Document:

ex10_1.htm

  
    Exhibit
10.1

     

     February
5, 2009

    

    

    The
Talbots Inc.

    One
Talbots Drive

    Hingham,
MA 02043

    

    

    
      	
              Re:

            	
              Loan
      Facility Agreement

            

    

    

    Gentlemen/Ladies:

    

    We are
pleased to inform The Talbots Inc. (the "Company") that we agree, subject to the
terms and conditions set forth or referred to in this letter agreement, to
provide to the Company a loan facility as more fully described in the attached
summary of terms (the "Summary of Terms").  We are providing this loan
facility to be used by the Company and its subsidiaries to repay and retire all
outstanding indebtedness under the Term Loan Agreement, dated July 24, 2006,
among the Company, each of the lenders party thereto and Mizuho Corporate Bank
Ltd, as agent.

    

    In
addition, our obligation to provide such loan facility shall be subject to (i)
completion of satisfactory confirmatory due diligence, (ii) the negotiation,
execution and delivery of definitive documentation which shall be mutually
satisfactory to the Company and us and consistent with the Summary of Terms and
(iii) satisfaction of the other conditions set forth or referred to in the
Summary of Terms (or such definitive documentation).

    

    This
letter agreement is made solely for the benefit of parties hereto and may not be
relied upon or enforced by any other person.  This letter agreement
and all or a portion of the commitment contained herein may be assigned to one
or more of our subsidiaries.  This letter agreement may be amended or
modified only by a writing signed by the parties hereto.  This letter
agreement may be executed in one or more counterparts, all of which, taken
together, shall constitute one and the same agreement.  This letter
agreement shall be governed by and construed in accordance with the laws of the
State of New York.

    

    If the
above is acceptable, please so confirm by signing and returning a copy of this
letter agreement to the undersigned no later than 5:00 p.m., New York City time,
on February 6, 2009, whereupon this letter agreement and each counterpart hereof
will constitute a binding agreement between the Company and us.  Our
agreements contain herein and in the Summary of Terms will expire at such time
in the event we have not received such confirmation.  Thereafter, our
accepted agreements hereunder will expire on March 31, 2009.

     

     

    
      
        
          
            
              
                
                  
                    
                      	 	Very
      truly yours,	 
	 	 	 
	 	AEON
      CO., LTD.	 
	 	 	 	 
	 	 	 	 
	
                               

                            	
                              By:

                            	  
      /s/ Masaaki Toyoshima	 
	 	 	
                              Name:
      Masaaki Toyoshima

                            	 
	 	 	
                              Title:
      Vice President

                            	 
	 	 	         
      Chief Financial Officer & CEO, GMS Business	 

                    

                  

                

              

            

          

        

      

    

     

    Accepted
and agreed to this 5th

    day of
February, 2009:

    

    
      
        
          
            
              
                
                  	THE
      TALBOTS INC.	 
	 	 	 
	 	 	 
	
                          By:

                        	  
      /s/ Trudy F. Sullivan	 
	 	Name: Chief
      Executive Officer and President	 
	 	Title:
      Chief Executive Officer and President	 
	 	 	 

                

              

            

          

        

         

        Attachment:   Summary
of Terms and Conditions

      

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    The
Talbots, Inc.

     

    LOAN
FACILITY AGREEMENT

     

    

     

    These
terms are not exhaustive and provide a summary only of the principal terms and
conditions of the Loan Facility Agreement described herein (the “Facility
Agreement”).  The parties have agreed that the Facility
Agreement will be based on the Term Loan Agreement, dated as of July 16, 2008,
between The Talbots, Inc. and Aeon (U.S.A.), Inc. (the “Existing
Loan”) except (i) to the extent necessary to reflect the terms below and
(ii) such additional conditions, undertakings, representations and warranties,
events of default and other provisions as may be considered necessary or
appropriate by the Lender for a transaction of this nature and which are
reasonably agreed in final documentation between the Lender and the
Borrower.  Each party acknowledges that certain information provided
in connection with the proposed transaction is confidential.  Each
party agrees that it will not disclose such information to any other party
except to its legal counsel or tax advisors or as required for the completion of
the transaction described herein.

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                
                                                  
                                                    
                                                      
                                                        
                                                          
                                                            
                                                              
                                                                
                                                                  
                                                                    
                                                                      
                                                                        
                                                                          
                                                                            
                                                                              
                                                                                
                                                                                  
                                                                                    
                                                                                      
                                                                                        
                                                                                          
                                                                                            
                                                                                              
                                                                                                
                                                                                                  
                                                                                                    
                                                                                                      
                                                                                                        
                                                                                                          
                                                                                                            
                                                                                                              
                                                                                                                
                                                                                                                  
                                                                                                                    
                                                                                                                      
                                                                                                                        
                                                                                                                          
                                                                                                                            
                                                                                                                              
                                                                                                                                	
                                                                                                                                        Borrower:

                                                                                                                                      	
                                                                                                                                        The
      Talbots, Inc.

                                                                                                                                      
	 	 
	
                                                                                                                                        Lender:

                                                                                                                                      	
                                                                                                                                        Aeon
      Co., Ltd. or one or more subsidiaries of Aeon Co., Ltd. (the “Lender”).

                                                                                                                                      
	 	 
	
                                                                                                                                        Principal
      Amount

                                                                                                                                      	
                                                                                                                                        U.S.$200
      million.

