exv10w47



 






Exhibit 10.47




	 	 	 
	

	 	Master Repurchase
Agreement






September 1996 Version




Dated as of: DECEMBER 8, 2005




Between: BEAR, STEARNS & CO. INC.




And: CSE MORTGAGE LLC





	1.	 	Applicability
	 
	 	 	From time to time the parties hereto may enter into transactions in which one party
(“Seller”)
agrees to transfer to the other (“Buyer”) securities or other assets (“Securities”) against
the transfer
of funds by Buyer, with a simultaneous agreement by Buyer to transfer to Seller such
Securities at a
date certain or on demand, against the transfer of funds by Seller. Each such transaction
shall be
referred to herein as a “Transaction” and, unless otherwise agreed in writing, shall be
governed by
this Agreement, including any supplemental terms or conditions contained in Annex I hereto and
in any other annexes identified herein or therein as applicable hereunder.
	 
	2.	 	Definitions






	 	(a)	 	“Act of Insolvency”, with respect to any party, (i) the commencement by such
party as debtor of
any case or proceeding under any bankruptcy, insolvency, reorganization, liquidation,
moratori-um, dissolution, delinquency or similar law, or such party seeking the appointment
or election
of a receiver, conservator, trustee, custodian or similar official for such party or any
substantial
part of its property, or the convening of any meeting of creditors for purposes of commencing
any such case or proceeding or seeking such an appointment or election, (ii) the commencement of any such case or proceeding against such party, or another seeking such an appointment or election, or the filing against a party of an application for a protective decree
under the
provisions of the Securities Investor Protection Act of 1970, which (A) is consented to or not
timely contested by such party, (B) results in the entry of an order for relief, such an
appoint-ment or election, the issuance of such a protective decree or the entry of an order
having a similar effect, or (C) is not dismissed within 15 days, (iii) the making by such
party of a general
assignment for the benefit of creditors, or (iv) the admission in writing by such party of
such
party’s inability to pay such party’s debts as they become due;
	 
	 	(b)	 	“Additional Purchased Securities”, Securities provided by Seller to Buyer pursuant to
Paragraph
4(a) hereof;
	 
	 	(c)	 	“Buyer’s Margin Amount”, with respect to any Transaction as of any date, the amount
obtained by application of the Buyer’s Margin Percentage to the Repurchase Price for
such Transaction as of such date;




 









 












	 	(d)	 	“Buyer’s Margin Percentage”, with respect to any Transaction as of any date, a percentage
(which may be equal to the Seller’s Margin Percentage) agreed to by Buyer and Seller or,
in the absence of any such agreement, the percentage obtained by dividing the Market
Value of the Purchased Securities on the Purchase Date by the Purchase Price on the
Purchase Date for such Transaction;
	 
	 	(e)	 	“Confirmation”, the meaning specified in Paragraph 3(b) hereof;
	 
	 	(f)	 	“Income”, with respect to any Security at any time, any principal thereof and all
interest,
dividends or other distributions thereon;
	 
	 	(g)	 	“Margin Deficit”, the meaning specified in Paragraph 4(a) hereof;
	 
	 	(h)	 	“Margin Excess”, the meaning specified in Paragraph 4(b) hereof;
	 
	 	(i)	 	“Margin Notice Deadline”, the time agreed to by the parties in the relevant Confirmation,
Annex I hereto or otherwise as the deadline for giving notice requiring same-day satisfaction of margin maintenance obligations as provided in Paragraph 4 hereof (or, in the
absence of any such agreement, the deadline for such purposes established in accordance
with market practice);
	 
	 	(j)	 	“Market Value”, with respect to any Securities as of any date, the price for such
Securities
on such date obtained from a generally recognized source agreed to by the parties or the
most recent closing bid quotation from such a source, plus accrued Income to the exten
not included therein (other than any Income credited or transferred to, or applied to the
obligations of, Seller pursuant to Paragraph 5 hereof ) as of such date (unless contrary to
market practice for such Securities);
	 
	 	(k)	 	“Price Differential”, with respect to any Transaction as of any date, the aggregate amount
obtained by daily application of the Pricing Rate for such Transaction to the Purchase
Price for such Transaction on a 360 day per year basis for the actual number of days during the period commencing on (and including) the Purchase Date for such Transaction
and ending on (but excluding) the date of determination (reduced by any amount of
such Price Differential previously paid by Seller to Buyer with respect to such
Transaction);
	 
	 	(l)	 	“Pricing Rate”, the per annum percentage rate for determination of the Price Differential;
	 
	 	(m)	 	“Prime Rate”, the prime rate of U.S. commercial banks as published in The Wall Street
Journal (or, if more than one such rate is published, the average of such rates);
	 
	 	(n)	 	“Purchase Date”, the date on which Purchased Securities are to be transferred by Seller to
Buyer;
	 
