortgaged Property in the event of an earthquake. In such
instance, the PML was based on a return period of not less than 100 years, an
exposure period of 50 years and a 10% probability of exceedence. If the
resulting report concluded that the PML would exceed 20% of the amount of the
replacement costs of the improvements, earthquake insurance on such Underlying
Mortgaged Property was obtained by an insurer rated at least A:X by A.M. Best
Company or “A” (or the equivalent) from S&P, Fitch or Moody’s. The insurer
issuing each of the foregoing insurance policies is qualified to write insurance
in the jurisdiction where the Underlying Mortgaged Property is located.

(mm) All amounts required to be deposited by each Mortgagor at origination under
the related Purchased Asset Documents have been deposited at origination and
there are no deficiencies with regard thereto.

(nn) Whether or not a Purchased Asset was originated by Seller, with respect to
each Purchased Asset originated by Seller and each Purchased Asset originated by
any Person other than Seller, as of the date of origination of the related
Purchased Asset, and, with respect to each Purchased Asset originated by Seller
and any subsequent holder of the Purchased Asset, as of the Purchase Date, there
are no actions, suits, arbitrations or governmental investigations or
proceedings by or before any court or other Governmental Authority or agency now
pending against or affecting the Mortgagor or guarantor under any Purchased
Asset or any of the Mortgaged Properties that, if determined against such
Mortgagor or such Underlying Mortgaged Property, would materially and adversely
affect the value of such Underlying Mortgaged Property, the security intended to
be provided with respect to the related Purchased Asset, the ability of such
Mortgagor and/or the current use or operation of such Underlying Mortgaged

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

Property to generate net cash flow to pay principal, interest and other amounts
due under the related Purchased Asset, title to the Underlying Mortgaged
Property, the validity or enforceability of the Mortgage, such guarantor’s
ability to perform under the related guaranty, ; and there are no such actions,
suits or proceedings threatened against such Mortgagor.

(oo) Each Purchased Asset complied at origination, in all material respects,
with all of the terms, conditions and requirements of Seller’s underwriting
standards applicable to such Purchased Asset and since origination, the
Purchased Asset has been serviced in all material respects in a legal manner in
conformance with Seller’s servicing standards.

(pp) The originator of the Purchased Asset or Seller has inspected or caused to
be inspected each Underlying Mortgaged Property within the 12 months prior to
the Purchase Date.

(qq) The Purchased Asset Documents require the Mortgagor to provide the holder
of the Purchased Asset with quarterly and annual operating statements, financial
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 (i) with
respect to each Senior Mortgage 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 and (ii) for each Senior
Mortgage Loan with an original principal balance greater than $50,000,000 (or
its equivalent in the Applicable Currency) shall be audited by an independent
certified public accountant upon the request of the owner or holder of the
Mortgage.

(rr) All escrow deposits and payments required by the terms of each Purchased
Asset are in the possession, or under the control of Seller (or in the case of a
participation interest, the servicer of the related mortgage loan), and all
amounts required to be deposited by the applicable Mortgagor under the related
Purchased Asset Documents have been deposited, and there are no deficiencies
with regard thereto (subject to any applicable notice and cure period). All of
Seller’s interest in such escrows and deposits will be conveyed by Seller to
Buyer hereunder.

(ss) Each Mortgagor with respect to a Purchased Asset is an entity whose
organizational documents or related Purchased Asset Documents provide that it
is, and at least so long as the Purchased Asset is outstanding will continue to
be, a Single Purpose Entity. Both the Purchased Asset Documents and the
organizational documents of the Mortgagor with respect to each Senior Mortgage
Loan with a principal balance as of the Purchase Date in excess of $5,000,000
(or its equivalent in the Applicable Currency) provide that the Mortgagor is a
Single Purpose Entity, and each Senior Mortgage Loan that is a U.S. Purchased
Asset with a principal balance as of the Purchase Date of $20,000,000 or more
has a counsel’s opinion regarding non-consolidation of the Mortgagor. For this
purpose, “Single Purpose Entity” shall mean a Person, other than an individual,
whose organizational documents provide that it shall engage solely in the
business of owning and operating the Underlying Mortgaged Property and that does
not engage in any business unrelated to such property and the financing thereof,
does not have any assets other than those related to its interest in the
Underlying Mortgaged Property or the financing thereof or any indebtedness other
than as permitted by the related Mortgage or other

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

Purchased Asset Documents, and the organizational documents of which require
that it have its own separate books and records and its own accounts, in each
case that are separate and apart from the books and records and accounts of any
other Person, except as permitted by the related Mortgage or other Purchased
Asset Documents, and that it holds itself out as a legal entity, separate and
apart from any other person or entity.

(tt) Each of the U.S. Purchased Assets contain a “due on sale” clause, which
provides for the acceleration of the payment of the unpaid principal balance of
the Purchased Asset (or in the case of a participation interest, of the related
mortgage loan) if, without the prior written consent of the holder of the
Purchased Asset (or in the case of an A-note or a participation interest, of the
holder of title to the Underlying Mortgage Loan), the property subject to the
Mortgage, or any controlling interest therein, is directly or indirectly
transferred or sold (except that it may provide for transfers by devise, descent
or operation of law upon the death of a member, manager, general partner or
shareholder of a Mortgagor and that it may provide for assignments subject to
the Purchased Asset holder’s approval of transferee, transfers to affiliates,
transfers to family members for estate planning purposes, transfers among
existing members, partners or shareholders in Mortgagors or transfers of passive
interests so long as the key principals or general partner retains control). The
Purchased Asset Documents for each U.S. Purchased Asset contain a “due on
encumbrance” clause, which provides for the acceleration of the payment of the
unpaid principal balance of the Purchased Asset if the property subject to the
Mortgage or any controlling interest in the Mortgagor is further pledged or
encumbered, unless the prior written consent of the holder of the Purchased
Asset is obtained (except that it may provide for assignments subject to the
Purchased Asset holder’s approval of transferee, transfers to affiliates or
transfers of passive interests so long as the key principals or general partner
retains control). The Mortgage requires the Mortgagor to pay, to the extent any
Rating Agency fees are incurred in connection with the review of and consent to
any transfer or encumbrance, such fees, along with all other reasonable fees and
expenses incurred by the Mortgagee relative to such transfer or encumbrance all
reasonable fees and expenses associated with securing the consent or approval of
the holder of the Mortgage for a waiver of a “due on sale” or “due on
encumbrance” clause or a defeasance provision. As of the Purchase Date, Seller
holds no preferred equity interest in any Mortgagor and Seller holds no
mezzanine debt related to such Underlying Mortgaged Property.

(uu) Each U.S. Purchased Asset containing provisions for defeasance of mortgage
collateral requires either (a) the prior written consent of, and compliance with
the conditions set by, the holder of the Purchased Asset to any defeasance, or
(b)(i) the replacement collateral consist of U.S. “government securities,”
within the meaning of Treasury Regulations Article 1.860 G-2(a)(8)(i), in an
amount sufficient to make all scheduled payments under the Mortgage Note when
due (up to the maturity date for the related Purchased Asset, the Anticipated
Repayment Date for ARD Loans or the date on which the Mortgagor may prepay the
related Purchased Asset without payment of any prepayment penalty); (ii) the
loan may be assumed by a Single Purpose Entity approved by the holder of the
Purchased Asset; (iii) counsel provide an opinion that the trustee has a
perfected security interest in such collateral prior to any other claim or
interest; and (iv) such other documents and certifications as the mortgagee may
reasonably require, which may include, without limitation, (A) a certification
that the purpose of the defeasance is to facilitate the disposition of the
mortgaged real property or any other customary commercial transaction and not to
be part of an arrangement to collateralize a REMIC

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

offering with obligations that are not real estate mortgages and (B) a
certification from an independent certified public accountant that the
collateral is sufficient to make all scheduled payments under the Mortgage Note
when due. Each Purchased Asset containing provisions for defeasance provides
that, in addition to any cost associated with defeasance, the related Mortgagor
shall pay, as of the date the mortgage collateral is defeased, all scheduled and
accrued interest and principal due as well as an amount sufficient to defease in
full the Purchased Asset. In addition, if the related Purchased Asset permits
defeasance, then the Purchased Asset Documents provide that the related
Mortgagor shall (x) pay all reasonable fees associated with the defeasance of
the Purchased Asset and all other reasonable expenses associated with the
defeasance, or (y) provide all opinions required under the related Purchased
Asset Documents, including a REMIC opinion, and any applicable rating agency
letters confirming that no downgrade or qualification shall occur as a result of
the defeasance. If the Senior Mortgage 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 115% of the allocated
loan amount for the real property to be released and the defeasance collateral
is not permitted to be subject to prepayment, call, or early redemption. If the
Mortgagor would continue to own assets in addition to the defeasance collateral,
the portion of the Senior Mortgage Loan secured by defeasance collateral is
required to be assumed by a Single Purpose Entity and the Mortgagor is required
to deliver an opinion of counsel that Buyer has a perfected security interest in
such collateral prior to any other claim or interest.

(vv) In the event that a Purchased Asset is secured by more than one Underlying
Mortgaged Property, then, in connection with a release of less than all of such
Mortgaged Properties, an Underlying Mortgaged Property may not be released as
collateral for the related Purchased Asset unless, in connection with such
release, an amount equal to not less than 125% of the Allocated Loan Amount for
such Underlying Mortgaged Property is prepaid or, in the case of a defeasance,
an amount equal to 125% of the Allocated Loan Amount is defeased through the
deposit of replacement collateral (as contemplated in clause (34) hereof)
sufficient to make all scheduled payments with respect to such defeased amount,
or such release is otherwise in accordance with the terms of the Purchased Asset
Documents. With respect to any partial release, either: (x) such release of
collateral (i) would not constitute a “significant modification” of the Senior
Mortgage Loan within the meaning of Treasury Regulations Section 1.860G-2(b)(2)
and (ii) would not cause the subject Senior Mortgage 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
Asset 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), for any Senior
Mortgage Loan originated after December 6, 2010, if the fair market value of the
real property constituting such Underlying Mortgaged Property after the release
is not equal to at least 80% of the principal balance of the Senior Mortgage
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 of the Code.

In the case of any Senior Mortgage Loan originated after December 6, 2010, in
the event of a taking of any portion of an Underlying Mortgaged Property by a
State or any political subdivision or authority thereof, whether by legal
proceeding or by agreement, the Mortgagor

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

can be required to pay down the principal balance of the Senior Mortgage Loan in
an amount not less than the amount required by the REMIC provisions of the Code
and, to such extent, the award for any such taking may not be required to be
applied to the restoration of the Underlying Mortgaged Property or released to
the Mortgagor, if, immediately after the release of such portion of the
Underlying Mortgaged Property from the lien of the Mortgage (but taking into
account the planned restoration) the fair market value of the real property
constituting the remaining Underlying Mortgaged Property is not equal to at
least 80% of the remaining principal balance of the Senior Mortgage Loan.

In the case of any Senior Mortgage Loan originated after December 6, 2010, no
such Senior Mortgage Loan that is secured by more than one Underlying Mortgaged
Property or that is cross-collateralized with another Senior Mortgage Loan
permits the release of cross-collateralization of the related Mortgaged
Properties or a portion thereof, including due to a partial condemnation, other
than in compliance with the loan-to-value ratio and other requirements of the
REMIC provisions of the Code.

(ww) Each Underlying Mortgaged Property is owned in fee by the related
Mortgagor, with the exception of (i) Mortgaged Properties that are secured in
whole or in a part by a Ground Lease and (ii) out-parcels, and is used and
occupied for commercial or multifamily residential purposes in accordance with
applicable law. In respect of each Underlying Mortgaged Property located in
England and Wales, which is (A) not registered, the Mortgagor has good and
marketable title to the fee simple absolute in possession or a term of years
absolute; or (B) registered, the Mortgagor has title absolute in the case of
freehold property or absolute or good leasehold title in the case of leasehold
property.

(xx) Any material non-conformity with applicable zoning laws constitutes a legal
non-conforming use or structure that, in the event of casualty or destruction,
may be restored or repaired to the full extent of the use or structure at the
time of such casualty, or for which law and ordinance insurance coverage has
been obtained in amounts consistent with the standards utilized by Seller.

(yy) Neither Seller nor any affiliate thereof has any obligation to make any
capital contributions to the related Mortgagor under the Purchased Asset. The
Purchased Asset was not originated for the sole purpose of financing the
construction of incomplete improvements on the Underlying Mortgaged Property.

(zz) The following statements are true with respect to the Underlying Mortgaged
Property: (a) the Underlying Mortgaged Property is located on or adjacent to a
dedicated road or has access to an irrevocable easement permitting ingress and
egress and (b) the Underlying Mortgaged Property is served by public or private
utilities, water and sewer (or septic facilities) and otherwise appropriate for
the use in which the Underlying Mortgaged Property is currently being utilized.

(aaa) None of the Purchased Asset Documents contain any provision that expressly
excuses the related borrower from obtaining and maintaining insurance coverage
for acts of terrorism and, in circumstances where terrorism insurance is not
expressly required, the mortgagee is not prohibited from requesting that the
related borrower maintain such insurance, in

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

each case, to the extent such insurance coverage is generally available for like
properties in such jurisdictions at commercially reasonable rates. Each
Underlying Mortgaged Property is insured by an “all-risk” casualty insurance
policy and such policy did not, as of the date of origination of the Senior
Mortgage Loan, and, to Seller’s Knowledge, do not contain an express exclusion
for (or, alternatively, is covered by a separate policy that insures against
property damage resulting from) acts of terrorism.