                                                                                                                                      
	 	 
	
                                                                                                                                        Purpose:

                                                                                                                                      	
                                                                                                                                        Proceeds
      of the borrowing under the Facility Agreement (the “Loan”)
      will be used by the Borrower and its subsidiaries solely to repay all of
      the outstanding indebtedness under the Term Loan Agreement, dated July 24,
      2006 (as amended), among the Borrower, each of the lenders party thereto
      and Mizuho Corporate Bank Ltd, as agent (the “Acquisition
      Loan”).

                                                                                                                                      
	 	 
	
                                                                                                                                        Availability:

                                                                                                                                      	
                                                                                                                                        The
      full amount of the Loan must be drawn in a single drawing on the Closing
      Date.  Amounts borrowed under the Facility Agreement that are
      repaid or prepaid may not be reborrowed.

                                                                                                                                      
	 	 
	
                                                                                                                                        Repayment:

                                                                                                                                      	
                                                                                                                                        The
      entire principal amount of the Loan, less any prepaid amounts, shall be
      repaid in U.S. Dollars in full on the Maturity Date (as defined
      below).

                                                                                                                                      
	 	 
	
                                                                                                                                        Voluntary
      Prepayments:

                                                                                                                                      	
                                                                                                                                        The
      Loan may be prepaid, in whole or in part, at par plus accrued and unpaid
      interest and any break funding loss incurred upon not less than three
      business days’ in Japan prior written notice, at the option of the
      Borrower at any
time.

                                                                                                                                      

                                                                                                                              

                                                                                                                            

                                                                                                                          

                                                                                                                        

                                                                                                                      

                                                                                                                    

                                                                                                                  

                                                                                                                

                                                                                                              

                                                                                                            

                                                                                                          

                                                                                                        

                                                                                                      

                                                                                                    

                                                                                                  

                                                                                                

                                                                                              

                                                                                            

                                                                                          

                                                                                        

                                                                                      

                                                                                    

                                                                                  

                                                                                

                                                                              

                                                                            

                                                                          

                                                                        

                                                                      

                                                                    

                                                                  

                                                                

                                                              

                                                            

                                                          

                                                        

                                                      

                                                    

                                                  

                                                

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                
                                                  
                                                    
                                                      
                                                        	
                                                                Mandatory
      Prepayments:

                                                              	
                                                                The
      Loan shall be prepaid with (a) 50% of Excess Cash Flow (to be defined),
      (b) 75% of the net cash proceeds of all asset sales or other dispositions
      of property by the Borrower and its subsidiaries (including 75% of the net
      proceeds from the sale of stock of any subsidiary of the Borrower and
      insurance and condemnation proceeds, provided, however, that in case of
      the sale of J.Jill, it should be 100% of the net proceeds from the sale of
      J. Jill), (c) 100% of the net cash proceeds of issuances, offerings or
      placements of debt obligations of the Borrower and its subsidiaries
      (subject to exceptions to be agreed upon) and (d) 50% of the net cash
      proceeds of issuances of equity securities of the Borrower and its
      subsidiaries (subject to exceptions to be agreed upon).

                                                              
	 	 
	
                                                                Interest
      Rate:

                                                              	
                                                                LIBOR
      plus 6.00%.  Interest on the Loan will be payable on the last
      day of each six month interest period in arrears.

                                                                 

                                                                “LIBOR”
      means the six month London interbank offer rate expressed as a percentage
      rate per annum which appears on the Telerate Page 3750 as of 11:00 a.m.,
      London time, on the day that is two business days prior to the proposed
      funding date.

                                                                 

                                                                All
      computations of fees and interest shall be made on the basis of a 365-day
      year and actual days elapsed.

                                                              
	 	 
	
                                                                Closing
      Date:

                                                              	
                                                                On
      the earlier to occur of (i) February 27, 2009 and (ii) three business days
      in Japan after satisfaction (or waiver) of all conditions precedent to
      borrowing.

                                                              
	 	 
	
                                                                Maturity
      Date:

                                                              	
                                                                The
      Loan will mature six-months after the Closing Date; provided, that, the Borrower
      shall have the option to extend the maturity for additional six-month
      periods, up to the third anniversary of the Closing Date (such date, as
      extended, the “Maturity
      Date”).

                                                              
	 	 
	
                                                                Security;
      Ranking:

                                                              	
                                                                The
      Loan will be a unsecured general obligation of the Borrower ranking pari passu with all
      other unsecured and unsubordinated indebtedness of the
      Borrower.

                                                                 

                                                                Neither
      the Borrower nor any of its subsidiaries may create, assume or suffer to
      exist any lien securing indebtedness incurred after the Closing Date
      without granting a pari
      passu lien to the Lender to secure the Loan made under the Facility
      Agreement.

                                                              
	 	 
	
                                                                Guarantees:

                                                              	
                                                                The
      obligations under the Facility Agreement will be fully and unconditionally
      guaranteed on a senior, joint and several basis (the “Guarantees”),
      by all of the existing and future direct and indirect subsidiaries of the
      Borrower (collectively, the “Guarantors”).

                                                                 

                                                                Each
      Guarantee will be the unsecured general obligation of the applicable
      Guarantor, ranking pari
      passu with all other unsecured and unsubordinated indebtedness of
      such
Guarantor.

