Exhibit 10.2


 


 




 


 





$1,695,000,000


 


2011 SECOND
PRIORITY CREDIT AGREEMENT


 


dated as of March 13,
2009


 


among


 


iSTAR
FINANCIAL INC.,


 


THE BANKS
LISTED HEREIN,


 


JPMORGAN CHASE
BANK, N.A.

as Administrative Agent,


 


BANK OF
AMERICA, N.A. 

and

CITICORP NORTH AMERICA, INC., 

as Syndication Agents,


 


J.P. MORGAN
SECURITIES INC.,

BANC OF AMERICA SECURITIES LLC

and

CITIGROUP GLOBAL MARKETS INC.,

as Joint Lead Arrangers and Joint Bookrunners




 


 





 


 

















 


Table of Contents


 


	
   

  	
  Page

  
	
   

  	
   

  
	
  ARTICLE I DEFINITIONS

  	
  1

  
	
   

  	
   

  
	
  Section 1.1. Definitions

  	
  1

  
	
  Section 1.2. Accounting Terms and
  Determinations

  	
  29

  
	
   

  	
   

  
	
  ARTICLE II THE CREDITS

  	
  29

  
	
   

  	
   

  
	
  Section 2.1. Term Commitments

  	
  29

  
	
  Section 2.2. Revolving Credit
  Commitments

  	
  29

  
	
  Section 2.3. Notice of Borrowing

  	
  30

  
	
  Section 2.4. Swingline Loan
  Subfacility

  	
  33

  
	
  Section 2.5. Notice to Banks; Funding
  of Loans; Replacement of Defaulting Bank

  	
  35

  
	
  Section 2.6. Notes

  	
  37

  
	
  Section 2.7. Method of Electing
  Interest Rates

  	
  38

  
	
  Section 2.8. Interest Rates

  	
  39

  
	
  Section 2.9. Fees

  	
  40

  
	
  Section 2.10. Maturity Date

  	
  40

  
	
  Section 2.11. Optional Prepayments

  	
  41

  
	
  Section 2.12. Mandatory Prepayments;
  Cure

  	
  42

  
	
  Section 2.13. Non-Pro Rata Prepayments

  	
  43

  
	
  Section 2.14. General Provisions as to
  Payments

  	
  44

  
	
  Section 2.15. Priority of Payments

  	
  45

  
	
  Section 2.16. Funding Losses

  	
  46

  
	
  Section 2.17. Computation of Interest
  and Fees

  	
  46

  
	
  Section 2.18. Use of Proceeds

  	
  46

  
	
  Section 2.19. Letters of Credit

  	
  46

  
	
  Section 2.20. Letter of Credit Usage
  Absolute

  	
  49

  
	
  Section 2.21. Letters of Credit
  Maturing after the Maturity Date

  	
  50

  
	
  Section 2.22. Payments

  	
  51

  
	
  Section 2.23. Collateral

  	
  51

  
	
  Section 2.24. Mortgages

  	
  53

  
	
   

  	
   

  
	
  ARTICLE III CONDITIONS

  	
  54

  
	
   

  	
   

  
	
  Section 3.1. Closing

  	
  54

  
	
  Section 3.2. Borrowings

  	
  57

  
	
   

  	
   

  
	
  ARTICLE IV REPRESENTATIONS AND WARRANTIES

  	
  58

  
	
   

  	
   

  
	
  Section 4.1. Existence and Power

  	
  58

  
	
  Section 4.2. Power and Authority

  	
  58

  
	
  Section 4.3. No Violation

  	
  59

  
	
  Section 4.4. Financial Information

  	
  59

  
	
  Section 4.5. Litigation

  	
  59

  



 


i

















 


	
  Section 4.6. Compliance with ERISA

  	
  60

  
	
  Section 4.7. Environmental

  	
  60

  
	
  Section 4.8. Taxes

  	
  61

  
	
  Section 4.9. Full Disclosure

  	
  61

  
	
  Section 4.10. Solvency

  	
  61

  
	
  Section 4.11. Use of Proceeds

  	
  61

  
	
  Section 4.12. Governmental Approvals

  	
  61

  
	
  Section 4.13. Investment Company Act

  	
  62

  
	
  Section 4.14. Principal Offices

  	
  62

  
	
  Section 4.15. REIT Status

  	
  62

  
	
  Section 4.16. Patents, Trademarks, etc.

  	
  62

  
	
  Section 4.17. Judgments

  	
  62

  
	
  Section 4.18. No Default

  	
  62

  
	
  Section 4.19. Licenses, etc.

  	
  62

  
	
  Section 4.20. Compliance with Law

  	
  62

  
	
  Section 4.21. No Burdensome
  Restrictions

  	
  63

  
	
  Section 4.22. Brokers’ Fees

  	
  63

  
	
  Section 4.23. Labor Matters

  	
  63

  
	
  Section 4.24. Insurance

  	
  63

  
	
  Section 4.25. Organizational Documents

  	
  63

  
	
  Section 4.26. Unencumbered Assets and
  Indebtedness

  	
  64

  
	
  Section 4.27. Ownership of Property;
  Liens

  	
  64

  
	
  Section 4.28. Subsidiaries

  	
  64

  
	
  Section 4.29. Security Documents

  	
  64

  
	
  Section 4.30. Mortgages

  	
  64

  
	
   

  	
   

  
	
  ARTICLE V AFFIRMATIVE AND NEGATIVE COVENANTS

  	
  65

  
	
   

  	
   

  
	
  Section 5.1. Information

  	
  65

  
	
  Section 5.2. Payment of Obligations

  	
  68

  
	
  Section 5.3. Maintenance of Property;
  Insurance; Leases

  	
  68

  
	
  Section 5.4. Maintenance of Existence

  	
  68

  
	
  Section 5.5. Compliance with Laws

  	
  68

  
	
  Section 5.6. Inspection of Property,
  Books and Records

  	
  69

  
	
  Section 5.7. Existence

  	
  69

  
	
  Section 5.8. Deposit Accounts

  	
  69

  
	
  Section 5.9. Independent Director

  	
  70

  
	
  Section 5.10. Financial Covenants and
  Restricted Payments

  	
  70

  
	
  Section 5.11. Restriction on
  Fundamental Changes

  	
  71

  
	
  Section 5.12. Changes in Business

  	
  71

  
	
  Section 5.13. Borrower Status

  	
  72

  
	
  Section 5.14. Other Indebtedness

  	
  72

  
	
  Section 5.15. Liens

  	
  72

  
	
  Section 5.16. Prepayments of Secured
  Exchange Notes, Other Notes, 2012 Second Priority Credit Agreement and
  Existing Credit Agreements; Amendments

  	
  74

  
	
  Section 5.17. Coverage Test

  	
  74

  



 


ii

















 


	
  Section 5.18. Forward Equity Contracts

  	
  74

  
	
  Section 5.19. Restrictive Agreements

  	
  74

  
	
  Section 5.20. Limitation on Activities
  of the Collateral SPVs

  	
  75

  
	
  Section 5.21. Transactions with
  Affiliates

  	
  75

  
	
  Section 5.22. Post-Closing Covenants

  	
  75

  
	
   

  	
   

  
	
  ARTICLE VI DEFAULTS

  	
  76

  
	
   

  	
   

  
	
  Section 6.1. Events of Default

  	
  76

  
	
  Section 6.2. Rights and Remedies

  	
  79

  
	
  Section 6.3. Notice of Default

  	
  80

  
	
  Section 6.4. Actions in Respect of
  Letters of Credit

  	
  80

  
	
  Section 6.5. Distribution of Proceeds
  after Default

  	
  82

  
	
   

  	
   

  
	
  ARTICLE VII THE AGENTS; CERTAIN MATTERS RELATING TO THE BANKS

  	
  82

  
	
   

  	
   

  
	
  Section 7.1. Appointment and
  Authorization

  	
  82

  
	
  Section 7.2. Agency and Affiliates

  	
  82

  
	
  Section 7.3. Action by Agents

  	
  82

  
	
  Section 7.4. Consultation with Experts

  	
  83

  
	
  Section 7.5. Liability of Agents

  	
  83

  
	
  Section 7.6. Indemnification

  	
  83

  
	
  Section 7.7. Credit Decision

  	
  83

  
	
  Section 7.8. Successor Agent

  	
  84

  
	
  Section 7.9. Consents and Approvals

  	
  84

  
	
   

  	
   

  
	
  ARTICLE VIII CHANGE IN CIRCUMSTANCES

  	
  85

  
	
   

  	
   

  
	
  Section 8.1. Basis for Determining
  Interest Rate Inadequate or Unfair

  	
  85

  
	
  Section 8.2. Illegality

  	
  85

  
	
  Section 8.3. Increased Cost and
  Reduced Return

  	
  86

  
	
  Section 8.4. Taxes

  	
  87

  
	
  Section 8.5. Base Rate Loans
  Substituted for Affected Euro-Currency Loans

  	
  90

  
	
   

  	
   

  
	
  ARTICLE IX MISCELLANEOUS

  	
  91

  
	
   

  	
   

  
	
  Section 9.1. Notices

  	
  91

  
	
  Section 9.2. No Waivers

  	
  91

  
	
  Section 9.3. Expenses; Indemnification

  	
  91

  
	
  Section 9.4. Sharing of Set-Offs

  	
  93

  
	
  Section 9.5. Amendments and Waivers

  	
  93

  
	
  Section 9.6. Successors and Assigns

  	
  95

  
	
  Section 9.7. Governing Law; Submission
  to Jurisdiction; Judgment Currency

  	
  97

  
	
  Section 9.8. Counterparts;
  Integration; Effectiveness

  	
  98

  
	
  Section 9.9. WAIVER OF JURY TRIAL

  	
  98

  
	
  Section 9.10. Survival

  	
  98

  
	
  Section 9.11. Domicile of Loans

  	
  98

  
	
  Section 9.12. Limitation of Liability

  	
  98

  



 


iii

















 


	
  Section 9.13. Recourse Obligation

  	
  99

  
	
  Section 9.14. Confidentiality

  	
  99

  
	
  Section 9.15. USA Patriot Act

  	
  99

  
	
  Section 9.16. Acknowledgments

  	
  100

  
	
  Section 9.17. Releases of Guarantees
  and Liens

  	
  100

  
	
  Section 9.18. Delivery of Promissory
  Notes

  	
  100

  



 


	
  SCHEDULES:

  	
   

  
	
   

  	
   

  
	
  SCHEDULE 1.1A

  	
  Commitments

  
	
  SCHEDULE 1.1B

  	
  Existing Letters of Credit

  
	
  SCHEDULE 1.1C

  	
  Listed Eligible Assets

  
	
  SCHEDULE 1.1D

  	
  Permitted Liens

  
	
  SCHEDULE 1.1E

  	
  Pledged Collateral List

  
	
  SCHEDULE 4.4(b)

  	
  Material Indebtedness

  
	
  SCHEDULE 4.6(a)

  	
  Multiemployer Plans/Collective Bargaining Agreements

  
	
  SCHEDULE 4.26

  	
  Unencumbered Assets, Unsecured Debt

  
	
  SCHEDULE 4.28

  	
  Subsidiaries

  
	
  SCHEDULE 4.29

  	
  Filing Jurisdictions

  
	
   

  	
   

  
	
  EXHIBITS:

  	
   

  
	
   

  	
   

  
	
  EXHIBIT A

  	
  Form of Borrowing Base Certificate

  
	
  EXHIBIT B

  	
  Form of Cash Flow Projections

  
	
  EXHIBIT C

  	
  Form of Security Agreement

  
	
  EXHIBIT D

  	
  Form of Collateral Report

  
	
  EXHIBIT E

  	
  Form of Collateral Trust Agreement

  
	
  EXHIBIT F

  	
  Form of Guarantee Agreement

  
	
  EXHIBIT G-1

  	
  Form of Term Loan Note

  
	
  EXHIBIT G-2

  	
  Form of Revolving Credit Loan Note

  
	
  EXHIBIT G-3

  	
  Form of Swingline Loan Note

  
	
  EXHIBIT H

  	
  Notice Addresses

  
	
  EXHIBIT I

  	
  Transfer Supplement

  
	
  EXHIBIT J

  	
  Form of Mortgage

  



 


iv

















 


2011 SECOND
PRIORITY CREDIT AGREEMENT


 


2011 SECOND PRIORITY CREDIT AGREEMENT (this “Agreement”)
dated as of March 13, 2009, among iSTAR FINANCIAL INC. (the “Borrower”),
the BANKS listed on the signature pages hereof, JPMORGAN CHASE BANK, N.A.,
as the Administrative Agent, BANK OF AMERICA, N.A. and CITICORP NORTH AMERICA,
INC., as Syndication Agents, and J.P. MORGAN SECURITIES INC., BANC OF AMERICA
SECURITIES LLC and CITIGROUP GLOBAL MARKETS INC., as Joint Lead Arrangers and
Joint Bookrunners.


 


W I T N E S S
E T H


 


WHEREAS, the Borrower has requested that the
Banks provide a term loan credit facility and a revolving credit facility; and


 


WHEREAS, the Banks are willing to do so on
the terms and conditions set forth herein;


 


NOW, THEREFORE, for good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto agree as follows:


 


ARTICLE I


 


DEFINITIONS


 


Section 1.1. Definitions.  The following terms, as used
herein, have the following meanings:


 


“2012 Second Priority Credit Agreement”
means the $950,000,000 2012 Second Priority Credit Agreement, dated as of the
date hereof, as amended, supplemented or otherwise modified from time to time,
by and among the Borrower, the lenders party thereto, and JPMorgan Chase Bank,
N.A., as administrative agent.


 


“Acceleration Event” has the meaning
set forth in the Collateral Trust Agreement.


 


“Administrative Agent” means (i) with
respect to Notices of Borrowing and the administration of Loans denominated in
an Alternate Currency and interest and fee payments with respect to Loans
denominated in an Alternate Currency, J.P. Morgan Europe Limited; and (ii) for
all other purposes under this Agreement, JPMorgan Chase Bank, N.A., in each case
in its respective capacity as Administrative Agent hereunder, and its
respective permitted successors in such capacity in accordance with the terms
of this Agreement.


 


“Administrative Questionnaire” means
with respect to each Bank, an administrative questionnaire in the form prepared
by the Administrative Agent and submitted to the Administrative Agent (with a
copy to the Borrower) duly completed by such Bank.


 


“Affiliate”, as applied to any Person,
means any other Person that directly or indirectly controls, is controlled by,
or is under common control with, that Person. 
For purposes


 

















 


of this definition, “control” (including,
with correlative meanings, the terms “controlling”, “controlled by” and “under
common control with”), as applied to any Person, means the possession, directly
or indirectly, of the power to vote ten percent (10.0%) or more of the equity
securities having voting power for the election of directors of such Person or
otherwise to direct or cause the direction of the management and policies of
that Person, whether through the ownership of voting equity securities or by
contract or otherwise.


 


“Agents” means the Administrative
Agent, the Syndication Agents, the Joint Lead Arrangers and the Joint
Bookrunners, collectively.


 


“Agreement” means this 2011 Second
Priority Credit Agreement as the same may from time to time hereafter be
modified, supplemented or amended.


 


“Alternate Currency” means the lawful
currency of any of (i) the United Kingdom (British Pounds Sterling) or (ii) the
European Economic Union (Euros) or (iii) Canada (Canadian Dollars).


 


“Applicable Fee Percentage” means the
respective percentages per annum determined, at any time, based on the range
into which Borrower’s Credit Rating then falls, in accordance with the table set
forth below.  Any change in Borrower’s
Credit Rating causing it to move to a different range on the table shall effect
an immediate change in the Applicable Fee Percentage.  Borrower shall have not less than two (2) Credit
Ratings at all times.  In the event that
Borrower has two (2) or more Credit Ratings that are not all equivalent,
the Applicable Fee Percentage shall be determined by the highest Credit Rating;
provided that such highest Credit Rating shall be from S&P or
Moody’s; provided, further, that if such highest Credit Rating is not from
S&P or Moody’s, then the Applicable Fee Percentage shall be determined by
the highest Credit Rating from either S&P or Moody’s.


 


	
  Range
  of Borrower’s Credit Rating

  Applicable (S&P/Moody’s Ratings)

  	
   

  	
  Fee
  Percentage

  (% per annum)

  
	
  >BBB+/Baa1

  	
   

  	
  0.09

  
	
  BBB+/Baa1

  	
   

  	
  0.10

  
	
  BBB/Baa2

  	
   

  	
    0.125

  
	
  BBB-/Baa3

  	
   

  	
  0.15

  
	
  <BB+/Ba1

  	
   

  	
  0.20

  



 


“Applicable Lending Office” means with
respect to any Bank, (i) in the case of its Base Rate Loans and Swingline
Loans, its Domestic Lending Office and (ii) in the case of its
Euro-Currency Loans, its Euro-Currency Lending Office.


 


“Applicable Margin” means with respect
to each Loan, the respective percentages per annum determined, at any time,
based on the range into which the Borrower’s Credit Rating then falls, in
accordance with the table set forth below. Any change in the Borrower’s Credit
Rating causing it to move to a different range on the table shall effect an
immediate change in the Applicable Margin. 
In the event that the Borrower has two (2) or more Credit Ratings
that are not all equivalent, the Applicable Margin shall be determined by the
higher Credit Rating from either S&P or Moody’s.  In the event that the Borrower has only one (1) Credit
Rating, the


 


2

















 


Applicable Margin shall be determined by such
Credit Rating.  In the event that the
Borrower does not have a Credit Rating, the Applicable Margin shall be the
highest percentage per annum set forth on the table below.


 


	
  Range
  of the Borrower’s 

  Credit Rating 

  (S&P/Moody’s Ratings)

  	
   

  	
  Applicable
  Margin for

  Base Rate Loans 

  (% per annum)

  	
   

  	
  Applicable
  Margin for 

  Euro Currency Loans 

  (% per annum)

  
	
  =BBB+/Baa1

  	
   

  	
  0.25

  	
   

  	
  1.25

  
	
  =BBB/Baa2  

  	
   

  	
  0.50

  	
   

  	
  1.50

  



 


“Assignee” has the meaning set forth
in Section 9.6(c).


 


“Available Secured Bank Exposure”
means, on any date of determination, the sum of (i) the aggregate undrawn
commitments under the First Priority Credit Agreement on such date, (ii) the
aggregate undrawn commitments under the 2012 Second Priority Credit Agreement
on such date, and (iii) the aggregate undrawn Commitments hereunder on
such date.


 


“Available Secured Note Exposure”
means, on any date of determination, the excess of (i) $1,000,000,000 over
(ii) the total aggregate principal amount of Second Priority Secured
Exchange Notes issued on or prior to such date.


 


“Bank” means each entity (other than
the Borrower) listed on the signature pages hereof, each Assignee which
becomes a Bank pursuant to Section 9.6(c), and their respective
successors.  For purposes of this
Agreement, neither J.P. Morgan Securities, Inc., Citigroup Global Markets, Inc.
nor Banc of America Securities LLC shall constitute a “Bank.”


 


“Bank Reply Period” has the meaning
set forth in Section 7.9.


 


“Bankruptcy Code” means Title 11 of
the United States Code, entitled “Bankruptcy”, as amended from time to time,
and any successor statute or statutes.


 


“Base Euro-Currency Rate” means a rate
per annum equal to the rate for deposits in Dollars or the applicable Alternate
Currency with maturities comparable to the applicable Interest Period which (a) in
the case of Dollars or any Alternate Currency other than Euros, appears on
Reuters Page LIBOR1 as of 11:00 a.m., London time, on the Quotation
Date, or (b) in the case of Euros, appears on the page of the Reuters
Screen which displays an average rate of the Banking Federation of the European
Union for the Euro as of 11.00 a.m., Brussels time, on the Quotation Date;
provided, however, if such rate does not appear on Reuters Page LIBOR1
or the Reuters Screen which displays an average rate of the Banking Federation
of the European Union for the Euro, as applicable, or if Reuters Page LIBOR1
or the Reuters Screen which displays an average rate of the Banking Federation
of the European Union for the Euro, as applicable, is no longer available, the
“Base Euro-Currency Rate” applicable to a particular Interest Period means a
rate per annum equal to the rate at which deposits in Dollars or the applicable
Alternate Currency, as the case may be, in an amount approximately equal to the
applicable Euro-Currency Loan(s), and with maturities comparable to the last
day of the Interest Period with respect to which such Base Euro-Currency Rate
is applicable, are offered in immediately available funds in the London
interbank market (or in the case of Euros, the


 


3

















 


European
interbank market) to the London office of the Administrative Agent by leading
banks in the London interbank market (or in the case of Euros, the European
interbank market), at 11:00 a.m., London time (or in the case of Euros,
Brussels time) on the Quotation Date.


 


“Base Rate” means, for any day, a rate
per annum equal to the highest of (i) the Prime Rate for such day, (ii) the
sum of 0.50% plus the Federal Funds Rate for such day and (iii) the
Euro-Currency Rate for a one month Interest Period as to which such day (or if
such day is not a Business Day, the immediately preceding Business Day) is the
Quotation Date plus 1.00%.  Each change
in the Base Rate shall become effective automatically as of the opening of
business on the date of such change in the Base Rate, without prior written
notice to the Borrower or the Banks.


 


“Base Rate Borrowing” means a
Borrowing comprised of Base Rate Loans.


 


“Base Rate Loan” means a Loan in
Dollars made or to be made by a Bank the interest on which is calculated by
reference to the Base Rate in accordance with the provisions of this Agreement.


 


“Borrower” has the meaning set forth
in the preamble hereto.


 


“Borrower’s Share” means the
Borrower’s direct or indirect share of an Investment Affiliate based upon the
Borrower’s percentage ownership (whether direct or indirect) of such Investment
Affiliate.


 


“Borrowing” means a Revolving Credit
Borrowing, a Swingline Borrowing or a Term Loan Borrowing, as the context may
require.


 


“Borrowing Base Certificate” means a
certificate substantially in the form of Exhibit A.


 


“Borrowing Base Value” means, as of
any date of determination:


 


(i)                    with respect to any Performing Loan Asset, the
book value of such Performing Loan Asset, determined in accordance with GAAP;


 


(ii)                   with respect to any Non-Performing Loan Asset, the
book value of such Non-Performing Loan Asset after giving effect to specific
reserves therefor established by the Borrower as reflected in its GAAP
financial statements;


 


(iii)                  with respect to the equity interests in a
Collateral LLC owning any Credit Tenant Lease Assets, the undepreciated book
value of such Credit Tenant Lease Assets, determined in accordance with GAAP
(reflecting any impairment taken by the applicable Collateral LLC but without
adding back any depreciation before the most recent such impairment);


 


(iv)                  with respect to the equity interests in a
Collateral LLC owning Other Real Estate Owned Assets, the book value of such
Other Real Estate


 


4

















 


Owned Assets, determined in accordance with GAAP
(reflecting any impairment taken by the applicable Collateral LLC); and


 


(v)                   with respect to the equity interests in a
Collateral LLC owning assets other than Credit Tenant Lease Assets or Other
Real Estate Owned Assets, the value of such assets as determined in accordance
with the foregoing clauses;


 


provided, however,
that to the extent the sum of (x) the Borrowing Base Value of
Non-Performing Loan Assets plus (y) the Borrowing Base Value of Other Real
Estate Owned Assets exceeds 20% of the total aggregate Borrowing Base Value of
the Collateral, such excess shall be disregarded in calculating the aggregate
Borrowing Base Value of the Collateral; provided that the Joint Lead
Arrangers may determine, in their sole and absolute discretion, to increase the
foregoing concentration limitation on Non-Performing Loan Assets and Other Real
Estate Owned Assets up to 30%, which concentration limitation may be further
increased solely with the consent of the Required Banks.  If at any time the Joint Lead Arrangers
determine to make any such exception with respect thereto, the Non-Performing
Loan Assets and Other Real Estate Owned Assets comprising such excess amount
shall be included in calculating the aggregate Borrowing Base Value.  Notwithstanding anything to the contrary
contained herein, there shall be no Borrowing Base Value attributable to (i) the
equity interests in any Collateral SPV or (ii) any assets owned by any
Collateral LLC other than any Loan Assets, Credit Tenant Lease Assets, Other
Real Estate Owned Assets or interests in Venture LLCs.


 


 “Business
Day” means any day except a Saturday, Sunday or other day on which commercial
banks in New York City are authorized by law to close.


 


“Capital Leases” as applied to any
Person, means any lease of any property (whether real, personal or mixed) by
that Person as lessee which, in conformity with GAAP, is or should be accounted
for as a capital lease on the balance sheet of that Person.


 


“Cash or Cash Equivalents” means (a) cash;
(b) marketable direct obligations issued or unconditionally guaranteed by
the United States Government or issued by an agency thereof and backed by the full
faith and credit of the United States, in each case maturing within one (1) year
after the date of acquisition thereof; (c) marketable direct obligations
issued by any state of the United States of America or any political
subdivision of any such state or any public instrumentality thereof maturing
within ninety (90) days after the date of acquisition thereof and, at the time
of acquisition, having one of the two highest ratings obtainable from any two
of S&P, Moody’s or Fitch (or, if at any time no two of the foregoing shall
be rating such obligations, then from such other nationally recognized rating
services acceptable to the Administrative Agent); (d) commercial paper
(foreign and domestic) or master notes, other than commercial paper or master
notes issued by the Borrower or any of its Affiliates, and, at the time of
acquisition, having a long-term rating of at least A or the equivalent from
S&P, Moody’s or Fitch and having a short-term rating of at least A-1 and
P-1 from S&P and Moody’s, respectively (or, if at any time neither S&P
nor Moody’s shall be rating such obligations, then the highest rating from such
other nationally recognized rating services acceptable to the Administrative
Agent); (e) domestic and foreign certificates of deposit or domestic time
deposits or foreign deposits or bankers’ acceptances (foreign or domestic) in
Dollars that are issued by a bank (I) which has, at the time of
acquisition, a long-term rating of at least A or the equivalent from S&P,
Moody’s or Fitch and


 


5

















 


(II) if a
domestic bank, which is a member of the Federal Deposit Insurance Corporation; (f) overnight
securities repurchase agreements, or reverse repurchase agreements secured by
any of the foregoing types of securities or debt instruments; provided
that the collateral supporting such repurchase agreements shall have a value
not less than 101% of the principal amount of the repurchase agreement plus
accrued interest; and (g) money market funds invested in investments
substantially all of which consist of the items described in clauses (a) through
(f) foregoing.


 


“Cash Flow Projections” means cash
flow projections of the Borrower and its Consolidated Subsidiaries
substantially in the form of Exhibit B.


 


“Closing Date” means the date on or
after the Effective Date on which the conditions set forth in Section 3.1
shall have been satisfied to the satisfaction of the Administrative Agent.


 


“Code” means the Internal Revenue Code
of 1986, as amended, and as it may be further amended from time to time, any
successor statutes thereto, and applicable U.S. Department of Treasury
regulations issued pursuant thereto in temporary or final form.


 


“Collateral” means all Eligible Assets
of the Collateral SPVs, now owned or hereafter acquired, upon which a Lien is
purported to be created by the Collateral Documents.


 


“Collateral Documents” means the
Security Agreement, the Collateral Trust Agreement, the Mortgages and all other
security documents hereafter delivered to the Administrative Agent and/or the
Collateral Trustee granting a Lien on any property of any Person to secure the
obligations and liabilities of the Borrower or any Guarantor under any Loan
Document.


 


“Collateral LLC” means any Subsidiary,
other than a Collateral SPV, of the Borrower that owns Loan Assets, Credit
Tenant Lease Assets, Other Real Estate Owned Assets or interests in Venture
LLCs, in each case, the equity interests in which are directly and wholly owned
by one or more Collateral SPVs.


 


“Collateral LLC Deposit Account” has
the meaning set forth in Section 5.8(a).


 


“Collateral Report” means the report
delivered pursuant to Section 5.1(l), substantially in the form of Exhibit D.


 


“Collateral SPV” means iStar Tara
Holdings LLC, iStar Tara LLC or any other special purpose entity of the
Borrower formed to own and hold Collateral, in each case (other than with
respect to iStar Tara Holdings LLC), the equity interests in which are directly
and wholly owned by iStar Tara Holdings LLC or iStar Tara LLC.


 


“Collateral SPV Deposit Account” has
the meaning set forth in Section 5.8(a).


 


“Collateral Trust Agreement” means the
Collateral Trust and Intercreditor Agreement dated as the date hereof, between
iStar Tara Holdings LLC, iStar Tara LLC, certain Subsidiaries of the Borrower,
JPMorgan Chase Bank, N.A., as the first priority agent, the 2011 second
priority agent and the 2012 second priority agent, and the Collateral Trustee,
substantially


 


6

















 


in the form of Exhibit E, as the same
may be amended, modified or supplemented from time to time.


 


“Collateral Trustee” means The Bank of
New York Mellon Trust Company, N.A., as collateral trustee under the Collateral
Documents, or any successor collateral trustee pursuant to the terms of the
Collateral Documents.


 


“Commitment”
means with respect to each Bank, such Bank’s Revolving Credit Commitment and
Term Loan Commitment, as the context may require.


 


 “Consolidated
Subsidiary” means at any date (i) any Collateral SPV, (ii) any
Collateral LLC and (iii) any other Subsidiary or other entity which is
consolidated with the Borrower in accordance with GAAP.


 


“Consolidated Tangible Net Worth”
means, at any time, the tangible net worth of the Borrower, on a consolidated
basis, determined in accordance with GAAP.


 


“Consulting Bank” has the meaning set
forth in Section 2.23(b).


 


“Contingent
Obligation” as to any Person means, without duplication, (i) any
contingent obligation of such Person required to be shown on such Person’s
balance sheet in accordance with GAAP which is not otherwise Indebtedness, and (ii) any
obligation required to be disclosed in accordance with GAAP in the footnotes to
such Person’s financial statements, guaranteeing partially or in whole any
Non-Recourse Indebtedness, lease, dividend or other obligation, exclusive of
contractual indemnities (including, without limitation, any indemnity or
price-adjustment provision relating to the purchase or sale of securities or
other assets) and guarantees of non-monetary obligations (other than guarantees
of completion) which have not yet been called on or quantified, of such Person
or of any other Person.  The amount of
any Contingent Obligation described in clause (ii) shall be deemed to be (a) with
respect to a guaranty of interest or interest and principal, or operating
income guaranty, the Net Present Value of the sum of all payments required to
be made thereunder (which in the case of an operating income guaranty shall be
deemed to be equal to the debt service for the note secured thereby), through (i) in
the case of an interest or interest and principal guaranty, the stated date of
maturity of the obligation (and commencing on the date interest could first be
payable thereunder), or (ii) in the case of an operating income guaranty,
the date through which such guaranty will remain in effect, and (b) with
respect to all guarantees not covered by the preceding clause (a), an amount
equal to the stated or determinable amount of the primary obligation in respect
of which such guaranty 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 the Borrower required to
be delivered pursuant to Section 5.1 hereof. Notwithstanding anything
contained herein to the contrary, guarantees of completion shall not be deemed
to be Contingent Obligations unless and until a claim for payment or
performance has been made thereunder, at which time any such guaranty of
completion shall be deemed to be a Contingent Obligation in an amount equal to
any such claim.  Subject to the preceding
sentence, (i) in the case of a joint and several guaranty given by such
Person and another Person (but only to the extent such guaranty is recourse,
directly or indirectly to the Borrower), the amount of the


 


7

















 


guaranty shall
be deemed to be 100% thereof unless and only to the extent that such other
Person has delivered Cash or Cash Equivalents to secure all or any part of such
Person’s guaranteed obligations, (ii) in the case of joint and several
guarantees given by a Person in whom the Borrower owns an interest (which
guarantees are non-recourse to the Borrower), to the extent the guarantees, in
the aggregate, exceed 15% of total asset value, the amount which is the lesser
of (x) the amount in excess of 15% or (y) the amount of the
Borrower’s interest therein shall be deemed to be a Contingent Obligation of
the Borrower, and (iii) in the case of a guaranty (whether or not joint
and several) of an obligation otherwise constituting Indebtedness of such
Person, the amount of such guaranty shall be deemed to be only that amount in
excess of the amount of the obligation constituting Indebtedness of such
Person. All matters constituting “Contingent Obligations” shall be calculated
without duplication.


 


“Coverage Ratio” means at any time the
ratio of (A) the aggregate Borrowing Base Value of the Collateral in which
the Collateral Trustee has a first priority, perfected security interest (other
than any Permitted Liens described in clause (a), (b) or (f) of the
definition thereof set forth herein) to (B) the sum of (i) the
aggregate principal amount of all loans and the aggregate undrawn amount of all
letters of credit outstanding and unpaid letter of credit reimbursement
obligations under the Secured Bank Facilities, (ii) the aggregate
principal amount of Second Priority Secured Exchange Notes outstanding (if
any), and (iii) the aggregate amount of all Discounts realized by the
Borrower prior to such time; provided  that for purposes of
calculating the Coverage Ratio, the Borrower may use Borrowing Base Values as
of the end of the most recently ended Fiscal Quarter, with adjustments for (x) any
payments or prepayments of principal of the Loan Assets, (y) the cash
proceeds of any sales or other realizations on account of Credit Tenant Lease
Assets and Other Real Estate Owned Assets included, or effectively included, in
the Collateral and (z) any withdrawals from, additions to or increased
fundings in respect of, the Collateral.


 


“Coverage Test” has the meaning set
forth in Section 5.17.


 


“Credit Rating” means a rating
assigned by a Rating Agency to the Borrower’s senior unsecured long term
indebtedness.


 


“Credit Tenant Lease Assets” means
properties substantially all of which are either (i) leased to a
governmental entity, (ii) leased to a tenant (or guaranteed by a Person)
with an Investment Grade Rating, (iii) properties which, if unavailable to
a tenant, would materially impair the continued operation of such tenant,
including without limitation, headquarters facilities, distribution centers,
manufacturing facilities, or pools or classes of multiple properties leased
under blanket leases or (iv) any other assets that the Borrower has
classified as a credit tenant lease consistent with past practice.  In addition, “Credit Tenant Lease Assets”
will be leased to such corporate users primarily on a triple net basis, but may
also be leased on a double net, gross lease with expense stop, or bond-type
basis.


 


“DB Master Repurchase Agreement” means
the Amended and Restated Master Repurchase Agreement dated as of January 9,
2006, as amended, by and among iStar DB Seller, LLC, as seller, Deutsche Bank
AG, Cayman Islands Branch, as buyer, and the Borrower, as sponsor.


 


8






 












 


“Debt Service” means, for any period
and without duplication, Interest Expense for such period on all Indebtedness
of the Borrower on a consolidated basis.


 


“Default” means any condition or event
which with the giving of notice or lapse of time or both would, unless cured or
waived, become an Event of Default.


 


“Default Rate” has the meaning set
forth in Section 2.8(c).


 


“Defaulting Bank” means any Bank, as
reasonably determined by the Administrative Agent, that has (a) failed to
fund any portion of its Loans under this Agreement or loans under either the
2012 Second Priority Credit Agreement or the First Priority Credit Agreement
within three Business Days of the date required to be funded by it hereunder or
thereunder, as applicable, unless the subject of a good faith dispute (b) notified
the Borrower, the Administrative Agent, or any Bank, or as applicable, the
administrative agent or any lender under either the 2012 Second Priority Credit
Agreement or the First Priority Credit Agreement, in writing, or made a public
statement, that it does not intend or is not able to comply with any of its
funding obligations under this Agreement or under either the 2012 Second
Priority Credit Agreement or the First Priority Credit Agreement, (c) failed,
within three Business Days after written request by the Administrative Agent,
or as applicable, the administrative agent under either the 2012 Second
Priority Credit Agreement or the First Priority Credit Agreement, to confirm
that it will comply with the terms of this Agreement or either the 2012 Second
Priority Credit Agreement or the First Priority Credit Agreement relating to
its obligations to fund prospective Loans or loans under either the 2012 Second
Priority Credit Agreement or the First Priority Credit Agreement, or (d) otherwise
failed to pay over to the Administrative Agent or any other Bank any other
amount required to be paid by it hereunder within three Business Days of the
date when due, unless the subject of a good faith dispute; provided, however,
in each case, at any time such failure is remedied or notice retracted, such
Bank shall no longer be a Defaulting Bank.


 


“Deposit
Account Control Agreement” means, individually and collectively, each “Deposit
Account Control Agreement” referred to in the Security Agreement.


 


“Discount” means, with respect to any
prepayment of loans outstanding under the Secured Bank Facilities or any
repurchase of Second Priority Secured Exchange Notes, the excess of (x) the
par principal amount of such loans prepaid or such Second Priority Secured
Exchange Notes repurchased, as applicable, over (y) the discounted
prepayment amount or purchase price, as applicable, with respect to such
prepayment or repurchase.


 


“Dollar Equivalent Amount” means (i) with
respect to any amount of Alternate Currency on any day, the equivalent amount
in Dollars of such amount of Alternate Currency as determined by the
Administrative Agent using the applicable Exchange Rate on such day and (ii) with
respect to any amount of Dollars, such amount.


 


“Dollar Revolving Credit Commitment”
means with respect to each Bank, the amount set forth on Schedule 1.1A
next to the name of such Bank as such Bank’s “Dollar Revolving Credit
Commitment” (and, for each Bank which is an Assignee, the amount set forth in
the Transfer Supplement entered into pursuant to Section 9.6(c) as
the Assignee’s Dollar 


 


9

















 


Revolving
Credit Commitment), as such amount may be reduced or increased from time to
time in connection with any assignment pursuant to Section 9.6 or reduced
in accordance with the terms of this Agreement. 
The initial aggregate amount of the Banks’ Dollar Revolving Credit
Commitments is $87,400,000.


 


“Dollar Revolving Credit Facility”
means the Dollar Revolving Credit Commitments and the Dollar Revolving Credit
Loans made thereunder.


 


“Dollar Revolving Credit Loan” means a
revolving loan made by a Bank in Dollars pursuant to Section 2.2
attributable to such Bank’s Dollar Revolving Credit Commitment, as well as
loans required to be made by a Bank pursuant to Section 2.19 to reimburse
a Fronting Bank for a Letter of Credit attributable to the Dollar Revolving
Credit Commitments that has been drawn down; provided that, if any such loan or
loans (or portions thereof) are combined or subdivided pursuant to a Notice of
Interest Rate Election, the term “Dollar Revolving Credit Loan” shall
refer to the combined principal amount resulting from such combination or to
each of the separate principal amounts resulting from such subdivision, as the
case may be.


 


“Dollars” and “$” means the
lawful money of the United States.


 


“Domestic Lending Office” means, as to
each Bank, its office located at its address in the United States set forth in
its Administrative Questionnaire (or identified in its Administrative
Questionnaire as its Domestic Lending Office) or such other office as such Bank
may hereafter designate as its Domestic Lending Office by notice to the
Borrower and the Administrative Agent.


 


“EBITDA” means, for any period on a
consolidated basis in accordance with GAAP (i) Net Income for such period,
plus (ii) depreciation, depletion and amortization expense and other
non-cash items deducted in the calculation of Net Income for such period, plus (iii) Interest
Expense deducted in the calculation of Net Income for such period, plus (iv) dividends
and distributions from the Borrower’s Investment Affiliates (exclusive of
returns of equity), minus (v) income from any Investment Affiliates, minus
(vi) gains and losses from discontinued operations, all of the foregoing
without duplication. Notwithstanding the foregoing, however, in the case of any
asset that is less than 100% owned, directly or indirectly, by the Borrower,
only the Borrower’s pro rata share of the items set forth in clauses (i), (ii),
(iii) and (vi) shall be included in EBITDA.


