Exhibit 10.2

GUARANTY AGREEMENT
THIS GUARANTY AGREEMENT, dated as of June 27, 2019 (as amended, restated,
supplemented, or otherwise modified from time to time, this “Guaranty”), made by
KKR REAL ESTATE FINANCE HOLDINGS L.P., a Delaware limited partnership
(“Guarantor”), in favor of MORGAN STANLEY MORTGAGE CAPITAL HOLDINGS LLC, as
administrative agent (“Administrative Agent”) for the benefit of MORGAN STANLEY
BANK, N.A., as buyer (together with its permitted successors and assigns,
individually or collectively as the context may require, “Buyer”). Any
capitalized term utilized herein shall have the meaning as specified in the
Repurchase Agreement (as defined below), unless such term is otherwise
specifically defined herein.
W I T N E S S E T H :
WHEREAS, Administrative Agent, Buyer and KREF Lending V LLC, a Delaware limited
liability company (“Seller”), entered into that certain Master Repurchase and
Securities Contract Agreement dated as of the date hereof (as the same may be
amended, modified and/or restated, the “Repurchase Agreement”);
WHEREAS, Guarantor directly or indirectly owns 100% of the membership interests
in Seller, and Guarantor will derive benefits, directly and indirectly, from the
execution, delivery and performance by Seller of the Transaction Documents and
the transactions contemplated by the Repurchase Agreement; and
WHEREAS, it is a condition precedent to the Repurchase Agreement and the
consummation of the Transactions thereunder that Guarantor execute and deliver
this Guaranty to Administrative Agent for the benefit of Buyer.
NOW, THEREFORE, for good and valuable consideration, the receipt and legal
sufficiency of which are hereby acknowledged, Guarantor does hereby agree as
follows:
Article I