                                                              

                                                      

                                                    

                                                  

                                                

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                
                                                  
                                                    
                                                      
                                                        
                                                          
                                                            
                                                              
                                                                
                                                                  
                                                                    
                                                                      
                                                                        
                                                                          
                                                                            
                                                                              
                                                                                
                                                                                  
                                                                                    
                                                                                      
                                                                                        
                                                                                          
                                                                                            
                                                                                              
                                                                                                	
                                                                                                        Default
      Rate:

                                                                                                      	
                                                                                                        Upon
      the occurrence and during the continuance of a de-fault, interest will
      accrue on any principal or other amount payable under the Loan at a rate
      of 15.00% per annum in excess of the applicable interest rate and will be
      payable on demand.

                                                                                                      
	 	 
	
                                                                                                        Conditions
      Precedent to 

                                                                                                        Borrowing:

                                                                                                      	
                                                                                                        Substantially
      the same as provided under the Existing Loan and usual for facilities of
      this type.

                                                                                                      
	 	 
	
                                                                                                        Representations
      and 

                                                                                                        Warranties:

                                                                                                      	
                                                                                                        The
      Facility Agreement and the other definitive documentation relating to the
      Loan (the “Loan
      Documents”) will contain representations and warranties relating to
      the Borrower and its subsidiaries that are usual and customary for
      transactions of this nature or required by the Lender for this transaction
      in particular.

                                                                                                      
	 	 
	
                                                                                                        Covenants:

                                                                                                      	
                                                                                                        The
      Loan Documents will contain restrictive covenants relating to the Borrower
      and its subsidiaries that are usual and customary for transactions of this
      nature, or required by the Lender for this transaction in particular,
      including:

                                                                                                         

                                                                                                        Financial
      Covenants: None.

                                                                                                         

                                                                                                        Affirmative
      Covenants: Payment of obligations, maintenance of existence,
      compliance with laws, maintenance of property, insurance, inspection of
      property, books and records, notices, use of proceeds, further
      assurances.

                                                                                                         

                                                                                                        Negative
      Covenants: Written consent of the Lender (in its sole discretion)
      shall be required prior to incurrences of indebtedness, liens, fundamental
      changes (including mergers, consolidations, etc.), dispositions of
      property (including sales of stock of subsidiaries), restricted payments,
      investments, transactions with affiliates and other related parties, sale
      leaseback transactions, swap agreements, changes in fiscal periods,
      negative pledge clauses, clauses restricting subsidiary distributions and
      lines of business.

                                                                                                      
	 	 	 
	
                                                                                                        Reports:

                                                                                                      	The
      Lender shall receive the following reports:
	 	 	 
	
                                                                                                         

                                                                                                      	
                                                                                                        ·

                                                                                                      	
                                                                                                        audited
      annual financial statements of the Borrower within 120 days after the end
      of each fiscal year of the Borrower;

                                                                                                      
	 	 	 
	 	
                                                                                                        ·

                                                                                                      	unaudited
      quarterly financial statements of the Borrower within 60 days after the
      end of each fiscal quarter of the Borrower; and
	 	 	 
	 	
                                                                                                        ·

                                                                                                      	
                                                                                                        Such
      other information and reports as reasonably requested by the Lender from
      time to
time.

                                                                                                      

                                                                                              

                                                                                            

                                                                                          

                                                                                        

                                                                                      

                                                                                    

                                                                                  

                                                                                

                                                                              

                                                                            

                                                                          

                                                                        

                                                                      

                                                                    

                                                                  

                                                                

                                                              

                                                            

                                                          

                                                        

                                                      

                                                    

                                                  

                                                

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        
          
            	
                    Events
      of Default:

                  	
                    Customary
      for the type of transactions proposed and others to be reasonably
      specified by the Lender relating to the Borrower and its subsidiaries
      (subject, where appropriate, to thresholds and grace periods to be agreed
      upon), including nonpayment of principal, interest or other amounts,
      violation of covenants, incorrectness of representations and warranties in
      any material respect, cross default and cross acceleration, bankruptcy,
      material judgments or material adverse change.

                     

                    In
      case an event of default shall occur and be continuing, the Lender, by
      notice in writing to the Borrower, may declare the principal of, and all
      accrued interest on, the Loan to be due and payable
      immediately.  If a bankruptcy event of the Borrower occurs, the
      principal amount of and accrued interest on the Loan will be immediately
      due and payable without any notice, declaration or other act on the part
      of the Lender.

                  
	 	 
	
                    Cost
      and Yield Protection:

                  	
                    Usual
      for facilities and transactions of this type, including customary
      increased costs and tax gross-up provisions.

                     

                    In
      addition, upon any voluntary or mandatory prepayment of the Loan, Borrower
      shall reimburse Lender for costs associated with early termination of any
      currency hedging arrangements relating to the Loan.

                  
	 	 
	
                    Expenses
      and 

                    Indemnification:

                  	
                    The
      Loan Documents will contain standard indemnification provisions of the
      Lender, its affiliates, officers, directors and employees that are usual
      and customary for transactions of this nature or required by the Lender
      for this transaction in particular.

                     

                    In
      addition, all out-of-pocket expenses (including, legal fees) of the Lender
      in connection with the making of the Loan and for the exercise and
      enforcement thereof will be paid by the Borrower upon demand from the
      Lender.

                  
	 	 
	
                    Borrower
      Account:

                  	
                    The
      Borrower shall open an account at a bank designated by the
      Lender.

                  
	 	 
	
                    Language:

                  	
                    English.

