Document:

exh10-1.htm

    Exhibit 10.1

     

     

    
      
        

      

      

       

      SECOND
AMENDED AND RESTATED

      WAREHOUSING
CREDIT AND SECURITY AGREEMENT

      

      AMONG

       

      CENTERLINE
MORTGAGE CAPITAL INC.,

       

      a
Delaware corporation

       

      AND

       

      CENTERLINE
MORTGAGE PARTNERS INC.,

       

      a
Delaware corporation

       

      AND

       

      BANK OF
AMERICA, N.A., as Agent

       

      AND

       

      THE
LENDERS PARTY HERETO

       

      Dated as
of September 28, 2009

       

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

    

    
       

      
        
          
             

          

          
            
              	
                      TABLE
      OF CONTENTS

                    
	 
      	 
      	 
      	
                      Page

                    
	 	 	 	 
	
                      1.

                    	 
      	
                      DEFINITIONS

                    	
                      1

                    
	 
      	
                      1.1.

                    	 
      	
                      Defined
      Terms

                    	
                      1

                    
	 
      	
                      1.2.

                    	 
      	
                      Other
      Definitional Provisions

                    	
                      14

                    
	 
      	
                      1.3.

                    	 
      	
                      Accounting
      Principles

                    	
                      15

                    
	
                      2.

                    	 
      	
                      THE
      CREDIT

                    	
                      15

                    
	 
      	
                      2.1.

                    	 
      	
                      The
      Commitment

                    	
                      15

                    
	 
      	
                      2.2.

                    	 
      	
                      Procedures
      for Obtaining Advances

                    	
                      16

                    
	 
      	
                      2.3.

                    	 
      	
                      Notes

                    	
                      16

                    
	 
      	
                      2.4.

                    	 
      	
                      Interest

                    	
                      17

                    
	 
      	
                      2.5.

                    	 
      	
                      Principal
      Payments

                    	
                      17

                    
	 
      	
                      2.6.

                    	 
      	
                      Expiration
      of Commitment

                    	
                      19

                    
	 
      	
                      2.7.

                    	 
      	
                      Payments

                    	
                      20

                    
	 
      	
                      2.8.

                    	 
      	
                      Loan
      Fees

                    	
                      20

                    
	 
      	
                      2.9.

                    	 
      	
                      Reserved

                    	
                      21

                    
	 
      	
                      2.10.

                    	 
      	
                      Increased
      Costs; Capital Requirements

                    	
                      21

                    
	 
      	
                      2.11.

                    	 
      	
                      Taxes

                    	
                      22

                    
	
                      3.

                    	 
      	
                      COLLATERAL

                    	
                      23

                    
	 
      	
                      3.1.

                    	 
      	
                      Grant
      of Security Interest

                    	
                      23

                    
	 
      	
                      3.2.

                    	 
      	
                      Authenticated
      Record

                    	
                      25

                    
	 
      	
                      3.3.

                    	 
      	
                      Release
      of Security Interest in Pledged Assets

                    	
                      25

                    
	 
      	
                      3.4.

                    	 
      	
                      Delivery
      of Collateral Documents

                    	
                      26

                    
	 
      	
                      3.5.

                    	 
      	
                      Collection
      and Servicing Rights

                    	
                      27

                    
	 
      	
                      3.6.

                    	 
      	
                      Return
      or Release of Collateral at End of Commitment

                    	
                      27

                    
	
                      4.

                    	 
      	
                      CONDITIONS
      PRECEDENT

                    	
                      27

                    
	 
      	
                      4.1.

                    	 
      	
                      Initial
      Advance

                    	
                      27

                    
	 
      	
                      4.2.

                    	 
      	
                      Each
      Advance

                    	
                      29

                    
	 
      	
                      4.3.

                    	 
      	
                      Post-Closing
      Deliverables

                    	
                      30

                    
	
                      5.

                    	 
      	
                      REPRESENTATIONS
      AND WARRANTIES

                    	
                      31

                    
	 
      	
                      5.1.

                    	 
      	
                      Organization;
      Good Standing; Subsidiaries

                    	
                      31

                    
	 
      	
                      5.2.

                    	 
      	
                      Authorization
      and Enforceability

                    	
                      31

                    
	 
      	
                      5.3.

                    	 
      	
                      Financial
      Condition

                    	
                      32

                    
	 
      	
                      5.4.

                    	 
      	
                      Litigation

                    	
                      32

                    
	 
      	
                      5.5.

                    	 
      	
                      Compliance
      with Laws

                    	
                      33

                    
	 
      	
                      5.6.

                    	 
      	
                      Regulation
      U and X

                    	
                      33

                    
	 
      	
                      5.7.

                    	 
      	
                      Holding
      Company and Investment Company Act

                    	
                      33

                    
	 
      	
                      5.8.

                    	 
      	
                      Agreements

                    	
                      33

                    
	 
      	
                      5.9.

                    	 
      	
                      Title
      to Properties

                    	
                      33

                    
	 
      	
                      5.10.

                    	 
      	
                      ERISA

                    	
                      33

                    
	 
      	
                      5.11.

                    	 
      	
                      Eligibility

                    	
                      34

                    

            

            

             

            
              
                
                

              

              
                i

                
                  

                

              

               

               

              
                
                

              

            

            
              	 
      	
                      5.12.

                    	 
      	
                      Special
      Representations Concerning Collateral

                    	
                      34

                    
	 
      	
                      5.13.

                    	 
      	
                      Franchises,
      Patents, Copyrights, etc

                    	
                      37

                    
	 
      	
                      5.14.

                    	 
      	
                      Proper
      Names

                    	
                      37

                    
	 
      	
                      5.15.

                    	 
      	
                      Direct
      Benefit From Loans

                    	
                      38

                    
	 
      	
                      5.16.

                    	 
      	
                      Loan
      Documents Do Not Violate Other Documents

                    	
                      38

                    
	 
      	
                      5.17.

                    	 
      	
                      Continuing
      Authority of Authorized Representatives

                    	
                      38

                    
	 
      	
                      5.18.

                    	 
      	
                      Consents
      Not Required

                    	
                      38

                    
	 
      	
                      5.19.

                    	 
      	
                      Material
      Fact Representations

                    	
                      39

                    
	 
      	
                      5.20.

                    	 
      	
                      Place
      of Business

                    	
                      39

                    
	 
      	
                      5.21.

                    	 
      	
                      Tax
      Returns and Payments

                    	
                      39

                    
	 
      	
                      5.22.

                    	 
      	
                      Certain
      Transactions

                    	
                      39

                    
	 
      	
                      5.23.

                    	 
      	
                      No
      Broker or Finder

                    	
                      40

                    
	 
      	
                      5.24.

                    	 
      	
                      Special
      Representations Concerning Servicing Portfolio

                    	
                      40

                    
	 
      	
                      5.25.

                    	 
      	
                      Special
      Representations Concerning FHA Mortgage Loans

                    	
                      40

                    
	 
      	
                      5.26.

                    	 
      	
                      Ownership,
      Subsidiaries and taxpayer identification numbers

                    	
                      41

                    
	 
      	
                      5.27.

                    	 
      	
                      Material
      Adverse Change

                    	
                      41

                    
	 
      	
                      5.28.

                    	 
      	
                      Ongoing
      Representations and Warranties

                    	
                      41

                    
	
                      6.

                    	 
      	
                      AFFIRMATIVE
      COVENANTS

                    	
                      42

                    
	 
      	
                      6.1.

                    	 
      	
                      Payment
      of Notes

                    	
                      42

                    
	 
      	
                      6.2.

                    	 
      	
                      Financial
      Statements and Other Reports

                    	
                      42

                    
	 
      	
                      6.3.

                    	 
      	
                      Maintenance
      of Existence; Conduct of Business

                    	
                      43

                    
	 
      	
                      6.4.

                    	 
      	
                      Compliance
      with Applicable Laws

                    	
                      44

                    
	 
      	
                      6.5.

                    	 
      	
                      Inspection
      of Properties and Books

                    	
                      44

                    
	 
      	
                      6.6.

                    	 
      	
                      Notice

                    	
                      44

                    
	 
      	
                      6.7.

                    	 
      	
                      Payment
      of Debt, Taxes, etc

                    	
                      45

                    
	 
      	
                      6.8.

                    	 
      	
                      Insurance

                    	
                      45

                    
	 
      	
                      6.9.

                    	 
      	
                      Closing
      Instructions

                    	
                      45

                    
	 
      	
                      6.10.

                    	 
      	
                      Other
      Loan Obligations

                    	
                      46

                    
	 
      	
                      6.11.

                    	 
      	
                      Accounts

                    	
                      46

                    
	 
      	
                      6.12.

                    	 
      	
                      Special
      Affirmative Covenants Concerning Collateral

                    	
                      46

                    
	 
      	
                      6.13.

                    	 
      	
                      Appraisals
      of Servicing Portfolio

                    	
                      47

                    
	 
      	
                      6.14.

                    	 
      	
                      Cure
      of Defects in Loan Documents

                    	
                      47

                    
	 
      	
                      6.15.

                    	 
      	
                      Charging
      Accounts

                    	
                      47

                    
	
                      7.

                    	 
      	
                      NEGATIVE
      COVENANTS

                    	
                      48

                    
	 
      	
                      7.1.

                    	 
      	
                      Merger;
      Acquisitions

                    	
                      48

                    
	 
      	
                      7.2.

                    	 
      	
                      Loss
      of Eligibility

                    	
                      48

                    
	 
      	
                      7.3.

                    	 
      	
                      Tangible
      Net Worth (CMC)

                    	
                      48

                    
	 
      	
                      7.4.

                    	 
      	
                      Tangible
      Net Worth (CMP)

                    	
                      48

                    
	 
      	
                      7.5.

                    	 
      	
                      Liquidity
      (CMC)

                    	
                      48

                    
	 
      	
                      7.6.

                    	 
      	
                      Liquidity
      (CMP)

                    	
                      48

                    
	 
      	
                      7.7.

                    	 
      	
                      Limits
      on Corporate Distributions

                    	
                      48

                    
	 
      	
                      7.8.

                    	 
      	
                      Loans
      and Advances

                    	
                      49

                    
	 
      	
                      7.9.

                    	 
      	
                      No
      Investments Except Approved Investments

                    	
                      49

                    
	 
      	
                      7.10.

                    	 
      	
                      Charter
      Documents and Business Termination

                    	
                      49

                    

            

             

             

             

            
              
                
                

              

              
                ii

                
                  

                

              

              
                
                

              

            

            
 

             

            
              	 
      	
                      7.11.

                    	 
      	
                      Reserved

                    	
                      49

                    
	 
      	
                      7.12.

                    	 
      	
                      No
      Sales, Leases or Dispositions of Property

                    	
                      50

                    
	 
      	
                      7.13.

                    	 
      	
                      Changes
      in Business or Assets

                    	
                      50

                    
	 
      	
                      7.14.

                    	 
      	
                      Changes
      in Office Location

                    	
                      50

                    
	 
      	
                      7.15.

                    	 
      	
                      Special
      Negative Covenants Concerning Collateral

                    	
                      50

                    
	 
      	
                      7.16.

                    	 
      	
                      No
      Indebtedness

                    	
                      50

                    
	 
      	
                      7.17.

                    	 
      	
                      No
      Liens

                    	
                      52

                    
	 
      	
                      7.18.

                    	 
      	
                      Pledge
      of Servicing Contracts

                    	
                      53

                    
	 
      	
                      7.19.

                    	 
      	
                      Recourse
      Servicing Contracts

                    	
                      53

                    
	 
      	
                      7.20.

                    	 
      	
                      Gestation
      Agreements

                    	
                      54

                    
	 
      	
                      7.21.

                    	 
      	
                      Minimum
      Servicing Portfolio

                    	
                      54

                    
	 
      	
                      7.22.

                    	 
      	
                      Maximum
      Serviced Loans Delinquencies

                    	
                      54

                    
	 
      	
                      7.23.

                    	 
      	
                      Subsidiaries

                    	
                      54

                    
	
                      8.

                    	 
      	
                      DEFAULTS;
      REMEDIES

                    	
                      54

                    
	 
      	
                      8.1.

                    	 
      	
                      Events
      of Default

                    	
                      54

                    
	 
      	
                      8.2.

                    	 
      	
                      Remedies

                    	
                      57

                    
	 
      	
                      8.3.

                    	 
      	
                      Application
      of Proceeds

                    	
                      61

                    
	 
      	
                      8.4.

                    	 
      	
                      Agent
      Appointed Attorney-in-Fact

                    	
                      61

                    
	 
      	
                      8.5.

                    	 
      	
                      Right
      of Offset

                    	
                      62

                    
	 
      	
                      8.6.

                    	 
      	
                      Waivers

                    	
                      62

                    
	 
      	
                      8.7.

                    	 
      	
                      Performance
      by Agent

                    	
                      62

                    
	 
      	
                      8.8.

                    	 
      	
                      No
      Responsibility

                    	
                      63

                    
	 
      	
                      8.9.

                    	 
      	
                      No
      Waiver

                    	
                      63

                    
	 
      	
                      8.10.

                    	 
      	
                      Cumulative
      Rights

                    	
                      63

                    
	
                      9.

                    	 
      	
                      NOTICES

                    	
                      63

                    
	
                      10.

                    	 
      	
                      REIMBURSEMENT
      OF EXPENSES; INDEMNITY

                    	
                      65

                    
	 
      	
                      10.1.

                    	 
      	
                      Reimbursement
      of Expenses and Indemnification by Borrower

                    	
                      65

                    
	 
      	
                      10.2.

                    	 
      	
                      Indemnification
      by the Borrower

                    	
                      65

                    
	 
      	
                      10.3.

                    	 
      	
                      Indemnification
      by the Lenders

                    	
                      66

                    
	
                      11.

                    	 
      	
                      THE
      AGENT AND THE LENDERS

                    	
                      67

                    
	 
      	
                      11.1.

                    	 
      	
                      Rights,
      Duties and Immunities of the Agent

                    	
                      67

                    
	 
      	
                      11.2.

                    	 
      	
                      Respecting
      Loans and Payments

                    	
                      72

                    
	 
      	
                      11.3.

                    	 
      	
                      Assignment
      and Participation

                    	
                      75

                    
	 
      	
                      11.4.

                    	 
      	
                      Administrative
      Matters

                    	
                      77

                    
	 
      	
                      11.5.

                    	 
      	
                      Commitment
      Increases

                    	
                      79

                    
	 
      	
                      11.6.

                    	 
      	
                      Temporary
      Increases

                    	
                      79

                    
	
                      12.

                    	 
      	
                      MISCELLANEOUS

                    	
                      80

                    
	 
      	
                      12.1.

                    	 
      	
                      Confidentiality

                    	
                      80

                    
	 
      	
                      12.2.

                    	 
      	
                      Governing
      Law

                    	
                      81

                    
	 
      	
                      12.3.

                    	 
      	
                      Relationship
      of the Parties

                    	
                      81

                    
	 
      	
                      12.4.

                    	 
      	
                      Severability

                    	
                      81

                    
	 
      	
                      12.5.

                    	 
      	
                      Usury

                    	
                      82

                    

            

             

             

             

            
              
                
                

              

              
                iii

                
                  

                

              

              
                
                

              

            

            
 

             

            
              	 
      	
                      12.6.

                    	 
      	
                      Consent
      to Jurisdiction

                    	
                      82

                    
	 
      	
                      12.7.

                    	 
      	
                      Additional
      Indemnity

                    	
                      83

                    
	 
      	
                      12.8.

                    	 
      	
                      No
      Waivers Except in Writing

                    	
                      84

                    
	 
      	
                      12.9.

                    	 
      	
                      Waiver
      of Jury Trial

                    	
                      84

                    
	 
      	
                      12.10.

                    	 
      	
                      Multiple
      Counterparts

                    	
                      84

                    
	 
      	
                      12.11.

                    	 
      	
                      No
      Third Party Beneficiaries

                    	
                      84

                    
	 
      	
                      12.12.

                    	 
      	
                      Release
      of Liability

                    	
                      85

                    
	 
      	
                      12.13.

                    	 
      	
                      Patriot
      Act

                    	
                      85

                    
	 
      	
                      12.14.

                    	 
      	
                      Setoff

                    	
                      85

                    
	 
      	
                      12.15.

                    	 
      	
                      Entire
      Agreement; Amendment

                    	
                      86

                    
	 
      	
                      12.16.

                    	 
      	
                      Replacement
      Documentation

                    	
                      86

                    
	 
      	
                      12.17.

                    	 
      	
                      Survival

                    	
                      87

                    
	 
      	
                      12.18.

                    	 
      	
                      Claims
      Against Agent or Lenders

                    	
                      87

                    
	 
      	
                      12.19.

                    	 
      	
                      Obligations
      Absolute

                    	
                      88

                    
	 
      	
                      12.20.

                    	 
      	
                      Time
      Of the Essence

                    	
                      88

                    
	 
      	
                      12.21.

                    	 
      	
                      Monthly
      Statements

                    	
                      88

                    
	 
      	
                      12.22.

                    	 
      	
                      Joint
      and Several Obligations

                    	
                      88

                    
	 
      	
                      12.23.

                    	 
      	
                      Waiver
      and Release

                    	
                      88

                    

            

            

             

          

           

        

         

         

         

         

      

      
        
          
          

        

        
          iv

          
            

          

        

        
          
          

        

      

      

       

      SECOND
AMENDED AND RESTATED

      WAREHOUSING
CREDIT AND SECURITY AGREEMENT

       

       

      This
Second Amended and Restated Warehousing Credit and Security Agreement (this
“Agreement”), is dated as of September 28, 2009, by and among Centerline
Mortgage Capital Inc., a Delaware corporation, Centerline Mortgage Partners
Inc., a Delaware corporation, the lenders from time to time party hereto as
defined on Schedule
1 (together with any successors and assigns thereof, being hereinafter
referred to individually as a “Lender” and collectively as the “Lenders”) and
Bank of America, N.A., in its capacity as one of the Lenders and as agent (it
and its successors in that capacity called the “Agent”) for the
Lenders.

       

      Reference
is hereby made to the following:

       

      WHEREAS,
Centerline Mortgage Capital Inc., Centerline Mortgage Partners Inc., and
Citicorp USA, Inc. entered into that certain Warehousing Credit and Security
Agreement dated as of May 31, 2007 (as amended from time to time, the “Prior
Agreement”);

       

      WHEREAS,
pursuant to an Assignment and Acceptance dated as of December 27, 2007, Bank of
America, N.A. succeeded to Citicorp USA, Inc.’s rights and obligations under the
Prior Agreement;

       

      WHEREAS,
the Lenders, the Agent, Centerline Mortgage Capital Inc. and Centerline Mortgage
Partners Inc. previously amended and restated the Prior Agreement in its
entirety as set forth in that certain Amended and Restated Warehousing Credit
and Security Agreement, dated as of May 30, 2008 (the “First Amended and
Restated Agreement”); and

       

      WHEREAS,
the Lenders, the Agent, Centerline Mortgage Capital Inc. and Centerline Mortgage
Partners Inc. desire to amend and restate the First Amended and Restated
Agreement in its entirety as set forth in this Agreement.

       

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

       

      
        	
                1.

              	
                 DEFINITIONS.

              

      

       

       1.1. Defined
Terms.  Capitalized terms defined below or elsewhere in this
Agreement (including the exhibits hereto) shall have the following
meanings:

       

      “Additional Lender”
means a Person admitted as a Lender under this Agreement by the terms of an
amendment hereto.

       

      “Advance” means a
disbursement by the Lenders under the Commitment pursuant to Article 2 of this
Agreement.

       

      “Advance Date” means,
for any Advance, the date it is disbursed.

       

      “Advance Rate” has the
meaning set forth in Exhibit
B hereof.

       

       

       

       

      
        
          
          

        

        
          Page
1

          
            

          

        

        
          
          

        

      

       

       

      “Advance Request” has
the meaning set forth in Section 2.2(a) hereof.

       

      “Affiliate” of any
Person means (a) any other Person which, directly or indirectly, controls,
is controlled by, or is under common control with such Person or (b) any
other Person who is director or officer (i) of such Person or (ii) of
any Person described in the preceding clause (a).  For purposes
of this definition “control” (including “controlled by” and “under common
control with”) means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of such Person,
whether through the ownership of voting securities, by contract, or otherwise or
owning or possessing the power to vote ten percent (10%) or more of any class of
voting securities of any Person.  Without limiting the generality of
the foregoing, for purposes of this Agreement, Borrower and each of its
respective Subsidiaries shall be deemed to be Affiliates of one
another.

       

      “Agency” means Fannie
Mae, Freddie Mac or Ginnie Mae.

       

      “Agency Security”
means a Mortgage-backed Security issued or guaranteed by any
Agency.

       

      “Agent” means, at any
time, Bank of America, N.A. or its successors acting as agent for Lenders under
the Loan Documents.

       

      “Agreement” means this
Amended and Restated Warehousing Credit and Security Agreement, either as
originally executed or as it may from time to time be supplemented, modified or
amended.

       

      “Applicable Rate”
means, for any day, either (a) the Daily Floating LIBOR Rate for such day, plus
two and three-quarters percent (2.75%), or (b) if the Daily Floating LIBOR Rate
is unavailable (as described in the definition thereof), then the Prime Rate for
such day plus two and three-quarters percent (2.75%).

       

      “Approved Custodian”
means a pool custodian or other Person designated by an Agency or that Agent
deems acceptable, in its reasonable discretion, to hold Mortgage Loans for
inclusion in a Mortgage Pool or to hold Mortgage Loans as agent for an Investor
that has issued a Purchase Commitment for those Mortgage Loans.

       

      “Authorized
Representatives” has the meaning set forth in Section 5.17
hereof.

       

      “Borrower” means CMC
or CMP individually or collectively and jointly and severally.

       

      “Business Day” means
any day excluding Saturday, Sunday and any day on which Agent is closed for
business.  If any day on which a payment is due is not a Business Day,
then the payment shall be due on the next day following which is a Business
Day.  Further, if there is no corresponding day for a payment in the
given calendar month (i.e., there is no “February 30th”), the payment shall
be due on the last Business Day of the calendar month.

       

      “Cash Collateral
Account” means the non-interest bearing demand checking account
established and maintained with, and pledged to, Agent for the benefit of
Lenders into which shall be deposited the proceeds from any sale of
Collateral.

       

       

       

      
        
          
          

        

        
          Page
2

          
            

          

        

        
          
          

        

      

       

      “CCG” means Centerline
Capital Group Inc., a Delaware corporation.

       

      “Change in Control”
means the occurrence of any of the following:

       

      (a)           the
occurrence of any events or circumstances such that any of CMC, CMP or CCG,
either directly or indirectly, shall no longer be controlled by
CHC;

       

      (b)           as
to CHC: (i) any merger or consolidation of CHC with or into any Person or any
sale, transfer or other conveyance, whether direct or indirect, of all or
substantially all of the assets of CHC, on a consolidated basis, in one
transaction or a series of related transactions, if, immediately after giving
effect to such transaction, any Person or group of Persons (within the meaning
of Section 13 or 14 of the Securities Exchange Act) is or becomes the beneficial
owner (within the meaning of Rule 13d-3 promulgated by the SEC under the
Securities Exchange Act) of the common shares representing a majority of the
total voting power on a fully diluted basis of the aggregate outstanding
securities of the transferee or surviving entity normally entitled to vote in
the election of directors, managers, or trustees, as applicable, of the
transferee or surviving entity; (ii) any Person or group of Persons (within the
meaning of Section 13 or 14 of the Securities Exchange Act) (other than Morgan
Stanley & Co. Incorporated in the exercise of any of its rights under that
certain letter agreement effective as of December 27, 2007, with CHC) is or
becomes the beneficial owner (within the meaning of Rule 13d-3 promulgated by
the SEC under the Securities Exchange Act) of the common shares representing a
majority of total voting power of the aggregate outstanding common shares of CHC
normally entitled to vote in the election of directors of CHC; (iii) during any
period of twelve (12) consecutive calendar months, individuals who were
directors or trustees of CHC on the first day of such period (together with any
new directors or trustees whose election by the board of directors or board of
trustees of CHC or whose nomination for election by the stockholders of CHC was
approved by a vote of a majority of the directors  or trustees then
still in office who were either directors at the beginning of such period or
whose election or nomination for election was previously so approved) cease for
any reason to constitute a majority of the board of directors of CHC; or (iv)
any Person becomes entitled to either force a change in the individuals serving
on CHC’s board of directors, or name one or more individuals to serve on CHC’s
board of directors, as a result of such Person’s rights as a holder of any
preferred capital stock of CHC (other than in connection with such rights
arising under the 4.4% Convertible CRA Shares or the 11% Cumulative Convertible
Preferred Shares, Series A-1 (each as described in CHC’s filings as filed with
the SEC from time to time), as in effect on the date hereof); or

       

      (c)           in
the event that CCG issues preferred capital stock creating rights to force any
change in CCG’s board of directors, if any, or management, the exercise of any
such rights resulting in any such forced changes.

       

      “CHC” means Centerline
Holding Company, a Delaware statutory trust.

       

      “CMC” means Centerline
Mortgage Capital Inc., a Delaware corporation, a Borrower
hereunder.

       

      “CMP” means Centerline
Mortgage Partners Inc., a Delaware corporation, a Borrower
hereunder.

       

       

       

       

      
        
          
          

        

        
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      “Closing Date” means
the date of this Agreement.

       

      “Collateral” has the
meaning set forth in Section 3.1 hereof.

       

      “Collateral Documents”
means all of the documents and other items described on Exhibit C
hereto and required to be delivered to the Agent in connection with an
Advance.

       

      “Collateral Value”
means, as of any date of determination, (a) with respect to any Eligible
Loan, the lesser of (1) the amount of the Advance permitted against such
Eligible Loan under Exhibit
B or (2) the Fair Market Value of such Eligible Loan; and
(b) if Eligible Loans have been exchanged for Agency Securities, the lesser
of (1) the amount of any Advances outstanding against the Eligible Loans
backing the Agency Securities or (2) the Fair Market Value of the Agency
Securities.

       

      “Commitment” means the
commitment of the Lenders to make Advances hereunder in an aggregate principal
amount at any time outstanding that shall not exceed an amount equal to ONE
HUNDRED MILLION AND NO/100 DOLLARS ($100,000,000.00), subject to any increases
or decreases of such amount pursuant to the terms of this Agreement; provided, however, that no
Lender’s portion of such Advances may ever exceed its Commitment
Amount.

       

      “Commitment Amount”
means, with respect to each Lender, the amount set forth opposite its name and
so designated on Schedule
1 hereto, as the same may be amended and as that amount may be canceled
or terminated under this Agreement.

       

      “Commitment
Percentage” means, at any time, for any Lender, the proportion (stated as
a percentage) that its Commitment Amount bears to the total Commitment subject
to any adjustment by the Agent pursuant to the terms of this
Agreement.

       

      “Committed Purchase
Price” means for an Eligible Loan (a) the dollar price as set forth
in the Purchase Commitment or, if the price is not expressed in dollars, the
product of the Mortgage Note Amount multiplied by the price (expressed as a
percentage) as set forth in a Purchase Commitment for the Eligible Loan, or
(b) if the Eligible Loan is to be used to back an Agency Security, the
product of the Mortgage Note Amount multiplied by the price (expressed as a
percentage) as set forth in a Purchase Commitment for the Agency
Security.

       

      “Compliance’s
Certificate” means a certificate executed on behalf of the Borrower by
its chief financial officer or its treasurer or by such other officer as may be
designated herein, in substantially the form of Exhibit D
hereto.

       

      “Constituent
Documents” means, with respect to any Person, its articles or certificate
of incorporation, constitution, bylaws, partnership agreements, organizational
documents, limited liability company agreements, or such other document as may
govern such entity’s formation or organization.

       

      “Daily Floating LIBOR
Rate” means, for each day, the rate per annum equal to the British
Bankers Association LIBOR Rate (“BBA LIBOR”), as
published by Bloomberg (or other commercially available source providing
quotations of BBA LIBOR as designated by the Agent from time to time) at
approximately 11:00 a.m. (London time) on such day (if such day is a LIBOR
Business Day) or the immediately preceding LIBOR Business Day (if such day is
not a LIBOR Business Day), for U.S. dollar deposits with a term equivalent to
one (1) month.  If such rate is not available at such time for any
reason, then the “Daily Floating LIBOR Rate” shall be the rate per annum
determined by the Agent to be the rate at which deposits in U.S. dollars in same
day funds in the approximate amount of the then outstanding principal balance of
the Advances and with a term equivalent to one (1) month would be offered by the
Agent’s London Branch to major banks in the London interbank eurodollar market
at their request at approximately 11:00 a.m. (London time) on such day (if such
day is a LIBOR Business Day) or the immediately preceding LIBOR Business Day (if
such day is not a LIBOR Business Day).  If at any time the Agent’s
London branch is not offering such rate, the Daily Floating LIBOR Rate shall be
deemed to be unavailable.  As used herein, “LIBOR Business Day”
means a Business Day upon which commercial banks in London, England are open for
domestic and international business.

       

       

       

       

      
        
          
          

        

        
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      “Default” means the
occurrence of any event or existence of any condition which, but for the giving
of Notice, the lapse of time, or both, would constitute an Event of
Default.

       

      “Deficiency” has the
meaning set forth in Section 2.5(d) hereof.

       

      “Default Rate” has the
meaning set forth in Section 2.4(c) hereof.

       

      “Delinquent Lender”
has the meaning set forth in Section 11.2(g) hereof.

       

      “DUS Program” means
Fannie Mae’s Delegated Underwriting and Servicing Program.

       

      “Eligible Assignee”
means (a) a Lender, (b) an Affiliate of any Lender, and (c) any other Person
approved by the Agent, which approval will not be unreasonably withheld,
conditioned or delayed.

       

      “Eligible Loan” means
a Mortgage Loan that satisfies the conditions and requirements of Exhibit
B and other applicable provisions of this Agreement for supporting an
Advance.

       

      “Eligible Mortgage
Pool” means a Mortgage Pool for which (a) an Approved Custodian has
issued its initial certification (on the basis of which an Agency Security is to
be issued), (b) there exists a Purchase Commitment covering the related
Agency Security, and (c) such Agency Security will be delivered to the
Agent.

       

      “ERISA” means the
Employee Retirement Income Security Act of 1974 and all rules and regulations
promulgated thereunder, as amended from time to time and any successor
statute.

       

      “ERISA Plan” has the
meaning set forth in Section 5.10 hereof.

       

      “Event of Default”
means the occurrence of any of the conditions or events set forth in
Section 8.1 hereof.

       

      “Exchange Act” means
the Securities Exchange Act of 1934, as amended from time to time and any
successor statute.

       

       

       

      
        
          
          

        

        
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      “Fair Market Value”
means, at any time for an Eligible Loan or a related Agency Security (if the
Eligible Loan is to be used to back an Agency Security) as of any date of
determination, (a) the Committed Purchase Price if the Eligible Loan is
covered by a Purchase Commitment from Fannie Mae or Freddie Mac or the Eligible
Loan is to be exchanged for an Agency Security and that Agency Security is
covered by a Purchase Commitment from an Investor, or (b) otherwise, the
market price for such Eligible Loan or Agency Security, determined by Agent
based on market data for similar Mortgage Loans or Agency Securities and such
other criteria as Agent deems appropriate in its sole discretion.

       

      “Fannie Mae” means the
Federal National Mortgage Association, a corporation created under the laws of
the United States, and any successor thereto.

       

      “Fannie Mae DUS Mortgage
Loan” means a permanent Mortgage Loan on a Multifamily Property or other
Mortgaged Property originated in compliance with Fannie Mae’s DUS
Program.

       

      “Fannie Mae Loan Loss
Reserves” means reserves established by the Borrower to absorb estimated
future losses related to Fannie Mae DUS Mortgage Loans sold by the Borrower to
Fannie Mae.

       

      “Fannie Mae Reserve
Account” means that certain lender reserve account established in favor
of Fannie Mae by the Borrower and maintained at US Bank pursuant to that certain
the Amended and Restated Fannie Mae Delegated Underwriting and Servicing Master
Loss Sharing Agreement dated as of September 30, 2005 by and among Fannie Mae,
the Borrower and US Bank, as amended and in effect.

       

      “Fee Letter” means
that certain letter agreement of even date herewith between the Borrower and the
Agent.

       

      “FHA” means the
Federal Housing Administration and any successor thereto.

       

      “FHA Construction Mortgage
Loan” means a FHA fully insured Mortgage Loan for the construction or
rehabilitation of either (a) a Multifamily Property or other Mortgaged Property,
or (b) as described in Section 232 of the National Housing Act (12 U.S.C.
1715w), a nursing home, intermediate care facility, board and care home, or
assisted-living facility, in either case, originated in compliance with FHA
requirements applicable to such Mortgage Loan.

       

      “FHA Project Mortgage
Loan” means a FHA fully insured Multifamily Mortgage Loan or other
Mortgaged Property originated in compliance with FHA requirements applicable to
such Mortgage Loan.

       

      “Freddie Mac” means
the Federal Home Loan Mortgage Corporation, a corporation created under the laws
of the United States, and any successor thereto.

       

      “Freddie Mac Loan”
means a permanent Mortgage Loan on a Multifamily Property or other Mortgaged
Property originated in compliance with Freddie Mac’s Program Plus Guide or
shared risk program.

       

       

      
        
          
          

        

        
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      “FICA” means the
Federal Insurance Contributions Act or any successor statute.

       

      “First Mortgage” means
a Mortgage that constitutes a first Lien on the real property covered by the
Mortgage.

       

      “First Mortgage Loan”
means a Mortgage Loan secured by a First Mortgage.

       

      “Funding Account”
means the non-interest bearing demand checking account established with,
maintained by, and pledged to Agent for the benefit of Lenders into which shall
be deposited the proceeds of Advances, and from which funds shall be disbursed
for the funding or acquisition of Mortgage Loans.

       

      “Future Commitment”
has the meaning set forth in Section 11.2(g) hereof.

       

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

       

      “Gestation Agreement”
means an agreement between the Borrower and any Person under which the Borrower
agrees to sell or finance (a) a Pledged Loan prior to the date of purchase
by an Investor, or (b) a Mortgage Pool prior to the date the Agency
Security is issued.

       

      “Ginnie Mae” means the
Government National Mortgage Association and any successor thereto.

       

      “Hedging Arrangement”
means an arrangement designed to protect a Person from fluctuations in interest
rates or asset values and not acquired by a Person for speculation.

       

      “HUD” means the
Department of Housing and Urban Development and any successor
thereto.