 


“Effective Date” means the date this
Agreement becomes effective in accordance with Section 9.8.


 


“Eligible Assets” means Performing
Loan Assets, Non-Performing Loan Assets and the equity interests in Collateral
LLCs.


 


“Environmental Affiliate” means any
partnership, joint venture, trust or corporation in which an equity interest is
owned directly or indirectly by the Borrower and, as a result of the ownership
of such equity interest, the Borrower may have recourse liability for
Environmental Claims against such partnership, joint venture, trust or
corporation (or the property thereof).


 


10

















 


“Environmental Claim” means, with
respect to any Person, any notice, claim, demand or similar communication
(written or oral) by any other Person alleging potential liability of such
Person for investigatory costs, cleanup costs, governmental response costs,
natural resources damage, property damages, personal injuries, fines or
penalties arising out of, based on or resulting from (i) the presence, or
release into the environment, of any Materials of Environmental Concern at any
location, whether or not owned by such Person or (ii) circumstances
forming the basis of any violation, or alleged violation, of any Environmental
Law, in each case (with respect to both (i) and (ii) above) as to
which there is a reasonable possibility of an adverse determination with
respect thereto and which, if adversely determined, would have a Material
Adverse Effect on the Borrower.


 


“Environmental Laws” means any and all
federal, state, and local statutes, laws, judicial decisions, regulations,
ordinances, rules, judgments, orders, decrees, plans, injunctions, permits,
concessions, grants, licenses, agreements and other governmental restrictions
relating to the environment, the effect of the environment on human health or
to emissions, discharges or releases of Materials of Environmental Concern into
the environment including, without limitation, ambient air, surface water,
ground water, or land, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of
Materials of Environmental Concern or the cleanup or other remediation thereof.


 


“ERISA” means the Employee Retirement
Income Security Act of 1974, as amended, or any successor statute.


 


“ERISA Group” means the Borrower, any
Subsidiary, and all members of a controlled group of corporations and all
trades or businesses (whether or not incorporated) under common control and all
members of an “affiliated service group” which, together with the Borrower, or
any Subsidiary, are treated as a single employer under Section 414 of the
Code or Section 4001(b)(1) of ERISA.


 


“Euro-Currency Borrowing” means a
Borrowing comprised of Euro-Currency Loans.


 


“Euro-Currency Business Day” means any
Business Day on which banks are open for dealings in deposits in Dollars in the
London interbank market and any day on which commercial banks are open for
foreign exchange business in (i) London, or (ii) if such reference
relates to the date on which any amount is to be paid or made available in an
Alternate Currency, the principal financial center in the country of such
Alternate Currency, except that with respect to Euros, the same shall mean a
TARGET Day.


 


“Euro-Currency Lending Office” means,
as to each Bank, its office, branch or affiliate located at its address set
forth in its Administrative Questionnaire (or identified in its Administrative
Questionnaire as its Euro-Currency Lending Office) or such other office, branch
or affiliate of such Bank as it may hereafter designate as its Euro-Currency
Lending Office by notice to the Borrower and the Administrative Agent.


 


11

















 


“Euro-Currency Loan” means a Loan made
or to be made by a Bank in accordance with the applicable Notice of Borrowing,
the interest on which is calculated by reference to the Euro-Currency Rate.


 


“Euro-Currency Rate” means with
respect to any Interest Period applicable to a Euro-Currency Loan, an interest
rate per annum obtained by dividing (i) the Base Euro-Currency Rate
applicable to that Interest Period by (ii) a percentage equal to 100% minus
the Euro-Currency Reserve Percentage in effect.


 


“Euro-Currency Reserve Percentage”
means, for any day, that percentage (expressed as a decimal) which is in effect
on such day, as prescribed by the Federal Reserve Board (or any successor)
under Regulation D, as Regulation D may be amended, modified or supplemented,
for determining the maximum reserve requirement for a member bank of the
Federal Reserve System in New York City with deposits exceeding $5,000,000,000
in respect of “Eurocurrency liabilities” (or in respect of any other category
of liabilities which includes deposits by reference to which the interest rate
on Euro-Currency Loans is determined or any category of extensions of credit or
other assets which includes loans by a non-United States office of any Bank to
United States residents).


 


“Event of Default” has the meaning set
forth in Section 6.1.


 


“Exchange Option Termination” means
the termination of the Borrower’s option to issue Second Priority Exchange
Notes which shall result from the delivery, at any time, by the Borrower of
written notice to the Administrative Agent of its determination not to issue
any, or any additional, Second Priority Secured Exchange Notes.


 


“Exchange Rate” means, (i) the
rate appearing on the relevant display page (as determined by the
Administrative Agent) on the Reuters Monitor Money Rates Service for the sale
of the applicable Alternate Currency for Dollars in the London foreign exchange
market at approximately 11:00a.m. (London time) for delivery two (2) Euro-Currency
Business Days later or if not available (ii) the spot selling rate at
which the Administrative Agent offers to sell such Alternate Currency for
Dollars in the London foreign exchange 
market at approximately 11:00a.m. (London time) for delivery two
Euro-Currency Business Days later; provided, however, that if, at the time of
any such determination, no such spot rate can reasonably be quoted, the
Administrative Agent may use any reasonable method (including obtaining quotes
from two (2) or more market makers for the applicable Alternate Currency)
as it deems appropriate to determine such rate, and such determination shall be
conclusive absent manifest error.


 


“Existing Credit Agreements” means the
Existing 2006 Credit Agreement and the Existing 2007 Credit Agreement.


 


“Existing Letters of Credit” means the
letters of credit outstanding on the Closing Date and set forth on
Schedule 1.1B.


 


“Existing 2006 Credit Agreement” means
the Amended and Restated Revolving Credit Agreement dated as of June 28,
2006, as amended, by and among the Borrower, the lenders party thereto and
JPMorgan Chase Bank, N.A. as administrative agent.


 


12

















 


“Existing 2006 Credit Agreement Amendment
and Commitment Transfer Agreement” means the Amendment and Commitment
Transfer Agreement in respect of the Existing 2006 Credit Agreement dated as of
March 13, 2009, among the Borrower and JPMorgan Chase Bank, N.A., as
administrative agent, and consented to by the Required Banks (as defined in the
Existing 2006 Credit Agreement).


 


“Existing 2007 Credit Agreement” means
the Revolving Credit Agreement, dated as of June 26, 2007, as amended, by
and among the Borrower, the lenders party thereto and JPMorgan Chase Bank, N.A.
as administrative agent.


 


“Existing 2007 Credit Agreement Amendment
and Commitment Transfer Agreement” means the Amendment and Commitment
Transfer Agreement in respect of the Existing 2007 Credit Agreement dated as of
March 13, 2009 among the Borrower and JPMorgan Chase Bank, N.A., as
administrative agent, and consented to by the Required Banks (as defined in the
Existing 2007 Credit Agreement).


 


“Existing 2008 Credit Agreement” means
the 364-Day Term Loan Agreement dated as of March 10, 2008, as amended,
among iStar Corporate Collateral LLC, as borrower, the Borrower, as guarantor,
JPMorgan Chase Bank, N.A., as administrative agent, and the other parties
thereto.


 


“Existing 2008 Credit Agreement Amendments”
means the (i) Amendment Agreement in respect of the Existing 2008 Credit
Agreement dated as of February 23, 2009 and (ii) the Second Amendment
Agreement in respect of the Existing 2008 Credit Agreement to be entered into
on or prior to March 13, 2009, in each case among iStar Corporate
Collateral LLC, the Borrower, the lenders party thereto and JPMorgan Chase
Bank, N.A., as administrative agent.


 


“Federal Funds Rate” means, for any
day, the rate per annum (rounded upward, if necessary, to the nearest 1/100th
of 1%) equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published by the Federal Reserve Bank of New York
on the Business Day next succeeding such day; provided that (i) if
such day is not a Business Day, the Federal Funds Rate for such day shall be
such rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day, and (ii) if no such rate is
so published on such next succeeding Business Day, the Federal Funds Rate for
such day shall be the average rate quoted to the Administrative Agent on such
day for such transactions as determined by the Administrative Agent.


 


“Federal Reserve Board” means the
Board of Governors of the Federal Reserve System as constituted from time to
time.


 


“First Priority Credit Agreement”
means the $1,000,000,000 First Priority Credit Agreement, dated as of the date
hereof, as amended, supplemented or otherwise modified from time to time, by
and among the Borrower, the lenders party thereto, and JPMorgan Chase Bank,
N.A., as administrative agent.


 


13

















 


“First Priority Secured Parties” has
the meaning set forth in the Collateral Trust Agreement.


 


“Fiscal Quarter” means a fiscal
quarter of a Fiscal Year.


 


“Fiscal Year” means the fiscal year of
the Borrower.


 


“Fitch” means Fitch Investors Services, Inc.,
or any successor thereto.


 


“Fixed Charge Coverage Ratio” means at
any time the ratio of EBITDA to Fixed Charges, for the then most recently
completed four (4) consecutive Fiscal Quarters.


 


“Fixed Charge Coverage Ratio Payment Event”
means any time and for so long as the Fixed Charge Coverage Ratio is less than
1.25 to 1.00.


 


“Fixed Charges” for any Fiscal Quarter
period means the sum of (i) Debt Service for such period, and (ii) dividends
on preferred units payable by the Borrower for such period.  If any of the foregoing Debt Service is with
respect to Indebtedness that is subject to an interest rate cap agreement
purchased by the Borrower or a Consolidated Subsidiary, the interest rate shall
be assumed to be the lower of the actual interest payable on such Indebtedness
or the capped rate of such interest rate cap agreement.


 


“Fremont Assets” means the assets
subject to the Fremont Participation Agreement.


 


“Fremont Participation Agreement”
means the Loan Participation Agreement, dated as of May 21, 2007,
originally by and among Fremont Investment & Loan and iStar FM Loans
LLC, as amended, supplemented or otherwise modified from time to time.


 


“Fronting Bank” means (i) JPMorgan
Chase Bank, N.A., (ii) Wachovia Bank National Association, as the issuer
of the Existing Letter of Credit WACHOVIA136281 and (iii) each other Bank
that shall consent thereto as may be designated by the Borrower from time to
time.


 


“GAAP” means generally accepted accounting
principles in the United States recognized as such in the opinions and
pronouncements of the Accounting Principles Board and the American Institute of
Certified Public Accountants and the Financial Accounting Standards Board or in
such other statements by such other entity as may be approved by a significant
segment of the accounting profession, which are applicable to the circumstances
as of the date of determination.


 


“GE Credit Tenant Lease Facility”
means collectively, (a) the loans made to American Financial Exchange LLC
pursuant to a certain Loan Agreement dated as of June 26, 2008 among
American Financial Exchange LLC, the lenders party thereto and General Electric
Capital Corporation, as Administrative Agent (as amended from time to time) and
(b) the loans made to iStar CTL Finance LLC pursuant to a certain Loan
Agreement dated as of April 30, 2008 among iStar CTL Finance LLC, the
lenders party thereto and General Electric Capital 


 


14

















 


Corporation,
as Administrative Agent (as amended from time to time), as such Loan Agreements
have been or are amended from time to time.


 


“Grantor” means each of the Collateral
SPVs that is a party to the Security Agreement.


 


“Group of Loans” means, at any time, (i) a
group of Term Loans consisting of (x) all Term Loans which are Base Rate
Loans at such time, or (y) all Term Loans which are Euro-Currency Loans
having the same Interest Period at such time or (ii) a group of Revolving
Credit Loans consisting of (x) in the case of Revolving Credit Loans in
Dollars, all Revolving Credit Loans which are Base Rate Loans at such time, or (y) all
Revolving Credit Loans which are Euro-Currency Loans having the same Interest
Period at such time; provided that, in each case, if a Loan of any
particular Bank is converted to or made as a Base Rate Loan pursuant to Section 8.2
or Section 8.5, such Loan shall be included in the same Group or Groups of
Loans from time to time as it would have been in if it had not been so
converted or made.


 


“Guarantee Agreement” means the 2011
Second Priority Guarantee Agreement dated as of the date hereof entered into by
each Guarantor, substantially in the form of Exhibit F, as the same may be
amended, modified or supplemented from time to time.


 


“Guarantors” means each of the
Collateral SPVs and the Collateral LLCs that, in each case, is party to the
Guarantee Agreement and other such guarantors as may from time to time be
added, by a supplement to the Guarantee Agreement in a form reasonably satisfactory
to the Administrative Agent.


 


“Indebtedness” as applied to any
Person, means, at any time, without duplication, (a) all indebtedness,
obligations or other liabilities of such Person (whether consolidated or
representing the proportionate interest in any other Person) (i) for
borrowed money (including construction loans) or evidenced by debt securities,
debentures, acceptances, notes or other similar instruments, and any accrued
interest, fees and charges relating thereto, (ii) under profit payment agreements
or in respect of obligations to redeem, repurchase or exchange any Securities
of such Person or to pay dividends in respect of any stock, (iii) with
respect to letters of credit issued for such Person’s account, (iv) to pay
the deferred purchase price of property or services, except accounts payable
and accrued expenses arising in the ordinary course of business, (v) in
respect of Capital Leases, (vi) which are Contingent Obligations or (vii) under
warranties and indemnities; (b) all indebtedness, obligations or other
liabilities of such Person or others secured by a Lien on any property of such
Person, whether or not such indebtedness, obligations or liabilities are
assumed by such Person, all as of such time (provided that the value of
such indebtedness, obligations or liabilities shall be limited to the lesser of
(x) the amount of such indebtedness, obligations or liabilities assumed by
such Person and (y) the undepreciated book value of the property subject
to such Lien, determined in accordance with GAAP, and less any impairment
charge; provided, further, however, that if the amount of such
indebtedness, obligations or liabilities are greater than 90% of such
undepreciated book value of the encumbered property when assumed or incurred,
then, if the Borrower intends to apply the provisions of this proviso thereto,
the Borrower shall deliver an appraisal prepared by an independent appraiser to
the Administrative Agent with respect to the value of the applicable property);
(c) all indebtedness, obligations or other liabilities of such Person in
respect of Interest 


 


15

















 


Rate Contracts
and foreign exchange contracts, net of liabilities owed to such Person by the
counterparties thereon; (d) all preferred stock subject (upon the
occurrence of any contingency or otherwise) to mandatory redemption; and (e) all
contingent contractual obligations with respect to any of the foregoing.


 


“Indemnitee” has the meaning set forth
in Section 9.3(b).


 


“Interest Expense” means, for any
period and without duplication, total interest expense, whether paid, accrued
or capitalized, of the Borrower, on a consolidated basis determined in
accordance with GAAP.


 


“Interest Period” means with respect
to each Euro-Currency Borrowing, the period commencing on the date of such
Borrowing specified in the Notice of Borrowing or on the date specified in the
applicable Notice of Interest Rate Election and ending 1, 2 or 3 months
thereafter as the Borrower may elect in the applicable Notice of Borrowing or
Notice of Interest Rate Election; provided, that:


 


(a)  any Interest Period
which would otherwise end on a day which is not a Euro-Currency Business Day
shall be extended to the next succeeding Euro-Currency Business Day unless such
Euro-Currency Business Day falls in another calendar month, in which case such
Interest Period shall end on the immediately preceding Euro-Currency Business
Day;


 


(b)  any Interest Period
which begins on the last Euro-Currency 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 Euro-Currency
Business Day of a calendar month; and


 


(c)  no Interest Period
may end later than the Maturity Date.


 


“Interest Rate Contracts” means,
collectively, interest rate swap, collar, cap or similar agreements providing
interest rate protection.


 


“Investment Affiliate” means any joint
venture or Subsidiary, whose financial results are not consolidated under GAAP
with the financial results of the Borrower on the consolidated financial
statements of the Borrower.


 


“Investment Grade Rating” means a
rating for a Person’s senior long-term unsecured debt of BBB- or better from
S&P or of Baa3 or better from Moody’s. 
In the event that the Borrower receives Credit Ratings from S&P and
Moody’s, and such Credit Ratings are not equivalent, the lower of such two (2) Credit
Ratings shall be used to determine whether an Investment Grade Rating was
achieved.


 


“Joint Bookrunners” means J.P. Morgan
Securities Inc., Banc of America Securities LLC and Citigroup Global Markets
Inc., in their respective capacities as Joint Bookrunners hereunder.


 


16

















 


“Joint Lead Arrangers” means J.P. Morgan
Securities Inc., Banc of America Securities LLC and Citigroup Global Markets
Inc., in their respective capacities as Joint Lead Arrangers hereunder.


 


“Junior Priority Secured Exchange Notes”
means Secured Exchange Notes which are secured by a third or more junior
priority security interest in the Collateral.


 


“Letter(s) of Credit” means any
Existing Letter of Credit or any letter of credit issued hereunder.


 


“Letter of Credit Collateral” has the
meaning provided in Section 6.4.


 


“Letter of Credit Collateral Account”
has the meaning provided in Section 6.4.


 


“Letter of Credit Documents” has the
meaning provided in Section 2.20.


 


“Letter of Credit Usage” means at any
time the sum of the Dollar Equivalent Amount of (i) the aggregate maximum
amount available to be drawn under the Letters of Credit then outstanding,
assuming compliance with all requirements for drawing referred to therein, and (ii) the
aggregate amount of the Borrower’s unpaid obligations under this Agreement in
respect of the Letters of Credit.


 


“Lien” means, with respect to any
asset, any mortgage, lien, pledge, charge, security interest or encumbrance of
any kind, or any other type of preferential arrangement, in each case that has
the effect of creating a security interest in respect of such asset.  For the purposes of this Agreement, the
Borrower or any Consolidated Subsidiary shall be deemed to own subject to a
Lien any asset which it has acquired or holds subject to the interest of a
vendor or lessor under any conditional sale agreement, capital lease or other
title retention agreement relating to such asset.


 


“Listed Eligible Assets” means the
Eligible Assets included on the ranked list set forth on Schedule 1.1C, as such
Schedule may be updated and as such list may be re-ranked or otherwise modified
in accordance with the terms of this Agreement.


 


“Listed Eligible Asset Payment Event”
means after a Principal Collateral Payment has been made in respect of certain
Collateral, any time and for so long as the aggregate Borrowing Base Value of
all Listed Eligible Assets is not sufficient to replace the Collateral in
respect of which such Principal Collateral Payment has been made for purposes
of compliance with the applicable Coverage Test.


 


“Loan” means a Term Loan, a Revolving
Credit Loan or a Swingline Loan, and “Loans” means Term Loans, Revolving
Credit Loans or Swingline Loans or any combination of the foregoing.


 


“Loan Assets” means senior or
subordinated loans that may be either fixed or variable rate, including,
without limitation, first mortgages, second mortgages, mezzanine loans,
repurchase agreements, participations in loans, interim facilities, corporate
loans, debt securities, “B” notes and collateralized mortgage-backed
securities.


 


17

















 


“Loan Documents” means this Agreement,
any Note, the Guarantee Agreement, any Letter of Credit, any Letter of Credit
Document and each Collateral Document.


 


“Loan Parties” means the Borrower and
each Guarantor.


 


“Mandatory Borrowing” has the meaning
set forth in Section 2.4(b)(iii).


 


“Material Adverse Effect” means an
effect resulting from any circumstance or event or series of circumstances or
events, of whatever nature (but excluding general economic conditions), which
does or could reasonably be expected to, materially and adversely impair (i) the
ability of the Borrower and its Consolidated Subsidiaries, taken as a whole, to
perform their respective obligations under the Loan Documents, or (ii) the
ability of the Administrative Agent or the Banks to enforce the Loan Documents.


 


“Material Default” means (i) any
Default resulting from the Borrower’s failure to pay any principal of any Loan
hereunder, including any mandatory prepayment hereunder, or any interest due on
any Loan or any fees or other amount payable hereunder, (ii) any Default
resulting from the Borrower’s failure to be in compliance with any covenant
contained in Section 5.1(a), (b), (c), 5.1(d)(i) (provided that the
officer of the Borrower that, in such case, has obtained knowledge of the applicable
Default or Event of Default is any of the president, chief executive officer,
chief financial officer or chief operating officer of the Borrower or any
officer performing the customary duties of any such position), (k), (l), Section 5.8,
Section 5.10, Section 5.14, Section 5.17, including on a pro
forma basis after giving effect to any relevant transaction or (iii) any
other material Default as to which the Borrower shall have received written
notice.


 


“Materials of Environmental Concern”
means and includes pollutants, contaminants, hazardous wastes, toxic and
hazardous substances, asbestos, lead, petroleum and petroleum by-products.


 


“Maturity Date” means the date when
all of the Obligations hereunder shall be due and payable which shall be June 28,
2011, unless otherwise accelerated pursuant to the terms hereof.


 


“Moody’s” means Moody’s Investors
Services, Inc. or any successor thereto.


 


“Mortgage-Eligible Assets” means
Credit Tenant Lease Assets owned by Pledged Collateral LLCs other than the Mortgage-Exempt
Assets.


 


“Mortgage-Exempt Asset” means (i) at
any time, any Credit Tenant Lease Asset owned by (a) iStar Bowling Centers
I LP, (b) iStar Bowling Centers II LP or (c) any Venture LLC, and (ii) each
of the following Credit Tenant Lease Assets commonly known as (a) Sky
Chefs I, (b) Sky Chefs II, (c) Fresenius USA or (d) Cequent
Towing Products, in each case, unless the binding contract, as in effect on the
Closing Date, for a Third Party Sale of its owned real property is terminated
prior to consummation; provided, however, that the Borrower may, at any time,
by written notice to the Joint Lead Arrangers, remove any such Credit Tenant
Lease Asset from the list of Mortgage-Exempt Assets and thereafter the related
real property shall be eligible to become a Mortgaged Property in accordance
with Section 2.24.


 


18
















 


“Mortgaged Properties” means the real
properties as to which the Collateral Trustee for the benefit of the Secured
Parties shall be granted a Lien pursuant to the Mortgages as required by and in
accordance with Section 2.24.


 


“Mortgages” means each of the real
property mortgages and deeds of trust made by any Pledged Collateral LLC in
favor of, or for the benefit of, the Collateral Trustee, for the benefit of the
Secured Parties, substantially in the form of Exhibit J (with such changes
thereto as shall be advisable under the law of the jurisdiction in which such
real property mortgage or deed of trust is to be recorded to the extent such
changes do not increase the obligations of any Loan Party and do not decrease
the rights of any Loan Party or otherwise modify the substantive and remedial
provisions of the Mortgages).


 


“Multicurrency Revolving Credit Commitment”
means with respect to each Bank, the amount set forth on Schedule 1.1A
next to the name of such Bank as such Bank’s “Multicurrency Revolving Credit
Commitment” (and, for each Bank which is an Assignee, the amount set forth in
the Transfer Supplement entered into pursuant to Section 9.6(c) as
the Assignee’s Multicurrency Revolving Credit Commitment), as such amount may
be reduced or increased from time to time in connection with any assignment
pursuant to Section 9.6 or reduced in accordance with the terms of this
Agreement.  The initial aggregate amount
of the Banks’ Multicurrency Revolving Credit Commitments is $552,600,000.


 


“Multicurrency Revolving Credit Facility”
means the Multicurrency Revolving Credit Commitments and the Multicurrency
Revolving Credit Loans made thereunder.


 


“Multicurrency Revolving Credit Loan”
means a revolving loan made by a Bank in an Alternate Currency or Dollars, as
applicable, pursuant to Section 2.2 attributable to such Bank’s
Multicurrency Revolving Credit Commitment, as well as loans required to be made
by a Bank pursuant to Section 2.19 to reimburse a Fronting Bank for a
Letter of Credit attributable to the Multicurrency Revolving Credit Commitments
that has been drawn down; provided that, if any such loan or loans (or portions
thereof) are combined or subdivided pursuant to a Notice of Interest Rate
Election, the term “Multicurrency Revolving Credit Loan” shall refer to
the combined principal amount resulting from such combination or to each of the
separate principal amounts resulting from such subdivision, as the case may be.


 


“Multicurrency Revolving Facility Amount”
has the meaning set forth in Section 2.2.


 


“Multiemployer Plan” means at any time
an employee pension benefit plan within the meaning of Section 4001(a)(3) of
ERISA to which any member of the ERISA Group is then making or accruing an
obligation to make contributions or has at any time after September 25,
1980 made contributions or has been required to make contributions (for these
purposes any Person which ceased to be a member of the ERISA Group after September 25,
1980 will be treated as a member of the ERISA Group).


 


“Net Income” means, for any period,
net income (or loss) of the Borrower for such period, calculated on a
consolidated basis in conformity with GAAP.


 


19

















 


“Net Present Value” means, as to a
specified or ascertainable Dollar amount, the present value, as of the date of
calculation of any such amount using a discount rate equal to the Base Rate in
effect as of the date of such calculation.


 


“Net Worth” means, at any time, the
sum of the Borrower’s (i) book equity, (ii) accumulated depreciation,
(iii) accumulated depletion, and (iv) reserves for loan losses, all
in accordance with GAAP and, in the case of items (ii), (iii) and (iv) hereof,
exclusive of amounts attributable to Investment Affiliates.


 


“Non-Excluded Taxes” has the meaning
set forth in Section 8.4.


 


“Non-Performing Loan Assets” means any
Loan Asset classified as non-performing in accordance with the Borrower’s
internal procedures, consistent with past practice.


 


“Non-Recourse Indebtedness” means
Indebtedness with respect to which recourse for payment is limited to (i) specific
assets related to a particular Property or group of Properties encumbered by a
Lien securing such Indebtedness or (ii) for all purposes other than Section 5.14
or Section 6.1(e) hereof, any Subsidiary (provided that if a
Subsidiary is a partnership, there is no recourse to the Borrower as a general
partner of such partnership); provided that if any portion of
Indebtedness is so limited, then such portion shall constitute Non-Recourse
Indebtedness and only the remainder of such Indebtedness shall constitute
Recourse Debt; provided, further, however, that personal
recourse of the Borrower for any such Indebtedness for fraud,
misrepresentation, misapplication of cash, waste, Environmental Claims and
liabilities and other circumstances customarily excluded by institutional
lenders from exculpation provisions and/or included in separate indemnification
agreements in non-recourse financing of real estate shall not, by itself,
prevent such Indebtedness from being characterized as Non-Recourse
Indebtedness.


 


“Notes” means the promissory notes of
the Borrower, substantially in the form of Exhibits G-1, G-2 and G-3 hereto,
respectively, evidencing the obligation of the Borrower to repay Term Loans,
Revolving Credit Loans and Swingline Loans, respectively and “Note” means any
one of such promissory notes issued hereunder.


 


“Notice of Borrowing” means a notice
from the Borrower in accordance with Section 2.3 or Section 2.4.


 


“Notice of Interest Rate Election” has
the meaning set forth in Section 2.7.


 


“Obligations” means all obligations,
liabilities, indemnity obligations and Indebtedness of every nature of the
Borrower, from time to time owing to the Administrative Agent, any other Agent
or any Bank under or in connection with this Agreement or any other Loan
Document.


 


“Other Real Estate Owned Assets” means
properties acquired by foreclosure or by deed-in-lieu of foreclosure in partial
or total satisfaction of Non-Performing Loan Assets.


 


“Other Taxes” has the meaning set
forth in Section 8.4.


 


20

















 


“Outstanding Secured Exposure” means,
on any date of determination, the aggregate principal amount of all loans and
reimbursement obligations and the aggregate undrawn amount of all letters of
credit outstanding under the Secured Bank Facilities on such date.


 


“Parent” means, with respect to any
Bank, any Person controlling such Bank.


 


“Participant” has the meaning set
forth in Section 9.6(b).


 


“Patriot Act” has the meaning set
forth in Section 9.15.


 


“PBGC” means the Pension Benefit
Guaranty Corporation or any entity succeeding to any or all of its functions
under ERISA.


 


“Performing Loan Assets” means any
Loan Assets other than Non-Performing Loan Assets.


 


“Permitted Liens” means:


 


(a)  Liens for Taxes,
assessments or other governmental charges not yet due and payable or which are
being contested in good faith by appropriate proceedings promptly instituted
and diligently conducted in accordance with the terms hereof;


 


(b)  statutory liens of
carriers, warehousemen, mechanics, materialmen and other similar liens imposed
by law, which are incurred in the ordinary course of business for sums not more
than ninety (90) days delinquent or which are being contested in good faith in
accordance with the terms hereof;


 


(c)  deposits or pledges
to secure the payment of worker’s compensation, unemployment insurance and
other social security or similar legislation or to secure liabilities to
insurance carriers or reimbursement and indemnity obligations in respect of
surety or appeal bonds;


 


(d)  utility deposits and
other deposits or pledges to secure the performance of bids, trade contracts
(other than for borrowed money), leases, purchase contracts, construction
contracts, governmental contracts, statutory obligations, surety bonds,
performance bonds and other obligations of a like nature incurred in the
ordinary course of business;


 


(e)  Liens for purchase
money obligations for equipment (or Liens to secure Indebtedness incurred
within 90 days after the purchase of any equipment to pay all or a portion of
the purchase price thereof or to secure Indebtedness incurred solely for the
purpose of financing the acquisition of any such equipment, or extensions,
renewals, or replacements of any of the foregoing for the same or lesser
amount); provided that (i) the Indebtedness secured by any such
Lien does not exceed the purchase price of such equipment, (ii) any such
Lien encumbers only the asset so purchased and the proceeds upon sale,
disposition, loss or destruction thereof, and (iii) such Lien, after
giving effect to the Indebtedness secured thereby, does not give rise to an
Event of Default;


 


21

















 


(f)  easements (including
reciprocal easement agreements and utility agreements), rights-of-way, zoning
restrictions, other covenants, reservations, encroachments, leases, licenses or
similar charges or encumbrances (whether or not recorded) and all other items
listed on any Schedule B to the Borrower’s owner’s title insurance policies,
except in connection with any Indebtedness, for any of the Borrower’s Real
Property Assets, so long as the foregoing do not interfere in any material
respect with the use or ordinary conduct of the business of the Borrower and do
not diminish in any material respect the value of the Property to which such
Permitted Lien is attached;


 


(g)  (I) Liens and
judgments which have been or will be bonded (and the Lien on any cash or
securities serving as security for such bond) or released of record within
forty-five (45) days after the date such Lien or judgment is entered or filed
against the Borrower, or any Subsidiary, or (II) Liens which are being
contested in good faith by appropriate proceedings for review and in respect of
which there shall have been secured a subsisting stay of execution pending such
appeal or proceedings and as to which the subject asset is not at risk of
forfeiture;


 


(h)  [Reserved];


 


(i)  [Reserved];


 


(j)  Liens not otherwise
described but existing as of the Closing Date and listed on Schedule 1.1D;


 


(k) Liens in favor of any
Collateral SPV; and


 


(l)  Liens created
pursuant to the Collateral Documents in favor of the Collateral Trustee for the
benefit of the Agents and the Banks.


 


“Permitted Note Repurchases” means
repurchases of (i) public notes of the Borrower outstanding as of the
Closing Date or (ii) Secured Exchange Notes, in each case, maturing after June 26,
2012, in an aggregate purchase price with respect to clauses (i) and (ii) above
not to exceed, when taken together with the purchase price for all Permitted
Share Repurchases consummated on or after the Closing Date, (x) if the
loans and other obligations under the First Priority Credit Agreement have been
paid in full and the commitments thereunder have been terminated, $750,000,000
and (y) if otherwise, $350,000,000.


 


“Permitted Share Repurchases” means
repurchases of shares of common stock of the Borrower in a purchase price not
to exceed the lesser of (i) $100,000,000 and (ii)(A)(x) if the loans
and other obligations under the First Priority Credit Agreement have been paid
in full and the commitments thereunder have been terminated, $750,000,000 and (y) if
otherwise, $350,000,000 minus (B) the purchase price for all
Permitted Note Repurchases consummated prior to the date of determination; provided
that not more than $50,000,000 of such repurchases may be made prior to December 31,
2010.


 


“Person” means an individual, a
corporation, a partnership, a limited liability company, an association, a
trust or any other entity or organization, including, without limitation, a
government or political subdivision or an agency or instrumentality thereof.


 


22

















 


“Plan” means at any time an employee
pension benefit plan (other than a Multiemployer Plan) which is covered by
Title IV of ERISA or subject to the minimum funding standards under Section 412
of the Code and either (i) is maintained, or contributed to, by any member
of the ERISA Group for employees of any member of the ERISA Group or (ii) has
at any time within the preceding five years been maintained, or contributed to,
by any Person which was at such time a member of the ERISA Group for employees
of any Person which was at such time a member of the ERISA Group.


 


“Pledged Collateral List” means the
ranked list of Collateral set forth on Schedule 1.1E, as such Schedule may be
updated and as such list may be re-ranked or otherwise modified in accordance
with the terms of this Agreement.


 


“Pledged Collateral LLC” means a Collateral
LLC, the equity interests in which constitute Collateral.


 


“Prime Rate” means the rate of
interest publicly announced by the Administrative Agent from time to time as
its “prime rate”.


 


“Principal Collateral Payments” means (i) any
payments or prepayments of principal on account of Loan Assets and (ii) the
net cash proceeds of any sales or other realizations on account of Credit
Tenant Lease Assets, Other Real Estate Owned Assets or other assets, in each
case with respect to clauses (i) and (ii) above, to the extent such
assets are included in the Collateral or are owned by a Pledged Collateral LLC.


 


“Principal Collateral Payment Event”
means any Fixed Charge Coverage Ratio Payment Event or any Listed Eligible
Asset Payment Event.


 


“principal financial center” means,
when used in reference to an Alternate Currency, (a) in the case of
British Pounds Sterling, London, England, (b) in the case of Euros,
London, England, and (c) in the case of Canadian Dollars, Toronto, Canada.


 


“Priority of Payments” has the meaning
set forth in Section 2.15.


 


“Pro Rata Share” means, for any Bank,
a fraction (expressed as a percentage), the numerator of which shall be the
amount of such Bank’s Revolving Credit Commitment or Term Loan Commitment, as
applicable, and the denominator of which shall be the aggregate amount of all
of the Banks’ corresponding Revolving Credit Commitments or Term Loan
Commitments, as adjusted from time to time in accordance with the provisions of
this Agreement (or, with respect to Revolving Credit Commitments following the
termination of the Revolving Credit Commitments, the numerator of which shall
be the amount of such Bank’s Revolving Credit Loans outstanding and the
denominator of which shall be the aggregate amount of all of the Banks’
Revolving Credit Loans outstanding).  For
the avoidance of doubt, the term “Pro Rata Share”, as used herein, does not
apply to the Revolving Credit Commitments and Term Loan Commitments taken as a
whole (either for any Bank individually or for all of the Banks in the
aggregate) or to any Term Loans following the termination of the Term Loan
Commitments.


 


“Property” means, with respect to any
Person, any real or personal property, building, facility, structure, equipment
or unit, or other asset owned by such Person.


 


23

















 


“Qualified Institution” means (i) a
Bank or any Affiliate thereof; (ii) a commercial bank having total assets
in excess of $5,000,000,000; (iii) the central bank of any country which
is a member of the Organization for Economic Cooperation and Development; or (iv) a
finance company or other financial institution (other than the Borrower or its
Affiliates) reasonably acceptable to the Administrative Agent, which is
regularly engaged in making, purchasing or investing in loans and having total
assets in excess of $500,000,000 or is otherwise reasonably acceptable to the
Administrative Agent; provided that in no event shall any competitor of
the Borrower or any Subsidiary qualify as a “Qualified Institution” if the
Borrower reasonably determines that such entity constitutes such a
competitor.  Notwithstanding the
foregoing, however, in no event shall any commercial bank or any wholly-owned
Subsidiary thereof, savings and loan institution, investment bank or broker/dealer
be deemed to be a competitor of the Borrower.


 


“Quotation
Date” means, in relation to any Interest Period for which an interest rate
is to be determined:


 


(a)           if with respect to a Euro-Currency Loan in Dollars or in
any Alternate Currency other than Euros, two Euro-Currency Business Days before
the first day of such Interest Period, or


 


(b)           if with respect to an Multicurrency
Revolving Credit Loan denominated in Euros, two TARGET Days before the first
day of such Interest Period,


 


unless market
practice differs in the relevant interbank market for an Alternate Currency
(other than Euros), in which case the Quotation Date for that Alternate
Currency will be determined by the Administrative Agent in accordance with
market practice in the relevant interbank market (and if quotations would
normally be given by leading banks in the relevant interbank market on more
than one day, the Quotation Date will be the last of those days).


 


“Rating Agencies” means, collectively,
S&P and Moody’s.


 


“Real Property Assets” means as to any
Person as of any time, the real property assets (including, without limitation,
interests in participating mortgages in which such Person’s interest therein is
characterized as equity according to GAAP) owned directly or indirectly by such
Person at such time.


 


“Recourse Debt” means Indebtedness
other than Non-Recourse Indebtedness.


 


“Regulation U” means Regulation U of
the Board of Governors of the Federal Reserve System, as in effect from time to
time.


 


“REIT” means a real estate investment
trust, as defined under Section 856 of the Code.


 


“Required Banks” means at any time
Banks having or holding more than 50% of the sum of (i) the aggregate
unpaid principal amount of Term Loans then outstanding hereunder and (ii) the
aggregate amount of Revolving Credit Commitments then in effect or, if the
Revolving Credit Commitments have been terminated, the aggregate amount of
Revolving Credit 


 


24

















 


Loans and
Letters of Credit then outstanding hereunder; provided that in the case
of Swingline Loans, the amount of each Bank’s funded participation interest in
such Swingline Loans shall be considered for purposes hereof as if it were a
direct loan and not a participation interest, and the aggregate amount of
Swingline Loans owing to the Swingline Lender shall be considered for purposes
hereof as reduced by the amount of such funded participation interests; provided
further that the undrawn Commitments of, and Loans held by, any
Defaulting Bank shall be excluded for purposes of making a determination of
Required Banks.


 


“Revolving Credit Borrowing” means a
borrowing pursuant to Section 2.2 consisting of simultaneous Revolving
Credit Loans of the same Type and currency and, in the case of Revolving Credit
Loans that are Euro-Currency Loans, having the same Interest Period.


 


“Revolving Credit Commitments” means
the collective reference to the Dollar Revolving Credit Commitments and the
Multicurrency Revolving Credit Commitments.


 


“Revolving Credit Loans” means the
collective reference to the Dollar Revolving Credit Loans and the Multicurrency
Revolving Credit Loans.


 


“Revolving Facility Amount” has the
meaning set forth in Section 2.2.


 


“S&P” means Standard &
Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc., or
any successor thereto.


 


“Second Priority Bank Facilities”
means the Loans, Letters of Credit and Commitments documented under this
Agreement and the loans, letters of credit and commitments documented under the
2012 Second Priority Credit Agreement.


 


“Second Priority Secured Exchange Notes”
means Secured Exchange Notes which are secured ratably with the Second Priority
Bank Facilities (if any) by a second priority security interest in the
Collateral, subject only to the first priority Lien granted pursuant to the
Security Agreement for the benefit of the First Priority Secured Parties.


 


“Secured Bank Facilities” means the
Second Priority Bank Facilities and the loans and commitments documented under
the First Priority Credit Agreement.