                  
	 	 
	
                    Governing
      Law:

                  	
                    [TBD].exh-amend.htm

  
    Exhibit 10.1

     

    First
Amendment To Amended and Restated Revolving

    Credit
and Term Loan Agreement

    

    This
FIRST AMENDMENT TO AMENDED AND RESTATED REVOLVING CREDIT AND TERM LOAN AGREEMENT
(this “Amendment”) is entered into as of January 30, 2009, by and
among:  Centerline Holding Company and Centerline Capital Group Inc.
(collectively, the “Borrowers”); those Persons listed as Guarantors on Schedule 1 hereto
(each, a “Guarantor,” and, collectively, the “Guarantors”); and, pursuant to
Section 23.1 of
the Loan Agreement (as defined below), those Lenders constituting the Required
Lenders, each as set forth on a counterpart signature page hereto, substantially
in the form of Schedule 2 hereto
(the “Required Lenders”).

     

    RECITALS

     

    Reference
is made to the following facts that constitute the background of this
Amendment:

     

    A.           The
parties hereto, among others, have entered into that certain Amended and
Restated Revolving Credit and Term Loan Agreement, dated as of December 19, 2008
(as amended, restated, supplemented or otherwise modified from time to time, the
“Loan Agreement”).  Capitalized terms used herein and not otherwise
defined herein shall have the same meanings herein as ascribed to them in the
Loan Agreement;

     

    B.           The
Borrowers have notified the Administrative Agent that (i) Centerline Investor LP
intends to sell certain LIHTC Investments to an investor generating proceeds in
excess of $4,658,740, but that some or all of such sales will not close as
originally planned prior to January 30, 2009 as contemplated by Section 10.5.2
of the Loan Agreement, (ii) the existing LIHTC Investments may not generate
$29,658,740 in proceeds as originally projected, and (iii) Centerline Investor
LP intends to make new LIHTC Investments totaling [$1,433,660] on or before
January 30, 2009;

     

    C.           As
a result of these developments, the Borrowers, the Guarantors, the
Administrative Agent and the Required Lenders agree that Section 10.5.2 of the
Loan Agreement should be amended on the terms and conditions set forth in this
Amendment.

     

    NOW,
THEREFORE, in consideration of the foregoing recitals and of the
representations, warranties, covenants and conditions set forth herein and in
the Loan Agreement, and for other valuable consideration the receipt and
adequacy of which is hereby acknowledged, the parties hereto agree as
follows:

     

    Section
1.      Amendments

     

    (a)           Amendment to Section
1.1.2.  Section 1.1.2 of the
Loan Agreement is hereby amended by inserting the following definition in the
proper alphabetical sequence:

     

    “’LIHTC Advanced
Amount’ means the total amount borrowed hereunder with respect to a
particular LIHTC Investment.”

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (b)           Amendment to Section
10.5.2.  Section 10.5.2 of the
Loan Agreement is hereby deleted in its entirety and replaced with the
following:

     

    “10.5.2        Further
Exception to Limitations on LIHTC Investments.  Notwithstanding
any other provision of this Credit Agreement, the parties hereto (a) acknowledge
that (1) as of the Closing Date the aggregate amount invested by Centerline
Investor LP in LIHTC Investments as set forth on Schedule 8.23 and the project
known as San Remo Hesperia II is $29,658,740.00 (such investments collectively
referred to as the “Outstanding LIHTC Investments”), and (2) notwithstanding
Section 10.19 hereof, on or prior to January 30, 2009, the Borrowers may cause
Centerline Investor LP to make additional LIHTC Investments from available cash
in an amount not greater than $1,433,660.00 in the projects known as Desert
Palms and Mountain View (collectively, the “V Deals”); (b) agree that any
proceeds from the sale of any portion of the V Deals up to the LIHTC Advanced
Amounts with respect to the V Deals shall be applied to reduce the outstanding
principal balance of the Revolving Portion in order to create additional
availability under the Revolving Portion, and any such proceeds in excess of the
LIHTC Advanced Amounts with respect to the V Deals may be used by CHC or its
Subsidiaries for Working Capital Purposes; (c) agree that from the Closing Date
through the close of business on June 30, 2009, the proceeds from the sale of
each Outstanding LIHTC Investment, (i) up to the LIHTC Advanced Amount with
respect to such Outstanding LIHTC Investment, and in the aggregate with respect
to all of the Outstanding LIHTC Investments not more than $25,000,000, shall be
applied to reduce the outstanding principal balance of the Revolving Portion in
order to create additional availability under the Revolving Portion, and (ii) to
the extent such proceeds with respect to such Outstanding LIHTC Investment
exceed the LIHTC Advanced Amount with respect to such Outstanding LIHTC
Investment, or such aggregate proceeds with respect to all Outstanding LIHTC
Investments exceed $25,000,000, any such excess proceeds may be used by
Centerline Investor LP in order to make additional LIHTC Investments or by CHC
or its Subsidiaries for Working Capital Purposes; (d) agree that after the close
of business on June 30, 2009, (i) proceeds from any sale of any portion of the
Outstanding LIHTC Investments, but not in excess of the LIHTC Advanced Amount
with respect to any individual Outstanding LIHTC Investment, of up to an amount
equal to $25,000,000.00 minus proceeds previously applied to reduce the
outstanding principal balance of the Revolving Portion pursuant to subsection
(c) (the “Post June 30 Limit”) shall be applied to reduce the outstanding
principal balance of the Revolving Portion in order to create additional
availability under the Revolving Portion, (ii) proceeds in excess of the LIHTC
Advanced Amount with respect to any individual Outstanding LIHTC Investment may
be used by Centerline Investor LP in order to make additional LIHTC Investments
or by CHC or its Subsidiaries for Working Capital Purposes, and (iii) any
remaining proceeds shall be applied to reduce the outstanding principal balance
of the Termed Out Revolver and the Revolving Credit Limit; (e) agree that
proceeds from the sale of LIHTC Investments not included among the Outstanding
LIHTC Investments or the V Deals, but not in excess of the LIHTC Advanced Amount
with respect to any individual LIHTC Investment, shall be applied to reduce the
outstanding principal balance of the Revolving Portion in order to create
additional availability under the Revolving Portion, and any additional proceeds
may be used by CHC or its Subsidiaries for Working Capital Purposes; (f) agree
that to the extent proceeds to be applied in this section to reduce the
outstanding principal balance of the Revolving Portion exceed such balance, the
excess shall be available to the Borrowers for Working Capital Purposes; and (g)
agree, for the avoidance of doubt, that the Agent will release its liens on
LIHTC Investments in accordance with the Security Documents.”

