Document:

Exhibit 10.11

 

Execution Version

 

 

REVOLVING CREDIT AND TERM LOAN AGREEMENT

 

Dated as of December 27, 2007

 

by and among

 

CENTERLINE HOLDING COMPANY and

CENTERLINE CAPITAL GROUP INC.,

as the Borrowers,

 

CENTERLINE INVESTOR LP LLC, CENTERLINE INVESTOR LP II LLC, CENTERLINE 

CAPITAL COMPANY LLC, CENTERLINE AFFORDABLE HOUSING ADVISORS LLC,

CENTERLINE/AC INVESTORS LLC, CENTERLINE INVESTORS I LLC,

CENTERLINE REIT INC., CENTERLINE HOLDING TRUST,

CENTERLINE SERVICING INC., CENTERLINE FINANCE CORPORATION, 

CENTERLINE CREDIT MANAGEMENT LLC and CM INVESTOR LLC,

and other named entities party hereto from time to time,

as Guarantors,

 

BANK OF AMERICA, N.A. and other named

entities party hereto from time to time, as Lenders,

 

and

 

BANK OF AMERICA, N.A.,

as Swingline Lender, as Issuing Bank, and as Administrative Agent on
behalf of the Lenders

 

*    
*     *     *    
*

 

BANC OF AMERICA SECURITIES LLC and CITICORP
USA, INC.,

as Co- Lead Arrangers

 

and

 

BANC OF AMERICA SECURITIES LLC, as Book
Manager

 

 

 

	
  1.

  	
   

  	
  DEFINITIONS AND RULES OF INTERPRETATION.

  	
   

  	
  1

  
	
   

  	
   

  	
  1.1

  	
  Definitions

  	
   

  	
  1

  
	
   

  	
   

  	
   

  	
  1.1.1

  	
  Definitions of Borrowers, Guarantors and Affiliates

  	
   

  	
  1

  
	
   

  	
   

  	
   

  	
  1.1.2

  	
  General Definitions

  	
   

  	
  2

  
	
   

  	
   

  	
  1.2

  	
  Rules of Interpretation

  	
   

  	
  23

  
	
  2.

  	
   

  	
  REVOLVING LOANS AND TERM LOAN

  	
   

  	
  25

  
	
   

  	
   

  	
  2.1

  	
  Revolving Loans

  	
   

  	
  25

  
	
   

  	
   

  	
   

  	
  2.1.1

  	
  Commitments to Make Revolving Loans

  	
   

  	
  25

  
	
   

  	
   

  	
   

  	
  2.1.2

  	
  Extension of Revolver Maturity Date

  	
   

  	
  25

  
	
   

  	
   

  	
   

  	
  2.1.3

  	
  Unused Facility Fee

  	
   

  	
  25

  
	
   

  	
   

  	
   

  	
  2.1.4

  	
  Revolving Notes

  	
   

  	
  26

  
	
   

  	
   

  	
   

  	
  2.1.5

  	
  Interest on Revolving Loans

  	
   

  	
  26

  
	
   

  	
   

  	
   

  	
  2.1.6

  	
  Requests for Revolving Loans

  	
   

  	
  27

  
	
   

  	
   

  	
  2.2

  	
  Term Loan

  	
   

  	
  28

  
	
   

  	
   

  	
   

  	
  2.2.1

  	
  Commitments to Make Term Loan

  	
   

  	
  28

  
	
   

  	
   

  	
   

  	
  2.2.2

  	
  Term Notes

  	
   

  	
  29

  
	
   

  	
   

  	
   

  	
  2.2.3

  	
  Interest on Term Loan

  	
   

  	
  29

  
	
   

  	
   

  	
  2.3

  	
  Types of Loans: Conversion and Continuation
  Options

  	
   

  	
  29

  
	
   

  	
   

  	
   

  	
  2.3.1

  	
  Conversion to Different Type of Loan

  	
   

  	
  29

  
	
   

  	
   

  	
   

  	
  2.3.2

  	
  Continuation of Type of Loan

  	
   

  	
  30

  
	
   

  	
   

  	
   

  	
  2.3.3

  	
  LIBOR Rate Loans

  	
   

  	
  30

  
	
   

  	
   

  	
   

  	
  2.3.4

  	
  Notification by Borrowers

  	
   

  	
  30

  
	
   

  	
   

  	
   

  	
  2.3.5

  	
  Amounts, Etc

  	
   

  	
  31

  
	
   

  	
   

  	
  2.4

  	
  Swingline
  Loans

  	
   

  	
  31

  
	
   

  	
   

  	
   

  	
  2.4.1

  	
  Swingline
  Commitment

  	
   

  	
  31

  
	
   

  	
   

  	
   

  	
  2.4.2

  	
  Swingline Loan
  Borrowing Procedure

  	
   

  	
  31

  
	
   

  	
   

  	
   

  	
  2.4.3

  	
  Prepayment

  	
   

  	
  32

  
	
   

  	
   

  	
   

  	
  2.4.4

  	
  Participations

  	
   

  	
  32

  
	
   

  	
   

  	
  2.5

  	
  Reduction of Commitments

  	
   

  	
  33

  
	
   

  	
   

  	
   

  	
  2.5.1

  	
  Elective Reduction of Commitments

  	
   

  	
  33

  
	
   

  	
   

  	
   

  	
  2.5.2

  	
  Pro Rata Reductions in Commitments

  	
   

  	
  33

  
	
  3.

  	
   

  	
  USE OF PROCEEDS

  	
   

  	
  33

  
	
   

  	
   

  	
  3.1

  	
  Use of Proceeds

  	
   

  	
  33

  
	
   

  	
   

  	
   

  	
  3.1.1

  	
  Use of Revolving Loans and Swingline Loans

  	
   

  	
  34

  
	
   

  	
   

  	
   

  	
  3.1.2

  	
  Use of Term Loan

  	
   

  	
  34

  
	
   

  	
   

  	
   

  	
  3.1.3

  	
  Limitations on use of Revolving Loans;
  Reduction in Corporate Revolver Commitment

  	
   

  	
  34

  
	
  4.

  	
   

  	
  REPAYMENT OF REVOLVING LOANS AND TERM LOAN

  	
   

  	
  35

  
	
   

  	
   

  	
  4.1

  	
  Revolving Loans

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
  4.1.1

  	
  Maturity

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
  4.1.2

  	
  Optional Repayments of Revolving Loans

  	
   

  	
  35

  
	
   

  	
   

  	
  4.2

  	
  Term Loan

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
  4.2.1

  	
  Amortization of Term Loan

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
  4.2.2

  	
  Mandatory Prepayments of Term Loan

  	
   

  	
  36

  

 

ii

 

	
   

  	
   

  	
   

  	
  4.2.3

  	
  Application of Mandatory Repayments

  	
   

  	
  36

  
	
   

  	
   

  	
   

  	
  4.2.4

  	
  Optional Prepayments of Term Loan

  	
   

  	
  37

  
	
   

  	
   

  	
  4.3

  	
  Swingline Loans

  	
   

  	
  38

  
	
  5.

  	
   

  	
  LETTERS OF CREDIT

  	
   

  	
  38

  
	
   

  	
   

  	
  5.1

  	
  Letter of Credit Commitments

  	
   

  	
  38

  
	
   

  	
   

  	
   

  	
  5.1.1

  	
  Commitment to Issue Letters of Credit

  	
   

  	
  38

  
	
   

  	
   

  	
   

  	
  5.1.2

  	
  Letter of Credit Applications

  	
   

  	
  39

  
	
   

  	
   

  	
   

  	
  5.1.3

  	
  Terms of Letters of Credit

  	
   

  	
  39

  
	
   

  	
   

  	
   

  	
  5.1.4

  	
  Letter of Credit Participation of Lenders

  	
   

  	
  40

  
	
   

  	
   

  	
   

  	
  5.1.5

  	
  Participations of Lenders

  	
   

  	
  40

  
	
   

  	
   

  	
  5.2

  	
  Reimbursement Obligation of the Borrowers

  	
   

  	
  40

  
	
   

  	
   

  	
  5.3

  	
  Letter of Credit Payments

  	
   

  	
  41

  
	
   

  	
   

  	
  5.4

  	
  Obligations Absolute

  	
   

  	
  42

  
	
   

  	
   

  	
  5.5

  	
  Reliance by Issuer

  	
   

  	
  43

  
	
   

  	
   

  	
  5.6

  	
  Letter of Credit Fees

  	
   

  	
  43

  
	
  6.

  	
   

  	
  CERTAIN GENERAL PROVISIONS

  	
   

  	
  43

  
	
   

  	
   

  	
  6.1

  	
  Fees

  	
   

  	
  43

  
	
   

  	
   

  	
   

  	
  6.1.1

  	
  Administrative Agent’s Fee

  	
   

  	
  43

  
	
   

  	
   

  	
   

  	
  6.1.2

  	
  Closing Fees

  	
   

  	
  43

  
	
   

  	
   

  	
  6.2

  	
  Payments to Administrative Agent

  	
   

  	
  43

  
	
   

  	
   

  	
  6.3

  	
  No Offsets, Taxes Etc

  	
   

  	
  44

  
	
   

  	
   

  	
   

  	
  6.3.1

  	
  No Offsets

  	
   

  	
  44

  
	
   

  	
   

  	
   

  	
  6.3.2

  	
  Other Taxes

  	
   

  	
  44

  
	
   

  	
   

  	
   

  	
  6.3.3

  	
  Indemnification

  	
   

  	
  44

  
	
   

  	
   

  	
   

  	
  6.3.4

  	
  Non-US Lenders

  	
   

  	
  45

  
	
   

  	
   

  	
   

  	
  6.3.5

  	
  U.S. Lenders

  	
   

  	
  46

  
	
   

  	
   

  	
   

  	
  6.3.6

  	
  Pre-Existing Withholding Requirements

  	
   

  	
  46

  
	
   

  	
   

  	
   

  	
  6.3.7

  	
  Mitigation

  	
   

  	
  47

  
	
   

  	
   

  	
   

  	
  6.3.8

  	
  Refunds

  	
   

  	
  47

  
	
   

  	
   

  	
   

  	
  6.3.9

  	
  Evidence of Payment

  	
   

  	
  47

  
	
   

  	
   

  	
   

  	
  6.3.10

  	
  Survival

  	
   

  	
  48

  
	
   

  	
   

  	
  6.4

  	
  Computations

  	
   

  	
  48

  
	
   

  	
   

  	
  6.5

  	
  Interest Limitation

  	
   

  	
  48

  
	
   

  	
   

  	
  6.6

  	
  Inability to Determine LIBOR Rate

  	
   

  	
  48

  
	
   

  	
   

  	
  6.7

  	
  Illegality.

  	
   

  	
  49

  
	
   

  	
   

  	
  6.8

  	
  Additional Costs, Etc

  	
   

  	
  49

  
	
   

  	
   

  	
   

  	
  6.8.1

  	
  Taxes

  	
   

  	
  49

  
	
   

  	
   

  	
   

  	
  6.8.2

  	
  Reserves

  	
   

  	
  49

  
	
   

  	
   

  	
   

  	
  6.8.3

  	
  Other Costs

  	
   

  	
  49

  
	
   

  	
   

  	
  6.9

  	
  Capital Adequacy

  	
   

  	
  50

  
	
   

  	
   

  	
  6.10

  	
  Certificate

  	
   

  	
  51

  
	
   

  	
   

  	
  6.11

  	
  Mitigation Obligations; Replacement of
  Lenders

  	
   

  	
  51

  
	
   

  	
   

  	
   

  	
  6.11.1

  	
  Designation of a Different Lending Office

  	
   

  	
  51

  
	
   

  	
   

  	
   

  	
  6.11.2

  	
  Replacement of Lenders

  	
   

  	
  51

  
	
   

  	
   

  	
   

  	
  6.11.3

  	
  Survival

  	
   

  	
  51

  
	
   

  	
   

  	
  6.12

  	
  Indemnity

  	
   

  	
  51

  

 

iii

 

	
   

  	
   

  	
  6.13

  	
  Interest and Fees After Event of Default

  	
   

  	
  52

  
	
   

  	
   

  	
  6.14

  	
  Replacement of Lenders

  	
   

  	
  52

  
	
  7.

  	
   

  	
  CONDITIONS PRECEDENT

  	
   

  	
  53

  
	
   

  	
   

  	
  7.1

  	
  Documents

  	
   

  	
  53

  
	
   

  	
   

  	
  7.2

  	
  Other Conditions Precedent to any Loans

  	
   

  	
  53

  
	
  8.