NATURE AND SCOPE OF GUARANTY
1.1    Guaranty of Obligations. Subject to the terms hereof, Guarantor hereby
irrevocably and unconditionally guarantees to Administrative Agent, for the
benefit of the Buyer, and its permitted successors and assigns as a primary
obligor the payment and performance of the Guaranteed Obligations (as herein
defined) as and when the same shall be due and payable.
1.2    Definition of Guaranteed Obligations. As used herein, the term
“Guaranteed Obligations” means:
(a)    the prompt and complete payment of the Repurchase Obligations; provided,
however, the aggregate sum of the Guaranteed Obligations paid by Guarantor under
this Section 1.2(a) shall not exceed an amount equal to 25% of the then
aggregate Repurchase Price under the Repurchase Agreement; provided, further,
that notwithstanding the foregoing or anything to the contrary herein, if
Administrative Agent asserts that an Event of Default has occurred and is
continuing then, upon payment by Guarantor to Administrative Agent of an amount
equal to 25% of the then aggregate Repurchase Price accompanied by written
confirmation from Guarantor and Seller agreeing that upon delivery of such
payment to Administrative Agent, all Transactions shall be terminated and there
shall thereafter be no further Transactions under the Repurchase Agreement,
Guarantor shall have no further liability or obligation under this Section
1.2(a);
(b)    any actual loss, damage, cost or expense incurred by Administrative Agent
(including attorneys’ fees and costs reasonably incurred) resulting from any of
the following:
(1) any fraud or intentional misrepresentation committed by Seller, Pledgor,
Guarantor or any Affiliate of Seller, Pledgor or Guarantor in connection with
the execution and delivery of this Guaranty, the Repurchase Agreement, the
Pledge and Security Agreement or any of the other Transaction Documents, or any
certificate, report, financial statement or other instrument or document
furnished to Administrative Agent at the time of the closing of the Repurchase
Agreement or during the term of the Repurchase Agreement;
(1) the misappropriation by Seller, Pledgor, Guarantor or any Affiliate of
Seller, Pledgor or Guarantor of any funds related to the Purchased Assets and
not applied in accordance with the Repurchase Agreement;
(1) (1) the creation or incurrence of any lien by Seller, Pledgor, Guarantor or
any Affiliate of Seller, Pledgor or Guarantor on (1) any Purchased Asset unless
permitted under the Repurchase Agreement or (2) any “Collateral” (as defined in
the Pledge and Security Agreement) (the “Pledge Collateral”) unless permitted
under the Pledge and Security Agreement, (1) any Change of Control prohibited by
the Repurchase Agreement, (1) any transfer, assignment or sale of (1) any
Purchased Asset in violation of the Repurchase Agreement or (2) any Pledge
Collateral in violation of the Pledge and Security Agreement, (D) any
Significant Modification to a Purchased Asset that is intentionally effectuated
by Seller or its Affiliate in violation of the provisions of the Repurchase
Agreement or (E) the material breach of any material separateness covenants
contained in the Repurchase Agreement;
(1) during the continuance of an Event of Default, any distribution by Seller to
its equityholders in violation of the Repurchase Agreement and, in the case of
such a violation, only to the extent of such distribution; or
(1) any breach by Guarantor of Sections 4.4, 4.6 or 4.10 of this Guaranty; and
(c)    any and all Repurchase Obligations in the event that Seller makes a
voluntary filing under the Bankruptcy Code or similar federal or state law, or
Seller, Guarantor or any Affiliate of Seller or Guarantor joins or colludes in
the filing of an involuntary filing against Seller under the Bankruptcy Code or
other similar federal or state law.
For the avoidance of doubt, Guarantor shall not have any liability to
Administrative Agent under this Guaranty other than for the Guaranteed
Obligations.
1.3    Nature of Guaranty. This Guaranty is an irrevocable, absolute, continuing
guarantee of payment and performance and not a guaranty of collection. This
Guaranty may not be revoked by Guarantor and shall continue to be effective with
respect to any Guaranteed Obligations arising or created after any attempted
revocation by Guarantor. This Guaranty may be enforced by Administrative Agent
and any subsequent assignee of Administrative Agent under the Repurchase
Agreement and shall not be discharged by the assignment or negotiation of all or
part thereof.
1.4    Guaranteed Obligations Not Reduced by Offset. The Guaranteed Obligations
and the liabilities and obligations of Guarantor to Administrative Agent
hereunder shall not be reduced, discharged or released because or by reason of
any existing or future offset, claim or defense of Seller, or any other party,
against Administrative Agent or against payment of the Guaranteed Obligations,
other than payment of the Guaranteed Obligations, whether such offset, claim or
defense arises in connection with the Guaranteed Obligations (or the
transactions creating the Guaranteed Obligations) or otherwise.
1.5    Payment by Guarantor. If all or any part of the Guaranteed Obligations
shall not be punctually paid, whether on demand, maturity, acceleration or
otherwise, Guarantor shall, within ten (10) Business Days after demand by
Administrative Agent, and without presentment, protest, notice of protest,
notice of non-payment, notice of intention to accelerate the maturity, notice of
acceleration of the maturity, or any other notice whatsoever, pay in lawful
money of the United States of America, the amount then due on the Guaranteed
Obligations to Administrative Agent at Administrative Agent’s address as set
forth herein. Such demand(s) may be made at any time coincident with or after
the time for payment of all or any part of the Guaranteed Obligations pursuant
to the Repurchase Agreement. Such demand shall be deemed made, given and
received in accordance with Section 6.2 hereof.
1.6    No Duty to Pursue Others. It shall not be necessary for Administrative
Agent (and Guarantor hereby waives any rights which Guarantor may have to
require Administrative Agent) in order to enforce the obligations of Guarantor
hereunder, to (a) institute suit or exhaust its remedies against Seller or
others liable on the Guaranteed Obligations, (a) enforce or exhaust
Administrative Agent’s rights against any collateral which shall ever have been
given to secure the Guaranteed Obligations (a) join Seller or any others liable
on the Guaranteed Obligations in any action seeking to enforce this Guaranty, or
(a) resort to any other means of obtaining payment of the Guaranteed
Obligations, and Administrative Agent shall not be required to mitigate damages
or take any other action to collect or enforce the Guaranteed Obligations.
1.7    Waivers. Guarantor agrees to the provisions of the Transaction Documents,
and hereby waives notice of (1) any loans or advances made by Buyer to Seller or
any purchases of Purchased Assets made by Buyer, from Seller, (1) acceptance of
this Guaranty, (1) any amendment or extension of the Repurchase Agreement or of
any other Transaction Documents, (1) the execution and delivery by Seller,
Administrative Agent and Buyer of any other agreement or of Seller’s execution
and delivery of any other documents arising under the Transaction Documents or
in connection with the Guaranteed Obligations, (1) the occurrence of any breach
by Seller or an Event of Default under the Transaction Documents, (1)
Administrative Agent’s or Buyer’s transfer or disposition of the Transaction
Documents, or any part thereof, (1) sale or foreclosure (or posting or
advertising for sale or foreclosure) of any collateral for the Guaranteed
Obligations, (1) protest, proof of non-payment or default by Seller, or (1) any
other action at any time taken or omitted by Administrative Agent, and,
generally, except to the extent required by the terms hereof, all other demands
and notices of every kind in connection with this Guaranty, the Transaction
Documents, any documents or agreements evidencing, securing or relating to all
or any part of the Guaranteed Obligations.
1.8    Payment of Expenses. In the event that Guarantor should breach or fail to
timely perform any provisions of this Guaranty, Guarantor shall, within five (5)
Business Days after demand by Administrative Agent, pay Administrative Agent all
reasonable out-of-pocket costs and expenses (including court costs and
reasonable attorneys’ fees) incurred by Administrative Agent in the enforcement
hereof or the preservation of Administrative Agent’s rights hereunder. The
covenant contained in this Section 1.8 shall survive the payment and performance
of the Guaranteed Obligations.
1.9    Effect of Bankruptcy. In the event that, pursuant to any insolvency,
bankruptcy, reorganization, receivership or other debtor relief law, or any
judgment, order or decision thereunder, Administrative Agent must rescind or
restore any payment, or any part thereof, received by Administrative Agent in
satisfaction of the Guaranteed Obligations, as set forth herein, any prior
release or discharge from the terms of this Guaranty given to Guarantor by
Administrative Agent shall be without effect, and this Guaranty shall remain in
full force and effect. It is the intention of Seller and Guarantor that
Guarantor’s obligations hereunder shall not be discharged except by Seller’s or
Guarantor’s payment and performance of the Guaranteed Obligations which is not
so rescinded or Guarantor’s performance of such obligations and then only to the
extent of such performance.
1.10    Deferral of Subrogation, Reimbursement and Contribution. Notwithstanding
anything to the contrary contained in this Guaranty, Guarantor hereby
unconditionally and irrevocably defers until payment in full of the Guaranteed
Obligations any and all rights it may now or hereafter have under any agreement,
at law or in equity (including, without limitation, any law subrogating
Guarantor to the rights of Administrative Agent), to assert any claim against or
seek contribution, indemnification or any other form of reimbursement from
Seller or any other party liable for payment of all or any part of the
Guaranteed Obligations for any payment made by Guarantor under or in connection
with this Guaranty.
1.11    Setoff Rights. Without limiting any other rights or remedies of
Administrative Agent, Administrative Agent shall have the right, without prior
notice to Guarantor, and any such notice being expressly waived by Guarantor to
the extent permitted by applicable law, to set off and appropriate and apply any
and all deposits (general or special, time or demand, provisional or final) in
any currency, and any other obligation (including to return excess margin),
credits, indebtedness, claims, securities, collateral or other property, in any
currency, in each case whether direct or indirect, absolute or contingent,
matured or unmatured, at any time held or owing by or due from Administrative
Agent or any Affiliate of Administrative Agent to or for the credit of the
account of Seller or Guarantor to any obligations of Guarantor hereunder to
Administrative Agent. This Section 1.11 shall be without prejudice and in
addition to any right of set-off, combination of accounts, lien or other rights
to which any party is at any time otherwise entitled (whether by operation of
law, contract or otherwise).
1.12    Seller. The term “Seller” as used herein shall include any new or
successor corporation, limited liability company, association, partnership
(general or limited), joint venture, trust or other individual or organization
formed as a result of any merger, reorganization, sale, transfer, devise, gift
or bequest of Seller or any interest in Seller.
ARTICLE II    

