Document:

Unassociated Document

     

    
      EXHIBIT
        10.28

       

    

    FIRST
      AMENDMENT TO

    WYNDCREST
      DD HOLDINGS, INC. 

    2006
      GENERAL COMMON STOCK EQUITY PLAN

    

    

    The
      Wyndcrest DD Holdings, Inc. 2006 General Common Stock Equity Plan (the “Plan”)
      is hereby amended, as of March 27, 2008, as set forth below:

    

    1. Effective
      as of the date hereof, Section 2 of the Plan shall be replaced in its entirety
      as follows:

    

    “2. Shares
      Subject to this Plan

     

    Subject
      to adjustment under Section 8.2, the maximum number of aggregate Shares that
      may
      be issued under this Plan is:

     

    (a)
      16,297,170,

     

    (b)
      plus
      an annual increase to be added on the first day of each fiscal year equal to
      the
      lesser of (i) 2,000,000 Shares, (ii) 3.0% of the Shares outstanding on such
      date, or (iii) a lesser amount determined by the Board; 

     

    provided,
      however, that at no time shall the total number of Shares issuable upon exercise
      of all outstanding Options and the total number of Shares provided for under
      any
      stock bonus or similar plan of the Company exceed the applicable percentage
      as
      calculated in accordance with the conditions and the exclusions set forth in
      either of (i) Section 260.140.45 of the California Code of Regulations or (ii)
      subparagraph (d) of Rule 701 promulgated under the Securities Act, based on
      the
      Shares which are outstanding at the time the calculation is made. To the extent
      an Option later terminates or expires without having been exercised, or is
      surrendered pursuant to an Option Exchange Program, the remaining number of
      Shares available for issuance under this Plan shall be increased by the same
      amount. If Shares issued pursuant to a Restricted Stock Award are repurchased
      by
      the Company at their original purchase price, such Shares shall become available
      for future grant under the Plan.”

     

    2. Except
      as
      amended hereby, the Plan shall remain unmodified and in full force and effect.
      

     

    (signature
      page follows)

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, this First Amendment to Wyndcrest DD Holdings, Inc. 2006
      General Common Stock Equity Plan has been executed as of the day and year first
      above written.

     

    
      	DIGITAL
              DOMAIN	 	 	 
	 	 	 	 	 
	By:	/s/
              Mark Miller	 	 	 
	 	
              

              Name: Mark
                Miller   

              Title: President
                and Chief Executive OfficerUnassociated Document

     

    SECURITIES
      PURCHASE AGREEMENT

     

     

    SECURITIES
      PURCHASE AGREEMENT (this "Agreement"),
      dated
      as of April 4, 2008, by and between Anthracite Capital, Inc., a Maryland
      corporation, with headquarters located at 40 East 52nd
      Street,
      New York, New York 10022 (the "Company"),
      and
      RECP IV Cite CMBS Equity, L.P., a Delaware limited partnership (the "Buyer")
      and
      subsidiary of DLJ Real Estate Capital Partners IV, L.P. ("RECP").

     

     

    WHEREAS:

     

    A. The
      Company and the Buyer are executing and delivering this Agreement in reliance
      upon the exemption from securities registration afforded by Section
      4(2) of the Securities Act of 1933, as amended, and the rules and regulations
      promulgated thereunder (the "1933
      Act"),
      including, as applicable, the "safe harbor" provisions of Rule 506 under
      Regulation D ("Regulation
      D")
      as
      promulgated by the United States Securities and Exchange Commission (the
"SEC")
      under
      the 1933 Act;

     

    B. The
      Board
      of Directors of the Company has authorized (i) a new series of preferred stock,
      $0.001 par value per share, designated as 12% Series E-1 Cumulative Redeemable
      Convertible Preferred Stock (the "Series
      E-1 Preferred Stock"),
      having the rights, preferences and privileges to be set forth in the Articles
      Supplementary to the charter of the Company (the "Series
      E-1 Articles
      Supplementary")
      attached hereto as Exhibit
      A,
      (ii) a
      new series of preferred stock, $0.001 par value per share, designated as 12%
      Series E-2 Cumulative Redeemable Convertible Preferred Stock (the "Series
      E-2 Preferred Stock"),
      having the rights, preferences and privileges to be set forth in the Articles
      Supplementary to the charter of the Company (the "Series
      E-2 Articles
      Supplementary")
      attached hereto as Exhibit
      B,
      and
      (iii) a new series of preferred stock, $0.001 par value per share, designated
      as
      12% Series E-3 Cumulative Redeemable Convertible Preferred Stock (the
      "Series
      E-3 Preferred Stock"),
      having the rights, preferences and privileges to be set forth in the Articles
      Supplementary to the charter of the Company (the "Series
      E-3 Articles
      Supplementary"
      and,
      together with the Series E-1 Articles Supplementary and the Series E-2 Articles
      Supplementary, the "Articles
      Supplementary")
      attached hereto as Exhibit
      C;

     

    C. The
      Buyer
      desires to purchase and the Company desires to issue and sell, upon the terms
      and conditions set forth in this Agreement, (i) 23,375 shares of the Series
      E-1
      Preferred Stock (together with any preferred stock issued in replacement thereof
      or otherwise with respect thereto in accordance with the terms thereof, the
      "Series
      E-1 Preferred
      Shares"),
      (ii)
      23,375 shares of the Series E-2 Preferred Stock (together with any preferred
      stock issued in replacement thereof or otherwise with respect thereto in
      accordance with the terms thereof, the "Series
      E-2 Preferred
      Shares"),
      (iii)
      23,375 shares of the Series E-3 Preferred Stock (the "Series
      E-3 Preferred
      Shares"
      and,
      together with the Series E-1 Preferred Shares and the Series E-2 Preferred
      Shares, the "Preferred
      Shares")
      and
      (iv) 3,494,021 shares (the "Common
      Shares"
      and,
      together with the Preferred Shares, the "Shares")
      of the
      Company's common stock, $0.001 par value per share ("Common
      Stock")
      for an
      aggregate purchase price of ninety-three million and five hundred thousand
      dollars ($93,500,000) (the "Purchase
      Price");
      a
      summary of the terms of the Shares is set forth in the Letter of Intent executed
      by the Company and RECP on March 28, 2008;

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    D. The
      Preferred Shares shall have the rights, terms and conditions, and are
      convertible into shares of Common
      Stock,
      as set
      forth in the Articles Supplementary;

     

    E. On
      the
      Closing Date (as defined below), the parties hereto will execute and deliver
      a
      Registration Rights Agreement (the "Registration
      Rights Agreement"),
      substantially in the form attached hereto as Exhibit
      D,
      pursuant to which the Company has agreed to provide certain registration rights
      under the 1933 Act and the rules and regulations promulgated thereunder, and
      applicable state securities laws; and

     

    F. On
      the
      Closing Date, the Company will deliver to the Buyer a certificate executed
      by
      the Secretary of the Company attaching the resolution of the Board of Directors
      of the Company granting an exemption to the Buyer from the ownership limit
      set
      forth in Section 6.1.2(a) of the Company's charter.

     

    NOW
      THEREFORE, in consideration of the mutual covenants and agreements herein
      contained and intending to be legally bound, the Company and the Buyer hereby
      agree as follows:

     

    
      
        1.
          PURCHASE
          AND SALE OF THE SHARES.

      

    

     

    A. PURCHASE
      OF THE
      SHARES. On the Closing Date (as defined below), the Company agrees to issue
      and
      sell to the Buyer and the Buyer agrees to purchase from the Company the
      Preferred Shares and the Common Shares.

     

    B. FORM
      OF
      PAYMENT. On or prior to the Closing Date, subject to the satisfaction (or
      waiver) of all of the terms and conditions set forth herein, and in reliance
      on
      the representations, warranties and covenants set forth or referred to herein,
      the Buyer agrees to pay the Purchase Price to the Company, which shall be
      $23,375,000 for the Series E-1 Preferred Shares, $23,375,000 for the Series
      E-2
      Preferred Shares, $23,375,000 for the Series E-3 Preferred Shares and
      $23,375,000 for the Common Shares to be issued and sold to it at the Closing
      (as
      defined below), by wire transfer of immediately available funds to the account
      designated by the Company at least one (1) business day prior to the Closing
      Date, against delivery of duly executed certificates registered in the name
      of
      the Buyer and in the form agreed upon by the Company and the Buyer representing
      the Shares which the Buyer is purchasing.

     

    C. CLOSING
      DATE. Subject to the satisfaction (or waiver) of all of the terms and conditions
      set forth in Section 5 and Section 6 below, the date and time of the issuance
      and sale of the Shares pursuant to this Agreement (the "Closing
      Date")
      shall
      be 9:00 a.m. EDT on April 4, 2008 (the "Closing").

     

    
       

      
        
          2.
            BUYER'S
            REPRESENTATIONS AND WARRANTIES. The Buyer represents and warrants to
            the Company
            that:

        

      

       

    

    A. INVESTMENT
      PURPOSE. The
      Buyer
      is purchasing the Shares and the shares of Common Stock issuable upon conversion
      or otherwise pursuant to the Preferred Shares (such shares of Common Stock
      sometimes referred to herein as the "Conversion
      Shares"
      and,
      collectively with the Shares, the "Securities")
      for its
      own account and not with a present view towards the public sale or distribution
      thereof, except pursuant to sales registered or exempted from registration
      under
      the 1933 Act; provided, however, that by making the representation herein,
      the
      Buyer does not agree to hold any of the Securities for any minimum or other
      specific term and reserves the right to dispose of the Securities at any time
      in
      accordance with or pursuant to a registration statement or an exemption under
      the 1933 Act. Notwithstanding the foregoing or anything else contained herein
      to
      the contrary, the Securities may be pledged as collateral in connection with
      a
      bona fide margin account or other lending arrangement to the extent such a
      pledge is in accordance with applicable laws, including the 1933 Act, and does
      not affect the exemption from registration afforded to the offer and sale of
      the
      Securities described herein.

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    B. ACCREDITED
      INVESTOR STATUS. RECP owns greater than 95% of the equity interests of the
      Buyer
      and RECP is an institutional "accredited investor" as that term is defined
      in
      Rule 501(a) of Regulation D (an "Accredited
      Investor").

     

    C. RELIANCE
      ON EXEMPTIONS. The Buyer understands that the Securities are being offered
      and
      sold to it in reliance upon specific exemptions from the registration
      requirements of United States federal and state securities laws and that the
      Company is relying upon the truth and accuracy of, and the Buyer's compliance
      with, the representations, warranties, agreements, acknowledgments and
      understandings of the Buyer set forth herein in order to determine the
      availability of such exemptions and the eligibility of the Buyer to acquire
      the
      Securities. The Buyer acknowledges that it has reviewed the provisions of Rule
      144 (as defined below) and in connection with the sale of the Securities other
      than pursuant to an effective registration statement under the 1933 Act will
      comply with terms of such rule or another available exemption from
      registration.