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (c)           Amendment to Section
10.19.  Section 10.19 of the
Loan Agreement is hereby amended by adding the following after the last sentence
of such section: “All investments by CHC and its Subsidiaries in properties
providing low income housing tax credits shall be made solely by Centerline
Investor LP solely with funds borrowed hereunder that are available to be
borrowed as part of the Revolving Portion.”

     

    Section
2.        Representations and
Warranties.  The Borrowers and Guarantors, jointly and
severally, represent and warrant to the Lenders, the Issuing Bank and the
Administrative Agent as of the date of this Amendment that: (a) no Default is in
existence on the date hereof, or will result from the execution and delivery of
this Amendment or the consummation of any transactions contemplated hereby; (b)
each of the representations and warranties of the Borrowers and the Guarantors
in the Loan Agreement and the other Loan Documents is true and correct in all
material respects on the effective date of this Amendment (except for
representations and warranties limited as to time or with respect to a specific
event, which representations and warranties shall continue to be limited to such
time or event; and (c) this Amendment and the Loan Agreement are legal, valid
and binding agreements of the Borrowers and the Guarantors and are enforceable
against them in accordance with their terms.

     

    Section
3.         Ratification.  Except
as hereby amended, the Loan Agreement, all other Loan Documents and each
provision thereof are hereby ratified and confirmed in every respect and shall
continue in full force and effect, and this Amendment shall not be, and shall
not be deemed to be, a waiver of any Default or of any covenant, term or
provision of the Loan Agreement or the other Loan Documents.  In
furtherance of the foregoing ratification, by executing this Amendment in the
spaces provided below, each of the Guarantors, on a joint and several basis,
hereby absolutely and unconditionally (a) reaffirms its obligations under the
Guaranties, and (b) absolutely and unconditionally consents to (i) the execution
and delivery by the Borrowers of this Amendment, (ii) the continued
implementation and consummation of arrangements and transactions contemplated by
the Loan Agreement (including, without limitation, as amended or waived hereby)
and the other Loan Documents, and (iii) the performance and observance by each
Borrower and each Guarantor of all of its respective agreements, covenants,
duties and obligations under the Loan Agreement (including, without limitation,
as amended hereby) and the other Loan Documents.

     

    Section
4.          Conditions
Precedent.  The agreements set forth in this Amendment are
conditional and this Amendment shall not be effective until receipt by the
Administrative Agent of a fully-executed counterpart of this
Amendment.

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Section
5.         Counterparts.  This
Amendment may be executed and delivered in any number of counterparts with the
same effect as if the signatures on each counterpart were upon the same
instrument.  Any counterpart delivered by facsimile or by other
electronic method of transmission shall be deemed an original signature
thereto.

     

    Section
6.          Amendment as Loan
Document.  Each party hereto agrees and acknowledges that this
Amendment constitutes a “Loan Document” under and as defined in the Loan
Agreement.

     

    Section
7.          GOVERNING
LAW.  THIS AMENDMENT SHALL BE DEEMED TO CONSTITUTE A CONTRACT
MADE UNDER THE LAWS OF THE STATE OF NEW YORK, INCLUDING ARTICLE 5 OF THE UCC,
AND SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF
THE STATE OF NEW YORK (INCLUDING SECTION 5-1401 AND 5-1402 OF THE GENERAL
OBLIGATIONS LAW, BUT OTHERWISE WITHOUT REGARD TO ITS CONFLICTS OF LAW
RULES).

     

    Section
8.          Successors and
Assigns.  This Amendment shall be binding upon each of the
Borrowers, the Guarantors, the Lenders, the Issuing Bank, the Administrative
Agent, the Agents and their respective successors and assigns, and shall inure
to the benefit of each such Person and their permitted successors and
assigns.

     

    Section
9.           Headings.  Section
headings in this Amendment are included herein for convenience of reference only
and shall not constitute a part of this Amendment for any other
purpose.

     

    Section
10.         Expenses.  Each
Borrower jointly and severally agrees to promptly reimburse the Administrative
Agent for all expenses, including, without limitation, reasonable fees and
expenses of outside legal counsel, such Person has heretofore or hereafter
incurred or incurs in connection with the preparation, negotiation and execution
of this Amendment and all other instruments, documents and agreements executed
and delivered in connection with this Amendment.

