Exhibit 10.33


 





 


 




 





 


 


$266,575,547.29


 


FIRST AMENDED AND RESTATED
CREDIT AGREEMENT


 


among


 


NRFC WA HOLDINGS, LLC,


NRFC WA HOLDINGS II, LLC,


NRFC WA HOLDINGS VII, LLC,


NRFC WA HOLDINGS X, LLC,


and


NRFC WA HOLDINGS XII, LLC,


as Borrowers


 


NORTHSTAR REALTY FINANCE
CORP.,


and


NORTHSTAR REALTY FINANCE
L.P.,


as Guarantors,


 


THE LENDERS PARTY HERETO,


 


and


 


WACHOVIA BANK, NATIONAL
ASSOCIATION,


as Administrative Agent


 


Dated as of October 28,
2009


 


WELLS FARGO SECURITIES, LLC


(formerly known as Wachovia Capital Markets,
LLC),


as Sole Lead Arranger and Sole Bookrunner


 




 





 


            


 

















 


TABLE OF CONTENTS


 


	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE I DEFINITIONS

  	
   

  	
  1

  
	
  Section 1.1

  	
  Defined Terms

  	
   

  	
  1

  
	
  Section 1.2

  	
  Other Definitional
  Provisions

  	
   

  	
  40

  
	
  Section 1.3

  	
  Accounting Terms

  	
   

  	
  40

  
	
  Section 1.4

  	
  Time References

  	
   

  	
  40

  
	
  Section 1.5

  	
  Execution of Documents

  	
   

  	
  41

  
	
  Section 1.6

  	
  UCC Terms

  	
   

  	
  41

  
	
  Section 1.7

  	
  References to
  Discretion

  	
   

  	
  41

  
	
  Section 1.8

  	
  References to Payment

  	
   

  	
  41

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II THE LOANS;
  AMOUNT AND TERMS

  	
   

  	
  41

  
	
  Section 2.1

  	
  Revolving Loans

  	
   

  	
  41

  
	
  Section 2.2

  	
  Term Loan; Delayed Draw
  Term Loan

  	
   

  	
  46

  
	
  Section 2.3

  	
  Fees

  	
   

  	
  50

  
	
  Section 2.4

  	
  Commitment Reductions

  	
   

  	
  50

  
	
  Section 2.5

  	
  Prepayments

  	
   

  	
  50

  
	
  Section 2.6

  	
  Default Rate and
  Payment Dates

  	
   

  	
  54

  
	
  Section 2.7

  	
  Conversion Options

  	
   

  	
  54

  
	
  Section 2.8

  	
  Computation of Interest
  and Fees; Usury

  	
   

  	
  55

  
	
  Section 2.9

  	
  Pro Rata Treatment and
  Payments

  	
   

  	
  56

  
	
  Section 2.10

  	
  Non-Receipt of Funds by
  the Administrative Agent

  	
   

  	
  59

  
	
  Section 2.11

  	
  Inability to Determine
  Interest Rate

  	
   

  	
  60

  
	
  Section 2.12

  	
  Yield Protection

  	
   

  	
  60

  
	
  Section 2.13

  	
  Indemnity; Eurocurrency
  Liabilities

  	
   

  	
  61

  
	
  Section 2.14

  	
  Taxes

  	
   

  	
  62

  
	
  Section 2.15

  	
  Illegality

  	
   

  	
  64

  
	
  Section 2.16

  	
  Obligations Absolute

  	
   

  	
  64

  
	
  Section 2.17

  	
  Replacement of Lenders

  	
   

  	
  65

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III
  REPRESENTATIONS AND WARRANTIES

  	
   

  	
  66

  
	
  Section 3.1

  	
  Financial Condition

  	
   

  	
  66

  
	
  Section 3.2

  	
  No Material Adverse
  Effect

  	
   

  	
  66

  
	
  Section 3.3

  	
  Corporate Existence;
  Compliance with Law

  	
   

  	
  66

  
	
  Section 3.4

  	
  Corporate Power;
  Authorization; Enforceable Obligations

  	
   

  	
  67

  
	
  Section 3.5

  	
  No Legal Bar; No Default

  	
   

  	
  67

  
	
  Section 3.6

  	
  No Material Litigation

  	
   

  	
  67

  
	
  Section 3.7

  	
  Investment Company Act;
  Federal Power Act; Interstate Commerce Act; and Federal and State Statutes
  and Regulations

  	
   

  	
  68

  
	
  Section 3.8

  	
  Margin Regulations

  	
   

  	
  68

  
	
  Section 3.9

  	
  ERISA

  	
   

  	
  68

  
	
  Section 3.10

  	
  Environmental Matters

  	
   

  	
  68

  
	
  Section 3.11

  	
  Use of Proceeds

  	
   

  	
  69

  
	
  Section 3.12

  	
  Subsidiaries; Joint
  Ventures; Partnerships

  	
   

  	
  69

  
	
  Section 3.13

  	
  Ownership

  	
   

  	
  69

  
	
  Section 3.14

  	
  Indebtedness

  	
   

  	
  69

  
	
  Section 3.15

  	
  Taxes

  	
   

  	
  69

  
	
  Section 3.16

  	
  Solvency

  	
   

  	
  70

  
	
  Section 3.17

  	
  [Reserved]

  	
   

  	
  70

  
	
  Section 3.18

  	
  Location

  	
   

  	
  70

  



 


i

















 


	
  Section 3.19

  	
  No Burdensome
  Restrictions

  	
   

  	
  70

  
	
  Section 3.20

  	
  Brokers’ Fees

  	
   

  	
  70

  
	
  Section 3.21

  	
  [Reserved]

  	
   

  	
  70

  
	
  Section 3.22

  	
  Accuracy and
  Completeness of Information

  	
   

  	
  70

  
	
  Section 3.23

  	
  [Reserved]

  	
   

  	
  71

  
	
  Section 3.24

  	
  Insurance

  	
   

  	
  71

  
	
  Section 3.25

  	
  Security Documents

  	
   

  	
  71

  
	
  Section 3.26

  	
  Anti-Terrorism Laws

  	
   

  	
  71

  
	
  Section 3.27

  	
  Compliance with OFAC
  Rules and Regulations

  	
   

  	
  71

  
	
  Section 3.28

  	
  Compliance with FCPA

  	
   

  	
  72

  
	
  Section 3.29

  	
  Consent; Governmental
  Authorizations

  	
   

  	
  72

  
	
  Section 3.30

  	
  Bulk Sales

  	
   

  	
  72

  
	
  Section 3.31

  	
  Income and Required
  Payments

  	
   

  	
  72

  
	
  Section 3.32

  	
  Full Payment

  	
   

  	
  72

  
	
  Section 3.33

  	
  Irrevocable
  Instructions

  	
   

  	
  72

  
	
  Section 3.34

  	
  Compliance with
  Covenants

  	
   

  	
  73

  
	
  Section 3.35

  	
  Collateral Agreements

  	
   

  	
  73

  
	
  Section 3.36

  	
  No Reliance

  	
   

  	
  73

  
	
  Section 3.37

  	
  Collateral

  	
   

  	
  73

  
	
  Section 3.38

  	
  REIT Status

  	
   

  	
  73

  
	
  Section 3.39

  	
  Insider

  	
   

  	
  73

  
	
  Section 3.40

  	
  No Defenses

  	
   

  	
  74

  
	
  Section 3.41

  	
  Warrant Agreements, Etc.

  	
   

  	
  74

  
	
  Section 3.42

  	
  Value Given

  	
   

  	
  74

  
	
  Section 3.43

  	
  Separateness

  	
   

  	
  74

  
	
  Section 3.44

  	
  Qualified Transferees

  	
   

  	
  74

  
	
  Section 3.45

  	
  Eligibility of Mortgage
  Assets

  	
   

  	
  74

  
	
  Section 3.46

  	
  Ability to Perform

  	
   

  	
  75

  
	
  Section 3.47

  	
  Certain Tax Matters

  	
   

  	
  75

  
	
  Section 3.48

  	
  Set-Off, etc.

  	
   

  	
  75

  
	
  Section 3.49

  	
  Interest Rate
  Protection Agreements

  	
   

  	
  75

  
	
  Section 3.50

  	
  Representations and
  Warranties

  	
   

  	
  75

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV CONDITIONS
  PRECEDENT

  	
   

  	
  76

  
	
  Section 4.1

  	
  Conditions to
  Restatement Date

  	
   

  	
  76

  
	
  Section 4.2

  	
  Conditions to All
  Extensions of Credit

  	
   

  	
  79

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V AFFIRMATIVE
  COVENANTS

  	
   

  	
  83

  
	
  Section 5.1

  	
  Financial Statements

  	
   

  	
  83

  
	
  Section 5.2

  	
  Certificates; Other
  Information

  	
   

  	
  85

  
	
  Section 5.3

  	
  Payment of Taxes and
  Other Obligations

  	
   

  	
  86

  
	
  Section 5.4

  	
  Conduct of Business and
  Maintenance of Existence

  	
   

  	
  86

  
	
  Section 5.5

  	
  Maintenance of
  Property; Insurance

  	
   

  	
  86

  
	
  Section 5.6

  	
  Inspection of Property;
  Books and Records; Discussions

  	
   

  	
  86

  
	
  Section 5.7

  	
  Notices

  	
   

  	
  86

  
	
  Section 5.8

  	
  Environmental Laws

  	
   

  	
  88

  
	
  Section 5.9

  	
  Financial Covenants

  	
   

  	
  88

  
	
  Section 5.10

  	
  Additional Credit
  Parties

  	
   

  	
  89

  
	
  Section 5.11

  	
  Compliance with Law

  	
   

  	
  89

  
	
  Section 5.12

  	
  Pledged Assets

  	
   

  	
  89

  
	
  Section 5.13

  	
  Interest Rate
  Protection Agreements

  	
   

  	
  90

  
	
  Section 5.14

  	
  Control Agreements

  	
   

  	
  90

  



 


ii

















 


	
  Section 5.15

  	
  Further Assurances

  	
   

  	
  90

  
	
  Section 5.16

  	
  Performance and
  Compliance with Collateral

  	
   

  	
  90

  
	
  Section 5.17

  	
  Delivery of Income and
  Required Payments

  	
   

  	
  91

  
	
  Section 5.18

  	
  Exceptions

  	
   

  	
  91

  
	
  Section 5.19

  	
  Distributions in
  Respect of Collateral

  	
   

  	
  91

  
	
  Section 5.20

  	
  REIT Status

  	
   

  	
  91

  
	
  Section 5.21

  	
  Issuances

  	
   

  	
  92

  
	
  Section 5.22

  	
  Remittance of
  Prepayments

  	
   

  	
  92

  
	
  Section 5.23

  	
  Escrow Imbalance

  	
   

  	
  92

  
	
  Section 5.24

  	
  Separateness

  	
   

  	
  92

  
	
  Section 5.25

  	
  Preferred Equity
  Interests

  	
   

  	
  93

  
	
  Section 5.26

  	
  Registration of
  Securities

  	
   

  	
  93

  
	
  Section 5.27

  	
  Termination of
  Securities Account

  	
   

  	
  93

  
	
  Section 5.28

  	
  Independent Director

  	
   

  	
  94

  
	
  Section 5.29

  	
  Main Treasury Bank

  	
   

  	
  94

  
	
  Section 5.30

  	
  Independence of
  Covenants

  	
   

  	
  94

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI NEGATIVE
  COVENANTS

  	
   

  	
  94

  
	
  Section 6.1

  	
  Indebtedness

  	
   

  	
  94

  
	
  Section 6.2

  	
  Liens

  	
   

  	
  94

  
	
  Section 6.3

  	
  Nature of Business

  	
   

  	
  95

  
	
  Section 6.4

  	
  Consolidation, Merger,
  Sale or Purchase of Assets, etc.

  	
   

  	
  95

  
	
  Section 6.5

  	
  Warrant Agreements

  	
   

  	
  96

  
	
  Section 6.6

  	
  Transactions with
  Affiliates

  	
   

  	
  96

  
	
  Section 6.7

  	
  Ownership of
  Subsidiaries; Restrictions

  	
   

  	
  96

  
	
  Section 6.8

  	
  Corporate Changes;
  Material Contracts

  	
   

  	
  96

  
	
  Section 6.9

  	
  [Reserved]

  	
   

  	
  96

  
	
  Section 6.10

  	
  Restricted Payments

  	
   

  	
  96

  
	
  Section 6.11

  	
  [Reserved]

  	
   

  	
  97

  
	
  Section 6.12

  	
  No Further Negative
  Pledges

  	
   

  	
  97

  
	
  Section 6.13

  	
  Collateral Not to be
  Evidenced by Instruments

  	
   

  	
  97

  
	
  Section 6.14

  	
  Deposits

  	
   

  	
  97

  
	
  Section 6.15

  	
  Servicing Agreements

  	
   

  	
  97

  
	
  Section 6.16

  	
  Extension or Amendment
  of Collateral

  	
   

  	
  97

  
	
  Section 6.17

  	
  Additional Covenants

  	
   

  	
  98

  
	
  Section 6.18

  	
  No Future Liens

  	
   

  	
  98

  
	
  Section 6.19

  	
  Senior and Pari Passu Interests

  	
   

  	
  98

  
	
  Section 6.20

  	
  Portfolio Assets

  	
   

  	
  99

  
	
  Section 6.21

  	
  Inconsistent Agreements

  	
   

  	
  99

  
	
  Section 6.22

  	
  Preferred Equity
  Interests

  	
   

  	
  99

  
	
  Section 6.23

  	
  ERISA

  	
   

  	
  99

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VII EVENTS OF
  DEFAULT

  	
   

  	
  99

  
	
  Section 7.1

  	
  Events of Default

  	
   

  	
  99

  
	
  Section 7.2

  	
  Acceleration; Remedies

  	
   

  	
  103

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VIII THE
  ADMINISTRATIVE AGENT

  	
   

  	
  103

  
	
  Section 8.1

  	
  Appointment and
  Authority

  	
   

  	
  103

  
	
  Section 8.2

  	
  Nature of Duties

  	
   

  	
  103

  
	
  Section 8.3

  	
  Exculpatory Provisions

  	
   

  	
  104

  
	
  Section 8.4

  	
  Reliance by
  Administrative Agent

  	
   

  	
  105

  
	
  Section 8.5

  	
  Notice of Default

  	
   

  	
  105

  



 


iii

















 


	
  Section 8.6

  	
  Non-Reliance on
  Administrative Agent and Other Lenders

  	
   

  	
  105

  
	
  Section 8.7

  	
  Indemnification

  	
   

  	
  105

  
	
  Section 8.8

  	
  Administrative Agent in
  Its Individual Capacity

  	
   

  	
  106

  
	
  Section 8.9

  	
  Successor
  Administrative Agent

  	
   

  	
  106

  
	
  Section 8.10

  	
  Collateral and Guaranty
  Matters

  	
   

  	
  107

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IX ADMINISTRATION AND SERVICING

  	
   

  	
  107

  
	
  Section 9.1

  	
  Servicing

  	
   

  	
  107

  
	
  Section 9.2

  	
  Borrowers as Servicer

  	
   

  	
  108

  
	
  Section 9.3

  	
  Third Party Servicer

  	
   

  	
  108

  
	
  Section 9.4

  	
  Duties of the Borrowers

  	
   

  	
  108

  
	
  Section 9.5

  	
  Authorization of the
  Borrowers

  	
   

  	
  109

  
	
  Section 9.6

  	
  Event of Default

  	
   

  	
  109

  
	
  Section 9.7

  	
  Modification

  	
   

  	
  110

  
	
  Section 9.8

  	
  Inspection

  	
   

  	
  110

  
	
  Section 9.9

  	
  [Reserved]

  	
   

  	
  110

  
	
  Section 9.10

  	
  Payment of Certain
  Expenses by Servicer

  	
   

  	
  110

  
	
  Section 9.11

  	
  Pooling and Servicing
  Agreements

  	
   

  	
  110

  
	
  Section 9.12

  	
  Servicer Default

  	
   

  	
  111

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE X MISCELLANEOUS

  	
   

  	
  111

  
	
  Section 10.1

  	
  Amendments, Waivers and
  Release of Collateral

  	
   

  	
  111

  
	
  Section 10.2

  	
  Notices

  	
   

  	
  113

  
	
  Section 10.3

  	
  No Waiver; Cumulative
  Remedies

  	
   

  	
  115

  
	
  Section 10.4

  	
  Survival of
  Representations and Warranties

  	
   

  	
  115

  
	
  Section 10.5

  	
  Payment of Expenses and
  Taxes; Indemnity

  	
   

  	
  116

  
	
  Section 10.6

  	
  Successors and Assigns;
  Participations

  	
   

  	
  119

  
	
  Section 10.7

  	
  Right of Set-off;
  Sharing of Payments

  	
   

  	
  122

  
	
  Section 10.8

  	
  Table of Contents and
  Section Headings

  	
   

  	
  123

  
	
  Section 10.9

  	
  Counterparts;
  Integration; Effectiveness; Electronic Execution

  	
   

  	
  123

  
	
  Section 10.10

  	
  Severability

  	
   

  	
  123

  
	
  Section 10.11

  	
  Integration

  	
   

  	
  124

  
	
  Section 10.12

  	
  Governing Law

  	
   

  	
  124

  
	
  Section 10.13

  	
  Consent to
  Jurisdiction; Service of Process and Venue

  	
   

  	
  124

  
	
  Section 10.14

  	
  Confidentiality

  	
   

  	
  125

  
	
  Section 10.15

  	
  Acknowledgments

  	
   

  	
  126

  
	
  Section 10.16

  	
  Waivers of Jury Trial

  	
   

  	
  126

  
	
  Section 10.17

  	
  Patriot Act Notice

  	
   

  	
  126

  
	
  Section 10.18

  	
  Resolution of Drafting
  Ambiguities

  	
   

  	
  126

  
	
  Section 10.19

  	
  Continuing Agreement

  	
   

  	
  127

  
	
  Section 10.20

  	
  Lender Consent

  	
   

  	
  127

  
	
  Section 10.21

  	
  Appointment of the
  Administrative Borrower

  	
   

  	
  127

  
	
  Section 10.22

  	
  Counterclaims

  	
   

  	
  127

  
	
  Section 10.23

  	
  Legal Matters

  	
   

  	
  127

  
	
  Section 10.24

  	
  Recourse Against
  Certain Parties

  	
   

  	
  128

  
	
  Section 10.25

  	
  Protection of Right,
  Title and Interest in the Collateral; Further Action Evidencing Loans

  	
   

  	
  128

  
	
  Section 10.26

  	
  Credit Parties’ Waiver
  of Setoff

  	
   

  	
  129

  
	
  Section 10.27

  	
  Periodic Due Diligence
  Review

  	
   

  	
  129

  
	
  Section 10.28

  	
  Character of Loans for
  Income Tax Purposes

  	
   

  	
  129

  
	
  Section 10.29

  	
  Joint and Several
  Liability; Full Recourse Obligations

  	
   

  	
  130

  
	
  Section 10.30

  	
  Amendment and
  Restatement

  	
   

  	
  131

  



 


iv

















 


	
  Section 10.31

  	
  Modification of Other
  Credit Documents

  	
   

  	
  132

  
	
  Section 10.32

  	
  Accredited Investor
  Representations

  	
   

  	
  132

  



 


v

















 


	
  Schedules

  	
   

  
	
   

  	
   

  
	
  Schedule
  1.1(b)

  	
  Collection
  Account

  
	
  Schedule
  1.1(c)

  	
  Asset
  Representations

  
	
  Schedule
  1.1(d)

  	
  Securities
  Account

  
	
  Schedule
  1.1(e)

  	
  Trust
  Preferred Securities

  
	
  Schedule
  1.1(f)

  	
  Construction
  Draw Deliveries

  
	
  Schedule
  3.3

  	
  Jurisdictions
  of Organization and Qualification

  
	
  Schedule
  3.12

  	
  Subsidiaries

  
	
  Schedule
  3.18

  	
  Location

  
	
  Schedule
  5.28

  	
  Independent
  Director

  
	
  Schedule
  9.3

  	
  Servicers

  
	
   

  	
   

  
	
  Exhibits

  	
   

  
	
   

  	
   

  
	
  Exhibit 1.1(a)

  	
  Form of
  Account Designation Notice

  
	
  Exhibit 1.1(b)

  	
  Form of
  Assignment and Assumption

  
	
  Exhibit 1.1(c)

  	
  Form of
  Account Control Agreement

  
	
  Exhibit 1.1(d)(i)

  	
  Form of
  Borrower Joinder Agreement

  
	
  Exhibit 1.1(d)(ii)

  	
  Form of
  Guarantor Joinder Agreement

  
	
  Exhibit 1.1(e)

  	
  Form of
  Notice of Borrowing

  
	
  Exhibit 1.1(f)

  	
  Form of
  Notice of Conversion/Extension

  
	
  Exhibit 1.1(g)

  	
  Form of
  Assignment

  
	
  Exhibit 1.1(h)

  	
  Form of
  Borrower Release Letter

  
	
  Exhibit 1.1(i)

  	
  Form of
  Compliance Certificate

  
	
  Exhibit 1.1(j)

  	
  Form of
  Irrevocable Instruction

  
	
  Exhibit 1.1(k)

  	
  Form of
  Servicer Redirection Notice

  
	
  Exhibit 1.1(l)

  	
  Form of
  Warehouse Lender’s Release Letter

  
	
  Exhibit 1.1(m)

  	
  Form of
  Securities Account Control Agreement

  
	
  Exhibit 2.1(a)

  	
  Form of
  Funding Indemnity Letter

  
	
  Exhibit 2.1(b)

  	
  Form of
  Confirmation

  
	
  Exhibit 2.1(e)

  	
  Form of
  Revolving Note

  
	
  Exhibit 2.2

  	
  Form of
  Term Loan Note

  
	
  Exhibit 4.1(a)

  	
  Form of
  Lender Consent

  
	
  Exhibit 4.1(n)

  	
  Form of
  Closing Officer’s Certificate

  
	
  Exhibit 4.1(o)

  	
  Form of
  Patriot Act Certificate

  
	
  Exhibit 4.1(q)(i)

  	
  Form of
  Power of Attorney for Borrower

  
	
  Exhibit 4.1(q)(ii)

  	
  Form of
  Power of Attorney for Pledgor

  
	
  Exhibit 5.2(f)

  	
  Form of
  Mortgage Asset Data Summary

  



 


vi














 


FIRST AMENDED AND RESTATED CREDIT AGREEMENT, dated as of October 28,
2009, among NRFC WA HOLDINGS, LLC, a Delaware limited liability company
(together with its successors and permitted assigns, “Holdings”), as a
Borrower, NRFC WA HOLDINGS II, LLC, a Delaware limited liability company
(together with its successors and permitted assigns, “Holdings II”), as
a Borrower, NRFC WA HOLDINGS VII, LLC, a Delaware limited liability company
(together with its successors and permitted assigns, “Holdings VII”), as
a Borrower, NRFC WA HOLDINGS X, LLC, a Delaware limited liability company
(together with it successors and assigns, “Holdings X”), as a Borrower,
as a Borrower, NRFC WA HOLDINGS XII, LLC, a Delaware limited liability company
(together with it successors and assigns, “Holdings XII”), as a
Borrower,  NORTHSTAR REALTY FINANCE CORP.,
a Maryland corporation (together with its successors and permitted assigns, “Northstar
Corp”), as a Guarantor, NORTHSTAR REALTY FINANCE L.P., a Delaware limited
partnership (together with its successors and permitted assigns, “Northstar
LP”), as a Guarantor, the other entities from time to time party hereto
pursuant to Section 5.10, the several banks and other financial
institutions as are, or may from time to time become parties to this Agreement
(each, together with its successors and assigns, a “Lender” and,
collectively, the “Lenders”), and WACHOVIA BANK, NATIONAL ASSOCIATION, a
national banking association, as administrative agent for the Lenders hereunder
(in such capacity, together with its successors and assigns, the “Administrative
Agent”).


 


W I T N E S S E T H:


 


WHEREAS, the Borrowers, the Guarantors, the Lenders and the
Administrative Agent are parties to that certain Credit Agreement, dated as of November 6,
2007, as amended by the First Amendment to Credit Agreement, dated as of May 21, 2008
and by the Second Amendment to Credit Agreement, dated as of September 29,
2009 (the “Original Agreement”).


 


WHEREAS, the Credit Parties, the Lenders and the
Administrative Agent desire to amend and restate the Original Agreement in
several respects.


 


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


 


ARTICLE I


 


DEFINITIONS


 


Section 1.1            Defined
Terms.


 


As used in this Agreement, terms defined in the preamble to this
Agreement have the meanings therein indicated, and the following terms have the
following meanings:


 


“40 Act” shall mean the Investment Company Act of 1940, as
amended, restated or modified from time to time.


 


“AAA
IO” shall mean an “AAA” rated bond that is “interest only,” including any
such bond designated “X–C” or “X–P.”


 

















 


“Accepted
Servicing Practices” shall mean, with respect to each item of Collateral,
those mortgage, mezzanine loan and/or secured lending servicing practices, as
applicable, of prudent lending institutions that service Collateral of the same
type, size and structure as such Collateral in the jurisdiction where the
related Underlying Mortgaged Property is located, as applicable, but in any
event, (a) in accordance with the terms of the Credit Documents and
Requirements of Law, (b) without prejudice to the interests of the
Administrative Agent or any Lender, (c) with a view to the maximization of
the recovery on such Collateral on a net present value basis and (d) without
regard to (i) any relationship that any Credit Party or any Affiliate or
any Subsidiary of the foregoing may have with the related Obligor, mortgagor,
any Servicer, any PSA Servicer, any Credit Party or any Affiliate or any
Subsidiary of any of the foregoing; (ii) the right of any Credit Party or
any Subsidiary or Affiliate of the foregoing to receive compensation or other
fees for its services rendered pursuant to this Agreement, the other Credit
Documents, the Mortgage Loan Documents or any other document or agreement; (iii) the
ownership, servicing or management by any Credit Party or any Affiliate or any
Subsidiary of the foregoing for others of any other mortgage loans, assets or
mortgaged property; (iv) any obligation of any Credit Party or any Affiliate
or any Subsidiary of the foregoing to repurchase, repay or substitute any item
of Collateral; (v) any obligation of any Credit Party or any Affiliate or
any Subsidiary of the foregoing to cure a breach of a representation and
warranty with respect to any Collateral and (vi) any debt any Credit Party
or any Affiliate or any Subsidiary of the foregoing has extended to any
Obligor, mortgagor or any Affiliate of such Obligor or mortgagor.


 


“Account Control Agreement” shall mean that certain first
amended and restated letter agreement, dated as of the date hereof, among the
Borrowers, the Administrative Agent and Wachovia substantially in the form of Exhibit 1.1(c) attached
hereto, as amended, modified, extended, restated, replaced, or supplemented
from time to time in accordance with its terms.


 


“Account Designation Notice” shall mean the First Amended and
Restated Account Designation Notice, dated as of the Restatement Date, from the
Borrowers to the Administrative Agent in substantially the form attached hereto
as Exhibit 1.1(a), as amended, modified, extended, restated,
replaced, or supplemented from time to time in accordance with its terms.


 


“Additional Credit Party” shall mean each Person that becomes a
Borrower or Guarantor by execution of a Joinder Agreement in accordance with Section 5.10.


 


“Adjusted Total Assets” shall mean the sum of Total Assets plus
Off–Balance Sheet Assets.


 


“Adjusted
Total Liabilities” shall mean the sum of Total Liabilities plus Off–Balance
Sheet Liabilities minus Trust Preferred Securities.


 


“Administrative Agent” or “Agent” shall have the meaning
set forth in the first paragraph of this Agreement and shall include any
successors in such capacity.


 


“Administrative Borrower” shall mean Holdings.


 


“Administrative Questionnaire” shall mean an Administrative
Questionnaire in a form supplied by the Administrative Agent, as amended,
modified, extended, restated, replaced, or supplemented from time to time in
accordance with its terms.


 


“Affiliate” shall mean, with respect to a specified Person,
another Person that directly, or indirectly through one or more intermediaries,
Controls, is Controlled by or is under common Control with the Person
specified.


 


2

















 


“Agreement” or “Credit Agreement” shall mean this
Agreement, as amended, modified, extended, restated, replaced, or supplemented
from time to time in accordance with its terms.


 


“Allocated Revolving Loan Amount” shall mean, for each item of
Revolving Loan Collateral, the outstanding principal amount of the Revolving
Loans allocated by the Administrative Agent, in its discretion, to the related
Revolving Loan Collateral, which Allocated Revolving Loan Amount shall be set
forth in the related Confirmation, as increased from time to time by additional
Revolving Loans or reduced from time to time by the amount of any principal
payments, prepayments or reductions applied against such Revolving Loans
pursuant to the terms of this Agreement or the Fee Letter.


 


“Allocated Term Loan Amount” shall mean, for each item of Term
Loan Collateral, the outstanding principal amount of the Term Loan (as may be
increased by any Delayed Draw Term Loan) allocated by the Administrative Agent,
in its discretion, to the related Term Loan Collateral, which Allocated Term
Loan Amount shall be set forth in the related Confirmation, as increased by any
additional Delayed Draw Term Loans or reduced from time to time by the amount
of any principal payments, prepayments or reductions applied against such Term
Loans pursuant to the terms of this Agreement or the Fee Letter.


 


“Alternate Base Rate” shall mean, for any day, a rate per annum
equal to the greater of (a) the Prime Rate in effect on such day and (b) the
Federal Funds Effective Rate in effect on such day plus 1/2 of 1%.  For purposes hereof:  “Prime Rate” shall mean, at any time,
the rate of interest per annum publicly announced or otherwise identified from
time to time by Wachovia at its principal office in Charlotte, North Carolina
as its prime rate.  Each change in the
Prime Rate shall be effective as of the opening of business on the day such
change in the Prime Rate occurs.  The
parties hereto acknowledge that the rate announced publicly by Wachovia as its
Prime Rate is an index or base rate and shall not necessarily be its lowest or best
rate charged to its customers or other banks; and “Federal Funds Effective
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 on the next succeeding Business Day, the average of the quotations
for the day of such transactions received by the Administrative Agent from
three federal funds brokers of recognized standing selected by it.  If for any reason the Administrative Agent
shall have determined (which determination shall be conclusive in the absence
of manifest error) that it is unable to ascertain the Federal Funds Effective
Rate, for any reason, including the inability or failure of the Administrative
Agent to obtain sufficient quotations in accordance with the terms above, the
Alternate Base Rate shall be determined without regard to clause (b) of
the first sentence of this definition, as appropriate, until the circumstances
giving rise to such inability no longer exist. 
Any change in the Alternate Base Rate due to a change in the Prime Rate
or the Federal Funds Effective Rate shall be effective on the opening of
business on the date of such change.


 


“Alternate Base Rate Loans” shall mean Loans that bear interest
at an interest rate based on the Alternate Base Rate.


 


“Applicable
Advance Rate” shall mean, with respect to each Mortgage Asset (a) with
respect to Term Loan Collateral under the Term Loans,  the Applicable Advance Rate set forth in the
related Confirmation, (b) in the case of Collateral for the Delayed Draw
Term Loans, the Applicable Advance Rate set forth in the related Confirmation
and (c) in the case of Revolving Loan Collateral under the Revolving
Loans, the Applicable Advance Rate set forth in the related Confirmation, which
shall be no greater than the Applicable Advance Rate set forth in Schedule
1-C to the Fee Letter (as applicable); provided, however,
during the time that any amount is outstanding under the Reindeer Facility, the
Applicable Advance Rates for one (1) or more Pledged Mortgage Assets may
be reduced and/or adjusted 


 


3

















 


in
such manner as the Administrative Agent shall determine in its discretion from
time to time so that the Asset Value of all Pledged Mortgage Assets is equal to
or less than the aggregate principal amount of all Loans outstanding plus the
Note Purchase Margin.


 


“Applicable Percentage” shall have the meaning set forth in the
Fee Letter.


 


“Approved Bank” shall have the meaning set forth in the
definition of “Cash Equivalents.”


 


“Approved Fund” shall mean any Fund that is administered,
managed or underwritten by (a) a
Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate
of an entity that administers or manages a Lender.


 


“Arranger” shall mean Wells Fargo Securities, LLC (formerly
known as Wachovia Capital Markets, LLC), together with its successors and
assigns.


 


“Asset
Schedule and Exception Report” shall have the meaning set forth in the
Custodial Agreement.


 


“Asset
Valuation Period” shall mean (i) with respect to Term Loans, at all
times while the Borrowers are not in compliance with any Bi-Annual Principal
Reduction and, (ii) with respect to Revolving Loans, at any time.


 


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


 


“Assignment and Assumption” shall mean an assignment and
assumption entered into by a Lender and an Eligible Assignee (with the consent
of any party whose consent is required by the definition of Eligible Assignee
and Section 10.6), and accepted by the Administrative Agent, in
substantially the form of Exhibit 1.1(b) or any other form
approved by the Administrative Agent.


 


“Assignment of Leases” shall mean, with respect to any Mortgage,
an assignment of leases thereunder, notice of transfer or equivalent instrument
in recordable form, sufficient under the laws of the jurisdiction wherein the
Underlying Mortgaged Property is located to reflect the assignment of leases to
the holder of the Mortgage or any secured party, as applicable, as any such
Assignment of Leases may be amended, restated, modified or supplemented from
time to time.


 


“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 Mortgaged
Property is located to reflect the assignment of the Mortgage to the holder of
the Mortgage or any secured party, as applicable, as any such Assignment of
Mortgage may be amended, restated, modified or supplemented from time to time.


 


“Assignments”
shall mean the transfer of all of the Borrowers’ rights and interests under an
Eligible Asset pursuant to an assignment executed by the Borrowers in blank,
which assignment shall be in the form of Exhibit 1.1(g) and
shall be otherwise satisfactory to the Administrative Agent in its discretion,
as any such Assignments may be amended, restated, modified or supplemented from
time to time.


 


“ATM Offering” shall
mean the sales of shares of common stock of Northstar Corp in one or more
transactions that are deemed to be “at the market” offerings as defined in Rule 415
under the Securities Act.


 


4

















 


“Authority
Documents” shall mean, as to any Person, the articles or certificate of
incorporation or formation, by-laws, limited liability company agreement,
general partnership agreement, limited partnership agreement, trust agreement,
joint venture agreement or other applicable organizational or governing
documents and the applicable resolutions of such Person, as any such Authority
Documents may be amended, restated, modified or supplemented from time to time.


 


“Availability”
shall mean at any time, an amount equal to the positive excess (if any) of (a) the
lesser of (i) the Revolving Committed Amount, and (ii) the Asset
Value of all Revolving Loan Collateral, minus (b) the aggregate
outstanding principal amount for all Revolving Loans on such day; provided,
however, for so long as and to the extent that the Administrative Agent
does not have a first priority perfected security interest in any item of
Collateral, then such Collateral shall be disregarded for the purposes of
calculating Asset Value under this definition of Availability; provided,
further, however, on and after the occurrence of the Maturity
Date or an Event of Default, the Availability shall be zero (0).


 


“Availability
Correction Deadline” shall have the meaning set forth in Section 2.5.


 


“Available
Borrowing Capacity” shall mean (a) when the outstanding principal
amount under the Term Loan plus the Reindeer Debt is equal to or greater than
$300,000,000, $0, and, (b) when the outstanding principal amount under the
Term Loan plus the Reindeer Debt is less than $300,000,000, $300,000,000 minus
(i) the aggregate outstanding principal amount for all Term Loans on such
day, minus (ii) the Reindeer Debt on such day.


 


“Bailee”
shall mean, with respect to each Table Funded  Mortgage
Asset, the related title company or other settlement agent, in each case,
approved in writing by the Administrative Agent in its reasonable discretion.


 


“Bailee
Agreement” shall mean, the Bailee Agreement among the applicable Borrower,
the Administrative Agent and the Bailee in the form of Annex 13 to
the Custodial Agreement.


 


“Bailee’s
Trust Receipt” shall have the meaning set forth in the Custodial Agreement.


 


“Bankruptcy Code” shall mean the Bankruptcy Code in Title 11 of
the United States Code, as amended, modified, succeeded or replaced from time
to time.


 


“Bankruptcy Event” shall mean any of the events described in Section 7.1(f).


 


“Bankruptcy Event of Default” shall mean an Event of Default
specified in Section 7.1(f).


 


“Basic Mortgage Asset Documents” shall have the meaning set
forth in the Custodial Agreement.


 


“Bi-Annual
Principal Reduction” shall mean the bi-annual principal payments of
$15,000,000 in the aggregate required to be made towards the Reindeer Debt and
the outstanding principal balance of the Term Loans (regardless of the source
of the principal payments including, without limitation, mandatory and
voluntary prepayments made in accordance with the terms of this Agreement or
the Fee Letter) commencing with the date that is six months following the
Restatement Date and continuing on each six-month anniversary thereof.


 


“Book Value” shall mean, with respect to any Mortgage Asset at
any time, an amount as certified by the applicable Borrower, equal to the
lesser of (a) face or par value and (b) the price that the applicable
Borrower initially paid or advanced in respect thereof plus any
additional amounts advanced by the applicable Borrower for or in respect of
such Mortgage Asset, as such Book Value may be marked down 


 


5

















 


by the applicable Borrower from time to time, including, as applicable,
any loss/loss reserve/price adjustments, less an amount equal to the sum
of all principal payments, prepayments or paydowns paid and realized losses and
other writedowns recognized relating to such Mortgage Asset; provided, however,
any such markdowns or adjustments must be made in good faith and shall be
disclosed contemporaneously therewith in writing to the Administrative Agent, which
mark downs or adjustments, without a corresponding payment and application of
principal, may result in a mandatory payment under Section 2.5.


 


“Borrower” or “Borrowers” shall mean, individually and/or
collectively, Holdings, Holdings II, Holdings VII, Holdings X, Holdings XII and
any other entity that becomes a party to this Agreement pursuant to Section 5.10
from time to time, in each case together with their successors and permitted
assigns.


 


“Borrower Joinder Agreement” shall mean a Borrower Joinder
Agreement in substantially the form of Exhibit 1.1(d)(i), executed
and delivered by an Additional Credit Party in accordance with the provisions
of Section 5.10, as amended, modified, extended, restated, replaced, or
supplemented from time to time in accordance with its terms.


 


“Borrower
Asset Schedule” shall have the meaning set forth in the Custodial
Agreement.


 


“Borrower
Release Letter” shall mean a letter in the form of Exhibit 1.1(h),
duly executed by the applicable Borrower.


 


“Borrowing
Capacity” shall mean the ability to obtain draws or advances at the request
of a Guarantor or any Affiliate or Subsidiary of a Guarantor in Dollars and
within three (3) Business Days of the request therefor and to use or
apply such draws or advances to repay amounts under the Credit Documents or
Other Credit Facilities.


 


“Borrowing Date” shall mean, the date any Loan is made or any
item of Collateral is pledged to the Administrative Agent pursuant to the terms
hereof and the other Credit Documents.


 


“Bridge
Loan” shall mean a performing Whole Loan that is otherwise an Eligible
Asset except that the Underlying Mortgaged Property is not stabilized or is
otherwise considered to be in a transitional state, which exceptions shall be
disclosed in writing to the Administrative Agent and such exceptions must be
acceptable to the Administrative Agent in its discretion, which acceptance may,
in the Administrative Agent’s discretion, be conditioned on additional terms,
conditions and requirements with respect to such Bridge Loan; provided, however,
the debt and equity fundings for each Bridge Loan must be sufficient to finance
100% of the completion of the improvements to the related Underlying Mortgaged
Property or there must exist sufficient net operating income or interest
reserves or guaranties or replenishments to cover the debt service related to
the Eligible Asset.  Unless waived in
writing by the Administrative Agent in its discretion, a Bridge Loan must
satisfy all of the terms and conditions contained in this Agreement  (other than those eligibility criteria waived in accordance
with the first sentence of this definition) that are applicable to Whole Loans.


 


“Business Day” shall mean any day other than a Saturday, Sunday
or other day on which commercial banks in North Carolina, New York or Minnesota
are authorized or required by Requirements of Law to close; provided, however,
that when used in connection with a rate determination, borrowing or payment in
respect of a LIBOR Rate Loan, the term “Business Day” shall also exclude any
day on which banks in London, England are not open for dealings in Dollar
deposits in the London interbank market.


 


6

















 


“Capital Lease” shall mean any lease of (or other agreement
conveying the right to use) Property, real or personal, the obligations with
respect to which are required to be capitalized on a balance sheet of the
lessee in accordance with GAAP.


 


“Capital Lease Obligations” shall mean, for any Person and its
Consolidated Subsidiaries, all obligations of such Person to pay rent or other
amounts under a Capital Lease, and, for purposes of this Agreement, the amount
of such obligations shall be the capitalized amount thereof, determined in
accordance with GAAP.


 


“Cash Collateral” shall mean the cash or payments received by
the Administrative Agent pursuant to Section 2.5 of this Agreement or the
Fee Letter or as Income on any Collateral.


 


“Cash Equivalents” shall mean any of the following:  (a) securities issued or directly and
fully guaranteed or insured by the United States or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States is pledged in support thereof) having maturities of not more than
one (1) year from the date of acquisition, (b) time deposits or
certificates of deposit of any commercial bank incorporated under the laws of
the United States or any state thereof, of recognized standing having capital
and unimpaired surplus in excess of $1,000,000,000 and whose short-term
commercial paper rating at the time of acquisition is at least A-1 or the
equivalent thereof by S&P or at least P-1 or the equivalent thereof by
Moody’s (any such bank, an “Approved Bank”), with such deposits or
certificates having maturities of not more than one (1) year from the
date of acquisition, (c) repurchase obligations with a term of not more
than seven (7) days for underlying securities of the types described
in clauses (a) and (b) above entered into with any Approved
Bank, (d) commercial paper or finance company paper issued by any Person
incorporated under the laws of the United States or any state thereof and rated
at least A-1 or the equivalent thereof by S&P or at least P-1 or the
equivalent thereof by Moody’s, and in each case maturing not more than
one (1) year after the date of acquisition, and (e) investments
in money market funds that are registered under the 40 Act, which have net
assets of at least $1,000,000,000 and at least 85% of whose assets consist of
securities and other obligations of the type described in clauses (a) through
(e) above.  All such Cash
Equivalents must be denominated solely for payment in Dollars.


 


“CDO
Issuance” shall mean any securitization transaction involving the issuance
of collateralized debt obligations.


 


“CDO
Securitization Transaction” shall mean a commercial real estate cash flow
CDO securitization transaction involving some or all of the Mortgage Assets
engaged in by an Affiliate of any of the Guarantors or the Borrower.


 


“Change in Law” shall mean the occurrence, after the date of
this Agreement, of any of the following: 
(a) the adoption or taking effect of any law, rule, regulation or
treaty, (b) any change in any law, rule, regulation or treaty or in the
administration, interpretation or application thereof by any Governmental
Authority or (c) the making or issuance of any request, guideline or
directive (whether or not having the force of law) by any Governmental
Authority.


 


“Class”
shall mean with respect to a Mortgage Asset, such Mortgage Asset’s
classification as a Whole Loan, a Junior Interest, a Mezzanine Loan, a Bridge
Loan, a CMBS Security, a CTL Loan, a Subordinate CTL Loan, Senior Secured Bank
Debt or a Preferred Equity Interest.


 


“Closing
Officer’s Certificate” shall mean a certificate substantially in the form
of Exhibit 4.1(n), duly executed by each of the Credit Parties.


 


7

















 


“CMBS
Security” shall mean (a) a performing fixed or floating rate mortgage–backed
pass–through certificate, representing a beneficial ownership interest in one
or more first lien mortgage loans secured by Commercial Real Estate or (b) a
performing fixed or floating rate certificate in a CDO Issuance, in each case
rated by at least two (2) Rating Agencies as (i) in the case of
Term Loan Collateral, AAA (including AAA IO), AA+, AA, AA-, A+, A, A-, BBB+,
BBB, BBB-, BB+, BB, BB-, B+, B or B- and (ii) in the case of Revolving
Loan Collateral, AAA (including AAA IO), AA+, AA, AA-, A+, A, A-, BBB+, BBB or
BBB-; provided that on a case by case basis, the Administrative Agent
may consider CMBS Securities rated BB+, BB, BB-, B+, B or B-, subject to such
terms and conditions as the Administrative Agent may require in its discretion,
such terms to be set forth in the related Confirmation.


 


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


 


“Collateral”
shall mean the collective reference to the collateral described in the Security
Documents which secures all Obligations (including, without limitation, the
Term Loan and the Revolving Loan).


 


“Collateral
Default” shall mean any Mortgage Asset included or proposed to be included
in the Collateral (a) that is, with respect to any default in payment of
principal and/or interest, sixty (60) or more days delinquent under the terms
of the related Mortgage Loan Documents (including any Preferred Equity Interest
that has not been paid during such period) or, with respect to any other
material payment default, seventy five (75) or more days delinquent under the
terms of the related Mortgage Loan Documents (including any Preferred Equity
Interest that has not been paid during such period), or (b) for which
there is a material non-monetary default (beyond any applicable notice and cure
period) under the terms of the related Mortgage Loan Documents (including, for
the avoidance of doubt, any Insolvency Proceeding or Insolvency Event of the
related Obligor) which results in acceleration.


 


“Collateral
Default Date” shall have the meaning set forth in Section 2.5(b)(ii).


 


“Collection
Account” shall mean the account set forth on Schedule 1.1(b), which is established in the name of one or
more Borrowers and subject to the Account Control Agreement and into which all
Income and Cash Collateral shall be deposited. 
Funds in the Collection Account may be invested at the direction of the
Administrative Agent in Cash Equivalents.


 


“Commercial
Real Estate” shall mean any real estate included in the definition of
Property Type.


 


“Commercial
Real Estate Loan” shall mean any loan secured directly or indirectly by
Commercial Real Estate or, as applicable, Equity Interests in an entity that
owns directly or indirectly Commercial Real Estate.


 


“Commitment”
shall mean the Revolving Commitments, Delayed Draw Term Loan Commitment and the
Term Loan Commitments, individually or collectively, as appropriate.


 


“Commitment
Fee” shall mean the “Commitment Fee” payable under the Fee Letter.


 


“Commitment
Percentage” shall mean the Revolving Commitment Percentage and/or the Term
Loan Commitment Percentage, as appropriate.


 


“Commitment
Period” shall mean the period from and including the Restatement Date to
but excluding the Revolver Maturity Date.


 


8

















 


“Compliance
Certificate” shall mean a certificate in the form of Exhibit 1.1(i) attached
hereto, duly executed by the Credit Parties.


 


“Confirmation”
shall have the meaning set forth in Section 2.1.


 


“Consolidated” shall
mean, when used with reference to financial statements or financial statement
items of the Borrowers, the Guarantors and their Subsidiaries or any other
Person, such statements or items on a consolidated basis in accordance with the
consolidation principles of GAAP.


 


“Consolidated
Adjusted EBITDA” shall mean, for any period, with respect to any Person,
the sum, without duplication, for such period of (a) the Net Income of
such Person and its Consolidated Subsidiaries determined on a consolidated
basis for such period, (b) the sum of the provisions for such period for
income taxes, interest expense, and depreciation and amortization expense used
in determining such Net Income for such Person and its Consolidated
Subsidiaries, (c) amounts deducted in accordance with GAAP in respect of
other non–cash expenses in determining such Net Income for such Person and its
Consolidated Subsidiaries and (d) the amount of any aggregate net loss (or
minus the amount of any gain) during such period arising from the sale,
exchange or other disposition of capital assets by such Person and its
Consolidated Subsidiaries determined on a consolidated basis, in each event,
excluding unrealized gains/losses, any fees payable to advisors for raising
private equity capital, amortization of financing fees and amortization of bond
discount associated with convertible debt outstanding.


 


“Construction
Costs” shall mean with respect to a Mortgage Asset that is a Bridge Loan or
a Construction Loan, as of any date of determination, the reasonable hard and
soft costs of proposed construction of the improvements on the Underlying
Mortgaged Property, which reasonable costs shall be disclosed to and approved
by the Administrative in its discretion, plus the market value of the
related Underlying Mortgaged Property at such time, as determined by the
Administrative Agent in its reasonable discretion based on such sources of
information as the Administrative Agent may determine to rely on in its
discretion; provided that the market value of the Underlying Mortgaged
Property shall at no time be deemed less than the purchase price therefor.


 


“Construction
Draw Deliveries” shall mean the deliveries required in Schedule 1.1(f) to
this Agreement.


 


“Construction
Loan” shall mean a performing Whole Loan, the Underlying Mortgaged Property
for which has received all necessary entitlements and approvals to develop the
Underlying Mortgaged Property and construct improvements thereon in a manner
consistent with the applicable Borrower’s representations to the Administrative
Agent regarding such construction, which information shall be set forth in the
related Confirmation, such loan and the documents related thereto are otherwise
acceptable to the Administrative Agent in its discretion and all construction
related documents are delivered to the Custodian as a part of the Mortgage
Asset File for such Whole Loan.


 


“Contingent
Liabilities” shall mean, with respect to any Person and its Consolidated
Subsidiaries (without duplication):  (a) liabilities
and obligations (including any Guarantee Obligations) of such Person or any
Consolidated Subsidiary of such Person in respect of “off-balance sheet
arrangements” (as defined in the SEC Off-Balance Sheet Rules), (b) any
obligation, including, without limitation, any Guarantee Obligation, whether or
not required to be disclosed in the footnotes to such Person’s and its
Consolidated Subsidiaries’ financial statements, guaranteeing partially or in
whole any Non-Recourse Indebtedness, lease, dividend or other obligation,
exclusive of (i) contractual indemnities (including, without limitation,
any indemnity or price-adjustment provision relating to the purchase or sale of
securities or other assets) and (ii) guarantees of non-monetary
obligations (other than guarantees of completion, environmental indemnities and
guarantees of customary carve-out matters made in connection with Non-Recourse 


 


9

















 


Indebtedness,
such as (but not limited to) fraud, misappropriation, bankruptcy and
misapplication) which have not yet been called on or quantified, of such Person
or of any other Person, and (c) any forward commitment or obligation to
fund or provide proceeds with respect to any loan or other financing which is
obligatory and non-discretionary on the part of the lender.  The amount of any Contingent Liabilities
described in clause (b) shall be deemed to be, (i) with respect
to a guarantee of interest or interest and principal, or operating income
guarantee, the sum of all payments required to be made thereunder (which, in
the case of an operating income guarantee, shall be deemed to be equal to the
debt service for the note secured thereby), through, (x) in the case of an
interest or interest and principal guarantee, the stated date of maturity of
the obligation (and commencing on the date interest could first be payable
thereunder), or (y) in the case of an operating income guarantee, the date
through which such guarantee will remain in effect, and (ii) with respect
to all guarantees not covered by the preceding clause (i), an amount equal
to the stated or determinable amount of the primary obligation in respect of
which such guarantee is made or, if not stated or determinable, the maximum
reasonably anticipated liability in respect thereof (assuming such Person is
required to perform thereunder) as recorded on the balance sheet and on the
footnotes to the most recent financial statements of such Person.  As used in this definition, the term “SEC
Off-Balance Sheet Rules” means the Disclosure in Management’s Discussion and
Analysis About Off-Balance Sheet Arrangements and Aggregate Contractual
Obligations, Securities Act Release No. 33-8182, 34-47264; FR-67
International Series Release No. 1266 File No. S7-42-02, 68 Fed.
Reg. 5982 (Feb. 5, 2003) (codified at 17 CFR pts. 228, 229 and 249).


 


“Contractual
Obligation” shall mean, as to any Person, any provision of any security
issued by such Person or of any contract, agreement, instrument or undertaking
to which such Person is a party or by which it or any of its Property is bound.


 


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


 


“Correction
Amount” shall have the meaning set forth in Section 2.5(b)(i)(A).


 


“Credit
Documents” shall mean this Agreement, each of the Notes, any Joinder
Agreement, the Fee Letter, the Guaranty, each Notice of Borrowing, each
Confirmation, the Custodial Fee Letter, the Security Documents, the Warrant
Agreements and all other agreements, documents, certificates and instruments
delivered to the Administrative Agent or any Lender by any Credit Party in
connection therewith, as each such agreement, document, certificate or
instrument is amended, restated, modified or supplemented from time to time.


 


“Credit
Party” shall mean any of the Borrowers, the Guarantors, the Pledgor, any
Additional Credit Party or any pledgor or obligor under the Security Documents.


 


“Credit Party–Related
Obligations” shall mean any obligations, liabilities and/or Indebtedness of
the Credit Parties under each Credit Document and under any other debt
arrangement between any Credit Party, on the one hand, and the Administrative
Agent, any Affiliate or Subsidiary of the Administrative Agent and/or any
commercial paper conduit for which Wachovia or an Affiliate or Subsidiary of
Wachovia acts as a liquidity provider, administrator or agent, on the other
hand, including, without limitation, such obligations, liabilities and/or
Indebtedness under the Reindeer Facility, as any such Credit Party-Related
Obligations are amended, restated or modified from time to time.


 


“Credit
Tenant” shall mean the tenant or guarantor under a Credit Tenant Lease with
a credit rating of BBB– or better by at least two (2) Rating
Agencies.