EVENTS AND CIRCUMSTANCES NOT REDUCING
OR DISCHARGING GUARANTOR’S OBLIGATIONS
Guarantor hereby consents and agrees to each of the following, and agrees with
Administrative Agent that its obligations under this Guaranty shall not be
released, diminished, impaired, reduced or adversely affected by any of the
following, except to the extent required by the terms hereof, and waives any
common law, equitable, statutory or other rights (including without limitation,
except to the extent required by the terms of this Guaranty, rights to notice)
which Guarantor might otherwise have as a result of or in connection with any of
the following:
2.1    Modifications. Any renewal, extension, increase, modification, alteration
or rearrangement of all or any part of the Repurchase Agreement, the other
Transaction Documents or any other document, instrument, contract or
understanding between Seller and Administrative Agent or Buyer or any other
party pertaining to the Guaranteed Obligations or any failure of Administrative
Agent or Buyer to notify Guarantor of any such action.
2.2    Adjustment. Any adjustment, indulgence, forbearance or compromise that
might be granted or given by Administrative Agent to Seller.
2.3    Condition of Seller or Guarantor. The insolvency, bankruptcy,
arrangement, adjustment, composition, liquidation, disability, dissolution or
lack of power of Seller, Guarantor or any other party at any time liable for (1)
the payment of all or any part of the Guaranteed Obligations (1) any dissolution
of Seller or Guarantor, (1) any sale, lease or transfer of any or all of the
assets of Seller or Guarantor, (1) any changes in the shareholders, partners or
members of Seller or Guarantor; or (1) any reorganization of Seller or
Guarantor.
2.4    Invalidity of Guaranteed Obligations. The invalidity, illegality or
unenforceability against Seller of all or any part of the Repurchase Agreement
or any document or agreement executed in connection with the Guaranteed
Obligations, for any reason whatsoever, including, without limitation, the fact
that (1) the act of creating the Guaranteed Obligations or any part thereof is
ultra vires, (1) the officers or representatives executing the Repurchase
Agreement or the other Transaction Documents or otherwise creating the
Guaranteed Obligations acted in excess of their authority, (1) Seller has valid
defenses (other than payment of the Guaranteed Obligations), claims or offsets
(whether at law, in equity or by agreement) which render the Guaranteed
Obligations wholly or partially uncollectible from Seller, (1) the creation,
performance or repayment of the Guaranteed Obligations (or the execution,
delivery and performance of any document or instrument representing part of the
Guaranteed Obligations or executed in connection with the Guaranteed
Obligations, or given to secure the repayment of the Guaranteed Obligations) is
illegal, uncollectible or unenforceable, or (1) the Repurchase Agreement, or any
of the other Transaction Documents have been forged or otherwise are irregular
or not genuine or authentic, it being agreed that Guarantor shall remain liable
hereon regardless of whether Seller or any other person be found not liable on
the Guaranteed Obligations, or any part thereof, for any reason.
2.5    Release of Obligors. Any full or partial release of the liability of
Seller on the Guaranteed Obligations, or any part thereof, or of any
co-guarantors, or any other person or entity now or hereafter liable, whether
directly or indirectly, jointly, severally, or jointly and severally, to pay,
perform, guarantee or assure the payment of the Guaranteed Obligations, or any
part thereof; it being recognized, acknowledged and agreed by Guarantor that
Guarantor may be required to pay the Guaranteed Obligations in full without
assistance or support of any other party, and Guarantor has not been induced to
enter into this Guaranty on the basis of a contemplation, belief, understanding
or agreement, as between Administrative Agent, Buyer and Guarantor, that other
parties will be liable to pay or perform the Guaranteed Obligations, or that
Administrative Agent will look to other parties to pay or perform the
obligations of Seller under the Repurchase Agreement or the other Transaction
Documents.
2.6    Other Collateral. The taking or accepting of any other security,
collateral or guarantee, or other assurance of payment, for all or any part of
the Guaranteed Obligations.
2.7    Release of Collateral. Any release, surrender, exchange, subordination,
deterioration, waste, loss or impairment (including without limitation
negligent, willful, unreasonable or unjustifiable impairment) by any party other
than Administrative Agent or Buyer of any collateral, property or security at
any time existing in connection with, or assuring or securing payment of, all or
any part of the Guaranteed Obligations.
2.8    Care and Diligence. The failure of Administrative Agent, Buyer or any
other party to exercise diligence or reasonable care in the preservation,
protection, enforcement, sale or other handling or treatment of any collateral,
property or security assuring or securing payment of the Guaranteed Obligations,
including, but not limited to, the neglect, delay, omission, failure or refusal
of Administrative Agent to (1) take or prosecute any action for the collection
of the Guaranteed Obligations or any part thereof, (1) foreclose, initiate any
action to foreclose or, once commenced, prosecute to completion any action to
foreclose upon any such collateral, property or security or (1) take or
prosecute any action in connection with any instrument or agreement evidencing
or securing all or any part of the Guaranteed Obligations.
2.9    Unenforceability. The fact that any collateral, security, security
interest or lien contemplated or intended to be given, created or granted as
security for the repayment of the Guaranteed Obligations, or any part thereof,
shall not be properly perfected or created, or shall prove to be unenforceable
or subordinate to any other security interest or lien, it being recognized and
agreed by Guarantor that it is not entering into this Guaranty in reliance on,
or in contemplation of the benefits of, the validity, enforceability,
collectability or value of any of the collateral for the Guaranteed Obligations.
2.10    Merger. The reorganization, merger or consolidation of Seller into or
with any other corporation or entity.
2.11    Preference. Any payment by Seller to Administrative Agent is held to
constitute a preference under bankruptcy laws, or for any reason Administrative
is required to refund such payment or pay such amount to Seller or someone else.
2.12    Other Actions Taken or Omitted. Except to the extent the same shall
result from the gross negligence, willful misconduct, bad faith, illegal acts or
fraud of Administrative Agent or Buyer, any other action taken or omitted to be
taken with respect to the Transaction Documents, the Guaranteed Obligations, or
the security and collateral therefor, whether or not such action or omission
prejudices Guarantor or increases the likelihood that Guarantor will be required
to pay the Guaranteed Obligations pursuant to the terms hereof, it is the
unambiguous and unequivocal intention of Guarantor that Guarantor shall be
obligated to pay the Guaranteed Obligations when due, notwithstanding any
occurrence, circumstance, event, action, or omission whatsoever, whether
contemplated or uncontemplated, and whether or not otherwise or particularly
described herein, which obligation shall be deemed satisfied only upon the full
and final payment and satisfaction of the Guaranteed Obligations.
ARTICLE III    