     

    Section
11.        Integration.  This
Amendment contains the entire understanding of the parties hereto and with any
other Lenders and parties to the Loan Agreement with regard to the subject
matter contained herein.  This Amendment supersedes all prior or
contemporaneous negotiations, promises, covenants, agreements and
representations of every nature whatsoever with respect to the matters referred
to in this Amendment, all of which have become merged and finally integrated
into this Amendment.  Each of the parties hereto understands that in
the event of any subsequent litigation, controversy or dispute concerning any of
the terms, conditions or provisions of this Amendment, no party shall be
entitled to offer or introduce into evidence any oral promises or oral
agreements between the parties relating to the subject matter of this Amendment
not included or referred to herein and not reflected by a writing included or
referred to herein.

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    Section
12.        Jury Trial
Waiver.  THE BORROWERS, GUARANTORS, ADMINISTRATIVE AGENT AND
LENDERS BY ACCEPTANCE OF THIS AMENDMENT MUTUALLY HEREBY KNOWINGLY, VOLUNTARILY
AND INTENTIONALLY WAIVE THE RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION BASED HEREON, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS FIRST
AMENDMENT, THE LOAN AGREEMENT, OR ANY OTHER LOAN DOCUMENTS CONTEMPLATED TO BE
EXECUTED IN CONNECTION HEREWITH, OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS,
STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY, INCLUDING,
WITHOUT LIMITATION, ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS OR
ACTIONS OF ANY AGENT OR ANY LENDER RELATING TO THE ADMINISTRATION OF THE LOAN OR
ENFORCEMENT OF THE LOAN DOCUMENTS, ARISING OUT OF TORT, STRICT LIABILITY,
CONTRACT OR ANY OTHER LAW, AND AGREE THAT NO PARTY WILL SEEK TO CONSOLIDATE ANY
SUCH ACTION WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT BE OR HAS NOT
BEEN WAIVED.

     

    

     

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

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    IN
WITNESS WHEREOF, the parties have caused this Amendment to be duly executed by
their duly authorized officers or representatives, all as of the date first
above written.

    

    

    
      
        	
                BORROWERS:

              	
                CENTERLINE
      HOLDING COMPANY

              
	 
      	 
      	 
      
	 
      	
                By:

              	
                /s/ Marc D. Schnitzer

              
	 
      	 
      	
                Name:

              	
                Marc
      D. Schnitzer

              
	 
      	 
      	
                Title:

              	
                President
      & Chief Executive Officer

              
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                CENTERLINE
      CAPITAL GROUP INC.

              
	 
      	 
      	 
      
	 
      	
                By:

              	
                /s/ Marc D. Schnitzer

              
	 
      	 
      	
                Name:

              	
                Marc
      D. Schnitzer

              
	 
      	 
      	
                Title:

              	
                Chief
      Executive Officer

              
	 
      	 
      	 
      

      

    

    

     

    (Signatures
continued on next page)

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    
      
        	
                GUARANTORS:

              	
                CENTERLINE
      CAPITAL COMPANY LLC

              
	 
      	 
      	 
      
	 
      	
                By:

              	
                /s/ Marc D. Schnitzer

              
	 
      	 
      	
                Name:

              	
                Marc
      D. Schnitzer

              
	 
      	 
      	
                Title:

              	
                President

              
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                CENTERLINE
      AFFORDABLE HOUSING ADVISORS LLC

              
	 
      	 
      	 
      
	 
      	
                By:

              	
                /s/ Marc D. Schnitzer

              
	 
      	 
      	
                Name:

              	
                Marc
      D. Schnitzer

              
	 
      	 
      	
                Title:

              	
                Chief
      Executive Officer

              
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                CENTERLINE/AC
      INVESTORS LLC

              
	 
      	 
      	 
      
	 
      	
                By:

              	
                /s/ Marc D. Schnitzer

              
	 
      	 
      	
                Name:

              	
                Marc
      D. Schnitzer

              
	 
      	 
      	
                Title:

              	
                Chief
      Executive Officer

              
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                CENTERLINE
      HOLDING TRUST

              
	 
      	 
      	 
      
	 
      	
                By:

              	
                /s/ Marc D. Schnitzer

              
	 
      	 
      	
                Name:

              	
                Marc
      D. Schnitzer

              
	 
      	 
      	
                Title:

              	
                Chief
      Executive Officer

              
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                CENTERLINE
      INVESTORS I LLC

              
	 
      	 
      	 
      
	 
      	
                By:

              	
                /s/ Marc D. Schnitzer

              
	 
      	 
      	
                Name:

              	
                Marc
      D. Schnitzer

              
	 
      	 
      	
                Title:

              	
                Chief
      Executive Officer

              
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                CENTERLINE
      MANAGER LLC

              
	 
      	 
      	 
      
	 
      	
                By:

              	
                /s/ Marc D. Schnitzer

              
	 
      	 
      	
                Name:

              	
                Marc
      D. Schnitzer

              
	 
      	 
      	
                Title:

              	
                Chief
      Executive Officer

              
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                CENTERLINE
      GUARANTEED MANAGER LLC

              
	 
      	 
      	 
      
	 
      	
                By:

              	
                /s/ Marc D. Schnitzer

              
	 
      	 
      	
                Name:

              	
                Marc
      D. Schnitzer

              
	 
      	 
      	
                Title:

              	
                Executive
      Vice President

              

      

    

    

     

    (Signatures
continued on next page)

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    
      
        	
                GUARANTORS
      (CONT.):

              	
                CENTERLINE
      REIT INC.