 


10














 


“Credit
Tenant Lease” shall mean a financeable lease of Commercial Real Estate,
which lease is a triple net lease (i.e., the tenant is responsible for all
maintenance, insurance and taxes), a double net lease (i.e., the tenant is
responsible for all taxes and insurance) or is a bondable lease, as the same
may be amended, restated, modified or supplemented from time to time.


 


“CTL
Loan” shall mean a performing Whole Loan secured by a first priority
perfected security interest in Commercial Real Estate 100% leased under a
Credit Tenant Lease to, or guaranteed in full by, a Credit Tenant and all
payments due under such Credit Tenant Lease, and such CTL Loan satisfies such
additional underwriting criteria and other terms, conditions and requirements
as the Administrative Agent may require in its discretion.


 


“Current
Appraisal” shall mean an appraisal dated within twelve (12) months of
the date of determination; provided, however, (i) in the
case of the valuation of an Underlying Mortgaged Property, such appraisal shall
be a FIRREA Appraisal and (ii) in the case of the valuation of a Mortgage
Asset, such appraisal shall be from a nationally recognized appraisal firm
(other than the Borrowers, the Guarantors or any Affiliate of the foregoing) (A) with
substantial experience valuing assets similar in type, size and structure to
the Mortgage Asset in question, (B) having substantial familiarity with
the market for such Mortgage Asset and (C) that is otherwise acceptable to
the Administrative Agent in its discretion.


 


“Custodial
Agreement” shall mean that certain First Amended and Restated Custodial
Agreement, dated as of the date hereof, by and among the Borrowers, the
Administrative Agent and the Custodian, as the same shall be amended, modified,
waived, supplemented, extended, replaced or restated from time to time.


 


“Custodial
Fee Letter” shall mean that certain Custodial Fee Letter, dated as of November 6, 2007,
between the Borrowers and the Custodian, as such letter may be amended,
modified, waived, supplemented, extended, restated or replaced from time to
time.


 


“Custodial
Identification Certificate” shall have the meaning set forth in the
Custodial Agreement.


 


“Custodian”
shall mean Wells Fargo Bank, National Association, and its successor in
interest as the custodian under the Custodial Agreement, and any successor
Custodian under the Custodial Agreement.


 


“Debt
Issuance” shall mean any issuance of debt securities or debt capital
(whether public or private) by Northstar Corp.


 


“Debt
Net Cash Proceeds Payment” shall have the meaning set forth in Section 2.5(b)(v).


 


“Debt
Service Coverage Ratio” or “DSCR” shall mean with respect to any
Mortgage Asset, as of any date of determination, for the period of time to be
determined in the Administrative Agent’s reasonable discretion (it being
understood that it is the Administrative Agent’s intent to make the
determination based on the period of twelve (12) consecutive complete
calendar months preceding such date (or, if such Mortgage Asset was originated
less than twelve (12) months from the date of determination, the number of
months from the date of origination)), the ratio of (a) the aggregate Net
Cash Flow in respect of the Underlying Mortgaged Properties relating to such
Mortgage Asset for such period, taking into account (i) any guaranty of
the indebtedness under the related Mortgage Asset and (ii) any applicable
interest reserves held during such time by any Borrower or Servicer on its
behalf or future funding obligations or monies available to satisfy such
obligations with respect to such Mortgage Asset and, as applicable, the senior
mortgage lender for the related Underlying Mortgaged Property, to  


 


11

















 


(b) the
sum of (i) the aggregate of all amounts due for such period in respect of
all Indebtedness that was outstanding from time to time during such period that
is secured, directly or indirectly, by such Underlying Mortgaged Properties
(including, without limitation, by way of a pledge of the equity of the owner(s) of
such Underlying Mortgaged Properties) or that is otherwise owing by the owner(s) of
such Underlying Mortgaged Properties, including, without limitation, all
scheduled principal and/or interest payments due for such period in respect of
each Mortgage Asset that is secured or supported by such Underlying Mortgaged
Properties plus (ii) the amount of all Ground Lease payments to be
made in respect of such Underlying Mortgaged Properties during such period, as
any of the foregoing elements of DSCR may be adjusted by the Administrative
Agent  as determined by the
Administrative Agent in its reasonable discretion; provided, however,
that all such calculations shall be made taking into account any senior or pari passu debt or other obligations including debt or other
obligations secured directly or indirectly by the applicable Underlying
Mortgaged Property.


 


“Default”
shall mean any of the events specified in Section 7.1, whether or not any
requirement for the giving of notice or the lapse of time, or both, or any other
condition, has been satisfied.


 


“Default
Rate” shall mean (a) when used with respect to the Obligations, an
interest rate equal to (i) for Alternate Base Rate Loans (A) the
Alternate Base Rate plus (B) the Applicable Percentage, if any,
applicable to Alternate Base Rate Loans plus (C) 2% per annum and, (ii) for
LIBOR Rate Loans, (A) the LIBOR Rate plus (B) the Applicable
Percentage applicable to LIBOR Rate Loans plus (C) 2% per annum,
and (b) when used with respect to any other fee or amount due hereunder, a
rate equal to the Applicable Percentage, if any, applicable to Alternate Base
Rate Loans plus 2% per annum.


 


“Defaulting
Lender” shall mean, at any time, any Lender that, at such time (a) has
failed to make a Loan required pursuant to the terms of this Agreement, (b) has
failed to pay to the Administrative Agent or any Lender an amount owed by such
Lender pursuant to the terms of this Agreement and such default remains
uncured, or (c) has been deemed insolvent or has become subject to an
Insolvency Proceeding, Insolvency Event or to a receiver, trustee or similar
official.


 


“Deficit”
shall have the meaning set forth in Section 2.5(b)(iii).


 


“Delayed
Draw Term Loan” shall have the meaning set forth in Section 2.2(b).


 


“Delayed
Draw Term Loan Commitment” shall mean, with respect to each Term Loan
Lender, the commitment of such Term Loan Lender to make its portion of the
Delayed Draw Term Loan in a principal amount equal to such Term Loan Lender’s
Term Loan Commitment Percentage of the Delayed Draw Term Loan Committed Amount.


 


“Delayed
Draw Term Loan Committed Amount” shall have the meaning set forth in Section 2.2(b).


 


“Derivatives
Contract”  shall mean any and all
rate swap transactions, basis swaps, credit derivative transactions, forward
rate transactions, commodity swaps, commodity options, forward commodity
contracts, equity or equity index swaps or options, bond or bond price or bond
index swaps or options or forward bond or forward bond price or forward bond
index transactions, interest rate options, forward foreign exchange
transactions, cap transactions, floor transactions, collar transactions,
currency swap transactions, cross-currency rate swap transactions, currency
options, spot contracts, or any other similar transactions or any combination of
any of the foregoing (including any options to enter into any of the
foregoing), whether or not any such transaction is governed by or subject to
any master agreement.  Not in limitation
of the foregoing, the term “Derivatives Contract” includes any and all
transactions of any kind, and the related confirmations, which are subject to
the terms and conditions of, or governed by, 


 


12

















 


any
form of master agreement published by the International Swaps and Derivatives
Association, Inc., any International Foreign Exchange Master Agreement, or
any other master agreement, including any such obligations or liabilities under
any such master agreement.


 


“Derivatives
Termination Value” shall mean, in respect of any one or more Derivatives
Contracts, after taking into account the effect of any legally enforceable
netting agreement relating to such Derivatives Contracts, (a) for any date
on or after the date such Derivatives Contracts have been closed out and
termination value(s) determined in accordance therewith, such termination
value(s), and (b) for any date prior to the date referenced in
clause (a), the amount(s) determined as the mark-to-market value(s) for
such Derivatives Contracts, as determined based upon one or more mid-market or
other readily available quotations provided by any recognized dealer in such
Derivatives Contracts (which may include the Administrative Agent).


 


“Dollars”
and “$” shall mean dollars in lawful currency of the United States of
America.


 


“Domestic
Lending Office” shall mean, initially, the office of each Lender designated
as such Lender’s Domestic Lending Office shown in such Lender’s Administrative
Questionnaire; and thereafter, such other office of such Lender as such Lender
may from time to time specify to the Administrative Agent and the Borrowers as
the office of such Lender at which Alternate Base Rate Loans of such Lender are
to be made.


 


“Domestic
Subsidiary” shall mean any Subsidiary that is organized and existing under
the laws of the United States or any state or commonwealth thereof or under the
laws of the District of Columbia.


 


“DTC”
shall mean The Depository Trust Company, a limited purpose company under the
banking laws of the State of New York.


 


“Due
Diligence Costs” shall have the meaning set forth in Section 10.27.


 


“Due
Diligence Review” shall mean the performance by the Administrative Agent of
any or all of the reviews permitted under Section 10.27 with respect to
any or all of the Collateral, as desired by the Administrative Agent from time
to time.


 


“Electronic
Transmission” shall mean the delivery of information and executed documents
in an electronic format acceptable to the applicable recipient thereof.


 


“Eligible Asset” shall mean a Mortgage Asset
that as of any date of determination:


 


(a)           is not subject to a Collateral
Default;


 


(b)           with respect to the portion of such
Mortgage Asset to be pledged to the Administrative Agent, the funding
obligations have been satisfied in full and there is no unfunded commitment
with respect thereto (unless otherwise approved by the Administrative Agent in
its discretion);


 


(c)           has been approved in writing by the
Administrative Agent in its discretion;


 


(d)           has, to the extent applicable, an LTV
not in excess of the Maximum LTV, and, with respect to Bridge Loans and
Construction Loans, an LTC not in excess of the Maximum LTC;


 


13

















 


(e)           has, to the extent applicable, a DSCR
equal to or greater than the Minimum DSCR;


 


(f)            with respect to Revolving Loans and
Mortgage Assets to be included in the Revolving Loan Collateral, is not a
Construction Loan;


 


(g)           is not a loan to an operating
business (other than a hotel);


 


(h)           the pledge of such Mortgage Asset
will not violate any applicable Sub—Limit;


 


(i)            satisfies each of the applicable
representations and warranties set forth in Article III of this Agreement
(to the extent any such representations or warranties relate to the Mortgage
Assets or the Administrative Agent’s rights or remedies with respect thereto),
in the eligibility criteria set forth in Schedule 1.1(c) hereto
and the Mortgage Loan Documents;


 


(j)            in the case a Ground Lease, the
Ground Lease has a remaining term of no less than twenty (20) years from
the maturity date of the Mortgage Asset;


 


(k)           the Underlying Mortgaged Property is
located, and the Obligor is domiciled, in the United States of America
(unless otherwise approved by the Administrative Agent subject to such
additional terms and conditions as the Administrative Agent may require in its
discretion);


 


(l)            such Mortgage Asset is denominated
and payable in Dollars unless otherwise approved by the Administrative Agent in
its discretion;


 


(m)          the Obligor is not
a Sanctioned Person or Sanctioned Entity; and


 


(n)           does not involve an equity or similar
interest by any Credit Party that would result in (i) a conflict of
interest or a potential conflict of interest or (ii) an affiliation with
an Obligor under the terms of the Mortgage Loan Documents which results or
could result in the loss or impairment of any material rights of the holder of
the Mortgage Asset; provided, however, the Borrowers
must disclose to the Administrative Agent prior to the related
Borrowing Date all equity or similar interests held or to be held by any
Credit Party regardless of whether it satisfies any of the foregoing
clauses (i) or (ii);


 


provided, however, notwithstanding a Mortgage
Asset’s failure to conform to the criteria set forth above (including, without
limitation, a Mortgage Asset with a single or split rating by a Rating Agency),
the Administrative Agent may, in its discretion and subject to such terms,
conditions and requirements and Applicable Advance Rate adjustments as the
Administrative Agent may require in its discretion, designate in writing any such
non—compliant Mortgage Asset as an Eligible Asset, which designation shall not
be deemed a waiver of the requirement that all other Mortgage Assets pledged to
the Administrative Agent, whether existing or in the future, must be Eligible
Assets.


 


“Eligible
Assignee” shall mean (a) a Lender, (b) an Affiliate of a Lender, (c) an
Approved Fund, and (d) any other Person (other than a natural person)
approved by (i) the Administrative Agent and (ii) so long as no
Default or Event of Default has occurred and is continuing, the Borrowers
(such  consent not to be unreasonably
withheld or delayed); provided that notwithstanding the foregoing, “Eligible
Assignee” shall not include the Borrowers, Guarantors or any Borrower’s or
Guarantor’s Affiliates or Subsidiaries.


 


“Environmental
Laws” shall mean any and all applicable foreign, federal, state, local or
municipal laws, rules, orders, regulations, statutes, ordinances, codes,
decrees, requirements of any 


 


14

















 


Governmental
Authority or other Requirements of Law (including common law) regulating,
relating to or imposing liability or standards of conduct concerning protection
of human health or the environment, as now or may at any time be in effect
during the term of this Agreement.


 


“Equity
Interests” shall mean with respect to any Person, any share, interest,
participation and other equivalent (however denominated) of capital stock of
(or other ownership, equity or profit interests in) such Person, any warrant,
option or other right for the purchase or other acquisition from such Person of
any share of capital stock of (or other ownership, equity or profit interests
in) such Person, any security convertible into or exchangeable for any share of
capital stock of (or other ownership or profit interests in) such Person or
warrant, right or option for the purchase or other acquisition from such Person
of such shares (or such other interests), and any other ownership or profit
interest in such Person (including, without limitation, partnership, member or
trust interests therein), whether voting or nonvoting, and whether or not such
share, warrant, option, right or other interest is authorized or otherwise
existing on any date of determination.


 


“Equity
Issuance” shall mean any issuance by Northstar Corp to any Person (other
than equity based compensation issued to officers, directors or employees of
Northstar Corp) of (a) shares or interests of its Equity Interest, (b) any
shares or interests of its Equity Interest pursuant to the exercise of options
or warrants (other than those owned by Wachovia pursuant to  the Warrant Agreements) or similar rights, or
(c) without duplication under any prior prepayment hereunder pursuant to Section 2.5(b)(vi),
warrants (other than those owned by Wachovia pursuant to  the Warrant Agreements) or options or similar
rights that are exercisable or convertible into shares or interests of its
Equity Interest.  The term “Equity
Issuance” shall not include any Debt Issuance.


 


“Equity
Net Cash Proceeds Payment” shall mean any principal payment required in
accordance with Section 2.5(b)(vi).


 


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


 


“ERISA Affiliate”
shall mean (a) any corporation that is a member of the same controlled
group of corporations (within the meaning of Section 414(b) of the
Code) as a Credit Party, (b) a trade or business (whether or not
incorporated) under common control (within the meaning of Section 414(c) of
the Code) with a Credit Party, or (c) a member of the same affiliated
service group (within the meaning of Section 414(m) of the Code) as a
Credit Party, any corporation described in clause (a) above or any
trade or business described in clause (b) above.


 


“Event
of Default” shall mean any of the events specified in Section 7.1; provided,
however, that any requirement for the giving of notice or the lapse of
time, or both, or any other condition, has been satisfied.


 


“Exception
Report” shall have the meaning set forth in the Custodial Agreement.


 


“Exceptions”
shall have the meaning set forth in the Custodial Agreement.


 


“Exchange
Act” shall mean the Securities Exchange Act of 1934, as amended.


 


“Excluded Accounts” shall mean all accounts established to hold
Obligor Reserve Payments and all accounts holding funds that are required to be
disbursed to an Obligor under the terms of the related Mortgage Loan Documents.


 


15

















 


“Excluded
Taxes” shall mean, with respect to the Administrative Agent, any Lender, or
any other recipient of any payment to be made by or on account of any
obligation of the Borrowers hereunder, (a) taxes imposed on or measured by
its overall net income (however denominated), and franchise taxes imposed on it
(in lieu of net income taxes), by the jurisdiction (or any political
subdivision thereof) under the laws of which such recipient is organized or in which
its principal office is located or, in the case of any Lender, in which its
applicable lending office is located, (b) any branch profits taxes imposed
by the United States of America or any similar tax imposed by any other
jurisdiction in which a Borrower is located and (c) in the case of a
Foreign Lender, any withholding tax that is imposed on amounts payable to such
Foreign Lender at the time such Foreign Lender becomes a party hereto (or
designates a new lending office) or is attributable to such Foreign Lender’s
failure or inability (other than as a result of a Change in Law) to comply with
Section 2.14, except to the extent that such Foreign Lender (or its
assignor, if any) was entitled, at the time of designation of a new lending
office (or assignment), to receive additional amounts from the Borrowers with
respect to such withholding tax pursuant to Section 2.14.


 


“Extension
of Credit” shall mean, as to any Lender, the making of a Loan by such
Lender, any conversion of a Loan from one Type to another Type, any extension
of any Loan and any pledge of a Mortgage Asset to the Administrative Agent.


 


“Extraordinary
Receipt” shall mean any Income received by or paid to or for the account of
any Credit Party relating to any item of Collateral and not in the ordinary
course of business, including tax refunds, pension plan reversions, proceeds of
insurance (other than proceeds of business interruption insurance to the extent
such proceeds constitute compensation for lost earnings), condemnation awards
(and payments in lieu thereof), indemnity payments and any purchase price
adjustments.


 


“Fair
Market Value” shall mean, with respect to (a) a security listed on a
national securities exchange or recognized automated quotation system, the
price of such security as reported on such exchange by any widely recognized
reporting method customarily relied upon by financial institutions, and (b) with
respect to any other assets or Property, including realty, the price which
could be negotiated in an arm’s-length free market transaction, for cash,
between a willing seller and a willing buyer, neither of which is under
pressure or compulsion to complete the transaction.


 


“Federal
Funds Effective Rate” shall have the meaning set forth in the definition of
“Alternate Base Rate.”


 


“Fee
Letter” shall mean the First Amended and Restated Fee Letter, dated as of
the date hereof, among the Borrowers, Guarantors and the Administrative Agent,
as amended, modified, extended, restated, replaced, or supplemented from time
to time in accordance with its terms.


 


“Financial
Covenants” shall mean the covenants set forth in Section 5.9 of this
Agreement.


 


“FIRREA
Appraisal” shall mean an appraisal prepared by an independent third party
appraiser approved in writing by the Administrative Agent in its discretion and
satisfying the requirements of Title XI of the Federal Institutions,
Reform, Recovery and Enforcement Act of 1989 and the regulations
promulgated thereunder (as the foregoing are amended, modified, restated,
replaced, waived, substituted, supplemented or extended from time to time), as
in effect on the date of such appraisal.


 


“Fitch”
shall mean  Fitch Ratings, Inc.


 


16

















 


“Foreclosed
Loan” shall mean a loan the security for which has been foreclosed upon by
the Borrowers.


 


“Foreign
Lender” shall mean any Lender that is organized under the laws of a
jurisdiction other than that in which a Borrower is resident for tax
purposes.  For purposes of this
definition, the United States of America, each State thereof and the District
of Columbia shall be deemed to constitute a single jurisdiction.


 


“Fund”
shall mean any Person (other than a natural person) that is (or will be)
engaged in making, purchasing, holding or otherwise investing in commercial loans
and similar extensions of credit in the ordinary course of its business.


 


“GAAP”
shall mean generally accepted accounting principles in effect in the United
States of America applied on a consistent basis, subject, however,
in the case of determination of compliance with the financial covenants set out
in Section 5.9, to the provisions of Section 1.3.


 


“Governmental
Authority” shall mean the government of the United States of America or any
other nation, or of any political subdivision thereof, whether state or local,
and any agency, authority, instrumentality, regulatory body, court, central
bank or other entity exercising executive, legislative, judicial, taxing,
regulatory or administrative powers or functions of or pertaining to government
(including any supra-national bodies such as the European Union or the European
Central Bank).


 


“Ground
Lease” shall mean with respect to any Underlying Mortgaged Property for
which the Obligor has a leasehold interest in the related Underlying Mortgaged
Property or space lease within such Underlying Mortgaged Property, the lease
agreement creating such leasehold interest.


 


“Guarantee
Obligation”  shall mean, as to any Person (the “guaranteeing person”),
without duplication, any obligation of (a) the guaranteeing person or (b) another
Person (including, without limitation, any bank under any letter of credit) to
induce the creation of the obligations for which the guaranteeing person has
issued a reimbursement, counterindemnity or similar obligation, in either case guaranteeing
or in effect guaranteeing any Indebtedness, leases, dividends, Contractual
Obligation, Derivatives Contract or other obligations (the “primary
obligations”) of any other third Person (the “primary obligor”) in
any manner, whether directly or indirectly, including, without limitation, any
obligation of the guaranteeing person, whether or not contingent, (i) to
purchase any such primary obligation or any Property constituting direct or
indirect security therefor, (ii) to advance or supply funds (1) for
the purchase or payment of any such primary obligation or (2) to maintain
working capital or equity capital of the primary obligor or otherwise to
maintain the net worth or solvency of the primary obligor, (iii) to
purchase Property, securities or services primarily for the purpose of assuring
the owner of any such primary obligation of the ability of the primary obligor
to make payment of such primary obligation or (iv) otherwise to assure or
hold harmless the owner of any such primary obligation against loss in respect
thereof; provided, however, that the term Guarantee Obligation
shall not include endorsements of instruments for deposit or collection in the
ordinary course of business.  The amount
of any Guarantee Obligation of any guaranteeing person shall be deemed to be
the maximum stated amount of the primary obligation relating to such Guarantee
Obligation (or, if less, the maximum stated liability set forth in the
instrument embodying such Guarantee Obligation); provided, however,
that in the absence of any such stated amount or stated liability, the amount
of such Guarantee Obligation shall be such guaranteeing person’s maximum
reasonably anticipated liability in respect thereof as reasonably determined by
such Person in good faith.


 


17

















 


“Guarantor”
shall mean, individually and/or collectively, Northstar Corp, Northstar LP and
any other entity that becomes party to this Agreement pursuant to Section 5.10
from time to time, in each case together with their successors and permitted
assigns.


 


“Guarantor Joinder Agreement” shall mean a Guarantor Joinder
Agreement in substantially the form of Exhibit 1.1(d)(ii), executed
and delivered by an Additional Credit Party in accordance with the provisions
of Section 5.10, as amended, modified, extended, restated, replaced, or
supplemented from time to time in accordance with its terms.


 


“Guaranty”
shall mean the guaranty of the Guarantors set forth in that certain First
Amended and Restated Guaranty Agreement, dated as of the date hereof, by and
among the Guarantors and the Administrative Agent, as amended, modified,
extended, restated, replaced, or supplemented from time to time in accordance
with its terms.


 


“Holdings” shall have the meaning set forth in the first
paragraph of this Agreement.


 


“Holdings II” shall have the meaning set forth in the first
paragraph of this Agreement.


 


“Holdings VII” shall have the meaning set forth in the first
paragraph of this Agreement.


 


“Holdings X” shall have the meaning set forth in the first
paragraph of this Agreement.


 


“Holdings XII” shall have the meaning set forth in the first
paragraph of this Agreement.


 


“Income”
shall mean with respect to the Collateral  and to the
extent of a Borrower’s or the holder’s interest therein, at any time, all of
the following:  all payments,
collections, prepayments, recoveries, proceeds (including, without limitation,
insurance and condemnation proceeds), Extraordinary Receipts and all other
payments or amounts of any kind or nature whatsoever paid, received, collected,
recovered or distributed on, in connection with or in respect of the Collateral
or any other collateral for the Obligations, including, without limitation,
principal payments, interest payments, principal and interest payments,
prepayment fees, extension fees, exit fees, defeasance fees, transfer fees,
late charges, late fees and all other fees or charges of any kind or nature,
premiums, yield maintenance charges, penalties, default interest, dividends,
gains, receipts, allocations, rents, interests, profits, payments in kind,
returns or repayment of contributions and all other distributions, payments and
other amounts of any kind or nature whatsoever payable thereon, in connection
therewith, or with respect thereto, together with any amounts received from any
Interest Rate Protection Agreement; provided, however, Income
shall not include any Obligor Reserve Payments unless a Borrower, a Servicer or
a PSA Servicer has exercised rights with respect to such payments under the
terms of the related Mortgage Loan Documents, the Servicing Agreements or the
Pooling and Servicing Agreements, as applicable.


 


“Indebtedness”
shall mean with respect to any Person and its Consolidated Subsidiaries
determined on a consolidated basis, at the time of computation thereof, all of
the following (without duplication):  (a) all
obligations of such Person in respect of money borrowed (including, without
limitation, principal, interest, assumption fees, prepayment fees, yield
maintenance charges, penalties, contingent interest and all other monetary
obligations whether choate or inchoate); (b) all obligations of such
Person, whether or not for money borrowed (i) represented by notes
payable, letters of credit, or drafts accepted, in each case representing
extensions of credit, (ii) evidenced by bonds, debentures, notes or
similar instruments, (iii) constituting purchase money indebtedness,
conditional sales contracts, title retention debt instruments or other similar
instruments, upon which interest charges are customarily paid or that are
issued or assumed as full or partial payment for property or services rendered
or (iv) in connection with the issuance of preferred equity or trust
preferred securities; (c) Capital Lease 


 


18

















 


Obligations
of such Person; (d) all Off—Balance Sheet Obligations of such Person
(other than non—recourse indebtedness incurred in connection with any CDO
Securitization Transaction); (e) all obligations of such Person to
purchase, redeem, retire, defease or otherwise make any payment in respect of
any Mandatory Redeemable Stock issued by such Person or any other Person
(inclusive of forward equity contracts), valued at the greater of its voluntary
or involuntary liquidation preference plus accrued and unpaid dividends; (f) as
applicable, all obligations of such Person (but not the obligation of others)
in respect of any keep well arrangements, credit enhancements, contingent or
future funding obligations under any Mortgage Asset or any obligation senior to
the Mortgage Asset, unfunded interest reserve amount under any Mortgage Asset
or any obligation that is senior to the Mortgage Asset, purchase obligation,
repurchase obligation, takeout commitment or forward equity commitment, in each
case evidenced by a binding agreement (excluding any such obligation to the
extent the obligation can be satisfied by the issuance of Equity Interest
(other than Mandatory Redeemable Stock)); (g) net obligations under any
Derivative Contract not entered into as a hedge against existing indebtedness,
in an amount equal to the Derivatives Termination Value thereof; (h) all
indebtedness of other Persons which such Person has guaranteed or is otherwise
recourse to such Person (except for guaranties of customary exceptions for
fraud, misapplication of funds, environmental indemnities and other similar
exceptions to recourse liability (including exceptions relating to bankruptcy,
insolvency, receivership or other similar events)); (i) all indebtedness
of another Person secured by (or for which the holder of such Indebtedness has
an existing right, contingent or otherwise, to be secured by) any Lien (other
than certain Permitted Liens) on Property or assets owned by such Person, even
though such Person has not assumed or become liable for the payment of such
indebtedness or other payment obligation; provided, however, if
such Person has not assumed or become liable for the payment of such
indebtedness, then for the purposes of this definition the amount of such indebtedness
shall not exceed the market value of the property subject to such Lien and (j) Contingent
Liabilities.


 


“Indemnified
Amounts” shall have the meaning set forth in Section 10.5(b).


 


“Indemnified Taxes” shall mean Taxes other than Excluded Taxes.


 


“Indemnitee” shall have the meaning set forth in Section 10.5(b).


 


“Independent
Director” shall mean a natural Person who (a) is not, at the time of
initial appointment as Independent Director, and may not have been at any time
during the five (5) years preceding such initial appointment or at
any time while serving as Independent Director, (i) a stockholder,
partner, member or direct or indirect legal or beneficial owner of a Borrower,
a Guarantor or any Subsidiary or Affiliate of any Credit Party; (ii) a contractor,
creditor, customer, supplier, director (with the exception of serving as the
Independent Director of a Borrower), officer, employee, attorney, manager or
other Person who derives any of its purchases or revenues from its activities
with a Borrower, a Guarantor or any Affiliate or Subsidiary of any Credit
Party; (iii) a natural Person who controls (directly or indirectly or
otherwise) a Borrower, a Guarantor or any Affiliate or Subsidiary of any Credit
Party or who controls or is under common control with any Person that would be
excluded from serving as an Independent Director under (i) or (ii), above;
or (iv) a member of the immediate family of a natural Person excluded from
serving as an Independent Director under clauses (i) or (ii) above, (b) is
an employee of a nationally recognized organization that supplies independent
directors and (c) otherwise satisfies the then current requirements of the
Rating Agencies.  A Person who is an
employee of a nationally recognized organization that supplies independent
directors and who otherwise satisfies the criteria in clause (a) but
for the fact that such organization receives payment from a Borrower or a
Guarantor for providing such independent director shall not be disqualified
from serving as an Independent Director hereunder.


 


“Information
Materials” shall have the meaning set forth in Section 5.15.


 


19














 


“Insolvency” shall mean, with respect to any Multiemployer Plan,
the condition that such Plan is insolvent within the meaning of such term as
used in Section 4245 of ERISA.


 


“Insolvency
Event” shall mean, with respect to a specified Person, (a) the filing
of a decree or order for relief by a court having jurisdiction in the premises
in respect of such Person or any substantial part of its Property in an
involuntary case under any applicable Insolvency Law now or hereafter in
effect, or appointing a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official for such Person or for any substantial part of
its Property, or ordering the winding-up or liquidation of such Person’s
affairs, and such decree or order shall remain unstayed and in effect for a
period of sixty (60) consecutive days; or (b) the commencement by
such Person of a voluntary case under any applicable Insolvency Law now or
hereafter in  effect, or the consent by such
Person to the entry of an order for relief in an involuntary case under any
such law, or the consent by such Person to the appointment of or taking
possession by a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official for such Person or for any substantial part of
its Property, or the making by such Person of any general assignment for the
benefit of creditors, or the failure by such Person generally to pay its debts
as such debts become due, or the taking of action by such Person in furtherance
of any of the foregoing.


 


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


 


“Insolvency
Proceeding” shall mean any case, action or proceeding before any court or
other Governmental Authority relating to any Insolvency Event.


 


“Instrument” shall mean any “instrument” (as defined in Article 9
of the UCC), other than an instrument that constitutes part of chattel paper.


 


“Intercreditor Agreement” shall mean that certain Intercreditor
Agreement to be entered into by and among the Administrative Agent and Wachovia
Bank (London Branch), as purchaser under the Reindeer Facility, as amended,
modified, extended, restated, replaced, or supplemented from time to time in
accordance with its terms.


 


“Interest
Expense” shall mean for any period and any Person, total interest expense,
of such Person for such period with respect to all outstanding Indebtedness of
such Person (including, without limitation, all commissions, discounts and
other fees and charges owed with respect to letters of credit and bankers’
acceptance financing and net costs under interest rate protection agreements),
determined in accordance with GAAP, excluding amortization of deferred
financing fees and amortization of bond discounts associated with convertible
debt to the extent included in GAAP Interest Expense.


 


“Interest Period”
shall mean, with respect to any LIBOR Rate Loan,


 


(a)           initially, the
period commencing on the Borrowing Date or conversion date, as the case may be,
with respect to such LIBOR Rate Loan and ending one, two, three or six months
thereafter, subject to availability to all applicable Lenders, as selected by
Borrowers in the Notice of Borrowing or Notice of Conversion given with respect
thereto; and


 


(b)           thereafter,
each period commencing on the last day of the immediately preceding Interest
Period applicable to such LIBOR Rate Loan and ending one, two, three or six
months thereafter, subject to availability to all applicable Lenders, as
selected by the Borrowers by 


 


20

















 


irrevocable notice to the Administrative Agent not less than three
Business Days prior to the last day of the then current Interest Period with
respect thereto; provided that the foregoing provisions are subject to
the following:


 


(i)            if any Interest
Period pertaining to a LIBOR Rate Loan would otherwise end on a day that is not
a Business Day, such Interest Period shall be extended to the next succeeding
Business Day unless the result of such extension would be to carry such
Interest Period into another calendar month in which event such Interest Period
shall end on the immediately preceding Business Day;


 


(ii)           any Interest
Period pertaining to a LIBOR Rate Loan that begins on the last Business Day of
a calendar month (or on a day for which there is no numerically corresponding
day in the calendar month at the end of such Interest Period) shall end on the
last Business Day of the relevant calendar month;


 


(iii)          if the
Borrowers shall fail to give notice of the applicable Interest Period, in any
Notice of Borrower or otherwise, the applicable Borrower shall be deemed to
have selected a one-month LIBOR Rate Loan;


 


(iv)          no Interest
Period in respect of any Loan shall extend beyond the applicable Maturity Date
and, further with regard to the Term Loan, no Interest Period shall extend
beyond any principal amortization payment date with respect to such Term Loan
unless the portion of such Term Loan consisting of Alternate Base Rate Loans
together with the portion of such Term Loan consisting of LIBOR Rate Loans with
Interest Periods expiring prior to or concurrently with the date such principal
amortization payment date is due, is at least equal to the amount of such
principal amortization payment due on such date; and


 


(v)           no more than
six (6) LIBOR Rate Loans may be in effect at any time.  For purposes hereof, LIBOR Rate Loans with
different Interest Periods shall be considered as separate LIBOR Rate Loans,
even if they shall begin on the same date and have the same duration, although
borrowings, extensions and conversions may, in accordance with the provisions
hereof, be combined at the end of existing Interest Periods to constitute a new
LIBOR Rate Loan with a single Interest Period.


 


“Interest
Rate Protection Agreement” shall mean with respect to any or all of the
Mortgage Assets, (a) any Derivatives Contract required under the terms of
the related Mortgage Loan Documents providing for protection against
fluctuations in interest rates or the exchange of nominal interest obligations,
either generally or under specific contingencies, and acceptable to the
Administrative Agent in its discretion and (b) any Derivatives Contract
put in place by any Borrower, any Guarantor or any Subsidiary or Affiliate of
the foregoing with respect to any Mortgage Asset, as the same may be amended,
restated, modified or supplemented from time to time.


 


“Investment”
shall mean, with respect to any Person, any acquisition or investment (whether
or not of a controlling interest) by such Person, whether by means of (a) the
purchase or other acquisition of any Equity Interests in another Person, (b) a
loan, advance or extension of credit to, capital contribution to, guaranty or
credit enhancement of Indebtedness of, or purchase or other acquisition of any
Indebtedness of, another Person, including any partnership or joint venture
interest in such other Person, or (c) the purchase or other acquisition
(in one transaction or a series of transactions) of assets of another Person
that constitute the business or a division or operating unit of another
Person.  Any binding commitment or option
to make an Investment in any other Person shall constitute an Investment.  Except 


 


21

















 


as
expressly provided otherwise, for purposes of determining compliance with any
covenant contained in the Credit Documents, the amount of any Investment shall
be the amount actually invested, without adjustment for subsequent increases or
decreases in the value of such Investment.


 


“Irrevocable
Instruction” shall mean an irrevocable instruction letter in the form
of Exhibit 1.1(j) hereto duly executed by the applicable
Credit Party, as amended, modified, extended, restated, replaced, or
supplemented from time to time in accordance with its terms.


 


“Joinder Agreement” shall mean a Borrower Joinder Agreement
and/or a Guarantor Joinder Agreement, as applicable, as each may be amended,
restated, supplemented or modified from time to time.


 


“Junior
Interest” shall mean (a) a senior, pari passu or junior participation
interest in a performing Commercial Real Estate Loan or (b) a senior, pari
passu or junior note or certificate in an “A/B” or similar structure in a
performing Commercial Real Estate Loan, in each case where the Underlying
Mortgaged Property is stabilized and non-transitional.


 


“Junior
Interest Document” shall mean the original executed promissory note,
Participation Certificate, Participation Agreement and any other evidence of a
Junior Interest, as applicable, as the same may be amended, restated, modified
or supplemented from time to time.


 


“Lender” shall have the meaning set forth in the first paragraph
of this Agreement and shall include the Revolving Lenders and the Term Loan
Lenders.


 


“Lender Commitment Letter” shall mean, with respect to any
Lender, the letter (or other correspondence) to such Lender from the
Administrative Agent notifying such Lender of its Revolving Commitment
Percentage and its portion of the Commitment Fee and/or Term Loan Commitment
Percentage, as applicable.


 


“Lender Consent” shall mean any lender consent delivered by a
Lender on the Restatement Date in the form of Exhibit 4.1(a).


 


“LIBOR” shall mean, for any LIBOR Rate Loan for any Interest
Period therefor, the rate per annum (rounded upwards, if necessary, to the
nearest 1/100 of 1%) appearing on Reuters Screen LIBOR01 Page (or any
successor page) as the London interbank offered rate for deposits in Dollars at
approximately 11:00 A.M. (London time) two (2) Business Days
prior to the first day of such Interest Period for a term comparable to such
Interest Period.  If for any reason such
rate is not available, then “LIBOR” shall mean the rate per annum at which, as
determined by the Administrative Agent in accordance with its customary
practices, Dollars in an amount comparable to the Loans then requested are
being offered to leading banks at approximately 11:00 a.m. London time,
two (2) Business Days prior to the commencement of the applicable
Interest Period for settlement in immediately available funds by leading banks
in the London interbank market for a period equal to the Interest Period
selected.


 


“LIBOR Lending Office” shall mean, initially, the office(s) of
each Lender designated as such Lender’s LIBOR Lending Office in such Lender’s
Administrative Questionnaire; and thereafter, such other office of such Lender
as such Lender may from time to time specify to the Administrative Agent and
the Borrowers as the office of such Lender at which the LIBOR Rate Loans of
such Lender are to be made.


 


22

















 


“LIBOR Rate” shall mean a LIBOR rate per annum (rounded upwards,
if necessary, to the next higher 1/100th of 1%) determined by the
Administrative Agent in accordance with the definition of “LIBOR”.


 


“LIBOR Rate Loan” shall mean Loans the rate of interest
applicable to which is based on the LIBOR Rate.


 


“Lien” shall mean any mortgage, pledge, hypothecation,
assignment, deposit arrangement, encumbrance, lien (statutory or other), charge
or other security interest or any 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 Capital Lease having substantially the same economic effect
as any of the foregoing).


 


“Loan” shall mean a Revolving Loan, Delayed Draw Term Loan
and/or the Term Loan, as appropriate.


 


“Loan–to–Value
Ratio” or “LTV” shall mean with respect to any Mortgage Asset (other
than any CMBS Security), as applicable, as of any date of determination, the
ratio of the outstanding principal amount of such Mortgage Asset to the market
value of the related Underlying Mortgaged Property at such time, (i) in
connection with the initial finance of a Mortgage Asset under the Revolving
Loans only and to the extent a Current Appraisal is available, based on the
Current Appraisal, as the LTV may be adjusted by the Administrative Agent as
the Administrative Agent determines in its discretion, and, (ii) in all
other cases, as the Administrative Agent may determine in its discretion based
on such sources of information as the Administrative Agent may determine to
rely on in its discretion; provided, however, that all such
calculations shall be made taking into account any senior or pari passu debt or other obligations, including debt or
other obligations secured directly or indirectly by the applicable Underlying
Mortgaged Property.


 


“LTC”
shall mean, with respect to any Mortgage Asset that is a Bridge Loan or a
Construction Loan, as of any date of determination, the ratio of the
outstanding principal amount of such Mortgage Asset to the Construction Costs
for such Mortgage Asset; provided, however, that all such
calculations shall be made taking into account any senior or pari passu debt or other obligations including debt or other
secured directly or indirectly by the applicable Underlying Mortgaged Property.


 


“Main
Treasury Account” shall have the meaning set forth in Section 5.29.


 


“Mandatory
Redeemable Stock” shall mean, with respect to any Person and any Subsidiary thereof, any Equity Interests of
such Person which by the terms of such Equity Interests (or by the terms of any
security into which it is convertible or for which it is exchangeable or
exercisable), upon the happening of any event or otherwise (a) matures or
is required to be redeemed, pursuant to a sinking fund obligation or otherwise
(other than an Equity Interest to the extent redeemable in exchange for common
stock or other equivalent common Equity Interests), (b) is convertible
into or exchangeable or exercisable for Indebtedness or Mandatory Redeemable
Stock, or (c) is redeemable at the option of the holder thereof, in whole
or in part (other than an Equity Interest which is redeemable solely in
exchange for common stock or other equivalent common Equity Interests); in the
case of each clause (a) through (c), on or prior to the Maturity
Date.


 


“Market
Value” shall mean, as of any date of determination in respect of any
Mortgage Asset, the price at which such Mortgage Asset could readily be
sold, as determined by the Administrative Agent in its discretion based on
such sources and information (if any) as the Administrative Agent may
determine 


 


23

















 


to
rely on in its discretion (which value may be determined to be zero (0)), as
such Market Value may be adjusted at any time by the Administrative
Agent as the Administrative Agent determines in its discretion.


 


“Material
Adverse Effect” shall mean, a material adverse effect on (a) the
financial condition or credit quality of the Borrowers (taken as a whole) or
any Guarantor, (b) the ability of any Credit Party to perform its
obligations under any Credit Document or Mortgage Loan Document to which it is
a party, (c) the validity or enforceability of any of the Credit
Documents, (d) the rights and remedies of the Administrative Agent or the
Lenders, (e) the timely payment of any amounts payable under the Credit
Documents or Mortgage Loan Documents or (f) the Asset Value of the Pledged
Mortgage Assets; provided, however, the occurrence of an event
under clause (e) or (f) of this definition of Material Adverse Effect
shall not, in and of itself, constitute an Event of Default under Section 7.1(e),
but such occurrence may be or form the basis for an Event of Default under
other provisions of Section 7.1 other than Section 7.1(e).


 


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


 


“Maturity
Date” shall mean the Revolver Maturity Date and/or the Term Loan Maturity
Date, as applicable.


 


“Maximum
LTC” shall mean, in the case of Revolving Loan Collateral under the
Revolving Loans, the Maximum LTC set forth in the related Confirmation, which
shall be no greater than the Maximum LTC set forth in Schedule 1-C to
the Fee Letter; provided, however, that all such calculations
shall be made taking into account any senior or pari passu
debt or other obligations, including debt or other obligations secured directly
or indirectly by the applicable Underlying Mortgaged Property.


 


“Maximum
LTV” shall mean, in the case of Revolving Loan Collateral under the
Revolving Loans (other than any CMBS Security), the Maximum LTV set forth in
the related Confirmation, which shall be no greater than the Maximum LTV set
forth in Schedule 1-C to the Fee Letter; provided, however,
the Maximum LTV shall take into account any senior or pari passu
debt or other obligations, including debt or other obligations secured directly
or indirectly by the applicable Underlying Mortgaged Property.


 


“Mezzanine
Loan” shall mean a performing mezzanine loan secured by pledges of all (or,
in the Administrative Agent’s discretion, less than all) the Equity Interest of
the Person that owns, directly or indirectly, income producing Underlying
Mortgaged Property that is stabilized and non-transitional.


 


“Mezzanine
Note” shall mean the original executed promissory note or other evidence of
Mezzanine Loan Indebtedness, as the same may be amended, restated, modified or
supplemented from time to time.


 


“Minimum
DSCR” shall mean, in the case of Revolving Loan Collateral under the
Revolving Loans (other than any CMBS Security), the Minimum DSCR set forth in
the related Confirmation, which shall be no less than the Minimum DSCR set
forth in Schedule 1-C to the Fee Letter; provided, however,
that all such calculations shall be made taking into account any senior or pari passu debt or other obligations, including debt or
other obligations secured directly or indirectly by the applicable Underlying
Mortgaged Property.


 


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


 


24

















 


“Mortgage”
shall mean each mortgage, assignment of rents, security agreement and fixture
filing, or deed of trust, assignment of rents, security agreement and fixture
filing, or similar instrument creating and evidencing a Lien on real property,
fixtures and other Property and rights incidental thereto, as the same may be
amended, restated, modified or supplemented from time to time.


 


“Mortgage
Asset” shall mean a Whole Loan, a Junior Interest, a Mezzanine Loan, a
Bridge Loan, a CMBS Security, a CTL Loan, a Subordinate CTL Loan, Senior
Secured Bank Debt or a Preferred Equity Interest, (i) the Underlying
Mortgaged Property for which is included in the categories for Property Types
of Mortgage Assets; provided, however, the portion of any
Mortgage Asset to be pledged to the Administrative Agent shall not include any
Retained Interest (if any) (unless approved by the Administrative Agent in its
discretion).


 


“Mortgage
Asset Data Summary” shall have the meaning set forth in Section 5.2(f).


 


“Mortgage
Asset File” shall have the meaning set forth in the Custodial Agreement.


 


“Mortgage
Asset File Checklist” shall have the meaning set forth in the Custodial
Agreement.


 


“Mortgage
Asset Security Agreement” shall mean, with respect to any Mortgage Asset,
any contract, instrument or other document related to security for repayment
thereof (other than the related Mortgage, Mortgage Note, Mezzanine Note or any
other note, certificate or instrument) executed by an Obligor and/or others in
connection with such Mortgage Asset, including, without limitation, any
security agreement, UCC financing statement, Liens, warranties, guaranty, title
insurance policy, hazard insurance policy, chattel mortgage, letter of credit,
accounts, bank accounts or certificates of deposit or other pledged accounts,
and any other documents and records relating to any of the foregoing, as the
same may be amended, restated, modified or supplemented from time to time.


 


“Mortgage
Loan Documents” shall have the meaning set forth in the Custodial
Agreement.


 


“Mortgage
Note” shall mean, that certain original executed promissory note or other
evidence of the Indebtedness of an Obligor under a Whole Loan which is secured
by a Mortgage on the related Underlying Mortgaged Property, as the same may be
amended, restated, modified or supplemented from time to time.


 


“Mortgaged
Property” shall mean the Commercial Real Estate (including all
improvements, buildings, fixtures, building equipment and personal property
thereon and all additions, alterations and replacements made at any time with
respect to the foregoing and any Credit Tenant Lease to which such real
property is subject) and all other collateral securing repayment of the related
debt evidenced by the Mortgage Loan Documents.


 


“Mortgagee”
shall mean the record holder of a Mortgage Note secured by a Mortgage.


 


“Multiemployer
Plan” shall mean a Plan that is a multiemployer plan as defined in Section 4001(a)(3) of
ERISA.


 


“Net
Cash Flow” shall mean with respect to any Underlying Mortgaged Property,
for any period, the net income (or deficit) attributable to such Underlying
Mortgaged Property for such period, determined in accordance with GAAP (and if
such Property is subject to a Credit Tenant Lease, the net rents paid during
such period under such lease), less the amount of all (a) capital
expenditures incurred, (b) reserves established, (c) leasing
commissions paid (other than commissions paid from reserves held 


 


25

















 


under
the Mortgage Loan Documents) and (d) tenant improvements paid during such
period (other than tenant improvements paid from reserves held under the
Mortgage Loan Documents) in each case attributable to such Underlying Mortgaged
Property plus all non–cash charges deducted in the calculation of such
net income.


 


“Net
Cash Proceeds” shall mean the aggregate cash proceeds, Cash Equivalents and
the Fair Market Value of all other Property and assets received by, or payable
to, any Credit Party or any Subsidiary or Affiliate in respect of any Equity
Issuance, Debt Issuance or sale or other disposition of any Collateral, net of (a) direct
costs (including, without limitation, legal, accounting and investment banking
fees, and sales commissions) associated therewith, and (b) taxes paid or
payable as a result thereof; it being understood that “Net Cash Proceeds” shall
include, without limitation, any cash received upon the sale or other
disposition of any non-cash consideration received by any Credit Party, any
Subsidiary or any Affiliate in any Equity Issuance, Debt Issuance or sale or
other disposition of any Collateral.  For
the avoidance of doubt, any non-cash proceeds received in respect of any Equity
Issuance, Debt Issuance or sale or other disposition of any Collateral shall be
payable as “Net Cash Proceeds” at such time as those proceeds are monetized.


 


“Net
Cash Proceeds Payments” shall mean the Equity Net Cash Proceeds Payments
and the Debt Net Cash Proceeds Payments.


 


“Net
Income” shall mean, with respect to any Person and its Consolidated
Subsidiaries for any period, the net income of such Person and its Consolidated
Subsidiaries determined on a consolidated basis for such period as determined
in accordance with GAAP.


 


“Non-Recourse
Indebtedness” shall mean, with respect to any Person, Indebtedness for
borrowed money in respect of which recourse for payment (except for customary
exceptions for fraud, misapplication of funds, environmental indemnities, and
other similar exceptions to non-recourse provisions (including exceptions
relating to bankruptcy, insolvency, receivership, non-approved transfers or
other customary or similar events)) is contractually limited to specific assets
of such Person encumbered by a Lien securing such Indebtedness.


 


“Non–Table
Funded Mortgage Asset” shall mean a Mortgage Asset that is not a Table
Funded Mortgage Asset.


 


“Non–Wachovia
Assets” shall mean any Mortgage Asset issued, extended or originated by a
Person other than Wachovia Corporation or an Affiliate of Wachovia Corporation.


 


“Northstar Corp” shall have the meaning set forth in the first
paragraph of this Agreement.


 


“Northstar LP” shall have the meaning set forth in the first
paragraph of this Agreement.


 


“Note”
or “Notes” shall mean the Revolving Notes and/or the Term Loan Notes,
collectively, separately or individually, as appropriate, as any shall be
amended, restated, modified or supplemented from time to time.


 


“Note
Purchase Margin” shall mean the difference between the Note Purchase Price
and the Note Purchase Price that would be outstanding if an 80% Advance Rate
(as defined in the Reindeer Facility) were in effect under the Reindeer
Facility, as determined by the Administrative Agent on at least a weekly basis
and as converted by the Administrative Agent in its discretion to Dollars.


 


26

















 


“Note
Purchase Price” shall mean the Purchase Price (as defined in the Reindeer
Facility) outstanding under the Reindeer Facility.


 


“Notice of Borrowing” shall mean a request for a Loan pursuant
to this Agreement as amended, modified, extended, restated, replaced, or
supplemented from time to time in accordance with its terms.  A Form of Notice of Borrowing is
attached as Exhibit 1.1(e).


 


“Notice of Conversion/Extension” shall mean the written notice
of conversion of a LIBOR Rate Loan to an Alternate Base Rate Loan or an
Alternate Base Rate Loan to a LIBOR Rate Loan, or extension of a LIBOR Rate
Loan, in each case substantially in the form of Exhibit 1.1(f).


 


“Obligations”
shall mean, without duplication, all of the obligations, indebtedness and
liabilities of the Credit Parties to the Lenders and the Administrative Agent,
whenever arising, under the Loans, this Agreement, the Notes, any of the other
Credit Documents and all of the Credit Party-Related Obligations, including
principal, interest, fees, reimbursements and indemnification obligations and
other amounts (including, but not limited to, any interest accruing after the
occurrence of a filing of a petition of bankruptcy under the Bankruptcy Code
with respect to any Credit Party, regardless of whether such interest is an
allowed claim under the Bankruptcy Code).


 


“Obligor” shall mean, individually and collectively, as the
context may expressly provide or require, the borrowers, mortgagors, obligors
or debtors under a Mortgage Asset, including, but not limited to, any
guarantor, any pledgor, any subordinator, any credit support party, any
indemnitor and any Person that is directly or indirectly obligated in respect
thereof, the borrowers, mortgagors, obligors or debtors of any debt, including
any guarantor, any pledgor, any subordinator, any credit support party, any
indemnitor and any Person that is directly or indirectly obligated in respect
thereof, senior to the Mortgage Asset, including any of the foregoing such
Persons with respect to the debt secured by any Underlying Mortgaged Property,
and any Person that has not signed the related Mortgage Note, Junior Interest
Documents, Mezzanine Note or other note, certificate or instrument but owns an
interest in the related Underlying Mortgaged Property, which interest has been
encumbered to secure such Mortgage Asset.


 


“Obligor Reserve Payments” shall mean any payments made by an
Obligor under the applicable Mortgage Loan Documents which, pursuant to the
terms of such Mortgage Loan Documents, are required to be deposited into escrow
or into a reserve to be used for a specific purpose (e.g., tax and insurance
escrows).


 


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


 


“Off–Balance
Sheet Assets” shall mean, with respect to any Person, any asset that is
subject to an off—balance sheet financing, and as a result of such transaction
such asset does not (and is not required pursuant to GAAP) to appear as an
asset on the balance sheet of such Person.


 


“Off–Balance
Sheet Liabilities” shall mean, with respect to any Person, any (a) repurchase
obligation or liability, contingent or otherwise, of such Person with respect
to any mortgages, mortgage notes, accounts or notes receivable sold,
transferred or otherwise disposed of by such Person, (b) repurchase
obligation or liability, contingent or otherwise, of such Person with respect
to Property or assets leased by such Person as lessee and (c) obligations,
contingent or otherwise, of such Person under any Off—Balance Sheet
Transaction, in each case, if the transaction giving rise to such obligation (i) is
considered Indebtedness for borrowed money for tax purposes, and (ii) does
not (and is not required pursuant to GAAP) to appear as a liability on the
balance sheet of such Person.


 


27

















 


“Off-Balance Sheet Obligations” shall mean,
with respect to any Person and its Consolidated Subsidiaries determined on a
consolidated basis, as of any date of determination thereof, without
duplication and to the extent not included as a liability on the consolidated
balance sheet of such Person and its Consolidated Subsidiaries in accordance
with GAAP:  (a) the monetary
obligations under any financing lease or so-called “synthetic”, tax retention
or off-balance sheet lease transaction which, upon the application of any
Insolvency Laws to such Person or any of its Consolidated Subsidiaries, would
be characterized as indebtedness; (b) the monetary obligations under any
sale and leaseback transaction which does not create a liability on the
consolidated balance sheet of such Person and its Consolidated Subsidiaries; or
(c) any other monetary obligation arising with respect to any other
transaction which (i) is characterized as indebtedness for tax purposes
but not for accounting purposes in accordance with GAAP or (ii) is the
functional equivalent of or takes the place of borrowing but which does not
constitute a liability on the consolidated balance sheet of such Person and its
Consolidated Subsidiaries (for purposes of this clause (c), any
transaction structured to provide tax deductibility as interest expense of any
dividend, coupon or other periodic payment will be deemed to be the functional
equivalent of a borrowing).