REPRESENTATIONS AND WARRANTIES
To induce Administrative Agent and Buyer to enter into the Transaction
Documents, Guarantor represents and warrants to Administrative Agent for the
benefit of Buyer as of the date hereof and at all times while the Repurchase
Agreement and any Transaction thereunder is in effect as follows:
3.1    Benefit. Guarantor has received, or will receive, indirect benefit from
the execution, delivery and performance by Seller of the Transaction Documents,
and the transactions contemplated therein.
3.2    Familiarity and Reliance. Guarantor is familiar with, and has
independently reviewed books and records regarding, the financial condition of
Seller and is familiar with the value of any and all collateral intended to be
pledged as security for the payment of the Guaranteed Obligations; provided,
however, that, as between Administrative Agent, Buyer and Guarantor, Guarantor
is not relying on such financial condition or the collateral as an inducement to
enter into this Guaranty.
3.3    No Representation By Administrative Agent or Buyer. None of
Administrative Agent, Buyer or any other party on Buyer’s behalf has made any
representation, warranty or statement to Guarantor in order to induce Guarantor
to execute this Guaranty.
3.4    Guarantor’s Financial Condition. As of the date hereof, and after giving
effect to this Guaranty and the contingent obligation evidenced hereby,
Guarantor is and will be solvent, and has and will have assets which, fairly
valued, exceed its obligations, liabilities (including contingent liabilities
fairly estimated) and debts, and has and will have property and assets
sufficient to satisfy and repay its obligations and liabilities, as and when the
same become due.
3.5    Legality. The execution, delivery and performance by Guarantor of this
Guaranty and the consummation of the transactions contemplated hereunder do not,
and will not, contravene or conflict with any law, statute or regulation
whatsoever to which Guarantor is subject or constitute a default (or an event
which with notice or lapse of time or both would constitute a default) under, or
result in the breach of, any material indenture, mortgage, deed of trust,
charge, lien, or any material contract, agreement or other instrument to which
Guarantor is a party or which may be applicable to Guarantor. This Guaranty is a
legal and binding obligation of Guarantor and is enforceable in accordance with
its terms, except as limited by bankruptcy, insolvency or other laws of general
application relating to the enforcement of creditors’ rights and subject, as to
enforceability, to general principals of equity, regardless whether enforcement
is sought in a proceeding in equity or at law.
3.6    Survival. All representations and warranties made by Guarantor herein
shall survive until payment in full of the Guaranteed Obligations.
3.7    Organization. Guarantor has been duly organized or formed and is validly
existing and in good standing with requisite limited partnership power and
authority to own its properties and to transact the businesses in which it is
now engaged. Guarantor is duly qualified to do business and is in good standing
in each jurisdiction where it is required to be so qualified in connection with
its properties, businesses and operations except where the failure to do same
would not reasonably be expected to have a material adverse effect thereon.
Guarantor possesses all rights, licenses, permits and authorizations,
governmental or otherwise, necessary to entitle it to own its properties and to
transact the businesses in which it is now engaged, except where the failure to
do same would not reasonably be expected to have a material adverse effect
thereon.
3.8    No Investment Company. Guarantor is not an “investment company”, or a
company “controlled by an investment company”, within the meaning of the
Investment Company Act of 1940, as amended.
3.9    Tax Returns. Except as disclosed in writing to Administrative Agent prior
to the date hereof, Guarantor has filed or caused to be filed all income and
other material tax returns which, to the knowledge of Guarantor, are required to
be filed and has paid all income and other material taxes shown to be due and
payable on said returns or on any assessments made against Guarantor or any of
the property of Guarantor and all other income and material taxes, fees or other
charges imposed on him or any of the property of Guarantor by any Governmental
Authority (other than any the amount or validity of which are currently being
contested in good faith by appropriate proceedings); no tax lien has been filed,
and, to the knowledge of Guarantor, no claim is being asserted, with respect to
any such tax, fee or other charge.
3.10    Litigation. No litigation, investigation or proceeding of or before any
arbitrator or Governmental Authority is pending or, to the knowledge of
Guarantor, threatened by or against Guarantor or against any of the properties
or revenues of Guarantor with respect to this Guaranty or any of the
transactions contemplated hereby that is reasonably likely to have a Material
Adverse Effect.
3.11    Insider. As of the date hereof, Guarantor 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 or
Administrative Agent, of a bank holding company of which Buyer or Administrative
Agent is a Subsidiary, or of any Subsidiary of a bank holding company of which
Buyer or Administrative Agent is a Subsidiary, of any bank at which Buyer or
Administrative Agent maintains a correspondent account or of any lender which
maintains a correspondent account with Buyer or Administrative Agent.
ARTICLE IV    