              
	 
      	 
      	 
      
	 
      	
                By:

              	
                /s/ Bryan Carr

              
	 
      	 
      	
                Name:

              	
                Bryan
      Carr

              
	 
      	 
      	
                Title:

              	
                Chief
      Financial Officer

              
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                CENTERLINE
      SERVICING INC.

              
	 
      	 
      	 
      
	 
      	
                By:

              	
                /s/ Bryan Carr

              
	 
      	 
      	
                Name:

              	
                Bryan
      Carr

              
	 
      	 
      	
                Title:

              	
                Chief
      Financial Officer

              
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                CENTERLINE
      FINANCE CORPORATION

              
	 
      	 
      	 
      
	 
      	
                By:

              	
                /s/ Bryan Carr

              
	 
      	 
      	
                Name:

              	
                Bryan
      Carr

              
	 
      	 
      	
                Title:

              	
                Treasurer

              
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                CENTERLINE
      INVESTOR LP LLC

              
	 
      	 
      	 
      
	 
      	
                By:

              	
                /s/ Andrew J. Weil

              
	 
      	 
      	
                Name:

              	
                Andrew
      J. Weil

              
	 
      	 
      	
                Title:

              	
                Chief
      Executive Officer

              
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                CENTERLINE
      INVESTOR LP II LLC

              
	 
      	 
      	 
      
	 
      	
                By:

              	
                /s/ Andrew J. Weil

              
	 
      	 
      	
                Name:

              	
                Andrew
      J. Weil

              
	 
      	 
      	
                Title:

              	
                Chief
      Executive Officer

              
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                CENTERLINE
      CREDIT MANAGEMENT LLC

              
	 
      	 
      	 
      
	 
      	
                By:

              	
                /s/ Nicholas A. C.
  Mumford

              
	 
      	 
      	
                Name:

              	
                Nicholas
      A. C. Mumford

              
	 
      	 
      	
                Title:

              	
                Executive
      Managing Director

              
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	
                CM
      INVESTOR LLC

              
	 
      	 
      	 
      
	 
      	
                By:

              	
                /s/ Marc D. Schnitzer

              
	 
      	 
      	
                Name:

              	
                Marc
      D. Schnitzer

              
	 
      	 
      	
                Title:

              	
                Chief
      Executive Officer

              

      

    

    

     

    (Signatures
continued on next page)

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Schedule
1

    

    Guarantors

     

    1.           Centerline
Investor LP,

    2.           Centerline
Investor LP II,

    3.           CCC,

    4.           CAHA,

    5.           Centerline/AC,

    6.           Holding
Trust,

    7.           Centerline
Investors,

    8.           Centerline
REIT Inc.,

    9.           Centerline
Servicing Inc.,

    10.         Centerline
Finance Corporation,

    11.         Credit
Management,

    12.         CM
Investor LLC,

    13.         Centerline
Manager LLC

    14.         Centerline
Guaranteed Manager LLC

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Schedule
2

    

    Form of Signature Page for
Lenders included in Required Lenders for purposes of approving FIRST AMENDMENT
TO AMENDED AND RESTATED REVOLVING CREDIT AND TERM LOAN
AGREEMENT:

    

    The
undersigned hereby evidences its agreement to the terms of the FIRST AMENDMENT
TO AMENDED AND RESTATED REVOLVING CREDIT AND TERM LOAN AGREEMENT, and the
consummation of the transactions contemplated thereby, amending that certain
Amended and Restated Revolving Credit and Term Loan Agreement dated as of
December 19, 2008 by and among Centerline Holding Company and Centerline Capital
Group Inc. as the Borrowers, the Guarantors described therein, the Lenders
described therein, and Bank of America, N.A., as Administrative Agent and
Issuing Bank, as such agreement is amended, restated, supplemented or otherwise
modified from time to time.

    

    
      
        	
                BANK
      OF AMERICA, N.A.

              
	 
      
	
                By:

              	
                /s/ John F. Simon

              
	
                Name:

              	
                John
      F. Simon

              
	
                Title:

              	
                Senior
      Vice President

              

      

    

    

    

    Representing 39.503604519% of all Term
Loans outstanding, all Revolving Exposure, unused Revolving Loan Commitments and
unused Term Loan Commitments 

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Schedule
2

    

    Form of Signature Page for
Lenders included in Required Lenders for purposes of approving FIRST AMENDMENT
TO AMENDED AND RESTATED REVOLVING CREDIT AND TERM LOAN
AGREEMENT:

    

    The
undersigned hereby evidences its agreement to the terms of the FIRST AMENDMENT
TO AMENDED AND RESTATED REVOLVING CREDIT AND TERM LOAN AGREEMENT, and the
consummation of the transactions contemplated thereby, amending that certain
Amended and Restated Revolving Credit and Term Loan Agreement dated as of
December 19, 2008 by and among Centerline Holding Company and Centerline Capital
Group Inc. as the Borrowers, the Guarantors described therein, the Lenders
described therein, and Bank of America, N.A., as Administrative Agent and
Issuing Bank, as such agreement is amended, restated, supplemented or otherwise
modified from time to time.

    

    
      
        	
                MLBUSA
      Community Development Corp.