(bbb) An appraisal of the Underlying Mortgaged Property was conducted in
connection with the origination of such Purchased Asset (or in the case of a
participation interest, the date of origination of the Underlying Mortgage
Loan), and such appraisal satisfied the guidelines in Title XI of the Financial
Institutions Reform, Recovery and Enforcement Act of 1989 (or its United Kingdom
equivalent), in either case as in effect on the date such Purchased Asset (or in
the case of a participation interest, the Underlying Mortgage Loan) was
originated. The appraisal date is within 6 months of the Senior Mortgage Loan
origination date, and within 12 months of the Purchase Date. The appraisal is
signed by an appraiser who is a Member of the Appraisal Institute (“MAI”) or, in
the case of an Underlying Mortgaged Property located in England and Wales, a
Charter Surveyor and, to Seller’s Knowledge, had no interest, direct or
indirect, in the Underlying 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 Senior Mortgage Loan. Each appraiser has
represented in such appraisal or in a supplemental letter that the appraisal
satisfies the requirements of the “Uniform Standards of Professional Appraisal
Practice” as adopted by the Appraisal Standards Board of the Appraisal
Foundation or, in the case of an Underlying Mortgaged Property located in
England and Wales, the Valuations Standards (Red Book) published by the Royal
Institute of Chartered Surveyors.

(ccc) With respect to a U.S. Purchased Asset, Senior Mortgage Loan is a
“qualified mortgage” within the meaning of Section 860G(a)(3) of the Code (but
determined without regard to the rule in 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 Senior Mortgage Loan to
the related Mortgagor at origination did not exceed the non-contingent principal
amount of the Senior Mortgage Loan and (B) either: (a) such Senior Mortgage 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 Senior Mortgage Loan was originated at least equal to 80% of
the adjusted issue price of the Senior Mortgage Loan on such date or (ii) at the
Closing Date at least equal to 80% of the adjusted issue price of the Senior
Mortgage 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 Senior Mortgage
Loan and (B) a proportionate amount of any lien that is in parity with the
Senior Mortgage Loan; or (b) substantially all of the proceeds of such Senior
Mortgage Loan were used to acquire, improve or protect the real property which
served as the only security for such Senior Mortgage 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 the Senior Mortgage Loan was
“significantly modified” prior to the Closing 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 Senior Mortgage 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 Senior Mortgage Loan was
originated) or sub-clause (B)(a)(ii), including the

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

proviso thereto. Any prepayment premium and yield maintenance charges applicable
to the Senior Mortgage Loan constitute “customary prepayment penalties” within
the meaning of Treasury Regulations Section 1.860G-(b)(2). All terms used in
this paragraph shall have the same meanings as set forth in the related Treasury
Regulations.

(ddd) Seller has obtained a rent roll other than with respect to hospitality
properties certified by the related Mortgagor or the related guarantor(s) as
accurate and complete in all material respects as of a date within 180 days of
the date of origination of the related Senior Mortgage Loan. Seller has obtained
operating histories with respect to each Underlying Mortgaged Property certified
by the related Mortgagor or the related guarantor(s) as accurate and complete in
all material respects as of a date within 180 days of the date of origination of
the related Senior Mortgage Loan. The operating histories collectively report on
operations for a period equal to (a) at least a continuous three-year period or
(b) in the event the Underlying Mortgaged Property was owned, operated or
constructed by the Mortgagor or an affiliate for less than three years then for
such shorter period of time, it being understood that for Mortgaged Properties
acquired with the proceeds of a Senior Mortgage Loan, operating histories may
not have been available.

(eee) Seller has obtained an organizational chart or other description of each
Mortgagor which identifies all beneficial controlling owners of the Mortgagor
(i.e., managing members, general partners or similar controlling person for such
Mortgagor) (the “Controlling Owner”) and all owners that hold a 20% or greater
direct ownership share (i.e., the “Major Sponsors”). Seller (1) required
questionnaires to be completed by each Controlling Owner and guarantor or
performed other processes designed to elicit information from each Controlling
Owner and guarantor regarding such Controlling Owner’s or guarantor’s prior
history for at least 10 years regarding any bankruptcies or other insolvencies,
any felony convictions, and (2) performed or caused to be performed searches of
the public records or services such as Lexis/Nexis, or a similar service
designed to elicit information about each Controlling Owner, Major Sponsor and
guarantor regarding such Controlling Owner’s, Major Sponsor’s or guarantor’s
prior history for at least 10 years regarding any bankruptcies or other
insolvencies, any felony convictions, and provided, however, that records
searches were limited to the last 10 years. ((1) and (2) collectively, the
“Sponsor Diligence”). Based solely on the Sponsor Diligence, to the Knowledge of
Seller, no Major Sponsor or guarantor (i) was in a state of federal bankruptcy
or insolvency proceeding, (ii) had a prior record of having been in a state of
federal bankruptcy or insolvency, or (iii) had been convicted of a felony.

(fff) With respect to each Senior Mortgage Loan that is a U.S. Purchased Asset
that is predominantly secured by a retail, office or industrial property leased
to a single tenant, the Mortgage Loan Seller reviewed such estoppel obtained
from such tenant no earlier than 90 days prior to the origination date of the
related Senior Mortgage Loan, and to the Mortgage Loan Seller’s knowledge based
solely on the related estoppel certificate, the related lease is in full force
and effect or if not in full force and effect the related space was underwritten
as vacant, subject to customary reservations of tenant’s rights, such as,
without limitation, with respect to common area maintenance and pass-through
audits and verification of landlord’s compliance with co-tenancy provisions.
With respect to each Mortgage Loan predominantly secured by a retail, office or
industrial property, the Mortgage Loan Seller has received lease estoppels
executed within 90 days of the origination date of the related Senior Mortgage
Loan that

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

collectively account for at least 65% of the in-place base rent for the
Underlying Mortgaged Property or set of cross-collateralized properties that
secure a Senior Mortgage Loan that is represented on the certified rent roll. To
the Mortgage Loan Seller’s knowledge, each lease represented on the certified
rent roll is in full force and effect, subject to customary reservations of
tenant’s rights, such as with respect to common area maintenance and
pass-through audits and verification of landlord’s compliance with co-tenancy
provisions.

(ggg) Such Senior Mortgage Loan is not cross-collateralized or cross-defaulted
with any other Asset that is not subject to a Transaction.

(hhh) No advance of funds has been made by Seller to the related Mortgagor, and
no funds have been received from any person other than the related Mortgagor or
an affiliate, directly, or, to the Knowledge of Seller, indirectly for, or on
account of, payments due on the Senior Mortgage Loan. Neither Seller nor any
Affiliate thereof has any obligation to make any capital contribution to any
Mortgagor under the Senior Mortgage Loan, other than contributions made on or
prior to the Purchase Date.

(iii) Seller has complied with its internal procedures with respect to all
applicable anti-money laundering laws and regulations, including without
limitation the USA Patriot Act of 2001 in connection with the origination of the
Senior Mortgage Loan.

Defined Terms

As used in this Exhibit:

The term “Allocated Loan Amount” shall mean, for each Underlying Mortgaged
Property, the portion of principal of the related Purchased Asset allocated to
such Mortgaged Property for certain purposes (including determining the release
prices of properties, if permitted) under such Purchased Asset as set forth in
the related loan documents. There can be no assurance, and it is unlikely, that
the Allocated Loan Amounts represent the current values of individual Mortgaged
Properties, the price at which an individual Underlying Mortgaged Property could
be sold in the future to a willing buyer or the replacement cost of the
Mortgaged Properties.

The term “Anticipated Repayment Date” shall mean, with respect to any Purchased
Asset that is indicated on the Purchased Asset Schedule as having a Revised
Rate, the date upon which such Purchased Asset commences accruing interest at
such Revised Rate.

The term “Assignment of Leases” shall have the meaning specified in paragraph 10
of this Exhibit VI.

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

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

The term “ARD Loan” shall mean any Purchased Asset that provides that if the
unamortized principal balance thereof is not repaid on its Anticipated Repayment
Date, such Purchased Asset will accrue Excess Interest at the rate specified in
the related Mortgage Note and the Mortgagor is required to apply excess monthly
cash flow generated by the Underlying Mortgaged Property to the repayment of the
outstanding principal balance on such Purchased Asset.

The term “Due Date” shall mean the day of the month set forth in the related
Mortgage Note on which each monthly payment of interest and/or principal thereon
is scheduled to be first due.

The term “Environmental Site Assessment” shall mean a Phase I environmental
report meeting the requirements of the American Society for Testing and
Materials, and, if in accordance with customary industry standards a reasonable
lender would require it, a Phase II environmental report, each prepared by a
licensed third party professional experienced in environmental matters.

The term “Excess Cash Flow” shall mean the cash flow from the Underlying
Mortgaged Property securing an ARD Loan after payments of interest (at the
Mortgage Interest Rate) and principal (based on the amortization schedule), and
(a) required payments for the tax and insurance fund and ground lease escrows
fund, (b) required payments for the monthly debt service escrows, if any,
(c) payments to any other required escrow funds and (d) payment of operating
expenses pursuant to the terms of an annual budget approved by the servicer and
discretionary (lender approved) capital expenditures.

The term “Excess Interest” shall mean any accrued and deferred interest on an
ARD Loan in accordance with the following terms. Commencing on the respective
Anticipated Repayment Date each ARD Loan (pursuant to its existing terms or a
unilateral option, as defined in Treasury Regulations under Article 1001 of the
Code, in the Purchased Assets exercisable during the term of the Purchased
Asset) generally will bear interest at a fixed rate (the “Revised Rate”) per
annum equal to the Mortgage Interest Rate plus a percentage specified in the
related Purchased Asset Documents. Until the principal balance of each such
Purchased Asset has been reduced to zero (pursuant to its existing terms or a
unilateral option, as defined in Treasury Regulations under Article 1001 of the
Code, in the Purchased Assets exercisable during the term of the mortgage loan),
such Purchased Asset will only be required to pay interest at the Mortgage
Interest Rate and the interest accrued at the excess of the related Revised Rate
over the related Mortgage Interest Rate will be deferred (such accrued and
deferred interest and interest thereon, if any, is “Excess Interest”).

The term “Mortgage Interest Rate” shall mean the fixed rate, or the formula
applicable to determine the floating rate, of interest per annum that each
Purchased Asset bears as of the Purchase Date.

The term “Permitted Encumbrances” shall mean:

 

  I.

the lien of current real property taxes, water charges, sewer rents and
assessments not yet delinquent or accruing interest or penalties;

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

  II.

covenants, conditions and restrictions, rights of way, easements and other
matters of public record acceptable to mortgage lending institutions generally
and referred to in the related mortgagee’s title insurance policy or, in the
case of an Underlying Mortgaged Property located in England and Wales, any title
report or certificate of title;

 

  III.

other matters to which like properties are commonly subject and which are
acceptable to mortgage lending institutions generally, and

 

  IV.

the rights of tenants, as tenants only, whether under ground leases or space
leases at the Underlying Mortgaged Property

that together do not materially and adversely affect the related Mortgagor’s
ability to timely make payments on the related Purchased Asset, which do not
materially interfere with the benefits of the security intended to be provided
by the related Mortgage or the use, for the use currently being made, the
operation as currently being operated, enjoyment, value or marketability of such
Underlying Mortgaged Property, provided, however, that, for the avoidance of
doubt, Permitted Encumbrances shall exclude all pari passu, second, junior and
subordinated mortgages but shall not exclude mortgages that secure Purchased
Assets that are cross-collateralized with other Purchased Assets.

The term “Revised Rate” shall mean, with respect to those Purchased Assets on
the Purchased Asset Schedule indicated as having a revised rate, the increased
interest rate after the Anticipated Repayment Date (in the absence of a default)
for each applicable Purchased Asset, as calculated and as set forth in the
related Purchased Asset.

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

REPRESENTATIONS AND WARRANTIES

REGARDING EACH INDIVIDUAL PURCHASED ASSET

THAT IS A JUNIOR MORTGAGE LOAN

(OTHER THAN A PARTICIPATION INTEREST)

(a) The information set forth in the Purchased Asset Schedule is complete, true
and correct in all material respects.

(b) There exists no material default, breach, violation or event of acceleration
(and no event that, with the passage of time or the giving of notice, or both,
would constitute any of the foregoing) under the documents evidencing or
securing the Purchased Asset, in any such case to the extent the same materially
and adversely affects the value of the Purchased Asset and the related
underlying real property.

(c) Except with respect to the enforceability of any provisions requiring the
payment of default interest, late fees, additional interest, prepayment premiums
or yield maintenance charges, neither the Purchased Asset nor any of the related
Purchased Asset Documents is subject to any right of rescission, set-off,
abatement, diminution, valid counterclaim or defense, including the defense of
usury, nor will the operation of any of the terms of any such Purchased Asset
Documents, or the exercise (in compliance with procedures permitted under
applicable law) of any right thereunder, render any Purchased Asset Documents
subject to any right of rescission, set-off, abatement, diminution, valid
counterclaim or defense, including the defense of usury (subject to
anti-deficiency or one form of action laws and to bankruptcy, receivership,
conservatorship, reorganization, insolvency, moratorium or other similar laws
affecting the enforcement of creditor’s rights generally and by general
principles of equity (regardless of whether such enforcement is considered in a
proceeding in equity or at law)), and no such right of rescission, set-off,
abatement, diminution, valid counterclaim or defense has been asserted with
respect thereto.

(d) The Purchased Asset Documents have been duly and properly executed by the
originator of the Purchased Asset, and each is the legal, valid and binding
obligation of the parties thereto, enforceable in accordance with its terms,
except as such enforcement may be limited by bankruptcy, insolvency,
reorganization, receivership, moratorium or other laws relating to or affecting
the rights of creditors generally and by general principles of equity
(regardless of whether such enforcement is considered in a proceeding in equity
or at law). The Purchased Asset is not usurious under any Applicable Law to
which the Purchased Asset is subject.