     

    D. INFORMATION.
      The Buyer and its advisors have been furnished with all materials relating
      to
      the business, finances and operations of the Company and materials relating
      to
      the offer and sale of the Securities which have been requested by the Buyer
      or
      its advisors. The Buyer and its advisors have been afforded the opportunity
      to
      ask questions of and receive answers from the Company. Neither such inquiries
      nor any other due diligence investigation conducted by the Buyer or any of
      its
      advisors or representatives shall modify, amend or affect the Buyer's right
      to
      rely on the Company's representations and warranties contained in Section 3
      below. The Buyer represents that it has the financial sophistication to evaluate
      the risks and merits of, and make an informed decision with regard to, an
      investment in the Company and the Securities. The Buyer understands that its
      investment in the Securities involves a significant degree of risk and that
      it
      is able to bear the economic risk of an investment in the
      Securities.

     

    E. GOVERNMENTAL
      REVIEW. The Buyer understands that no United States federal or state agency
      or
      any other government or governmental agency has passed upon or made any
      recommendation or endorsement of the Securities.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    F. TRANSFER
      OR RE-SALE. The Buyer understands that: (i) except as provided in the
      Registration Rights Agreement, the sale or re-sale of the Securities has not
      been and is not being registered under the 1933 Act or any applicable state
      securities laws, and the Securities may not be sold or transferred unless (A)(1)
      the Securities are sold pursuant to an effective registration statement under
      the 1933 Act or (2) an exemption from registration under the 1933 Act or any
      applicable state securities laws is available and (B) the Securities are sold
      or
      transferred in compliance with certain provisions of the Company's Articles
      of
      Amendment and Restatement, as amended (the "Articles"),
      relating to the Company's election to be organized and conduct its operations
      in
      a manner intended to qualify as a real estate investment trust (a "REIT")
      under
      the rules and regulations of the Internal Revenue Code of 1986, as amended
      (the
"Code"),
      as
      described in the Company's reports and filings available on the SEC's Electronic
      Data Gathering, Analysis, and Retrieval ("EDGAR")
      system, including the Company's Annual Report on Form 10-K for the year ended
      December 31, 2007, filed with the SEC on March 13, 2008; (ii) any sale of such
      Securities made in reliance on Rule 144 promulgated under the 1933 Act (or
      a
      successor rule) ("Rule
      144")
      may be
      made only in accordance with the terms of said Rule 144 and further, if said
      Rule 144 is not applicable, any re-sale of such Securities under circumstances
      in which the seller (or the person through whom the sale is made) may be deemed
      to be an underwriter (as that term is defined in the 1933 Act) may require
      compliance with some other exemption under the 1933 Act or the rules and
      regulations of the SEC promulgated thereunder; and (iii) except as provided
      in
      the Registration Rights Agreement, neither the Company nor any other person
      is
      under any further obligation to register such Securities under the 1933 Act
      or
      any state securities laws or to comply with the terms and conditions of any
      exemption thereunder (in each case, other than pursuant to the Registration
      Rights Agreement). Notwithstanding the foregoing or anything else contained
      herein to the contrary, the Securities may be pledged as collateral in
      connection with a bona fide margin account or other lending arrangement to
      the
      extent such a pledge is in accordance with applicable laws, including the 1933
      Act, and does not affect the exemption from registration afforded to the offer
      and sale of the Securities described herein.

     

    G. LEGENDS.
      The Buyer understands that the Shares shall bear a restrictive legend in
      substantially the following form (and a stop-transfer order may be placed
      against transfer of the certificates for such Securities):

     

    "THIS
      SECURITY HAS BEEN ACQUIRED FOR INVESTMENT AND WITHOUT A VIEW TO DISTRIBUTION
      AND
      HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE
"ACT"),
      OR UNDER STATE SECURITIES LAWS. NO TRANSFER, SALE, ASSIGNMENT, PLEDGE,
      HYPOTHECATION OR OTHER DISPOSITION OF THIS SECURITY OR ANY INTEREST OR
      PARTICIPATION THEREIN MAY BE MADE EXCEPT (A) PURSUANT TO AN EFFECTIVE
      REGISTRATION STATEMENT UNDER THE ACT OR (B) PURSUANT TO AN EXEMPTION FROM
      REGISTRATION UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS AND, IN THE
      CASE
      OF CLAUSE (B), IF REQUESTED BY THE ISSUER, UNLESS THE ISSUER RECEIVES AN OPINION
      OF COUNSEL IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE ISSUER TO THE
      EFFECT THAT REGISTRATION IS NOT REQUIRED UNDER THE ACT AND APPLICABLE STATE
      SECURITIES LAWS."

     

    Within
      three business days of the Company's receipt of an instruction from a holder
      to
      remove the legend set forth above, the legend set forth above shall be removed
      and the Company shall issue a certificate without such legend to the holder
      of
      any Security upon which it is stamped, if, unless otherwise required by
      applicable state securities laws, (a) such Security is sold pursuant to an
      effective registration statement filed under the 1933 Act or otherwise may
      be
      sold pursuant to Rule 144 without any restriction as to the number of securities
      as of a particular date that can then be immediately sold, or (b) such holder
      provides the Company and its transfer agent with documentation and/or assurances
      reasonably satisfactory to each such party that such Security can be sold
      pursuant to Rule 144. The Buyer agrees to sell all Securities, including those
      represented by a certificate(s) from which the legend has been removed, in
      compliance with applicable prospectus delivery requirements, if
      any.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    Until
      (i)
      the Board of Directors of the Company determines it is no longer in the best
      interests of the Company to attempt to, or continue to, qualify as a REIT and
      (ii) there is an affirmative vote of not less than two-thirds of all of the
      votes ordinarily entitled to be cast in the election of directors, voting
      together as a single class approving the determination of the Board of Directors
      set forth in clause (i) above, the Shares shall bear a legend in substantially
      the following form (and a stop-transfer order may be placed against transfer
      of
      the certificates for such Shares):

     

    "THE
      SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS ON
      TRANSFER FOR THE PURPOSE OF THE COMPANY'S ELECTION TO BE SUBJECT TO TAX AS
      A
      REAL ESTATE INVESTMENT TRUST UNDER THE INTERNAL REVENUE CODE OF 1986, AS AMENDED
      (THE "CODE").
      SUBJECT TO THE EXEMPTIONS GRANTED (I) UNDER THE SECURITIES PURCHASE AGREEMENT
      DATED APRIL
      4,
      2008, BETWEEN THE COMPANY AND RECP
      IV CITE CMBS EQUITY, L.P.,
      A DELAWARE
      LIMITED PARTNERSHIP
      AND SUBSIDIARY
      OF DLJ REAL ESTATE CAPITAL PARTNERS IV, L.P., OR (II) PURSUANT TO SECTION 6.1.7
      OF THE ARTICLES
      OF INCORPORATION OF THE COMPANY
      NO PERSON MAY (I) BENEFICIALLY OWN OR CONSTRUCTIVELY OWN SHARES OF COMMON STOCK
      IN EXCESS OF 9.8% OF THE NUMBER OF OUTSTANDING SHARES OF COMMON STOCK, (II)
      BENEFICIALLY OWN OR CONSTRUCTIVELY OWN SHARES OF ANY CLASS OR SERIES OF
      PREFERRED STOCK IN EXCESS OF 9.8% OF THE NUMBER OF OUTSTANDING SHARES OF SUCH
      CLASS OR SERIES OF PREFERRED STOCK, (III) BENEFICIALLY OWN SHARES OF EQUITY
      STOCK THAT WOULD RESULT IN THE SHARES OF EQUITY STOCK BEING BENEFICIALLY OWNED
      BY FEWER THAN 100 PERSONS (DETERMINED WITHOUT REFERENCE TO ANY RULES OF
      ATTRIBUTION), OR (IV) BENEFICIALLY OWN OR CONSTRUCTIVELY OWN SHARES OF EQUITY
      STOCK THAT WOULD RESULT IN THE COMPANY BEING "CLOSELY HELD" WITHIN THE MEANING
      OF SECTION 856(H) OF THE CODE. ANY PERSON WHO ATTEMPTS TO BENEFICIALLY OWN
      OR
      CONSTRUCTIVELY OWN SHARES OF EQUITY STOCK IN EXCESS OF THE ABOVE LIMITATIONS
      MUST IMMEDIATELY NOTIFY THE COMPANY IN WRITING. IF THE RESTRICTIONS ABOVE ARE
      VIOLATED, THE SHARES OF EQUITY STOCK REPRESENTED HEREBY WILL BE TRANSFERRED
      AUTOMATICALLY AND BY OPERATION OF LAW TO A TRUST AND SHALL BE DESIGNATED
      SHARES-IN-TRUST FOR THE BENEFIT OF ONE
      OR MORE CHARITABLE BENEFICIARIES.
      ALL CAPITALIZED TERMS IN THIS LEGEND HAVE THE MEANINGS DEFINED IN THE COMPANY'S
      ARTICLES OF
      AMENDMENT AND RESTATEMENT
      FILED WITH THE DEPARTMENT OF ASSESSMENTS AND TAXATION OF THE STATE OF MARYLAND
      ON MARCH 20, 1998, AS THE SAME MAY BE FURTHER AMENDED FROM TIME TO TIME, A
      COPY
      OF WHICH, INCLUDING THE RESTRICTIONS ON TRANSFER, WILL BE SENT WITHOUT CHARGE
      TO
      EACH STOCKHOLDER WHO SO REQUESTS."

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    H. OWNERSHIP
      LIMITATIONS. The
      Buyer
      understands, subject to the Exemption, the restrictions on transfer and
      ownership of the Company's shares of beneficial interest included in the
      Articles and this Agreement as such restrictions relate to the election by
      the
      Company to be taxed as a REIT for United States federal income tax purposes
      pursuant to Sections 856 through 860 of the Code (the "REIT
      Provisions of the Code"),
      and as
      described in the Company's reports and filings available on the SEC's EDGAR
      system, including the Company's Annual Report on Form 10-K for the year ended
      December 31, 2007, filed with the SEC on March 13, 2008.