  	
   

  	
  REPRESENTATIONS AND WARRANTIES

  	
   

  	
  54

  
	
   

  	
   

  	
  8.1

  	
  Financial Information

  	
   

  	
  54

  
	
   

  	
   

  	
  8.2

  	
  Litigation

  	
   

  	
  54

  
	
   

  	
   

  	
  8.3

  	
  Good Title and No Liens

  	
   

  	
  55

  
	
   

  	
   

  	
  8.4

  	
  Franchise,
  Patents, Copyrights, Etc

  	
   

  	
  55

  
	
   

  	
   

  	
  8.5

  	
  Entity Matters

  	
   

  	
  55

  
	
   

  	
   

  	
   

  	
  8.5.1

  	
  Organization

  	
   

  	
  55

  
	
   

  	
   

  	
   

  	
  8.5.2

  	
  Ownership

  	
   

  	
  56

  
	
   

  	
   

  	
   

  	
  8.5.3

  	
  Taxpayer Identification Numbers

  	
   

  	
  56

  
	
   

  	
   

  	
   

  	
  8.5.4

  	
  Equity Interests

  	
   

  	
  56

  
	
   

  	
   

  	
  8.6

  	
  Authorization

  	
   

  	
  56

  
	
   

  	
   

  	
  8.7

  	
  Valid and Binding

  	
   

  	
  57

  
	
   

  	
   

  	
  8.8

  	
  Deferred Compensation and ERISA

  	
   

  	
  57

  
	
   

  	
   

  	
  8.9

  	
  No Materially Adverse Contracts, Etc

  	
   

  	
  57

  
	
   

  	
   

  	
  8.10

  	
  Compliance With Other Instruments, Laws, Etc

  	
   

  	
  58

  
	
   

  	
   

  	
  8.11

  	
  Tax Status

  	
   

  	
  58

  
	
   

  	
   

  	
  8.12

  	
  Holding Company and Investment Company Acts

  	
   

  	
  58

  
	
   

  	
   

  	
  8.13

  	
  Certain Transactions

  	
   

  	
  58

  
	
   

  	
   

  	
  8.14

  	
  Loan Documents

  	
   

  	
  59

  
	
   

  	
   

  	
  8.15

  	
  Regulations U and X

  	
   

  	
  59

  
	
   

  	
   

  	
  8.16

  	
  Solvency

  	
   

  	
  59

  
	
   

  	
   

  	
  8.17

  	
  No Material Change; No Default

  	
   

  	
  59

  
	
   

  	
   

  	
  8.18

  	
  Insurance.

  	
   

  	
  59

  
	
   

  	
   

  	
  8.19

  	
  Use of Proceeds

  	
   

  	
  59

  
	
   

  	
   

  	
  8.20

  	
  Labor Matters

  	
   

  	
  59

  
	
   

  	
   

  	
  8.21

  	
  Exchange Listing

  	
   

  	
  60

  
	
   

  	
   

  	
  8.22

  	
  No Broker or Finder

  	
   

  	
  60

  
	
   

  	
   

  	
  8.23

  	
  Information True, Complete and Not
  Misleading

  	
   

  	
  60

  
	
  9.

  	
   

  	
  AFFIRMATIVE COVENANTS

  	
   

  	
  60

  
	
   

  	
   

  	
  9.1

  	
  Punctual Payment

  	
   

  	
  60

  
	
   

  	
   

  	
  9.2

  	
  Maintenance of Location and Office

  	
   

  	
  60

  
	
   

  	
   

  	
  9.3

  	
  Organizational Number

  	
   

  	
  61

  
	
   

  	
   

  	
  9.4

  	
  Records and Accounts

  	
   

  	
  61

  
	
   

  	
   

  	
  9.5

  	
  Delivery of Financial Statements and
  Notices

  	
   

  	
  61

  
	
   

  	
   

  	
   

  	
  9.5.1

  	
  Financial Statements, Reports, Etc

  	
   

  	
  61

  
	
   

  	
   

  	
   

  	
  9.5.2

  	
  Notices

  	
   

  	
  62

  
	
   

  	
   

  	
   

  	
  9.5.3

  	
  True, Accurate and Complete Financial Statements

  	
   

  	
  64

  
	
   

  	
   

  	
   

  	
  9.5.4

  	
  Revisions to Schedule 8.5.2.

  	
   

  	
  64

  
	
   

  	
   

  	
  9.6

  	
  Existence; Conduct of Business

  	
   

  	
  64

  
	
   

  	
   

  	
   

  	
  9.6.1

  	
  Statutory Trusts

  	
   

  	
  64

  
	
   

  	
   

  	
   

  	
  9.6.2

  	
  Corporations

  	
   

  	
  64

  

 

iv

 

	
   

  	
   

  	
   

  	
  9.6.3

  	
  Limited Liability Companies

  	
   

  	
  64

  
	
   

  	
   

  	
  9.7

  	
  Insurance

  	
   

  	
  65

  
	
   

  	
   

  	
  9.8

  	
  Taxes and Trade Debt

  	
   

  	
  65

  
	
   

  	
   

  	
  9.9

  	
  Compliance with Laws, Contracts, Licenses,
  and Permits

  	
   

  	
  65

  
	
   

  	
   

  	
  9.10

  	
  Indemnification Against Payment of Brokers’
  Fees

  	
   

  	
  65

  
	
   

  	
   

  	
  9.11

  	
  Fiscal Year

  	
   

  	
  66

  
	
   

  	
   

  	
  9.12

  	
  Place for Records; Inspection

  	
   

  	
  66

  
	
   

  	
   

  	
  9.13

  	
  Replacement Documentation

  	
   

  	
  66

  
	
   

  	
   

  	
  9.14

  	
  Further Assurances

  	
   

  	
  66

  
	
   

  	
   

  	
  9.15

  	
  Guaranties

  	
   

  	
  66

  
	
   

  	
   

  	
  9.16

  	
  Additional Information

  	
   

  	
  66

  
	
   

  	
   

  	
  9.17

  	
  Exchange Listing

  	
   

  	
  67

  
	
   

  	
   

  	
  9.18

  	
  Consolidated EBITDA Covenant; Additional
  Guarantors and Pledged Entities

  	
   

  	
  67

  
	
   

  	
   

  	
   

  	
  9.18.1

  	
  Consolidated EBITDA Covenant

  	
   

  	
  67

  
	
   

  	
   

  	
   

  	
  9.18.2

  	
  Additional Guarantors or Pledged Entities

  	
   

  	
  67

  
	
   

  	
   

  	
  9.19

  	
  EIT Preferred Shares Covenants

  	
   

  	
  67

  
	
   

  	
   

  	
  9.20

  	
  Ownership of CCG, Guarantors and Pledged
  Entities

  	
   

  	
  67

  
	
   

  	
   

  	
  9.21

  	
  Blizzard

  	
   

  	
  68

  
	
   

  	
   

  	
  9.22

  	
  Payment of Deferred Fees

  	
   

  	
  68

  
	
   

  	
   

  	
  9.23

  	
  Funding of the Unfunded Escrow

  	
   

  	
  69

  
	
   

  	
   

  	
  9.24

  	
  Revolving Loan/Term Loan True Up

  	
   

  	
  69

  
	
  10.

  	
   

  	
  NEGATIVE COVENANTS; FINANCIAL COVENANTS

  	
   

  	
  69

  
	
   

  	
   

  	
  10.1

  	
  Liens

  	
   

  	
  69

  
	
   

  	
   

  	
   

  	
  10.1.1

  	
  Affordable Housing Syndications

  	
   

  	
  69

  
	
   

  	
   

  	
   

  	
  10.1.2

  	
  Governmental Charges

  	
   

  	
  69

  
	
   

  	
   

  	
   

  	
  10.1.3

  	
  Liens Contemplated Hereby

  	
   

  	
  70

  
	
   

  	
   

  	
   

  	
  10.1.4

  	
  Warehouse Lines

  	
   

  	
  70

  
	
   

  	
   

  	
   

  	
  10.1.5

  	
  Existing Liens

  	
   

  	
  70

  
	
   

  	
   

  	
   

  	
  10.1.6

  	
  Mechanics
  Liens, etc

  	
   

  	
  70

  
	
   

  	
   

  	
   

  	
  10.1.7

  	
  Pledges & Deposits

  	
   

  	
  70

  
	
   

  	
   

  	
   

  	
  10.1.8

  	
  Bids

  	
   

  	
  70

  
	
   

  	
   

  	
   

  	
  10.1.9

  	
  Easements

  	
   

  	
  70

  
	
   

  	
   

  	
   

  	
  10.1.10

  	
  Judgments

  	
   

  	
  71

  
	
   

  	
   

  	
   

  	
  10.1.11

  	
  Purchase Money

  	
   

  	
  71

  
	
   

  	
   

  	
   

  	
  10.1.12

  	
  Precautionary UCC Financing Statements

  	
   

  	
  71

  
	
   

  	
   

  	
   

  	
  10.1.13

  	
  Bankers’ Liens

  	
   

  	
  71

  
	
   

  	
   

  	
   

  	
  10.1.14

  	
  Licenses

  	
   

  	
  71

  
	
   

  	
   

  	
   

  	
  10.1.15

  	
  Public Utilities

  	
   

  	
  71

  
	
   

  	
   

  	
   

  	
  10.1.16

  	
  Debt Liens

  	
   

  	
  71

  
	
   

  	
   

  	
   

  	
  10.1.17

  	
  Bond Transaction
  and Future Bond Transactions

  	
   

  	
  71

  
	
   

  	
   

  	
  10.2

  	
  Double Negative Pledge

  	
   

  	
  72

  
	
   

  	
   

  	
   

  	
  10.2.1

  	
  Negative Pledge

  	
   

  	
   

  	
  72

  
	
   

  	
   

  	
   

  	
  10.2.2

  	
  Double Negative Pledge

  	
   

  	
  72

  
	
   

  	
   

  	
  10.3

  	
  Indebtedness

  	
   

  	
  72

  
	
   

  	
   

  	
   

  	
  10.3.1

  	
  Types of Permitted Indebtedness and Persons
  to whom they Apply: Set forth
  below is a list of each type of Permitted Indebtedness 

  	
   

  	
   

  
									

 

v

 

	
   

  	
   

  	
   

  	
   

  	
  with a listing regarding which entities may incur, the particular
  type of Permitted Indebtedness:

  	
   

  	
  72

  
	
   

  	
   

  	
   

  	
  10.3.2

  	
  CHC

  	
   

  	
  75

  
	
   

  	
   

  	
   

  	
  10.3.3

  	
  The Borrowers

  	
   

  	
  75

  
	
   

  	
   

  	
   

  	
  10.3.4

  	
  CCG

  	
   

  	
  75

  
	
   

  	
   

  	
   

  	
  10.3.5

  	
  Centerline Investors

  	
   

  	
  76

  
	
   

  	
   

  	
   

  	
  10.3.6

  	
  EIT

  	
   

  	
  76

  
	
   

  	
   

  	
  10.4

  	
  Merger; Ownership Interests; Sale of Assets

  	
   

  	
  76

  
	
   

  	
   

  	
   

  	
  10.4.1

  	
  Mergers, Consolidations and Asset Sales

  	
   

  	
  76

  
	
   

  	
   

  	
   

  	
  10.4.2

  	
  Other Asset Transfers

  	
   

  	
  76

  
	
   

  	
   

  	
  10.5

  	
  Loans, Guarantees and Investments

  	
   

  	
  76

  
	
   

  	
   

  	
  10.6

  	
  Distributions Prior to Default

  	
   

  	
  77

  
	
   

  	
   

  	
  10.7

  	
  Distributions After Default

  	
   

  	
  77

  
	
   

  	
   

  	
   

  	
  10.7.1

  	
  CHC

  	
   

  	
  77

  
	
   

  	
   

  	
   

  	
  10.7.2

  	
  Guarantors and Pledged Entities

  	
   

  	
  78

  
	
   

  	
   

  	
   

  	
  10.7.3

  	
  Distributions

  	
   

  	
  78

  
	
   

  	
   

  	
  10.8

  	
  Affiliate Indebtedness

  	
   

  	
  78

  
	
   

  	
   

  	
  10.9

  	
  Purchase of Margin Stock

  	
   

  	
  78

  
	
   

  	
   

  	
  10.10

  	
  Transactions with Affiliates

  	
   

  	
  78

  
	
   

  	
   

  	
  10.11

  	
  Amendment to Governing Documents

  	
   

  	
  78

  
	
   

  	
   

  	
  10.12

  	
  Business Lines

  	
   

  	
  79

  
	
   

  	
   

  	
  10.13

  	
  Competing Businesses

  	
   

  	
  79

  
	
   

  	
   

  	
  10.14

  	
  Consolidated GAAP Net Worth

  	
   

  	
  79

  
	
   

  	
   

  	
  10.15

  	
  Consolidated EBITDA to Fixed Charges Ratio

  	
   

  	
  79

  
	
   

  	
   

  	
  10.16

  	
  Funded Debt to Consolidated EBITDA Ratio

  	
   

  	
  79

  
	
   

  	
   

  	
  10.17

  	
  Stock Buy-Backs

  	
   

  	
  79

  
	
  11.