	 	(o)	 	“Purchase Price”, (i) on the Purchase Date, the price at which Purchased Securities are
transferred by Seller to Buyer, and (ii) thereafter, except where Buyer and Seller agree otherwise, such price increased by the amount of any cash transferred by Buyer to Seller pursuant to Paragraph 4(b) hereof and decreased by the amount of any cash transferred by
Seller to Buyer pursuant to Paragraph 4(a) hereof or applied to reduce Seller’s obligations
under clause (ii) of Paragraph 5 hereof;




 









 






	 	(p)	 	“Purchased Securities”, the Securities transferred by Seller to Buyer in a Transaction
hereunder, and any Securities substituted therefor in accordance with Paragraph 9 hereof. The
term “Purchased Securities” with respect to any Transaction at any time also shall include
Additional Purchased Securities delivered pursuant to Paragraph 4(a) hereof and shall
exclude Securities returned pursuant to Paragraph 4(b) hereof;
	 
	 	(q)	 	“Repurchase Date”, the date on which Seller is to repurchase the Purchased Securities
from Buyer, including any date determined by application of the provisions of Paragraph
3(c) or 11 hereof;
	 
	 	(r)	 	“Repurchase Price”, the price at which Purchased Securities are to be transferred from
Buyer to Seller upon termination of a Transaction, which will be determined in each case
(including Transactions terminable upon demand) as the sum of the Purchase Price and
the Price Differential as of the date of such determination;
	 
	 	(s)	 	“Seller’s Margin Amount”, with respect to any Transaction as of any date, the amount
obtained by application of the Seller’s Margin Percentage to the Repurchase Price for
such Transaction as of such date;
	 
	 	(t)	 	“Seller’s Margin Percentage”, with respect to any Transaction as of any date, a percentage
(which may be equal to the Buyer’s Margin Percentage) agreed to by Buyer and Seller or,
in the absence of any such agreement, the percentage obtained by dividing the Market
Value of the Purchased Securities on the Purchase Date by the Purchase Price on the
Purchase Date for such Transaction.






	3.	 	Initiation; Confirmation; Termination






	 	(a)	 	An agreement to enter into a Transaction may be made orally or in writing at
the initiation of either Buyer or Seller. On the Purchase Date for the Transaction, the Purchased
Securities shall be transferred to Buyer or its agent against the transfer of the Purchase
Price to an account of Seller.
	 
	 	(b)	 	Upon agreeing to enter into a Transaction hereunder, Buyer or Seller (or both), as shall
be agreed, shall promptly deliver to the other party a written confirmation of each
Transaction (a “Confirmation”). The Confirmation shall describe the Purchased
Securities (including CUSIP number, if any), identify Buyer and Seller and set forth (i)
the Purchase Date, (ii) the Purchase Price, (iii) the Repurchase Date, unless the
Transaction is to be terminable on demand, (iv) the Pricing Rate or Repurchase Price
applicable to the Transaction, and (v) any additional terms or conditions of the
Transaction not inconsistent with this Agreement. The Confirmation, together with this
Agreement, shall constitute conclusive evidence of the terms agreed between Buyer and
Seller with respect to the Transaction to which the Confirmation relates, unless with
respect to the Confirmation specific objection is made promptly after receipt thereof. In
the event of any conflict between the terms of such Confirmation and this Agreement
this Agreement shall prevail.
	 
	 	(c)	 	In the case of Transactions terminable upon demand, such demand shall be made by
Buyer or Seller, no later than such time as is customary in accordance with market practice, by telephone or otherwise on or prior to the business day on which such termination
will be effective. On the date specified in such demand, or on the date fixed for termina-
tion in the case of Transactions having a fixed term, termination of the Transaction will




 









 






	 	 	 	be effected by transfer to Seller or its agent of the Purchased Securities and any Income in
respect thereof received by Buyer (and not previously credited or transferred to, or
applied to the obligations of, Seller pursuant to Paragraph 5 hereof ) against the transfer
of the Repurchase Price to an account of Buyer.








	4.	 	Margin Maintenance






	 	(a)	 	If at any time the aggregate Market Value of all Purchased Securities subject
to all
Transactions in which a particular party hereto is acting as Buyer is less than the aggregate Buyer’s Margin Amount for all such Transactions (a “Margin Deficit”), then Buyer
may by notice to Seller require Seller in such Transactions, at Seller’s option, to transfer
to
Buyer cash or additional Securities reasonably acceptable to Buyer (“Additional
Purchased Securities”), so that the cash and aggregate Market Value of the Purchased
Securities, including any such Additional Purchased Securities, will thereupon equal or
exceed such aggregate Buyer’s Margin Amount (decreased by the amount of any Margin
Deficit as of such date arising from any Transactions in which such Buyer is acting as
Seller).
	 