     

    I. AUTHORIZATION;
      ENFORCEMENT. This Agreement and the Registration Rights Agreement have been
      duly
      and validly authorized by the Buyer. This Agreement has been duly executed
      and
      delivered on behalf of the Buyer, and this Agreement constitutes, and upon
      execution and delivery by the parties of the Registration Rights Agreement,
      such
      agreement will constitute, valid and binding agreements of the Buyer enforceable
      in accordance with their terms, subject, in each case, to applicable bankruptcy,
      insolvency, reorganization or similar laws affecting generally the enforcement
      of creditors' rights and subject to a court's discretionary authority with
      respect to the granting of specific performance or other equitable
      remedies.

     

    J. NO
      CONFLICTS. The execution and performance of this Agreement does not, and the
      execution and performance of the Registration Rights Agreement will not,
      conflict with any agreement to which the Buyer is a party or is bound thereby,
      any court order or judgment addressed to the Buyer, or the constituent documents
      of the Buyer.

     

    K. RESIDENCY;
      ORGANIZATION. The Buyer is a resident of the jurisdiction set forth immediately
      below such Buyer's name on the signature pages hereto. The Buyer is validly
      existing and in good standing (to the extent the concept exists) as a limited
      partnership under laws of the jurisdiction of its organization.

     

    L. USE
      OF
      ASSETS. The assets being used by the Buyer to purchase the Securities do not
      constitute assets of any employee benefit plan (within the meaning of Section
      3(3) of the Employee Retirement Income Security Act of 1974, as amended), or
      any
      plan (within the meaning of Section 4975 of the Code).

     

     

    3.
      REPRESENTATIONS
      AND WARRANTIES OF THE COMPANY. The Company represents and warrants to the Buyer
      that:

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    A. NO
      REGISTRATION.
      Assuming the accuracy of the representations and warranties of the Buyer
      contained in Section 2 and its compliance with the agreements set forth therein,
      it is not necessary, in connection with the issuance and sale of the Shares
      to
      the Buyer in the manner contemplated by this Agreement, to register the Shares
      under the 1933 Act.

     

    B. NO
      INTEGRATION.
      None of
      the Company or any of its subsidiaries has, directly or through any agent,
      sold,
      offered for sale, solicited offers to buy or otherwise negotiated in respect
      of,
      any "security" (as defined in the 1933 Act) that is or will be integrated with
      the sale of the Shares in a manner that would require registration under the
      1933 Act of the Shares.

     

    C. RULE
      144A.
      No
      securities of the same class (within the meaning of Rule 144A(d)(3) under the
      1933 Act) as the Preferred Shares are listed on any national securities exchange
      registered under Section 6 of the 1934 Act, or quoted on an automated
      inter-dealer quotation system.

     

    D. EXCLUSIVE
      AGREEMENT.
      The
      Company has not paid or agreed to pay to any person any compensation for
      soliciting another person to purchase any securities of the Company in
      connection with the offer and sale of the Shares by the Buyer (except as
      contemplated in this Agreement).

     

    E. AUTHORIZATION
      OF THE PURCHASE AGREEMENT.
      This
      Agreement has been duly authorized, executed and delivered by the Company.
      This
      Agreement constitutes a valid and binding agreement of the Company, enforceable
      against the Company in accordance with its terms, subject to applicable
      bankruptcy, insolvency, reorganization or similar laws affecting generally
      the
      enforcement of creditors' rights and subject to a court's discretionary
      authority with respect to the granting of specific performance or other
      equitable remedies.

     

    F. AUTHORIZATION
      OF THE SHARES.
      The
      Shares have been duly authorized and, upon issuance in accordance with the
      terms
      of this Agreement and payment in respect thereof, will be validly issued, fully
      paid and non-assessable, and the issuance of such shares will not be subject
      to
      any preemptive or similar rights. The filing of the Articles Supplementary
      has
      been duly authorized.

     

    G. AUTHORIZATION
      OF THE CONVERSION SHARES.
      The
      Conversion Shares have been duly authorized and reserved and, when issued upon
      conversion of the Preferred Shares in accordance with the terms thereof, will
      be
      validly issued, fully paid and non-assessable, and the issuance of such shares
      will not be subject to any preemptive or similar rights.

     

    H. AUTHORIZATION
      OF THE REGISTRATION RIGHTS AGREEMENT.
      The
      Registration Rights Agreement has been duly authorized, executed and delivered
      by the Company and is a valid and binding agreement of, the Company, enforceable
      against the Company in accordance with its terms, (i) subject to applicable
      bankruptcy, insolvency, reorganization or similar laws affecting generally
      the
      enforcement of creditors' rights and subject to a court's discretionary
      authority with respect to the granting of specific performance or other
      equitable remedies and (ii) subject to applicable laws affecting the
      enforceability of provisions imposing a payment obligation pending the ability
      of the Company to comply timely with its registration obligations under the
      Registration Rights Agreement. Except as described in the 1934 Act Reports
      (as
      defined below), the Company has not granted or agreed to grant to any person
      or
      entity any rights (including "piggy-back" registration rights) to have any
      securities of the Company registered with the SEC or any other governmental
      authority that have not expired or been satisfied or waived.

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    I. NO
      MATERIAL ADVERSE CHANGE.
      Except
      as otherwise disclosed in the Company's reports (the "1934
      Act Reports")
      filed
      with the SEC pursuant to Section 13 or 15 of the Securities Exchange Act of
      1934, as amended, and all of the rules and regulations promulgated thereunder
      (the "1934
      Act")
      and
      the other filings of the Company available on EDGAR (together with the 1934
      Act
      Reports, the "SEC
      Reports"):
      (i)
      there has been no material adverse change, or any development that could
      reasonably be expected to result in a material adverse change, in the condition
      (financial or otherwise), or in the results of operations, properties, business
      or prospects of the Company and its subsidiaries, considered as one entity
      (a
      "Material
      Adverse Change");
      (ii)
      the Company and its subsidiaries, considered as one entity, have not incurred
      any material liability or obligation, indirect, direct or contingent, nor
      entered into any material transaction or agreement, except the Management
      Agreement between the Company and BlackRock Financial Management, Inc.; and
      (iii) there has been no dividend or distribution of any kind declared, paid
      or
      made by the Company or, except for dividends paid by the Company or other
      subsidiaries on any class of capital stock or repurchase or redemption by the
      Company or any of its subsidiaries of any class of capital stock.

     

    J. PREPARATION
      OF THE FINANCIAL STATEMENTS.
      The
      financial statements included in the Company's Annual Report on Form 10-K for
      the most recent fiscal year present fairly the consolidated financial position
      of the Company and its consolidated subsidiaries as of and at the dates
      indicated and the results of their operations and cash flows for the periods
      specified. Such financial statements comply as to form in all material respects
      with the applicable accounting requirements of Regulation S-X and have been
      prepared in conformity with generally accepted accounting principles as applied
      in the United States applied on a consistent basis throughout the periods
      involved, except as may be expressly stated in the related notes
      thereto.

     

    K. INCORPORATION
      AND GOOD STANDING OF THE COMPANY AND ITS SUBSIDIARIES.
      Each of
      the Company and its subsidiaries has been duly organized, is validly existing
      and in good standing (to the extent the concept exists) as a corporation or
      other business entity under the laws of its jurisdiction of organization and
      is
      duly qualified to do business and in good standing as a foreign corporation
      or
      other business entity in each jurisdiction in which its ownership or lease
      of
      property or the conduct of its businesses requires such qualification, except,
      in each case, where the failure to be so qualified or in good standing (or
      the
      failure of a subsidiary that is not a Significant Subsidiary (as defined below)
      to be duly organized or validly existing) could not, individually or in the
      aggregate, reasonably be expected to have a material adverse effect on the
      condition (financial or otherwise), results of operations, properties, business
      or prospects of the Company and its subsidiaries taken as a whole (a
      "Material
      Adverse Effect");
      each
      of the Company and its subsidiaries has all power and authority necessary to
      own
      or hold its properties and to conduct the businesses in which it is engaged
      and,
      in the case of the Company, to enter into and perform its obligations under
      this
      Agreement except where the failure to have such power or authority could not,
      in
      the aggregate, reasonably be expected to have a Material Adverse Effect. Exhibit
      21 to the Company's Annual Report on Form 10-K for the most recent fiscal year
      lists all of the Company's subsidiaries as of such date. All of the issued
      and
      outstanding shares of capital stock of each subsidiary have been duly authorized
      and validly issued, are fully paid and non-assessable and are owned by the
      Company, directly or through subsidiaries, free and clear of all liens,
      encumbrances, equities or claims, except for such liens, encumbrances, equities
      or claims ("Encumbrances")
      as
      could not, in the aggregate, reasonably be expected to have a Material Adverse
      Effect or such Encumbrances as are described in the SEC Reports.

     

    
      
        
        

      

      
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    L. CAPITALIZATION
      AND OTHER CAPITAL STOCK MATTERS.
      The
      Company has an authorized capitalization as set forth in the Company's Annual
      Report on Form 10-K for the most recent fiscal year, and all of the issued
      shares of capital stock of the Company have been duly authorized and validly
      issued, are fully paid and non-assessable, and were issued in compliance with
      federal and state securities laws and not in violation of any preemptive right,
      resale right, right of first refusal or similar right. All of the Company's
      options, warrants and other rights to purchase or exchange any securities for
      shares of the Company's capital stock have been duly authorized and validly
      issued, conform to the description thereof contained in the Company's Annual
      Report on Form 10-K for the most recent fiscal year and were issued in
      compliance with federal and state securities laws. The Company has not, in
      the
      twelve months preceding the date hereof, received notice (written or oral)
      from
      the NYSE to the effect that the Company is not in compliance with its listing
      or
      maintenance requirements.

     

    M. NON-CONTRAVENTION
      OF EXISTING INSTRUMENTS; NO FURTHER AUTHORIZATIONS OR APPROVALS
      REQUIRED.
      (i)
      Neither the Company nor any of its subsidiaries listed on Schedule 3(M) hereto
      (the "Significant
      Subsidiaries")
      is in
      violation of its charter or by-laws (or similar organizational documents).
      (ii)
      Neither the Company nor any of its subsidiaries (A) is in default, and no event
      has occurred that, with notice or lapse of time or both, would constitute such
      a
      default, in the due performance or observance of any term, covenant or condition
      contained in any indenture, mortgage, deed of trust, loan agreement, or other
      agreement or instrument to which it is a party or by which it is bound or to
      which any of its properties or assets is subject (each, an "Existing
      Instrument")
      or (B)
      is in violation of any statute or any order, rule or regulation of any court
      or
      governmental agency or body having jurisdiction over it or its property or
      assets, except in the case of clauses (ii)(A) and (B) above, to the extent
      any
      such conflict, breach, violation or default could not, in the aggregate,
      reasonably be expected to have a Material Adverse Effect.