       

      “Indebtedness” means
all obligations, contingent and otherwise, that in accordance with GAAP should
be classified upon the consolidated balance sheet of the Borrower and the
Borrower’s Subsidiaries as liabilities, including in any event and whether or
not so classified: (a) all obligations for borrowed money or other
extensions of credit whether or not secured or unsecured, absolute or
contingent, including, without limitation, unmatured reimbursement obligations
with respect to letters of credit or guarantees issued for the account of or on
behalf of the Borrower and its Subsidiaries and all obligations representing the
deferred purchase price of property, (b) all obligations evidenced by
bonds, notes, debentures or other similar instruments; (c) all liabilities
secured by any mortgage, pledge, security interest, lien, charge, or other
encumbrance existing on property owned or acquired subject thereto, whether or
not the liability secured thereby shall have been assumed; and (d) all
guarantees, endorsements and other contingent obligations whether direct or
indirect in respect of indebtedness of others, including any obligations with
respect to puts, swaps, and other similar undertakings, any obligation to supply
funds to or in any manner to invest in, directly or indirectly, the debtor, to
purchase indebtedness, or to assure the owner of indebtedness against loss,
through an agreement to purchase goods, supplies, or services for the purpose of
enabling the debtor to make payment of the indebtedness held by such owner or
otherwise, and the obligations to reimburse the issuer in respect of any letters
of credit; and (e) that portion of all obligations arising under capital
leases that is required to be capitalized on the consolidated balance sheet of
the Borrower and its Subsidiaries; but excluding, in all events obligations
arising under operating leases and accounts payable arising in the ordinary
course of business, loan loss reserves, and deferred taxes.

       

       

      
        
          
          

        

        
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7

          
            

          

        

        
          
          

        

      

       

       

      “Indemnified
Liabilities” has the meaning set forth in Article 10
hereof.

       

      “Information” has the
meaning set forth in Section 12.1 hereof.

       

      “Interim Date” has the
meaning set forth in Section 4.3(b) hereof.

       

      “Internal Revenue
Code” means the Internal Revenue Code of 1986, or any subsequent federal
income tax law or laws, as any of the foregoing have been or may from time to
time be amended.

       

      “Investment” means the
acquisition of any real or tangible personal property or of any stock or other
security, any loan, advance, bank deposit, money market fund, contribution to
capital, extension of credit (except for accounts receivable arising in the
ordinary course of business and payable in accordance with customary terms), or
purchase or commitment or option to purchase or otherwise acquire real estate or
tangible personal property or stock or other securities of any party or any part
of the business or assets comprising such business, or any part thereof, but
excluding Mortgage Loans, Agency Securities, and any real property acquired on
exercise of rights under a Mortgage Loan.

       

      “Investor” means any
of the entities listed on Exhibit
G attached hereto, which list may be amended from time to time by the
Agent to reflect the elimination or addition of certain approved
Investors.  Absent manifest error, the Agent’s records indentifying
these Investors and reflecting those Investors which have, from time to time,
been removed from, or added to, Exhibit
G shall be conclusive.  The Agent may from time to time, and,
at the reasonably request of the Borrower, shall, create an updated Exhibit
G reflecting the then current Investors and furnish such updated list to
the Borrowers at the address provided in Section 9 hereof.

       

      “Late Charge” has the
meaning set forth in Section 2.4(d) hereof.

       

      “Lender” has the
meaning set forth in the first paragraph of this Agreement.

       

      “Legal Requirements”
shall mean all applicable federal, state, county and local laws, by-laws, rules,
regulations, codes and ordinances, and the requirements of any governmental
agency or authority having or claiming jurisdiction with respect thereto,
including, but not limited to, those applicable to any Pledged Assets, Fannie
Mae, FHA, Freddie Mac, Ginnie Mae, zoning, subdivision, building, health, fire,
safety, sanitation, the protection of the handicapped, and environmental matters
and shall also include all orders and directives of any court, governmental
agency or authority having or claiming jurisdiction with respect
thereto.

       

       

       

      
        
          
          

        

        
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8

          
            

          

        

        
          
          

        

      

       

       

      “Lien” means any lien,
mortgage, deed of trust, pledge, security interest, charge or encumbrance of any
kind (including any conditional sale or other title retention agreement, any
lease in the nature thereof, and any agreement to give any security
interest).

       

      “Loan” has the meaning
set forth in Section 2.1(a) hereof.

       

      “Loan Documents” means
this Agreement, the Notes, and each other document, instrument or agreement
executed by the Borrower or any other Person in connection herewith or
therewith, as any of the same may be amended, restated, renewed or replaced from
time to time.

       

      “Majority Lenders”
means, at any date, the Lenders whose Commitment Amounts in the aggregate, total
at least fifty-one percent (51%) of the Commitment; provided, however, that if
at any time there are only two Lenders, Majority Lenders means all of the
Lenders.  A Delinquent Lender and its Commitment Amount shall be
disregarded for purposes of determining Majority Lenders.

       

      “Master Credit
Agreement” means any agreement between Borrower and one or mortgagors
under which Borrower makes Special Fannie Mae Mortgage Loans to those mortgagors
secured by Mortgages on Multifamily Properties.

       

      “Material Adverse
Change” means a material adverse change (a) in the financial condition,
business, affairs or operations of the Borrower, CHC or CCG, (b) with respect to
the value of a material portion of the Collateral, or (c) affecting the validity
and enforceability of this Agreement or the Loan Documents against the Borrower,
which, in each case, is reasonably likely to or, for purposes of Sections
4.1(l), 4.2(f) and 8.1(q), in Agent’s reasonable judgment may, jeopardize the
ability of the Borrower to pay or perform the Obligations.

       

      “Maturity Date” means
the earlier of September 27, 2010 or the date upon which the whole of the
Commitments are terminated or the Loan is accelerated in accordance with
applicable provisions of this Agreement.

       

      “Maximum Rate” has the
meaning set forth in Section 13.9 hereof.

       

      “Mortgage” means a
mortgage, deed of trust, deed to secure debt or other form of mortgage
instrument, appropriate and effective for the U.S. jurisdiction where the real
estate is located to create, perfect and maintain in full force and effect a
first or second or third, as permitted by any Agency in connection with its
Purchase Commitment of any Eligible Loan, priority mortgage lien against it,
securing a Mortgage Note and granting a perfected first or second or third, as
permitted by any Agency in connection with its Purchase Commitment of any
Eligible Loan, priority lien on real, personal, or mixed property consisting of
land, improvements and other property more particularly described
therein.

       

      “Mortgage-backed
Securities” means securities that are secured or otherwise backed by
Mortgage Loans.

       

      “Mortgage Loan” means
any loan evidenced by a Mortgage Note.

       

      “Mortgage Note” means
a note secured by a Mortgage.

       

       

      
        
          
          

        

        
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      “Mortgage Note Amount”
means, as of the date of determination, the then outstanding unpaid principal
amount of a Mortgage Note.

       

      “Mortgage Pool” means
a pool of Mortgage Loans that were warehoused with the Agent, on the basis of
which there is to be issued a Mortgage-backed Security.

       

      “Mortgaged Property”
means the property, real, personal, tangible or intangible, securing a Mortgage
Note.

       

      “Multiemployer Plan”
means a “multiemployer plan” as defined in Section 4001(a)(3) of ERISA that
is maintained for employees of the Borrower or a Subsidiary of the
Borrower.

       

      “Multifamily Mortgage
Loan” means a Mortgage Loan secured by a Mortgage on improved Multifamily
Property.

       

      “Multifamily Property”
means real property containing or which will contain more than four (4) dwelling
units and as more particularly defined by the regulations promulgated by
HUD.

       

      “Note” means any
promissory note delivered by Borrower to a Lender, Eligible Assignee, Additional
Lender or Increase Lender pursuant to Section 2.3, Section 11.3 or
Section 11.5 hereof, each in the form attached hereto as Exhibit E, and
any promissory note delivered by Borrower to a Lender in connection with a
Temporary Increase, each in substantially the form attached hereto as Exhibit A to Exhibit H-2 (with
such changes as the Agent, in its sole discretion, shall deem necessary),
together with all renewals, modifications and extensions thereof.

       

      “Notices” has the
meaning set forth in Article 9 hereof.

       

      “Obligations” means
any and all indebtedness, obligations, and liabilities of the Borrower to each
Lender and the Agent (whether now existing or hereafter arising, voluntary or
involuntary, whether or not jointly owed with others, direct or indirect,
absolute or contingent, liquidated or unliquidated, and whether or not from time
to time decreased or extinguished and later increased, created or incurred),
arising out of or related to the Loan Documents, or any of them, and any
renewals, extensions, modifications, enlargements, reinstatements or
rearrangements thereof, and for Automated Clearing House exposure and
liabilities and obligations under the Borrower’s other cash management
arrangements and account agreements with the Agent or a Lender, and under
any Hedging Arrangements between the Borrower and the Agent or any Lender (or
any Affiliate of the Agent or any Lender) solely with respect to Advances made
hereunder.

       

      “Operating Account”
means a demand deposit account maintained at Agent in the name of the Borrower
to be charged from time to time for payment of the Obligations, and designated
for funding that portion of each Eligible Loan not funded by an Advance made
against that Eligible Loan and for returning any excess payment from an Investor
for a Pledged Asset.

       

      “Other Fannie Mae Mortgage
Loan” means a permanent Mortgage Loan on a Multifamily Property or other
Mortgaged Property in compliance with and covered by a Purchase Commitment
issued by Fannie Mae (other than a Fannie Mae DUS Mortgage Loan or a Special
Fannie Mae Mortgage Loan).

       

       

       

      
        
          
          

        

        
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10

          
            

          

        

        
          
          

        

      

       

       

      “Permitted Intercompany
Subordinated Debt” means indebtedness owed by the Borrower and/or one or
more of its Subsidiaries to an Affiliate (other than one another), which
indebtedness has a maturity date which is later than the Maturity Date, and
which is subordinate to the Obligations pursuant to a subordination agreement
reasonably satisfactory to the Agent.

       

      “Person” means and
includes natural persons, corporations, limited partnerships, general
partnerships, joint stock companies, joint ventures, associations, companies,
trusts, banks, trust companies, land trusts, business trusts or other
organizations, whether or not legal entities, and federal and state governments
and agencies or regulatory authorities and political subdivisions
thereof.

       

      “Pledged Assets”
means, collectively, Pledged Loans and Pledged Securities.

       

      “Pledged Hedging
Accounts” has the meaning set forth in Section 3.1(h)
hereof.

       

      “Pledged Hedging
Arrangement” has the meaning set forth in Section 3.1(h)
hereof.

       

      “Pledged Loans” has
the meaning set forth in Section 3.1(b) hereof.

       

      “Pledged Securities”
has the meaning set forth in Section 3.1(c) hereof.

       

      “Prepaid Principal”
has the meaning set forth in Section 2.5(b) hereof.

       

      “Prime Rate” means the
per annum rate of interest so designated from time to time by the Agent as its
prime rate.  The Prime Rate is a reference rate and does not
necessarily represent the lowest or best rate being charged to any
customer.  Changes in the Prime Rate shall be effective on the date
the Agent announces a change in its “prime” or “base” rate.

       

      “Purchase Commitment”
a written commitment, in form and substance reasonably satisfactory to Agent,
issued in favor of any the Borrower by an Investor under which that Investor
commits to purchase Pledged Assets.

       

      “Rating Agencies”
means Standard & Poor’s, Moodys, or any other nationally recognized Person
reasonably acceptable to Agent in the business of rating
creditworthiness.

       

      “Receivables” has the
meaning set forth in Section 3.1(g) hereof.

       

      “Release Amount” has
the meaning set forth in Section 3.3(f) hereof.

       

      “Register” has the
meaning set forth in Section 11.3(b) hereof.

       

      “SEC” means the United
States Securities and Exchange Commission, or any governmental authority
succeeding to any or all of the functions of the United States Securities and
Exchange Commission.

       

       

       

      
        
          
          

        

        
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11

          
            

          

        

        
          
          

        

      

       

       

      “Serviced Loans” means
each of those loans secured by a mortgage lien on a multi-family residential
property, health care facility, senior citizen facility or other property, with
respect to which the Borrower provides servicing or subservicing (but only if
such subservicing is technically styled as subservicing but is performed under a
contract directly between the Borrower and Fannie Mae, Freddie Mac or Ginnie
Mae) pursuant to a Servicing Contract.

       

      “Servicing Contract”
means each direct agreement with the owner of the subject Serviced Loans, as it
may be amended from time to time, pursuant to which the Borrower services
Serviced Loans.

       

      “Servicing Portfolio”
means the portfolio of Servicing Contracts pursuant to which the Borrower has
the rights to service Serviced Loans.

       

      “Servicing Rights”
means all rights of the Borrower as a servicer or subservicer (but only if such
subservicing is technically styled as subservicing but is performed under a
contract directly between the Borrower and Fannie Mae, Freddie Mac or Ginnie
Mae) of Serviced Loans.

       

      “Special Fannie Mae Mortgage
Loan” means a permanent Mortgage Loan on one or more Multifamily
Properties originated by Borrower under a Master Credit Facility Agreement and
evidenced by one or more Mortgage Notes in the possession of Fannie
Mae.

       

      “Statement Date” has
the meaning set forth in Section 4.3(b) hereof.

       

      “Subordinated Debt”
means, with respect to any Person, all Indebtedness of such Person, for borrowed
money, which is, by its terms (which terms shall have been approved by the
Majority Lenders) or by the terms of a subordination agreement, in form and
substance satisfactory to the Majority Lenders, effectively subordinated in
right of payment to the Obligations.

       

      “Subsidiary” means any
corporation, association or other business entity in which more than fifty
percent (50%) of the total voting power or shares of stock entitled to vote in
the election of directors, managers or trustees thereof is at the time owned or
controlled, directly or indirectly, by any Person or one or more of the other
Subsidiaries of that Person or a combination thereof.

       

      “Tangible Net Worth”
means, as to the Borrower (on a non-consolidated basis), as of the date of
determination, the excess of such Persons’ Total Assets over Total Liabilities,
MINUS intangible assets, PLUS, to the extent not otherwise included in
determining “Tangible Net Worth” (i) Fannie Mae Loan Loss Reserves,
(ii) Servicing Contracts valued at the lesser of book value or fair market
value, and (iii) any Permitted Intercompany Subordinated
Debt.  For purposes of calculating the Tangible Net Worth of the
Borrower and its Subsidiaries, advances or loans to shareholders, directors,
officers, employees or Affiliates, investments in Affiliates, assets pledged to
secure any liabilities not included in the Indebtedness of such Persons,
intangible assets, those other assets that would be deemed by HUD to be
non-acceptable in calculating adjusted net worth in accordance with its
requirements in effect as of that date, as those requirements appear in
“Consolidated Audit Guide for Audits of HUD Programs,” and other assets Agent
deems unacceptable, in its sole discretion, shall be excluded from such Person’s
Total Assets.

       

       

       

      
        
          
          

        

        
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12

          
            

          

        

        
          
          

        

      

       

       

      “Temporary Increase”
has the meaning set forth in Section 11.6(a) hereof.

       

      “Total Assets” means,
at the time of determination, all assets of the Borrower (on a non-consolidated
basis) determined in accordance with GAAP applied in a manner consistent with
the most recent audited financial statements delivered pursuant to the
Agreement.

       

      “Total Liabilities”
means as to the Borrower (on a non-consolidated basis), as of the date of
determination, all liabilities of the Borrower determined in accordance with
GAAP applied in a manner consistent with the most recent audited financial
statements delivered pursuant to the Agreement and, whether or not so
classified, all redemption obligations, and off-balance sheet financial
transactions as to which there is recourse to the Borrower.

       

      “Trust Receipt” means
a trust receipt in a form approved by the Agent and pursuant to which the Agent
may deliver any document relating to the Collateral to the Borrower for
correction or completion.

       

      “UCC” means the
Uniform Commercial Code in effect in the state of New York, or any other
applicable jurisdiction.

       

      1.2. Other Definitional
Provisions.  Unless otherwise specified in the Loan
Documents:

       

      
        
          (a)    References
in a Loan Document to “Sections,” “Exhibits,” and “Schedules” are to sections,
exhibits, and schedules in and to such Loan Document.

           

          (b)    References
in a Loan Document to any document, instrument, or agreement (i) shall include
all exhibits, schedules, and other attachments thereto, (ii) shall include all
documents, instruments, or agreements issued or executed in replacement or
restatement thereof, to the extent permitted hereby, and (iii) shall mean such
document, instrument, or agreement, or replacement or predecessor thereto, as
amended, supplemented, restated, or otherwise modified from time to time to the
extent permitted hereby and in effect at any given time.

           

          (c)    Wherever
from the context it appears appropriate, each term stated in either the singular
or plural shall include the singular and plural, and pronouns stated in the
masculine, feminine, or neuter gender shall include the masculine, the feminine,
and the neuter.

           

          (d)    Unless
explicitly set forth to the contrary, a reference to a “Subsidiary” means a
Subsidiary of the Borrower or a Subsidiary of such Subsidiary, and a reference
to an “Affiliate” means a reference to an Affiliate of the
Borrower.

           

          (e)    Titles
and captions of Sections, subsections, and clauses in any Loan Document are for
convenience only, and neither limit nor amplify the provisions of such Loan
Document.

           

          (f)     Unless
otherwise indicated, all references to time are references to Boston,
Massachusetts, time.

           

          (g)    All
references to money or dollars (including the symbol “$”) are to lawful currency
of the United States.

           

           

           

          
            
              
              

            

            
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          (h)    References
to “including” mean including without limiting the generality of any description
preceding that word.

           

          (i)    The rule
of construction providing that references to general items following references
to specific items are limited to the same type or character of those specific
items is not applicable in the Loan Documents.

           

          (j)    References
to any Person include that Person’s heirs, personal representatives, successors,
trustees, receivers, and permitted assigns.

           

          (k)    References
to any Legal Requirement include every amendment or supplement to it, rule and
regulation adopted under it, and successor or replacement for it.

           

          (l)    References
in any of the Loan Documents to any property being pledged to the Agent or any
Liens or security interests being granted to or held by the Agent (or required
so to be) shall mean, respectively, pledged to, granted to or held by Agent for
itself as Lender and as agent for the other Lenders.

           

        

      

       

      1.3.       Accounting
Principles.  All accounting and financial terms used in the
Loan Documents and the compliance with each financial covenant therein shall be
determined in accordance with GAAP, and all accounting principles shall be
applied on a consistent basis so that the accounting principles in a current
period are comparable in all material respects to those applied during the
preceding comparable period.  The Borrower shall notify the Agent of
any change in GAAP from that in effect on the date hereof which would in any way
effect the operation of any covenant in any Loan Documents, whereupon, the Agent
and the Borrower shall attempt for a reasonable period (not to exceed ten (10)
Business Days unless the Agent and the Borrower agrees to extend such time
period) to agree upon appropriate amendments to the affected covenants to
eliminate such effect and to produce equivalent results, failing which, for
purposes of calculating such financial covenants, GAAP will mean generally
accepted accounting principles on the date just prior to the date on which any
such change in GAAP became effective.

       

      2. THE
CREDIT.

       

      2.1.       The
Commitment.

       

      (a)   Subject
to the terms and conditions of this Agreement and provided no Default or Event
of Default has occurred and is continuing, each Lender severally and not jointly
agrees, from time to time during the period from the date hereof up to, but not
including the Maturity Date, to make Advances to the Borrower, provided,
however, that (1) the sum of the total aggregate principal amount
outstanding at any one time of all such Advances shall not exceed the
Commitment, and (2) no Lender’s portion of the Advances shall exceed such
Lender’s Commitment Amount.  The aggregate amount of all Advances
outstanding from time to time hereunder may hereinafter collectively be referred
to as the “Loan.”  Within the Commitment, the Borrower may borrow,
repay and reborrow.  All Advances under this Agreement shall
constitute a single indebtedness, and all of the Collateral shall be security
for the Notes and for the performance of all the Obligations of the
Borrower.

       

       

       

       

      
        
          
          

        

        
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      (b)    Advances
shall be used by the Borrower solely for the purpose of funding the origination
of Eligible Loans as specified in the Advance Request, and none other, and shall
be made at the request of the Borrower in the manner hereinafter provided in
Section 2.2, against the pledge of such Mortgage Loans, and such other
collateral as is set forth in Section 3.1 hereof as Collateral
therefor.

       

      (c)     In
addition to the limitations set forth in this Agreement, each Advance to fund an
Eligible Loan shall be limited to the lesser of (x) the Mortgage Note
Amount, or (y) the Committed Purchase Price amount.

       

      (d)   In the
event at any time the outstanding principal balance of the Loan should exceed
the lesser of (x) the Commitment or (y) the aggregate Collateral Value
of all Eligible Loans against which Advances are then outstanding, the Borrower
shall repay such excess amount on demand to the Agent so that the outstanding
principal balance of the Loan is in compliance with the terms and provisions
hereof.

       

      (e)    The
Lenders shall have no obligation to make any Advances hereunder to fund the
origination of Fannie Mae DUS Mortgage Loans, Other Fannie Mae Mortgage Loans or
Freddie Mac Loans if Standard & Poor’s reduces the credit rating of Fannie
Mae (with respect to Fannie Mae DUS Mortgage Loans or Other Fannie Mae Mortgage
Loans) or Freddie Mac (with respect to Freddie Mac Loans) to A or lower (or
another Rating Agency reduces such credit rating to a comparable
rating).

       

      2.2.      Procedures for Obtaining
Advances.

       

      (a)    The
Borrower may obtain an Advance hereunder, subject to the satisfaction of the
conditions set forth in Sections 4.1 and 4.2 hereof, upon compliance with
the procedures set forth in this Section 2.2 and in the applicable Exhibit C
attached hereto and made a part hereof.  Requests for Advances shall
be initiated by the Borrower (i) by delivering to the Agent not later than
1 Business Day before the Business Day on which the Borrower desires the
Advance, a completed and signed request for an Advance (an “Advance Request”) in
the form of Exhibit A
attached hereto and made a part hereof,  The Agent shall have the
right, on not less than three (3) Business Days’ prior Notice to the Borrower,
to modify the form of the Advance Request or any exhibits hereto, subject to the
prior written consent of the Borrower, not to be unreasonably withheld, and, as
so modified, said Advance Request or exhibits shall be deemed a part
hereof.

       

      (b)    Subject
to the delivery of an Advance Request, and the satisfaction of the conditions
set forth in Sections 4.1 and 4.2, the Borrower is entitled to obtain an
Advance under this Agreement upon compliance with the procedures set forth in
this Section and in the applicable Exhibit
C, including delivery to the Agent of all required Collateral
Documents.

       

      (c)    To make
an Advance, the Agent shall credit the Borrower’s Funding Account upon
compliance by the Borrower with the terms of this Agreement.

       

       

       

      
        
          
          

        

        
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      2.3.      Notes.  The
Borrower’s obligation to pay the principal of, and accrued and unpaid interest
on, all Advances made by the Lenders shall be evidenced by the Notes of the
Borrower in favor of each Lender.  All terms and provisions of the
Notes are hereby incorporated herein.

       

      2.4.      Interest.

       

      (a)    Except as
provided in Section 2.4(c) below, the unpaid amount of each Advance
hereunder shall bear interest from the date of such Advance until paid in full,
at the Applicable Rate.

       

      (b)    All
interest shall be:  (a) payable in arrears on the first day of each
calendar month and on the Maturity Date; and (b) calculated on the basis of a
360 day year and the actual number of days elapsed.  If Borrower does
not pay interest when due following the invoice pursuant to Section 2.7,
Borrower authorizes Agent to charge the Operating Account for the payment of
accrued and unpaid interest for any calendar month; Agent shall notify Borrower
of such charge.

       

      (c)    Obligations
not paid when due (whether at stated maturity, upon acceleration following the
occurrence of an Event of Default or otherwise) shall bear interest, from the
date due until paid in full, at a rate of interest (“Default Rate”) at all times
equal a floating rate of interest which is equal two percent (2%) per annum
over the Applicable Rate, said interest to be payable on demand by
Agent.

       

      (d)    The
Borrower shall pay, upon billing therefor, a “Late Charge” equal to five percent
(5%) of the amount of any payment of principal, other than principal due at the
Maturity Date (or the date on which the Agent accelerates the time for payment
of the Loan after the occurrence of an Event of Default), interest, or other
Obligations, which are not paid within ten (10) days of the due date
thereof.  Late Charges are: (a) payable in addition to, and not
in limitation of, the Default Rate, (b) intended to compensate Agent and
the Lenders for administrative and processing costs incident to late payments,
(c) not interest, and (d) not subject to refund or rebate or credit
against any other amount due.

       

      (e)    Notwithstanding
any other provision of this Agreement, if, pursuant to this Agreement, the Agent
debits the Borrower’s Operating Account to honor an item presented against the
Operating Account and that debit or direction results in an overdraft, the Agent
may, but in no event shall be obligated to, make an additional Advance to fund
that overdraft (an “Overdraft Advance”).  The Borrower shall pay the
outstanding amount of any Overdraft Advance within one (1) Business Day
after the date of the Overdraft Advance.

       

      2.5.   Principal
Payments.

       

      (a)   Upon
acceleration of the Loan, if the Loan has been accelerated by the Agent (or the
Facility has been automatically terminated) upon an Event of Default, or at
the Maturity Date, all accrued and unpaid interest, principal and other
Obligations due with respect to the Loan shall be due and payable in full, and
the principal balance and such other Obligations, but not unpaid interest, shall
continue to bear interest at the Default Rate until so paid.

       

       

       

       

      
        
          
          

        

        
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      (b)   The
Borrower shall have the right to prepay the outstanding Advances in whole or in
part, from time to time, without premium or penalty, provided that: (i) the
Agent shall have actually received from the Borrower prior written Notice of (a)
the Borrower’s intent to prepay, (b) the amount of principal which will be
prepaid (the “Prepaid Principal”), and (c) the date on which the prepayment will
be made; (ii) each prepayment shall be in a minimum amount of $1,000,000 or more
(unless the prepayment retires the outstanding balance of a Warehouse Advance
with respect to a particular Pledged Asset or the Loan in full); and (iii) each
prepayment shall be in the amount of 100% of the Prepaid Principal, plus accrued
unpaid interest thereon to the date of prepayment, plus any other Obligations
relating specifically to the Prepaid Principal or which otherwise have become
due and payable to the Agent and Lenders under the Loan Documents on or before
the date of prepayment but have not been paid.

       

      (c)   The
Borrower shall be obligated to pay to the Agent on behalf of the Lenders,
without the necessity of prior demand or Notice from the Agent or any Lender,
and the Borrower authorizes the Agent on behalf of the Lenders to charge the
Operating Account or any other accounts of the Borrower in Agent’s possession
for the amount of any outstanding Advance against a specific Pledged Asset upon
the earliest occurrence of any of the following events:

       

      1.    Upon the
earlier to occur of (x) the payment of the Committed Purchase Price from an
Investor with respect to any Pledged Asset or (y) that date which is sixty
(60) days from the date of the funding of such Advance;

       

      2.    On the
date an Advance was made if the Pledged Loan that was to have been funded by
that Advance is not closed and funded;

       

      3.    Three
(3) Business Days elapse from the date an Advance was made against a
Pledged Loan, without receipt by the Agent of the Collateral Documents relating
to that Pledged Loan required to be delivered on that date, or such Collateral
Documents, upon examination by the Agent, are found not to be in compliance with
the requirements of this Agreement or the related Purchase Commitment and the
Borrower fails to cure such non-compliance within three (3) Business Days after
written Notice thereof;

       

      4.    Ten (10)
Business Days elapse without the return of a Collateral Document delivered by
the Agent to the Borrower under a Trust Receipt for correction or
completion;

       

      5.    Three (3)
Business Days after Borrower has received written Notice that a Pledged Loan is
determined to have been originated or issued based on materially untrue,
incomplete or inaccurate information or otherwise to be subject to fraud,
whether or not the Borrower had knowledge of the misrepresentation, incomplete
or incorrect information or fraud;

       

      6.    On the
date the Pledged Loan or a Lien prior to the Pledged Loan is defaulted and, if
the default is non-monetary, remains in default for a period of thirty (30) days
or more;

       

       

       

       

      
        
          
          

        

        
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      7.    On the
mandatory delivery date of the related Purchase Commitment if the related
Pledged Asset has not been delivered under the Purchase Commitment prior to such
mandatory delivery date, or on the date the related Purchase Commitment expires
or is terminated;

       

      8.    Three
(3) Business Days after the date a Pledged Asset is rejected for purchase
by an Investor unless another Purchase Commitment is provided within that 3
Business Day period;

       

      9.   On the
date the Pledged Loan does not qualify as an Eligible Loan; and

       

      10.  Upon the
sale, other disposition or prepayment of any Pledged Asset or, with respect to a
Pledged Loan included in an Eligible Mortgage Pool, upon the sale or other
disposition of the related Agency Security.

       

      (d)  In
addition to the payments required pursuant to Section 2.5(c), if the principal
amount of any Pledged Loan is prepaid in whole or in part while a Advance is
outstanding against the Pledged Loan, the Borrower must pay to Agent, without
the necessity of prior demand or Notice from Agent, the amount of the
prepayment, to be applied against such Advance.

       

      (e)   The
proceeds of the sale or other disposition of Pledged Assets must be paid
directly by the Investor to the Cash Collateral Account.  The Borrower
must give Notice to Agent (by telephone or electronic mail, and if by telephone,
followed promptly by written Notice) of the Pledged Assets for which
proceeds have been received.  Upon receipt of such Notice from the
Borrower, Agent will apply any proceeds deposited into the Cash Collateral
Account to the payment of the Advance related to the Pledged Assets identified
by the Borrower in its Notice, and those Pledged Assets will be considered to
have been redeemed from pledge.  Agent is entitled to rely upon the
Borrower’s affirmation that deposits in the Cash Collateral Account represent
payments from Investors for the purchase of the Pledged Assets specified by the
Borrower in its Notice.  If the payment from an Investor for the
purchase of Pledged Assets is less than the outstanding Advance against the
Pledged Assets identified by the Borrower in its Notice (the “Deficiency”), the
Borrower shall immediately deposit into the Cash Collateral Account the amount
of such Deficiency in collected funds, and the Borrower authorizes Agent to
charge the Borrower’s Cash Collateral Account for the amount deposited by the
Borrower to cover such Deficiency to be applied against such
Advance.  As long as no Default exists, Agent will transfer into the
Borrower’s Operating Account any excess payment from an Investor for Pledged
Assets.

       

      2.6.    Expiration of
Commitment.  Unless extended or terminated earlier as permitted
hereunder, the Commitment shall expire of its own term, and without the
necessity of action by the Lenders or the Agent, at the close of business on the
Maturity Date.  However, the remainder of this Agreement shall remain
in full force and effect until all amounts due on the Obligations have been paid
in full.  The Lenders have not made, and do not hereby make, any
commitment to renew, extend, rearrange or otherwise refinance the outstanding
and unpaid principal of the Notes or accrued interest thereon.  In the
event, however, the Lenders from time to time renew, extend, rearrange, increase
and/or otherwise refinance any portion or all of any Obligation and any accrued
interest thereon at any time, such refinancing shall be evidenced by appropriate
promissory notes in form and substance satisfactory to the Lenders and, unless
otherwise noted or modified at such time or times by the terms of such
promissory note or any agreements executed in connection therewith, any such
promissory notes and refinancing evidenced thereby shall be governed in all
respects by the terms of this Agreement.  Notwithstanding the
foregoing, Borrower may terminate the Commitment upon not less than thirty (30)
days prior written Notice to the Agent.  All Obligations of the
Borrower shall automatically become due and payable, without demand or Notice of
any kind, on the effective date of such termination including, but not limited
to, all Advances, accrued and unpaid interest, accrued and unpaid Non-Usage Fees
and Agent’s Fees through the effective date.

       

       

       

       

      
        
          
          

        

        
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      2.7.    Payments.  Except
as otherwise specifically provided herein, all payments hereunder shall be made
to the Agent on behalf of the Lenders not later than the close of business on
the date when due unless such date is a non-Business Day, in which case, such
payment shall be due not later than 2:00 p.m. on the first Business Day
thereafter, and shall be made in lawful money of the United States of America in
immediately available funds.  Any such payment made after 2:00 p.m.
shall be deemed to be received on the next Business Day and, if applicable,
interest thereon shall continue to accrue until such next Business
Day.  No Lender directly invoices Borrower for – and only Agent
invoices Borrower for – interest under the Loan Documents.  Agent may
submit monthly billings reflecting payments due; however, any changes in the
interest rate which occur between the date of billing and the due date may be
reflected in the billing for a subsequent month.  Neither the failure
of Agent to submit a billing nor any error in any such billing shall excuse the
Borrower from the obligation to make full payment of all the Borrower’s payment
Obligations when due.  All payments shall be applied first to the
payment of all fees, expenses, and other amounts due to the Lenders under this
Agreement (excluding principal and interest), then to accrued interest, and the
balance on account of outstanding principal, provided, however, that after the
occurrence and during the continuation of an Event of Default, payments will be
applied to the Obligations as the Agent determines, subject to the provisions of
Section 8.3.

       

      2.8.   Loan
Fees.

       

                (a)   Commitment
Fee.  The Borrower shall pay the commitment fee described in
the Fee Letter.

       

                           
(b)   Unused
Fee.  An unused fee in an amount equal to the Daily Unused
Amount (if a positive number), multiplied by twenty-five (25) basis points per
annum.  As used herein, “Daily Unused Amount” means the Commitment
then in effect, minus the outstanding principal balance of the
Advances.  The unused fee shall be calculated for each day of a
calendar quarter (or portion thereof) and shall be payable by the Borrower to
the Agent (for the ratable benefit of the Lenders) quarterly in arrears on the
last Business Day of June, September, and December and on the Maturity
Date.

       

                            (c)   Miscellaneous
Fees.  The Borrower shall pay to the Agent, promptly following
an invoice therefor,  miscellaneous fees including:

       

       

       

      
        
          
          

        

        
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      (i)   Wire
transfer fees customarily charged by the Agent;

       

      (ii)   Customary
handling fees of $100 per transaction involving
the  Collateral;

       

      (iii)   Customary
handling fees of $50 per transaction involving Mortgage-backed Securities;
and

       

      (iv)   Custody
account fees based on the Agent’s schedule of charges and fees that are
customary for similar services.

       

      (d)      
Administrative
Fees.  If, for any reason, (a) the Borrower repays an Advance
on the same day that it was made by the Lenders, or (b) the Borrower instructs
Agent not to make a previously requested Advance after the Lenders have reserved
funds or made other arrangements necessary to enable such Lenders to fund that
Advance, Borrower agrees to pay to each Lender an administrative fee equal to
one day of interest on that Advance at the Applicable
Rate.  Administrative fees are due and payable in the same manner as
interest is due and payable under this Agreement.