COVENANTS OF GUARANTOR
Guarantor covenants to, and agrees that, until payment in full of all Guaranteed
Obligations:
4.1    Financial Statements, Reports, etc. Guarantor shall deliver (or cause to
be delivered) to Administrative Agent:
(a)    as soon as available and in any event within forty-five (45) days after
the end of each of the first three quarterly fiscal periods of each fiscal year
of Guarantor, the unaudited balance sheet and income statement of Guarantor,
which shall incorporate its consolidated Subsidiaries (including Pledgor and
Seller), as at the end of such period, setting forth in each case in comparative
form the figures for the previous year, accompanied by an Officer’s Certificate
of Guarantor, which certificate shall state that said consolidated financial
statements fairly present the consolidated financial condition and results of
operations of Guarantor and its consolidated Subsidiaries in accordance with
GAAP, consistently applied, as at the end of, and for, such period (subject to
normal year-end audit adjustments) (collectively, the “Quarterly Report”);
(b)    as soon as available and in any event within one hundred twenty (120)
days after the end of each fiscal year of Guarantor:
(i)    the unaudited, balance sheet and income statement of Guarantor, which
shall incorporate its consolidated Subsidiaries as at the end of such fiscal
year, accompanied by an Officer’s Certificate of Guarantor, which certificate
shall state that said consolidated financial statements fairly present the
consolidated financial condition and results of operations of Guarantor and its
consolidated Subsidiaries in accordance with GAAP, consistently applied, as at
the end of, and for, such period (collectively, “Guarantor Annual Reporting”);
(ii)    the combined, consolidated balance sheet and statement of equity of
REIT, which shall incorporate its consolidated Subsidiaries, as at the end of
such fiscal year and the related combined, consolidated statements of operations
and of cash flows for REIT, which shall incorporate its consolidated
Subsidiaries, for such year, accompanied by an opinion thereon of Deloitte
Consulting LLP or other independent certified public accountants of recognized
national standing, which opinion shall not be qualified as to scope of audit or
going concern and shall state that said combined, consolidated financial
statements fairly present the combined, consolidated financial condition and
results of operations of REIT and its consolidated Subsidiaries as at the end
of, and for, such fiscal year in accordance with GAAP (collectively, “REIT
Annual Reporting”, and together with Guarantor Annual Reporting, the “Annual
Reporting Package”);
4.2    Litigation. Guarantor will promptly, and in any event within ten (10)
days after service of process on any of the following, give to Administrative
Agent notice of all litigation, actions, suits, arbitrations, investigations
(including, without limitation, any of the foregoing which are pending or
threatened) or other legal or arbitrable proceedings affecting Guarantor or any
of its Subsidiaries before any Governmental Authority that (1) questions or
challenges the validity or enforceability of this Guaranty or any action to be
taken in connection with the transactions contemplated hereby, (1) makes a claim
or claims against Guarantor in an aggregate amount greater than $20,000,000 or
(1) which, individually or in the aggregate, if adversely determined could be
reasonably likely to have a Material Adverse Effect.
4.3    Existence, etc. Pursuant to the Transaction Documents, Guarantor will (1)
preserve and maintain its legal existence and all of its material rights,
privileges, licenses and franchises; (1) comply in all material respects with
the requirements of applicable laws, rules, regulations and orders of
Governmental Authorities (including, without limitation, all environmental
laws); (1) keep adequate records and books of account, in which complete entries
will be made in accordance with GAAP consistently applied; (1) not change its
jurisdiction of organization unless it shall have provided Administrative Agent
at least ten (10) days’ prior written notice of such change; and (1) pay and
discharge all income and other material taxes, assessments and governmental
charges or levies 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 tax, assessment, charge or levy the payment of which is being contested in
good faith and by proper proceedings and against which adequate reserves are
being maintained.
4.4    Prohibition of Fundamental Changes. Except as permitted pursuant to the
terms of the Transaction Documents, Guarantor shall not enter into any
transaction that would be a Change of Control, or liquidate, wind up or dissolve
itself (or suffer any liquidation, winding up or dissolution) or sell all or
substantially all of its assets.
4.5    [Reserved].
4.6    [Reserved].
4.7    Financial Covenants. (a) Guarantor (including its consolidated
Subsidiaries) covenants and agrees that it shall not:
(i)    permit the ratio of (A) Interest Income (excluding deferred interest and
the amortized portion of any upfront fees) for the period of four (4)
consecutive fiscal quarters ended on or most recently prior to such date of
determination to (B) the Interest Expense to be less than 1.50 to 1.00, as
determined as soon as practicable after the end of such period, but in no event
later than forty-five (45) days after the last day of such period;
(ii)    permit the Tangible Net Worth of Guarantor to be less than the sum of
(i) $880,208,000 plus (ii) 75% of the aggregate net cash proceeds of any equity
issuances made and any capital contributions received by Guarantor after the
date hereof;
(iii)    permit the Cash Liquidity of Guarantor to be less than the greater of
(x) $10,000,000 and (B) 5.0% of the recourse Indebtedness of Guarantor; or
(iv)    permit the ratio of Total Indebtedness of Guarantor and its consolidated
Subsidiaries to Total Assets of Guarantor and its consolidated Subsidiaries to
be greater than 75%.
(b)    Guarantor shall, within forty-five (45) days of the end of each of the
first three (3) fiscal quarters, and within ninety (90) days after the last day
of the fiscal year, deliver to Administrative Agent a Financial Covenant
Compliance Certificate setting forth the calculation of each of the financial
covenants set forth in Section 4.7(i) above.

(c)    The following terms shall having the meanings ascribed below for purposes
of this Guaranty:

(i)    “Cash” shall mean coin or currency of the United States of America or
immediately available federal funds, including such funds delivered by wire
transfer.

(ii)    “Cash Equivalents” shall mean any of the following, to the extent owned
by Guarantor or any of its Subsidiaries free and clear of all Liens and having a
maturity of not greater than 90 days from the date of issuance thereof: (a)
readily marketable direct obligations of the government of the United States or
any agency or instrumentality thereof or obligations unconditionally guaranteed
by the full faith and credit of the government of the United States or (b)
certificates of deposit of or time deposits with Administrative Agent, Buyer or
a member of the Federal Reserve System that issues (or the parent of which
issues) commercial paper rated as described in clause (c) below, is organized
under the laws of the United States or any state thereof and has combined
capital and surplus of at least $1,000,000,000 or (c) commercial paper in an
aggregate amount of not more than $50,000,000 per issuer outstanding at any
time, issued by any corporation organized under the laws of any state of the
United States and rated at least “Prime-1” (or the then equivalent grade) by
Moody’s or “A-1” (or the then equivalent grade) by S&P.

(iii)    “Cash Liquidity” shall mean, at any date of determination, the sum of
unrestricted Cash plus Cash Equivalents.