	 	(b)	 	If at any time the aggregate Market Value of all Purchased Securities subject to all
Transactions in which a particular party hereto is acting as Seller exceeds the aggregate
Seller’s Margin Amount for all such Transactions at such time (a “Margin Excess”), then
Seller may by notice to Buyer require Buyer in such Transactions, at Buyer’s option, to
transfer cash or Purchased Securities to Seller, so that the aggregate Market Value of the
Purchased Securities, after deduction of any such cash or any Purchased Securities so
transferred, will thereupon not exceed such aggregate Seller’s Margin Amount (increased
by the amount of any Margin Excess as of such date arising from any Transactions in
which such Seller is acting as Buyer).
	 
	 	(c)	 	If any notice is given by Buyer or Seller under subparagraph (a) or (b) of this Paragraph
at or before the Margin Notice Deadline on any business day, the party receiving such
notice shall transfer cash or Additional Purchased Securities as provided in such subparagraph no later than the close of business in the relevant market on such day. If any such
notice is given after the Margin Notice Deadline, the party receiving such notice shall
transfer such cash or Securities no later than the close of business in the relevant market
on the next business day following such notice.
	 
	 	(d)	 	Any cash transferred pursuant to this Paragraph shall be attributed to such Transactions
as shall be agreed upon by Buyer and Seller.
	 
	 	(e)	 	Seller and Buyer may agree, with respect to any or all Transactions hereunder, that the
respective rights of Buyer or Seller (or both) under subparagraphs (a) and (b) of this
Paragraph may be exercised only where a Margin Deficit or Margin Excess, as the case
may be, exceeds a specified dollar amount or a specified percentage of the Repurchase
Prices for such Transactions (which amount or percentage shall be agreed to by Buyer
and Seller prior to entering into any such Transactions).
	 
	 	(f)	 	Seller and Buyer may agree, with respect to any or all Transactions hereunder, that the
respective rights of Buyer and Seller under subparagraphs (a) and (b) of this Paragraph
to require the elimination of a Margin Deficit or a Margin Excess, as the case may be,
may be exercised whenever such a Margin Deficit or Margin Excess exists with respect to
any single Transaction hereunder (calculated without regard to any other Transaction
outstanding under this Agreement).




 









 












	5.	 	Income Payments
	 
	 	 	Seller shall be entitled to receive an amount equal to all Income paid or
distributed on or in
respect of the Securities that is not otherwise received by Seller, to the full extent it
would be
so entitled if the Securities had not been sold to Buyer. Buyer shall, as the parties may
agree
with respect to any Transaction (or, in the absence of any such agreement, as Buyer shall reasonably determine in its discretion), on the date such Income is paid or distributed either
(i)
transfer to or credit to the account of Seller such Income with respect to any Purchased
Securities subject to such Transaction or (ii) with respect to Income paid in cash, apply the
Income payment or payments to reduce the amount, if any, to be transferred to Buyer by
Seller upon termination of such Transaction. Buyer shall not be obligated to take any action
pursuant to the preceding sentence (A) to the extent that such action would result in the creation of a Margin Deficit, unless prior thereto or simultaneously therewith Seller transfers
to
Buyer cash or Additional Purchased Securities sufficient to eliminate such Margin Deficit, or
(B) if an Event of Default with respect to Seller has occurred and is then continuing at the
time such Income is paid or distributed.
	 
	6.	 	Security Interest
	 
	 	 	Although the parties intend that all Transactions hereunder be sales and purchases
and not
loans, in the event any such Transactions are deemed to be loans, Seller shall be deemed to
have pledged to Buyer as security for the performance by Seller of its obligations under each
such Transaction, and shall be deemed to have granted to Buyer a security interest in, all of
the Purchased Securities with respect to all Transactions hereunder and all Income thereon
and other proceeds thereof.
	 
	7.	 	Payment and Transfer
	 
	 	 	Unless otherwise mutually agreed, all transfers of funds hereunder shall be in
immediately
available funds. All Securities transferred by one party hereto to the other party (i) shall
be in
suitable form for transfer or shall be accompanied by duly executed instruments of transfer
or assignment in blank and such other documentation as the party receiving possession may
reasonably request, (ii) shall be transferred on the book-entry system of a Federal Reserve
Bank, or (iii) shall be transferred by any other method mutually acceptable to Seller and
Buyer.
	 
	8.	 	Segregation of Purchased Securities
	 
	 	 	To the extent required by applicable law, all Purchased Securities in the possession
of Seller
shall be segregated from other securities in its possession and shall be identified as subject
to
this Agreement. Segregation may be accomplished by appropriate identification on the books
and records of the holder, including a financial or securities intermediary or a clearing
corporation. All of Seller’s interest in the Purchased Securities shall pass to Buyer on the
Purchase
Date and, unless otherwise agreed by Buyer and Seller, nothing in this Agreement shall preclude Buyer from engaging in repurchase transactions with the Purchased Securities or otherwise selling, transferring, pledging or hypothecating the Purchased Securities, but no such
transaction shall relieve Buyer of its obligations to transfer Purchased Securities to Seller
pursuant to Paragraph 3, 4 or 11 hereof, or of Buyer’s obligation to credit or pay Income to, or
apply Income to the obligations of, Seller pursuant to Paragraph 5 hereof.