 


“Off–Balance
Sheet Transaction” shall mean, with respect to any Person, any synthetic
lease, tax retention operating lease, commercial mortgage backed securities
transaction, securitization transaction, collateralized debt obligation
transaction, off balance sheet loan or similar off balance sheet financing.


 


“Officer’s
Certificate” shall mean, a certificate signed by a Responsible Officer of a
Borrower or a Guarantor, as applicable.


 


“Operating
Company” shall mean an “operating company” within the meaning of 29 C.F.R.
2510.3-101(c) of the regulations of the U.S. Department of Labor.


 


“Opinion
of Counsel” shall mean, a written opinion of counsel, which opinion and
counsel are acceptable to the Administrative Agent in its reasonable
discretion.


 


“Original
Agreement” shall have the meaning set forth in the Recitals hereto.


 


“Originator”
shall mean, with respect to each Mortgage Asset, the Person who originated such
Mortgage Asset.


 


“Other
Credit Facilities” shall mean any warehouse, repurchase, loan or credit
facility provided by a national banking association or any syndicate thereof
(or any other financial institution approved by the Administrative Agent in its
reasonable discretion) to a Guarantor or any Affiliate or Subsidiary of a
Guarantor.


 


“Other Taxes” shall mean all present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies arising from any payment made hereunder or under any other Credit Document
or from the execution, delivery or enforcement of, or otherwise with respect
to, this Agreement or any other Credit Document.


 


“Participant” has the meaning assigned to such term in
clause (d) of Section 10.6.


 


“Participation
Agreement” shall mean, with respect to any Junior Interest, any executed
participation agreement, sub—participation agreement, intercreditor, servicing
or administrative agreement or any agreement that is similar to any of the
foregoing agreements under which the Junior Interest is 


 


28

















 


created,
evidenced, issued, serviced, administered and/or guaranteed, as the same may be
amended, restated, modified or supplemented from time to time.


 


“Participation
Certificate” shall mean, with respect to any Junior Interest, an executed
certificate, note, instrument or other document representing the interest,
participation interest or sub—participation interest granted under a
Participation Agreement, as the same may be amended, restated, modified or
supplemented from time to time.


 


“Patriot Act” shall mean The Uniting and Strengthening America
by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act
of 2001 (Title III of Pub. L. No. 107-56 (signed into law October 26,
2001)), as amended, restated modified or supplemented from time to time.


 


“paying
Borrower” shall have the meaning set forth in Section 10.29(b).


 


“Payment
Date” shall mean (a) the 1st day of each calendar month; provided,
however, if such day is not a Business Day, if the next Business Day
does not occur during the succeeding month, the next succeeding Business Day
and (b) as to any Loan which is the subject of a mandatory prepayment
required pursuant to Section 2.5(b), the date on which such mandatory
prepayment is due.


 


“PBGC” shall mean the Pension Benefit Guaranty Corporation
established pursuant to Subtitle A of Title IV of ERISA.


 


“Permitted
Indebtedness” shall mean, with respect to Preferred Equity Interests or
Indebtedness that is permitted under the related Mortgage Loan Documents and
disclosed in writing to the Administrative Agent in a Confirmation.


 


“Permitted
Liens” shall mean any of the following as to which no enforcement,
collection, execution, levy or foreclosure proceeding shall have been commenced:  (a) Liens for state, municipal or other
local Taxes if such Taxes shall not at the time be due and payable, (b) Liens
imposed by Requirements of Law, such as materialmen’s, mechanics’, carriers’,
workmen’s and repairmen’s Liens and other similar Liens, arising in the
ordinary course of business securing obligations that are not overdue for a
period of more than thirty (30) days, (c) Liens granted pursuant to
or by the Security Documents, and (d) in the case of the Mortgage Assets
only and not any Borrower’s interest therein, with respect to any Underlying
Mortgaged Property, Liens which are permitted pursuant to the terms of the
Mortgage Loan Documents.


 


“Person” shall mean any natural person, corporation, limited
liability company, trust, joint venture, association, company, partnership,
Governmental Authority or other entity.


 


“Plan” shall mean any
plan, including single employer and multi—employer plans, to which section 4021(a) of
ERISA applies or any retirement medical plan, each as established or maintained
for employees of any Credit Party or any ERISA Affiliate of any Credit Party to
which Section 4021(a) of ERISA applies.


 


“Plan Asset Regulations”
shall mean 29 C.F.R. 2510.3-101, et. seq.


 


“Plan Assets” shall
mean “Plan assets” within the meaning of the Plan Asset Regulations.


 


“Pledge Agreements” shall mean each of the Pledge and Security
Agreement and the Preferred Equity Pledge and Security Agreement, as each such
agreement may be amended, modified, restated or supplemented from time to time.


 


29














 


“Pledge
and Security Agreement” shall mean the First Amended and Restated Pledge
and Security Agreement, dated as of the date hereof, between the Administrative
Agent, the Pledgor, the Guarantors and the other parties from time to time
party thereto, as amended, modified, extended, restated, replaced, or
supplemented from time to time in accordance with its terms.


 


“Pledged
Collateral” shall have the meaning given to such term in the Pledge and
Security Agreement.


 


“Pledged
Mortgage Asset” shall mean the Mortgage Assets that have been pledged to
the Administrative Agent as Collateral under the Security Documents.


 


“Pledgor”
shall mean NRFC Sub-REIT Corp., a Maryland corporation, together with its
successors and assigns.


 


“Pooling
and Servicing Agreements” shall mean any and all pooling and servicing
agreements, trust agreements or indentures governing servicing and other
matters entered into in connection with (a) a CMBS Security or (b) a
securitization of one (1) or more interests that are senior, junior
or pari passu with a Mortgage Asset, as the
same may be amended, restated, modified or supplemented from time to time.


 


“Preferred
Equity Grantor” shall mean the entity in which a Preferred Equity Interest
represents an Investment.


 


“Preferred
Equity Interest” shall mean all (or, if approved by the Administrative
Agent in its discretion, less than all) of the Equity Interests representing
the preferred equity interest in an entity that owns, directly or indirectly,
stabilized and non-transitional Commercial Real Estate, including, but not
limited to, all equity interests representing a dividend on any of the Equity
Interests of the Preferred Equity Grantor or representing a distribution or
return of capital upon or in respect of the Equity Interests of the Preferred
Equity Grantor, in each case as it relates to a Preferred Equity Interest; provided,
however, (a) such Preferred Equity Interest must contain a
synthetic maturity feature acceptable to the Administrative Agent in its
discretion, (b) the funding of the Preferred Equity Interest is subject to
regulatory and compliance criteria, (c) the Preferred Equity Interest is
structured so as to avoid consolidation of the Preferred Equity Interest and
the other equity interests in the Preferred Equity Grantor, as required by
customary legal and GAAP accounting requirements applicable to the Borrowers
and the Administrative Agent, and (d) the Administrative Agent reserves
the right, in its reasonable discretion, to require that each Preferred Equity
Interest be acquired by and pledged to the Administrative Agent by a bankruptcy
remote special purpose entity, which entity shall join the Credit Documents as
a co—Borrower pursuant to a Borrower Joinder Agreement as a condition to the
pledge of the Preferred Equity Interest, and for the Equity Interests in such
Borrower to be pledged to the Administrative Agent as additional Collateral for
the Obligations.  All references to, and
calculations required to be made in respect of, any principal and/or interest
associated with any Mortgage Asset, shall, with respect to Mortgage Assets
consisting of Preferred Equity Interests, be deemed to refer, respectively, to
the face amount of such Preferred Equity Interest and the preferred return or
yield (however such terms are denominated, as set forth in the related Mortgage
Loan Documents), whether payable or accrued.


 


“Preferred
Equity Interest Documents” shall have the meaning set forth in the
Custodial Agreement.


 


“Preferred
Equity Pledge and Security Agreement” shall mean the First Amended and
Restated Preferred Equity Pledge and Security Agreement, dated as of the date
hereof, between the Administrative 


 


30

















 


Agent
and each Borrower, as amended, modified, waived, supplemented, extended,
restated or replaced, from time to time in accordance with its terms.


 


“Preferred
Securities” shall mean, with respect to any Person, Equity Interests in
such Person that are entitled to preference or priority over any other Equity
Interests in such Person in respect of the payment (or accrual) of dividends or
distribution of assets upon liquidation, or both.


 


“Prime Rate” shall have the meaning set forth in the definition
of Alternate Base Rate.


 


“Private Information” shall have the meaning set forth in Section 5.15.


 


“Property”
shall mean any right or interest in or to property of any kind whatsoever,
whether real, personal or mixed, and whether tangible or intangible; provided
that the term “Property” or “Properties” as used in Section 3.10 shall include
only the right or interest in or to property of any kind whatsoever, whether
real, personal or mixed, and whether tangible or intangible of any Credit
Party.


 


“Property
Type” shall mean with respect to a Mortgage Asset, such Mortgaged Property’s
classification as one of the following: 
multifamily, mobile home park, retail, office, industrial, hotel, self—storage
facility, condominium, conversions or entitled land.


 


“PSA
Servicer” shall mean a third party servicer (other than a Borrower)
servicing all or a portion of the Collateral under a Pooling and Servicing
Agreement.


 


“Public
Information” shall have the meaning set forth in Section 5.15.


 


“Rating Agencies” shall mean each of S&P, Moody’s, Fitch and
any other nationally recognized statistical rating agency that has been
requested to issue a rating with respect to the matter at issue, including
successors of the foregoing.


 


“Register” shall have the meaning set forth in Section 10.6(c).


 


“Reindeer Debt” shall mean, as of any date of determination, the
Note Purchase Price, as converted to Dollars by the Administrative Agent in its
discretion as of any date of determination.


 


“Reindeer
Facility” shall mean that certain facility entered into and evidenced by
the Reindeer Note Purchase Agreement, together with all other documents
executed in connection therewith, as the same are amended modified, restated,
replaced, waived, substituted, supplemented or extended from time to time.


 


“Reindeer
Note Purchase Agreement” shall mean that certain Note Purchase Agreement,
dated as of March 29, 2007, between NRF—Reindeer Ltd., a Cayman Islands
exempted limited liability company, and Wachovia Bank, N.A. (London Branch), as
amended, modified, restated, replaced, waived, substituted, supplemented or
extended from time to time in accordance with its terms, including pursuant to
the First Amendment to Note Purchase Agreement and Repurchase Documents, dated
as of November 6, 2007, and the Second Amendment to Note Purchase
Agreement and Repurchase Documents, dated as of October 28, 2009


 


“REIT”
shall mean a “real estate investment trust” within the meaning of the Code.


 


31

















 


“Related Parties” shall mean, with respect to any Person, such
Person’s Subsidiaries and Affiliates and the partners, directors, officers,
employees, agents  and advisors of such Person and
of such Person’s Subsidiaries and Affiliates.


 


“Related
Party Loan” shall mean, any loan, Indebtedness or preferred equity
investment identified or presented as a related party loan in such Person’s and
its Consolidated Subsidiaries’ consolidated financial statements or in the
notes to the consolidated financial statements, in accordance with GAAP; provided,
however, the term Related Party Loan shall not include negotiated, arms—length,
market standard loan transactions with third parties.


 


“Release” shall mean any generation, treatment, use, storage,
transportation, manufacture, refinement, handling, production, removal,
remediation, disposal, presence or migration of Materials of Environmental
Concern on, about, under or within all or any portion of any Property or
Underlying Mortgaged Property.


 


“Release Amount” shall mean (a) with respect to any
Revolving Loan Collateral, the aggregate Allocated Revolving Loan Amount for all
Revolving Loans allocated to such item of Revolving Loan Collateral by the
Administrative Agent,  and (b) with
respect to any Term Loan Collateral, the Release Amount set forth on Schedule
1-A to the Fee Letter.


 


“Remedial Work” shall mean any investigation, inspection, site
monitoring, containment, clean—up, removal, response, corrective action,
mitigation, restoration or other remedial work of any kind or nature because
of, or in connection with, the current or future presence, suspected presence,
Release or threatened Release in or about the air, soil, ground water, surface
water or soil vapor at, on, about, under or within all or any portion of any
Property or Underlying Mortgaged Property of any Materials of Environmental
Concern, including any action to comply with any applicable Environmental Laws
or directives of any Governmental Authority with regard to any Environmental
Laws.


 


“REMIC” shall mean a real estate mortgage investment conduit.


 


“Removal
Date” shall mean those dates listed on Schedule 1.1(e).


 


“REO
Property” shall mean real property acquired by the Borrowers, including a
Mortgaged Property, acquired through foreclosure of a Mortgage Asset or by deed
in lieu of such foreclosure.


 


“Reorganization” shall mean, with respect to any Multiemployer
Plan, the condition that such Plan is in reorganization within the meaning of
such term as used in Section 4241 of ERISA.


 


“Reportable Event” shall mean any of the events set forth in Section 4043(c) of
ERISA, other than those events as to which the thirty-day notice period is
waived under PBGC Reg. §4043.


 


“Required Lenders” shall mean, as of any date of determination,
Lenders holding at least a majority of (a) the outstanding Revolving
Commitments, Delayed Draw Term Loan Commitments (to the extent such Delayed
Draw Term Loan Commitments have not been funded and remain in effect) and the
Term Loan or (b) if the Commitments have been terminated, the outstanding
Loans; provided, however, that if any Lender shall be a
Defaulting Lender at such time, then there shall be excluded from the
determination of Required Lenders the Obligations owing to such Defaulting
Lender and such Defaulting Lender’s Commitments.


 


“Required
Payments” shall mean all payments required under Section 2.5(b)(v) through
(vi) of this Agreement or subject to or required to be subject to an
Irrevocable Instruction, which amounts shall 


 


32

















 


be
free of any deductions for or on account of any set–off, counterclaim or
defense and shall be deposited into the Collection Account for application in
accordance with the terms of this Agreement.


 


“Requirement of Law” shall mean, as to any Person, (a) the
Authority Documents of such Person, and (b) 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);
in each case applicable to or binding upon such Person or any of its Property
or to which such Person or any of its Property is subject.


 


“Responsible Officer” shall mean, for any Credit Party, any duly
authorized officer thereof and also, with respect to any particular matter, any
other duly authorized officer with knowledge of or familiarity with the
particular subject matter and, in each case, the Administrative Agent has an
incumbency certificate indicating such officer is a duly authorized officer thereof.


 


“Restatement
Date” shall mean the date of this Agreement.


 


“Restricted Payment” shall mean (a) any dividend or other
distribution, direct or indirect, on account of any Equity Interests of Northstar Corp or any Consolidated
Subsidiary of Northstar Corp now
or hereafter outstanding, except a dividend payable solely in Equity Interests
of identical class to the holders of that class; (b) any redemption,
conversion, exchange, retirement, sinking fund or similar payment, purchase or
other acquisition for value, direct or indirect, of any Equity Interests of Northstar Corp or any Consolidated
Subsidiary of Northstar Corp now
or hereafter outstanding; and (c) any payment made to retire, or to obtain
the surrender of, any outstanding warrants, options or other rights to acquire
any Equity Interests of Northstar Corp or
any Consolidated Subsidiary of Northstar
Corp now or hereafter outstanding.


 


“Retained
Interest” shall mean (a) with respect to any Mortgage Asset with
an unfunded commitment on the part of a Borrower, all of the obligations,
if any, to provide additional funding, contributions, payments or credits with
respect to such Mortgage Asset, (b) all duties, obligations and
liabilities of a Borrower under any Mortgage Asset or any related
Interest Rate Protection Agreement, including but not limited to any payment or
indemnity obligations and (c) with respect to any Mortgage Asset that
is pledged or to be pledged to the Administrative Agent, (i) all
of the obligations, if any, of the agent(s), trustee(s), servicer(s),
administrators or other similar Persons under the documentation evidencing such
Mortgage Asset and (ii) the applicable portion of the interests, rights
and obligations under the documentation evidencing such Mortgage
Asset that relate to such portion(s) of the Indebtedness that is
owned by another lender or is being retained by a Borrower pursuant to
clause (a) of this definition.


 


“Revolver Maturity Date” shall mean the date that is three (3) years
following the Restatement Date.


 


“Revolving
Commitment” shall mean, with respect to each Revolving Lender, the
commitment of such Revolving Lender to make Revolving Loans in an aggregate
principal amount at any time outstanding up to an amount equal to such
Revolving Lender’s Revolving Commitment Percentage of the Revolving Committed
Amount.


 


“Revolving
Commitment Percentage” shall mean, for each Lender, the percentage
identified as its Revolving Commitment Percentage in its Lender Commitment
Letter or in the Assignment and 


 


33

















 


Assumption
pursuant to which such Lender became a Lender hereunder, as such percentage may
be modified in connection with any assignment made in accordance with the
provisions of Section 10.6(c).


 


“Revolving
Committed Amount” shall have the meaning set forth in Section 2.1(a).


 


“Revolving
Lender” shall mean, as of any date of determination, a Lender holding a
Revolving Commitment or a Revolving Loan on such date.


 


“Revolving
Loan” shall have the meaning set forth in Section 2.1.


 


“Revolving
Loan Collateral” shall mean the portion of the Pledged Mortgage Assets
included in the Collateral with respect to which Revolving Loans (if any) are
calculated and determined.


 


“Revolving
Note” or “Revolving Notes” shall mean the first amended and restated
promissory notes of the Borrowers provided pursuant to Section 2.1(e) in
favor of any of the Revolving Lenders evidencing the Revolving Loans provided
by any such Revolving Lender pursuant to Section 2.1(a), individually or
collectively, as appropriate, as such promissory notes may be amended,
modified, extended, restated, replaced, or supplemented from time to time.


 


“S&P”
shall mean Standard & Poor’s Ratings Services, a division of The
McGraw Hill Companies, Inc.


 


“Sanctioned
Entity” shall mean (a) a country or a government of a country, (b) an
agency of the government of a country, (c) an organization directly or
indirectly controlled by a country or its government, or (d) a person or
entity resident in or determined to be resident in a country, that is subject
to a country sanctions program administered and enforced by OFAC described or
referenced at http://www.ustreas.gov/offices/enforcement/ofac/ or as otherwise
published from time to time.


 


“Sanctioned
Person” shall mean a person named on the list of Specially Designated
Nationals maintained by OFAC available at or through http://www.ustreas.gov/offices/enforcement/ofac/
or as otherwise published from time to time.


 


“Sarbanes-Oxley”
shall mean the Sarbanes-Oxley Act of 2002, as amended or modified from time to
time.


 


“SEC”
shall mean the Securities and Exchange Commission or any successor Governmental
Authority.


 


“Secured
Parties” shall mean the Administrative Agent and the Lenders.


 


“Securities
Act” shall mean the Securities Act of 1933, together with any
amendment thereto or replacement thereof and any rules or regulations
promulgated thereunder.


 


“Securities
Account” shall mean the securities account set forth on Schedule 1.1(d) established
in the name of the Borrowers into which all CMBS Securities that are Pledged
Mortgage Assets and other Collateral related thereto shall be deposited (except
those CMBS Securities that are certificated securities within the meaning of Article 8
of the UCC), which Securities Account shall be subject to the Securities
Account Control Agreement.  Any Income on
deposit or credited to the Securities Account shall be transferred by the
Administrative Agent from the Securities Account to the Collection Account on
or prior to each Payment Date.


 


34

















 


“Securities
Account Control Agreement” shall mean a first amended and restated letter
agreement, dated as of the date hereof, among the Borrowers, the Administrative
Agent and Wachovia in the form of Exhibit 1.1(m) attached
hereto, as amended, modified, extended, restated, replaced, or supplemented
from time to time in accordance with its terms.


 


“Securities
Laws” shall mean the Securities Act, the Exchange Act, Sarbanes-Oxley and
the applicable accounting and auditing principles, rules, standards and
practices promulgated, approved or incorporated by the SEC or the Public
Company Accounting Oversight Board, as each of the foregoing may be amended and
in effect on any applicable date hereunder.


 


“Security
Agreement” shall mean the First Amended and Restated Security Agreement,
dated as of the Restatement Date, executed by the Borrowers in favor of the
Administrative Agent, for the benefit of the Secured Parties, as amended,
modified, extended, restated, replaced, or supplemented from time to time in
accordance with its terms.


 


“Security Documents” shall mean the Security Agreement, the
Account Control Agreement, the Securities Account Control Agreement, the
Custodial Agreement, all Assignments, all Irrevocable Instructions, the Pledge
Agreements and all other agreements, documents and instruments relating to,
arising out of, or in any way connected with any of the foregoing documents or
granting to the Administrative Agent Liens or security interests to secure,
inter alia, the Obligations whether now or hereafter executed and/or filed,
each as may be amended from time to time in accordance with the terms hereof,
executed and delivered in connection with the granting, attachment and
perfection of the Administrative Agent’s security interests and Liens arising
thereunder, including, without limitation, UCC financing statements, as such
agreements or instruments are amended, restated, modified or supplemented from
time to time.


 


“Senior
Secured Bank Debt” shall mean an assignment of or participation in all or a
portion of a secured senior term loan to a Obligor, which loan (a) is
rated B- or better by at least two (2) Rating Agencies, (b) is
senior or pari passu with other secured
obligations of such Obligor and (c) is secured by (i) 100% of the
Equity Interest of each existing and subsequently acquired or organized direct
or indirect Domestic Subsidiary of the Obligor and (ii) substantially all
tangible and intangible assets (including, but not limited to, inventory,
accounts receivable, plant, machinery, equipment, fixtures, Commercial Real
Estate, leasehold interests, intellectual property, contracts, license rights
and other general intangibles and investment property) of the Obligor.  Each Senior Secured Bank Debt is subject to
such additional underwriting criteria and other terms, conditions and
requirements as the Administrative Agent may require in its discretion.


 


“Servicer”
shall mean a Person (other than a Borrower) servicing all or a portion of a
Mortgage Asset under a Servicing Agreement, which Servicer shall be acceptable
to the Administrative Agent in its reasonable discretion.


 


“Servicer
Account” shall mean any account established by a Servicer or a PSA Servicer
in connection with the servicing of the Mortgage Asset.


 


“Servicer
Default” shall have the meaning set forth in Section 9.12.


 


“Servicer
Redirection Notice” shall mean, the notice from a Borrower to a Servicer,
substantially in the form of Exhibit 1.1(k) attached hereto,
duly executed by the parties thereto.


 


“Servicing
Agreement” shall mean an agreement entered into by the applicable Borrower
and a third party for the servicing of a Mortgage Asset, the form and substance
of which has been approved in 


 


35

















 


writing
by the Administrative Agent in its reasonable discretion, as amended, modified,
extended, restated, replaced, or supplemented from time to time in accordance
with its terms.


 


“Servicing
File” shall mean, with respect to each Mortgage Asset, the file retained by
a Borrower consisting of the originals of all documents in the Mortgage Asset
File that are not delivered to the Custodian and copies of all documents in the
Mortgage Asset File set forth in Section 3.1  of
the Custodial Agreement.


 


“Servicing
Records” shall have the meaning set forth in Section 9.2.


 


“Single Employer Plan” shall mean any Plan that is not a
Multiemployer Plan.


 


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


 


“Subordinate
CTL Loan” shall mean (a) a loan that is a CTL Loan in all respects
except for the failure to satisfy the ratings requirements for a Credit Tenant
or (b) a performing Junior Interest or Mezzanine Loan in which the related
senior loan is secured by a first priority perfected security interest in
Commercial Real Estate 100% leased to, or guaranteed in full by, a Credit
Tenant, and such Junior Interest or Mezzanine Loan, as applicable, itself is
secured by a first priority perfected security interest in and to the payments
under the Credit Tenant Lease; provided, however, in the case of
both clauses (a) and (b), such Subordinate CTL Loan satisfies such
additional underwriting criteria and other terms, conditions and requirements
as the Administrative Agent may require in its discretion.


 


“Subsidiary” shall mean, as to any Person, a corporation,
partnership, limited liability company 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, limited liability company, 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 any Credit Party.


 


“Table
Funded Mortgage Asset” shall mean a Mortgage Asset which is pledged to the
Administrative Agent simultaneously with the origination or acquisition
thereof, which origination or acquisition, pursuant to a Borrower’s request, is
financed with the proceeds of a Revolving Loan and paid directly to a title
company or other settlement agent, in each case, approved in writing by the
Administrative Agent in its discretion, for disbursement to the parties
entitled thereto in connection with such origination or acquisition.  A Mortgage Asset shall cease to be a Table
Funded Mortgage Asset after the Custodian has delivered a Trust Receipt (along
with a completed Mortgage Asset File Checklist attached thereto) to the
Administrative Agent certifying its receipt of the Mortgage Asset File
therefor.


 


36

















 


“Table
Funded Trust Receipt” shall mean a Trust Receipt in the form of Annex 2—B
to the Custodial Agreement.


 


“Tangible Net Worth” shall mean, as of a
particular date and as to any Person:


 


(a)           all amounts that would be included under stockholder
equity (or the equivalent) on a balance sheet of such Person and its
Consolidated Subsidiaries (including minority interests relating to NorthStar
LP) determined on a consolidated basis at such date determined in accordance
with GAAP plus accumulated depreciation on owned real estate assets, less


 


(b)           in each case with respect to such Person and its
Consolidated Subsidiaries determined on a consolidated basis (i) amounts
owing to such Person from Affiliates, or from officers, employees, partners,
members, directors, shareholders or other Persons similarly affiliated with
such Person or its respective Affiliates, (ii) intangible assets of such
Person, as determined in accordance with GAAP, except for FAS 141 intangible
assets, (iii) the value of REO Property and Foreclosed Loans of such Person,
(iv) prepaid taxes and expenses, (v) unamortized hedging positions
under Derivatives Contracts, and (vi) (without duplication) Related Party
Loans.


 


“Taxes” shall mean all present or future taxes, levies, imposts,
duties, deductions, withholdings, assessments, fees or other charges imposed by
any Governmental Authority, including any interest, additions to tax or
penalties applicable thereto.


 


“Term
Loan” shall have the meaning set forth in Section 2.2(a); provided
that for the avoidance of doubt, any outstanding Delayed Draw Term Loan shall
constitute a “Term Loan” hereunder.


 


“Term
Loan Collateral” shall mean the portion of the Pledged Mortgage Assets
included in the Collateral with respect to which advances under the Term Loan
and Delayed Draw Term Loan (if any) are calculated and determined.


 


“Term Loan Commitment” shall mean, with respect to each Term
Loan Lender, the commitment of such Term Loan Lender to make its portion of the
Term Loan and the Delayed Draw Term Loan, as applicable, in a principal amount
equal to such Term Loan Lender’s Term Loan Commitment Percentage of the Term
Loan Committed Amount and Delayed Draw Term Loan Committed Amount, as
applicable.


 


“Term
Loan Commitment Percentage” shall mean, for any Term Loan Lender, the
percentage identified as its Term Loan Commitment Percentage in its Lender
Commitment Letter, or in the Assignment and Assumption pursuant to which such
Lender became a Lender hereunder, as such percentage may be modified in
connection with any assignment made in accordance with the provisions of Section 10.6(c).


 


“Term
Loan Committed Amount” shall have the meaning set forth in Section 2.2(a) and
as such amount may be increased pursuant to Section 2.2(b).


 


“Term
Loan Lender” shall mean a Lender holding a Term Loan Commitment or a
Delayed Draw Term Loan Commitment or a portion of the outstanding Term Loan.


 


“Term Loan Maturity Date” shall mean the date that is three (3) years
following the Restatement Date.


 


37

















 


“Term
Loan Note” or “Term Loan Notes” shall mean the first amended and
restated promissory notes of the Borrowers (if any) in favor of any of the Term
Loan Lenders evidencing the portion of the Term Loans provided by any such Term
Loan Lender pursuant to Section 2.2(a), individually or collectively, as
appropriate, as such promissory notes may be amended, modified, extended,
restated, replaced, or supplemented from time to time.


 


“Test
Period” shall mean the most recent calendar quarter.


 


“Total
Assets” shall mean, at any time, an amount equal to the aggregate
undepreciated book value of (a) all assets owned by any Person(s) (on
a consolidated basis) and (b) the proportionate share of assets owned by
non-consolidated Subsidiaries of such Person(s), less (i) amounts
owing to such Person(s) from any Affiliates thereof, or from officers,
employees, partners, members, directors, shareholders or other Persons
similarly affiliated with such Person(s) or their respective Affiliates, (ii) intangible
assets (other than Interest Rate Protection Agreements specifically related to
the Mortgaged Assets, excluding FAS 141 intangible assets) and (iii) prepaid
taxes and/or expenses.


 


“Total
Liabilities” shall mean, all Indebtedness and Contingent Liabilities of any
Person (without duplication) and all Subsidiaries thereof determined on a
consolidated basis in accordance with GAAP.


 


“Tranche”
shall mean the collective reference to (a) LIBOR Rate Loans whose Interest
Periods begin and end on the same day and (b) Alternate Base Rate Loans made
on the same day.


 


“Transactions”
shall mean the closing of this Agreement, the other Credit Documents and the
other transactions contemplated hereby to occur in connection with such closing
(including, without limitation, the initial borrowings under the Credit
Documents and the payment of fees and expenses in connection with all of the
foregoing).


 


“Transfer
Effective Date” shall have the meaning set forth in each Assignment and
Assumption.


 


“Trust
Preferred Securities” shall mean those REIT trust preferred securities
issued by NorthStar Corp or its Affiliates identified on Schedule 1.1(e) attached
hereto and such other REIT trust preferred securities issued by NorthStar Corp
and/or an Affiliate which are approved by the Administrative Agent in its discretion,
in each case which are expressly subordinated to all other Indebtedness of
NorthStar Corp and its Affiliates.  REIT
trust preferred securities issued by NorthStar Corp and/or its Affiliates shall
be deemed approved by the Administrative Agent if such securities are issued on
terms substantially similar to those securities listed on Schedule 1.1(e),
as determined by the Administrative Agent in its reasonable discretion.


 


“Trust
Receipt” shall have the meaning set forth in the Custodial Agreement.


 


“Type”
shall mean, as to any Loan, its nature as an Alternate Base Rate Loan or LIBOR
Rate Loan, as the case may be.


 


“UCC”
shall mean the Uniform Commercial Code from time to time in effect in any
applicable jurisdiction.


 


“Underlying
Mortgaged Property” shall mean (a) in the case of a Whole Loan, the
Mortgaged Property securing the Whole Loan, (b) in the case of a Junior
Interest, the Mortgaged Property securing such Junior Interest (if the Junior
Interest is of the type described in clause (b) of the definition
thereof), or the Mortgaged Property securing the mortgage loan in which such
Junior Interest represents a participation (if the Junior Interest is of the
type described in clause (a) of the definition thereof), (c) in 


 


38

















 


the
case of a Mezzanine Loan or a Junior Interest in a Mezzanine Loan, the
Mortgaged Property that secures the senior mortgage loan, (d) in the case
of a Bridge Loan, CTL Loan or Subordinate CTL Loan, the Mortgaged Property
securing the Whole Loan, Junior Interest or Mezzanine Loan, as applicable, (e) in
the case of a CMBS Security, the Mortgaged Properties backing such CMBS
Securities, (f) in the case of Senior Secured Bank Debt, the Mortgaged
Property, if any, securing such Senior Secured Bank Debt and (g) in the
case of a Preferred Equity Interest, the Mortgaged Property owned directly or
indirectly by the Preferred Equity Grantor.


 


“Underwriting
Package” shall mean, with respect to any Mortgage Asset (other than a CMBS
Security), the Underwriting Package shall include, to the extent applicable, (a) a
copy of the Current Appraisal or, if unavailable, any other recent appraisal, (b) the
current rent roll, (c) a minimum of two (2) years of property
level financial statements to the extent available, (d) the current
financial statements of the Obligor under the Mortgage Asset, and, if such
Mortgage Asset is not a Whole Loan, the Obligor under the Commercial Real
Estate Loan to the extent provided to or reasonably available to the applicable
Borrower upon request, (e) the loan documents, Authority Documents and
title commitment/policy to be included in the Mortgage Asset File, together
with copies of any appraisals, environmental reports, studies or assessments
(to include, at a minimum, a phase I report), evidence of zoning compliance,
property management agreements, assignments of property management agreements,
contracts, licenses and permits, in each case to the extent in the Borrower’s
possession or reasonably available to the Borrower and, if the Mortgage Asset
is pledged by the Administrative Agent, assignments of such documents by the
Borrower in blank to the extent covered by assignments in blank delivered to
the Custodian, (f) any financial analysis, site inspection, market studies,
environmental reports and any other diligence conducted by or provided to the
Borrower and (g) such further documents or information as the
Administrative Agent may reasonably request. 
With respect to any CMBS Security, the Underwriting Package shall consist
of, to the extent applicable, (i) the related prospectus or offering
circular, (ii) all structural and collateral term sheets and all other
computational or other similar materials provided to the applicable Borrower in
connection with its acquisition of such CMBS Security, (iii) all
distribution date statements issued in respect thereof during the immediately
preceding twelve (12) months (or, if less, since the date such CMBS
Security was issued), (iv) all monthly reporting packages issued in
respect of such CMBS Security during the immediately preceding twelve (12)
months (or, if less, since the date such CMBS Security was issued), (v) all
Rating Agency pre—sale reports, (vi) all asset summaries and any other due
diligence materials, including, without limitation, reports prepared by third
parties, provided to the Borrower in connection with its acquisition of such
CMBS Security, and (vii) such further documents or information as the
Administrative Agent may reasonably request. 
With respect to Bridge Loans and Construction Loans, the Underwriting
Package shall include the Construction Draw Deliveries for each Extension of
Credit.


 


“Voting
Interests” shall mean, with respect to any Person, Equity Interests issued
by such Person the holders of which are ordinarily, in the absence of
contingencies, entitled to vote for the election of directors (or persons
performing similar functions) of such Person, even though the right so to vote
has been suspended by the happening of such a contingency.


 


“Wachovia”
shall mean Wachovia Bank, National Association, a national banking association,
together with its successors and/or assigns.


 


“Wachovia
Assets” shall mean, any Mortgage Asset issued, extended or originated by
Wachovia Corporation or an Affiliate of Wachovia Corporation.


 


“Warehouse
Lender’s Release Letter” shall mean a letter in the form of Exhibit 1.1(l) hereto,
duly executed by the applicable warehouse lender.


 


39














 


“Warrant
Agreements” shall mean the three (3) separate Common Stock Purchase
Warrants, issued on the Restatement Date, by Northstar Corp for the benefit of
Wachovia, as amended, modified, extended, restated, replaced, or supplemented
from time to time in accordance with its terms.


 


“Whole
Loan” shall mean a performing Commercial Real Estate whole loan secured by
a first priority security interest in stabilized and non-transitional
Underlying Mortgaged Property; provided that, for purposes of the Term
Loan Collateral, Whole Loans may include Construction Loans.


 


Section 1.2            Other Definitional Provisions.


 


The definitions of terms herein shall apply equally to the singular and
plural forms of the terms defined. 
Whenever the context may require, any pronoun shall include the
corresponding masculine, feminine and neuter forms.  The words “include,” “includes” and “including”
shall be deemed to be followed by the phrase “without limitation.”  The word “will” shall be construed to have
the same meaning and effect as the word “shall.”  Unless the context requires otherwise (a) any
definition of or reference to any agreement, instrument or other document
herein shall be construed as referring to such agreement, instrument or other
document as from time to time amended, supplemented or otherwise modified
(subject to any restrictions on such amendments, supplements or modifications
set forth herein), (b) any reference herein to any Person shall be
construed to include such Person’s successors and assigns, (c) the words “herein,”
“hereof” and “hereunder,” and words of similar import, shall be construed to
refer to this Agreement in its entirety and not to any particular provision
hereof, (d) all references herein to Articles, Sections, Exhibits and
Schedules shall be construed to refer to Articles and Sections of, and Exhibits
and Schedules to, this Agreement, (e) any reference to any law or
regulation herein shall, unless otherwise specified, refer to such law or
regulation as amended, modified or supplemented from time to time and (f) the
word “asset” shall be construed to have the same meaning and effect as
Property.


 


Section 1.3            Accounting Terms.


 


Unless
otherwise specified herein, all accounting terms used herein shall be
interpreted, all accounting determinations hereunder shall be made, and all
financial statements required to be delivered hereunder shall be prepared in
accordance with GAAP applied on a consistent basis; provided that,, if
the Borrowers shall notify the Administrative Agent that they wish to amend any
definitions or covenant incorporated in Section 5.9 to eliminate the
effect of any change in GAAP on the operation of any such definition or
provision (or if the Administrative Agent notifies the Borrowers that the
Required Lenders wish to amend any such definition or provision for such
purpose), then the Borrowers’ compliance with such provisions shall be
determined on the basis of GAAP in effect immediately before the relevant
change in GAAP became effective, until either such notice is withdrawn or such
definition or provision is amended in a manner satisfactory to the Borrowers,
the Administrative Agent and the Required Lenders.


 


The
Borrowers shall deliver to the Administrative Agent and each Lender at the same
time as the delivery of any annual or quarterly financial statements given in
accordance with the provisions of Section 5.1, (a) a description in
reasonable detail of any material change in the application of accounting
principles employed in the preparation of such financial statements from those
applied in the most recently preceding quarterly or annual financial statements
as to which no objection shall have been made in accordance with the provisions
above and (b) a reasonable estimate of the effect on the financial
statements on account of such changes in application.


 


Section 1.4            Time References.


 


Unless
otherwise specified, all references herein to times of day shall be references
to Eastern time (daylight or standard, as applicable).  Reference to day or days without further
qualification means 


 


40

















 


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


 


Section 1.5            Execution of Documents.


 


Unless
otherwise specified, all Credit Documents and all other certificates executed
in connection therewith must be signed by a Responsible Officer.  Unless otherwise expressly provided in this
Agreement, reference to any notice, request, approval, consent or determination
provided for, permitted or required under the terms of the Credit
Documents with respect to the Credit Parties, the Administrative Agent and
the Lenders means, in order for such notice, request, approval, consent or
determination to be effective hereunder, such notice, request, approval or
consent must be in writing.


 


Section 1.6            UCC Terms.


 


All
terms used in Articles 8 and 9 of the UCC in the State of New York, and
used but not specifically defined herein, are used herein as defined in such Article 8
and 9.


 


Section 1.7            References to Discretion.


 


The
term “discretion” shall have the meaning set forth in the Fee Letter.


 


Section 1.8            References to Payment.


 


Unless
otherwise specifically provided herein, all payments due by any Credit Party to
the Administrative Agent or the Lenders shall be due by 3:00 p.m. on the
date due.


 


ARTICLE II


 


THE LOANS; AMOUNT AND TERMS


 


Section 2.1            Revolving Loans.


 


(a)           Revolving Commitment.  During the Commitment Period, subject to the
terms and conditions hereof, each Revolving Lender severally, but not jointly,
agrees to make revolving credit loans in Dollars (“Revolving Loans”) to
the Borrowers from time to time in an aggregate principal amount of up to THREE HUNDRED MILLION DOLLARS ($300,000,000) (as such
aggregate maximum amount may be reduced from time to time as provided in Section 2.4,
the “Revolving Committed Amount”) for the purposes hereinafter set
forth; provided, however, that (i) with regard to each
Revolving Lender individually, the sum of such Revolving Lender’s Revolving
Commitment Percentage of the aggregate principal amount of outstanding
Revolving Loans shall not exceed such Revolving Lender’s Revolving Commitment
and with regard to the Revolving Lenders collectively, the sum of the aggregate
principal amount of outstanding Revolving Loans shall not exceed the Revolving
Committed Amount then in effect and (ii) the sum of the aggregate
principal amount of outstanding Revolving Loans shall not exceed the Available
Borrowing Capacity.


 


No Revolving Loan shall be made by any Revolving Lender if (i) such
Revolving Loan and the Revolving Loan Collateral therefor are not approved by
the Administrative Agent in its discretion, (ii) before or after giving
effect to such Revolving Loan, the Availability is or would 


 


41

















 


be
negative, (iii) before or after giving effect to such Revolving Loan, the
aggregate principal amount of outstanding Revolving Loans would exceed the
Available Borrowing Capacity and (iv) the conditions to Extensions of
Credit in Section 4.2 are not satisfied. 
Revolving Loans may consist of Alternate Base Rate Loans or LIBOR Rate
Loans, or a combination thereof, as the Borrowers may request, and may be
repaid and reborrowed in accordance with the provisions hereof; provided,
however, the Revolving Loans made on the Restatement Date or any of the
three (3) Business Days following the Restatement Date may only
consist of Alternate Base Rate Loans unless the Borrowers deliver a funding
indemnity letter, substantially in the form of Exhibit 2.1(a),
reasonably acceptable to the Administrative Agent not less than three (3) Business
Days prior to the Restatement Date. 
LIBOR Rate Loans shall be made by each Revolving Lender at its LIBOR
Lending Office and Alternate Base Rate Loans at its Domestic Lending Office.


 


(b)           Revolving Loan
Borrowings.


 


(i)            Notice of
Borrowing.


 


(1) The Borrowers may
request Revolving Loans for the purpose of financing Eligible Assets approved
by the Administrative Agent in its discretion and for no other purpose.  The Borrowers shall request a Revolving Loan
borrowing by delivering a written Notice of Borrowing (or telephone notice promptly
confirmed in writing by delivery of a written Notice of Borrowing, which
delivery may be by Electronic Transmission) to the Administrative Agent along
with a Compliance Certificate, Borrower Asset Schedule and Underwriting Package
for the related Eligible Asset(s) to be financed not later than (A) ten
(10) Business Days for Non-Wachovia Assets and (B) seven (7) Business
Days for Wachovia Assets from the delivery of the applicable Notice of
Borrowing.  Each such Notice of Borrowing
shall specify (A) that a Revolving Loan is requested, (B) the date of
the requested borrowing (which shall be a Business Day), (C) the aggregate
principal amount to be borrowed, (D) whether the borrowing shall be
comprised of Alternate Base Rate Loans, LIBOR Rate Loans or a combination
thereof, and if LIBOR Rate Loans are requested, the Interest Period(s) therefor,
(E) the applicable Borrower and the Eligible Asset to be financed, (F) a
calculation of Availability and (G) the amount of Available Borrowing
Capacity.  If the Borrowers shall fail to
specify in any such Notice of Borrowing (1) an applicable Interest Period
in the case of a LIBOR Rate Loan, then such notice shall be deemed to be a
request for an Interest Period of one month, or (2) the Type of Revolving
Loan requested, then such notice shall be deemed to be a request for a
one-month LIBOR Rate Loan.


 


(2)           The Administrative Agent shall notify the applicable Borrower in writing of the
Administrative Agent’s tentative approval (and the proposed Allocated Revolving
Loan Amount for each Eligible Asset) or final disapproval of each proposed
Eligible Asset within, (i) in the case of Non—Wachovia Assets, eight (8) Business
Days (or such greater time as the Administrative Agent determines in its
discretion for multiple assets or assets with multiple Mortgaged Properties)
and, (ii) in the case of Wachovia Assets, five (5) Business Days
(or such greater time as the Administrative Agent determines in its discretion
for multiple assets or assets with multiple Mortgaged Properties) after its
receipt of the Notice of Borrowing, the Borrower Asset Schedule, the Compliance
Certificate, the complete Underwriting Package and any supplemental requests
(requested orally or in writing) relating to such proposed Eligible Asset.  Unless 


 


42

















 


the
Administrative Agent notifies the Borrowers
in writing of the Administrative Agent’s approval of such proposed Eligible
Asset within the applicable period, the Administrative Agent shall be deemed
not to have approved such proposed Eligible Asset.  The Administrative Agent in its discretion
may waive, shorten or increase any of the applicable time periods for the
review of proposed Eligible Assets or the delivery of documents.


 


(3)           Provided that the Administrative Agent on behalf of
the Lenders has tentatively agreed to finance the Eligible Asset described in
the Notice of Borrowing and the proposed Allocated Revolving Loan Amount is
acceptable to the applicable Borrower, the applicable Borrower shall forward to
the Administrative Agent, via Electronic Transmission, at least two (2) Business
Days prior to the requested Borrowing Date (which must be received by the
Administrative Agent no later than 5:00 p.m. two (2) Business
Days prior to the requested Borrowing Date) an executed confirmation for each
Eligible Asset, substantially in the form of Exhibit 2.1(b) attached
hereto (a “Confirmation”).  The
Confirmation shall specify the Allocated Revolving Loan Amount for the related
Eligible Asset and any additional terms or conditions of the related Revolving
Loan not inconsistent with this Agreement. 
The Confirmation executed by the Borrower shall be irrevocable unless
consented to by the Administrative Agent in its discretion.  The delivery of the Confirmation to the
Administrative Agent shall be deemed to be a certification by the applicable
Borrower that, among other things, all conditions precedent to such Revolving
Loan set forth in Articles II and IV have been satisfied (except the
Administrative Agent’s consent).  Unless
otherwise agreed in writing, upon receipt of the Confirmation, the
Administrative Agent, on behalf of the Lenders, may, in the Administrative
Agent’s discretion, agree to enter into the requested Revolving Loan with
respect to an Eligible Asset, and such agreement shall be evidenced by the
Administrative Agent’s signature on the Confirmation.  Any Confirmation executed by the
Administrative Agent shall be deemed to have been received by the applicable
Borrower on the date actually received by the applicable Borrower.


 


(4)           Upon receipt of the Confirmation executed by the
Administrative Agent, (i) the
applicable Borrower shall release or cause to be released to the Custodian in
accordance with the Custodial Agreement (1) in the case of a single Non—Table
Funded Mortgage Asset, no later than 1:00 p.m. one (1) Business Day
(for more than one (1) Non-Table Funded Mortgage Assets, two (2) Business
Days) prior to the requested Borrowing Date, and (2) in the case of a
Table Funded Mortgage Asset, no later than 1:00 p.m. three (3) Business
Days following the applicable Borrowing Date, the Mortgage Asset File
pertaining to each Eligible Asset to be financed by the Revolving Lenders, and (ii) the applicable Borrower shall
deliver to the Custodian, in connection with the applicable delivery under
clause (i) above, a Custodial Identification Certificate and a
Mortgage Asset File Checklist required under Section 3.2 of the Custodial
Agreement.


 


(5)           Each Confirmation, together with this Agreement,
shall constitute conclusive evidence of the terms agreed between the
Administrative Agent and the
applicable Borrower with respect to the Revolving Loan to which the
Confirmation relates, and the applicable Borrower’s acceptance of the related 


 


43

















 


proceeds
shall constitute the applicable Borrower’s agreement to the terms of such
Confirmation.  It is the intention of the
parties that each Confirmation shall not be separate from this Agreement but
shall be made a part of this Agreement. 
To the extent of a conflict between this Agreement and the related
Confirmation, the Confirmation shall control.


 


(6)           Pursuant to the Custodial Agreement, the Custodian
shall deliver to the Administrative Agent and the applicable Borrower by 1:00 p.m.
on the Borrowing Date for each Non—Table Funded Mortgage Asset a Trust Receipt
(along with a completed Mortgage Asset File Checklist attached thereto) and an
Asset Schedule and Exception Report relating to the Basic Mortgage Asset
Documents with respect to the Eligible Assets that the applicable Borrower has
requested the Revolving Lenders to finance on such Borrowing Date.  With respect to each Table Funded Mortgage
Asset, the applicable Borrower shall cause the Bailee to deliver to the Custodian
with a copy to the Administrative Agent no later than 1:00 p.m. on the
Borrowing Date by facsimile the related Basic Mortgage Asset Documents, the
insured closing letter (if any), the escrow instructions (if any), a fully
executed Bailee Agreement, a Bailee’s Trust Receipt issued by the Bailee
thereunder and such other evidence satisfactory to the Administrative Agent in
its discretion that all documents necessary to effect a pledge of the related
Eligible Asset and the related Collateral to the Administrative Agent on behalf
of the Lenders have been delivered to Bailee. 
With respect to each Table Funded Mortgage Asset, the Custodian shall
deliver to the Administrative Agent a Table Funded Trust Receipt no later than
3:00 p.m. on the Borrowing Date, which documents shall be acceptable to
the Administrative Agent in its discretion. 
In the case of a Table Funded Mortgage Asset, no later than 3:00 p.m.
on the second (2nd) Business Day following the Custodian’s receipt of the
related Mortgage Loan Documents comprising the Mortgage Asset File, the
Custodian shall deliver to the Administrative Agent a Trust Receipt (along with
a completed Mortgage Asset File Checklist attached thereto) certifying its
receipt of the documents required to be delivered pursuant to the Custodial
Agreement, together with an Asset Schedule and Exception Report relating to the
Basic Mortgage Asset Documents, with any Exceptions identified by the Custodian
as of the date and time of delivery of such Asset Schedule and Exception Report.  The Custodian shall deliver to the
Administrative Agent an Asset Schedule and Exception Report relating to all of
the Mortgage Loan Documents within five (5) Business Days of its
receipt of the related Mortgage Asset Files.


 


(7)           Once the Confirmation is
executed by the Administrative Agent, the Administrative Agent shall give
notice to each Revolving Lender at least one (1) Business Day prior to the
Borrowing Date  of each such Revolving Lender’s
share thereof.


 


(ii)           Minimum Amounts.  Each Revolving Loan that is made as an
Alternate Base Rate Loan shall be in a minimum aggregate amount of $1,000,000
and in integral multiples of $100,000 in excess thereof (or the remaining
amount of the Revolving Committed Amount, if less).  Each Revolving Loan that is made as a LIBOR
Rate Loan shall be in a minimum aggregate amount of $1,000,000 and in integral
multiples of $100,000 in excess thereof (or the remaining amount of the
Revolving Committed Amount, if less).


 


44

















 


(iii)          Advances.  Each Revolving Lender will make its Revolving
Commitment Percentage of each Revolving Loan borrowing available to the
Administrative Agent for the account of the applicable Borrower at the office
of the Administrative Agent specified in Section 10.2, or at such other
office as the Administrative Agent may designate in writing, by 1:00 p.m.
on the Borrowing Date, in Dollars and in funds immediately available to the
Administrative Agent.  Upon receipt by
the Administrative Agent of any such amounts, such borrowing will then be made
available to the applicable Borrower by 5:00 p.m. on the Borrowing Date by
the Administrative Agent by crediting the account of the applicable Borrower on
the books of the office of the Administrative Agent specified in Section 10.2,
or at such other office as the Administrative Agent may designate in writing,
with the aggregate of the amounts made available to the Administrative Agent by
the Revolving Lenders and in like funds as received by the Administrative Agent
(or by crediting such other account(s) as directed in writing by the
Borrowers).


 


(iv)          Additional
Revolving Loans.  The
Borrowers may request additional Revolving Loans with respect to the then
existing Revolving Loan Collateral; provided that (A) such request
is subject to the Administrative Agent’s approval in its discretion, (B) before
and after giving effect to such Extension of Credit, the Availability is not
and would not be negative, (C) before or after giving effect to such
Revolving Loan, the aggregate principal amount of outstanding Revolving Loans
would not exceed the Available Borrowing Capacity, (D) no Default or Event
of Default exists, (E) the Borrowers deliver a Notice of Borrowing, a
Compliance Certificate and such other information and documents as the
Administrative Agent shall require in its discretion at least three (3) Business
Days prior to the requested Borrowing Date and (F) to the extent approved
by the Administrative Agent, the Administrative Agent shall notify the
Borrowers of the amount of Revolving Loans so approved and the Borrowers and
the Administrative Agent shall execute one (1) or more amended
Confirmations evidencing the new Allocated Revolving Loan Amounts and Release
Amounts for the Revolving Loan Collateral with respect to which the
Administrative Agent has determined to permit such additional Extension of
Credit, together with such other terms and conditions as the Administrative
Agent may require in its discretion, and the Borrowers shall deliver to the
Custodian any additional Mortgage Loan Documents, as applicable, in connection
with such funding.  Unless the
Administrative Agent notifies the Borrowers in writing of its approval of such
Revolving Loans, the Administrative Agent shall be deemed not to have approved
such request.


 


(c)           Repayment.  Subject to the terms of this Agreement,
Revolving Loans may be borrowed, repaid and reborrowed during the Commitment
Period.  All outstandings under the
Revolving Loans shall be due and payable in full on the Revolver Maturity Date,
unless accelerated sooner pursuant to Section 7.2.  The Borrowers shall have the right to repay
Revolving Loans in whole or in part from time to time; provided, however;
that each partial repayment of a Revolving Loan shall be in a minimum principal
amount of $1,000,000 and integral multiples of $100,000 in excess thereof (or
the remaining outstanding principal amount). Any such repayment will be applied
in accordance with Section 2.5(b) of this Agreement or, as
applicable, the Fee Letter, or, if not specified in Section 2.5 or the Fee
Letter, in such order and manner as determined by the Administrative Agent in
its reasonable discretion.