     

    The
      execution and delivery of and performance of its obligations under this
      Agreement, the Registration Rights Agreement and the Articles Supplementary
      (collectively, the "Operative
      Documents")
      by the
      Company, the consummation of the transactions contemplated hereby and the
      application of the proceeds from the sale of the Shares (i) will not conflict
      with or result in (or constitute an event which with notice or passage of time
      would conflict with or result in) a
      breach
      or violation of any of the terms or provisions of, impose any lien, charge
      or
      encumbrance upon any property or assets of the Company and its subsidiaries,
      or
      constitute a default under, any Existing Instrument; (ii) have been duly
      authorized by all necessary corporate action and will not result in any
      violation of the provisions of the charter or by-laws (or similar organizational
      documents) of (A) the Company or (B) any of its subsidiaries; or (iii) will
      not result in any violation of any statute or any order, rule or regulation
      of
      any court or governmental agency or body having jurisdiction over the Company
      or
      any of its subsidiaries or any of their properties or assets, except in the
      case
      of clause (i), (ii)(B) and (ii)(C) above as would not have a Material Adverse
      Effect or interfere with the transactions contemplated by this
      Agreement.

     

    
      
        
        

      

      
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    No
      consent, approval, authorization or order of, or filing or registration with,
      any court or governmental agency or body having jurisdiction over the Company
      or
      any of its Significant Subsidiaries or any of their properties or assets is
      required for the execution and delivery of and performance of its obligations
      under the Operative Documents by the Company, the consummation of the
      transactions contemplated hereby or the application of the proceeds from the
      sale of the Shares, except (i) with respect to the transactions contemplated
      by
      the Registration Rights Agreement, as may be required under the 1933 Act and
      the
      rules and regulations promulgated thereunder, and (ii) such as have been
      obtained or made by the Company and are in full force and effect under the
      1933
      Act, applicable state securities or blue sky laws and from the Financial
      Industry Regulatory Authority, Inc. (the "FINRA")
      and
      the New York Stock Exchange, Inc. (the "NYSE").

     

    N. NO
      STAMP
      OR TRANSFER TAXES.
      To the
      Company's knowledge, there are no stamp or other issuance or transfer taxes
      or
      other similar fees or charges under federal law or the laws of any state, or
      any
      political subdivision thereof, required to be paid in connection with the
      execution and delivery of this Agreement or the issuance by the Company or
      sale
      by the Company of the Shares or upon the issuance of Conversion Shares upon
      the
      conversion of the Preferred Shares.

     

    O. NO
      MATERIAL ACTIONS OR PROCEEDINGS.
      Except
      as otherwise disclosed in the SEC Reports, there are no legal or governmental
      proceedings pending to which the Company or any of its subsidiaries is a party
      or of which any property or assets of the Company or any of its subsidiaries
      is
      the subject that could, in the aggregate, reasonably be expected to have a
      Material Adverse Effect or could, in the aggregate, reasonably be expected
      to
      have a material adverse effect on the performance of this Agreement or the
      consummation of the transactions contemplated hereby; and to the Company's
      knowledge, no such proceedings are threatened or contemplated by governmental
      authorities or others.

     

    P. LABOR
      MATTERS.
      Neither
      the Company nor any of its subsidiaries has any employees.

     

    Q. INTELLECTUAL
      PROPERTY RIGHTS.
      The
      Company and each of its subsidiaries own or possess adequate license or other
      rights to use all patents, trademarks, service marks, trade names, copyrights,
      software and design licenses, trade secrets, and other intangible property
      rights (collectively, "Intangibles")
      necessary to entitle the Company and each of its subsidiaries to conduct their
      respective businesses as described in the SEC Reports except where the failure
      to own or possess such licenses or rights would not in the aggregate have a
      Material Adverse Effect, and neither the Company nor any subsidiary has received
      written notice of any infringement of or conflict with (and the Company does
      not
      know of any such infringement of or conflict with) asserted rights of others
      with respect to any Intangibles that would have a Material Adverse
      Effect.

     

    
      
        
        

      

      
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    R. ALL
      NECESSARY PERMITS, ETC.
      The
      Company and each of its subsidiaries have such permits, licenses, franchises,
      certificates and other approvals or authorizations of governmental or regulatory
      authorities ("Permits")
      as are
      necessary under applicable law to own their properties and conduct their
      businesses in the manner described in SEC Reports, except for any of the
      foregoing that could not, in the aggregate, reasonably be expected to have
      a
      Material Adverse Effect; each of the Company and its subsidiaries has fulfilled
      and performed all of its obligations with respect to the Permits, except where
      the failure to fulfill or perform would not have a Material Adverse Effect,
      and
      no event has occurred that allows, or after notice or lapse of time would allow,
      revocation or termination thereof or results in any other impairment of the
      rights of the holder or any such Permits, except for any of the foregoing that
      could not reasonably be expected to have a Material Adverse Effect.

     

    S. TITLE
      TO
      PROPERTIES.
      The
      Company and its subsidiaries have good and marketable title in fee simple to
      all
      real property and good and marketable title to all personal property owned
      by
      them, in each case free and clear of any and all liens except such as are
      described in the SEC Reports or such as would not have, individually or in
      the
      aggregate, a Material Adverse Effect; and any real property and buildings held
      under lease or sublease by the Company and its subsidiaries are held by them
      under valid, subsisting and enforceable leases with such exceptions as are
      not
      material to, and do not materially interfere with, the use made and proposed
      to
      be made of such property and buildings by the Company and its subsidiaries.
      Neither the Company nor any Significant Subsidiary has received any notice
      of
      any claim adverse to its ownership of any real or personal property or of any
      claim against the continued possession of any real property, whether owned
      or
      held under lease or sublease by the Company or any Significant
      Subsidiary.

     

    T. TAX
      LAW
      COMPLIANCE.
      The
      Company and each subsidiary have accurately prepared in all material respects
      and timely filed all material federal, state, foreign and other tax returns
      that
      are required to be filed by it and have paid or made provision for the payment
      of all material taxes, assessments, governmental or other similar charges,
      including without limitation, all sales and use taxes and all taxes which the
      Company or any subsidiary is obligated to withhold from amounts owing to
      employees, creditors and third parties, with respect to the periods covered
      by
      such tax returns (whether or not such amounts are shown as due on any tax
      return. No material deficiency assessment with respect to a proposed adjustment
      of the Company's or any subsidiary's federal, state, local or foreign taxes
      is
      pending or, to the Company's knowledge, threatened. There is no tax lien,
      whether imposed by any federal, state, foreign or other taxing authority,
      outstanding against the assets, properties or business of the Company or any
      subsidiary, except for any such liens that would not, individually or in the
      aggregate, have a Material Adverse Effect.

     

    U. COMPANY
      NOT AN "INVESTMENT COMPANY".
      The
      Company is not, and after receipt of payment for the Shares and application
      of
      the proceeds will not be, an "investment company" within the meaning of the
      Investment Company Act of 1940, as amended, and the rules and regulations of
      the
      SEC thereunder.

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    V. COMPLIANCE
      WITH REPORTING REQUIREMENTS.
      The
      Company is subject to and in full compliance with the reporting requirements
      of
      Section 13 or Section 15(d) of the 1934 Act. The Company has filed all reports
      required to be filed by it under the Exchange Act for the 12 months preceding
      the date hereof on a timely basis, with the exception of certain Form 4s that
      were filed late and will be disclosed in the Company's proxy statement for
      2008.
      Such reports, together with any materials filed or furnished by the Company
      under the Exchange Act, whether or not any such reports were required being
      collectively referred to herein as the "SEC
      Reports"
      and,
      together with this Agreement and the Schedules to this Agreement, the
      "Disclosure
      Materials."
      As of
      their respective dates, the SEC Reports filed by the Company complied in all
      material respects with the requirements of the 1933 Act and the 1934 Act and
      the
      rules and regulations of the SEC promulgated thereunder, and none of the SEC
      Reports, when filed by the Company, contained any untrue statement of a material
      fact or omitted to state a material fact required to be stated therein or
      necessary in order to make the statements therein, in the light of the
      circumstances under which they were made, not misleading.

     

    W. INSURANCE.
      Except
      as otherwise disclosed in the SEC Reports, the Company and its Significant
      Subsidiaries are insured by recognized, financially sound and reputable
      institutions with policies in such amounts and with such deductibles and
      covering such risks as are generally deemed adequate and customary for their
      businesses including, but not limited to, policies covering real and personal
      property owned or leased by the Company and its Significant Subsidiaries against
      theft, damage, destruction, acts of terrorism or vandalism and earthquakes,
      it
      being understood that the only insurance held by the Company and its Significant
      Subsidiaries are directors and officers insurance policies. The Company and
      its
      Significant Subsidiaries are in compliance with the terms of such policies
      and
      instruments in all material respects. None of the Company nor any of its
      Significant Subsidiaries has reason to believe that it will not be able to
      renew
      its existing insurance coverage as and when such coverage expires or to obtain
      similar coverage from similar insurers as may be necessary to continue its
      business at a cost that would not have a Material Adverse Effect. Within the
      past twelve months, neither the Company nor any of it Significant Subsidiaries
      has been denied any insurance coverage that it has sought or for which it has
      applied.

     

    X. NO
      RESTRICTION ON DISTRIBUTIONS.
      No
      Significant Subsidiary of the Company is currently prohibited, directly or
      indirectly, from paying any dividends to the Company, from making any other
      distribution on such subsidiary's capital stock, from repaying to the Company
      any loans or advances to such subsidiary from the Company or from transferring
      any of such subsidiary's property or assets to the Company or any other
      subsidiary of the Company, except as described in or contemplated by the SEC
      Reports.

     

    Y. SECURITIES
      LAWS.

     

    (i) Assuming
      the accuracy of the Buyer's representations and warranties set forth in Section
      2, the offer, sale and issuance of the Securities as provided in this Agreement
      is and is intended to be exempt from the registration requirements of the 1933
      Act pursuant to Section 4(2) thereof.

     

    (ii) Neither
      the Company nor anyone acting on its behalf has offered the Preferred Shares
      for
      sale to, or solicited any offer to buy any of the same from, or otherwise
      approached or negotiated in respect thereof with, any person other than the
      Buyer, which has been offered the Shares as a private sale for
      investment.

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    (iii) None
      of
      the Company nor any of its affiliates has offered the Preferred Shares during
      the six months prior to the date hereof to anyone other than the Buyer. The
      Company has no intention to offer the Preferred Shares during the six months
      after the date hereof.