 









 












Required Disclosure for Transactions in Which the Seller



Retains Custody of the Purchased Securities




Seller is not permitted to substitute other securities for those subject to this
Agreement and therefore must keep Buyer’s securities segregated at all times, unless
in this Agreement Buyer grants Seller the right to substitute other securities. If
Buyer grants the right to substitute, this means that Buyer’s securities will likely be
commingled with Seller’s own securities during the trading day. Buyer is advised
that, during any trading day that Buyer’s securities are commingled with Seller’s
securities, they [will]* [may]** be subject to liens granted by Seller to [its clearing
bank]* [third parties]** and may be used by Seller for deliveries on other securities
transactions. Whenever the securities are commingled, Seller’s ability to resegregate
substitute securities for Buyer will be subject to Seller’s ability to satisfy [the clearing]* [any]** lien or to obtain substitute securities.




* Language to be used under 17 C.F.R. ß403.4(e) if Seller is a government securities
broker or dealer other than a financial institution.




** Language to be used under 17 C.F.R. ß403.5(d) if Seller is a financial institution.



 




	9.	 	Substitution






	 	(a)	 	Seller may, subject to agreement with and acceptance by Buyer, substitute other
Securities
for any Purchased Securities. Such substitution shall be made by transfer to Buyer of such
other Securities and transfer to Seller of such Purchased Securities. After substitution, the
substituted Securities shall be deemed to be Purchased Securities.
	 
	 	(b)	 	In Transactions in which Seller retains custody of Purchased Securities, the parties
expressly agree that Buyer shall be deemed, for purposes of subparagraph (a) of this
Paragraph, to have agreed to and accepted in this Agreement substitution by Seller of
other Securities for Purchased Securities; provided, however, that such other Securities
shall have a Market Value at least equal to the Market Value of the Purchased Securities
for which they are substituted.






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




 









 






	11.	 	Events of Default
	 
	 	 	In the event that (i) Seller fails to transfer or Buyer fails to purchase Purchased
Securities
upon the applicable Purchase Date, (ii) Seller fails to repurchase or Buyer fails to transfer
Purchased Securities upon the applicable Repurchase Date, (iii) Seller or Buyer fails to comply with Paragraph 4 hereof, (iv) Buyer fails, after one business day’s notice, to comply with
Paragraph 5 hereof, (v) an Act of Insolvency occurs with respect to Seller or Buyer, (vi) any
representation made by Seller or Buyer shall have been incorrect or untrue in any material
respect when made or repeated or deemed to have been made or repeated, or (vii) Seller or
Buyer shall admit to the other its inability to, or its intention not to, perform any of its
obligations hereunder (each an “Event of Default”):






	 	(a)	 	The nondefaulting party may, at its option (which option shall be deemed to have been
exercised immediately upon the occurrence of an Act of Insolvency), declare an Event of
Default to have occurred hereunder and, upon the exercise or deemed exercise of such
option, the Repurchase Date for each Transaction hereunder shall, if it has not already
occurred, be deemed immediately to occur (except that, in the event that the Purchase
Date for any Transaction has not yet occurred as of the date of such exercise or deemed
exercise, such Transaction shall be deemed immediately canceled). The nondefaulting
party shall (except upon the occurrence of an Act of Insolvency) give notice to the
defaulting party of the exercise of such option as promptly as practicable.
	 
	 	(b)	 	In all Transactions in which the defaulting party is acting as Seller, if the
nondefaulting
party exercises or is deemed to have exercised the option referred to in subparagraph (a)
of this Paragraph, (i) the defaulting party’s obligations in such Transactions to repurchase
all Purchased Securities, at the Repurchase Price therefor on the Repurchase Date determined in accordance with subparagraph (a) of this Paragraph, shall thereupon become
immediately due and payable, (ii) all Income paid after such exercise or deemed exercise
shall be retained by the nondefaulting party and applied to the aggregate unpaid
Repurchase Prices and any other amounts owing by the defaulting party hereunder, and
(iii) the defaulting party shall immediately deliver to the nondefaulting party any
Purchased Securities subject to such Transactions then in the defaulting party’s possession or control.
	 
	 	(c)	 	In all Transactions in which the defaulting party is acting as Buyer, upon tender by the
nondefaulting party of payment of the aggregate Repurchase Prices for all such
Transactions, all right, title and interest in and entitlement to all Purchased Securities
subject to such Transactions shall be deemed transferred to the nondefaulting party, and
the defaulting party shall deliver all such Purchased Securities to the nondefaulting party.
	 