  	
   

  	
  DEFAULT

  	
   

  	
  80

  
	
   

  	
   

  	
  11.1

  	
  Events of Default.

  	
   

  	
  80

  
	
   

  	
   

  	
   

  	
  11.1.1

  	
  Failure to Pay

  	
   

  	
  80

  
	
   

  	
   

  	
   

  	
  11.1.2

  	
  Failure to Perform

  	
   

  	
  80

  
	
   

  	
   

  	
   

  	
  11.1.3

  	
  Breach of Representation or Warranty

  	
   

  	
  80

  
	
   

  	
   

  	
   

  	
  11.1.4

  	
  Failure to Pay Other Indebtedness

  	
   

  	
  80

  
	
   

  	
   

  	
   

  	
  11.1.5

  	
  Insolvency

  	
   

  	
  81

  
	
   

  	
   

  	
   

  	
  11.1.6

  	
  Involuntary Proceedings

  	
   

  	
  81

  
	
   

  	
   

  	
   

  	
  11.1.7

  	
  Judgments

  	
   

  	
  81

  
	
   

  	
   

  	
   

  	
  11.1.8

  	
  Cancellation of Loan Documents

  	
   

  	
  81

  
	
   

  	
   

  	
   

  	
  11.1.9

  	
  ERISA

  	
   

  	
  82

  
	
   

  	
   

  	
   

  	
  11.1.10

  	
  Indictment

  	
   

  	
  82

  
	
   

  	
   

  	
   

  	
  11.1.11

  	
  Material Adverse Change

  	
   

  	
  82

  
	
   

  	
   

  	
  11.2

  	
  Remedies Upon Event of Default

  	
   

  	
  82

  
	
   

  	
   

  	
   

  	
  11.2.1

  	
  Accelerate Debt

  	
   

  	
  82

  
	
   

  	
   

  	
   

  	
  11.2.2

  	
  Pursue Remedies

  	
   

  	
  82

  
	
   

  	
   

  	
   

  	
  11.2.3

  	
  Power of Attorney

  	
   

  	
  83

  
	
   

  	
   

  	
  11.3

  	
  Written Waivers

  	
   

  	
  83

  
	
   

  	
   

  	
  11.4

  	
  Allocation of Proceeds

  	
   

  	
  83

  
	
   

  	
   

  	
  11.5

  	
  Performance by the Administrative Agent

  	
   

  	
  84

  

 

vi

 

	
   

  	
   

  	
  11.6

  	
  Rights Cumulative

  	
   

  	
  84

  
	
  12.

  	
   

  	
  SETOFF.

  	
   

  	
  84

  
	
  13.

  	
   

  	
  THE ADMINISTRATIVE AGENT

  	
   

  	
  85

  
	
   

  	
   

  	
  13.1

  	
  Authorization

  	
   

  	
  85

  
	
   

  	
   

  	
   

  	
  13.1.1

  	
  Authorization to Act

  	
   

  	
  85

  
	
   

  	
   

  	
   

  	
  13.1.2

  	
  Independent Contractor

  	
   

  	
  86

  
	
   

  	
   

  	
   

  	
  13.1.3

  	
  Representative

  	
   

  	
  86

  
	
   

  	
   

  	
   

  	
  13.1.4

  	
  Regarding Collateral

  	
   

  	
  86

  
	
   

  	
   

  	
  13.2

  	
  Employees, Advisors and the Administrative
  Agent

  	
   

  	
  86

  
	
   

  	
   

  	
  13.3

  	
  No Liability

  	
   

  	
  86

  
	
   

  	
   

  	
  13.4

  	
  No Representations

  	
   

  	
  87

  
	
   

  	
   

  	
   

  	
  13.4.1

  	
  General

  	
   

  	
  87

  
	
   

  	
   

  	
   

  	
  13.4.2

  	
  Closing
  Documentation, Etc

  	
   

  	
  88

  
	
   

  	
   

  	
  13.5

  	
  Payments.

  	
   

  	
  88

  
	
   

  	
   

  	
   

  	
  13.5.1

  	
  Payments to Administrative Agent

  	
   

  	
  88

  
	
   

  	
   

  	
   

  	
  13.5.2

  	
  Distribution by Administrative Agent

  	
   

  	
  88

  
	
   

  	
   

  	
   

  	
  13.5.3

  	
  Delinquent Lenders

  	
   

  	
  88

  
	
   

  	
   

  	
   

  	
  13.5.4

  	
  Indemnity

  	
   

  	
  89

  
	
   

  	
   

  	
  13.6

  	
  Administrative Agent as Lender, Swingline
  Lender and Issuing Bank

  	
   

  	
  89

  
	
   

  	
   

  	
  13.7

  	
  Resignation

  	
   

  	
  89

  
	
   

  	
   

  	
  13.8

  	
  Notification of Defaults

  	
   

  	
  90

  
	
   

  	
   

  	
  13.9

  	
  Duties in the Case of Enforcement

  	
   

  	
  90

  
	
   

  	
   

  	
  13.10

  	
  Administrative Agent May File Proofs
  of Claim

  	
   

  	
  91

  
	
  14.

  	
   

  	
  EXPENSES

  	
   

  	
  92

  
	
  15.

  	
   

  	
  INDEMNIFICATION

  	
   

  	
  93

  
	
  16.

  	
   

  	
  SURVIVAL OF COVENANTS, JOINT AND SEVERAL
  OBLIGATIONS, ETC

  	
   

  	
  93

  
	
   

  	
   

  	
  16.1

  	
  Survival

  	
   

  	
  93

  
	
   

  	
   

  	
  16.2

  	
  Joint and Several Obligations

  	
   

  	
  94

  
	
   

  	
   

  	
  16.3

  	
  Maximum Amount

  	
   

  	
  94

  
	
  17.

  	
   

  	
  ASSIGNMENT AND PARTICIPATION

  	
   

  	
  94

  
	
   

  	
   

  	
  17.1

  	
  General Conditions

  	
   

  	
  94

  
	
   

  	
   

  	
  17.2

  	
  Assignments

  	
   

  	
  95

  
	
   

  	
   

  	
   

  	
  17.2.1

  	
  Minimum Assignments

  	
   

  	
  95

  
	
   

  	
   

  	
   

  	
  17.2.2

  	
  Deliverables

  	
   

  	
  95

  
	
   

  	
   

  	
   

  	
  17.2.3

  	
  Joinder

  	
   

  	
  95

  
	
   

  	
   

  	
  17.3

  	
  Register; Accounts

  	
   

  	
  96

  
	
   

  	
   

  	
  17.4

  	
  Participations

  	
   

  	
  96

  
	
   

  	
   

  	
  17.5

  	
  Payments to Participants

  	
   

  	
  97

  
	
   

  	
   

  	
  17.6

  	
  Miscellaneous Assignment Provisions

  	
   

  	
  97

  
	
   

  	
   

  	
  17.7

  	
  Assignee or Participant Affiliated with CHC

  	
   

  	
  97

  
	
   

  	
   

  	
  17.8

  	
  Recordation in Register

  	
   

  	
  98

  
	
  18.

  	
   

  	
  NOTICES, ETC

  	
   

  	
  98

  
	
  19.

  	
   

  	
  GOVERNING LAW; JURISDICTION; VENUE

  	
   

  	
  99

  
	
  20.

  	
   

  	
  HEADINGS

  	
   

  	
  99

  
	
  21.

  	
   

  	
  COUNTERPARTS

  	
   

  	
  99

  
	
  22.

  	
   

  	
  ENTIRE
  AGREEMENT, ETC

  	
   

  	
  100

  

 

vii

 

	
   

  	
   

  	
  22.1

  	
  Entire Agreement

  	
   

  	
  100

  
	
   

  	
   

  	
  22.2

  	
  Additional Guarantors and Pledged Entities

  	
   

  	
  100

  
	
  23.

  	
   

  	
  CONSENTS,
  AMENDMENTS, WAIVERS, ETC

  	
   

  	
  100

  
	
   

  	
   

  	
  23.1

  	
  General Rule

  	
   

  	
  100

  
	
   

  	
   

  	
   

  	
  23.1.1

  	
  Affected Lenders

  	
   

  	
  100

  
	
   

  	
   

  	
   

  	
  23.1.2

  	
  All Lenders

  	
   

  	
  101

  
	
   

  	
   

  	
   

  	
  23.1.3

  	
  Administrative Agent, Issuing Bank and
  Swingline Lender

  	
   

  	
  101

  
	
   

  	
   

  	
   

  	
  23.1.4

  	
  Upon Change in Administrative Agent,
  Swingline Lender or Issuing Bank

  	
   

  	
  101

  
	
   

  	
   

  	
  23.2

  	
  Waivers

  	
   

  	
  102

  
	
   

  	
   

  	
  23.3

  	
  Reasonable Cooperation by Creditor Parties

  	
   

  	
  102

  
	
   

  	
   

  	
  23.4

  	
  Amendments Requiring Freddie Mac’s Consent

  	
   

  	
  102

  
	
  24.

  	
   

  	
  SEVERABILITY

  	
   

  	
  102

  
	
  25.

  	
   

  	
  CONFIDENTIALITY

  	
   

  	
  102

  
	
   

  	
   

  	
  25.1

  	
  Confidentiality

  	
   

  	
  102

  
	
   

  	
   

  	
  25.2

  	
  Definition of Information

  	
   

  	
  103

  
	
   

  	
   

  	
  25.3

  	
  Compliance Standard

  	
   

  	
  103

  
	
   

  	
   

  	
  25.4

  	
  Intralinks and Public Lenders

  	
   

  	
  104

  
	
  26.

  	
   

  	
  USA PATRIOT ACT

  	
   

  	
  104

  
	
  27.

  	
   

  	
  NO ADVISORY OR FIDUCIARY RESPONSIBILITY

  	
   

  	
  104

  
	
  28.

  	
   

  	
  DESIGNATION OF PERMITTED LIENS

  	
   

  	
  105

  
	
  29.