(e) The terms of the related Purchased Asset Documents have not been impaired,
waived, altered or modified in any material respect (other than by a written
instrument that is included in the related Purchased Asset File).

(f) The assignment of the Purchased Asset constitutes the legal, valid and
binding assignment of such Purchased Asset from Seller to or for the benefit of
Buyer enforceable in accordance with its terms, except as such enforcement may
be limited by bankruptcy, insolvency, reorganization, receivership, moratorium
or other laws relating to or affecting the rights of creditors generally and by
general principles of equity (regardless of whether such enforcement is
considered in a proceeding in equity or at law).

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

(g) All representations and warranties in the Purchased Asset Documents and in
the underlying documents for the performing commercial mortgage loan secured by
a first lien on a multifamily or commercial property to which such Purchased
Asset relates are true and correct in all material respects.

(h) The servicing and collection practices used by Seller for the Purchased
Asset have complied with applicable law in all material respects and are
consistent with those employed by prudent servicers of comparable Purchased
Assets.

(i) Seller is not a debtor in any state or federal bankruptcy or insolvency
proceeding.

(j) As of the Purchase Date, there is no payment default, giving effect to any
applicable notice and/or grace period, and there is no other material default
under any of the related Purchased Asset Documents, giving effect to any
applicable notice and/or grace period; no such material default or breach has
been waived by Seller or on its behalf or, by Seller’s predecessors in interest
with respect to the Purchased Assets; and no event has occurred that, with the
passing of time or giving of notice would constitute a material default or
breach; provided, however, that the representations and warranties set forth in
this sentence do not cover any default, breach, violation or event of
acceleration that specifically pertains to or arises out of any subject matter
otherwise covered by any other representation or warranty made by Seller in this
Exhibit VI. No Purchased Asset has been accelerated and no foreclosure or power
of sale proceeding has been initiated in respect of the related Mortgage. With
respect to a U.S. Purchased Asset, Seller has not waived any material claims
against the related Mortgagor under any non-recourse exceptions contained in the
Mortgage Note.

(k) No Purchased Asset has been satisfied, canceled, subordinated (except to the
senior mortgage loan from which the Purchased Asset is derived), released or
rescinded, in whole or in part, and the related Mortgagor has not been released,
in whole or in part, from its obligations under any related Purchased Asset
Document.

(l) There are no circumstances or conditions with respect to the Purchased
Asset, the Underlying Mortgaged Property, the related Mortgage, the related
Mortgagor, the Purchased Asset File or the Mortgagor’s credit standing that can
reasonably be expected to cause private institutional investors to regard the
Purchased Asset as an unacceptable investment, cause the Purchased Asset to
become delinquent or adversely affect the value or marketability of the
Purchased Asset.

(m) The Purchased Asset was underwritten strictly in accordance with each
Seller’s underwriting standards and conforms to the standards that would be
required by Buyer and the Rating Agencies for Buyer to effect one or more sales
or assignments of the Purchased Asset or participation interests therein or
securitizations of highly-rated single or multi-class securities secured by or
evidencing ownership interests in the Purchased Asset and the related Mortgage.

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

(n) Seller has complied with its internal procedures with respect to all
applicable anti-money laundering laws and regulations, including without
limitation the USA Patriot Act of 2001 in connection with the origination of the
Senior Mortgage Loan.

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

REPRESENTATIONS AND WARRANTIES

REGARDING EACH INDIVIDUAL PURCHASED ASSET

THAT IS A PARTICIPATION INTEREST

IN A SENIOR MORTGAGE LOAN

OR JUNIOR MORTGAGE LOAN

(a) The representations and warranties set forth in this Exhibit VI regarding
the Senior Mortgage Loan or Junior Mortgage Loan from which the Purchased Asset
is derived shall be deemed incorporated herein in respect of such senior
mortgage loan, provided, however, that, in the event that such senior mortgage
loan was not originated by Seller or an Affiliate of Seller, Seller shall be
deemed to be making the representations set forth in this Exhibit VI with
respect to such senior mortgage loan to Seller’s Knowledge.

(b) The information set forth in the Purchased Asset Schedule is complete, true
and correct in all material respects.

(c) There exists no material default, breach, violation or event of acceleration
(and no event that, with the passage of time or the giving of notice, or both,
would constitute any of the foregoing) under the documents evidencing or
securing the Purchased Asset, in any such case to the extent the same materially
and adversely affects the value of the Purchased Asset and the related
underlying real property.

(d) Except with respect to the enforceability of any provisions requiring the
payment of default interest, late fees, additional interest, prepayment premiums
or yield maintenance charges, neither the Purchased Asset nor any of the related
Purchased Asset Documents is subject to any right of rescission, set-off,
abatement, diminution, valid counterclaim or defense, including the defense of
usury, nor will the operation of any of the terms of any such Purchased Asset
Documents, or the exercise (in compliance with procedures permitted under
applicable law) of any right thereunder, render any Purchased Asset Documents
subject to any right of rescission, set-off, abatement, diminution, valid
counterclaim or defense, including the defense of usury (subject to
anti-deficiency or one form of action laws and to bankruptcy, receivership,
conservatorship, reorganization, insolvency, moratorium or other similar laws
affecting the enforcement of creditor’s rights generally and by general
principles of equity (regardless of whether such enforcement is considered in a
proceeding in equity or at law)), and no such right of rescission, set-off,
abatement, diminution, valid counterclaim or defense has been asserted with
respect thereto.

(e) The Purchased Asset Documents have been duly and properly executed by the
originator of the Purchased Asset, and each is the legal, valid and binding
obligation of the parties thereto, enforceable in accordance with its terms,
except as such enforcement may be limited by bankruptcy, insolvency,
reorganization, receivership, moratorium or other laws relating to or affecting
the rights of creditors generally and by general principles of equity
(regardless of whether such enforcement is considered in a proceeding in equity
or at law). The Purchased Asset is not usurious under any Applicable Law to
which the Purchased Asset is subject.

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

(f) The terms of the related Purchased Asset Documents have not been impaired,
waived, altered or modified in any material respect (other than by a written
instrument that is included in the related Purchased Asset File).

(g) The assignment of the Purchased Asset constitutes the legal, valid and
binding assignment of such Purchased Asset from Seller to or for the benefit of
Buyer enforceable in accordance with its terms, except as such enforcement may
be limited by bankruptcy, insolvency, reorganization, receivership, moratorium
or other laws relating to or affecting the rights of creditors generally and by
general principles of equity (regardless of whether such enforcement is
considered in a proceeding in equity or at law).

(h) All representations and warranties in the Purchased Asset Documents and in
the underlying documents for the performing commercial mortgage loan secured by
a first lien on a multifamily or commercial property to which such Purchased
Asset relates are true and correct in all material respects.

(i) The servicing and collection practices used by Seller for the Purchased
Asset have complied with applicable law in all material respects and are
consistent with those employed by prudent servicers of comparable Purchased
Assets.

(j) Seller is not a debtor in any state or federal bankruptcy or insolvency
proceeding.

(k) As of the Purchase Date, there is no payment default, giving effect to any
applicable notice and/or grace period, and there is no other material default
under any of the related Purchased Asset Documents, giving effect to any
applicable notice and/or grace period; no such material default or breach has
been waived by Seller or on its behalf or by Seller’s predecessors in interest
with respect to the Purchased Assets; and no event has occurred that, with the
passing of time or giving of notice would constitute a material default or
breach; provided, however, that the representations and warranties set forth in
this sentence do not cover any default, breach, violation or event of
acceleration that specifically pertains to or arises out of any subject matter
otherwise covered by any other representation or warranty made by Seller in this
Exhibit VI. No Purchased Asset has been accelerated and no foreclosure or power
of sale proceeding has been initiated in respect of the related Mortgage. With
respect to a U.S. Purchased Asset, Seller has not waived any material claims
against the related Mortgagor under any non-recourse exceptions contained in the
Mortgage Note.

(l) No Purchased Asset has been satisfied, canceled, subordinated (except to the
senior mortgage loan from which the Purchased Asset is derived), released or
rescinded, in whole or in part, and the related Mortgagor has not been released,
in whole or in part, from its obligations under any related Purchased Asset
Document.

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

REPRESENTATIONS AND WARRANTIES

REGARDING PURCHASED ASSETS CONSISTING

OF MEZZANINE LOANS

(a) The Mezzanine Loan is a performing mezzanine loan secured by a pledge of all
of the Capital Stock of a Mortgagor that owns income producing commercial real
estate.

(b) As of the Purchase Date, such Mezzanine Loan complies in all material
respects with, or is exempt from, all requirements of federal, state or local
law relating to such Mezzanine Loan.

(c) Immediately prior to the sale, transfer and assignment to Buyer thereof,
Seller had good and marketable title to, and was the sole owner and holder of,
such Mezzanine Loan, and Seller is transferring such Mezzanine Loan free and
clear of any and all liens, pledges, encumbrances, charges, security interests
or any other ownership interests of any nature encumbering such Mezzanine Loan.
Upon consummation of the purchase contemplated to occur in respect of such
Mezzanine Loan on the Purchase Date therefor, Seller will have validly and
effectively conveyed to Buyer all legal and beneficial interest in and to such
Mezzanine Loan free and clear of any pledge, lien, encumbrance or security
interest.

(d) No fraudulent acts were committed by Seller in connection with its
acquisition or origination of such Mezzanine Loan nor were any fraudulent acts
committed by any Person in connection with the origination of such Mezzanine
Loan.

(e) All information contained in the related Due Diligence Package (or as
otherwise provided to Buyer) in respect of such Mezzanine Loan is accurate and
complete in all material respects.

(f) Except as included in the Due Diligence Package, Seller is not a party to
any document, instrument or agreement, and there is no document, that by its
terms modifies or affects the rights and obligations of any holder of such
Mezzanine Loan and Seller has not consented to any material change or waiver to
any term or provision of any such document, instrument or agreement and no such
change or waiver exists.

(g) Such Mezzanine Loan is presently outstanding, the proceeds thereof have been
fully and properly disbursed and, except for amounts held in escrow by Seller,
there is no requirement for any future advances thereunder.

(h) Seller has full right, power and authority to sell and assign such Mezzanine
Loan and such Mezzanine Loan or any related Mezzanine Note has not been
cancelled, satisfied or rescinded in whole or part nor has any instrument been
executed that would effect a cancellation, satisfaction or rescission thereof.

(i) Other than consents and approvals obtained as of the related Purchase Date
or those already granted in the documentation governing such Mezzanine Loan (the
“Mezzanine

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

Loan Documents”), no consent or approval by any Person is required in connection
with Seller’s sale and/or Buyer’s acquisition of such Mezzanine Loan, for
Buyer’s exercise of any rights or remedies in respect of such Mezzanine Loan or
for Buyer’s sale, pledge or other disposition of such Mezzanine 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.

(j) The Mezzanine Collateral is secured by a pledge of equity ownership
interests in the related borrower under the Underlying Mortgage Loan or a direct
or indirect owner of the related borrower and the security interest created
thereby has been fully perfected in favor of Seller as lender under the
Mezzanine Loan.

(k) The Underlying Property Owner has been duly organized and is validly
existing and in good standing under the laws of its jurisdiction of
organization, with requisite power and authority to own its assets and to
transact the business in which it is now engaged, the sole purpose of the
Underlying Property Owner under its organizational documents is to own, finance,
sell or otherwise manage the Properties and to engage in any and all activities
related or incidental thereto, and the Mortgaged Properties constitute the sole
assets of the Underlying Property Owner.

(l) The Underlying Property Owner has good and marketable title to the
Underlying Mortgaged Property, no claims under the title policies insuring the
Underlying Property Owner’s title to the Properties have been made, and the
Underlying Property Owner has not received any written notice regarding any
material violation of any easement, restrictive covenant or similar instrument
affecting the Underlying Mortgaged Property.

(m) The representations and warranties made by the borrower (the “Mezzanine
Borrower”) in the Mezzanine Loan Documents were true and correct in all material
respects as of the date such representations and warranties were stated to be
true therein, and there has been no adverse change with respect to the Mezzanine
Loan, the Mezzanine Borrower, the Underlying Mortgaged Property or the
Underlying Property Owner that would render any such representation or warranty
not true or correct in any material respect as of the Purchase Date.

(n) The Mezzanine Loan Documents provide for the acceleration of the payment of
the unpaid principal balance of the Mezzanine Loan if (i) the related borrower
voluntarily transfers or encumbers all or any portion of any related Mezzanine
Collateral, or (ii) any direct or indirect interest in the related borrower is
voluntarily transferred or assigned, other than, in each case, as permitted
under the terms and conditions of the related loan documents.

(o) Pursuant to the terms of the Mezzanine Loan Documents: (a) no material terms
of any related Mortgage may be waived, canceled, subordinated or modified in any
material respect and no material portion of such Mortgage or the Underlying
Mortgaged Property may be released without the consent of the holder of the
Mezzanine Loan; (b) no material action may be taken by the Underlying Property
Owner with respect to the Underlying Mortgaged Property without the consent of
the holder of the Mezzanine Loan; (c) the holder of the Mezzanine Loan is
entitled to approve the budget of the Underlying Property Owner as it relates to
the Underlying Mortgaged Property; and (d) the holder of the Mezzanine Loan’s
consent is required prior to the Underlying Property Owner incurring any
additional indebtedness.