	 	(d)	 	If the nondefaulting party exercises or is deemed to have exercised the option referred to
in subparagraph (a) of this Paragraph, the nondefaulting party, without prior notice to
the defaulting party, may:






	 	(i)	 	as to Transactions in which the defaulting party is acting as Seller, (A) immediately
sell, in a recognized market (or otherwise in a commercially reasonable manner) at
such price or prices as the nondefaulting party may reasonably deem satisfactory, any
or all Purchased Securities subject to such Transactions and apply the proceeds
thereof to the aggregate unpaid Repurchase Prices and any other amounts owing by
the defaulting party hereunder or (B) in its sole discretion elect, in lieu of selling all
or a portion of such Purchased Securities, to give the defaulting party credit for such
Purchased Securities in an amount equal to the price therefor on such date, obtained




 









 






	 	 	 	from a generally recognized source or the most recent closing bid quotation from
such a source, against the aggregate unpaid Repurchase Prices and any other
amounts owing by the defaulting party hereunder; and
	 
	 	(ii)	 	as to Transactions in which the defaulting party is acting as Buyer, (A) immediately
purchase, in a recognized market (or otherwise in a commercially reasonable manner) at such price or prices as the nondefaulting party may reasonably deem satisfactory, securities (“Replacement Securities”) of the same class and amount as any
Purchased Securities that are not delivered by the defaulting party to the nondefaulting party as required hereunder or (B) in its sole discretion elect, in lieu of purchasing Replacement Securities, to be deemed to have purchased Replacement Securities
at the price therefor on such date, obtained from a generally recognized source or the
most recent closing offer quotation from such a source.






	 	 	 	Unless otherwise provided in Annex I, the parties acknowledge and agree that (1) the
Securities subject to any Transaction hereunder are instruments traded in a recognized
market, (2) in the absence of a generally recognized source for prices or bid or offer quotations for any Security, the nondefaulting party may establish the source therefor in its
sole discretion and (3) all prices, bids and offers shall be determined together with
accrued Income (except to the extent contrary to market practice with respect to the relevant Securities).
	 
	 	(e)	 	As to Transactions in which the defaulting party is acting as Buyer, the defaulting party
shall be liable to the nondefaulting party for any excess of the price paid (or deemed
paid) by the nondefaulting party for Replacement Securities over the Repurchase Price
for the Purchased Securities replaced thereby and for any amounts payable by the
defaulting party under Paragraph 5 hereof or otherwise hereunder.
	 
	 	(f)	 	For purposes of this Paragraph 11, the Repurchase Price for each Transaction hereunder
in respect of which the defaulting party is acting as Buyer shall not increase above the
amount of such Repurchase Price for such Transaction determined as of the date of the
exercise or deemed exercise by the nondefaulting party of the option referred to in
sub-paragraph (a) of this Paragraph.
	 
	 	(g)	 	The defaulting party shall be liable to the nondefaulting party for (i) the amount of all
reasonable legal or other expenses incurred by the nondefaulting party in connection
with or as a result of an Event of Default, (ii) damages in an amount equal to the cost
(including all fees, expenses and commissions) of entering into replacement transactions
and entering into or terminating hedge transactions in connection with or as a result of
an Event of Default, and (iii) any other loss, damage, cost or expense directly arising or
resulting from the occurrence of an Event of Default in respect of a Transaction.
	 
	 	(h)	 	To the extent permitted by applicable law, the defaulting party shall be liable to the
nondefaulting party for interest on any amounts owing by the defaulting party hereunder,
from the date the defaulting party becomes liable for such amounts hereunder until such
amounts are (i) paid in full by the defaulting party or (ii) satisfied in full by the exercise
of the nondefaulting party’s rights hereunder. Interest on any sum payable by the defaulting party to the nondefaulting party under this Paragraph 11(h) shall be at a rate equal to
the greater of the Pricing Rate for the relevant Transaction or the Prime Rate.




 









 






	 	(i)	 	The nondefaulting party shall have, in addition to its rights hereunder, any rights otherwise available to it under any other agreement or applicable law.






	12.	 	Single Agreement
	 
	 	 	Buyer and Seller acknowledge that, and have entered hereinto and will enter into
each
Transaction hereunder in consideration of and in reliance upon the fact that, all Transactions
hereunder constitute a single business and contractual relationship and have been made in
consideration of each other. Accordingly, each of Buyer and Seller agrees (i) to perform all
of
its obligations in respect of each Transaction hereunder, and that a default in the performance of any such obligations shall constitute a default by it in respect of all Transactions
hereunder, (ii) that each of them shall be entitled to set off claims and apply property held
by
them in respect of any Transaction against obligations owing to them in respect of any other
Transactions hereunder and (iii) that payments, deliveries and other transfers made by either
of them in respect of any Transaction shall be deemed to have been made in consideration of
payments, deliveries and other transfers in respect of any other Transactions hereunder, and
the obligations to make any such payments, deliveries and other transfers may be applied
against each other and netted.
	 
	13.	 	Notices and Other Communications
	 
	 	 	Any and all notices, statements, demands or other communications hereunder may be
given
by a party to the other by mail, facsimile, telegraph, messenger or otherwise to the address
specified in Annex II hereto, or so sent to such party at any other place specified in a
notice of
change of address hereafter received by the other. All notices, demands and requests hereunder may be made orally, to be confirmed promptly in writing, or by other communication as
specified in the preceding sentence.
	 