(iv)    “Total Assets” means, with respect to any Person, on any date of
determination, an amount equal to the aggregate book value of all assets owned
by such Person and its Consolidated Subsidiaries and the proportionate share of
such Person of all assets owned by Affiliates of such Person as consolidated in
accordance with GAAP, less (a) amounts owing to such Person and its Consolidated
Subsidiaries from any Affiliate thereof, or from officers, employees, partners,
members, directors, shareholders or other Persons similarly affiliated with such
Person or any Affiliate thereof, (b) Intangible Assets, and (c) prepaid taxes
and expenses, all on or as of such date, and (d) the amount of non-recourse
Indebtedness owing pursuant to securitization transactions that are not issued
or sponsored by Guarantor, Affiliates of Guarantor and/or Affiliates of Manager
(e.g. commercial real estate CLOs (including, without limitation, any CMBS
investments)) that result from the consolidation of “variable interest entities”
under the requirements of the Accounting Standards Codification Section 810, as
amended, modified or supplemented from time to time, and (e) the amount of any
non-recourse Indebtedness owing pursuant to a financing or securitization
transaction such as a REMIC securitization, a collateralized loan obligation
transaction or any other similar transaction.

4.8    [Reserved].
4.9    Offset. The liabilities and obligations of Guarantor to Administrative
Agent hereunder shall not be reduced, discharged or released because of or by
reason of any existing or future right of offset, claim or defense (other than
payment of the Guaranteed Obligations) of Seller against Administrative Agent,
or any other party, or against payment of the Guaranteed Obligations, whether
such right of offset, claim or defense arises in connection with the Guaranteed
Obligations (or the transactions creating the Guaranteed Obligations).
4.10    [Reserved].
ARTICLE V    

SUBORDINATION OF CERTAIN INDEBTEDNESS
5.1    Subordination of All Guarantor Claims. As used herein, the term
“Guarantor Claims” shall mean all debts and liabilities of Seller to Guarantor
arising as the consequence of this Guaranty or the payment or other performance
by Guarantor hereunder, whether such debts and liabilities now exist or are
hereafter incurred or arise, or whether the obligations of Seller thereon be
direct, contingent, primary, secondary, several, joint and several, or
otherwise, and irrespective of whether such debts or liabilities be evidenced by
note, contract, open account, or otherwise, and irrespective of the person or
persons in whose favor such debts or liabilities may, at their inception, have
been, or may hereafter be created, or the manner in which they have been or may
hereafter be acquired by Guarantor. The Guarantor Claims shall include without
limitation all rights and claims of Guarantor against Seller (arising as a
result of subrogation or otherwise) as a result of Guarantor’s payment of all or
a portion of the Guaranteed Obligations. Upon the occurrence and during the
continuance of an Event of Default, Guarantor shall not receive or collect,
directly or indirectly, from Seller or any other party any amount for the
Guarantor Claims until payment in full of the Guaranteed Obligations.
5.2    Claims in Bankruptcy. In the event of receivership, bankruptcy,
reorganization, arrangement, debtor’s relief, or other insolvency proceedings
involving Seller as debtor, Administrative Agent shall have the right to prove
its claims in any such proceeding so as to establish its rights hereunder and
receive directly from the receiver, trustee or other court custodian dividends
and payments which would otherwise be payable for the Guarantor Claims.
Guarantor hereby assigns such dividends and payments to Administrative Agent.
Should Administrative Agent receive, for application upon the Guaranteed
Obligations, any such dividend or payment which is otherwise payable to
Guarantor, and which, as between Seller and Guarantor, shall constitute a credit
for the Guarantor Claims, then upon payment to Administrative Agent in full of
the Guaranteed Obligations, Guarantor shall become subrogated to the rights of
Administrative Agent to the extent that such payments to Administrative Agent on
the Guarantor Claims have contributed toward the liquidation of the Guaranteed
Obligations, and such subrogation shall be with respect to that proportion of
the Guaranteed Obligations which would have been unpaid if Administrative Agent
had not received dividends or payments for the Guarantor Claims.
5.3    Payments Held in Trust. In the event that, notwithstanding anything to
the contrary in this Guaranty, Guarantor should receive any funds, payment,
claim or distribution which is prohibited by this Guaranty, Guarantor agrees to
hold in trust for Administrative Agent an amount equal to the amount of all
funds, payments, claims or distributions so received, and agrees to promptly pay
such amounts to Administrative Agent.
5.4    Liens Subordinate. Guarantor agrees that any liens, security interests,
judgment liens, charges or other encumbrances upon Seller’s assets securing
payment of the Guarantor Claims shall be and remain inferior and subordinate to
any liens, security interests, judgment liens, charges or other encumbrances
upon Seller’s assets securing payment of the Guaranteed Obligations, regardless
of whether such encumbrances in favor of Guarantor presently exist or are
hereafter created or attach. Without the prior written consent of Administrative
Agent, Guarantor shall not (1) exercise or enforce any creditor’s right it may
have against Seller, or (1) foreclose, repossess, sequester or otherwise take
steps or institute any action or proceedings (judicial or otherwise, including
without limitation the commencement of, or joinder in, any liquidation,
bankruptcy, rearrangement, debtor’s relief or insolvency proceeding) to enforce
any liens, mortgage, deeds of trust, security interests, collateral rights,
judgments or other encumbrances on assets of Seller securing payment of the
Guarantor Claims held by Guarantor.
ARTICLE VI    

MISCELLANEOUS
6.1    Waiver. No failure to exercise, and no delay in exercising, on the part
of Administrative Agent, any right hereunder shall operate as a waiver thereof,
nor shall any single or partial exercise thereof preclude any other or further
exercise thereof or the exercise of any other right. The rights of
Administrative Agent hereunder shall be in addition to all other rights provided
by law. No modification or waiver of any provision of this Guaranty, nor consent
to departure therefrom, shall be effective unless in writing and no such consent
or waiver shall extend beyond the particular case and purpose involved. No
notice or demand given in any case shall constitute a waiver of the right to
take other action in the same, similar or other instances without such notice or
demand (except to the extent such a notice or demand is required by the terms
hereof).
6.2    Notices. Unless otherwise provided in this Guaranty, 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
(1) hand delivery, with proof of delivery, (1) certified or registered United
States mail, postage prepaid, (1) expedited prepaid delivery service, either
commercial or United States Postal Service, with proof of delivery, (1) by
telecopier (with answerback acknowledged); provided that such telecopied notice
must also be delivered by one of the means set forth above, or (1) by e-mail
with confirmation of delivery, addressed as follows (or at such other address
and person as shall be designated from time to time by any party hereto, as the
case may be, in a written notice to the other parties hereto in the manner
provided for in this Section 6.2):
If to Guarantor:
KKR Real Estate Finance Holdings L.P.