  	
   

  	
  WAIVER OF JURY TRIAL

  	
   

  	
  105

  

 

Exhibits

 7

	
  Exhibit 1.1A

  	
   

  	
  Applicable
  Margin

  
	
  Exhibit 1.1B

  	
   

  	
  Form of
  Guaranty

  
	
  Exhibit 1.1C

  	
   

  	
  Form of
  Pledge Agreement

  
	
  Exhibit 1.1D

  	
   

  	
  Risk-Adjusted
  Contingent Liabilities

  
	
  Exhibit 2.1.4

  	
   

  	
  Form of
  Revolving Note

  
	
  Exhibit 2.1.6

  	
   

  	
  Form of
  Revolving Loan Request

  
	
  Exhibit 2.2.2

  	
   

  	
  Form of
  Term Note

  
	
  Exhibit 2.3.1

  	
   

  	
  Form of
  Conversion or Continuation Request

  
	
  Exhibit 2.4.2

  	
   

  	
  Form of
  Swingline Loan Request

  
	
  Exhibit 6.3.4

  	
   

  	
  Form of
  Non-U.S. Lender Certificate

  
	
  Exhibit 7.1

  	
   

  	
  Closing
  Checklist

  
	
  Exhibit 9.5.1(c)

  	
   

  	
  Form of
  Compliance Certificate

  
	
  Exhibit 17.2.2

  	
   

  	
  Form of
  Assignment and Acceptance

  

 

Schedules

 

	
  Schedule 1A

  	
   

  	
  Guarantors
  and Pledged Entities

  
	
  Schedule 1B

  	
   

  	
  Definition
  of Blizzard

  
	
  Schedule 2

  	
   

  	
  Lender
  Register

  
	
  Schedule 3

  	
   

  	
  Administrative
  Agent’s Office; Certain Addresses for Notices

  

 

viii

 

	
  Schedule
  4.2.2

  	
   

  	
  Designated
  Assets

  
	
  Schedule 5

  	
   

  	
  Existing
  Letter of Credit

  
	
  Schedule 8.2

  	
   

  	
  Litigation

  
	
  Schedule 8.3

  	
   

  	
  Permitted
  Liens

  
	
  Schedule
  8.5.1

  	
   

  	
  Organization

  
	
  Schedule
  8.5.2

  	
   

  	
  Ownership

  
	
  Schedule
  8.5.3

  	
   

  	
  Tax Payer
  Identification Numbers

  
	
  Schedule
  8.5.4

  	
   

  	
  Rights with
  Respect to Equity Interests

  
	
  Schedule
  8.13

  	
   

  	
  Related
  Party Transactions

  
	
  Schedule
  10.3.1

  	
   

  	
  Permitted
  Indebtedness

  

 

ix

 

REVOLVING
CREDIT AND TERM LOAN AGREEMENT

 

THIS REVOLVING CREDIT AND TERM LOAN AGREEMENT (this “Credit Agreement”)
dated as of December 27, 2007 is by and among CENTERLINE HOLDING COMPANY,
a Delaware statutory trust (“CHC”), and CENTERLINE CAPITAL GROUP INC., a
Delaware corporation (“CCG”) (each a “Borrower” and collectively, the “Borrowers”);
those Persons (as defined below) listed as Guarantors on Schedule 1A as
of the date hereof and any other Person who may from time to time be listed on
such Schedule in accordance with this Credit Agreement (each a “Guarantor” and
collectively, the “Guarantors”); BANK OF AMERICA, N.A. and the other lenders party hereto as listed on Schedule
2 from time to time in accordance with this Credit Agreement (each a “Lender” and collectively, the “Lenders”);
and BANK OF AMERICA, N.A., as Administrative Agent (as defined below),
as Swingline Lender (in such capacity, the “Swingline Lender”), and as Issuing Bank (in such capacity, the “Issuing
Bank”).

The parties hereto agree as follows:

 

1.                            DEFINITIONS
AND RULES OF INTERPRETATION.

 

1.1         Definitions.

 

1.1.1                        Definitions of Borrowers, Guarantors and
Affiliates.  For purposes
of this Agreement the Borrowers, Guarantors and certain of their Affiliates are
defined as set forth below:

 

Borrower and Borrowers.
See the introductory paragraph to this Credit Agreement.

 

CAHA.  Centerline Affordable Housing Advisors LLC, a
Delaware limited liability company (formerly known as Related Capital Company
LLC and as CharterMac Capital LLC).

 

Centerline/AC.  Centerline/AC Investors LLC, a Delaware
limited liability company.

 

Centerline
Investor LP. 
Centerline Investor LP LLC, a Delaware limited liability company.

 

Centerline
Investor LP II. 
Centerline Investor LP II LLC, a Delaware limited liability company.

 

Centerline Investors. 
Centerline Investors I LLC, a Delaware limited liability company.

 

CCC.  Centerline Capital Company, LLC, a Delaware
limited liability company.

 

CCG.  See the introductory paragraph to this Credit
Agreement.

 

CFin.  Centerline Financial LLC, a Delaware limited
liability company through which CHC indirectly engages in the business of
providing credit intermediation.

 

CFin Holdings.  Centerline Financial Holdings LLC, a Delaware
limited liability company.

 

CHC.  See the introductory paragraph to this Credit
Agreement.

 

CMC.  Centerline Mortgage Capital Inc., a Delaware
corporation.

 

 

CMP.  Centerline Mortgage Partners Inc., a
Delaware corporation.

 

Credit Management.  Centerline
Credit Management LLC, a Delaware limited liability company.

 

EIT.  Centerline Equity Issuer Trust, a Delaware
statutory trust.

 

Guarantor and Guarantors. See the
introductory paragraph to this Credit Agreement.

 

Holding Trust.  Centerline Holding Trust, a Delaware
statutory trust.

 

Pledged
Entities.  (a) Those
Persons who are not Guarantors, but whose Capital Stock is pledged to secure
the Loans as part of the Equity Collateral, and (b) CMC, CMP and CFin
Holdings.

 

SPV I.  Centerline Sponsor 2007-1 Securitization,
LLC, a Delaware limited liability company.

 

SPV II. 
Centerline Stabilization 2007-1 Securitization, LLC, a Delaware limited
liability company.

 

 

1.1.2                        General Definitions.  The following terms shall have the meanings
set forth in this Section or elsewhere in the provisions of this Credit
Agreement referred to below:

 

Acceptable Rating.  See the definition of Cash Equivalents.

 

Act.  See Section 26.

 

Adjustment Date.  The first day of the month immediately
following the date on which a Compliance Certificate is to be delivered by the
Borrowers pursuant to Section 9.5.1(c).

 

Administrative Agent.  Bank of America, in its
capacity as administrative agent under any of the Loan Documents, or any
successor administrative agent.

 

Administrative Agent’s Fee. See Section 6.1.1.

 

Administrative Agent’s Office.
The Administrative Agent’s address and, as appropriate, account as set forth on
Schedule 3, or at such other location as the Administrative Agent may
designate to the Borrowers and the Lenders from time to time.

 

Affiliate.  As to any Person, any other Person directly
or indirectly controlling, controlled by or under direct or indirect common
control with, such Person.  For the
purposes of this definition, “control” (including, with correlative meanings,
the terms “controlling,” “controlled by” and “under common control with”) as
applied to any Person, means directly or indirectly possessing the power (i) to
vote 10% or more of the Capital Stock having ordinary voting power for the
election of directors of such Person, or (ii) to direct or cause the
direction of the management or policies of that Person, whether through the
ownership of voting securities, by agreement, or otherwise.  Notwithstanding the foregoing, Blizzard shall
not be considered an Affiliate of the Borrowers, the Guarantors, the Pledged
Entities or any of their Subsidiaries in the event that Blizzard would be an
Affiliate of any such Persons solely because any such Persons possess by
agreement the power to direct or cause the direction of the management or
policies of Blizzard.

 

2

 

Applicable Law.  All applicable provisions of constitutions,
statutes, rules, regulations and orders of all governmental bodies and all
orders and decrees of all courts, tribunals and arbitrators.

 

Applicable Margin. For each period commencing on an Adjustment Date through the date
immediately preceding the next Adjustment Date, the Applicable Margin
applicable to the Loans shall be as set forth on Exhibit 1.1A.

 

Approved Fund.  Any Fund that is administered or managed by (a) a
Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate
of an entity that administers or manages a Lender.

 

Asset Sale Proceeds. Proceeds realized from any one transaction or series of related
transactions in which CHC or any of its Subsidiaries conveys, sells, transfers,
or otherwise disposes of any of (a) the Equity Collateral, or (b) any
substantial portion of any Borrower’s, Guarantor’s or Pledged Entity’s
operating assets (as distinguished from discrete investment assets).  Asset Sale Proceeds expressly exclude the
proceeds from (A) any conveyance, sale, transfer or other disposition of
(including dispositions to joint ventures): (i) any Capital Stock
in any low income housing tax credit projects or pre-sold mortgage loans in the
ordinary course of business consistent with past practices; (ii) any
assets in the ordinary course of business consistent as to volume and type of
assets with past practices, including in connection with a securitization; (iii) any
assets transferred in exchange for either like assets or assets of a type
typically held by such seller under any of the Permitted Businesses; (iv) any
assets (including Capital Stock) where such proceeds are reinvested within one
hundred eighty (180) days of such sale (or within three hundred sixty five
(365) days of such sale if a contract is executed and delivered within one
hundred eighty (180) days of such sale) in either like assets or assets of a
type typically held by such seller under any of the Permitted Businesses; and (B) the
Bond Transaction and any Future Bond Transaction.  Asset Sale Proceeds shall be net of (w) reasonable
costs and expenses of effecting such sale (including, without limitation,
reasonable legal and brokerage fees to Persons that are not Affiliates of CHC,
or, to the extent such fees are upon terms
and conditions no more favorable to such Affiliate than would be available in
an arms-length transaction between independent parties, to The Related
Companies Group); (x) repayment of Indebtedness secured solely by, and
incurred in connection with the acquisition of, the asset disposed of; (y) any
income or gains tax due and payable arising out of such sale; and (z) reasonable
purchase price reserves (until such time as any portion of such reserves are
released to CHC or such Subsidiary).

 

Assignment and Acceptance. See Section 17.2.2.

 

Balance Sheet Date.  See Section 8.1.

 

Bank of America.
Bank of America, N.A., and its successors.

 

Base Rate. For
any day, a fluctuating rate per annum equal to the rate of interest in effect
for such day as publicly announced from time to time by Bank of America as its “prime
rate.”  The “prime rate” is a rate set by
Bank of America based upon various factors including Bank of America’s costs
and desired return, general economic conditions and other factors, and is used
as a reference point for pricing some loans, which may be priced at, above, or
below such announced rate.  Any change in
such rate announced by Bank of America shall take effect at the opening of
business on the day specified in the public announcement of such change.

 

3

 

Base Rate Loans.
All or any portion of the Revolving Loans, Swingline Loans or the Term Loan
bearing interest calculated by reference to the Base Rate.

 

BBA LIBOR.  See the definition of LIBOR Rate.

 

B Bonds.  Those certain series B certificates held
initially by SPV I in connection with the Bond Transaction.

 

Blizzard.  See Schedule 1B.

 

Blizzard Covenant.  See Schedule 1B.

 

Blizzard Credit Facility.  See Schedule
1B.

 

Blizzard Repayment Proceeds.  See Schedule 1B.

 

Bond Stabilization Escrow Account.  that
certain Stabilization Escrow as such term is defined in the Stabilization
Escrow Agreement.

 

Bond Transaction.  The exchange of a portfolio of bonds from
Centerline 2007-1 EIT Securitization, LLC, Centerline 2007-1 SU Securitization,
LLC and Centerline 2007-1 T Securitization, LLC to Freddie Mac, pursuant
to which Freddie Mac will issue series A certificates to be sold by a
placement agent and series B certificates to be held initially by SPV I
for purposes of a securitization of such portfolio that is credit enhanced by
Freddie Mac pursuant to a Bond Exchange and Sale Agreement dated as of December 1,
2007 among Freddie Mac, Centerline 2007-1 EIT Securitization, LLC, Centerline
2007-1 SU Securitization, LLC, Centerline 2007-1 T Securitization, LLC,
SPV I and SPV II, and the documents contemplated thereby.

 

Borrower Materials.  See Section 25.4.

 

Business Day.  Any day other than a Saturday, Sunday or
other day on which commercial banks are authorized to close under the laws of,
or are in fact closed in, the state where the Administrative Agent’s Office is
located and, if such day relates to any LIBOR Rate Loan, means any such day on
which dealings in Dollar deposits are conducted by and between banks in the London
interbank eurodollar market.

 

Capitalized Lease Obligation. That portion of the obligations under a capital lease that is
required to be capitalized in accordance with GAAP.

 

Capital Stock.
Any and all shares, interests, participations or other equivalents, preferred
or common (however designated) of capital stock of a corporation, any and all
equivalent ownership interests in a Person (other than a corporation) and any
and all warrants, rights or options to purchase any of the foregoing (including
convertible debt instruments).

 

Cash Collateral.  See Section 4.2.3.

 

Cash
Equivalents.  (i) Securities
issued or directly and fully guaranteed or insured by the United States or any
agency or instrumentality thereof (provided that the full faith and credit of
the United States is pledged in support thereof) having maturities of not more
than twelve months from the date of acquisition (“Government Obligations”), (ii) Dollar
denominated (or foreign 

 

4

 

currency fully
hedged to the Dollar) time deposits, certificates of deposit, Eurodollar time
deposits and Eurodollar certificates of deposit of (y) any domestic
commercial bank of recognized standing having capital and surplus in excess of
$250,000,000 or (z) any bank whose short-term commercial paper rating from
S&P is at least A-1 or the equivalent thereof or from Moody’s is at least
P-1 or the equivalent thereof (or carrying an equivalent rating by a nationally
recognized rating agency if both S&P and Moody’s cease publishing ratings
of commercial paper issuers generally) (an “Acceptable Rating”), in each case
with maturities of not more than 364 days from the date of acquisition, (iii) commercial
paper and variable or fixed rate notes carrying an Acceptable Rating and
maturing within twelve months of the date of acquisition, (iv) repurchase
agreements with a bank or trust company (including a Lender) or a recognized
securities dealer having capital and surplus in excess of $500,000,000 for
direct obligations issued by or fully guaranteed by the United States, (v) obligations
of any state of the United States or any political subdivision thereof for the
payment of the principal and redemption price of and interest on which there
shall have been irrevocably deposited Government Obligations maturing as to
principal and interest at times and in amounts sufficient to provide such
payment, (vi) auction preferred stock rated in the highest short-term
credit rating category by S&P or Moody’s and (vii) Dollar denominated
time and demand deposit accounts or money market accounts with those domestic
banks meeting the requirements of item (y) or (z) of clause (ii) above
and any other domestic commercial banks where such accounts are insured by the
FDIC consistent with the FDIC’s ordinary and customary practices.