       

      2.9.     
Reserved.

       

      2.10.   Increased Costs; Capital
Requirements.  In the event there is a change after the date of
this Agreement in any applicable law, order, regulation or directive issued by
any governmental or monetary authority, or any change after the date of this
Agreement in the governmental or judicial interpretation or application thereof,
and such change:

       

      (a)   Does or
shall subject any Lender to any tax of any kind whatsoever with respect to this
Agreement or any Advances made hereunder, or change the basis of taxation on
payments to such Lender of principal, fees, interest or any other amount payable
hereunder (except for change in the rate of tax on the overall gross or net
income of such Lender by the jurisdiction in which such Lender’s principal
office is located);

       

      (b)   Does or
shall impose, modify or hold applicable any reserve, capital requirement,
special deposit, compulsory loan or similar requirement against assets held by,
or deposits or other liabilities in or for the account of, advances or loans by,
or other credit extended by, or any other acquisition of funds by, any office of
such Lender which are not otherwise included in the determination of the
interest rate as calculated hereunder;

       

      and the
result of all of the foregoing taken as a whole is to increase the cost to such
Lender of making, renewing or maintaining any Advance or to reduce any amount
receivable in respect thereof or to reduce the rate of return on the capital of
such Lender or any Person controlling such Lender as it relates to credit
facilities in the nature of that evidenced by this Agreement, then, in any such
case, the Borrower shall promptly pay any additional amounts necessary to
compensate such Lender for such additional cost or reduced amounts receivable or
reduced rate of return as reasonably determined by such Lender with respect to
this Agreement or Advances made hereunder or such Lender’s obligations
hereunder.  If a Lender becomes entitled to claim any additional
amounts pursuant to this Section, it shall notify the Borrower through the Agent
of the event by reason of which it has become so entitled and the Borrower shall
pay such amount within fifteen (15) days thereafter. Notwithstanding the
foregoing, the Borrower shall not be obligated to pay any such additional
amounts attributable to the period (the “Excluded Period”) ending ninety (90)
days prior to the date the Borrower receives written Notice of the law, order,
regulation, directive, change or request by reason of which such additional
amounts are payable, except to the extent such additional amounts accrued during
the Excluded Period due to the retroactive application of such law, order,
regulation, directive, change or request, in which case the limitation set forth
in this sentence shall not apply. A certificate as to any additional amount
payable pursuant to the foregoing sentence containing the calculation thereof in
reasonable detail submitted by a Lender, through the Agent, to the Borrower
shall be conclusive in the absence of manifest error. The obligations of the
Borrower under this Section shall survive the payment of all other Obligations
and the termination of this Agreement.

       

       

       

      
        
          
          

        

        
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      2.11.   Taxes.

       

      (a)    Any and
all payments by the Borrower to or for the account of the Agent or any Lender
under any Loan Document shall be made free and clear of and without deduction
for any and all present or future taxes, duties, levies, imposts, deductions,
assessments, fees, withholdings or similar charges, and all liabilities with
respect thereto, excluding, in the
case of the Agent and each Lender, taxes imposed on or measured by its overall
net income, and franchise taxes imposed on it (in lieu of net income taxes), by
the jurisdiction (or any political subdivision thereof) under the Laws of which
the Agent or such Lender, as the case may be, is organized or maintains a
lending office (all such non-excluded taxes, duties, levies, imposts,
deductions, assessments, fees, withholdings or similar charges, and liabilities
being hereinafter referred to as “Taxes”).  If
the Borrower shall be required by any Laws to deduct any Taxes from or in
respect of any sum payable under any Loan Document to the Agent or any Lender,
(i) the sum payable shall be increased as necessary so that after making
all required deductions (including deductions applicable to additional sums
payable under this Section), each of the Agent and such Lender receives an
amount equal to the sum it would have received had no such deductions been made,
(ii) the Borrower shall make such deductions, (iii) the Borrower shall
pay the full amount deducted to the relevant taxation authority or other
authority in accordance with applicable Laws, and (iv) within 30 days after
the date of such payment, the Borrower shall furnish to the Agent (which shall
forward the same to such Lender) the original or a certified copy of a receipt
evidencing payment thereof.

       

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

       

      (c)    If the
Borrower shall be required to deduct or pay any Taxes or Other Taxes from or in
respect of any sum payable under any Loan Document to the Agent or any Lender,
the Borrower shall also pay to the Agent or to such Lender, as the case may be,
at the time interest is paid, such additional amount that the Agent or such
Lender specifies is necessary to preserve the after-tax yield (after factoring
in all taxes, including taxes imposed on or measured by net income) that the
Agent or such Lender would have received if such Taxes or Other Taxes had not
been imposed.

       

       

       

       

      
        
          
          

        

        
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      (d)    The
Borrower agrees to indemnify the Agent and each Lender for (i) the full
amount of Taxes and Other Taxes (including any Taxes or Other Taxes imposed or
asserted by any jurisdiction on amounts payable under this Section) paid by the
Agent and such Lender, (ii) amounts payable under Section 2.11(c) and
(iii) any liability (including additions to tax, penalties, interest and
expenses) arising therefrom or with respect thereto, in each case whether or not
such Taxes or Other Taxes were correctly or legally imposed or asserted by the
relevant Governmental Authority.  Payment under this subsection (d)
shall be made within 30 days after the date the Lender or the Agent makes a
demand therefor.

       

      The
Agreement of the Borrower contained in this Section 2.11 shall survive the
expiration or termination of this Agreement and the payment in full of the
Notes.

       

      3.    
    COLLATERAL.

       

      3.1.   Grant of Security
Interest.  As security for the payment of the Notes and for the
payment and performance of all of the Borrower’s Obligations hereunder, the
Borrower hereby assigns and transfers all of its rights, titles and interests in
and to and grants a security interest to the Agent for the benefit of the
Lenders in the following described property, whether now owned or hereafter
acquired by the Borrower (the “Collateral”):

       

      (a)    All
amounts advanced by Lenders to or for the account of the Borrower under this
Agreement to fund a Mortgage Loan until that Mortgage Loan is closed and those
funds disbursed.

       

      (b)    All
Mortgage Loans, including all Mortgage Notes and Mortgages evidencing or
securing those Mortgage Notes, and all assignments of the same, that from time
to time are delivered or caused to be delivered to the Agent for the benefit of
the Lenders, come into the possession, custody or control of the Agent for the
purpose of assignment or pledge or in respect of which an Advance has been made
by the Lenders hereunder (the “Pledged Loans”).

       

      (c)    All
Mortgage-backed Securities that are created in whole or in part on the basis of
Pledged Loans or are delivered or caused to be delivered to the Agent for the
benefit of the Lenders, or are otherwise in the possession of the Agent or its
agent, bailee or custodian as assignee, or pledged to the Agent, or for such
purpose are registered by book-entry in the name of, the Agent (including
delivery to or registration in the name of a third party on behalf of the Agent
or any Lender) hereunder or in respect of which from time to time an Advance has
been made by the Lenders hereunder (the “Pledged Securities”).

       

      (d)    All
commitments issued by FHA to insure or guarantee any Mortgage Loans included in
the Pledged Loans; all Purchase Commitments held by the Borrower covering
Pledged Assets, and all proceeds from the sale of Pledged Assets to Investors
pursuant to those Purchase Commitments; and all personal property, contract
rights, servicing and servicing fees and income or other proceeds, amounts and
payments payable to the Borrower whether as compensation or reimbursement,
accounts or general intangibles of whatsoever kind relating to Pledged Assets,
FHA Commitments and the Purchase Commitments (subject to any restrictions on the
pledge thereof under the applicable requirements of Fannie Mae and Freddie Mac),
and all other documents or instruments relating to Pledged Assets, including any
interest of the Borrower in any fire, casualty or hazard insurance policies and
any awards made by any public body or decreed by any court of competent
jurisdiction for a taking or for degradation of value in any eminent domain
proceeding as the same relate to Pledged Assets.

       

       

       

       

      
        
          
          

        

        
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      (e)    All
documents, instruments, files, surveys, certificates, correspondence,
appraisals, computer programs, tapes, discs, cards, accounting records
(including all information, records, tapes, data, programs, discs and cards
necessary or helpful in the administration or servicing of the foregoing
Collateral) and other information and data of the Borrower relating to the
foregoing Collateral.

       

      (f)    All cash,
whether now existing or acquired after the date of this Agreement, delivered to
or otherwise in the possession of Agent or any Lender, or their respective
agents, bailees or custodians (provided, that with respect to funds held by the
Borrower in trust or escrow for any other Person with the Agent or any Lender,
only the Borrower’s interest in earnings on such funds shall be Collateral) or
designated on the books and records of the Borrower as assigned and pledged to
Agent for the benefit of the Lenders, including all cash deposited in the Cash
Collateral Account.

       

      (g)    All
Accounts or General Intangibles (as those terms are defined in the New York
Uniform Commercial Code owned by the Borrower (“Receivables”) related to the
Collateral referenced in Sections 3.1(a) through and including 3.1(c) for
the payment of money against (1) FHA or a private mortgage insurer under an
FHA or private insurer’s mortgage insurance policy insuring payment of, or any
other Person under any other agreement (excluding a Servicing Contract) relating
to, all or part of a defaulted Mortgage Loan repurchased by the Borrower from an
investor or out of a pool of Mortgage Loans serviced by the Borrower,
(2) obligors and their accounts, or any Investor, insurer or guarantor
covering, or out of the proceeds of any sale of or foreclosure sale in respect
of, any Mortgage Loan being serviced by any Borrower, in either case, for the
reimbursement of real estate taxes or assessments, or casualty or liability
insurance premiums, paid by the Borrower in connection with Mortgage Loans and
(3) obligors and their accounts, or any other Investor, insurer or
guarantor under or in respect of, or out of the proceeds of any sale or
foreclosure sale in respect of, any Mortgage Loans serviced by the Borrower for
repayment of advances made by the Borrower to cover shortages in principal and
interest payments.

       

      (h)    All
Hedging Arrangements related to the Collateral referenced in Section 3.1(a)
through and including 3.1(c) (“Pledged Hedging Arrangements”) and the Borrower’s
accounts in which those Hedging Arrangements are held (“Pledged Hedging
Accounts”), including all rights to payment arising under the Pledged Hedging
Arrangements and the Pledged Hedging Accounts, except that Agent’s security
interest in the Pledged Hedging Arrangements and Pledged Hedging Accounts is
limited to benefits, including rights to payment, related to the
Collateral.

       

      (i)    All
Accounts, Chattel Paper, Instruments, General Intangibles, Certificated
Securities, Uncertificated Securities, and Investment Property, as those terms
are defined in the New York Uniform Commercial Code, arising from or relating to
any of the foregoing Collateral.

       

       

       

       

      
        
          
          

        

        
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      (j)    All cash
and non-cash proceeds of the foregoing Collateral, including all dividends,
distributions and other rights in connection with, and all additions to,
modifications of and replacements for, the foregoing Collateral, and all
products and proceeds of the foregoing Collateral, together with whatever is
receivable or received when the foregoing Collateral or proceeds thereof are
sold, collected, exchanged or otherwise disposed of, whether such disposition is
voluntary or involuntary, including, without limitation, all rights to payment
with respect to any cause of action affecting or relating to the foregoing
Collateral or proceeds thereof.

       

      (k)    The Cash
Collateral Account, the Funding Account, and the Operating Account, all amounts
now or hereafter on deposit therein and all interest or other amounts now or
hereafter accrued thereon.

       

                3.2.    Authenticated
Record.  This Agreement constitutes an authenticated record
which authorizes the Agent to file such financing statements as the Agent
determines as appropriate to perfect or protect the security interests created
by this Agreement.

       

                3.3.    Release of Security Interest
in Pledged Assets.

       

      (a)    Except as
provided in Section 3.3(b) below, Pledged Loans will be released from
Agent’s security interest only against payment to Agent of the Release Amount in
connection with those Pledged Loans.  If Pledged Loans are transferred
to a pool custodian or an investor for inclusion in a Mortgage Pool and Agent’s
security interest in the Pledged Loans included in the Mortgage Pool is not
released before the issuance of the related Mortgage-backed Security, then that
Mortgage-backed Security, when issued, is a Pledged Security, Agent’s security
interest continues in the Pledged Loans backing that Pledged Security and Agent
is entitled to possession of the Pledged Security in the manner provided in this
Agreement.

       

      (b)    If
Pledged Loans are transferred to an Approved Custodian and included in an
Eligible Mortgage Pool, Agent’s security interest in the Pledged Loans included
in the Eligible Mortgage Pool will be released upon the delivery of the Agency
Security to Agent (including delivery to or registration in the name of a third
party on behalf of Agent), and that Agency Security is a Pledged
Security.  Agent’s security interest in that Pledged Security will be
released only against payment to Agent of the Release Amount in connection with
the Mortgage Loans backing that Pledged Security.

       

      (c)    The Agent
for the benefit of the Lenders has the exclusive right to possession of all
Pledged Securities or, if Pledged Securities are issued in book-entry form or
issued in certificated form and delivered to a clearing corporation (as such
term is defined in the UCC) or its nominee, Agent has the right to have the
Pledged Securities registered in the name of a securities intermediary (as such
term is defined in the UCC) in an account containing only customer
securities and credited to an account of Agent.  Agent has no duty or
obligation to deliver Pledged Securities to an Investor or to credit Pledged
Securities to the account of an Investor or the Investor’s designee except
against payment of the Release Amount for those Pledged Securities, unless the
Agent shall have entered into a master agreement with such Investor on terms and
conditions satisfactory to the Agent.  The Borrower acknowledges that
Agent may enter into one or more standing arrangements with securities
intermediaries with respect to Pledged Securities issued in book entry form or
issued in certificated form and delivered to a clearing corporation or its
nominee, under which the Pledged Securities are registered in the name of the
securities intermediary, and the Borrower agrees, upon request of Agent, to
execute and deliver to those securities intermediaries the Borrower’s written
concurrence in any such standing arrangements.

       

       

       

       

      
        
          
          

        

        
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      (d)    If no
Event of Default has occurred and is continuing, the Borrower may redeem a
Pledged Loan or Pledged Security from Agent’s security interest by notifying
Agent of its intention to redeem the Pledged Loan or Pledged Security from
pledge and paying, or causing an Investor to pay, to Agent the Release Amount in
connection with the Pledged Loan or the Pledged Loans backing that Pledged
Security.

       

      (e)    If an
Event of Default has occurred and is continuing, Agent may, with no liability to
the Borrower or any Person, continue to release its security interest in any
Pledged Asset against payment of the Release Amount in connection with that
Pledged Asset.

       

      (f)    The
amount (“Release Amount”) to be paid by the Borrower to obtain the release of
Agent’s security interest in a Pledged Asset will be (1) unless and until
an Event of Default occurs and is continuing, the principal amount of the
Advances outstanding against the Pledged Asset, and (2) while an Event of
Default exists, the full Committed Purchase Price therefor, or amount paid to
Agent in a commercially reasonable disposition of that Pledged Asset by the
Agent in the exercise of its rights and remedies under this
Agreement.

       

      3.4.    Delivery of Collateral
Documents.

       

      (a) If no
Event of Default has occurred and is continuing, the Agent will deliver
documents relating to the Collateral to the Borrower for correction or
completion under a Trust Receipt.

       

      (b) If no
Event of Default has occurred and is continuing, upon delivery by the Borrower
to the Agent of shipping instructions pursuant to the applicable Exhibit
C, the Agent will transmit Pledged Loans or Pledged Securities, together
with all related loan documents and pool documents in the Agent’s possession, to
the applicable Investor, Approved Custodian or other party acceptable to Agent
in its sole discretion.

       

      (c) Upon
receipt of Notice from the Borrower, and payment of the Release Amount with
respect to a Pledged Loan identified by the Borrower, Agent will release to the
Borrower any Collateral Documents relating to the redeemed Pledged Loan or the
Pledged Loans backing a Pledged Security that Agent has in its possession and
that have not been delivered to an Investor or Approved Custodian.

       

      3.5.    Collection and Servicing
Rights.  So long as no Event of Default shall have occurred and
is continuing, the Borrower shall have a revocable and nontransferable license
to service and retain subservicers, and receive and collect directly all sums
payable to the Borrower in respect of the Collateral other than proceeds of any
Purchase Commitment or proceeds of the sale of any Collateral.  During
the continuance of any Event of Default, the Agent or its designee may revoke
such license by Notice to the Borrower (or its successor, trustee, or receiver)
whereupon the Borrower’s rights to so service the Collateral shall
terminate.  Agent or its designee shall thereafter be entitled to
service and receive and collect all sums payable to the Borrower in respect of
the Collateral, and in such case (a) the Agent or its designee in its discretion
may, in its own name or in the name of the Borrower or otherwise, demand, sue
for, collect or receive any money or property at any time payable or receivable
on account of or in exchange for any of the Collateral, but shall be under no
obligation to do so, (b) the Borrower shall, if the Agent so requests, forthwith
deliver the credit files and the servicing files for the Collateral to the Agent
or its designee and pay to the Agent, on behalf of the Lenders, at its principal
office all amounts thereafter received by the Borrower upon or in respect of any
of the Collateral, advising the Agent as to the source of such funds, and (c)
all amounts so received and collected by the Agent shall be held by it for the
benefit of the Lenders as part of the Collateral.

       

       

       

       

      
        
          
          

        

        
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      3.6.    Return or Release of
Collateral at End of Commitment.  If (a) the Commitment
shall have expired or been terminated, and (b) no Advances, interest or
other Obligations evidenced by the Loan Documents or due under this Agreement
shall be outstanding and unpaid, the Agent shall deliver or release all
Collateral in its possession to the Borrower.  The receipt of the
Borrower for any Collateral released or delivered to the Borrower pursuant to
any provision of this Agreement shall be a complete and full acquittance for the
Collateral so returned, and the Agent and the Lenders shall thereafter be
discharged from any liability or responsibility therefor.

       

      4.        CONDITIONS
PRECEDENT.

       

      4.1. Initial
Advance.  The obligation of the Lenders to make any Advance
under this Agreement is subject to the satisfaction, in the sole discretion of
the Agent, on or before the date thereof, of the following conditions precedent,
save and except that Agent may, at its sole option, waive any one or more of the
following conditions prior to the Initial Advance but such waiver shall not
prevent Agent from requiring compliance of such condition(s) prior to any
subsequent Advance to the extent set forth in a supplemental agreement entered
into between the Borrower and Agent:

       

      (a)    Each of
the Loan Documents shall have been duly executed and delivered by the respective
parties thereto and, shall be in full force and effect and shall be in form and
substance satisfactory to each of the Lenders.

       

      (b)    UCC, tax
lien and judgment searches of the appropriate public records for the Borrower
that do not disclose the existence of any prior Lien on the Collateral other
than in favor of Agent or as permitted under this Agreement, or other than a
Lien in favor of any Person which Lien shall be terminated in accordance with
the provisions of this Agreement.

       

      (c)   Agent
shall have received from the Borrower a copy, certified as of a recent date by
the appropriate officer of the State in which such Person is organized to be
true and complete, of the corporate charter and any other organization documents
of such Person as in effect on such date of certification.  The
Borrower shall furnish evidence satisfactory to the Agent that they are each
duly qualified and in good standing in each jurisdiction in which it owns or
leases property or in which the conduct of its business requires it to so
qualify, except where the failure to so qualify could not have a materially
adverse effect on the business, assets, or financial condition of the
Borrower.

       

       

       

       

      
        
          
          

        

        
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      (d)    UCC
financing statements naming the Borrower as debtor and the Agent as secured
party covering the Collateral shall have been duly recorded and filed to the
satisfaction of Agent and its counsel.

       

      (e)    Agent
shall have received evidence, in form, scope and substance and with such
insurance carriers, satisfactory to the Agent, for all insurance policies
required under any of the Loan Documents.

       

      (f)    There
shall be no pending or threatened litigation involving the Borrower which could
reasonably be expected to result in a Material Adverse Change, and no judgment,
order, injunction or other similar injunction or other similar restraint
prohibiting any of the transactions contemplated hereby shall
exist.

       

      (g)    All
action on the part of the Borrower necessary for the valid execution, delivery
and performance by the Borrower of this Agreement and the other Loan Documents
shall have been duly and effectively taken, and evidence thereof satisfactory to
the Agent shall have been provided to the Agent.  Agent shall have
received from the Borrower true copies of resolutions adopted by the their
respective boards of directors authorizing the transactions described herein,
each certified by each of their secretaries as of a recent date to be true and
complete.

       

      (h)    Agent
shall have received from the Borrower an incumbency certificate, dated as of the
Closing Date, signed by a duly authorized officer of the Borrower and giving the
name and bearing a specimen signature of each individual who shall be an
Authorized Representative: (a) to sign, in the name and on behalf of such
Person, each of the Loan Documents to which such Person is or is to become a
party; (b) with respect to the Borrower, to make requests for Advances; and
(c) to give Notices and to take other action on behalf of the Borrower
under the Loan Documents.

       

      (i)    Copies of
the certificates, documents or other written instruments that evidence the
Borrower’s eligibility described in Section 5.11, together with copies of
all seller/servicer contracts to which the Borrower is a party, all in form and
substance satisfactory to Agent.

       

      (j)    Borrower
shall have paid to the Agent all fees and expenses required pursuant to this
Agreement and the other Loan Documents.

       

      (k)    The Agent
shall be satisfied that (i) the Borrower has obtained all material and
appropriate authorizations and approvals of all governmental authorities
(including, without limitation, any approvals required by any of Fannie Mae,
FHA, Freddie Mac, Ginnie Mae, HUD), required for the due execution, delivery and
performance by the Borrower of each of the Loan Documents and for the perfection
of or the exercise by the Agent and each Lender of their respective rights and
remedies under the Loan Documents, and (ii) all transactions contemplated hereby
shall be in material compliance with, and the Borrower shall have obtained all
material and appropriate approvals pertaining to, all applicable laws, rules,
regulations and orders, including, without limitation, all governmental,
environmental, ERISA, retiree health benefits, workers’ compensation and other
requirements, regulations and laws and shall not contravene any charter, by-law,
debt instrument or other material contact or agreement to which Borrower is a
party.

       

       

       

       

      
        
          
          

        

        
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      (l)    No
Material Adverse Change shall have occurred since the Statement Date and the
Interim Date.

       

      (m)   Borrower shall have
provided such additional instruments and documents to the Agent and the Lenders
as the Agent and the Agent’s counsel may have reasonably requested.

       

      4.2.   Each
Advance.  The obligation of the Lenders to make any Advance
under this Agreement is subject to the satisfaction, in the sole discretion of
the Agent, as of the date of each such Advance, of the following additional
conditions precedent, save and except that Agent may, at its sole option, waive
any one or more of the following conditions prior to the requested Advance but
such waiver shall not prevent Agent from requiring compliance of such
condition(s) prior to any subsequent Advance:

       

      (a)    In
connection with an Advance, the Borrower shall have delivered to the Agent the
Advance Request, and the Collateral Documents, called for under, and shall have
satisfied the procedures set forth in, Section 2.2 hereof and the
applicable Exhibit
C hereto described in that Section, according to the type of the
requested Advance.  All items delivered to the Agent shall be
satisfactory to the Agent, in form and content, and the Agent may reject such of
them as do not meet the requirements of this Agreement or of the related
Purchase Commitment.

       

      (b)    The Agent
shall have received evidence satisfactory to it as to the making and/or
continuation of any book entry or the due filing and recording in all
appropriate offices of all financing statements and other instruments as may be
necessary to perfect the security interest of the Agent in the Collateral under
the Uniform Commercial Code of New York or other applicable law.

       

      (c)    The
representations and warranties of the Borrower contained in Article 5
hereof shall be accurate and complete in all material respects as if made on and
as of the date of each Advance (except to the extent of changes resulting from
transactions contemplated and permitted by this Agreement and the other Loan
Documents and changes occurring in the ordinary course of business that singly
or in the aggregate are not materially adverse, and except to the extent that
such representations and warranties relate expressly to an earlier
date, and, unless Agent and each of the Lenders is notified to the contrary
prior to the disbursement of the requested Advance).

       

      (d)    The
Borrower shall have performed all agreements to be performed by it hereunder,
including without limitation, the payment of all fees when due hereunder, and,
as of the date of the Advance Request, and after giving effect to the requested
Advance, there shall exist no Default or Event of Default
hereunder.

       

      (e)    No change
shall have occurred in any Legal Requirement that in the reasonable opinion of
any Lender would make it illegal for such Lender to make such Advance, and each
Lender shall have received such statements in substance and form reasonably
satisfactory to such Lender as such Lender shall require for the purpose of
compliance with any applicable regulations of the Comptroller of the Currency or
the Board of Governors of the Federal Reserve System.

       

       

       

       

      
        
          
          

        

        
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      (f)    No
Material Adverse Change shall have occurred since the date of this
Agreement.

       

      Acceptance
of the proceeds of the requested Advance by the Borrower shall be deemed a
representation by the Borrower that all conditions set forth in this
Article 4 shall have been satisfied as of the date of such
Advance.

       

      Notwithstanding
the foregoing, or anything herein to the contrary, the Lenders shall have no
obligation to make any Advances under this Agreement if, at any time, there
shall have occurred any change in the ownership of the capital stock of
Centerline Servicing, Inc., a Delaware corporation, from that existing on the
date hereof, unless
and until the Agent, in its sole direction, approves of any third-party servicer
retained by CMC.

       

      4.3.     Post-Closing
Deliverables.  The Borrower shall cause each of the following
conditions to be performed and completed within the applicable timeframe after
the Closing Date as provided for such condition (as applicable to each such
condition, the “Completion Date”).  If the Borrower fails to complete
any of the conditions by the applicable Completion Date, such failure shall, at
the Agent’s option, be deemed to be an Event of Default under this
Agreement:

       

      (a)    within
ten (10) days following the Closing Date, Agent shall have received a favorable
written opinion of counsel to the Borrower, in form, scope, and substance
satisfactory to the Agent, addressed to the Agent and the Lenders.

       

      (b)    within
two (2) days following the Closing Date, Agent shall have received from the
Borrower financial statements of the Borrower (and its Subsidiaries, on a
consolidated basis) containing a balance sheet as of December 31, 2008 (the
“Statement Date”) and related statements of income, changes in stockholders’
equity and cash flows for the period ended on the Statement Date and a balance
sheet as of June 30, 2009 (“Interim Date”) and related statement of income for
the period ended on the Interim Date, all prepared in accordance with GAAP
applied on a basis consistent with prior periods and in the case of the
statements as of the Statement Date, audited by independent certified public
accountants of recognized standing acceptable to the Agent, together with an
Officer Certificate prepared as of the Interim Date and executed by any officer
of the Borrower.

       

      5.       REPRESENTATIONS
AND WARRANTIES.

       

      The
Borrower hereby represents and warrants to the Agent and the Lenders, as of the
date of this Agreement and (unless otherwise notified in writing by the Borrower
and Agent, in its sole discretion, approves in writing) as of the date of each
Advance Request and the making of each Advance, that:

       

      5.1.    Organization; Good Standing;
Subsidiaries.  The Borrower and each Subsidiary of the Borrower
is a corporation duly organized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation, has the full legal power and
authority to own its property and to carry on its business as currently
conducted and is duly qualified as a foreign corporation to do business and is
in good standing in each jurisdiction in which the transaction of its business
makes such qualification necessary, except in jurisdictions, if any, where a
failure to be in good standing could not reasonably be expected to result in a
Material Adverse Change.  For the purposes hereof, good standing shall
include qualification for any and all licenses and payment of any and all taxes
required in the jurisdiction of its incorporation and in each jurisdiction in
which the Borrower transacts business.  The Borrower has no
Subsidiaries except as set forth on Schedule
5.1 hereto.  Schedule
5.1 sets forth with respect to each such Subsidiary, its name, address,
place of incorporation, each state in which it is qualified as a foreign
corporation, and the percentage ownership of the Borrower in such
Subsidiary.

       

       

       

       

      
        
          
          

        

        
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      5.2.    Authorization and
Enforceability.  The Borrower has all requisite corporate power
and authority to execute, deliver, create, issue, comply and perform this
Agreement, the Notes and all other Loan Documents to which the Borrower is party
and to make the borrowings hereunder.  The execution, delivery and
performance by the Borrower of this Agreement, the Notes and all other Loan
Documents to which the Borrower is party and the making of the borrowings
hereunder and thereunder, have been duly and validly authorized by all necessary
corporate action on the part of the Borrower (none of which actions has been
modified or rescinded, and all of which actions are in full force and effect)
and do not and will not conflict with or violate any provision of law or of the
articles of incorporation or by-laws of the Borrower, conflict with or result in
a breach of or constitute a default or require any consent under any contracts
to which Borrower is a party, or result in the creation of any Lien upon any
property or assets of the Borrower other than the Lien on the Collateral granted
hereunder, or result in or require the acceleration of any Indebtedness of the
Borrower pursuant to any agreement, instrument or indenture to which the
Borrower is a party or by which the Borrower or its property may be bound or
affected.  This Agreement, the Notes and all other Loan Documents
contemplated hereby or thereby constitute legal, valid, and binding obligations
of the Borrower, enforceable in accordance with their respective terms, except
as limited by bankruptcy, insolvency or other such laws affecting the
enforcement of creditors’ rights generally.

       

      5.3.    Financial
Condition.  The balance sheet of the Borrower provided to Agent
pursuant to Section 4.3(b) hereof (and if applicable, its Subsidiaries, on
a consolidating and consolidated basis) as at the Statement Date, and the
related statements of income, changes in stockholders’ equity, and cash flows
for the fiscal year ended on the Statement Date, heretofore furnished to the
Agent, fairly present in accordance with GAAP the financial condition of the
Borrower and its Subsidiaries as at the Statement Date and the Interim Date and
the results of its and their operations for the fiscal period ended on the
Statement Date and the Interim Date.  The Borrower had, on the
Statement Date and the Interim Date no known material liabilities of a kind
required to be disclosed on a balance sheet or the notes thereto in accordance
with GAAP, or any known redemption obligations, hedging liabilities, or other
off-balance sheet financial transactions as to which there is recourse to the
Borrower. Said financial statements were prepared in accordance with GAAP
applied on a consistent basis throughout the periods involved.  Since
the Interim Date, there has been no Material Adverse Change, nor is the Borrower
aware of any state of facts particular to the Borrower which (with or without
Notice or lapse of time or both) could reasonably be expected to result in a
Material Adverse Change.

       

       

       

       

      
        
          
          

        

        
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      5.4.    Litigation.  Except
as disclosed on Schedule
5.4, there are no actions, claims, suits or proceedings pending, or to
the knowledge of the Borrower, threatened or reasonably anticipated against or
affecting the Borrower or any Subsidiary of the Borrower in any court or before
any arbitrator or before any government commission, board, bureau or other
administrative agency which could reasonably be expected to, either in any case
or in the aggregate, result in a Material Adverse Change or materially impair
the right of such Person to carry on business substantially as now conducted by
it, or result in any substantial liability not adequately covered by insurance,
or for which adequate reserves are not maintained on the balance sheet of such
Person (considering the Borrower and its Subsidiaries as a single Person for
purposes of this Section 5.4), or which question the validity of this
Agreement or any of the other Loan Documents, or any action taken or to be taken
pursuant hereto or thereto.

       

      5.5.    Compliance with
Laws.  Neither the Borrower nor any Subsidiary of the Borrower
is in violation of any provision of any law, or of any judgment, award, rule,
regulation, order, decree, writ or injunction of any court or public regulatory
body or authority which could reasonably be expected to result in a Material
Adverse Change.

       

      5.6.    Regulation U and
X.  The Borrower is not engaged principally, or as one of its
important activities, in the business of extending credit for the purpose of
purchasing or carrying Margin Stock, and no part of the proceeds of any Advances
made hereunder will be used for the purpose of purchasing or carrying any
“margin security” or “margin stock” as such terms are used in Regulations U and
X of the Board of Governors of the Federal Reserve System, 12
C.F.R.  Parts 221 and 224.

       

      5.7.    Holding Company and
Investment Company Act.  None of the Borrower nor any of its
Subsidiaries is a “holding company”, or a “subsidiary company” of a “holding
company”, or an “affiliate” of a “holding company”, as such terms are defined in
the Public Utility Holding Company Act of 1935; nor is it an “investment
company”, or an “affiliated company” or a “principal underwriter” of an
“investment company”, as such terms are defined in the Investment Company Act of
1940.

       

      5.8.    Agreements.  Neither
the Borrower nor any Subsidiary of the Borrower is a party to any agreement,
instrument or indenture, or subject to any restriction, materially and adversely
affecting its business, operations, assets or financial condition, except as
disclosed in the financial statements described in Section 5.3
hereof.  The Borrower and each Subsidiary of the Borrower are not in
default in the performance, observance or fulfillment of any of the obligations,
covenants or conditions contained in any agreement, instrument, or indenture,
which default could reasonably be expected to result in a Material Adverse
Change.  No holder of any Indebtedness for money borrowed having a
principal amount of $500,000 or more by the Borrower or of any of its
Subsidiaries has given Notice of any alleged default thereunder or, if given,
the same has been cured or will be cured by Borrower within the cure period
provided therein, and no liquidation or dissolution of the Borrower or any of
its Subsidiaries and no receivership, insolvency, bankruptcy, reorganization or
other similar proceedings relative to the Borrower or any of its Subsidiaries or
any of their respective properties is pending, or to the knowledge of the
Borrower, threatened.

       

       

       

       

      
        
          
          

        

        
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      5.9.    Title to
Properties.  The Borrower and each Subsidiary of the Borrower
has good, valid, and in the case of real property insurable and marketable title
to all of its material properties and assets (whether real or personal, tangible
or intangible) reflected on the financial statements described in
Section 5.3 hereof, and all such properties and assets are free and clear
of all Liens except as disclosed in such financial statements and not prohibited
under this Agreement.

       

      5.10.    ERISA.  Neither
the Borrower nor any entity that could be treated as a single employer with the
Borrower under Internal Revenue Code Section 414(b), (c), (m), (n) or (o),
now or at any time during the sixty month period ending on the date hereof,
sponsor(ed), maintain(ed) or contribute(d) to (or have or had an
obligation to contribute to) any pension, profit sharing, stock option,
insurance or other arrangement or plan for current or former employees that is
subject to Title IV of the Employer Retirement Income Security Act of 1974,
as now or hereafter amended (“ERISA”) or ERISA Section 302 except as may be
identified to Agent in writing (which writing shall be supplemented, within 30
days of Agent’s request, by a copy of the arrangement or plan, and the financial
statements and accountant’s reports for such arrangement or plan) by the
Borrower from time to time (“ERISA Plan”) and no “Reportable Event,” as defined
for purposes of Section 4043 of ERISA, has occurred with respect to any
such ERISA Plan.  The granting of the Loan, the performance by the
Borrower of its obligations under the Loan Documents, and the Borrower’s
conducting of its operations do not and will not violate any provisions of ERISA
or any ERISA Plan.

       

      5.11.    Eligibility.  Except
as permitted in Section 7.2 hereof, Borrower is and will remain at all times
approved and qualified and in good standing as a lender or seller/servicer, as
set forth below, and meets all requirements applicable to its status
as:

       

      (a)   for CMC
and solely with respect to Pledged Loans that are FHA fully insured Mortgage
Loans, a FHA approved mortgagee, eligible to originate, purchase, hold, sell and
service FHA fully insured Mortgage Loans.