 


“Secured Debt” means Indebtedness, the
payment of which is secured by a Lien (other than a Permitted Lien listed in
clauses (a) - (g) of the definition thereof set forth herein) on any
Property owned or leased by the Borrower or any Consolidated Subsidiary (it
being understood that Indebtedness of any Subsidiary (other than a Guarantor)
that is material to the value of such Subsidiary’s assets shall be Secured
Debt).


 


“Secured Exchange Notes” means notes
(which may be in the form of bonds or loans) issued by the Borrower after the
Closing Date which (i) are issued in exchange for or to refinance public
notes issued by the Borrower prior to the Closing Date, (ii) are secured
by the Collateral as permitted under and in accordance with the Loan Documents,
(iii) if the public notes for which they are exchanged or which they
refinance pursuant to clause (i) above mature prior to the Termination
Date, have a maturity date on or after the maturity date for such existing 


 


25

















 


public notes
and (iv) shall not have more restrictive covenants and terms than those
applicable to the Secured Bank Facilities, taken as a whole.


 


“Secured Parties” has the meaning set
forth in the Collateral Trust Agreement.


 


“Securities” means any stock,
partnership interests, shares, shares of beneficial interest, voting trust
certificates, bonds, debentures, notes or other evidences of indebtedness,
secured or unsecured, convertible, subordinated or otherwise, or in general any
instruments commonly known as “securities,” or any certificates of interest,
shares, or participations in temporary or interim certificates for the purchase
or acquisition of, or any right to subscribe to, purchase or acquire any of the
foregoing, and shall include Indebtedness which would be required to be
included on the liabilities side of the balance sheet of the Borrower in
accordance with GAAP, but shall not include any Cash or Cash Equivalents or any
evidence of the Obligations.


 


“Securities Account Control Agreement”
means, individually and collectively, each “Securities Account Control
Agreement” referred to in the Security Agreement. “Solvent” means, with
respect to any Person, that the fair saleable value of such Person’s assets
exceeds the Indebtedness of such Person.


 


“Security Agreement” means the
Security Agreement dated the date hereof between iStar Tara Holdings LLC, iStar
Tara LLC, certain Subsidiaries of the Borrower to be agreed and the Collateral
Trustee, substantially in the form of Exhibit C, as the same may be
amended, modified or supplemented from time to time.


 


 “Special
Fremont Reranking” has the meaning set forth in Section 2.23(c).


 


“Specified Listed Eligible Assets”
means, on any date of determination, the aggregate Listed Eligible Assets on
such date with the highest rankings (as determined pursuant to the most recent
ranking pursuant to Section 2.23(b) or Section 2.23(c), as
applicable) with an aggregate Borrowing Base Value equal to the lowest amount
which is at least (i) the product of (x) the Available Secured Bank
Exposure multiplied  by (y) 1.30 (or, if the Exchange Option
Termination shall have occurred and no Second Priority Secured Exchanged Notes
shall have been issued, 1.20), plus (ii) the greater of (x) the
product of (A) the Available Secured Note Exposure (which, following the
date of the Exchange Option Termination, if any, shall be $0) multiplied
by (B) 1.30 and (y) $375,000,000 plus (iii) if no
Second Priority Secured Exchange Notes shall have been issued and the Exchange
Option Termination shall not have occurred on or prior to such date of
determination, the product of (x) the Outstanding Secured Exposure multiplied
by (y) 0.1 minus (iv) the portion of the Borrowing Base
Value of the Collateral that is in excess of the amount necessary to satisfy
the Coverage Ratio on such date of determination.


 


“Subsidiary” means any corporation or
other entity of which securities or other ownership interests having ordinary
voting power to elect a majority of the board of directors or other persons
performing similar functions are at the time directly or indirectly owned by
the Borrower.


 


“Super-Majority Banks” means at any
time Banks having or holding more than 75% of the sum of (i) the aggregate
unpaid principal amount of Term Loans then outstanding 


 


26

















 


hereunder and (ii) the
aggregate amount of Revolving Credit Commitments then in effect or, if the
Revolving Credit Commitments have been terminated, the aggregate amount of
Revolving Credit Loans and Letters of Credit then outstanding hereunder; provided
that in the case of Swingline Loans, the amount of each Bank’s funded
participation interest in such Swingline Loans shall be considered for purposes
hereof as if it were a direct loan and not a participation interest, and the
aggregate amount of Swingline Loans owing to the Swingline Lender shall be
considered for purposes hereof as reduced by the amount of such funded
participation interests; provided  further that the undrawn
Commitments of, and Loans held by, any Defaulting Bank shall be excluded for
purposes of making a determination of Super-Majority Banks.


 


“Swingline Borrowing” means a
borrowing of a Swingline Loan pursuant to Section 2.4.


 


“Swingline Commitment” has the meaning
set forth in Section 2.4(a).


 


“Swingline Lender” means JPMorgan
Chase Bank, N.A., in its capacity as swingline lender hereunder, and its
permitted successors in such capacity in accordance with the terms of this
Agreement or any other Bank that shall consent thereto as may be designated by
Borrower from time to time.


 


“Swingline Loan” means a loan in
Dollars made by the Swingline Lender pursuant to Section 2.4.


 


“Syndication Agents” means each of
Bank of America, N.A. and Citicorp North America, Inc., in their respective
capacities as syndication agents hereunder and their respective permitted
successors in such capacity in accordance with the terms of this Agreement.


 


“TARGET Day” means any day on which
the Trans-European Automated Real-time Gross Settlement Express Transfer
payment system is open for settlement of payments in Euros.


 


“Taxes” means all federal, state,
local and foreign income and gross receipts taxes.


 


“Term” has the meaning set forth in Section 2.10.


 


“Term Loan” means a term loan made by
a Bank in Dollars pursuant to Section 2.1; provided that, if any such loan
or loans (or portions thereof) are combined or subdivided pursuant to a Notice
of Interest Rate Election, the term “Term Loan” shall refer to the
combined principal amount resulting from such combination or to each of the
separate principal amounts resulting from such subdivision, as the case may be.


 


“Term Loan Borrowing” means a
borrowing pursuant to Section 2.1 consisting of simultaneous Term Loans of
the same Type and, in the case of any suchTerm Loans that are Euro-Currency
Loans, having the same Interest Period.


 


“Term Loan Commitment” means with
respect to each Bank, the obligation of such Bank to make a Term Loan in
Dollars to the Borrower on the Closing Date in the principal 


 


27

















 


amount set
forth on Schedule 1.1A next to the name of such Bank as such Bank’s “Term
Loan Commitment”).  The initial aggregate
amount of the Banks’ Term Loan Commitments is $1,055,000,000.


 


“Termination Date” means June 26,
2012.


 


“Termination Event” means (i) a “reportable
event”, as such term is described in Section 4043 of ERISA (other than a “reportable
event” not subject to the provision for 30-day notice to the PBGC), or an event
described in Section 4062(e) of ERISA, (ii) the withdrawal by
any member of the ERISA Group from a Multiemployer Plan during a plan year in
which it is a “substantial employer” (as defined in Section 4001(a)(2) of
ERISA), or the incurrence of liability by any member of the ERISA Group under Section 4064
of ERISA upon the termination of a Multiemployer Plan, (iii) the filing of
a notice of intent to terminate any Plan under Section 4041 of ERISA,
other than in a standard termination within the meaning of Section 4041 of
ERISA, or the treatment of a Plan amendment as a distress termination under Section 4041
of ERISA, (iv) the institution by the PBGC of proceedings to terminate,
impose liability (other than for premiums under Section 4007 of ERISA) in
respect of, or cause a trustee to be appointed to administer, any Plan or (v) any
other event or condition that might reasonably constitute grounds for the
termination of, or the appointment of a trustee to administer, any Plan or the
imposition of any liability or encumbrance or Lien on the Real Property Assets
or any member of the ERISA Group under ERISA or the Code.


 


“Total Indebtedness” means, as of the
date of determination and without duplication, all Indebtedness of the Borrower
and its Consolidated Subsidiaries, but excluding the Borrower’s Share of all
Indebtedness of Investment Affiliates.


 


“Type” means as to any Loan or
Borrowing its nature as a Base Rate Loan, a Euro-Currency Loan, a Base Rate
Borrowing or a Euro-Currency Borrowing, as the case may be.


 


“Undepreciated Real Estate Assets”
means, as of any date, the cost (being the original cost to the Borrower or the
applicable Subsidiary plus capital improvements) of real estate assets of the
Borrower and its Subsidiaries on such date, before depreciation and
amortization of such real estate assets, determined on a consolidated basis in
accordance with GAAP.


 


“Unencumbered Assets” means the sum of
(i) Undepreciated Real Estate Assets not securing any portion of Secured
Debt and (ii) all other assets (but excluding intangibles and accounts
receivable) of the Borrower and its Subsidiaries not securing any portion of
Secured Debt on a consolidated basis in accordance with GAAP; provided that
assets (including Undepreciated Real Estate Assets) of any Subsidiary (other
than a Guarantor) having Indebtedness that is material to the value of such
assets shall be excluded from Unencumbered Assets.


 


“Uniform Commercial Code” means the
Uniform Commercial Code as the same may from time to time be in effect in the
State of New York or the Uniform Commercial Code (or similar code or statute)
of another jurisdiction, to the extent it may be required to apply to any item
or items of Collateral.


 


28
















 


“United States” means the United
States of America, including the fifty states and the District of Columbia.


 


“Unsecured Debt” means the amount of
Indebtedness for borrowed money of the Borrower (or any Subsidiary) which is
not Secured Debt.


 


“Value” means, as of any date of
determination, with respect to each Unencumbered Asset, the lesser of (x) undepreciated
cost (or in the case of any asset that is less than 100% owned, directly or
indirectly, by the Borrower, the Borrower’s pro rata share thereof), and (y) market
value (or in the case of any asset that is less than 100% owned, directly or
indirectly, by the Borrower, the Borrower’s pro rata share thereof), all as
determined in accordance with GAAP.


 


“Venture LLC” means (i) an
Investment Affiliate that owns Loan Assets, Credit Tenant Lease Assets and/or
Other Real Estate Owned Assets and (ii) iStar Woodward LLC.


 


Section 1.2. Accounting Terms and Determinations. 
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 basis consistent (except for
changes concurred in by the Borrower’s independent public accountants) with the
most recent audited consolidated financial statements of the Borrower and its
Consolidated Subsidiaries delivered to the Administrative Agent; provided that,
if the Borrower notifies the Administrative Agent that the Borrower wishes to
amend any covenant in Article V to eliminate the effect of any change in
GAAP on the operation of such covenant (or if the Administrative Agent notifies
the Borrower that the Required Banks wish to amend Article V for such
purpose), then the Borrower’s compliance with such covenant 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 covenant is
amended in a manner reasonably satisfactory to the Borrower and the Required
Banks.  The Borrower hereby agrees
that any election pursuant to FASB Statement No. 159 shall be disregarded
for all purposes of this Agreement.


 


ARTICLE II


 


THE
CREDITS


 


Section 2.1. Term Commitments.  Subject to the terms and conditions set forth
in this Agreement, each Bank
severally agrees to make a Term Loan in Dollars to the Borrower on the Closing
Date in an amount not to exceed the amount of the Term Loan Commitment of such
Bank.  The Term Loans may from time to
time be Euro-Currency Loans in Dollars or Base Rate Loans or a combination
thereof, as determined by the Borrower and notified to the Administrative Agent
in accordance with Section 2.3 and Section 2.7.  Any amount of Term Loans repaid or prepaid
may not be reborrowed.


 


Section 2.2. Revolving Credit
Commitments.  Each Bank severally
agrees, on the terms and conditions set forth in this Agreement, to make
Revolving Credit Loans (including 


 


29

















 


Revolving Credit Loans that are Euro-Currency Loans
denominated in Alternate Currencies) to the Borrower and participate in Letters
of Credit issued by the Fronting Bank on behalf of the Borrower pursuant to
this Article at any time and from time to time during the Term hereof in
Dollar Equivalent Amounts such that the aggregate principal Dollar Equivalent
Amount of Revolving Credit Loans by such Bank at any one time outstanding plus
such Bank’s Pro Rata Share of Swingline Loans outstanding together with such
Bank’s Pro Rata Share of the Letter of Credit Usage at such time shall not
exceed the Dollar Equivalent Amount of its Revolving Credit Commitment.  Each Euro-Currency Borrowing outstanding
under this Section 2.2 shall be in an aggregate principal Dollar
Equivalent Amount of approximately $5,000,000, or an integral multiple of a
Dollar Equivalent Amount of approximately $1,000,000 in excess thereof, and
each Base Rate Borrowing shall be in an aggregate principal Dollar Equivalent
Amount of approximately $1,000,000, or an integral multiple of a Dollar
Equivalent Amount of approximately $1,000,000 in excess thereof (except that
any such Borrowing may be in the aggregate amount available in accordance with Section 3.2(b),
or in any Dollar Equivalent Amount required to reimburse the Fronting Bank for
any drawing under any Letter of Credit or to repay the Swingline Lender the
amount of any Swingline Loan) and, other than with respect to Swingline Loans,
shall be made from the several Banks ratably in proportion to their respective Revolving
Credit Commitments. In no event shall the sum of the aggregate Dollar
Equivalent Amount of Revolving Credit Loans and Swingline Loans outstanding at
any time, plus the Dollar Equivalent Amount of the Letter of Credit Usage,
exceed $640,000,000 (as adjusted pursuant to Section 2.11(d), Section 2.12
or as may otherwise be provided in this Agreement, the “Revolving Facility
Amount”).  In no event shall the
aggregate Dollar Equivalent Amount of Multicurrency Revolving Credit Loans
outstanding at any time, plus the Dollar amount of the Letter of Credit Usage
with respect to Letters of Credit attributable to the Multicurrency Revolving
Commitments, exceed $552,600,000 (as adjusted pursuant to Section 2.11(d),
Section 2.12 or as may otherwise be provided in this Agreement, the “Multicurrency
Revolving Facility Amount”).  Subject
to the limitations set forth herein, any amounts of Revolving Credit Loans
repaid may be reborrowed.  The Borrower
agrees to use commercially reasonable efforts to assure that the Dollar
Revolving Credit Facility and the Multicurrency Revolving Credit Facility are,
to the extent practicable, at all times utilized for Loans and Letter of Credit
Usage on a ratable basis (including, for example, by making a reborrowing under
the Multicurrency Revolving Facility in Dollars at the time of any prepayment
of Loans under it in an Alternate Currency in order to fund a substantially
concurrent prepayment of Loans under the Dollar Revolving Facility).  Subject to the limitations set forth herein,
any amounts repaid may be reborrowed.


 


Section 2.3. Notice of Borrowing.  (a) With
respect to any Borrowing, the Borrower shall give the Administrative Agent
notice not later than 1:00 p.m. (New York City time, with respect to
Dollar Loans and Multicurrency Revolving Credit Loans denominated in Dollars,
and London time, with respect to Multicurrency Revolving Credit Loans
denominated in an Alternate Currency) (x) the Business Day prior to each
Base Rate Borrowing, or in the case of the Closing Date, on the date of such
Base Rate Borrowing, (y) the third (3rd)
Euro-Currency Business Day before each Euro-Currency Borrowing, or (z) the
fourth (4th) Euro-Currency Business Day before each
Euro-Currency Borrowing denominated in an Alternate Currency, specifying:


 


30

















 


(i)                                               the date of such Borrowing, which shall be a
Business Day in the case of a Base Rate Borrowing or a Euro-Currency Business
Day in the case of a Euro-Currency Borrowing,


 


(ii)                                            if the Loans comprising such Borrowing are
made on the Closing Date, whether such Loans are to be Term Loans, Dollar
Revolving Credit Loans or Multicurrency Revolving Credit Loans,


 


(iii)                                         the aggregate amount of such Borrowing,


 


(iv)                                        whether the Loans comprising such Borrowing
are to be Base Rate Loans or Euro-Currency Loans,


 


(v)                                           in the case of Multicurrency Revolving
Credit Loans denominated in an
Alternate Currency, the type and amount of the Alternate Currency being
requested,


 


(vi)                                        in the case of a Euro-Currency Borrowing, the
duration of the Interest Period applicable thereto, subject to the provisions
of the definition of Interest Period,


 


(vii)                                     payment instructions for delivery of such
Borrowing; and


 


(viii)                                  that no Default or Event of Default has
occurred or is continuing.


 


Notwithstanding the foregoing or any other
provision hereof, on the Closing Date, the Borrower shall be deemed to have
made Borrowings under the Term Loan Commitments and the Revolving Credit
Commitments as provided in the next two sentences.  Such deemed Borrowings under the Term Loan
Commitments shall be in an aggregate amount in Dollars equal to the Term Loan
Commitments and shall be Base Rate Loans and Euro-Currency Loans in the same
respective amounts (and, in the case of any Euro-Currency Borrowing, having an
Interest Period with the same remaining term) as the respectively equivalent
loans (or any ratable portions of such loans) in Dollars held by the lenders
under the Existing 2006 Credit Agreement immediately prior to the Closing Date
that are designated by the Borrower in such Notice of Borrowing to be converted
to such Term Loans hereunder on the Closing Date.  Such deemed Borrowings under the Revolving
Credit Commitments shall be in the respective aggregate amounts in Dollars and
Alternative Currencies as specified by the Borrower and shall be Base Rate
Loans and Euro-Currency Loans, in the same respective amounts (and, in the case
of any Euro-Currency Borrowing, having an Interest Period with the same
remaining term) as the respectively equivalent loans (or any ratable portion of
such loans) in Dollars and such Alternate Currencies held by the lenders under
the Existing 2006 Credit Agreement immediately prior to the Closing Date that
are designated by the Borrower in such Notice of Borrowing to be converted to
Revolving Credit Loans hereunder on the Closing Date (it being acknowledged
that (a) on, or promptly following, the Closing Date there may also be
prepayments and reborrowings under the Revolving Credit Commitments in order to
provide for (i) the transfer to this Agreement of the Existing Letters of
Credit, (ii) the prepayment of any loans in Alternate Currencies held by
lenders under the Existing 2006 Credit Agreement who have no 


 


31

















 


commitments
under this Agreement on the Closing Date and (iii) the prepayment of
Revolving Credit Loans in Dollars so as to make Revolving Credit Commitments
available for the transactions referred to in foregoing clauses (i) and (ii) and
(b) in the event of any such prepayments and reborrowings, Section 2.16
shall apply to the same extent as if such prepayments and reborrowings occurred
after the Closing Date).


 


(b)                                 The Borrower shall give the Administrative
Agent, and the Fronting Bank, written notice in the event that it desires to
have Letters of Credit issued, or to have Letters of Credit issued on behalf of
a Subsidiary, hereunder no later than 1:00 p.m. (New York City time) at
least four (4) Business Days prior to, but excluding, the date of such
issuance.  Each such notice shall specify
(i) the individual amount of each Letter of Credit, (ii) the number
of Letters of Credit to be issued, (iii) the date of such issuance (which
shall be a Business Day), (iv) the name and address of the beneficiary, (v) the
expiration date of the Letter of Credit (which in no event shall be later than
the date which is the first anniversary of the Maturity Date), (vi) the
purpose and circumstances for which such Letter of Credit is being issued, (vii) the
terms upon which each such Letter of Credit may be drawn down (which terms
shall not leave any discretion to Fronting Bank) and (viii) that no
Default or Event of Default has occurred or is continuing.  Each such notice may be revoked
telephonically by the Borrower to the Fronting Bank and the Administrative
Agent any time prior to the issuance of the Letter of Credit by the Fronting
Bank; provided such revocation is confirmed in writing by the Borrower
to the Fronting Bank and the Administrative Agent within one (1) Business
Day by facsimile.  Notwithstanding
anything contained herein to the contrary, the Borrower shall complete and
deliver to the Fronting Bank, at the Fronting Bank’s request, any required
documentation in connection with any requested Letter of Credit no later than
the second (2nd) Business Day prior to the date of issuance thereof.  No later than 1:00 p.m. (New York City
time) on the date that is four (4) Business Days prior to, but excluding,
the date of issuance, the Borrower shall specify a precise description of the
documents and the verbatim text of any certificate to be presented by the
beneficiary of such Letter of Credit, which if presented by such beneficiary
prior to the expiration date of the Letter of Credit would require the Fronting
Bank to make a payment under the Letter of Credit; provided, that Fronting Bank
may, in its reasonable judgment, require changes in any such documents and
certificates only in conformity with changes in customary and commercially
reasonable practice or law and; provided  further, that no Letter
of Credit shall require payment against a conforming draft to be made
thereunder on the second Business Day following the date that such draft is
presented if such presentation is made later than 1:00 p.m. New York City
time (except that if the beneficiary of any Letter of Credit requests at the
time of the issuance of its Letter of Credit that payment be made on the same
Business Day against a conforming draft, such beneficiary shall be entitled to
such a same day draw; provided such draft is presented to the Fronting
Bank no later than 1:00 p.m. (New York City time) and provided further the
Borrower shall have requested to the Fronting Bank and the Administrative Agent
that such beneficiary shall be entitled to a same day draw). In determining
whether to pay on such Letter of Credit, the Fronting Bank shall be responsible
only to determine that the documents and certificates required to be delivered
under the Letter of Credit have been delivered and that they comply on their
face with the requirements of that Letter of Credit.  As provided in Section 2.19(a), the
Existing Letters of Credit shall be deemed to have been issued under this
Agreement on the Closing Date.


 


32

















 


Section 2.4. Swingline Loan Subfacility.


 


(a)                                  Swingline Commitment. 
Subject to the terms and conditions of this Section 2.4, the
Swingline Lender, in its individual capacity, agrees to make certain revolving
credit loans denominated in Dollars to the Borrower (each a “Swingline Loan”
and, collectively, the “Swingline Loans”) at any time and from time to
time during the Term hereof; provided, however, that the aggregate amount of
Swingline Loans outstanding at any time shall not exceed the lesser of (i) $25,000,000,
and (ii) the aggregate Revolving Credit Commitments less the sum of (A) all
Revolving Credit Loans and Swingline Loans then outstanding, and (B) the
Letter of Credit Usage (the “Swingline Commitment”); provided that the
Swingline Lender shall not make any Swingline Loan available if, after giving
effect thereto the aggregate principal amount of the sum of (i) the
Swingline Lender’s Swingline Loans then outstanding, (ii) all other
Revolving Credit Loans held by the Swingline Lender then outstanding and (iii) the
Swingline Lender’s Pro Rata Share of the Letter of Credit Usage at such time,
would exceed such Swingline Lender’s Revolving Credit Commitment.  Subject to the limitations set forth herein,
any amounts repaid in respect of Swingline Loans may be reborrowed.


 


(b)                                 Swingline Borrowings.


 


(i)                                     Notice of Borrowing.  With
respect to any Swingline Borrowing, the Borrower shall give the Swingline
Lender and the Administrative Agent notice in writing which is received by the
Swingline Lender and Administrative Agent not later than 2:00 p.m. (New
York City time) on the proposed date of such Swingline Borrowing (and confirmed
by telephone by such time), specifying (A) that a Swingline Borrowing is
being requested, (B) the amount of such Swingline Borrowing, (C) the
proposed date of such Swingline Borrowing, which shall be a Business Day and (D) that
no Default or Event of Default has occurred and is continuing both before and
after giving effect to such Swingline Borrowing.  Such notice shall be irrevocable.


 


(ii)                                  Minimum Amounts.  Each
Swingline Borrowing shall be in a minimum principal amount of $1,000,000, or an
integral multiple of $100,000 in excess thereof.


 


(iii)                               Repayment of Swingline Loans.  Each
Swingline Loan shall be due and payable on the earliest of (A) 5 Business
Days from and including the date of the applicable Swingline Borrowing, (B) the
date of the next Revolving Credit Borrowing or (C) the Maturity Date.  If, and to the extent, any Swingline Loans
shall be outstanding on the date of any Revolving Credit Borrowing, such
Swingline Loans shall first be repaid from the proceeds of such Revolving
Credit Borrowing prior to the disbursement of the same to the Borrower.  If, and to the extent, a Revolving Credit
Borrowing is not requested prior to the Maturity Date or the end of the 5
Business Day period after a Swingline Borrowing, or unless the Borrower shall
have notified the Administrative Agent and the Swingline Lender prior to 1:00 p.m.
(New York City time) on the fourth (4th)
Business Day after the Swingline Borrowing that the Borrower intends to
reimburse the Swingline Bank for the amount of such Swingline Borrowing with
funds other 


 


33

















 


than
proceeds of the Revolving Credit Loans, the Borrower shall be deemed to have
requested a Revolving Credit Borrowing comprised entirely of Base Rate Loans in
the amount of the applicable Swingline Loan then outstanding, the proceeds of
which shall be used to repay such Swingline Loan to the Swingline Lender.  In addition, if (x) the Borrower does
not repay the Swingline Loan on or prior to the end of such 5 Business Day
period, or (y) a Default or Event of Default shall have occurred during
such 5 Business Day period, the Swingline Lender may, at any time, in its sole
discretion, by written notice to the Borrower and the Administrative Agent,
demand repayment of its Swingline Loans by way of a Revolving Credit Borrowing,
in which case the Borrower shall be deemed to have requested a Revolving Credit
Borrowing comprised entirely of Base Rate Loans in the amount of such Swingline
Loans then outstanding, the proceeds of which shall be used to repay such
Swingline Loans to the Swingline Lender. 
Any Revolving Credit Borrowing which is deemed requested by the Borrower
in accordance with this Section 2.4(b)(iii) is hereinafter referred
to as a “Mandatory Borrowing”. 
Each Bank hereby irrevocably agrees to make Revolving Credit Loans
promptly upon receipt of notice from the Swingline Lender of any such deemed
request for a Mandatory Borrowing in the amount and in the manner specified in
the preceding sentences and on the date such notice is received by such Bank
(or the next Business Day if such notice is received after 12:00 noon (New York
City time)) notwithstanding (I) that the amount of the Mandatory Borrowing
may not comply with the minimum amount of Revolving Credit Borrowings otherwise
required hereunder, (II) whether any conditions specified in Section 3.2
are then satisfied, (III) whether a Default or an Event of Default then exists,
(IV) failure of any such deemed request for a Revolving Credit Borrowing
to be made by the time otherwise required in Section 2.3, (V) the
date of such Mandatory Borrowing (provided that such date must be a Business
Day), or (VI) any termination of the Revolving Credit Commitments
immediately prior to such Mandatory Borrowing or contemporaneously therewith;
provided, however, that no Bank shall be obligated to make Revolving Credit
Loans in respect of a Mandatory Borrowing if a Default or an Event of Default
then exists and the applicable Swingline Loan was made by the Swingline Lender
without receipt of a written Notice of Borrowing in the form specified in
subclause (i) above or after Administrative Agent has delivered a notice
of Default or Event of Default which has not been rescinded.


 


(iv)                              Purchase of Participations.  In
the event that any Mandatory Borrowing cannot for any reason be made on the
date otherwise required above (including, without limitation, as a result of
the commencement of a proceeding under the Bankruptcy Code with respect to the
Borrower), then each Bank hereby agrees that it shall forthwith purchase (as of
the date the Mandatory Borrowing would otherwise have occurred, but adjusted
for any payment received from the Borrower on or after such date and prior to
such purchase) from the Swingline Lender such participations in the outstanding
Swingline Loans as shall be necessary to cause each such Bank to share in such
Swingline Loans ratably based upon its Pro Rata Share of the Revolving Credit
Commitments (determined before giving effect to any termination of the
Revolving Credit Commitments pursuant 


 


34

















 


to
Section 6.2); provided that (A) all interest payable on the
Swingline Loans with respect to any participation shall be for the account of
the Swingline Lender until but excluding the day upon which the Mandatory
Borrowing would otherwise have occurred, and (B) in the event of a delay
between the day upon which the Mandatory Borrowing would otherwise have
occurred and the time any purchase of a participation pursuant to this sentence
is actually made, the purchasing Bank shall be required to pay to the Swingline
Lender interest on the principal amount of such participation for each day from
and including the day upon which the Mandatory Borrowing would otherwise have
occurred to but excluding the date of payment for such participation, at the
rate equal to the Federal Funds Rate, for the two (2) Business Days after
the date the Mandatory Borrowing would otherwise have occurred, and thereafter
at a rate equal to the Base Rate. 
Notwithstanding the foregoing, no Bank shall be obligated to purchase a
participation in any Swingline Loan if a Default or an Event of Default then
exists and such Swingline Loan was made by the Swingline Lender without receipt
of a written Notice of Borrowing in the form specified in subclause (i) above
or after Administrative Agent has delivered a notice of Default or Event of
Default which has not been rescinded.


 


(c)                                  Interest Rate.  Each
Swingline Loan shall bear interest on the outstanding principal amount thereof,
for each day from the date such Swingline Loan is made until the date it is
repaid, at a rate per annum equal to the Federal Funds Rate plus the Applicable
Margin for Euro-Currency Loans for such day.


 


Section 2.5. Notice to Banks;
Funding of Loans; Replacement of Defaulting Bank.


 


(a)                                  Upon receipt of a Notice of Borrowing from
the Borrower in accordance with Section 2.3 hereof, the Administrative Agent
shall, on the date such Notice of Borrowing is received by the Administrative
Agent, notify each applicable Bank of the contents thereof and of such Bank’s
share of such Borrowing, of the interest rate applicable thereto and the
Interest Period(s) and such Notice of Borrowing shall not thereafter be
revocable by the Borrower, unless the Borrower shall pay any applicable
expenses pursuant to Section 2.16.


 


(b)                                 Not later than 2:00 p.m. (New York City
time or, in the case of any Alternate Currency Borrowing, London time) on the
date of each Borrowing (including without limitation each Mandatory Borrowing)
as indicated in the applicable Notice of Borrowing, each Bank shall (except as
provided in subsection (d) of this Section 2.5) make available its
Pro Rata Share of such Borrowing in Federal funds or the applicable Alternate
Currency immediately available in New York, New York (or, in the case of any
Alternate Currency Borrowing, the principal financial center of the Alternate
Currency in question), to the Administrative Agent at its address referred to
in Section 9.1.  If the Borrower has
requested the issuance of a Letter of Credit, no later than 1:00 p.m. (New
York City time) on the date of such issuance as indicated in the notice
delivered pursuant to Section 2.3(b), the Fronting Bank shall issue such
Letter of Credit for the amount so requested and deliver the same to, or as
directed in writing by, the Borrower, with a copy thereof to the Administrative
Agent.  Immediately upon the issuance of
each Letter of Credit by the Fronting Bank, the Fronting Bank shall be deemed
to have sold and 


 


35

















 


transferred to each other Bank, and each such
other Bank shall be deemed, and hereby agrees, to have irrevocably and
unconditionally purchased and received from the Fronting Bank, without recourse
or warranty, an undivided interest and a participation in such Letter of
Credit, any drawing thereunder, and its obligation to pay its Pro Rata Share
with respect thereto, and any security therefor or guaranty pertaining thereto,
in an amount equal to such Bank’s ratable share thereof.  Upon any change in any of the Revolving
Credit Commitments in accordance herewith, there shall be an automatic
adjustment to such participations to reflect such changed shares.  The Fronting Bank shall have the primary
obligation to fund any and all draws made with respect to such Letter of Credit
notwithstanding any failure of a participating Bank to fund its ratable share
of any such draw.  The Administrative
Agent will instruct the Fronting Bank to make such Letter of Credit available
to the Borrower and the Fronting Bank shall make such Letter of Credit
available to the Borrower, at its aforesaid address or at such address in the
United States or at such address in Europe, the United Kingdom, Canada or the
United States as the Borrower shall request on the date of Borrowing.


 


(c)                                  Not later than 3:00 p.m. (New York City
time) on the date of each Swingline Borrowing as indicated in the applicable
Notice of Borrowing, the Swingline Lender shall make available such Swingline
Borrowing in Federal funds immediately available in New York, New York to the
Administrative Agent at its address referred to in Section 9.1.


 


(d)                                 Unless the Administrative Agent shall have
received notice from a Bank prior to the time of any Borrowing that such Bank
will not make available to the Administrative Agent such Bank’s share of such
Borrowing, the Administrative Agent may assume that such Bank has made such
share available to the Administrative Agent on the date of such Borrowing in
accordance with this Section 2.5, and the Administrative Agent may, in
reliance upon such assumption, but shall not be obligated to, make available to
the Borrower on such date a corresponding amount on behalf of such Bank.  If and to the extent that such Bank shall not
have so made such share available to the Administrative Agent, such Bank agrees
to repay to the Administrative Agent forthwith on demand such corresponding
amount together with interest thereon, at the Federal Funds Rate with respect
to Dollar Loans and Multicurrency Revolving Credit Loans denominated in Dollars
and at the Administrative Agent’s cost of funds for the applicable Alternate
Currency with respect to Multicurrency Revolving Credit Loans denominated in an Alternate Currency,
for each day from the date such amount is made available to the Borrower until
the date such amount is repaid to the Administrative Agent. If such Bank shall
repay to the Administrative Agent such corresponding amount, such amount so
repaid shall constitute such Bank’s Loan included in such Borrowing for
purposes of this Agreement.  If such Bank
shall not pay to the Administrative Agent such corresponding amount after
reasonable attempts are made by the Administrative Agent to collect such
amounts from such Bank, the Borrower agrees to repay to the Administrative
Agent forthwith on demand such corresponding amounts together with interest
thereto, for each day from the date such amount is made available to the
Borrower until the date such amount is repaid to the Administrative Agent, at
the interest rate applicable thereto one (1) Business Day after demand.
Nothing contained in this Section 2.5(d) shall be deemed to reduce
the Commitment of any Bank or in any way affect the rights of the Borrower with
respect to any Defaulting Bank or the Administrative Agent.  The failure of any Bank to make available to
the Administrative Agent such Bank’s share of any Borrowing in accordance with Section 2.5(b) hereof
shall not relieve any other Bank of its obligations to fund its Commitment, in
accordance with the provisions hereof.


 


36

















 


(e)                                  If any Bank becomes a Defaulting Bank and for
so long as such Bank remains a Defaulting Bank, then the Borrower may, at its
sole expense and effort, upon notice to such Bank and the Administrative Agent,
require such Bank to assign and delegate, without recourse (in accordance with
and subject to the restrictions contained in Section 9.6), all its undrawn
Commitments under this Agreement to an assignee that shall assume such
obligations (which assignee may be another Bank, if a Bank accepts such
assignment); provided that the Borrower shall have received the prior
written consent of the Administrative Agent, which consent shall not
unreasonably be withheld; provided  further that nothing contained
in this clause (e) shall affect the obligations due to such Defaulting
Bank.


 


(f)                                    Subject to the provisions hereof, the
Administrative Agent shall make available each Borrowing to the Borrower in
Federal funds or the applicable Alternate Currency immediately available in
accordance with, and on the date set forth in, the applicable Notice of
Borrowing.


 


Section 2.6. Notes.


 


(a)                                  Each Bank may, by notice to the Borrower and
the Administrative Agent, request that its various Term Loans, Revolving Credit
Loans and Swingline Loans be evidenced by separate Notes, each in an amount
equal to the aggregate unpaid principal amount of the applicable Loans.  Any additional costs incurred by the
Administrative Agent, the Borrower or the Banks in connection with preparing
such a Note shall be at the sole cost and expense of the Bank requesting such
Note.  In the event any Loans evidenced
by such a Note are paid in full prior to the Maturity Date, any such Bank shall
return such Note to the Borrower.  Each
such Term Loan Note shall be in substantially the form of Exhibit G-1
hereto, each such Revolving Credit Loan Note shall be in substantially the form
of Exhibit G-2 hereto and each such Swingline Loan Note shall be in
substantially the form of Exhibit G-3. 
Upon the execution and delivery of any such Note, any existing Note
payable to such Bank shall be returned to the Borrower and replaced or modified
accordingly.  Each reference in this
Agreement to the “Note” of such Bank shall be deemed to refer to and include
any or all of such Notes, as the context may require.


 


(b)                                 Upon receipt of any Bank’s Note(s) pursuant
to Section 3.1(a), the Administrative Agent shall forward such Note(s) to
such Bank.  Such Bank shall record the
date, amount, currency, Type and maturity of each Loan made by it and the date
and amount of each payment of principal made by the Borrower, with respect
thereto, and may, if such Bank so elects in connection with any transfer or
enforcement of its Note(s), endorse on the appropriate schedule appropriate
notations to evidence the foregoing information with respect to each such Loan
then outstanding; provided that the failure of such Bank to make any such
recordation or endorsement shall not affect the obligations of the Borrower
hereunder or under the Notes.  Each Bank
is hereby irrevocably authorized by the Borrower so to endorse its Note(s) and
to attach to and make a part of its Note(s) a continuation of any such
schedule as and when required.


 


(c)                                  The Term Loans and Revolving Credit Loans
shall mature, and the principal amount thereof shall be due and payable, on the
Maturity Date.  The Swingline Loans shall
mature, and the principal amount thereof shall be due and payable, in
accordance with Section 2.4(b)(iii).


 


37

















 


(d)                                 There shall be no more than ten (10) Euro-Currency
Group of Loans outstanding at any one time.


 


Section 2.7. Method of Electing Interest Rates.  (a) The
Loans included in each Borrowing shall bear interest initially at the type of
rate specified by the Borrower, in the applicable Notice of Borrowing or as
otherwise provided in Section 2.4 with respect to Mandatory Borrowings.  Thereafter, the Borrower may from time to time
elect to change or continue the type of interest rate borne by each Group of
Loans (subject in each case to the provisions of Article VIII and without
affecting the currency of any particular Loan), as follows:


 


(i)                                                             if such Loans are Base Rate Loans, the
Borrower may elect to convert all or any portion of such Loans to Euro-Currency
Loans as of any Euro-Currency Business Day;


 


(ii)                                                          if such Loans are Euro-Currency Loans, the
Borrower may elect to convert all or any portion of such Loans to Base Rate
Loans and/or elect to continue all or any portion of such Loans as
Euro-Currency Loans for an additional Interest Period or additional Interest
Periods, in each case effective on the last day of the then current Interest
Period applicable to such Loans, or on such other date designated by the
Borrower in the Notice of Interest Rate Election provided the Borrower shall
pay any losses pursuant to Section 2.16.


 


Each such election shall be
made by delivering a notice (a “Notice of Interest Rate Election”) to
the Administrative Agent at least three (3) Euro-Currency Business Days
prior to, but excluding, the effective date of the conversion or continuation
selected in such notice.  A Notice of
Interest Rate Election may, if it so specifies, apply to only a portion of the
aggregate principal amount of the relevant Group of Loans; provided that (i) such
portion is allocated ratably among the Loans comprising such Group of Loans, (ii) the
portion to which such Notice applies, and the remaining portion to which it
does not apply, are each in the minimum amounts required hereby, (iii) no
Loan may be continued as, or converted into, a Euro-Currency Loan when any
Event of Default has occurred and is continuing; provided, however,
that if and for so long as the Borrower shall have an Investment Grade Rating
from S&P and Moody’s, if the Borrower shall so request and the Required
Banks shall so elect, then a Loan may be continued as, or converted into, a
Euro-Currency Loan when any Event of Default has occurred and is continuing,
and (iv) no Interest Period shall extend beyond the Maturity Date.  Loans in any currency may not be converted to
be Loans in a different currency.