 


(d)           Interest.  Subject to the provisions of Section 2.6,
Revolving Loans shall bear interest as follows:


 


45

















 


(i)            Alternate Base
Rate Loans.  During such
periods as any Revolving Loans shall be comprised of Alternate Base Rate Loans,
each such Alternate Base Rate Loan shall bear interest at a per annum rate
equal to the sum of the Alternate Base Rate plus the Applicable
Percentage; and


 


(ii)           LIBOR Rate
Loans.  During such periods as
Revolving Loans shall be comprised of LIBOR Rate Loans, each such LIBOR Rate
Loan shall bear interest at a per annum rate equal to the sum of the LIBOR Rate
plus the Applicable Percentage.


 


Interest on Revolving Loans shall be payable in arrears on each Payment
Date.


 


(e)           Revolving
Notes; Covenant to Pay.  The
Borrowers’ obligation to pay each Revolving Lender shall be evidenced by this
Agreement and, upon such Revolving Lender’s request, by a duly executed
promissory note of the Borrowers to such Revolving Lender in substantially the
form of Exhibit 2.1(e).  The
Borrowers covenant and agree to pay the Revolving Loans in accordance with the
terms of this Agreement.


 


(f)            Confirmations.  Notwithstanding anything to the contrary in
this Section 2.1 and notwithstanding any oral or verbal approval of an
Extension of Credit by the Administrative Agent, no Extension of Credit shall
be deemed approved until a Confirmation or revised Confirmation, as applicable,
has been executed by the Administrative Agent. 
Each pledge of a Mortgage Asset, regardless of whether a Loan is made to
the Borrowers in connection therewith, shall be evidenced by a Confirmation.  Each Confirmation, together with this
Agreement, shall constitute conclusive evidence of the terms agreed between the
Administrative Agent and the
applicable Borrower with respect to the Term Loan or Revolving Loan to which
the Confirmation relates, and the applicable Borrower’s acceptance of the
related proceeds shall constitute the applicable Borrower’s agreement to the
terms of such Confirmation.  It is the
intention of the parties that each Confirmation shall not be separate from this
Agreement but shall be made a part of this Agreement.  To the extent of a conflict between this
Agreement and the related Confirmation, the Confirmation shall control.


 


Section 2.2            Term Loan; Delayed Draw Term Loan.


 


(a)           Term Loan.  Subject to the terms and conditions hereof
(including, without limitation, Sections 4.1 and 4.2 of this Agreement) and in
reliance upon the representations and warranties set forth herein, each Term
Loan Lender severally, but not jointly, agrees to make available to the
Borrowers (through the Administrative Agent) on the Restatement Date  such Term Loan Lender’s Term Loan Commitment Percentage of
a term loan in Dollars (the “Term Loan”) in the aggregate principal
amount of TWO HUNDRED FORTY THREE MILLION SEVEN HUNDRED
FIFTY FIVE THOUSAND EIGHT HUNDRED SIXTY THREE DOLLARS AND SIXTY NINE CENTS  ($243,755,863.69),  which amount shall equal the aggregate Allocated Term Loan
Amount approved by the Administrative Agent in its discretion for the Eligible
Assets approved by the Administrative Agent in its discretion and included in
the Term Loan Collateral (as the same may be increased as provided in Section 2.2(b),
the “Term Loan Committed Amount”), for the purposes hereinafter set
forth.  The Term Loan Collateral and the
Allocated Term Loan Amount for each item of Term Loan Collateral shall be
evidenced by Confirmations executed by the applicable Borrower and the
Administrative Agent.  Upon receipt by
the Administrative Agent of the proceeds of the Term Loan, such proceeds will
then be made available to the Borrowers by 5:00 p.m. on the Borrowing Date
by the Administrative Agent by crediting the account of the Borrowers on the
books of the office of the Administrative Agent 


 


46

















 


specified
in Section 10.2, or at such other office as the Administrative Agent may
designate in writing, with the aggregate of such proceeds made available to the
Administrative Agent by the Term Loan Lenders and in like funds as received by
the Administrative Agent (or by crediting such other account(s) as
directed in writing by the Borrowers). 
The Term Loan may consist of Alternate Base Rate Loans or LIBOR Rate
Loans, or a combination thereof, as the Borrowers may request.  LIBOR Rate Loans shall be made by each Term
Loan Lender at its LIBOR Lending Office and Alternate Base Rate Loans at its
Domestic Lending Office.


 


(i)            Repayment of Term Loan.  The terms and provisions governing repayment
of the Term Loan are set forth in Section 2.5(b)(viii).  All outstandings under the Term Loan shall be
due and payable in full on the Term Loan Maturity Date unless accelerated
sooner pursuant to Section 7.2. 
Amounts repaid or prepaid on the Term Loan may not be reborrowed.  Any repayment of the Term Loans will be
applied in accordance with Section 2.5(b) of this Agreement or, as
applicable, the Fee Letter, or, if not specified in Section 2.5 or the Fee
Letter, in such order and manner as determined by the Administrative Agent in
its reasonable discretion.


 


(ii)           Interest on the
Term Loan.  Subject to
the provisions of Section 2.6, the Term Loan shall bear interest as
follows:


 


(A)          Alternate Base
Rate Loans.  During such
periods as the Term Loan shall be comprised of Alternate Base Rate Loans, each
such Alternate Base Rate Loan shall bear interest at a per annum rate equal to
the sum of the Alternate Base Rate plus the Applicable Percentage; and


 


(B)           LIBOR Rate
Loans.  During such periods as the
Term Loan shall be comprised of LIBOR Rate Loans, each such LIBOR Rate Loan
shall bear interest at a per annum rate equal to the sum of the LIBOR Rate plus
the Applicable Percentage.


 


Interest on the Term Loan shall be payable in
arrears on each Payment Date.


 


(iii)          Term Loan
Notes; Covenant to Pay.  The
Borrowers’ obligation to pay each Term Loan Lender shall be evidenced by this
Agreement and, upon such Term Loan Lender’s request, by a duly executed
promissory note of the Borrowers to such Term Loan Lender in substantially the
form of Exhibit 2.2.  The
Borrowers covenant and agree to pay the Term Loan in accordance with the terms
of this Agreement.


 


(b)           Delayed Draw
Term Loan.  Until the
Term Loan Maturity Date and subject to the terms and conditions hereof and in
reliance upon the representations and warranties set forth herein, each Term
Loan Lender severally, but not jointly, agrees to make available to the
Borrowers (through the Administrative Agent) from time to time, in accordance
with clause (b)(i)(C) below, such Term Loan Lender’s Term Loan Commitment
Percentage of a term loan in Dollars (each, a “Delayed Draw Term Loan”)
in the aggregate principal amount, after giving effect to all Delayed Draw Term
Loan borrowings, of up to TWENTY TWO MILLION EIGHT
HUNDRED NINETEEN THOUSAND SIX HUNDRED EIGHTY THREE DOLLARS AND SIXTY CENTS ($22,819,683.60),  which amount shall not exceed the maximum aggregate
Allocated Term Loan Amount for the future fundings approved by the
Administrative Agent in its discretion on Term Loan Collateral identified on
Schedule 1-B to the Fee Letter (the “Delayed Draw Term Loan Committed Amount”),
for the purposes hereinafter set forth. 
A Delayed Draw Term Loan borrowing may consist of Alternate Base Rate
Loans or 


 


47

















 


LIBOR Rate Loans, or a combination thereof, as the Borrower may
request.  Amounts repaid or prepaid on a
Delayed Draw Term Loan may not be reborrowed.


 


(i)            Delayed Draw Term Loan Borrowings.


 


(A)          Notice of
Borrowing.


 


(1)           The Borrowers may request a
Delayed Draw Term Loan for the purpose of financing unfunded future funding
obligations under the Term Loan Collateral approved by the Administrative Agent
in its discretion and identified on Schedule 1-B to the Fee Letter and for no
other purpose; provided that (1) such request is subject to the
Administrative Agents approval in its discretion, (2) before and after
giving effect to such Delayed Draw Term Loan, (i) the aggregate principal
amount of all Delayed Draw Term Loans shall not exceed the Delayed Draw Term
Loan Committed Amount and (ii) the maximum amount of the Delayed Draw Term
Loans that may be funded for a given Pledged Mortgage Asset identified on
Schedule 1-B to the Fee Letter shall not exceed the related “Potential Future
Funding” amount set forth on Schedule 1-B to the Fee Letter, (3) no
Default or Event of Default exists, (4) the Borrowers deliver a Notice of
Borrowing, a Compliance Certificate, the Construction Draw Deliveries and such
other information and documents as the Administrative Agent shall require in
its discretion at least three (3) Business Days prior to the requested
Borrowing Date, (5) to the extent approved by the Administrative Agent,
the Administrative Agent shall notify the Borrowers of the amount of the
Delayed Draw Term Loan so approved and the Borrowers and the Administrative
Agent shall execute one (1) or more amended Confirmations evidencing the
new Allocated Term Loan Amount for the Term Loan Collateral with respect to
which the Administrative Agent has determined to permit such Extension of
Credit, together with such other terms and conditions as the Administrative
Agent may require in its discretion and (6) the Borrowers shall deliver to
the Custodian any additional Mortgage Loan Documents, as applicable, in
connection with such funding.  Unless the
Administrative Agent notifies the Borrowers
in writing of the Administrative Agent’s approval of the requested Delayed Draw
Term Loan, the Administrative Agent shall be deemed not to have approved such
proposed future funding.  The
Administrative Agent in its discretion may waive, shorten or increase any of
the applicable time periods for the review of proposed future fundings  or the delivery of documents in connection therewith.


 


(2)           The delivery of the Confirmation to the
Administrative Agent shall be irrevocable and shall be deemed to be a
certification by the applicable Borrower that, among other things, all
conditions precedent to such Delayed Draw Term Loan set forth in
Articles II and IV  have been
satisfied (except the Administrative Agent’s consent).  Each amended Confirmation, together with this
Agreement, shall constitute conclusive evidence of the terms agreed between the
Administrative Agent and the
applicable Borrower with respect to the Delayed Draw Term Loan and Term Loan to
which the amended 


 


48

















 


Confirmation
relates, and the applicable Borrower’s acceptance of the related proceeds shall
constitute the applicable Borrower’s agreement to the terms of such
Confirmation.  It is the intention of the
parties that each Confirmation shall not be separate from this Agreement but
shall be made a part of this Agreement. 
To the extent of a conflict between this Agreement and the related
Confirmation, the Confirmation shall control.


 


(3)           Once the Confirmation is
executed by the Administrative Agent, the Administrative Agent shall give
notice to each Term Loan Lender at least one (1) Business Day prior to the
Borrowing Date  of each such Term Loan Lender’s
share thereof.


 


(B)           Minimum Amounts.  Each Delayed Draw Term Loan borrowing that is
made as an Alternate Base Rate Loan shall be in a minimum aggregate amount of
$1,000,000 and in integral multiples of $100,000 in excess thereof (or the
remaining amount of the Delayed Draw Term Loan Committed Amount, if less).  Each Delayed Draw Term Loan borrowing that is
made as a LIBOR Rate Loan shall be in a minimum aggregate amount of $1,000,000
and in integral multiples of $100,000 in excess thereof (or the remaining
amount of the Delayed Draw Term Loan Committed Amount, if less).


 


(C)           Advances.  Each Term Loan Lender will make its Term Loan
Commitment Percentage of each Delayed Draw Term Loan borrowing available to the
Administrative Agent for the account of the applicable Borrower at the office
of the Administrative Agent specified in Section 10.2, or at such other
office as the Administrative Agent may designate in writing, by 1:00 p.m.
on the Borrowing Date, in Dollars and in funds immediately available to the
Administrative Agent.  Upon receipt by
the Administrative Agent of the proceeds of the Delayed Draw Term Loan, such
proceeds will then be made available to the applicable Borrower by 5:00 p.m.
on the Borrowing Date by the Administrative Agent by crediting the account of
the applicable Borrower on the books of the office of the Administrative Agent
specified in Section 10.2, or at such other office as the Administrative
Agent may designate in writing, with the aggregate of such proceeds made
available to the Administrative Agent by the Term Loan Lenders and in like
funds as received by the Administrative Agent (or by crediting such other
account(s) as directed in writing by the Borrowers).


 


(ii)           Repayment of
Delayed Draw Term Loan.  Upon
a borrowing of a Delayed Draw Term Loan, the Term Loan Committed Amount shall
be increased to take into account such Delayed Draw Term Loan and the Delayed
Draw Term Loan Committed Amount shall be reduced by the amount of such Delayed
Draw Term Loans.   Any drawn Delayed Draw
Term Loans will constitute a Term Loan hereunder and all terms and conditions
of Section 2.2(a) shall apply to such Delayed Draw Term Loan.


 


(c)           Confirmations.  Notwithstanding anything to the contrary in
this Section 2.2 and notwithstanding any oral or verbal approval of an
Extension of Credit by the Administrative Agent, no Extension of Credit shall
be deemed approved until a Confirmation or revised Confirmation, as applicable,
has been executed by the Administrative Agent. Each pledge of a Mortgage Asset,
regardless of whether a Loan is made to the Borrowers in connection therewith,
shall be evidenced by a Confirmation. 
Each Confirmation, together with this Agreement, shall constitute
conclusive evidence of the terms agreed between the Administrative Agent and the


 


49














 


applicable Borrower with respect to the Term Loan to which the
Confirmation relates, and the applicable Borrower’s acceptance of the related
proceeds shall constitute the applicable Borrower’s agreement to the terms of
such Confirmation.  It is the intention
of the parties that each Confirmation shall not be separate from this Agreement
but shall be made a part of this Agreement. 
To the extent of a conflict between this Agreement and the related
Confirmation, the Confirmation shall control.


 


(d)                                 Deliveries.  The Borrower Asset Schedules, Custodial
Identification Certificates, Trust Receipts, Borrower Release Letters,
Warehouse Lender Release Letters and Servicer Redirection Letters delivered
with respect to the Term Loan Collateral under the Original Agreement and under
the other Credit Documents prior to the Restatement Date shall, notwithstanding
the amendment and restatement of the Agreement and the other Credit Documents
on the Restatement Date, continue to be applicable to all Term Loan Collateral
on and after the Restatement Date with the same force and effect as if such
documents were delivered on the Restatement Date.  All references in the Borrower Asset
Schedules, Custodial Identification Certificates, Trust Receipts, Borrower
Release Letters, Warehouse Lender Release Letters and Servicer Redirection
Letters to the various Credit Documents shall be deemed to refer to the Credit
Documents as amended and restated on the Restatement Date and as subsequently
amended, modified, restated replaced, waived, substituted or extended from time
to time


 


Section 2.3                                   Fees.


 


The Borrowers shall pay all fees provided for in the Fee Letter to the
Administrative Agent for distribution to the Lenders and the Administrative
Agent in accordance therewith.


 


Section 2.4                                   Commitment Reductions.


 


(a)                                  Voluntary
Reductions.  The
Borrowers shall have the right to terminate or permanently reduce the unused
portion of the Revolving Committed Amount and/or the Delayed Draw Term Loan
Committed Amount at any time or from time to time upon not less than five (5) Business
Days’ prior written notice to the Administrative Agent (which shall notify the
Lenders thereof as soon as practicable) of each such termination or reduction,
which notice shall specify the effective date thereof and the amount of any
such reduction which shall be in a minimum amount of $1,000,000 or a whole
multiple of $500,000 in excess thereof and shall be irrevocable and effective
upon receipt by the Administrative Agent; provided that no such
reduction or termination shall be permitted if after giving effect thereto, and
to any prepayments of the Loans made on the effective date thereof, (i) the
sum of the aggregate principal amount of outstanding Revolving Loans would
exceed the Revolving Committed Amount then in effect, (ii) the
Availability would be negative or (iii) the sum of the aggregate principal
amount of outstanding Delayed Draw Term Loans would exceed $22,819,683.60 (i.e.
the initial Delayed Draw Term Loan Committed Amount).


 


(b)                                 Maturity Date.  The Commitments shall automatically terminate
on the Maturity Date unless accelerated sooner pursuant to Section 7.2
hereof.


 


Section 2.5                                   Prepayments.


 


(a)                                  Optional
Prepayments.  The
Borrowers shall have the right to prepay the Term Loans in whole or in part
from time to time; provided, however, that each partial
prepayment of a Term Loan shall be in a minimum principal amount of $1,000,000
and integral multiples of $500,000 in excess thereof (or the remaining
outstanding principal amount).  The
Borrowers shall 


 


50

















 


give
three Business Days’ irrevocable notice of prepayment in the case of LIBOR Rate
Loans and same-day irrevocable notice on any Business Day in the case of
Alternate Base Rate Loans to the Administrative Agent (which shall notify the
Lenders thereof as soon as practicable). 
To the extent that the Borrowers elect to prepay the Term Loans, amounts
prepaid under this Section shall be applied in accordance with Section 2.5
of this Agreement and the Fee Letter, or, if not provided therein, in such
order and manner as determined by the Administrative Agent in its reasonable
discretion.  Within the foregoing
parameters, prepayments under this Section shall be applied first to
Alternate Base Rate Loans and then to LIBOR Rate Loans in direct order of
Interest Period maturities.  All
prepayments under this Section shall be subject to Section 2.13, but
otherwise without premium or penalty. 
Interest on the principal amount prepaid shall be payable on the next
occurring Payment Date that would have occurred had such Loan not been prepaid
or, at the request of the Administrative Agent, interest on the principal
amount prepaid shall be payable on any date that a prepayment is made hereunder
through the date of prepayment.


 


(b)                                 Mandatory
Prepayments.


 


(i)                                     Availability
and Revolving Committed Amount.


 


(A)                              Availability. Subject to
the definition of Asset Value, the Administrative Agent may calculate
Availability on any day.  If the
Availability is negative on any day, as determined by the Administrative Agent
in its discretion, the Borrowers shall, immediately upon notice from the
Administrative Agent and, in any event, within three (3) Business Days
upon notice from the Administrative Agent (the “Availability Correction Deadline”),
prepay the Revolving Loans in cash in an amount determined by the
Administrative Agent so that, after giving effect to such payment, the
Availability will not be negative (each such amount, a “Correction Amount”).


 


(B)                                Revolving Loan
Committed Amount.  If at any
time after the Restatement Date, the sum of the aggregate principal amount of
outstanding Revolving Loans shall (1) exceed the Revolving Committed
Amount or (2) exceed the Available Borrowing Capacity, the Borrowers shall
immediately prepay the Revolving Loans in an amount sufficient to eliminate
such excess.


 


(C)                                Delayed Draw
Term Loan Committed Amount.  If at any time after the Restatement Date,
the sum of the funded Delayed Draw Term Loans shall exceed $22,819,683.60 (i.e.
the initial Delayed Draw Term Loan Committed Amount), the Borrowers shall
immediately prepay the Term Loans in an amount sufficient to eliminate such
excess.


 


(ii)                                  Defaulted
Collateral Prepayment. The terms and provisions governing
mandatory prepayments in connection with a Collateral Default are set forth in
the Fee Letter and are hereby incorporated by reference.


 


(iii)                               Reduction of
Asset Value Prepayment. Subject to the definition of Asset Value,
if, at any time during an Asset Valuation Period,  the
Administrative Agent determines at any time in its discretion that (A) the
Asset Value for any item of Term Loan Collateral is or should be reduced for
any reason in its discretion (other than as excluded in the definition of Asset
Value), the Borrowers shall prepay the outstanding Term Loans, within one (1) Business
Day of the Administrative Agent’s request, in an


 


51

















 


amount equal to the reduction determined by the Administrative Agent, (B) the
Asset Value for any item of Revolving Loan Collateral is or should be reduced
for any reason in its discretion (other than as excluded in the definition of
Asset Value), the Borrowers shall prepay the outstanding Revolving Loans,
within one (1) Business Day of the Administrative Agent’s request, in an
amount equal to the reduction determined by the Administrative Agent and (C) the
Asset Value of all Pledged Mortgage Assets, as determined in the Administrative
Agent’s discretion, is less (including by reason of reductions in the Asset
Value as determined by the Administrative Agent (other than as excluded in the
definition of Asset Value)) than the outstanding principal amount of all Loans
(including Term Loans and Revolving Loans) plus the Note Purchase Margin
(in each case, a “Deficit”), the Borrowers shall prepay the Revolving
Loans and the Term Loans within one (1) Business Day of the Administrative
Agent’s request, in the amount of the Deficit. 
The Administrative Agent’s election, in its discretion, not to deliver
any notice under this clause (iii) shall not in any way limit or impair
its right to deliver such notice at any time. 
Any payments received with respect to clause (A) or (B) shall
be applied to the Pledged Mortgage Asset creating a Deficit and any payment
received with respect to clause (C) shall be applied to the Term Loans,
the Reindeer Debt and/or the Revolving Loans in such order and manner as
determined by the Administrative Agent in its reasonable discretion.


 


(iv)                              Collateral
Release Prepayment.  The terms
and provisions governing mandatory prepayments in connection with repayment,
prepayment reduction or removal of any Collateral are set forth in the Fee
Letter and are hereby incorporated by reference.


 


(v)                                 Issuances of
Debt.  At all times while the
Borrowers are not in compliance with any Bi-Annual Principal Reduction and in
connection with the closing of any Debt Issuance, the Borrowers shall prepay
the Loans, within one (1) Business Day of the closing of any Debt
Issuance,  in an aggregate amount equal
to the greater of (1) 35% of the Net Cash Proceeds of each such Debt
Issuance and (2) the difference between Bi-Annual Principal Reduction
payments that are due and payable and the principal payments that have been
applied to the outstanding principal balance of the Term Loans and the Reindeer
Debt (to the extent positive) (the “Debt Net Cash Proceeds Payment”)
and, in connection therewith, shall, pursuant to Irrevocable Instructions,
cause the Persons obligated to pay such Net Cash  Proceeds
to remit the Debt Net Cash Proceeds Payment by wire transfer in immediately
available funds directly to the Collection Account  on
the closing date of the Debt Issuance instead of paying such amounts to any
Credit Party or a Subsidiary or Affiliate of a Credit Party.  Such prepayment shall be prepaid in
accordance with clause (ix) below.


 


(vi)                              Issuances of
Equity.  (A) At all times while
the Borrowers are not in compliance with any Bi-Annual Principal Reduction and
in connection with the closing of any Equity Issuance,  the Borrowers shall prepay the Loans, within
one (1) Business Day of the closing of any Equity Issuance, in an
aggregate amount equal to the greater of (x) the product of thirty five
percent (35%) and the Net Cash Proceeds of each such Equity Issuance  and (y) the difference between Bi-Annual
Principal Reduction payments that are due and payable and the principal
payments that have been applied to the outstanding principal balance of the
Term Loans and the Reindeer Debt (to the extent positive), and, (B) at all
times while the Borrowers are in compliance with each Bi-Annual Principal
Reduction and in connection with the closing of any Equity Issuance,  the Borrowers shall prepay the Loans, within
one (1) Business Day of the closing of any Equity Issuance, in an
aggregate amount equal the product of ten percent (10%) and the 


 


52

















 


Net
Cash Proceeds of each such Equity Issuance. 
In connection therewith, the Borrowers shall, pursuant to Irrevocable
Instructions, cause the Persons obligated to pay such Net Cash Proceeds to
remit the Equity Net Cash Proceeds Payment by wire transfer in immediately
available funds directly to the Collection Account on the closing date of the
Equity Issuance instead of paying such amounts to any Credit Party or a
Subsidiary or Affiliate of a Credit Party. 
Such prepayment shall be prepaid in accordance with clause (ix) below;
provided, however, that any Net Cash Proceeds received with
respect to an ATM Offering shall be payable no later than three (3) Business
Days following the filing of the related quarterly report made with the SEC.


 


(vii)                           Repayment of
Term Loans.  The
Borrowers shall repay the outstanding principal balance of the Term Loans
(regardless of the source of the principal payments including, without
limitation, mandatory and voluntary prepayments made in accordance with the
terms of this Agreement or the Fee Letter) in the amounts and on or before the
dates described in the definition of Bi-Annual Principal Reduction.  In the event that the Borrowers fail to
comply with any Bi-Annual Principal Reduction and such failure is not cured
within three (3) Business Days, such failure shall constitute an Event of
Default under the Credit Documents.  Any
payments received pursuant to this Section 2.5(b)(vii) shall be
applied in accordance with Section 2.5(b)(ix).


 


(viii)                        Extraordinary
Receipts. 
Immediately, and in any event, within one (1) Business Day upon
receipt by any Credit Party or any of its Subsidiaries of proceeds from any
Extraordinary Receipt, the Borrowers shall prepay the Term Loans and/or the
Revolving Loans, as applicable, in an aggregate principal amount equal to the
lesser of (1) one hundred percent (100%) of such Extraordinary Receipt and
(2) the Allocated Term Loan Amount or Allocated Revolving Loan Amount, as
applicable, to be applied to the Term Loan and/or the Revolving Loans depending
on whether the Extraordinary Receipt is from Term Loan Collateral or Revolving
Loan Collateral.  Such prepayment shall
be prepaid in accordance with clause (ix) below.


 


(ix)                                Application of
Mandatory Prepayments.


 


(1)                                  Unless
otherwise set forth above in Section 2.5(a), Section 2.5(b)(i), (ii),
(iii), (iv), (v) or (vi) or the Fee Letter, all amounts required to
be paid pursuant to this Section, all amounts received by the Administrative
Agent pursuant to Section 4(k) of the Reindeer Note Purchase
Agreement and all other voluntary or involuntary prepayments shall be applied
as follows: (A) first, to the outstanding Term Loans, the Term Loan
Collateral and the Reindeer Debt, in such order and manner as determined by the
Administrative Agent in its reasonable discretion,  in each case until the outstanding principal
amount of the Term Loans and the Reindeer Debt has been paid and full and (B) second,
to the outstanding Revolving Loans and Revolving Loan Collateral in such order
and manner as determined by the Administrative Agent in its reasonable
discretion until the outstanding principal amount of the Revolving Loans has
been paid in full.  Within the parameters
of the applications set forth above, prepayments shall be applied first to
Alternate Base Rate Loans and then to LIBOR Rate Loans in direct order of
Interest Period maturities.  All
prepayments under this Section shall be subject to Section 2.13 and be
accompanied by interest on the principal amount prepaid through the date of
prepayment, but otherwise without premium or penalty; and


 


53

















 


(2)                                  All amounts
required to be paid pursuant to this Section shall be deposited in the
Collection Account and applied at the time of receipt in accordance with this Section or
the Fee Letter and shall be accompanied by any applicable costs incurred
pursuant to Section 2.13 (if any) and any applicable interest payments.


 


Section 2.6                                   Default Rate and Payment
Dates.


 


(a)                                  If all or a
portion of the principal amount of any Loan which is a LIBOR Rate Loan shall
not be paid when due or continued as a LIBOR Rate Loan in accordance with the
provisions of Section 2.7 (whether at the stated maturity, by acceleration
or otherwise), such overdue principal amount of such Loan shall be converted to
an Alternate Base Rate Loan at the end of the Interest Period applicable
thereto.


 


(b)                                 (i) If all
or a portion of the principal amount of any LIBOR Rate Loan shall not be paid
when due, such overdue amount shall bear interest at a rate per annum equal to
the Default Rate or (ii) if any interest payable on the principal amount
of any Loan or any fee or other amount, including the principal amount of any
Alternate Base Rate Loan, payable hereunder shall not be paid when due (whether
at the stated maturity, by acceleration or otherwise), such overdue amount
shall bear interest at a rate per annum equal to the Default Rate, in each case
from the date of such non-payment until such amount is paid in full (after as
well as before judgment).  Upon the
occurrence, and during the continuance, of any Event of Default hereunder, at
the option of the Required Lenders, the principal of and, to the extent permitted
by Requirements of Law, interest on the Loans and any other amounts owing
hereunder or under the other Credit Documents shall bear interest, payable on
demand, at a per annum rate equal to the Default Rate (in each case, after as
well as before judgment).


 


(c)                                  Interest on
each Loan shall be payable in arrears on each Payment Date; provided
that interest accruing pursuant to paragraph (b) of this Section shall
be payable from time to time on demand.


 


Section 2.7                                   Conversion Options.


 


(a)                                  The Borrowers
may, in the case of Revolving Loans and the Term Loan, elect from time to time
to convert Alternate Base Rate Loans to LIBOR Rate Loans or to continue LIBOR
Rate Loans by delivering a Notice of Conversion/Extension to the Administrative
Agent at least three Business Days prior to the proposed date of conversion or
extension, as applicable.  In addition,
the Borrowers may elect from time to time to convert all or any portion of a
LIBOR Rate Loan to an Alternate Base Rate Loan by giving the Administrative
Agent irrevocable written notice thereof by 12:00 p.m. one (1) Business
Day prior to the proposed date of conversion. 
If the date upon which an Alternate Base Rate Loan is to be converted to
a LIBOR Rate Loan is not a Business Day, then such conversion shall be made on
the next succeeding Business Day and during the period from such last day of an
Interest Period to such succeeding Business Day such Loan shall bear interest
as if it were an Alternate Base Rate Loan. 
LIBOR Rate Loans may only be converted to Alternate Base Rate Loans on
the last day of the applicable Interest Period. 
If the date upon which a LIBOR Rate Loan is to be converted to an
Alternate Base Rate Loan is not a Business Day, then such conversion shall be
made on the next succeeding Business Day and during the period from such last
day of an Interest Period to such succeeding Business Day such Loan shall bear
interest as if it were an Alternate Base Rate Loan.  All or any part of outstanding Alternate Base
Rate Loans may be converted as provided herein; provided that (i) no
Loan may be converted into a LIBOR Rate Loan when any Default or Event of
Default has occurred and is 


 


54

















 


continuing and (ii) partial conversions shall be in an aggregate
principal amount of $1,000,000 or a whole multiple of $100,000 in excess
thereof.  All or any part of outstanding
LIBOR Rate Loans may be converted as provided herein; provided that
partial conversions shall be in an aggregate principal amount of $1,000,000 or
a whole multiple of $100,000 in excess thereof.


 


(b)                                 Any LIBOR Rate
Loans may be continued as such upon the expiration of an Interest Period with
respect thereto by compliance by the Borrowers with the notice provisions
contained in Section 2.7(a); provided, that no LIBOR Rate Loan may
be continued as such when any Default or Event of Default has occurred and is
continuing, in which case such Loan shall be automatically converted to an
Alternate Base Rate Loan at the end of the applicable Interest Period with
respect thereto.  So long as no Default
or Event of Default has occurred and is continuing and all conditions set forth
in Section 4.2 have been satisfied and the Borrowers shall fail to give
timely notice of an election to continue a LIBOR Rate Loan, such LIBOR Rate
Loans shall be automatically converted to a one-month LIBOR Rate Loan at the
end of the applicable Interest Period with respect thereto.  To the extent a Default or Event of Default
has occurred and is continuing and the Borrowers shall fail to give timely
notice of an election to continue a LIBOR Rate Loan or the continuation of
LIBOR Rate Loans is not permitted hereunder, such LIBOR Rate Loans shall
automatically be converted to Alternate Base Rate Loans at the end of the
applicable Interest Period with respect thereto.


 


Section 2.8                                   Computation of Interest
and Fees; Usury.


 


(a)                                  Interest
payable hereunder with respect to any Alternate Base Rate Loan based on the
Prime Rate shall be calculated on the basis of a year of 365 days (or 366 days,
as applicable) for the actual days elapsed. 
All other fees, interest and all other amounts payable hereunder shall
be calculated on the basis of a 360-day year for the actual days elapsed.  The Administrative Agent shall as soon as
practicable notify the Borrowers and the Lenders of each determination of a
LIBOR Rate on the Business Day of the determination thereof.  Any change in the interest rate on a Loan
resulting from a change in the Alternate Base Rate shall become effective as of
the opening of business on the day on which such change in the Alternate Base
Rate shall become effective.  The
Administrative Agent shall as soon as practicable notify the Borrowers and the
Lenders of the effective date and the amount of each such change.


 


(b)                                 Each determination
of an interest rate by the Administrative Agent pursuant to any provision of
this Agreement shall be conclusive and binding on the Borrowers and the Lenders
in the absence of manifest error.  The
Administrative Agent shall, at the request of the Borrowers, deliver to the
Borrowers a statement showing the computations used by the Administrative Agent
in determining any interest rate.


 


(c)                                  It is the
intent of the Lenders and the Credit Parties to conform to and contract in
strict compliance with applicable usury law from time to time in effect.  All agreements between the Lenders and the
Credit Parties are hereby limited by the provisions of this subsection which
shall override and control all such agreements, whether now existing or
hereafter arising and whether written or oral. 
In no way, nor in any event or contingency (including, but not limited
to, prepayment or acceleration of the maturity of any Obligation), shall the
interest taken, reserved, contracted for, charged, or received under this Agreement,
under the Notes or otherwise, exceed the maximum nonusurious amount permissible
under Requirements of Law.  If, from any
possible construction of any of the Credit Documents or any other document,
interest would otherwise be payable in excess of the maximum nonusurious
amount, any such construction shall be subject to the provisions of this
paragraph and such interest shall be automatically reduced to the maximum
nonusurious amount permitted under Requirements of Law, without the necessity 


 


55

















 


of execution of any amendment or new document.  If any Lender shall ever receive anything of
value which is characterized as interest on the Loans under Requirements of Law
and which would, apart from this provision, be in excess of the maximum
nonusurious amount, an amount equal to the amount which would have been
excessive interest shall, without penalty, be applied to the reduction of the
principal amount owing on the Loans and not to the payment of interest, or
refunded to the Borrowers or the other payor thereof if and to the extent such
amount which would have been excessive exceeds such unpaid principal amount of
the Loans.  The right to demand payment
of the Loans or any other Indebtedness evidenced by any of the Credit Documents
does not include the right to receive any interest which has not otherwise
accrued on the date of such demand, and the Lenders do not intend to charge or
receive any unearned interest in the event of such demand.  All interest paid or agreed to be paid to the
Lenders with respect to the Loans shall, to the extent permitted by
Requirements of Law, be amortized, prorated, allocated, and spread throughout
the full stated term (including any renewal or extension) of the Loans so that
the amount of interest on account of such Indebtedness does not exceed the
maximum nonusurious amount permitted by Requirements of Law.


 


Section 2.9                                   Pro Rata Treatment and
Payments.


 


(a)                                  Allocation of
Payments Prior to Exercise of Remedies.


 


(i) Each borrowing of
Revolving Loans and any reduction of the Revolving Commitments shall be made
pro rata according to the respective Revolving Commitment Percentages of the
Revolving Lenders.  Each payment on
account of any fees pursuant to Section 2.3 shall be made pro rata in
accordance with the respective amounts due and owing.  Each optional prepayment on account of
principal of the Loans shall be applied in accordance with Sections 2.1(c) and
2.5(a), as applicable.  Each mandatory
prepayment on account of principal of the Loans shall be applied in accordance
with Section 2.5(b) or the Fee Letter, as applicable.  Unless payments are specifically payable to
Revolving Loans, Term Loans or the Reindeer Debt, all payments are shared pari passu and pro rata (based on the amounts of such Loans)
between Revolving Loans and Term Loans. All payments (including prepayments) to
be made by the Borrowers on account of principal, interest and fees shall be
made without defense, set-off or counterclaim and shall be made to the Administrative
Agent for the account of the Lenders at the Administrative Agent’s office
specified on Section 10.2 in Dollars and in immediately available funds
not later than 1:00 p.m. on the date when due.  The Administrative Agent shall distribute
such payments to the Lenders entitled thereto promptly upon receipt in like
funds as received.  If any payment
hereunder (other than payments on the LIBOR Rate Loans) becomes due and payable
on a day other than a Business Day, such payment shall be extended to the next
succeeding Business Day, and, with respect to payments of principal, interest
thereon shall be payable at the then applicable rate during such
extension.  If any payment on a LIBOR
Rate Loan becomes due and payable on a day other than a Business Day, such
payment date shall be extended to the next succeeding Business Day unless the
result of such extension would be to extend such payment into another calendar
month, in which event such payment shall be made on the immediately preceding
Business Day.


 


(ii)                                  The
Administrative Agent as agent for the Secured Parties shall be entitled to
receive an amount equal to all Income paid or distributed on or in respect of
the Collateral, which amount shall be deposited by the Borrowers and any
Servicer or PSA Servicer under a Pooling and Servicing Agreement into the
Collection Account.  The Borrowers hereby
agree to instruct each applicable Servicer to transfer within


 


56

















 


two (2) Business Days of receipt thereof, and each applicable
PSA Servicer under a Pooling and Servicing Agreement to deposit within
two (2) Business Days of the date on which such Person is obligated
under the applicable Pooling and Servicing Agreement to disburse such funds,
all Income with respect to the Collateral directly into the Collection
Account.  On each Payment Date, any Cash
Collateral and any amounts on deposit in the Collection Account shall be
withdrawn by the Administrative Agent and shall be applied as follows:


 


FIRST, pari passu and
pro rata (based on the amounts owed to such Persons under this clause) to the
payment of all fees, expenses, and other obligations then due to the
Administrative Agent and the Lenders pursuant to this Agreement and/or the Fee
Letter, other than the interest and principal on the Loans;


 


SECOND, to the extent not paid by the Borrowers, to the
payment of fees and expenses owed to the Custodian under the Custodial
Agreement or Custodial Fee Letter;


 


THIRD, pari passu and
pro rata (based on the amounts owed to such Persons under this clause) to the
Lenders for the payment of accrued and unpaid interest on the Loans
outstanding;


 


FOURTH, without limiting the Borrowers’ obligations to
make mandatory prepayments under Section 2.5(b) and the Fee Letter in
a timely manner as provided in this Article II or the Fee Letter, pari passu and pro rata (based on the amounts owed to such
Persons under this clause) for the payment of the amounts and Loans provided
for in Section 2.5(b) and the Fee Letter;


 


FIFTH, pari passu and
pro rata (based on the amounts owed to such Persons under this clause) to the
extent any Income or Cash Collateral includes payments or prepayments of
principal on or from any Collateral (including, without limitation, insurance
or condemnation proceeds or recoveries from any foreclosures not otherwise
applied under Section 2.5(b), the Fee Letter or clause FOURTH above), such
payments shall be applied to reduce the Allocated Term Loan Amount and/or
Allocated Revolving Loan Amount for the related Term Loan Collateral or
Revolving Loan Collateral, as applicable;


 


SIXTH, pari passu and
pro rata (based on the amounts owed to such Persons under this clause) to the
extent not previously paid pursuant to Article II, to the Lenders to pay
any other principal payments then due or required to be paid;


 


SEVENTH, pari passu and
pro rata (based on the amounts owed to such Persons under this clause) to the
payment of all other amounts then due and owing to the Administrative Agent,
the Lenders or any other Person pursuant to this Agreement and the other Credit
Documents; and


 


EIGHTH, to the Borrowers, for such purposes as the Borrowers shall determine in their sole
discretion;


 


provided, however,
that if a Default or Event of Default has occurred and is continuing or a
mandatory prepayment under Section 2.5 or the Fee Letter is due but not
yet payable, such amounts under clause “EIGHTH” shall not be transferred to the
Borrowers but shall remain in the Collection Account and applied (i) in
the case of a mandatory prepayment under Section 2.5 or the Fee Letter, in
reduction of 


 


57

















 


such
mandatory prepayments when due and payable, with the balance being remitted to
the Borrowers and (ii) in the case of a Default or Event of Default, in
reduction of the Obligations in accordance with Section 2.9(b).


 


Notwithstanding
anything to the contrary contained herein, in the event any Obligor Reserve
Payments  are deposited into the Collection
Account, such Obligor Reserve Payments  shall, upon
written request of the Borrowers, be promptly transferred from the Collection
Account to the Borrowers for the Borrowers to transfer into the appropriate
escrow or reserve accounts.


 


In
carrying out the foregoing, amounts received shall be applied in the numerical
order provided until exhausted prior to application of the next succeeding
category.


 


(b)                                 Allocation of
Payments After Exercise of Remedies.  Notwithstanding any other provisions of this
Agreement or the other Credit Documents to the contrary, after the exercise of
remedies (other than the invocation of default interest pursuant to Section 2.6)
by the Administrative Agent or the Lenders pursuant to Section 7.2 (or
after the Commitments shall automatically terminate and the Loans (with accrued
interest thereon) and all other amounts under the Credit Documents shall
automatically become due and payable in accordance with the terms of such
Section), all amounts collected or received by the Administrative Agent or any
Lender on account of the Obligations or any other amounts outstanding under any
of the Credit Documents or in respect of the Collateral and all amounts on
deposit in the Collection Account shall be paid over or delivered to the
Administrative Agent and applied as follows (irrespective of whether the
following costs, expenses, fees, interest, premiums, scheduled periodic
payments or Obligations are allowed, permitted or recognized as a claim in any
proceeding resulting from the occurrence of a Bankruptcy Event):


 


FIRST, to the payment of all
reasonable out-of-pocket costs and expenses (including without limitation
reasonable attorneys’ fees) of the Administrative Agent in connection with
enforcing the rights of the Lenders under the Credit Documents and any
protective advances made by the Administrative Agent with respect to the
Collateral under or pursuant to the terms of the Security Documents;


 


SECOND, to the payment of
any fees owed by the Borrowers to the Administrative Agent;


 


THIRD, pari passu
and pro rata (based on the amounts owed to such Persons under this clause) to
the payment of all reasonable out-of-pocket costs and expenses (including
without limitation, reasonable attorneys’ fees) of each of the Lenders in
connection with enforcing its rights under the Credit Documents or otherwise with
respect to the Obligations owing to such Lender;


 


FOURTH pari passu
and pro rata (based on the amounts owed to such Persons under this clause) to
the payment of all of the Obligations consisting of accrued fees and interest;


 


FIFTH pari passu
and pro rata (based on the amounts owed to such Persons under this clause) to
the payment of the outstanding principal amount of the Obligations;


 


SIXTH, pari passu
and pro rata (based on the amounts owed to such Persons under this clause) to
all other Obligations and other obligations which shall have become 


 


58

















 


due and payable under the Credit Documents or otherwise and not repaid
pursuant to clauses “FIRST” through “FIFTH” above; and


 


SEVENTH, pari passu and pro rata (based on the amounts owed to such
Persons under this clause) to the payment of the surplus, if any, to whoever
may be lawfully entitled to receive such surplus.


 


In carrying out the
foregoing, (a) amounts received shall be applied in the numerical order
provided until exhausted prior to application to the next succeeding category;
and (b) each of the Lenders shall receive an amount equal to its pro rata
share (based on the proportion of the then outstanding Loans held by such
Lender) of amounts available to be applied pursuant to clauses “THIRD”, “FOURTH”,
“FIFTH” and “SIXTH” above.


 


Section 2.10                            Non-Receipt of Funds by
the Administrative Agent.


 


(a)                                  Funding by
Lenders; Presumption by Administrative Agent.  Unless the Administrative Agent shall have received
written notice from a Lender prior to the proposed date of any Extension of
Credit that such Lender will not make available to the Administrative Agent
such Lender’s share of such Extension of Credit, the Administrative Agent may
assume that such Lender has made such share available on such date in
accordance with this Agreement and may, in reliance upon such assumption, make
available to the Borrowers a corresponding amount.  In such event, if a Lender has not in fact
made its share of the applicable Extension of Credit available to the
Administrative Agent, then the applicable Lender and the Borrowers severally
agree to pay to the Administrative Agent forthwith on demand such corresponding
amount with interest thereon, for each day from and including the date such
amount is made available to the Borrowers to but excluding the date of payment
to the Administrative Agent, at (i) in the case of a payment to be made by
such Lender, the greater of the Federal Funds Effective Rate and a rate
determined by the Administrative Agent in accordance with banking industry rules on
interbank compensation and (ii) in the case of a payment to be made by the
Borrowers, the interest rate applicable to Alternate Base Rate Loans.  If the Borrowers and such Lender shall pay
such interest to the Administrative Agent for the same or an overlapping
period, the Administrative Agent shall promptly remit to the Borrowers the
amount of such interest paid by the Borrowers for such period.  If such Lender pays its share of the applicable
Extension of Credit to the Administrative Agent, then the amount so paid shall
constitute such Lender’s Loan included in such Extension of Credit.  Any payment by the Borrowers shall be without
prejudice to any claim the Borrowers may have against a Lender that shall have
failed to make such payment to the Administrative Agent.


 


(b)                                 Payments by
Borrowers; Presumptions by Administrative Agent.  Unless the Administrative Agent shall have
received notice from the Borrowers prior to the date on which any payment is
due to the Administrative Agent for the account of the Lenders hereunder that
the Borrowers will not make such payment, the Administrative Agent may assume
that the Borrowers have made such payment on such date in accordance herewith
and may, in reliance upon such assumption, distribute to the Lenders the amount
due.  In such event, if the Borrowers
have not in fact made such payment, then each of the Lenders severally agrees
to repay to the Administrative Agent forthwith on demand the amount so
distributed to such Lender, with interest thereon, for each day from and
including the date such amount is distributed to it to but excluding the date
of payment to the Administrative Agent, at the greater of the Federal Funds
Effective Rate and a rate determined by the Administrative Agent in accordance
with banking industry rules on interbank compensation.


 


59














 


A notice of the Administrative Agent to any Lender or the Borrowers
with respect to any amount owing under subsections (a) and (b) of
this Section shall be conclusive, absent manifest error.


 


(c)                                  Failure to
Satisfy Conditions Precedent.  If any Lender makes available to the
Administrative Agent funds for any Loan to be made by such Lender as provided
in the foregoing provisions of this Article II, and such funds are not
made available to the Borrowers by the Administrative Agent because the
conditions to the applicable Extension of Credit set forth in Article IV
are not satisfied or waived in accordance with the terms thereof, the
Administrative Agent shall return such funds (in like funds as received from
such Lender) to such Lender, without interest.


 


(d)                                 Obligations of
Lenders Several.  The
obligations of the Lenders hereunder to make Term Loans and Revolving Loans,
and to make payments pursuant to Section 10.5(c) are several and not
joint.  The failure of any Lender to make
any Loan, to fund any such participation or to make any such payment under
Sections 8.7 and 10.5(c) on any date required hereunder shall not relieve
any other Lender of its corresponding obligation to do so on such date, and no
Lender shall be responsible for the failure of any other Lender to so make its
Loan, to purchase its participation or to make its payment under Sections 8.7
and 10.5(c).


 


(e)                                  Funding Source.  Nothing herein shall be deemed to obligate
any Lender to obtain the funds for any Loan in any particular place or manner or
to constitute a representation by any Lender that it has obtained or will
obtain the funds for any Loan in any particular place or manner.


 


Section 2.11                            Inability to Determine
Interest Rate.


 


Notwithstanding any other provision of this Agreement, if (a) the
Administrative Agent shall reasonably determine (which determination shall be
conclusive and binding absent manifest error) that, by reason of circumstances
affecting the relevant market, reasonable and adequate means do not exist for
ascertaining the LIBOR Rate for such Interest Period, or (b) the Required
Lenders shall reasonably determine (which determination shall be conclusive and
binding absent manifest error) that the LIBOR Rate does not adequately and
fairly reflect the cost to such Lenders of funding LIBOR Rate Loans that the
Borrowers have requested be outstanding as a LIBOR Tranche during such Interest
Period, the Administrative Agent shall forthwith give telephone notice of such
determination, confirmed in writing, to the Borrowers and the Lenders at least
two (2) Business Days prior to the first day of such Interest
Period.  Unless the Borrowers shall have
notified the Administrative Agent upon receipt of such telephone notice that it
wishes to rescind or modify its request regarding such LIBOR Rate Loans, any
Loans that were requested to be made as LIBOR Rate Loans shall be made as
Alternate Base Rate Loans and any Loans that were requested to be converted
into or continued as LIBOR Rate Loans shall remain as or be converted into
Alternate Base Rate Loans.  Until any
such notice has been withdrawn by the Administrative Agent, no further Loans
shall be made as, continued as, or converted into, LIBOR Rate Loans for the
Interest Periods so affected.


 


Section 2.12                            Yield Protection.


 


(a)                                  Increased Costs
Generally.  If any
Change in Law shall:


 


(i)                                     impose, modify
or deem applicable any reserve, special deposit, compulsory loan, insurance
charge or similar requirement against assets of, deposits with 


 


60

















 


or
for the account of, or credit extended or participated in by, any Lender
(except any reserve requirement reflected in the LIBOR Rate);


 


(ii)                                  subject any
Lender to any tax of any kind whatsoever with respect to this Agreement or any
LIBOR Rate Loan made by it, or change the basis of taxation of payments to such
Lender in respect thereof (except for Indemnified Taxes or Other Taxes covered
by Section 2.14 and the imposition of, or any change in the rate of, any
Excluded Tax payable by such Lender); or


 


(iii)                               impose on any
Lender or the London interbank market any other condition, cost or expense
affecting this Agreement or LIBOR Rate Loans made by such Lender;


 


and
the result of any of the foregoing shall be to increase the cost to such Lender
of making or maintaining any LIBOR Rate Loan (or of maintaining its obligation
to make any such Loan), or to reduce the amount of any sum received or
receivable by such Lender hereunder (whether of principal, interest or any
other amount), then, within five (5) Business Days of a request by such
Lender, the Borrowers will pay to such Lender, such additional amount or
amounts as will compensate such Lender for such additional costs incurred or
reduction suffered.


 


(b)                                 Capital
Requirements.  If any
Lender determines that any Change in Law affecting such Lender or any lending
office of such Lender or such Lender’s holding company, if any, regarding
capital requirements has or would have the effect of reducing the rate of
return on such Lender’s capital or on the capital of such Lender’s holding
company, if any, as a consequence of this Agreement, the Commitments of such
Lender or the Loans made by such Lender, to a level below that which such
Lender or such Lender’s holding company could have achieved but for such Change
in Law (taking into consideration such Lender’s policies and the policies of
such Lender’s holding company with respect to capital adequacy), then from time
to time, but in any event within five (5) Business Days, the Borrowers
will pay to such Lender such additional amount or amounts as will compensate
such Lender or such Lender’s holding company for any such reduction suffered.


 


(c)                                  Certificates
for Reimbursement.  A
certificate of a Lender setting forth the amount or amounts necessary to
compensate such Lender or its holding company, as the case may be, as specified
in paragraph (a) or (b) of this Section and delivered
to the Borrowers shall be conclusive absent manifest error.  The Borrowers shall pay such Lender the
amount shown as due on any such certificate within ten (10) days after
receipt thereof.


 


(d)                                 Delay in
Requests.  Failure or
delay on the part of any Lender to demand compensation pursuant to this Section shall
not constitute a waiver of such Lender’s right to demand such compensation.


 


The
provisions of this Section shall survive the termination of this Agreement
and the payment in full of the Obligations.


 


Section 2.13                            Indemnity; Eurocurrency
Liabilities.


 


(a)                                  The Credit
Parties hereby agree to indemnify each Lender and to hold such Lender harmless
from any actual, out-of-pocket funding loss or expense which each Lender may
sustain or incur as a consequence of (a) the failure by the Borrowers to
pay the principal amount of or interest on any Loan by any Lender in accordance
with the terms hereof, (b) the failure by 


 


61

















 


the
Borrowers to accept a borrowing after the Borrowers have given a notice in
accordance with the terms hereof, (c) default by the Borrowers in making
any prepayment after the Borrowers have given a notice in accordance with the
terms hereof, and/or (d) the making by the Borrowers of a prepayment of a
Loan, or the conversion thereof, on a day which is not the last day of the
Interest Period with respect thereto, in each case including, but not limited
to, any such loss or expense arising from interest or fees payable by any
Lender to lenders of funds obtained by it in order to maintain its Loans
hereunder.  A certificate setting forth
in reasonable detail as to any additional amounts payable pursuant to this Section submitted
by any Lender, through the Administrative Agent, to the Borrowers shall be
conclusive in the absence of manifest error. 
The agreements in this Section shall survive termination of this
Agreement and payment of the Obligations.


 


(b)                                 The Borrowers
shall pay to each Lender, as long as such Lender shall be required to maintain
reserves under Regulation D with respect to “Eurocurrency liabilities” within
the meaning of Regulation D, or under any similar or successor regulation with
respect to Eurocurrency liabilities or Eurocurrency funding, additional
interest on the unpaid principal amount of each LIBOR Loan equal to the actual
costs of such reserves allocated to such LIBOR Loan by such Lender (as
determined by such Lender in good faith, which determination shall be
conclusive), which shall be due and payable on each date on which interest is
payable on such LIBOR Loan, provided the Borrowers shall have received at least
fifteen (15) days prior notice (with a copy to the Administrative Agent) of
such additional interest from such Lender. 
If a Lender fails to give notice fifteen (15) days prior to the relevant
Payment Date, such additional interest shall be due and payable fifteen (15)
days from receipt of such notice.


 


Section 2.14                            Taxes.


 


(a)                                  Payments Free
of Taxes.  Any and all
payments by or on account of any obligation of any Credit Party hereunder or
under any other Credit Document shall be made free and clear of and without
reduction or withholding for any Indemnified Taxes or Other Taxes, provided
that if any Credit Party shall be required by Requirements of Law to deduct any
Indemnified Taxes (including any Other Taxes) from such payments, then (i) the
sum payable shall be increased as necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this Section) the Administrative Agent or any Lender receives an amount equal
to the sum it would have received had no such deductions been made, (ii) such
Credit Party shall make such deductions and (iii) such Credit Party shall
timely pay the full amount deducted to the relevant Governmental Authority in
accordance with Requirements of Law.