	14.	 	Entire Agreement; Severability
	 
	 	 	This Agreement shall supersede any existing agreements between the parties
containing general terms and conditions for repurchase transactions. Each provision and agreement herein
shall be treated as separate and independent from any other provision or agreement herein
and shall be enforceable notwithstanding the unenforceability of any such other provision or
agreement.
	 
	15.	 	Non-assignability; Termination






	 	(a)	 	The rights and obligations of the parties under this Agreement and under any
Transaction shall not be assigned by either party without the prior written consent of the
other party, and any such assignment without the prior written consent of the other
party shall be null and void. Subject to the foregoing, this Agreement and any
Transactions shall be binding upon and shall inure to the benefit of the parties and their
respective successors and assigns. This Agreement may be terminated by either party
upon giving written notice to the other, except that this Agreement shall, notwithstanding
such notice, remain applicable to any Transactions then outstanding.
	 
	 	(b)	 	Subparagraph (a) of this Paragraph 15 shall not preclude a party from assigning, charging or otherwise dealing with all or any part of its interest in any sum payable to it under

Paragraph 11 hereof.






	16.	 	Governing Law
	 
	 	 	This Agreement shall be governed by the laws of the State of New York without
giving effect
to the conflict of law principles thereof.




 









 






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






	 	(a)	 	If assets of an employee benefit plan subject to any provision of the
Employee Retirement
Income Security Act of 1974 (“ERISA”) are intended to be used by either party hereto
(the “Plan Party”) in a Transaction, the Plan Party shall so notify the other party prior to
the Transaction. The Plan Party shall represent in writing to the other party that the
Transaction does not constitute a prohibited transaction under ERISA or is otherwise
exempt therefrom, and the other party may proceed in reliance thereon but shall not be
required so to proceed.
	 
	 	(b)	 	Subject to the last sentence of subparagraph (a) of this Paragraph, any such Transaction
shall proceed only if Seller furnishes or has furnished to Buyer its most recent available
audited statement of its financial condition and its most recent subsequent unaudited
statement of its financial condition.
	 
	 	(c)	 	By entering into a Transaction pursuant to this Paragraph, Seller shall be deemed (i) to
represent to Buyer that since the date of Seller’s latest such financial statements, there has
been no material adverse change in Seller’s financial condition which Seller has not disclosed to Buyer, and (ii) to agree to provide Buyer with future audited and unaudited
statements of its financial condition as they are issued, so long as it is a Seller in any
out-standing Transaction involving a Plan Party.






	19.	 	Intent






	 	(a)	 	The parties recognize that each Transaction is a “repurchase agreement” as
that term is
defined in Section 101 of Title 11 of the United States Code, as amended (except insofar
as the type of Securities subject to such Transaction or the term of such Transaction
would render such definition inapplicable), and a “securities contract” as that term is
defined in Section 741 of Title 11 of the United States Code, as amended (except insofar
as the type of assets subject to such Transaction would render such definition inapplicable).
	 
	 	(b)	 	It is understood that either party’s right to liquidate Securities delivered to it in
connection with Transactions hereunder or to exercise any other remedies pursuant to
Paragraph 11 hereof is a contractual right to liquidate such Transaction as described in
Sections 555 and 559 of Title 11 of the United States Code, as amended.
	 
	 	(c)	 	The parties agree and acknowledge that if a party hereto is an “insured depository institution,” as such term is defined in the Federal Deposit Insurance Act, as amended
(“FDIA”), then each Transaction hereunder is a “qualified financial contract,” as that term
is defined in FDIA and any rules, orders or policy statements thereunder (except insofar
as the type of assets subject to such Transaction would render such definition inapplicable).




 









 






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






	20.	 	Disclosure Relating to Certain Federal Protections
	 
	 	 	The parties acknowledge that they have been advised that:






	 	(a)	 	in the case of Transactions in which one of the parties is a broker or dealer registered
with the Securities and Exchange Commission (“SEC”) under Section 15 of the Securities
Exchange Act of 1934 (“1934 Act”), the Securities Investor Protection Corporation has
taken the position that the provisions of the Securities Investor Protection Act of 1970
(“SIPA”) do not protect the other party with respect to any Transaction hereunder;
	 
	 	(b)	 	in the case of Transactions in which one of the parties is a government securities broker
or a government securities dealer registered with the SEC under Section 15C of the 1934
Act, SIPA will not provide protection to the other party with respect to any Transaction
hereunder; and
	 
	 	(c)	 	in the case of Transactions in which one of the parties is a financial institution, funds
held by the financial institution pursuant to a Transaction hereunder are not a deposit
and therefore are not insured by the Federal Deposit Insurance Corporation or the
National Credit Union Share Insurance Fund, as applicable.