 


(b)                                 Each Notice of Interest Rate Election shall
specify:


 


(i)                                               if the applicable Loans are Term Loans,
Dollar Revolving Credit Loans or Multicurrency Revolving Credit Loans;


 


(ii)                                            the Group of Loans (or portion thereof) to
which such notice applies;


 


(iii)                                         the date on which the conversion or
continuation selected in such notice is to be effective, which shall comply
with the applicable clause of subsection (a) above;


 


38
















 


(iv)                                        if the Loans comprising such Group of Loans
are to be converted, the new Type of Loans and, if such new Loans are
Euro-Currency Loans, the duration of the initial Interest Period applicable
thereto; and


 


(v)                                           if such Loans are to be continued as Euro-Currency
Loans for an additional Interest Period, the duration of such additional
Interest Period.


 


Each Interest Period specified
in a Notice of Interest Rate Election shall comply with the provisions of the
definition of Interest Period.


 


(c)                                  Upon receipt of a Notice of Interest Rate
Election from the Borrower pursuant to subsection (a) above, the
Administrative Agent shall notify each Bank with Loans affected thereby the
same day as it receives such Notice of Interest Rate Election of the contents
thereof and the interest rates determined pursuant thereto and such notice
shall not thereafter be revocable by the Borrower.  If the Borrower fails to deliver a timely
Notice of Interest Rate Election to the Administrative Agent for any Group of
Euro-Currency Loans, such Dollar Loans and such Multicurrency Revolving
Credit Loans denominated in Dollars
shall be converted into Base Rate Loans on the last day of the then current
Interest Period applicable thereto and such Multicurrency Revolving
Credit Loans denominated in an
Alternate Currency shall be continued as Euro-Currency Loans with an Interest
Period of one month.


 


Section 2.8. Interest Rates.


 


(a)                                  Each Base Rate Loan shall bear interest on
the outstanding principal amount thereof, for each day from the date such Loan
is made until the date it is repaid or converted into a Euro-Currency Loan
pursuant to Section 2.7, at a rate per annum equal to sum of the Base Rate
plus the Applicable Margin for Base Rate Loans for such day.


 


(b)                                 Each Euro-Currency Loan shall bear interest
on the outstanding principal amount thereof, for each day during the Interest
Period applicable thereto, at a rate per annum equal to the sum of the
Applicable Margin for Euro-Currency Loans for such day plus the Euro-Currency
Rate applicable to such Interest Period.


 


(c)                                  In the event that, and for so long as, any
Event of Default shall have occurred and be continuing, any overdue principal
amount of any of the Loans, to the extent permitted by applicable law, overdue
interest and fees in respect of all Loans, shall bear interest at the annual
rate equal to the sum of the Base Rate and the Applicable Margin for Base Rate
Loans and two percent (2%), or, if any Loan shall have been continued as, or
converted into, a Euro-Currency Loan, then, as to such Loan only, the sum of
the Euro-Currency Rate applicable to such Loan and the Applicable Margin for
Euro-Currency Loans, and two percent (2%) (collectively, the “Default Rate”).


 


(d)                                 The Administrative Agent shall determine each
interest rate applicable to the Loans hereunder.  The Administrative Agent shall give prompt
notice to the Borrower and the Banks of each rate of interest so determined,
and its determination thereof shall be conclusive in the absence of
demonstrable error.


 


39

















 


(e)                                  Interest on all Loans bearing interest at the
Base Rate shall be payable in arrears on the first Business Day of each
calendar month.  Interest on all Loans
bearing interest based on the Euro-Currency Rate shall be payable in arrears on
the last Euro-Currency Business Day of the applicable Interest Period.


 


Section 2.9. Fees.


 


(a)                                  Facility Fee.  For
the period beginning on the date hereof and ending on the date the Obligations
are paid in full and this Agreement is terminated (the “Facility Fee Period”),
the Borrower shall pay to the Administrative Agent for the account of the Banks
ratably in proportion to their respective Term Loans outstanding and Revolving
Credit Commitments, a facility fee on the aggregate Term Loans outstanding and
Revolving Credit Commitments, in the case of the Revolving Credit Commitments,
regardless of usage, at the Applicable Fee Percentage.  In the event that the Revolving Credit
Commitments are terminated but Revolving Credit Loans or Letters of Credit
remain outstanding, then, the facility fee shall be paid on the aggregate
outstanding Loans and Letter of Credit Usage. 
The facility fee shall be payable in arrears on the last Business Day of
each March, June, September and December during the Facility Fee
Period and on the Maturity Date.


 


(b)                                 Letter of Credit Fee. 
During the Term, the Borrower shall pay to the Administrative Agent, for
the account of the Banks in proportion to their interests in respect of issued
and undrawn Letters of Credit, a fee (a “Letter of Credit Fee”) in an
amount, provided that no Event of Default shall have occurred and be
continuing, equal to a rate per annum equal to the then percentage per annum of
the Applicable Margin with respect to Euro-Currency Loans, on the daily average
of such issued and undrawn Letters of Credit, which fee shall be payable, in
arrears, on the last Business Day of each March, June, September and December during
the Term and on the Maturity Date.  From
the occurrence, and during the continuance, of an Event of Default, such fee
shall be increased by two percent (2%) per annum on the daily average of such
issued and undrawn Letters of Credit.


 


(c)                                  Fronting Bank Fee.  The
Borrower shall pay any Fronting Bank, for its own account, a fee (a “Fronting
Bank Fee”) at a rate per annum equal to the greater of (i) 0.10% of
the daily average issued and undrawn amount of each outstanding Letter of
Credit issued by such Fronting Bank and (ii) $1,000, which fee shall be in
addition to and not in lieu of, the Letter of Credit Fee.  The Fronting Bank Fee shall be payable in
arrears on the last Business Day of each March, June, September and December during
the Term and on the Maturity Date.


 


(d)                                 Fees Non-Refundable.  All
fees set forth in this Section 2.9 shall be deemed to have been earned on
the date payment is due in accordance with the provisions hereof and shall be
non-refundable.  The obligation of the
Borrower to pay such fees in accordance with the provisions hereof shall be
binding upon the Borrower and shall inure to the benefit of the Administrative
Agent and the Banks regardless of whether any Loans are actually made.


 


Section 2.10. Maturity Date.  The
term (the “Term”) of the Revolving Credit Commitments (and each Bank’s
obligations to make Revolving Credit Loans and to participate in Letters of
Credit hereunder) shall terminate and expire, and the Borrower shall return or
cause to be returned all Letters of Credit to the Fronting Bank, on the
Maturity Date.  Any Loans 


 


40

















 


outstanding on the Maturity Date (together with
accrued interest thereon and all other Obligations) shall be due and payable on
such date and any payment in respect of such Loans shall be made in the
currency in which such Loans are denominated.


 


Section 2.11. Optional Prepayments. 
Subject, in each case, to the Priority of Payments:


 


(a)                                  The Borrower may, upon at least one (1) Business
Day’s notice to the Administrative Agent, prepay any Group of Base Rate Loans,
in whole at any time, or from time to time in part in amounts aggregating
$1,000,000 or more, by paying the principal amount to be prepaid together with
accrued interest thereon to the date of prepayment.  The Borrower may, from time to time on any
Business Day so long as prior notice is given to the Administrative Agent and
Swingline Lender no later than 1:00 p.m. (New York City time) on the day
on which Borrower intends to make such prepayment, prepay any Swingline Loans
in whole or in part in amounts aggregating $100,000 or a higher integral
multiple of $100,000 (or, if less, the aggregate outstanding principal amount
of all Swingline Loans then outstanding) by paying the principal amount to be
prepaid together with accrued interest thereon to the date of prepayment.  Each such optional prepayment shall be
applied to prepay ratably the Loans of the several Banks (or the Swingline
Lender in the case of Swingline Loans) included in such Group of Loans or
Borrowing.


 


(b)                                 The Borrower may, upon at least three (3) Euro-Currency
Business Days’ notice to the Administrative Agent, given no later than 1:00 p.m.
(New York time, with respect to Dollar denominated Loans, and London time, with
respect to Multicurrency Revolving Credit Loans denominated in an Alternate Currency) prepay all, or from time to
time in part in amounts aggregating the Dollar Equivalent Amount of
approximately $5,000,000 or more, of any Group of Euro-Currency Loans as of the
last day of the Interest Period applicable thereto.  Except as provided in Article VIII, the
Borrower may not prepay all or any portion of the principal amount of any
Euro-Currency Loan prior to the end of the Interest Period applicable thereto
unless the Borrower shall also pay any applicable expenses pursuant to Section 2.16.  Any such prepayment notice shall be given on
or prior to the third (3rd) Euro-Currency Business Day prior to, but
excluding, the date of prepayment to the Administrative Agent.  Each such optional prepayment shall be
applied to prepay ratably the Loans of the Banks included in any Group of
Euro-Currency Loans.


 


(c)                                  The Borrower may at any time return any
undrawn Letter of Credit to the Fronting Bank in whole, but not in part, and
the Fronting Bank within a reasonable period of time shall give the
Administrative Agent and each of the Banks notice of such return.


 


(d)                                 The Borrower may at any time and from time to
time cancel all or any part of the unused Revolving Credit Commitments in
amounts aggregating $25,000,000 or a larger multiple of $1,000,000 by the
delivery to the Administrative Agent of a notice of cancellation within the
applicable time periods set forth in Section 2.11(a) and (b) if
there are Revolving Credit Loans then outstanding or, if there are no Revolving
Credit Loans outstanding at such time as to which the Revolving Credit
Commitments with respect thereto are being canceled, upon at least three (3) Business
Day’s  notice to the Administrative
Agent, whereupon, in either event, all or such portion of the Revolving Credit
Commitments, as applicable, shall terminate as 


 


41

















 


to the applicable Banks, pro rata on the date
set forth in such notice of cancellation, and, if there are any Revolving
Credit Loans then outstanding, the Borrower shall prepay, as applicable, all or
such portion of Revolving Credit Loans outstanding on such date that is greater
than the aggregate Revolving Credit Commitments after giving effect to such
termination in accordance with the requirements of Section 2.11(a) and
(b). The Borrower shall be permitted to designate in its notice of cancellation
which Group of Revolving Credit Loans, if any, are to be prepaid.  In the event the Borrower elects to cancel
all or any portion of the Revolving Credit Commitments pursuant to this Section 2.11(d),
such amounts may not be borrowed or reborrowed. 
A reduction of the Revolving Credit Commitments pursuant to this Section 2.11(d) shall
not effect a reduction in the Swingline Commitment (unless so elected by the
Borrower) until the aggregate Revolving Credit Commitments have been reduced to
an amount equal to or less than the Swingline Commitment.  A reduction of the Revolving Credit
Commitments pursuant to this Section 2.11(d) shall not effect a
reduction in the Swingline Commitment (unless so elected by the Borrower) until
the aggregate Revolving Credit Commitments have been reduced to an amount equal
to the Swingline Commitment.


 


(e)                                  Any
Revolving Credit Loans prepaid pursuant to Section 2.11(a) or (b) may
be reborrowed.  Any Term Loans prepaid may
not be reborrowed.  In the event the
Borrower elects to cancel all or any portion of the Revolving Credit
Commitments and the Swingline Commitment pursuant to Section 2.11(d) hereof,
such amounts may not be borrowed or reborrowed.


 


Section 2.12. Mandatory Prepayments; Cure.


 


(a)                                  Subject to the Priority of Payments, after
the occurrence and during the continuation of a Principal Collateral Payment
Event, any Principal Collateral Payments received by or on behalf of any Loan
Party shall, within three Business Days of receipt thereof, be applied toward
the prepayment of the Loans and Revolving Credit Commitment reductions.


 


(b)                                 Subject to the Priority of Payments, if, at
any time, the Borrower fails to satisfy the applicable Coverage Test, the
Borrower shall, within ten days after such failure, prepay the Loans and/or
cause the Subsidiaries party to the Security Agreement to pledge additional
Collateral under the Security Agreement and in accordance with the Loan
Documents, in a combined amount sufficient to cure such Coverage Test
deficiency (it being understood that the notice limitations in Section 2.11
shall not apply to any such prepayment but Section 2.16 shall apply
thereto).


 


(c)                                  The Administrative Agent shall calculate the
Dollar Equivalent Amount of any Multicurrency Revolving Credit Loan denominated
in an Alternate Currency at the time of each Borrowing thereof and on the last
Business Day of each calendar month.  If
at any such time the Dollar Equivalent Amount of the sum of all Multicurrency
Revolving Credit Loans, Swingline Loans and Letter of Credit Usage, as
determined by the Administrative Agent in accordance with the terms of this
Agreement, in the aggregate, exceeds 103% of the Multicurrency Revolving
Facility Amount, the Borrower, within three (3) Business Days after notice
thereof from the Administrative Agent, shall repay all or a portion of such
Loans or take such other actions, otherwise in accordance with the applicable
terms of this Agreement, in such amount so that, following the making of such
payment or action, the Dollar Equivalent Amount 


 


42

















 


outstanding of such Loans and Letter of
Credit Usage does not exceed the Multicurrency Revolving Facility Amount.


 


(d)                                 Amounts to be applied in connection with
prepayments of Loans and Revolving Credit Commitment reductions made pursuant
to clause (a) and (b) above shall be applied, (1) first,
to the prepayment of the Term Loans and (2) second, to
prepay Revolving Credit Loans and Swingline Loans (and, solely in the case of
mandatory prepayments made pursuant to clause (a) above, to reduce
permanently the Revolving Credit Commitments).  Any such permanent reduction
of the Revolving Credit Commitments shall be accompanied by prepayment of the
Revolving Credit Loans and/or Swingline Loans to the extent, if any, that the
aggregate amount of the Revolving Credit Loans outstanding, the Letter of
Credit Usage and the Swingline Loans outstanding exceeds the amount of the
Banks’ Revolving Credit Commitments as so reduced; provided that if the
aggregate principal amount of Revolving Credit Loans and Swingline Loans then
outstanding is less than the amount of such excess (because Letter of Credit
Usage constitutes a portion thereof), the Borrower shall, to the extent of the
balance of such excess, replace outstanding Letters of Credit and/or deposit
Letter of Credit Collateral in the Letter of Credit Collateral Account, with
interest accruing thereon in accordance with the provisions of Section 6.4.  Each
prepayment of the Loans under this Section 2.12 (except in the case of
Revolving Credit Loans that are Base Rate Loans and Swingline Loans) shall be
accompanied by accrued interest thereon to the date of such prepayment on the
amount prepaid.


 


(e)                                  Each mandatory prepayment and Commitment
reduction pursuant to clause (a), (b) or (c) above shall be applied
ratably according to the respective outstanding principal amounts of the Loans
being prepaid or Revolving Credit Commitments, as applicable, then held by the
Banks.  The application of any mandatory
prepayment pursuant to clause (a) or (b) above, if made in Dollars,
shall be made, first, to Base Rate Loans and, second, to
Euro-Currency Loans.  Each prepayment of
the Loans under this Section 2.12 shall be accompanied by accrued and
unpaid interest thereon to the date of such prepayment on the amount so
prepaid.


 


Section 2.13. Non-Pro Rata Prepayments. 
Notwithstanding anything to the contrary herein, the Borrower, with the
consent of the Banks whose Loans are to be prepaid pursuant to this Section 2.13,
shall be permitted to make non-pro rata optional prepayments of the Loans at a
Discount greater than or equal to 20% of the aggregate principal amount of
Loans to be so prepaid; provided that (i) the Loans so prepaid are
cancelled (and, in the case of any prepayment of Revolving Credit Loans
pursuant to this Section 2.13, a commensurate amount of the applicable
Bank’s Revolving Credit Commitment shall be concurrently cancelled and
thereafter, for purposes of determining borrowing amounts, obligations in
respect of Letters of Credit and Swingline Loans, repayment or prepayment of
principal, obligations under Section 7.6 and similar items (but not
payments of interest), such prepayment shall be treated to the extent applicable
as though it were the equivalent of the purchase of a “last-out” participation
in such Revolving Credit Commitment, (ii) any such prepayment is effected
in accordance with procedures reasonably satisfactory to the Joint Lead
Arrangers to ensure that each Bank has an opportunity to participate in such
prepayment on a ratable basis in proportion to the respective amounts of Loans
offered by each Bank to be subject to such prepayment, at the relevant price
and (iii) at the time of any such prepayment (x) no Default or Event
of Default has occurred or is continuing and (y) the Fixed Charge Coverage
Ratio is at least 1.25 to 1.00.  Any
prepayment under this Section 2.13 shall be subject to the consent of the
Administrative Agent, which shall 


 


43

















 


be granted unless
administrative responsibilities resulting from such prepayment would be unduly
burdensome, as determined by the Administrative Agent in its sole discretion.


 


Section 2.14. General Provisions as to Payments.


 


(a)                                  Notwithstanding anything to the contrary
herein, all payments made by the Borrower pursuant to Section 2.11 and Section 2.12
are subject to the Priority of Payments.


 


(b)                                 The Borrower shall make each payment of the
principal of and interest on the Loans and fees hereunder, without set-off or
counterclaim, by initiating a wire transfer not later than 1:00 p.m. (New
York City time or local time in the principal financial center of the Alternate
Currency in question, as applicable) on the date when due, of Federal funds or
the applicable Alternate Currency immediately available in New York, New York,
or, in the case of any Alternate Currency, the principal financial center of
the Alternate Currency in question, to the Administrative Agent at its address
referred to in Section 9.1, it being understood that written or facsimile
notice by the Borrower to the Administrative Agent to make a payment from the
funds in the Borrower’s account maintained at the Administrative Agent shall
constitute the making of such payment to the extent of such funds held in such
account.  The Administrative Agent will
promptly (and in any event within one (1) Business Day after receipt
thereof) distribute to each Bank its ratable share in accordance with the
amount of such Bank’s relevant outstanding Loans or Commitment, as the case may
be, of each such payment received by the Administrative Agent for the account
of the Banks.  If and to the extent that
the Administrative Agent shall receive any such payment for the account of the
Banks on or before 11:00 a.m. (New York City time or local time in the
principal financial center of the Alternate Currency in question, as
applicable) on any Business Day (or Euro-Currency Business Day, as applicable),
and the Administrative Agent shall not have distributed to any Bank its
applicable share of such payment on such day, the Administrative Agent shall
distribute such amount to such Bank together with interest thereon, for each
day from the date such amount should have been distributed to such Bank until
the date the Administrative Agent distributes such amount to such Bank, at the
Federal Funds Rate with respect to Dollar denominated Loans and at the
Administrative Agent’s cost of funds for the applicable Alternate Currency with
respect to Multicurrency Revolving Credit Loans denominated in an Alternate Currency.  Whenever any payment of principal of, or
interest on the Base Rate Loans or Swingline Loans or of fees shall be due on a
day which is not a Business Day, the date for payment thereof shall be extended
to the next succeeding Business Day. 
Whenever any payment of principal of, or interest on, the Euro-Currency
Loans shall be due on a day which is not a Euro-Currency Business Day, the date
for payment thereof shall be extended to the next succeeding Euro-Currency
Business Day unless such Euro-Currency Business Day falls in another calendar
month, in which case the date for payment thereof shall be the immediately
preceding Euro-Currency Business Day.  If
the date for any payment of principal is extended by operation of law or
otherwise, interest thereon shall be payable for such extended time.  All repayments or prepayments of any
Loans, and all interest paid on any Loan (whether regularly scheduled, upon
repayment or prepayment or otherwise), hereunder shall be made in the currency
in which such Loans are denominated, and all other payments under this
Agreement shall, unless otherwise specified herein, be made in Dollars.


 


(c)                                  Unless the Administrative Agent shall have
received notice from the Borrower prior to the date on which any payment is due
to the Banks hereunder that the 


 


44

















 


Borrower will not make such payment in full,
the Administrative Agent may assume that the Borrower has made such payment in
full to the Administrative Agent on such date and the Administrative Agent may,
in reliance upon such assumption, cause to be distributed to each Bank on such
due date an amount equal to the amount then due such Bank.  If and to the extent that the Borrower shall
not have so made such payment, each Bank shall repay to the Administrative
Agent forthwith on demand such amount distributed to such Bank together with
interest thereon, for each day from the date such amount is distributed to such
Bank until the date such Bank repays such amount to the Administrative Agent,
at the Federal Funds Rate.


 


Section 2.15. Priority of Payments.  (a) Any payments made by the
Borrower pursuant to Sections 2.11 and 2.12 shall be applied to and among the First
Priority Credit Agreement, the 2012 Second Priority Credit Agreement and this
Agreement as set forth in clauses (b) and (c) below (the provisions
of this Section 2.15 are collectively referred to as the “Priority of
Payments”).


 


(b)                                 Any
voluntary prepayments made pursuant to Section 2.11 or the equivalent
provisions under the First Priority Credit Agreement or the 2012 Second
Priority Credit Agreement shall be applied (1) first, to prepay the
loans outstanding under the First Priority Credit Agreement or to reduce the
commitments thereunder, (2) second, to prepay the Term Loans
outstanding under this Agreement, and (3) third, to prepay the term
loans outstanding under the 2012 Second Priority Credit Agreement; provided,
however, that if (a) the loans and other obligations outstanding under the
First Priority Credit Agreement have been paid in full and the commitments
thereunder have been terminated and (b)(i) a Default or Event of Default
has occurred and is continuing or (ii) the Fixed Charge Coverage Ratio is
less than 1.25:1.00 as of the date of determination, then any such voluntary
prepayment shall be applied on a pro  rata basis as between the
term loans outstanding under the 2012 Second Priority Credit Agreement and the
Term Loans outstanding under this Agreement; provided  further,
that, notwithstanding the foregoing, the Borrower shall at any time other than
when a Default or Event of Default has occurred and is continuing, be permitted
to prepay or repay revolving credit loans, swingline loans and letter of credit
reimbursement obligations outstanding under the Second Priority Bank Facilities
and, upon any such prepayment, there shall be no corresponding reduction of the
commitments thereunder.


 


(c)                                  Any
mandatory prepayments made pursuant to Section 2.12(a) or (b) or
the equivalent provisions under the First Priority Credit Agreement or the 2012
Second Priority Credit Agreement shall be applied (1) first, to
prepay loans outstanding under the First Priority Credit Agreement (provided
that if the amount of any such mandatory prepayment is greater than the
aggregate principal amount of loans then outstanding under the First Priority
Credit Agreement, then the excess amount of such prepayment (after giving
effect to the prepayment of all outstanding loans under the First Priority
Credit Agreement) shall instead reduce the unused commitments thereunder and
such excess amount (in an amount not to exceed the aggregate amount of unused
commitments thereunder) shall be placed in escrow at an account maintained at
the Administrative Agent), (2) second, to prepay the Term Loans
outstanding under this Agreement, (3) third, to prepay the term
loans outstanding under the 2012 Second Priority Credit Agreement, (4) fourth,
to prepay Revolving Credit Loans, Swingline Loans and Letter of Credit
reimbursement obligations (and, solely in the case of mandatory prepayments
made pursuant to Section 2.12(a), to reduce permanently the Revolving
Credit Commitments) outstanding under 


 


45

















 


this Agreement, and (5) fifth,
to prepay revolving credit loans, swingline loans and letter of credit
reimbursement obligations (and, solely in the case of mandatory prepayments
made pursuant to Section 2.12(a), to reduce permanently the revolving credit
commitments) outstanding under the 2012 Second Priority Credit Agreement.


 


Section 2.16. Funding Losses.  If
the Borrower makes any payment of principal with respect to any Euro-Currency
Loan (pursuant to Article II, VI or VIII or otherwise) on any day other
than the last day of the Interest Period applicable thereto, or if the Borrower
fails to borrow any Euro-Currency Loans after notice has been given to any Bank
in accordance with Section 2.5(a), or if the Borrower shall deliver a
Notice of Interest Rate Election specifying that a Euro-Currency Loan shall be
converted on a date other than the first (1st) day of the then current Interest
Period applicable thereto, the Borrower shall reimburse each Bank within 15
days after certification by such Bank of such loss or expense (which shall be
delivered by each such Bank to the Administrative Agent for delivery to the
Borrower) for any resulting loss (based on interest only, exclusive of fees, if
any) or expense incurred by it (or by an existing Participant in the related
Loan), including, without limitation, any loss incurred in obtaining,
liquidating or employing deposits from third parties, but excluding loss of
margin for the period after any such payment or failure to borrow; provided
that such Bank shall have delivered to the Administrative Agent and the
Administrative Agent shall have delivered to the Borrower a certification as to
the amount of such loss or expense, which certification shall set forth in
reasonable detail the basis for and calculation of such loss or expense and
shall be conclusive in the absence of demonstrable error.


 


Section 2.17. Computation of Interest and Fees.  With
respect to Base Rate Loans, the rate of interest on which is calculated based
on the Prime Rate or for Euro-Currency Loans denominated in British Pounds
Sterling hereunder, interest thereon shall be computed on the basis of a year
of 365 days (or, in the case of interest based on the Prime Rate only, 366 days
in a leap year) and paid for the actual number of days elapsed (including the
first day but excluding the last day). 
All other interest and fees shall be computed on the basis of a year of
360 days and paid for the actual number of days elapsed (including the first
day but excluding the last day).


 


Section 2.18. Use of Proceeds.  The
Borrower shall use the proceeds of the Loans for general corporate purposes,
including, without limitation, the origination, acquisition and funding of Loan
Assets, Credit Tenant Lease Assets and other investments, the repayment of maturing
debt obligations, the repurchase or exchange of public notes of the Borrower,
the acquisition of other assets, and for general working capital needs of the
Borrower, in each case, in accordance with and subject to the terms and
conditions of this Agreement.


 


Section 2.19. Letters of Credit.


 


(a)                                  On and after the Closing Date the Existing
Letters of Credit will constitute Letters of Credit under this Agreement and
for purposes hereof will be deemed to have been issued by the Fronting Bank on
the Closing Date.  Each Bank shall be
deemed to have participated in such Existing Letters of Credit in accordance
with its Pro Rata Share of the Revolving Credit Commitments.  No Existing Letter of Credit is denominated
in any currency other than Dollars.


 


46

















 


(b)                                 Subject to the terms contained in this
Agreement and the other Loan Documents, upon the receipt of a notice in
accordance with Section 2.3(b) requesting the issuance of a Letter of
Credit, the Fronting Bank shall issue a Letter of Credit or Letters of Credit
in such form as is reasonably acceptable to the Borrower (subject to the
provisions of Section 2.3(b)) in Dollars and in an amount or amounts equal
to the amount or amounts requested by the Borrower.


 


(c)                                  Each Letter of Credit shall be issued in the
minimum amount of $100,000 or such lesser amount as may be agreed to by the
Fronting Bank.


 


(d)                                 The Letter of Credit Usage shall be no more
than $75,000,000.


 


(e)                                  Without the consent of the Administrative Agent,
there shall be no more than ten (10) Letters of Credit outstanding at any
one time.


 


(f)                                    In the event of any request for a drawing
under any Letter of Credit by the beneficiary thereunder, the Fronting Bank
shall notify the Borrower and the Administrative Agent (and the Administrative
Agent shall notify each Bank thereof) on the same Business Day as such request
for drawing, and, except as provided in this subsection (f), the Borrower shall
reimburse the Fronting Bank, in immediately available funds, on the same day on
which such drawing is honored in an amount equal to such drawing.
Notwithstanding anything contained herein to the contrary, however, unless the
Borrower shall have notified the Administrative Agent and the Fronting Bank
prior to 1:00 p.m. (New York City time) on the Business Day immediately
preceding the date of such drawing that the Borrower intends to reimburse the
Fronting Bank for the amount of such drawing with funds other than the proceeds
of the Loans, the Borrower shall be deemed to have timely given a Notice of
Borrowing pursuant to Section 2.3 to the Administrative Agent, requesting
a Base Rate Borrowing of Revolving Credit Loans on the date on which such
drawing is honored and in an amount equal to the such drawing. Each Bank shall,
in accordance with Section 2.5(b), make available its Pro Rata Share of
such Borrowing to the Administrative Agent, the proceeds of which shall be
applied directly by the Administrative Agent to reimburse the Fronting Bank for
the amount equal to the Dollar Equivalent Amount of such draw.  In the event that any Bank fails to make
available to the Fronting Bank the amount of such Bank’s participation on the
date of a drawing, the Fronting Bank shall be entitled to recover such amount
on demand from such Bank together with interest at the Federal Funds Rate
commencing on the date such drawing is honored.


 


(g)                                 If, at the time a beneficiary under any
Letter of Credit requests a drawing thereunder, an Event of Default as
described in Section 6.1(f) or Section 6.1(g) shall have
occurred and is continuing, then on the date on which the Fronting Bank shall
have honored such drawing, the Borrower shall have an unreimbursed obligation
(the “Unreimbursed Obligation”) to the Fronting Bank in an amount equal
to the amount of such drawing, which amount shall bear interest  at the annual rate of the sum of the Base
Rate and the Applicable Margin for Base Rate Loans plus two percent (2%). Each
Bank shall purchase an undivided participating interest in such drawing in an amount
equal to its Pro Rata Share of the Revolving Credit Commitments, and upon
receipt thereof the Fronting Bank shall deliver to such Bank an Unreimbursed
Obligation participation certificate dated the date of the Fronting Bank’s
receipt of such funds and in the amount of such Bank’s Pro Rata Share.


 


47
















 


(h)           If, after the date hereof, any change in any law or
regulation or in the interpretation thereof by any court or administrative or
governmental authority charged with the administration thereof shall either (i) impose,
modify or deem applicable any reserve, special deposit or similar requirement
against letters of credit issued by, or assets held by, or deposits in or for
the account of, or participations in any letter of credit, upon any Bank
(including the Fronting Bank) or (ii) impose on any Bank any other
condition regarding this Agreement or such Bank (including the Fronting Bank)
as it pertains to the Letters of Credit or any participation therein and the
result of any event referred to in the preceding clause (i) or (ii) shall
be to increase, by an amount deemed by the Fronting Bank or such Bank to be
material, the cost to the Fronting Bank or any Bank of issuing or maintaining
any Letter of Credit or participating therein, then the Borrower shall pay to
the Fronting Bank or such Bank, within 15 days after written demand by such
Bank (with a copy to the Administrative Agent), which demand shall be
accompanied by a certificate showing, in reasonable detail, the calculation of
such amount or amounts, such additional amounts as shall be required to compensate
the Fronting Bank or such Bank for such increased costs or reduction in amounts
received or receivable hereunder.  Each
Bank will promptly notify the Borrower and the Administrative Agent of any
event of which it has knowledge, occurring after the date hereof, which will
entitle such Bank to compensation pursuant to this Section 2.19(h) and
will designate a different Applicable Lending Office if such designation will
avoid the need for, or reduce the amount of, such compensation and will not, in
the reasonable judgment of such Bank, be otherwise disadvantageous to such
Bank.  If such Bank shall fail to notify
Borrower of any such event within 90 days following the end of the month during
which such event occurred, then Borrower’s liability for any amounts described
in this Section incurred by such Bank as a result of such event shall be
limited to those attributable to the period occurring subsequent to the
ninetieth (90th) day prior to, but excluding, the date upon which such Bank
actually notified Borrower of the occurrence of such event.  A certificate of any Bank claiming
compensation under this Section 2.19(h) and setting forth a
reasonably detailed calculation of the additional amount or amounts to be paid
to it hereunder shall be conclusive in the absence of demonstrable error.  In determining such amount, such Bank may use
any reasonable averaging and attribution methods.


 


(i)            The Borrower hereby agrees to protect, indemnify, pay and
save the Fronting Bank harmless from and against any and all claims, demands,
liabilities, damages, losses, costs, charges and expenses (including reasonable
and documented attorneys’ fees and disbursements) which the Fronting Bank may
incur or be subject to as a result of (i) the issuance of the Letters of
Credit, other than to the extent of the bad faith, gross negligence or willful
misconduct of the Fronting Bank or (ii) the failure of the Fronting Bank
to honor a drawing under any Letter of Credit as a result of any act or
omission, whether rightful or wrongful, of any present or future de jure
or de facto government or governmental authority (collectively, “Governmental
Acts”), other than to the extent of the bad faith, gross negligence or
willful misconduct of the Fronting Bank. As between the Borrower and the Fronting
Bank, the Borrower assumes all risks of the acts and omissions of any
beneficiary with respect to its use, or misuses of, the Letters of Credit
issued by the Fronting Bank.  In
furtherance and not in limitation of the foregoing, the Fronting Bank shall not
be responsible (i) for the form, validity, sufficiency, accuracy,
genuineness or legal effect of any document submitted by any party in
connection with the application for and issuance of such Letters of Credit,
even if it should in fact prove to be in any or all respects invalid,
insufficient, inaccurate, fraudulent or forged; (ii) for the validity or
insufficiency of any instrument transferring or assigning or purporting to
transfer or assign any 


 


48

















 


such Letter of Credit or the rights or benefits thereunder or proceeds
thereof, in whole or in part, which may prove to be invalid or ineffective for
any reason; (iii) for failure of the beneficiary of any such Letter of
Credit to comply fully with conditions required in order to draw upon such
Letter of Credit, other than as a result of the bad faith, gross negligence or
willful misconduct of the Fronting Bank; (iv) for errors, omissions,
interruptions or delays in transmission or delivery of any message, by mail,
cable, telegraph, facsimile transmission, or otherwise; (v) for errors in
interpretation of any technical terms; (vi) for any loss or delay in the
transmission or otherwise of any documents required in order to make a drawing
under any such Letter of Credit or of the proceeds thereof; (vii) for the
misapplication by the beneficiary of any such Letter of Credit of the proceeds
of such Letter of Credit; and (viii) for any consequence arising from
causes beyond the control of the Fronting Bank, including any Government Acts,
in each case other than to the extent of the bad faith, gross negligence or
willful misconduct of the Fronting Bank. None of the above shall affect, impair
or prevent the vesting of the Fronting Bank’s rights and powers hereunder.  In furtherance and extension and not in
limitation of the specific provisions hereinabove set forth, any action taken
or omitted by the Fronting Bank under or in connection with the Letters of
Credit issued by it or the related certificates, if taken or omitted in good
faith, shall not put the Fronting Bank under any resulting liability to the
Borrower; provided that, notwithstanding anything in the foregoing to the
contrary, the Fronting Bank will be liable to the Borrower for any damages
suffered by the Borrower or its Subsidiaries as a result of the Fronting Bank’s
grossly negligent or willful failure to pay under any Letter of Credit after
the presentation to it of a sight draft and certificates strictly in compliance
with the terms and conditions of such Letter of Credit.


 


(j)            If the Fronting Bank or the Administrative Agent is
required at any time, pursuant to any bankruptcy, insolvency, liquidation or
reorganization law or otherwise, to return to the Borrower any reimbursement by
the Borrower of any drawing under any Letter of Credit, each Bank shall pay to
the Fronting Bank or the Administrative Agent, as the case may be, its Pro Rata
Share of such payment, but without interest thereon unless the Fronting Bank or
the Administrative Agent is required to pay interest on such amounts to the
person recovering such payment, in which case with interest thereon, computed
at the same rate, and on the same basis, as the interest that the Fronting Bank
or the Administrative Agent is required to pay.


 


Section 2.20. Letter of Credit Usage Absolute.  The
obligations of the Borrower under this Agreement in respect of any Letter of
Credit shall be unconditional and irrevocable, and shall be paid strictly in
accordance with the terms of this Agreement (as the same may be amended from
time to time) and any Letter of Credit Documents (as hereinafter defined) under
all circumstances, including, without limitation, to the extent permitted by
law, the following circumstances:


 


(a)           any lack of validity or enforceability of any Letter of
Credit or any other agreement or instrument relating thereto (collectively, the
“Letter of Credit Documents”) or any Loan Document;


 


(b)           any change in the time, manner or place of payment of, or
in any other term of, all or any of the obligations of the Borrower in respect
of the Letters of Credit or any other amendment or waiver of or any consent by
the Borrower to departure from all or any of the Letter of Credit Documents or
any Loan Document; provided, that the Fronting Bank shall not 


 


49

















 


consent to any such change or amendment unless previously consented to
in writing by the Borrower;


 


(c)           any exchange, release or non-perfection of any collateral,
or any release or amendment or waiver of or consent to departure from any
guaranty, for all or any of the obligations of the Borrower in respect of the
Letters of Credit;


 


(d)           the existence of any claim, set-off, defense or other
right that the Borrower may have at any time against any beneficiary or any
transferee of a Letter of Credit (or any Persons for whom any such beneficiary
or any such transferee may be acting), the Administrative Agent, the Fronting
Bank or any Bank (other than a defense based on the bad faith, gross negligence
or willful misconduct of the Administrative Agent, the Fronting Bank or such
Bank) or any other Person, whether in connection with the Loan Documents, the
transactions contemplated hereby or by the Letters of Credit Documents or any
unrelated transaction;


 


(e)           any draft or any other document presented under or in
connection with any Letter of Credit or other Loan Document proving to be
forged, fraudulent, invalid or insufficient in any respect or any statement
therein being untrue or inaccurate in any respect; provided, that
payment by the Fronting Bank under such Letter of Credit against presentation
of such draft or document shall not have been the result of the bad faith,
gross negligence or willful misconduct of the Fronting Bank;


 


(f)            payment by the Fronting Bank against presentation of a
draft or certificate that does not strictly comply with the terms of the Letter
of Credit; provided, that such payment shall not have been the result of
the bad faith, gross negligence or willful misconduct of the Fronting Bank; and


 


(g)           any other circumstance or happening whatsoever other than
the payment in full of all obligations hereunder in respect of any Letter of
Credit or any agreement or instrument relating to any Letter of Credit, whether
or not similar to any of the foregoing, that might otherwise constitute a
defense available to, or a discharge of, the Borrower; provided, that
such other circumstance or happening shall not have been the result of bad
faith, gross negligence or willful misconduct of the Fronting Bank.


 


Section 2.21. Letters of Credit Maturing after the Maturity
Date.


 


(a)           Notwithstanding anything contained herein to the contrary,
if any Letters of Credit, by their terms, shall mature after the Maturity Date
(as the same may be extended), then, on and after the Maturity Date, the
provisions of this Agreement shall remain in full force and effect with respect
to such Letters of Credit, and the Borrower shall comply with the provisions of
Section 2.21(b).  No Letter of
Credit shall mature on a date that is more than twelve (12) months after the
Maturity Date.


 


(b)           If, at any time and from time to time, any Letter of
Credit shall have been issued hereunder and the same shall expire on a date
after the Maturity Date, then, on the issuance thereof, the Borrower shall pay
to the Administrative Agent, on behalf of the Banks, in same day funds at the
Administrative Agent’s office designated in such demand, for deposit in 


 


50

















 


the Letter of Credit Collateral Account, Letter of Credit Collateral in
an amount equal to the maximum amount available to be drawn under such Letter
of Credit as of such date of determination; provided, however, that the
foregoing shall not apply to any “evergreen” Letter of Credit unless (i) its
initial expiration date is after the Maturity Date or (ii) such Letter of
Credit is renewed and, as a result thereof, the next expiry date or the
following renewal date is scheduled on a date after the Maturity Date; and, provided,
further, however, that the maximum amount available to be drawn under
any Letter of Credit cash collateralized as required by this sentence shall be
disregarded for purposes of determining compliance with the Coverage
Ratio.  Interest shall accrue on the
Letter of Credit Collateral Account in accordance with the provisions of Section 6.4.