9 West 57th Street, Suite 4200
New York, New York 10019
Attention: Patrick Mattson
Telephone: (###) ###-####
Email: ###############@kkr.com
with a copy to:
Hunton Andrews Kurth LLP
200 Park Avenue
New York, New York 10166
Attention: Nadia Burgard
Telephone: (###) ###-####
Email: ########@HuntonAK.com

If to Administrative Agent:
Morgan Stanley Mortgage Capital Holdings LLC

1585 Broadway, 25th Floor
New York, New York 10036
Attention: Anthony Preisano
Telephone: (###) ###-####
Fax: (###) ###-####
Email: ################@morganstanley.com

and to:
Morgan Stanley Bank, N.A.
One Utah Center, 201 South Main Street
Salt Lake City, Utah 84111

and to:
Morgan Stanley Bank, N.A.
1 New York Plaza, 41st Floor
New York, New York 10004
Attention: Tom O’Donnell
Telephone: (###) ###-####
Fax: (###) ###-####
Email: #######@morganstanley.com

and to:
Cleary Gottlieb Steen & Hamilton LLP
One Liberty Plaza
New York, New York 10006
Attention: Kimberly Brown Blacklow, Esq.
Telephone: (###) ###-####
Fax: (###) ###-####
Email: #########@cgsh.com