 

Casualty Event.
With respect to any property (including any interest in property) of either
Borrower, any Guarantor or any of their respective Subsidiaries, any loss of,
damage to, or condemnation or other taking of, such property for which such
Person receives insurance proceeds, proceeds of a condemnation award or other
compensation.

 

Centerline Group.  Consists of CHC and each of its direct and
indirect Subsidiaries.

 

Change in Control.  The occurrence of any of the following:

 

(a)           the occurrence of any events or
circumstances such that any of CCG, any of the Guarantors or any
of the Pledged Entities, 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) 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 

 

5

 

majority of total voting power of the aggregate outstanding common
shares of CHC normally entitled to vote in the election of directors of CHC; or
(iii) during any period of 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

 

(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, similar to such rights arising under
the EIT Preferred Shares, the exercise of any such rights resulting in any such
forced changes.

 

CHC’s Filings.  Forms 10-Q and 10-K filed from time to time
by CHC with the SEC.

 

Closing Date.
The first date on which the conditions set forth in Section 7 have
been satisfied, or waived in accordance with Section 23.

 

Closing Fees.
See Section 6.1.2.

 

Code. The
Internal Revenue Code of 1986, as amended.

 

Collateral. 
Collectively, the Equity Collateral, the Cash Collateral and the
Designated Assets Collateral.

 

Commitment.  With
respect to each Lender, (a) the aggregate Dollar amount set forth on Schedule
2 equal to the sum of (i) such Lender’s Revolving Loan Commitment
(including such Lender’s commitment to participate in the issuance, extension,
renewal and honoring of Letters of Credit issued for the account of either of
the Borrowers), plus (ii) such Lender’s Term Loan Commitment; or (b) if
such Lender’s Revolving Loan Commitment and Term Loan Commitment are terminated
pursuant to the provisions hereof, zero. 
With respect to the Swingline Lender, the Swingline Commitment.

 

Commitment Percentage. With respect to each Lender, the percentage set forth on Schedule
2 obtained by dividing (i) the sum of such Lender’s Revolving Loan
Commitment and Term Loan Commitment, by (ii) the aggregate Commitments of
all Lenders.

 

Competitors.  Persons that are, in CHC’s reasonable
discretion, in competition with the Borrowers; provided, however,
that in no event shall any bank or banking subsidiary of a bank be deemed to be
a Competitor.

 

Compliance Certificate.  See Section 9.5.1(c).

 

Consolidated
or consolidated. With reference to any term defined herein, shall mean
that term as applied to the accounts of the named Person and its Subsidiaries,
consolidated in accordance with GAAP.

 

6

 

Consolidated EBITDA.  With respect to any Person for any period,
the sum (without duplication) of (a) Consolidated Net Income; plus (b) in
each case to the extent deducted in determining Consolidated Net Income, (i) consolidated
interest expense on Funded Debt and on the Term Loan, (ii) the Unused
Facility Fee and any other unused facility fees on Funded Debt, (iii) preferred
dividends paid, accrued or allocated to the 4.4% Convertible CRA Shares, (iv) preferred
dividends paid, accrued or allocated to other preferred Capital Stock (other
than Distributions permitted and contemplated by Section 10.7.3), (v) all
federal, state, local and foreign income tax expense, (vi) depreciation,
depletion, and amortization expense (including mortgage servicing rights) and
other similar non-cash items, (vii) losses related to mortgage servicing
rights, (viii) income allocated to minority interests related to SCU’s,
SCI’s and SMU’s (viii) non-cash compensation, (ix) non-cash
impairments of non-working capital assets, including intangibles, (x) non-recurring
net losses from the sale or other disposition of assets permitted under this
Credit Agreement or outside the ordinary course of business, (xi) non-cash
losses associated with the change in fair market value of derivatives and (xii)
other non-recurring losses; minus (c) in each case to the extent added in
determining Consolidated Net Income, (i) all federal, state, local and
foreign income tax benefits, (ii) non-cash gains related to sales of
mortgage loans, (iii) losses allocated to minority interests related to
SCU’s, SCI’s and SMU’s (iv) non-cash recoveries of non-working capital
assets, including intangibles, (v) non-recurring net gains from the sale
or other disposition of assets permitted under this Credit Agreement or outside
the ordinary course of business, (vi) non-cash gains associated with the
change in fair market value of derivatives and (vii) other non-recurring
gains; all as determined in accordance with GAAP.

 

Consolidated
EBITDA Covenant.  See Section 9.18.1.

 

Consolidated Net Income.  With respect to any Person for
any period of calculation, the net income (or loss) of the Person with respect
to which Consolidated Net Income is being calculated (the “Target Person”) and
its Subsidiaries on a consolidated basis; provided that Consolidated Net
Income shall exclude (a) the undistributed earnings of any Subsidiary to
the extent that the declaration or payment of dividends or similar
distributions by such Subsidiary of such amounts are not permitted by operation
of the terms of its organizational documents or any agreement, instrument or
Applicable Law applicable to such Subsidiary, (b) the income (or loss) of
any Person accrued prior to the date it becomes a Subsidiary or prior to the
date any such Person is merged into or consolidated with the Target Person or
any of its Subsidiaries or that Person’s assets are acquired by the Target
Person or any of its Subsidiaries, and (c) any income (or loss) for such
Period of any Person if such Person is not a Subsidiary, except that the Target
Person’s equity in the net income of any such Person shall be included in
Consolidated Net Income up to the aggregate amount of cash actually distributed
by such Person during such Period to the Target Person or a Subsidiary as a
dividend or other distribution (and in the case of a dividend or other
distribution to a Subsidiary, such Subsidiary is not precluded from further
distributing such amount to the Target Person as described in clause (a) of
this proviso), in each case as determined in accordance with GAAP.

 

Continue,
Continuation and Continued. 
Refers to the continuation of a Base Rate Loan or a LIBOR Rate Loan from
one Interest Period to another Interest Period pursuant to Section 2.3.2.

 

7

 

Contractual
Obligations. For any Person, any provision of any
security issued by that Person or of any material indenture, mortgage, deed of
trust, contract, undertaking, agreement, or other instrument to which such
Person is a party or by which it or any of its assets or properties is bound or
to which it or any of its assets or properties is subject.

 

Conversion Request. A notice given by the Borrowers to the Administrative Agent of the
Borrower’s election to Convert or Continue a Base Rate Loan to a LIBOR Rate
Loan, or vice versa, in accordance with Sections 2.3.1 and 2.3.2.

 

Convert,
Conversion and Converted. Refers to the conversion of either a
Base Rate Loan into a LIBOR Rate Loan or a LIBOR Rate Loan into a Base Rate
Loan pursuant to Sections 2.3.1 and 2.3.2.

 

Covered Taxes.  See Section 6.3.1.

 

Credit Agreement.
See the introductory paragraph to this Credit Agreement.

 

Credit Enhancer.  A credit enhancer, other than Freddie Mac, in
a Future Bond Transaction that satisfies one of the following criteria: any
finance company or financial institution, any insurance company, or any other
Person, of recognized standing in the business of providing credit enhancement
in securitizations, (i) having capital and surplus in excess of
$500,000,000; or (ii) whose short-term commercial paper rating carries an
Acceptable Rating with maturities of not more than 364 days from the date of
acquisition.

 

Creditor Parties.  The Lenders, the Swingline Lender, the
Administrative Agent and the Issuing Bank, or such group of such Persons as a
context may suggest or require.

 

Daily Unused Amount.  See Section 2.1.3(d).

 

Default.  Any event or circumstance which is either an
Event of Default, or, with the giving of notice or the passage of time or both,
will become an Event of Default.

 

Default Rate.
An interest rate equal to (a) the Base Rate plus (b) 2% per
annum, in all cases to the fullest extent permitted by applicable laws.

 

Deferred Fee Agreement.  Collectively, those certain
agreements to be entered into between the Borrowers and certain of their
investment bankers in connection with the Bond Transaction, the terms of which
will be consistent with the terms of this Agreement.

 

Deferred Fees.  Those certain investment banking fees in the
aggregate amount of $35,000,000  accrued through the date hereof in connection with the
consummation of the Bond Transaction that remain unpaid as of the date hereof,
as evidenced by the Deferred Fee Agreement.

 

Delinquent Lender.  See Section 13.5.3.

 

Derivative Agreement. Any forward contract, futures contract, swap, option or other similar
agreement or arrangement (including, without limitation, caps, floors, collars
and similar agreements).

 

Designated Assets.  Those assets identified on Schedule
4.2.2.

 

8

 

Designated Assets Collateral.  Those assets identified in Sections
1(i), (ii) and 3 of Schedule 4.2.2.; provided, however,
that the assets identified in clause (ii) of Section 2
of Schedule 4.2.2 shall constitute Designated Assets Collateral only
from and after such time as CHC directly or indirectly owns all of the Capital
Stock of Blizzard.

 

Distribution.
The declaration or payment of any dividend on or in respect of any shares of
any class of Capital Stock of CHC or any Subsidiary of CHC, including, without
limitation, on account of and pursuant to SCI’s, SCU’s and SMU’s, other than
dividends payable solely in shares of common stock of CHC or such Subsidiary;
the payment or prepayment of principal of, premium, if any, or interest on, or
purchase, redemption, defeasance, retirement or other acquisition of or with
respect to any shares of any class of Capital Stock of CHC or any Subsidiary of
CHC, directly or indirectly through a Subsidiary of such Person or otherwise
(including the setting apart of assets for a sinking or other analogous fund to
be used for such purpose); the return of capital by CHC or any Subsidiary of
CHC to its shareholders as such; or any other distribution on or in respect of
any shares of any class of Capital Stock of CHC or any Subsidiary of CHC.

 

Dollars or $.
Dollars in lawful currency of the United States.

 

Domestic Lending Office.  Initially, the office of each
Lender designated as such by notice to the Borrowers; thereafter, such other
office of such Lender, if any, that shall be making or maintaining Base Rate
Loans.

 

Drawdown Date.  The date on which any Revolving Loan is made
or is to be made, the date on which the Term Loan or any portion thereof is
made, and the date on which any Revolving Loan or Term Loan, in accordance with
Section 2.3, is Converted or Continued.

 

EIT Agreement.  The Amended and Restated Trust Agreement
dated as of June 29, 2000, as amended from time to time, by and among the
managing trustees party thereto, CHC, Wilmington Trust Company, as registered
trustee, and Related Charter, L.P., as manager relating to EIT.

 

EIT Common
Shares.  The
common shares of EIT, and any securities into or for which such common shares
hereafter may be converted or exchanged, constituting all Capital Stock of EIT
other than the EIT Preferred Shares.

 

EIT Preferred
Shares.  Series A,
Series A-1, Series A-2, Series A-3, Series B, Series B-1,
Series B-2, Series A-4-1, Series A-4-2, Series B-3-1, and Series B-3-2
preferred shares issued by EIT, and any other “preferred shares” issued by EIT
after the date hereof in accordance with, and as defined in, the EIT Agreement.

 

Eligible
Assignee.  Any
Person who is: (i) a Lender, any Affiliate of a Lender or any Approved
Fund with respect to such Lender; and (ii) any other financial institution
approved by the Administrative Agent and, with respect to the Revolving Loan
Commitments and so long as no Event of Default is outstanding, the
Borrowers.  In addition to the foregoing,
with respect to the Revolving Loan Commitments, no Lender (with respect to an
increase in such Lender’s Revolving Loan Commitment), no Affiliate of a Lender,
no Approved Fund with respect to such Lender and no other financial institution
shall be an Eligible Assignee without the prior approval 

 

9

 

of the Issuing
Bank and Swingline Lender.  The
Administrative Agent, the Borrowers, the Issuing Bank and the Swingline Bank
acknowledge and agree that their respective approvals provided for in this
definition shall not be unreasonably withheld or delayed, recognizing that it
shall not be unreasonable for the Borrowers to withhold their approval of any
Competitors.