 


Section 2.22. Payments.  If any Bank shall fail
to make any payment required to be made by it pursuant to Section 2.4(b)(iii),
2.4(b)(iv), 2.5(d), 2.19(f), 2.19(g) or 7.6, then the Administrative Agent
may, in its sole discretion (notwithstanding any contrary provision of this
Agreement), apply any amounts thereafter received by the Administrative Agent,
the Swingline Lender or the Fronting Bank for the account of such Bank to
satisfy such Bank’s obligations under such Sections until all such unsatisfied
obligations are fully paid; and if such Bank shall have failed to make any
payment required to be made by it pursuant to any equivalent provision under
either the 2012 Second Priority Credit Agreement or the First Priority Credit
Agreement and there are no such unsatisfied obligations hereunder, then the
Administrative Agent may apply any such amounts received by it for the account
of such Bank to satisfy such Bank’s obligations under the equivalent provisions
under either the 2012 Second Priority Credit Agreement or the First Priority
Credit Agreement (or, in the event the institution serving as Administrative
Agent hereunder is not, at such time, the same institution serving as
administrative agent under either the 2012 Second Priority Credit Agreement or
the First Priority Credit Agreement, turn over such amounts to the applicable
administrative agent under the 2012 Second Priority Credit Agreement or the
First Priority Credit Agreement to be applied for such purposes).


 


Section 2.23. Collateral.  (a)  The Obligations
shall be secured by a perfected second priority security interest in the
Collateral, subject only to the first priority Lien granted pursuant to
the Security Agreement for the benefit of the First Priority Secured Parties.  The
Borrower shall be entitled to withdraw Collateral in inverse order of the
ranking of such Collateral on the Pledged Collateral List (it being understood
that any asset so withdrawn shall be automatically included in the Listed
Eligible Assets as the highest ranked asset (and the list shall be adjusted
accordingly)) so long as, both immediately before and after giving effect to
such withdrawal, (i) no Material Default or Event of Default shall have
occurred and be continuing (or shall result therefrom) and (ii) except for
any such withdrawal which the Borrower reasonably determines is necessary for
compliance with any covenant applicable under the terms of any Indebtedness of
the Borrower as in effect on the Closing Date relating to the maintenance of “Total
Unencumbered Assets” (or any similar concept), the Fixed Charge Coverage Ratio
at the time of such withdrawal is at least 1.25 to 1.00.  Notwithstanding any other provisions in this Section 2.23,
Non-Performing Loan Assets and Other Real Estate Owned Assets that are
disregarded in calculating the aggregate Borrowing Base Value as provided in
the definition of “Borrowing Base Value” may, so long as no Material Default or
Event of Default shall have occurred and be continuing (or shall result
therefrom), be withdrawn, at the option of the Borrower, to the extent of any
amount so disregarded; provided that at the time of such 


 


51

















 


withdrawal of any such assets, the Joint Lead Arrangers shall have the
right, but not the obligation, to rank such assets as Listed Eligible
Assets.  Notwithstanding any other
provisions in this Section 2.23, (x) the Borrower shall be entitled
to withdraw Collateral in connection with payment or prepayment of such
Collateral and (y) the Borrower shall be permitted to withdraw such
Collateral in connection with sales to third parties or a monetization (that is
not a payment or prepayment) (any such 
monetization or sale, a “Third Party Sale”) provided that in
connection with any such Third Party Sale and after giving effect to such Third
Party Sale and the prior addition (a “Collateral Addition”) of any replacement
Collateral (which replacement Collateral shall comprise the highest ranked Listed
Eligible Assets immediately prior to such replacement and the lowest ranked
Collateral on the Pledged Collateral List immediately following such
replacement), either (I) no Material Default or Event of Default shall
have occurred and be continuing or (II) a Material Default or Event of
Default shall have occurred and be continuing, but such Third Party Sale is
consummated pursuant to a binding commitment entered into at a time that no
Material Default or Event of Default had occurred and was continuing or would
have resulted therefrom (it being understood that the proceeds of any such
transaction described in clause (x) or (y) above shall be paid into
the accounts established pursuant to Section 5.8).  At such time as any Listed Eligible Assets
are required to be pledged as Collateral in order to comply with the terms
hereof, the Borrower shall (i) cause a sufficient amount of the highest
ranked Listed Eligible Assets to be transferred to a Collateral SPV and (ii) take
any other actions as the Administrative Agent or the Collateral Trustee may
reasonably request for the purposes of fully perfecting or renewing the rights
and security interests of the Collateral Trustee, on behalf of the Banks, with
respect to the Collateral.


 


In addition to Collateral withdrawals otherwise permitted pursuant to
this Agreement or any other Loan Document, promissory notes and related
transfer documents, if any, constituting part of any Collateral (and any
related collateral) if requested by the Borrower at any time prior to the
commencement of a Foreclosure (as defined in the Collateral Trust Agreement) in
respect thereof, shall be released by the Collateral Trustee to the custody of
the Borrower, the applicable Grantor or its agents in escrow pending any
enforcement action, exercise of rights or other customary actions in lieu of
enforcement or for the purpose of correction of defects, if any, in each case
in respect of any such promissory notes and related collateral.  It is understood and agreed that any
Collateral released pursuant to the foregoing sentence shall remain Collateral
except in connection with a withdrawal otherwise permitted pursuant to this
Agreement or any other Loan Document.


 


(b)           Beginning on October 15, 2009
and on each April 15th and October 15th thereafter (or, if such day is not a Business
Day, the next following Business Day), the Joint Lead Arrangers shall (i) in
consultation with Barclays Bank PLC,
Wachovia Bank, National Association and Deutsche Bank AG New York Branch (in each case so long as it shall
be a Bank under this Agreement or either of the New Credit Agreements) (each, a
“Consulting Bank”) undertake a review to determine if any re-ranking of
the Listed Eligible Assets and/or the Pledged Collateral List is appropriate,
and (ii) if any such re-ranking is appropriate, undertake such re-ranking,
in their sole and absolute discretion, in consultation with the Consulting
Banks.  In connection with any such
re-ranking, the Borrower shall cooperate with the Joint Lead Arrangers in any
diligence, including providing information related to the Collateral and the
Listed Eligible Assets, reasonably requested by the Joint Lead Arrangers for
purposes of such re-ranking.  Each
inclusion of assets in the Collateral shall be in the order of the then-current



 


52

















 


ranking of Listed Eligible Assets and,
following inclusion, such assets shall constitute the lowest ranked Collateral
on the Pledged Collateral List.  Any
increase in the funding of any asset included in the Collateral or Listed
Eligible Assets shall be considered part of such asset and shall be included in
the Borrowing Base Value thereof.


 


(c)           Any newly originated or acquired
assets or assets that become available that were previously pledged or mortgaged
as collateral in connection with the DB Master Repurchase Agreement or the GE
Credit Tenant Lease Facility that qualify as Eligible Assets shall be
automatically included in the Listed Eligible Assets (and the Joint Lead
Arrangers may re-rank the Listed Eligible Assets in connection therewith, in consultation with the Consulting Banks). 
Any Fremont Asset that qualifies as an Eligible Asset, immediately as of the
time it is no longer subject to the Fremont Participation Agreement, shall be
automatically included in the Listed Eligible Assets.  Notwithstanding anything to the contrary
herein, at the time any Fremont Assets are added to Listed Eligible Assets and
once the Joint Lead Arrangers have been afforded a reasonable opportunity to
rank such assets, in consultation with
the Consulting Banks, in a special one-time reranking of Listed Eligible
Assets (the “Special Fremont Reranking”), the Joint Lead Arrangers may
effect substitutions of the Collateral with any Listed Eligible Assets.


 


Section 2.24.
Mortgages.  The
Borrower shall cause the applicable Pledged Collateral LLCs to execute and
deliver to the Collateral Trustee, not later than 90 days after the Closing
Date, Mortgages with respect to real properties that constitute Credit Tenant
Lease Assets owned by such Pledged Collateral LLCs comprising not less than 50%
of the Borrowing Base Value of all Mortgage Eligible Assets; provided
that (i) Mortgages shall not be required to be delivered with respect to
any Mortgage-Exempt Asset, (ii) the Mortgaged Properties, at any time,
shall be comprised of the highest ranked Mortgage-Eligible Assets from the
Pledged Collateral List in effect at the time of the delivery of the Mortgage
in respect of each Mortgaged Property (it being understood that no Mortgage will
be required to be delivered solely because of a re-ranking of the Listed
Eligible Assets and/or the Pledged Collateral List), and (iii) each
Mortgage required to be delivered pursuant to this Section 2.24 shall
secure 50% of the undepreciated book value of the applicable Credit Tenant
Lease Asset (reflecting any impairment taken by the applicable Collateral LLC
but without adding back any depreciation before the most recent such
impairment) at the time such Mortgage is entered in to.  Following the date that is 90 days after the
Closing Date, the Borrower shall cause Mortgages in compliance with this Section 2.24
to be delivered as necessary so that at all times the Mortgaged Properties
shall comprise not less than 50% of the Borrowing Base Value of all Mortgage-Eligible
Assets.  Notwithstanding anything to the
contrary in this Section 2.24, neither the Borrower nor any Grantor shall
be required to deliver environmental reports, third-party reports, appraisals,
surveys, title insurance policies, tract searches or legal opinions in respect
of any Mortgaged Property or Mortgage thereon.


 


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ARTICLE III




CONDITIONS


 


Section 3.1. Closing.  The Closing Date shall occur
on the date when each of the following conditions is satisfied (or waived in
writing by the Administrative Agent and the Banks), each document to be dated
the Closing Date unless otherwise indicated:


(a)           the Borrower as of the Closing Date shall have executed
and delivered to the Administrative Agent a Note or Notes for the account of
each Bank requesting the same dated the Closing Date and complying with the
provisions of Section 2.6;


 


(b)           the Borrower and the Administrative Agent and each of the
Banks shall have executed and delivered to the Administrative Agent a duly
executed original of this Agreement;


 


(c)           each Guarantor shall have executed and delivered to the
Administrative Agent a duly executed original of the Guarantee Agreement;


 


(d)           each Grantor and the Collateral
Trustee shall have executed and delivered to the Administrative Agent a duly
executed original of the Security Agreement;


 


(e)            each Guarantor, the Collateral
Trustee and each other party thereto shall have executed and delivered to the
Administrative Agent a duly executed original of the Collateral Trust
Agreement;


 


(f)            the Collateral Trustee shall have
received any notes or other evidence of Indebtedness (if any) representing
Collateral pledged under the Security Agreement and required to be delivered
thereunder as of the Closing Date and appropriate transfer documents with
respect to any Loan Assets included in the Collateral as of the Closing Date,
signed in blank by the appropriate Collateral SPV; the Collateral Account (as
defined in the Collateral Trust Agreement) shall have been established; and,
each document (including, without limitation, any Uniform Commercial Code
financing statement to be filed in the jurisdiction of organization of each
Grantor) required by the Security Agreement or under law or reasonably
requested by the Administrative Agent to be filed, registered, recorded or
delivered in order to create or perfect the Liens intended to be created under
the Security Agreement shall have been delivered to the Administrative Agent in
proper form for filing, registration or recordation (if applicable);


 


(g)           the Administrative Agent shall have received opinions of (i) Clifford
Chance US LLP, special counsel for the Borrower, and (ii) Geoffrey Dugan, Esq.,
in-house counsel for the Borrower, each acceptable to the Administrative Agent,
the Banks and their counsel;


 


(h)           the Administrative Agent shall have received all documents
the Administrative Agent may reasonably request relating to the existence of
the Borrower, each Collateral SPV, each Collateral LLC the equity interests in
which are pledged as Collateral and any other Guarantor as of the Closing Date,
the authority for and the validity of this Agreement 


 


54

















 


and the other Loan Documents, the incumbency of officers executing this
Agreement and the other Loan Documents and any other matters relevant hereto,
all in form and substance satisfactory to the Administrative Agent.  Such documentation shall include, without
limitation, the articles of incorporation, certificate of formation or similar
organizational document of each such entity, as amended, modified or
supplemented on or prior to the Closing Date, certified to be true, correct and
complete by a senior officer of such entity as of a date not more than ten (10) days
prior to the Closing Date, together with a good standing certificate as to each
such entity from the Secretary of State (or the equivalent thereof) of its
jurisdiction of organization, to be dated not more than thirty (30) days prior
to the Closing Date.  Any such
organizational documents of each Collateral SPV and each Collateral LLC shall
provide for, and require that there at all times be, a special director or
member selected by the Administrative Agent whose consent would be required for
a bankruptcy filing by such Collateral SPV or Collateral LLC or for the
transfer of any equity interests therein (other than the sale of such
equity interests in a transaction permitted under the Loan Documents);


 


(i)            the Borrower shall have executed a solvency certificate acceptable
to the Administrative Agent;


 


(j)            the Administrative Agent shall have received all
certificates, agreements and other documents and papers referred to in this Section 3.1
and the Notice of Borrowing referred to in Section 2.3, if applicable, unless
otherwise specified, in sufficient counterparts, satisfactory in form and
substance to the Administrative Agent in its reasonable discretion;


 


(k)           the Borrower and each other Loan Party shall have taken
all actions required to authorize the execution and delivery of this Agreement
and any other Loan Document to which it is a party and the performance thereof
by the Borrower or such Loan Party, as applicable;


 


(l)            the Banks shall be satisfied that the Borrower is not
subject to any present or contingent Environmental Claim, and the Borrower
shall have delivered a certificate so stating;


 


(m)          (i) the Administrative Agent shall have received, on
or before the Closing Date, all other fees required to be paid, and all
expenses for which invoices have been presented and (ii) the reasonable
and documented fees and expenses accrued through the Closing Date of Simpson
Thacher & Bartlett LLP shall have been paid to Simpson Thacher &
Bartlett LLP;


 


(n)           the Borrower shall have delivered copies of all consents,
licenses and approvals, if any, (subject to Section 4.3) required in
connection with the execution, delivery and performance by the Borrower or any
Guarantor, or the validity and enforceability, of the Loan Documents, or in
connection with any of the transactions contemplated thereby, and such
consents, licenses and approvals shall be in full force and effect;


 


(o)           no Default or Event of Default shall have occurred and be
continuing before or immediately after giving effect to the transactions
contemplated hereby;


 


55

















 


(p)           the Borrower shall have delivered a certificate in form
acceptable to the Administrative Agent showing compliance with the requirements
of Section 5.10 as of the Closing Date;


 


(q)           the Borrower shall have delivered Cash Flow Projections
which shall include (x) the Borrower’s projected sources and uses of cash
(and the timing thereof) through a date that is on or after June 26, 2012
and (y) that such sources are at all times sufficient for such uses;


 


(r)            (i) the Existing 2006 Credit Agreement shall have
either (A) if all lenders thereunder have executed a satisfactory Consent
and Addendum to the Existing 2006 Credit Agreement Amendment and Commitment
Transfer Agreement, been terminated (and all loans thereunder and other amounts
payable in respect thereof shall have been paid in full and all commitments to
extend credit thereunder shall have been terminated) or (B) been
effectively amended pursuant to the Existing 2006 Credit Agreement Amendment
and Commitment Transfer Agreement and all “Commitment Transfers” referred to
therein shall have been consummated and (ii) the Existing 2007 Credit
Agreement shall have either (A) if all lenders thereunder have executed a
satisfactory Consent and Addendum to the Existing 2007 Credit Agreement
Amendment and Commitment Transfer Agreement, been terminated (and all loans
thereunder and other amounts payable in respect thereof shall have been paid in
full and all commitments to extend credit thereunder shall have been
terminated) or (B) been effectively amended pursuant to the Existing 2007
Credit Agreement Amendment and Commitment Transfer Agreement and all “Commitment
Transfers” referred to therein shall have been consummated;


 


(s)           in the event that either Existing Credit Agreement shall
remain outstanding on the Closing Date, after giving effect to the “Commitment
Transfers” referred to above and the transactions contemplated hereby
(including borrowings requested hereunder and under the First Priority Credit
Agreement and the 2012
Second Priority Credit Agreement as of the Closing Date), the Borrower shall
have drawn, and there shall remain outstanding, loans under such Existing
Credit Agreement (without giving effect to any reductions in the aggregate
principal amount thereof due to fluctuations in currency after March 10,
2009) equal to the total commitments thereunder in effect on the Closing Date
(as such amount may be reduced solely by any unfunded commitments of defaulting
lenders thereunder  and any amounts representing
letter of credit usage of the lenders remaining thereunder as of March 10,
2009);


 


(t)            the Existing 2008 Credit Agreement shall have been
effectively amended pursuant to the Existing 2008 Credit Agreement Amendments;


 


(u)           the Borrower shall have entered into the First Priority
Credit Agreement and the 2012 Second Priority Credit Agreement; and


 


(v)           the representations and warranties of the Loan Parties
contained in the Loan Documents shall be true and correct in all material
respects on and as of the Closing Date both before and after giving effect to
the transactions contemplated hereby; provided that, to the extent such
representations and warranties expressly refer to an earlier date, they shall
be true and correct in all material respects as of such earlier date; provided
further, that any 


 


56

















 


representation and warranty that is qualified as to “materiality”, “Material
Adverse Effect” or similar language shall be true and correct (after giving effect
to such qualification therein) in all respects on such respective dates.


 


Section 3.2. Borrowings.  The obligation of any Bank to
make a Loan or to participate in any Letter of Credit issued by the Fronting
Bank and the obligation of the Fronting Bank to issue a Letter of Credit and
the obligation of the Swingline Lender to make a Swingline Loan on the occasion
of any Borrowing is subject to the satisfaction of the following conditions:


 


(a)           receipt by the Administrative Agent of a Notice of
Borrowing as required by Section 2.3 or Section 2.4(b)(i) or a
request to cause a Fronting Bank to issue a Letter of Credit pursuant to Section 2.19;


 


(b)           in the case of a Revolving Credit Borrowing, Swingline
Borrowing or Letter of Credit issuance, immediately after giving effect to such
Revolving Credit Borrowing, Swingline Borrowing or Letter of Credit issuance,
the aggregate outstanding principal amount of the sum of the Revolving Credit
Loans, Swingline Loans and the Letter of Credit Usage will not exceed the aggregate
amount of the Revolving Credit Commitments;


 


(c)           no Default or Event of Default shall have occurred and be
continuing both before and after giving effect to the making of such Loans or
the issuance of such Letter of Credit;


 


(d)           the Fixed Charge Coverage Ratio shall be at least 1.25 to
1.00;


 


(e)           on a pro forma basis, after giving effect to the making of
such Loans or the issuance of such Letter of Credit and any substantially
contemporaneous addition of any new Collateral with respect to which the Collateral
Trustee shall have been granted a second priority security interest for the
benefit of the Agents and the Banks (subject only to the first priority
Lien granted pursuant to the Security Agreement for the benefit of the First Priority Secured Parties), the Borrower
shall be in compliance with the applicable Coverage Test; and


 


(f)            the representations and warranties of the Loan Parties
contained in the Loan Documents shall be true and correct in all material
respects on and as of the date of such Borrowing or issuance both before and
after giving effect to the making of such Loans or issuance; provided that, to
the extent such representations and warranties expressly refer to an earlier
date, they shall be true and correct in all material respects as of such
earlier date; provided further, that any representation and warranty that is
qualified as to “materiality”, “Material Adverse Effect” or similar language
shall be true and correct (after giving effect to such qualification therein)
in all respects on such respective dates;


 


provided
that if the Borrower makes a prepayment with respect to any Multicurrency
Revolving Credit Loans denominated in an Alternate Currency, the Borrower shall
be permitted to borrow a Revolving Credit Loan in Dollars substantially
concurrently with such payment in an amount less than or equal to the Dollar
Equivalent Amount of such Multicurrency Revolving Credit Loan denominated in an
Alternate Currency without being required to (x) satisfy the foregoing
conditions (other than clause (a) above) or (y) comply with the
minimum borrowing amounts otherwise required hereunder.


 


57

















 


Each Borrowing hereunder or the
issuance of a Letter of Credit hereunder shall be deemed to be a representation
and warranty by the Borrower on the date of such Borrowing as to the facts
specified in clauses (c), (d), (e) and (f) of this Section 3.2.
In the event that any representation or warranty (as set forth in clause (f))
would be materially inaccurate, the Borrower shall disclose the same in writing
to the Banks; provided, however, that the Borrower may only
change such representation or warranty with the prior written consent of the
Required Banks.  Notwithstanding anything
to the contrary, no Borrowing or issuance of Letter of Credit shall be
permitted if such Borrowing or issuance of a Letter of Credit would cause the
Borrower to fail to be in compliance with any of the covenants contained in
this Agreement or in any other Loan Document.


 


ARTICLE IV


 


REPRESENTATIONS
AND WARRANTIES


 


In order to induce the Administrative Agent
and each of the other Banks which is or may become a party to this Agreement to
make the Loans and/or issue or participate in Letters of Credit, the Borrower
makes the following representations and warranties as of the Closing Date and,
in accordance with Section 3.2(f) hereof, as of each Borrowing or
issuance of a Letter of Credit.  Such
representations and warranties shall survive the effectiveness of this
Agreement, the execution and delivery of the other Loan Documents and the
making of the Loans.


 


Section 4.1. Existence and Power.  Each
of the Loan Parties is a corporation, limited liability company or limited
partnership, as applicable, duly organized or incorporated, validly existing
and in good standing under the laws of the jurisdiction of its organization or
incorporation and has all powers and all material governmental licenses,
authorizations, consents and approvals required to own its property and assets
and carry on its business as now conducted or as it presently proposes to
conduct and has been duly qualified and is in good standing in every
jurisdiction in which the failure to be so qualified and/or in good standing is
likely to have a Material Adverse Effect.


 


Section 4.2. Power and Authority.  Each
of the Loan Parties has the requisite power and authority to execute, deliver
and carry out the terms and provisions of each of the Loan Documents to which
it is a party and has taken all necessary action, if any, to authorize the
execution and delivery on its behalf and its performance of the Loan Documents
to which it is a party.  Each of the Loan
Parties has duly executed and delivered each Loan Document (or with
respect to any Mortgage, will duly execute and deliver at the time such
Mortgage is required to be executed and delivered in accordance with Section 2.24)
to which it is a party in accordance
with the terms of this Agreement, and each such Loan Document constitutes (or,
upon execution and delivery thereof, will constitute) its legal, valid and
binding obligation, enforceable in accordance with the terms thereof, except as
enforceability may be limited by applicable insolvency, bankruptcy or other
similar laws affecting creditors rights generally, or general principles of
equity, whether such enforceability is considered in a proceeding in equity or
at law.


 


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Section 4.3. No
Violation.  Neither the execution,
delivery or performance by or on behalf of any Loan Party of the Loan Documents
to which it is a party, nor compliance by any such Loan Party with the terms
and provisions thereof nor the consummation of the transactions contemplated by
such Loan Documents, (i) will materially contravene any applicable provision of
any law, statute, rule, regulation, order, writ, injunction or decree of any
court or governmental instrumentality, (ii) will materially conflict with or
result in any breach of any of the terms, covenants, conditions or provisions
of, or constitute a default under, or result in the creation or imposition of
(or the obligation to create or impose) any Lien (other than Liens created
under the Collateral Documents) upon any of the property or assets of the
Borrower or any of its Consolidated Subsidiaries pursuant to the terms of, any
indenture, mortgage, deed of trust, or other agreement or other instrument to
which the Borrower (or any partnership of which the Borrower is a partner) or
any of its Consolidated Subsidiaries is a party or by which it or any of its
property or assets is bound or to which it is subject (except for such breaches
and defaults under loan agreements which the lenders thereunder have agreed to
forbear pursuant to valid forbearance agreements), or (iii) will cause a
material default by any Loan Party under any organizational document of any
Person in which such Loan Party has an interest, or cause a material default
under such Person’s agreement or certificate of limited partnership, the
consequences of which conflict, contravention, breach or default under the
foregoing clauses (i), (ii) or (iii) would (x) have a Material Adverse Effect (provided, however, that for purposes of determining whether
the consequences of a conflict, contravention, breach or default under clause
(ii) of this Section 4.3 would have a Material Adverse Effect, clause (ii) of
the definition of the term “Material Adverse Effect” shall be modified to read
as follows: “(ii) the ability of the Administrative Agent or the Banks to
enforce the Loan Documents in a manner that materially and adversely affects
the rights of the Administrative Agent or the Banks thereunder”), or (y) result
in or require the creation or imposition of any Lien whatsoever upon any
Property (except as contemplated herein).


 


Section 4.4. Financial
Information.  (a) The consolidated
financial statements of the Borrower and its Consolidated Subsidiaries as of
December 31, 2008, and for the Fiscal Year then ended, reported on by
PricewaterhouseCoopers LLP fairly presents, in conformity with GAAP, the
consolidated financial position of the Borrower and its Consolidated
Subsidiaries as of such date and the consolidated results of operations and
cash flows for such Fiscal Year.


 


(b)           Since December 31, 2008, (i) except
as may have been disclosed in writing to the Banks prior to the Closing Date,
nothing has occurred having a Material Adverse Effect, and (ii) except (x) as
set forth on Schedule 4.4(b) and (y) for the incurrence of Loans
hereunder and loans under the Existing Credit Agreements and the 2012 Second
Priority Credit Agreement and the First Priority Credit Agreement, in each case
on the Closing Date, the Loan Parties have not incurred any material
Indebtedness or guaranteed any Indebtedness on or before the Closing Date.


 


Section 4.5. Litigation.  There is no action, suit or proceeding
pending against, or to the knowledge of the Borrower threatened against or
affecting, (i) the Borrower or any of its Consolidated Subsidiaries, (ii) the
Loan Documents or any of the transactions contemplated by the Loan Documents or
(iii) any of the assets of the Borrower or any of its Consolidated
Subsidiaries, before any court or arbitrator or any governmental body, agency
or official in which there is a reasonable possibility of an adverse decision
which could, individually, or in the 


 


59

















 


aggregate have a Material
Adverse Effect or which in any manner draws into question the validity of this
Agreement or the other Loan Documents.


 


Section 4.6. Compliance
with ERISA.  (a) Except as set forth
on Schedule 4.6(a) attached hereto, neither the Borrower nor any other
Loan Party is a member of or has entered into, maintained, contributed to, or
been required to contribute to, or may incur any liability with respect to any
Plan or Multiemployer Plan.  In the event
that at any time after the Closing Date, the Borrower or any other Loan Party
shall become a member of any other material Plan or Multiemployer Plan, the
Borrower promptly shall notify the Administrative Agent thereof (and from and
after such notice, Schedule 4.6(a) shall be deemed modified thereby).


 


(b)           No assets of the Borrower or any
other Loan Party constitute “assets” (within the meaning of ERISA or Section
4975 of the Code, including, but not limited to, 29 C.F.R. § 2510.3-101 or any
successor regulation thereto) of an “employee benefit plan” within the meaning
of Section 3(3) of ERISA or a “plan” within the meaning of Section 4975(e)(1)
of the Code.  In addition to the
prohibitions set forth in this Agreement and the other Loan Documents, and not
in limitation thereof, the Borrower covenants and agrees that the Borrower
shall not, and shall not permit any other Loan Party to, use any “assets”
(within the meaning of ERISA or Section 4975 of the Code, including but not
limited to 29 C.F.R. § 2510.3101) of an “employee benefit plan” within the
meaning of Section 3(3) of ERISA or a “plan” within the meaning of Section
4975(e)(1) of the Code to repay or secure the Note, the Loan, or the
Obligations.


 


Section 4.7. Environmental.  (a) 
The Borrower conducts reviews of the effect of Environmental Laws on the
business, operations and properties of the Borrower and its Consolidated
Subsidiaries when necessary in the course of which it identifies and evaluates
associated liabilities and costs (including, without limitation, any capital or
operating expenditures required for clean-up or closure of properties presently
owned, any capital or operating expenditures required to achieve or maintain
compliance with environmental protection standards imposed by law or as a
condition of any license, permit or contract, any related constraints on
operating activities, and any actual or potential liabilities to third parties,
including, without limitation, employees, and any related costs and
expenses).  On the basis of this review,
the Borrower has reasonably concluded that such associated liabilities and
costs, including, without limitation, the costs of compliance with
Environmental Laws, are unlikely to have a Material Adverse Effect.


 


(b)           Except as, in the aggregate, could
not reasonably be expected to have a Material Adverse Effect: (i) neither the
Borrower nor any Guarantors has received any notice of violation, alleged
violation, non-compliance, liability or potential liability regarding
environmental matters or compliance with Environmental Laws with regard to any
of the facilities and properties owned, leased or operated by the Borrower or
any Guarantors (the “Properties”) or the business operated by the
Borrower or any Guarantor (the “Business”) that is not fully and finally
resolved, (ii) to the Borrower’s actual knowledge, after due inquiry, no
judicial proceeding or governmental or administrative action is pending or, to
the Borrower’s actual knowledge, after due inquiry, threatened, under any
Environmental Law to which the Borrower or any Guarantor is or will be named as
a party with respect to the Properties or the Business, nor are there any
consent decrees or other decrees, consent orders, administrative 


 


60

















 


orders or other orders, or
other administrative or judicial requirements outstanding under any
Environmental Law with respect to the Business; and (iii) to the Borrower’s
actual knowledge, the Properties and all operations at the Properties are in
compliance, and have in the last five years been in compliance, with all
applicable Environmental Laws, and there is no contamination at, under or about
the Properties or violation of any Environmental Law with respect to the
Properties or the Business.


 


Section 4.8. Taxes.  The Borrower and its Consolidated
Subsidiaries have filed all United States Federal income tax returns and all
other material tax returns which are required to be filed by them and have paid
all taxes due pursuant to such returns or pursuant to any assessment received
by the Borrower, or any Consolidated Subsidiary, except (i) such taxes, if any,
as are reserved against in accordance with GAAP, (ii) such taxes as are being
contested in good faith by appropriate proceedings or (iii) such tax returns or
such taxes, the failure to file when due or to make payment when due and
payable will not have, in the aggregate, a Material Adverse Effect. The
charges, accruals and reserves on the books of the Borrower and its
Consolidated Subsidiaries in respect of taxes or other governmental charges
are, in the opinion of the Borrower, adequate.


 


Section 4.9. Full
Disclosure.  All information
heretofore furnished by the Borrower or any other Loan Party to the
Administrative Agent or any Bank for purposes of or in connection with this
Agreement or any transaction contemplated hereby or thereby is true and
accurate in all material respects on the date as of which such information is
stated or certified; provided that, with respect to projected financial
information, the Borrower represents and warrants only that such information
represents the Borrower’s expectations regarding future performance, based upon
historical information and reasonable assumptions, it being understood,
however, that actual results may differ from the projected results described in
the financial projections.  The Borrower
has disclosed to the Administrative Agent, in writing any and all facts which
have or may have (to the extent the Borrower can now reasonably foresee) a
Material Adverse Effect.


 


Section 4.10. Solvency.  On the Closing Date and after giving effect
to the transactions contemplated by the Loan Documents, the 2012 Second
Priority Credit Agreement and the First Priority Credit Agreement occurring on
the Closing Date, the Borrower and each other Loan Party, taken as a whole,
will be Solvent.


 


Section 4.11. Use
of Proceeds.  All proceeds of the
Loans will be used by the Borrower only in accordance with the provisions
hereof.  Neither the making of any Loan
nor the use of the proceeds thereof will violate or be inconsistent with the
provisions of regulations T, U, or X of the Federal Reserve Board.


 


Section 4.12. Governmental
Approvals.  No order, consent,
approval, license, authorization, or validation of, or filing, recording or
registration with, or exemption by, any governmental or public body or
authority, or any subdivision thereof, is required to authorize, or is required
in connection with the execution, delivery and performance by any Loan Party of
any Loan Document to which it is a party or the consummation of any of the
transactions contemplated thereby other than those that have already been duly
made or obtained and remain 


 


61

















 


in full force and effect or
those which, if not made or obtained, would not have a Material Adverse Effect;


 


Section 4.13. Investment
Company Act.  Neither the Borrower,
any other Loan Party nor any Consolidated Subsidiary is (x) an “investment
company” or a company “controlled” by an “investment company”, within the
meaning of the Investment Company Act of 1940, as amended, or (y) subject to
any other federal or state law or regulation which purports to restrict or
regulate its ability to borrow money.


 


Section 4.14. Principal
Offices.  As of the Closing Date, the
principal office, chief executive office and principal place of business of
each Loan Party is 1114 Avenue of the Americas, New York, NY 10036.


 


Section 4.15. REIT
Status.  As of the date hereof, the
Borrower is qualified as a REIT.


 


Section 4.16. Patents,
Trademarks, etc. The Borrower and each other Loan Party has obtained and
holds in full force and effect all patents, trademarks, servicemarks, trade
names, copyrights and other such rights, free from burdensome restrictions,
which are necessary for the operation of its business as presently conducted,
the impairment of which is likely to have a Material Adverse Effect.


 


Section 4.17. Judgments.  As of the Closing Date, there are no final,
non-appealable judgments or decrees in an aggregate amount of $10,000,000 or
more entered by a court or courts of competent jurisdiction against the
Borrower, any other Loan Party or any Consolidated Subsidiary or, to the extent
such judgment would be recourse to the Borrower, any other Loan Party or any
Consolidated Subsidiary, any other Person (other than, in each case, judgments
as to which, and only to the extent, a reputable insurance company has
acknowledged coverage of such claim in writing or which have been paid or
stayed).


 


Section 4.18. No
Default.  No Event of Default or, to
the best of the Borrower’s knowledge, Default exists under or with respect to
any Loan Document and neither the Borrower nor any other Loan Party is in
default in any material respect beyond any applicable grace period under or
with respect to any other material agreement, instrument or undertaking to
which it is a party or by which it or any of its property is bound in any
respect, the existence of which default is likely to result in a Material
Adverse Effect.


 


Section 4.19. Licenses,
etc. Each of the Loan Parties has obtained and does hold in full force and
effect, all franchises, licenses, permits, certificates, authorizations,
qualifications, accreditation, easements, rights of way and other consents and
approvals which are necessary for the operation of its businesses as presently
conducted, the absence of which is likely to have a Material Adverse Effect.


 


Section 4.20. Compliance
with Law.  To the Borrower’s
knowledge, each Loan Party and each of its assets are in compliance in all
material respects with all laws, rules, regulations, orders, judgments, writs
and decrees, the failure to comply with which is likely to have a Material
Adverse Effect.


 


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Section 4.21. No
Burdensome Restrictions.  Except as
may have been disclosed by the Borrower in writing to the Banks prior to the
Closing Date or that would otherwise be permitted under the Loan Documents,
neither the Borrower nor any other Loan Party is a party to any agreement or
instrument or subject to any other obligation or any charter or corporate or
partnership restriction, as the case may be, which, individually or in the
aggregate, is likely to have a Material Adverse Effect.


 


Section 4.22. Brokers’
Fees.  Neither the Borrower nor any
other Loan Party has dealt with any broker or finder with respect to the
transactions contemplated by this Agreement or otherwise in connection with
this Agreement, and neither the Borrower nor any other Loan Party has done any
act, had any negotiations or conversation, or made any agreements or promises
which will in any way create or give rise to any obligation or liability for
the payment by the Borrower or any other Loan Party of any brokerage fee,
charge, commission or other compensation to any party with respect to the
transactions contemplated by the Loan Documents, other than the fees payable to
the Administrative Agent and the Banks, and certain other Persons as previously
disclosed in writing to the Administrative Agent.


 


Section 4.23. Labor
Matters.  Except as disclosed on Schedule
4.6(a), there are no collective bargaining agreements or Multiemployer
Plans covering the employees of the Borrower, any other Loan Party or any
member of the ERISA Group, and neither the Borrower nor any other Loan Party
has suffered any material strikes, walkouts, work stoppages or other material
labor difficulty within the last five years.


 


Section 4.24. Insurance.  The Loan Parties currently maintain 100%
replacement cost insurance coverage (subject to customary deductibles) in
respect of each of their Real Property Assets, as well as commercial general
liability insurance (including, without limitation, “builders’ risk” where
applicable) against claims for personal, and bodily injury and/or death, to one
or more persons, or property damage, as well as workers’ compensation
insurance, in each case with respect to liability and casualty insurance with
insurers having an A.M. Best policyholders’ rating of not less than A-/VII at
the time of issuance or extension of any such coverage policy in amounts no
less than customarily carried by owners of properties similar to, and in the
same locations as, the Loan Parties’ Real Property Assets; provided, however,
that the foregoing A.M. Best policyholders’ rating requirement shall not be
required for (a) such insurance as tenants of Credit Tenant Lease Assets and
Other Real Estate Owned Assets are permitted or required pursuant to applicable
leases to obtain or maintain, (b) exposure under existing insurance policies
(but not renewals of any such policies) to CV Starr, in a Lloyds Syndicate in
an amount not to exceed $20,000,000 and (c) liability and casualty insurance
policies issued after the Closing Date on Real Property Assets constituting not
more than 5.0% of all Real Property Assets owned by the Loan Parties with
insurers having an A.M. Best policyholders’ rating of less than A-/VII, but not
less than B++/VII.


 


Section 4.25. Organizational
Documents.  The documents delivered
pursuant to Section 3.1(h) constitute, as of the Closing Date, all of the
organizational documents (together with all amendments and modifications thereof)
of each Loan Party.  The Borrower
represents that it has delivered to the Administrative Agent true, correct and
complete copies of each such document.


 


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Section 4.26. Unencumbered
Assets and Indebtedness.  As of the
date hereof, Schedule 4.26 accurately sets forth (i) total Unencumbered
Assets, (ii) all Unsecured Debt and (iii) all Secured Debt, in each case as of
December 31, 2008, on a pro forma basis after giving effect to the incurrence
of Loans hereunder and the loans under the 2012 Second Priority Credit
Agreement and the First Priority Credit Agreement, in each case on the date
hereof.  All of the information set forth
on Schedule 4.26 is true and correct in all material respects as of the
date hereof.


 


Section 4.27. Ownership
of Property; Liens.  The Borrower,
each other Loan Party and each Collateral LLC owns the Eligible Assets
purported to be owned by it, as applicable, and none of the Eligible Assets is
subject to any Lien except as permitted by Section 5.15.


 


Section 4.28. Subsidiaries.  Except as disclosed to the Administrative
Agent by the Borrower in writing from time to time after the Closing Date, (a) Schedule
4.28 sets forth the name and jurisdiction of incorporation of each Collateral
SPV and Collateral LLC and, as to each such Collateral SPV and Collateral LLC,
the percentage of each class of equity interests owned by any Loan Party and
(b) there are no outstanding subscriptions, options, warrants, calls, rights or
other agreements or commitments (other than stock options granted to employees
or directors and directors’ qualifying shares) of any nature relating to any
equity interests of the Borrower or any Collateral SPV or Collateral LLC,
except as created by the Loan Documents.


 


Section 4.29. Security
Documents.  The Security Agreement is
effective to create in favor of the Collateral Trustee, for the benefit of the
Agents and the Banks, a legal, valid and enforceable security interest in the
Collateral described therein and proceeds thereof.  In the case of the Pledged Stock described in
the Security Agreement, when stock certificates representing such Pledged
Stock, if any, are delivered to the Collateral Trustee, and in the case of the
other Collateral described in the Security Agreement, when financing statements
and other filings specified on Schedule 4.29 in appropriate form are
filed in the offices specified on Schedule 4.29, the Security Agreement
shall constitute a fully perfected second priority Lien on, and security interest
in, all right, title and interest of the Loan Parties in such Collateral and
the proceeds thereof, as security for the Second Priority Secured Obligations
(as defined in the Collateral Trust Agreement), in each case prior and superior
in right to any other Lien (other than any Liens permitted by Section
5.15(a)(ii) and Permitted Liens described in clauses (a), (b) and (f) of the
definition thereof set forth herein).