 


(b)                                 Payment of
Other Taxes by the Borrowers.  Without limiting the provisions of
paragraph (a) above, the Credit Parties shall timely pay any Other
Taxes to the relevant Governmental Authority in accordance with Requirements of
Law.


 


(c)                                  Indemnification
by the Borrowers.  The Credit
Parties shall indemnify the Administrative Agent and each Lender, within
ten (10) days after demand therefor, for the full amount of any
Indemnified Taxes or Other Taxes (including Indemnified Taxes or Other Taxes
imposed or asserted on or attributable to amounts payable under this Section) paid
by the Administrative Agent or such Lender and any penalties, interest and
reasonable expenses arising therefrom or with respect thereto, whether or not
such Indemnified Taxes or Other Taxes were correctly or legally imposed or
asserted by the relevant Governmental Authority.  A certificate as to the amount of such
payment or liability delivered to the Borrowers by a Lender (with a copy to 


 


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the
Administrative Agent), or by the Administrative Agent on its own behalf or on
behalf of a Lender, shall be conclusive absent manifest error.


 


(d)                                 Evidence of
Payments.  As soon as
practicable after any payment of Indemnified Taxes or Other Taxes by any Credit
Party to a Governmental Authority, the Borrowers shall deliver to the
Administrative Agent 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 the Administrative Agent.


 


(e)                                  Status of
Lenders.  Any Foreign Lender that is
entitled to an exemption from or reduction of withholding tax under the law of
the jurisdiction in which any Credit Party is a resident for tax purposes, or
any treaty to which such jurisdiction is a party, with respect to payments
hereunder or under any other Credit Document shall deliver to the Borrowers
(with a copy to the Administrative Agent), at the time or times prescribed by
Requirements of Law or reasonably requested by the Borrowers or the
Administrative Agent, such properly completed and executed documentation
prescribed by Requirements of Law as will permit such payments to be made
without withholding or at a reduced rate of withholding.  In addition, any Lender, if requested by the
Borrowers or the Administrative Agent, shall deliver such other documentation
prescribed by Requirements of Law or reasonably requested by the Borrowers or
the Administrative Agent as will enable the Borrowers or the Administrative
Agent to determine whether or not such Lender is subject to backup withholding
or information reporting requirements.


 


(f)                                    Foreign Lenders.  Without limiting the generality of the
foregoing, in the event that any Credit Party is resident for tax purposes in
the United States of America, any Foreign Lender shall deliver to the Borrowers
and the Administrative Agent (in such number of copies as shall be requested by
the recipient) on or prior to the date on which such Foreign Lender becomes a
Lender under this Agreement (and from time to time thereafter upon the request
of the Borrowers or the Administrative Agent, but only if such Foreign Lender
is legally entitled to do so), whichever of the following is applicable:


 


(i)                                     duly completed
copies of Internal Revenue Service Form W-8BEN claiming eligibility for
benefits of an income tax treaty to which the United States of America is a
party,


 


(ii)                                  duly completed
copies of Internal Revenue Service Form W-8ECI,


 


(iii)                               in the case of
a Foreign Lender claiming the benefits of the exemption for portfolio interest
under section 881(c) of the Code, (i) a certificate to the effect
that such Foreign Lender is not (A) a “bank” within the meaning of
section 881(c)(3)(A) of the Code, (B) a “10 percent shareholder”
of any Borrower within the meaning of section 881(c)(3)(B) of the
Code, or (C) a “controlled foreign corporation” described in
section 881(c)(3)(C) of the Code and (ii) duly completed copies
of  Internal Revenue Service Form W-8BEN,
or


 


(iv)                              any other form
prescribed by Requirements of Law as a basis for claiming exemption from or a
reduction in United States Federal withholding tax duly completed together with
such supplementary documentation as may be prescribed by Requirements of Law to
permit the Credit Parties to determine the withholding or deduction required to
be made.


 


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(g)                                 Treatment of
Certain Refunds.  If the
Administrative Agent or a Lender determines, in its reasonable discretion, that
it has received a refund of any Taxes or Other Taxes as to which it has been
indemnified by the Borrowers or with respect to which the Credit Parties have
paid additional amounts pursuant to this Section, it shall pay to the Credit
Parties an amount equal to such refund (but only to the extent of indemnity
payments made, or additional amounts paid, by the Credit Parties under this Section with
respect to the Taxes or Other Taxes giving rise to such refund), net of all
out-of-pocket expenses of the Administrative Agent or such Lender, as the case
may be, and without interest (other than any interest paid by the relevant
Governmental Authority with respect to such refund), provided that the
Credit Parties, upon the request of the Administrative Agent or such Lender
agrees to repay the amount paid over to the Credit Parties (plus any penalties,
interest or other charges imposed by the relevant Governmental Authority) to
the Administrative Agent or such Lender, in the event the Administrative Agent
or such Lender is required to repay such refund to such Governmental
Authority.  This paragraph shall not be
construed to require the Administrative Agent, or any Lender to make available
its tax returns (or any other information relating to its taxes that it deems
confidential) to the Credit Parties or any other Person.


 


The
provisions of this Section shall survive the termination of this Agreement
and the payment in full of the Obligations.


 


Section 2.15                            Illegality.


 


Notwithstanding any other provision of this Credit Agreement, if any
Change in Law shall make it unlawful for such Lender or its LIBOR Lending
Office to make or maintain LIBOR Rate Loans as contemplated by this Credit
Agreement or to obtain in the interbank eurodollar market through its LIBOR
Lending Office the funds with which to make such Loans, (a) such Lender
shall promptly notify the Administrative Agent and the Borrowers thereof, (b) the
commitment of such Lender hereunder to make LIBOR Rate Loans or continue LIBOR
Rate Loans as such shall forthwith be suspended until the Administrative Agent
shall give notice that the condition or situation which gave rise to the
suspension shall no longer exist, and (c) such Lender’s Loans then
outstanding as LIBOR Rate Loans, if any, shall be converted on the last day of
the Interest Period for such Loans or within such earlier period as required by
Requirements of Law as Alternate Base Rate Loans.  The Borrowers hereby agree to promptly pay
any Lender, upon its demand, any additional amounts necessary to compensate
such Lender for actual and direct costs (but not including anticipated profits)
reasonably incurred by such Lender in making any repayment in accordance with
this Section including, but not limited to, any interest or fees payable
by such Lender to lenders of funds obtained by it in order to make or maintain
its LIBOR Rate Loans hereunder.  A
certificate (which certificate shall include a description of the basis for the
computation) as to any additional amounts payable pursuant to this Section submitted
by such Lender, through the Administrative Agent, to the Borrowers shall be
conclusive in the absence of manifest error.


 


Section 2.16                            Obligations Absolute.


 


Except
as set forth to the contrary in the Credit Documents, all sums payable by the
Credit Parties hereunder or under the Credit Documents shall be paid without
notice, demand, counterclaim, setoff, deduction or defense (as to any Person or
any reason whatsoever) and without abatement, suspension, deferment, diminution
or reduction (as to any Person or any reason whatsoever), and the obligations
and liabilities of each Credit Party hereunder shall in no way be released,
discharged or otherwise affected (except as expressly provided herein) by
reason of:  (a) any damage to or
destruction of or any taking of any asset, any Property, any Collateral or any
portion of the foregoing; (b) any restriction or prevention of or
interference with any use of any asset, any Property, any Collateral or any
portion of the foregoing; (c) any title defect or encumbrance or any
eviction from any Property, by title paramount or otherwise; 


 


64

















 


(d) any
Insolvency Proceeding relating to any Credit Party, any Affiliate or Subsidiary
of the foregoing or any Obligor, account debtor or indemnitor under the
Collateral, or any action taken with respect to this Agreement or any other
Credit Document by any trustee or receiver of any Credit Party, any Affiliate
or Subsidiary of the foregoing or any Obligor, account debtor or indemnitor
under the Collateral, or by any court, in any such proceeding; (e) any
claim that any Credit Party has or might have against the Administrative Agent,
any Lender and/or any Indemnitee; (f) any default or failure on the part
of the Administrative Agent, any Lender and/or any Indemnitee to perform or
comply with any of the terms hereof, the Credit Documents or of any other
agreement with any Credit Party, any Subsidiary or Affiliate of the foregoing
and/or any other Person; (g) the invalidity or unenforceability of any
Collateral or Loan; (h) anything related to or arising out of any
Credit-Party-Related Obligation; or (i) any other occurrence whatsoever,
whether similar or dissimilar to the foregoing, whether or not any Credit Party
or any Affiliate or Subsidiary of the foregoing shall have notice or knowledge
of any of the foregoing.


 


Section 2.17                            Replacement of Lenders.


 


(a)                                  Designation of
a Different Lending Office.  If any Lender requests compensation under Section 2.12
or Section 2.15, or requires the Borrowers to pay any additional amount to
any Lender or any Governmental Authority for the account of any Lender pursuant
to Section 2.14, then such Lender shall use reasonable efforts to
designate a different lending office for funding or booking its Loans hereunder
or to assign its rights and obligations hereunder to another of its offices,
branches or affiliates, if, in the judgment of such Lender, such designation or
assignment (i) would eliminate or reduce amounts payable pursuant to Section 2.12,
Section 2.14 or Section 2.15, as the case may be, in the future and (ii) would
not subject such Lender to any unreimbursed cost or expense and would not
otherwise be disadvantageous to such Lender. 
The Borrowers hereby agree to pay all reasonable costs and expenses
incurred by any Lender in connection with any such designation or assignment.


 


(b)                                 Replacement of
Lenders.  If any Lender requests
compensation under Section 2.12 or Section 2.15, or if the Borrowers
are required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 2.14, or if
any Lender defaults in its obligation to fund Loans hereunder, then the
Borrowers may, at their sole expense and effort, upon notice to such Lender and
the Administrative Agent, require such Lender to assign and delegate, without
recourse (in accordance with and subject to the restrictions contained in, and
consents required by, Section 10.6), all of its interests, rights and
obligations under this Agreement and the related Credit Documents to an assignee
that shall assume such obligations (which assignee may be another Lender, if a
Lender accepts such assignment), provided that:


 


(i)                                     such Lender
shall have received payment of an amount equal to the outstanding principal of
its Loans, accrued interest thereon, accrued fees and all other amounts payable
to it hereunder and under the other Credit Documents (including any amounts
under Section 2.13) from the assignee (to the extent of such outstanding
principal and accrued interest and fees) or the Borrowers (in the case of all
other amounts);


 


(ii)                                  in the case of
any such assignment resulting from a claim for compensation under Section 2.12
or Section 2.15 or payments required to be made pursuant to Section 2.14,
such assignment will result in a reduction in such compensation or payments
thereafter; and


 


(iii)                               such assignment
does not conflict with Requirements of Law.


 


65

















 


A
Lender shall not be required to make any such assignment or delegation if,
prior thereto, as a result of a waiver by such Lender or otherwise, the
circumstances entitling the Borrowers to require such assignment and delegation
cease to apply.


 


ARTICLE III


 


REPRESENTATIONS AND WARRANTIES


 


To induce the Lenders to enter into this Agreement and to make the
Extensions of Credit herein provided for, the Credit Parties hereby represent
and warrant, as of the date of this Agreement and on any date a Loan is made
hereunder and at all times while any Credit Document or any Loan is in full
force and effect, to the Administrative Agent and to each Lender that:


 


Section 3.1                                   Financial Condition.


 


The
audited consolidated balance sheet of NorthStar Corp and its Consolidated
Subsidiaries as of the fiscal year ending December 31, 2008, provided to
the Administrative Agent and the related audited consolidated statements of
income and retained earnings and of cash flows for the year then ended, setting
forth in each case in comparative form the figures for the previous year,
reported on without a “going concern” or like qualification arising out of the
scope of the audit conducted by Grant Thornton, copies of which have heretofore
been furnished to the Administrative Agent, are complete and correct and
present fairly in all material respects the consolidated financial condition of
NorthStar Corp and its Consolidated Subsidiaries of the foregoing as of such
date, and the consolidated results of their operations and their consolidated
cash flows for the fiscal year then ended. 
All such financial statements, including the related schedules and notes
thereto (if any), have been prepared in accordance with GAAP applied
consistently throughout the periods involved (except as disclosed
therein).  Neither NorthStar Corp nor any
of its Consolidated Subsidiaries had, as of the date of the most recent balance
sheet referred to above, any material contingent liability or liability for
taxes, or any long term lease or unusual forward or long term commitment,
including, without limitation, any interest rate or foreign currency swap or
exchange transaction or other financial derivative, that is not reflected in
the foregoing statements or in the notes thereto.  Except as otherwise disclosed publicly,
during the period from December 31, 2008, to and including the date
hereof, there has been no sale, transfer or other disposition by the Borrowers,
the Guarantor or any Consolidated Subsidiaries of the foregoing of any material
part of their business or Property and no purchase or other acquisition of any
business or Property (including any Equity Interests of any other Person)
material in relation to the consolidated financial condition of the Borrowers,
the Guarantor or any Consolidated Subsidiaries of the foregoing on the date
hereof.


 


Section 3.2                                   No Material Adverse
Effect.


 


Since  December 31, 2008 (and,
in addition, after delivery of annual audited financial statements in
accordance with Section 5.1(a), from the date of the most recently
delivered annual audited financial statements), there has been no development
or event which has had or could reasonably be expected to have a Material
Adverse Effect.


 


Section 3.3                                   Corporate Existence;
Compliance with Law.


 


Each of the Credit Parties (a) is duly organized, validly existing
and in good standing under the laws of the jurisdiction of its incorporation,
organization or formation, (b) has the requisite power and authority and
the legal right to own, operate and pledge all its Property, to lease the
Property it operates as 


 


66

















 


lessee and to conduct the business in which it is currently engaged and
has taken all actions necessary to maintain all rights, privileges, licenses
and franchises necessary or required in the normal conduct of its business, (c) is
duly qualified to conduct business and in good standing under the laws of (i) the
jurisdiction of its organization or formation, (ii) the jurisdiction where
its chief executive office is located and (iii) each other jurisdiction
where its ownership, lease or operation of Property or the conduct of its
business requires such qualification, (d) is in compliance with all
Requirements of Law (including, without limitation, all government permit and
licensing requirements), Authority Documents, government permits and government
licenses and (e) is in material compliance with all Contractual
Obligations, Indebtedness and Guarantee Obligations.  The jurisdiction of incorporation or
organization, as applicable, and the chief executive office of each of the Credit
Parties are listed on Schedule 3.3 along with each Credit Parties
chief executive office.  The Borrowers
shall update Schedule 3.3 from time to time, in accordance with Section 5.2,
to update information and to add Additional Credit Parties.


 


Section 3.4                                   Corporate Power;
Authorization; Enforceable Obligations.


 


Each of the Credit Parties has full power and authority and the legal
right to make, deliver and perform the Credit Documents to which it is party
and has taken all necessary limited liability company, partnership or corporate
action to authorize the execution, delivery and performance by it of the Credit
Documents to which it is party.  Each
Credit Document to which it is a party has been duly executed and delivered on
behalf of each Credit Party.  Each Credit
Document to which it is a party constitutes a legal, valid and binding
obligation of each Credit Party, enforceable against such Credit Party in
accordance with its terms, except as enforceability may be limited by
applicable Insolvency Laws and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).


 


Section 3.5                                   No Legal Bar; No Default.


 


The
execution, delivery and performance by each Credit Party of the Credit
Documents to which such Credit Party is a party, the borrowing of Loans hereunder,
pledge of Collateral under the Credit Documents and the use of the proceeds of
the Loans (a) will not violate any Requirement of Law, (b) will not
conflict with, result in a breach of or constitute a default under Authority
Documents of the Credit Parties or any Contractual Obligation, Indebtedness or
Guarantee Obligations of any Credit Party (except those as to which waivers or
consents were obtained) or any material approval or material consent from any
Governmental Authority relating to such Credit Party, and (c) will not
result in, or require, the creation or imposition of any Lien on any Credit
Party’s Properties or revenues pursuant to any Requirement of Law, Contractual
Obligations, Indebtedness or Guarantee Obligations other than the Liens arising
under or contemplated in connection with the Credit Documents or Permitted
Liens.  No Credit Party is in default
under or with respect to any of its Contractual Obligation, Indebtedness or
Guarantee Obligations in any material respect. 
No Default or Event of Default has occurred and is continuing.


 


Section 3.6                                   No Material Litigation.


 


No
litigation, investigation, claim, criminal prosecution, civil investigative
demand, imposition of criminal or civil fines and penalties, or any other
proceeding of or before any arbitrator or Governmental Authority is pending or,
to the actual knowledge of the Credit Parties, threatened by or against any
Credit Party or any of its Subsidiaries or Affiliates or against any of its or
their respective Properties or revenues (a) with respect to the Credit
Documents, any Extension of Credit, any Collateral or any of the transactions
contemplated hereby, or (b) which could reasonably be expected to have a
Material Adverse Effect.  No permanent
injunction, temporary restraining order or similar decree has been issued
against any Credit Party or any of its Subsidiaries or Affiliates, which could
reasonably be expected to have a Material Adverse Effect.


 


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Section 3.7                                   Investment Company Act;
Federal Power Act; Interstate Commerce Act; and Federal and State Statutes and
Regulations.


 


No
Credit Party is required to register as an “investment company”, or a company “controlled”
by an “investment company”, within the meaning of the 40 Act.  No Credit Party is subject to regulation
under the Federal Power Act, the Interstate Commerce Act, or any federal or
state statute or regulation limiting its ability to incur the Obligations.


 


Section 3.8                                   Margin Regulations.


 


No
part of the proceeds of any Extension of Credit hereunder will be used directly
or indirectly for any purpose that violates, or that would require any Lender
to make any filings in accordance with, the provisions of Regulation T, U
or X of the Board of Governors of the Federal Reserve System as now and
from time to time hereafter in effect. 
The Credit Parties (a) are not engaged, principally or as one of
their important activities, in the business of extending credit for the purpose
of “purchasing” or “carrying” “margin stock” within the respective meanings of
each of such terms under Regulation U and (b) taken as a group do not own “margin
stock”.  No Borrower is subject to any
Requirement of Law that purports to restrict or regulate its ability to borrow
money.


 


Section 3.9                                   ERISA.


 


(a)  No Credit Party has established nor maintained any Plan; and (b) each
Credit Party either (1) qualifies as an Operating Company; (2) complies
with an exception set forth in the Plan Asset Regulations such that the assets
of such Person would not be subject to Title I of ERISA or Section 4975 of
the Internal Revenue Code; or (3) does not hold any Plan Assets that are
subject to ERISA.


 


Section 3.10                            Environmental Matters.


 


Except as could not reasonably be expected to have a
Material Adverse Effect:


 


(a)                                  The Properties
owned, leased or operated by the Credit Parties do not contain any Materials of
Environmental Concern in amounts or concentrations which (i) constitute a
violation of, or (ii) could reasonably give rise to liability on behalf of
any Credit Party under, any Environmental Law.


 


(b)                                 The Properties
and all operations of the Credit Parties at the Properties are in compliance,
and have in the last five years been in compliance, in all material respects
with all applicable Environmental Laws, and none of the Credit Parties and to
the actual knowledge of the Credit Parties, no other Person has caused any
contamination at, under or about the Properties.


 


(c)                                  No Credit Party
has received any written or actual notice of violation, alleged violation,
non-compliance, liability or potential liability on behalf of any Credit Party
with respect to environmental matters or Environmental Laws regarding any of
the Properties, nor do the Credit Parties have actual knowledge or reason to
believe that any such notice will be received or is being threatened.


 


(d)                                 None of the
Credit Parties, and to the actual knowledge of the Credit Parties, no other
Person has transported or disposed of from the Properties in violation of, or
in a manner or to a location that could give rise to liability on behalf of any
Credit Party under any Environmental Law, and no Materials of Environmental
Concern have been generated, treated, 


 


68

















 


stored
or disposed of at, on or under any of the Properties in violation of, or in a
manner that could reasonably be expected to give rise to liability on behalf of
any Credit Party under, any applicable Environmental Law.


 


(e)                                  No judicial
proceeding or governmental or administrative action is pending or, to the
knowledge of the Credit Parties, threatened, under any Environmental Law to
which any Credit Party is or will be named as a party with respect to the
Properties, nor are there any consent decrees or other decrees, consent orders,
administrative orders or other orders, or other administrative or judicial
requirements outstanding under any Environmental Law with respect to the
Properties.


 


(f)                                    There has been
no release or to the actual knowledge of the Credit Parties, threat of release
of Materials of Environmental Concern at or from the Properties, or arising
from or related to the operations of any Credit Party in connection with the
Properties, in violation of or in amounts or in a manner that could give rise
to liability on behalf of any Credit Party under Environmental Laws.


 


Section 3.11                            Use of Proceeds.


 


The proceeds of the Extensions of Credit shall be used by the Borrowers
(a) to acquire or finance Eligible Assets and (b) subject to Section 3.8,
for other general corporate purposes.


 


Section 3.12                            Subsidiaries; Joint
Ventures; Partnerships.


 


The
organizational chart attached as Schedule 3.12 sets forth the name of
each Consolidated Subsidiary of each Credit Party.  The Borrowers are Subsidiaries of the
Guarantors.  The Borrowers do not have
any Subsidiaries.


 


Section 3.13                            Ownership.


 


Each
of the Borrowers is the owner of, and has good and marketable title to or a
valid leasehold interest in, all of its respective Properties that constitute
Collateral.  None of the Collateral is
subject to any Lien other than Permitted Liens.


 


Section 3.14                            Indebtedness.


 


Except
as otherwise permitted under Section 6.1, the Borrowers have no
Indebtedness or Guarantee Obligations. 
To each Borrower’s knowledge, no material defaults or events of default
exist under the Indebtedness permitted under Section 6.1.


 


Section 3.15                            Taxes.


 


Each
of the Credit Parties has filed, or caused to be filed, all income tax returns
and all other material tax returns (federal, state, local and foreign) required
to be filed and paid (a) all amounts of taxes shown thereon to be due
(including interest and penalties) and (b) all other taxes, fees,
assessments and other governmental charges (including mortgage recording taxes,
documentary stamp taxes and intangibles taxes) owing by it, except for such
taxes (i) that are not yet delinquent or (ii) that are being
contested in good faith and by proper proceedings, and against which adequate
reserves are being maintained in accordance with GAAP.  None of the Credit Parties is aware of any proposed
tax assessments against it.


 


69














 


Section 3.16                            Solvency.


 


No
Credit Party is the subject of any Insolvency Proceeding or Insolvency
Event.  The Loans under this Agreement
and any other Credit Document do not and will not render any Credit Party not
Solvent.  The Credit Parties are not entering
into the Credit Documents or any Extension of Credit with the intent to hinder,
delay or defraud any creditor of the Credit Parties or any Subsidiary and the
Credit Parties have received or will receive reasonably equivalent value for
the Credit Documents and each Extension of Credit.


 


Section 3.17                            [Reserved].


 


Section 3.18                            Location.


 


Each
Credit Parties’ location (within the meaning of Article 9 of the UCC) is
set forth on Schedule 3.18.  The
office where each Credit Party keeps all the records (within the meaning of Article 9
of the UCC) is at the address set forth on Schedule 3.18 to this
Agreement (or at such other locations as to which the notice and other
requirements specified in Section 10.2 shall have been satisfied).  Each Credit Party’s organizational
identification number and tax identification number is as set forth in the Fee
Letter.


 


Section 3.19                            No Burdensome Restrictions.


 


None
of the Credit Parties or their Subsidiaries or Affiliates is a party to any
agreement or instrument or subject to any other obligation or any charter or
corporate restriction or any provision of any Requirement of Law which,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.


 


Section 3.20                            Brokers’ Fees.


 


None
of the Credit Parties or their Subsidiaries or Affiliates has any obligation to
any Person in respect of any finder’s, broker’s, investment banking or other
similar fee in connection with any of the transactions contemplated under the
Credit Documents other than the closing and other fees payable pursuant to this
Agreement and as set forth in the Fee Letter.


 


Section 3.21                            [Reserved].


 


Section 3.22                            Accuracy and Completeness
of Information.


 


To
each Credit Parties’ actual knowledge, the information, reports, certificates,
documents, financial statements, books, records, files, exhibits and schedules
furnished in writing by or on behalf of each Credit Party to the Administrative
Agent in connection with the negotiation, preparation or delivery of this
Agreement and the other Credit Documents or included herein or therein or
delivered pursuant hereto or thereto, when taken as a whole, do not contain any
untrue statement of material fact or omit to state any material fact necessary
to make the statements herein or therein, in light of the circumstances under
which they were made, not misleading. 
All written information furnished after the date hereof by or on behalf
of each Credit Party to the Administrative Agent and the Lenders in connection
with this Agreement and the other Credit Documents and the transactions
contemplated hereby and thereby will be true, complete and accurate in every
material respect, or (in the case of projections) based on reasonable
estimates, on the date as of which such information is stated or certified.  There is no fact known to a Responsible
Officer of any Credit Party, after due inquiry, that could reasonably be
expected to have a Material Adverse Effect that has not been disclosed to the
Administrative Agent.  All projections 


 


70

















 


furnished
on behalf of each Credit Party to the Administrative Agent were prepared and
presented in good faith by or on behalf of each Credit Party.


 


Section 3.23                            [Reserved].


 


Section 3.24                            Insurance.


 


Each
Credit Party has and maintains, with respect to its Properties and business,
insurance which meets the requirements of Section 5.5.


 


Section 3.25                            Security Documents.


 


The
Security Documents create valid security interests in, and Liens on, the
Collateral purported to be covered thereby. 
Except as set forth in the Security Documents, such security interests
and Liens are currently (or will be, upon (a) the filing of appropriate
financing statements with the Secretary of State of the state of incorporation
or organization for each Credit Party, in each case in favor of the
Administrative Agent, on behalf of the Lenders, and (b) the Administrative
Agent obtaining control  or possession
over those items of Collateral in which a security interest is perfected
through control or possession) perfected security interests and Liens, prior to
all other Liens other than Permitted Liens. 
None of the Credit Parties nor any Person claiming through or under any
Credit Party shall have any claim to or interest in the Collection Account or
the Security Account Control Agreement, except for the interest of the
Borrowers in such property as a debtor for purposes of the UCC.


 


Section 3.26                            Anti-Terrorism Laws.


 


Neither any Credit Party nor any of its Subsidiaries is
an “enemy” or an “ally of the enemy” within the meaning of Section 2 of
the Trading with the Enemy Act of the United States of America (50 U.S.C. App.
§§ 1 et seq.), as amended.  Neither any Credit Party nor any of their
Subsidiaries is in violation of (a) the Trading with the Enemy Act, as
amended, (b) any of the foreign assets control regulations of the United
States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) or
any enabling legislation or executive order relating thereto or (c) the
Patriot Act.  None of the Credit Parties
or any Subsidiary of any Credit Party (i) is a blocked person
described in Section 1 of the Anti-Terrorism Order or (ii) to the
best of its knowledge, engages in any dealings or transactions, or is otherwise
associated, with any such blocked person.


 


Section 3.27                            Compliance with OFAC Rules and
Regulations.


 


(a)                                  None of the
Credit Parties or their Subsidiaries is in violation of and shall not violate
any of the country or list based economic and trade sanctions administered and
enforced by OFAC that are described or referenced at
http://www.ustreas.gov/offices/enforcement/ofac/ or as otherwise published from
time to time.


 


(b)                                 None of the
Credit Parties or their Subsidiaries (i) is a Sanctioned Person or a
Sanctioned Entity, (ii) has a more than 10% of its assets located in
Sanctioned Entities, or (iii) derives more than 10% of its operating
income from investments in, or transactions with Sanctioned Persons or
Sanctioned Entities.  The proceeds of any
Loan will not be used and have not been used to fund any operations in, finance
any investments or activities in or make any payments to, a Sanctioned Person
or a Sanctioned Entity.


 


71

















 


Section 3.28                            Compliance with FCPA.


 


Each
of the Credit Parties and their Subsidiaries is in compliance with the Foreign
Corrupt Practices Act, 15 U.S.C. §§ 78dd-1, et seq., and
any foreign counterpart thereto.  None of
the Credit Parties or their Subsidiaries has made a payment, offering, or
promise to pay, or authorized the payment of, money or anything of value (a) in
order to assist in obtaining or retaining business for or with, or directing
business to, any foreign official, foreign political party, party official or
candidate for foreign political office, (b) to a foreign official, foreign
political party or party official or any candidate for foreign political
office, and (c) with the intent to induce the recipient to misuse his or
her official position to direct business wrongfully to such Credit Party or its
Subsidiary, its Affiliates or to any other Person, in violation of the Foreign
Corrupt Practices Act, 15 U.S.C. §§ 78dd-1, et seq.


 


Section 3.29                            Consent; Governmental
Authorizations.


 


No
approval, consent or authorization of, filing with, notice to or other act by
or in respect of, any Governmental Authority or any other Person is required in
connection with acceptance of Extensions of Credit by the Borrowers or the
making of the Guaranty or with the execution, delivery or performance of any
Credit Document by the Credit Parties (other than those which have been
obtained) or with the validity or enforceability of any Credit Document against
the Credit Parties (except such filings as are necessary in connection with the
perfection of the Liens created by such Credit Documents).


 


Section 3.30                            Bulk Sales.


 


The
execution, delivery and performance of this Agreement, the Credit Documents and
the transactions contemplated hereby do not require compliance with any “bulk
sales” act or similar law by any Credit Party.


 


Section 3.31                            Income and Required
Payments.


 


Each
Credit Party acknowledges that all Income and Required Payments received, after
the Restatement Date, by it or its Affiliates or its Subsidiaries or any Person
acting on its behalf with respect to the Collateral shall be held for the
benefit of the Administrative Agent until deposited into the Collection Account
as required herein.


 


Section 3.32                            Full Payment.


 


No
Credit Party has any knowledge of any fact that should lead it to expect that
each Loan will not be paid in full.


 


Section 3.33                            Irrevocable Instructions.


 


The
Borrowers have delivered each Irrevocable Instruction required to be delivered
by the terms of this Agreement.  The
Credit Parties are not aware of any Required Payment that has been made after
the date of this Agreement but has not been deposited into the Collection
Account.  No Irrevocable Instruction
violates any Requirement of Law, any Contractual Obligation or other
prohibition and such Irrevocable Instructions are the valid and binding
obligations of the parties thereto.


 


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Section 3.34                            Compliance with Covenants.


 


The
Credit Parties are in full compliance with the Financial Covenants and all
Credit Parties are in full compliance with all other applicable covenants,
duties and agreements contained in the Credit Documents.


 


Section 3.35                            Collateral Agreements.


 


The
Credit Parties have delivered to the Administrative Agent or the Custodian all
documents and agreements related to, governing or affecting the Collateral,
including, without limitation, the Mortgage Loan Documents, the Servicer
Agreements, the Pooling and Servicing Agreements and all public documents
relating to any Debt Issuance or Equity Issuance, and, to the best of the
Borrowers’ knowledge, no material default or event of default exists
thereunder.


 


Section 3.36                            No Reliance.


 


Each
Credit Party has made its own independent decisions to enter into the Credit
Documents and each Loan and as to whether such Loan is 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.  No Credit Party is relying
upon any advice from the Administrative Agent or any Lender as to any aspect of
the Loans, including, without limitation, the legal, accounting or tax
treatment of such Loans.


 


Section 3.37                            Collateral.


 


(a) There
are no outstanding rights, options, warrants or agreements for the purchase,
sale or issuance of the Collateral created by, through, or as a result of any
Credit Party’s actions or inactions; (b) there are no agreements on the
part of any Credit Party to issue, sell or distribute the Collateral, other
than this Agreement and the Credit Documents; and (c) no Credit Party has
any obligation (contingent or otherwise) to purchase, redeem or otherwise
acquire any securities or any interest therein or to pay any dividend or make
any distribution in respect of the Collateral, except, in the case of (a) and
(b), for purchase rights that may be contained in any applicable intercreditor
agreement included in the Mortgage Asset File.


 


Section 3.38                            REIT Status.


 


Subject
to Section 5.20, NorthStar Corp qualifies as a REIT and is listed on and
is in good standing with a national recognized securities exchange.


 


Section 3.39                            Insider.


 


No
Credit Party is 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 any Lender, of a bank holding
company of which any Lender is a Subsidiary, or of any Subsidiary of a bank
holding company of which any Lender is a Subsidiary, of any bank at which any
Lender maintains a correspondent account or of any Lender which maintains a
correspondent account with any Lender.


 


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Section 3.40                            No Defenses.


 


To
the actual knowledge of the Credit Parties, there are no defenses, offsets,
counterclaims, abatements, rights of rescission or other claims, legal or
equitable, available to any Credit Party with respect to this Agreement, the
Credit Documents, the Collateral or any other instrument, document and/or
agreement described herein or in the other Credit Documents, or with respect to
the obligation of the Credit Parties to repay the Obligations or any other
obligation under the Credit Documents.


 


Section 3.41                            Warrant Agreements, Etc.


 


Northstar Corp hereby represents and warrants that (a) the Warrant
Agreements and all of the outstanding shares of common stock under the Warrant
Agreements, when issued and paid for upon exercise of the Warrant Agreements in
accordance with the terms thereof, will have been duly and validly authorized
and issued and will be fully paid and nonassessable and will have been offered,
issued, sold and delivered to the holder in compliance with applicable
Securities Laws; (b) the offer and sale of the Warrant Agreements and the
common stock to be issued to the holder upon exercise of the Warrant Agreements
in accordance with the terms thereof, are not required to be registered
pursuant to Section 5 of the Securities Act or any other Securities Laws;
and (c) neither Northstar Corp nor any agent on its behalf has solicited
or will solicit any offers to sell or has offered to sell or will offer to sell
all or any part of the Warrant Agreements (or the common stock to be issued upon
exercise of the Warrant Agreements) so as to bring the issuance of the Warrant
Agreements within the registration provisions of the Securities Act or any
other Securities Laws.


 


Section 3.42                            Value Given.


 


To
the extent a Borrower acquired Mortgage Assets, such Borrower shall have given
reasonably equivalent value to each transferor in consideration for such
transfer to such Borrower, no such transfer shall have been made for or on
account of an antecedent debt owed by the transferor thereunder to such Borrower,
and no such transfer is or may be voidable or subject to avoidance under any
section of the Bankruptcy Code.


 


Section 3.43                            Separateness.


 


As
of the date hereof, each Borrower is in compliance with the requirements of Section 5.24.


 


Section 3.44                            Qualified Transferees.


 


With
respect to each Mortgage Asset, each Borrower and any national bank are “qualified
transferees”, “qualified institutional lenders” or “qualified lenders”
(however, such terms are phrased or denominated) under the terms of the applicable
Mortgage Loan Documents with respect to each party’s ability to hold and/or to
be a pledgee and/or transferee of each such Mortgage Asset.  The Assignments and the pledge of the
Mortgage Assets to the Administrative Agent, on behalf of the Lenders, do not
violate any provisions of the underlying Mortgage Loan Documents, subject to
any post-pledge obligations set forth in such Mortgage Loan Documents.


 


Section 3.45                            Eligibility of Mortgage
Assets.


 


With
respect to each Mortgage Asset, such asset is an Eligible Asset and, except as
disclosed to the Administrative Agent in a Confirmation, the eligibility
criteria under Schedule 1.1(c) is true and correct in all material
respects, except as disclosed to the Administrative Agent.


 


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Section 3.46                            Ability to Perform.


 


None
of the Credit Parties believes, or has any reason or cause to believe, that it
cannot perform each and every agreement, duty, obligation and covenant
contained in the Credit Documents applicable to it and to which it is a
party.  None of the Credit Parties is
subject to any restriction which would unduly burden its ability to timely and
fully perform each and every applicable covenant, duty, obligation and
agreement contained in the Credit Documents and/or the Mortgage Loan
Documents.  None of the Credit Parties is
a party to any agreement or instrument or subject to any restriction which
could reasonably be expected to have a Material Adverse Effect.


 


Section 3.47                            Certain Tax Matters.


 


Each
Borrower represents and warrants, and acknowledges and agrees, that it does not
intend to treat the Loans and the related transactions hereunder as being a “reportable
transaction” (within the meaning of United States Treasury Department
Regulation Section 1.60114).  In the
event a Borrower determines to take any action inconsistent with such
intention, it will promptly notify the Administrative Agent and the
Lenders.  If a Borrower so notifies the
Administrative Agent and the Lenders, the Borrowers acknowledge and agree that
the Administrative Agent and the Lenders may treat the Loans as part of a
transaction that is subject to United States Treasury Department Regulation Section 301.61121,
and the Administrative Agent and the Lenders will maintain the lists and other
records required by such Treasury Regulation.


 


Section 3.48                            Set-Off, etc.


 


No
Collateral has been compromised, adjusted, extended, satisfied, subordinated,
rescinded, set-off or modified by the Credit Parties or, to the Credit Party’s
actual knowledge, any obligor thereof, and no Collateral is subject to
compromise, adjustment, extension (except as set forth in the related documents
provided to the Administrative Agent), satisfaction, subordination, rescission,
set-off, counterclaim, defense, abatement, suspension, deferment, deduction,
reduction, termination or modification, whether arising out of transactions
concerning the Collateral or otherwise, by the Credit Parties or, to the Credit
Party’s actual knowledge, any obligor with respect thereto.


 


Section 3.49                            Interest Rate Protection
Agreements.


 


The
Borrowers and the Guarantors represent and warrant that no “default” has
occurred or is continuing under any Interest Rate Protection Agreement to which
it is a party.


 


Section 3.50                            Representations and
Warranties.


 


The representations and warranties contained herein, required by or
identified in this Agreement and the other Credit Documents and the review and
inquiries made on behalf of the Credit Parties in connection therewith have all
been made by Persons having the requisite expertise, knowledge and background
to provide such representations and warranties. 
On the Borrowing Date for each Extension of Credit and on each day that
Collateral remains subject to this Agreement and the Credit Documents, the
Credit Parties shall be deemed to restate and make each of the representations
and warranties made by it in this Article III of this Agreement.


 


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ARTICLE IV


 


CONDITIONS PRECEDENT


 


Section 4.1                                   Conditions to Restatement
Date.


 


This
Agreement shall become effective upon, and the obligation of each Lender to
continue the Term Loans and to make the initial Revolving Loans (if any) on the
Restatement Date, is subject to, the satisfaction of the following conditions
precedent:


 


(a)                                  Execution of
Credit Agreement; Credit Documents and Lender Consents.  The Administrative Agent shall have received (i) counterparts
of this Agreement, executed by a duly authorized officer of each party hereto, (ii) for
the account of each Revolving Lender requesting a promissory note, a Revolving
Note, (iii) for the account of each Term Loan Lender requesting a
promissory note, a Term Loan Note, (iv) counterparts of the Security
Documents, in each case conforming to the requirements of this Agreement and
executed by duly authorized officers of the Credit Parties or other Person, as
applicable, (vi) counterparts of any other Credit Document, executed by
the duly authorized officers of the parties thereto and (vii) to the
extent Lenders other than Wachovia become party to this Agreement on the
Restatement Date, executed consents, in the form of Exhibit 4.1(a),
from each such Lender authorizing the Administrative Agent to enter this Credit
Agreement on its behalf.


 


(b)                                 Authority
Documents.  The
Administrative Agent shall have received the following:


 


(i)                                     Authority
Documents.  Original
certified Authority Documents of each Credit Party certified (A) by a
Responsible Officer of such Credit Party (pursuant to the Closing Officer’s
Certificate) as of the Restatement Date to be true and correct and in force and
effect as of such date, and (B) in the case of the articles of
incorporation, certificates of formation or other Authority Documents filed
with a Governmental Authority, to be true and complete as of a recent date
by the appropriate Governmental Authority of the state of its incorporation or
organization, as applicable.


 


(ii)                                  Resolutions.  Copies of resolutions of the board of
directors or comparable managing body of each Credit Party approving and
adopting the Credit Documents, the transactions contemplated therein and
authorizing execution and delivery thereof, certified by a Responsible Officer
of such Credit Party (pursuant to the Closing Officer’s Certificate) as of the
Restatement Date to be true and correct and in force and effect as of such
date.


 


(iii)                               Good Standing.  Original certificates of good standing,
existence or its equivalent with respect to each Credit Party certified as of a
recent date by the appropriate Governmental Authorities of the state of
incorporation or organization and each other state in which the failure to so
qualify and be in good standing could reasonably be expected to have a Material
Adverse Effect.


 


(iv)                              Incumbency.  An incumbency certificate of each Credit
Party certified by a Responsible Officer (pursuant to the Closing Officer’s
Certificate) to be true and correct as of the Restatement Date.


 


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(c)                                  Legal Opinions
of Counsel.  The
Administrative Agent shall have received one (1) or more Opinions of
Counsel (including, if requested by the Administrative Agent, local counsel
opinions) of counsel for the Credit Parties, dated the Restatement Date and
addressed to the Administrative Agent and the Lenders, in form and substance
reasonably acceptable to the Administrative Agent (which shall include, without
limitation, opinions with respect to the due organization and valid existence
of each Credit Party, the enforceability of the Credit Documents, opinions as to
perfection of the Liens granted to the Administrative Agent pursuant to the
Security Documents and opinions as to the non-contravention of the Credit
Parties’ organizational documents and material contracts).


 


(d)                                 Personal
Property Collateral.  The Administrative
Agent shall have received, in form and substance satisfactory to the
Administrative Agent:


 


(i)                                     (A) searches
of UCC filings in the jurisdiction of incorporation or formation, as
applicable, of each Credit Party, copies of the financing statements on file in
such jurisdictions and evidence that no Liens exist (or the same have been
appropriately terminated) other than Permitted Liens and (B) tax lien,
judgment and pending litigation searches, the results of which shall be
acceptable to the Administrative Agent in its discretion;


 


(ii)                                  completed UCC
financing statements for each appropriate jurisdiction as is necessary, in the
Administrative Agent’s discretion, to perfect the Administrative Agent’s
security interest in the Collateral;


 


(iii)                               to the extent
applicable, stock or membership certificates, if any, evidencing the Equity
Interests pledged to the Administrative Agent pursuant to the Pledge Agreements
and duly executed in blank undated stock or transfer powers;


 


(iv)                              duly executed
consents as are necessary, in the Administrative Agent’s discretion, to perfect
the Lenders’ security interest in the Collateral;


 


(v)                                 all Instruments
and chattel paper in the possession of any of the Credit Parties, together with
allonges or assignments as may be necessary or appropriate to perfect the
Administrative Agent’s and the Lenders’ security interest in the Collateral;


 


(vi)                              the Account
Control Agreement and the Securities Account Control Agreement; and


 


(vii)                           if applicable,
executed control agreements necessary to perfect any Collateral where the
perfection thereof is by control.


 


(e)                                  Existing
Indebtedness of the Borrowers.  All of the existing Indebtedness for borrowed
money of the Borrowers (other than Indebtedness permitted to exist pursuant to Section 6.1)
shall be repaid in full and all security interests related thereto shall be
terminated on or prior to the Restatement Date.


 


(f)                                    Account
Designation Notice.  The
Administrative Agent shall have received the executed Account Designation
Notice in the form of Exhibit 1.1(a) hereto.


 


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(g)                                 Extensions of
Credit.  With respect to the Term Loans
and any Revolving Loans to be made on the Restatement Date, the Borrowers shall
have satisfied all of the conditions precedent set forth in Section 4.2.


 


(h)                                 Consents.  The Administrative Agent shall have received
evidence that all boards of directors, governmental, shareholder and material
third party consents and approvals necessary in connection with the
Transactions have been obtained and all applicable waiting periods have expired
without any action being taken by any authority that could restrain, prevent or
impose any material adverse conditions on such transactions or that could seek
or threaten any of the foregoing.


 


(i)                                     Compliance with
Laws.  The financings and other
Transactions contemplated hereby shall be in compliance with all Requirements
of Law (including all applicable Securities Laws and banking laws, rules and
regulations).


 


(j)                                     Bankruptcy.  There shall be no Insolvency Proceedings
pending with respect to any Credit Party.


 


(k)                                  Closing Officer’s
Certificate.  The
Administrative Agent shall have received a Closing Officer’s Certificate
executed by a Responsible Officer of each of the Credit Parties as of the
Restatement Date, substantially in the form of Exhibit 4.1(n) or
such other form as is acceptable to the Administrative Agent.


 


(l)                                     Financial
Statements.  The
Administrative Agent and the Lenders shall have received copies of the
financial statements referred to in Section 3.1, as filed with the SEC.


 


(m)                               No Material
Adverse Change.  No Material
Adverse Effect shall have occurred.


 


(n)                                 [Reserved].


 


(o)                                 Patriot Act
Certificate.  At least
five (5) Business Days prior to the Restatement Date,  the Administrative Agent shall have received a certificate
satisfactory thereto, substantially in the form of Exhibit 4.1(o),
for benefit of itself and the Lenders, provided by the Credit Parties that sets
forth information required by the Patriot Act including, without limitation,
the identity of the Credit Parties, the name and address of the Credit Parties
and other information that will allow the Administrative Agent or any Lender,
as applicable, to identify the Credit Parties in accordance with the Patriot
Act.


 


(p)                                 Reindeer
Facility.  The
Administrative Agent shall have received counterparts of the Second Amendment
to Note Purchase Agreement and Repurchase Documents, dated as of the
Restatement Date, entered into in connection with the Reindeer Facility,
executed by a duly authorized officer of each party thereto and all conditions
precedent to such amendment and restatement shall have been satisfied.


 


(q)                                 Power of
Attorney. The Administrative Agent shall have received duly
executed powers of attorney in the form attached as Exhibit 4.1(q)(i) and
Exhibit 4.1(q)(i), as applicable, from each Borrower and each
Pledgor under a Pledge Agreement.


 


(r)                                    Fees and
Expenses.  The
Administrative Agent and the Lenders shall have received all fees and expenses,
if any, owing pursuant to the Fee Letter and Section 2.3.


 


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(s)                                  Additional
Matters.  All other documents and legal
matters in connection with the transactions contemplated by this Agreement and
the other Credit Documents shall be reasonably satisfactory in form and
substance to the Administrative Agent and its counsel.


 


Section 4.2                                   Conditions to All
Extensions of Credit.


 


(a) The obligation of each Lender to make any Extension of Credit
hereunder, including the obligation of each Lender to make the Term Loan on the
Restatement Date and (b) the pledge by any Borrower of any Collateral, in
each case is subject to the following conditions:


 


(a)                                  Representations
and Warranties.  The
representations and warranties made by the Credit Parties herein, in the Credit
Documents, in any schedule to the Credit Documents, in the Mortgage Documents
and which are contained in any certificate, document, report or notice
furnished at any time under or in connection herewith or the other Credit
Documents shall (i) with respect to representations and warranties that
contain a materiality qualification, be true and correct and (ii) with
respect to representations and warranties that do not contain a materiality
qualification, be true and correct in all material respects, in each case on
and as of the date of such Extension of Credit as if made on and as of such
date.


 


(b)                                 No Default or
Event of Default.  No Default
or Event of Default shall have occurred and be continuing on such date or after
giving effect to the Extension of Credit to be made on such date unless such
Default or Event of Default shall have been waived in accordance with this
Agreement.


 


(c)                                  Compliance with
Commitments.  Before and
immediately after giving effect to the making of any Revolving Loan (and the
application of the proceeds thereof), (i) the sum of the aggregate principal
amount of outstanding Revolving Loans shall not exceed  the
Revolving Committed Amount then in effect, (ii) the Availability shall not
be negative and (iii) the aggregate principal amount of outstanding
Revolving Loans would not exceed the Available Borrowing Capacity.  Before and immediately after giving effect to
the making of any Delayed Draw Term Loan (and the application of the proceeds
thereof), the sum of all Term Loans drawn as Delayed Draw Term Loans shall not
exceed $22,819,683.60 (i.e. the initial Delayed Draw Term Loan Committed
Amount).  Before and immediately after
giving effect to the making of any Term Loan (and the application of the
proceeds thereof), the sum of the aggregate principal amount of the outstanding
Term Loans shall not exceed the Term Loan Committed Amount.


 


(d)                                 Additional
Conditions to Revolving Loans.  If a Revolving Loan is requested, all
requirements and conditions set forth in Section 2.1 or other applicable
Sections of this Agreement shall have been satisfied.


 


(e)                                  Requirement of
Law.  No Requirement of Law shall
prohibit or render it unlawful, and no order, judgment or decree of
Governmental Authority shall prohibit, enjoin or render it unlawful, to enter
into such Extension of Credit in accordance with the provisions hereof or any
other transaction contemplated herein.


 


(f)                                    Confirmation.  The Borrowers shall have delivered a
Confirmation, via Electronic Transmission, in accordance with the procedures
set forth in Sections 2.1 and 2.2, and the Administrative Agent shall have
determined that the Mortgage Asset described in such Confirmation is an
Eligible Asset, shall have approved in writing in its discretion the pledge of
the related Eligible Asset (which approval shall be evidenced by the
Administrative Agent’s execution of the related Confirmation) and shall have
obtained all necessary internal credit and 


 


79

















 


other
approvals for such Extension of Credit. 
With respect to requirements for additional Revolving Loans on existing
Revolving Loan Collateral under Section 2.1(b)(iv), all requirements and
conditions of such Section are satisfied.


 


(g)                                 Compliance
Certificate. The Administrative Agent shall have received a
Compliance Certificate in the form of Exhibit 1.1(i) from a
Responsible Officer of the Credit Parties.


 


(h)                                 Due Diligence.  Subject to the Administrative Agent’s right
to perform one or more Due Diligence Reviews pursuant to Section 10.27,
the Administrative Agent shall have completed its due diligence review of the
Mortgage Asset File and the Underwriting Package for each Mortgage Asset and
such other documents, records, agreements, instruments, mortgaged properties or
information relating to such Mortgage Asset as the Administrative Agent in its
discretion deems appropriate to review and such review shall be satisfactory to
the Administrative Agent in its discretion.


 


(i)                                     Servicing
Agreements.  With
respect to any Eligible Asset to be pledged hereunder on the related Borrowing
Date that is not serviced by a Borrower, the applicable Borrower shall have
provided to the Administrative Agent copies of the related Servicing Agreements
and the Pooling and Servicing Agreements, certified as true, correct and
complete copies of the originals, together with Servicer Redirection Notices
fully executed by the applicable Borrower and the Servicer or PSA Servicer, as
applicable, or such other evidence satisfactory to the Administrative Agent in
its discretion that the applicable Servicer or PSA Servicer has been instructed
to deliver all Income with respect to the Collateral to the Collection Account,
which instructions may not be modified without the Administrative Agent’s prior
written consent.


 


(j)                                     Fees and
Expenses.  The
Administrative Agent shall have received all fees and expenses of the
Administrative Agent, the Lenders and counsel to the Administrative Agent due
hereunder and under the Fee Letter and, to the extent the Borrowers are
required hereunder to reimburse the Administrative Agent for such amounts, the
Administrative Agent shall have received the reasonable costs and expenses
incurred by them in connection with the entering into of any Extension of
Credit hereunder, 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 the
Administrative Agent’s option, may be withheld from the sale proceeds of any
Extension of Credit hereunder.


 


(k)                                  Material
Adverse Change. There shall not have occurred a material adverse
change in the financial condition of the Administrative Agent or any Lender
that affects (or can reasonably be expected to affect) materially and adversely
the ability of the Administrative Agent or any Lender to fund its obligations
under this Agreement and no Material Adverse Effect shall have occurred.


 


(l)                                     Trust Receipt. For each Non—Table
Funded Mortgage Asset, the Administrative Agent shall have received from the
Custodian on or before each Borrowing Date a Trust Receipt (along with a
completed Mortgage Asset File Checklist attached thereto) and an Asset Schedule
and Exception Report with respect to the Basic Mortgage Asset Documents for
each Eligible Asset, in each case dated the Borrowing Date, duly completed and,
in the case of the Asset Schedule and Exception Report, with exceptions
acceptable to the Administrative Agent in its discretion in respect of Eligible
Assets to be pledged hereunder on such Business Day.  In the case of a Table Funded Mortgage Asset,
the Administrative Agent shall have 


 


80

















 


received
on the related Borrowing Date the Table Funded Trust Receipt and all other
items described in the second (2nd) sentence of Subsection 2.1(b)(6), each
in form and substance satisfactory to the Administrative Agent in its
discretion, provided that the Administrative Agent subsequently receives the
items described in Subsections 2.1(b)(4) and (6) and the other
delivery requirements under the Custodial Agreement on or before the date and
time specified herein and therein, which items shall be in form and substance
satisfactory to the Administrative Agent in its discretion.  In the case of Term Loans, the Custodian
shall have possession of all Mortgage Loan Documents for the Term Loan
Collateral and the Administrative Agent shall be in receipt of Trust Receipts
for the Term Loan Collateral and all other conditions under the Custodial
Agreement are satisfied with respect to such Term Loan Collateral.


 


(m)                               Release Letters.  The Administrative Agent shall have received
from the applicable Borrower a Warehouse Lender’s Release Letter (or such other
form acceptable to the Administrative Agent), if applicable, or a Borrower’s
Release Letter (or such other form acceptable to the Administrative Agent)
covering each Eligible Asset to be pledged to the Administrative Agent.