     

    (iv) Neither
      the Company nor any person acting on its behalf has offered or sold the Shares
      by any form of general solicitation or general advertising, including, but
      not
      limited to, the following: (A) any advertisement, article, notice or other
      communication published in any newspaper, magazine, or similar media or
      broadcast over television or radio; (B) any website posting or widely
      distributed e-mail; or (C) any seminar or meeting whose attendees have been
      invited by any general solicitation or general advertising.

     

    Z. NO
      UNLAWFUL CONTRIBUTIONS OR OTHER PAYMENTS.
      Neither
      the Company nor any of its Significant Subsidiaries, nor, to the knowledge
      of
      the Company, any director, officer, agent, employee or other person associated
      with or acting on behalf of the Company or any of its Significant Subsidiaries,
      has, while acting on behalf of the Company or any of its Significant
      Subsidiaries, (i) used any corporate funds for any unlawful contribution, gift,
      entertainment or other unlawful expense relating to political activity; (ii)
      made any direct or indirect unlawful payment to any foreign or domestic
      government official or employee from corporate funds; or (iii) violated or
      is in
      violation of any provision of the U.S. Foreign Corrupt Practices Act of 1977,
      as
      amended, and the rules and regulations thereunder.

     

    AA. NO
      CONFLICT WITH MONEY LAUNDERING LAWS.
      (i) To
      the best of the Company's knowledge, the operations of the Company and its
      Significant Subsidiaries are, and have been conducted at all times, in
      compliance with applicable financial recordkeeping and reporting requirements
      of
      the Currency and Foreign Transactions Reporting Act of 1970, as amended, the
      money laundering statutes of all jurisdictions, the rules and regulations
      thereunder and any related or similar rules, regulations or guidelines, issued,
      administered or enforced by any governmental agency (collectively, the
      "Money
      Laundering Laws")
      and
      (ii) no action, suit or proceeding by or before any court or governmental
      agency, authority or body or any arbitrator involving the Company or any of
      its
      Significant Subsidiaries with respect to the Money Laundering Laws is pending
      or, to the knowledge of the Company, threatened.

     

    BB. NO
      CONFLICT WITH OFAC LAWS.
      Neither
      the Company nor any of its Significant Subsidiaries nor, to the knowledge of
      the
      Company, any director, officer, agent or affiliate of the Company or any of
      its
      Significant Subsidiaries is currently subject to any U.S. sanctions administered
      by the Office of Foreign Assets Control of the U.S. Treasury Department
      ("OFAC");
      and
      the Company will not directly or indirectly use the proceeds of the offering,
      or
      lend, contribute or otherwise make available such proceeds to any subsidiary,
      joint venture partner or other person or entity, for the purpose of financing
      the activities of any person currently subject to any U.S. sanctions
      administered by OFAC.

     

    CC. COMPLIANCE
      WITH ENVIRONMENTAL LAWS.
      The
      Company and each of its subsidiaries are in compliance with any and all
      applicable foreign, federal, state and local laws and regulations relating
      to
      the protection of human health and safety, the environment or hazardous or
      toxic
      substances or wastes, pollutants or contaminants ("Environmental
      Laws"),
      (ii)
      have received all permits, licenses or other approvals required of them under
      applicable Environmental Laws to conduct their respective businesses and (iii)
      are in compliance with all terms and conditions of any such permit, license
      or
      approval, except where such noncompliance with Environmental Laws, failure
      to
      receive required permits, licenses or other approvals or failure to comply
      with
      the terms and conditions of such permits, licenses or approvals would not,
      singly or in the aggregate, have a Material Adverse Effect.

     

    
      
        
        

      

      
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    DD. COSTS
      OF
      ENVIRONMENTAL COMPLIANCE.
      There
      are no costs or liabilities associated with Environmental Laws (including,
      without limitation, any capital or operating expenditures required for clean
      up,
      closure of properties or compliance with Environmental Laws or any permit,
      license or approval, any related constraints on operating activities and any
      potential liabilities to third parties) which would, singly or in the aggregate,
      have a Material Adverse Effect.

     

    EE. NO
      OUTSTANDING LOANS OR OTHER INDEBTEDNESS.
      There
      are no outstanding loans, advances (except normal advances for business expenses
      in the ordinary course of business) or guarantees or indebtedness by the Company
      to or for the benefit of any of the officers or directors of the Company or
      any
      of the members of any of their families, except as disclosed in the SEC
      Reports.

     

    FF. SARBANES-OXLEY
      COMPLIANCE.
      There
      is and has been no failure on the part of the Company, and to the Company's
      knowledge, any of the Company's directors or officers, in their capacities
      as
      such, to comply with the provisions of the Sarbanes-Oxley Act of 2002 and the
      rules and regulations promulgated in connection therewith.

     

    GG. INTERNAL
      CONTROLS AND PROCEDURES.
      The
      Company maintains a system of internal control over financial reporting (as
      such
      term is defined in Rule 13a-15(f) under the 1934 Act) that complies with the
      requirements of the 1934 Act and has been designed by the Company's principal
      executive officer and principal financial officer, or under their supervision,
      to provide reasonable assurance regarding the reliability of financial reporting
      and the preparation of financial statements for external purposes in accordance
      with generally accepted accounting principles. The Company's internal control
      over financial reporting is effective and the Company is not aware of any
      material weaknesses in its internal control over financial reporting. Since
      the
      date of the latest audited financial statements included in the Company's Annual
      Report on Form 10-K for the most recent fiscal year, there has been no change
      in
      the Company's internal control over financial reporting that has materially
      affected, or is reasonably likely to materially affect, the Company's internal
      control over financial reporting.

     

    HH. DISCLOSURE
      CONTROLS.
      The
      Company maintains disclosure controls and procedures (as such term is defined
      in
      Rule 13a-15(e) under the 1934 Act) that comply with the requirements of the
      1934
      Act; such disclosure controls and procedures have been designed to ensure that
      material information relating to the Company and its Significant Subsidiaries
      is
      made known to the Company's principal executive officer and principal financial
      officer by others within those entities; and such disclosure controls and
      procedures are effective to perform the functions for which they were
      established.

     

    
      
        
        

      

      
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    II. STOCK
      OPTIONS.
      Except
      as described in the SEC Reports, with respect to the stock options (the
      "Stock
      Options")
      granted pursuant to the stock-based compensation plans of the Company and its
      subsidiaries (the "Company
      Stock Plans"),
      (i)
      each Stock Option designated by the Company or the relevant subsidiary of the
      Company at the time of grant as an "incentive stock option" under Section 422
      of
      the Code, so qualifies, (ii) each grant of a Stock Option was duly authorized
      no
      later than the date on which the grant of such Stock Option was by its terms
      to
      be effective (the "Grant
      Date")
      by all
      necessary corporate action, including, as applicable, approval by the board
      of
      directors of the Company or the relevant subsidiary of the Company (or a duly
      constituted and authorized committee thereof) and any required stockholder
      approval by the necessary number of votes or written consents, and the award
      agreement governing such grant (if any) was duly executed and delivered by
      each
      party thereto, (iii) each such grant was made in accordance with the terms
      of
      the Company Stock Plans, the 1934 Act and all other applicable laws and
      regulatory rules or requirements, including the rules of the New York Stock
      Exchange and any other exchange on which the securities of the Company or the
      relevant subsidiary of the Company are traded, (iv) the per share exercise
      price
      of each Stock Option was equal to or greater than the fair market value of
      a
      share of Common Stock on the applicable Grant Date and (v) each such grant
      was
      properly accounted for in accordance with GAAP in the consolidated financial
      statements (including the related notes) of the Company and disclosed in the
      Company's filings with the SEC in accordance with the 1934 Act and all other
      applicable laws. Neither the Company nor any of its Significant Subsidiaries
      has
      knowingly granted, and there is no and has been no policy or practice of the
      Company or any of its subsidiaries of granting, Stock Options prior to, or
      otherwise coordinating the grant of Stock Options with, the release or other
      public announcement of material information regarding the Company or its
      subsidiaries or their results of operations or prospects.

     

    JJ. SUBSIDIARIES.
      The
      subsidiaries listed on Schedule 3(JJ) attached hereto are the only significant
      subsidiaries of the Company as defined by Rule 1-02 of Regulation
      S-X.

     

    KK. TAX
      STATUS.
      The
      Company has been, and upon the sale of the Securities pursuant to this Agreement
      will continue to be, organized and operated in conformity with the requirements
      for qualification and taxation as a REIT under the REIT Provisions of the Code,
      for all taxable years commencing with its taxable year of formation. The
      proposed method of operation of the Company as described in the SEC Reports
      will
      enable the Company to continue to meet the requirements for qualification and
      taxation as a REIT under the Code. The Company currently intends to continue
      to
      operate in a manner which would permit it to qualify as a real estate investment
      trust under the Code and no actions have been taken (or not taken which are
      required to be taken) which would cause such qualification to be lost. The
      Company is not currently, and will use its commercially reasonable efforts
      to
      operate in such a manner that it does not to become, a “United States real
      property holding corporation” (a “USRPHC”) as defined in Code Section
      897(c)(2).

     

    LL. RELATED
      PARTY TRANSACTIONS.
      No
      relationship, direct or indirect, exists between or among the Company, on the
      one hand, and the directors, officers, stockholders, customers or suppliers
      of
      the Company, on the other hand, that is required to be described by the 1933
      Act, 1934 Act or the rules and regulations thereunder in the SEC Reports which
      is not so described. The Company is not currently a "pension-held REIT" within
      the meaning of Code Section 856(h)(3)(D) and the Treasury Regulations
      promulgated thereunder.

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    MM. OWNERSHIP
      LIMITATIONS. The Company has taken all actions necessary to exempt (the
“Exemption”) the Buyer, RECP and direct and indirect owners thereof (together,
      the “Exempt Shareholders”) and Qualified Transferees (as defined in Exhibit
      E)
      from
      the ownership limitation set forth in section 6.1.2(a) of the Articles (the
      “Ownership Limit”) with respect to the acquisition and ownership of the Exempted
      Stock (as defined in Exhibit
      E),
      subject the terms and conditions as set forth in that certain letter from the
      Company to Buyer dated the date hereof regarding the Exemption (the “Exemption
      Letter”), in the form attached hereto as Exhibit
      E.

     

    
      
        4.
          COVENANTS.

      

    

     

    A. BEST
      EFFORTS. The parties shall use their reasonable
      best efforts to satisfy timely each of the conditions described in Sections
      5
      and 6 of this Agreement.