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

(p) There is no (i) monetary default, breach or violation with respect to such
Mezzanine Loan, the Underlying Mortgage Loan or any other obligation of the
owner of the Underlying Mortgaged Property (the “Underlying Property Owner”),
(ii) material non-monetary default, breach or violation with respect to such
Mezzanine Loan, the Underlying Mortgage Loan or any other obligation of the
Underlying Property Owner or (iii) event which, with the passage of time or with
notice and the expiration of any grace or cure period, would constitute a
default, breach, violation or event of acceleration.

(q) No default or event of default has occurred under any agreement pertaining
to any lien or other interest that ranks pari passu with or senior to the
interests of the holder of such Mezzanine Loan or with respect to any Underlying
Mortgage Loan or other indebtedness in respect of the related Underlying
Mortgaged Property and there is no provision in any agreement related to any
such lien, interest or loan which would provide for any increase in the
principal amount of any such lien, other interest or loan.

(r) With respect to a U.S. Purchased Asset, Seller’s security interest in the
Mezzanine Loan is covered by a UCC-9 insurance policy (the “UCC-9 Policy”) in
the maximum principal amount of the Mezzanine Loan insuring that the related
pledge is a valid first priority lien on the collateral pledged in respect of
such Mezzanine Loan (the “Mezzanine Collateral”), subject only to the exceptions
stated therein (or a pro forma title policy or marked up title insurance
commitment on which the required premium has been paid exists which evidences
that such UCC-9 Policy will be issued), such UCC-9 Policy (or, if it has yet to
be issued, the coverage to be provided thereby) is in full force and effect, no
material claims have been made thereunder and no claims have been paid
thereunder, Seller has not done, by act or omission, anything that would
materially impair the coverage under the UCC-9 Policy and as of the Purchase
Date, the UCC-9 Policy (or, if it has yet to be issued, the coverage to be
provided thereby) will inure to the benefit of Buyer without the consent of or
notice to the insurer.

(s) The Mezzanine Loan, and each party involved in the origination of the
Mezzanine Loan, complied as of the date of origination with, or was exempt from,
applicable state or federal laws, regulations and other requirements pertaining
to usury.

(t) With respect to a U.S. Purchased Asset, Seller has delivered to Buyer or its
designee the original promissory note made in respect of such Mezzanine Loan,
together with an original assignment thereof executed by Seller in blank. With
respect to a Foreign Purchased Asset, Seller has delivered to the Buyer the
original Foreign Finance Documents, the applicable Foreign Assignment
Agreements, and a Transfer Certificate.

(u) Seller has not received any written notice that the Mezzanine Loan may be
subject to reduction or disallowance for any reason, including without
limitation, any setoff, right of recoupment, defense, counterclaim or impairment
of any kind.

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

(v) Seller has no obligation to make loans to, make guarantees on behalf of, or
otherwise extend credit to, or make any of the foregoing for the benefit of, the
Mezzanine Borrower or any other person under or in connection with the Mezzanine
Loan.

(w) The servicing and collection practices used by the servicer of the Mezzanine
Loan, and the origination practices of the related originator, have been in all
respects legal, proper and prudent and have met customary industry standards by
prudent institutional commercial mezzanine lenders and mezzanine loan servicers
except to the extent that, in connection with its origination, such standards
were modified as reflected in the documentation delivered to Buyer.

(x) If applicable, the ground lessor consented to and acknowledged that (i) the
Mezzanine Loan is permitted / approved, (ii) any foreclosure of the Mezzanine
Loan and related change in ownership of the ground lessee will not require the
consent of the ground lessor or constitute a default under the ground lease,
(iii) copies of default notices would be sent to Mezzanine Lender and (iv) it
would accept cure from Mezzanine Lender on behalf of the ground lessee.

(y) To the extent Buyer was granted a security interest with respect to the
Mezzanine Loan, such interest (i) was given for due consideration, (ii) has
attached, (iii) is perfected, (iv) is a first priority Lien, and (v) has been
appropriately assigned to Buyer by the Underlying Property Owner.

(z) 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 Mezzanine Loan.

(aa) Seller has not received written notice of any outstanding liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind for which the holder of such Mezzanine
Loan is or may become obligated.

(bb) Seller has not advanced funds, or knowingly received any advance of funds
from a party other than the borrower relating to such Mezzanine Loan, directly
or indirectly, for the payment of any amount required by such Mezzanine Loan.

(cc) All real estate taxes and governmental assessments, or installments
thereof, which would be a lien on any related Underlying Mortgaged Property and
that prior to the Purchase Date for the related Purchased Asset have become
delinquent in respect of such Underlying Mortgaged Property have been paid, or
an escrow of funds in an amount sufficient to cover such payments has been
established. For purposes of this representation and warranty, real estate taxes
and governmental assessments 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.

(dd) As of the Purchase Date for the related Purchased Asset, each related
Underlying Mortgaged Property was free and clear of any material damage (other
than deferred maintenance for which escrows were established at origination)
that would affect materially and adversely the

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

value of such Underlying Mortgaged Property as security for the related
Underlying Mortgage Loan and there was no proceeding pending or, based solely
upon the delivery of written notice thereof from the appropriate condemning
authority, threatened for the total or partial condemnation of such Underlying
Mortgaged Property.

(ee) As of the Purchase Date of the Mezzanine Loan, all insurance coverage
required under the Mezzanine Loan Documents and/or any mortgage loan related to
the Underlying Mortgaged Property, which insurance covered such risks as were
customarily acceptable to prudent commercial and multifamily mortgage lending
institutions lending on the security of property comparable to the related
Underlying Mortgaged Property in the jurisdiction in which such Underlying
Mortgaged Property is located, and with respect to a fire and extended perils
insurance policy, is in an amount (subject to a customary deductible) at least
equal to the lesser of (i) the replacement cost of improvements located on such
Underlying Mortgaged Property, or (ii) the outstanding principal balance of the
Underlying Mortgage Loan, and in any event, the amount necessary to prevent
operation of any co-insurance provisions; and, except if such Underlying
Mortgaged Property is operated as a mobile home park, is also covered by
business interruption or rental loss insurance, in an amount at least equal to
12 months of operations of the related Underlying Mortgaged Property, all of
which was in full force and effect with respect to each related Underlying
Mortgaged Property; and, as of the Purchase Date for the related Purchased
Asset, all insurance coverage required under the Mezzanine Loan Documents and/or
any Underlying Mortgage Loan related to the Underlying Mortgaged Property, which
insurance covers such risks and is in such amounts as are customarily acceptable
to prudent commercial and multifamily mortgage lending institutions lending on
the security of property comparable to the related Underlying Mortgaged Property
in the jurisdiction in which such Underlying Mortgaged Property is located, is
in full force and effect with respect to each related Underlying Mortgaged
Property; all premiums due and payable through the Purchase Date for the related
Purchased Asset have been paid; and no notice of termination or cancellation
with respect to any such insurance policy has been received by Seller; and
except for certain amounts not greater than amounts which would be considered
prudent by an institutional commercial and/or multifamily mortgage lender with
respect to a similar mortgage loan and which are set forth in the Mezzanine Loan
Documents and/or any Underlying Mortgage Loan related to the Underlying
Mortgaged Property, any insurance proceeds in respect of a casualty loss, will
be applied either (i) to the repair or restoration of all or part of the related
Underlying Mortgaged Property or (ii) the reduction of the outstanding principal
balance of the Underlying Mortgage Loan, subject in either case to requirements
with respect to leases at the related Underlying Mortgaged Property and to other
exceptions customarily provided for by prudent institutional lenders for similar
loans. The Underlying Mortgaged Property is also covered by comprehensive
general liability insurance against claims for personal and bodily injury, death
or property damage occurring on, in or about the related Underlying Mortgaged
Property, in an amount customarily required by prudent institutional lenders.
With respect to a U.S. Purchased Asset, an architectural or engineering
consultant has performed an analysis of the Underlying Mortgaged Properties
located in seismic zone 3 or 4 in order to evaluate the structural and seismic
condition of such property, for the sole purpose of assessing the probable
maximum loss (“PML”) for the Underlying Mortgaged Property in the event of an
earthquake. In such instance, the PML was based on a 475 year lookback with a
10% probability of exceedance in a 50 year period. If the resulting report
concluded that the PML would exceed 20% of the amount of the replacement costs
of the improvements, earthquake insurance on such Underlying Mortgaged Property
was

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

obtained by an insurer rated at least A-:V by A.M. Best Company or “BBB-” (or
the equivalent) from S&P and Fitch or “Baa3” (or the equivalent) from Moody’s.
If the Underlying Mortgaged Property is located in Florida or within 25 miles of
the coast of Texas, Louisiana, Mississippi, Alabama, Georgia, North Carolina or
South Carolina such Underlying Mortgaged Property is insured by windstorm
insurance in an amount at least equal to the lesser of (i) the outstanding
principal balance of such Underlying Mortgage Loan and (ii) 100% of the full
insurable value, or 100% of the replacement cost, of the improvements located on
the related Underlying Mortgaged Property.

(ff) The insurance policies contain a standard Mortgagee clause naming the
Mortgagee, its successors and assigns as loss payee, in the case of a property
insurance policy, and additional insured in the case of a liability insurance
policy and provide that they are not terminable without 30 days prior written
notice to the Mortgagee (or, with respect to non-payment, 10 days prior written
notice to the Mortgagee) or such lesser period as prescribed by applicable law.
Each Mortgage requires that the Mortgagor maintain insurance as described above
or permits the Mortgagee to require insurance as described above, and permits
the Mortgagee to purchase such insurance at the Mortgagor’s expense if Mortgagor
fails to do so.

(gg) There is no material and adverse environmental condition or circumstance
affecting the Underlying Mortgaged Property; there is no material violation of
any applicable Environmental Law with respect to the Underlying Mortgaged
Property; neither Seller nor the Underlying Property Owner has taken any actions
which would cause the Underlying Mortgaged Property not to be in compliance with
all applicable Environmental Laws; the underlying mortgage loan documents
require the borrower to comply with all Environmental Laws; and each Mortgagor
has agreed to indemnify the Mortgagee for any losses resulting from any
material, adverse environmental condition or failure of the Mortgagor to abide
by such Environmental Laws or has provided environmental insurance.

(hh) No borrower under the Mezzanine Loan nor any Mortgagor under any Underlying
Mortgage Loan is a debtor in any state or federal bankruptcy or insolvency
proceeding.

(ii) Each related Underlying Mortgaged Property was inspected by or on behalf of
the related originator or an affiliate during the 12 month period prior to the
related origination date.

(jj) There are no material violations of any applicable zoning ordinances,
building codes and land laws applicable to the Underlying Mortgaged Property or
the use and occupancy thereof which (i) are not insured by an ALTA lender’s
title insurance policy (or a binding commitment therefor), or its equivalent as
adopted in the applicable jurisdiction, or a law and ordinance insurance policy
or, with respect to a Foreign Purchased Asset, that have not been fully
disclosed in the related Property Report or (ii) would have a material adverse
effect on the value, operation or net operating income of the Underlying
Mortgaged Property. The Purchased Asset Documents and the underlying mortgage
loan documents require the Underlying Mortgaged Property to comply with all
applicable laws and ordinances.

(kk) None of the material improvements which were included for the purposes of
determining the appraised value of any related Underlying Mortgaged Property at
the time of the origination of the Mezzanine Loan or any related Underlying
Mortgage Loan lies outside of the

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

boundaries and building restriction lines of such property (except Underlying
Mortgaged Properties which are legal non-conforming uses), to an extent which
would have a material adverse effect on the value of the Underlying Mortgaged
Property or the related Mortgagor’s use and operation of such Underlying
Mortgaged Property (unless affirmatively covered by title insurance) and no
improvements on adjoining properties encroached upon such Underlying Mortgaged
Property to any material and adverse extent (unless affirmatively covered by
title insurance).

(ll) As of the Purchase Date for the related Purchased Asset, there was no
pending action, suit or proceeding, or governmental investigation of which
Seller, the Mezzanine Borrower or the Underlying Property Owner has received
notice, against the Mortgagor or the related Underlying Mortgaged Property the
adverse outcome of which could reasonably be expected to materially and
adversely affect the Mezzanine Loan or the Underlying Mortgage Loan.

(mm) The improvements located on the Underlying Mortgaged Property are either
not located in a federally designated special flood hazard area or, if so
located, the Mortgagor is required to maintain or the Mortgagee maintains, flood
insurance with respect to such improvements and such policy is in full force and
effect in an amount no less than the lesser of (i) the original principal
balance of the Underlying Mortgage Loan, (ii) the value of such improvements on
the related Underlying Mortgaged Property located in such flood hazard area or
(iii) the maximum allowed under the related federal flood insurance program.

(nn) Except for Mortgagors under Underlying Mortgage Loans the Underlying
Mortgaged Property with respect to which includes a Ground Lease, the related
Mortgagor (or its affiliate) has title in the fee simple interest in each
related Underlying Mortgaged Property.

(oo) The related Underlying Mortgaged Property is not encumbered, and none of
the Purchased Asset Documents or any underlying mortgage loan documents permits
the related Underlying Mortgaged Property to be encumbered subsequent to the
Purchase Date of the related Purchased Asset without the prior written consent
of the holder thereof, by any lien securing the payment of money junior to or of
equal priority with, or superior to, the lien of the related Mortgage (other
than title exceptions, taxes, assessments and contested mechanics and
materialmen’s liens that become payable after such Purchase Date).

(pp) With respect to U.S. Purchased Assets, each related Underlying Mortgaged
Property constitutes one or more complete separate tax lots (or the related
Mortgagor has covenanted to obtain separate tax lots and a Person has
indemnified the Mortgagee for any loss suffered in connection therewith or an
escrow of funds in an amount sufficient to pay taxes resulting from a breach
thereof has been established) or is subject to an endorsement under the related
title insurance policy.