       

      (b)    for CMC
and solely with respect to Pledged Securities that are guaranteed by Ginnie Mae,
a Ginnie Mae approved seller/servicer of Mortgage Loans and issuer of
Mortgage-backed Securities guaranteed by Ginnie Mae.

       

      (c)    for CMC,
a Fannie Mae approved seller/servicer of Mortgage Loans, eligible to originate,
purchase, hold, sell and service Mortgage Loans to be sold to Fannie
Mae.

       

      (d)    for CMC,
a Fannie Mae approved and qualified Delegated Underwriting and Servicing Lender,
eligible to process, underwrite, hold, sell to Fannie Mae and service Fannie Mae
Mortgage Loans under the DUS Program.

       

      (e)    for CMC
and CMP, a Freddie Mac approved seller/servicer of Mortgage Loans, eligible to
originate, purchase, hold, sell and service Mortgage Loans to be sold to Freddie
Mac.

       

       

       

       

      
        
          
          

        

        
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      5.12.    Special Representations
Concerning Collateral.  The Borrower hereby represents and
warrants to the Agent and each Lender, as of the date of this Agreement and as
of the date of each Advance, that:

       

      (a)    The
Borrower has not selected the Collateral in a manner so as to affect adversely
the Agent’s interests.

       

      (b)    The
Borrower is the legal and equitable owner and holder of the Pledged Assets, free
and clear of all Liens, other than Liens granted under this Agreement and
assignments of Mortgages to Fannie Mae and Freddie Mac, which Fannie Mae and
Freddie Mac, as applicable, have agreed to assign back to the Agent if Fannie
Mae or Freddie Mac, as applicable, does not acquire the corresponding Pledged
Asset.  All Pledged Assets and related Purchase Commitments have been
duly authorized and validly issued to the Borrower, and all of the foregoing
items of Collateral comply with all of the requirements of this Agreement, and
have been and will continue to be validly pledged or assigned to Agent, subject
to no other Liens.

       

      (c)    The
Borrower has, and will continue to have, the full right, power and authority to
pledge the Collateral pledged and to be pledged by it hereunder.

       

      (d)    Each
Mortgage Loan and each related document included in the Pledged Loans
(1) has been duly executed and delivered by the parties to that Mortgage
Loan and that related document, (2) has been made in compliance with all
applicable laws, rules and regulations (including all laws, rules and
regulations relating to usury), (3) is and will continue to be a legal,
valid and binding obligation, enforceable in accordance with its terms, without
setoff, counterclaim or defense in favor of the mortgagor under the Mortgage
Loan or any other obligor on the Mortgage Note and (4) has not been
modified, amended or any requirements of which waived, except in a writing that
is part of the Collateral Documents.  No party to any Mortgage Loan or
related document included in the Pledged Loans is in violation of any applicable
law, rule or regulation if the violation would impair the collectibility of the
Mortgage Loan or the performance by the mortgagor or any other obligor of its
obligations under the Mortgage Note or any related document.

       

      (e)    Each
Pledged Loan is secured by a Mortgage on real property located in one of the
states of the United States or the District of Columbia.

       

      (f)    Each
Pledged Loan has been closed or will be closed and funded with the Advance made
against it.

       

      (g)    Each
Pledged Loan that is not an FHA Construction Mortgage Loan has been fully
advanced in the face amount of its Mortgage Note.  The Agent
acknowledges and agrees that in certain instances, a portion of the proceeds of
a Pledged Loan, although advanced to the borrower thereunder, will be held by
the Borrower in escrow to be disbursed upon the completion of repairs to the
subject property or upon the achievement of specified factors.

       

      (h)    Each
First Mortgage Loan is secured by a first Lien on the premises described in that
Mortgage and each second Mortgage Loan or third Mortgage Loan is secured by a
second or third Lien on the premises described in that Mortgage, and with
respect to each second Mortgage Loan or third Mortgage Loan, the Borrower shall
be the servicer and the Purchase Commitment shall be from the same Investor
which holds the senior Lien on the premises.  Each Pledged Loan has or
will have a title insurance policy, in ALTA form or equivalent, from a
recognized title insurance company, insuring the priority of the Lien of the
Mortgage and meeting the usual requirements of Investors purchasing those
Mortgage Loans.

       

       

       

       

      
        
          
          

        

        
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      (i)    Each
Property has been evaluated or appraised in accordance with Title XI of
FIRREA, to the extent required.

       

      (j)    The
Mortgage Note for each Pledged Loan is (1) payable or endorsed to the order
of the Borrower, (2) an “instrument’ within the meaning of
Section 9-102 of the Uniform Commercial Code of all applicable
jurisdictions and (3) is denominated and payable in United States
dollars.

       

      (k)    No
monetary default and, to the Borrower’s knowledge, no other default has existed
for 60 days or more under any Mortgage Loan included in the Pledged
Loans.

       

      (l)    The
Borrower has complied and will continue to comply with all laws, rules and
regulations in respect of the FHA insurance of each Mortgage Loan included in
the Pledged Loans designated by the Borrower as an FHA insured or VA guaranteed
Mortgage Loan, and such insurance or guarantee is and will continue to be in
full force and effect.

       

      (m)    All fire
and casualty policies covering Mortgaged Property encumbered by a Pledged Loan
(1) name the Borrower and its successors and assigns as the insured under a
standard mortgagee clause, (2) are and will continue to be in full force
and effect, and (3) afford and will continue to afford insurance against
fire and such other risks as are usually insured against in the broadest form of
extended coverage insurance from time to time available.

       

      (n)    Pledged
Loans encumbering Mortgaged Property located in a special flood hazard area
designated as such by the Secretary of HUD and/or the Director of the Federal
Emergency Management Agency are and shall continue to be covered by special
flood insurance under the National Flood Insurance Program.

       

      (o)    Each
Pledged Loan against which a Advance is made on the basis of a Purchase
Commitment meets all of the requirements of that Purchase Commitment, and each
Pledged Security against which an Advance is outstanding meets all of the
requirements of the related Purchase Commitment.

       

      (p)    Pledged
Loans that are intended to be exchanged for Agency Securities comply or, prior
to the issuance of the Agency Securities will comply, with the requirements of
any governmental instrumentality, department or agency or any other Person
issuing or guaranteeing the Agency Securities.

       

      (q)    Pledged
Loans that are intended to be used in the formation of Mortgage-backed
Securities (other than Agency Securities) comply with the requirements of the
issuer of the Mortgage-backed Securities (or its sponsor) and of the Rating
Agencies.

       

       

       

       

      
        
          
          

        

        
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      (r)    None of
the Pledged Loans is a graduated payment Mortgage Loan or has a shared
appreciation or other contingent interest feature, and each Pledged Loan
provides for periodic payments of all accrued interest on the Mortgage Loan on
at least a monthly basis.

       

      (s)    The
Borrower does not have any ownership interest, right to acquire any ownership
interest or equivalent economic interest in any property securing a Mortgage
Loan or the mortgagor under the Mortgage Loan or any other obligor on, or
guarantor of, the Mortgage Note.

       

      (t)    The
original assignments of Mortgage and of UCC financing statements delivered to
the Agent for each Pledged Loan are in recordable form and comply with all
applicable laws and regulations governing the filing and recording of such
documents.

       

      (u)    Each
Pledged Loan secured by real property to which a manufactured home is affixed
will create a valid Lien on that manufactured home that will have priority over
any other Lien on the manufactured home, whether or not arising under applicable
real property law or the UCC or other applicable law.

       

      (v)    Agent
will have a valid and duly perfected security interest, without further
requirements for perfection, in (a) the Pledged Loans and Pledged
Securities upon the delivery thereof to the Agent for the benefit of the Lenders
and (b) the other Collateral described in Section 3.1 hereof to the extent
that a security interest therein may be perfected under Article 9 of the
UCC solely by filing a financing statement with the Secretary of State of
Delaware, which lien shall be superior to any other interests
therein.

       

      (w)    All
Pledged Assets have been underwritten in accordance with the standards and
guidelines issued by Fannie Mae, Freddie Mac, FHA or Ginnie Mae, as applicable,
except to the extent of any variation from such standards and guidelines
permitted under the applicable Purchase Commitments or the standard agreements
between Fannie Mae, Freddie Mac, FHA or Ginnie Mae, as applicable, and mortgage
lenders or seller/servicers.

       

      (x)    In
connection with any Indebtedness incurred by Borrower that is permitted pursuant
to Section 7.16(j), at the time of the initial sale pursuant to the ASAP Program
to Fannie Mae of a Mortgage Loan, such Mortgage Loan will be subject to a
Purchase Commitment and the Borrower’s primary obligation will be to deliver
such Mortgage Loan to Fannie Mae in accordance with such Purchase Commitment
and, in the event such Borrower is unable to deliver such Mortgage Loan in
accordance with such Purchase Commitment, to buy back such Mortgage Loan,
resulting in recourse exposure with respect to such Mortgage Loan substantially
similar to the Borrower’s recourse exposure in connection with Fannie Mae DUS
Mortgage Loans.

       

      5.13.    Franchises, Patents,
Copyrights, etc.  Borrower possesses all franchises, patents,
copyrights, trademarks, trade names, licenses and permits, and rights in respect
of the foregoing, adequate for the conduct of its business substantially as now
conducted, without known conflict with any rights of others.

       

       

       

       

      
        
          
          

        

        
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      5.14.    Proper
Names.  Borrower does not originate Mortgage Loans or otherwise
conduct business under any names other than its legal name and the assumed names
set forth on Schedule
5.14.  The Borrower has made all filings and taken all other
action as may be required under the laws of any jurisdiction in which it
originates Mortgage Loans or otherwise conducts business under any assumed
name.  The Borrower’s use of the assumed names set forth on Schedule
5.14 does not conflict with any other Person’s legal rights to any such
name, nor otherwise give rise to any liability by the Borrower to any other
Person.

       

      5.15.    Direct Benefit From
Loans.  The Borrower has received, or, upon the execution and
funding thereof, will receive (a) direct and indirect benefit from the
making and execution of this Agreement and the other Loan Documents to which it
is a party, and (b) fair and independent consideration for the entry into,
and performance of, this Agreement and the other Loan Documents to which it is a
party.  Contemporaneously with the disbursements of each Advance by
the Lenders to the Borrower, all such proceeds will be used to for the purposes
set forth in Section 2.1 hereof and none other.

       

      5.16.    Loan Documents Do Not
Violate Other Documents.  Neither the execution and delivery by
the Borrower of this Agreement or any other Loan Document to which it is a party
nor the consummation of the transactions herein and therein contemplated, nor
the performance of, or compliance with, the terms and provisions hereof and
thereof, does or will contravene, breach or conflict with any provision of
either of its articles of incorporation or by-laws, or any applicable law,
statute, rule or regulation or any judgment, decree, writ, injunction,
franchise, order or permit applicable to the Borrower or its assets or
properties, or does or will conflict or be inconsistent with, or does or will
result in any breach or default of, any of the terms, covenants, conditions or
provisions of, or constitute a default under, or result in the creation or
imposition of any Lien upon any of the property or assets of the Borrower
pursuant to the terms of any indenture, mortgage, deed of trust, loan agreement,
or other instrument to which the Borrower is a party or by which the Borrower or
any of its property may be bound, the contravention, conflict, inconsistency,
breach or default of which will have a materially adverse effect on the
Borrower’s condition, financial or otherwise, or affect its ability to perform,
promptly and fully, its obligations hereunder or under any of the other Loan
Documents.

       

      5.17.    Continuing Authority of
Authorized Representatives.  Agent and each of the Lenders are
authorized to rely upon the continuing authority of the Persons hereafter
designated by the Borrower (“Authorized Representatives”) to bind the Borrower
with respect to all matters pertaining to the Loan and the Loan Documents
including, but not limited to, the submission of requests for Advances, and
certificates with regard thereto.  Such authorization may be changed
only upon written Notice to Agent accompanied by evidence, reasonably
satisfactory to Agent, of the authority of the person giving such Notice and
such Notice shall be effective not sooner than five (5) Business Days following
receipt thereof by Agent.  The Authorized Representatives as of the
date of this Agreement are listed on Schedule
5.17.

       

      5.18.    Consents Not
Required.  Except for those consents that have already been
obtained and delivered to Agent or required as a condition to any Advance
hereunder, no consent of any Person and no consent, license, permit, approval,
or authorization of, exemption by, or registration or declaration with, any
Tribunal is required in connection with the execution, delivery, performance,
validity, or enforceability of this Agreement or any of the Loan Documents by
the Borrower.

       

       

       

       

      
        
          
          

        

        
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      5.19.    Material Fact
Representations.  Neither the Loan Documents nor any other
agreement, document, certificate, or written statement furnished to the Agent or
any Lender by or on behalf of the Borrower in connection with the transactions
contemplated in any of the Loan Documents contains any untrue statement of a
material adverse fact.  There are no facts or conditions known to the
Borrower which could reasonably be expected to result in a Material Adverse
Change that have not been fully disclosed, in writing, to the Agent and the
Lenders, it being understood that this representation is made as of, and shall
be limited to the date of this Agreement.  All writings heretofore or
hereafter exhibited or delivered to the Agent or any Lender by or on behalf of
the Borrower are and will be genuine and what they purport to be.

       

      5.20.    Place of
Business.  As of the date of this Agreement, the principal
place of business of the Borrower and the chief executive office of the Borrower
and the office where it keeps its financial books and records relating to its
property and all contracts relating thereto and all accounts arising therefrom
are located at its principal office at New York, New York, or its office where
Mortgage servicing is conducted at Irving, Texas, or at its office in Jersey
City, New Jersey.

       

      5.21.    Tax Returns and
Payments.  All federal, state and local income, excise,
property and other tax returns required to be filed with respect to Borrower’s
operations and those of its Subsidiaries in any jurisdiction have been filed on
or before the due date thereof (plus any applicable extensions); all such
returns are true and correct; all taxes, assessments, fees and other
governmental charges upon the Borrower, and Borrower’s Subsidiaries and upon its
property, income or franchises, which are due and payable have been paid,
including, without limitation, all FICA payments and withholding taxes, if
appropriate, other than those which are being contested in good faith by
appropriate proceedings, diligently pursued and as to which the Borrower has
established adequate reserves determined in accordance with GAAP, consistently
applied.  The amounts reserved, as a liability for income and other
taxes payable, in the financial statements described in Section 5.3 hereof
are sufficient for payment of all unpaid federal, state and local income,
excise, property and other taxes, whether or not disputed, of the Borrower and
its Subsidiaries, accrued for or applicable to the period and on the dates of
such financial statements and all years and periods prior thereto and for which
the Borrower, and Borrower’s Subsidiaries may be liable in their own right or as
transferee of the assets of, or as successor to, any other Person.

       

      5.22.    Certain
Transactions.  Except as set forth in Schedule
5.22 hereof, as of the date of this Agreement, none of the officers,
trustees, directors, or employees of the Borrower or any of their Subsidiaries
is presently a party to any transaction with the Borrower or any of their
Subsidiaries (other than for services as employees, officers and directors),
including any contract, agreement or other arrangement (i) providing for
the furnishing of services to or by, (ii) providing for rental of real or
personal property to or from, or (iii) otherwise requiring payments to or
from, any officer, trustee, director or such employee or any corporation,
partnership, trust or other entity in which any officer, trustee, director, or
any such employee has a substantial interest or is an officer, director, trustee
or partner.

       

      5.23.    No Broker or
Finder.  None of the Borrower nor anyone on behalf thereof has
dealt with any broker, finder or other person or entity who or which may be
entitled to a broker’s or finder’s fee, or other compensation, payable by the
Agent or any of the Lenders in connection with this Loan.

       

       

       

       

      
        
          
          

        

        
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      5.24.    Special Representations
Concerning Servicing Portfolio.  Schedule
5.24 is a true and complete list of the Borrower’s Servicing Portfolio as
of the date set forth therein.  The Borrower hereby represents and
warrants to Agent and the Lenders, as of the date of this Agreement and as of
the date of each Advance Request and the making of each Advance,
that:

       

      (a)    The
Borrower is the legal and equitable owner and holder, free and clear of all
Liens of the Servicing Contracts.

       

      (b)    Except as
otherwise disclosed to the Agent and the Lenders, all of the Borrower’s
servicing rights under the Servicing Contracts constitute primary servicing
rights.

       

      (c)    Each
Servicing Contract is in full force and effect and is legal, valid and
enforceable in accordance with its terms, and no default or event that, with
Notice or lapse of time or both, would become a default, exists under any
Servicing Contract, except where the failure of the foregoing could not
reasonably be expected to result in a Material Adverse Change.

       

      (d)    Each
right to the payment of money under the Servicing Contracts is genuine and
enforceable in accordance with its terms against the parties obligated to pay
the same, which terms have not been modified or waived in any respect or to any
extent, except where such modification or waiver could not reasonably be
expected to result in a Material Adverse Change.

       

      (e)    To the
best of the Borrower’s knowledge, no obligor has any defense, set off, claim or
counterclaim against the Borrower that can be asserted against Agent or any
Lender, whether in any proceeding to enforce Agent’s rights in the related
Mortgage Loan or otherwise, except to the extent that any such defense, setoff,
claim or counterclaim could not reasonably be expected to result in a Material
Adverse Change.

       

      (f)    The
Borrower has not assigned or otherwise delegated any of its obligations under
any Servicing Contract, other than pursuant to that certain Subservicing
Agreement, dated as of January 31, 2007 by and among CMC and Centerline
Servicing, Inc. (f/k/a ARCap Servicing, Inc.), a Delaware corporation (as
amended and/or restated from time to time), as disclosed on Schedule
5.22 hereof.

       

      5.25.    Special Representations
Concerning FHA Mortgage Loans.  The Borrower hereby represents
and warrants to Agent and the Lenders, as of the date of this Agreement and as
of the date of each Advance Request and the making of each Advance,
that:

       

      (a)    Each
FHA-insured Mortgage Loan included in the Pledged Loans meets in all material
respects all applicable Legal Requirements and any other governmental
requirements for such insurance.  The Borrower has complied and will
continue to comply in all material respects with all laws, rules and regulations
with respect to the FHA insurance of each Pledged Loan designated by the
Borrower as an FHA-insured Mortgage Loan, and such insurance is and will
continue to be in full force and effect.

       

       

       

       

      
        
          
          

        

        
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      (b)    For
FHA-insured Pledged Loans that will be used to back Ginnie Mae Mortgage-backed
Securities, the Borrower received from Ginnie Mae confirmation notices for
additional commitment authority and pool numbers, and there remains available
under those agreements a commitment on the part of Ginnie Mae sufficient to
permit the issuance of Ginnie Mae Mortgage-backed Securities in an amount at
least equal to the amount of the Pledged Loans designated by the Borrower as the
Mortgage Loans to be used to back those Ginnie Mae Mortgage-backed Securities;
each of those confirmation notices is in full force and effect; each of those
Pledged Loans has been assigned by the Borrower to one of those pool numbers and
a portion of the available Ginnie Mae commitment has been allocated to this
Agreement by the Borrower, in an amount at least equal to those Pledged Loans;
and each of those assignments and allocations has been reflected in the books
and records of the Borrower.

       

      5.26.    Ownership, Subsidiaries and
taxpayer identification numbers.

       

      (a)    All of
the stockholders of the Borrower and a description of the ownership interests
held by the same, and of each of the Borrower’s Subsidiaries, are listed on
Schedule
5.26 and no additional ownership interests, or rights or instruments
convertible into such ownership interests, exist.

       

      (b)    The
taxpayer identification numbers and state organizational numbers (if
applicable) of the foregoing Persons are accurately stated on Schedule
5.26.

       

      (c)    Borrower
is the owner, free and clear of all liens and encumbrances, of all of the issued
and outstanding capital stock, membership interests or other equity interests of
each of their respective Subsidiaries.

       

      5.27.    Material Adverse
Change.  There has been no Material Adverse Change since the
date of the latest financial statements delivered by the Borrower
hereunder.

       

      5.28.    Ongoing Representations and
Warranties.  Each request by the Borrower for an Advance:
(i) shall constitute an affirmation by the Borrower on behalf of itself
that the foregoing representations and warranties remain true and correct as of
the date of such request (except as to matters specifically disclosed in writing
to Agent and each of the Lenders prior to or simultaneously with such written
request, and except to the extent of changes resulting from transactions
contemplated and permitted by this Agreement and the other Loan Documents and
changes occurring in the ordinary course of business that singly or in the
aggregate are not materially adverse, and except to the extent that such
representations and warranties relate expressly to an earlier date) and,
unless Agent and each of the Lenders is notified to the contrary prior to the
disbursement of the requested Advance, will be so on the date of such Advance,
and (ii) shall constitute the representation and warranty of the Borrower
that the information set forth in each such request is true and correct and
omits no material fact necessary to make the same not misleading.

       

       

       

       

      
        
          
          

        

        
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      6.        AFFIRMATIVE
COVENANTS.

       

      The
Borrower hereby covenants and agrees with the Agent and the Lenders that, so
long as the Commitment is outstanding or there remain any Obligations of the
Borrower to be paid or performed under this Agreement or under any other Loan
Document, the Borrower shall:

       

                6.1.    Payment of
Notes.  Punctually pay or cause to be paid the principal of,
interest on and all other amounts payable hereunder and under the Notes in
accordance with the terms thereof.

       

                6.2.    Financial Statements and
Other Reports.  Deliver or cause to be delivered to the Agent
for the Borrower:

       

      (a)    As soon
as practicable, but in any event not later than sixty (60) days after the
end of each fiscal quarter of the Borrower (including for the fourth fiscal
quarter, which shall be subject to normal year end audit adjustments), the
management prepared consolidating balance sheet of the Borrower and its
Subsidiaries at the end of such quarter, and the related management prepared
consolidating statements of earnings for such quarter, each setting forth in
comparative form the figures for the same fiscal quarter of the previous fiscal
year and all such statements to be in reasonable detail, prepared in accordance
with GAAP.

       

      (b)    As soon
as practicable, but in any event not later than one hundred twenty (120) days
after the end of each fiscal year of the Borrower, the audited consolidated and
unaudited consolidating balance sheet of the Borrower and its Subsidiaries at
the end of such year, and the related statements of earnings and cash flows for
such year, each setting forth in comparative form the figures for the previous
fiscal year and all such statements to be in reasonable detail, prepared in
accordance with GAAP, and accompanied by an auditor’s report prepared without
qualification by an independent certified public accountant reasonably
acceptable to the Agent.

       

      (c)    Concurrently
with the delivery of the financial statements referred to in Sections 6.2
(a) and (b) above, a certificate (to be in the form of Exhibit
D or on such other form as the Agent may from time to time
prescribe) of an Authorized Representative stating that, to the best of
such Authorized Representative’s knowledge, the Borrower during such period
observed or performed in all material respects all of their covenants and other
agreements, and satisfied in all material respects every material condition,
contained in this Agreement or the other Loan Documents to be observed,
performed or satisfied by them, and that such Authorized Representative has
obtained no knowledge of any Default except as specified in such certificate and
such certificate shall include the calculations in reasonable detail required to
indicate the Borrower’s compliance with financial covenants set forth in
Article 7 hereof.

       

      (d)    As soon
as available and in any event within sixty (60) days after the end of each
fiscal quarter in the Borrower’s fiscal year, a consolidated loan production
report as of the end of that fiscal quarter, presenting the total dollar volume
and the number of Mortgage Loans originated and closed or purchased during that
fiscal quarter and for the fiscal year-to-date, specified by property type and
loan type.

       

      (e)    As soon
as available and in any event within 60 days after the end of each calendar
quarter, a consolidated report (“Servicing Portfolio Report”) as of the end of
the calendar quarter, as to all Mortgage Loans the servicing rights to which are
owned by the Borrower (specified by investor type, recourse and
non-recourse) regardless of whether the Mortgage Loans are Pledged
Loans.  The Servicing Portfolio Report must indicate which Mortgage
Loans (1) are current and in good standing, (2) are more than 30, 60
or 90 days past due, (3) are the subject of pending bankruptcy or
foreclosure proceedings, or (4) have been converted (through foreclosure or
other proceedings in lieu of foreclosure) into real estate owned by, the
Borrower.

       

       

       

       

      
        
          
          

        

        
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      (f)    At the
Agent’s request, a commitment summary and pipeline report dated as of the end of
such month and in form, substance and scope acceptable to the
Agent.

       

      (g)    Promptly
after the Borrower’s receipt thereof, copies of all accountants’ management
letters delivered to the Borrower or its Subsidiaries.

       

      (h)    Within
ten (10) days after filing, copies of all regular or periodic financial and
other reports, if any, which the Borrower shall file with the Securities and
Exchange Commission or any governmental agency successor thereto and copies of
any audits completed by Ginnie Mae, Freddie Mac, Fannie Mae, FHA, or
HUD.

       

      (i)    From time
to time, with reasonable promptness, such further information regarding the
business, operations, properties or financial condition of the Borrower as the
Agent may reasonably request.

       

      (j)    Within
three (3) Business Day of the Borrower’s receipt thereof, copies of any letters
or communications from Freddie Mac or Fannie Mae informing the Borrower of
events resulting in a reduction or dilution of business arrangements with such
entity.

       

      (k)    By no
later than the 15th day
of each calendar month beginning October 1, 2009, a copy of Fannie Mae’s DUS
watch list for mortgage loans serviced by CMC, including, without limitation,
information on loans that have matured or are in default, and special servicing
action plans related to the same.

       

      (l)    By no
later than the 15th day
of each calendar month beginning October 1, 2009, a copy of Freddie Mac’s Risk
Share watch list for mortgage loans serviced by CMP, including, without
limitation, information on loans that have matured or are in
default.

       

      6.3.   Maintenance of Existence;
Conduct of Business.  Preserve and maintain its corporate
existence in good standing and all of its rights, privileges, licenses and
franchises necessary in the normal conduct of its business, including, without
limitation, its eligibility as lender, seller/servicer and issuer described
under Section 5.11 hereof; conduct its business in an orderly and efficient
manner; maintain a net worth of acceptable assets as required by HUD at any and
all times for maintaining the Borrower’s status as a FHA approved mortgagee; and
make no material change in the nature or character of its business if it would
result in the Borrower engaging in a business other than the mortgage banking
business a majority of which shall focus on multifamily mortgages consistent
with its historical business.

       

      6.4.    Compliance with Applicable
Laws.  Comply with all Legal Requirements, a breach of which
could reasonably be expected to result in a Material Adverse Change, except
where contested in good faith and by appropriate proceedings, and with
sufficient reserves established therefor, and if at any time while any
Obligation is outstanding or the Lenders have any obligation to make Advances
hereunder, any authorizations from governmental authorities or other third party
consents, approvals, or notifications shall become necessary or required in
order that Borrower may pay or perform any of the Obligations, promptly take or
cause to be taken all reasonable steps within the power of Borrower to obtain
such authorizations, consents, approvals, or notifications, and furnish the
Agent and the Lenders with evidence thereof, unless the failure to do so could
not reasonably be expected to result in a Material Adverse Change.

       

       

       

       

      
        
          
          

        

        
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      6.5.    Inspection of Properties and
Books.  Permit authorized representatives of the Agent and any
Lender to (a) discuss the business, operations, assets and financial
condition of the Borrower and Borrower’s Subsidiaries with their officers and
employees and to examine their books of account, records, reports and other
papers and make copies or extracts thereof, and (b) inspect all of the
Borrower’s property and all related information and reports at the expense of
such Lender or Agent, as applicable, all at such reasonable times as the Agent
or any Lender may request.

       

      6.6.    Notice.  Give
prompt written Notice to the Agent of (a) any action, suit or proceeding
instituted by or against the Borrower or any of its Subsidiaries in any federal
or state court or before any commission or other regulatory body (federal, state
or local, domestic or foreign) which action, suit or proceeding has at issue in
excess of FIVE HUNDRED THOUSAND AND NO/100 DOLLARS ($500,000.00) (except for
normal collection and foreclosure proceedings initiated by the Borrower in
connection with a Mortgage Loan or any other Mortgage loan), or any such
proceedings threatened against the Borrower, or any of Borrower’s Subsidiaries
in writing containing the details thereof, (b) the filing, recording or
assessment of any federal, state or local tax Lien against it, or any of its
assets or any of its Subsidiaries, (c) the occurrence of any Event of
Default hereunder or the occurrence of any Default and continuation thereof for
five (5) days, (d) the suspension, revocation or termination of the
Borrower’s eligibility, in any respect, as approved lender, seller/servicer or
issuer as described under Section 5.11 hereof, (e) the transfer, loss
or termination of any Servicing Contract with an Investor to which the Borrower
is a party, or which is held for the benefit of the Borrower, and the reason for
such transfer, loss or termination, if known to the Borrower, (f) any change in
its accounting method as in effect on the date of this Agreement or change in
its fiscal year ending date from December 31, and (f) any other action,
event or condition of any nature which could reasonably be expected to result in
a Material Adverse Change.

       

      6.7.    Payment of Debt, Taxes,
etc.  Pay and perform all Indebtedness for money borrowed by
the Borrower having a principal amount of $500,000 or more, and cause to be paid
and performed all Indebtedness  for money borrowed by its Subsidiaries
having a principal amount of $500,000 or more in accordance with the terms
thereof and pay and discharge or cause to be paid and discharged all taxes,
assessments and governmental charges, tax Liens, or levies imposed upon the
Borrower or its Subsidiaries, or upon their respective income, receipts or
properties before the same shall become past due, as well as all lawful claims
for labor, materials and supplies or otherwise which, if unpaid, might become a
Lien or charge upon such properties or any part thereof; provided, however, that the
Borrower and its Subsidiaries shall not be required to pay obligation,
Indebtedness, taxes, assessments or governmental charges or levies or claims for
labor, materials or supplies for which the Borrower or its Subsidiaries shall
have obtained an adequate bond or adequate insurance or which are being
contested in good faith and by proper proceedings which are being reasonably and
diligently pursued if such proceedings do not involve any likelihood of the
sale, forfeiture or loss of any such property or any interest therein while such
proceedings are pending, and provided further that book reserves adequate under
GAAP shall have been established with respect thereto, to the extent required,
and provided further that the owing Person’s title to, and its right to use, its
property is not materially adversely affected thereby.

       

       

       

      
        
          
          

        

        
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      6.8.    Insurance.  Maintain
and cause each of its Subsidiaries to maintain insurance with respect to its
other properties with financially sound and reputable insurers, insurance with
respect to such properties and its business against such casualties and
contingencies as shall be in accordance with the general practices of businesses
engaged in similar activities in similar geographic areas and in amounts,
containing such terms, in such forms and for such periods as may be reasonable
and prudent.  Schedule
6.8 sets forth all insurance maintained by the Borrower at the date of
this Agreement.

       

      6.9.    Closing
Instructions.  Indemnify and hold the Agent and each Lender and
all those claiming by, through or under the Agent and each of the Lenders,
harmless from and against any loss, including reasonable
attorneys’ fees and costs, attributable to the failure of any title insurance
company, agent or approved attorney to comply with Borrower’s disbursement or
instruction letter relating to any Mortgage Loan.  Agent has the right
to pre-approve the Borrower’s disbursement or instruction letter to the title
insurance company, agent or approved attorney in any case in which the Borrower
intends to obtain a Advance against the Mortgage Loan to be created at
settlement or to pledge that Mortgage Loan as Collateral under this
Agreement.  The Borrower’s disbursement or instruction letter must
state that Agent, for the benefit of the Lenders has a security interest in any
amounts advanced to fund a Mortgage Loan and in the Mortgage Loan funded with
those amounts and must require the title insurance company, agent or approved
attorney involved in the transaction to return any amounts advanced by any
Lender and not used to fund the Mortgage Loan.

       

      6.10.    Other Loan
Obligations.  Perform all material obligations under the terms
of each loan agreement, note, mortgage, security agreement or debt instrument by
which the Borrower is bound or to which any of its property is subject, and
promptly notify the Agent in writing of a declared default under or the
termination, cancellation, reduction or non-renewal of any of its other lines of
credit or financing agreements with any other lender.  Schedule
6.10 hereto is a true and complete list of all such lines of credit or
financing agreements as of the date hereof.

       

      6.11.    Accounts. Maintain
the Operating Account, the Funding Account, and the Cash Collateral Account with
Agent.  Nothing herein shall be deemed to restrict the Borrower from
maintaining reserve or other accounts with other financial
institutions.

       

      6.12.    Special Affirmative
Covenants Concerning Collateral.

       

      (a)    Warrant
and defend the right, title and interest of the Agent and the Lenders in and to
the Collateral against the claims and demands of all Persons
whomsoever.

       

      (b)    Service
or cause to be serviced all Pledged Loans in accordance with the standard
requirements of the issuers of Purchase Commitments covering them and all
applicable HUD, Fannie Mae and Freddie Mac requirements, including taking all
actions necessary to enforce the obligations of the obligors under such Mortgage
Loans; and must service or cause to be serviced all Mortgage Loans backing
Pledged Securities in accordance with applicable governmental requirements and
requirements of issuers of Purchase Commitments covering them.

       

       

       

       

      
        
          
          

        

        
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      (c)    Execute
and deliver to the Agent such Uniform Commercial Code financing statements with
respect to the Collateral as the Agent may request.  The Borrower
shall also execute and deliver to the Agent such further instruments of sale,
pledge or assignment or transfer, and such powers of attorney, as reasonably
required by the Agent to secure the Collateral, and shall do and perform all
matters and things reasonably requested by the Agent that are necessary or
desirable to be done or observed, for the purpose of effectively creating,
maintaining and preserving a first priority security interest in the Collateral
and all other benefits intended to be afforded the Lenders under this
Agreement.  The Agent, on behalf of the Lenders, shall have all the
rights and remedies of a secured party under the Uniform Commercial Code of New
York, or any other applicable law, in addition to all rights provided for
herein.

       

      (d)    Notify
the Agent within two (2) Business Days after receipt of notice from an Investor
of any default under, or of the termination of, any Purchase Commitment relating
to any Pledged Loan, Eligible Mortgage Pool or Pledged Security.

       

      (e)    Promptly
comply in all respects with the terms and conditions of all Purchase
Commitments, and all extensions, renewals and modifications or substitutions
thereof or thereto.  The Borrower will cause to be delivered to the
Investor the Pledged Loans and Pledged Securities to be sold under each Purchase
Commitment not later than the mandatory delivery date of the Pledged Loans or
Pledged Securities under the Purchase Commitment.

       

      (f)    Maintain,
at its principal office at New York, New York, or its offices at Irving, Texas
and Jersey City, New Jersey (until such office is closed and moved to its
principal office at New York, New York), or at other offices approved by the
Agent, or in the office of a computer service bureau engaged by the Borrower and
approved by the Agent, and, upon request, shall make available to the Agent, for
the benefit of the Lenders, the originals, or copies in any case where the
originals have been delivered to the Agent, for the benefit of the Lenders, or
to an Investor, of its Mortgage Notes and Mortgages included in Collateral,
Mortgage-backed Securities delivered to the Agent, for the benefit of the
Lenders, as Pledged Securities, Purchase Commitments, and all related Mortgage
Loan documents and instruments, and all files, surveys, certificates,
correspondence, appraisals, computer programs, tapes, discs, cards, accounting
records and other information and data relating to the Collateral.