     

    B. FORM
      D;
      BLUE SKY LAWS. If required, the Company agrees to file a Form D with respect
      to
      the Securities as required under Regulation D of the 1933 Act and to provide
      a
      copy thereof to each Buyer promptly after such filing. The Company shall take
      such action as the Company shall reasonably determine is necessary to qualify
      the Securities for issuance and sale to the Buyer at the date of issuance
      pursuant to this Agreement under applicable securities or "blue sky" laws of
      the
      states of the United States (or to obtain an exemption from such
      qualification).

     

    C. REPORTING
      STATUS; ELIGIBILITY TO USE FORM S-3. The Common Stock is registered under
      Section 12(g) of the 1934 Act. So long as the Buyer beneficially owns any of
      the
      Securities, the Company shall timely file all reports required to be filed
      with
      the SEC pursuant to Section 13, 14 or 15(d) of the 1934 Act, and the Company
      shall not, so long as the Buyer beneficially owns any of the Securities,
      terminate its status as an issuer required to file reports under the 1934 Act
      even if the 1934 Act or the rules and regulations thereunder would permit such
      termination. The Company currently meets, and, so long as the Buyer beneficially
      owns any of the Securities, will take reasonable action to continue to meet,
      the
      "registrant eligibility" requirements set forth in the general instructions
      to
      Form S-3 under the 1933 Act.

     

    D. RESERVATION
      OF SHARES. The Company shall at all times have authorized, and reserved for
      the
      purpose of issuance, a sufficient number of shares of Common Stock to provide
      for the full conversion of the outstanding Preferred Shares and issuance of
      the
      Conversion Shares in connection therewith.

     

    E. LISTING.
      Following registration thereof under the 1933 Act, the Company shall promptly
      secure the listing of the Conversion Shares upon each national securities
      exchange or automated quotation system, if any, upon which shares of Common
      Stock are then listed (subject to official notice of issuance) and, so long
      as
      the Buyer or its assigns owns any of the Securities, shall maintain, so long
      as
      any other shares of Common Stock shall be so listed, such listing of the
      Conversion Shares.

     

    F. NO
      INTEGRATION. The Company shall not make any offers or sales of any security
      (other than the Securities) under circumstances that would require registration
      of the Securities being offered or sold hereunder under the 1933 Act or cause
      the offering of Securities to be integrated with any other offering of
      securities by the Company for the purpose of any stockholder approval provision
      applicable to the Company or its securities.

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

     

    G. CONSENTS
      AND APPROVALS. No approval, authorization, consent or order of or filing with
      any federal, state or local governmental or regulatory commission, board, body,
      authority or agency is required in connection with (i) the execution, delivery
      and performance by the Company of this Agreement, the Articles Supplementary,
      the Registration Rights Agreement, the consummation of the transactions
      contemplated hereby and thereby or (ii) the sale and delivery of the Preferred
      Shares, other than (x) such as have been obtained, or will have been obtained
      at
      the Closing, under the 1933 Act or the 1934 Act and (y) any necessary
      qualification under the applicable securities or blue sky laws.

     

    H. TAX
      STATUS. The Company (i) will use its best efforts to operate in a manner in
      accordance with the requirements for qualification and taxation as a REIT and
      (ii) will use its commercially reasonable efforts not to become a USRPHC. In
      the
      event of the taking or proposed taking of any action that would cause any
      representation set forth in Section 3(KK) to be incorrect if made as of any
      date
      following the Closing, the Company shall use reasonable efforts to notify the
      undersigned prior to the taking of such action.

     

    I. INVESTMENT
      COMPANY. The Company will conduct its affairs in such a manner so as to ensure
      that the Company is not an "investment company" or an entity subject to
      regulation as an investment company within the meaning of the 1940
      Act.

     

    J. RESERVATION
      OF COMMON SHARES.
      The
      Company shall maintain a reserve from its duly authorized shares of Common
      Stock
      for issuance pursuant to this Agreement and the Articles Supplementary in such
      amount as may be required to fulfill its obligations to issue such Conversion
      Shares under this Agreement and the Articles Supplementary. In the event that
      at
      any time the then authorized shares of Common Stock are insufficient for the
      Company to satisfy its obligations to issue such Conversion Shares under this
      Agreement and the Articles Supplementary, the Company shall promptly take such
      actions as may be required to increase the number of authorized
      shares.

     

    K. SECURITIES
      LAWS DISCLOSURE; PUBLICITY.
      The
      Company shall, at or before 9:00 a.m., New York time, on the first Trading
      Day
      following execution of this Agreement, issue a press release disclosing all
      material terms of the transactions contemplated hereby. On or before April
      7,
      2008, the Company shall file a Current Report on Form 8-K with the SEC (the
      "8-K
      Filing")
      describing the terms of the transactions contemplated by this Agreement and
      including as exhibits to such Current Report on Form 8-K the Operative Documents
      in the form required by the Exchange Act.

     

    L. FIRPTA
      DIVIDENDS. The Company will use its commercially reasonable efforts to notify
      Buyer within 30 days prior to the record date of any dividend which the Company
      believes will be treated as a distribution to stockholders described in Section
      897(h)(1) of the Code (determined without regard to the second sentence in
      said
      section).

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

     

    M. ADDITIONAL
      TAX MATTERS. The Company shall not, unless and until there is a final
“determination” to the contrary within the meaning of Section 1313(a) of the
      Code, (i) treat any of the Preferred Shares as having been issued with a
      redemption premium that is required to be included in taxable income prior
      to the redemption of such Preferred Shares, (ii) treat a failure to adjust
      the
      conversion ratio of any class of Preferred Shares as a constructive distribution
      with respect to such class of Preferred Shares, and (iii) treat
      dividends in arrears with respect to the Preferred Shares as constructively
      received for U.S. federal income purposes if such dividends were not
      declared or paid.

     

    5. CONDITIONS
      TO THE COMPANY'S OBLIGATION TO SELL. The obligation of the Company hereunder
      to
      issue and sell the Preferred Shares to the Buyer at the Closing is subject
      to
      the satisfaction (or waiver), on or before the Closing Date, of each of the
      following conditions thereto, provided that these conditions are for the
      Company's sole benefit and may be waived by the Company at any time in its
      sole
      discretion by prior delivery of written notice of such waiver to the
      Buyer:

     

    A. The
      Buyer
      shall have executed this Agreement and the Registration Rights Agreement, and
      delivered the same to the Company.

     

    B. The
      Buyer
      shall have delivered the Purchase Price in accordance with Section 1(B)
      above.

     

    C. The
      representations and warranties of the Buyer shall be true and correct in all
      material respects as of the date when made and as of the Closing Date as though
      made at that time (except for representations and warranties that speak as
      of a
      particular date and in such case shall be true and correct as of that particular
      date), and the Buyer shall have performed, satisfied and complied in all
      material respects with the covenants, agreements and conditions required by
      this
      Agreement to be performed, satisfied or complied with by the Buyer at or prior
      to the Closing Date.

     

    D. No
      litigation, statute, rule, regulation, executive order, decree, ruling or
      injunction shall have been enacted, entered, promulgated or endorsed by or
      in
      any court or governmental authority of competent jurisdiction or any
      self-regulatory organization having authority over the matters contemplated
      hereby which prohibits the consummation of any of the transactions contemplated
      by this Agreement.

     

    6. CONDITIONS
      TO THE BUYER'S OBLIGATION TO PURCHASE. The obligation of the Buyer hereunder
      to
      purchase the Shares at the Closing is subject to the satisfaction (or waiver),
      on or before the Closing Date, of each of the following conditions, provided
      that these conditions are for the Buyer's sole benefit and may be waived by
      the
      Buyer at any time in its sole discretion by prior delivery of written notice
      by
      the Buyer to the Company:

     

    A. The
      Company shall have executed this Agreement
      and the
      Registration Rights Agreement, substantially in the form attached hereto as
      Exhibit
      D,
      and
      delivered the same to the Buyer and all covenants, agreements and conditions
      contained therein that are required to have been performed or complied with
      on
      or prior to the Closing, shall have been performed or complied with or waived
      in
      writing by the Buyer.

     

    B. The
      Company shall have delivered to the Buyer duly executed certificates
      representing the Shares in accordance with Section 1(B) above.

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

     

    C. The
      Articles Supplementary shall be in substantially the form attached hereto as
      Exhibits
      A,
      B,
      and
C,
      and
      shall have been accepted for filing with the SDAT, and a copy thereof certified
      by the SDAT shall have been made available to the Buyer, and the Articles
      Supplementary shall be in full force and effect without
      modification.

     

    D. The
      representations and warranties of the Company shall be true and correct in
      all
      material respects as of the date when made and as of the Closing Date as though
      made at such time (except for representations and warranties that speak as
      of a
      particular date and in such case shall be true and correct as of that particular
      date) and the Company shall have performed, satisfied and complied in all
      material respects with the covenants, agreements and conditions required by
      this
      Agreement to be performed, satisfied or complied with by the Company at or
      prior
      to the Closing Date.

     

    E. No
      litigation, statute, rule, regulation, executive order, decree, ruling or
      injunction shall have been enacted, entered, promulgated or endorsed by or
      in
      any court or governmental authority of competent jurisdiction or any
      self-regulatory organization having authority over the matters contemplated
      hereby which prohibits the consummation of any of the transactions contemplated
      by this Agreement, nor shall any action, suit or proceeding be pending or
      threatened with respect thereto.

     

    F. Trading
      in the Common Stock on the NYSE shall not have been suspended by the SEC or
      the
      NYSE.

     

    G. The
      Company shall have obtained all requisite consents of or approvals from federal,
      state and any other governmental authority of competent jurisdiction or any
      self-regulatory organization having authority over the matters contemplated
      hereby necessary to consummate the transactions contemplated by this Agreement
      and issue the Securities and permit the utilization of the proceeds of the
      Shares as described herein.

     

    H. There
      shall be no pending (of which an employee of the Company has received service
      or
      notice of process) or threatened action, suit, investigation, litigation or
      proceeding affecting the Company or any of the subsidiaries before any
      Governmental Authority ("Litigation"),
      that
      would be reasonably likely to result in an adverse decision that could (A)
      have
      a Material Adverse Effect or (B) restrain, prevent or impose materially adverse
      conditions upon the transactions contemplated by this Agreement.