A notice shall be deemed to have been given: (1) in the case of hand delivery,
at the time of delivery, (1) in the case of registered or certified mail, when
delivered or the first attempted delivery on a Business Day, (1) in the case of
expedited prepaid delivery upon the first attempted delivery on a Business Day,
(1) in the case of telecopier, upon receipt of answerback confirmation; provided
that such telecopied notice was also delivered as required in this Section 6.2,
or (1) in the case of e-mail, upon confirmation of delivery. A party receiving a
notice that does not comply with the technical requirements for notice under
this Section 6.2 may elect to waive any deficiencies and treat the notice as
having been properly given.
6.3    Governing Law. This Guaranty shall be governed by, and construed and
interpreted in accordance with, the laws of the State of New York pursuant to
Sections 5-1401 and 5-1402 of the New York General Obligations Law without
giving effect to the conflict of law principles thereof.
6.4    SUBMISSION TO JURISDICTION; WAIVERS. EACH OF GUARANTOR AND, BY ITS
ACCEPTANCE OF THIS GUARANTY, ADMINISTRATIVE AGENT, HEREBY IRREVOCABLY AND
UNCONDITIONALLY: (1) SUBMITS FOR ITSELF AND ITS PROPERTY IN ANY LEGAL ACTION OR
PROCEEDING RELATING TO THIS GUARANTY, OR FOR RECOGNITION AND ENFORCEMENT OF ANY
JUDGMENT IN RESPECT THEREOF, TO THE EXCLUSIVE GENERAL JURISDICTION OF THE COURTS
OF THE STATE OF NEW YORK, THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA FOR
THE SOUTHERN DISTRICT OF NEW YORK, AND APPELLATE COURTS FROM ANY THEREOF; (1)
CONSENTS THAT ANY SUCH ACTION OR PROCEEDING MAY BE BROUGHT IN SUCH COURTS AND,
TO THE EXTENT PERMITTED BY LAW, WAIVES ANY OBJECTION THAT IT MAY NOW OR
HEREAFTER HAVE TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT
OR THAT SUCH ACTION OR PROCEEDING WAS BROUGHT IN AN INCONVENIENT COURT AND
AGREES NOT TO PLEAD OR CLAIM THE SAME; (1) AGREES THAT SERVICE OF PROCESS IN ANY
SUCH ACTION OR PROCEEDING MAY BE EFFECTED BY MAILING A COPY THEREOF BY
REGISTERED OR CERTIFIED MAIL (OR ANY SUBSTANTIALLY SIMILAR FORM OF MAIL),
POSTAGE PREPAID, TO ITS ADDRESS SET FORTH HEREIN OR AT SUCH OTHER ADDRESS OF
WHICH ADMINISTRATIVE AGENT AND/OR GUARANTOR SHALL HAVE BEEN NOTIFIED; AND (1)
AGREES THAT NOTHING HEREIN SHALL AFFECT THE RIGHT TO EFFECT SERVICE OF PROCESS
IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT TO SUE IN ANY
OTHER JURISDICTION.
6.5    WAIVER OF JURY TRIAL. EACH OF GUARANTOR AND, BY ITS ACCEPTANCE OF THIS
GUARANTY, ADMINISTRATIVE AGENT, HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL
PROCEEDING ARISING OUT OF OR RELATING TO THIS GUARANTY OR THE TRANSACTIONS
CONTEMPLATED HEREBY. SUCH WAIVER OF RIGHT TO TRIAL BY JURY IS GIVEN KNOWINGLY
AND VOLUNTARILY, AND IS INTENDED TO ENCOMPASS INDIVIDUALLY EACH INSTANCE AND
EACH ISSUE AS TO WHICH THE RIGHT TO A TRIAL BY JURY WOULD OTHERWISE ACCRUE. ANY
PARTY IS HEREBY AUTHORIZED TO FILE A COPY OF THIS SECTION 6.5 IN ANY PROCEEDING
AS CONCLUSIVE EVIDENCE OF SUCH WAIVER.
6.6    Invalid Provisions. If any provision of this Guaranty is held to be
illegal, invalid, or unenforceable under present or future laws effective during
the term of this Guaranty, such provision shall be fully severable and this
Guaranty shall be construed and enforced as if such illegal, invalid or
unenforceable provision had never comprised a part of this Guaranty, and the
remaining provisions of this Guaranty shall remain in full force and effect and
shall not be affected by the illegal, invalid or unenforceable provision or by
its severance from this Guaranty, unless such continued effectiveness of this
Guaranty, as modified, would be contrary to the basic understandings and
intentions of the parties as expressed herein.
6.7    Reinstatement. This Guaranty shall continue to be effective, or be
reinstated, as the case may be, if at any time payment of the Guaranteed
Obligations, or any part thereof, is rescinded or must otherwise be restored or
returned by Administrative Agent upon the insolvency, bankruptcy, dissolution,
liquidation or reorganization of Seller or upon or as a result of the
appointment of a receiver, intervenor or conservator of, or trustee or similar
officer for Seller or any substantial part of the property of Seller, or
otherwise, all as though such payments had not been made.
6.8    Amendments. This Guaranty may be amended only by an instrument in writing
executed by Guarantor and Administrative Agent.
6.9    Parties Bound; Assignment. This Guaranty shall be binding upon and inure
to the benefit of the parties hereto and their respective successors, assigns
and legal representatives; provided, however, that Guarantor may not, without
the prior written consent of Administrative Agent, assign any of Guarantor’s
rights, powers, duties or obligations hereunder.
6.10    Headings. Section headings are for convenience of reference only and
shall in no way affect the interpretation of this Guaranty.
6.11    Recitals. The recital and introductory paragraphs hereof are a part
hereof, form a basis for this Guaranty and shall be considered prima facie
evidence of the facts and documents referred to therein.
6.12    Counterparts. This Guaranty may be executed in any number of
counterparts, each of which when so executed and delivered shall be an original,
but all of which shall together constitute one and the same instrument. Any
counterpart delivered by facsimile, pdf or other electronic means shall have the
same import and effect as original counterparts and shall be valid, enforceable
and binding for the purposes of this Guaranty.
6.13    Rights and Remedies. If Guarantor becomes liable for any indebtedness
owing by Seller to Administrative Agent, by endorsement or otherwise, other than
under this Guaranty, such liability shall not be in any manner impaired or
affected hereby and the rights of Administrative Agent hereunder shall be
cumulative of any and all other rights that Administrative Agent may ever have
against Guarantor. The exercise by Administrative Agent of any right or remedy
hereunder or under any other instrument, or at law or in equity, shall not
preclude the concurrent or subsequent exercise of any other right or remedy.
6.14    Entirety. This Guaranty embodies the final, entire agreement of
Guarantor and Administrative Agent with respect to Guarantor’s guarantee of the
Guaranteed Obligations and supersedes any and all prior commitments, agreements,
representations, and understandings, whether written or oral, relating to the
subject matter hereof. This Guaranty is intended by Guarantor and Administrative
Agent as a final and complete expression of the terms of this Guaranty, and no
course of dealing between Guarantor and Administrative Agent, no course of
performance, no trade practices, and no evidence of prior, contemporaneous or
subsequent oral agreements or discussions or other extrinsic evidence of any
nature shall be used to contradict, vary, supplement or modify any term of this
Guaranty. There are no oral agreements between Guarantor and Administrative
Agent relating to the subject matter hereof.
6.15    Joint and Several. If Guarantor consists of more than one Person, the
obligations and liabilities of each such Person under this Guaranty shall be
joint and several; provided that, except to the extent caused by fraud or
willful misconduct, in no event shall any direct or indirect partner, member,
shareholder or other owner of Guarantor be liable under this Guaranty and
Administrative Agent’s sole recourse shall be the assets of Guarantor.
6.16    Intent. Guarantor (a) acknowledges that each of the Repurchase Agreement
and each Transaction thereunder constitutes a “securities contract” as that term
is defined in Section 741(7)(A)(i) of the Bankruptcy Code and a “master netting
agreement” as that term is defined in Section 101(38A)(A) of the Bankruptcy
Code, (b) intends and acknowledges that this Guaranty is “a security agreement
or arrangement or other credit enhancement” that is “related to” and provided
“in connection with” the Repurchase Agreement and each Transaction thereunder
and is within the meaning of Sections 101(38A)(A) and 741(7)(A)(xi) of the
Bankruptcy Code and is, therefore, (i) a “securities contract” as that term is
defined in Section 741(7)(A)(xi) of the Bankruptcy Code and (ii) a “master
netting agreement” as that term is defined in Section 101(38A) of the Bankruptcy
Code, (c) intends and acknowledges that that Buyer’s rights under Section 1.1
constitute (i) contractual rights (as defined in Section 555 of the Bankruptcy
Code) under a security agreement or arrangement or other credit enhancement
forming a part of or related to a securities contract and master netting
agreement and/or (ii) contractual rights (as defined in Section 555 of the
Bankruptcy Code) to offset or net out any termination value, payment amount, or
other transfer obligation arising under or in connection with one or more
securities contracts and master netting agreements, as described in Sections
362(b)(6), (27) and 561 of the Bankruptcy Code, (d) any payment or transfer of
property made with respect to this Guaranty is a “margin payment,” “settlement
payment” or “transfer in connection with a securities contract” as such terms
are used in Bankruptcy Code Section 546(e), and (e) damages hereunder shall be
measured in accordance with Section 562 of the Bankruptcy Code. The Guarantor
agrees that it shall not challenge, and hereby waives to the fullest extent
available under applicable law its right to challenge, either (i) the
characterization of this Guaranty, the Repurchase Agreement or any Transaction
thereunder as either a “securities contract” or “master netting agreement”
within the meaning of the Bankruptcy Code, or (ii) whether any payment or
transfer described in clause (d) is a “margin payment,” “settlement payment” or
“transfer in connection with a securities contract” as such terms are used in
Bankruptcy Code Section 546(e) and defined, as applicable, in Bankruptcy Code
Sections 741(5) and 741(8).
[SIGNATURE ON NEXT PAGE]

EXECUTED as of the day and year first above written.
KKR REAL ESTATE FINANCE HOLDINGS L.P.,
a Delaware limited partnership
By:
KKR REAL ESTATE FINANCE TRUST INC.,
its general partner

By: /s/ Patrick Mattson

Name: Patrick Mattson
Title: Authorized Signatory

[AM_ACTIVE 401413304_5]