(qq) An appraisal of the related Underlying Mortgaged Property was conducted in
connection with the origination of the Underlying Mortgage Loan; and such
appraisal satisfied either (A) the requirements of the “Uniform Standards of
Professional Appraisal Practice” as adopted by the Appraisal Standards Board of
the Appraisal Foundation or, in the case of an Underlying Mortgaged Property
located in England and Wales, the Valuations Standards (Red

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

Book) published by the Royal Institute of Chartered Surveyors, or (B) the
guidelines in Title XI of the Financial Institutions Reform, Recovery and
Enforcement Act or 1989, in either case as in effect on the date such Underlying
Mortgage Loan was originated.

(rr) The related Underlying Mortgaged Property is served by public utilities,
water and sewer (or septic facilities) and otherwise appropriate for the use in
which the Underlying Mortgaged Property is currently being utilized.

(ss) With respect to each related Underlying Mortgaged Property consisting of a
Ground Lease, Seller represents and warrants the following with respect to the
related Ground Lease:

I. Such Ground Lease or a memorandum thereof has been or will be duly recorded
or registered no later than 30 days after the Purchase Date of the related
Purchased Asset and such Ground Lease permits the interest of the lessee
thereunder to be encumbered by the related Mortgage or, if consent of the lessor
thereunder is required, it has been obtained prior to the Purchase Date.

II. Upon the foreclosure of the Underlying Mortgage Loan (or acceptance of a
deed in lieu thereof), the Mortgagor’s interest in such Ground Lease is
assignable to the Mortgagee under the leasehold estate and its assigns without
the consent of the lessor thereunder (or, if any such consent is required, it
has been obtained prior to the Purchase Date).

III. Such Ground Lease may not be amended, modified, canceled or terminated
without the prior written consent of the Mortgagee and any such action without
such consent is not binding on the Mortgagee, its successors or assigns, except
termination or cancellation if (i) an event of default occurs under the Ground
Lease, (ii) notice thereof is provided to the Mortgagee and (iii) such default
is curable by the Mortgagee as provided in the Ground Lease but remains uncured
beyond the applicable cure period.

IV. Such Ground Lease is in full force and effect, there is no material default
under such Ground Lease, and there is no event which, with the passage of time
or with notice and the expiration of any grace or cure period, would constitute
a material default under such Ground Lease.

V. The Ground Lease or ancillary agreement between the lessor and the lessee
requires the lessor to give notice of any default by the lessee to the
Mortgagee. The Ground Lease or ancillary agreement further provides that no
notice given is effective against the Mortgagee unless a copy has been given to
the Mortgagee in a manner described in the Ground Lease or ancillary agreement.

VI. The Ground Lease (i) is not subject to any liens or encumbrances superior
to, or of equal priority with, the Mortgage, subject, however, to only the Title
Exceptions or (ii) is subject to a subordination, non-disturbance and attornment
agreement to which the Mortgagee on the lessor’s fee interest in the Underlying
Mortgaged Property is subject.

VII. A Mortgagee is permitted a reasonable opportunity (including, where
necessary, sufficient time to gain possession of the interest of the lessee
under the Ground Lease) to cure any curable default under such Ground Lease
before the lessor thereunder may terminate such Ground Lease.

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

VIII. Such Ground Lease has an original term (together with any extension
options, whether or not currently exercised, set forth therein all of which can
be exercised by the Mortgagee if the Mortgagee acquires the lessee’s rights
under the Ground Lease) that extends not less than 20 years beyond the stated
maturity date.

IX. Under the terms of such Ground Lease, any estoppel or consent letter
received by the Mortgagee from the lessor, and the related Mortgage, taken
together, any related insurance proceeds or condemnation award (other than in
respect of a total or substantially total loss or taking) will be applied either
to the repair or restoration of all or part of the related Underlying Mortgaged
Property, with 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 or defeasance of the outstanding principal balance of the Underlying
Mortgage Loan, together with any accrued interest (except in cases where a
different allocation would not be viewed as commercially unreasonable by any
commercial mortgage lender, taking into account the relative duration of the
Ground Lease and the related Mortgage and the ratio of the market value of the
related Underlying Mortgaged Property to the outstanding principal balance of
such Underlying Mortgage Loan).

X. The Ground Lease does not impose any restrictions on subletting that would be
viewed as commercially unreasonable by a prudent commercial lender.

XI. The ground lessor under such Ground Lease is required to enter into a new
lease upon termination of the Ground Lease for any reason, including the
rejection of the Ground Lease in bankruptcy.

(tt) The assignment of the Purchased Asset constitutes the legal, valid and
binding assignment of such Purchased Asset from Seller to or for the benefit of
Buyer enforceable in accordance with its terms, except as such enforcement may
be limited by bankruptcy, insolvency, reorganization, receivership, moratorium
or other laws relating to or affecting the rights of creditors generally and by
general principles of equity (regardless of whether such enforcement is
considered in a proceeding in equity or at law).

(uu) Seller has complied with its internal procedures with respect to all
applicable anti-money laundering laws and regulations, including without
limitation the USA Patriot Act of 2001 in connection with the origination of the
Senior Mortgage Loan.

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

EXHIBIT VII

U.S. PURCHASED ASSET

ASSET INFORMATION

Loan ID #:

Borrower Name:

Borrower Address:

Borrower City:

Borrower State:

Borrower Zip Code:

Recourse?

Guaranteed?

Related Borrower Name(s):

Original Principal Balance:

Note Date:

Loan Date:

Loan Type (e.g. fixed/arm):

Current Principal Balance:

Current Interest Rate (per annum):

Paid to date:

Annual P&I:

Next Payment due date:

Index (complete whether fixed or arm):

Gross Spread/Margin (complete whether fixed or arm):

Life Cap:

Life Floor:

Periodic Cap:

Periodic Floor:

Rounding Factor:

Lookback (in days):

Interest Calculation Method (e.g., Actual/360):

Interest rate adjustment frequency:

P&I payment frequency:

First P&I payment due:

First interest rate adjustment date:

First payment adjustment date:

Next interest rate adjustment date:

Next payment adjustment date:

Conversion Date:

Converted Interest Rate Index:

Converted Interest Rate Spread:

Maturity date:

Loan term:

Amortization term:

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

Hyper-Amortization Flag:

Hyper-Amortization Term:

Hyper-Amortization Rate Increase:

Balloon Amount:

Balloon LTV:

Prepayment Penalty Flag:

Prepayment Penalty Text:

Lockout Period:

Lien Position:

Fee/Leasehold:

Ground Lease Expiration Date:

CTL (Yes/No):

CTL Rating (Moody’s):

CTL Rating (Duff):

CTL Rating (S&P):

CTL Rating (Fitch):

Lease Guarantor:

CTL Lease Type (NNN, NN, Bondable):

Property Name:

Property Address:

Property City:

Property Zip Code:

Property Type (General):

Property Type (Specific):

Cross-collateralized (Yes/No)††:

Property Size:

Year built:

Year renovated:

Actual Average Occupancy:

Occupancy Rent Roll Date:

Underwritten Average Occupancy:

Largest Tenant:

Largest Tenant SF:

Largest Tenant Lease Expiration:

2nd Largest Tenant:

2nd Largest Tenant SF:

2nd Largest Tenant Lease Expiration:

3rd Largest Tenant:

3rd Largest Tenant SF:

3rd Largest Tenant Lease Expiration:

Underwritten Average Rental Rate/ADR:

Underwritten Vacancy/Credit Loss:

Underwritten Other Income:

 

††

If yes, give property information on each property covered and in aggregate as
appropriate. Loan ID’s should be denoted with a suffix letter to signify
loans/collateral.

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

Underwritten Total Revenues:

Underwritten Replacement Reserves:

Underwritten Management Fees:

Underwritten Franchise Fees:

Underwritten Total Expenses:

Underwritten Leasing Commissions:

Underwritten Tenant Improvement Costs:

Underwritten NOI:

Underwritten NCF:

Underwritten Debt Service Constant:

Underwritten DSCR at NOI:

Underwritten DSCR at NCF:

Underwritten NOI Period End Date:

Hotel Franchise:

Hotel Franchise Expiration Date:

Appraiser Name:

Appraised Value:

Appraisal Date:

Appraisal Cap Rate:

Appraisal Discount Rate:

Underwritten LTV:

Environmental Report Preparer:

Environmental Report Date:

Environmental Report Issues:

Architectural and Engineering Report Preparer:

Architectural and Engineering Report Date:

Deferred Maintenance Amount:

Ongoing Replacement Reserve Requirement per A&E Report:

Immediate Repairs Escrow % (e.g. [    ]%):

Replacement Reserve Annual Deposit:

Replacement Reserve Balance:

Tenant Improvement/Leasing Commission Annual Deposits:

Tenant Improvement/Leasing Commission Balance:

Taxes paid through date:

Monthly Tax Escrow:

Tax Escrow Balance:

Insurance paid through date:

Monthly Insurance Escrow:

Insurance Escrow Balance:

Reserve/Escrow Balance as of Date:

Probable Maximum Loss %:

Covered by Earthquake Insurance (Yes/No):

Number of times 30 days late in last 12 months:

Number of times 60 days late in last 12 months:

Number of times 90 days late in last 12 months:

Servicing Fee:

Notes:

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

FOREIGN PURCHASED ASSET

ASSET INFORMATION

Loan ID #:

Borrower Name:

Borrower Address:

Borrower City:

Borrower State:

Borrower Zip Code:

Recourse?

Guaranteed?

Related Borrower Name(s):

Original Principal Balance:

Note Date:

Loan Date:

Loan Type (e.g. fixed/arm):

Current Principal Balance:

Current Interest Rate (per annum):

Current Drawn Balance:

Drawdown History (amounts and dates):

Undrawn Amount:

Paid to date:

Annual P&I:

Next Payment due date:

Index (complete whether fixed or arm):

Gross Spread/Margin (complete whether fixed or arm):

Life Cap:

Life Floor:

Periodic Cap:

Periodic Floor:

Rounding Factor:

Lookback (in days):

Interest Calculation Method (e.g., Actual/360):

Interest rate adjustment frequency:

P&I payment frequency:

First P&I payment due:

First interest rate adjustment date:

First payment adjustment date:

Next interest rate adjustment date:

Next payment adjustment date:

Conversion Date:

Converted Interest Rate Index:

Converted Interest Rate Spread:

Maturity date:

Loan term:

Amortization term:

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

Hyper-Amortization Flag:

Hyper-Amortization Term:

Hyper-Amortization Rate Increase:

Balloon Amount:

Balloon LTV:

Prepayment Penalty Flag:

Prepayment Penalty Text:

Lockout Period:

Lien Position:

Fee/Leasehold:

Ground Lease Expiration Date:

CTL (Yes/No):

CTL Rating (Moody’s):

CTL Rating (Duff):

CTL Rating (S&P):

CTL Rating (Fitch):

Lease Guarantor:

CTL Lease Type (NNN, NN, Bondable):

Property Name:

Property Address:

Property City:

Property Zip Code:

Property Type (General):

Property Type (Specific):

Cross-collateralized (Yes/No)‡‡:

Property Size:

Year built:

Year renovated:

Actual Average Occupancy:

Occupancy Rent Roll Date:

Underwritten Average Occupancy:

Largest Tenant:

Largest Tenant SF:

Largest Tenant Lease Expiration:

2nd Largest Tenant:

2nd Largest Tenant SF:

2nd Largest Tenant Lease Expiration:

3rd Largest Tenant:

3rd Largest Tenant SF:

3rd Largest Tenant Lease Expiration:

Underwritten Average Rental Rate/ADR:

Underwritten Vacancy/Credit Loss:

Underwritten Other Income:

 

‡‡

If yes, give property information on each property covered and in aggregate as
appropriate. Loan ID’s should be denoted with a suffix letter to signify
loans/collateral.

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

Underwritten Total Revenues:

Underwritten Replacement Reserves:

Underwritten Management Fees:

Underwritten Franchise Fees:

Underwritten Total Expenses:

Underwritten Leasing Commissions:

Underwritten Tenant Improvement Costs:

Underwritten NOI:

Underwritten NCF:

Underwritten Debt Service Constant:

Underwritten DSCR at NOI:

Underwritten DSCR at NCF:

Underwritten NOI Period End Date:

Hotel Franchise:

Hotel Franchise Expiration Date:

Appraiser Name:

Appraised Value:

Appraisal Date:

Appraisal Cap Rate:

Appraisal Discount Rate:

Underwritten LTV:

Environmental Report Preparer:

Environmental Report Date:

Environmental Report Issues:

Architectural and Engineering Report Preparer:

Architectural and Engineering Report Date:

Deferred Maintenance Amount:

Ongoing Replacement Reserve Requirement per A&E Report:

Immediate Repairs Escrow % (e.g. [    ]%):

Replacement Reserve Annual Deposit:

Replacement Reserve Balance:

Tenant Improvement/Leasing Commission Annual Deposits:

Tenant Improvement/Leasing Commission Balance:

Taxes paid through date:

Monthly Tax Escrow:

Tax Escrow Balance:

Insurance paid through date:

Monthly Insurance Escrow:

Insurance Escrow Balance:

Reserve/Escrow Balance as of Date:

Probable Maximum Loss %:

Covered by Earthquake Insurance (Yes/No):

Number of times 30 days late in last 12 months:

Number of times 60 days late in last 12 months:

Number of times 90 days late in last 12 months:

Servicing Fee:

Notes:

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

EXHIBIT VIII

PURCHASE PROCEDURES

(a) Submission of Due Diligence Package. No less than fifteen (15) Business Days
prior to the proposed Purchase Date or date of an Additional Purchase
Transaction or Future Funding Transaction, as applicable, Seller shall deliver
to Buyer a due diligence package for Buyer’s review and approval, which shall
contain the following items (the “Due Diligence Package”):

 

  1.