 


(n)                                 Covenants and
Agreements.  On and as
of such day, the Credit Parties and the Custodian shall have performed all of
the covenants and agreements and satisfied all other conditions contained in
the Credit Documents to be performed or satisfied by such Person on or prior to
such day.


 


(o)                                 Instructions.  The Administrative Agent shall have received
evidence satisfactory to the Administrative Agent that, in connection with any
Required Payment, the payor thereof has been instructed to deliver the Net Cash
Proceeds to the Collection Account, which instructions may not be modified
without the prior written consent of the Administrative Agent, and the Borrowers
shall have delivered all notices and instructions and obtained all
certifications, acknowledgments, agreements and registrations required to
perfect any CMBS Security.


 


(p)                                 Certificates of
Good Standing.  If
applicable and to the extent required for the Administrative Agent or any
Lender to assert its rights with respect to an Eligible Asset, a certification
of good standing for the Borrowers in each jurisdiction where the Underlying
Mortgaged Property is located.


 


(q)                                 Additional
Borrowers. To the extent there are additional Borrowers other
than the initial Borrowers, the additional Borrowers shall each deliver to the
Administrative Agent a duly executed power of attorney in the form attached as Exhibit 4.1(q)(i),
a Joinder Agreement in form and substance satisfactory to the Administrative
Agent in its discretion and all other agreements, documents, certifications,
UCC financing statements and Opinions of Counsel required of the Borrowers
hereunder at the Restatement Date or under the Joinder Agreement.


 


(r)                                    Control
Agreements. With respect to any Mortgage Asset or collateral
for a Mortgage Asset that is an uncertificated security (as defined in the
UCC), securities entitlement (as defined in the UCC) or is held in a securities
account (as defined in the UCC), the Borrower shall provide to the
Administrative Agent a control agreement, which shall be acceptable to the
Administrative Agent in its discretion and shall be delivered to the Custodian
under the Custodial Agreement, executed by the issuer of the Mortgage Asset or
the collateral for the Mortgage Asset or the related securities intermediary
(as defined in the UCC), as applicable, granting control (as defined in the
UCC) of such Mortgage Asset or collateral for such Mortgage Asset to the
Administrative Agent and providing that, after an Event of Default, the
Administrative agent shall be entitled to notify the issuer or securities
intermediary, as applicable, that such issuer or 


 


81

















 


securities
intermediary shall comply exclusively with the instructions or entitlement
orders (as defined in the UCC), as applicable, of the Administrative Agent
without the consent of the Borrower or any other Person and no longer follow
the instructions or entitlement orders, as applicable, of the Borrower or any
other Person (other than the Administrative Agent).  All of the Borrowers’ right, title and
interest in the Mortgage Assets that constitute CMBS Securities shall be
pledged to the Administrative Agent on the applicable Borrowing Date.  The Borrowers shall deliver to the Custodian
on behalf of the Administrative Agent as agent for the Lenders a complete set
of all transfer documents to be completed by the Administrative Agent as agent
for the Lenders and executed copies of any transfer documents to be completed
by the applicable Borrower, in either case in blank, but in form sufficient to
allow transfer and registration of such Mortgage Assets to the Administrative
Agent as agent for the Lenders no later than the proposed Borrowing Date for
the relevant Mortgage Asset, and such CMBS Securities shall be medallion
guaranteed.  All transfers of
certificated securities from the Borrowers to the Administrative Agent as agent
for the Lenders shall be effected by physical delivery to the Custodian of the
Mortgage Assets (duly endorsed by the applicable Borrower, in blank), together
with a stock power executed by the applicable Borrower, in blank.  With respect to Mortgage Assets that shall be
delivered through the DTC or the National Book Entry System of the Federal
Reserve or any similar firm or agency, as applicable, in book—entry form and
credited to or otherwise held in an account, the Borrowers shall take such
actions necessary to provide instruction to the relevant financial institution,
clearing corporation, securities intermediary or other entity to effect and
perfect a legally valid delivery of the relevant interest granted herein to the
Administrative Agent as agent for the Lenders hereunder to be held in the
Securities Account.  Mortgage Assets
delivered in book—entry form shall be under the custody of and held in the name
of the Administrative Agent as agent for the Lenders in the Securities Account.


 


(s)                                  Consents.  Any and all consents, approvals and waivers
applicable to the Collateral shall have been obtained.


 


(t)                                    Custodial
Agreement Insurance.  The
Administrative Agent shall be in receipt of the evidence of insurance (if any)
required by Section 9.1 of the Custodial Agreement.


 


(u)                                 Pledge
Provisions.  To the
extent the Mortgage Loan Documents for the related Eligible Asset contain
notice, cure and other provisions in favor of a pledgee of the Eligible Asset
under a repurchase or warehouse facility, the applicable Borrower shall provide
evidence to the Administrative Agent that the applicable Borrower has given
notice to the applicable Persons of the Administrative Agent’s interest in such
Eligible Asset and otherwise satisfied any other applicable requirements under
such pledgee provisions so that the Administrative Agent is entitled to receive
the benefits and exercise the rights of a pledgee under the terms of such
pledgee provisions contained in the related Mortgage Loan Documents.


 


(v)                                 Mandatory
Prepayments.  There shall
be no mandatory prepayments outstanding or payable but not yet due.


 


(w)                               Notice of
Borrowing.  The
Administrative Agent shall have received a Notice of Borrowing with respect to
the Loans to be made on each Borrowing Date, together with all other documents,
agreements or instruments required by Article II.


 


(x)                                   Conveyance from
Affiliate.  In
connection with the conveyance of any Mortgage Asset from an Affiliate of a
Borrower to a Borrower prior to the time a Mortgage Asset becomes a Pledged
Mortgage Asset hereunder, the Administrative Agent shall have received (i) evidence
of the filing of UCC financing statements naming the respective Affiliate as
debtor and the 


 


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applicable
Borrower as secured party and identifying the applicable Mortgage Asset as
collateral, (ii) evidence of the filing a UCC-3 financing statement
assigning the UCC financing statement referenced in clause (i) to the
Administrative Agent, and (iii) a true sale opinion with respect to such
conveyance from an Affiliate of a Borrower to a Borrower, which opinion shall
be acceptable to the Administrative Agent in its discretion.


 


(y)                                 Documents,
Reports, Certifications, Etc.  The Administrative Agent shall have received
all such other and further documents, reports, certifications, approvals and
opinions of Counsel as the Administrative Agent in its discretion shall
reasonably require.


 


The
failure of any Credit Party, as applicable, to satisfy any of the foregoing
conditions precedent in respect of any Extension of Credit shall, unless such
failure was expressly waived in writing by the Administrative Agent on or prior
to the related Borrowing Date, give rise to a right of the Administrative
Agent, which right may be exercised at any time on the demand of the
Administrative Agent, to rescind the related Extension of Credit and direct the
Borrowers to pay to the Administrative Agent as agent for the Lenders an amount
equal to the outstanding principal amount of such Extension of Credit, accrued
interest and other amounts due in connection therewith during any such time
that any of the foregoing conditions precedent were not satisfied.


 


Each request for an Extension of Credit and each acceptance by the
Borrowers of any such Extension of Credit shall be deemed to constitute
representations and warranties by the Credit Parties as of the date of the
request and as of the date of such Extension of Credit that the conditions set
forth in Sections 4.1 and 4.2 have been satisfied.


 


ARTICLE V


 


AFFIRMATIVE COVENANTS


 


Each of the Credit Parties hereby covenants and agrees that on the
Restatement Date, and thereafter (a) for so long as this Agreement is in
effect, (b) until the Commitments have terminated, and (c) until no
Note remains outstanding and unpaid and the Obligations and all other amounts
owing to the Administrative Agent or any Lender hereunder are paid in full,
such Credit Party shall, and shall cause each of their Subsidiaries (other than
in the case of Sections 5.1 or 5.2 hereof), to:


 


Section 5.1                                   Financial Statements.


 


Furnish to the Administrative
Agent and each of the Lenders:


 


(a)                                  Annual
Financial Statements.  As soon as
available, and in any event within ninety (90) days after the end of each
fiscal year of the Borrowers and the Guarantors, the audited (in the case of
the Guarantors) or the signed (in the case of the Borrowers) consolidated
balance sheets of the Borrowers, the Guarantors and their Consolidated
Subsidiaries as at the end of such fiscal year and the related consolidated
statements of income and retained earnings and of cash flows for the Borrowers, the Guarantors and their
Consolidated Subsidiaries for such year, and, in the case of the Guarantors
only, setting forth in each case in comparative form the figures for the
previous year, accompanied by an opinion thereon of independent certified
public accountants of recognized national standing, which opinion shall not be
qualified as to scope of audit or going concern and shall state that said
consolidated financial statements fairly present in all material respects the
consolidated financial condition and results of operations of the Borrowers, the 


 


83

















 


Guarantors
and their Consolidated Subsidiaries as at the end of, and for, such fiscal year
in accordance with GAAP;


 


(b)                                 Quarterly Financial
Statements.  As soon as
available, and in any event within forty-five (45) calendar days after the
end of the first three (3) fiscal quarters of the Borrowers and the
Guarantors, the unaudited consolidated and consolidating balance sheets of the
Borrowers, the Guarantors and their Consolidated Subsidiaries as at the end of
such period and the related unaudited consolidated statements of income and
retained earnings and of cash flows for the Borrowers, the Guarantors and their
Consolidated Subsidiaries for such period and the portion of the fiscal year
through the end of such period, accompanied by a certificate of a Responsible
Officer, which certificate shall
state that said consolidated financial statements fairly present in all
material respects the consolidated financial condition and results of
operations of the Borrowers, the Guarantors and their Consolidated Subsidiaries
in accordance with GAAP, consistently applied, as at the end of, and for, such
period (subject to normal year-end adjustments);


 


(c)                                  Obligor
Operating Statement and Rent Rolls. With respect to each
Mortgage Asset, if provided to the Borrowers, the Guarantors or any Servicer or
PSA Servicer by any Obligor under any Mortgage Asset, as soon as available, but
in any event not later than forty—five (45) days after the end of each fiscal
quarter of the Borrowers, the operating statement and rent roll for each
Underlying Mortgaged Property; provided, however, the
Administrative Agent reserves the right in its discretion to request such information
on a monthly basis (to be provided no later than thirty (30) days after
the end of each month) but the Borrowers’ failure to obtain such information
shall not be a breach of this covenant provided the related Mortgage Asset with
respect to which information was not provided is included in the Collateral for
less than six (6) months;


 


(d)                                 Obligor Balance
Sheet.  With respect to each Mortgage
Asset, if provided to the Borrowers or the Guarantors by any Obligor under the
terms of the Mortgage Loan Documents for a Mortgage Asset, as soon as
available, but in any event not later than thirty (30) days after receipt
thereof, the annual balance sheet with respect to such Obligor; and


 


(e)                                  Securitization
Report.  With respect to each Mortgage
Asset, as soon as available but in any event not later than thirty (30)
days after receipt thereof, (A) the related monthly securitization report,
if any, and any other reports delivered under the Pooling and Servicing
Agreements to the Borrowers or the Guarantors, if any, and, (B) within
forty—five (45) days after the end of each quarter, a copy of the standard
monthly exception report (if any), prepared by the Borrowers in the ordinary
course of its business in respect of the related Mortgage Asset or Underlying
Mortgaged Property;


 


all
such financial statements to be complete and correct in all material respects
(subject, in the case of interim statements, to normal recurring year-end audit
adjustments) and to be prepared in reasonable detail and, in the case of the annual
and quarterly financial statements provided in accordance with
subsections (a) and (b) above, in accordance with GAAP applied
consistently throughout the periods reflected therein, provided that any
financial statements delivered with respect to an Obligor under any Mortgage
Asset may be delivered to the Administrative Agent in the form received.


 


Notwithstanding
the foregoing, financial statements and reports required to be delivered
pursuant to the foregoing provisions of this Section may be delivered by
Electronic Transmission and if so, shall be deemed to have been delivered on
the date on which the Administrative Agent receives such reports from 


 


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the
Borrowers through electronic mail; provided that, upon the
Administrative Agent’s request, the Borrowers shall provide paper copies of any
documents required hereby to the Administrative Agent.


 


Section 5.2                                   Certificates; Other
Information.


 


Furnish to the
Administrative Agent and each of the Lenders:


 


(a)                                  [Reserved].


 


(b)                                 Compliance
Certificate. 
Concurrently with the delivery of the financial statements referred to
in Sections 5.1(a) and (b) and in connection with the delivery
of each Notice of Borrowing and each Extension of Credit a Compliance Certificate
from a Responsible Officer of each Credit Party, which Compliance Certificate
shall, among other things, on a quarterly basis describe in detail the
calculations supporting the Responsible Officer’s certification of the
Borrowers’ and the Guarantors’ compliance with the Financial Covenants.


 


(c)                                  Updated
Schedules. 
Concurrently with or prior to the delivery of the financial statements
referred to in Sections 5.1(a) and 5.1(b) above, an updated
copy of Schedule 3.3 and Schedule 3.12 if the Borrowers
or any of their Subsidiaries have formed or acquired a new Subsidiary since the
Restatement Date or since such Schedule was last updated, as applicable.


 


(d)                                 [Reserved].


 


(e)                                  Reports. Within
thirty (30) days of the end of each calendar quarter, the Borrowers shall
provide the Administrative Agent with a quarterly report, which report shall
include, among other items, a summary of the Borrowers’ delinquency and loss
experience with respect to Mortgage Assets serviced by the Borrowers, any
Servicer, any PSA Servicer or any designee of the foregoing, the Borrowers’
internal risk rating, the Borrowers’ and any Servicer’s or any PSA Servicer’s
surveillance reports on the Mortgage Assets, and the operating statements, the
occupancy status and other property level information with respect to each
Mortgage Asset, (B) within ten (10) days of receipt thereof by the
Borrowers, any Servicer or PSA Servicer, any remittance reports with respect to
the servicing of any Collateral and (C) promptly, any such additional
reports as the Administrative Agent may reasonably request with respect to the
Borrowers, any Servicer or PSA Servicer servicing the portfolio, or pending
originations of Mortgage Assets.


 


(f)                                    Mortgage Asset
Data Summary.  No later
than the fifteenth (15th) day of each month, with respect to each Mortgage
Asset, a Mortgage Asset Data Summary, substantially in the form of Exhibit 5.2(f) (“Mortgage
Asset Data Summary”), properly completed.


 


(g)                                 Mortgage Assets.  The Borrowers shall promptly deliver or cause
to be delivered to the Administrative Agent (i) any report or material
notice received by the Borrowers from any Obligor or obligor under the
Collateral promptly following receipt thereof and (ii) any other such
document or information relating to the Collateral as the Administrative Agent
may reasonably request in writing from time to time.


 


(h)                                 Underwriting
Package.  Promptly, any modifications or
additions to the items contained in the Underwriting Package.


 


(i)                                     General
Information. Promptly, such additional financial and other
information as the Administrative Agent or any Lender may from time to time
reasonably request.


 


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Section 5.3                                   Payment of Taxes and Other
Obligations.


 


Pay, discharge or otherwise satisfy at or before maturity or before
they become delinquent, as the case may be, subject, where applicable, to
specified grace periods, (a) all of its taxes (Federal, state, local and
any other Taxes) and (b) all of its other obligations and liabilities of
whatever nature in accordance with industry practice and (c) any
additional costs that are imposed as a result of any failure to so pay,
discharge or otherwise satisfy such Taxes, obligations and liabilities, except
when the amount or validity of any such Taxes, obligations and liabilities are
currently being contested in good faith by appropriate proceedings and
reserves, if applicable, in conformity with GAAP with respect thereto have been
provided on the books of the Credit Parties.


 


Section 5.4                                   Conduct of Business and
Maintenance of Existence.


 


Continue to engage in business of the similar general type as now
conducted by it on the Restatement Date and preserve, renew and keep in full
force and effect its corporate or other formative existence and good standing,
take all action to maintain all rights, privileges, licenses and franchises
necessary, required or desirable in the normal conduct of its business and to
maintain its goodwill and comply with all Contractual Obligations and
Requirements of Law.


 


Section 5.5                                   Maintenance of Property;
Insurance.


 


(a)                                  Keep all
material Property useful and necessary in its business in good working order
and condition (ordinary wear and tear and obsolescence excepted).


 


(b)                                 Maintain with
financially sound and reputable insurance companies liability, casualty,
property and business interruption in at least such amounts and against at
least such risks as are usually insured against in the same general area by
companies engaged in the same or a similar business; and furnish to the
Administrative Agent, upon the request of the Administrative Agent, full
information as to the insurance carried.


 


Section 5.6                                   Inspection of Property;
Books and Records; Discussions.


 


Keep proper books, records and accounts in which full, true and correct
entries in conformity with GAAP and all Requirements of Law shall be made of
all dealings and transactions in relation to its businesses and activities; and
permit, during regular business hours and upon reasonable notice by the
Administrative Agent or any Lender, the Administrative Agent or any Lender to
visit and inspect any of its properties and examine and make abstracts from any
of its books and records at any reasonable time and as often as may reasonably
be desired, and to discuss the business, operations, properties, financial
conditions and other conditions of the Credit Parties and their Subsidiaries
and Affiliates with officers and employees of the Credit Parties and their
Subsidiaries and Affiliates and with its independent certified public accountants.


 


Section 5.7                                   Notices.


 


Give notice in writing to the Administrative Agent (which shall
promptly transmit such notice to each Lender):


 


(a)                                  promptly, but
in any event within two (2) Business Days after any Credit Party
knows thereof, the occurrence of any Default or Event of Default;


 


86

















 


(b)                                 promptly, (i) any
default or event of default under any Contractual Obligation, Indebtedness or
Guarantee Obligation of any Credit Party which, individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect or
involve a monetary claim in excess of $250,000 with respect to any Borrower and
$1,000,000 with respect to any Guarantor, or (ii) any material default or
event of default (beyond any applicable notice and cure period) related to any
Collateral or Required Payment;


 


(c)                                  promptly, any
litigation, or any investigation or proceeding known or threatened to any
Credit Party (i) affecting any Credit Party which, individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect or
involve a monetary claim in excess of $250,000 with respect to any Borrower and
$1,000,000 with respect to any Guarantor or involving injunctions or requesting
injunctive relief by or against any Credit Party, (ii) affecting or with
respect to this Agreement, any other Credit Document, any security interest or
Lien created under any Security Document, any Collateral or any Required
Payment, or (iii) by any Governmental Authority relating to the Credit
Parties and alleging fraud, deception or willful misconduct by such Person;


 


(d)                                 promptly upon
notice or knowledge thereof, notice that any eligibility criteria set forth in Schedule
1.1(c) to this Agreement is or was not satisfied in any material
respect any time;


 


(e)                                  of any
attachment, judgment, levy or order exceeding $250,000 with respect to any
Borrower and $1,000,000 with respect to any Guarantor that may be assessed
against or threatened against any Credit Party, or of any Lien or claim
asserted against any Collateral, other than Permitted Liens;


 


(f)                                    [Reserved];


 


(g)                                 promptly, any
notice of any violation received by any Credit Party from any Governmental
Authority including, without limitation, any notice of violation of Environmental
Laws; and


 


(h)                                 promptly upon
notice or knowledge thereof, notice of any change in NorthStar’s status as a
REIT or membership or good standing on any recognized securities exchange;


 


(i)                                     promptly upon
notice or knowledge thereof, notice of the termination of any Servicer under
any Servicing Agreement relating to any Collateral or of any PSA Servicer under
any Pooling and Servicing Agreement;


 


(j)                                     [Reserved];


 


(k)                                  with respect to
any Collateral hereunder, promptly upon receipt of notice or knowledge that the
Underlying Mortgaged Property has been damaged by waste, fire, earthquake or
earth movement, flood, tornado or other casualty, or otherwise damaged so as to
affect materially adversely the Asset Value of such Collateral;


 


(l)                                     promptly upon
notice or knowledge thereof, provide written notice to the Administrative Agent
of any loss or expected loss in the value of any Collateral, any Required
Payment, any Property or asset of any Credit Party (to the extent that such
loss with respect to any such Property or asset could reasonably be expected to
have a Material Adverse Effect), or any other event or change in circumstances
or expected event or change in circumstances that could reasonably be expected
to result (A) in a default with respect to any Mortgage Asset 


 


87

















 


included in the Collateral, or (B) in a material decline in value
or cash flow of any Collateral, any Underlying Mortgaged Property for any
Collateral, any Required Payment or any Property or asset of a Credit Party (to
the extent that such event or change with respect to any such Property or asset
could reasonably be expected to have a Material Adverse Effect);


 


(m)                               promptly (and,
in any event, within two (2) Business Days) upon notice or knowledge
thereof, provide written notice to the Administrative Agent if any Mortgage
Asset becomes the subject of a Collateral Default; and


 


(n)                                 promptly, any
other development or event which could reasonably be expected to have a
Material Adverse Effect.


 


Each notice pursuant to this Section shall be accompanied by a
statement of a Responsible Officer setting forth details of the occurrence
referred to therein and stating what action the Credit Parties propose to take
with respect thereto.  In the case of any
notice of a Default or Event of Default, the Borrowers shall specify that such
notice is a Default or Event of Default notice on the face thereof.


 


Section 5.8                                   Environmental Laws.


 


(a)                                  Except as could
not reasonably be expected, either individually or in the aggregate, to have a
Material Adverse Effect, comply with, and ensure compliance in all material
respects by all tenants and subtenants, if any, with, all applicable
Environmental Laws and obtain and comply with and maintain, and ensure that all
tenants and subtenants obtain and comply with and maintain, any and all
licenses, approvals, notifications, registrations or permits required by
applicable Environmental Laws;


 


(b)                                 Except as could
not reasonably be expected, either individually or in the aggregate, to have a
Material Adverse Effect, conduct and complete all investigations, studies,
sampling and testing, and all remedial, removal and other actions required
under Environmental Laws and promptly comply with all lawful orders and
directives of all Governmental Authorities regarding Environmental Laws except
to the extent that the same are being contested in good faith by appropriate
proceedings; and


 


(c)                                  Defend,
indemnify and hold harmless the Administrative Agent and the Lenders, and their
respective employees, agents, officers and directors and affiliates, from and
against any and all claims, demands, penalties, fines, liabilities,
settlements, damages, costs and expenses of whatever kind or nature known or
unknown, contingent or otherwise, arising out of, or in any way relating to the
violation of, noncompliance with or liability under, any Environmental Law
applicable to the operations of the Credit Parties or any of their Subsidiaries
or the Properties, or any orders, requirements or demands of Governmental
Authorities related thereto, including, without limitation, reasonable attorney’s
and consultant’s fees, investigation and laboratory fees, response costs, court
costs and litigation expenses, except to the extent that any of the foregoing
arise out of the gross negligence or willful misconduct of the party seeking
indemnification therefor.  The provisions
of this Section shall survive the termination of this Agreement and the
payment in full of the Obligations.


 


Section 5.9                                   Financial Covenants.


 


The
Borrowers and the Guarantors, as applicable, shall comply with the following
Financial Covenants:


 


88














 


(a)                                  Maintenance of
Liquidity.  For each
Test Period, Northstar Corp shall not permit its unrestricted cash or
unrestricted Cash Equivalents for such Test Period to be less than $15,000,000.


 


(b)                                 Maintenance of
Tangible Net Worth.  For each
Test Period, NorthStar Corp shall not permit Northstar Corp’s and its
Consolidated Subsidiaries’ Tangible Net Worth at any time to be less than
$675,000,000.


 


(c)                                  Interest
Coverage.  For each
Test Period, the Borrowers shall not permit the ratio of (A) the sum of
Consolidated Adjusted EBITDA for all Borrowers for such Test Period to (B) Interest
Expense for all Borrowers for such Test Period to be less than 1.15 to 1.0.


 


(d)                                 Leverage Ratio.  For each Test Period, Northstar Corp shall
not permit the ratio of (A) Northstar Corp’s and its Consolidated
Subsidiaries’ Adjusted Total Liabilities to (B) Northstar Corp’s and its
Consolidated Subsidiaries’ Adjusted Total Assets to exceed 0.90 to 1.00.


 


Section 5.10                            Additional Credit Parties.


 


(a)                                  Additional
Borrowers. To the extent any new Borrower is approved by the
Administrative Agent, in its discretion, the Credit Parties shall deliver to
the Administrative Agent, with respect to each new Borrower to the extent
applicable, substantially the same documentation required pursuant to Sections
4.1 and 5.12 and such other documents or agreements as the Administrative Agent
may reasonably request, including without limitation a Borrower Joinder
Agreement.


 


(b)                                 Additional
Guarantors.  To the
extent any new Guarantor is approved by the Administrative Agent, in its
discretion, the Credit Parties shall deliver to the Administrative Agent, with
respect to each new Guarantor to the extent applicable, substantially the same
documentation required pursuant to Sections 4.1 and 5.12 and such other documents
or agreements as the Administrative Agent may reasonably request, including
without limitation a Guarantor Joinder Agreement.


 


Section 5.11                            Compliance with Law.


 


(a)                                  Comply with all
Requirements of Law (including Environmental Laws) and all applicable
restrictions imposed by all Governmental Authorities, applicable to it and the
Collateral.


 


(b)                                 Comply in all
material respects with all Contractual Obligations, all Indebtedness and all
Guarantee Obligations.


 


Section 5.12                            Pledged Assets.


 


With
respect to the Collateral, the Credit Parties shall (a) at the
Administrative Agent’s request, take all action necessary to perfect, protect
and more fully evidence the Administrative Agent’s first priority perfected
security interest in the Collateral, including, without limitation, (i) executing
or causing to be executed such instruments, notices or control agreements as
may be necessary or appropriate, and (ii) to the extent that anyone other
than Wachovia is the Administrative Agent, entering into a new Account Control
Agreement and Securities Account Control Agreement, and (iii) taking all
additional action that the Administrative Agent may reasonably request to
perfect, protect and more fully evidence the respective interests of the
parties to this Agreement and the Credit Documents in such Collateral.  To 


 


89

















 


the
extent any Collateral is created or comes into existence after the Restatement
Date, the Credit Parties shall take such actions as the Administrative Agent
shall require to obtain a first priority perfected security interest in such
Collateral.


 


Section 5.13                            Interest Rate Protection
Agreements.


 


Each
Credit Party shall perform its duties and obligations under and shall otherwise
maintain any existing Interest Rate Protection Agreements to which it is a
party.


 


Section 5.14                            Control Agreements.


 


The
Borrowers shall maintain the Account Control Agreement and the Securities
Account Control Agreement in full force and effect and shall not amend or modify
the Account Control Agreement or the Securities Account Control Agreement or
waive compliance with any provisions thereunder without the prior written
consent of the Administrative Agent.


 


Section 5.15                            Further Assurances.


 


(a)                                  Public/Private
Designation.  The Credit
Parties will cooperate with the Administrative Agent in connection with the
publication of certain materials and/or information provided by or on behalf of
the Credit Parties to the Administrative Agent and Lenders (collectively, “Information
Materials”) pursuant to this Article V or the other Credit Documents
and will designate Information Materials (i) that are either available to
the public or not material with respect to the Credit Parties and their
Subsidiaries or any of their respective securities for purposes of United
States federal and state securities laws as “Public Information” and (ii) that
are not Public Information as “Private Information”.


 


(b)                                 Additional
Information.  The Credit
Parties shall provide such information regarding the operations, business
affairs and financial condition of the Credit Parties or any of their
Subsidiaries or Affiliates as the Administrative Agent or any Lender may
reasonably request.


 


(c)                                  Visits and
Inspections.  The Credit
Parties shall permit representatives of the Administrative Agent or any Lender,
from time to time upon prior reasonable notice and at such times during normal
business hours, to visit and inspect its Properties; inspect, audit and make
extracts from its books, records and files, including, but not limited to,
management letters prepared by independent accountants; and discuss with its
principal officers, and its independent accountants, its business, assets,
liabilities, financial condition, results of operations and business prospects.  Upon the occurrence and during the
continuance of an Event of Default, the Administrative Agent or any Lender may
do any of the foregoing at any time without advance notice.


 


(d)                                 Intercreditor
Agreement.  The Credit
Parties shall acknowledge and agree to the Intercreditor Agreement to the
extent the Administrative Agent deems that such Intercreditor Agreement is
necessary.


 


Section 5.16                            Performance and Compliance
with Collateral.


 


The Credit Parties shall, at their expense, timely and fully perform and
comply (and shall cause their Consolidated Subsidiaries to timely and fully
perform and comply) with all provisions, covenants 


 


90

















 


and
other promises required to be observed by them under the Collateral and all
other agreements related to such Collateral.


 


Section 5.17                            Delivery of Income and
Required Payments.


 


The
Credit Parties shall deposit, and shall cause the other Credit Parties, each of
their Subsidiaries and all other Persons to deposit, all Income, Required
Payments and other amounts payable to the Borrowers in respect of the
Collateral or payable to any Credit Party or Subsidiary or Affiliate in respect
of any Required Payment into the Collection Account within two (2) Business
Days of such Person’s receipt thereof. 
The Borrowers shall deposit, or cause to be deposited, into the
Collection Account, on or before the date required by the Credit Documents, all
other amounts required by the terms of the Credit Documents.  The Credit Parties shall provide the
Administrative Agent with fully executed copies of all Irrevocable Instructions
required by this Agreement.  The Credit
Parties shall take steps necessary to enforce such Irrevocable Instructions and
shall immediately inform the Administrative Agent of, and rectify any default,
breach, failure or unwillingness to perform thereunder, any dispute or
controversy in connection therewith or any other matter that may, could or will
result in payments not being made as contemplated under the terms of such Irrevocable
Instructions.  The Credit Parties shall
not, and shall not permit any Credit Party or any Subsidiary or Affiliate to,
modify or revoke or permit any modifications or revocations of the Irrevocable
Instructions without the Administrative Agent’s prior written consent in its
discretion.  The Borrowers shall deliver
such other Irrevocable Instructions as the Administrative Agent may require in
its discretion.  All distributions from
the Collection Account and the Securities Account shall be made solely in
accordance with the terms, provisions and conditions of this Agreement, the
Account Control Agreement and the Securities Account Control Agreement.


 


Section 5.18                            Exceptions.


 


The
Borrowers shall promptly correct any and all  Exceptions  set forth on any  Asset Schedule
and Exception Report.


 


Section 5.19                            Distributions in Respect
of Collateral.


 


If
the Credit Parties or any Subsidiary or Affiliate shall receive any rights,
whether in addition to, in substitution of, as a conversion of, or in exchange
for any Collateral, or otherwise in respect thereof, the Credit Parties shall
accept the same as the Administrative Agent’s agent, hold the same in trust for
the Administrative Agent and deliver the same forthwith to the Administrative
Agent (or its designee) in the exact form received, together with duly executed
instruments of transfer, assignments in blank, executed and undated stock
powers in blank and such other documentation as the Administrative Agent shall
reasonably request.  If any sums of money
or property are paid or distributed in respect of the Collateral (other than
the Obligor Reserve Payments) and received by any Credit Party or any
Subsidiary or Affiliate, the Credit Parties shall promptly pay or deliver, or
caused to be paid or delivered, such money or property to the Administrative
Agent and, until such money or property is so paid or delivered to the
Administrative Agent, hold such money or property in trust for the
Administrative Agent, segregated from other funds of the Credit Parties, their
Subsidiaries and Affiliates and other Persons.


 


Section 5.20                            REIT Status.


 


Subject
to Section 6.4 hereof, NorthStar Corp shall remain listed on a nationally
recognized securities exchange in good standing.  NorthStar Corp may change its status as a REIT
provided it remains in compliance with the Financial Covenants in all respects.


 


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Section 5.21                            Issuances.


 


Other
than under the Reindeer Facility and subject to Section 2.5(b), with
respect to each Debt Issuance or Equity Issuance engaged in by Northstar Corp,
Northstar Corp shall (a) not transfer or grant any Lien or encumbrance on
its rights to the Net Cash Proceeds Payments (other than Permitted Liens), (b) execute
and comply and cause all other Persons to execute and comply with Irrevocable
Instructions to require the Net Cash Proceeds Payments to be paid directly to
the Collection Account and not to any Credit Party, any Subsidiary or Affiliate
or any other Person, (c) provide the Administrative Agent with all public
documents related to such Debt Issuance or Equity Issuance, (d) enforce
its rights to the Net Cash Proceeds Payments and (e) immediately notify
the Administrative Agent in writing of any provision of this covenant is not
satisfied or is breached in any respect.


 


Section 5.22                            Remittance of Prepayments.


 


The
Borrowers shall remit or cause to be remitted to the Administrative Agent, with
sufficient detail, via Electronic Transmission, to enable the Administrative
Agent to appropriately identify the Collateral to which any amount remitted
applies, all full or partial principal prepayments (regardless of the source of
repayment) on any Collateral that a Borrower, a Servicer or a PSA Servicer has
received or that have been deposited into the Collection Account no later than
three (3) Business Days following the date such prepayment was received or
deposited.


 


Section 5.23                            Escrow Imbalance.


 


The
Borrowers shall (to the extent it is acting as a servicer) or shall cause the
Servicer to, no later than five (5) Business Days after learning
(from any source) of any material imbalance in any reserve or escrow account
related to any Collateral, fully and completely correct and eliminate such
imbalance, including, without limitation, depositing its own funds into such
account to eliminate any overdraw or deficit, to the extent required by the
applicable Servicing Agreement (in the case of a Servicer).


 


Section 5.24                            Separateness.


 


Notwithstanding
any term contained in this Agreement or the other Credit Documents to the
contrary, each Borrower shall (a) own no assets, and shall not engage in
any business, other than the assets and transactions specifically contemplated
by this Agreement and the Credit Documents; (b) not incur any Indebtedness
or obligation, secured or unsecured, direct or indirect, absolute or contingent
(including guaranteeing any obligation), other than (i) pursuant hereto
and under the agreements and documents evidencing, securing or in any other way
related to the Mortgage Assets and the related Collateral, (ii) customary
representations, warranties, indemnities and other agreements in connection
with the origination, acquisition, servicing, collection, enforcement,
financing, participation, securitization, sale or other disposition of the Mortgage
Assets, and (iii) obligations under zoning and other governmental
regulations, rules, prohibitions and ordinances and proposed restrictions,
covenants, conditions, limitations, easements, rights—of—way and other matters
existing of public record or proposed to be recorded or filed in the future
governing or affecting mortgaged real Property or that may otherwise require
the consent of or joinder by a mortgagee; (c) not make any loans or
advances to any Affiliate other than loans to a Guarantor which are disclosed
in writing to and approved in writing by the Administrative Agent, and shall
not acquire obligations or securities of its Affiliates; (iv) pay its
debts and liabilities (including, as applicable, shared personnel and overhead
expenses) only from its own assets; (d) comply with the provisions of its
Authority Documents; (vi) do all things necessary to observe
organizational formalities and to preserve its existence, and will not amend,
modify or otherwise change its Authority Documents without the consent of the
Administrative Agent; (e) maintain all of its books, records, financial
statements and bank accounts separate from those of its Affiliates (except that
such 


 


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financial
statements may be consolidated to the extent consolidation is required under
the GAAP consistently applied or as a matter of the Requirements of Law) and
file its own tax returns (except to the extent consolidation is required or
permitted under Requirements of Law); (f) be, and at all times will hold
itself out to the public as, a legal entity separate and distinct from any
other entity (including any Affiliate), shall correct any known
misunderstanding regarding its status as a separate entity, shall conduct
business in its own name, and shall not identify itself or any of its
Affiliates as a division of the other; (g) 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; (h) not
engage in or suffer any change of ownership, dissolution, winding up,
liquidation, consolidation or merger in whole or in part; (i) not
commingle its funds or other assets with those of any Affiliate or any other
Person; (j) maintain its accounts separate from those of any Affiliate or
any other Person; (k) shall not hold itself out to be responsible for the
debts or obligations of any other Person; (l) shall not, without the vote
of its Independent Director, (i) file or consent to the filing of any
Insolvency Proceeding with respect to itself, institute any proceedings under
any applicable Insolvency Law or otherwise seek any relief under any
Requirements of Law relating to the relief from debts or the protection of
debtors generally with respect to itself, (ii) seek or consent to the
appointment of a receiver, liquidator, assignee, trustee, sequestrator,
custodian or any similar official for itself or a substantial portion of its
properties, or (iii) make any assignment for the benefit of it’s
creditors; (m) shall have at all times at least one (1) Independent
Director (or such greater number as required by the Administrative Agent or the
Rating Agencies); (n) shall maintain an arm’s length relationship with its
Affiliates; (o) maintain a sufficient number of employees in light of
contemplated business operations; (p) use separate stationary, invoices
and checks; and (q) allocate fairly and reasonably any overhead for shared
office space.


 


Section 5.25                            Preferred Equity Interests.


 


The
Borrowers shall or shall cause each Preferred Equity Grantor to preserve and
maintain its legal and valid existence, rights, franchises, privileges and good
standing in the jurisdiction of its formation and will qualify and remain
qualified in good standing in each other jurisdiction where, due to the nature
of its business or Property, such qualification is necessary.  The Borrowers shall provide evidence to the
Administrative Agent, upon request, of the Preferred Equity Grantor’s
compliance with the requirements of this subsection.


 


Section 5.26                            Registration of Securities.


 


In
the case of any Pledged Mortgage Asset not physically delivered to the
Administrative Agent as agent for the Lenders (or the Custodian on its behalf)
unless otherwise consented to by the Administrative Agent, the Borrowers shall
maintain, or cause to be maintained, each of the Securities (as defined in the
UCC) with either DTC or with the National Book Entry System of the Federal
Reserve, DTC or any similar firm or agency, as applicable, in the name of the
Administrative Agent as agent for the Lenders.


 


Section 5.27                            Termination of Securities
Account.


 


Upon
the Borrowers’ receipt of notice from any securities intermediary (as defined
in the UCC) of its intent to terminate any securities account (as defined in
the UCC) of the Borrowers held by such securities intermediary and relating to
a Pledged Mortgage Asset or collateral for a Pledged Mortgage Asset, prior to
the termination of such securities account the collateral in such account (a) shall
be transferred to a new securities account, upon the request of the
Administrative Agent, which shall be subject to an executed control agreement
as provided in Section 5.12 of this Agreement or (b) transferred to
an account held by the Administrative Agent as agent for the Lenders in which
such collateral will be 


 


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held
until a new securities account is established with an executed control
agreement acceptable to the Administrative Agent in its discretion.


 


Section 5.28                            Independent Director.


 


The
Borrowers and the Guarantors shall provide the Administrative Agent at least
ten (10) Business Days prior written notice of its removal or replacement
of any Independent Director appointed with respect to any Borrower.  The Borrowers and the Guarantors shall
provide the Administrative Agent a copy of the executed agreement with respect
to the appointment of any such Independent Director.  The identity and contact information for such
Independent Director is set forth on Schedule 5.28 attached hereto, as such
information may be updated from time to time by written notice to the
Administrative Agent.


 


Section 5.29                            Main Treasury Bank.


 


No
later than ninety (90) days following the Restatement Date, each Guarantor
shall establish a deposit account with Wells Fargo Bank, National Association
(each such account, a “Main Treasury Account”, which account each
Guarantor shall use as its main treasury bank and in which each Guarantor shall
maintain on deposit more cash than is maintained in any other bank at which
such Guarantor maintains an account.


 


Section 5.30                            Independence of Covenants.


 


All
covenants hereunder shall be given independent effect so that if a particular
action or condition is not permitted by any of such covenants, the fact that it
would be permitted by an exception to, or be otherwise within the limitations
of, another covenant shall not avoid the occurrence of a Default or an Event of
Default if such action is taken or condition exists.


 


ARTICLE VI


 


NEGATIVE COVENANTS


 


Each of the Credit Parties hereby covenants and agrees that on the
Restatement Date, and thereafter (a) for so long as this Agreement is in
effect, (b) until the Commitments have terminated, (c) until no Note
remains outstanding and unpaid and the Obligations and all other amounts owing
to the Administrative Agent or any Lender hereunder are paid in full, that:


 


Section 6.1                                   Indebtedness.


 


The
Borrowers shall not create, incur, assume or suffer to exist any Indebtedness
(including, but not limited to, any credit or repurchase facility), Guarantee
Obligation or Contractual Obligation of the Borrowers, except Indebtedness,
Guarantee Obligations and Contractual Obligations of the Borrowers permitted
under this Agreement.


 


Section 6.2                                   Liens.


 


The
Credit Parties and the Subsidiaries and Affiliates shall not sell, pledge,
assign or transfer to any other Person, or grant, create, incur, assume, suffer
or permit to exist any Lien on all or any portion of the Collateral or the
Required Payments, other than Permitted Liens, whether now existing or
hereafter transferred hereunder, or any interest therein, and the Credit
Parties and the Subsidiaries and Affiliates 


 


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shall
not sell, pledge, assign or suffer to exist any Lien, or any circumstance
which, if adversely determined, would be reasonably likely to give rise to a
Lien, on its interest, if any, hereunder or under the other Credit
Documents.  Immediately upon notice to
any Credit Party of a Lien or any circumstance which, if adversely determined
would be reasonably likely to give rise to a Lien (other than in favor of the
Administrative Agent or created by or through the Administrative Agent), on all
or any portion of the Collateral or the Required Payments, the Borrowers shall
notify the Administrative Agent and the Borrowers shall further defend the
Collateral and the Required Payments against, and will take such other action
as is necessary to remove, any Lien or claim on or to the Collateral or the
Required Payments (other than any Permitted Liens created under this Agreement
and the Credit Documents), and the Borrowers shall defend the right, title and
interest of the Credit Parties and their Subsidiaries and Affiliates in and to
any of the Collateral and the Required Payments against the claims and demands
of all Persons whomsoever. 
Notwithstanding the foregoing, if a Credit Party or any Subsidiary or
Affiliate shall grant a Lien on any of the Collateral or Required Payments in
violation of this Section, then it shall be deemed to have simultaneously
granted an equal and ratable Lien on any such Collateral or Required Payments
in favor of the Administrative Agent for the ratable benefit of the Lenders to
the extent such Lien has not already been granted to the Administrative Agent.


 


Section 6.3                                   Nature of Business.


 


No
Borrower will alter the character of its business in any material respect from
that conducted as of the Restatement Date. 
The Borrowers shall not engage in any activity other than activities
specifically permitted by this Agreement, including, but not limited to,
investment in mortgage loans, mezzanine loans, participations, preferred equity
and other real estate related assets and the purchasing, financing and holding
of commercial mortgage-backed securities and activities incident thereto.


 


Section 6.4                                   Consolidation, Merger,
Sale or Purchase of Assets, etc.


 


(a)                                  Neither the
Borrowers nor the Guarantors shall 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) or sell all or substantially
all of its assets; provided, however, that the Borrowers or the
Guarantors may merge or consolidate with (i) any wholly owned Subsidiary of
such Person, or (ii) any other Person if (A) a Borrower or a
Guarantor is the surviving corporation or (B) if the surviving entity is
not in the Administrative Agent’s reasonable opinion materially weaker in its
financial condition (in the aggregate) than the prior entities pre—merger or
pre—consolidation; provided, that, (x) if after giving
effect thereto, no Event of Default would exist hereunder, and (y) the new
entity (if any) assumes the obligations, liabilities and Indebtedness under the
Credit Documents, if applicable, and the Interest Rate Protection Agreements.


 


(b)                                 Neither the
Borrowers nor the Guarantors shall permit a Person or two or more Persons
acting in concert to acquire a “beneficial ownership”, directly or indirectly,
of, or acquire by contract or otherwise, or shall have entered into a contract
or arrangement that upon consummation, will result in its or their acquisition
of or control over the Voting Interests of a Borrower or a Guarantor (or other
securities convertible into such Voting Interests) representing more
than 50% of the combined voting power of all Voting Interests of any
Borrower or any Guarantor unless if after giving effect thereto, no
Event of Default would exist hereunder and the purchaser is not in the
Administrative Agent’s reasonable opinion materially weaker in its financial
condition (in the aggregate) than (i) the prior owner or (ii) such
Borrower or Guarantor, as applicable.


 


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Section 6.5                                   Warrant Agreements.


 


Northstar Corp shall
not redeem or cancel any shares of  capital stock or take any
other action with respect to its capital stock if such act would cause
Wachovia, upon the exercise of the Warrant Agreements, to own in excess of five
percent (5.00%) of the capital stock of Northstar Corp.


 


Section 6.6                                   Transactions with
Affiliates.


 


The Credit Parties will not, nor will they permit any Subsidiary to,
enter into any transaction or series of transactions, whether or not in the
ordinary course of business, with any officer, director, shareholder or
Affiliate other than on terms and conditions substantially as favorable as
would be obtainable in a comparable arm’s-length transaction with a Person that
is not an officer, director, shareholder or Affiliate.


 


Section 6.7                                   Ownership of Subsidiaries;
Restrictions.


 


The
Borrowers shall not create, form or permit to exist any Subsidiary prior to the
later of (i) the Maturity Date (as it may be extended in accordance with
this Agreement) and (ii) the indefeasible payment in full of the
Obligations.


 


Section 6.8                                   Corporate Changes;
Material Contracts.


 


No Credit Party will (a) change its fiscal year, (b) amend,
modify or change its Authority Documents in any respect that would impact,
impair or affect the Collateral or any Required Payment or is otherwise adverse
to the interests of the Lenders without the prior written consent of the
Administrative Agent; provided that no Credit Party shall (i) 
alter its legal existence or (iii) change its registered legal name,
without providing thirty (30) days prior written notice to the
Administrative Agent and without filing (or confirming that the Administrative
Agent has filed) such financing statements and amendments to any previously
filed financing statements as the Administrative Agent may require, (c) amend,
modify, cancel or terminate or fail to renew or extend or permit the amendment,
modification, cancellation or termination of any of its material contracts in
any respect materially adverse to the interests of the Lenders without the
prior written consent of the Administrative Agent, (d) change its state of
incorporation, organization or formation without the consent of the
Administrative Agent or have more than one state of incorporation, organization
or formation or (e) change its accounting method (except in accordance
with GAAP) in any manner adverse to the interests of the Lenders without the
prior written consent of the Required Lenders.


 


Section 6.9                                   [Reserved].


 


Section 6.10                            Restricted Payments.


 


Except
as otherwise required or permitted by the Credit Documents, no Credit Party
shall declare or make any payment on account of, or set apart assets for, a
sinking or other analogous fund for the purchase, redemption, defeasance,
retirement or other acquisition of any Equity Interest of any Credit Party
whether now or hereafter outstanding, or make any other distribution in respect
thereof, either directly or indirectly, whether in cash or Property or in
obligations of any Credit Party, except that a Credit Party may declare and pay
dividends in accordance with its respective Authority Documents and purchase or
redeem Equity Interests of any Credit Party, and without restriction as to
amount, so long as, in the case of the Credit Party, (a) no Default or
Event of Default shall have occurred, (b) no mandatory prepayment
obligation is due and payable, (c) no mandatory prepayment obligation
required pursuant to Section 2.5(b) with respect to any Revolving
Loan is due but not yet payable, and (d) the distribution of 


 


96

















 


such
funds will not violate any Financial Covenant. 
Notwithstanding the preceding sentence and irrespective of the
occurrence of the events described in clauses (a), (b) or (c) of
the immediately preceding sentence, the Guarantors may at all times pay
dividends either (i) as required by Requirement of Law to maintain its
REIT status and/or (ii) to its preferred equity holders.


 


Section 6.11                            [Reserved].


 


Section 6.12                            No Further Negative
Pledges.


 


None
of the Borrowers shall grant, allow or enter into any agreement or arrangement
with any Person that prohibits or restricts, or purports to prohibit or
restrict, the granting of any Lien or other encumbrance on any of the assets or
Properties of the Borrowers; provided, however, that the
foregoing shall not apply to (i) the negative pledge contained in Section 6.18,
(ii) Indebtedness identified on Schedule 6.1(b) or (iii) any
other negative pledge or grant of any Lien or other encumbrance approved by the
Administrative Agent in its discretion.


 


Section 6.13                            Collateral Not to be
Evidenced by Instruments.


 


No
Credit Party shall take any action to cause all or any portion of the
Collateral that is not, as of the applicable Borrowing Date, evidenced by an
Instrument  to be so evidenced except, with the
Administrative Agent’s consent, in connection with the enforcement or
collection of such Collateral.


 


Section 6.14                            Deposits.


 


The
Credit Parties will not deposit or otherwise credit, or cause or permit to be
so deposited or credited, to the Collection Account or Securities Account cash
or cash proceeds other than (i) in the case of the Collection Account,
Income in respect  of  Collateral,
Cash Collateral and other payments required to be deposited therein under the
Credit Documents, and (ii) in the case of the Securities Account, the CMBS
Securities that are Mortgage Assets and other Collateral related thereto
(except those CMBS Securities that are certificated securities within the
meaning of Article 8 of the UCC).


 


Section 6.15                            Servicing Agreements.


 


The
Credit Parties will not materially amend, modify, waive or terminate any
provision of any Servicing Agreement or Pooling and Servicing Agreement without
the prior written consent of the Administrative Agent.  Notwithstanding the foregoing, but subject to
the Administrative Agent’s rights under Article IX, the Borrowers shall
have the right to terminate any of the foregoing upon the occurrence of a
material default (beyond any applicable notice and cure period) of the other
party thereto.


 


Section 6.16                            Extension or Amendment of
Collateral.


 


Except
as provided in Section 9.7, the Borrowers will not extend, amend, waive or
otherwise modify, or permit any Servicer or PSA Servicer (except as provided in
a Pooling and Servicing Agreement) to extend, amend, waive or otherwise modify
the material terms of any Collateral or the Mortgage Loan Documents related
thereto or to exercise the material rights of a holder of said Collateral,
provided that the foregoing shall not prohibit the Borrowers, a Servicer or a
PSA Servicer from permitting, prior to a default thereunder, any Obligor to
exercise an extension option contained in any Mortgage Loan Documents.  Unless otherwise agreed to by the
Administrative Agent in its discretion, the Borrowers, the Servicers and the
PSA Servicers (except as provided in a Pooling and Servicing Agreement) shall
have no right to waive, amend, modify or alter the material terms of any
Collateral or 


 


97

















 


the
related Mortgage Loan Documents thereto or otherwise exercise any material
right of the holder of any Collateral.


 


Section 6.17                            Additional Covenants.


 


In the event that (i) any
Credit Party or any Consolidated Subsidiary of a Credit Party shall incur any
additional secured Indebtedness on or after the Restatement Date, or amend the
documentation for any secured Indebtedness of a Credit Party or any
Consolidated Subsidiary of a Credit Party outstanding on or after the
Restatement Date, and (ii) such secured Indebtedness either requires or
incorporates additional covenants, or amends any covenants, of any Credit
Party or any Consolidated Subsidiary of a Credit Party that (A) are
the same as or similar to the Financial Covenants  or (B) require repayment of any such
secured Indebtedness from any Equity Issuance, any Debt Issuance, any sale of
any non-cash consideration received in connection with an Equity Issuance or
Debt Issuance or any disposition of collateral not pledged in connection with
such other secured Indebtedness facility by any Credit Party or any
Consolidated Subsidiary of a Credit Party in such a way as to make any covenant
or repayment referred to in clauses (A) or (B) above (the “Additional
Covenants”) more restrictive than provided for in the Credit Documents,
the Credit Parties shall promptly (but in no event later than ten (10) Business
Days thereafter) notify the Administrative Agent and each Lender in
writing of such occurrence.  If
the Administrative Agent so elects within twenty (20) Business Days
following receipt of such notice, then such Additional Covenants shall
automatically be incorporated by reference into the Credit Documents
without the need for further action by any party whatsoever.  Thereupon, the Administrative Agent and
each Lender shall have a separate and independent right to enforce such
Additional Covenants.  The Administrative
Agent may also elect to amend the Credit Documents to incorporate such
Additional Covenants.  The Credit Parties
agree to cooperate in executing such amendments to the Credit Documents as the
Administrative Agent may require in its reasonable discretion.  For the purposes of this Section, (x) the
term Credit Parties shall include NRFC SUB-REIT Corp. and (y) the term
Consolidated Subsidiaries shall not include: (1) Northstar Corp’s Wakefield venture and
entities directly related to such venture, (2) NorthStar Real Estate
Income Trust, Inc. and its Subsidiaries, NorthStar Income Opportunity REIT
I, Inc. and its Subsidiaries and any other public entities that may be
part of Northstar Corp’s non-listed REIT initiative, (3) NorthStar Real
Estate Securities Opportunity Master Fund, L.P. and its Subsidiaries, and (4) any
other entities that may in the future be managed by Northstar Corp or its
Affiliates that are not majority owned, directly or indirectly, by Northstar
Corp.


 


Section 6.18                            No Future Liens.


 


No
Credit Party shall grant or permit, or suffer to be granted or permitted, any
Lien on, or any encumbrances upon any Collateral and any Required Payment, in
favor of any Person, other than Liens in favor of the Administrative Agent and
the Lenders.


 


Section 6.19                            Senior and Pari Passu Interests.