              
	 
      
	
                By:

              	
                /s/ Amy Brusiloff

              
	
                Name:

              	
                Amy
      Brusiloff

              
	
                Title:

              	
                Director

              

      

    

    

    

    Representing _____% of all Term Loans outstanding, all
Revolving Exposure, unused Revolving Loan Commitments and unused Term Loan
Commitments 

    

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    

    Schedule
2

    

    Form of Signature Page for
Lenders included in Required Lenders for purposes of approving FIRST AMENDMENT
TO AMENDED AND RESTATED REVOLVING CREDIT AND TERM LOAN
AGREEMENT:

    

    The
undersigned hereby evidences its agreement to the terms of the FIRST AMENDMENT
TO AMENDED AND RESTATED REVOLVING CREDIT AND TERM LOAN AGREEMENT, and the
consummation of the transactions contemplated thereby, amending that certain
Amended and Restated Revolving Credit and Term Loan Agreement dated as of
December 19, 2008 by and among Centerline Holding Company and Centerline Capital
Group Inc. as the Borrowers, the Guarantors described therein, the Lenders
described therein, and Bank of America, N.A., as Administrative Agent and
Issuing Bank, as such agreement is amended, restated, supplemented or otherwise
modified from time to time.

    

    
      
        	
                MORTGAN
      STANLEY BANK, N.A.

              
	 
      
	
                By:

              	
                /s/ Melissa James

              
	
                Name:

              	
                Melissa
      James

              
	
                Title:

              	
                Authorized
      Signatory

              

      

    

    

    

    Representing 16.33% of all Term Loans
outstanding, all Revolving Exposure, unused Revolving Loan Commitments and
unused Term Loan Commitments 

    

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Schedule
2

    

    Form of Signature Page for
Lenders included in Required Lenders for purposes of approving FIRST AMENDMENT
TO AMENDED AND RESTATED REVOLVING CREDIT AND TERM LOAN
AGREEMENT:

    

    The
undersigned hereby evidences its agreement to the terms of the FIRST AMENDMENT
TO AMENDED AND RESTATED REVOLVING CREDIT AND TERM LOAN AGREEMENT, and the
consummation of the transactions contemplated thereby, amending that certain
Amended and Restated Revolving Credit and Term Loan Agreement dated as of
December 19, 2008 by and among Centerline Holding Company and Centerline Capital
Group Inc. as the Borrowers, the Guarantors described therein, the Lenders
described therein, and Bank of America, N.A., as Administrative Agent and
Issuing Bank, as such agreement is amended, restated, supplemented or otherwise
modified from time to time.

    

    
      
        	
                CIBC,Inc.

              
	 
      
	
                By:

              	
                /s/ Robert Novak

              
	
                Name:

              	
                Robert
      Novak

              
	
                Title:

              	
                Authorized
      Signatory

              

      

    

    

    

    Representing _____% of all Term Loans outstanding, all
Revolving Exposure, unused Revolving Loan Commitments and unused Term Loan
Commitments 

    

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Schedule
2

    

    Form of Signature Page for
Lenders included in Required Lenders for purposes of approving FIRST AMENDMENT
TO AMENDED AND RESTATED REVOLVING CREDIT AND TERM LOAN
AGREEMENT:

    

    The
undersigned hereby evidences its agreement to the terms of the FIRST AMENDMENT
TO AMENDED AND RESTATED REVOLVING CREDIT AND TERM LOAN AGREEMENT, and the
consummation of the transactions contemplated thereby, amending that certain
Amended and Restated Revolving Credit and Term Loan Agreement dated as of
December 19, 2008 by and among Centerline Holding Company and Centerline Capital
Group Inc. as the Borrowers, the Guarantors described therein, the Lenders
described therein, and Bank of America, N.A., as Administrative Agent and
Issuing Bank, as such agreement is amended, restated, supplemented or otherwise
modified from time to time.

    

    
      
        	
                Citicorp
      USA

              
	 
      
	
                By:

              	
                /s/ William T. Cahill

              
	
                Name:

              	
                William
      T. Cahill

              
	
                Title:

              	
                Vice-President

              

      

    

    

    

    Representing _____% of all Term Loans outstanding, all
Revolving Exposure, unused Revolving Loan Commitments and unused Term Loan
Commitments 

    

    

    

    

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    

    Schedule
2

    

    Form of Signature Page for
Lenders included in Required Lenders for purposes of approving FIRST AMENDMENT
TO AMENDED AND RESTATED REVOLVING CREDIT AND TERM LOAN
AGREEMENT:

    

    The
undersigned hereby evidences its agreement to the terms of the FIRST AMENDMENT
TO AMENDED AND RESTATED REVOLVING CREDIT AND TERM LOAN AGREEMENT, and the
consummation of the transactions contemplated thereby, amending that certain
Amended and Restated Revolving Credit and Term Loan Agreement dated as of
December 19, 2008 by and among Centerline Holding Company and Centerline Capital
Group Inc. as the Borrowers, the Guarantors described therein, the Lenders
described therein, and Bank of America, N.A., as Administrative Agent and
Issuing Bank, as such agreement is amended, restated, supplemented or otherwise
modified from time to time.

    

    
      
        	
                [Comerica
      Bank]

              
	 
      
	
                By:

              	
                /s/ Sarah R. West

              
	
                Name:

              	
                Sarah
      R. West

              
	
                Title:

              	
                Vice
      President

              

      

    

    

    

    Representing 3.37% of all Term Loans outstanding, all
Revolving Exposure, unused Revolving Loan Commitments and unused Term Loan
Commitments

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