 


Section 4.30. Mortgages.  Each Mortgage, when executed and delivered as
required by and in accordance with Section 2.24, will be recorded in the real
property records of the applicable county and state in which the Mortgaged
Property encumbered thereunder is located. 
No Loan Party has created any Lien securing Indebtedness for money
borrowed against a Mortgaged Property that is a Mortgage-Eligible Asset that
would be prior to or superior in right to any Mortgage on such Mortgaged
Property.


 


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ARTICLE V


 


AFFIRMATIVE AND NEGATIVE COVENANTS


 


The Borrower
covenants and agrees that, so long as any Bank has any Commitment hereunder or
any Obligation remains unpaid:


 


Section 5.1. Information.  The Borrower shall deliver to each of the
Banks or post to Intralinks provided such information is not otherwise publicly
available:


 


(a)           as soon as available and in any event
within five (5) Business Days after the same is required to be filed with the
Securities and Exchange Commission (but in no event later than 95 days after
the end of each Fiscal Year of the Borrower) a consolidated balance sheet of
the Borrower and its Consolidated Subsidiaries as of the end of such Fiscal
Year and the related consolidated statements of the Borrower’s operations and
consolidated statements of the Borrower’s cash flow for such Fiscal Year,
setting forth in each case in comparative form the figures for the previous
Fiscal Year (if available), all reported in a manner acceptable to the
Securities and Exchange Commission on the Borrower’s Form 10-K and reported on
by PricewaterhouseCoopers LLP or other independent public accountants of
nationally recognized standing;


 


(b)           (i) as soon as available and in any
event within five (5) Business Days after the same is required to be filed with
the Securities and Exchange Commission (but in no event later than 50 days
after the end of each of the first three Fiscal Quarters of each Fiscal Year of
the Borrower), a consolidated balance sheet of the Borrower and its
Consolidated Subsidiaries as of the end of such Fiscal Quarter and the related
consolidated statements of the Borrower’s operations and consolidated
statements of the Borrower’s cash flow for such quarter and for the portion of
the Borrower’s Fiscal Year ended at the end of such Fiscal Quarter, all
reported in the form provided to the Securities and Exchange Commission on the
Borrower’s Form 10-Q, together with (ii) such other information reasonably
requested by the Administrative Agent or any Bank;


 


(c)           simultaneously with the delivery of
each set of financial statements referred to in clauses (a) and (b) above, (I)
a certificate of a financial officer of the Borrower (i) setting forth in
reasonable detail the calculations required to establish whether the Borrower
was in compliance with the requirements of Section 5.10 on the date of such
financial statements and (ii) certifying (x) that such financial statements
fairly present the financial condition and the results of operations of the
Borrower on the dates and for the periods indicated, on the basis of GAAP, with
respect to the Borrower subject, in the case of interim financial statements,
to normally recurring year-end adjustments, and (y) that such officer has
reviewed the terms of the Loan Documents and has made, or caused to be made
under his or her supervision, a review in reasonable detail of the business and
condition of the Borrower during the period beginning on the date through which
the last such review was made pursuant to this Section 5.1(c) (or, in the case
of the first certification pursuant to this Section 5.1(c), the Closing Date)
and ending on a date not more than ten (10) Business Days prior to, but
excluding, the date of such delivery and that (1) on the basis of such
financial statements and such review of the Loan Documents, no 


 


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Event of Default existed under
Section 6.1(b) with respect to Section 5.10 or Section 5.17 at or as of the
date of said financial statements, or with respect to Section 5.10(a), at any
time, and (2) on the basis of such review of the Loan Documents and the
business and condition of the Borrower, to the best knowledge of such officer,
as of the last day of the period covered by such certificate no Default or
Event of Default under any other provision of Section 6.1 occurred and is continuing
or, if any such Default or Event of Default has occurred and is continuing,
specifying the nature and extent thereof and, the action the Borrower proposes
to take in respect thereof (and such certificate shall set forth the
calculations required to establish the matters described in clauses (1) and (2)
above) and (II) updated Cash Flow Projections;


 


(d)           (i) 
within five (5) Business Days after any officer of the Borrower obtains
knowledge of any Default or Event of Default, if such Default or Event of Default
is then continuing, a certificate of the chief financial officer, or other
executive officer of the Borrower, setting forth the details thereof and the
action which the Borrower is taking or proposes to take with respect thereto;
and (ii) promptly and in any event within five (5) Business Days after the
Borrower obtains knowledge thereof, notice of (x) any litigation or
governmental proceeding pending or threatened against the Borrower or any
Consolidated Subsidiary or its directly or indirectly owned Real Property
Assets as to which there is a reasonable possibility of an adverse
determination and which, if adversely determined, is likely to individually or
in the aggregate, result in a Material Adverse Effect, and (y) any other event,
act or condition which is likely to result in a Material Adverse Effect;


 


(e)           promptly upon the mailing thereof to
the shareholders of the Borrower generally, copies of all proxy statements or
any other materials so mailed;


 


(f)            promptly and in any event within
thirty (30) days, if and when any member of the ERISA Group (i) gives or is
required to give notice to the PBGC of any “reportable event” (as defined in
Section 4043 of ERISA) with respect to any Plan which might constitute grounds
for a termination of such Plan under Title IV of ERISA, or knows that the plan
administrator of any Plan has given or is required to give notice of any such
reportable event, a copy of the notice of such reportable event given or
required to be given to the PBGC; (ii) receives notice of complete or partial
withdrawal liability under Title IV of ERISA or notice that any Multiemployer
Plan is in reorganization, is insolvent or has been terminated, a copy of such
notice; (iii) receives notice from the PBGC under Title IV of ERISA of an intent
to terminate, impose liability (other than for premiums under Section 4007 of
ERISA) in respect of, or appoint a trustee to administer any Plan, a copy of
such notice; (iv) applies for a waiver of the minimum funding standard under
Section 412 of the Code, a copy of such application; (v) gives notice of intent
to terminate any Plan under Section 4041(c) of ERISA, a copy of such notice and
other information filed with the PBGC; (vi) gives notice of withdrawal from any
Plan pursuant to Section 4063 of ERISA, a copy of such notice; or (vii) fails
to make any payment or contribution to any Plan or Multiemployer Plan or makes
any amendment to any Plan which has resulted or could result in the imposition
of a Lien or the posting of a bond or other security, and, in the case of any
occurrence covered by any of clauses (i) through (vii) above, which occurrence
would reasonably be expected to result in a Material Adverse Effect, a
certificate of the chief financial officer or the chief accounting officer of
the Borrower setting forth details as to such occurrence and action, if any,
which the Borrower or applicable member of the ERISA Group is required or
proposes to take;


 


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(g)           promptly and in any event within ten (10) days
after the Borrower obtains actual knowledge of any of the following events, a
certificate of the Borrower, executed by an officer of the Borrower, specifying
the nature of such condition, and the Borrower’s or, if the Borrower has actual
knowledge thereof, the Environmental Affiliate’s proposed initial response
thereto: (i) the receipt by the Borrower, or any of the Environmental
Affiliates of any communication (written or oral), whether from a governmental
authority, citizens group, employee or otherwise, that alleges that the
Borrower, or any of the Environmental Affiliates, is not in compliance with
applicable Environmental Laws, and such noncompliance is likely to have a
Material Adverse Effect, (ii) the existence of any Environmental Claim
pending against the Borrower or any Environmental Affiliate and such
Environmental Claim is likely to have a Material Adverse Effect or (iii) any
release, emission, discharge or disposal of any Material of Environmental
Concern that is likely to form the basis of any Environmental Claim against the
Borrower or any Environmental Affiliate which in any such event is likely to
have a Material Adverse Effect;


 


(h)           promptly and in any event within five
(5) Business Days after receipt of any notices or correspondence from any
company or agent for any company providing insurance coverage to the Borrower
or any other Loan Party relating to any loss which is likely to result in a
Material Adverse Effect, copies of such notices and correspondence;


 


(i)            within ten (10) Business Days after the end of each fiscal
month, a statement of all Secured Debt as well as the total amount of Unsecured
Debt (in each case, on a Subsidiary by Subsidiary basis), based upon the best
available information at such time as certified by a financial officer of the
Borrower;


 


(j)            promptly and in any event within ten
(10) days after an event or events of default with respect to Non-Recourse
Indebtedness in an aggregate amount equal to or greater than $100,000,000 of
the Borrower, its Consolidated Subsidiaries and/or the Borrower’s Share of
Non-Recourse Indebtedness of Investment Affiliates, the Borrower shall deliver
to the Administrative Agent a recalculation of the Consolidated Tangible Net
Worth, reflecting the effects of such event or events of default, as well as
any other changes in the Borrower’s Consolidated Tangible Net Worth;


 


(k)           as soon as available and in any event
within twenty (20) days
after the end of each fiscal month, a Borrowing Base Certificate duly executed
by an officer of the Borrower setting forth a calculation of the aggregate
Borrowing Base Value of the Collateral and any other Listed Eligible Assets as
of the end of the most recent fiscal month, based upon the best
available information at such time as certified by a financial officer of the
Borrower; provided that for purposes of such calculation, the proviso to
the definition of “Coverage Ratio” shall be applicable;


 


(l)            as soon as available and in any
event within twenty (20) days
after the end of each Fiscal Quarter, a Collateral Report, based upon
the best available information at such time as certified by a financial officer
of the Borrower; and


 


(m)          from time to time such additional
information regarding any of the Collateral or Eligible Assets or the financial
condition or operations or investments of the 


 


67

















 


Borrower
and its Subsidiaries, in each case, as the Administrative Agent, at the request
of any Bank, may reasonably request in writing, so long as disclosure of such
information could not result in a violation of, or expose the Borrower or its
Subsidiaries to any material liability under, any applicable law, statute,
ordinance or regulation or any agreements with unaffiliated third parties that
are binding on the Borrower or any of its Subsidiaries or on any Property of
any of them.


 


Section 5.2. Payment of Obligations.  The
Borrower and its Consolidated Subsidiaries will pay and discharge, at or before
maturity, all their respective material obligations and liabilities including,
without limitation, any such material obligations (a) pursuant to any
agreement by which it or any of its properties is bound and (b) in respect
of federal, state and other taxes, in each case where the failure to so pay or
discharge such obligations or liabilities is likely to result in a Material
Adverse Effect, and will maintain in accordance with GAAP, appropriate reserves
for the accrual of any of the same.


 


Section 5.3. Maintenance of Property; Insurance; Leases.


 


(a)           The Borrower shall keep, and shall
cause each Consolidated Subsidiary to keep, all property useful and necessary
in its business, including without limitation each of its Real Property Assets
(for so long the same constitutes a Real Property Asset), in good repair,
working order and condition, ordinary wear and tear excepted, in each case
where the failure to so maintain and repair will have a Material Adverse
Effect.


 


(b)           The Borrower shall maintain, or cause
to be maintained, insurance described in Section 4.24 hereof with insurers
meeting the qualifications described therein, which insurance shall in any
event not provide for less coverage than insurance customarily carried by
owners of properties similar to, and in the same locations as, the Loan Parties’
Real Property Assets.  The Borrower shall
deliver to the Administrative Agent (i) upon the reasonable request of the
Administrative Agent from time to time certificates of insurers evidencing the
insurance carried, (ii) within five (5) days of receipt of notice
from any insurer a copy of any notice of cancellation or material change in
coverage required by Section 4.24 from that existing on the date of this
Agreement and (iii) forthwith, notice of any cancellation or nonrenewal
(without replacement) of coverage by the Borrower or any Loan Party.


 


Section 5.4. Maintenance of Existence.  The
Borrower shall and shall cause each of its Consolidated Subsidiaries to
preserve, renew and keep in full force and effect, its corporate existence and
its rights, privileges and franchises necessary for the normal conduct of its
business unless the failure to maintain such rights and franchises does not
have a Material Adverse Effect.


 


Section 5.5. Compliance with Laws.  The
Borrower shall, and shall cause its Consolidated Subsidiaries to, comply in all
material respects with all applicable laws, ordinances, rules, regulations, and
requirements of governmental authorities (including, without limitation,
Environmental Laws, and all zoning and building codes with respect to its Real
Property Assets and ERISA and the rules and regulations thereunder and all
federal securities laws) except where the necessity of compliance therewith is
contested in good faith by 


 


68

















 


appropriate proceedings or where the failure
to do so will not have a Material Adverse Effect or expose the Administrative
Agent or Banks to any material liability therefor.


 


Section 5.6. Inspection of Property, Books and Records.  The
Borrower shall, and shall cause each of its Consolidated Subsidiaries to, keep
proper books of record and account in which full, true and correct entries
shall be made of all dealings and transactions in relation to its business and
activities in conformity with GAAP, modified as required by this Agreement and
applicable law; and shall permit representatives of any Bank, at such Bank’s
expense, or upon the occurrence and during the continuation of any Event of
Default, at the Borrower’s expense (but subject to the reimbursement
limitations in Section 9.3), so long as disclosure of such information
could not result in a violation of, or expose the Borrower or any of its
Subsidiaries to any material liability under, any applicable law, ordinance or
regulation or any agreements with unaffiliated third parties that are binding
on the Borrower or any of its Subsidiaries, to examine and make abstracts from
any of its books and records and to discuss its affairs, finances and accounts
with its officers and independent public accountants, all at such reasonable
times during normal business hours, upon reasonable prior notice and as often
as may reasonably be desired.  Upon the
occurrence and during the continuance of any Event of Default, representatives
of any Bank permitted to review such books or engage in such discussions shall
include consultants, accountants, auditors and any other representatives that
any Bank deems necessary in connection with any workout or proposed workout of
the Loans.


 


Section 5.7. Existence.  The Borrower shall do or cause
to be done, all things necessary to preserve and keep in full force and effect
its and its Consolidated Subsidiaries’ existence and its patents, trademarks,
servicemarks, tradenames, copyrights, franchises, licenses, permits,
certificates, authorizations, qualifications, accreditation, easements, rights
of way and other rights, consents and approvals the nonexistence of which is
likely to have a Material Adverse Effect.


 


Section 5.8. Deposit Accounts.  (a) 
The Borrower shall cause, within 90 days after the Closing Date, all
payments in respect of any Loan Assets (net of any portion thereof attributable
to any portion of such Loan Assets beneficially owned by third parties)
included in the Collateral to be directed to deposit accounts maintained by the
Collateral SPVs with the Administrative Agent (each such account a “Collateral
SPV Deposit Account”), and all payments on account of assets owned by the
Collateral LLCs (net of any portion thereof attributable to any portion of such
assets beneficially owned by third parties) to be directed to deposit accounts
maintained by the Collateral LLCs with the Administrative Agent (each such
account a “Collateral LLC Deposit Account”).


 


(b)           The Borrower shall
cause each Collateral LLC to transfer all such amounts held in any Collateral
LLC Deposit Account, within 5 Business Days of receipt thereof, to a Collateral
SPV Deposit Account and any such transfer shall be deemed to be a cash dividend
or distribution on account of the Capital Stock (as defined in the Collateral
Trust Agreement) of such Collateral LLC for purposes of determining the
Collateral (including for the avoidance of doubt, the application of proceeds
pursuant to Section 5.3 of the Security Agreement).  Other than the transfer of all such amounts held in any Collateral LLC
Deposit Account pursuant to the preceding sentence, the Loan Parties shall have
no right to withdraw or otherwise direct disposition of funds in any Collateral
LLC Deposit Account.


 


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(c)           Any amounts held in
Collateral SPV Deposit Accounts may be released to or as directed by the
Collateral SPVs on a daily basis except in the following cases: (i) if a
Material Default or Event of Default shall have occurred and be continuing on
any such date, the amounts held in the Collateral SPV Deposit Accounts may only
be used for (x) payments and prepayments of the Loans as provided for
hereunder, and (y) transfers to the Collateral Account maintained under
the Collateral Trust Agreement or (ii) if a Principal Collateral Payment
Event shall have occurred and be continuing on any such date, Principal
Collateral Payments shall be released from the Collateral SPV Deposit Accounts
solely for application toward the prepayment of the Loans in accordance with Section 2.12.  The Borrower hereby agrees that (A) it
will not request, and will not permit any Collateral SPV or Collateral LLC to
request, any withdrawals from the accounts described in this Section 5.8
not permitted hereunder and under the terms of the Security Agreement and (B) JPMorgan
Chase Bank, N.A. shall not be required to release any amounts requested in
violation of the terms hereof or of the Security Agreement and shall not be
liable to the Borrower or any Affiliate thereof for such failure to release any
such funds.


 


Section 5.9. Independent Director.  The
board of directors, board of managers, or other equivalent governing body of
each Collateral SPV and each Collateral LLC shall include at least one special,
independent director or member (or equivalent thereof), appointed by the
Administrative Agent, whose consent shall be required for (i) any
bankruptcy or insolvency filing by the relevant Collateral SPV or Collateral
LLC, as the case may be, (ii) the transfer of any membership or other
equity interests therein (other than the sale of such membership or
equity interests in a transaction permitted under the Loan Documents) or (iii) encumbering
any asset owned by such Collateral SPV or Collateral LLC with a real property
mortgage or deed of trust, as applicable, or a security agreement, pledge
agreement or any similar agreement creating a Lien in respect thereof, except
as permitted under the Loan Documents (including as a result of any consent,
amendment, waiver or other modification obtained in accordance with the terms
of the Loan Documents).


 


Section 5.10. Financial Covenants and Restricted Payments.


 


(a)           Minimum Consolidated Tangible Net
Worth.  The Consolidated Tangible Net
Worth of the Borrower determined in conformity with GAAP shall at no time be
less than $1,500,000,000.


 


(b)           Total Indebtedness to Net Worth.  As of the last day of each Fiscal Quarter,
the ratio of Total Indebtedness to the Borrower’s Net Worth shall not exceed
5.00 to 1.00.


 


(c)           EBITDA to Fixed Charges Ratio.  As of the last day of each Fiscal Quarter,
the Fixed Charge Coverage Ratio shall not be less than 1.00 to 1.00.


 


(d)           Unencumbered Pool.  The ratio of the Value of the Unencumbered
Assets to Unsecured Debt, as of the last day of each Fiscal Quarter, shall not
be less than 1.20 to 1.00.


 


(e)           Dividends; Other Restricted Payments.


 


(i)            The Borrower shall
not, and shall not permit its Subsidiaries to, pay any dividends; provided
that, (x) in any Fiscal Year in which the Borrower is 


 


70

















 


qualified as a
REIT, the Borrower may pay dividends in an amount, as determined on an
aggregate annual basis as of the end of any such Fiscal Year, not to exceed
100% of the Borrower’s REIT taxable income for such Fiscal Year calculated
prior to deducting dividends paid or payable by the Borrower, (y) any
Subsidiary of the Borrower may pay dividends to the Borrower or to any other
Subsidiary of the Borrower and (z) the Borrower may pay dividends to
holders of its preferred equity in an aggregate amount in any Fiscal Year not
to exceed the stated dividend amount payable pursuant to the terms of such
preferred equity.


 


(ii)           The Borrower shall
not, and shall not permit its Subsidiaries to, 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
interests in the Borrower, or of any warrants, options or other rights or
obligations to purchase or acquire any such equity interests, or make any other
distribution in respect to any such equity interests, in each case, whether now
or hereafter outstanding, either directly or indirectly, whether in cash or
property or in obligations of the Borrower or any of its Subsidiaries, except
that the Borrower or any Subsidiary may make Permitted Share Repurchases so
long as (x) no Default or Event of Default has occurred and is continuing
at the time of such Permitted Share Repurchase, or would result therefrom, and (y) no
Principal Collateral Payment Event shall have occurred and be continuing.


 


Section 5.11. Restriction on Fundamental Changes.  (a) The
Borrower shall not, and shall not permit any Collateral SPV or Collateral LLC
to, enter into any merger or consolidation without obtaining the prior written
consent thereto of the Required Banks, unless (i) in the case of any such
merger or consolidation involving (u) the Borrower, the Borrower is the
surviving entity, (v) iStar Tara Holdings LLC, iStar Tara Holdings LLC is
the surviving entity (provided that iStar Tara LLC and any other Collateral SPV
owned by iStar Tara Holdings LLC, shall not be permitted to merge or
consolidate with or into iStar Tara Holdings LLC), (w) a Collateral SPV
(other than iStar Tara Holdings LLC), a Collateral SPV is the surviving entity,
(x) a Collateral LLC, a Collateral LLC is the surviving entity, (y) a
Grantor, a Grantor is the surviving entity and (z) a Guarantor, a
Guarantor is the surviving entity, and (ii) in each case, the same will
not result in the occurrence of a Material Default or an Event of Default. The
Borrower shall not, and shall not permit any Collateral SPV or Collateral LLC
to, liquidate, wind-up or dissolve (or suffer any liquidation or dissolution),
discontinue its business or convey, lease, sell, transfer or otherwise dispose
of, in one transaction or series of transactions, all or substantially all of
its business or property, whether now or hereafter acquired, other than to any
Collateral SPV (or, in the case of any Collateral LLC, to any other Collateral
LLC or in connection with any sale of all or substantially all of its assets or
any payment or prepayment in full or other monetization in full of its assets).


 


(b)           The Borrower shall not, and shall not
permit any other Loan Party or any Pledged Collateral LLC to, amend its
articles of incorporation, bylaws, or other organizational documents in any
manner that would be materially adverse to the Banks without the Required Banks’
consent.


 


Section 5.12. Changes in Business.  The
Borrower’s primary business shall not be substantially different from that
conducted by the Borrower on the Closing Date and shall 


 


71

















 


include ownership and management of Credit
Tenant Lease Assets and Loan Assets.  The
Borrower shall carry on its business operations through the Borrower and its
Consolidated Subsidiaries and its Investment Affiliates.


 


Section 5.13. Borrower Status.  The
Borrower shall at all times remain a publicly traded company listed for trading
on the New York Stock Exchange (or another nationally recognized stock exchange
(for the avoidance of doubt, the NASDAQ stock quotation system or any successor
thereto shall be considered a nationally recognized exchange)).


 


Section 5.14. Other Indebtedness.  (a) 
The Borrower shall not incur or maintain or permit any Secured Debt (excluding
the Secured Bank Facilities or the Secured Exchange Notes) which is Recourse
Debt in excess of an amount equal to 20% of Consolidated Tangible Net
Worth.  Any Indebtedness maintained or
incurred by any Subsidiary of the Borrower that is Recourse Debt of such
Subsidiary shall be deemed to be Secured Debt for purposes of this Section 5.14
and Section 5.10; provided that Indebtedness of any Guarantor that is not
secured shall not be so deemed to be Secured Debt.


 


(b)           The Borrower shall not permit any
Guarantor or Pledged Collateral LLC to incur any Indebtedness other than (i) Indebtedness
evidenced by the Loan Documents, (ii) Indebtedness in respect of the other
Secured Bank Facilities and (iii) Indebtedness in respect of the Secured
Exchange Notes under (x) a guarantee containing a limitation on
liability substantially equivalent to the limitation included in Section 2.1(b) of
the Guarantee Agreement and the equivalent provision under the guarantee of the
2012 Second Priority Credit Agreement (or, in the case of Secured Exchange
Notes sharing a third priority security interest under the Security Agreement,
containing a similar limitation taking into account such third priority
entitlement) and (y) the Collateral Documents.


 


(c)           The Borrower shall not consent to or vote in
favor of (and shall not permit any Subsidiary to consent to or vote in favor
of) the incurrence of any Indebtedness by any Collateral LLC or any Venture
LLC, in each case owned directly or indirectly by any Guarantor.


 


(d)           The Borrower shall not issue Second
Priority Secured Exchange Notes in an aggregate face amount in excess of
$1,000,000,000.


 


Section 5.15. Liens.  (a) The Borrower shall not, nor shall it permit any Subsidiary
to, create, incur, assume or suffer to exist any Lien upon any of its property,
whether now owned or hereafter acquired, except for:


 


(i) Permitted Liens;


 


(ii) Liens on the Collateral
securing Indebtedness pursuant to (i) the First Priority Credit Agreement
and (ii) the 2012 Second Priority Credit Agreement, in each case, subject
to the terms of the Collateral Trust Agreement;


 


(iii) Liens on the Collateral,
subject to the terms of the Collateral Trust Agreement, securing Indebtedness
pursuant to the Second Priority Secured Exchange Notes in an aggregate
principal amount not to exceed $1,000,000,000, so long as the Borrower shall be
in compliance, on a pro forma basis after giving effect to the granting of any
such Lien and any 


 


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contemporaneous pledge of additional Collateral pursuant to the Loan
Documents, with Section 5.17;


 


(iv) Liens on the Collateral,
subject to the terms of the Collateral Trust Agreement, securing Indebtedness
pursuant to the Junior Priority Secured Exchange Notes;


 


(v) Liens on assets of the
Borrower or any of its Subsidiaries (including Liens incurred pursuant to
clause (y)(B) of the proviso to clause (vi) of this Section 5.15)
with a book value not to exceed $750,000,000 at any one time outstanding; and


 


(vi) Liens existing as of the
Closing Date and listed on Schedule 1.1D and any extensions or replacements
thereof; provided that in connection with any such extension or
replacement, (x) the advance rate for any such Indebtedness secured by
Liens pursuant to this clause (vi) is not decreased by more than 15% from
the rate in effect on the Closing Date and (y) the amount of Indebtedness
secured by Liens pursuant to this clause (vi) is not increased, except to
the extent that (A) no additional assets become subject to Liens as a
result of such increase or (B) such increase is secured by Liens on
additional assets incurred pursuant to clause (v) of this Section 5.15;


 


provided that (x) in the case of each of clauses
(i) (other than with respect to any Permitted Liens described in clause
(a), (b) or (f) of the definition thereof set forth herein), (v) and
(vi) of this Section 5.15, such assets to be encumbered shall not
constitute (A) Collateral, (B) Specified Listed Eligible Assets, (C) assets
of a Collateral LLC or (D) Fremont Assets, (y) in no event shall the
Borrower create, incur, assume or suffer to exist, or permit any Subsidiary to
create, incur, assume or suffer to exist, any Lien upon any of its property to
secure any public notes of the Borrower outstanding as of the Closing Date or
any notes into which such public notes may be exchanged (other than any Secured
Exchange Notes) and (z) any Secured Exchange Notes shall only be secured
by the Collateral,


 


(b)           The Borrower shall
not consent to or vote in favor of (and shall not permit any Subsidiary to
consent to or vote in favor of) the incurrence of any Liens on any assets of
any Collateral LLC or Venture LLC, in each case owned directly or indirectly by
any Guarantor.


 


provided that (x) the foregoing restrictions in
this Section 5.15 shall not apply at any time and for so long as (A) the
loans and other obligations under the First Priority Credit Agreement have been
repaid in full and the commitments thereunder have been terminated and (B) the
Coverage Ratio is not less than (1) 1.50 to 1.00, or (2) if no
Secured Exchange Notes have been issued and the Exchange Option Termination has
occurred, 1.35 to 1.00 and (y) no Default or Event of Default shall be
deemed to occur under or as a consequence of this Section 5.15 solely as a
result of the existence of a Lien, not otherwise prohibited hereunder, created,
incurred or assumed by the Borrower or any Subsidiary at a time when the
conditions set forth in clause (x) of this proviso had been satisfied (it
being understood, however, that any subsequent incurrence or assumption of a
Lien at a time when, or after giving effect to which, the Borrower shall not be
in compliance with this clause (x)(B) of this proviso, shall constitute an
Event of Default).  Notwithstanding
anything to the contrary herein, the security interest in the Collateral
granted pursuant to the Security Agreement shall be free and clear of any Liens
(other than Liens created 


 


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under the Security Agreement and Permitted Liens
described in clause (a), (b) or (f) of the definition thereof set
forth herein).


 


Section 5.16. Prepayments of Secured Exchange Notes, Other
Notes, 2012 Second Priority Credit Agreement and Existing Credit Agreements;
Amendments.  (a)  The Borrower shall not and shall
not permit any of its Subsidiaries to, make or offer to make any optional or
voluntary payment, prepayment, repurchase or redemption of or otherwise
optionally or voluntarily satisfy, defease or refinance (including with Cash or
Cash Equivalents or otherwise) or segregate funds with respect to (i) any
Secured Exchange Notes or (ii) any notes of the Borrower issued prior to
the Closing Date, in the case of each of the foregoing clauses (i) and
(ii), that has a maturity date later than the Termination Date, or any
refinancing of any of the foregoing; provided, however, that (A) the
Borrower or any Subsidiary may make Permitted Note Repurchases so long as (x) no
Default or Event of Default has occurred and is continuing at the time of such
Permitted Note Repurchase, or would result therefrom and (y) no Principal
Collateral Payment Event shall have occurred and be continuing and (B) the
Borrower or any Subsidiary may refinance any Indebtedness described in the
foregoing clauses (i) and (ii) with Secured Exchange Notes and new
unsecured notes of the Borrower with maturities, in each case, later than December 31,
2012 (including, for the avoidance of doubt, refinancings consummated with the
net proceeds of such new Indebtedness or by way of exchange).


 


(b)           The Borrower shall not and shall not
permit any of its Subsidiaries to, make or offer to make any optional or
voluntary payment, prepayment or repurchase of or otherwise optionally
refinance (including with Cash or Cash Equivalents or otherwise) or segregate
funds with respect to either Existing Credit Agreement, or any refinancing
thereof.


 


(c)           Except as set forth in the Priority
of Payments, the Borrower shall not and shall not permit any of its
Subsidiaries to, make or offer to make any optional or voluntary payment,
prepayment or repurchase of or otherwise optionally refinance (including with
Cash or Cash Equivalents or otherwise) or segregate funds with respect to the
2012 Second Priority Credit Agreement, or any refinancing thereof; provided,
that, notwithstanding anything to the contrary contained herein, the Borrower
shall be permitted to prepay or repurchase revolving loans outstanding under
the 2012 Second Priority Credit Agreement so long as (x) no Default or
Event of Default has occurred and (y) there shall be no corresponding
reduction of the commitments thereunder.


 


Section 5.17. Coverage Test.  The
Borrower shall not permit the Coverage Ratio to be (x) at any time prior
to the issuance of any Second Priority Secured Exchange Notes, less than 1.20
to 1.00 or (y) at any time from and after the issuance of any Second
Priority Secured Exchange Notes, less than 1.30 to 1.00 (each such Coverage
Ratio requirement, a “Coverage Test”).


 


Section 5.18. Forward Equity Contracts.  The
Borrower shall not enter into any forward equity contracts.


 


Section 5.19. Restrictive Agreements.  The
Borrower shall not, and shall not permit any Subsidiary to, directly or indirectly,
enter into, incur or permit to exist any agreement or other arrangement that
prohibits, restricts or imposes any condition upon (a) the ability of such



 


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Person or any of its subsidiaries to create, incur or permit to exist
any Lien upon any of its property or assets, or (b) the ability of any
Subsidiary to pay dividends or other distributions with respect to any shares
of its capital stock or to make or repay loans or advances to the Borrower or any
other Subsidiary or to guarantee Indebtedness of the Borrower or any other
Subsidiary; provided that (i) the foregoing shall not apply to
restrictions and conditions imposed by law or by any Loan Document, (ii) the
foregoing shall not apply to restrictions and conditions existing on the date
hereof pursuant to leases, participation agreements, co-lending (or analogous)
agreements, intercreditor (or analogous) agreements or contracts, governing
documents pertaining to Venture LLCs and documents evidencing, securing,
governing and/or guarantying any asset which restrictions and conditions (x) are
not unusual for similar transactions in the relevant market, and (y) when
taken as a whole, would not have a material adverse effect on the Banks’
interests in the Collateral (it being understood, however, that the foregoing
shall apply to any extension, renewal, amendment or modification expanding the
scope of, any such restriction or condition), (iii)  the foregoing shall
not apply to customary restrictions and conditions contained in agreements
relating to the sale of a Subsidiary pending such sale, provided such
restrictions and conditions apply only to the Subsidiary that is to be sold and
such sale is permitted hereunder, (iv) clause (a) of the foregoing
shall not apply to restrictions or conditions imposed by any agreement relating
to secured Indebtedness permitted by this Agreement if such restrictions or
conditions apply only to the property or assets securing such Indebtedness and (v) clause
(a) of the foregoing shall not apply to customary provisions in leases,
participation agreements, co-lending (or analogous) agreements, intercreditor
(or analogous) agreements and other contracts, in each case, restricting the
assignment thereof.


 


Section 5.20. Limitation on Activities of the Collateral
SPVs.  The Borrower shall not permit any
Collateral SPV to (i) conduct, transact or otherwise engage in, or commit
to conduct, transact or otherwise engage in, any business or operations other
than ownership of Eligible Assets and anything incidental thereto or (ii) incur,
create, assume or suffer to exist any Indebtedness or other liabilities or
financial obligations, except (v) Indebtedness incurred pursuant to Section 5.14(b),
(w) nonconsensual obligations imposed by operation of law, (x) obligations
with respect to its equity interests, (y) obligations in the ordinary
course of business in the operation of its assets and (z) the statutory
liability of any general partner for the liabilities of the limited partnership
in which it is a general partner.


 


Section 5.21.
Transactions with Affiliates.  The Borrower will not, and will not permit
any of its Subsidiaries to, sell, lease or otherwise transfer any property or
assets to, or purchase, lease or otherwise acquire any property or assets from,
or otherwise engage in any other transactions with, any of its Affiliates,
except (a) in the ordinary course of business at prices and on terms and
conditions not less favorable to the Borrower or such Subsidiary than could be
obtained on an arm’s-length basis from unrelated third parties, (b) transactions
between or among the Borrower and its Subsidiaries not involving any other
Affiliate and (c)  any payment of dividends, other restricted payments or
other transaction permitted by Section 5.10(e) or Section 5.16.


 


Section 5.22.
Post-Closing Covenants. 
Within 90 days following the Closing Date, (i) the Borrower shall
deliver to the Collateral Trustee each Deposit Account Control Agreement in
connection with any Collateral SPV Deposit Accounts and any Collateral LLC
Deposit Accounts (including any Collateral SPV Deposit Accounts or any
Collateral LLC 


 


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Deposit Accounts established
for the purpose of holding British Pound Sterling, Euros, Canadian Dollars or
any other currency other than Dollars) required to be delivered pursuant to the
Security Agreement and the Collateral Trust Agreement, in each case, in form
and substance reasonably acceptable to the Administrative Agent and the Collateral
Trustee, and (ii) the Borrower shall deliver to the Collateral Trustee any
Deposit Account Control Agreement or Securities Account Control Agreement in
connection with the Collateral Account (as defined in the Collateral Trust
Agreement) (including any Collateral Accounts established for the purpose of
holding British Pound Sterling, Euros, Canadian Dollars or any other currency
other than Dollars) required to be delivered pursuant to the Security Agreement
and the Collateral Trust Agreement, in each case, in form and substance
reasonably acceptable to the Administrative Agent and the Collateral Trustee.