       

      (g)    Be in
good standing with Fannie Mae, Freddie Mac, Ginnie Mae, and FHA, except to the
extent related to programs in which the applicable Borrower has ceased to
originate Mortgage Loans and, in the case of Fannie Mae and Freddie Mac, such
cessation was not the result of a termination or other action by Fannie Mae,
Freddie Mac, Ginnie Mae, or FHA, as applicable.

       

      6.13.    Appraisals of Servicing
Portfolio.  Within forty-five (45) days after the end of each
calendar quarter ending September 30, provide to the Agent, at the Borrower’s
sole cost and expense, an annual appraisal of the Servicing Rights by Prestwick
Mortgage Group or any other Servicing Rights appraiser approved by Agent in
writing, such approval not be unreasonably withheld.

       

       

       

       

      
        
          
          

        

        
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      6.14.    Cure of Defects in Loan
Documents.  Promptly cure and cause to be promptly cured any
defects in the creation, issuance, execution and delivery of this Agreement and
the other Loan Documents; and upon request of the Agent and at the Borrower’s
expense, the Borrower will promptly execute and deliver, and cause to be
executed and delivered, to the Agent or its designee, all such additional
documents, agreements and/or instruments in compliance with or in accomplishment
of the covenants and agreements of this Agreement and the other Loan Documents,
and/or to create, perfect, preserve, extend and/or maintain any and all Liens
created pursuant hereto or pursuant to any other Loan Document as valid and
perfected Liens (of a priority as set forth in this Agreement) in favor of the
Agent for the benefit of the Lenders to secure the Obligations, all as
reasonably requested from time to time by the Agent.

       

      6.15.    Charging
Accounts.  Agent is hereby authorized, on or after the due
date, to charge the Operating Account and/or the Cash Collateral Account with
the amount of all principal and interest payments due under this Agreement, the
Notes or the other Loan Documents, and, in addition, upon the occurrence and
during the continuation of an Event of Default, the Agent is hereby authorized
on or after the due date, to charge the Operating Account and/or the Cash
Collateral Account with the amount of all unpaid fees, costs and expenses to
which the Agent and the Lenders are entitled under this
Agreement.  The failure of Agent to so charge any such account shall
not affect or limit the Borrower’s obligation to make any required
payment.

       

      7.        NEGATIVE
COVENANTS.

       

      The
Borrower hereby covenants and agrees with the Agent and the Lenders that, so
long as the Commitment is outstanding or there remain any Obligations of the
Borrower to be paid or performed under this Agreement or any other Loan
Document, the Borrower shall not, and shall not permit any of its Subsidiaries
to, without the prior written consent of the Agent:

       

      7.1.    Merger;
Acquisitions.  Become a party to any merger or consolidation,
or agree to or effect any asset acquisition or disposition or stock acquisition
or disposition (other than the acquisition or disposition of assets in the
ordinary course of business consistent with past practices, including the
acquisition or disposition of Mortgage Loans and property acquired on
foreclosure of Mortgages), except dispositions of Servicing Contracts in an
amount not to exceed five percent (5%) of the Servicing Portfolio during any
twelve (12) month period.

       

      7.2.    Loss of
Eligibility.  Take any action that would cause the Borrower to
lose all or any part of its status as an eligible lender, seller/servicer and
issuer as described under Section 5.11 hereof (except to the extent related
to programs in which the applicable Borrower has ceased to originate Mortgage
Loans and, in the case of Fannie Mae and Freddie Mac, such cessation was not the
result of a termination or other action by Fannie Mae, Freddie Mac, Ginnie Mae,
or FHA, as applicable).

       

      7.3.    Tangible Net Worth
(CMC).  Permit the Tangible Net Worth of CMC (and its
Subsidiaries, on a consolidated basis) to be less than the greater of
(x) $50,000,000.00 or (y) an amount sufficient to satisfy the
requirements from time to time of both Fannie Mae and Freddie Mac, to be tested
as of the Closing Date and on the last day of each calendar quarter
thereafter.

       

       

       

       

      
        
          
          

        

        
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      7.4.    Tangible Net Worth
(CMP).  Permit the Tangible Net Worth of CMP (and its
Subsidiaries, on a consolidated basis) to be less than the greater of
(x) $2,000,000.00 or (y) an amount sufficient to satisfy the
requirements from time to time to participate in any applicable Multifamily
Property program, to be tested as of the Closing Date and on the last day of
each calendar quarter thereafter.

       

      7.5.    Liquidity
(CMC).  Permit at any time the unrestricted cash and Cash
Equivalents of CMC (and its Subsidiaries, on a consolidated basis) to be less
than $500,000 plus 0.10% of the aggregate outstanding principal amount of the
aggregate of Serviced Loans serviced on behalf of Fannie Mae, or such higher
level as Fannie Mae may require from time to time.

       

      7.6.    Liquidity
(CMP).  Permit at any time the unrestricted cash and Cash
Equivalents of CMP (and its Subsidiaries, on a consolidated basis) to be less
than $200,000 calculated in a manner required for eligibility as a Freddie Mac
Program Seller/Servicer.

       

      7.7.    Limits on Corporate
Distributions.  Pay, make or declare or incur any liability to
pay, make or declare any dividend (excluding stock dividends) or other
distribution, direct or indirect, on or on account of any shares of its stock or
any redemption or other acquisition, direct or indirect, of any shares of its
stock or of any warrants, rights or other options to purchase any shares of its
stock nor purchase, acquire, redeem or retire any stock or ownership interest in
itself whether now or hereafter outstanding except that so long as no Default or
Event of Default exists at such time, or would exist immediately thereafter, the
Borrower may declare and pay cash dividends or distributions to its
shareholders.

       

      7.8.    Loans and
Advances.  Except as permitted in Section 7.10 and 7.17
hereof, make any loans or advances to any Person other than (a) Mortgage Loans,
(b) intercompany loans at a time when a Distribution would be permitted under
Section 7.7 hereof, or (c) advances to the Borrower’s or its Subsidiaries’
employees in the ordinary course of business for reasonable expenses to be
incurred by such employees for the benefit of the Borrower or such
Subsidiaries.  Notwithstanding the foregoing, the Borrower may
purchase and originate Mortgage Loans in the ordinary course of business
consistent with past practices.

       

      7.9.    No Investments Except
Approved Investments.  Without the prior written consent of
Agent, make or permit to remain outstanding any Investment except an Investment
which is in:

       

      (a)    Cash
Equivalents (provided, however, the Fannie Mae Reserve Account may be invested
for a period that exceeds 364 days); and

       

      (b)    Property
acquired in the normal and ordinary course of the Borrower’s present business of
originating and purchasing Mortgage Loans (including property acquired on
foreclosure of Mortgages and, as to the Borrower and its Subsidiaries, the
origination and purchase of Mortgage Loans in the ordinary course of their
business) as conducted on the date hereof and any other business permitted under
this Agreement.

       

       

       

       

      
        
          
          

        

        
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      7.10.    Charter Documents and
Business Termination.

       

      (a)    Issue,
sell or commit to issue or sell any shares of its or their capital stock of any
class, or other equity or investment security;

       

      (b)    Amend or
otherwise modify its or their corporate charter or otherwise change its or their
corporate structure in any manner which could reasonably be expected to result
in a Material Adverse Change; or

       

      (c)    Take any
action with a view toward its or their dissolution, liquidation or termination,
or, in fact, dissolve, liquidate or terminate its existence; or

       

      (d)    Change
its or their respective taxpayer identification numbers and state organizational
numbers unless such Person shall have provided the Agent with not less than
forty-five days prior written Notice.

       

      7.11.    Reserved.

       

      7.12.    No Sales, Leases or
Dispositions of Property.  Except in the ordinary course of its
business, sell, lease, transfer or otherwise dispose of (whether in one
transaction or a series of transactions) all or any substantial part of such
Person’s business or assets, whether now owned or acquired after the Closing
Date, other than, in the ordinary course of business consistent with past
practices and to the extent not otherwise prohibited by this Agreement, to a
Subsidiary of the Borrower, and sales of (1) Mortgage Loans,
(2) Mortgage-backed Securities, (3) Servicing Contracts (provided that
this provision shall not be deemed to restrict subservicing by an Affiliate of
the Borrower) and (4) other dispositions of Serviced Loans in an amount not
to exceed five percent (5%) of the Servicing Portfolio during any twelve
(12) month period.

       

      7.13.    Changes in Business or
Assets.  Cease actively to engage in the business of
originating or acquiring Mortgage Loans or make any other material change in the
nature or scope of the business in which each such Person engages as of the date
of this Agreement.

       

      7.14.    Changes in Office
Location.  Change the current addresses and/or locations of its
principal office at New York, New York, or its office where its principal
servicing activities are conducted at Irving, Texas, unless approved by the
Agent.

       

      7.15.    Special Negative Covenants
Concerning Collateral.

       

      (a)    Amend or
modify, or waive any of the terms and conditions of, or settle or compromise any
claim in respect of, any Pledged Assets, except for amendments to correct errors
and amendments or waivers which are not material to the applicable Pledged
Asset.

       

      (b)     Sell, assign,
transfer or otherwise dispose of, or grant any option with respect to, or pledge
or otherwise encumber (except pursuant to this Agreement or as permitted herein)
any of the Collateral or any interest therein.

       

      (c)    Make any
compromise, adjustment or settlement in respect of any of the Collateral or
accept other than cash in payment or liquidation of the Collateral.

       

       

       

       

      
        
          
          

        

        
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      7.16.    No
Indebtedness.  Create, incur, assume, guarantee or be or remain
liable, contingently or otherwise, with respect to any Indebtedness other
than:

       

      (a)    the
Obligations;

       

      (b)    current
liabilities of the Borrower or its Subsidiaries incurred in the ordinary course
of business but not incurred through (i) the borrowing of money, or
(ii) the obtaining of credit except for credit on an open account basis
customarily extended and in fact extended in connection with normal purchases of
goods and services;

       

      (c)    endorsements
of negotiable instruments for collection in the ordinary course of
business;

       

      (d)    secured
purchase money debt or capitalized lease obligations;

       

      (e)    Indebtedness
in respect of taxes, assessments, governmental charges or levies and claims for
labor, materials and supplies to the extent that payment therefor shall not at
the time be required to be made in accordance with the provisions of
Section 6.7 hereof;

       

      (f)    Indebtedness
of less than ONE MILLION FIVE HUNDRED THOUSAND AND NO/100 DOLLARS
($1,500,000.00), in the aggregate, incurred in the ordinary course of business
for capital expenditures;

       

      (g)    Indebtedness
secured by real property acquired upon foreclosure of Mortgages, which, either
(x) is so secured at the time of such acquisition, or (y) is directly
related to such real property, not in excess of the fair market value thereof,
and reasonably expected by the Borrower or the subject Subsidiary to be
recovered from the sale or other disposition of the subject real
property;

       

      (h)    unsecured
Indebtedness for borrowed money incurred in the ordinary course of business and
not exceeding $1,500,000, plus intercompany liabilities which have a maturity
date which is later than the Maturity Date and which are subordinated to the
Obligations pursuant to subordination agreements satisfactory to the Agent which
shall permit repayment as long as (A) no Default then exists, and
(B) no Default would thereupon occur (including on a pro forma basis as if
applicable financial covenants were tested as of the date of such
repayment;

       

      (i)    Indebtedness
(exclusive of the Indebtedness referred to in clause
(h) above) incurred to finance no greater than 100% of the purchase or
leasing of equipment, in the ordinary course of business;

       

      (j)    Indebtedness
to Fannie Mae, Freddie Mac, Ginnie Mae, FHA or other parties with whom the
Borrower and its Subsidiaries originate, sell, repurchase or service Mortgage
Loans (including Indebtedness under the ASAP and ASAP Plus programs), to the
extent directly relating to or arising out of such origination, sale,
repurchase, or servicing in the ordinary course of business consistent with past
practices;

       

      (k)    Indebtedness
in respect of judgments or awards that have been in force for less than the
applicable period for taking an appeal so long as execution is not levied
thereunder or in respect of which a Borrower shall at the time in good faith be
prosecuting an appeal or proceedings for review and in respect of which a stay
of execution shall have been obtained pending such appeal or
review;

       

       

       

       

      
        
          
          

        

        
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      (l)    Indebtedness
in respect of mortgage warehouse lines of credit on terms and conditions
consistent with the terms and conditions hereof, including, without limitation,
that the underlying mortgage loans made by Borrower under such warehouse lines
shall be entered into pursuant to unconditional purchase commitments from Fannie
Mae, Freddie Mac, Ginnie Mae, or other investors acceptable to the Agent in its
reasonable discretion;

       

      (m)    unsecured
Indebtedness in respect to reimbursement agreements entered into in connection
with the issuance of letters of credit to satisfy Borrower’s reimbursement
obligations to Freddie Mac and Fannie Mae, provided that the aggregate principal
balance of such unsecured Indebtedness shall not exceed $15,000,000.00;
and

       

      (n)    Indebtedness
existing on the date of this Agreement and listed and described on Schedule
7.16 hereto.

       

      7.17.    No
Liens.  Except in connection with its purchase, origination and
sale from time to time of Mortgage Loans and related assets in the ordinary
course of business as conducted on the date hereof, (a) create or incur or
suffer to be created or incurred or to exist any lien, encumbrance, mortgage,
pledge, charge, restriction or other security interest of any kind upon any of
its property or assets of any character whether now owned or hereafter acquired,
or upon the income or profits therefrom; (b) transfer any of its property
or assets or the income or profits therefrom for the purpose of subjecting the
same to the payment of Indebtedness or performance of any other obligation in
priority to payment of its general creditors; (c) acquire, or agree or have
an option to acquire, any property or assets upon conditional sale or other
title retention or purchase money security agreement, device or arrangement;
(d) suffer to exist for a period of more than thirty (30) days after the
same shall have been incurred any Indebtedness or claim or demand against it
that if unpaid might by law or upon bankruptcy or insolvency, or otherwise, be
given any priority whatsoever over its general creditors; or (e) pledge any
accounts, contract rights, general intangibles, chattel paper or instruments,
with or without recourse; (f) agree to a negative pledge in favor of any
Person other than the Agent or the Lenders pursuant to the Acquisition Facility
with respect to any assets or rights, now owned or hereafter arising provided
that the Borrower and any Subsidiary of the Borrower may create or incur or
suffer to be created or incurred or to exist:

       

      (a)    liens on
properties to secure taxes, assessments and other government charges or claims
for labor, material or supplies in respect of obligations not overdue or which
are being contested in good faith by appropriate proceedings for which adequate
reserves determined in accordance with GAAP have been established (and as to
which the property subject to any such lien is not yet subject to foreclosure,
sale, collection, levy or loss on account thereof);

       

      (b)    deposits
or pledges made in connection with, or to secure payment of, workmen’s
compensation, unemployment insurance, old age pensions or other social security
obligations;

       

       

       

       

      
        
          
          

        

        
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      (c)    liens on
properties the Indebtedness with respect to which is permitted by
Section 7.16 hereof;

       

      (d)    presently
outstanding liens listed on Schedule
7.17 hereto.

       

      (e)    liens in
favor of the Agent and the Lenders under the Loan Documents; liens securing
Indebtedness to Fannie Mae, Freddie Mac, Ginnie Mae, FHA or other parties with
whom the Borrower or its Subsidiaries originate, sell, repurchase or otherwise
service Mortgage Loans provided such liens relate to the foregoing transactions,
but only to the extent directly relating to or arising out of such origination,
sale, repurchase, or servicing in the ordinary course of business;

       

      (f)    liens
securing Indebtedness secured by real property acquired upon foreclosure of
Mortgages, which either (x) is so securing at the time of such acquisition,
or (y) is directly related to such real property, not in excess of the fair
market value thereof, and reasonably expected by the Borrower or the subject
Subsidiary to be recovered from the sale or other disposition of the subject
real property;

       

      (g)    liens
arising from good faith deposits in connection with or to secure performance of
tenders, bids, leases, government contracts, performance and return-of-money
bonds and other similar obligations incurred in the ordinary course of business
(other than obligations in respect of the payment of borrowed
money);

       

      (h)    easements,
rights-of-way, restrictions (including zoning restrictions), matters of plat,
minor defects or irregularities in title and other similar charges or
encumbrances not, in any material respect, impairing the use of the encumbered
property for its intended purposes;

       

      (i)    liens
securing Indebtedness permitted pursuant to Section 7.16(i), provided such
lien does not extend beyond the equipment which is the subject of the
Indebtedness; and

       

      (j)    liens in
favor of Ginnie Mae in connection with Ginnie Mae Mortgage Loans, provided such
liens relate to the subject Mortgage Loan.

       

      7.18.    Pledge of Servicing
Contracts.  Pledge or grant a security interest in any existing
or future Servicing Contracts of the Borrower (other than (i) to Agent or (ii)
to Bank of America, N.A, as administrative agent, under that certain Amended and
Restated Revolving Credit and Term Loan Agreement, dated as of December 19,
2008, by and among CHC and CCG, as the borrowers, the guarantors and lenders
party thereto from time to time and Bank of America, N.A., as administrative
agent on behalf of the lenders, as the same may be amended and/or restated from
time to time), or otherwise assign or delegate any of its obligations under any
Servicing Contract (other than pursuant to that certain Subservicing Agreement,
dated as of January 31, 2007 by and among CMC and Centerline Servicing, Inc.
(f/k/a ARCap Servicing, Inc.), a Delaware corporation (as amended and/or
restated from time to time), as disclosed on Schedule
5.22 hereof).  Notwithstanding the foregoing, nothing herein
shall give rise to or permit the grant of a security interest in any Servicing
Contract if the grant of a security interest therein is prohibited thereby or
would constitute a breach or default thereunder, or would result in the
termination thereof (including, by way of example, Servicing Contracts pursuant
to which CMC or CMP service Mortgage Loans transferred to Freddie Mac or Fannie
Mae).

       

       

       

       

      
        
          
          

        

        
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      7.19.    Recourse Servicing
Contracts.  Acquire or enter into Servicing Contracts under
which the Borrower must repurchase or indemnify the holder of the Mortgage Loans
as a result of defaults on the Mortgage Loans at any time during the term of
those Mortgage Loans, except for loss sharing under Fannie Mae DUS Mortgage
Loans, Freddie Mac loss sharing and FHA/Ginnie Mae coinsurance and as a result
of customary representations and warranties consistent with past practices in
the ordinary course of the Borrower’s business concerning the Mortgage
Loans.

       

      7.20.    Gestation
Agreements.  Directly or indirectly sell or finance a Mortgage
Loan under any Gestation Agreement if the Mortgage Loan is pledged to the Agent
as Collateral under this Agreement.

       

      7.21.    Minimum Servicing
Portfolio.  Permit the aggregate principal amount of the
Serviced Loans (exclusive of Serviced Loans which are sixty (60) days or more
past due or otherwise in default) to be less than SIX BILLION AND NO/100 DOLLARS
($6,000,000,000.00), computed as of the end of each calendar
quarter.

       

      7.22.    Maximum Serviced Loans
Delinquencies.  At no time shall the aggregate principal amount
of Serviced Loans as to which the Borrower has any loss sharing exposure which
are sixty (60) days or more past due or otherwise in default exceed 2% of
aggregate principal balances of all such Serviced Loans.

       

      7.23.    Subsidiaries.  The
Borrower hereby covenants and agrees that it shall not create, obtain, acquire,
suffer to exist or otherwise have any Subsidiaries, without the Agent’s prior
written consent (which consent may be withheld in the Agent’s unrestricted
discretion); provided, however, that the Borrower may acquire, form or otherwise
invest in a Subsidiary which engages in the mortgage banking business, and, with
respect to any such Subsidiary’s originations of Mortgage Loans in pursuit of
such business, a majority of such business shall focus on multi-family mortgages
consistent with the Borrower’s historic business.  Any Subsidiary so
created or acquired by the Borrower shall constitute a “Borrower” as referred to
herein.  The Borrower acknowledges and covenants that upon the
creation or acquisition of any new Subsidiary permitted hereby, the Borrower
shall provide at least 30 days prior written notice of the creation or
acquisition thereof, and at the Agent’s option such Subsidiary shall execute and
deliver to the Agent an agreement reasonably satisfactory to the Agent under
which such Subsidiary joins this Agreement as a Borrower.

       

      8.       DEFAULTS;
REMEDIES.

       

                8.1.    Events of
Default.  The occurrence of any of the following conditions or
events shall be an event of default (“Event of Default”):

       

      (a)    Failure
to pay the principal of any Advance when due, whether at stated maturity, by
acceleration, or otherwise; or failure to pay any installment of interest on any
Advance or any other amount due under this Agreement within ten (10) days after
the due date; or

       

       

       

       

      
        
          
          

        

        
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      (b)    Failure
of the Borrower or any of its Subsidiaries to pay, or any default in the payment
of any principal or interest on, any other Indebtedness for money borrowed
beyond any period of grace provided; or breach or default with respect to any
other material term of any other Indebtedness for money borrowed under any loan
agreement, mortgage, indenture or other agreement relating thereto, if the
effect of such failure, default or breach is to cause, or to permit the holder
or holders thereof (or a trustee on behalf of such holder or holders) to cause,
Indebtedness of the Borrower or its Subsidiaries for money borrowed in the
aggregate amount of FIVE HUNDRED THOUSAND AND NO/100 DOLLARS ($500,000.00) or
more to become or be declared due prior to its stated maturity (upon the giving
or receiving of Notice, lapse of time, both, or otherwise); or

       

      (c)    (i)
Borrower shall fail to comply with (y) the provisions of clauses (a) through (e)
inclusive of Section 7.17 with respect to any lien not resulting from a
voluntary action by the Borrower within five (5) days from the date of the
Agent’s written notice to the Borrower informing the Borrower of the failure to
have so complied with said provisions, or (z) the covenants set forth in
Sections 7.1 through 7.23 (other than as set forth in clause (i)(y) of this
Section with respect to Section 7.17), or (ii) any of the Borrower’s
representations or warranties made or deemed made herein or in any other Loan
Document, or in any statement or certificate at any time given by the Borrower
in writing pursuant hereto or thereto shall be inaccurate or incomplete in any
materially adverse respect on the date as of which made or deemed made;
or

       

      (d)    The
Borrower shall default in the performance of or compliance with any term or
covenant contained in this Agreement and such default shall not have been
remedied or waived within thirty (30) days after receipt of written Notice from
the Agent of such default other than those referred to above in
Subsections 8.1(a), 8.1(b), or 8.1(c); or

       

      (e)    (1) A
court having jurisdiction shall enter a decree or order for relief in respect of
the Borrower or any of Borrower’s Subsidiaries in an involuntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter in
effect in respect of the Borrower or any of Borrower’s Subsidiaries, which
decree or order is not stayed; or a filing of an involuntary case under any
applicable bankruptcy, insolvency or other similar law in respect of the
Borrower or any of Borrower’s Subsidiaries has occurred; or (2) any other
similar relief shall be granted under any applicable federal or state law; or a
decree or order of a court having jurisdiction for the appointment of a
receiver, liquidator, sequestrator, trustee, custodian or other officer having
similar powers over the Borrower or any of Borrower’s Subsidiaries, or over all
or a substantial part of their respective property, shall have been entered; or
the involuntary appointment of an interim receiver, trustee or other custodian
of the Borrower or any of Borrower’s Subsidiaries, for all or a substantial part
of their respective property; or the issuance of a warrant of attachment,
execution or similar process against any substantial part of the property of the
Borrower or any of Borrower’s Subsidiaries, and the continuance of any such
events in Subsections (1) and (2) above for sixty (60) days unless
dismissed or discharged; or

       

      (f)    The
Borrower or any of Borrower’s Subsidiaries shall have an order for relief
entered with respect to it or commence a voluntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, or shall
consent to the entry of an order for relief in an involuntary case, or to the
conversion to an involuntary case, under any such law, or shall consent to the
appointment of or taking possession by a receiver, trustee or other custodian
for all or a substantial part of its property; the making by the Borrower or any
of Borrower’s Subsidiaries of any assignment for the benefit of creditors; or
the failure of the Borrower or any of Borrower’s Subsidiaries, or the admission
by any of them of its inability, to pay its debts as such debts become due;
or

       

       

       

       

      
        
          
          

        

        
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      (g)    Any money
judgment, writ or warrant of attachment, or similar process involving in any
case an amount in excess of FIVE HUNDRED THOUSAND AND NO/100 DOLLARS
($500,000.00) which has been denied coverage under the Borrower’s insurance
policies, as applicable, shall be entered or filed against the Borrower or any
of its Subsidiaries or any of their respective assets and shall remain
undischarged, unvacated, unbonded or unstayed for a period of thirty (30) days
or in any event no later than five (5) days prior to the date of any proposed
sale thereunder; or

       

      (h)    Any
order, judgment or decree shall be entered against the Borrower decreeing the
dissolution or split up of the Borrower and such order shall remain undischarged
or unstayed for a period in excess of forty-five (45) days; or

       

      (i)    Any Plan
maintained by the Borrower or any of Borrower’s Subsidiaries shall be terminated
within the meaning of Title IV of ERISA or a trustee shall be appointed by an
appropriate United States district court to administer any Plan, or the Pension
Benefit Guaranty Corporation (or any successor thereto) shall institute
proceedings to terminate any Plan or to appoint a trustee to administer any Plan
if as of the date thereof the Borrower’s or any Subsidiary’s liability (after
giving effect to the tax consequences thereof) to the Pension Benefit Guaranty
Corporation (or any successor thereto) for unfunded guaranteed vested benefits
under the Plan exceeds the then current value of assets accumulated in such Plan
by more than FIFTY THOUSAND AND NO/100 DOLLARS ($50,000.00) (or in the case of a
termination involving the Borrower or any of Borrower’s Subsidiaries as a
“substantial employer” (as defined in Section 4001(a)(2) of ERISA) the
withdrawing employer’s proportionate share of such excess shall exceed such
amount); or

       

      (j)    The
Borrower or any of Borrower’s Subsidiaries as employer under a Multiemployer
Plan shall have made a complete or partial withdrawal from such Multiemployer
Plan and the plan sponsor of such Multiemployer Plan shall have notified such
withdrawing employer that such employer has incurred a withdrawal liability in
an annual amount exceeding FIFTY THOUSAND AND NO/100 DOLLARS ($50,000.00);
or

       

      (k)    The
Borrower shall contest the validity or enforceability hereof, or the Agent’s
security interest on any portion of the Collateral shall become unenforceable or
otherwise impaired; provided that, subject to the Agent’s approval, no Event of
Default shall occur and be continuing as a result of such impairment if all
Advances made against any such Collateral shall be paid in full within ten (10)
days of the date of such impairment; or

       

      (l)    The
Borrower dissolves or terminates its existence, or discontinues its business of
engaging in the mortgage banking business, a majority of which shall focus on
multifamily mortgage loans consistent with its historical business;
or

       

       

       

       

      
        
          
          

        

        
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      (m)    Any court
shall find or rule, or the Borrower shall assert or claim, (i) that the
Agent does not have a valid, first priority perfected, enforceable Lien and
security interest in the Collateral as represented in this Agreement or in any
other Loan Document, or (ii) that this Agreement or any of the Loan
Documents does not or will not constitute the legal, valid, binding and
enforceable obligations of the party or parties (as applicable) thereto, or
(iii) that any Person has a conflicting or adverse Lien, claim or right in,
or with respect to, the Collateral and the Borrower is unable within ten (10)
days to have such finding or ruling reversed or to have such adverse Lien, claim
or right removed; or

       

      (n)    The
Borrower shall have concealed, removed, or permitted to be concealed or removed,
any part of its property, with intent to hinder, delay or defraud its creditors
or any of them, or made or suffered a transfer of any of its property which may
be fraudulent under any bankruptcy, fraudulent conveyance or similar law; or
shall have made any transfer of its property to or for the benefit of a creditor
at a time when other creditors similarly situated have not been paid; or shall
have suffered or permitted, while insolvent, any creditor to obtain a Lien upon
any of its property through legal proceedings or other process which is not
vacated within sixty (60) days from the date thereof; or

       

      (o)    Borrower
or its Subsidiaries shall be indicted for a federal crime, a punishment for
which could include the forfeiture of any assets of Borrower or its
Subsidiaries; or

       

      (p)    A Change
in Control shall occur; or

       

      (q)    A
Material Adverse Change shall occur; or

       

      (r)    Failure
of CHC or CCG to pay, or any default in the payment of any principal or interest
on, any indebtedness for borrowed money beyond any period of grace provided; or
breach or default with respect to any other material term of any other
indebtedness for money borrowed under the loan agreement, mortgage, indenture or
other agreement relating thereto, if the effect of such failure, default or
breach is to cause, or to permit the holder or holder thereof (or a trustee on
behalf of such holder or holders) to cause, such indebtedness of CHC or CCG to
become or be declared due prior to its stated maturity (upon the giving or
receiving of Notice, lapse of time, both or otherwise).

       

      If an
Event of Default is waived by the Majority Lenders (or all of the Lenders if and
to the extent required by the terms hereof), in their sole discretion, pursuant
to a specific written instrument executed by an authorized officer of Agent, the
Event of Default so waived shall be deemed to have never occurred.

       

      8.2.     Remedies.

       

      (a)    Upon the
occurrence of any Event of Default described in Sections 8.1(e), 8.1(f), 8.1(h)
or 8.1(k), the Commitment shall automatically terminate and all unpaid and
accrued Obligations of the Borrower shall automatically become due and payable,
without Notice, presentment for payment, demand, notice of non-payment, protest,
notice of protest, notice of intent to accelerate, notice of acceleration,
maturity, or any other Notices or requirements of any kind to the Borrower or
any other Person liable thereon or with respect thereto, all of which are hereby
expressly waived by the Borrower.

       

       

       

       

      
        
          
          

        

        
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      (b)    Upon the
occurrence of any Event of Default, other than those described in Sections
8.1(e), 8.1(f), 8.1(h) or 8.1(k), the Agent may, by written Notice to the
Borrower, terminate the Commitment and/or declare all unpaid and accrued
Obligations of the Borrower to be immediately due and payable, whereupon the
same shall forthwith become due and payable, together with all accrued and
unpaid interest thereon, and the obligation of the Lenders to make any Advances
shall thereupon terminate.

       

      (c)    Upon the
occurrence of any Event of Default, the Agent may also do any of the
following:

       

      1.    Foreclose
upon or otherwise enforce its security interest in and Lien on the Collateral to
secure all payments and performance of Obligations of the Borrower in any manner
permitted by law or provided for hereunder.

       

      2.    Notify
all obligors, servicers or other Persons in respect of the Collateral that the
Collateral has been assigned to the Agent, for the benefit of the Lenders, and
that all payments thereon are to be made directly to the Agent, for the benefit
of the Lenders, or such other party as may be designated by the Agent; settle,
compromise, or release, in whole or in part, any amounts owing on the
Collateral, any such obligor or any Investor or any portion of the Collateral,
on terms acceptable to the Agent; enforce payment and prosecute any action or
proceeding with respect to any and all Collateral; and where any such Collateral
is in default, foreclose on and enforce security interests in, such Collateral
by any available judicial procedure or without judicial process and sell
property acquired as a result of any such foreclosure.

       

      3.    Act, or
contract with a third Person to act, as servicer or subservicer of each item of
Collateral requiring servicing and perform all obligations required in
connection with Purchase Commitments, such third party’s fees to be paid by the
Borrower.

       

      4.    Require
the Borrower to assemble the Collateral and/or books and records relating
thereto and make such available to the Agent at a place to be designated by the
Agent.

       

      5.    Enter
onto property where any Collateral or books and records relating thereto are
located and take possession thereof with or without judicial
process.

       

      6.    Prior to
the disposition of the Collateral, prepare it for disposition in any manner and
to the extent the Agent deems appropriate.

       

      7.    Exercise
all rights and remedies of a secured creditor under the Uniform Commercial Code
of New York or other applicable law, including, but not limited to, selling or
otherwise disposing of the Collateral, or any part thereof, at one or more
public or private sales, whether or not such Collateral is present at the place
of sale, for cash or credit or future delivery, on such terms and in such manner
as the Agent may determine, including, without limitation, sale pursuant to any
applicable Purchase Commitment.  If notice is required under such
applicable law, the Agent will give the Borrower not less than ten (10) days’
Notice of any such public sale or of the date after which private sale may be
held.  The Borrower agrees that ten (10) days’ Notice shall be
commercially reasonable notice.  The Agent may, without Notice or
publication, adjourn any public or private sale or cause the same to be
adjourned from time to time by announcement at the time and place fixed for the
sale, and such sale may be made at any time or place to which the same may be so
adjourned.  The Agent is authorized at any such sale, if the Agent
deems it advisable so to do, to restrict the prospective bidders or purchasers
to Persons who will represent and agree that they are purchasing the Collateral
for their own account for investment and not with a view to the distribution or
resale of any of the Collateral.  The Borrower specifically agrees
that any such sale, whether public or private, of any Collateral pursuant to the
commitment of any investor to purchase such Collateral that was obtained by (or
with the approval of) the Borrower will be commercially reasonable, and if such
sale is for the price provided for in such commitment, then such sale shall be
held to be for value reasonably equivalent to the value of the Collateral so
sold.  Upon any such sale, the Agent shall have the right to deliver,
assign and transfer to the purchaser thereof the Collateral so
sold.  Each purchaser at any such sale shall hold the property sold
absolutely free from any claim or right of whatsoever kind, including any equity
or right of redemption, stay or appraisal which the Borrower has or may have
under any rule of law or statute now existing or hereafter
adopted.  In any case of any sale of all or any part of the Collateral
on credit or for future delivery, the Collateral so sold may be retained by the
Agent until the selling price is paid by the purchaser, but the Agent shall not
incur any liability in case of such purchaser’s failure to take up and pay for
the Collateral so sold and, in case of any such failure, such Collateral may
again be sold upon like Notice.  In case of any sale of all or any
part of the Collateral on credit or for future delivery, the Collateral so sold
may be retained by the Agent until the selling price is paid by the purchaser
thereof, but the Agent shall not incur any liability in case of the failure of
such purchaser to take up and pay for the Collateral so sold and, in case of any
such failure, such Collateral may again be sold upon like Notice.  The
Agent may, however, instead of exercising the power of sale herein conferred
upon it, proceed by a suit or suits at law or in equity to collect all amounts
due upon the Collateral or to foreclose the pledge and sell the Collateral or
any portion thereof under a judgment or decree of a court or courts of competent
jurisdiction, or both.

       

       

       

       

      
        
          
          

        

        
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      8.    Proceed
against the Borrower on the Notes.

       

      9.    Exercise
any or all of its rights, remedies or recourses under any other Loan Documents,
at law, in equity, or otherwise.