     

    I. The
      Buyer
      shall have received the following, addressed to it and in form and substance
      reasonably satisfactory to it:

     

    (i) certified
      copies of the resolutions adopted by the Board of Directors of the Company
      authorizing the execution, delivery and performance of this Agreement, the
      Registration Rights Agreement,
      the
      Articles Supplementary and each of the other agreements, instruments and
      transactions contemplated hereby or thereby including the issuance and sale
      of
      the Securities;

     

    (ii) certified
      copies of the Articles and By-laws of the Company as in effect at the
      Closing;

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

     

    (iii) a
      certificate of the Secretary of the Company dated the Closing Date, as to the
      incumbency and signatures of the officers executing this Agreement and all
      instruments executed pursuant hereto;

     

    (iv) an
      Officer's Certificate, dated as of the Closing Date, of the Company to the
      effect set forth in Sections 6(A) (with respect to performance and compliance
      with the covenants, agreements and conditions of this Agreement), 6(D), 6(G)
      and
      6(H); and

     

    (v) the
      opinion of each of (A) Skadden, Arps, Slate, Meagher & Flom LLP and (B)
      Miles & Stockbridge, P.C., Maryland counsel to the Company, each in a form
      reasonably acceptable to the Buyer and its counsel; and

     

    (vi) a
      tax
      opinion reasonably acceptable to Buyer and its counsel addressed to Buyer from
      Skadden, Arps, Slate, Meagher & Flom LLP, dated as of the Closing Date,
      opining that commencing with the Company's initial taxable year that ended
      on
      December 31, 1998, the Company was organized in conformity with the requirements
      for qualification as a REIT under the Code, and its actual method of operation
      through the Closing Date has enabled, and its proposed method of operation
      will
      enable it to meet the requirements for qualification and taxation as a REIT.
      Such tax opinion shall be based upon customary representations made by the
      Company and the Company’s subsidiaries in an officer’s certificate that is
      reasonably acceptable to Buyer.

     

    J. All
      matters relating to this Agreement, the Registration Right Agreement, the
      Securities and the transactions contemplated hereby and thereby and the legal
      and organizational structure of the Company shall be reasonably satisfactory
      from a legal point of view to the Buyer, and the Buyer shall have received
      such
      additional certificates, legal opinions and other documentation as it may have
      reasonably requested with respect to this Agreement, the Registration Right
      Agreement, the Securities and the transactions contemplated hereby and
      thereby.

     

    K. Andrew
      P.
      Rifkin shall have been appointed to the Company's Board of
      Directors.

     

    7.
      INDEMNIFICATION

     

    A. The
      Company shall indemnify and hold harmless the Buyer and its respective
      directors, officers, employees, agents, affiliates, successors and permitted
      assigns from and against any and all (x) liabilities, losses,
      claims
      or damages ("Loss")
      and (y)
      out-of-pocket expenses, including without limitation reasonable attorneys'
      fees
      and expenses ("Expense")
      incurred by such party in connection with (i) the Company's breach or failure
      to
      perform its obligations and covenants under this Agreement, the Articles
      Supplementary, the Registration Rights Agreement or in connection with the
      enforcement by the Buyer of any of the Company's obligations or covenants
      hereunder or thereunder including the enforcement of this indemnity and (ii)
      any
      breach of any warranty or the inaccuracy of any representation, or
      misrepresentation or omission, made by the Company in this
      Agreement.

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

     

    B. The
      Buyer
      shall indemnify and hold the Company and its trustees, officers, employees,
      agents, affiliates, successors and permitted assigns harmless from and against
      any and all Losses and Expenses incurred by the Company in connection with
      (i)
      the Buyer's breach or failure to perform its obligations under this Agreement,
      or in connection with the enforcement by the Company of any of the Buyer's
      obligations or covenants hereunder or thereunder including the enforcement
      of
      this Indemnity and (ii) any breach of any warranty or the inaccuracy of any
      representation, or misrepresentation or omission, made by the Buyer in this
      Agreement.

     

    C. If
      a
      party believes that any of the persons entitled to indemnification under this
      Section 7 has suffered or incurred any Loss or incurred any Expense, such party
      shall notify the indemnifying party promptly in writing describing such Loss
      or
      Expense, the amount thereof, if known, and the method of computation of such
      Loss or Expense, all with reasonable particularity and containing a reference
      to
      the provisions of this Agreement, the Articles Supplementary, the Registration
      Rights Agreement, or any certificate delivered pursuant hereto in respect of
      which such Loss or Expense shall have occurred; provided, however, that the
      omission by such indemnified party to give notice as provided herein shall
      not
      relieve the indemnifying party of its indemnification obligation under this
      Section 7 except to the extent that such indemnifying party is materially
      prejudiced as a
      result
      of such failure to give notice. If any action at law or suit in equity is
      instituted against a third party with respect to which any of the persons
      entitled to indemnification under this Section 7 intends to claim any liability
      or expense as Loss or Expense under this Section 7, any such person shall
      promptly notify the indemnifying party of such action or suit as specified
      in
      this Section 7(C) and in Section 7(D); provided, however, that the omission
      by
      such indemnified party to give notice as provided herein shall not relieve
      the
      indemnifying party of its indemnification obligation under this Section 7 except
      to the extent that such indemnifying party is materially prejudiced as a result
      of such failure to give notice.

     

    D. In
      the
      event of any claim for indemnification hereunder resulting from or in connection
      with any claim or legal proceeding by a third party, the indemnified persons
      shall give notice thereof to the indemnifying party not later than 20 business
      days prior to the time any response to the asserted claim is required, if
      possible, and in any event within 15 days following the date such indemnified
      person has actual knowledge thereof; provided, however, that the omission by
      such indemnified party to give notice as provided therein shall not relieve
      the
      indemnifying party of its indemnification obligation under this Section 7 except
      to the extent that such indemnifying party suffers a material Loss as a result
      of such failure to give notice. In the event of any such claim for
      indemnification resulting from or in connection with a claim or legal proceeding
      by a third party, the indemnifying party may, at its sole cost and expense,
      assume the defense thereof; provided, however, that counsel for the indemnifying
      party, who shall conduct the defense of such claim or legal proceeding, shall
      be
      reasonably satisfactory to the indemnified party; and provided, further, that
      if
      the defendants in any such actions include both the indemnified persons and
      the
      indemnifying party and the indemnified persons shall have reasonably concluded
      based on a written advice of counsel that there may be legal defenses or rights
      available to them which have not been waived and are in actual or potential
      conflict with those available to the indemnifying party, the indemnified persons
      shall have the right to select one law firm reasonably acceptable to the
      indemnifying party to act as separate counsel, on behalf of such indemnified
      persons, at the expense of the indemnifying party. Unless the indemnified
      persons are represented by separate counsel pursuant to the second proviso
      of
      the immediately preceding sentence, if an indemnifying party assumes the defense
      of any such claim of legal proceeding, such indemnifying party shall not consent
      to entry of any judgment, or enter into any settlement, that (a) is not subject
      to indemnification in accordance with the provisions of this Section 7, (b)
      provides for injunctive or other nonmonetary relief affecting the indemnified
      persons or (c) does not include as an unconditional term thereof the giving
      by
      each claimant or plaintiff to such indemnified persons of an unconditional
      release from all liability with respect to such claim or legal proceeding,
      without the prior written consent of the indemnified person (which consent,
      in
      the case of clauses (b) and (c), shall not be unreasonably withheld); and
      provided, further, that unless the indemnified persons are represented by
      separate counsel pursuant to the second proviso of the immediately preceding
      sentence, the indemnified persons may, at their own expense, participate in
      any
      such proceeding with the counsel of their choice without any right of control
      thereof. So long as the indemnifying party is in good faith defending such
      claim
      or proceeding, the indemnified persons shall not compromise or settle such
      claim
      or proceeding without the prior written consent of the indemnifying party,
      which
      consent shall not be unreasonably withheld. If the indemnifying party does
      not
      assume the defense of any such claim or litigation in accordance with the terms
      hereof, the indemnified persons may defend against such claim or litigation
      in
      such manner as they may deem appropriate, including, without limitation,
      settling such claim or litigation (after giving prior written notice of the
      same
      to the indemnifying party) on such terms as the indemnified persons may deem
      appropriate, and the indemnifying party will promptly indemnify the indemnified
      persons in accordance with the provisions of Section 7.

     

    
      
        
        

      

      
        21

        
          

        

      

      
        
        

      

    

     

    
      
        8.
          GOVERNING
          LAW; MISCELLANEOUS.

      

    

     

    A. GOVERNING
      LAW. This
      Agreement shall be governed by and construed in accordance with the internal
      laws of the State of New York applicable to agreements made and to be performed
      in such state. Any legal suit, action or proceeding arising out of or based
      upon
      this Agreement or the transactions contemplated hereby ("Related
      Proceedings")
      may be
      instituted in the federal courts of the United States of America located in
      the
      Borough of Manhattan in the City of New York or the courts of the State of
      New
      York in each case located in the Borough of Manhattan in the City of New York
      (collectively, the "Specified
      Courts"),
      and
      each party irrevocably submits to the exclusive jurisdiction (except for
      proceedings instituted in regard to the enforcement of a judgment of any such
      court (a "Related
      Judgment"),
      as to
      which such jurisdiction is non-exclusive) of such courts in any such suit,
      action or proceeding. Service of any process, summons, notice or document by
      mail to such party's address set forth above shall be effective service of
      process for any suit, action or other proceeding brought in any such court.
      The
      parties irrevocably and unconditionally waive any objection to the laying of
      venue of any suit, action or other proceeding in the Specified Courts and
      irrevocably and unconditionally waive and agree not to plead or claim in any
      such court that any such suit, action or other proceeding brought in any such
      court has been brought in an inconvenient forum.

     

    B. COUNTERPARTS;
      SIGNATURES BY FACSIMILE. This Agreement may be executed in one or more
      counterparts, all of which shall be considered one and the same agreement and
      shall become effective when counterparts have been signed by each party and
      delivered to the other party. This Agreement, once executed by a party, may
      be
      delivered to the other party hereto by facsimile transmission of a copy of
      this
      Agreement bearing the signature of the party so delivering this
      Agreement.

     

    C. HEADINGS.
      The headings of this Agreement are for convenience of reference only and shall
      not form part of, or affect the interpretation of, this Agreement.

     

    
      
        
        

      

      
        22

        
          

        

      

      
        
        

      

    

     

    D. SEVERABILITY.
      If any provision of this Agreement shall be invalid or unenforceable in any
      jurisdiction, such invalidity or unenforceability shall not affect the validity
      or enforceability of the remainder of this Agreement or the validity or
      enforceability of this Agreement in any other jurisdiction.