 


ARTICLE VI




DEFAULTS


 


Section 6.1. Events of Default.  An “Event
of Default” shall have occurred if one or more of the following events shall
have occurred and be continuing:


 


(a)           the Borrower shall fail to (i) pay
when due any principal of any Loan or Letter of Credit reimbursement
obligation, or (ii) the Borrower shall fail to pay when due interest on
any Loan or Letter of Credit reimbursement obligation or any fees or any other
amount payable to the Administrative Agent or the Banks hereunder and the same
shall continue for a period of five (5) days after the same becomes due;
or


 


(b)           the Borrower shall fail to observe or
perform any covenant contained in Section 2.12, Section 2.24,
5.1(d)(i), 5.10, 5.11, 5.12, 5.13, 5.14, 5.15, 5.16, 5.17, 5.18, 5.19, 5.20, 5.21or 5.22 and, (i) solely
in the case of any failure to comply with Section 5.17, such failure shall
continue unremedied for a period of 10 days after written notice thereof has
been given to the Borrower by the Administrative Agent and (ii) solely in
the case of any failure to comply with Section 5.1(d)(i), such failure
shall continue unremedied for a period of 10 days; or


 


(c)           the Borrower or any Guarantor shall
fail to observe or perform any covenant or agreement contained in this
Agreement or any other Loan Document (other than those covered by clause (a),
(b), (e), (f), (g), (h), (i), (l), (n) or (o) of this Section 6.1)
for 30 days after written notice thereof has been given to the Borrower by the
Administrative Agent; or if such default is of such a nature that it cannot
with reasonable effort be completely remedied within said period of thirty (30)
days such additional period of time as may be reasonably necessary to cure
same, provided the Borrower commences such cure within said thirty (30) day
period and diligently prosecutes same, until completion, but in no event shall
such extended period exceed ninety (90) days; or


 


(d)           any representation, warranty,
certification or statement that is made by the Borrower or any Guarantor in
this Agreement, in any other Loan Document or that is contained in any
certificate, financial statement or other document delivered pursuant to this
Agreement or any other Loan Document, shall prove to have been incorrect in any
material respect when made 


 


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(or deemed made) and, with
respect to such representations, warranties, certifications or statements not
known by the Borrower at the time made or deemed made to be incorrect, the
defect causing such representation or warranty to be incorrect in a material
respect when made (or deemed made) is not removed, corrected or cured within
thirty (30) days after the earlier of written notice thereof from the
Administrative Agent to the Borrower and the Borrower otherwise obtains
knowledge thereof; or


 


(e)           the Borrower or any Subsidiary shall
default in the payment when due (whether by scheduled maturity, required
prepayment, acceleration, demand or otherwise) of any amount owing in respect
of any Recourse Debt (other than the Obligations) for which the aggregate
outstanding principal amounts exceed $75,000,000 and such default shall
continue beyond the giving of any required notice and the expiration of any
applicable grace period and such default has not been waived, in writing, by
the holder of any such Recourse Debt; or the Borrower or any Subsidiary shall
default in the performance or observance of any obligation or condition with
respect to any such Recourse Debt or any other event shall occur or condition
exist beyond the giving of any required notice and the expiration of any
applicable grace period, if the effect of such default, event or condition is
to accelerate the maturity of any such indebtedness or to permit (without any
further requirement of notice or lapse of time) the holder or holders thereof,
or any trustee or agent for such holders, to accelerate the maturity of any
such indebtedness; or


 


(f)            the Borrower or any Subsidiary of
the Borrower or any Investment Affiliate of the Borrower to which, either
individually or in the aggregate, $100,000,000 or more of the Borrower’s
Consolidated Tangible Net Worth is attributable, shall commence a voluntary
case or other proceeding seeking liquidation, reorganization or other relief
with respect to itself or its debts under any bankruptcy, insolvency or other
similar law now or hereafter in effect or seeking the appointment of a trustee,
receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, or shall consent to any such relief or to the
appointment of or taking possession by any such official in an involuntary case
or other proceeding commenced against it, or shall make a general assignment
for the benefit of creditors, or shall fail generally to pay its debts as they
become due, or shall take any action to authorize any of the foregoing; or


 


(g)           an involuntary case or other
proceeding shall be commenced against the Borrower or any Subsidiary of the
Borrower or any Investment Affiliate of the Borrower to which, either
individually or in the aggregate, $100,000,000 or more of the Borrower’s
Consolidated Tangible Net Worth is attributable, seeking liquidation,
reorganization or other relief with respect to it or its debts under any
bankruptcy, insolvency or other similar law now or hereafter in effect or
seeking the appointment of a trustee, receiver, liquidator, custodian or other
similar official of it or any substantial part of its property, and such
involuntary case or other proceeding shall remain undismissed and unstayed for
a period of 90 days; or an order for relief shall be entered against the
Borrower, any such Subsidiary of the Borrower or any such Investment Affiliate  under the federal bankruptcy laws as now or
hereafter in effect; or


 


(h)           one or more final, non-appealable
judgments or decrees in an aggregate amount of $75,000,000 or more shall be
entered by a court or courts of competent jurisdiction against the Borrower or
any Subsidiary of the Borrower (other than any judgment as to which, and only
to the extent, a reputable insurance company has acknowledged coverage of such
claim 


 


77

















 


in writing), and (i) any
such judgments or decrees shall not be stayed, discharged, paid, bonded or
vacated within ninety (90) days or (ii) enforcement proceedings shall be
commenced by any creditor on any such judgments or decrees; or


 


(i)            there shall be a replacement of a
majority of the Board of Directors of the Borrower over a two-year period from
the directors who constituted the Board of Directors of the Borrower at the
beginning of such period, and such replacement shall not have been approved by
a vote of at least a majority of the Board of Directors of the Borrower then
still in office who were either members of such Board of Directors at the
beginning of such period or whose election as a member of such Board of
Directors was previously so approved; or


 


(j)            any Person or “group” (as such term
is defined in applicable federal securities laws and regulations) shall become
the owner, directly or indirectly, beneficially or of record, of shares
representing more than forty  percent
(40%) of the aggregate ordinary voting power represented by the issued and
outstanding common shares of the Borrower; or


 


(k)           if any Termination Event with respect
to a Plan or Multiemployer Plan shall occur as a result of which Termination
Event or Events any member of the ERISA Group has incurred or may incur any
liability to the PBGC or any other Person and the sum (determined as of the
date of occurrence of such Termination Event) of the insufficiency of such Plan
or Multiemployer Plan and the insufficiency of any and all other Plans and
Multiemployer Plans with respect to which such a Termination Event shall occur
and be continuing (or, in the case of a Multiple Employer Plan with respect to
which a Termination Event described in clause (ii) of the definition of
Termination Event shall occur and be continuing and in the case of a liability
with respect to a Termination Event which is or could be a liability of the
Borrower rather than a liability of the Plan, the liability of the Borrower) is
equal to or greater than $10,000,000 and which the Required Banks reasonably
determine will have a Material Adverse Effect; or


 


(l)            if, any member of the ERISA Group
shall commit a failure described in Section 302(f)(1) of ERISA or Section 412(n)(1) of
the Code and the amount of the lien determined under Section 302(f)(3) of
ERISA or Section 412(n)(3) of the Code that could reasonably be
expected to be imposed on any member of the ERISA Group or their assets in
respect of such failure shall be equal to or greater than $10,000,000 and which
the Required Banks reasonably determine will have a Material Adverse Effect; or


 


(m)          any assets of the Borrower shall
constitute “assets” (within the meaning of ERISA or Section 4975 of the
Code, including but not limited to 29 C.F.R. § 2510.3-101 or any successor
regulation thereto) of an “employee benefit plan” within the meaning of Section 3(3) of
ERISA or a “plan” within the meaning of Section 4975(e)(1) of the
Code; or


 


(n)           at any time, for any reason the
Borrower or any Guarantor repudiates in writing its payment obligations under
any Loan Document; or


 


(o)           the guarantee of any
Guarantor contained in the Guarantee Agreement shall cease, for any reason, to
be in full force and effect or any Guarantor shall so assert, other than in
connection with a merger of a Guarantor with and into the Borrower, as
permitted by Section 5.11, or any release of a Guarantor pursuant to Section 9.17; or


 


78
















 


(p)           any Collateral
Document shall not, for any reason, be in full force and effect (or any Loan
Party party to such Collateral Document shall so assert), or any security
interest purported to be created by any of the Collateral Documents shall not
be a valid, enforceable and perfected security interest having the priority
required by the Collateral Documents (or any Loan Party party to such
Collateral Document shall so assert) (other than (i) pursuant to the terms
of this Agreement or any other Loan Document (including any release pursuant to
the terms hereof or thereof) or (ii) as a result of acts or omissions by
the Administrative Agent or Collateral Trustee); or


 


(q)           at any time (i) Borrower
shall fail to directly own and control 100% of the outstanding equity interests
in iStar Tara Holdings LLC, (ii) iStar Tara Holdings LLC shall fail to
directly own and control 100% of the outstanding equity interests in iStar Tara
LLC, or (iii) iStar Tara LLC shall fail to directly or indirectly own and
control 100 % of the outstanding equity interests in any Collateral SPV (other
than iStar Tara Holdings LLC) or any Collateral LLC.


 


Section 6.2. Rights and Remedies.  (a) Upon
the occurrence of any Event of Default described in Section 6.1(f) or
Section 6.1(g), the Commitments shall immediately terminate and the unpaid
principal amount of, and any and all accrued interest on, the Loans and any and
all accrued fees and other Obligations hereunder shall automatically become
immediately due and payable, with all additional interest from time to time
accrued thereon and without presentation, demand, or protest or other
requirements of any kind (including, without limitation, valuation and
appraisement, diligence, presentment, notice of intent to demand or accelerate
and notice of acceleration), all of which are hereby expressly waived by the
Borrower for itself; and upon the occurrence and during the continuance of any
other Event of Default, the Administrative Agent, following consultation with
the Banks, may (and upon the demand of the Required Banks shall), by written
notice to the Borrower, in addition to the exercise of all of the rights and
remedies permitted the Administrative Agent, the Collateral Trustee and the
Banks at law or equity or under any of the other Loan Documents, declare that
the Commitments are terminated and declare the unpaid principal amount of and
any and all accrued and unpaid interest on the Loans and any and all accrued
fees and other Obligations hereunder to be, and the same shall thereupon be, immediately
due and payable with all additional interest from time to time accrued thereon
and (except as otherwise provided in the Loan Documents) without presentation,
demand, or protest or other requirements of any kind (including, without
limitation, valuation and appraisement, diligence, presentment, notice of
intent to demand or accelerate and notice of acceleration), all of which are
hereby expressly waived by the Borrower for itself.


 


(b)           Notwithstanding anything to the
contrary contained in this Agreement or in any other Loan Document, the
Administrative Agent and the Banks each agree that any exercise or enforcement
of the rights and remedies granted to the Administrative Agent or the Banks
under this Agreement or any other Loan Document or at law or in equity with
respect to this Agreement or any other Loan Documents shall be commenced and
maintained solely by the Administrative Agent, in each case on behalf of the
Administrative Agent, any other Agent and/or the Banks. The Administrative
Agent shall act at the direction of the Required Banks in connection with the
exercise of any and all remedies at law, in equity or under any of the Loan
Documents or, if the Required Banks are unable to reach agreement after being
afforded reasonable notice and opportunity to consent, then, from and after an
Event of Default, the Administrative Agent may pursue such rights and remedies
as it may determine.


 


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Section 6.3. Notice of Default.  The
Administrative Agent shall give notice to the Borrower under Section 6.1(b),
Section 6.1(c) and Section 6.1(d) promptly upon being
requested to do so by the Required Banks and shall thereupon notify all the
Banks thereof.  The Administrative Agent
shall not be deemed to have knowledge or notice of the occurrence of any
Default or Event of Default (other than nonpayment of principal of or interest
on the Loans) unless the Administrative Agent has received notice in writing
from a Bank or the Borrower referring to this Agreement or the other Loan
Documents, describing such event or condition. 
Should the Administrative Agent receive notice of the occurrence of a
Default or Event of Default expressly stating that such notice is a notice of a
Default or Event of Default, or should the Administrative Agent send the
Borrower a notice of Default or Event of Default, the Administrative Agent
shall promptly give notice thereof to each Bank.


 


Section 6.4. Actions in Respect of Letters of Credit.  (a) If,
at any time and from time to time, any Letter of Credit shall have been issued
hereunder and an Acceleration Event in respect of this Agreement shall have
occurred and be continuing, then, upon the occurrence and during the
continuation of any Acceleration Event in respect of this Agreement, the
Borrower shall pay to the Administrative Agent, on behalf of the Banks, in same
day funds at the Administrative Agent’s office designated in such demand, for
deposit in a special cash collateral account (the “Letter of Credit
Collateral Account”) to be maintained in the name of the Administrative
Agent (on behalf of the Banks) and under its sole dominion and control at such
place as shall be designated by the Administrative Agent, an amount equal to
the amount of the Letter of Credit Usage under the Letters of Credit (less any
amounts then held in the Collateral Account under the Collateral Trust
Agreement to secure obligations in respect of the Letters of Credit pursuant to
Section 3.5 of the Collateral Trust Agreement).  Interest shall accrue on the Letter of Credit
Collateral Account at a rate equal to the rate on overnight funds.


 


(b)           The Borrower hereby pledges, assigns
and grants to the Administrative Agent, as administrative agent for its benefit
and the ratable benefit of the Banks a lien on and a security interest in, the
following collateral (the “Letter of Credit Collateral”):


 


(i)                    the Letter
of Credit Collateral Account, all cash deposited therein and all certificates
and instruments, if any, from time to time representing or evidencing the
Letter of Credit Collateral Account;


 


(ii)                   all notes,
certificates of deposit and other instruments from time to time hereafter
delivered to or otherwise possessed by the Administrative Agent for or on
behalf of the Borrower in substitution for or in respect of any or all of the
then existing Letter of Credit Collateral;


 


(iii)                  all
interest, dividends, cash, instruments and other property from time to time
received, receivable or otherwise distributed in respect of or in exchange for
any or all of the then existing Letter of Credit Collateral; and


 


(iv)                  to the
extent not covered by the above clauses, all proceeds of any or all of the
foregoing Letter of Credit Collateral.


 


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The lien and security interest
granted hereby secures the payment of all Obligations of the Borrower now or
hereafter existing hereunder and under any other Loan Document.


 


(c)           The Borrower hereby authorizes the
Administrative Agent for the ratable benefit of the Banks to apply, from time
to time after funds are deposited in the Letter of Credit Collateral Account
and for so long as an Acceleration Event has occurred and in continuing, funds
then held in the Letter of Credit Collateral Account to the payment of any
amounts, in such order as the Administrative Agent may elect, as shall have
become due and payable by the Borrower to the Banks in respect of the Letters
of Credit.


 


(d)           Neither the Borrower nor any Person
claiming or acting on behalf of or through the Borrower shall have any right to
withdraw any of the funds held in the Letter of Credit Collateral Account,
except as provided in Section 6.4(h) hereof.


 


(e)           The Borrower agrees that it will not (i) sell
or otherwise dispose of any interest in the Letter of Credit Collateral or (ii) create
or permit to exist any lien, security interest or other charge or encumbrance
upon or with respect to any of the Letter of Credit Collateral, except for the
security interest created by this Section 6.4.


 


(f)            If any Acceleration Event shall have
occurred and be continuing:


 


(i)                    The
Administrative Agent may, in its sole discretion, without notice to the
Borrower except as required by law and at any time from time to time, charge,
set off or otherwise apply all or any part of first, (x) amounts previously
drawn on any Letter of Credit that have not been reimbursed by the Borrower and
(y) any Letter of Credit Usage described in clause (ii) of the
definition thereof that are then due and payable and second, any other unpaid
Obligations then due and payable against the Letter of Credit Collateral
Account or any part thereof, in such order as the Administrative Agent shall
elect. The rights of the Administrative Agent under this Section 6.4 are
in addition to any rights and remedies which any Bank may have.


 


(ii)                   The
Administrative Agent may also exercise, in its sole discretion, in respect of
the Letter of Credit Collateral Account, in addition to the other rights and
remedies provided herein or otherwise available to it, all the rights and
remedies of a secured party upon default under the Uniform Commercial Code in
effect in the State of New York at that time.


 


(g)           The Administrative Agent shall be
deemed to have exercised reasonable care in the custody and preservation of the
Letter of Credit Collateral if the Letter of Credit Collateral is accorded
treatment substantially equal to that which the Administrative Agent accords
its own property, it being understood that, assuming such treatment, the
Administrative Agent shall not have any responsibility or liability with
respect thereto.


 


(h)           Any surplus of the funds held in the
Letter of Credit Collateral Account and remaining after payment in full of all
of the Obligations of the Borrower hereunder and under any other Loan Document
after the Maturity Date shall be paid promptly to the Borrower or to whomsoever
may be lawfully entitled to receive such surplus.


 


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Section 6.5. Distribution of Proceeds after Default.  Subject
to the provisions of the Collateral Trust Agreement and notwithstanding
anything contained herein to the contrary,
from and after an Event of Default, to the extent proceeds are received by the
Administrative Agent, such proceeds shall be distributed to the Banks pro rata
in accordance with the unpaid principal amount of the Loans and Letter of
Credit reimbursement obligations (giving effect to any participations granted
therein pursuant to Section 2.4, Section 2.19 and Section 9.6).


 


ARTICLE VII


 


THE AGENTS; CERTAIN MATTERS RELATING TO THE BANKS


 


Section 7.1. Appointment and Authorization.  Each
Bank irrevocably appoints and authorizes the Administrative Agent to take such
action as agent on its behalf, including execution of the other Loan Documents,
and to exercise such powers under this Agreement and the other Loan Documents
as are delegated to the Administrative Agent by the terms hereof or thereof,
together with all such powers as are reasonably incidental thereto.  Except as set forth in Section 7.8
hereof, the provisions of this Article VII are solely for the benefit of
the Administrative Agent, the other Agents and the Banks, and the Borrower
shall not have any rights to rely on or enforce any of the provisions
hereof.  In performing its functions and
duties under this Agreement and the other Loan Documents, the Administrative
Agent shall act solely as an agent of the Banks and shall not assume and shall
not be deemed to have assumed any obligation toward or relationship of agency
or trust with or for the Borrower or any other Loan Party.  Notwithstanding any provision to the contrary
elsewhere in this Agreement, the Agents shall not have any duties or
responsibilities, except those expressly set forth herein, or any fiduciary
relationship with any Bank, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against the Agents.


 


Section 7.2. Agency and Affiliates. 
JPMorgan Chase Bank, N.A., Citicorp North America, Inc. and Bank of
America, N.A. each has the same rights and powers under this Agreement as any
other Bank and may exercise or refrain from exercising the same as though it
were not the Administrative Agent or a Syndication Agent, as applicable, and
JPMorgan Chase Bank, N.A., Citicorp North America, Inc. and Bank of
America, N.A. and each of their affiliates may accept deposits from, lend money
to, and generally engage in any kind of business with the Borrower or any
Subsidiary or affiliate of the foregoing as if they were not the Administrative
Agent or a Syndication Agent, as applicable, hereunder, and the term “Bank” and
“Banks” shall include each of JPMorgan Chase Bank, N.A., Citicorp North America, Inc.
and Bank of America, N.A., each in its individual capacity.


 


Section 7.3. Action by Agents.  The
obligations of each of the Agents hereunder are only those expressly set forth
herein.  Without limiting the generality
of the foregoing, each of the Agents shall not be required to take any action
with respect to any Default or Event of Default, except as expressly provided
in Article VI.  The duties of each
Agent shall be administrative in nature. 
Subject to the provisions of Section 7.1, Section 7.5 and Section 7.6,
each Agent shall administer the Loans in the same manner as each administers
its own loans.


 


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Section 7.4. Consultation with Experts.  As
between any Agent on the one hand and the Banks on the other hand, such Agent
may consult with legal counsel (who may be counsel for the Borrower),
independent public accountants and other experts selected by it and shall not
be liable for any action taken or omitted to be taken by it in good faith in
accordance with the advice of such counsel, accountants or experts.


 


Section 7.5. Liability of Agents.  As
between each Agent on the one hand and the Banks on the other hand, none of the
Agents nor any of their affiliates nor any of their respective directors,
officers, agents or employees shall be liable for any action taken or not taken
by it in connection herewith (i) with the consent or at the request of the
Required Banks or (ii) in the absence of its own gross negligence or
willful misconduct.  As between each
Agent on the one hand and the Banks on the other hand, none of the Agents nor
any of their respective directors, officers, agents or employees shall be
responsible for or have any duty to ascertain, inquire into or verify (i) any
statement, warranty or representation made in connection with this Agreement,
any other Loan Document, or any Borrowing hereunder; (ii) the performance
or observance of any of the covenants or agreements of the Borrower or any
other Loan Party; (iii) the satisfaction of any condition specified in Article III,
except receipt of items required to be delivered to such Agent, or (iv) the
validity, effectiveness or genuineness of this Agreement, the other Loan
Documents or any other instrument or writing furnished in connection herewith.
As between each Agent on the one hand and the Banks on the other hand, none of
the Agents shall incur any liability by acting in reliance upon any notice,
consent, certificate, statement, or other writing (which may be a bank wire,
telex or similar writing) believed by it to be genuine or to be signed by the
proper party or parties.


 


Section 7.6. Indemnification.  Each
Bank shall, ratably in accordance with its undrawn Commitment and Loans
outstanding, indemnify the Agents and their affiliates and their respective
directors, officers, agents and employees (to the extent not reimbursed by the
Borrower) against any cost, expense (including, without limitation, counsel
fees and disbursements), claim, demand, action, loss or liability (except such
as result from such indemnitee’s gross negligence or willful misconduct) that
such indemnitee may suffer or incur in connection with its duties as Agent
under this Agreement, the other Loan Documents or any action taken or omitted
by such indemnitee hereunder.  In the
event that any Agent shall, subsequent to its receipt of indemnification
payment(s) from Banks in accordance with this section, recoup any amount
from the Borrower, or any other party liable therefor in connection with such
indemnification, such Agent shall reimburse the Banks which previously made the
payment(s) pro rata, based upon the actual amounts which were theretofore
paid by each Bank.  Each Agent shall
reimburse such Banks so entitled to reimbursement within two (2) Business
Days of its receipt of such funds from the Borrower or such other party liable
therefor.


 


Section 7.7. Credit Decision.  Each
Bank acknowledges that it has, independently and without reliance upon any
Agent or any other Bank, 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 Bank also
acknowledges that it will, independently and without reliance upon any Agent or
any other Bank, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking any action under this Agreement.


 


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Section 7.8. Successor Agent.  The Administrative Agent may
resign at any time by giving notice thereof to the Banks and the Borrower.  Upon any such resignation, the Required Banks
shall have the right to appoint a successor Administrative Agent, which
successor Administrative Agent shall; provided no Event of Default has
occurred and is then continuing, be subject to the Borrower’s approval, which
approval shall not be unreasonably withheld or delayed.  If no successor Administrative Agent shall
have been so appointed by the Required Banks and approved by the Borrower, and
shall have accepted such appointment, within 30 days after the retiring
Administrative Agent gives notice of resignation, then the retiring
Administrative Agent may, on behalf of the Banks, appoint a successor
Administrative Agent which shall be the Administrative Agent, who shall act
until the Required Banks shall appoint an Administrative Agent.  Any appointment of a successor Administrative
Agent by Required Banks or the retiring Administrative Agent, pursuant to the
preceding sentence shall; provided no Event of Default has occurred and
is then continuing, be subject to the Borrower’s approval, which approval shall
not be unreasonably withheld or delayed. 
Upon the acceptance of its appointment as the Administrative Agent
hereunder by a successor Administrative Agent, such successor Administrative
Agent shall thereupon succeed to and become vested with all the rights and
duties of the retiring Administrative Agent and the retiring Administrative
Agent, shall be discharged from its duties and obligations hereunder.  After any retiring Administrative Agent’s
resignation hereunder, the provisions of this Article shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was the
Administrative Agent.  For gross
negligence or willful misconduct, as determined by all the Banks (excluding for
such determination the Administrative Agent, in its capacity as a Bank), the
Administrative Agent may be removed at any time by giving at least thirty (30)
Business Days’ prior written notice to the Administrative Agent and the
Borrower.  Such resignation or removal
shall take effect upon the acceptance of appointment by a successor
Administrative Agent in accordance with the provisions of this Section 7.8.


 


Section 7.9. Consents and Approvals.  All
communications from the Administrative Agent to the Banks requesting the Banks’
determination, consent, approval or disapproval (i) shall be given in the
form of a written notice to each Bank, (ii) shall be accompanied by a
description of the matter or item as to which such determination, approval,
consent or disapproval is requested, or shall advise each Bank where such
matter or item may be inspected, or shall otherwise describe the matter or
issue to be resolved, (iii) shall include, if reasonably requested by a
Bank and to the extent not previously provided to such Bank, written materials
and a summary of all oral information provided to the Administrative Agent by
the Borrower in respect of the matter or issue to be resolved, and (iv) shall
include the Administrative Agent’s recommended course of action or determination
in respect thereof ).  Each Bank shall
reply promptly, but in any event within ten (10) Business Days after
receipt of the request therefor from the Administrative Agent (the “Bank
Reply Period”).  With respect to
decisions requiring the approval of the Required Banks, or all the Banks or the
Administrative Agent, as the case may be, shall submit its recommendation or
determination for approval of or consent to such recommendation or
determination to all Banks and upon receiving the required approval or consent
shall follow the course of action or determination of the Required Banks or all
the Banks, as the case may be.


 


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ARTICLE VIII


 


CHANGE IN CIRCUMSTANCES


 


Section 8.1. Basis for Determining Interest Rate
Inadequate or Unfair.  If on or prior to the first day of any
Interest Period for any Euro-Currency Borrowing the Administrative Agent or the
Required Banks determine in good faith that deposits in Dollars or the
applicable Alternate Currency (in the applicable amounts) are not being offered
in the relevant market for such Interest Period or that the
Euro-Currency Rate for such Interest Period will not adequately reflect the
cost to the Banks or the Required Banks, as the case may be, of making, funding
or maintaining such Euro-Currency Borrowing for such Interest Period, the Administrative Agent shall forthwith
give notice thereof to the Borrower and the Banks, whereupon until the
Administrative Agent notifies the Borrower that the circumstances giving rise
to such suspension no longer exist, the obligations of the Banks to make,
continue, or convert Loans into, Euro-Currency Loans in Dollars or the
applicable Alternate Currency, as the case may be, shall be suspended.  In such event, unless the Borrower notifies
the Administrative Agent on or before the second (2nd) Euro-Currency Business Day before, but
excluding, the date of any Euro-Currency Borrowing for which a Notice of
Borrowing has previously been given that it elects not to borrow on such date,
such Borrowing shall instead be made as a Base Rate Borrowing.


 


Section 8.2. Illegality.  If, on or after the date of
this Agreement, the adoption of any applicable law, rule or regulation, or
any change in any applicable law, rule or regulation, or any change in the
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by any Bank (or its Euro-Currency Lending Office) with any
request or directive (whether or not having the force of law) made after the
Closing Date of any such authority, central bank or comparable agency shall
make it unlawful for any Bank (or its Euro-Currency Lending Office) to make,
maintain or fund its Euro-Currency Loans in a particular currency, the
Administrative Agent shall forthwith give notice thereof to the other Banks and
the Borrower, whereupon until such Bank notifies the Borrower and the
Administrative Agent that the circumstances giving rise to such suspension no
longer exist, the obligation of such Bank in the case of the event described
above to make Euro-Currency Loans in such currency, shall be suspended. With
respect to Euro-Currency Loans, before giving any notice to the Administrative Agent
pursuant to this Section 8.2, such Bank shall designate a different
Euro-Currency Lending Office if such designation will avoid the need for giving
such notice and will not, in the reasonable judgment of such Bank, be otherwise
commercially disadvantageous to such Bank.


 


If at any time, it shall be unlawful for any Bank to make, maintain or
fund any of its Euro-Currency Loans, the Borrower shall have the right, upon
five (5) Business Days’ notice to the Administrative Agent, to either (x) cause
a bank, reasonably acceptable to the Administrative Agent, to offer to purchase
the Loans and/or Commitments of such Bank for an amount equal to such Bank’s
outstanding Loans and/or Commitments, together with accrued and unpaid interest
and fees thereon and all other amounts due to such Bank are concurrently
therewith paid in full to such Bank, and to become a Bank hereunder, or obtain
the agreement of one or more existing Banks to offer to purchase the Loans
and/or Commitments of such Bank for such amount, which offer such Bank is
hereby required to accept, or (y) to repay in full all Loans 


 


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then
outstanding of such Bank, together with interest due thereon and any and all
fees and other amounts due hereunder, upon which event, such Bank’s Commitments
shall be deemed to be canceled pursuant to Section 2.11(d).


 


Section 8.3. Increased Cost and Reduced Return.


 


(a)           If, on or after the date hereof, the
adoption of any applicable law, rule or regulation, or any change in any
applicable law, rule or regulation, or any change in the interpretation or
administration thereof by any governmental authority, central bank or
comparable agency charged with the interpretation or administration thereof, or
compliance by any Bank (or its Applicable Lending Office) with any request or
directive (whether or not having the force of law) made after the Closing Date
of any such authority, central bank or comparable agency, shall impose, modify
or deem applicable any reserve (including, without limitation, any such
requirement imposed by the Board of Governors of the Federal Reserve System
(but excluding with respect to any Euro-Currency Loan any such requirement
reflected in an applicable Euro-Currency Reserve Percentage)), special deposit,
insurance assessment or similar requirement against assets of, deposits with or
for the account of, or credit extended by, any Bank (or its Applicable Lending
Office) or shall impose on any Bank (or its Applicable Lending Office) or on
the interbank market any other condition materially more burdensome in nature,
extent or consequence than those in existence as of the date hereof affecting
such Bank’s Euro-Currency Loans or its obligation to make Euro-Currency Loans,
and the result of any of the foregoing is to increase the cost to such Bank (or
its Applicable Lending Office) of making or maintaining any Euro-Currency Loan,
or to reduce the amount of any sum received or receivable by such Bank (or its
Applicable Lending Office) under this Agreement or under its Note with respect
to such Euro-Currency Loans, by an amount reasonable determined by such Bank to
be material, then, within 15 days after demand by such Bank (with a copy to the
Administrative Agent), the Borrower shall pay to such Bank such additional
amount or amounts (based upon a reasonable allocation thereof by such Bank to
the Euro-Currency Loans made by such Bank hereunder) as will compensate such
Bank for such increased cost or reduction to the extent such Bank generally
imposes such additional amounts on other borrowers of such Bank in similar
circumstances.


 


(b)           If any Bank shall have reasonably
determined that, after the date hereof, the adoption of any applicable law, rule or
regulation regarding capital adequacy, or any change in any such law, rule or
regulation, or any change in the interpretation or administration thereof by
any governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or any request or directive regarding
capital adequacy (whether or not having the force of law) made after the
Closing Date of any such authority, central bank or comparable agency, has or
would have the effect of reducing the rate of return on capital of such Bank
(or its Parent) as a consequence of such Bank’s obligations hereunder to a
level below that which such Bank (or its Parent) could have achieved but for
such adoption, change, request or directive (taking into consideration its
policies with respect to capital adequacy) by an amount reasonably deemed by
such Bank to be material, then from time to time, within 15 days after demand
by such Bank (with a copy to the Administrative Agent), the Borrower shall pay
to such Bank such additional amount or amounts as will compensate such Bank (or
its Parent) for such reduction to the extent such Bank generally imposes such
additional amounts on other borrowers of such Bank in similar circumstances.


 


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(c)           Each Bank will promptly notify the
Borrower and the Administrative Agent of any event of which it has knowledge,
occurring after the date hereof, which will entitle such Bank to compensation
pursuant to this Section and will designate a different Applicable Lending
Office if such designation will avoid the need for, or reduce the amount of,
such compensation and will not, in the reasonable judgment of such Bank, be
otherwise disadvantageous to such Bank. 
Notwithstanding the foregoing, if such Bank shall fail to notify the
Borrower of any such event within ninety (90) days following the end of the
month during which such event occurred, then the Borrower’s liability for any
amounts described in this Section incurred by such Bank as a result of
such event shall be limited to those attributable to the period occurring
subsequent to the ninetieth (90th) day prior to, but excluding, the date upon
which such Bank actually notified the Borrower of the occurrence of such event.
A certificate of any Bank claiming compensation under this Section and
setting forth a reasonably detailed calculation of the additional amount or
amounts to be paid to it hereunder shall be conclusive in the absence of
demonstrable error.  In determining such
amount, such Bank may use any reasonable averaging and attribution methods.


 


(d)           If at any time, any Bank has demanded
compensation pursuant to this Section 8.3, the Borrower shall have the
right, upon five (5) Business Day’s notice to the Administrative Agent to
either (x) cause a Qualified Institution, reasonably acceptable to the Administrative
Agent, to offer to purchase the Commitments of such Bank for an amount equal to
such Bank’s outstanding Loans plus accrued interest, fees and other amounts due
to such Bank, and to become a Bank hereunder, or to obtain the agreement of one
or more existing Banks to offer to purchase the Commitments of such Bank for
such amount, which offer such Bank is hereby required to accept, or (y) to
repay in full all Loans then outstanding of such Bank, together with interest
and all other amounts due thereon, upon which event, such Bank’s Commitment
shall be deemed to be canceled pursuant to Section 2.11(d).


 


Section 8.4. Taxes.


 


(a)           Any and all payments by the Borrower
to or for the account of any Bank or the Administrative Agent hereunder or
under any other Loan Document shall be made free and clear of and without
deduction for any and all present or future taxes, duties, levies, imposts,
deductions, charges or withholdings, and all liabilities with respect thereto,
excluding, in the case of each Bank and the Administrative Agent, taxes imposed
on its income, and franchise taxes imposed on it, by the jurisdiction under the
laws of which such Bank or the Administrative Agent (as the case may be) is
organized or any political subdivision thereof and, in the case of each Bank,
taxes imposed on its income, and franchise or similar taxes imposed on it, by
the jurisdiction of such Bank’s Applicable Lending Office or any political
subdivision thereof or by any other jurisdiction (or any political subdivision
thereof) as a result of a present or former connection between such Bank or the
Administrative Agent and such other jurisdiction or by the United States,
except to the extent that such connection would not have arisen but for
entering into the transactions contemplated hereby (all such non-excluded
taxes, duties, levies, imposts, deductions, charges, withholdings and
liabilities being hereinafter referred to as “Non-Excluded Taxes”). If
the Borrower shall be required by law to deduct any Non-Excluded Taxes from or
in respect of any sum payable hereunder or under any Note or Letter of Credit, (i) the
sum payable shall be increased as necessary so that after making all required
deductions (including, without limitation, deductions applicable to additional
sums payable under this Section 8.4) such Bank, 


 


87

















 


the Fronting Bank or the
Administrative Agent (as the case may be) receives an amount equal to the sum
it would have received had no such deductions been made, (ii) the Borrower
shall make such deductions, (iii) the Borrower shall pay the full amount
deducted to the relevant taxation authority or other authority in accordance
with applicable law and (iv) the Borrower shall furnish to the
Administrative Agent, at its address referred to in Section 9.1, the
original or a certified copy of a receipt evidencing payment thereof.


 


(b)           In addition, the Borrower agrees to
pay any present or future stamp or documentary taxes and any other excise or
property taxes, or charges or similar levies which arise from any payment made
hereunder or under any Note or Letter of Credit or from the execution or
delivery of, or otherwise with respect to, this Agreement, any Letter of Credit
or any other Loan Document (hereinafter referred to as “Other Taxes”).


 


(c)           In the event that Non-Excluded Taxes
not imposed on the Closing Date are imposed, or Non-Excluded Taxes imposed on
the Closing Date increase, the applicable Bank shall notify the Administrative
Agent and the Borrower of such event in writing within a reasonable period
following receipt of knowledge thereof. 
Notwithstanding the foregoing, if such Bank shall fail to notify the
Borrower of any such event within ninety (90) days following the end of the
month during which such event occurred, then the Borrower’s liability for such
additional Non-Excluded Taxes incurred by such Bank as a result of such event
(including payment of a make whole amount under Section 8.4(a)(i)) shall
be limited to those attributable to the period occurring subsequent to the
ninetieth (90th) day prior to, but excluding, the date upon which such Bank actually
notified the Borrower of the occurrence of such event.


 


(d)           The Borrower agrees to indemnify each
Bank, the Fronting Bank and the Administrative Agent for the full amount of
Non-Excluded Taxes or Other Taxes (including, without limitation, any
Non-Excluded Taxes or Other Taxes imposed or asserted by any jurisdiction on
amounts payable under this Section 8.4) paid by such Bank, the Fronting
Bank or the Administrative Agent (as the case may be) and, so long as such
Bank, the Fronting Bank or Administrative Agent has promptly paid any such
Non-Excluded Taxes or Other Taxes, any liability for penalties and interest
arising therefrom or with respect thereto. 
This indemnification shall be made within 15 days from the date such
Bank, the Fronting Bank or the Administrative Agent (as the case may be) makes
demand therefor.


 


(e)           Each Bank or the Administrative Agent
that is a United States person for U.S. federal income tax purposes, on or
prior to the date of its execution and delivery of this Agreement in the case
of each Bank and the Administrative Agent listed on the signature pages hereof
and on or prior to the date on which it becomes a Bank or the Administrative
Agent in the case of each other Bank or the Administrative Agent, shall provide
the Borrower with two duly completed copies of Internal Revenue Service Form W-9
or any successor form prescribed by the Internal Revenue Service and shall
provide the Borrower with two further copies of any such form on or before the
date any such form or certification expires or becomes obsolete and after the
occurrence of any event requiring a change in the most recent form previously
delivered to the Borrower.  Each Bank and
the Administrative Agent that is not a United States person for U.S. federal
income tax purposes, on or prior to the date of its execution and delivery of
this Agreement in the case of each Bank and the Administrative Agent listed on
the signature pages hereof and on or prior to the date on which it becomes
a Bank or the Administrative Agent in the 


 


88

















 


case of each other Bank or
the Administrative Agent, shall provide the Borrower with two duly completed copies
of an Internal Revenue Service Form W-8BEN or W-8ECI, as applicable to
such Bank or the Administrative Agent, or any successor form prescribed by the
Internal Revenue Service, and shall provide the Borrower with two further
copies of any such form on or before the date that any such form expires or
becomes obsolete and after the occurrence of any event requiring a change in
the most recent form previously delivered by it to the Borrower.  A Bank that provides copies of the Internal
Revenue Service Form W-8BEN and that is legally entitled to claim the
portfolio interest exemption pursuant to Section 881(c) of the
Internal Revenue Code of 1986, as amended (the “Code”), shall further
provide the Borrower with, together with such Internal Revenue Service Form W-8BEN,
a written confirmation of its entitlement to such exemption.  To the extent that it is legally entitled to
do so, a Bank shall properly claim that such Bank is entitled to benefits under
an income tax treaty to which the United States is a party which reduces the
rate of, or eliminates, withholding tax on payments of interest hereunder.  A Bank that is not a United States person and
that grants a participating interest in a Loan or Commitment to any other
person shall provide, in addition to its own forms specified above, the
Borrower with two duly completed copies of the Internal Revenue Service form
applicable to such other person, each under the cover of an Internal Revenue
Service Form W-8IMY and a withholding statement prepared in the manner
prescribed by the Internal Revenue Service, or such other forms and/or
certificates that it is legally entitled to provide evidencing such participant’s
entitlement to any exemption from, or reduction in the rate of U.S. withholding
tax, and shall provide the Borrower with two further copies of any such forms
and statements on or before the date any such forms or statements expire or
become obsolete and after the occurrence of any event requiring a change in the
most recent form or statement previously delivered to the Borrower.  If a Bank fails to timely and properly
provide or update such forms or statements or if the form or statement provided
by a Bank at the time such Bank first becomes a party to this Agreement
indicates a United States withholding tax rate in excess of zero, then backup
withholding or withholding tax resulting from the foregoing shall be considered
excluded from “Non-Excluded Taxes” as defined in Section 8.4(a).


 


(f)            Upon reasonable demand by, and at
the expense of, the Borrower to the Administrative Agent or any Bank, the
Administrative Agent or Bank, as the case may be, shall deliver to the
Borrower, or to such government or taxing authority as the Borrower may
reasonably direct, any form or document that may be required or reasonably
requested in writing in order to allow the Borrower to make a payment to or for
the account of such Bank or the Administrative Agent hereunder or under any
other Loan Document without any deduction or withholding for or on account of
any Non-Excluded Taxes or with such deduction or withholding at a reduced rate
(so long as the completion, execution or submission of such form or document
would not materially prejudice the legal or commercial position of the party in
receipt of such demand), with any such form or document to be accurate and
completed in a manner reasonably satisfactory to the Borrower making such
demand and to be executed and to be delivered with any reasonably required
certification.


 


(g)           For any period with respect to which
a Bank has failed to provide the Borrower with the appropriate form pursuant to
(and to the extent required by) Section 8.4(e) (unless such failure
is due to a change in treaty, law or regulation occurring subsequent to the
date on which a form originally was required to be provided), such Bank shall
not be entitled to indemnification under Section 8.4(d) with respect
to Non-Excluded Taxes imposed by the United 


 


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States; provided, however,
that should a Bank, which is otherwise exempt from or subject to a reduced rate
of withholding tax, become subject to Non-Excluded Taxes because of its failure
to deliver a form required hereunder, the Borrower shall take such steps as
such Bank shall reasonably request to assist such Bank to recover such Taxes so
long as the Borrower shall incur no cost or liability as a result thereof.


 


(h)           If the Borrower is required to pay
additional amounts to or for the account of any Bank pursuant to this Section 8.4,
then such Bank will change the jurisdiction of its Applicable Lending Office so
as to eliminate or reduce any such additional payment which may thereafter
accrue if such change, in the reasonable judgment of such Bank, is not
otherwise disadvantageous to such Bank.


 


(i)            If at any time, any Bank has
demanded compensation pursuant to Section 8.3 or Section 8.4 or the
obligation of such Bank of make Euro-Currency Loans has been suspended pursuant
to Section 8.2, in any such case, the Borrower shall have the right, upon
five (5) Business Day’s notice to the Administrative Agent to either (x) cause
a Qualified Institution, reasonably acceptable to the Administrative Agent, to
offer to purchase the Commitments of such Bank for an amount equal to such Bank’s
outstanding Loans plus accrued interest, fees and other amounts due to such
Bank, and to become a Bank hereunder, or to obtain the agreement of one or more
existing Banks to offer to purchase the Commitments of such Bank for such
amount, which offer such Bank is hereby required to accept, or (y) to
repay in full all Loans then outstanding of such Bank, together with interest
and all other amounts due thereon, upon which event, such Bank’s Commitment
shall be deemed to be canceled pursuant to Section 2.11(d).


 


Section 8.5. Base Rate Loans Substituted for Affected
Euro-Currency Loans.  If (i) the obligation of any Bank to
make Euro-Currency Loans has been suspended pursuant to Section 8.2 or (ii) any
Bank has demanded compensation under Section 8.3 or Section 8.4 with
respect to its Euro-Currency Loans and the Borrower shall, by at least five
Business Days’ prior notice to such Bank through the Administrative Agent, have
elected that the provisions of this Section shall apply to such Bank,
then, unless and until such Bank notifies the Borrower that the circumstances
giving rise to such suspension or demand for compensation no longer exist:


 


(a)           the Borrower shall be deemed to have
delivered a Notice of Interest Rate Election with respect to such affected
Euro-Currency Loans and thereafter all Loans which would otherwise be made by
such Bank to the Borrower as Euro-Currency Loans shall be made instead as Base
Rate Loans and no Borrowing from such Bank would take effect with respect to
Multicurrency Revolving Credit Loans denominated in an Alternate Currency; and


 


(b)           after each of its Euro-Currency Loans
has been repaid, all payments of principal which would otherwise be applied to
repay such Euro-Currency Loans shall be applied to repay its Base Rate Loans
instead; and


 


(c)           the Borrower will not be required to
make any payment which would otherwise be required by Section 2.16 with
respect to such Euro-Currency Loans converted to Base Rate Loans pursuant to
clause (a) above.