       

      (d)    Neither
the Agent nor any Lender shall incur any liability as a result of the sale or
other disposition of the Collateral, or any part thereof, at any public or
private sale or disposition.  The Borrower hereby waives (to the
extent permitted by law) any claims it may have against the Agent and the
Lenders arising by reason of the fact that the price at which the Collateral may
have been sold at such private sale was less than the price which might have
been obtained at a public sale or was less than the aggregate amount of the
outstanding Advances and the unpaid interest accrued thereon, even if the Agent
accepts the first offer received and does not offer the Collateral to more than
one offeree and none of the actions described herein shall render Agent’s
disposition of the Collateral in such a manner as commercially
unreasonable.  Any sale of Collateral pursuant to the terms of a
Purchase Commitment, or any other disposition of collateral arranged by the
Borrower, whether before or after the occurrence of an Event of Default, shall
be deemed to have been made in a commercially reasonable manner.

       

       

       

       

      
        
          
          

        

        
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      (e)    In
connection with any sale of the Collateral pursuant to the terms of a Purchase
Commitment, Agent may, without liability to the Borrower or any other Person,
continue to transmit Pledged Loans or Pledged Securities, together with all
related loan documents and pool documents in Agent’s possession, to the
applicable Investor, Approved Custodian or other party acceptable to Agent in
its sole discretion.

       

      (f)    The
Borrower specifically waives (to the extent permitted by law) any equity or
right of redemption, all rights of redemption, stay or appraisal which the
Borrower has or may have under any rule of law or statute now existing or
hereafter adopted, and any right to require the Agent to (1) proceed
against any Person, (2) proceed against or exhaust any of the Collateral or
pursue its rights and remedies as against the Collateral in any particular
order, or (3) pursue any other remedy in its power.  The Agent
shall not be required to take any steps necessary to preserve any rights of the
Borrower against holders of mortgages prior in lien to the Lien of any Mortgage
included in the Collateral or to preserve rights against prior
parties.

       

      (g)    The
Lenders may, but shall not be obligated to, advance any sums or do any act or
thing necessary to uphold and enforce the Lien and priority of, or the security
intended to be afforded by, any Mortgage included in the Collateral, including,
without limitation, payment of delinquent taxes or assessments and insurance
premiums.  All advances, charges, costs and expenses, including
reasonable attorneys’ fees and disbursements, incurred or paid by the Lenders in
exercising any right, power or remedy conferred by this Agreement, or in the
enforcement hereof, together with interest thereon, at the Default Rate, from
the time of payment until repaid, shall become a part of the principal balance
outstanding hereunder and under the Notes.

       

      (h)    No
failure on the part of the Agent to exercise, and no delay in exercising, any
right, power or remedy provided hereunder, at law or in equity shall operate as
a waiver thereof; nor shall any single or partial exercise by the Agent of any
right, power or remedy provided hereunder, at law or in equity preclude any
other or further exercise thereof or the exercise of any other right, power or
remedy.  Without intending to limit the foregoing, all defenses based
on the statute of limitations are hereby waived by the Borrower to the extent
permitted by law.  The remedies herein provided are cumulative and are
not exclusive of any remedies provided at law or in equity.

       

      8.3.      Application of
Proceeds.  The proceeds of any sale, disposition or other
enforcement of the security interest in all or any part of the Collateral shall
be applied by the Agent as follows:

       

      First, to
the payment of the costs and expenses of such sale or enforcement, including
reasonable compensation to the Agent’s agents and counsel, and all expenses,
liabilities and advances made or incurred by or on behalf of the Agent in
connection therewith;

       

      Second,
to the payment of all amounts due (other than principal and interest) under the
Notes or this Agreement ─ payable ratably to Lenders in the proportion that each
Lender’s share of those amounts bears to the total of those amounts for all
Lenders;

       

       

       

       

      
        
          
          

        

        
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      Third, to
the payment of interest accrued and unpaid on the Notes ─ payable ratably to
each Lender in accordance with its Commitment Percentage;

       

      Fourth,
on a pari passau basis, to (a) to all Lenders in accordance with their
proportional share based upon their respective Commitment Percentages until all
Lenders have been paid in full all principal due to the Lenders under the Loan,
and (b) to the counterparty on any Hedging Arrangements between the Borrower and
a Lender (or an Affiliate of a Lender) solely with respect to Advances made
hereunder, until all Obligations thereunder have been paid in full;

       

      Fifth, to
the payment of all other Obligations payable ratably to Lenders in the
proportion that each Lender’s share of those amounts bears to the total of those
amounts for all Lenders; and

       

      Finally,
to the payment to the Borrower, or to its successors or assigns, or as a court
of competent jurisdiction may direct, of any surplus then remaining from such
proceeds.

       

      If the
proceeds of any such sale, disposition or other enforcement are insufficient to
cover the costs and expenses of such sale, as aforesaid, and the payment in full
of all Obligations of the Borrower, the Borrower shall remain liable for any
deficiency.

      

      8.4.    Agent Appointed
Attorney-in-Fact.  The Agent is hereby appointed the
attorney-in-fact of the Borrower, with full power of substitution, for the
purpose of carrying out the provisions hereof and taking any action and
executing any instruments which the Agent may deem necessary or advisable to
accomplish the purposes hereof, which appointment as attorney-in-fact is
irrevocable and coupled with an interest and shall remain in full force and
effect until the full and final payment and performance of all
Obligations.  Without limiting the generality of the foregoing, the
Agent shall have the right and power, either in the name of the Borrower or in
its own name, to (a) give notices of its security interest in the Collateral to
any Person, (b) endorse in blank, to itself, or to a nominee all items of
Collateral that are transferable by endorsement and are payable to the order of
the Borrower, including canceling, completing or supplying any needed or
incomplete or missing endorsement of the Borrower and any related assignment,
(c) change or cause to be changed the book-entry registration or name of
subscriber or Investor on any Pledged Security, and (d) receive, endorse and
collect all checks made payable to the order of the Borrower representing any
payment on account of the principal of or interest on, or the proceeds of sale
of, any of the Pledged Loans or Pledged Securities and to give full discharge
for the same.

       

      8.5.    Right of
Offset.  Borrower hereby grants to Agent and to each Lender a
right of offset, subject to the following sentence relating to any exercise of
such right, to secure the repayment of the Obligations, upon any and all monies,
securities, or other property of Borrower, and the proceeds therefrom now or
hereafter held or received by or in transit to Agent or such Lender from or for
the account of Borrower, whether for safekeeping, custody, pledge, transmission,
collection, or otherwise, and also upon any and all deposits (general or
special, time or demand, provisional or final) and credits of Borrower, and any
and all claims of Borrower against Agent or such Lender, at any time
existing.  Upon the occurrence of any Default, Agent and each Lender
are authorized at any time and from time to time, without Notice to Borrower, to
offset, appropriate, and apply any and all of those items against the
Obligations.  Notwithstanding anything in this section or elsewhere in
this Agreement to the contrary, neither Agent nor any other Lender shall have
any right to offset, appropriate, or apply any accounts of Borrower which
consist of escrowed funds (except and to the extent of any beneficial interest
which Borrower have in such escrowed funds) which have been so identified by
Borrower in writing at the time of deposit thereof.

       

       

       

       

      
        
          
          

        

        
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      8.6.    Waivers.  Borrower
waives any right to require Agent to (a) proceed against any Person,
(b) proceed against or exhaust any of the Collateral or pursue its rights
and remedies as against the Collateral in any particular order, or
(c) pursue any other remedy in its power.  Agent shall not be
required to take any steps necessary to preserve any rights of Borrower against
any Person from which Borrower purchased any Mortgage Loans or to preserve
rights against prior parties.  Borrower and each surety, endorser,
guarantor, pledgor, and other party ever liable or whose property is ever liable
for payment of any of the Obligations jointly and severally waive presentment
and demand for payment, protest, notice of intention to accelerate, notice of
acceleration, and notice of protest and on payment, and agree that their or
their property’s liability with respect to the Obligations, or any part thereof,
shall not be affected by any renewal or extension in the time of payment of the
Obligations, by any indulgence, or by any release or change in any security for
the payment of the Obligations, and hereby consent to any and all renewals,
extensions, indulgences, releases, or changes, regardless of the number
thereof.

       

      8.7.    Performance by
Agent.  Should any covenant, duty, or agreement of Borrower
fail to be performed in accordance with the terms of this Agreement or of any
document delivered under this Agreement, Agent may, at its option, after Notice
to Borrower, as the case may be, perform, or attempt to perform, such covenant,
duty, or agreement on behalf of the Borrower and shall notify each Lender that
it has done so.  In such event, Borrower shall jointly and severally,
at the request of Agent, promptly pay any amount expended by Agent in such
performance or attempted performance to Agent at its principal place of
business, together with interest thereon at the Maximum Rate from the date of
such expenditure by Agent until paid.  Notwithstanding the foregoing,
it is expressly understood that Agent does not assume and shall never have,
except by express written consent of Agent, any liability or responsibility for
the performance of any duties of Borrower under this Agreement or under any
other document delivered under this Agreement.

       

      8.8.    No
Responsibility.  Except in the case of fraud, gross negligence,
or willful misconduct, neither Agent nor any of its officers, directors,
employees, or attorneys shall assume or ever have any liability or
responsibility for, any diminution in the value of the Collateral or any part of
the Collateral.

       

      8.9.    No
Waiver.  The acceptance by Agent or any Lender at any time and
from time to time of partial payment or performance by Borrower of any of their
respective obligations under this Agreement or under any Loan Document shall not
be deemed to be a waiver of any Default then existing.  No waiver by
Agent or any Lender shall be deemed to be a waiver of any other then existing or
subsequent Default.  No delay or omission by Agent or any Lender in
exercising any right under this Agreement or under any other document required
to be executed under or in connection with this Agreement shall impair such
right or be construed as a waiver thereof or any acquiescence therein, nor shall
any single or partial exercise of any such right preclude other or further
exercise thereof, or the exercise of any other right under this Agreement or
otherwise.

       

       

       

       

      
        
          
          

        

        
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      8.10.   Cumulative
Rights.  All rights available to Agent and the Lenders under
this Agreement or under any other document delivered under this Agreement shall
be cumulative of and in addition to all other rights granted to Agent and the
Lenders at law or in equity, whether or not the Notes be due and payable and
whether or not Agent shall have instituted any suit for collection, foreclosure
or other action in connection with this Agreement or any other document
delivered under this Agreement.

       

      9.       NOTICES.

       

      All
notices, demands, consents, requests and other communications required or
permitted to be given or made hereunder (collectively, “Notices”) shall, except
as otherwise expressly provided hereunder, be in writing addressed to the
respective parties hereto at their respective addresses hereinafter set forth
and shall be either (a) delivered in person, or (b) mailed, by
certified, registered, or express mail, postage prepaid, or (c) delivered
by overnight courier, or (d) telecopied to their respective telecopy
numbers (with a paper copy mailed the same day as aforesaid) as hereinafter set
forth; provided any party may change its address for Notice by designating such
party’s new address in a Notice to the sending party given at least five (5)
Business Days before it shall become effective.  All Notices shall be
conclusively deemed to have been properly given or served when duly received, in
person regardless of how sent.  Regardless of when received, all
Notices shall be conclusively deemed given or served if addressed in accordance
with this Section and (1) if by overnight courier, on the next Business Day
or (2) if mailed, by certified, registered, or express mail, postage
prepaid, on the third Business Day after being deposited in the mails, or
(3) if telecopied, when telecopied to the telecopy number set forth below
(provided a paper copy is mailed the same day):

       

      If to the
Borrower:                    Centerline
Mortgage Capital Inc.

      Attn:  Chief Financial
Officer

      625 Madison Avenue

      New York, New York 10022

      Fax No.: 212-751-3550

      E-mail:
rlevy@centerline.com

       

       

       

       

      
        
          
          

        

        
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      with a copy
to:                          Centerline
Mortgage Capital Inc.

      Attn:  General
Counsel

      625 Madison Avenue

      New York, New York 10022

      Fax No.: 212-751-3550

      E-mail:
jdamico@centerline.com

      

      and

      

      Proskauer Rose LLP

      Attn:  Steven A.
Fishman

      1585 Broadway

      New York, NY 10022

      Fax
No.  212-969-2900

      E-mail:
safishman@proskauer.com

      

      If to
Agent:                               Bank
of America, N.A.

      Attn:  John F. Simon, Senior
Vice President

      One Federal Street, Fourth
Floor

      Mail Code: MA5-503-04-16

      Boston, MA 02110

      Fax No.: 617 346 4670

      E-mail:  john.f.simon@bankofamerica.com

       

      with a copy
to:                          Nutter,
McClennen & Fish, LLP

      Attn:  Stephen J.
Patterson

      World Trade Center West

      155 Seaport Boulevard

      Boston, MA 02210

      Fax No.: 617 310 9827

      E-mail:
spatterson@nutter.com

      

      If to a
Lender, to such address for such Lender as appears on Schedule
1.

       

      10.     REIMBURSEMENT
OF EXPENSES; INDEMNITY.

       

      10.1. 
Reimbursement of Expenses
and Indemnification by Borrower.  The Borrower shall pay
(promptly upon receipt of an invoice therefore): (a) all the actual and
reasonable out-of-pocket costs and expenses of preparation of the Loan Documents
and any consents, amendments, waivers, or other modifications thereto; (b) the
reasonable fees, expenses, and disbursements of counsel to the Agent in
connection with the negotiation, preparation, execution, and administration of
the Loan Documents and any consents, amendments, waivers, or other modifications
thereto and any other documents or matters requested by the Borrower; (c) all
other actual and reasonable out-of-pocket costs and expenses incurred by the
Agent in connection with the establishment of the Loan, the syndication of the
Commitment and the negotiation, preparation, and execution of the Loan Documents
and any consents, amendments, waivers, or other modifications thereto and the
transactions contemplated thereby (including, without limitation, any Temporary
Increases); (d) all reasonable out-of-pocket expenses (including reasonable
attorneys’ fees and costs, which attorneys may be employees of the Agent or any
Lender and the fees and costs of appraisers, brokers, investment bankers or
other experts retained by the Agent or any Lender) incurred by the Agent or any
Lender in connection with (i) the enforcement of or preservation of rights under
any of the Loan Documents against the Borrower or any other Person, or the
administration thereof, (ii) any refinancing or restructuring of the credit
arrangements provided under this Agreement in the nature of a so-called
“work-out” or pursuant to any insolvency or bankruptcy proceedings, and (iii)
any litigation, proceeding or dispute whether arising hereunder or otherwise, in
any way related to the Agent’s or any Lender’s relationship with the Borrower,
except to the extent arising out of the Agent’s or any Lender’s bad faith, gross
negligence, willful misconduct or material breach of this Agreement or any other
Loan Document, as finally determined by a court of competent
jurisdiction.  The covenants of this Section shall survive payment or
satisfaction of payment of amounts owing with respect to the
Notes.  The amount of all such expenses shall, until paid, bear
interest at the rate applicable to principal hereunder (including the Default
Rate) and be an Obligation secured by any Collateral.

       

       

       

       

      
        
          
          

        

        
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      10.2.    INDEMNIFICATION BY THE
BORROWER.  THE
BORROWER SHALL INDEMNIFY, PAY AND HOLD HARMLESS THE AGENT, EACH LENDER, AND ANY
OF THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES OR AGENTS AND ANY SUBSEQUENT
OWNERS OR HOLDERS OF THE NOTES (COLLECTIVELY, THE “INDEMNIFIED PARTIES”) FROM
AND AGAINST ANY AND ALL LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES, PENALTIES,
JUDGMENTS, SUITS, COSTS, EXPENSES AND DISBURSEMENTS OF ANY KIND WHATSOEVER (THE
“INDEMNIFIED LIABILITIES”) (INCLUDING, WITHOUT LIMITATION, INDEMNIFIED
LIABILITIES RESULTING, IN WHOLE OR IN PART, FROM ANY INDEMNIFIED PARTY’S OWN
NEGLIGENCE OR STRICT LIABILITY) WHICH MAY BE IMPOSED UPON, INCURRED BY OR
ASSERTED AGAINST SUCH INDEMNIFIED PARTY IN ANY WAY RELATING TO OR ARISING OUT OF
THIS AGREEMENT, THE NOTES, OR ANY OTHER LOAN DOCUMENT OR ANY OF THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY TO THE EXTENT THAT ANY SUCH INDEMNIFIED
LIABILITIES RESULT (DIRECTLY OR INDIRECTLY) FROM ANY CLAIMS MADE, OR ANY
ACTIONS, SUITS OR PROCEEDINGS COMMENCED OR THREATENED, BY OR ON BEHALF OF ANY
CREDITOR (EXCLUDING THE LENDERS AND THE HOLDER OR HOLDERS OF THE NOTES),
SECURITY HOLDER, SHAREHOLDER, CUSTOMER (INCLUDING, WITHOUT LIMITATION, ANY
PERSON HAVING ANY DEALINGS OF ANY KIND WITH THE BORROWER), TRUSTEE, DIRECTOR,
OFFICER, EMPLOYEE AND/OR AGENT OF THE BORROWER ACTING IN SUCH CAPACITY, THE
BORROWER OR ANY GOVERNMENTAL REGULATORY BODY OR AUTHORITY.  THE
FOREGOING INDEMNITY SHALL NOT APPLY TO THE EXTENT THE INDEMNIFIED LIABILITIES
RESULT FROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF ANY INDEMNIFIED PARTY
OR ANY INDEMNIFIED PARTY’S OWN VIOLATIONS OF REGULATIONS APPLICABLE TO
IT.  THE AGREEMENT OF THE BORROWER CONTAINED IN THIS
SUBSECTION (c) SHALL SURVIVE THE EXPIRATION OR TERMINATION OF THIS
AGREEMENT AND THE PAYMENT IN FULL OF THE NOTES.  ATTORNEYS’ FEES AND
DISBURSEMENTS INCURRED IN ENFORCING, OR ON APPEAL FROM, A JUDGMENT PURSUANT
HERETO SHALL BE RECOVERABLE SEPARATELY FROM AND IN ADDITION TO ANY OTHER AMOUNT
INCLUDED IN SUCH JUDGMENT, AND THIS CLAUSE IS INTENDED TO BE SEVERABLE FROM THE
OTHER PROVISIONS OF THIS AGREEMENT AND TO SURVIVE AND NOT BE MERGED INTO SUCH
JUDGMENT. WITHOUT LIMITING ANY OF THE FOREGOING, THE BORROWER SHALL UPON DEMAND
PROMPTLY REIMBURSE THE AGENT FOR ALL EXTRAORDINARY SERVICING EXPENSES INCURRED
BY IT.

       

       

       

      
        
          
          

        

        
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      10.3.    INDEMNIFICATION BY THE
LENDERS.  WHETHER OR NOT ANY ADVANCE IS MADE HEREUNDER, THE
LENDERS AGREE TO INDEMNIFY, PAY, DEFEND, AND HOLD HARMLESS THE AGENT IN ITS
RESPECTIVE CAPACITY AS SUCH (TO THE EXTENT NOT REIMBURSED BY THE BORROWER AND
WITHOUT LIMITING THE OBLIGATION OF THE BORROWER TO DO SO), RATABLY ACCORDING TO
THEIR RESPECTIVE COMMITMENT PERCENTAGES, FROM AND AGAINST ANY AND ALL
LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES, PENALTIES, ACTIONS, JUDGMENTS, SUITS,
COSTS, EXPENSES OR DISBURSEMENTS OF ANY KIND WHATSOEVER, INCLUDING WITHOUT
LIMITATION LIABILITIES RESULTING IN WHOLE OR PART FROM THE AGENT’S OWN ORDINARY
NEGLIGENCE OR STRICT LIABILITY, WHICH MAY AT ANY TIME (INCLUDING WITHOUT
LIMITATION AT ANY TIME FOLLOWING THE PAYMENT OF THE OBLIGATIONS) BE IMPOSED ON,
INCURRED BY OR ASSERTED AGAINST THE AGENT IN ANY WAY RELATING TO OR ARISING OUT
OF THE LOAN DOCUMENTS OR ANY DOCUMENTS CONTEMPLATED BY OR REFERRED TO HEREIN OR
THEREIN OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY OR ANY ACTION TAKEN
OR OMITTED BY THE AGENT UNDER OR IN CONNECTION WITH ANY OF THE FOREGOING;
PROVIDED THAT NO LENDER SHALL BE LIABLE FOR THE PAYMENT OF ANY PORTION OF SUCH
LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES, PENALTIES, ACTIONS, JUDGMENTS, SUITS,
COSTS, EXPENSES OR DISBURSEMENTS RESULTING FROM THE AGENT’S GROSS NEGLIGENCE OR
WILLFUL MISCONDUCT.  WITHOUT LIMITATION OF THE FOREGOING, EACH LENDER
SHALL REIMBURSE THE AGENT UPON DEMAND FOR ITS RATABLE SHARE OF ANY COSTS OR
OUT-OF-POCKET EXPENSES (INCLUDING ATTORNEY COSTS) INCURRED BY THE AGENT IN
CONNECTION WITH THE PREPARATION, EXECUTION, DELIVERY, ADMINISTRATION,
MODIFICATION, AMENDMENT OR ENFORCEMENT (WHETHER THROUGH NEGOTIATION, LEGAL
PROCEEDINGS OR OTHERWISE) OF, OR LEGAL ADVICE IN RESPECT OF RIGHTS OR
RESPONSIBILITIES UNDER, THIS AGREEMENT, ANY OTHER LOAN DOCUMENT, OR ANY DOCUMENT
CONTEMPLATED BY OR REFERRED TO HEREIN, AND ALL EXTRAORDINARY SERVICING EXPENSES,
TO THE EXTENT THAT THE AGENT IS NOT REIMBURSED FOR SUCH EXPENSES BY OR ON BEHALF
OF BORROWER.  THE AGREEMENTS IN THIS SECTION SHALL SURVIVE THE PAYMENT
OF THE OBLIGATIONS AND THE TERMINATION OF THIS AGREEMENT.  ATTORNEYS’
FEES AND DISBURSEMENTS INCURRED IN ENFORCING, OR ON APPEAL FROM, A JUDGMENT
PURSUANT HERETO SHALL BE RECOVERABLE SEPARATELY FROM AND IN ADDITION TO ANY
OTHER AMOUNT INCLUDED IN SUCH JUDGMENT, AND THIS CLAUSE IS INTENDED TO BE
SEVERABLE FROM THE OTHER PROVISIONS OF THIS AGREEMENT AND TO SURVIVE AND NOT BE
MERGED INTO SUCH JUDGMENT.

       

       

       

       

      
        
          
          

        

        
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      TO
THE EXTENT THAT, AFTER THE LENDERS HAVE MADE PAYMENTS TO AGENT PURSUANT TO THIS
SECTION 10.2, AGENT RECEIVES FROM THE BORROWER, THE COLLATERAL OR ANY OTHER
SOURCE (OTHER THAN THE LENDERS) ANY AMOUNT ON ACCOUNT OF THE LIABILITIES SO PAID
BY THE LENDERS, AGENT SHALL REIMBURSE SUCH AMOUNT RECEIVED FROM THE BORROWER,
THE COLLATERAL OR SUCH OTHER SOURCE TO THE LENDERS, RATABLY IN ACCORDANCE WITH
THE AMOUNTS RECEIVED FROM THEM PURSUANT TO SECTION 10.2 FOR PURPOSES OF THE
FOREGOING SENTENCE, AGENT MAY APPLY ANY AMOUNT RECEIVED FROM THE BORROWER OR ANY
SUCH OTHER SOURCE TO ANY OBLIGATIONS OWING TO IT UNDER ANY LOAN
DOCUMENT.

       

      11.     THE
AGENT AND THE LENDERS

       

      11.1.   Rights, Duties and
Immunities of the Agent.

       

      (a)    Appointment of
Agent.  Each Lender hereby irrevocably designates and appoints
Bank of America, N.A. as Agent of such Lender to act as specified herein and in
the other Loan Documents, and each such Lender hereby irrevocably authorizes the
Agent to take such actions, exercise such powers and perform such duties as are
expressly delegated to or conferred upon the Agent by the terms of this
Agreement and the other Loan Documents, together with such other powers as are
reasonably incidental thereto.  The Agent agrees to act as such upon
the express conditions contained in this Section 11. The Agent shall not have
any duties or responsibilities except those expressly set forth herein or in the
other Loan Documents, nor shall it have any fiduciary relationship with, or
fiduciary duty to, any Lender, and no implied covenants, responsibilities,
duties, obligations or liabilities shall be read into this Agreement or
otherwise exist against the Agent.  The provisions of this Section 11
are solely for the benefit of the Agent and the Lenders, and the Borrower shall
not have any rights as a third party beneficiary of any of the provisions
hereof.

       

      (b)    Administration of Loan by
Agent.  The Agent shall be responsible for administering the
Loan on a day-to-day basis.  In the exercise of such administrative
duties, the Agent shall use the same diligence and standard of care that is
customarily used by the Agent with respect to similar loans held by the Agent
solely for its own account. Each Lender delegates to the Agent the full right
and authority on its behalf to take the following specific actions in connection
with its administration of the Loan:

       

      (i)     to
fund each Advance in accordance with the provisions of the Loan Documents, but
only to the extent of immediately available funds provided to the Agent by the
respective Lenders for such purpose;

       

      (ii)    to
receive all payments of principal, interest, fees and other charges paid by, or
on behalf of, the Borrower and, except for fees to which the Agent is entitled
pursuant to the Loan Documents or otherwise, to distribute all such funds to the
respective Lenders as provided for hereunder;

       

       

       

       

      
        
          
          

        

        
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      (iii)    to
keep and maintain complete and accurate files and records of all material
matters pertaining to the Loan, and make such files and records available for
inspection and copying by each Lender and its respective employees and agents
during normal business hours upon reasonable prior notice to the Agent;
and

       

      (iv)  
 to do or omit doing all such other actions as may be reasonably necessary
or incident to the implementation, administration and servicing of the Loan and
the rights and duties delegated hereinabove.

       

      (c)    Delegation of
Duties.  The Agent may execute any of its duties under this
Agreement or any other Document by or through its agents or attorneys-in-fact,
and shall be entitled to the advice of counsel concerning all matters pertaining
to its rights and duties hereunder or under the Loan Documents.  The
Agent shall not be responsible for the negligence or misconduct of any agents or
attorneys-in-fact selected by it with reasonable care.

       

      (d)    Exculpatory
Provisions.  Neither the Agent nor any of its officers,
directors, employees, agents, attorneys-in-fact or affiliates shall be liable
for any action lawfully taken or omitted to be taken by it or them under or in
connection with this Agreement or the other Loan Documents, except for its or
their gross negligence or willful misconduct.  Neither the Agent nor
any of its officers, directors, employees, agents, attorneys-in-fact or
affiliates shall be responsible for or have any duty to ascertain, inquire into,
or verify (i) any recital, statement, representation or warranty made by the
Borrower or any of their respective officers or agents contained in this
Agreement or the other Loan Documents or in any certificate or other document
delivered in connection therewith; (ii) the performance or observance by the
Borrower of any of the covenants or agreements contained in, or the conditions
of, this Agreement or the other Loan Documents; (iii) the state or condition of
any properties of the Borrower or any other obligor hereunder constituting
Collateral for the Obligations, except as may be specifically provided in this
Agreement or the Exhibits hereto (subject to the immediately preceding
sentence), or any information contained in the books or records of the Borrower;
(iv) the validity, enforceability, collectibility, effectiveness or genuineness
of this Agreement or any other Loan Document or any other certificate, document
or instrument furnished in connection therewith; or (v) the validity, priority
or perfection of any lien securing or purporting to secure the Obligations or
the value or sufficiency of any of the Collateral.

       

      (e)    Reliance by
Agent.  The Agent shall be entitled to rely, and shall be fully
protected in relying, upon any notice, consent, certificate, affidavit, or other
document or writing believed by it to be genuine and correct and to have been
signed, sent or made by the proper person or persons, and upon the advice and
statements of legal counsel (including, without, limitation, counsel to the
Borrower), independent accountants and other experts selected by the
Agent.  The Agent shall be fully justified in failing or refusing to
take any action under this Agreement or any other Loan Document unless it shall
first receive such advice or concurrence of the Majority Lenders (or all the
Lenders, if and to the extent required pursuant to Section 11.4.1 hereof) as it
deems appropriate or it shall first be indemnified to its satisfaction by the
Lenders against any and all liability and expense which may be incurred by it by
reason of the taking or failing to take any such action.  The Agent
shall in all cases be fully protected in acting, or in refraining from acting,
under this Agreement and the other Loan Documents in accordance with any written
request of the Majority Lenders, and each such request of the Majority Lenders,
and any action taken or failure to act by the Agent pursuant thereto, shall be
binding upon all of the Lenders; provided, however, that the Agent shall not be
required in any event to act, or to refrain from acting, in any manner which is
contrary to the Loan Documents or to applicable law.

       

       

       

       

      
        
          
          

        

        
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      (f)    Notice of
Default.  The Agent shall not be deemed to have knowledge or
notice of the occurrence of any Default unless the Agent has actual knowledge of
the same or has received notice from a Lender or the Borrower referring to this
Agreement, describing such Default and stating that such notice is a “notice of
default”.  In the event that the Agent obtains such actual knowledge
or receives such a notice, the Agent shall give prompt notice thereof to each of
the Lenders.  The Agent shall take such action with respect to such
Default as shall be reasonably directed by the Majority Lenders (or all the
Lenders, if and to the extent required pursuant to Section 11.4
hereof).  Unless and until the Agent shall have received such
direction, the Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to any such Default as it shall
deem advisable in the best interest of the Lenders, provided, however, that the
Agent shall not accelerate the indebtedness under this Agreement without the
prior written consent of the Majority Lenders.

       

      (g)    Lenders’ Credit
Decisions.  Each Lender acknowledges that it has, independently
and without reliance upon the Agent or any other Lender, and based on the
financial statements prepared by the Borrower and such other documents and
information as it has deemed appropriate, made its own credit analysis and
investigation into the business, assets, operations, property, and financial and
other condition of the Borrower and has made its own decision to enter into this
Agreement and the other Loan Documents.  Each Lender also acknowledges
that it will, independently and without reliance upon the Agent or any other
Lender, and based on such documents and information as it shall deem appropriate
at the time, continue to make its own credit decisions in determining whether or
not conditions precedent to closing any Loan hereunder have been satisfied and
in taking or not taking any action under this Agreement and the other Loan
Documents.

       

      (h)    Agent’s Reimbursement and
Indemnification.  The Lenders agree to reimburse and indemnify
the Agent, ratably in proportion to their respective Commitment Amounts, for (i)
any amounts not reimbursed by the Borrower for which the Agent is entitled to
reimbursement by the Borrower under this Agreement or the other Loan Documents,
(ii) any other expenses incurred by the Agent on behalf of the Lenders in
connection with the preparation, execution, delivery, administration, amendment,
waiver and/or enforcement of this Agreement and the other Loan Documents, and
(iii) any liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind and nature
whatsoever which may imposed on, incurred by or asserted against the Agent in
any way relating to or arising out of this Agreement or the other Loan Documents
or any other document delivered in connection therewith or any transaction
contemplated thereby, or the enforcement of any of the terms hereof or thereof,
provided that no Lender shall be liable for any of the foregoing to the extent
that they arise from the gross negligence or willful misconduct of the
Agent.  If any indemnity furnished to the Agent for any purpose shall,
in the opinion of the Agent, be insufficient or become impaired, the Agent may
call for additional indemnity and cease, or not commence, to do the action
indemnified against until such additional indemnity is furnished.

       

       

       

       

      
        
          
          

        

        
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      (i)    Agent in its Individual
Capacity.  With respect to its Commitment Amount as a Lender,
and the Loans made by it and the Note issued to it, the Agent shall have the
same rights and powers hereunder and under any other Loan Document as any Lender
and may exercise the same as though it were not the Agent, and the term “Lender”
or “Lenders” shall, unless the context otherwise indicates, include the Agent in
its individual capacity.  The Agent and its subsidiaries and
affiliates may accept deposits from, lend money to, and generally engage in any
kind of commercial or investment banking, trust, advisory or other business with
the Borrower or any Subsidiary or Affiliate of the Borrower as if it were not
the Agent hereunder.

       

      (j)    Successor
Agent.  The Agent may resign at any time by giving thirty (30)
days’ prior written notice to the Lenders and the Borrower.  The
Majority Lenders, for good cause, may remove Agent at any time by giving thirty
(30) days’ prior written notice to the Agent, the Borrower and the other
Lenders.  Upon any such resignation or removal, the Majority Lenders
shall have the right to appoint a successor Agent.  If no successor
Agent shall have been so appointed by the Majority Lenders and accepted such
appointment within thirty (30) days after the retiring Agent’s giving notice of
resignation or the Majority Lenders’ giving notice of removal, as the case may
be, then the retiring or removed Agent may appoint, on behalf of the Borrower
and the Lenders, a successor Agent.  Each such successor Agent shall
be a financial institution having (i) senior unsecured debt obligations rated at
least BBB by Standard & Poor’s (or a comparable rating from another Rating
Agency), and (ii) total assets in excess of $10,000,000,000.00.  Upon
the acceptance of any appointment as Agent hereunder by a successor Agent, such
successor Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring or removed Agent, and the
retiring or removed Agent shall be discharged from its duties and obligations
hereunder and under the other Loan Documents.  After any retiring
Agent’s resignation hereunder, or the removal of the Agent hereunder, the
provisions of this Section 11 shall continue in effect for its benefit in
respect of any actions taken or omitted to be taken by it while it was acting as
the Agent hereunder.

       

      (k)    Duties in the Case of
Enforcement.  In case one or more Events of Default have
occurred and shall be continuing, and whether or not acceleration of the
Obligations shall have occurred, the Agent shall, at the request, or may, upon
the consent, of the Majority Lenders, and provided that the Lenders have given
to the Agent such additional indemnities and assurances against expenses and
liabilities as the Agent may reasonably request, proceed to enforce the
provisions of this Agreement and the other Loan Documents respecting the
foreclosure of mortgages, the sale or other disposition of all or any part of
the Collateral and the exercise of any other legal or equitable rights or
remedies as it may have hereunder or under any other Loan Document or otherwise
by virtue of applicable law, or to refrain from so acting if similarly requested
by the Majority Lenders.  The Agent shall be fully protected in so
acting or refraining from acting upon the instruction of the Majority Lenders,
and such instruction shall be binding upon all the Lenders.  The
Majority Lenders may direct the Agent in writing as to the method and the extent
of any such foreclosure, sale or other disposition or the exercise of any other
right or remedy, the Lenders hereby agreeing to indemnify and hold the Agent
harmless from all costs and liabilities incurred in respect of all actions taken
or omitted in accordance with such direction, provided that the Agent need not
comply with any such direction to the extent that the Agent reasonably believes
the Agent’s compliance with such direction to be unlawful or commercially
unreasonable in any applicable jurisdiction.  The Agent may, in its
discretion but without obligation, in the absence of direction from the Majority
Lenders, take such interim actions as it believes necessary to preserve the
rights of the Lenders hereunder and in and to any Collateral securing the
Obligations, including but not limited to petitioning a court for injunctive
relief, appointment of a receiver or preservation of the proceeds of any
Collateral.  Each of the Lenders acknowledges and agrees that no
individual Lender may separately enforce or exercise any of the provisions of
any of the Loan Documents, including without limitation the Notes, other than
through the Agent.