 

Employee Benefit Plan. Any employee benefit plan within the meaning of Section 3(3) of
ERISA established, maintained or contributed to (including any plan to which an
obligation to contribute exists) by the Borrower, any Guarantor or any ERISA Affiliate,
other than a Guaranteed Pension Plan or a Multiemployer Plan.

 

Equity
Collateral.  All
of the Capital Stock in CCG, each of the Guarantors (other than CCC), EIT
(other than the EIT Preferred Shares), ARCap 2004-RR3 Resecuritization, Inc.,
ARCap 2005-RR5 Resecuritization, Inc., SPV I and SPV II, and any other Persons listed on Schedule
1A under paragraph C thereof.

 

ERISA. The
Employee Retirement Income Security Act of 1974 as amended, and regulations
promulgated thereunder.

 

ERISA Affiliate.
Any Person which is treated as a single employer with CHC or any Subsidiary of
CHC under Section 414 of the Code.

 

ERISA Event. 
(i) A “reportable event” within the meaning of Section 4043 of
ERISA and the regulations issued thereunder with respect to any Guaranteed
Pension Plan; (ii) the failure to meet the minimum funding standard of
Code Section 412 with respect to any Guaranteed Pension Plan (whether or
not waived in accordance with Section 412(d) of the Code) or the
failure to make by its due date a required installment under Code Section 412(m) with
respect to any Guaranteed Pension Plan or the failure to make any required
contribution to a Multiemployer Plan; (iii) the provision by the
administrator of any Guaranteed Pension Plan pursuant to Section 4041(a)(2) of
ERISA of a notice of intent to terminate such plan in a distress termination
described in Section 4041(c) of ERISA; (iv) the withdrawal by
any Borrower, Guarantor, Pledged Entity or ERISA Affiliate from any Guaranteed
Pension Plan with two or more contributing sponsors or the termination of any
such plan resulting in liability pursuant to Sections 4063 or 4064 of ERISA; (v) the
institution by the PBGC of proceedings to terminate any Guaranteed Pension
Plan, or the occurrence of any event or condition which might constitute
grounds under ERISA for the termination of, or the appointment of a trustee to
administer, any Guaranteed Pension Plan; (vi) the imposition of liability
on any Borrower, Guarantor, Pledged Entity or ERISA Affiliate pursuant to Section 4062(e) or
4069 of ERISA or by reason of the application of Section 4212(c) of
ERISA; (vii) the withdrawal by any Borrower, Guarantor, Pledged Entity or
any ERISA Affiliate in a complete or partial withdrawal (within the meaning of
Sections 4203 and 4205 of ERISA) from any Multiemployer Plan if there is any
potential liability therefor, or the receipt by any Borrower, Guarantor,
Pledged Entity or any ERISA Affiliate of notice from any Multiemployer Plan
that it is in reorganization or insolvency pursuant to Section 4241 or
4245 of ERISA, or that it intends to terminate or has terminated under Section 4041A
or 4042 of ERISA; (viii) the occurrence of an act or omission that could
give rise to the imposition on any Borrower, Guarantor, Pledged Entity or any ERISA
Affiliate of material fines, penalties, taxes or related charges under the Code
in respect of any Employee Benefit Plan including without limitation, the
occurrence of a prohibited transaction within the meaning of Code Section 4975,
that would have a Material Adverse Effect; (ix) the assertion of a 

 

10

 

material claim (other than routine claims for benefits) against any
Employee Benefit Plan or the assets thereof, or against any Borrower,
Guarantor, Pledged Entity or any ERISA Affiliate in connection with any such
Employee Benefit Plan that would have a Material Adverse Effect; (x) receipt
from the Internal Revenue Service of notice of the failure of any Guaranteed
Pension Plan (or any other Employee Benefit Plan intended to be qualified under
Code Section 401(a)) to qualify under Code Section 401(a), or the
failure of any trust forming part of any Employee Benefit Plan that is an
employee pension benefit plan within the meaning of Section 3(2) of
ERISA to qualify for exemption from taxation under Code Section 501(a); or
(xi) the imposition of a Lien pursuant to Code Section 401(a)(29) or 412(n) or
pursuant to ERISA with respect to any Employee Benefit Plan that is an employee
pension benefit plan within the meaning of Section 3(2) of ERISA.

 

ERISA Reportable Event. A reportable event with respect to a Guaranteed Pension Plan within
the meaning of Section 4043 of ERISA and the regulations promulgated
thereunder, but excluding any event for which the 30 day notice requirement has
been waived by applicable regulations of the PBGC.

 

Event of Default.
See Section 11.1.

 

Excluded Taxes.
With respect to the Administrative Agent, any Lender, the Swingline Lender, the
Issuing Bank or any other recipient of any payment to be made by or on account
of any Obligation of the Borrowers hereunder, (a) taxes imposed on or
measured by its overall net income (however denominated), 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 such recipient is organized or in
which its principal office is located, and (b) any branch profits taxes
imposed by the United States or any similar tax imposed by any other
jurisdiction in which either Borrower is located.

 

Existing Letter of Credit. That letter of credit listed on Schedule 5.

 

Extension Request.  A request made by the
Borrowers as contemplated by Section 2.1.2 to extend the Revolver
Maturity Date.  Any Extension Request
shall be made in writing by the Borrowers to the Administrative Agent no more
than one hundred twenty (120) days and no less than thirty (30) days prior to
the expiration of the original Revolver Maturity Date.

 

FDIC.  The Federal Deposit Insurance Corporation.

 

Fee Letter.
The fee letter, of even date herewith, among the Borrowers and the
Administrative Agent.

 

Fees.
Collectively, the Letter of Credit Fees, the Administrative Agent’s Fee, the
Closing Fees and the Unused Facility Fee.

 

Fiscal Quarter(s). The approximately thirteen (13) or fourteen (14) week periods, the
first of which shall commence on the first day of each Fiscal Year, and the
second, third and fourth of which shall commence on the first day of April, July and
October, respectively.

 

Fiscal Year.
The period commencing on January 1 and ending on December 31 of each
calendar year.

 

11

 

Fixed Charges.  The amount measured as of the last day of the
applicable period derived from (A) interest expense on Funded Debt and
Term Loan that is due and payable during such applicable period, plus (B) the
Unused Facility Fee and any other unused facility fees on Funded Debt, plus (C) scheduled
principal payments of Funded Debt (excluding any amortization payments on the
Term Loan), plus (D) payments made or funds allocated to pay any interest
on the Deferred Fees, plus (E) preferred dividends allocated, accrued or
paid to any 4.4% Convertible CRA Shares, plus (F) preferred dividends
allocated, accrued or paid to any preferred Capital Stock (other than
Distributions permitted and contemplated by Section 10.7.3).

 

4.4%
Convertible CRA Shares.  CHC’s 4.4% Convertible Community Reinvestment
Act Preferred Shares described in CHC’s Filings as filed with the SEC from time
to time, and any and all shares of capital stock of CHC with similar
characteristics and terms, including, without limitation, such shares that
possess different dividend rates.

 

Freddie Mac.  Federal Home Loan Mortgage Corporation, a
shareholder-owned government-sponsored enterprise organized and existing under
the laws of the United States.

 

Fund.  Any Person (other than a natural person) that
is (or will be) engaged in making, purchasing, holding or otherwise investing
in commercial loans and similar extensions of credit in the ordinary course.

 

Funded Debt.  The sum of the outstanding principal of (a) Revolving
Loans plus any (b)Senior Unsecured Indebtedness of the Borrowers, plus (c) Subordinated
Debt of the Borrowers, plus (d) any Risk-Adjusted Contingent Liabilities
which have become payable or are short term GAAP liabilities.

 

Future Bond Transaction.  The
exchange of a portfolio of bonds to Freddie Mac under its so-called TEBS or
similar program for purposes of a securitization of such portfolio that is
credit enhanced by Freddie Mac, or under a similar securitization program with
another Credit Enhancer.

 

GAAP.  Principles that are (i) consistent with
the principles promulgated or adopted by the Financial Accounting Standards
Board and its predecessors and successors, as in effect from time to time, and (ii) consistently
applied with past financial statements of each Borrower, each Guarantor and
their respective Subsidiaries adopting the same principles, provided that in
each case referred to in this definition of “GAAP” a certified public
accountant would, insofar as the use of such accounting principles is
pertinent, be in a position to deliver an unqualified opinion (other than
qualifications regarding changes in GAAP and as to normal year-end adjustments)
as to financial statements in which such principles have been properly applied.

 

Governing Documents. With respect to any Person, its certificate or articles of
incorporation, certificate of formation, certificate of trust, or, as the case
may be, certificate of limited partnership, its by-laws, operating agreement,
trust agreement or, as the case may be, partnership agreement or other
constitutive documents and all shareholder agreements, voting trusts and
similar arrangements applicable to any of its Capital Stock.

 

12

 

Governmental Authority. Any foreign, federal, state, provincial, regional, local municipal or
other government, or any department, commission, board, bureau, agency, public
authority or instrumentality thereof, or any court or arbitrator.

 

Government Obligations.  See the definition of Cash
Equivalents.

 

Guaranteed Pension Plan.  Any employee pension benefit plan within the
meaning of Section 3(2) of ERISA established, maintained, or
contributed to (including any plan to
which an obligation to contribute exists) by either Borrower, any
Guarantor, any Pledged Entity or any ERISA Affiliate, the benefits of which are
guaranteed on termination in full or in part by the PBGC pursuant to Title IV
of ERISA, other than a Multiemployer Plan.

 

Guaranties.  Those Guaranties executed by the Guarantors
on or about the date hereof, or from time to time as contemplated hereby,
substantially in form and content of Exhibit 1.1B, and otherwise in
form and content reasonably satisfactory to the Administrative Agent, pursuant
to which, among other things, each Guarantor jointly, severally and
unconditionally guaranties the payment and performance in full of the
Obligations.

 

Indebtedness.
As to any Person and whether recourse is secured by or is otherwise available
against all or only a portion of the assets of such Person and whether or not
contingent, but without duplication:

 

(a)           every obligation of such Person for money borrowed;

 

(b)           every obligation of such Person evidenced by bonds,
debentures, notes or other similar instruments, including obligations incurred
in connection with the acquisition of property, assets or businesses;

 

(c)           every reimbursement obligation of such Person with respect to
letters of credit, bankers’ acceptances, or similar facilities issued for the
account of such Person;

 

(d)           every obligation of such Person
issued or assumed as the deferred purchase price of property or services (including securities repurchase agreements but
excluding trade accounts payable or accrued liabilities arising in the ordinary
course of business);

 

(e)           every obligation of such Person under
any capitalized lease;

 

(f)            every obligation of such Person under any synthetic lease;

 

(g)           all sales by such Person of (i) accounts
or general intangibles for money due or to become due, (ii) chattel paper,
instruments or documents
creating or evidencing a right to payment of money or (iii) other
receivables (collectively “receivables”), whether pursuant to a purchase
facility or otherwise, other than in connection with the disposition of the
business operations of such Person relating thereto or a disposition of
defaulted receivables for collection and not as a financing arrangement, and
together with any obligation of such Person to pay any discount, interest,
fees, indemnities, penalties, recourse, expenses or other amounts in connection
therewith;

 

13

 

(h)           every obligation of such
Person to purchase, redeem, retire or otherwise acquire for value any shares of Capital Stock issued by such Person or
any rights measured by the value of such Capital Stock;

 

(i)            every obligation of such Person under any Derivative Agreement;

 

(j)            every obligation in respect of
Indebtedness of any other entity (including any partnership in which such
Person is a general partner) to the extent that such Person is liable therefor
as a result of such Person’s ownership interest in or other relationship with
such entity, except to the extent that the terms of such Indebtedness provide
that such Person is not liable therefor and such terms are enforceable under
applicable law; and

 

(k)           every obligation,
contingent or otherwise, of such Person guaranteeing, or having the economic
effect of guarantying or otherwise acting as surety for, any obligation of a
type described in any of clauses (a) through (j) above (the “primary
obligation”) of another Person (the “primary obligor”), in any manner, whether
directly or indirectly, and including, without limitation, any obligation of
such Person (i) to purchase or pay (or advance or supply funds for the
purchase of) any security for the payment of such primary obligation, (ii) to
purchase property, securities or services for the purpose of assuring the
payment of such primary obligation, or (iii) to maintain working capital,
equity capital or other financial statement condition or liquidity of the
primary obligor so as to enable the primary obligor to pay such primary
obligation.