Delivery of Purchased Asset Documents. With respect to a New Asset that is a
Pre-Existing Asset, each of the Purchased Asset Documents and, with respect to a
Purchased Asset that is the subject of a proposed Additional Purchase
Transaction or Future Funding Transaction, any Purchased Asset Document that has
been modified or amended in any manner since the related Purchase Date.

 

  2.

Transaction-Specific Due Diligence Materials. With respect to any New Asset or
Purchased Asset that is the subject of a proposed Additional Purchase
Transaction or Future Funding Transaction, a summary memorandum outlining the
proposed transaction or advance, as applicable, including potential benefits and
all material underwriting risks, all Underwriting Issues and all other
characteristics of the proposed transaction or advance, as applicable, that a
reasonable buyer would consider material, together with the following due
diligence information relating to the New Asset or, with respect to a Purchased
Asset that is the subject of a proposed Additional Purchase Transaction or
Future Funding Transaction, any updates to the following due diligence
information reflecting changes from the related Purchase Date:

(a) the Asset Information and, if available, maps and photos;

(b) a current rent roll and roll over schedule, if applicable;

(c) a cash flow pro-forma, plus historical information, if available;

(d) copies of appraisal, environmental, engineering and any other third-party
reports; provided, that, if same are not available to Seller at the time of
Seller’s submission of the Due Diligence Package to Buyer, Seller shall deliver
such items to Buyer promptly upon Seller’s receipt of such items;

(e) a description of the underlying real estate directly or indirectly securing
or supporting such Purchased Asset and the ownership structure of the borrower
and the sponsor (including, without limitation, the board of directors, if
applicable) and, to the extent that real property does not secure such Eligible
Asset, the related collateral securing such Eligible Asset, if any;

(f) indicative debt service coverage ratios;

(g) indicative loan-to-value ratios;

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

(h) a term sheet outlining the transaction generally;

(i) a description of the Mortgagor, including experience with other projects
(real estate owned), its ownership structure and financial statements;

(j) a description of Seller’s relationship with the Mortgagor, if any;

(k) copies of documents evidencing such New Asset, or current drafts thereof,
including, without limitation, underlying debt and security documents,
guaranties, the underlying borrower’s and guarantor’s organizational documents,
warrant agreements, and loan and collateral pledge agreements, as applicable,
provided that, if same are not available to Seller at the time of Seller’s
submission of the Due Diligence Package to Buyer, Seller shall deliver such
items to Buyer promptly upon Seller’s receipt of such items;

(l) in the case of Subordinate Eligible Assets, all information described in
this section 2(A) that would otherwise be provided for the Underlying Mortgage
Loan if it were an Eligible Asset, and in addition, all documentation evidencing
such Subordinate Eligible Asset; and

(m) any exceptions to the representations and warranties set forth in Exhibit VI
to this Agreement.

 

  3.

Environmental and Engineering. A “Phase 1” (and, if requested by Buyer, “Phase
2”) environmental report, an asbestos survey, if applicable, and an engineering
report, each in form reasonably satisfactory to Buyer, by an engineer or
environmental consultant reasonably approved by Buyer.

 

  4.

Credit Memorandum. A credit memorandum, asset summary or other similar document
that details cash flow underwriting, historical operating numbers, underwriting
footnotes, rent roll and lease rollover schedule.

 

  5.

Appraisal. Either an appraisal approved by Buyer or a draft appraisal, each by
an MAI appraiser (or RICS appraiser with respect to a Foreign Purchased Asset),
if applicable. If Buyer receives only a draft appraisal prior to entering into a
Transaction, Seller shall deliver an appraisal approved by Buyer by an MAI
appraiser on or before ten (10) calendar days after the Purchase Date. The
related appraisal shall (i) be dated less than twelve (12) months prior to the
proposed financing date and (ii) not be ordered by the related borrower or an
Affiliate of the related borrower.

 

  6.

Opinions of Counsel. An opinion to Seller and its successors and assigns from
counsel to the underlying obligor on the underlying loan transaction, as
applicable, as to enforceability of the loan documents governing such
transaction and such other matters as Buyer shall require (including, without
limitation, opinions as to due formation, authority, choice of law and
perfection of security interests).

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

  7.

Additional Real Estate Matters. To the extent obtained by Seller from the
Mortgagor or the underlying obligor relating to any Eligible Asset at the
origination of the Eligible Asset, such other real estate related certificates
and documentation as may have been requested by Buyer, such as abstracts of all
leases in effect at the real property relating to such Eligible Asset.

 

  8.

Other Documents. Any other documents as Buyer or its counsel shall reasonably
deem necessary.

(b) Submission of Legal Documents. With respect to a New Asset that is an
Originated Asset, no less than seven (7) calendar days prior to the proposed
Purchase Date, Seller shall deliver, or cause to be delivered, to counsel for
Buyer the following items, where applicable:

 

  1.

Copies of all draft Purchased Asset Documents in substantially final form,
blacklined against the approved form Purchased Asset Documents.

 

  2.

Certificates or other evidence of insurance demonstrating insurance coverage in
respect of the underlying real estate directly or indirectly securing or
supporting such Purchased Asset of types, in amounts, with insurers and
otherwise in compliance with the terms, provisions and conditions set forth in
the Purchased Asset Documents. Such certificates or other evidence shall
indicate that Seller (or, as to Subordinate Eligible Assets, the lead lender on
the whole loan in which Seller is a participant or holder of a note or has an
equity interest in the Mortgagor, as applicable), will be named as an additional
insured as its interest may appear and shall contain a loss payee endorsement in
favor of such additional insured with respect to the policies required to be
maintained under the Purchased Asset Documents.

 

  3.

All surveys of the underlying real estate directly or indirectly securing or
supporting such Purchased Asset that are in Seller’s possession.

 

  4.

As reasonably requested by Buyer, satisfactory reports of UCC (with respect to
U.S. Purchased Assets), tax lien, judgment and litigation searches and title
updates as customary for the applicable jurisdiction conducted by search firms
and/or title companies reasonably acceptable to Buyer with respect to the
Eligible Asset, underlying real estate directly or indirectly securing or
supporting such Eligible Asset, Seller and Mortgagor, such searches to be
conducted in each location Buyer shall reasonably designate.

 

  5.

With respect to a U.S. Purchased Asset, an unconditional commitment to issue a
Title Policy in favor of Buyer and Buyer’s successors and/or assigns with
respect to Buyer’s interest in the related real property and insuring the
assignment of the Eligible Asset to Buyer, with an amount of insurance that
shall be not less than the maximum principal amount of the Eligible Asset
(taking into account the proposed advance), or an endorsement or confirmatory
letter from the title insurance company that issued the existing title insurance
policy, in favor of

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

 

Buyer and Buyer’s successors and/or assigns, that amends the existing title
insurance policy by stating that the amount of the insurance is not less than
the maximum principal amount of the Eligible Asset (taking into account the
proposed advance).

 

  6.

Certificates of occupancy and letters certifying that the property is in
compliance with all applicable planning and/or zoning laws, each issued by the
appropriate Governmental Authority.

(c) Approval of Eligible Asset, Additional Purchase Transaction or Future
Funding Transaction. Conditioned upon the timely and satisfactory completion of
Seller’s requirements in clauses (a) and (b) above, Buyer shall, no less than
five (5) calendar days prior to the proposed Purchase Date, date of Additional
Purchase Transaction or date of Future Funding Transaction, as applicable,
(i) in the case of the proposed purchase of an Eligible Asset, (A) notify Seller
in writing (which may take the form of electronic mail format) that Buyer has
not approved the proposed Eligible Asset as a Purchased Asset or (B) notify
Seller in writing (which may take the form of electronic mail format) that Buyer
has approved the proposed Eligible Asset as a Purchased Asset or (ii) in the
case of a proposed Additional Purchase Transaction or Future Funding
Transaction, (A) notify Seller in writing (which may take the form of electronic
mail format) that Buyer has not approved the proposed Additional Purchase
Transaction or Future Funding Transaction or (B) notify Seller in writing (which
may take the form of electronic mail format) that Buyer has approved the
proposed Additional Purchase Transaction or Future Funding Transaction. Buyer’s
failure to respond to Seller on or prior to five (5) calendar days prior to the
proposed Purchase Date, shall be deemed to be a denial of Seller’s request that
Buyer approve the proposed Eligible Asset or proposed Additional Purchase
Transaction or Future Funding Transaction, as applicable, unless Buyer and
Seller has agreed otherwise in writing.

(d) Assignment Documents. No less than two (2) business days prior to the
proposed Purchase Date, Seller shall have executed and delivered to Buyer, in
form and substance reasonably satisfactory to Buyer and its counsel, all
applicable assignment documents assigning to Buyer the proposed Eligible Asset
(and in any Hedging Transactions held by Seller with respect thereto) that shall
be subject to no liens except as expressly permitted by Buyer. Each of the
assignment documents shall contain such representations and warranties in
writing concerning the proposed Eligible Asset and such other terms as shall be
satisfactory to Buyer in its sole discretion.

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

EXHIBIT IX

FORM OF BAILEE LETTER

        , 201  

 

 

  Re:

Bailee Agreement (the “Bailee Agreement”) in connection with the pledge by
[        ] ( “Seller”) to JPMorgan Chase Bank, National Association (“Buyer”)

Ladies and Gentlemen:

In consideration of the mutual promises set forth herein and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Seller, Buyer and [        ] (the “Bailee”) hereby agree as
follows:

(a) Seller shall deliver to the Bailee in connection with any Purchased Assets
delivered to the Bailee hereunder the Custodial Delivery Certificate to which
shall be attached a Purchased Asset Schedule identifying which Purchased Assets
are being delivered to the Bailee hereunder.

(b) On or prior to the date indicated on the Custodial Delivery Certificate
delivered by Seller (the “Funding Date”), Seller shall have delivered to the
Bailee, as bailee for hire, the original documents set forth on Exhibit B
attached thereto (collectively, the “Purchased Asset File”) for each of the
Purchased Assets (each a “Purchased Asset” and collectively, the “Purchased
Assets”) listed in Exhibit A attached thereto.

(c) The Bailee shall issue and deliver to Buyer and U.S. Bank National
Association (the “Custodian”) on or prior to the Funding Date by facsimile
(a) in the name of Buyer, an initial trust receipt and certification in the form
of Attachment 2 attached hereto (the “Bailee’s Trust Receipt and Certification”)
which Bailee’s Trust Receipt and Certification shall state that the Bailee has
received the documents comprising the Purchased Asset File as set forth in the
Custodial Delivery Certificate.

(d) On the applicable Funding Date, in the event that Buyer fails to purchase
from Seller the Purchased Assets identified in the related Custodial Delivery
Certificate, Buyer shall deliver by facsimile to the Bailee at         ] to the
attention of [        ], an authorization (the “Facsimile Authorization”) to
release the Purchased Asset Files with respect to the Purchased Assets
identified therein to Seller. Upon receipt of such Facsimile Authorization, the
Bailee shall release the Purchased Asset Files to Seller in accordance with
Seller’s instructions.

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

(e) Following the Funding Date, the Bailee shall forward the Purchased Asset
Files to the Custodian at [        ], by insured overnight courier for receipt
by the Custodian no later than 1:00 p.m. on the third (3rd) Business Day
following the applicable Funding Date (the “Delivery Date”).

(f) From and after the applicable Funding Date until the time of receipt of the
Facsimile Authorization or the applicable Delivery Date, as applicable, the
Bailee (a) shall maintain continuous custody (and will forward in accordance
with clause (e) above) and control of the related Purchased Asset Files as
bailee for Buyer and (b) is holding the related Purchased Assets as sole and
exclusive bailee for Buyer unless and until otherwise instructed in writing by
Buyer.

(g) Seller agrees to indemnify and hold the Bailee and its partners, directors,
officers, agents and employees harmless against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever, including reasonable
attorneys fees, that may be imposed on, incurred by, or asserted against it or
them in any way relating to or arising out of this Bailee Agreement or any
action taken or not taken by it or them hereunder unless such liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements (other than special, indirect, punitive or
consequential damages, which shall in no event be paid by the Bailee) were
imposed on, incurred by or asserted against the Bailee because of the breach by
the Bailee of its obligations hereunder, which breach was caused by gross
negligence or willful misconduct on the part of the Bailee or any of its
partners, directors, officers, agents or employees. The foregoing
indemnification shall survive any resignation or removal of the Bailee or the
termination or assignment of this Bailee Agreement.

(h) In the event that the Bailee fails to produce a Mortgage Note, assignment of
collateral or any other document related to a Purchased Asset that is (or was
required to be) then in its possession within ten (10) business days after
required or requested by Seller or Buyer (a “Delivery Failure”), the Bailee
shall indemnify Seller or Buyer in accordance with the paragraph (g) above.

(i) Seller agrees to indemnify and hold Buyer and its respective affiliates and
designees harmless against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever, including reasonable attorneys fees, that may
be imposed on, incurred by, or asserted against it or them in any way relating
to or arising out of a Custodial Delivery Failure or the Bailee’s negligence,
lack of good faith or willful misconduct. The foregoing indemnification shall
survive any termination or assignment of this Bailee Agreement.

(j) Seller hereby represents, warrants and covenants that the Bailee is not an
affiliate of or otherwise controlled by Seller. Notwithstanding the foregoing,
the parties hereby acknowledge that the Bailee hereunder may act as

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

counsel to Seller in connection with a proposed transaction and [        ], if
acting as Bailee, has represented Seller in connection with negotiation,
execution and delivery of the Repurchase Agreement.