       

       

       

       

      
        
          
          

        

        
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      (l)   Distributions of Notices and
Documents.  The Agent will forward to each Lender, promptly
after the Agent’s receipt thereof, a copy of each notice or other document
furnished to the Agent pursuant to this Agreement other than routine
communications associated with requests for Advances or determinations of
Collateral eligibility, other routine or nonmaterial communications, notices or
documents required by any of Loan Documents to be furnished directly to the
Lenders by the Borrower, or of which the Agent has knowledge that such notice or
document otherwise had been forwarded directly to the Lenders other than by the
Agent.  Except for notices, reports and other documents expressly
required to be furnished to the Lenders by the Agent hereunder, the Agent shall
not have any duty or responsibility to provide any Lender with any credit or
other information concerning the business, operations, property, condition
(financial or otherwise), prospects or creditworthiness of Borrower which may
come into the possession of the Agent or any of its officers, directors,
employees, agents, attorneys-in-fact or Affiliates.

       

      11.2.    Respecting Loans and
Payments.

       

      (a)    Procedures for
Advances.  Agent shall give written notice to each Lender of
each request for a Advance by facsimile transmission, hand delivery or overnight
courier on the same Business Day as received from the Borrower pursuant to
Section 2.2.  Each such notice shall be accompanied by a written
summary of the request for a Advance and shall specify (i) the date of the
requested Advance, (ii) the aggregate amount of the requested Advance, and (iii)
each Lender’s pro rata share of the requested Advance.  Each Lender
shall, before 11:00 a.m. (Boston time) on the date set forth in any such request
for a Advance, make available to Agent, at an account to be designated by Agent
at Bank of America, N.A. in Boston, Massachusetts, in same day funds, each
Lender’s ratable portion of the requested Advance.  After Agent’s
receipt of such funds and upon Agent’s determination that the applicable
conditions to making the requested Advance have been fulfilled, Agent shall make
such funds available to the Borrower as provided for in this
Agreement.  Within a reasonable period of time following the making of
each Advance, Agent shall deliver to each Lender a copy of the Borrower’s
request for such Advance.  Promptly after receipt by Agent of written
request from any Lender, Agent shall deliver to the requesting Lender the
accompanying certifications and such other instruments, documents,
certifications and approvals delivered by or on behalf of the Borrower to Agent
in support of the requested Advance.

       

      (b)    Nature of Obligations of
Lenders.  The obligations of the Lenders hereunder are several
and not joint.  Failure of any Lender to fulfill its obligations
hereunder shall not result in any other Lender becoming obligated to advance
more than its Commitment Percentage of the Loan, nor shall such failure release
or diminish the obligations of any other Lender to fund its Commitment
Percentage provided herein.

       

       

       

       

      
        
          
          

        

        
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      (c)    Payments to
Agent.  All payments of principal of and interest on the Loan
or the Notes shall be made to the Agent by the Borrower or any other obligor or
guarantor for the account of the Lenders in immediately available funds as
provided in the Notes and this Agreement and any other Loan Document. Except as
otherwise expressly provided herein, the Agent agrees to use its reasonable best
efforts to promptly to distribute to each Lender on the same Business Day upon
which each such payment is made, such Lender’s proportionate share of each such
payment in immediately available funds excluding liquidation proceeds which
shall be distributed in accordance with Section 11.2(d).  The Agent
shall upon each distribution promptly notify the Borrower of such distribution
and each Lender of the amounts distributed to it applicable to principal of, and
interest on, the proportionate share held by the applicable
Lender.  Each payment to the Agent under the first sentence of this
Section 11.2(c) shall constitute a payment by the Borrower to each Lender in the
amount of such Lender’s proportionate share of such payment, and any such
payment to the Agent shall not be considered outstanding for any purpose after
the date of such payment by the Borrower to the Agent without regard to whether
or when the Agent makes distribution thereof as provided above.  If
any payment received by the Agent from the Borrower is insufficient to pay both
all accrued interest and all principal then due and owing, unless otherwise
provided herein, the Agent shall first apply such payment to all outstanding
interest until paid in full and shall then apply the remainder of such payment
to all principal then due and owing, and shall distribute the payment to each
Lender accordingly.

       

      (d)    Liquidation
Proceeds.  The proceeds of any sale, disposition or other
enforcement of the security interest in all or any part of the Collateral shall
be applied by the Agent as provided in Section 8.3.

       

      (e)    Adjustments.  If,
after Agent has paid each Lender’s proportionate share of any payment received
or applied by Agent in respect of the Loan, that payment is rescinded or must
otherwise be returned or paid over by Agent, whether pursuant to any bankruptcy
or insolvency law, sharing of payments clause of any loan agreement or
otherwise, such Lender shall, at Agent’s request, promptly return its
proportionate share of such payment or application to Agent, together with the
Lender’s proportionate share of any interest or other amount required to be paid
by Agent with respect to such payment or application.

       

      (f)    Setoff.  If
any Lender (including the Agent), acting in its individual capacity, shall
exercise any right of setoff against a deposit balance or other account of the
Borrower held by such Lender on account of the obligations of the Borrower under
this Agreement, such Lender shall remit to the Agent all such sums received
pursuant to the exercise of such right of setoff, and the Agent shall apply all
such sums for the benefit of all of the Lenders hereunder in accordance with the
terms of this Agreement.

       

      (g)    Distribution by
Agent.  If in the opinion of the Agent distribution of any
amount received by it in such capacity hereunder or under the Notes or under any
of the other Loan Documents might involve any liability, it may refrain from
making distribution until its right to make distribution shall have been
adjudicated by a court of competent jurisdiction or has been resolved by the
mutual consent of all Lenders.  In addition, the Agent may request
full and complete indemnity, in form and substance satisfactory to it, prior to
making any such distribution.  If a court of competent jurisdiction
shall adjudge that any amount received and distributed by the Agent is to be
repaid, each person to whom any such distribution shall have been made shall
either repay to the Agent its proportionate share of the amount so adjudged to
be repaid or shall pay over to the same in such manner and to such persons as
shall be determined by such court.

       

       

       

       

      
        
          
          

        

        
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      (h)       Delinquent
Lender.

       

      (i)           If
for any reason any Lender shall fail or refuse to abide by its obligations under
this Agreement, including without limitation its obligation to make available to
Agent its pro rata share of any Loans, expenses or setoff (a “Delinquent
Lender”) and such failure is not cured within ten (10) days of receipt from the
Agent of written notice thereof, then, in addition to the rights and remedies
that may be available to Agent, other Lenders, the Borrower or any other party
at law or in equity, and not in limitation thereof, (y) such Delinquent Lender’s
right to participate in the administration of, or decision-making rights related
to, the Loans, this Agreement or the other Loan Documents shall be suspended
during the pendency of such failure or refusal, and (z) a Delinquent Lender
shall be deemed to have assigned any and all payments due to it from the
Borrower, whether on account of outstanding Loans, interest, fees or otherwise,
to the remaining non-delinquent Lenders for application to, and reduction of,
their proportionate shares of all outstanding Loans until, as a result of
application of such assigned payments the Lenders’ respective pro rata shares of
all outstanding Loans shall have returned to those in effect immediately prior
to such delinquency and without giving effect to the nonpayment causing such
delinquency.  The Delinquent Lender’s decision-making and
participation rights and rights to payments as set forth in clauses (y) and (z)
hereinabove shall be restored only upon the payment by the Delinquent Lender of
its pro rata share of any Loans, expenses or setoffs as to which it is
delinquent, together with interest thereon at the Default Rate from the date
when originally due until the date upon which any such amounts are actually
paid.

       

      (ii)           The
non-delinquent Lenders shall also have the right, but not the obligation, in
their respective, sole and absolute discretion, to acquire for no cash
consideration, (pro rata, based on the respective Commitments of those
Lenders electing to exercise such right) the Delinquent Lender’s Commitment to
fund future Loans (the “Future Commitment”).  Upon any such purchase
of the pro
rata share of
any Delinquent Lender’s Future Commitment, the Delinquent Lender’s share in
future Loans and its rights under the Loan Documents with respect thereto shall
terminate on the date of purchase, and the Delinquent Lender shall promptly
execute all documents reasonably requested to surrender and transfer such
interest, including, if so requested, an Assignment and
Acceptance.  Each Delinquent Lender shall indemnify Agent and each
non-delinquent Lender from and against any and all loss, damage or expenses,
including but not limited to reasonable attorneys’ fees and funds advanced by
Agent or by any non-delinquent Lender, on account of a Delinquent Lender’s
failure to timely fund its pro rata share of a Loan
or to otherwise perform its obligations under the Loan Documents.

       

      (i)    Holders.  The
Agent may deem and treat the payee of any Note as the owner thereof for all
purposes hereof unless and until a written notice of the assignment, transfer or
endorsement thereof, as the case may be, shall have been filed with the
Agent.  Any request, authority or consent of any person or entity who,
at the time of making such request or giving such authority or consent, is the
holder of any Note shall be conclusive and binding on any subsequent holder,
transferee or endorsee, as the case may be, of such Note or of any Note or Notes
issued in exchange therefor.

       

       

       

      
        
          
          

        

        
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      11.3.    Assignment and
Participation.

       

      (a)    Conditions to Assignment by
Lenders.  Except as provided herein, each Lender may assign to
one or more Eligible Assignees all or a portion of its interests, rights and
obligations under this Agreement (including all or a portion of its Commitment
Percentage and Commitment and the same portion of the Loans at the time owing to
it and the Notes held by it), upon satisfaction of the following conditions: (i)
each of the Agent and the Borrower shall have given its prior written consent to
such assignment (provided that, in the case of the Borrower, such consent will
not be unreasonably withheld and shall not be required if a Default shall have
occurred and be continuing); (ii) each such assignment shall be of a constant,
and not a varying, percentage of all the assigning Lender’s rights and
obligations under this Agreement, (iii) each assignment shall be in an amount
that is at least $10,000,000.00 and is a whole multiple of $250,000.00, (iv)
each Lender which is a Lender at the time of such assignment shall retain, free
of any such assignment, an amount of its Commitment of not less than
$5,000,000.00, (v) the Agent, in its individual capacity as a Lender, shall
retain, free of any such assignment, an amount of its Commitment of not less
than $20,000,000.00, and (vi) the parties to such assignment shall execute and
deliver to the Agent, for recording in the Register (as hereinafter defined), an
Assignment and Acceptance, substantially in the form of Exhibit
F hereto (an “Assignment and Acceptance”), together with any Notes
subject to such assignment.  Upon such execution, delivery, acceptance
and recording, from and after the effective date specified in each Assignment
and Acceptance, which effective date shall be at least five (5) Business Days
after the execution thereof, (y) the assignee thereunder shall be a party hereto
and, to the extent provided in such Assignment and Acceptance, have the rights
and obligations of a Lender hereunder, and (z) the assigning Lender shall, to
the extent provided in such assignment and upon payment to the Agent of the
registration fee referred to in Section 11.3(b), be released from its
obligations under this Agreement.

       

      (b)    Register.  The
Agent shall maintain a copy of each Assignment and Acceptance delivered to it
and a register or similar list (the “Register”) for the recordation of the names
and addresses of the Lenders and the Commitment Percentage of, and principal
amount of the Loans owing to the Lenders from time to time.  The
entries in the Register shall be conclusive, in the absence of manifest error,
and the Borrower, the Agent and the Lenders may treat each person whose name is
recorded in the Register as a Lender hereunder for all purposes of this
Agreement.  The Register shall be available for inspection by the
Borrower and the Lenders at any reasonable time and from time to time upon
reasonable prior notice.  Upon each such recordation, the assigning
Lender agrees to pay to the Agent a registration fee in the sum of
($5,000.00).

       

      (c)    New
Notes.  Upon its receipt of an Assignment and Acceptance
executed by the parties to such assignment, together with each Note subject to
such assignment, the Agent shall (i) record the information contained therein in
the Register, and (ii) give prompt notice thereof to the Borrower and the
Lenders (other than the assigning Lender).  Within five (5) Business
Days after receipt of such notice, the Borrower, at its own expense, shall
execute and deliver to the Agent, in exchange for each surrendered Note, a new
Note to the order of such Eligible Assignee in an amount equal to the amount
assumed by such Eligible Assignee pursuant to such Assignment and Acceptance
and, if the assigning Lender has retained some portion of its obligations
hereunder, a new Note to the order of the assigning Lender in an amount equal to
the amount retained by it hereunder.  Such new Notes shall provide
that they are replacements for the surrendered Notes, shall be in an aggregate
principal amount equal to the aggregate principal amount of the surrendered
Notes, shall be dated the effective date of such Assignment and Acceptance and
shall otherwise be substantially the form of the assigned
Notes.  Within five (5) days of issuance of any new Notes pursuant to
this Section 11.3(c), the Borrower shall deliver an opinion of counsel,
addressed to the Lenders and the Agent, relating to the due authorization,
execution and delivery of such new Notes and the legality, validity and binding
effect thereof, in form and substance satisfactory to the
Lenders.  The surrendered Notes shall be cancelled and returned to the
Borrower.

       

       

       

       

      
        
          
          

        

        
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      (d)    Participations.  Each
Lender may sell participations to one or more banks or other financial
institutions in all or a portion of such Lender’s rights and obligations under
this Agreement and the other Loan Documents; provided that (i) the Borrower
shall have given its prior written consent to such participation (provided that
such consent will not be unreasonably withheld and shall not be required if a
Default shall have occurred and be continuing), (ii) each such participation
shall be in a minimum amount of $5,000,000.00, (iii) each participant shall meet
the requirements of an Eligible Assignee, (iv) any such sale or participation
shall not affect the rights and duties of the selling Lender hereunder to the
Borrower, and (v) the only rights granted to the participant pursuant to such
participation arrangements with respect to waivers, amendments or modifications
of the Loan Documents shall be the rights to approve waivers, amendments or
modifications that would reduce the principal of or the interest rate on any
Loans, extend the term or increase the amount of the Commitment of such Lender
as it relates to such participant, reduce the amount of any commitment fees to
which such participant is entitled or extend any regularly scheduled payment
date for principal or interest.

       

      (e)    Disclosure.  The
Borrower agrees that in addition to disclosures made in accordance with standard
and customary banking practices any Lender may disclose information obtained by
such Lender pursuant to this Agreement to assignees or participants and
potential assignees or participants hereunder; provided that such assignees or
participants or potential assignees or participants shall agree (i) to treat in
confidence such information unless such information otherwise becomes public
knowledge, (ii) not to disclose such information to a third party, except as
required by law or legal process and (iii) not to make use of such information
for purposes of transactions unrelated to such contemplated assignment or
participation.

       

      (f)    Miscellaneous Assignment
Provisions.  Any assigning Lender shall retain its rights to be
indemnified pursuant to Section 10.1 with respect to any claims or actions
arising prior to the date of such assignment.  If any assignee Lender
is not incorporated under the laws of the United States of America or any state
thereof, it shall, prior to the date on which any interest or fees are payable
hereunder or under any of the other Loan Documents for its account, deliver to
the Borrower and the Agent certification as to  exemption from
deduction or withholding of any United States federal income
taxes.  Anything contained in this Section 11.3.7 to the contrary
notwithstanding (i) any Lender may at any time pledge all or any portion of its
interest and rights under this Agreement (including all or any portion of its
Notes) to any of the twelve Federal Reserve Banks organized under Section 4 of
the Federal Reserve Act, 12 U.S.C. Section 341, and (ii) any Lender may assign,
pledge or participate its interests, rights and obligations under this
Agreement, including its right to receive and retain payments on its Note, in
connection with any arrangement maintained by such Lender to fund credit
facilities provided to that Lender; provided, however, that such
Lender shall remain primarily and directly liable to timely and fully perform
all of its obligations under this Agreement, and no such pledge or the
enforcement thereof shall release the pledgor Lender from its obligations
hereunder or under any of the other Loan Documents or require the Borrower to
have direct duties or responsibilities to more than one such assignee, pledgee,
or participant of such pledgor Lender under this sentence.

       

       

       

       

      
        
          
          

        

        
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      (g)    Assignment by
Borrower.  The Borrower shall not assign or transfer any of its
rights or obligations under any of the Loan Documents without the prior written
consent of each of the Lenders.

       

      11.4.    Administrative Matters.

       

      (a)    Amendment, Waiver, Consent,
Etc.  Except as otherwise provided herein or as to any term or
provision hereof which provides for the consent or approval of the Agent, no
term or provision of this Agreement or any other Loan Document may be changed,
waived, discharged or terminated, nor may any consent required or permitted by
this Agreement or any other Loan Document be given, unless such change, waiver,
discharge, termination or consent receives the written approval of the Majority
Lenders.

       

      Notwithstanding
the foregoing, the unanimous written approval of all the Lenders (other than a
Defaulting Lender) shall be required with respect to any proposed amendment,
waiver, discharge, termination, or consent which:

       

      (i)           has
the effect of (w) extending the final scheduled maturity or the date of any
amortization payment of any Loan or Note, (x) reducing the rate or extending the
time of payment of interest or fees thereon, (y) increasing or reducing the
principal amount thereof, or (z) otherwise postponing or forgiving any
indebtedness thereunder;

       

      (ii)           releases
or discharges any material portion of the Collateral other than in accordance
with the express provisions of the Loan Documents;

       

      (iii)           amends,
modifies or waives any provisions of this Section 11.4(a);

       

      (iv)           amends,
modifies or waives any provisions of the limitations set forth on Exhibit B or the
definition of any term used therein or used in any of the financial covenants
set forth in Section 7.3 through 7.6, 7.21 or 7.22;

       

      (v)           reduces
the percentage specified in the definition of Majority Lenders;

       

      (vi)           except
as otherwise provided in the Agreement or arising by the assignment by a Lender
of a portion of its Commitment, changes the amount of any Lender’s Commitment or
Commitment Percentage, or

       

       

       

       

      
        
          
          

        

        
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      (vii)           releases
or waives any guaranty of the Obligations or indemnifications provided in the
Loan Documents;

       

      and provided, further,
that without the consent of the Agent, no such action shall amend, modify or
waive any provision of this Section 11 or any other provision of any Loan
Document which relates to the rights or obligations of the Agent.

       

      (b)    Deemed Consent or
Approval.  With respect to any requested amendment, waiver,
consent or other action which requires the approval of the Majority Lenders or
all of the Lenders, as the case may be, in accordance with the terms of this
Agreement, or if the Agent is required hereunder to seek, or desires to seek,
the approval of the Majority Lenders or all of the Lenders, as the case may be,
prior to undertaking a particular action or course of conduct, the Agent in each
such case shall provide each Lender with written notice of any such request for
amendment, waiver or consent or any other requested or proposed action or course
of conduct, accompanied by such detailed background information and explanations
as may be reasonably necessary to determine whether to approve or disapprove
such amendment, waiver, consent or other action or course of
conduct.  The Agent may (but shall not be required to) include in any
such notice, printed in capital letters or boldface type, a legend substantially
to the following effect:

       

      “THIS
COMMUNICATION REQUIRES IMMEDIATE RESPONSE.  FAILURE TO RESPOND WITHIN
TEN (10) CALENDAR DAYS FROM THE RECEIPT OF THIS COMMUNICATION SHALL CONSTITUTE A
DEEMED APPROVAL BY THE ADDRESSEE OF THE ACTION REQUESTED BY THE BORROWER OR THE
COURSE OF CONDUCT PROPOSED BY THE AGENT AND RECITED ABOVE,”

       

      and if
the foregoing legend is included by the Agent in its communication, a Lender
shall be deemed to have approved or consented to such action or course of
conduct for all purposes hereunder if such Lender fails to object to such action
or course of conduct by written notice to Agent within ten (10) calendar days of
such Lender’s receipt of such notice; provided, however, that, upon
the written request of any Lender for additional time to consider such proposed
action or course of conduct in accordance with the requirements of such Lender’s
internal review process, the foregoing 10-day period shall be extended by the
Agent for up to an additional ten (10) calendar days.

       

      11.5.    Commitment
Increases.

       

      (a)    At any
time and from time to time after the date hereof, the Commitment may be
increased either by an Additional Lender establishing a Commitment Amount or by
one or more then existing Lenders, at each such Lender’s sole discretion
(“Increase Lender”) increasing its Commitment Amount (each such increase by
either means, a “Commitment Increase”) provided that no Commitment Increase
shall become effective unless and until the Agent has approved (in its
unrestricted discretion) such Commitment Increase, and the Borrower, the Agent
and the Additional Lender or the Increase Lender shall have executed and
delivered an amendment with respect to such Commitment
Increase.  Prior to the effective date of any Commitment Increase, the
Borrower shall issue a Note to the Additional Lender or, against surrender of
its existing Note, to an Increase Lender in the amount of such Lender’s
Commitment Amount after giving effect to such Commitment
Increase.  Such new promissory notes shall constitute a “Note” for the
purpose of the Loan Documents.  For the avoidance of doubt, and
notwithstanding the Agent’s ability to approve or refuse Commitment Increases,
no Lender’s Commitment Amount shall be increased as a result of a Commitment
Increase without such Lender’s consent.

       

       

       

       

      
        
          
          

        

        
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      (b)    On the
effective date of any Commitment Increase, the Agent shall recompute the
Commitment Percentage for each Lender following the Commitment Increase, and
within in two (2) Business Days, the Agent shall request Advances of the
affected category from or shall direct prepayments of such Advances to, each
Lender so that the total amount of all then outstanding Advances of the affected
category of each category are shared pro rata with each Lender, pursuant to
Section 2.1 hereof.

       

      11.6.    Temporary
Increases.

       

      (a)    The
Borrower may from time to time, provided no Default has occurred and is
continuing, request a temporary increase in the Commitment for one or more
periods of time (each, a “Temporary Increase”) by delivering to the Agent a
request for a Temporary Increase in substantially the form attached hereto as
Exhibit H-1,
with such changes to such form as the Agent, in its sole discretion, shall deem
necessary.  If the Temporary Increase is approved by the Agent in its
unrestricted discretion, the Borrower shall complete, execute and deliver to the
Lenders a temporary increase agreement and promissory notes evidencing the
temporary increase in the Commitment in substantially the forms attached hereto
as Exhibit H-2
and Exhibit A
to Exhibit H-2,
respectively (with such changes to such form as the Agent, in its sole
discretion, shall deem necessary), accompanied by such documents and agreements
as are referenced in or required under each such temporary increase
agreement.  For the avoidance of doubt, and notwithstanding the
Agent’s ability to approve or refuse Temporary Increases, no Lender’s Commitment
Amount shall be increased as a result of a Temporary Increase without such
Lender’s consent.

       

      (b)    The
Lenders whose Commitment Amounts will temporarily increase as a result of a
Temporary Increase shall set such conditions as such Lenders may determine must
be fulfilled prior to granting, and such terms as shall be applicable to, any
such Temporary Increase; provided, however, that the Agent shall promptly notify
the Borrower in writing of any additional conditions and terms, and the Borrower
may withdraw such request if the conditions and terms are not acceptable to the
Borrower.

       

      (c)    In
addition to any conditions set by the Lenders under Section 11.6(b), each such
temporary increase agreement shall be subject to all of the terms and conditions
of this Agreement.

       

      (d)    The
Lenders’ agreement to any Temporary Increase shall not bind the Lenders to grant
or extend any other or further Temporary Increase.

       

       

       

       

      
        
          
          

        

        
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      12.       MISCELLANEOUS.

       

      12.1.    Confidentiality.  Each
of Agent and the Lenders agrees to maintain the confidentiality of the
Information (as defined below), except that Information may be disclosed
(a) to its and its Affiliates’ directors, officers, employees and agents,
including accountants, legal counsel and other advisors, in connection with
matters relating to the credit relationship with the Borrower and/or the
administration of the Loan Documents (it being understood that the Persons to
whom such disclosure is made will be informed of the confidential nature of such
Information and instructed to keep such Information confidential), (b) to the
extent requested by any regulatory authority (including any self-regulatory
authority, such as the National Association of Insurance Commissioners), (c) to
the extent required by applicable laws or regulations or by any subpoena or
similar legal process, (d) to any other party to this Agreement, (e) in
connection with the exercise of any remedies hereunder or under any other Loan
Document or any action or proceeding relating to this Agreement or any other
Loan Document or the enforcement of rights hereunder or thereunder, (f) subject
to an agreement containing provisions substantially the same as those of this
Section, to (i) any eligible assignee of or participant in, or any prospective
eligible assignee of or participant in, any of its rights or obligations under
this Agreement or (ii) any actual or prospective counterparty (or its advisors)
to any swap or derivative transaction relating to Borrower and its obligations,
(g) with the consent of Borrower or (h) to the extent such Information (x)
becomes publicly available other than as a result of a breach of this
Section 12.1 or (y) becomes available to Agent or any Lender on a
nonconfidential basis from a source other than Borrower.  For purposes
of this Section 12.1, “Information” means all information received from any
Borrower relating to any Borrower or any of their respective businesses, other
than any such information that is available to Agent or any Lender on a
nonconfidential basis prior to disclosure by any Borrower.  Any Person
required to maintain the confidentiality of Information as provided in this
Section shall be considered to have complied with its obligation to do so if
such Person has exercised the same degree of care to maintain the
confidentiality of such Information as such Person would accord to its own
confidential information.  Notwithstanding anything in this Agreement
to the contrary, “Information” shall not include, and Agent and each Lender may
disclose without limitation of any kind, any information with respect to the
“tax
treatment” and “tax
structure” (in each case, within the meaning of Treasury Regulation
Section 1.6011-4) of the transactions contemplated hereby and all materials of
any kind (including opinions or other tax analyses) that are provided to Agent
or such Lender relating to such tax treatment and tax structure; provided that, with respect
to any document or similar item that in either case contains information
concerning the tax treatment or tax structure of the transaction as well as
other information, this sentence shall only apply to such portions of the
document or similar item that relate to the tax treatment or tax structure of
the Loan and transactions contemplated hereby. In addition, Agent may disclose
to any agency or organization that assigns standard identification numbers to
loan facilities such basic information describing the facilities provided
hereunder as is necessary to assign unique identifiers (and, if requested,
supply a copy of this Agreement), it being understood that the Person to whom
such disclosure is made will be informed of the confidential nature of such
Information and instructed to make available to the public only such Information
as such person normally makes available in the course of its business of
assigning identification numbers.

       

       

       

       

      
        
          
          

        

        
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      12.2.    Governing
Law.  This Agreement and the other Loan Documents shall be
governed by the laws of the State of New York, without reference to its
principles of conflicts of laws.

       

      12.3.    Relationship of the
Parties.  This Agreement provides for the making of Advances by
the Lenders, in their capacity as lenders, to the Borrower, in its capacity as a
borrower, and for the payment of interest, repayment of principal by the
Borrower to the Lenders, and for the payment of certain fees by the Borrower to
the Lenders and the Agent.  The relationship between the Lenders and
the Borrower is limited to that of creditor/secured party, on the one hand, and
debtor, on the other hand.  The provisions herein for compliance with
financial covenants and delivery of financial statements are intended solely for
the benefit of the Lenders to protect their interests as lenders in assuring
payments of interest and repayment of principal and payment of certain fees, and
nothing contained in this Agreement shall be construed as permitting or
obligating the Agent or the Lenders to act as a financial or business advisor or
consultant to the Borrower, as permitting or obligating the Agent or the Lenders
to control the Borrower or to conduct the Borrower’s operations, as creating any
fiduciary obligation on the part of the Agent or the Lenders to the Borrower, or
as creating any joint venture, agency, or other relationship between the parties
hereto other than as explicitly and specifically stated in this
Agreement.  The Borrower acknowledges that it has had the opportunity
to obtain the advice of experienced counsel of its own choosing in connection
with the negotiation and execution of this Agreement and to obtain the advice of
such counsel with respect to all matters contained herein, including, without
limitation, the provision for waiver of trial by jury.  The Borrower
further acknowledges that it is experienced with respect to financial and credit
matters and has made its own independent decisions to apply to the Lenders for
credit and to execute and deliver this Agreement.

       

      12.4.    Severability.  If
any provision of this Agreement shall be declared to be illegal or unenforceable
in any respect, such illegal or unenforceable provision shall be and become
absolutely null and void and of no force and effect as though such provision
were not in fact set forth herein, but all other covenants, terms, conditions
and provisions hereof shall nevertheless continue to be valid and
enforceable.

       

      12.5.    Usury.  It
is the intent of Lenders and the Borrower in the execution and performance of
this Agreement and the Notes or any Loan Document to remain in strict compliance
with Applicable Law from time to time in effect.  In furtherance
thereof, Lenders and the Borrower stipulate and agree that none of the terms and
provisions contained in the Notes, this Agreement or any Loan Document shall
ever be construed to create a contract to pay for the use, forbearance or
detention of money with interest at a rate or in an amount in excess of the
maximum rate permitted under permissible law (the “Maximum
Rate”).  For purposes of this Agreement, the Notes and any other Loan
Document, “interest” shall include the aggregate of all charges which constitute
interest under Applicable Law that are contracted for, taken, charged, reserved,
or received under this Agreement, the Notes or any other Loan
Document.  The Borrower shall never be required to pay unearned
interest or interest at a rate or in an amount in excess of the Maximum Rate or
amount of interest that may be lawfully charged under Applicable Law, and the
provisions of this paragraph shall control over all other provisions of this
Agreement and the Notes or any Loan Document, which may be in actual or apparent
conflict herewith.  If the Notes are prepaid, or if the maturity of
the Notes is accelerated for any reason, or if under any other contingency the
effective rate or amount of interest which would otherwise be payable under the
Notes would exceed the Maximum Rate or amount of interest any Lender or any
other holder of the Notes is allowed by Applicable Law to charge, contract for,
take, reserve or receive, or in the event any Lender or any holder of the Notes
shall charge, contract for, take, reserve or receive monies that are deemed to
constitute interest which would, in the absence of this provision, increase the
effective rate or amount of interest payable under the Notes to a rate or amount
in excess of that permitted to be charged, contracted for, taken, reserved or
received under Applicable Law then in effect, then the principal amount of the
Notes or the amount of interest which would otherwise be payable under the Notes
or both shall be reduced to the amount allowed under Applicable Law as now or
hereinafter construed by the courts having jurisdiction, and all such moneys so
charged, contracted for, taken, reserved or received that are deemed to
constitute interest in excess of the Maximum Rate or amount of interest
permitted by Applicable Law shall immediately be returned to or credited to the
account of the Borrower upon such determination.  Lenders and the
Borrower further stipulate and agree that, without limitation of the foregoing,
all calculations of the rate or amount of interest contracted for, charged,
taken, reserved or received under the Notes which are made for the purpose of
determining whether such rate or amount exceeds the Maximum Rate, shall be made
to the extent not prohibited by Applicable Law, by amortizing, prorating,
allocating and spreading during the period of the full stated term of the Notes,
all interest at any time contracted for, charged, taken, reserved or received
from the Borrower or otherwise by any Lender or any other holder of the
Notes.

       

       

       

       

      
        
          
          

        

        
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      12.6.    Consent to
Jurisdiction.  THE BORROWER, AGENT, AND EACH LENDER AGREES THAT
ANY SUIT OR PROCEEDING UNDER THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS
MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR ANY FEDERAL COURT
SITTING THEREIN AND CONSENTS TO THE EXCLUSIVE JURISDICTION OF SUCH COURT AND THE
SERVICE OF PROCESS IN ANY SUCH SUIT BEING MADE UPON THE BORROWER, AGENT OR SUCH
LENDER BY FIRST CLASS MAIL, RETURN RECEIPT REQUESTED, ADDRESSED TO BORROWER,
AGENT, OR SUCH LENDER AT THE ADDRESS SPECIFIED IN SECTION 9
HEREOF.  THE BORROWER, AGENT, AND EACH LENDER HEREBY WAIVES ANY
OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH SUIT OR ANY
SUCH COURT OR THAT SUCH SUIT IS BROUGHT IN AN INCONVENIENT COURT.

       

      12.7.    ADDITIONAL
INDEMNITY.  IN ADDITION TO THE INDEMNITY PROVIDED IN
SECTION 10, THE BORROWER SHALL INDEMNIFY AND HOLD AGENT, LENDER, AND THEIR
RESPECTIVE SUCCESSORS, ASSIGNS, AGENTS, AND EMPLOYEES (COLLECTIVELY, THE
“INDEMNIFIED PARTIES”), HARMLESS FROM AND AGAINST ANY AND ALL CLAIMS, ACTIONS,
SUITS, PROCEEDINGS, COSTS, EXPENSES, DAMAGES, FINES, PENALTIES, AND LIABILITIES,
INCLUDING, WITHOUT LIMITATION, ATTORNEYS’ FEES AND COSTS, ARISING OUT OF,
CONNECTED WITH, OR RESULTING FROM (A) THE OPERATION OF THE BORROWER’S
BUSINESSES, (B) ANY INDEMNIFIED PARTY’S PRESERVATION OR ATTEMPTED
PRESERVATION OF COLLATERAL, AND (C) ANY FAILURE OF THE SECURITY INTERESTS
AND LIENS IN THE COLLATERAL GRANTED TO THE AGENT FOR THE BENEFIT OF THE LENDERS
PURSUANT TO THIS AGREEMENT TO BE OR TO REMAIN PERFECTED OR TO HAVE THE PRIORITY
AS CONTEMPLATED THEREIN REGARDLESS OF WHETHER THE CLAIM IS CAUSED BY OR ARISES
OUT OF, IN WHOLE OR IN PART, THE NEGLIGENCE OF ANY INDEMNIFIED PARTY OR MAY BE
BASED ON THE STRICT LIABILITY OF ANY INDEMNIFIED PARTY.  THIS
INDEMNITY SHALL NOT APPLY TO THE EXTENT THE SUBJECT OF THE INDEMNIFICATION IS
CAUSED BY OR ARISES OUT OF THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF ANY
INDEMNIFIED PARTY.  AT THE REQUEST OF ANY INDEMNIFIED PARTY, THE
BORROWER SHALL, AT ITS OWN COST AND EXPENSE, DEFEND OR CAUSE TO BE DEFENDED ANY
AND ALL SUCH ACTIONS OR SUITS THAT MAY BE BROUGHT AGAINST ANY INDEMNIFIED PARTY
AND, IN ANY EVENT, SHALL SATISFY, PAY, AND DISCHARGE ANY AND ALL JUDGMENTS,
AWARDS, PENALTIES, COSTS, AND FINES THAT MAY BE RECOVERED AGAINST ANY
INDEMNIFIED PARTY IN ANY SUCH ACTION, PLUS ALL ATTORNEYS’ FEES AND COSTS RELATED
THERETO TO THE EXTENT PERMITTED BY APPLICABLE LAW; PROVIDED, HOWEVER, THAT SUCH
INDEMNIFIED PARTY SHALL GIVE THE BORROWER (TO THE EXTENT SUCH INDEMNIFIED PARTY
SEEKS INDEMNIFICATION THEREFOR FROM THE BORROWER UNDER THIS SECTION 13.10)
WRITTEN NOTICE OF ANY SUCH CLAIM, DEMAND, OR SUIT AFTER SUCH INDEMNIFIED PARTY
HAS RECEIVED WRITTEN NOTICE THEREOF, AND SUCH INDEMNIFIED PARTY SHALL NOT SETTLE
ANY SUCH CLAIM, DEMAND, OR SUIT, IF SUCH INDEMNIFIED PARTY SEEKS INDEMNIFICATION
THEREFOR FROM THE BORROWER, WITHOUT FIRST GIVING NOTICE TO THE BORROWER OF THE
INDEMNIFIED PARTY’S DESIRE TO SETTLE AND OBTAINING THE CONSENT OF THE BORROWER
TO THE SAME, WHICH CONSENT THE BORROWER HEREBY AGREES NOT TO UNREASONABLY
WITHHOLD.  ALL OBLIGATIONS OF THE BORROWER UNDER THIS
SECTION 13.10 SHALL SURVIVE THE PAYMENT OF THE NOTES AND THE
OBLIGATIONS.