	 	 	 	 	 	 	 	 	 	 	 
	BEAR, STEARNS & CO. INC.	 	 	 	CSE MORTGAGE LLC	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	PARTY A	 	 	 	PARTY B	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	BY:

	 	/s/ Timothy Greene
	 	 	 	BY:
	 	/s/ Thomas A. Fink	 	 
	 

	 	 

	 	 
	 	 	 	 

	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	NAME:

	 	Timothy Greene
	 	 	 	NAME:
	 	Thomas A. Fink	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	TITLE :

	 	Senior Director
	 	 	 	TITLE:
	 	Chief Financial Officer and Senior Vice President	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	DATE:

	 	12/8/05
	 	 	 	DATE:
	 	12/8/05	 	 






 









 





ANNEX II




Names and Addresses for Communications Between Parties




BEAR, STEARNS & CO. INC.

GOVERNMENT OPERATIONS

1 METROTECH CENTER NORTH

7TH FLOOR

BROOKLYN, NY 11201-3859

ATTENTION: SR. MANAGING DIRECTOR

TELEPHONE: (212) 272-1203




CSE MORTGAGE LLC

4445 WILLARD AVE. 12TH FLOOR

CHEVY CHASE, MD 21815

ATTN: GENERAL COUNSEL

FACSIMILE NO.: 301-841-2380




with a copy to:




CSE MORTGAGE LLC

4445 WILLARD AVE. 12TH FLOOR

CHEVY CHASE, MD 21815

ATTN: TREASURY

FACSIMILE NO.: 301-841-2307




 









 





Annex I




Supplemental Terms and Conditions



This Annex I forms a part of the Master Repurchase Agreement dated as of December 8, 2005 (the
“Agreement”) between BEAR, STEARNS & CO. INC. (“Party A”) and CSE MORTGAGE LLC (“Party B”).
Capitalized terms used but not defined in this Annex I shall have the meanings ascribed to them in
the Agreement.





	1.	 	Other Applicable Annexes. In addition to this Annex I and Annex II, Schedule
1 shall form a part of the Agreement and shall be applicable thereunder.
	 
	2.	 	Definitions. For purposes of the Agreement and this Annex I, the following
terms shall have the following meanings:






“Business Day” or “business day”, with respect to any Transaction hereunder, a day on
which regular trading may occur in the principal market for the Purchased Securities
subject to such Transaction, which includes shortened trading days, days on which
trades are permitted to occur but do not in fact occur and days on which the Purchased
Securities are subject to percentage of movement or volume limitations, provided,
however, that for purposes of calculating Market Value, such term shall mean a day
on which regular trading occurs in the principal market for the assets the value of
which is being determined. Notwithstanding the foregoing, (i) for purposes of
Paragraph 4 of the Agreement, “business day” shall mean any day on which regular
trading occurs in the principal market for any Purchased Securities or for any assets
constituting Additional Purchased Securities under any outstanding Transaction
hereunder and “next business day” shall mean the next day on which a transfer of
Additional Purchased Securities may be effected in accordance with Paragraph 7 of the
Agreement, and (ii) in no event shall a Saturday or Sunday be considered a business
day.




“Margin Notice Deadline” means 10:00 A.M. New York time.




	3.	 	Definition of Market Value. The definition of “Market Value” in Paragraph
2(j) is amended by adding thereto after “a generally recognized source agreed to by the
parties” the following: “and, in the absence of such agreement, determined by Party A acting
in good faith and in a commercially reasonable manner selected by it, provided,
however, that Party A shall have no obligation to use third party pricing”.






	4.	 	Threshold Amount. Paragraph 4(e) is hereby amended and restated in its
entirety to read as follows:






	 	“(e)	 	 Seller and Buyer hereby agree, with respect to all Transactions hereunder,
that the respective rights of Buyer or Seller under subparagraphs (a) and (b) of this
Paragraph may be exercised only where a Margin Deficit or Margin Excess, as the case
may be, exceeds $500,000. “






	5.	 	Purchase Price Maintenance.
	 
	 	 	(a) The parties agree that in any Transaction hereunder whose term extends over an Income
payment date for the Securities subject to such transaction, Buyer shall on the date such
Income is paid transfer to or credit to the account of Seller an amount equal to such Income
payment (less the amount, if any, of cash and/or Securities that Seller is obligated




 









 






	 	 	to transfer to Buyer on such date in
accordance with Paragraph 4 of the Agreement) or payments pursuant to Paragraph 5(i) and
shall not apply the Income payment or payments to reduce the amount to be transferred to
Buyer or Seller upon termination of the Transaction pursuant to Paragraph 5(ii) of the
Agreement.


	 	 	 (b) Notwithstanding the definition of Purchase Price in Paragraph 2 of the Agreement and the
provisions of Paragraph 4 of the Agreement, the parties agree (i) that the Purchase Price
will not be increased or decreased by the amount of any cash transferred by one party to the
other pursuant to Paragraph 4 of the Agreement and (ii) that transfer of such cash shall
be treated as if it constituted a transfer of Securities (with a Market Value equal to the
U.S. dollar amount of such cash) pursuant to Paragraph 4(a) or (b), as the case may be
(including for purposes of the definition of “Additional Purchased Securities”).
	 