(k) [Arrangements to be discussed with respect to a pledge of Purchased Assets
as collateral for an obligation of Buyer held by the Bailee, such arrangements
to be agreed to by Bailee in its sole discretion without obligation.]

(l) The agreement set forth in this Bailee Agreement may not be modified,
amended or altered, except by written instrument, executed by all of the parties
hereto.

(m) This Bailee Agreement may not be assigned by Seller or the Bailee without
the prior written consent of Buyer.

(n) For the purpose of facilitating the execution of this Bailee Agreement as
herein provided and for other purposes, this Bailee Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute and be one
and the same instrument. Electronically transmitted signature pages shall be
binding to the same extent.

(o) This Bailee Agreement shall be construed in accordance with the laws of the
State of New York, and the obligations, rights and remedies of the parties
hereunder shall be determined in accordance with such laws.

(p) Capitalized terms used herein and defined herein shall have the meanings
ascribed to them in the Repurchase Agreement.

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

Very truly yours,

[                             ]

By:  

 

Name:   Title:  

 

ACCEPTED AND AGREED: [BAILEE] By:     Name:   ACCEPTED AND AGREED:

JPMORGAN CHASE BANK, NATIONAL ASSOCIATION,

Buyer

By:  

 

Name:   Title:  

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

Schedule A

[List of Purchased Asset Documents]

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

Attachment 1

IDENTIFICATION CERTIFICATE

On this [    ] day of [        ], 201[    ], [        ] (the “Seller”), under
that certain Bailee Agreement of even date herewith (the “Bailee Agreement”),
among Seller, [        ] (the “Bailee”), and JPMORGAN CHASE BANK, NATIONAL
ASSOCIATION, as Buyer, does hereby instruct the Bailee to hold, in its capacity
as Bailee, the Purchased Asset Files with respect to the Purchased Assets listed
on Exhibit A hereto, which Purchased Assets shall be subject to the terms of the
Bailee Agreement as of the date hereof.

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

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

 

[                            ] By:     Name:   Title:  

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

Exhibit A to Attachment 1

PURCHASED ASSET SCHEDULE

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

Attachment 2

FORM OF BAILEE’S TRUST RECEIPT AND CERTIFICATION

            , 201    

JPMORGAN CHASE BANK, NATIONAL ASSOCIATION

270 Park Avenue, 7th Floor

New York, New York 10017-2014

Attention: Ms. Nancy S. Alto

Telephone:(212) 834-9271

Telecopy:(212) 834-6565

 

  Re:

Bailee Agreement, dated as of [        ] [        ], 201[    ] (the “Bailee
Agreement”) among [        ] (the “Seller”), JPMorgan Chase Bank, National
Association (the “Buyer”) and [        ] (the “Bailee”)

Ladies and Gentlemen:

In accordance with the provisions of Paragraph 3 of the above-referenced Bailee
Agreement, the undersigned, as the Bailee, hereby certifies that as to each
Purchased Asset described in the Purchased Asset Schedule (Exhibit A to
Attachment 1), a copy of which is attached hereto, it has reviewed the Purchased
Asset File and has determined that (i) all documents listed in Schedule A
attached to the Bailee Agreement are in its possession and (ii) such documents
have been reviewed by it and appear regular on their face and relate to such
Purchased Asset, and (iii) based on its examination, the foregoing documents on
their face satisfy the requirements set forth in Paragraph 2 of the Bailee
Agreement.

The Bailee hereby confirms that it is holding each such Purchased Asset File as
agent and bailee for the exclusive use and benefit of Buyer pursuant to the
terms of the Bailee Agreement.

All initially capitalized terms used herein shall have the meanings ascribed to
them in the above-referenced Bailee Agreement.

 

[        ], BAILEE

By:

 

 

Name:

 

Title:

 

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

EXHIBIT X

FORM OF MARGIN DEFICIT NOTICE

[DATE]/[TIME]

VIA ELECTRONIC TRANSMISSION

[                             ]

[        ]

[        ]

Attn: [        ]

 

  Re:

Master Repurchase Agreement, dated as of December 20, 2013 (as amended,
restated, supplemented, or otherwise modified and in effect from time to time,
the “Master Repurchase Agreement”; capitalized terms used but not otherwise
defined herein shall have the meanings assigned thereto in the Master Repurchase
Agreement) by and between JPMorgan Chase Bank, National Association (“Buyer”)
and Parlex 4 UK Finco, LLC and Parlex 4 Finance, LLC (“Sellers”)

Pursuant to Article 4(a) of the Master Repurchase Agreement, Buyer hereby
notifies Sellers of the existence of a Margin Deficit as of the date hereof as
follows:

 

[Repurchase Price for specific Purchased Asset:

   $            

Asset Value of such Purchased Asset:

   $            

MARGIN DEFICIT:

   $            ]

[Aggregate Repurchase Price of all Purchased Assets:

   $            

Maximum Amount:

   $            

MARGIN DEFICIT:

   $            ]

SELLERS ARE REQUIRED TO CURE THE MARGIN DEFICIT SPECIFIED ABOVE IN ACCORDANCE
WITH THE MASTER REPURCHASE AGREEMENT AND WITHIN THE TIME PERIOD SPECIFIED
ARTICLE 4(a) THEREOF.

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

JPMORGAN CHASE BANK, NATIONAL ASSOCIATION

By:

 

 

Name

 

Title:

 

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

EXHIBIT XI

EXHIBIT XI-1

FORM OF

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Assignees That Are Not Partnerships For U.S. Federal Income Tax
Purposes)

Reference is hereby made to Article 3(r) of the Master Repurchase Agreement,
dated as of December 20, 2013 (the “Master Repurchase Agreement”), by and
between JPMorgan Chase Bank, National Association, a national banking
association organized under the laws of the United States, as Buyer, and Parlex
4 UK Finco, LLC and Parlex 4 Finance, LLC, each a Delaware limited liability
company, as Sellers. Capitalized terms used and not otherwise defined herein
shall have the respective meanings assigned to such terms in the Master
Repurchase Agreement.

The undersigned hereby certifies that (i) it is the sole record and beneficial
owner of the ownership interest in the Transaction(s) in respect of which it is
providing this certificate, (ii) it is not a bank within the meaning of
Section 881(c)(3)(A) of the Code, (iii) it is not a ten percent shareholder of
the applicable Seller(s) within the meaning of Section 871(h)(3)(B) of the Code
and (iv) it is not a controlled foreign corporation related to the applicable
Seller(s) as described in Section 881(c)(3)(C) of the Code.

The undersigned has furnished the applicable Seller(s) with a correct, complete,
and accurate executed IRS Form W-8BEN. By executing this certificate, the
undersigned agrees that (1) if the information provided on this certificate
changes, the undersigned shall promptly so inform the applicable Seller(s), and
(2) the undersigned shall have at all times furnished the applicable Seller(s)
with a properly completed and currently effective certificate in either the
calendar year in which each payment is to be made to the undersigned, or in
either of the two calendar years preceding such payments.

 

[NAME OF ASSIGNEE]

By:

 

 

Name:

 

Title:

 

Date:                     

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

EXHIBIT XI-2

FORM OF

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Participants That Are Not Partnerships For U.S. Federal Income Tax
Purposes)

Reference is hereby made to Article 3(r) of the Master Repurchase Agreement,
dated as of December 20, 2013 (the “Master Repurchase Agreement”), by and
between JPMorgan Chase Bank, National Association, a national banking
association organized under the laws of the United States, as Buyer, and Parlex
4 UK Finco, LLC and Parlex 4 Finance, LLC, each a Delaware limited liability
company, as Sellers. Capitalized terms used and not otherwise defined herein
shall have the respective meanings assigned to such terms in the Master
Repurchase Agreement.

The undersigned hereby certifies that (i) it is the sole record and beneficial
owner of the ownership interest in the Transaction(s) in respect of which it is
providing this certificate, (ii) it is not a bank within the meaning of
Section 881(c)(3)(A) of the Code, (iii) it is not a ten percent shareholder of
the applicable Seller(s) within the meaning of Section 871(h)(3)(B) of the Code,
and (iv) it is not a controlled foreign corporation related to the applicable
Seller(s) as described in Section 881(c)(3)(C) of the Code.

The undersigned has furnished the applicable Buyer or Assignee with a correct,
complete, and accurate executed IRS Form W-8BEN. By executing this certificate,
the undersigned agrees that (1) if the information provided on this certificate
changes, the undersigned shall promptly so inform such Buyer or Assignee in
writing, and (2) the undersigned shall have at all times furnished such Buyer or
Assignee with a properly completed and currently effective certificate in either
the calendar year in which each payment is to be made to the undersigned, or in
either of the two calendar years preceding such payments.

 

[NAME OF PARTICIPANT]

By:

 

 

Name:

 

Title:

 

Date:                         

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

EXHIBIT XI-3

FORM OF

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Participants That Are Partnerships For U.S. Federal Income Tax
Purposes)

Reference is hereby made to Article 3(r) of the Master Repurchase Agreement,
dated as of December 20, 2013 (the “Master Repurchase Agreement”), by and
between JPMorgan Chase Bank, National Association, a national banking
association organized under the laws of the United States, as Buyer, and Parlex
4 UK Finco, LLC and Parlex 4 Finance, LLC, each a Delaware limited liability
company, as Sellers. Capitalized terms used and not otherwise defined herein
shall have the respective meanings assigned to such terms in the Master
Repurchase Agreement.

The undersigned hereby certifies that (i) it is the sole record owner of the
ownership interest in the Transaction(s) in respect of which it is providing
this certificate, (ii) its direct or indirect partners/members are the sole
beneficial owners of such interest, (iii) with respect to such interest, neither
the undersigned nor any of its direct or indirect partners/members is a bank
extending credit pursuant to a loan agreement entered into in the ordinary
course of its trade or business within the meaning of Section 881(c)(3)(A) of
the Code, (iv) none of its direct or indirect partners/members is a ten percent
shareholder of the applicable Seller(s) within the meaning of
Section 871(h)(3)(B) of the Code and (v) none of its direct or indirect
partners/members is a controlled foreign corporation related to the applicable
Seller(s) as described in Section 881(c)(3)(C) of the Code.

The undersigned has furnished the applicable Buyer or Assignee with a correct,
complete, and accurate executed IRS Form W-8IMY accompanied by one of the
following forms from each of its partners/members that is claiming the portfolio
interest exemption: (i) an IRS Form W-8BEN or (ii) an IRS Form W-8IMY
accompanied by an IRS Form W-8BEN from each of such partner’s/member’s
beneficial owners that is claiming the portfolio interest exemption. By
executing this certificate, the undersigned agrees that (1) if the information
provided on this certificate changes, the undersigned shall promptly so inform
such Buyer or Assignee and (2) the undersigned shall have at all times furnished
such Buyer or Assignee with a properly completed and currently effective
certificate in either the calendar year in which each payment is to be made to
the undersigned, or in either of the two calendar years preceding such payments.

 

[NAME OF PARTICIPANT]

By:

 

 

Name:

 

Title:

 

Date:                         

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

EXHIBIT XI-4

FORM OF

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Assignees That Are Partnerships For U.S. Federal Income Tax
Purposes)

Reference is hereby made to Article 3(r) of the Master Repurchase Agreement,
dated as of December 20, 2013 (the “Master Repurchase Agreement”), by and
between JPMorgan Chase Bank, National Association, a national banking
association organized under the laws of the United States, as Buyer, and Parlex
4 UK Finco, LLC and Parlex 4 Finance, LLC, each a Delaware limited liability
company, as Sellers. Capitalized terms used and not otherwise defined herein
shall have the respective meanings assigned to such terms in the Master
Repurchase Agreement.

The undersigned hereby certifies that (i) it is the sole record owner of the
ownership interest in the Transaction(s) in respect of which it is providing
this certificate, (ii) its direct or indirect partners/members are the sole
beneficial owners of such interest, (iii) with respect to such interest, neither
the undersigned nor any of its direct or indirect partners/members is a bank
extending credit pursuant to a loan agreement entered into in the ordinary
course of its trade or business within the meaning of Section 881(c)(3)(A) of
the Code, (iv) none of its direct or indirect partners/members is a ten percent
shareholder of the applicable Seller(s) within the meaning of
Section 871(h)(3)(B) of the Code and (v) none of its direct or indirect
partners/members is a controlled foreign corporation related to the applicable
Seller(s) as described in Section 881(c)(3)(C) of the Code.

The undersigned has furnished the applicable Seller(s) with a correct, complete,
and accurate executed IRS Form W-8IMY accompanied by one of the following forms
from each of its partners/members that is claiming the portfolio interest
exemption: (i) an IRS Form W-8BEN or (ii) an IRS Form W-8IMY accompanied by an
IRS Form W-8BEN from each of such partner’s/member’s beneficial owners that is
claiming the portfolio interest exemption. By executing this certificate, the
undersigned agrees that (1) if the information provided on this certificate
changes, the undersigned shall promptly so inform the applicable Seller(s), and
(2) the undersigned shall have at all times furnished the applicable Seller(s)
with a properly completed and currently effective certificate in either the
calendar year in which each payment is to be made to the undersigned, or in
either of the two calendar years preceding such payments.