       

       

       

       

      
        
          
          

        

        
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      12.8.    No Waivers Except in
Writing.  No failure or delay on the part of the Agent in
exercising any power or right hereunder or under any other Loan Document shall
operate as a waiver thereof, nor shall any single or partial exercise of any
such right or power, or any abandonment or discontinuance of steps to enforce
such a right or power, preclude any other or further exercise thereof or the
exercise of any other right or power.  No Notice to or demand on the
Borrower or any other Person in any case shall entitle the Borrower or such
other Person to any other or further Notice or demand in similar or other
circumstances.

       

      12.9.    WAIVER OF JURY
TRIAL.  AS TO THIS AGREEMENT THE BORROWER, THE AGENT AND EACH
OF THE LENDERS HEREBY (a) COVENANTS AND AGREES NOT TO ELECT A TRIAL BY JURY
OF ANY ISSUE TRIABLE OF RIGHT BY A JURY, AND (b) WAIVES ANY RIGHT TO TRIAL
BY JURY FULLY TO THE EXTENT THAT ANY SUCH RIGHT SHALL NOW OR HEREAFTER EXIST.
THIS WAIVER OF RIGHT TO TRIAL BY JURY IS SEPARATELY GIVEN, KNOWINGLY AND
VOLUNTARILY, BY THE BORROWER, THE AGENT AND EACH OF THE LENDERS, AND THIS WAIVER
IS INTENDED TO ENCOMPASS INDIVIDUALLY EACH INSTANCE AND EACH ISSUE AS TO WHICH
THE RIGHT OF A JURY TRIAL WOULD OTHERWISE ACCRUE. THE AGENT, THE LENDERS AND THE
BORROWER ARE HEREBY AUTHORIZED AND REQUESTED TO SUBMIT THIS AGREEMENT TO ANY
COURT HAVING JURISDICTION OVER THE SUBJECT MATTER AND THE PARTIES HERETO, SO AS
TO SERVE AS CONCLUSIVE EVIDENCE OF THE FOREGOING WAIVER OF THE RIGHT TO JURY
TRIAL.  FURTHER THE AGENT, THE BORROWER AND EACH OF THE LENDERS HEREBY
CERTIFIES THAT NO REPRESENTATIVE OR AGENT OF ANY OF THEM, RESPECTIVELY, HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, TO ANY OF THE UNDERSIGNED THAT EITHER OF
THE AGENT, THE BORROWER OR ANY OF THE LENDERS WILL NOT SEEK TO ENFORCE THIS
WAIVER OF RIGHT TO JURY TRIAL PROVISION.

       

       

       

       

      
        
          
          

        

        
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      12.10.    Multiple
Counterparts.  This Agreement and each other Loan Document may
be executed in any number of counterparts, all of which, taken together, shall
constitute one and the same instrument.  In making proof of this
agreement, it shall not be necessary to produce or account for more than one
such counterpart which is executed by the party against whom enforcement of such
loan agreement is sought.

       

      12.11.    No Third Party
Beneficiaries.  This Agreement is for the sole and exclusive
benefit of the Borrower, the Agent, and Lenders.  This Agreement does
not create, and is not intended to create, any rights in favor of or enforceable
by any other Person.  This Agreement may be amended or modified by the
agreement of the Borrower, the Agent, and Lenders, without any requirement or
necessity for Notice to, or the consent of or approval of any other
Person.

       

      12.12.    RELEASE OF
LIABILITY.  TO THE MAXIMUM EXTENT NOT PROHIBITED BY LAW FROM
TIME TO TIME IN EFFECT, THE BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY (AND AFTER IT HAS CONSULTED WITH ITS OWN ATTORNEY) IRREVOCABLY AND
UNCONDITIONALLY AGREES THAT NO CLAIM MAY BE MADE BY THE BORROWER AGAINST THE
AGENT, EACH LENDER, OR ANY OF THEIR RESPECTIVE DIRECTORS, OFFICERS, EMPLOYEES,
ATTORNEYS, ACCOUNTANTS, AGENTS OR INSURERS, OR ANY OF THEIR SUCCESSORS AND
ASSIGNS, FOR ANY SPECIAL, INDIRECT, CONSEQUENTIAL OR PUNITIVE DAMAGES IN RESPECT
OF ANY BREACH OR WRONGFUL CONDUCT (WHETHER THE CLAIM IS BASED ON CONTRACT OR
TORT OR DUTY IMPOSED BY LAW) ARISING OUT OF, OR RELATED TO, THE TRANSACTIONS
CONTEMPLATED BY ANY OF THIS AGREEMENT, THE NOTES, OR ANY OTHER LOAN DOCUMENTS,
OR ANY ACT, OMISSION, OR EVENT OCCURRING IN CONNECTION HEREWITH OR
THEREWITH.  IN FURTHERANCE OF THE FOREGOING, THE BORROWER HEREBY
WAIVES, RELEASES AND AGREES NOT TO SUE UPON ANY CLAIM FOR ANY SUCH DAMAGES,
WHETHER OR NOT ACCRUED AND WHETHER OR NOT KNOWN OR SUSPECTED TO EXIST IN ITS
FAVOR.

       

      12.13.    Patriot
Act.  Each Lender and the Agent (for itself and not on behalf
of any Lender) hereby notifies the Borrower that pursuant to the requirements of
the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001) (the “Act”), it is required to obtain, verify and record information that
identifies the Borrower, which information includes the name and address of the
Borrower and other information that will allow such Lender or the Agent, as
applicable, to identify the Borrower in accordance with the Act.

       

       

       

       

      
        
          
          

        

        
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      12.14.    Setoff.  If
an Event of Default occurs and is continuing, any deposits, balances or other
sums credited by or due from Agent or any of the Lenders, or from any such
Affiliate of Agent or any of the Lenders, to the Borrower, may to the fullest
extent not prohibited by applicable law at any time or from time to time,
without regard to the existence, sufficiency or adequacy of any other
collateral, and without Notice or compliance with any other condition precedent
now or hereafter imposed by statute, rule of law or otherwise, all of which are
hereby waived, be set off, appropriated and applied by Agent or such Lender or
Affiliate against any or all of the Obligations irrespective of whether demand
shall have been made and although such obligations may be unmatured, in such
manner as Agent or such Lender or Affiliate  in its sole and absolute
discretion may determine; provided, however, that such right of setoff shall not
apply to any property or deposit of escrow monies being held on behalf of the
obligors under Pledged Assets or on behalf of other third parties that are not
Affiliates of the Borrower, including any non-affiliate lenders with which the
Company has loan servicing arrangements.  Within five (5) Business
Days of making any such set off, appropriation or application, Agent agrees to
notify the Borrower thereof, provided the failure to give such Notice shall not
affect the validity of such set off or appropriation or
application.  ANY AND ALL RIGHTS TO REQUIRE AGENT, SUCH LENDER OR SUCH
AFFILIATE TO EXERCISE ITS RIGHTS OR REMEDIES WITH RESPECT TO ANY OTHER
COLLATERAL WHICH SECURES THE LOAN, PRIOR TO EXERCISING ITS RIGHT OF SETOFF WITH
RESPECT TO SUCH DEPOSITS, CREDITS OR OTHER PROPERTY OF THE BORROWER, ARE HEREBY
KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED.  Each of the Lenders
agrees with each other Lender that (a) if an amount to be set off is to be
applied to indebtedness of the Borrower to such Lender, other than the
Obligations evidenced by the Note held by such Lender, unless such amount is
held by such Lender in connection with a specific relationship with the Borrower
other than that evidenced by the Loan Documents, such amount shall be applied
ratably to such other indebtedness and to the Obligations evidenced by the Note
held by such Lender, and (b) if such Lender shall receive from the Borrower,
whether by voluntary payment, exercise of the right of setoff, counterclaim,
cross action, enforcement of the claim evidenced by the Note held by such Lender
by proceedings against the Borrower at law or in equity or by proof thereof in
bankruptcy, reorganization, liquidation, receivership or similar proceedings, or
otherwise, and shall retain and apply to the payment of the Note held by such
Lender any amount in excess of its ratable portion of the payments received by
all of the Lenders with respect to the Note held by all of the Lenders, such
Lender will make such disposition and arrangements with the other Lenders with
respect to such excess, either by way of distribution, participation, pro tanto
assignment of claims, subrogation or otherwise as shall result in each Lender
receiving in respect of the Note held by it its proportionate payment as
contemplated by this Agreement; provided that if all or any part of such excess
payment is thereafter recovered from such Lender, such disposition and
arrangements shall be rescinded and the amount restored to the extent of such
recovery, but without interest.

       

      12.15.    Entire Agreement;
Amendment.  This Agreement, the Notes, and the other Loan
Documents referred to herein embody the final, entire Agreement among the
parties hereto and supersede any and all prior commitments, agreements,
representations, and understandings, whether written or oral, relating to the
subject matter hereof.  This Agreement and each of the other Loan
Documents may only be amended, terminated, extended or otherwise modified by a
writing signed by the party against which enforcement is sought (except no such
writing shall be required for any party which, pursuant to a specific provision
of any Loan Document, is required to be bound by changes without such party’s
assent).  In no event shall any oral agreements, promises, actions,
inactions, knowledge, course of conduct, course of dealings or the like be
effective to amend, terminate, extend or otherwise modify this Agreement or any
of the other Loan Documents.

       

       

       

       

      
        
          
          

        

        
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      12.16.    Replacement
Documentation.  Upon receipt of an affidavit of an officer of Agent as to the loss, theft, destruction or mutilation
of this Agreement, any other Loan Document, or any other security document which
is not of public record, or an affidavit from any Lender as to the occurrence of
the same to such Lender’s Note, and customary (unsecured, unbonded)
indemnification from the Agent or the Lender, as applicable, reasonably
satisfactory to the Borrower, the Borrower will issue, in lieu thereof, a
replacement Note, Agreement, Loan Document or other security document in the
same principal amount thereof and otherwise of like tenor.

       

      12.17.    Survival.  All
representations, warranties, covenants and agreements of the Borrower herein or
in any other Loan Document, or in any notice, certificate, or other paper
delivered by or on behalf of the Borrower pursuant hereto are significant and
shall be deemed to have been relied upon by Agent and each of the Lenders
notwithstanding any investigation made by Agent or each of the Lenders or on its
behalf and shall survive the delivery of the Loan Documents and the making of
the Loan and each advance pursuant thereto.  No review or approval by
Agent or the Lenders, or by any of their consultants or representatives, of any
opinion letters, certificates by professionals or other item of any nature shall
relieve the Borrower or anyone else of any of the obligations, warranties or
representations made by or on behalf of the Borrower under any one or more of
the Loan Documents.

       

      12.18.   Claims Against Agent or
Lenders.

       

      (a)    Borrower Must
Notify.  The Agent and each of the Lenders shall not be in
default under this Agreement, or under any other Loan Document, unless a written
notice specifically setting forth the claim of the Borrower shall have been
given to Agent and each of the Lenders within thirty (30) days after the
Borrower first had actual knowledge or actual notice of the occurrence of the
event which the Borrower allege gave rise to such claim and the Agent or such
Lender, as the case may be, does not remedy or cure the default, if any there
be, with reasonable promptness thereafter.  Such actual knowledge or
actual notice shall refer to what was actually known by, or expressed in a
written notification furnished to any Authorized Representative.

       

      (b)    Remedies.  If
it is determined by the final order of a court of competent jurisdiction, which
is not subject to further appeal, that Agent or any of the Lenders has breached
any of its obligations under the Loan Documents and has not remedied or cured
the same with reasonable promptness following notice thereof, Agent’s and each
of the Lender’s responsibilities shall be limited to: (i) where the breach
consists of the failure to grant consent or give approval in violation of the
terms and requirements of a Loan Document, the obligation to grant such consent
or give such approval and to pay the Borrower’s reasonable costs and expenses
including, without limitation, reasonable attorneys’ fees and disbursements in
connection with such court proceedings; and (ii) the case of any such failure to
grant such consent or give such approval, or in the case of any other such
default by Agent or any of the Lenders, where it is also so determined that
Agent or any of the Lenders acted in bad faith, the payment of any actual,
direct, compensatory damages sustained by the Borrower as a result thereof plus
the Borrower’s reasonable costs and expenses, including, without limitation,
reasonable attorneys’ fees and disbursements in connection with such court
proceedings.

       

       

       

       

      
        
          
          

        

        
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      (c)    Limitations.  In
no event, however, shall Agent and any of the Lenders be liable to the Borrower
or anyone else for other damages such as, but not limited to, indirect,
speculative, consequential or punitive damages whatever the nature of the breach
by Agent or any of the Lenders of its obligations under this Agreement or under
any of the other Loan Documents.  In no event shall Agent or any of
the Lenders be liable for direct damages to the Borrower or anyone else unless a
written notice specifically setting forth the claim of the Borrower shall have
been given to Agent and each of the Lenders within the time period specified
above.

       

      12.19.   Obligations
Absolute.  Except to the extent prohibited by applicable law
which cannot be waived, the Obligations of the Borrower under the Loan Documents
shall be  absolute, unconditional and irrevocable and shall be paid
strictly in accordance with the terms of the Loan Documents under all
circumstances whatsoever, including, without limitation, the existence of any
claim, set off, defense or other right which the Borrower may have at any time
against Agent or any of the Lenders whether in connection with the Loan or any
unrelated transaction.

       

      12.20.   Time Of the
Essence.  Time is of the essence of each provision of this
Agreement and each other Loan Document.

       

      12.21.   Monthly
Statements.  While Agent may issue invoices or other statements
on a monthly or periodic basis (a “Statement”), it is expressly acknowledged and
agreed that:

       

      (a)    The
failure of Agent to issue any Statement on one or more occasions shall not
affect the Borrower’s obligations to make payments under the Loan Documents as
and when due.

       

      (b)    The
inaccuracy of any Statement shall not be binding upon the Agent or the Lenders
and so the Borrower shall always remain obligated to pay the full amount(s)
required under the Loan Documents as and when due notwithstanding any provision
to the contrary contained in any Statement.

       

      (c)    All
Statements are issued for information purposes only and shall never constitute
any type of offer, acceptance, modification, or waiver of the Loan Documents or
any of the Agent’s or Lenders’ rights or remedies thereunder.

       

      (d)    In no
event shall any Statement serve as the basis for, or a component of, any course
of dealing, course of conduct, or trade practice which would modify, alter, or
otherwise affect the express written terms of the Loan Documents.

       

       

       

       

      
        
          
          

        

        
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      12.22.    Joint and Several
Obligations.  Each of CMP and CMC hereby acknowledges and
agrees that it shall be jointly and severally liable for all of the Obligations
of the Borrower.

       

      12.23.   Waiver and
Release.

       

      (a)    The
Borrower acknowledges and agrees that, to its knowledge, as of the date
hereof:  (i) the Borrower does not have any claim or cause of action
against the Agent or the Lenders arising out of, under or in any way relating to
this Agreement or the Loan Documents, any documents, instruments, agreements,
dealings or other matters in connection with the Loan Documents, the
transactions contemplated by the Loan Documents, or any actions taken or not
taken by the Agent or the Lenders in connection therewith; (ii) the Borrower
does not have any offset rights, counterclaims or defenses of any kind against
payment and performance of the obligations under the Loan Documents; and (iii)
the Agent and the Lenders have heretofore properly performed and satisfied in a
timely manner all of their obligations to the Borrower under the Loan
Documents.

       

      (b)    In
consideration of the covenants of the Agent and the Lenders herein, the Borrower
agrees to eliminate any possibility that any past conditions, acts, omissions,
events, circumstances or matters, of which any the Borrower has knowledge as of
the date hereof, would impair or otherwise adversely affect any of the rights,
interests, contracts, collateral security or rights and remedies of the Agent or
the Lenders under the Loan Documents.  Therefore, the Borrower, on its
own behalf and on behalf of its respective successors and assigns, hereby
waives, releases and discharges the Agent and the Lenders, from any and all
claims, demands, actions or causes of action, of which the Borrower has
knowledge on or before the date hereof and arising out of, under or in any way
relating to the Loan Documents, any documents instruments, agreements, dealings
or other matters connected with the Loan Documents, the transactions
contemplated by the Loan Documents or any actions taken or not taken by the
Agent or the Lenders in connection therewith, including, without limitation, all
matters, claims, transactions or things occurring on or prior to the date hereof
of which the Borrower has knowledge.  The waivers, releases and
discharges in this paragraph shall be effective regardless of any other event
that may occur or not occur prior to, or on or after the date
hereof.

       

      (Remainder
of page intentionally left blank; signature page follows)

       

       

      
         

        
          
            
            

          

          
            Page
84

            
              

            

          

        

      

       

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

       

      BORROWERS:        
CENTERLINE MORTGAGE CAPITAL INC.

       

      By:          /s/ Marc D.
Schnitzer___________________

      (Signature)

       

      Its:           Marc. D. Schnitzer, Chief Executive
Officer__

          (Printed Name
and Title)

       

      CENTERLINE
MORTGAGE PARTNERS INC.

       

      By:          /s/ Andrew J.
Weil_____________________

      (Signature)

       

      Its:           Andrew J. Weil, Chief Executive
Officer     __

          (Printed Name
and Title)

       

      AGENT:                     BANK
OF AMERICA, N.A.

       

      By:           /s/ John F.
Simon______________________

          John F. Simon,
Senior Vice President

       

      LENDERS:                BANK
OF AMERICA, N.A. 

         

                                 
   By:           /s/ John F.
Simon______________________

                                              
  John F.
Simon, Senior Vice President

      

       

       

      (Signature Page to Credit
Agreement)

       

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      

       

      SCHEDULE
1:  LENDERS AND
COMMITMENTS

      

       

      
        	
                Lender

              	
                Commitment
      Amount

              	
                Address
      for Notices

              	
                Address
      for Advance Requests

              
	
                Bank
      of America, N.A.

              	
                $100,000,000.00

              	
                 

                Bank
      of America, N.A.

                One
      Federal Street, 4th
      Floor

                Mail
      Code:  MA5-503-04-16

                Boston,
      Massachusetts 02110

                Attn::
      Mr. John F. Simon

                  Senior Vice
      President

                email:
      john.f.simon@bankofamerica.com

                telephone:
      617-346-4272

                 

              	
                 

                Bank
      of America, N.A.

                One
      Federal Street, 4th
      Floor

                Mail
      Code:  MA5-503-04-16

                Boston,
      Massachusetts 02110

                 

                 

                Attn:  Pauline
      Lettieri

                          Assistant
      Vice President

                email:  pauline.lettieri@bankofamerica.com

                telephone:
      617-346-4008

                 

                 

                Attn:   Charlotte
      Nunez

                           Vice
      President

                email: 
      charlotte.nunez@bankofamerica.com

                telephone: 
      617-346-5816EX-10.1

GRUBB & ELLIS APARTMENT REIT, INC.

AMENDED AND RESTATED SHARE REPURCHASE PLAN

EFFECTIVE AS OF NOVEMBER 5, 2009

The Board of Directors (the “Board”) of Grubb & Ellis Apartment REIT, Inc., a Maryland
corporation (the “Company”), has adopted an amended and restated share repurchase plan (the
“Repurchase Plan”) by which shares of the Company’s common stock, par value $0.01 per share
(“Share”), may be repurchased by the Company from stockholders subject to certain conditions and
limitations. The purpose of this Repurchase Plan is to provide limited interim liquidity for
stockholders (under the conditions and limitations set forth below) until a liquidity event occurs.
No stockholder is required to participate in the Repurchase Plan.

1. Repurchase of Shares. The Company may, at its sole discretion, repurchase Shares presented
to the Company for cash to the extent it has sufficient proceeds to do so and subject to the
conditions and limitations set forth herein. Any and all Shares repurchased by the Company shall be
canceled, and will have the status of authorized but unissued Shares. Shares acquired by the
Company through the Repurchase Plan will not be reissued unless they are first registered with the
United States Securities and Exchange Commission under the Securities Act of 1933, as amended, and
other appropriate state securities laws or otherwise issued in compliance with such laws.

2. Share Repurchases.

Repurchase Price. Unless the Shares are being repurchased in connection with a stockholder’s
death or qualifying disability (as discussed below), the prices per Share at which the Company will
repurchase Shares will be as follows:

	 	(1)	 	For stockholders who have continuously held their Shares for at least one year,
the lower of $9.25 or 92.5% of the price paid to acquire Shares from the Company;

	 	(2)	 	For stockholders who have continuously held their Shares for at least two
years, the lower of $9.50 or 95.0% of the price paid to acquire Shares from the
Company;

	 	(3)	 	For stockholders who have continuously held their Shares for at least three
years, the lower of $9.75 or 97.5% of the price paid to acquire Shares from the
Company; and

	 	(4)	 	For stockholders who have continuously held their Shares for at least four
years, a price determined by our board of directors, but in no event less than 100% of
the price paid to acquire Shares from the Company.

At any time the repurchase price is determined by any method other than the net asset value of
the shares, if we have sold property and have made one or more special distributions to our
stockholders of all or a portion of the net proceeds from such sales, the per share repurchase
price will be reduced by the net sales proceeds per share distributed to investors prior to the
repurchase date.

Our board of directors will, in its sole discretion, determine which distributions, if any,
constitute a special distribution. While our board of directors does not have specific criteria for
determining a special distribution, we expect that a special distribution will only occur upon the
sale of a property and the subsequent distribution of the net sale proceeds.

Death or Disability. If Shares are to be repurchased in connection with a stockholder’s death
or qualifying disability as provided in Section 4, the repurchase price shall be: (i) for
stockholders who have continuously held their Shares for less than four years, 100% of the price
paid to acquire the Shares from the Company; or (ii) for stockholders who have continuously held
their Shares for at least four years, a price determined by the Board, but in no event less than
100% of the price paid to acquire the Shares from the Company. In addition, the Company will waive
the one-year holding period, as described in Section 4, for Shares to be repurchased in connection
with a stockholder’s death or qualifying disability.

Appropriate legal documentation will be required for repurchase requests upon death or
qualifying disability.

3. Funding and Operation of Repurchase Plan. The Company may make purchases under the
Repurchase Plan quarterly, at its sole discretion, on a pro rata basis. Subject to funds being
available, the Company will limit the number of Shares repurchased during any calendar year to five
percent (5.0%) of the weighted average number of Shares outstanding during the prior calendar year.
Funding for the Repurchase Plan will come exclusively from cumulative proceeds we receive from the
sale of Shares under the Company’s Distribution Reinvestment Plan.

4. Stockholder Requirements. Any stockholder may request a repurchase with respect to all or a
designated portion of these Shares, subject to the following conditions and limitations:

Holding Period. Only Shares that have been held by the presenting stockholder for at least one
(1) year are eligible for repurchase by the Company, except for Shares repurchased in connection
with a stockholder’s death or qualifying disability as described below.

Death or Qualifying Disability. The Company will repurchase Shares, including Shares held for
less than the one-year holding period, upon the death of a stockholder who is a natural person,
including Shares held by such stockholder through a revocable grantor trust, or an IRA or other
retirement or profit-sharing plan, after receiving written notice from the estate of the
stockholder, the recipient of the Shares through bequest or inheritance, or, in the case of a
revocable grantor trust, the trustee of such trust, who shall have the sole ability to request
repurchase on behalf of the trust. The Company must receive the written notice within one year
after the death of the stockholder. If spouses are joint registered holders of Shares, the request
to repurchase the Shares may be made if either of the registered holders dies. This waiver of the
one-year holding period will not apply to a stockholder that is not a natural person, such as a
trust (other than a revocable grantor trust), partnership, corporation or other similar entity.

Furthermore, and subject to the conditions and limitations described below, the Company will
repurchase Shares, including Shares held for less than the one-year holding period, by a
stockholder who is a natural person, including Shares held by such stockholder through a revocable
grantor trust, or an IRA or other retirement or profit-sharing plan, with a “qualifying
disability,” as defined below, after receiving written notice from such stockholder provided that
the condition causing the qualifying disability was not preexisting on the date that the
stockholder became a stockholder. The Company must receive the written notice within one year after
such stockholder’s qualifying disability. This waiver of the one-year holding period will not apply
to a stockholder that is not a natural person, such as a trust (other than a revocable grantor
trust), partnership, corporation or other similar entity.

In order for a disability to be considered a “qualifying disability,” (1) the stockholder must
receive a determination of disability based upon a physical or mental condition or impairment
arising after the date the stockholder acquired the Shares to be redeemed, and (2) such
determination of disability must be made by the governmental agency responsible for reviewing the
disability retirement benefits that the stockholder could be eligible to receive (the “applicable
governmental agency”). The “applicable governmental agencies” are limited to the following: (1) if
the stockholder paid Social Security taxes and therefore could be eligible to receive Social
Security disability benefits, then the applicable governmental agency is the Social Security
Administration or the agency charged with responsibility for administering Social Security
disability benefits at that time if other than the Social Security Administration; (2) if the
stockholder did not pay Social Security benefits and therefore could not be eligible to receive
Social Security disability benefits, but the stockholder could be eligible to receive disability
benefits under the Civil Service Retirement System (“CSRS”), then the applicable governmental
agency is the U.S. Office of Personnel Management or the agency charged with responsibility for
administering CSRS benefits at that time if other than the Office of Personnel Management; or (3)
if the stockholder did not pay Social Security taxes and therefore could not be eligible to receive
Social Security benefits but suffered a disability that resulted in the stockholder’s discharge
from military service under conditions that were other than dishonorable and therefore could be
eligible to receive military disability benefits, then the applicable governmental agency is the
Veteran’s Administration or the agency charged with the responsibility for administering military
disability benefits at that time if other than the Veteran’s Administration.

Disability determinations by governmental agencies for purposes other than those listed above,
including but not limited to worker’s compensation insurance, administration or enforcement of the
Rehabilitation Act or Americans with Disabilities Act, or waiver of insurance premiums, will not
entitle a stockholder to the special repurchase terms applicable to stockholders with a “qualifying
disability” unless permitted by the board of directors, in its sole discretion. Repurchase requests
following an award by the applicable governmental agency of disability benefits must be accompanied
by: (1) the investor’s initial application for disability benefits and (2) a Social Security
Administration Notice of Award, a U.S. Office of Personnel Management determination of disability
under CSRS, a Veteran’s Administration record of disability-related discharge or such other
documentation issued by the applicable governmental agency that we deem acceptable and demonstrates
an award of the disability benefits.

We understand that the following disabilities do not entitle a worker to Social Security
disability benefits:

• disabilities occurring after the legal retirement age;

• temporary disabilities; and

• disabilities that do not render a worker incapable of performing substantial gainful
activity.

Therefore, such disabilities will not qualify for the special repurchase terms except in the
limited circumstances when the investor is awarded disability benefits by the other “applicable
governmental agencies” described above. However, where a stockholder requests the repurchase of his
or her Shares due to a disability, and such stockholder does not have a “qualifying disability”
under the terms described above, our board of directors may redeem the stockholder’s Shares in its
discretion on the special terms available for a qualifying disability.

A stockholder that is a trust may request repurchase of the Shares held by the trust on the
terms available in connection with the death or disability of a stockholder if the deceased or
disabled was the sole beneficiary of the trust or if the only other beneficiary of the trust is the
spouse of the deceased or disabled.

Minimum — Maximum. A stockholder must present for repurchase a minimum of 25.0%, and a maximum
of 100% of the Shares owned by the stockholder on the date of presentment. Fractional shares may
not be presented for repurchase unless the stockholder is presenting 100% of his Shares.

No Encumbrances. All Shares presented for repurchase must be owned by the stockholder(s)
making the presentment, or the party presenting the Shares must be authorized to do so by the
owner(s) of the Shares. Such Shares must be fully transferable and not subject to any liens or
other encumbrances.

Share Repurchase Form. The presentment of Shares must be accompanied by a completed Share

Repurchase Request form, a copy of which is attached hereto as Exhibit “A.” All Share certificates
must be properly endorsed.

Deadline for Presentment. All Shares presented and all completed Share Repurchase Request
forms must be received by the Repurchase Agent (as defined below) on or before the last day of the
second month of each calendar quarter in order to have such Shares eligible for repurchase for that
quarter. The Company will repurchase Shares on or about the first day following the end of each
calendar quarter.

Repurchase Request Withdrawal. A stockholder may withdraw his or her repurchase request upon
written notice to the Company at any time prior to the date of repurchase.

Ineffective Withdrawal. In the event the Company receives a written notice of withdrawal from
a stockholder after the Company has repurchased all or a portion of such stockholder’s Shares, the
notice of withdrawal shall be ineffective with respect to the Shares already repurchased, but shall
be effective with respect to any of such stockholder’s Shares that have not been repurchased. The
Company shall provide any such stockholder with prompt written notice of the ineffectiveness or
partial ineffectiveness of such stockholder’s written notice of withdrawal.

Repurchase Agent. All repurchases will be effected on behalf of the Company by a registered
broker-dealer (the “Repurchase Agent”), who shall contract with the Company for such services. All
recordkeeping and administrative functions required to be performed in connection with the
Repurchase Plan will be performed by the Repurchase Agent.

Termination, Amendment or Suspension of Plan. The Repurchase Plan will terminate and the
Company will not accept Shares for repurchase in the event the Shares are listed on any national
securities exchange, the subject of bona fide quotes on any inter-dealer quotation system or
electronic communications network or are the subject of bona fide quotes in the pink sheets.
Additionally, the Board, in its sole discretion, may terminate, amend or suspend the Repurchase
Plan if it determines to do so is in the best interest of the Company. A determination by the Board
to terminate, amend or suspend the Repurchase Plan will require the affirmative vote of a majority
of our directors, including a majority of our independent directors. If the Company terminates,
amends or suspends the Repurchase Plan, the Company will provide stockholders with thirty (30) days
advance written notice and the Company will disclose the changes in the appropriate current or
periodic report filed with the Securities and Exchange Commission.

5. Miscellaneous.

Advisor Ineligible. The Advisor to the Company, Grubb & Ellis Apartment REIT Advisor, LLC,
shall not be permitted to participate in the Repurchase Plan.

Liability. Neither the Company nor the Repurchase Agent shall have any liability to any
stockholder for the value of the stockholder’s Shares, the repurchase price of the stockholder’s
Shares, or for any damages resulting from the stockholder’s presentation of his or her Shares, the
repurchase of the Shares under this Repurchase Plan or from the Company’s determination not to
repurchase Shares under the Repurchase Plan, except as a result of the Company’s or the Repurchase
Agent’s gross negligence, recklessness or violation of applicable law; provided, however, that
nothing contained herein shall constitute a waiver or limitation of any rights or claims a
stockholder may have under federal or state securities laws.

Taxes. Stockholders shall have complete responsibility for payment of all taxes, assessments
and other applicable obligations resulting from the Company’s repurchase of Shares.

Preferential Treatment of Shares Repurchased in Connection with Death or Disability. If there
are insufficient funds to honor all repurchase requests, pending requests will be honored among all
requests for repurchase in any given repurchase period, as follows: first, pro rata as to
repurchases sought upon a stockholder’s death; next, pro rata as to repurchases sought by
stockholders with a “qualifying disability”; and, finally, pro rata as to other repurchase
requests.

1

EXHIBIT “A”

SHARE REPURCHASE REQUEST

The undersigned stockholder of Grubb & Ellis Apartment REIT, Inc. (the “Company”) hereby
requests that, pursuant to the Company’s Share Repurchase Plan, the Company repurchase the number
of shares of Common Stock (the “Shares”) indicated below.

STOCKHOLDER’S NAME:

STOCKHOLDER’S ADDRESS:

TOTAL SHARES OWNED BY STOCKHOLDER:

NUMBER OF SHARES PRESENTED FOR REPURCHASE:

(Note: number of Shares presented for repurchase must be equal to or exceed 25.0% of total
Shares owned.)

REASON FOR REPURCHASE REQUEST (SUBMIT REQUIRED DOCUMENTS, IF APPLICABLE):

[ ] DEATH [ ] QUALIFYING DISABILITY [ ] OTHER

By signing and submitting this form, the undersigned hereby acknowledges and represents to
each of the

Company and the Repurchase Agent the following:

The undersigned is the owner (or duly authorized agent of the owner) of the Shares presented
for repurchase, and thus is authorized to present the Shares for repurchase.

The Shares presented for repurchase are eligible for repurchase pursuant to the Repurchase
Plan. The Shares are fully transferable and have not been assigned, pledged, or otherwise
encumbered in any way.

The undersigned hereby indemnifies and holds harmless the Company, the Repurchase Agent, and
each of their respective officers, directors and employees from and against any liabilities,
damages, expenses, including reasonable attorneys’ fees, arising out of or in connection with any
misrepresentation made herein.

Stock certificates for the Shares presented for repurchase (if applicable) are enclosed,
properly endorsed with signature guaranteed.

The Company’s board of directors has the sole discretion to (1) determine if and when to
repurchase Shares, (2) amend, suspend or terminate the Repurchase Plan, (3) determine which
distributions, if any, constitute a special distribution, and (4) determine whether a stockholder
has a “qualifying disability.”

It is recommended that this Share Repurchase Request and any attached stock certificates be
sent to the

Repurchase Agent, at the address below, via overnight courier, certified mail, or other means of
guaranteed delivery.

Grubb & Ellis Securities, Inc.

Grubb & Ellis Apartment REIT Repurchase Agent

4 Hutton Centre Drive, Suite 700

Santa Ana, California 92707

(877) 888-7348

Date:                             

Stockholder Signature:                                    

Office Use Only

Date Request Received:

2

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