 


Unless
agreed to by the Administrative Agent in its reasonable discretion, no Credit
Party shall acquire or maintain any right or interest in any Mortgage Asset
(or, directly or indirectly, the Underlying Mortgaged Property with respect
thereto) that is senior to or pari passu with
the rights and interests of the Administrative Agent therein under this
Agreement and the Credit Documents unless such interest is also part of the
Collateral; provided that the foregoing negative covenant shall not
apply to CMBS Securities; provided, further, that the
Administrative Agent consents to any senior or pari passu interest held by any
Credit Party or Affiliate thereof as of the Restatement Date.


 


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Section 6.20                            Portfolio Assets.


 


To
the extent the Administrative Agent acquires a pledge of multiple Mortgage
Assets as a part of a portfolio or package, the Borrowers shall not repay or
obtain the release of any Lien on less than all such Collateral without
repaying all Loans related to all such Collateral included in the portfolio or
package, unless the Administrative Agent otherwise consents in its discretion.


 


Section 6.21                            Inconsistent Agreements.


 


The
Credit Parties shall not directly or indirectly, enter into any agreement
containing any provision that would be violated or breached by any transaction,
Loan or pledge of Collateral under the Credit Documents or by the performance
by any Credit Party of its duties, covenants or obligations under any Credit
Document.


 


Section 6.22                            Preferred Equity Interests.


 


The
Borrowers shall not permit any Equity Interest that is the subject of a
Preferred Equity Interest to consist of an interest in an entity other than a
partnership or limited liability company and, with respect to such limited
partnership and limited liability company interests, shall not permit any such
interest to:  (a) be dealt in or
traded on a securities exchange or in a securities market or (b) be held
in a Securities Account.  The Borrowers
shall execute and deliver, or cause to be executed or delivered, to the
Administrative Agent as agent for the Lenders (or the Custodian on its behalf)
such agreements, documents and instruments as the Administrative Agent  may reasonably require to perfect its security interest in
any such Equity Interest.


 


Section 6.23                            ERISA.


 


Each of the Credit Parties will not without the prior approval of the
Administrative Agent, establish or maintain any Plan, nor take any action that
would (i) cause it to fail to qualify as an Operating Company or (ii) cause
it to fail to otherwise meet an exception under the Plan Asset Regulations
which would prevent the assets of such Person from being subject to Title I of
ERISA or Section 4975 of the Code.


 


ARTICLE VII


 


EVENTS OF DEFAULT


 


Section 7.1                                   Events of Default.


 


An Event of Default shall exist upon the occurrence of any of the
following specified events (each an “Event of Default”):


 


(a)                                  Payment.  (i) The Borrowers shall fail to pay any
principal or interest on any Loan or Note when due (whether at maturity, by
reason of mandatory or optional prepayment, by reason of acceleration or
otherwise) in accordance with the terms hereof or thereof; or (ii) the
Borrowers shall fail to pay any fee or other amount payable hereunder or under
the Credit Documents when due (whether at maturity, by reason of mandatory or
optional prepayment, by reason of acceleration or otherwise) in accordance with
the terms hereof and such failure shall continue unremedied for two (2) Business
Days after written notice from the Administrative Agent; or (iii) or any
Guarantor shall fail to pay on the Guaranty in respect of any of the 


 


99

















 


foregoing or in respect of any other Obligations under the Credit Documents
(after giving effect to the grace period in clause (ii) above; or (iv) any
other Credit Party shall fail to pay any amounts owed by it under the Credit
Documents to which it is a party (after giving effect to the grace period in
clause (ii) above); or


 


(b)                                 Misrepresentation.  Any representation or warranty made or deemed
made herein, in the Security Documents or in any of the other Credit Documents
or which is contained in any certificate, document or financial or other
statement furnished at any time under or in connection with this Agreement or
the Credit Documents (in each case other than the eligibility criteria
contained in Schedule 1.1(c) to this Agreement unless any Borrower
shall have affirmed or confirmed any such eligibility criteria with actual
knowledge that it was not satisfied in any material respect) shall prove to
have been incorrect, false or misleading on or as of the date made or deemed
made and continues to be unremedied for a period of twenty (20) Business
Days after the earlier to occur of (i) the date on which written notice of
such incorrectness requiring the same to be remedied shall have been given to
the Credit Parties by the Administrative Agent, and (ii) the date on which
the Credit Parties become aware thereof; or


 


(c)                                  Covenant
Default.  (i) Any Credit Party
shall fail to perform, comply with or observe any term, covenant or agreement
applicable to it contained in Sections 5.9 or 6.4; or (ii) any Credit
Party shall fail to comply with any other covenant contained in this Agreement
or the other Credit Documents or any other agreement, document or instrument
among any Credit Party, the Administrative Agent and the Lenders or executed by
any Credit Party in favor of the Administrative Agent or the Lenders (other
than as described in Sections 7.1(a) or 7.1(c)(i) above), and
such breach or failure to comply is not cured within twenty (20) days
after the earlier to occur of (i) the date on which written notice of such
failure requiring the same to be remedied shall have been given to the Credit
Parties by the Administrative Agent, and (ii) the date on which the Credit
Parties become aware thereof (provided, however, in the case of a
failure which is capable of cure but cannot reasonably be cured within such
twenty (20) day period (other than the payment of money), and provided the
Credit Parties shall have timely commenced to cure such failure within such
twenty (20) day period (with evidence of same delivered to the
Administrative Agent) and thereafter diligently and expeditiously proceeds to
cure the same, such twenty (20) day period shall be extended for an
additional twenty (20) day period); or


 


(d)                                 Indebtedness Cross-Default. (A) No
Borrower, the Guarantor or Pledgor shall have defaulted in any payment due with
respect to any material Indebtedness in excess of (1) $5,000,000 in the
case of a Guarantor or a Pledgor and (2) $1,000,000 in the case of any
Borrower (in each case including, without limitation, recourse debt), any
Guarantee Obligations or any material Contractual Obligation in excess of
$5,000,000 in the case of a Guarantor or a Pledgor, and $1,000,000 in the case
of any Borrower, to which a Borrower, Guarantor or Pledgor as applicable, is a
party, or a default or an event or condition shall have occurred that would
permit acceleration of any of the foregoing whether or not such event or
condition has been waived, (B) no Borrower, Guarantor or Pledgor shall be
in default of any monetary obligation with respect to any Credit Party—Related
Obligation or (C) no Borrower, Guarantor or Pledgor shall be in default
with respect to any obligation under the Interest Rate Protection Agreements;
or


 


(e)                                  Key Manager.  Three or more of David Hamamoto, Daniel
Gilbert, Andrew Richardson or Al Tylis resigns, are removed or otherwise no
longer serve in their respective offices as an officer or director of Northstar
Corp or an Affiliate; or


 


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(f)                                    Bankruptcy Default.  (i) A Credit Party shall commence any
case, proceeding or other action (A) under any existing or future
Requirements of Law of any jurisdiction, domestic or foreign, relating to
bankruptcy, insolvency, reorganization or relief of debtors, seeking to have an
order for relief entered with respect to it, or seeking to adjudicate it a bankrupt
or insolvent, or seeking reorganization, arrangement, adjustment, winding-up,
liquidation, dissolution, composition or other relief with respect to it or its
debts, or (B) seeking appointment of a receiver, trustee, custodian,
conservator or other similar official for it or for all or any substantial part
of its assets, or a Credit Party shall make a general assignment for the
benefit of its creditors; or (ii) there shall be commenced against a
Credit Party any case, proceeding or other action of a nature referred to in
clause (i) above which (A) results in the entry of an order for
relief or any such adjudication or appointment or (B) remains undismissed,
undischarged or unbonded for a period of sixty (60) days; or  (iii) there shall be commenced against a Credit Party
any case, proceeding or other action seeking issuance of a warrant of
attachment, execution, distraint or similar process against all or any
substantial part of their assets which results in the entry of an order for any
such relief which shall not have been vacated, discharged, or stayed or bonded
pending appeal within sixty (60) days from the entry thereof; or (iv) a
Credit Party shall take any action in furtherance of, or indicating its consent
to, approval of, or acquiescence in, any of the acts set forth in
clause (i), (ii), or (iii) above; or  (v) a
Credit Party shall generally not, or shall be unable to, or shall admit in
writing their inability to, pay its debts as they become due; or


 


(g)                                 Judgment Default.  One or more final non-appealable judgments or
decrees shall be entered against a Credit Party involving in the aggregate a
liability (to the extent not covered by insurance) of $1,000,000 or more with
respect to any Borrower or $5,000,000 or more with respect to any Guarantor or
Pledgor and all such judgments or decrees shall not have been paid and
satisfied, vacated, discharged, stayed or bonded pending appeal within thirty
(30) Business Days from the entry thereof; or


 


(h)                                 ERISA Default.  A Credit Party or an ERISA Affiliate shall
engage in a non—exempt prohibited transaction (as defined in Section 406
of ERISA or Section 4975 of the Code); or


 


(i)                                     Bi-Annual Principal
Reduction.  The
Borrowers shall fail to comply with any Bi-Annual Principal Reduction on or
before the dates described in the definition of Bi-Annual Principal Reduction
and such failure is not cured within three (3) Business Days; or


 


(j)                                     Invalidity of Credit
Documents.  (i) Any
Credit Document, or any Lien or security interest granted thereunder, shall
(except in accordance with its terms), in whole or in part, terminate, cease to
be effective, be declared null and void, cease to be in full force and effect
or cease to be the legally valid, binding and/or enforceable obligation of any
Credit Party, as applicable, (ii) any Credit Party or any other Person
shall, directly or indirectly, contest in any manner the effectiveness,
validity, binding nature or enforceability of any Credit Document or any Lien
or security interest thereunder or deny or disaffirm such Person’s obligations
under any Credit Document, (iii) the Liens contemplated under the Credit
Documents shall cease or fail to be first priority perfected Liens on any
Collateral in favor of the Administrative Agent or shall be Liens in favor of
any Person other than the Administrative Agent, (iv) any Credit Party
shall grant, or permit or suffer to exist, any Lien on any Collateral except
Permitted Liens, or (v) any Credit Party or any Subsidiary or Affiliate of
the foregoing shall grant, or permit or suffer to exist, any Lien on any
Required Payment; or


 


(k)                                  [Reserved]


 


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(l)                                     Equity Ownership.  The Pledgor shall cease to own directly 100%
of the issued and outstanding Equity Interests of each of the Borrowers; or


 


(m)                               40 Act.  Any Credit Party shall become required to
register as an “investment company” within the meaning of the 40 Act or
the arrangements contemplated by the Credit Documents shall require
registration as an “investment company” within the meaning of the 40 Act;
or


 


(n)                                 Material Adverse Effect.  There shall exist any event or occurrence set
forth in clause (a), (b), (c) or (d) in the definition of Material
Adverse Effect; or


 


(o)                                 [Reserved]


 


(p)                                 [Reserved]


 


(q)                                 Irrevocable Instructions.  Any Credit Party’s failure to deliver any
Irrevocable Instruction required under this Agreement or any Person’s attempt
to disavow, revoke or act contrary to, the failure of any Person to abide by or
perform, or any Credit Party’s failure to enforce, the terms of any Irrevocable
Instruction; or


 


(r)                                    Solvency.  Any Credit Party is not Solvent or shall
admit its inability to, or its intentions not to, perform its obligations,
covenants, duties or agreements under any Credit Document, any Obligation or
any Credit Party-Related Document; or


 


(s)                                  [Reserved].


 


(t)                                    Commitment.  The aggregate principal amount of all
Revolving Loans outstanding on any day exceeds the Revolving Commitment and the
same continues unremedied for two (2) Business Days after notice from the
Administrative Agent; provided, however, during the period of
time that such event remains unremedied, no additional Revolving Loans will be
made under this Agreement; or


 


(u)                                 Servicer Default.    A Servicer Default occurs and is
continuing; or


 


(v)                                 Income.  Any Credit Party’s, any Servicer’s or any PSA
Servicer’s failure to deposit to the Collection Account all Income and other
Cash Collateral as required by this Agreement or the failure of the Borrowers
to deposit or credit to the Securities Account any uncertificated CMBS Security
and related Collateral required to be deposited or credited to such account; or


 


(w)                               Consent.  Any Credit Party engages in any conduct or
action where the Administrative Agent’s and/or any Lender’s prior written
consent is required by the terms of this Agreement or the other Credit
Documents and any Credit Party fails to obtain such consent; or


 


(x)                                   [Reserved].


 


(y)                                 Other Defaults.  Any event or occurrence under this Agreement
or any of the other Credit Documents that, by the express terms of this
Agreement or the other Credit Documents, is deemed to constitute an Event of
Default after giving effect to the applicable notice and/or cure periods.


 


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In
making a determination as to whether an Event of Default has occurred, the
Administrative Agent and the Lenders shall be entitled to rely on reports
published or broadcast by media sources believed by the Administrative Agent
and/or any Lender to be generally reliable and on information provided to it by
any other sources believed by it to be generally reliable, provided that the
Administrative Agent and/or the Lender reasonably and in good faith believes
such information to be accurate and has taken such steps as may be reasonable
in the circumstances to attempt to verify such information.  Notwithstanding anything contained in the
Credit Documents to the contrary, unless waived by the Administrative Agent in
its discretion, neither the Credit Parties nor any other Person shall be
permitted to cure an Event of Default after the acceleration of any of the
Obligations.


 


Section 7.2                                   Acceleration; Remedies.


 


Upon the occurrence and during the continuance of an Event of Default,
then, and in any such event, (a) if such event is a Bankruptcy Event of
Default, automatically the Commitments shall immediately terminate and the
Loans (with accrued interest thereon), and all Obligations and other amounts
under the Credit Documents shall immediately become due and payable, and (b) if
such event is any other Event of Default, any or all of the following actions
may be taken:  (i) with the written
consent of the Required Lenders, the Administrative Agent may, or upon the
written request of the Required Lenders, the Administrative Agent shall,
declare the Commitments to be terminated forthwith, whereupon the Commitments
shall immediately terminate; (ii) the Administrative Agent may, or upon
the written request of the Required Lenders, the Administrative Agent shall,
declare the Loans (with accrued interest thereon) and all Obligations and other
amounts owing under this the Credit Documents to be due and payable forthwith,
whereupon the same shall immediately become due and payable; and/or (iii) with
the written consent of the Required Lenders, the Administrative Agent may, or
upon the written request of the Required Lenders, the Administrative Agent
shall, exercise such other rights and remedies as provided under the Credit
Documents and under Requirements of Law.


 


ARTICLE VIII


 


THE ADMINISTRATIVE AGENT


 


Section 8.1                                   Appointment and Authority.


 


Each of the Lenders hereby irrevocably appoints Wachovia to act on its
behalf as the Administrative Agent hereunder and under the other Credit
Documents and authorizes the Administrative Agent to take such actions on its
behalf and to exercise such powers as are delegated to the Administrative Agent
by the terms hereof or thereof, together with such actions and powers as are
reasonably incidental thereto.  The
provisions of this Article are solely for the benefit of the Administrative
Agent and the Lenders, and neither the Borrowers nor any other Credit Party
shall have rights as a third party beneficiary of any of such provisions.


 


Section 8.2                                   Nature of Duties.


 


Anything
herein to the contrary notwithstanding, none of the bookrunners, Arrangers or
other agents listed on the cover page hereof shall have any powers, duties
or responsibilities under this Agreement or any of the other Credit Documents,
except in its capacity, as applicable, as the Administrative Agent, or a Lender
hereunder.  Without limiting the
foregoing, none of the Lenders or other Persons so identified shall have or be
deemed to have any fiduciary relationship with any Lender.  Each Lender acknowledges that it has not
relied, and will not rely, on any of the other Lenders or other Persons so
identified in deciding to enter into this Agreement or in taking or not taking
action hereunder.


 


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The
Administrative Agent may perform any and all of its duties and exercise its
rights and powers hereunder or under any other Credit Document by or through
any one or more sub-agents appointed by the Administrative Agent.  The Administrative Agent and any such
sub-agent may perform any and all of its duties and exercise its rights and
powers by or through their respective Related Parties.  The exculpatory provisions of this Article shall
apply to any such sub-agent and to the Related Parties of the Administrative
Agent and any such sub-agent, and shall apply to their respective activities in
connection with the syndication of the credit facilities provided for herein as
well as activities as Administrative Agent.


 


Section 8.3                                   Exculpatory Provisions.


 


The
Administrative Agent shall not have any duties or obligations except those expressly
set forth herein and in the other Credit Documents.  Without limiting the generality of the
foregoing, the Administrative Agent:


 


(a)                                  shall not be subject to any
fiduciary or other implied duties, regardless of whether a Default has occurred
and is continuing;


 


(b)                                 shall not have any duty to
take any discretionary action or exercise any discretionary powers, except
discretionary rights and powers expressly contemplated hereby or by the other
Credit Documents that the Administrative Agent is required to exercise as
directed in writing by the Required Lenders (or such other number or percentage
of the Lenders as shall be expressly provided for herein or in the other Credit
Documents), provided that the Administrative Agent shall not be required
to take any action that, in its opinion or the opinion of its counsel, may
expose the Administrative Agent to liability or that is contrary to any Credit
Document or Requirements of Law; and


 


(c)                                  shall not, except as
expressly set forth herein and in the other Credit Documents, have any duty to
disclose, and shall not be liable for the failure to disclose, any information
relating to the Borrowers or any of their Affiliates that is communicated to or
obtained by the Person serving as the Administrative Agent or any of its
Affiliates in any capacity.


 


The
Administrative Agent shall not be liable for any action taken or not taken by
it (i) with the consent or at the request of the Required Lenders (or such
other number or percentage of the Lenders as shall be necessary, or as the
Administrative Agent shall believe in good faith shall be necessary, under the
circumstances as provided in Sections 10.1 and 7.2) or (ii) in the
absence of its own gross negligence or willful misconduct.


 


The
Administrative Agent shall not be responsible for or have any duty to ascertain
or inquire into (i) any statement, warranty or representation made in or
in connection with this Agreement or any other Credit Document, (ii) the
contents of any certificate, report or other document delivered hereunder or
thereunder or in connection herewith or therewith, (iii) the performance
or observance of any of the covenants, agreements or other terms or conditions
set forth herein or therein or the occurrence of any Default or Event of
Default, (iv) the validity, enforceability, effectiveness or genuineness
of this Agreement, any other Credit Document or any other agreement, instrument
or document or (v) the satisfaction of any condition set forth in Article IV
or elsewhere herein, other than to confirm receipt of items expressly required
to be delivered to the Administrative Agent.


 


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Section 8.4                                   Reliance by Administrative
Agent.


 


The
Administrative Agent shall be entitled to rely upon, and shall not incur any
liability for relying upon, any notice, request, certificate, consent,
statement, instrument, document or other writing (including any electronic
message, internet or intranet website posting or other distribution) believed
by it to be genuine and to have been signed, sent or otherwise authenticated by
the proper Person.  The Administrative
Agent also may rely upon any statement made to it orally or by telephone and
believed by it to have been made by the proper Person, and shall not incur any
liability for relying thereon.  In
determining compliance with any condition hereunder to the making of a Loan,
that by its terms must be fulfilled to the satisfaction of a Lender, the
Administrative Agent may presume that such condition is satisfactory to such
Lender unless the Administrative Agent shall have received notice to the
contrary from such Lender prior to the making of such Loan.  The Administrative Agent may consult with
legal counsel (who may be counsel for the Borrowers), independent accountants
and other experts selected by it, and shall not be liable for any action taken
or not taken by it in accordance with the advice of any such counsel,
accountants or experts.


 


Section 8.5                                   Notice of Default.


 


The Administrative Agent shall not be deemed to have knowledge or
notice of the occurrence of any Default or Event of Default hereunder unless
the Administrative Agent has received written notice from a Lender or one of
the Borrowers referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a “notice of default”.  In the event that the Administrative Agent
receives such a notice, the Administrative Agent shall give prompt notice
thereof to the Lenders.  The
Administrative Agent shall take such action with respect to such Default or
Event of Default as shall be reasonably directed by the Required Lenders; provided,
however, that unless and until the Administrative Agent shall have
received such directions, the Administrative Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with
respect to such Default or Event of Default as it shall deem advisable in the
best interests of the Lenders except to the extent that this Agreement
expressly requires that such action be taken, or not taken, only with the
consent or upon the authorization of the Required Lenders, or all of the
Lenders, as the case may be.


 


Section 8.6                                   Non-Reliance on
Administrative Agent and Other Lenders.


 


Each Lender expressly acknowledges that neither the Administrative
Agent nor any of its officers, directors, employees, agents, attorneys-in-fact
or affiliates has made any representation or warranty to it and that no act by
the Administrative Agent hereinafter taken, including any review of the affairs
of any Credit Party, shall be deemed to constitute any representation or
warranty by the Administrative Agent to any Lender.  Each Lender acknowledges that it has,
independently and without reliance upon the Administrative Agent or any other
Lender or any of their Related Parties and based on such documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement. 
Each Lender also acknowledges that it will, independently and without
reliance upon the Administrative Agent or any other Lender or any of their
Related Parties and based on such documents and information as it shall from
time to time deem appropriate, continue to make its own decisions in taking or
not taking action under or based upon this Agreement, any other Credit Document
or any related agreement or any document furnished hereunder or thereunder.


 


Section 8.7                                   Indemnification.


 


The Lenders agree to indemnify the Administrative Agent in its capacity
hereunder and its Affiliates and its respective officers, directors, agents and
employees (to the extent not reimbursed by the Borrowers and without limiting
the obligation of the Borrowers to do so), pro rata based on the portion of 


 


105

















 


the Obligations owed to each Lender on the date on which
indemnification is sought under this Section, from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind whatsoever which may at any
time (including, without limitation, at any time following the payment of the
Obligations) be imposed on, incurred by or asserted against any such indemnitee
in any way relating to or arising out of any Credit Document or any documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by any such
indemnitee under or in connection with any of the foregoing; provided, however,
that no Lender shall be liable for the payment of any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements to the extent resulting from such
indemnitee’s gross negligence or willful misconduct, as determined by a court
of competent jurisdiction.  The
provisions of this Section shall survive the termination of this Agreement
and the payment in full of the Obligations.


 


Section 8.8                                   Administrative Agent in Its
Individual Capacity.


 


The
Person serving as the Administrative Agent hereunder shall have the same rights
and powers in its capacity as a Lender as any other Lender and may exercise the
same as though it were not the Administrative Agent and the term “Lender” or “Lenders”
shall, unless otherwise expressly indicated or unless the context otherwise
requires, include the Person serving as the Administrative Agent hereunder in
its individual capacity.  Such Person and
its Affiliates may accept deposits from, lend money to, act as the financial
advisor or in any other advisory capacity for and generally engage in any kind
of business with the Borrowers or any Subsidiary or other Affiliate thereof as
if such Person were not the Administrative Agent hereunder and without any duty
to account therefor to the Lenders.


 


Section 8.9                                   Successor Administrative
Agent.


 


The
Administrative Agent may at any time give notice of its resignation to the
Lenders and the Borrowers; provided, that the Borrower has approved such
resignation which such approval shall not be unreasonably withheld, conditioned
or delayed.  Upon receipt of any such
notice of resignation, the Required Lenders shall have the right, in
consultation with the Borrowers, to appoint a successor, or an Affiliate of any
such bank.  If no such successor shall
have been so appointed by the Required Lenders and shall have accepted such
appointment within thirty (30) days after the retiring Administrative
Agent gives notice of its resignation, then the retiring Administrative Agent
may on behalf of the Lenders, appoint a successor Administrative Agent meeting
the qualifications set forth above provided that if the Administrative Agent
shall notify the Borrowers and the Lenders that no qualifying Person has
accepted such appointment, then such resignation shall nonetheless become
effective in accordance with such notice and (a) the retiring
Administrative Agent shall be discharged from its duties and obligations
hereunder and under the other Credit Documents (except that in the case of any
Collateral held by the Administrative Agent on behalf of the Lenders under any
of the Credit Documents, the retiring Administrative Agent shall continue to
hold such Collateral until such time as a successor Administrative Agent is
appointed) and (b) all payments, communications and determinations
provided to be made by, to or through the Administrative Agent shall instead be
made by or to each Lender directly, until such time as the Required Lenders
appoint a successor Administrative Agent as provided for above in this
paragraph.  Upon the acceptance of a
successor’s appointment as Administrative Agent hereunder, such successor shall
succeed to and become vested with all of the rights, powers, privileges and
duties of the retiring (or retired) Administrative Agent, and the retiring
Administrative Agent shall be discharged from all of its duties and obligations
hereunder or under the other Credit Documents (if not already discharged
therefrom as provided above in this paragraph). 
The fees payable by the Borrowers to a successor Administrative Agent
shall be the same as those payable to its predecessor unless otherwise agreed
between the Borrowers and such successor. 
After the retiring Administrative Agent’s resignation hereunder and
under the other Credit Documents, the provisions of this Article and Section 10.5  shall 


 


106

















 


continue
in effect for the benefit of such retiring Administrative Agent, its sub-agents
and their respective Related Parties in respect of any actions taken or omitted
to be taken by any of them while the retiring Administrative Agent was acting
as Administrative Agent.


 


Section 8.10                            Collateral and Guaranty
Matters.


 


(a)                                  The Lenders
irrevocably authorize and direct the Administrative Agent:


 


(i)                                     to release any
Lien on any Collateral granted to or held by the Administrative Agent under any
Credit Document (i) upon termination of the Revolving Commitments and
payment in full of all Obligations (other than contingent indemnification
obligations for which no claim has been made or cannot be reasonably identified
by an Indemnitee based on the then-known facts and circumstances), or (ii) subject
to Section 10.1, if approved, authorized or ratified in writing by the
Required Lenders;


 


(ii)                                  to subordinate
any Lien on any Collateral granted to or held by the Administrative Agent under
any Credit Document to the holder of any Lien on such Collateral that is
permitted by Section 6.2; and


 


(iii)                               to release any
Guarantor from its obligations under the applicable Guaranty if such Person
ceases to be a Guarantor as a result of a transaction permitted hereunder.


 


(b)                                 In connection with a
termination or release pursuant to this Section, the Administrative Agent shall
promptly execute and deliver to the applicable Credit Party, at the  Borrowers’ expense, all documents that the applicable
Credit Party shall reasonably request to evidence such termination or
release.  Upon request by the
Administrative Agent at any time, the Required Lenders will confirm in writing
the Administrative Agent’s authority to release or subordinate its interest in
particular types or items of Collateral, or to release any Guarantor from its
obligations under the Guaranty pursuant to this Section.


 


ARTICLE IX


 


ADMINISTRATION AND SERVICING


 


Section 9.1                                   Servicing.


 


(a)                                  The Administrative Agent
hereby appoints each of the Borrowers as its agent to service the Collateral
and enforce its rights in and under such Collateral.  The Borrowers hereby accept such appointment
and agree to perform the duties and obligations with respect thereto as set
forth herein.


 


(b)                                 The Borrowers covenants to
maintain or cause the servicing of the Collateral to be maintained in
conformity with Accepted Servicing Practices and in a manner at least equal in
quality to the servicing Borrowers provides for Mortgage Assets that it
owns.  In the event that the preceding
language is interpreted as constituting one or more servicing contracts, each
such servicing contract shall terminate automatically upon the earliest of (i) an
Event of Default, (ii) the date on which this Agreement terminates or the
Administrative Agent releases its Lien 


 


107

















 


with
respect to the related item of Collateral or (iii) the transfer of
servicing approved in writing by the Administrative Agent.


 


Section 9.2                                   Borrowers as Servicer.


 


If
the Collateral is serviced by the Borrowers, the Borrowers agree that, until
the item of Collateral is released from the Administrative Agent’s Lien, the
Administrative Agent has a security interest in all servicing records for the
period that the Administrative Agent has a Lien on the Collateral, including,
but not limited to, any and all servicing agreements, files, documents,
records, data bases, computer tapes, copies of computer tapes, computer programs,
proof of insurance coverage, insurance policies, appraisals, other closing
documentation, payment history records, and any other records relating to or
evidencing the servicing of such Collateral (the “Servicing Records”).  The Borrowers covenant to safeguard such
Servicing Records and to deliver them promptly to Administrative Agent or its
designee (including the Custodian) at the Administrative Agent’s request.


 


Section 9.3                                   Third Party Servicer.


 


The
Borrowers shall not cause the Collateral to be serviced by a third party other
than pursuant to the Servicing Agreements or the Pooling and Servicing
Agreements or, if not serviced thereunder, by any Servicer other than a
Servicer approved in writing by the Administrative Agent in its reasonable
discretion, which approval shall be deemed granted by the Administrative Agent
with respect to each Servicer listed on Schedule 9.3 attached
hereto, as such schedule may be amended or supplemented from time to time,
after the execution of this Agreement. 
If the Collateral is serviced by a Servicer or a PSA Servicer pursuant
to a Servicing Agreement or Pooling and Servicing Agreement, as applicable, the
Borrowers (i) shall, in accordance with Section 4.2, provide to the
Administrative Agent (subject to the last sentence of this Section) a copy of
each Servicing Agreement and Pooling and Servicing Agreement, which agreements
shall be in form and substance acceptable to the Administrative Agent, and a
Servicer Redirection Notice, fully executed by the Borrowers and the related
Servicer or PSA Servicer, and (ii) hereby irrevocably assigns to the
Administrative Agent and the Administrative Agent’s successors and assigns all
right, title and interest of the Borrowers in, to and under, and the benefits
of (but not the obligations of), each Servicing Agreement and each Pooling and
Servicing Agreement with respect to the Collateral.  Notwithstanding the fact that the Borrowers
have contracted with the Servicers or PSA Servicers to service the Collateral,
the Borrowers shall remain liable to the Administrative Agent for the acts of
the Servicers and PSA Servicers and for the performance of the duties and
obligations set forth herein.  The
Borrowers agree that no Person shall assume the servicing obligations with
respect to the Collateral as successor to a Servicer or PSA Servicer unless
such successor is reasonably approved in writing by the Administrative Agent
prior to such assumption of servicing obligations.  Unless otherwise approved in writing by the
Administrative Agent, if the Collateral is serviced by a Servicer or PSA
Servicer, such servicing shall be performed pursuant to a written Servicing
Agreement or Pooling and Servicing Agreement approved by the Administrative
Agent.


 


Section 9.4                                   Duties of the Borrowers.


 


(a)                                  Duties.  The Borrowers shall take or cause to be taken
all such actions as may be necessary or advisable to collect all Income and
other amounts due or recoverable with respect to the Collateral from time to
time, all in accordance with Requirement of Law, with reasonable care and
diligence, and in accordance with the standard set forth in Section 9.1(b).


 


(b)                                 Administrative Agent’s
Rights.  Notwithstanding anything to
the contrary contained herein, the exercise by the Administrative Agent of its
rights hereunder shall not release the Borrowers from any of its duties or
responsibilities with respect to the Collateral.  The


 


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Administrative
Agent shall not have any obligation or liability with respect to any
Collateral, nor shall any of them be obligated to perform any of the
obligations of the Borrowers hereunder.


 


(c)                                  Servicing Programs.  In the event that the Borrowers or the
Servicers use any software program in servicing the Collateral that is licensed
from a third party, the Borrowers shall use their reasonable efforts to obtain,
either before the Restatement Date or as soon as possible thereafter, whatever
licenses or approvals are necessary to allow the Administrative Agent to use
such programs.


 


Section 9.5                                   Authorization of the
Borrowers.


 


(a)                                  The Administrative Agent
hereby authorizes the Borrowers (including any successor thereto) to take any
and all reasonable steps in its name and on its behalf necessary or desirable
and not inconsistent with the pledge of the Collateral to the Administrative
Agent to collect all amounts due under any and all Collateral, including,
without limitation, endorsing any checks and other instruments representing
Income, executing and delivering any and all instruments of satisfaction or
cancellation, or of partial or full release or discharge, and all other
comparable instruments, with respect to the Collateral and, after the
delinquency of any Collateral and to the extent permitted under and in
compliance with Requirements of Law, to commence proceedings with respect to
enforcing payment thereof, to the same extent as the Borrowers could have done
if it had continued to own such Collateral free of the Lien of the
Administrative Agent.  The Administrative
Agent shall furnish the Borrowers (and any successors thereto) with any powers
of attorney and other documents necessary or appropriate to enable the Borrowers
to carry out their servicing and administrative duties hereunder and shall
cooperate with the Borrowers to the fullest extent in order to ensure the
collectibility of the Collateral.  In no
event shall the Borrowers be entitled to make the Administrative Agent a party
to any litigation without the Administrative Agent’s express prior written
consent.


 


(b)                                 Subject to all other rights
of the Administrative Agent contained herein, after an Event of Default has
occurred and is continuing, at the direction of the Administrative Agent, the
Borrowers shall take such action as the Administrative Agent may deem necessary
or advisable to enforce collection of the Collateral; provided, however,
subject to all other rights of the Administrative Agent contained herein, the
Administrative Agent may, at any time that an Event of Default or Default has
occurred and is continuing, notify any Obligor
with respect to any Collateral of the assignment of such Collateral to the
Administrative Agent and direct that payments of all amounts due or to become
due be made directly to the Administrative Agent or any servicer, collection
agent or lock—box or other account designated by the Administrative Agent and,
upon such notification and at the expense of the Borrowers, the Administrative
Agent may enforce collection of any such Collateral and adjust, settle or
compromise the amount or payment thereof.


 


Section 9.6                                   Event of Default.


 


If
the servicer of the Collateral is any Borrower, upon the occurrence of an Event
of Default, the Administrative Agent shall have the right to terminate the Borrowers as the servicer of the
Collateral and transfer servicing to its designee, at no cost or expense to the
Administrative Agent, at any time thereafter. 
If the servicer of the Collateral is not any of the Borrowers, the Administrative
Agent shall have the right, as contemplated in the applicable Servicer
Redirection Notice, upon the occurrence of an Event of Default, to terminate
any Servicer and any applicable Servicing Agreement and any PSA Servicer and
any applicable Pooling and Servicing Agreement to the extent a PSA Servicer
signed a Servicer Redirection Notice and, in each case, to transfer servicing
to its designee, at no cost or expense to the Administrative 


 


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Agent,
it being agreed that the Borrowers will pay any and all fees required to
terminate each such Servicer, PSA Servicer, Servicing Agreement and Pooling and
Servicing Agreement and to effectuate the transfer of servicing to the designee
of the Administrative Agent.  The
Borrowers shall cooperate fully and shall cause all Servicers and applicable
PSA Servicers to cooperate fully with the Administrative Agent in transferring
the servicing of the Collateral to the Administrative Agent’s designee.


 


Section 9.7                                   Modification.


 


Unless
otherwise agreed to by the Administrative Agent in its discretion until the
Administrative Agent releases its Lien on any item of Collateral, neither the
Borrowers, the Servicers, PSA Servicer (unless otherwise provided in a Pooling and
Servicing Agreement) nor any other Person acting on behalf of the foregoing
shall have any right without the Administrative Agent’s prior written consent
in its discretion to (i) waive, amend, modify or alter the material
economic terms of any item or Collateral (including, without limitation, the
related Mortgage Loan Documents), the Servicing Agreements or the Pooling and
Servicing Agreements or (ii) exercise any material rights of a holder of
any item of Collateral under any document or agreement governing or relating to
such Collateral.


 


Section 9.8                                   Inspection.


 


In
the event the Borrowers or their Affiliates are servicing the Collateral, the
Borrowers shall permit the Administrative Agent to inspect the Borrowers’ and
any of their Affiliates’ servicing facilities, books and records and related
documents and information, as the case may be, for the purpose of satisfying
the Administrative Agent that that Borrowers or their Affiliates, as the case
may be, have the ability to service and are servicing the Collateral as
provided in this Agreement.  If a
Servicer or PSA Servicer is servicing any Collateral, the Borrowers shall
cooperate with the Administrative Agent in causing each Servicer and PSA
Servicer to permit inspections of the Servicer’s and PSA Servicer’s facilities,
books and records and related documents and information relating to the
Collateral.


 


Section 9.9                                   [Reserved].


 


Section 9.10                            Payment of Certain Expenses
by Servicer.


 


The
Borrowers and any Servicer will be required to pay all expenses incurred by
them in connection with their activities under this Agreement and the other
Credit Documents, including fees and disbursements of independent accountants,
Taxes imposed on the Borrowers or the Servicers, expenses incurred in
connection with payments and reports pursuant to this Agreement and the other
Credit Documents, and all other fees and expenses under this Agreement and the
other Credit Documents for the account of the Borrowers.  The Borrowers shall be required to pay all
reasonable fees and expenses owing to any bank or trust company in connection
with the maintenance of the Collection Account and all other collection,
reserve or lock—box accounts related to the Collateral.


 


Section 9.11                            Pooling and Servicing
Agreements.


 


Notwithstanding
the provisions of this Article IX, to the extent the Collateral (or
portions thereof) are serviced by a PSA Servicer (other than the Borrowers or
any Servicer) under a Pooling and Servicing Agreement, (a) the standards
for servicing such items of Collateral shall be those set forth in the
applicable Pooling and Servicing Agreement, to the extent of the items covered
therein, and otherwise as provided in this Agreement, (b) the Borrowers
shall enforce its rights and interests under such agreements for and on behalf
of itself and the Administrative Agent, (c) the Borrowers shall instruct
the applicable PSA Servicer to deposit all Income received in respect of the
Collateral into the Collection Account in accordance with Section 5.17 of
this Agreement, (d) the Borrowers shall not take any action or fail to
take 


 


110

















 


any
action or consent to any action or inaction under any Pooling and Servicing
Agreement where the effect of such action or inaction would prejudice or
adversely affect the interests of the Administrative Agent, (e) the
Administrative Agent shall be entitled to exercise any and all rights of the
Borrowers or the holder of any such item of Collateral under such Pooling and
Servicing Agreements as such rights relate to the Collateral, and (f) the
Borrowers shall not consent to any amendment or modification to any Pooling and
Servicing Agreement without the prior written consent of the Administrative
Agent in its reasonable discretion.


 


Section 9.12                            Servicer Default.


 


Any
material breach by the Borrowers of the obligations contained in this Article IX
or in Sections 2.9(a) and 5.17 shall constitute a “Servicer
Default”.


 


ARTICLE X


 


MISCELLANEOUS


 


Section 10.1                            Amendments, Waivers and
Release of Collateral.


 


Neither this Agreement nor any of the other Credit Documents, nor any
terms hereof or thereof may be amended, modified, waived, extended, restated,
replaced, or supplemented (by amendment, waiver, consent or otherwise) except
in accordance with the provisions of this Section nor may Collateral be
released except as specifically provided herein or in the Security Documents or
in accordance with the provisions of this Section.  The Required Lenders may or, with the written
consent of the Required Lenders, the Administrative Agent may, from time to
time, (a) enter into with the Borrowers written amendments, supplements or
modifications hereto and to the other Credit Documents for the purpose of
adding any provisions to this Agreement or the other Credit Documents or
changing in any manner the rights of the Lenders or of the Borrowers hereunder
or thereunder or (b) waive or consent to the departure from, on such terms
and conditions as the Required Lenders may specify in such instrument, any of
the requirements of this Agreement or the other Credit Documents or any Default
or Event of Default and its consequences; provided, however, that
no such amendment, supplement, modification, release, waiver or consent shall:


 


(i)                                     reduce the
amount or extend the scheduled date of maturity of any Loan or Note or any
installment thereon (except in accordance with Section 2.1(f) or Section 2.2(a)),
or reduce the stated rate of any interest or fee payable hereunder (except in
connection with a waiver of interest at the increased post-default rate set
forth in Section 2.6 which shall be determined by a vote of the Required
Lenders) or extend the scheduled date of any payment thereof or increase the
amount or extend the expiration date of any Lender’s Commitment, in each case
without the written consent of each Lender directly affected thereby; provided
that, it is understood and agreed that (A) no waiver, reduction or
deferral of a mandatory prepayment required pursuant to Section 2.5(b),
nor any amendment of Section 2.5(b) or the definitions of Asset
Value, Debt Issuance, Equity Issuance or Extraordinary Receipt,  shall constitute a reduction of the amount of, or an
extension of the scheduled date of, the scheduled date of maturity of, or any
installment of, any Loan or Note, (B) any reduction in the stated rate of
interest on Revolving Loans shall only require the written consent of each
Lender holding a Revolving Commitment and (C) any reduction in the stated
rate of interest on the Term Loan shall only require the written consent of each
Lender holding a portion of the outstanding Term Loan; or


 


111

















 


(ii)                                  amend, modify
or waive any provision of this Section or reduce the percentage specified
in the definition of Required Lenders, without the written consent of all the
Lenders; or


 


(iii)                               release any
Borrower or all or substantially all of the Guarantors from obligations under
the Guaranty, without the written consent of all of the Lenders; or


 


(iv)                              release all or
substantially all of the Collateral without the written consent of all of the
Lenders; or


 


(v)                                 subordinate the
Loans to any other Indebtedness without the written consent of all of the
Lenders; or


 


(vi)                              permit any
Borrower to assign or transfer any of its rights or obligations under this
Agreement or other Credit Documents without the written consent of all of the
Lenders; or


 


(vii)                           amend, modify
or waive any provision of the Credit Documents requiring consent, approval or
request of the Required Lenders or all Lenders without the written consent of
the Required Lenders or all the Lenders as appropriate; or


 


(viii)                        without the
consent of Revolving Lenders holding in the aggregate more than 50% of the
outstanding Revolving Commitments (or if the Revolving  Commitments have been terminated, the
aggregate principal amount of outstanding Revolving Loans), amend, modify or
waive any provision in Section 4.2 or waive any Default or Event of
Default (or amend any Credit Document to effectively waive any Default or Event
of Default) if the effect of such amendment, modification or waiver is that the
Revolving Lenders shall be required to fund Revolving Loans when such Lenders
would otherwise not be required to do so; or


 


(ix)                                amend, modify
or waive the order in which Obligations are paid or in a manner that would
alter the pro rata sharing of payments by and among the Lenders in Section 2.9
without the written consent of each Lender directly affected thereby; or


 


(x)                                   amend, modify
or waive any provision of Article VIII without the written consent of the
then Administrative Agent; or


 


(xi)                                amend, modify
or waive any provision in Sections 3.3 through 3.6 without the written consent
of the Custodian; or


 


(xii)                             amend or modify
the definition of Obligations to delete or exclude any obligation or liability
described therein without the written consent of each Lender directly affected
thereby;


 


provided, further, that no amendment, waiver or
consent affecting the rights or duties of the Administrative Agent under any
Credit Document shall in any event be effective, unless in writing and signed
by the Administrative Agent, in addition to the Lenders required hereinabove to
take such action.  Unless otherwise
expressly provided herein, waivers shall be effective only in the specific
instance and for the specific purpose for which given.


 


112

















 


Any such waiver, any such amendment, supplement or modification and any
such release shall apply equally to each of the Lenders and shall be binding
upon the Borrowers, the other Credit Parties, the Lenders, the Administrative
Agent and all future holders of the Notes. 
In the case of any waiver, the Borrowers, the other Credit Parties, the
Lenders and the Administrative Agent shall be restored to their former position
and rights hereunder and under the outstanding Loans and Notes and other Credit
Documents, and any Default or Event of Default waived shall be deemed to be
cured and not continuing; but no such waiver shall extend to any subsequent or
other Default or Event of Default, or impair any right consequent thereon.


 


Notwithstanding any of the foregoing to the contrary, the consent of
the Borrowers and the other Credit Parties shall not be required for any
amendment, modification or waiver of the provisions of Article VIII (other
than the provisions of Section 8.9).


 


Notwithstanding the fact that the consent of all the Lenders is
required in certain circumstances as set forth above, (a) each Lender is
entitled to vote as such Lender sees fit on any bankruptcy reorganization plan
that affects the Loans, and each Lender acknowledges that the provisions of Section 1126(c) of
the Bankruptcy Code supersedes the unanimous consent provisions set forth
herein and (b) the Required Lenders may consent to allow a Credit Party to
use cash collateral in the context of a bankruptcy or insolvency proceeding.


 


For
the avoidance of doubt and notwithstanding any provision to the contrary
contained in this Section 10.1, this Agreement may be amended (or amended
and restated) with the written consent of the Credit Parties and the Required
Lenders (i) to increase the aggregate Commitments of the Lenders (provided
that no Lender shall be required to increase its commitment without its
consent), (ii) to add one or more additional borrowing Tranches to this
Agreement and to provide for the ratable sharing of the benefits of this
Agreement and the other Credit Documents with the other then outstanding
Obligations in respect of the extensions of credit from time to time
outstanding under such additional borrowing Tranche(s) and the accrued
interest and fees in respect thereof and (iii) to include appropriately
the lenders under such additional borrowing Tranches in any determination of
the Required Lenders and/or to provide consent rights to such lenders under
subsections (ix) and/or (x) of Section 10.1 corresponding
to the consent rights of the other Lenders thereunder.


 


Section 10.2                            Notices.


 


(a)                                  Notices Generally.  Except in the case of notices and other
communications expressly permitted to be given by telephone (and except as
provided in paragraph (b) below), all notices and other communications
provided for herein shall be in writing and shall be delivered by hand or
overnight courier service, mailed by certified or registered mail or sent by telecopier
as follows:


 


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(i)                                   If to the
Borrowers or any other Credit Party:


 


c/o
NorthStar Realty Finance Corp.


399 Park Avenue, 18th floor


New York, New York 10022


Attention:                                                                                         Andy Richardson


Al Tylis, Esq.


Daniel R. Gilbert


Facsimile No.:                                                                 (212) 547—2700


Confirmation No.:                                             (212) 547—2650


(212) 547—2641


(212)
547—2680


 


with a copy to:


 


Paul
Hastings Janofsky & Walker LLP


75 East 55th Street


New York, New York  10022


Attention:                                                                                         Robert J.
Grados, Esq.


Facsimile No.:                                                                 (212) 230—7830


Confirmation No.:                                             (212) 318—6923


 


(ii)                                If to the
Administrative Agent:


 


Wachovia Bank, National Association


One Wachovia Center, NC0166


301 South College Street


Charlotte, North Carolina  28288


 


Attention:                                                                                         Lee Goins


Facsimile No.:                                                                 (704) 715-0666


Confirmation
No.:                                             (704) 715-7655


 


with
a copy to:


 


Wachovia
Bank, National Association


100
Fidelity Plaza


MAC:
M6149-011


North
Brunswick, NJ 08902


Attention:                                                                                         Kenneth F.
Cogland


Confirmation No.:                                             (732) 565-5714


 


with a copy to:


 


Moore & Van Allen PLLC


100 N. Tryon Street, Suite 4700


Charlotte, North Carolina  28202


Attention:                                                                                         Kenneth P. Kerr, Esq.


Facsimile No.:                                                                 (704) 378—2097


Confirmation No.:                                             (704) 331—1145


Attention:                                                                                         Noelle Sproul, Esq.


Facsimile No.:                                                                 (704) 378—1916


Confirmation No.:                                             (704) 331—1116


 


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(iii)                               if to a Lender,
to it at its address (or telecopier number) set forth in its Administrative
Questionnaire.


 


Notices
sent by hand or overnight courier service, or mailed by certified or registered
mail, shall be deemed to have been given when received; notices sent by
telecopier shall be deemed to have been given when sent (except that, if not
given during normal business hours for the recipient, shall be deemed to have
been given at the opening of business on the next Business Day for the
recipient).  Notices delivered through
electronic communications to the extent provided in paragraph (b) below,
shall be effective as provided in said paragraph (b).


 


(b)                                 Electronic Communications.  Notices and other communications to the
Lenders hereunder may be delivered or furnished by electronic communication
(including e-mail and internet or intranet websites) pursuant to procedures
approved by the Administrative Agent, provided that the foregoing shall
not apply to notices to any Lender pursuant to Article II if such Lender
has notified the Administrative Agent that it is incapable of receiving notices
under such Article by electronic communication.  The Administrative Agent or the Borrowers
may, in its discretion, agree to accept notices and other communications to it
hereunder by electronic communications pursuant to procedures approved by it, provided
that approval of such procedures may be limited to particular notices or
communications.


 


Unless
the Administrative Agent otherwise prescribes, (i) notices and other
communications sent to an e-mail address shall be deemed received upon the
sender’s receipt of an acknowledgement from the intended recipient (such as by
the “return receipt requested” function, as available, return e-mail or other
written acknowledgement), provided that if such notice or other
communication is not sent during the normal business hours of the recipient,
such notice or communication shall be deemed to have been sent at the opening of
business on the next Business Day for the recipient, and (ii) notices or
communications posted to an internet or intranet website shall be deemed
received upon the deemed receipt by the intended recipient at its e-mail
address as described in the foregoing clause (i) of notification that
such notice or communication is available and identifying the website address
therefor.


 


(c)                                  Change of Address, Etc.  Any party hereto may change its address or
telecopier number for notices and other communications hereunder by notice to
the other parties hereto.


 


Section 10.3                            No Waiver; Cumulative
Remedies.


 


No failure to exercise and no delay in exercising, on the part of the
Administrative Agent or any Lender, any right, remedy, power or privilege
hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, remedy, power or privilege hereunder preclude any other
or further exercise thereof or the exercise of any other right, remedy, power
or privilege.  The rights, remedies,
powers and privileges herein provided are cumulative and not exclusive of any
rights, remedies, powers and privileges provided by Requirements of Law.


 


Section 10.4                            Survival of Representations
and Warranties.


 


All representations and warranties made hereunder and in any document,
certificate or statement delivered pursuant hereto or in connection herewith
shall survive the execution and delivery of this Agreement and the Notes and
the making of the Loans; provided that all such representations and 


 


115

















 


warranties shall terminate on the date upon which the Commitments have
been terminated and all Obligations owing under any Notes or the other Credit
Documents have been paid in full.


 


Section 10.5                            Payment of Expenses and
Taxes; Indemnity.


 


(a)                                  Costs and Expenses.  The Borrowers shall pay (i) all
reasonable out-of-pocket expenses incurred by the Administrative Agent and its
Affiliates (including the reasonable fees, charges and disbursements of counsel
for the Administrative Agent) in connection with the preparation, negotiation,
execution, delivery and administration of this Agreement and the other Credit
Documents or any amendments, modifications or waivers of the provisions hereof
or thereof (whether or not the transactions contemplated hereby or thereby
shall be consummated), (ii) all reasonable out-of-pocket expenses incurred
by the Administrative Agent or any Lender, (including the fees, charges and
disbursements of any counsel for the Administrative Agent or any Lender) in
connection with the enforcement or protection of its rights (A) in
connection with this Agreement and the other Credit Documents, including its
rights under this Section, or (B) in connection with the Loans made,
including all such reasonable out-of-pocket expenses incurred during any
workout, restructuring or negotiations in respect of such Loans, (iii) the
Borrowers shall pay on demand any and all stamp, sales, excise and other taxes
and fees payable or determined to be payable in connection with the execution,
delivery, filing and recording of this Agreement, the Credit Documents or the
other documents to be delivered hereunder or thereunder or the funding or
maintenance of Loans hereunder and (iv) all reasonable due diligence,
inspection, audit, testing, review, recording, travel, lodging or other
administrative expenses and costs incurred by the Administrative Agent or any
Lender in connection with the review, consideration, pledge or proposed pledge
of any Mortgage Asset or other Collateral or proposed Collateral (including any
costs necessary or incidental to the pledge of the Mortgage Assets or other
Collateral or the making of any Loan in connection therewith).  The provisions of this Section shall
survive the termination of this Agreement and the payment in full of the
Obligations.


 


(b)                                 Indemnification
by the Borrowers.