 

The “amount” or “principal amount” of any Indebtedness at any time of
determination represented by (1) any Indebtedness, issued at a price that
is less than the principal amount at maturity thereof, shall be the amount of
the liability in respect thereof determined in accordance with GAAP, (2) any
capitalized lease shall be the present value of the aggregate of the rentals
obligation under such capitalized lease payable over the term thereof that is
not subject to termination by the lessee, (3) any sale of receivables
shall be the amount of unrecovered capital or principal investment of the
purchaser (other than CHC or any of its wholly-owned Subsidiaries) thereof,
excluding amounts representative of yield or interest earned on such
investment, (4) any synthetic lease shall be the stipulated loss value,
termination value or other equivalent amounts, (5) any derivative contract
shall be the maximum amount of any termination or loss payment required to be
paid by such Person if such derivative contract were, at the time of
determination, to be terminated by reason of any event of default or early
termination event thereunder, whether or not such event of default or early
termination event has in fact occurred, (6) any equity related purchase
obligation shall be the maximum fixed redemption or purchase price thereof
inclusive of any accrued and unpaid dividends to be comprised in such
redemption or purchase price and (7) any guaranty or other contingent
liability referred to in clause (k) above shall be an amount equal to the
stated or determinable amount of the primary obligation in respect of which
such guaranty or other contingent obligation is made or, if not stated or
determinable, the maximum reasonably anticipated liability in respect thereof
(assuming such Person is required to perform thereunder) as determined by such
Person in good faith.

 

14

Information.  See Section 25.2.

 

Intercompany Subordination Agreement.  That certain Subordination Agreement, dated
as of the date hereof, among the Borrowers, the Guarantors, the Pledged
Entities, the subordinating creditors and the Administrative Agent, which
provides, inter  alia, that all Indebtedness owing to another
Borrower, Guarantor or Pledged Entity shall be subordinated to the full and
final payment of the Obligations.

 

Interest Payment Date.
(a) With respect to any outstanding Revolving Loans and, with respect to
clause (a)(i) below, Swingline Loans (i) as to any Base Rate Loan,
the first Business Day of each calendar month (including the month immediately
following the month which includes the Drawdown Date thereof) and the Revolver
Maturity Date, and (ii) as to any LIBOR Rate Loan, the last day of each
Interest Period applicable to such Loan, the Revolver Maturity Date; and (b) with
respect to the outstanding Term Loan (i) as to any Base Rate Loan, the
first Business Day of each calendar month (including the month immediately
following the month which includes the Drawdown Date thereof), the Term Loan
Maturity Date and any date on which any portion of the principal outstanding of
the Term Loan is prepaid, and (ii) as to any LIBOR Rate Loan, the last day
of each Interest Period applicable to such Loan, the Term Loan Maturity Date
and any date on which any portion of the principal outstanding of the Term Loan
is prepaid; provided, however, that, with respect to any portion
of the Revolving Loans or the Term Loan, if any Interest Period for a LIBOR
Rate Loan exceeds three (3) months, the respective dates that fall every
three months after the beginning of such Interest Period shall also be Interest
Payment Dates.

 

Interest Period.
With respect to all or any relevant portion of each Revolving Loan or the Term
Loan, (a) initially, the period commencing on the Drawdown Date of such
Loan and ending on the last day of one of the periods set forth below, as
selected by the Borrowers in a Loan Request or as otherwise required by the
terms of this Credit Agreement (i) for any Base Rate Loan, each Business
Day, and (ii) for any LIBOR Rate Loan 1, 2, 3, or 6 months, and if
available to all Revolving Credit Lenders or Term Loan Lenders as the case may
be, 12 months, and (b) thereafter, each period commencing on the last day
of the next preceding Interest Period applicable to such Loan or portion
thereof and ending on the last day of one of the periods set forth above, as
selected by the Borrowers in a Conversion Request; provided that all of
the foregoing provisions relating to Interest Periods are subject to the
following:

 

(a)           if any Interest Period with respect
to a LIBOR Rate Loan would otherwise end on a day that is not a Business Day,
that Interest Period
shall be extended to the next succeeding Business Day unless the result of such
extension would be to carry such Interest Period into another calendar month,
in which event such Interest Period shall end on the immediately preceding
Business Day;

 

(b)           if the Borrowers fail to give notice as provided in Section 2.3, the
Borrowers shall be deemed to have requested a conversion of the affected LIBOR
Rate Loan to a Base Rate Loan and the continuance of all Base Rate Loans as
Base Rate Loans on the last day of the then current Interest Period with
respect thereto;

 

(c)           any Interest Period relating to any
LIBOR Rate Loan that begins on the last Business Day of a calendar month (or on
a day for which there is no numerically corresponding day in the calendar month
at the end of such Interest Period) shall end on the last Business Day of a
calendar month; and

 

15

 

(d)           any Interest Period relating to any
LIBOR Rate Loan that would otherwise extend beyond the applicable Maturity Date
shall end on such Maturity Date.

 

Issuing Bank.  See the introductory paragraph to this Credit
Agreement.

 

LC Guaranty.  See Section 5.1.1.

 

Lender or Lenders.
See the introductory paragraph to this Credit Agreement.  Such term shall also include any Person that
becomes a Lender by way of assignment or transfer pursuant to this Credit
Agreement.

 

Letter of Credit.  Any standby or documentary letter of credit
issued pursuant to this Credit Agreement.

 

Letter of Credit Application. See Section 5.1.1.

 

Letter of Credit Fee. See Section 5.6.

 

Letter of Credit Participation.  See Section 5.1.4.

 

LIBOR Business Day. Any day on which commercial banks are open for international business
(including dealings in Dollar deposits) in London.

 

LIBOR Lending Office. Initially, the office of each Lender designated as such by notice to
the Borrower; thereafter, such other office of such Lender, if any, that shall
be making or maintaining LIBOR Rate Loans.

 

LIBOR Rate.  For any Interest Period with respect to a
LIBOR Rate Loan, the rate per annum as determined on the basis of the
offered rates for deposits in Dollars, for a period of time comparable to such
LIBOR Rate Loan which is equal to the
British Bankers Association LIBOR Rate (“BBA LIBOR”), as published by Reuters
(or other commercially available source providing quotations of BBA LIBOR as
designated by the Administrative Agent from time to time) (collectively, the “Reuters
System”) as of 11:00 a.m. London time on the day that is two (2) LIBOR
Business Days preceding the first day of the Interest Period applicable to such
LIBOR Rate Loan; provided, however, if
the rate described above does not appear on the Reuters System on any
applicable interest determination date, the LIBOR Rate shall be the rate
(rounded upward if necessary, to the nearest one hundred-thousandth of a
percentage point), determined on the basis of the offered rates for deposits in
Dollars for a period of time comparable to such LIBOR Rate Loan which are
offered by four major banks in the London interbank market at approximately
11:00 a.m. London time, on the date that is two (2) LIBOR Business
Days preceding the first day of such Interest Period as selected by the
Administrative Agent.  The principal
London office of each of the four major London banks will be requested to
provide a quotation of its Dollar deposit offered rate.  If at least two (2) such quotations are
provided, the rate for that date will be the arithmetic mean of the
quotations.  If fewer than two (2) quotations
are provided as requested, the rate for that date will be determined on the
basis of the rates quoted for loans in Dollars to leading European banks for a
period of time comparable to such Interest Period offered by major banks in New
York City at approximately 11:00 a.m. Boston time, on the day that is two (2) LIBOR
Business Days preceding the first day of such LIBOR Rate Loan.  In the event that the Administrative Agent is
unable to obtain any such 

 

16

 

quotation as provided above, it will be
deemed that the LIBOR Rate pursuant to a LIBOR Rate Loan cannot be
determined.  In the event that the Board
of Governors of the Federal Reserve System shall impose a Reserve Percentage
with respect to LIBOR Rate deposits of any Lender, then for any period during
which such Reserve Percentage shall apply, the LIBOR Rate shall be equal to the
amount determined above divided by an amount equal to 1 minus the Reserve
Percentage.

 

LIBOR Rate Loans.
All or any portion of the Revolving Loans or the Term Loan bearing interest
calculated by reference to the LIBOR Rate.

 

Liens. Any
encumbrance, mortgage, deed of trust, assignment, attachment, deposit
arrangement, lien (statutory, judgment or otherwise), pledge, hypothecation,
charge, restriction or other security interest, security agreement, or any
interest of any kind securing any obligation of any entity or person, whether
such interest is based on common law, civil law, statute or contract.

 

Loan Documents.
This Credit Agreement, any Notes, the Letter of Credit Applications, the
Letters of Credit, the Guaranties, the Pledge Agreements, the Fee Letter and
any other agreement between or among a Borrower and/or any Guarantor and the
Administrative Agent and/or any Lender relating to fee arrangements, or any
other agreement, instrument or writing between or among such parties pursuant
to, ancillary to or contemplated by this Credit Agreement.

 

Loan Request.  A Revolving Loan Request or a Swingline Loan
Request.

 

Loans.
Collectively, the Revolving Loans, the Swingline Loans and the Term Loan.

 

Material Adverse Effect.  A material adverse effect on (i) the
properties, assets, financial condition, operations or business of each of the
Borrowers and Guarantors, and their Subsidiaries, taken as a whole, (ii) the
ability of either Borrower or any Guarantor to fully and timely pay or perform
its obligations under the Loan Documents, (iii) the legality, validity,
binding effect or enforceability against either Borrower or any Guarantor of a
Loan Document to which it is a party, or (iv) the rights, remedies and
benefits available to, or conferred upon, the Administrative Agent or any other
Creditor Party under any Loan Document.

 

Maturity Dates.
Collectively, the Revolver Maturity Date and the Term Loan Maturity
Date.

 

Maximum Drawing Amount. The maximum aggregate amount that the beneficiaries may at any time
draw under outstanding Letters of Credit issued for the account of a Borrower,
as such aggregate amount may be reduced from time to time by draws under such
Letters of Credit or otherwise pursuant to the terms of such Letters of Credit.

 

Moody’s.  Moody’s Investors Service, Inc. and its
successors.

 

Multiemployer Plan. Any multiemployer plan within the meaning of Section 3(37) of
ERISA maintained or contributed to by either Borrower, any Guarantor or any
ERISA Affiliate.

 

Necktie Loans.  Those certain revolving and term loans
advanced to the Borrowers pursuant to that certain Amended and Restated
Revolving Credit and Term Loan Agreement, dated as of August 24, 2006,
among the Borrowers, the Guarantors, certain lenders and other parties thereto.

 

17

 

Negative Covenants and Financial Covenants.  The covenants of the Borrowers and the
Guarantors set forth in Section 10.

 

Net Proceeds.  All cash or other assets actually received by
CHC as a result of the sale of Capital Stock in CHC or any Subsidiary of CHC
(as determined in accordance with GAAP, subject to such adjustments as may be
agreed upon by the Borrowers and the Administrative Agent), minus (A) customary
and reasonable costs and discounts of issuance paid by CHC or such issuing
Subsidiary, as the case may be, and minus (B) proceeds of such sales that
are applied within 30 days of issuance to retire similar equity instruments.

 

New Lending Office.  See Section 6.3.4.

 

Non-U.S. Lender.  See Section 6.3.4.

 

Notes.  Any Revolving Notes and any Term Notes as a
Lender may request from time to time pursuant to Section 2.1.4 or Section 2.2.2,
as the case may be.

 

Obligations.
All indebtedness, obligations and liabilities of the Borrowers, any of the
Guarantors and their respective Subsidiaries to any of the Lenders, the
Swingline Lender, the Issuing Bank, the Administrative Agent or any of their
Affiliates, individually or collectively, existing on the date of this Credit
Agreement or arising thereafter, direct or indirect, joint or several, absolute
or contingent, matured or unmatured, liquidated or unliquidated, secured or
unsecured, arising by contract, operation of law or otherwise, arising or
incurred under this Credit Agreement or any of the other Loan Documents or any
Derivative Agreement or in respect of any of the Loans made, or any obligations
under Derivative Agreements or Reimbursement Obligations incurred or any of the
Letter of Credit Applications, Letters of Credit or other instruments at any
time evidencing any thereof.

 

Other Taxes.  See Section 6.3.2.

 

Outstanding
or outstanding. With respect to the Loans, the aggregate unpaid
principal thereof as of any date of determination.