     

    E. ENTIRE
      AGREEMENT; AMENDMENTS. This Agreement and the Schedules, Exhibits and
      instruments referenced herein contain the entire understanding of the parties
      with respect to the matters covered herein and therein and, except as
      specifically set forth herein or therein, neither the Company nor the Buyer
      makes any representation, warranty, covenant or undertaking with respect to
      such
      matters. This Agreement supersedes and replaces any understanding of the parties
      reflected in the Equity Investment Letter of Intent, dated March 28, 2008,
      between the Company and RECP, and in the event of any conflict with the terms
      or
      provisions therein, the terms and provisions of this Agreement prevail. No
      provision of this Agreement may be waived other than by an instrument in writing
      signed by the party to be charged with enforcement and no provision of this
      Agreement may be amended other than by an instrument in writing signed by the
      Company and the Buyer. No consideration shall be offered or paid to any person
      to amend or consent to a waiver or modification of any provision of this
      Agreement unless the same consideration also is offered to all the parties
      to
      this Agreement.

     

    F. NOTICES.
      Any notices required or permitted to be given under the terms of this Agreement
      shall be sent overnight by express mail or delivered personally or by courier
      (including an overnight delivery service) or by facsimile and shall be effective
      upon receipt, if delivered by overnight express mail, personally or by courier
      (including an overnight delivery service) or by facsimile, in each case
      addressed to a party. The addresses for such communications shall
      be:

     

     

    If
      to the
      Company:

     

    Anthracite
      Capital, Inc.

    40
      East
      52nd Street

    New
      York,
      New York 10022

    Facsimile
      No.: (212) 810-8765

    Attn:
      Richard M. Shea

     

    With
      copy
      to:

     

    Skadden,
      Arps, Slate, Meagher & Flom LLP

    Four
      Times Square

    New
      York,
      New York 10036

    Facsimile
      No.: (212) 735-2000

    Attn:
      Matthew J. Mallow, Esq.

     

    If
      to the
      Buyer to:

    

    RECP
      IV
      Cite CMBS Equity, L.P.

    c/o
      DLJ
      Real Estate Capital Partners

    Credit
      Suisse

     

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

       

    

    11
      Madison Avenue

    New
      York,
      New York 10010

    Facsimile
      No.: (646) 935-7700

    Attn:
      Bill Helm

     

    With
      copy
      to:

     

    Proskauer
      Rose LLP

    1585
      Broadway

    New
      York,
      NY 10036

    Facsimile
      No.: (212) 969-2900

    Attn:
      Bruce L. Lieb, Esq.

     

    Each
      party shall provide written notice to the other party of any change in
      address.

     

    G. SUCCESSORS
      AND ASSIGNS. This Agreement shall be binding upon and inure to the benefit
      of
      the parties and their successors and assigns. Neither the Company nor the Buyer
      shall assign this Agreement or any rights or obligations hereunder without
      the
      prior written consent of the other; provided, that, subject to Section 2(F),
      the
      Buyer may assign its rights and obligations hereunder to a
      subsidiary of Buyer or to any person that purchases Securities in a private
      transaction from the Buyer or to any of its "affiliates," as that term is
      defined under the 1934 Act, without the consent of the Company; provided,
      further, however, that the transferee has agreed in writing to be bound by
      the
      provisions of this Agreement and acknowledges the assignment provisions of
      the
      Registration Rights Agreement with such transferee becoming a "Buyer" under
      this
      Agreement with all of the rights and obligations the Buyer has hereunder and
      the
      Company shall have been notified of the name and address of the
      transferee.

     

    H. THIRD-PARTY
      BENEFICIARIES. This Agreement is intended for the benefit of the parties hereto
      and their respective permitted successors and assigns, and is not for the
      benefit of, nor may any provision hereof be enforced by, any other
      person.

     

    I. FURTHER
      ASSURANCES. Each party shall do and perform, or cause to be done and performed,
      all such further acts and things, and shall execute and deliver all such other
      agreements, certificates, instruments and documents, as the other party may
      reasonably request in order to carry out the intent and accomplish the purposes
      of this Agreement and the consummation of the transactions contemplated
      hereby.

     

    J. NO
      STRICT
      CONSTRUCTION. The language used in this Agreement shall be deemed to be the
      language chosen by the parties to express their mutual intent, and no rules
      of
      strict construction will be applied against any party.

     

    K. EXPENSES.
      Each of the parties hereto shall pay its own costs and expenses in connection
      with the transactions contemplated hereby, whether or not such transactions
      shall be consummated, except as shall be explicitly provided otherwise in the
      Registration Rights Agreement; provided, however, that the Company will
      reimburse the Buyer upon the earlier of (i) the Closing and (ii) the date this
      Agreement is terminated other than by reason of a default by Buyer for up to
      $75,000 of its expenses and fees related to the transactions contemplated by
      this Agreement, including the reasonable fees of its legal counsel to be
      reflected in an invoice to be delivered to the Company on the Closing
      Date.

     

    
      
        
        

      

      
        24

        
          

        

      

      
        
        

      

    

     

    L. SURVIVAL.
      The agreements and covenants set forth in Sections 3, 4, 7 and 8 shall survive
      the closing hereunder notwithstanding any due diligence investigation conducted
      by or on behalf of the Buyer.

     

    M. KNOWLEDGE
      CLAUSES. As used in this Agreement, the phrases "to the Company's knowledge,"
      "to the knowledge of the Company" and phrases of similar import means the
      knowledge of the Chief Executive Officer, President, any Vice President and
      the
      Chief Financial Officer of the Company, after reasonable investigation and
      inquiry commensurate with that of a reasonable person holding such position
      with
      a public company in the ordinary course of business.

     

    N. VALIDITY.
      If fulfillment of any provision of this Agreement, at the time such fulfillment
      shall be due, shall transcend the limit of validity prescribed by law, then
      the
      obligation to be fulfilled shall be reduced to the limit of such validity;
      and
      if any clause or provision contained in this Agreement operates or would operate
      to invalidate this Agreement, in whole or in part, then such clause or provision
      only shall be held ineffective, as though not herein contained, and the
      remainder of this Agreement shall remain operative and in full force and
      effect.

     

    O. CONFIDENTIALITY.
      The
      Company has provided and may continue to provide certain Confidential
      Information to the Buyer. The Buyer agrees that it will not disclose the
      Confidential Information to any other person except: (i) to its affiliates,
      directors, officers, partners, employees and advisors who need to know the
      information in connection with the transactions described in this Agreement
      or
      compliance with the terms hereof (collectively, the "Authorized
      Representatives"), it being understood that the Buyer shall advise the
      Authorized Representatives of the confidential nature of the Confidential
      Information and shall instruct the Authorized Representatives to maintain the
      confidentiality of such information; and (ii) if required to do so by applicable
      law or regulation or regulatory, administrative or legal process (including,
      without limitation, by oral questions, interrogatories, requests for
      information, subpoena of documents, civil investigative demand or similar
      process or the rules and regulations of the Securities and Exchange Commission
      or any stock exchange having jurisdiction over the Buyer). The Buyer hereby
      confirms that it is aware that the United States securities laws prohibit any
      person who has material non-public information about a company from purchasing
      or selling securities of such company. This provision shall terminate on the
      date that such information is no longer Confidential Information within the
      meaning of this provision.

     

    
      	 	
              (i)

            	
              "Confidential
                Information" shall mean all information disclosed by the Company
                to the
                Buyer or its Authorized Representatives relating to the Company and
                the
                transactions described herein but excludes information that: (i)
                was
                already in the possession of the Buyer or its Authorized Representatives
                before being disclosed by the Company; (ii) is or becomes available
                to the
                public other than as a result of a disclosure by the Buyer or its
                Authorized Representatives in breach of this Agreement; (iii) was
                or is
                developed by the Buyer or its Authorized Representatives without
                the use
                of Confidential Information; or (iv) is or becomes available to the
                Buyer
                or its Authorized Representatives from a third party not known by
                such
                recipient to be in breach of any legal obligation not to disclose
                such
                information.

            

    

     

    
      
        
        

      

      
        25

        
          

        

      

      
        
        

      

    

     

    P. ORDINARY
      COURSE OF BUSINESS. Notwithstanding
      anything in this Agreement to the contrary, neither the Credit Suisse Group
      nor
      any of its affiliates shall be restricted in any way from engaging in any
      brokerage, investment advisory, financial advisory, anti-raid advisory,
      financing, asset management, trading, market making, arbitrage and other similar
      activities conducted in the ordinary course of its business.

     

    Q. DEFINITIONS.

     

    (i)
      "Trading
      Day"
      means
      (i) a day on which the Common Stock is traded on a Trading Market (other than
      the OTC Bulletin Board), or (ii) if the Common Stock is not listed or quoted
      on
      a Trading Market (other than the OTC Bulletin Board), a day on which the Common
      Stock is traded in the over-the-counter market, as reported by the OTC Bulletin
      Board, or (iii) if the Common Stock is not listed or quoted on any Trading
      Market, a day on which the Common Stock is quoted in the over-the-counter market
      as reported by the Pink Sheets LLC (or any similar organization or agency
      succeeding to its functions of reporting prices); provided, that in the event
      that the Common Stock is not listed or quoted as set forth in (i), (ii) and
      (iii) hereof, then Trading Day shall mean a Business Day.

     

    (ii)
      "Trading
      Market"
      means
      whichever of the New York Stock Exchange, the American Stock Exchange, the
      NASDAQ Global Select Market, the NASDAQ Global Market, the NASDAQ Capital Market
      or OTC Bulletin Board on which the Common Stock is listed or quoted for trading
      on the date in question.

    

    
      
        
        

      

      
        26

        
          

        

      

      
        
        

      

    

     

    IN
      WITNESS WHEREOF, the Buyer and the Company have caused this Agreement to be
      duly
      executed as of the date first above written.

     

     

    ANTHRACITE
      CAPITAL, INC.

    

    

    
      	By: 	
              /s/
                Christopher A. Milner

            	
            	 
	 	
              Name:     
                Christopher
                A. Milner

            	 
	 	
              Title        
                Chief
                Executive Officer

            	 

    

    

    
      
        
        

      

      
        27

        
          

        

      

      
        
        

      

    

     

    RECP
      IV
      CITE CMBS EQUITY, L.P.

    

     

    
      
        	By: 	
                /s/
                  James D. Allen

              	
              	 
	 	
                Name:     
                  James D. Allen

              	 
	 	
                Title        
                  Vice President

              

      

    

    

    ADDRESS:        
      c/o
      DLJ
      Real Estate Capital Partners

    Credit
      Suisse

    11
      Madison Avenue

    New
      York,
      New York 10010

    

    

    AGGREGATE
      SUBSCRIPTION AMOUNT: $93,500,000

    Number
      of
      Series E-1 Preferred Shares: 23,375

    Number
      of
      Series E-2 Preferred Shares: 23,375

    Number
      of
      Series E-3 Preferred Shares: 23,375

    Number
      of
      shares of Common Stock: 3,494,021

     

    
      
        
        

      

      
        28

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