 


(i)                                     The Borrowers
shall indemnify the Administrative Agent (and any sub-agent thereof), each
Lender, and each Related Party of any of the foregoing Persons (each such Person
being called an “Indemnitee”) against, and hold each Indemnitee harmless
from, any and all actual, out-of-pocket losses; claims; penalties; fines;
actual, out-of-pocket damages; actual, out-of-pocket liabilities and related
actual, out-of-pocket expenses (including the reasonable fees, charges and
disbursements of any counsel for any Indemnitee) incurred by any Indemnitee or
asserted against any Indemnitee by any third party or by the Borrowers or any
other Credit Party (collectively, the “Indemnified Amounts”) arising out
of, in connection with, or as a result of (A) this Agreement, the Credit
Documents, any Loan, any Collateral, the Mortgage Loan Documents, any
transaction or Extension of Credit contemplated hereby or thereby, or any
amendment, supplement, extension or modification of, or any waiver or consent
under or in respect of this Agreement, the Credit Documents, any Loan, any
Collateral, the Mortgage Loan Documents or any transaction or Extension of
Credit contemplated hereby or thereby, (B) any Mortgage Asset or any other
Collateral under the Credit Documents, (C) any violation or alleged
violation of, non—compliance with or liability under any Requirement of Law
(including, without limitation, violation of Securities Laws and Environmental
Laws), (D) ownership of, Liens on, security interests in or the exercise
of rights and/or remedies under the Credit Documents, the Mortgage Loan
Documents, the Collateral, any other collateral under the Credit Documents, the
Underlying Mortgaged Property, any 


 


116

















 


other
related Property or collateral or any part thereof or any interest therein or
receipt of any Income or rents, (E) any accident, injury to or death of
any person or loss of or damage to Property occurring in, on or about any
Underlying Mortgaged Property, any other related Property or collateral or any
part thereof, the related Collateral or on the adjoining sidewalks, curbs,
parking areas, streets or ways, (F) any use, nonuse or condition in, on or
about, or possession, alteration, repair, operation, maintenance or management
of, any Underlying Mortgaged Property, any other related Property or collateral
or any part thereof or on the adjoining sidewalks, curbs, parking areas,
streets or ways, (G) any failure on the part of the Credit Parties to
perform or comply with any of the terms of the Mortgage Loan Documents, the
Credit Documents, the Collateral or any other collateral under the Credit
Documents, (H) performance of any labor or services or the furnishing of
any materials or other Property in respect of the Underlying Mortgaged
Property, any other related Property or collateral, the Collateral or any part
thereof, (I) any claim by brokers, finders or similar Persons claiming to
be entitled to a commission in connection with any lease or other transaction
involving any Underlying Mortgaged Property, any other related Property or
collateral, the Collateral or any part thereof or the Credit Documents, (J) any
Taxes including, without limitation, any Taxes attributable to the execution,
delivery, filing or recording of any Credit Document, any Mortgage Loan
Document or any memorandum of any of the foregoing, (K) any Lien or claim
arising on or against the Underlying Mortgaged Property, any other related
Property or collateral, the Collateral or any part thereof under any
Requirement of Law or any liability asserted against the Administrative Agent
or any Lender with respect thereto, (L) the claims of any lessee or any
Person acting through or under any lessee or otherwise arising under or as a
consequence of any leases with respect to any Underlying Mortgaged Property,
related Property or collateral, or any claims of an Obligor, (M) any civil
penalty or fine assessed by OFAC against, and all reasonable costs and expenses
(including counsel fees and disbursements) incurred in connection with the
defense thereof, by any Indemnitee as a result of conduct of any Credit Party
that violates any sanction enforced by OFAC, (N) any and all Indemnified
Amounts arising out of, attributable or relating to, accruing out of, or
resulting from (1) a past, present or future violation or alleged
violation of any Environmental Laws in connection with any Property or
Underlying Mortgaged Property by any Person or other source, whether related or
unrelated to any other Credit Party or any Obligor, (2) any presence of
any Materials of Environmental Concern in, on, within, above, under, near,
affecting or emanating from any Property or Underlying Mortgaged Property, (3) the
failure to timely perform any Remedial Work, (4) any past, present or
future activity by any Person or other source, whether related or unrelated to
any Credit Party or any Obligor in connection with any actual, proposed or
threatened use, treatment, storage, holding, existence, disposition or other
release, generation, production, manufacturing, processing, refining, control,
management, abatement, removal, handling, transfer or transportation to or from
any Property or Underlying Mortgaged Property of any Materials of Environmental
Concern at any time located in, under, on, above or affecting any Property or
Underlying Mortgaged Property, (5) any past, present or future actual
Release (whether intentional or unintentional, direct or indirect, foreseeable
or unforeseeable) to, from, on, within, in, under, near or affecting any
Property or Underlying Mortgaged Property by any Person or other source,
whether related or unrelated to any Credit Party or any Obligor, (6) the
imposition, recording or filing or the threatened imposition, recording or
filing of any Lien on any Property or Underlying Mortgaged Property with regard
to, or as a result of, any Materials of Environmental Concern or pursuant to
any Environmental Law, or (7) any misrepresentation or inaccuracy in any
representation or warranty in any material respect or material breach or
failure to perform any covenants or 


 


117

















 


other
obligations pursuant to this Agreement, the other Credit Documents or any of
the Mortgage Loan Documents or relating to environmental matters in any way
including, without limitation, under any of the Mortgage Loan Documents or (O) any
Credit Party’s conduct, activities, actions and/or inactions in connection
with, relating to or arising out of any of the foregoing clauses of this Section that,
in each case, results from anything other than any Indemnitee’s gross
negligence or willful misconduct.  In any
suit, proceeding or action brought by an Indemnitee in connection with any
Collateral or any other collateral under the Credit Documents for any sum owing
thereunder, or to enforce any provisions of any Collateral or any other
collateral under the Credit Documents, the Credit Parties shall save, indemnify
and hold such Indemnitee harmless from and against all expense, loss or damage
suffered by reason of any defense, set—off, counterclaim, recoupment or
reduction of liability whatsoever of the account debtor, obligor or Obligor
thereunder arising out of a breach by any Credit Party 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, obligor or Obligor or its
successors from any Credit Party.  Each
of the Credit Parties also agrees to reimburse an Indemnitee as and when billed
by such Indemnitee for all such Indemnitee’s costs, expenses and fees incurred
in connection with the enforcement or the preservation of such Indemnitee’s
rights under this Agreement, the Credit Documents, the Mortgage Loan Documents
and any transaction or Extension of Credit contemplated hereby or thereby,
including, without limitation, the reasonable fees and disbursements of its
counsel.  In the case of an
investigation, litigation or other proceeding to which the indemnity in this Section applies,
such indemnity shall be effective whether or not such investigation, litigation
or proceeding is brought by any Credit Party and/or any of their officers,
directors, shareholders, employees or creditors, an Indemnitee or any other
Person or any Indemnitee is otherwise a party thereto and whether or not any
transaction contemplated hereby is consummated.


 


(ii)                                  Any amounts
subject to the indemnification provisions of this Section shall be paid by
the Credit Parties to the Indemnitee within thirty (30) Business Days following
such Person’s demand therefor.  For the
avoidance of doubt, an Indemnitee may seek payment of any Indemnified Amount at
any time and regardless of whether a Default or an Event of Default then exists
or is continuing.


 


(iii)                               If for any
reason the indemnification provided in this Section is unavailable to the
Indemnitee or is insufficient to hold an Indemnitee harmless, then the Credit
Parties shall contribute to the amount paid or payable by such Indemnitee as a
result of such loss, claim, damage or liability in such proportion as is
appropriate to reflect not only the relative benefits received by such
Indemnitee on the one hand and the Credit Parties on the other hand but also
the relative fault of such Indemnitee as well as any other relevant equitable
considerations.


 


(iv)                              The obligations
of the Credit Parties under this Article X are joint and several and shall
survive the termination of this Agreement.


 


(v)                                 Indemnification
under this Section shall be in an amount necessary to make the Indemnitee
whole after taking into account any tax consequences to the Indemnitee of the
receipt of the indemnity provided hereunder, including the effect of such tax
or refund on the amount of tax measured by net income or profits that is or was
payable by the Indemnitee.


 


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(c)                                  Reimbursement by Lenders.  To the extent that the Borrowers for any
reason fail to indefeasibly pay any amount required under paragraph (a) or (b) of
this Section to be paid by it to the Administrative Agent (or any
sub-agent thereof), or any Related Party of any of the foregoing, each Lender
severally agrees to pay to the Administrative Agent (or any such sub-agent), or
such Related Party, as the case may be, such Lender’s Commitment Percentage
(determined as of the time that the applicable unreimbursed expense or
indemnity payment is sought) of such unpaid amount, provided that the
unreimbursed expense or indemnified loss, claim, damage, liability or related
expense, as the case may be, was incurred by or asserted against the
Administrative Agent (or any such sub-agent) in its capacity as such, or
against any Related Party of any of the foregoing acting for the Administrative
Agent (or any such sub-agent) in connection with such capacity.


 


(d)                                 Waiver of Consequential
Damages, Etc.  To the
fullest extent permitted by Requirements of Law, the Credit Parties and the
Lenders shall not assert, and hereby waive, any claim against any Indemnitee,
on any theory of liability, for special, indirect, consequential or punitive
damages (as opposed to direct or actual damages) arising out of, in connection
with, or as a result of, this Agreement, any other Credit Document or any
agreement or instrument contemplated hereby, the transactions contemplated
hereby or thereby, any Loan or the use of the proceeds thereof.  No Indemnitee referred to in paragraph (b) above
shall be liable for any damages arising from the use by unintended recipients
of any information or other materials distributed by it through
telecommunications, electronic or other information transmission systems in
connection with this Agreement or the other Credit Documents or the
transactions contemplated hereby or thereby. 
The provisions of this Section shall survive the termination of
this Agreement and the payment in full of the Obligations.


 


Section 10.6                            Successors and Assigns;
Participations.


 


(a)                                  Successors and Assigns
Generally.  The
provisions of this Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns permitted
hereby, except that neither the Borrowers nor any other Credit Party (other
than as permitted under Section 6.4) may assign or otherwise transfer any
of its rights or obligations hereunder without the prior written consent of the
Administrative Agent and each Lender and no Lender may assign or otherwise
transfer any of its rights or obligations hereunder except (i) to an
assignee in accordance with the provisions of paragraph (b) of this
Section, (ii) by way of participation in accordance with the provisions of
paragraph (d) of this Section or (iii) by way of pledge or
assignment of a security interest subject to the restrictions of
paragraph (f) of this Section (and any other attempted
assignment or transfer by any party hereto shall be null and void).  Nothing in this Agreement, expressed or
implied, shall be construed to confer upon any Person (other than the parties
hereto, their respective successors and assigns permitted hereby, Participants
to the extent provided in paragraph (d) of this Section and, to the
extent expressly contemplated hereby, the Related Parties of each of the
Administrative Agent and the Lenders) any legal or equitable right, remedy or
claim under or by reason of this Agreement.


 


(b)                                 Assignments by
Lenders.  Any Lender may at any time
assign to one or more assignees all or a portion of its rights and obligations
under this Agreement (including all or a portion of its Commitment and the
Loans at the time owing to it); provided that any such assignment shall
be subject to the following conditions:


 


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(i)                                    Minimum Amounts.


 


(A)                              in the case of
an assignment of the entire remaining amount of the assigning Lender’s
Commitment and the Loans at the time owing to it or in the case of an
assignment to a Lender, an Affiliate of a Lender or an Approved Fund, no
minimum amount need be assigned; and


 


(B)                                in any case not
described in paragraph (b)(i)(A) of this Section, the aggregate principal
amount of the Commitment (which for this purpose includes Loans outstanding
thereunder) or, if the applicable Commitment is not then in effect, the
principal outstanding balance of the Loans of the assigning Lender subject to
each such assignment (determined as of the date the Assignment and Assumption
with respect to such assignment is delivered to the Administrative Agent or, if
“Trade Date” is specified in the Assignment and Assumption, as of the Trade
Date) shall not be less than $1,000,000, in the case of any assignment in
respect of a revolving facility, or $1,000,000, in the case of any assignment
in respect of a term facility (provided, however, that
simultaneous assignments shall be aggregated in respect of a Lender and its
Approved Funds), unless each of the Administrative Agent and, so long as no
Event of Default has occurred and is continuing, the Borrowers otherwise
consent (each such consent not to be unreasonably withheld or delayed).


 


(ii)                                 Proportionate
Amounts.  Each partial assignment shall
be made as an assignment of a proportionate part of all the assigning Lender’s
rights and obligations under this Agreement with respect to the Loan or the
Commitment assigned, except that this clause (ii) shall not prohibit
any Lender from assigning all or a portion of its rights and obligations among
separate Tranches on a non-pro rata basis.


 


(iii)                              Required
Consents.  No consent
shall be required for any assignment except to the extent required by
paragraph (b)(i)(B) of this Section and, in addition:


 


(A)                              the consent of
the Borrowers (such consent not to be unreasonably withheld or delayed) shall
be required unless (x) an Event of Default has occurred and is continuing
at the time of such assignment or (y) such assignment is to a Lender, an
Affiliate of a Lender or an Approved Fund; and


 


(B)                                the consent of
the Administrative Agent (such consent not to be unreasonably withheld,
conditioned or delayed) shall be required for assignments in respect of (i) a
Revolving Commitment if such assignment is to a Person that is not a Lender
with a Commitment in respect of such facility, an Affiliate of such Lender or
an Approved Fund with respect to such Lender or (ii) a Term Loan
Commitment to a Person who is not a Lender, an Affiliate of a Lender or an
Approved Fund.


 


(iv)                             Assignment and
Assumption.  The parties
to each assignment shall execute and deliver to the Administrative Agent an
Assignment and Assumption, together with a processing and recordation fee of
$3,500  and the assignee, if it is not a
Lender, shall deliver to the Administrative Agent an Administrative
Questionnaire.


 


(v)                                No Assignment
to Credit Parties.  No such
assignment shall be made to any Credit Party or any of the Credit Parties’
Affiliates or Subsidiaries of a Credit Party.


 


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(vi)                             No Assignment
to Natural Persons.  No such
assignment shall be made to a natural person.


 


Subject to acceptance and
recording thereof by the Administrative Agent pursuant to paragraph (c) of
this Section, from and after the effective date specified in each Assignment
and Assumption, the assignee thereunder shall be a party to this Agreement and,
to the extent of the interest assigned by such Assignment and Assumption, have
the rights and obligations of a Lender under this Agreement, and the assigning
Lender thereunder shall, to the extent of the interest assigned by such
Assignment and Assumption, be released from its obligations under this
Agreement (and, in the case of an Assignment and Assumption covering all of the
assigning Lender’s rights and obligations under this Agreement, such Lender
shall cease to be a party hereto) but shall continue to be entitled to the
benefits of Sections 2.12 and 10.5  with respect
to facts and circumstances occurring prior to the effective date of such
assignment.  Any assignment or transfer
by a Lender of rights or obligations under this Agreement that does not comply
with this paragraph shall be treated for purposes of this Agreement as a sale
by such Lender of a participation in such rights and obligations in accordance
with paragraph (d) of this Section.


 


(c)                                  Register.  The Administrative Agent, acting solely for
this purpose as an agent of the Borrowers, shall maintain at one of its offices
in Charlotte, North Carolina a copy of each Assignment and Assumption delivered
to it and a register for the recordation of the names and addresses of the
Lenders, and the Commitments of, and principal amounts of the Loans owing to,
each Lender pursuant to the terms hereof from time to time (the “Register”).  The entries in the Register shall be
conclusive, and the Borrowers, the Administrative Agent and the Lenders may
treat each Person whose name is recorded in the Register pursuant to the terms
hereof as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary. 
The Register shall be available for inspection by the Borrowers and any
Lender, at any reasonable time and from time to time upon reasonable prior
notice.


 


(d)                                 Participations.  With the consent of the Administrative Agent,
any Lender may at any time, without the consent of, or notice to, the
Borrowers, sell participations to any Person (other than a natural person or
the Credit Parties or any of the Credit Parties’ Affiliates or Subsidiaries of
a Credit Party) (each, a “Participant”) in all or a portion of such
Lender’s rights and/or obligations under this Agreement (including all or a
portion of its Commitment and/or the Loans owing to it); provided that (i) such
Lender’s obligations under this Agreement shall remain unchanged, (ii) such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations and (iii) the Borrowers, the
Administrative Agent and the Lenders, shall continue to deal solely and
directly with such Lender in connection with such Lender’s rights and
obligations under this Agreement.


 


Any agreement or instrument
pursuant to which a Lender sells such a participation shall provide that such
Lender shall retain the sole right to enforce this Agreement and to approve any
amendment, modification or waiver of any provision of this Agreement; provided
that such agreement or instrument may provide that such Lender will not,
without the consent of the Participant, agree to any amendment, modification or
waiver that affects such Participant. 
Subject to paragraph (e) of this Section, the Borrowers agree
that each Participant shall be entitled to the benefits of Sections 2.12
and 2.13 to the same extent as if it were a Lender and had acquired its
interest by assignment pursuant to paragraph (b) of this
Section.  To the extent permitted by
Requirements of Law, each Participant also shall be entitled to the benefits of
Section 10.7  as though it were a Lender,
provided such Participant agrees to be subject to Section 2.9  as though it were a Lender.


 


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(e)                                  Limitations
upon Participant Rights.  A
Participant shall not be entitled to receive any greater payment under
Sections 2.12 and 2.14 than the applicable Lender would have been entitled
to receive with respect to the participation sold to such Participant, unless
the sale of the participation to such Participant is made with the Borrowers’
prior written consent.  A Participant
that would be a Foreign Lender if it were a Lender shall not be entitled to the
benefits of Section 2.14 unless the Borrowers are notified of the
participation sold to such Participant and such Participant agrees, for the
benefit of the Borrowers, to comply with Section 2.14  as
though it were a Lender.


 


(f)                                    Certain Pledges.  Any Lender may at any time pledge or assign a
security interest in all or any portion of its rights under this Agreement to
secure obligations of such Lender, including any pledge or assignment to secure
obligations to a Federal Reserve Bank; provided that no such pledge or
assignment shall release such Lender from any of its obligations hereunder or
substitute any such pledgee or assignee for such Lender as a party hereto.


 


Section 10.7                            Right of Set-off; Sharing of
Payments.


 


(a)                                  If an Event of Default shall have occurred and be continuing, each
Lender, and each of their respective Affiliates is hereby authorized at any
time and from time to time, to the fullest extent permitted by Requirements of
Law, to set off and apply any and all deposits (other than any deposits in a
Main Treasury Account) (general or special, time or demand, provisional or
final, in whatever currency) at any time held and other obligations (in
whatever currency) at any time owing by such Lender or any such Affiliate to or
for the credit or the account of the Borrowers against any and all of the
obligations of the Borrowers now or hereafter existing under this Agreement or
any other Credit Document to such Lender, irrespective of whether or not such
Lender shall have made any demand under this Agreement or any other Credit Document
and although such obligations of the Borrowers may be contingent or unmatured
or are owed to a branch or office of such Lender different from the branch or
office holding such deposit or obligated on such indebtedness.  The foregoing right shall not apply to
Excluded Accounts.  The rights of each
Lender and its respective Affiliates under this Section are in addition to
other rights and remedies (including other rights of setoff) that such Lender
or its respective Affiliates may have. 
Each Lender agrees to notify the Borrowers and the Administrative Agent
promptly after any such setoff and application, provided that the
failure to give such notice shall not affect the validity of such setoff and
application.


 


(b)                                 If any Lender shall, by
exercising any right of setoff or counterclaim or otherwise, obtain payment in
respect of any principal of or interest on any of its Loans or other
obligations hereunder resulting in such Lender’s receiving payment of a
proportion of the aggregate principal amount of its Loans and accrued interest
thereon or other such obligations greater than its pro rata
share thereof as provided herein, then the Lender receiving such greater
proportion shall (i) notify the Administrative Agent of such fact, and (ii) purchase
(for cash at face value) participations in the Loans and such other obligations
of the other Lenders, or make such other adjustments as shall be equitable, so
that the benefit of all such payments shall be shared by the Lenders ratably in
accordance with the aggregate amount of principal of and accrued interest on
their respective Loans and other amounts owing them, provided that:


 


(i)                                    if any such
participations are purchased and all or any portion of the payment giving rise
thereto is recovered, such participations shall be rescinded and the purchase
price restored to the extent of such recovery, without interest; and


 


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(ii)                                 the provisions
of this paragraph shall not be construed to apply to (A) any payment made by
the Borrowers pursuant to and in accordance with the express terms of this
Agreement or (B) any payment obtained by a Lender as consideration for the
assignment of or sale of a participation in any of its Loans to any assignee or
participant, other than to the Credit Parties or any Subsidiary or Affiliate
thereof (as to which the provisions of this paragraph shall apply).


 


(c)                                  For the avoidance of doubt,
the Administrative Agent and the Lenders, each for itself and for each such
entity’s successors, assigns and participants, hereby disclaim any right of
set-off, in common law or otherwise, against the Main Treasury Account and any
and all deposits (general or special, time or demand, provisional or final) or
credits in any currency therein.


 


(d)                                 Each Credit Party consents
to the foregoing and agrees, to the extent it may effectively do so under
Requirements of Law, that any Lender acquiring a participation pursuant to the
foregoing arrangements may exercise against each Credit Party rights of setoff
and counterclaim with respect to such participation as fully as if such Lender
were a direct creditor of each Credit Party in the amount of such
participation.


 


Section 10.8                            Table of Contents and Section Headings.


 


The table of contents and the Section and subsection headings
herein are intended for convenience only and shall be ignored in construing
this Agreement.


 


Section 10.9                            Counterparts; Integration;
Effectiveness; Electronic Execution.


 


(a)                                  Counterparts; Integration;
Effectiveness.  This
Agreement may be executed in counterparts (and by different parties hereto in
different counterparts), each of which shall constitute an original, but all of
which when taken together shall constitute a single contract.  This Agreement and the other Credit
Documents, and any separate letter agreements with respect to fees payable to
the Administrative Agent, constitute the entire contract among the parties
relating to the subject matter hereof and supersede any and all previous
agreements and understandings, oral or written, relating to the subject matter
hereof.  Except as provided in Section 4.1,
this Agreement shall become effective when it shall have been executed by the
Administrative Agent and when the Administrative Agent shall have received
counterparts hereof that, when taken together, bear the signatures of each of
the other parties hereto.  Delivery of an
executed counterpart of a signature page of this Agreement by telecopy or
email shall be effective as delivery of a manually executed counterpart of this
Agreement.


 


(b)                                 Electronic Execution of
Assignments.  The words “execution,”
“signed,” “signature,” and words of like import in any Assignment and
Assumption shall be deemed to include electronic signatures or the keeping of
records in electronic form, each of which shall be of the same legal effect,
validity or enforceability as a manually executed signature or the use of a
paper-based recordkeeping system, as the case may be, to the extent and as
provided for in any Requirement of Law, including the Federal Electronic
Signatures in Global and National Commerce Act, the New York State Electronic
Signatures and Records Act, or any other similar state laws based on the
Uniform Electronic Transactions Act.


 


Section 10.10                     Severability.


 


Any provision of this Agreement which is prohibited or unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective to the extent
of such prohibition or unenforceability without 


 


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invalidating the remaining provisions hereof, and any such prohibition
or unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.


 


Section 10.11                     Integration.


 


This Agreement and the other Credit Documents represent the agreement
of the Borrowers, the other Credit Parties, the Administrative Agent and the
Lenders with respect to the subject matter hereof, and there are no promises,
undertakings, representations or warranties by the Administrative Agent, the
Borrowers, the other Credit Parties, or any Lender relative to the subject
matter hereof not expressly set forth or referred to herein or therein.


 


Section 10.12                     Governing Law.


 


This Agreement shall be governed by, and construed in accordance with,
the law of the State of New York.


 


Section 10.13                     Consent to Jurisdiction;
Service of Process and Venue.


 


(a)                                  Consent to
Jurisdiction. Each of the Borrowers and each other Credit Party
irrevocably and unconditionally submits, for itself and its property, to the
nonexclusive jurisdiction of the courts of the State of New York  and any appellate court from any thereof, in any action or
proceeding arising out of or relating to this Agreement or any other Credit
Document, or for recognition or enforcement of any judgment, and each of the parties
hereto irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in such New York  sitting State court or, to the fullest extent permitted by
Requirements of Law, in such Federal court. 
Each of the parties hereto agrees 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
Requirements of Law.  Nothing in this Agreement
or in any other Credit Document shall affect any right that the Administrative
Agent or any Lender may otherwise have to bring any action or proceeding
relating to this Agreement or any other Credit Document against the Borrowers
or any other Credit Party or its properties in the courts of any jurisdiction.


 


(b)                                 Service of
Process. Each party hereto irrevocably consents to service of process in the
manner provided for notices in Section 10.2.  Nothing in this Agreement will affect the
right of any party hereto to serve process in any other manner permitted by
Requirements of Law.


 


(c)                                  Venue. The Borrowers
and each other Credit Party irrevocably and unconditionally waives, to the
fullest extent permitted by Requirements of Law, any objection that it may now
or hereafter have to the laying of venue of any action or proceeding arising
out of or relating to this Agreement or any other Credit Document in any court
referred to in paragraph (b) of this Section.  Each of the parties hereto hereby irrevocably
waives, to the fullest extent permitted by Requirements of Law, the defense of
an inconvenient forum to the maintenance of such action or proceeding in any
such court.


 


The
provisions of this Section shall survive the termination of this Agreement
and the payment in full of the Obligations.


 


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Section 10.14                     Confidentiality.


 


Each
of the Administrative Agent and the Lenders agrees to maintain the
confidentiality of the Information (as defined below), except that Information
may be disclosed (a) to its Affiliates and to its and its Affiliates’
respective partners, directors, officers, employees, agents, advisors and other
representatives (it being understood that the Persons to whom such disclosure
is made will be informed of the confidential nature of such Information and
instructed to keep such Information confidential), (b) to the extent
requested by any regulatory authority purporting to have jurisdiction over it
(including any self-regulatory authority, such as the National Association of
Insurance Commissioners), (c) to the extent required by Requirements of
Law or by any subpoena or similar legal process, (d) to any other party
hereto, (e) in connection with the exercise of any remedies hereunder,
under any other Credit Document or any action or proceeding relating to this
Agreement, any other Credit Document or the enforcement of rights hereunder or
thereunder, (f) subject to an agreement containing provisions
substantially the same as those of this Section, to any assignee of or
Participant in, or any prospective assignee of or Participant in, any of its
rights or obligations under this Agreement and/or the other Credit Documents, (g) (i) any
actual or prospective counterparty (or its advisors) to any swap or derivative
transaction relating to the Credit Parties and their obligations, (ii) an
investor or prospective investor in securities issued by an Approved Fund that
also agrees that Information shall be used solely for the purpose of evaluating
an investment in such securities issued by the Approved Fund, (iii) a
trustee, collateral manager, custodian, servicer, backup servicer, noteholder
or secured party in connection with the administration, servicing and reporting
on the assets serving as collateral for securities issued by an Approved Fund,
or (iv) a nationally recognized rating agency that requires access to
information regarding the Credit Parties, the Loans and Credit Documents in
connection with ratings issued in respect of securities issued by an Approved
Fund (in each case, it being understood that the Persons to whom such
disclosure is made will be informed of the confidential nature of such
information and instructed to keep such information confidential), (h) with the consent of the
applicable Credit Parties or (i) to the extent such Information (x) becomes
publicly available other than as a result of a breach of this Section or (y) becomes
available to the Administrative Agent, any Lender, or any of their respective
Affiliates on a nonconfidential basis from a source other than the Credit
Parties.


 


For
purposes of this Section, “Information” means all information received
from the Credit Parties or any of their Subsidiaries relating to the Credit
Parties or any of their Subsidiaries or any of their respective businesses,
other than any such information that is available to the Administrative Agent
or any Lender on a nonconfidential basis prior to disclosure by the Credit
Parties or any of their Subsidiaries, provided that, in the case of information
received from the Credit Parties or any of their Subsidiaries after the date
hereof, such information is clearly identified at the time of delivery as
confidential.  Any Person required to
maintain the confidentiality of Information as provided in this Section shall
be considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such
Information as such Person would accord to its own confidential information.


 


Notwithstanding
anything to the contrary contained herein or in any Credit Document, the Credit
Parties shall be entitled to disclose any and all terms of any Credit Document
(including the public filing thereof) if any Credit Party, in its sole
discretion, deems it necessary or appropriate under the rules or
regulations of the SEC and/or the New York Stock Exchange.


 


The
provisions of this Section shall survive the termination of this Agreement
and the payment in full of the Obligations.


 


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Section 10.15                     Acknowledgments.


 


The Borrowers and the other
Credit Parties each hereby acknowledge that:


 


(a)                                  it has been
advised by counsel in the negotiation, execution and delivery of each Credit
Document;


 


(b)                                 neither the
Administrative Agent nor any Lender has any fiduciary relationship with or duty
to the Borrowers or any other Credit Party arising out of or in connection with
this Agreement and the relationship between the Administrative Agent and the
Lenders, on one hand, and the Borrowers and the other Credit Parties, on the
other hand, in connection herewith is solely that of debtor and creditor; and


 


(c)                                  no joint
venture exists among the Lenders or among the Borrowers or the other Credit
Parties, the Lenders and the Administrative Agent.


 


Section 10.16                     Waivers of Jury Trial.


 


EACH
PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
REQUIREMENTS OF LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL
PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT
OR ANY OTHER CREDIT DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY
(WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT
IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT
AND THE OTHER CREDIT DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.


 


The
provisions of this Section shall survive the termination of this Agreement
and the payment in full of the Obligations.


 


Section 10.17                     Patriot Act Notice.


 


Each
Lender and the Administrative Agent (for itself and not on behalf of any other
party) hereby notifies the Borrowers that, pursuant to the requirements of the
Patriot Act, it is required to obtain, verify and record information that identifies
the Borrowers and the other Credit Parties, which information includes the name
and address of the Borrowers and the other Credit Parties and other information
that will allow such Lender or the Administrative Agent, as applicable, to
identify the Borrowers and the other Credit Parties in accordance with the
Patriot Act.


 


Section 10.18                     Resolution of Drafting
Ambiguities.


 


Each
Credit Party acknowledges and agrees that it was represented by counsel in connection
with the execution and delivery of this Agreement and the other Credit
Documents to which it is a party, that it and its counsel reviewed and
participated in the preparation and negotiation hereof and thereof and that any
rule of construction to the effect that ambiguities are to be resolved against
the drafting party shall not be employed in the interpretation hereof or
thereof.


 


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Section 10.19                     Continuing Agreement.


 


This
Credit Agreement shall be a continuing agreement and shall remain in full force
and effect until all Loans, interest, fees and other Obligations (other than
those obligations that expressly survive the termination of this Credit
Agreement) have been paid in full and all Commitments have been terminated.  Upon termination, the Credit Parties shall
have no further obligations (other than those obligations that expressly
survive the termination of this Credit Agreement) under the Credit Documents
and the Administrative Agent shall, at the request and expense of the
Borrowers, deliver all the Collateral in its possession to the Borrowers and
release all Liens on the Collateral; provided that should any payment,
in whole or in part, of the Obligations be rescinded or otherwise required to
be restored or returned by the Administrative Agent or any Lender, whether as a
result of any proceedings in bankruptcy or reorganization or otherwise, then
the Credit Documents shall automatically be reinstated and all Liens of the
Administrative Agent shall reattach to the Collateral and all amounts required
to be restored or returned and all costs and expenses incurred by the
Administrative Agent or any Lender in connection therewith shall be deemed
included as part of the Obligations.


 


Section 10.20                     Lender Consent.


 


Each
Person signing a Lender Consent (a) approves of this Agreement and the
other Credit Documents, (b) authorizes and appoints the Administrative
Agent as its agent in accordance with the terms of Article VIII, (c) authorizes
the Administrative Agent to execute and deliver this Agreement on its behalf,
and (d) is a Lender hereunder and therefore shall have all the rights and
obligations of a Lender under this Agreement as if such Person had directly
executed and delivered a signature page to this Agreement.


 


Section 10.21                     Appointment of the
Administrative Borrower.


 


Each
of the Borrowers hereby appoint the Administrative Borrower to act as its agent
for all purposes under this Agreement (including, without limitation, with
respect to all matters related to the borrowing and repayment of Loans) and
agree that (a) the Administrative Borrower may execute such documents on
behalf of such Borrower as the Administrative Borrower deems appropriate in its
sole discretion and each Borrower shall be obligated by all of the terms of any
such document executed on its behalf, (b) any notice or communication
delivered by the Administrative Agent or the Lender to the Administrative
Borrower shall be deemed delivered to each Borrower and (c) the
Administrative Agent or the Lenders may accept, and be permitted to rely on,
any document, instrument or agreement executed by the Administrative Borrower
on behalf of each Borrower.


 


Section 10.22                     Counterclaims.


 


The
Credit Parties each hereby knowingly, voluntarily and intentionally waives any
right to assert a counterclaim, other than a compulsory counterclaim, in any
action or proceeding brought against it by the Administrative Agent, the
Lenders or any of the Affiliates or agents of the foregoing.  The provisions of this Section shall
survive the termination of this Agreement and the payment in full of the
Obligations.


 


Section 10.23                     Legal Matters.


 


In
the event of any conflict between the terms of this Agreement, any other Credit
Document or any Confirmation with respect to any Collateral, the documents
shall control in the following order of priority:  first, the terms of the related Confirmation
shall prevail, then the terms of this Agreement shall prevail, and then the
terms of the other Credit Documents shall prevail.


 


127

















 


Section 10.24                     Recourse Against Certain
Parties.


 


No
recourse under or with respect to any obligation, covenant or agreement
(including, without limitation, the payment of any fees or any other
obligations) of the Administrative Agent, the Lenders, or the Credit Parties,
as contained in this Agreement, the Credit Documents or any other agreement,
instrument or document entered into by the Administrative Agent, the Lenders,
the Credit Parties or any such party pursuant hereto or thereto or in connection
herewith or therewith shall be had against any administrator of the
Administrative Agent, the Lenders, or the Credit Parties or any incorporator,
Affiliate (direct or indirect), owner, member, partner, stockholder, officer,
director, employee, agent or attorney of the Administrative Agent, the Lenders,
or the Credit Parties or of any such administrator, as such, by the enforcement
of any assessment or by any legal or equitable proceeding, by virtue of any
statute or otherwise; it being expressly agreed and
understood that the agreements of the Administrative Agent, the
Lenders or the Credit Parties contained in this Agreement, the Credit Documents
and all of the other agreements, instruments and documents entered into by it
pursuant hereto or thereto or in connection herewith or therewith are, in each
case, solely the corporate obligations of the Administrative Agent, the Lenders
or the Credit Parties and that no personal liability whatsoever shall attach to
or be incurred by any administrator of the Administrative Agent, the Lenders or
the Credit Parties or any incorporator, owner, member, partner, stockholder,
Affiliate (direct or indirect), officer, director, employee, agent or attorney
of the Administrative Agent, the Lenders or the Credit Parties or of any such
administrator, as such, or any other of them, under or by reason of any of the
obligations, covenants or agreements of the Administrative Agent, the Lenders
or the Credit Parties contained in this Agreement, the Credit Documents or in
any other such instruments, documents or agreements, or that are implied
therefrom, and that any and all personal liability of every such administrator
of the Administrative Agent, the Lenders or the Credit Parties and each
incorporator, owner, member, partner, stockholder, Affiliate (direct or
indirect), officer, director, employee, agent or attorney of the Administrative
Agent, the Lenders, the Credit Parties or of any such administrator, or any of
them, for breaches by the Administrative Agent, the Lenders, or the Credit
Parties of any such obligations, covenants or agreements, which liability may
arise either at common law or at equity, by statute or constitution, or
otherwise, is hereby expressly waived as a condition of and in consideration
for the execution of this Agreement.  The
provisions of this Section shall survive the termination of this Agreement
and the payment in full of the Obligations.


 


Section 10.25                     Protection of Right, Title
and Interest in the Collateral; Further Action Evidencing Loans.


 


(a)                                  The Credit Parties shall
cause all financing statements and continuation statements and any other
necessary documents covering the right, title and interest of the
Administrative Agent to the Collateral to be promptly recorded, registered and
filed, and at all times to be kept recorded, registered and filed, all in such
manner and in such places as may be required by Requirements of Law fully to
preserve and protect the right, title and interest of the Administrative Agent
(on behalf of the Lenders) hereunder to all Property comprising the
Collateral.  The Credit Parties shall
deliver to the Administrative Agent file-stamped copies of, or filing receipts
for, any document recorded, registered or filed as provided above, as soon as
available following such recording, registration or filing.  The Credit Parties shall execute any and all
documents reasonably required to fulfill the intent of this Section.


 


(b)                                 The Credit Parties agree
that from time to time, at their expense, they will promptly execute and deliver
all instruments and documents, and take all actions, that the Administrative
Agent or any Lender may reasonably request in order to perfect, protect or more
fully evidence the Loans hereunder and the security interest granted in the
Collateral, or to enable the Administrative Agent to exercise and enforce their
rights and remedies hereunder or under any Credit Document.


 


128














 


(c)                                  If the Credit Parties fail
to perform any of their obligations hereunder, the Administrative Agent may
(but shall not be required to) perform, or cause performance of, such
obligation; and the Administrative Agent’s reasonable costs and expenses incurred
in connection therewith shall be payable by the Borrowers.  The Credit Parties irrevocably appoint the
Administrative Agent as their attorney-in-fact and authorize the Administrative
Agent to act on behalf of the Credit Parties (i) to execute on behalf of
the Credit Parties as debtor and to file financing statements necessary or
desirable in the Administrative Agent’s discretion to perfect and to maintain
the perfection and priority of the interest in the Collateral, and (ii) to
file a carbon, photographic or other reproduction of this Agreement or any
financing statement with respect to the Collateral as a financing statement in
such offices as the Administrative Agent in its discretion deems necessary or
desirable to perfect and to maintain the perfection and priority of the
interests in the Collateral.  This
appointment is coupled with an interest and is irrevocable.


 


Section 10.26                     Credit Parties’ Waiver of
Setoff.


 


Each
Credit Party hereby waives any right of setoff it may have or to which it may
be entitled under this Agreement, the other Credit Documents or otherwise from
time to time against the Administrative Agent, any Lender, or any Property or
assets, or any of the foregoing.


 


Section 10.27                     Periodic Due Diligence
Review.


 


Each
Credit Party acknowledges that the Administrative Agent and each Lender has the
right to perform continuing due diligence reviews with respect to the
Collateral and the Credit Parties and Consolidated Subsidiaries of the
foregoing for purposes of verifying compliance with the representations,
warranties, covenants, agreements and specifications made hereunder, or
otherwise, and each Credit Party agrees that upon reasonable (but no less than
three (3) Business Day) prior notice, unless an Event of Default shall
have occurred, in which case no notice is required, to the Credit Parties, as
applicable, the Administrative Agent, the Lenders or their authorized
representatives shall be permitted during normal business hours to examine,
inspect, and make copies and extracts of, the Collateral and any and all
documents, records, agreements, instruments or information relating to such
Collateral, the Credit Parties and the Consolidated Subsidiaries of the
foregoing in the possession or under the control of any Credit Party.  Each Credit Party also shall make available
to the Administrative Agent a knowledgeable financial or accounting officer for
the purpose of answering questions respecting the Collateral, the Credit
Parties and the Consolidated Subsidiaries of the foregoing.  Each Credit Party shall also make available
to the Administrative Agent and the Lenders any accountants or auditors of any
Credit Party to answer any questions or provide any documents as the
Administrative Agent or the Lenders may require.  The Borrowers shall pay all reasonable
out-of-pocket costs and expenses incurred by the Administrative Agent and/or
the Lenders in connection with the Administrative Agent’s and the Lenders’
activities pursuant to this Section  (“Due Diligence Costs”).  The Credit Parties acknowledge that the
Administrative Agent has the right at any time to review all aspects of the
Collateral and the Asset Value thereof, which review shall occur no less than
quarterly and such reviews may result in mandatory prepayments under Section 2.5.


 


Section 10.28                     Character of Loans for
Income Tax Purposes.


 


The
Lenders and the Borrowers shall treat all Loans hereunder as indebtedness of
the Borrowers for United States federal income tax purposes.


 


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Section 10.29                     Joint and Several Liability;
Full Recourse Obligations.


 


(a)                                  At all times during which
there is more than one (1) Borrower under this Agreement, each
Borrower hereby acknowledges and agrees that (i) such Borrower shall be
jointly and severally liable to the Administrative Agent and the Lenders to the
maximum extent permitted by the Requirements of Law for all representations,
warranties, covenants, duties and indemnities of the Borrowers, arising under
this Agreement and the other Credit Documents, as applicable, and the
Obligations, (ii) such Borrower has consented to the Administrative
Borrower delivering all Notices of Borrowing on behalf of all Borrowers and any
such Notice of Borrowing delivered by the Administrative Borrower on behalf of
the Borrowers is binding upon and enforceable against each Borrower, (iii) the
liability of each Borrower (A) shall be absolute and unconditional and
shall remain in full force and effect (or be reinstated) until all the
Obligations shall have been paid in full and the expiration of any applicable
preference or similar period pursuant to any bankruptcy, insolvency,
reorganization, moratorium or similar law, or at law or in equity, without any
claim having been made before the expiration of such period asserting an
interest in all or any part of any payment(s) received by the
Administrative Agent, and (B) until such payment has been made, shall not
be discharged, affected, modified or impaired on the happening from time to
time of any event, including, without limitation, any of the following, whether
or not with notice to or the consent of the Credit Parties or any other Person,
(1) the waiver, compromise, settlement, release, termination or amendment
(including, without limitation, any extension or postponement of the time for
payment or performance or renewal or refinancing) of any or all of the
obligations or agreements of any Credit Party under this Agreement or any
Credit Document, (2) the failure to give notice to the Credit Parties of
the occurrence of an Event of Default under any of the Credit Documents, (3) the
release, substitution or exchange by the Administrative Agent of any or all of
the Collateral (whether with or without consideration) or the acceptance by the
Administrative Agent of any additional collateral or the availability or
claimed availability of any other collateral or source of repayment or any
nonperfection or other impairment of collateral, (4) the release of any
Person primarily or secondarily liable for all or any part of the Obligations,
whether by the Administrative Agent or in connection with any voluntary or
involuntary liquidation, dissolution, receivership, insolvency, bankruptcy,
assignment for the benefit of creditors or similar event or proceeding
affecting any or all of the Credit Parties or any other Person who, or any of
whose Property, shall at the time in question be obligated in respect of the
Obligations or any part thereof, or (5) to the extent permitted by
Requirements of Law, any other event, occurrence, action or circumstance that
would, in the absence of this Section, result in the release or discharge of
any or all of the Borrowers from the performance or observance of any
obligation, covenant or agreement contained in this Agreement or the Credit
Documents, (iv) the Administrative Agent shall not be required first to
initiate any suit or to exhaust its remedies against the Credit Parties or any
other Person to become liable, or against any of the Collateral, in order to
enforce this Agreement or the Credit Documents and the Credit Parties expressly
agree that, notwithstanding the occurrence of any of the foregoing, each
Borrower shall be and remain directly and primarily liable for all sums due
under this Agreement or any of the other Credit Documents, (v) when making
any demand hereunder against any Borrower, the Administrative Agent or the
Lenders may, but shall be under no obligation to, make a similar demand on the
other Borrowers, and any failure by the Administrative Agent or Lenders to make
any such demand or to collect any payments from the other Borrowers, or any
release of such other Borrowers, shall not relieve any Borrower in respect of
which a demand or collection is not made or the Borrowers not so released of
their obligations or liabilities hereunder, and shall not impair or affect the
rights and remedies, express or implied, or as a matter of law, of the
Administrative Agent or the Lenders against the Borrowers and (vi) on
disposition by the Administrative Agent of any Property encumbered by any Collateral,
each Borrower shall be and shall remain jointly and severally liable for any
deficiency.


 


130

















 


(b)                                 Each Borrower hereby agrees
that, to the extent another Borrower shall have paid more than its proportionate
share of any payment made hereunder, the Borrowers shall be entitled to seek
and receive contribution from and against any other Borrowers which have not
paid their proportionate share of such payment; provided  however,
that the provisions of this Section shall in no respect limit the
obligations and liabilities of each Borrower to the Administrative Agent and
the Lenders and, notwithstanding any payment or payments made by a Borrower
(the “paying Borrower”) hereunder or any set-off or application of funds
of the paying Borrower by the Administrative Agent or the Lenders, the paying
Borrower shall not be entitled to be subrogated to any of the rights of the
Administrative Agent or the Lenders against any other Borrowers or any
collateral security or guarantee or right of offset held by the Administrative
Agent or the Lenders, nor shall the paying Borrower seek or be entitled to seek
any contribution or reimbursement from the other Borrowers in respect of
payments made by the paying Borrower hereunder, until all amounts owing to the
Administrative Agent and the Lenders by the Borrowers under the Credit
Documents and the Obligations (but only to the extent that an event of default,
an event that, with the notice or the lapse of time, would become an event of
default, or any acceleration has occurred with respect to such other
Obligations) are paid in full.  If any
amount shall be paid to the paying Borrower on account of such subrogation
rights at any time when all such amounts shall not have been paid in full, such
amount shall be held by the paying Borrower in trust for the Administrative
Agent, segregated from other funds of the paying Borrower, and shall, forthwith
upon receipt by the paying Borrower, be turned over to the Administrative Agent
in the exact form received by the paying Borrower (duly indorsed by the paying
Borrower to the Administrative Agent, if required), to be applied against
amounts owing to the Administrative Agent and the Lenders by the Borrowers
under the Credit Documents and the Obligations (but only to the extent that an
event of default, an event that, with the notice or the lapse of time, would
become an event of default, or any acceleration has occurred with respect to
such other Obligations) in such order as the Administrative Agent may determine
in its discretion.


 


(c)                                  The obligations of the
Borrowers under the Credit Documents are full recourse obligations to each
Borrower and the Borrowers hereby forever waive, demise, acquit and discharge
any and all defenses, and shall at no time assert or allege any defense, to the
contrary.


 


Section 10.30                     Amendment and Restatement.


 


This
Agreement amends, restates and supersedes in its entirety the Original
Agreement.  Notwithstanding the amendment
and restatement of the Original Agreement by this Agreement:  (a) unless modified by the express terms
of this Agreement, the other Credit Documents or the Confirmations delivered in
connection with this Agreement, each Loan outstanding on the date hereof under
the Original Agreement shall continue in effect as a Loan hereunder, without
any transfer, conveyance, diminution, forbearance, forgiveness or other
modification thereto or effect thereon occurring or being deemed to occur by
reason of the amendment and restatement of the Original Agreement hereby and (b) the
Borrowers shall continue to be liable to the Lenders for (i) all “Obligations”
(under and as defined in the Original Agreement) accrued to the date hereof
under the Original Agreement and (ii) all agreements on the part of the
Borrowers under the Original Agreement to indemnify the Lenders or any Secured
Party in connection with events or conditions arising or existing prior to the
effective date of this Agreement, including, but not limited to, those events
and conditions set forth in Section 10.5 thereof.  This Agreement is given in substitution for
the Original Agreement and not as payment of any of the obligations of the
Borrowers thereunder, and is in no way intended to constitute a novation of the
Original Agreement.  Nothing contained
herein is intended to amend, modify or otherwise affect any obligation of the
Borrowers, the Guarantor or the Pledgor existing prior to the date hereof.  Upon the effectiveness of this Agreement,
each reference to the Original Agreement in any other Credit Document, or
document, instrument or agreement executed and/or delivered in connection 


 


131

















 


therewith,
shall mean and be a reference to this Agreement unless the context otherwise
requires.  Upon the effectiveness of this
Agreement, the terms of this Agreement shall govern all aspects of the facility
represented by the Original Agreement, including, without limitation, the
eligibility of Collateral financed under the Original Agreement and any settlements
to be made with respect thereto. All costs and fees accrued with respect to the
Original Agreement have been paid in full.


 


Section 10.31                     Modification of Other Credit
Documents.


 


The
amendments and modifications to this Agreement shall amend and modify the other
Credit Documents to the extent such other Credit Documents are not separately
amended or modified on the Restatement Date. 
The Credit Parties agree that all other Credit Documents that are not
separately amended or modified on the Restatement Date are binding and
enforceable obligations and are in full force and effect, as modified and
amended by this Agreement.


 


Section 10.32                     Accredited Investor
Representations.


 


(a)                                         Wachovia
understands that neither the Warrants nor the Warrant Shares (as defined in the
Warrant) have been, and will not be registered, under the Securities Act.  Wachovia also understands that the Warrants
and Warrant Shares are being offered and sold pursuant to an exemption from
registration contained in the Securities Act based in part upon Wachovia’s
representations contained in this Section 10.32.  Wachovia further acknowledges, agrees and
understands that neither the Warrants nor Warrant Shares may be offered or sold
within the United States or to, or for the account or benefit of a U.S. Person
within the meaning of Regulation S promulgated under the Securities Act, except
in accordance with Regulation S or pursuant to a duly available exemption from
the registration requirements of the Securities Act, unless the Warrants and
Warrant Shares are subsequently registered under the Securities Act.  Wachovia acknowledges and agrees that
Northstar Corp has no obligation or intention to register the Warrants or
Warrant Shares under the Securities Act. 
Wachovia acknowledges and agrees that it is solely responsible for
obtaining such legal, including tax, advice as it considers necessary and
appropriate in connection with the investment by it in the Warrants and Warrant
Shares.


 


(b)                Wachovia hereby
represents, warrants and undertakes as follows:


 


(i)                                     Wachovia is a
highly sophisticated investor and has substantial experience in evaluating and
investing in private placement transactions of securities in companies similar
to Northstar Corp so that it is capable of evaluating, and has independently
evaluated, the merits and risks of its investment in Northstar Corp and has the
capacity to protect its own interests. 
Wachovia may be required to bear the economic risk of this investment
indefinitely and has independently concluded that it is financially able to
bear those risks indefinitely.  Wachovia
understands that Northstar Corp has no obligation or present intention of
registering the Warrants or Warrant Shares in the United States pursuant to the
Securities Act.


 


(ii)                                  Wachovia is
acquiring the Warrants and Warrant Shares for Wachovia’s own account for
investment only, and not with a view towards their distribution or resale.  Wachovia has not acquired the Warrants or
Warrant Shares for the purpose of selling or transferring them, or granting,
issuing or transferring interests in, or options over, them.


 


(iii)                               Wachovia
represents that by reason of its, or of its management’s, business or financial
experience, Wachovia has the capacity to protect its own interests in 


 


132

















 


connection
with the transactions contemplated in the Warrants.  Further, Wachovia is not aware of any general
solicitation or publication of any advertisement, as such terms are defined in
Regulation D under the Securities Act, in connection with the acquisition of
the Warrants and Warrant Shares.


 


(iv)                               Wachovia is an
accredited investor, within the meaning of Regulation D under the Securities
Act.


 


(v)                                 Wachovia is
aware of Northstar Corp’s business affairs and financial condition and has
acquired sufficient information about Northstar Corp, including publicly
available information concerning Northstar Corp, to reach an informed and
knowledgeable decision to acquire the Warrants and Warrant Shares.  Wachovia has had an opportunity to discuss
Northstar Corp’s business, management and financial affairs with directors,
officers and management of Northstar Corp. 
Wachovia has also had the opportunity to ask questions of and receive
answers from, Northstar Corp and its management regarding the terms and
conditions of the purchase.  Wachovia has
not been provided with, nor has it requested, an offering memorandum or similar
document in connection with its decision to acquire the Warrants and Warrant
Shares.


 


(vi)                              Wachovia
acknowledges and agrees that the Warrants and Warrant Shares are “restricted
securities” as defined in Rule 144 promulgated under the Securities Act as
in effect from time to time and understands that neither Northstar Corp, nor
any of its affiliates, or any person acting on its behalf makes any
representation as to the availability of Rule 144 or any other exemption
under the Securities Act for the reoffer, resale, pledge or transfer of the
Warrants or Warrant Shares.


 


(vii)                           Wachovia
acknowledges and agrees that the Warrants and the Warrant Shares are subject to
the restrictions on transfer as set forth in Section 7 of the Warrants and
agrees to comply with such restrictions.


 


[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]


 


133

















 


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


 


	
  BORROWERS:

  	
  NRFC
  WA HOLDINGS, LLC, a Delaware limited liability company

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Daniel R. Gilbert

  
	
   

  	
  Name:

  	
  Daniel
  R. Gilbert

  
	
   

  	
  Title:

  	
  Executive
  Vice President

  
	
   

  	
   

  	
  and
  Chief Investment Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  NRFC
  WA HOLDINGS II, LLC, a Delaware limited liability company

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Daniel R. Gilbert

  
	
   

  	
  Name:

  	
  Daniel
  R. Gilbert

  
	
   

  	
  Title:

  	
  Executive
  Vice President

  
	
   

  	
   

  	
  and
  Chief Investment Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  NRFC
  WA HOLDINGS VII, LLC, a Delaware limited liability company

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Daniel R. Gilbert

  
	
   

  	
  Name:

  	
  Daniel
  R. Gilbert

  
	
   

  	
  Title:

  	
  Executive
  Vice President

  
	
   

  	
   

  	
  and
  Chief Investment Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  NRFC
  WA HOLDINGS X, LLC, a Delaware limited liability company

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Daniel R. Gilbert

  
	
   

  	
  Name:

  	
  Daniel
  R. Gilbert

  
	
   

  	
  Title:

  	
  Executive
  Vice President

  
	
   

  	
   

  	
  and
  Chief Investment Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  NRFC
  WA HOLDINGS XII, LLC, a Delaware limited liability company

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Daniel R. Gilbert

  
	
   

  	
  Name:

  	
  Daniel
  R. Gilbert

  
	
   

  	
  Title:

  	
  Executive
  Vice President

  
	
   

  	
   

  	
  and
  Chief Investment Officer

  



 


S-1

















 


	
  GUARANTORS:

  	
  NORTHSTAR
  REALTY FINANCE CORP.,

  
	
   

  	
  a
  Maryland  corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Daniel R. Gilbert

  
	
   

  	
  Name:

  	
  Daniel
  R. Gilbert

  
	
   

  	
  Title:

  	
  Executive
  Vice President 

  
	
   

  	
   

  	
  and
  Chief Investment Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  NORTHSTAR
  REALTY FINANCE L.P.,

  
	
   

  	
  a
  Delaware limited partnership

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Daniel R. Gilbert

  
	
   

  	
  Name:

  	
  Daniel
  R. Gilbert

  
	
   

  	
  Title:

  	
  Executive
  Vice President 

  
	
   

  	
   

  	
  and
  Chief Investment Officer

  



 


S-2

















 


	
  ADMINISTRATIVE
  AGENT:

  	
  WACHOVIA
  BANK, NATIONAL

  
	
   

  	
  ASSOCIATION, as
  Administrative Agent on behalf of the Lenders

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  H. Lee Goins III

  
	
   

  	
  Name:

  	
  H.
  Lee Goins III

  
	
   

  	
  Title:

  	
  Director

  



 


S-3