 


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ARTICLE IX


 


MISCELLANEOUS


 


Section 9.1. Notices.  All notices, requests and
other communications to any party hereunder shall be in writing (including bank
wire, facsimile transmission followed by telephonic confirmation or similar
writing) and shall be given to such party: 
(x) in the case of the Borrower and the Administrative Agent, at
its address or facsimile number set forth on Exhibit H attached hereto
with duplicate copies thereof, in the case of the Borrower, to the Borrower, at
its address set forth on the signature page hereof, to its General Counsel
and Chief Financial Officer, (y) in the case of any Bank, at its address
or facsimile number set forth in its Administrative Questionnaire or (z) in
the case of any party, such other address or facsimile number and/or email
address as such party may hereafter specify for the purpose by notice to the
Administrative Agent and the Borrower. 
Each such notice, request or other communication shall be effective (i) if
given by telex or facsimile transmission, when such facsimile is transmitted to
the facsimile number specified in this Section and the appropriate
answerback or facsimile confirmation is received, (ii) if given by
certified registered mail, return receipt requested, with first class postage
prepaid, addressed as aforesaid, upon receipt or refusal to accept delivery, (iii) if
given by a nationally recognized overnight carrier, 24 hours after such
communication is deposited with such carrier with postage prepaid for next day
delivery, or (iv) if given by any other means, when delivered at the
address specified in this Section; provided that notices to the Administrative
Agent under Article II or Article VIII shall not be effective until
actually received.


 


Section 9.2. No Waivers.  No failure or delay by the
Administrative Agent or any Bank in exercising any right, power or privilege
hereunder or under any Note shall operate as a waiver thereof nor shall any
single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, power or privilege.  The rights and remedies herein provided shall
be cumulative and not exclusive of any rights or remedies provided by law.


 


Section 9.3. Expenses; Indemnification.


 


(a)           The Borrower shall pay within thirty (30) days after
written notice from the Administrative Agent or any Joint Lead Arranger, (i) all
reasonable out-of-pocket costs and expenses of the Administrative Agent
(including, without limitation, reasonable and documented fees and
disbursements of special counsel Simpson Thacher & Bartlett LLP ), or
such Joint Lead Arranger, as applicable, in connection with any waiver or
consent hereunder or any amendment hereof or any Default or alleged Default
hereunder, (ii) all reasonable and documented fees and disbursements of
special counsel in connection with the syndication of the Loans, and (iii) if
an Event of Default occurs, all reasonable out-of-pocket expenses incurred by
the Administrative Agent, each Joint Lead Arranger and each Bank, including,
without limitation, reasonable and invoiced fees and disbursements of counsel
for the Administrative Agent, each of the Joint Lead Arrangers and each of the
Banks, in connection with the enforcement of the Loan Documents and the
instruments referred to therein and such Event of Default and collection,
bankruptcy, insolvency and other enforcement proceedings resulting therefrom
(provided, however, that the attorneys’ fees and disbursements for which the
Borrower is obligated under this subsection 


 


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(a)(iii) shall be limited to the reasonable and invoiced
non-duplicative fees and disbursements of (A) counsel for the
Administrative Agent, (B) counsel for the Joint Lead Arrangers as a group
and (C) counsel for all of the Banks as a group; and provided, further,
that all other costs and expenses for which the Borrower is obligated under
this subsection (a)(iii) shall be limited to the reasonable and invoiced
non-duplicative costs and expenses of the Administrative Agent). For purposes
of this subsection (a)(iii), (1) counsel for the Administrative Agent
shall mean a single outside law firm representing the Administrative Agent, (2) counsel
for the Joint Lead Arrangers shall mean a single outside law firm representing
the Joint Lead Arrangers as a group (which law firm may or may not be the same
law firm representing the Administrative Agent) and (3) counsel for all of
the Banks as a group shall mean a single outside law firm representing such
Banks as a group (which law firm may or may not be the same law firm
representing the Administrative Agent).


 


(b)           The Borrower agrees to indemnify each Agent and each Bank,
their respective affiliates and the respective directors, officers, agents and
employees of the foregoing (each an “Indemnitee”) and hold each
Indemnitee harmless from and against any and all liabilities, losses, damages,
costs and expenses of any kind, including, without limitation, the reasonable
fees and disbursements of counsel, which may be incurred by such Indemnitee in
connection with any investigative, administrative or judicial proceeding that
may at any time (including, without limitation, at any time following the
payment of the Obligations) be asserted against any Indemnitee, as a result of,
or arising out of, or in any way related to or by reason of, (i) any of
the transactions contemplated by the Loan Documents or the execution, delivery
or performance of any Loan Document, (ii) any violation by the Borrower or
the Environmental Affiliates of any applicable Environmental Law, (iii) any
Environmental Claim arising out of the management, use, control, ownership or
operation of property or assets by the Borrower or any of the Environmental
Affiliates, including, without limitation, all on-site and off-site activities
of the Borrower or any Environmental Affiliate involving Materials of
Environmental Concern, (iv) the breach of any environmental representation
or warranty set forth herein, but excluding those liabilities, losses, damages,
costs and expenses (a) for which such Indemnitee has been compensated
pursuant to the terms of this Agreement or that are excluded under Section 8.3,
(b) incurred solely by reason of the gross negligence or willful
misconduct of such Indemnitee as finally determined by a court of competent
jurisdiction, (c) arising from any violation of Environmental Law relating
to a Property, which violation is caused by the act or omission of such
Indemnitee after such Indemnitee takes possession of such Property or (d) owing
by such Indemnitee to any third party based upon contractual obligations of
such Indemnitee owing to such third party which are not expressly set forth in
the Loan Documents. In addition, the indemnification set forth in this Section 9.3(b) in
favor of any director, officer, agent or employee of any Agent or any Bank
shall be solely in their respective capacities as such director, officer, agent
or employee.  The Borrower’s obligations
under this Section shall survive the termination of this Agreement and the
payment of the Obligations.  Without
limitation of the other provisions of this Section 9.3, the Borrower shall
indemnify and hold each of the Agents and the Banks free and harmless from and
against all loss, costs (including reasonable and documented attorneys’ fees and
expenses), expenses, taxes, and damages (including consequential damages) that
the Agents and the Banks may suffer or incur by reason of the investigation,
defense and settlement of claims and in obtaining any prohibited transaction
exemption under ERISA or the Code necessary in the Administrative Agent’s
reasonable 


 


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judgment by reason of the inaccuracy of the representations and
warranties, or a breach of the provisions, set forth in Section 4.6(b).


 


Section 9.4. Sharing of Set-Offs.  In
addition to any rights now or hereafter granted under applicable law or
otherwise, and not by way of limitation of any such rights, upon the occurrence
and during the continuance of any Event of Default, each Bank is hereby
authorized at any time or from time to time, without presentment, demand,
protest or other notice of any kind to the Borrower or to any other Person, any
such notice being hereby expressly waived, to set off and to appropriate and
apply any and all deposits (general or special, time or demand, provisional or
final) and any other indebtedness at any time held or owing by such Bank
(including, without limitation, by branches, agencies and Affiliates of such
Bank wherever located) to or for the credit or the account of the Borrower
against and on account of the Obligations of the Borrower then due and payable
to such Bank under this Agreement or under any of the other Loan Documents,
including, without limitation, all interests in Obligations purchased by such
Bank.  Each Bank agrees that if it shall,
by exercising any right of set-off or counterclaim or otherwise, receive
payment of a proportion of the aggregate amount of principal and interest due
with respect to any Loan made by it or Letter of Credit participated in by it
or, in the case of the Fronting Bank, Letter of Credit issued by it, which is
greater than the proportion received by any other Bank or Letter of Credit
issued or participated in by such other Bank, the Bank receiving such
proportionately greater payment shall purchase such participations in the Loans
made by the other Banks, and such other adjustments shall be made, as may be
required so that all such payments of principal and interest with respect to
the Loans made by the Banks or Letter of Credit issued or participated in by
such other Bank shall be shared by the Banks pro rata; provided that nothing in
this Section shall impair the right of any Bank to exercise any right of
set-off or counterclaim it may have to any deposits not received in connection
with the Loans and to apply the amount subject to such exercise to the payment
of indebtedness of the Borrower other than its indebtedness under the Loans or
the Letters of Credit.  The Borrower agrees,
to the fullest extent it may effectively do so under applicable law, that any
holder of a participation in a Commitment, a Loan or a Letter of Credit,
whether or not acquired pursuant to the foregoing arrangements, may exercise
rights of set-off or counterclaim and other rights with respect to such
participation as fully as if such holder of a participation were a direct
creditor of the Borrower in the amount of such participation.  Notwithstanding anything to the contrary
contained herein, any Bank may, by separate agreement with the Borrower, waive
its right to set off contained herein or granted by law and any such written
waiver shall be effective against such Bank under this Section 9.4.


 


Section 9.5.
Amendments and
Waivers.


 


(a)  
Any provision of this Agreement or the Notes or the Letters of Credit or
other Loan Documents may be amended or waived if, but only if, such amendment
or waiver is in writing and is signed by the Borrower and the Required Banks
(and, if the rights or duties of the Administrative Agent or the Swingline
Lender in their respective capacity as the Administrative Agent or the
Swingline Lender, as applicable are affected thereby, by the Administrative
Agent or the Swingline Lender, as applicable); provided that (A) the
Administrative Agent may, with the consent of Borrower only, amend, modify or
supplement this Agreement or any other Loan Document in connection with the
addition or substitution of Collateral in accordance with the terms of this
Agreement, in each case, which amendment, 


 


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modification or supplement does not adversely
affect the rights of any Bank, (B) no amendment or waiver with respect to
this Agreement, the Notes, the Letters of Credit or any other Loan Document
shall, unless signed by each Bank directly affected thereby, (i) reduce
the principal of or rate of interest on any Loan or any Letter of Credit
reimbursement obligation or any fees hereunder, (ii) postpone, whether
through forbearance or otherwise, the date fixed for any payment of principal of
or interest on any Loan or any Letter of Credit reimbursement obligation or any
fees hereunder or for any reduction or termination of any Commitment, (iii) reduce
the percentage specified in the definition of “Required Banks” or “Super-Majority
Banks” or otherwise change the aggregate unpaid principal amount of the Loans,
or the number of Banks, which shall be required for the Banks or any of them to
take any action under this Section or any other provision of this
Agreement or any Collateral Document, (iv) release any Guarantor under the
Guarantees (except as expressly permitted by the Guarantees or this Agreement)
or release any Collateral under the Collateral Documents (except as expressly
permitted by the Collateral Documents or this Agreement), (v) release any
Letter of Credit Collateral, (vi) amend, modify or waive any provision of Section 2.12,
(vii) amend, modify or waive the definition of “Pro Rata Share” or any
other provision that provides for the ratable or pro rata nature of
disbursements by or payments to Banks; provided that only the consent of
the Required Banks shall be necessary for any such amendment, modification or
waiver of the minimum Discount referred to in Section 2.13, (viii) modify
the provisions of this Section 9.5 or (ix) increase, extend or
restate the Commitment of any Bank or subject any Bank to any additional
obligation and (C) no amendment or waiver with respect to this Agreement,
the Notes or any other Loan Document shall, unless signed by the Super-Majority
Banks, (i) amend, modify or waive any provision of Section 5.17, (ii) amend,
modify or waive the definitions of “Borrowing Base Value”, “Collateral”, “Coverage
Ratio”, “Coverage Test” or any component definition of any of the foregoing if
such amendment, modification or waiver is intended to have the effect of making
more credit available or to reduce the collateral coverage therefor, (iii) amend,
modify or waive the definition of “Principal Collateral Payment Event” or any
component definition thereof, (iv) amend, modify or waive any provision of
Section 2.15 in any manner adverse to the Banks, (v) approve the
incurrence of any security interests senior to, or pari passu with, the Liens
securing the Obligations hereunder or (vi) amend, modify or waive any
provision of Section 8 of the Collateral Trust Agreement or Section 3.4
of the Collateral Trust Agreement, in each case in any manner adverse to the
Banks.  Notwithstanding anything to the
contrary contained herein, no Defaulting Bank shall have any right to approve
or disapprove any amendment, waiver or consent hereunder, except that (x) the
Commitment of such Defaulting Bank may not be increased or extended without the
consent of such Defaulting Bank and (y) the interest rate or fees due to
such Defaulting Bank shall not be reduced (it being understood that any
Commitments or Loans held or deemed held by any Defaulting Bank shall be
excluded for purposes of making a determination of Required Banks pursuant to
this Section 9.5).


 


(b)  
Notwithstanding anything to the contrary contained herein, the
Administrative Agent is hereby authorized by each Bank to enter into any
amendment to or modification of the Collateral Trust Agreement in connection
with the issuance of any Second Priority Exchange Notes or Junior Priority Secured
Exchange Notes solely to the extent necessary to effect such amendments as may
be necessary or appropriate, in the reasonable opinion of the Administrative
Agent, in connection with any such issuance expressly permitted hereunder
(including any such amendment contemplated by Section 6.3(c) or (d) of
the 


 


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Collateral Trust Agreement), so long as such
amendment or modification does not adversely affect the rights of any Bank.


 


(c)  
The Administrative Agent may, but shall have no obligation to, with the
concurrence of any Bank, execute amendments, modifications, waivers or consents
on behalf of such Bank.  Any waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which it was given.  No
notice to or demand on any Loan Party in any case shall entitle any Loan Party
to any other or further notice or demand in similar or other
circumstances.  Any amendment,
modification, termination, waiver or consent effected in accordance with this Section 9.5
shall be binding upon each Bank at the time outstanding, each future Bank and,
if signed by a Loan Party, on such Loan Party.


 


Section 9.6. Successors and Assigns.


 


(a)           The provisions of this Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
permitted assigns, except that (i) the Borrower may not assign or
otherwise transfer any of its rights under this Agreement or the other Loan
Documents without the prior written consent of all Banks and the Administrative
Agent and (ii) a Bank may not assign or otherwise transfer any of its
interest under this Agreement except as permitted in subsection (b) and (c) of
this Section 9.6.


 


(b)           Prior to the occurrence of an Event of Default, any Bank
may at any time, grant to a then existing Bank or any Affiliate thereof, one or
more banks, finance companies, insurance companies or other financial
institutions or trusts (a “Participant”) participating interests in its
Commitment or any or all of its Loans. 
After the occurrence and during the continuance of an Event of Default,
any Bank may at any time grant to any Person in any amount (also a “Participant”),
participating interests in its Commitment or any or all of its Loans.  Any participation made during the
continuation of an Event of Default shall not be affected by the subsequent
cure of such Event of Default.  In the
event of any such grant by a Bank of a participating interest to a Participant,
whether or not upon notice to the Borrower and the Administrative Agent, such
Bank shall remain responsible for the performance of its obligations hereunder,
and the Borrower and the Administrative Agent shall continue to deal solely and
directly with such Bank in connection with such Bank’s rights and obligations
under this Agreement.  Any agreement
pursuant to which any Bank may grant such a participating interest shall
provide that such Bank shall retain the sole right and responsibility to
enforce the obligations of the Borrower hereunder including, without
limitation, the right to approve any amendment, modification or waiver of any
provision of this Agreement or any other Loan Document; provided that such
participation agreement may provide that such Bank will not agree to any modification,
amendment or waiver of this Agreement described in clause (i), (ii), (iii) or
(iv) of Section 9.5(a)(B) without the consent of the
Participant. The Borrower agrees that each Participant shall, to the extent
provided in its participation agreement, be entitled to the benefits of Article VIII
with respect to its participating interest.


 


(c)           Any Bank may at any time assign to a Qualified Institution
(in each case, an “Assignee”) (i) prior to the occurrence of an
Event of Default, in minimum amounts of not less than $5,000,000 and integral
multiples of $1,000,000 thereafter (or any lesser amount in the case of
assignments to an existing Bank or any Affiliate thereof or in the case of an
assignment 


 


95

















 


of a Bank’s entire Commitment) and (ii) after the occurrence and
during the continuance of an Event of Default, in any amount, all or a
proportionate part of all, of its rights and obligations under this Agreement,
the Notes and the other Loan Documents, and, in either case, such Assignee
shall assume such rights and obligations, pursuant to a Transfer Supplement in
substantially the form of Exhibit I hereto executed by such Assignee and
such transferor Bank; provided, that if no Event of Default shall have
occurred and be continuing, such assignment shall be subject to the
Administrative Agent’s, the Fronting Bank’s (if a Person other than the
Administrative Agent and if the assignment involves any Revolving Credit
Commitment) and the Borrower’s consent, which consent shall not be unreasonably
withheld or delayed; and provided further that if an Assignee is an Affiliate
of such transferor Bank or was a Bank or Affiliate thereof immediately prior to
such assignment, no such consent shall be required from the Borrower or the
Administrative Agent or the Fronting Bank. 
Upon execution and delivery of such instrument and payment by such
Assignee to such transferor Bank of an amount equal to the purchase price
agreed between such transferor Bank and such Assignee, such Assignee shall be a
Bank party to this Agreement and shall have all the rights and obligations of a
Bank with a Commitment as set forth in such instrument of assumption, and no
further consent or action by any party shall be required and the transferor
Bank shall be released from its obligations hereunder to a corresponding
extent. Upon the consummation of any assignment pursuant to this subsection
(c), the transferor Bank, the Administrative Agent and the Borrower shall make
appropriate arrangements so that, if requested or required, a new Note is
issued to the Assignee upon the return to the Borrower of the old Note, if any,
marked “cancelled”.  In connection with
any such assignment (other than an assignment by a Bank to an affiliate), the
transferor Bank shall pay to the Administrative Agent an administrative fee for
processing such assignment in the amount of $3,500.  If the Assignee is not organized under the
laws of the United States of America or a state thereof, it shall deliver to
the Borrower and the Administrative Agent certification as to exemption from
deduction or withholding of any United States federal income taxes in
accordance with Section 8.4.  Any
assignment made during the continuation of an Event of Default shall not be
invalidated by any subsequent cure of such Event of Default.


 


(d)           Any Bank may at any time assign all or any portion of its
rights under this Agreement and its Note and the Letter(s) of Credit
participated in by such Bank or, in the case of the Fronting Bank, issued by
it, to a Federal Reserve Bank.  No such
assignment shall release the transferor Bank from its obligations hereunder.


 


(e)           No Assignee, Participant or other transferee of any Bank’s
rights shall be entitled to receive any greater payment under Section 8.3
or Section 8.4 than such Bank would have been entitled to receive with
respect to the rights transferred, unless such transfer is made (i) with
the Borrower’s prior written consent or (ii) by reason of the provisions
of Section 8.2, Section 8.3or Section 8.4 requiring such Bank to
designate a different Applicable Lending Office under certain circumstances or
at a time when the circumstances giving rise to such greater payment did not
exist.


 


(f)            No Assignee of any rights and obligations under this
Agreement shall be permitted to further assign less than all of such rights and
obligations.  No Participant in any
rights and obligations under this Agreement shall be permitted to sell
subparticipations of such rights and obligations.


 


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(g)           Anything in this Agreement to the contrary
notwithstanding, so long as no Event of Default shall have occurred and be
continuing, no Bank shall be permitted to enter into an assignment of, or sell
a participation interest in, its rights and obligations hereunder which would
result in such Bank holding a Commitment without participants of less than
$5,000,000 unless as a result of a cancellation or reduction of the aggregate
Commitments; provided, however, that no Bank shall be prohibited from assigning
its entire Commitment so long as such assignment is otherwise permitted under
this Section 9.6.


 


(h)           The Administrative Agent shall maintain on behalf
of the Borrower a register of the names, addresses and contact information of the
Banks and each of their assignees, and the Commitments of, and principal
amounts of the Loans and interest owing to, each Bank pursuant to the terms
hereof from time to time.


 


Section 9.7. Governing Law; Submission to Jurisdiction;
Judgment Currency.  (a) THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND
THEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAWS OF
THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO THE PRINCIPLES THEREOF RELATING
TO CONFLICTS OF LAW).


 


(b)           Any legal action or proceeding with respect to this
Agreement or any other Loan Document and any action for enforcement of any
judgment in respect thereof may be brought in the courts of the State of New
York or of the United States of America for the Southern District of New York,
in each case, which are located in New York County, and, by execution and
delivery of this Agreement, the Borrower hereby accepts for itself and in
respect of its property, generally and unconditionally, the non-exclusive
jurisdiction of the aforesaid courts and appellate courts from any
thereof.  The Borrower irrevocably
consents, for itself, to the service of process out of any of the
aforementioned courts in any such action or proceeding by the hand delivery, or
mailing of copies thereof by registered or certified mail, postage prepaid, to
the Borrower at its address set forth below its signature hereto.  The Borrower hereby, for itself, irrevocably
waives any objection which it may now or hereafter have to the laying of venue
of any of the aforesaid actions or proceedings arising out of or in connection
with this Agreement or any other Loan Document brought in the courts referred
to above and hereby further irrevocably waives and agrees not to plead or claim
in any such court that any such action or proceeding brought in any such court
has been brought in an inconvenient forum. 
Nothing herein shall affect the right of the Administrative Agent to
serve process in any other manner permitted by law or to commence legal
proceedings or otherwise proceed against the Borrower in any other
jurisdiction.


 


(c)           If for the purpose of obtaining judgment in any court it
is necessary to convert a sum due hereunder in one currency into another
currency, the parties hereto agree, to the fullest extent that they may
effectively do so under applicable law, that the rate of exchange used shall be
the spot rate at which in accordance with normal banking procedures the first
currency could be purchased in New York City with such other currency by the
person obtaining such judgment on the Business Day preceding that on which
final judgment is given.


 


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(d)           The parties agree, to the fullest extent that they may
effectively do so under applicable law, that the obligations of the Borrower to
make payments in any currency of the principal of and interest on the Loans of
the Borrower and any other amounts due from the Borrower hereunder to the
Administrative Agent as provided herein (i) shall not be discharged or
satisfied by any tender, or any recovery pursuant to any judgment (whether or
not entered in accordance with Section 9.7(c)), in any currency other than
the relevant currency, except to the extent that such tender or recovery shall
result in the actual receipt by the Administrative Agent at its relevant office
on behalf of the Banks of the full amount of the relevant currency expressed to
be payable in respect of the principal of and interest on the Loans and all other
amounts due hereunder (it being assumed for purposes of this clause (i) that
the Administrative Agent will convert any amount tendered or recovered into the
relevant currency on the date of such tender or recovery), (ii) shall be
enforceable as an alternative or additional cause of action for the purpose of
recovering in the relevant currency the amount, if any, by which such actual
receipt shall fall short of the full amount of the relevant currency so
expressed to be payable and (iii) shall not be affected by an unrelated
judgment being obtained for any other sum due under this Agreement.


 


Section 9.8. Counterparts; Integration; Effectiveness.  This
Agreement may be signed in any number of counterparts, each of which shall be
an original, with the same effect as if the signatures thereto and hereto were
upon the same instrument.  This Agreement
constitutes the entire agreement and understanding among the parties hereto and
supersedes any and all prior agreements and understandings, oral or written,
relating to the subject matter hereof. 
This Agreement shall become effective upon receipt by the Administrative
Agent and the Borrower of counterparts hereof signed by each of the parties
hereto (or, in the case of any party as to which an executed counterpart shall
not have been received, receipt by the Administrative Agent in form
satisfactory to it of telegraphic, telex or other written confirmation from
such party of execution of a counterpart hereof by such party).


 


Section 9.9. WAIVER OF JURY TRIAL.  EACH
OF THE BORROWER, THE AGENTS AND THE BANKS HEREBY IRREVOCABLY WAIVE ANY AND ALL
RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO
THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.


 


Section 9.10. Survival.  All indemnities set forth
herein shall survive the execution and delivery of this Agreement and the other
Loan Documents and the making and repayment of the Loans hereunder.


 


Section 9.11. Domicile of Loans. 
Subject to the provisions of Article VIII, each Bank may transfer
and carry its Loans at, to or for the account of any domestic or foreign branch
office, subsidiary or affiliate of such Bank.


 


Section 9.12. Limitation of Liability.  No
claim may be made by the Borrower or any other Person acting by or through the
Borrower against the Administrative Agent, any Syndication Agent or any Bank or
the affiliates, directors, officers, employees, attorneys or agent of any of
them for any punitive damages in respect of any claim for breach of contract or
any other theory of liability arising out of or related to the transactions
contemplated by this Agreement or by the other Loan Documents, or any act,
omission or event occurring in 


 


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connection therewith; and the Borrower hereby
waives, releases and agrees not to sue upon any claim for any such damages,
whether or not accrued and whether or not known or suspected to exist in its
favor.


 


Section 9.13. Recourse Obligation.  This
Agreement and the Obligations hereunder are fully recourse to the Borrower and
each Guarantor.  Notwithstanding the
foregoing, no recourse under or upon any obligation, covenant, or agreement
contained in this Agreement shall be had against any officer, director, shareholder
or employee of the Borrower or any Guarantor except in the event of fraud or
misappropriation of funds on the part of such officer, director, shareholder or
employee.


 


Section 9.14. Confidentiality.  Each
of the Administrative Agent, the Syndication Agents, the Joint Lead Arrangers,
the Joint Bookrunners, the Fronting Bank and the Banks understands that some of
the information furnished to it pursuant to this Agreement and the other Loan
Documents may be received by it prior to the time that such information shall
have been made public, and each of the Administrative Agent, the Syndication
Agents, the Joint Lead Arrangers, the Joint Bookrunners, the Fronting Bank and
the Banks hereby agrees that it will keep all Information (as defined below)
received by it confidential except that the Administrative Agent, the
Syndication Agents, the Joint Lead Arrangers, the Joint Bookrunners, the
Fronting Bank and each Bank shall be permitted to disclose Information (i) only
to such of its officers, directors, employees, agents, auditors and buyers as
need to know such information in connection with this Agreement or any other
Loan Document and who will be advised of the confidential nature of such
Information; (ii) to any other party to this Agreement; (iii) to a
proposed Assignee or Participant in accordance with Section 9.6 hereof or
to a counterparty or prospective counterparty (or its advisors) to any swap or
derivative transaction relating to the Borrower and its obligations hereunder,
provided such Person agrees in writing to keep such Information confidential on
terms substantially similar to this Section 9.14; (iv) to the extent
required by applicable law and regulations or by any subpoena or other legal
process; (v) to the extent requested by any bank regulatory authority or
other regulatory authority or self-regulatory organization; (vi) to the
extent such information becomes publicly available other than as a result of a
breach of this Agreement; (vii) to the extent the Borrower shall have
consented to such disclosure or (viii) in connection with any legal or
other enforcement proceeding in connection with any Loan Document or any of the
transaction contemplated thereby. For the purposes of this Section, “Information”
means all information received from the Borrower or its respective officers,
directors, employees, agents, auditors, lawyers and Affiliates relating to the
Borrower or any of its Subsidiaries or Affiliates (including Investment
Affiliates) or any of their respective businesses other than information that
is generally available to the public.  In
the event of any required disclosure of Information, any Person required to
maintain the confidentiality of such Information as provided in this Section 9.14
agrees to use reasonable efforts to inform the Borrower as promptly as
practicable of the circumstances and the Information required to be disclosed
to the extent not prohibited by applicable law.


 


Section 9.15. USA Patriot Act.  Each
Bank hereby notifies the Borrower that pursuant to the requirements of the USA
Patriot Act (Title III of Pub.  L. 107-56
(signed into law October 26, 2001)) (the “Patriot Act”), it is
required to obtain, verify and record information that identifies the Borrower,
which information includes the name and address of the Borrower and


 


99

















 


other information that will allow such Bank
to identify the Borrower in accordance with the Patriot Act.


 


Section 9.16.
Acknowledgments.  The Borrower hereby acknowledges that:


 


(a)           it has been advised by counsel in the negotiation, execution
and delivery of this Agreement and the other Loan Documents;


 


(b)           neither the Administrative Agent nor any Bank has any
fiduciary relationship with or duty to the Borrower arising out of or in
connection with this Agreement or any of the other Loan Documents, and the
relationship between Administrative Agent and Banks, on one hand, and the
Borrower, on the other hand, in connection herewith or therewith is solely that
of debtor and creditor; and


 


(c)            no joint venture is created hereby or by the other Loan
Documents or otherwise exists by virtue of the transactions contemplated hereby
among the Banks or among the Borrower and the Banks.


 


Section 9.17. Releases of Guarantees and Liens.


 


(a)           Notwithstanding anything to the contrary contained herein
or in any other Loan Document, the Administrative Agent is hereby irrevocably
authorized by each Bank (without requirement of notice to or consent of any
Bank except as expressly required by Section 9.5) to take any action
requested by the Borrower or any Guarantor having the effect of releasing any
Collateral or any Guarantor from its guarantee obligations (i) to the
extent necessary to permit consummation of any transaction permitted by any
Loan Document or that has been consented to in accordance with Section 9.5
or (ii) under the circumstances described in paragraph (b) below.


 


(b)           At
such time as the Loans and the other Obligations under the Loan Documents shall
have been paid in full, the Commitments have been terminated and no Letters of
Credit shall be outstanding, the Collateral shall be released from the Liens
created by the Collateral Documents, and the Collateral Documents and all
obligations (other than those expressly stated to survive such termination) of
the Administrative Agent and each Loan Party under the Collateral Documents
shall terminate, all without delivery of any instrument or performance of any
act by any Person.


 


Section 9.18. Delivery of Promissory
Notes.  Each Bank shall promptly, and
in any event not later than three Business Days after the Closing Date,
surrender to the Borrower for subsequent cancellation any promissory notes
issued to such Bank under the Existing 2006 Credit Agreement (or provide a lost
note affidavit in respect thereof).


 


[remainder of page intentionally left blank;
signature pages follow]


 


100

















 


IN WITNESS WHEREOF, the parties hereto have
caused this Agreement to be duly executed by their respective authorized
officers as of the day and year first above written.


 


 


	
   

  	
  iSTAR FINANCIAL INC., A
  MARYLAND CORPORATION, as the Borrower

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Geoffrey M. Dugan

  
	
   

  	
  Name:

  	
  Geoffrey M.
  Dugan

  
	
   

  	
  Title:

  	
  Secretary

  



 


2011 Second
Priority Credit Agreement


 

















 


	
   

  	
  JPMORGAN CHASE BANK, N.A., as
  the Administrative Agent and a Bank

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Charles Hoagland

  
	
   

  	
  Name:

  	
  Charles
  Hoagland

  
	
   

  	
  Title:

  	
  Vice
  President

  



 


2011 Second
Priority Credit Agreement


 

















 


	
   

  	
  BANK OF AMERICA, N.A., as
  Syndication Agent and a Bank

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Michael W. Edwards

  
	
   

  	
  Name:

  	
  Michael W.
  Edwards

  
	
   

  	
  Title:

  	
  Senior Vice
  President

  



 


2011 Second
Priority Credit Agreement


 

















 


	
   

  	
  CITICORP NORTH AMERICA, INC., as
  Syndication Agent and a Bank

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  David Bouton

  
	
   

  	
  Name:

  	
  David Bouton

  
	
   

  	
  Title:

  	
  Managing
  Director

  



 


2011 Second
Priority Credit Agreement


 
















 


	
   

  	
  BANC OF AMERICA SECURITIES LLC, as Joint
  Lead Arranger and Joint Bookrunner

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Thomas T. Shealy, Jr.

  
	
   

  	
  Name:

  	
  Thomas T. Shealy, Jr.

  
	
   

  	
  Title:

  	
  Managing Director

  



 


2011 Second Priority Credit Agreement


 

















 


	
   

  	
  J.P. MORGAN SECURITIES INC., as Joint Lead
  Arranger and Joint Bookrunner

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ R. Daniel Rouse

  
	
   

  	
  Name:

  	
  R. Daniel Rouse

  
	
   

  	
  Title:

  	
  Executive Director

  



 


2011 Second Priority Credit Agreement


 

















 


	
   

  	
  CITIGROUP GLOBAL MARKETS INC., as Joint
  Lead Arranger and Joint Bookrunner

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David Bouton

  
	
   

  	
  Name:

  	
  David Bouton

  
	
   

  	
  Title:

  	
  Managing Director

  



 


2011 Second Priority Credit Agreement


 

















 


	
   

  	
  WACHOVIA BANK, NATIONAL ASSOCIATION, as a Bank

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Evander S. Jones, Jr.

  
	
   

  	
  Name:

  	
  Evander S. Jones, Jr.

  
	
   

  	
  Title:

  	
  Director

  



 


2011 Second Priority Credit Agreement


 

















 


	
   

  	
  DEUTSCHE BANK AG, NEW YORK BRANCH, as a Bank

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ James Rolison

  
	
   

  	
  Name:

  	
  James Rolison

  
	
   

  	
  Title:

  	
  Managing Director

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ R. Chris Jones

  
	
   

  	
  Name:

  	
  R. Chris Jones

  
	
   

  	
  Title:

  	
  Director

  



 


2011 Second Priority Credit Agreement


 

















 


	
   

  	
  MORGAN STANLEY SENIOR FUNDING, INC., as a Bank

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Stephen B. King

  
	
   

  	
  Name:

  	
  Stephen B. King

  
	
   

  	
  Title:

  	
  Vice President

  



 


2011 Second Priority Credit Agreement


 
















 


	
   

  	
  BARCLAYS BANK PLC, as a Bank

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Mark Manski

  
	
   

  	
  Name:

  	
  Mark Manski

  
	
   

  	
  Title:

  	
  Managing Director

  



 


2011 Second Priority Credit Agreement


 

















 


	
   

  	
  THE ROYAL BANK OF SCOTLAND PLC, as a Bank

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Michael Fabiano

  
	
   

  	
  Name:

  	
  Michael Fabiano

  
	
   

  	
  Title:

  	
  Senior Vice President

  



 


2011 Second Priority Credit Agreement


 

















 


	
   

  	
  NATIONAL AUSTRALIA BANK LTD.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Michael Pryce

  
	
   

  	
  Name:

  	
  Michael Pryce

  
	
   

  	
  Title:

  	
  Director

  



 


2011 Second Priority Credit Agreement


 

















 


	
   

  	
  ROYAL BANK OF CANADA, as a Bank

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Dan LePage

  
	
   

  	
  Name:

  	
  Dan LePage

  
	
   

  	
  Title:

  	
  Authorized Signatory

  



 


2011 Second Priority Credit Agreement


 

















 


	
   

  	
  THE BANK OF NOVA SCOTIA, as a Bank

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ George Sherman

  
	
   

  	
  Name:

  	
  George Sherman

  
	
   

  	
  Title:

  	
  Director

  



 


2011 Second Priority Credit Agreement


 

















 


	
   

  	
  SCOTIABANC INC., as a Bank

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J.F. Todd

  
	
   

  	
  Name:

  	
  J.F. Todd

  
	
   

  	
  Title:

  	
  Managing Director

  



 


2011 Second Priority Credit Agreement


 

















 


	
   

  	
  FORTIS BANK SA/NV, NEW YORK BRANCH, as a Bank

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Barry Chung

  
	
   

  	
  Name:

  	
  Barry Chung

  
	
   

  	
  Title:

  	
  Director

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jack Au

  
	
   

  	
  Name:

  	
  Jack Au

  
	
   

  	
  Title:

  	
  Director

  



 


2011 Second Priority Credit Agreement


 

















 


	
   

  	
  HSBC BANK USA, NATIONAL ASSOCIATION, as a Bank

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Thomas L. Nolan

  
	
   

  	
  Name:

  	
  Thomas L. Nolan

  
	
   

  	
  Title:

  	
  Vice President

  



 


2011 Second Priority Credit Agreement


 

















 


	
   

  	
  EMIGRANT REALTY FINANCE, LLC. a Delaware
  limited liability company

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Michael Broido

  
	
   

  	
  Name:

  	
  Michael Broido

  
	
   

  	
  Title:

  	
  Managing Director

  



 


2011 Second Priority Credit Agreement


 

















 


	
   

  	
  WESTLB AG, NEW YORK BRANCH, as a Bank

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Christian Ruehmer

  
	
   

  	
  Name:

  	
  Christian Ruehmer

  
	
   

  	
  Title:

  	
  Managing Director

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Sharon Wang

  
	
   

  	
  Name:

  	
  Sharon Wang

  
	
   

  	
  Title:

  	
  Associate Director

  



 


2011 Second Priority Credit Agreement


 

















 


	
   

  	
  MEGA INTERNATIONAL COMMERCIAL BANK CO., LTD.
  NEW YORK BRANCH, as a Bank

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Tsang – Pei Hsu

  
	
   

  	
  Name:

  	
  Tsang – Pei Hsu

  
	
   

  	
  Title:

  	
  VP & DGM

  



 


2011 Second Priority Credit Agreement


 

















 


	
   

  	
  BANK OF CHINA, NEW YORK BRANCH, as a Bank

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Xiaojing Li

  
	
   

  	
  Name:

  	
  Xiaojing Li

  
	
   

  	
  Title:

  	
  General Manager

  



 


2011 Second Priority Credit Agreement


 
















 


	
   

  	
  PEOPLE’S UNITED BANK, as a Bank

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Maurice E. Fry

  
	
   

  	
  Name:

  	
  Maurice Fry

  
	
   

  	
  Title:

  	
  Vice president

  



 


2011 Second Priority Credit Agreement


 

















 


	
   

  	
  THE BANK OF TOKYO - MITSUBISHI UFJ, LTD, as a Bank

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ David Noda

  
	
   

  	
  Name:

  	
  David Noda

  
	
   

  	
  Title:

  	
  VP & Manager

  



 


2011 Second Priority Credit Agreement


 

















 


	
   

  	
  E.SUN COMMERCIAL BANK, LTD., LOS ANGELES BRANCH as a Bank

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Benjamin Lin

  
	
   

  	
  Name:

  	
  Benjamin Lin

  
	
   

  	
  Title:

  	
  EVP & GM

  



 


2011 Second Priority Credit Agreement


 

















 


	
   

  	
  TAIPEI FUBON COMMERCIAL BANK, NEW YORK AGENCY, as a Bank

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Michael Tan

  
	
   

  	
  Name:

  	
  Michael Tan

  
	
   

  	
  Title:

  	
  VP & General Manager

  



 


2011 Second Priority Credit Agreement


 

















 


	
   

  	
  THE CHIBA BANK, LTD., NEW YORK BRANCH, as a Bank

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Yukihito Inamura

  
	
   

  	
  Name:

  	
  Yukihito Inamura

  
	
   

  	
  Title:

  	
  General Manager

  



 


2011 Second Priority Credit Agreement


 

















 


	
   

  	
  MERRILL LYNCH BANK USA, as a Bank

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Louis Alder

  
	
   

  	
  Name:

  	
  Louis Alder

  
	
   

  	
  Title:

  	
  First Vice President

  



 


2011 Second Priority Credit Agreement