 

[NAME OF ASSIGNEE]

By:

 

 

 

Name:

 

Title:

Date:                     

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

EXHIBIT XII

UCC FILING JURISDICTIONS

Delaware

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

EXHIBIT XIII

FORM OF SERVICER NOTICE

[DATE]

[SERVICER]

[ADDRESS]

Attention:                     

 

  Re:

Master Repurchase Agreement, dated as of December 20, 2013 by and between
JPMorgan Chase Bank, National Association (“Buyer”) and Parlex 4 UK Finco, LLC
and Parlex 4 Finance, LLC (“Sellers”) (as amended, restated, supplemented, or
otherwise modified and in effect from time to time, the “Master Repurchase
Agreement”); (capitalized terms used but not otherwise defined herein shall have
the meanings assigned thereto in the Master Repurchase Agreement).

Ladies and Gentlemen:

[SERVICER] (the “Servicer”) is servicing certain mortgage assets sold by Seller
to Buyer pursuant to the Master Repurchase Agreement (the “Purchased Assets”)
pursuant to a servicing agreement dated as of December [    ], 2013 between
Servicer and Seller (the “Servicing Agreement”). Servicer is hereby notified
that, pursuant to the Master Repurchase Agreement, Seller has sold the Purchased
Assets to Buyer on a servicing-released basis, and has granted a security
interest to Buyer in the Purchased Assets.

In accordance with Seller’s requirements under the Master Repurchase Agreement,
Seller hereby notifies and instructs Servicer, and Servicer hereby agrees that
Servicer shall (a) segregate all amounts collected on account of the Purchased
Assets, (b) hold the Purchased Assets in trust for Buyer, (c) in accordance with
the terms of the Servicing Agreement, remit all such income to the Depository
Account at [PNC Bank, National Association], ABA # 043000096, Account #
[        ]. Upon receipt of a notice of Event of Default under the Master
Repurchase Agreement from Buyer, Servicer shall only follow the instructions of
Buyer with respect to the Purchased Assets, and shall deliver to Buyer any
information with respect to the Purchased Assets reasonably requested by Buyer.

Notwithstanding any contrary information or direction that may be delivered to
Servicer by Sellers, Servicer may conclusively rely on any information,
direction or notice of an Event of Default delivered by Buyer, and Sellers shall
indemnify and hold Servicer harmless for any and all claims asserted against
Servicer for any actions taken in good faith by Servicer in connection with the
delivery of such information or notice of Event of Default, absent a Seller’s
willful misconduct, gross negligence or fraud.

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

Servicer hereby agrees that, notwithstanding any provision to the contrary in
the Servicing Agreement or in any other agreement which exists between Servicer
and Seller in respect of any Purchased Asset, (i) Servicer is servicing the
Purchased Assets for the joint benefit of Seller and Buyer, (ii) Buyer is
expressly intended to be a third-party beneficiary under the Servicing
Agreement, (iii) Buyer has all rights with respect to the Purchased Asset and
the servicing thereof, and (iv) Buyer may terminate the Servicing Agreement and
any other such agreement immediately upon the delivery of written notice thereof
to Servicer and/or in any event transfer servicing to Buyer’s designee, at no
cost or expense to Buyer, it being agreed that Seller will pay any and all fees
required to terminate the Servicing Agreement and any other such agreement and
to effectuate the transfer of servicing to the designee of Buyer in accordance
with this Servicer Notice.

[Servicer hereby further acknowledges and agrees that (i) the Servicing
Agreement, together with Seller’s rights thereunder, has been assigned to Buyer
pursuant to the Master Repurchase Agreement, and Servicer consents to such
assignment, (ii) Buyer shall have no obligations, nor liability to Servicer,
under the Servicing Agreement (including, without limitation, any
indemnification of Servicer provided for in the Servicing Agreement),
(iii) Buyer shall have the right to consent to any proposed actions to be taken
with respect to the Purchased Assets, and (iv) Servicer shall not modify, amend
or terminate the Servicing Agreement without the prior written consent of
Buyer.]

No provision of this letter or any Servicing Agreement may be amended,
countermanded or otherwise modified without the prior written consent of Buyer.
Buyer is an intended third party beneficiary of this letter.

Please acknowledge receipt and your agreement to the terms of this instruction
letter by signing in the signature block below and forwarding an executed copy
to Buyer promptly upon receipt. Any notices to Buyer should be delivered to the
following address: JPMorgan Chase Bank, National Association, 4 New York Plaza,
20th Floor, New York, New York 10004, Attention: Ms. Nancy S Alto, Fax:
(917) 546-2564.

 

Very truly yours, JPMORGAN CHASE BANK, NATIONAL ASSOCIATION By:  

 

Name:   Title:  

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

ACKNOWLEDGED AND AGREED TO:   [                            ] By:  

 

Name:

  Title:  

 

[SERVICER] By:  

 

Name:

  Title:  

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

EXHIBIT XIV

FORM OF RELEASE LETTER

[Date]

JPMorgan Chase Bank, National Association

4 New York Plaza, 20th Floor

New York, New York 10004

Attention: Ms. Nancy S. Alto

 

  Re:

Master Repurchase Agreement, dated as of December 20, 2013 by and between
JPMorgan Chase Bank, National Association (“Buyer”) and Parlex 4 UK Finco, LLC
and Parlex 4 Finance, LLC (“Sellers”) (as amended, restated, supplemented, or
otherwise modified and in effect from time to time, the “Master Repurchase
Agreement”); (capitalized terms used but not otherwise defined herein shall have
the meanings assigned thereto in the Master Repurchase Agreement).

Ladies and Gentlemen:

With respect to the Purchased Assets described in the attached Schedule A (the
“Purchased Assets”) (a) we hereby certify to you that the Purchased Assets are
not subject to a lien of any third party, and (b) we hereby release all right,
interest or claim of any kind other than any rights under the Master Repurchase
Agreement with respect to such Purchased Assets, such release to be effective
automatically without further action by any party upon payment by Buyer of the
amount of the Purchase Price contemplated under the Master Repurchase Agreement
(calculated in accordance with the terms thereof) in accordance with the wiring
instructions set forth in the Master Repurchase Agreement.

 

Very truly yours, [                    ]

By:

 

 

Name:

 

Title:

 

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

Schedule A

[List of Purchased Asset Documents]

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

EXHIBIT XV

FORM OF COVENANT COMPLIANCE CERTIFICATE

[            ] [    ], 201[    ]

JPMorgan Chase Bank, National Association

270 Park Avenue, 7th Floor

New York, New York 10017-2014

Attention: Chuck Y. Lee

This Covenant Compliance Certificate is furnished pursuant to that certain
Master Repurchase Agreement, dated as of December 20, 2013 (as amended,
restated, supplemented, or otherwise modified and in effect from time to time,
the “Master Repurchase Agreement”) by and between JPMorgan Chase Bank, National
Association (“Buyer”) and Parlex 4 UK Finco, LLC and Parlex 4 Finance, LLC
(“Sellers”). Unless otherwise defined herein, capitalized terms used in this
Covenant Compliance Certificate have the respective meanings ascribed thereto in
the Master Repurchase Agreement.

THE UNDERSIGNED HEREBY CERTIFIES THAT:

 

  1.

I am a duly elected Responsible Officer of Sellers.

 

  2.

All of the financial statements, calculations and other information set forth in
this Covenant Compliance Certificate, including, without limitation, in any
exhibit or other attachment hereto, are true, complete and correct as of the
date hereof.

 

  3.

I have reviewed the terms of the Master Repurchase Agreement and I have made, or
have caused to be made under my supervision, a detailed review of the
transactions and financial condition of Sellers during the accounting period
covered by the financial statements attached (or most recently delivered to
Buyer if none are attached).

 

  4.

I am not aware of any facts, or pending developments that have caused, or may in
the future cause the Market Value of any Purchased Asset to decline at any time
within the reasonably foreseeable future.

 

  5.

As of the date hereof, and since the date of the certificate most recently
delivered pursuant to Article 11(j) of the Master Repurchase Agreement, Sellers
have observed or performed all of their respective covenants and other
agreements in all material respects, and satisfied in all material respects,
every condition, contained in the Master Repurchase Agreement and the related
documents to be observed, performed or satisfied by them.

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

  6.

The examinations described in Paragraph 3 above did not disclose, and I have no
knowledge of, the existence of any condition or event which constitutes an Event
of Default or Default during or at the end of the accounting period covered by
the attached financial statements or as of the date of this Covenant Compliance
Certificate (including after giving effect to any pending Transactions requested
to be entered into), except as set forth below.

 

  7.

As of the date hereof, each of the representations and warranties made by
Sellers in the Master Repurchase Agreement are true, correct and complete in all
material respects with the same force and effect as if made on and as of the
date hereof, except as to the extent of any exceptions approved by Buyer in
writing.

 

  8.

No condition or event that constitutes a “Termination Event”, “Event of
Default”, “Potential Event of Default” or any similar event by Seller, however
denominated, has occurred or is continuing under any Hedging Transaction.

 

  9.

Attached as Exhibit 2 hereto is a description of all interests of Affiliates of
Sellers in any Underlying Mortgaged Property (including without limitation, any
lien, encumbrance or other debt or equity position or other interest in the
Underlying Mortgaged Property that is senior or junior to, or pari passu with, a
Purchased Asset in right of payment or priority).

 

  10.

Attached as Exhibit 3 hereto are the financial statements required to be
delivered pursuant to Article 11 of the Master Repurchase Agreement (or, if none
are required to be delivered as of the date of this Covenant Compliance
Certificate, the financial statements most recently delivered pursuant to
Article 11 of the Master Repurchase Agreement), which financial statements, to
the best of my knowledge after due inquiry, fairly and accurately present in all
material respects, the financial condition and operations of Sellers as of the
date or with respect to the period therein specified, determined in accordance
with the requirements set forth in Article 11.

 

  11.

Attached as Exhibit 4 hereto are the calculations demonstrating compliance with
the financial covenants set forth in Article 11 of the Master Repurchase
Agreement.

To the extent that financial statements are being delivered in connection with
this Covenant Compliance Certificate, each Seller hereby makes the following
representations and warranties: (i) it is in compliance with all of the terms
and conditions of the Master Repurchase Agreement and (ii) it has no claim or
offset against Buyer under the Transaction Documents.

To the best of my knowledge, each Seller has, during the period since the
delivery of the immediately preceding Covenant Compliance Certificate, observed
or performed all of its respective covenants and other agreements in all
material respects, and satisfied in all material respects every condition,
contained in the Master Repurchase Agreement and the related documents to be
observed, performed or satisfied by it, and I have no knowledge of the
occurrence during such period, or present existence, of any condition or event
which constitutes an Event of Default or Default (including after giving effect
to any pending Transactions requested to be entered into), except as set forth
below.

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

Described below are the exceptions, if any, to paragraph 10, listing, in detail,
the nature of the condition or event, the period during which it has existed and
the action which Guarantor or a Seller has taken, is taking, or proposes to take
with respect to each such condition or event:

 

 

     

 

     

 

     

 

     

The foregoing certifications, together with the financial statements, updates,
reports, materials, calculations and other information set forth in any exhibit
or other attachment hereto, or otherwise covered by this Covenant Compliance
Certificate, are made and delivered this [            ] day of [    ],
201[    ].

 

 

Name: Title:

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

EXHIBIT XVI

FORM OF RE-DIRECTION LETTER

[SELLER LETTERHEAD]

RE-DIRECTION LETTER

AS OF [    ]

Ladies and Gentlemen:

Please refer to: (a) that certain [Loan Agreement], dated [            ]
[        ], 201[        ], by and between [            ] (the “Mortgagor”), as
borrower, and [            ] (the “Lender”), as lender; and (b) all documents
securing or relating to that certain $[            ] loan made by Lender to
Mortgagor on [            ] [        ], 201[        ] (the “Loan”).

You are advised as follows, effective as of the date of this letter.

Assignment of the Loan. Lender has entered into a Master Repurchase Agreement,
dated as of December 20, 2013 (as the same may be amended and/or restated from
time to time, the “Repurchase Agreement”), with JPMorgan Chase Bank, National
Association (“JPMorgan”), 270 Park Avenue, 10th Floor, New York, New York 10017,
and has assigned its rights and interests in the Loan (and all of its rights and
remedies in respect of the Loan) to JPMorgan, subject to the terms of the
Repurchase Agreement. This assignment shall remain in effect unless and until
JPMorgan has notified the Mortgagor otherwise in writing.

Direction of Funds. In connection with Lender’s obligations under the Repurchase
Agreement, Lender hereby directs Mortgagor to disburse, by wire transfer, any
and all payments to be made under or in respect of the Loan to the following
account, for the benefit of JPMorgan:

ABA # 121000248

Account # [            ]

Attn: [Insert information regarding Depository Account]

Acct Name: “Midland Loan Services, a Division of PNC Bank, National Association
on

behalf of [                            ] for the benefit of JPMorgan Chase Bank,
National

Association, as Repurchase Agreement Buyer”

This direction shall remain in effect unless and until JPMorgan has notified
Mortgagor otherwise in writing.

Modifications, Waivers, Etc. No modification, waiver, deferral, or release (in
whole or in part) of any party’s obligations in respect of the Loan, or of any
collateral for any obligations in respect of the Loan, shall be effective
without the prior written consent of JPMorgan. Notwithstanding the foregoing,
neither Seller nor Servicer shall take any action or effect any modification or
amendment to any Purchased Asset without first having given prior notice thereof
to Buyer in each such instance and receiving the express prior written consent
of Buyer, if such notice and consent is required by the Repurchase Agreement.

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

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.

 

Very truly yours,

 

[                                 ],

a Delaware limited liability company

By:

 

 

Name:  

 

Title:  

 

Date:  

[            ] [    ], 201[    ]

 

Agreed and accepted this [    ]

day of [            ], 201[    ]

By:    

Name:

 

 

Title:

 

 

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

EXHIBIT XVII

FORM OF SERVICING AGREEMENT FOR FOREIGN PURCHASED ASSETS