	 	 	(c) The parties agree that any cash transferred by Seller to Buyer pursuant to Paragraph 4
of the Agreement shall earn interest at a rate equal to the Fed Funds effective rate.






	6.	 	Paragraph 9 Addition. The following paragraphs shall be added to Paragraph 9
of the Agreement:






	 	“(c)	 	 In the case of any Transaction for which the Repurchase Date is other than the
business day immediately following the Purchase Date and with respect to which Seller
does not have any existing right to substitute substantially the same Securities for
the Purchased Securities, Seller shall have the right, subject to the proviso to this
sentence, upon notice to Buyer, which notice shall be given at or prior to 10:00 a.m.
New York time on such business day, to substitute substantially the same Securities for
any Purchased Securities; provided, however, that Buyer may elect, by the close of
business on the business day notice is received, or by the close of the next business
day if notice is given after 10:00 a.m. New York time on such day, not to accept such
substitution. In the event such substitution is accepted by Buyer, such substitution
shall be made by Seller’s transfer to Buyer of such other Securities and Buyer’s
transfer to Seller of such Purchased Securities, and after such substitution, the
substituted Securities shall be deemed to be Purchased Securities. In the event Buyer
elects not to accept such substitution, Buyer shall offer Seller the right to terminate
the Transaction.
	 
	 	(d)	 	In the event Seller exercises its right to substitute or terminate under
sub-paragraph (c), Seller shall be obligated to pay to Buyer, by the close of the
business day of such substitution or termination, as the case may be, an amount equal
to (A) Buyer’s actual cost (including all fees, expenses and commissions) of (i)
entering into replacement transactions; (ii) entering into or terminating hedge
transactions; and/or (iii) terminating transactions or substituting securities in like
transactions with third parties in connection with or as a result of such substitution
or termination, and (B) to the extent Buyer determines not to enter into replacement
transactions, the loss incurred by Buyer directly arising or resulting from such
substitution or termination. The foregoing amounts shall be solely determined and
calculated by Buyer in good faith.”






	7.	 	Limited Recourse. Paragraph 11(i) of the Agreement is hereby amended and
restated in its entirety to read as follows:
	 
	 	 	“(i) The nondefaulting party shall have, in addition to its rights hereunder, any rights
otherwise available to it under any other agreement or applicable law; provided,




 









 






	 	 	however,
that notwithstanding any other provision of this Agreement, except with respect to
Collateral (as
defined in the Master Netting Agreement between the parties, dated as of the date hereof
(the “Master Netting Agreement”)) pledged under the Master Netting Agreement or pursuant to
a Governing Agreement (as defined in the Master Netting Agreement), Buyer shall have no
recourse to Seller in excess of the Recourse Amount (as defined below), with respect to (i)
any claims against Seller (either in law or equity) arising under this Agreement or in
connection with the Transactions hereunder, or (ii) the payment or performance of any other
debt, liability, obligation, covenant or duty owing under this Agreement or in connection
with the Transactions hereunder. For purposes of this Agreement, ““Recourse Amount"” means,
as of any date upon which an Event of Default occurs hereunder, an aggregate amount equal to
10% of the aggregate Purchase Price of all Transactions outstanding hereunder on such date.
For the avoidance of doubt, nothing herein shall limit Buyer’s rights with respect to
Purchased Securities or Buyer’s rights to contractual or common-law setoff against Seller
upon the occurrence of an Event of Default hereunder or under the Master Netting Agreement
between the parties against any obligation Buyer may owe Seller under this Agreement or
otherwise.”


	8.	 	Confirmations. Party A will deliver the Confirmations referred to in
Paragraph 3(b).
	 
	9.	 	Delivery by Buyer of Purchased Securities on Repurchase Date. For the
avoidance of doubt, Buyer and Seller hereby acknowledge and agree that on each Repurchase
Date, Buyer shall transfer back to Seller Purchased Securities with CUSIPs identical to the
CUSIPs of the Purchased Securities transferred to Buyer by Seller on the corresponding
Purchase Date.
	 
	10.	 	Annex and Schedules Control. In the event of any express inconsistency
between the provisions of any Annex or Schedule to the Agreement and the provisions of the
Agreement, the terms contained in such Annex or Schedule shall prevail.
	 
	 	 	This Annex I is entered into as of the date first set forth above.





	 	 	 	 	 
	BEAR, STEARNS & CO. INC.	 	 
	 
	 	 	 	 
	By:

	 	/s/ Timothy Greene	 	 
	 

	 	 

Name: Timothy Greene
	 	 
	 

	 	Title: Senior Managing Director	 	 
	 
	 	 	 	 
	CSE MORTGAGE LLC	 	 
	 
	 	 	 	 
	By:

	 	/s/ Thomas A. Fink	 	 
	 

	 	 

Name: Thomas A. Fink
	 	 
	 

	 	Title: Chief Financial Officer, Senior Vice President