 

Participant.  See Section 17.4.

 

PBGC. The
Pension Benefit Guaranty Corporation created by Section 4002 of ERISA and
any successor entity or entities having similar responsibilities.

 

Permitted Businesses.  See Section 10.12.

 

Permitted Indebtedness.  See Section 10.3.

 

Permitted Liens.
See Section 10.1.

 

Person.  Any natural person, corporation,
limited liability company, trust, joint venture, association, company,
partnership, Governmental Authority or other entity.

 

Platform.  See Section 25.4.

 

Pledge
Agreements. The Pledge Agreements to be executed by
each of the holders of Equity Collateral, on or about the date hereof, or from
time to time as contemplated hereby, 

 

18

 

substantially
in form and content of Exhibit 1.1C, and otherwise in form and
content satisfactory to the Administrative Agent, pursuant to which, among
other things, such entities shall pledge and assign to the Administrative
Agent, on behalf and for the pro rata benefit of the Creditor Parties, a first
priority security interest in, all of such entities’ right, title and interest
in and to the Capital Stock of the Person whose Capital Stock constitutes
Equity Collateral.

 

Public Lender.  See Section 25.4.

 

Register. See
Section 17.3.

 

Regulation D.  Regulation D of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor or
other regulation or official interpretation of said Board of Governors relating
to reserve requirements applicable to member banks of the Federal Reserve
System.

 

Reimbursement Obligation. See Section 5.2.

 

Related Parties.
With respect to any specified Person, such Person’s Affiliates and the
respective equityholders, directors, trustees, officers, employees, agents,
attorneys, representatives and advisors of such Person and such Person’s
Affiliates.

 

Required Lenders.  Until such time as the Term Loan and all
Obligations relating directly thereto or arising therefrom have been fully
paid, any Lender or combination of two or more Lenders holding at least 75% of
the sum of all Term Loans outstanding, all Revolving Exposure, unused Revolving
Loan Commitments and unused Term Loan Commitments (as such Commitments are
reflected on Schedule 2 and as such Commitments may be reduced from time
to time pursuant to Section 2.5). 
From and after such time as the Term Loan and all Obligations relating
directly thereto or arising therefrom have been fully paid, Required Lenders
shall mean any Lender or combination of two or more Lenders holding at least
66.67% of the sum of all Revolving Exposure and unused Revolving Loan
Commitments.

 

Reserve Percentage.  The maximum aggregate reserve
requirement (including all basic, supplemental, marginal and other reserves)
which is imposed on member banks of the Federal Reserve System against “Eurocurrency
Liabilities” as defined in Regulation D.

 

Reuters System.  See the definition of LIBOR Rate.

 

Revolver Maturity Date.  June 26, 2009,  subject to extension under Section 2.1.2,
and acceleration under Section 11.2.1.

 

Revolving Credit Lender.  Each Lender whose Revolving Loan Commitment
and Revolving Loan Commitment Percentage is greater than zero.

 

Revolving Credit Limit.  The aggregate of all
Revolving Loan Commitments from time to time under this Agreement, as may be reduced from time to time pursuant
to this definition, Section 2.5, Section 3.1.3, Section 4.2.3
or Section 10.3.1(j). As of the date hereof, the Revolving
Credit Limit equals $225,000,000.  Notwithstanding the foregoing,
following the date hereof, and prior to March 31, 2009, the Revolving
Credit Limit may be increased from time to time up to an amount not to exceed
$300,000,000 by Revolving Credit Lenders increasing their respective 

 

19

 

Revolving Loan Commitments, or by Eligible
Assignees making Revolving Loan Commitments, by executing and delivering a
joinder to this Agreement.  In the event
that the Revolving Credit Limit exceeds $275,000,000 on March 31, 2009,
the Revolving Credit Limit shall be reduced to $275,000,000 on March 31,
2009, and the Revolving Loan Commitment of each Revolving Lender shall be
reduced proportionately to reflect such reduction.  Promptly upon the execution and delivery of
any such joinders, or in the event of any such reduction, the Administrative
Agent will provide written notice to the Borrowers, the Guarantors and the
Lenders of the increases or decrease, respectively, in the Revolving Credit
Limit and the Total Credit Amount then occurring.  From time to time as the Administrative Agent
provides notice of an existing or new Lender undertaking an additional or new
Revolving Loan Commitment, or in the event of any such decrease, the
Administrative Agent will also provide a revised Schedule 2 pursuant to Section 17.3
reflecting the updated Revolving Loan Commitments and the then applicable
Revolving Credit Limit.

 

Revolving Exposure. At any time, the sum of
the outstanding amount of all Revolving Loans, plus the outstanding amount of
all Swingline Loans, plus the Maximum Drawing Amount, plus, without
duplication, all Unpaid Reimbursement Obligations.

 

Revolving Loan Account.  See Section 17.3.

 

Revolving Loan Commitment.  As to any Revolving
Credit Lender, the obligation of such Lender, if any, to make Revolving Loans
and participate in Swingline Loans and Letters of Credit in an aggregate
principal and/or face amount not to exceed the amount set forth under the
heading Revolving Loan Commitment opposite such Lender’s name on Schedule 2
or in the Assignment and Acceptance pursuant to which such Lender became a
party hereto, as the same may be (a) reduced from time to time pursuant to
Section 2.5, or (b) reduced or increased from time to time
pursuant to assignments by or to such Lender pursuant to Section 17.2.

 

Revolving Loan Commitment Percentage.  With
respect to each Revolving Credit Lender, the percentage set forth opposite its
name on Schedule 2.

 

Revolving Loan Request.  See Section 2.1.6(a).

 

Revolving Loans.
The revolving credit loans made by the Revolving Credit Lenders to the
Borrowers pursuant to Section 2.1.

 

Revolving Note.
See Section 2.1.4.

 

Risk-Adjusted Contingent Liabilities.  Any
guaranties or other indirect contingent Indebtedness with respect to which a
risk-adjusted category has been determined, and with the aggregate amount
thereof with respect to Risk-Adjusted Contingent Liabilities of CHC or CCG to
be based upon the risk classifications and the risk factor weightings
associated therewith as set forth on Exhibit 1.1D.  Any potential liabilities arising from
matters not clearly attributable to an existing risk category shall be assigned
an initial risk-rating by the Administrative Agent in its sole discretion, and
upon such assignment Exhibit 1.1D may be revised unilaterally by the
Administrative Agent in order to reflect such new risk category.

 

S&P.  Standard & Poor’s Rating Services, a
division of The McGraw-Hill Companies, Inc.

 

20

 

SCI’s.  Special Common Interests issued by Centerline
Investors entitling the holders thereof to a Preferred Return (as defined in
Centerline Investors’ Second Amended and Restated Limited Liability Company
Agreement dated as of August 15, 2006, as amended).

 

SCU’s.  Special Common Units issued by CCC entitling
the holders thereof to a Preferred Return (as defined in CCC’s Amended and
Restated Operating Agreement dated November 17, 2003, as amended).

 

SEC.  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.

 

Senior Unsecured Indebtedness.  Recourse indebtedness for borrowed money that
is not secured by any of the Borrowers’ or any of their Subsidiaries’ assets,
and that is not Subordinated Debt. 
Senior Unsecured Indebtedness shall include the Deferred Fees and the
Unfunded Escrow.  Notwithstanding the
foregoing, Senior Unsecured Indebtedness shall not include any indebtedness
reflected on the balance sheet of a Person as required by GAAP that arises from
deferred fees or other deferred revenues associated with providing guaranties.

 

SMU’s.  Special Membership Units issued by CM
Investor LLC entitling the holders thereof to a Preferred Return (as defined in
CM Investor LLC’s Second Amended and Restated Limited Liability Company
Agreement dated as of August 9, 2005, as amended).

 

Solvent.  A Person is Solvent if the present fair
saleable value of such Person’s assets is greater than the amount that will be
required to pay such Person’s probable liability on its existing debts as they
become absolute and matured.

 

Stabilization Escrow Agreement.  That certain
Stabilization Escrow and Security Agreement dated as of December 1, 2007,
between Freddie Mac and SPV II.

 

Subordinated Debt.  Any of the Borrowers’
Indebtedness for borrowed money subordinated to the payment and performance of
the Obligations upon terms and conditions reasonably acceptable to the
Administrative Agent.  Such
Indebtedness will be acceptable to the Administrative Agent, and therefore will
constitute Subordinated Debt, if such Indebtedness provides for the
following:  (a) such Indebtedness is
not secured by any interest in the Collateral; (b) payments with respect
to such Indebtedness is prohibited during the existence of either or both of (i) a
Default in any Obligation requiring the payment of money or (ii) any Event
of Default, and (c) the holder of such Indebtedness shall have agreed, for
the benefit of the Lenders, to refrain from pursuing any rights or remedies
with respect to such Indebtedness or with respect to any collateral or security
therefor until such time as the Obligations have been fully and indefeasibly
paid and performed.

 

Subsidiary. Any
corporation, association, trust, partnership, limited liability company or
other business entity of which the designated parent shall at any time own
directly or indirectly through a Subsidiary or Subsidiaries at least a majority
(by number of votes) of the outstanding Voting Stock.

 

Swingline Commitment.  See Section 2.4.1.

 

21

 

Swingline Lender.  Bank of America, in its capacity as Lender of
Swingline Loans hereunder or any successor.

 

Swingline Loan.   Any loan made by the Swingline Lender
pursuant to Section 2.4.

 

Swingline Loan Request. 
See Section 2.4.2.

 

Target Person.  See the definition of Consolidated Net
Income.

 

Taxes. All
present or future taxes, levies, imposts, duties, deductions, withholdings,
assessments, fees or other charges imposed by any Governmental Authority,
including any interest, additions to tax or penalties applicable thereto.

 

Term Loan.
The term loan advanced by the Term Loan Lenders to the Borrowers pursuant to Section 2.2.

 

Term Loan Account.  See Section 17.3.

 

Term Loan Commitment.  As to each Term Loan
Lender, the commitment of such Lender to make any portion of the Term Loan
hereunder as set forth on Schedule 2, or in the Assignment and
Acceptance pursuant to which such Lender assumed its Term Loan Commitment, as
applicable, as the same may be (a) reduced from time to time pursuant to Section 2.5,
or (b) reduced or increased from time to time pursuant to assignments by
or to such Lender pursuant to Section 17.2.

 

Term Loan Commitment Percentage.  With
respect to each Term Loan Lender, the percentage set forth opposite its name on
Schedule 2.

 

Term Loan Lender.  Each Lender whose Term Loan Commitment and
Term Loan Commitment Percentage is greater than zero.

 

Term Loan Limit.  The aggregate of all Term Loan
Commitments from time to time under this Agreement, as may be reduced from time to time pursuant to Section 2.5
or Section 4.2. As of the date hereof, the Term Loan Limit
equals $140,000,000.  Notwithstanding the foregoing,
following the date hereof the Term Loan Limit may be increased from time to
time up to an amount not to exceed $150,000,000 by Term Loan Lenders increasing
their respective Term Loan Commitments, or by Eligible Assignees making Term
Loan Commitments, by executing and delivering a joinder to this Agreement.  Promptly upon the execution and delivery of
any such joinders, the Administrative Agent will provide written notice to the
Borrowers, the Guarantors and the Lenders of the increases in the Term Loan
Limit and the Total Credit Amount evidenced by such joinders.  From time to time as the Administrative Agent
provides notice of an existing or new Lender undertaking an additional or new
Term Loan Commitment, the Administrative Agent will also provide a revised Schedule
2 pursuant to Section 17.3 reflecting the updated Term Loan
Commitments and the then applicable Term Loan Limit.

 

Term Loan Maturity Date.  December 26, 2008,
subject to acceleration under Section 11.2.1.

 

Term Note.
See Section 2.2.2.

 

22

 

The Related Companies.  The Related Companies, L.P., a
New York limited partnership.

 

The Related Companies Group. Consists of The Related Companies and all of its Affiliates other
than the Centerline Group.

 

Total Commitment.
The sum of the Commitments of the Lenders, as in effect from time to time.

 

Total Credit Amount.  The aggregate of the Revolving
Credit Limit and the Term Loan Limit, from time to time.  As of the date hereof, the Total Credit Limit
equals $365,000,000.  The Total Credit
Amount is subject to increase pursuant to the definitions of Revolving Credit
Limit and Term Loan Limit, and is subject to decrease pursuant to Section 2.5,
Section 3.1.3, Section 4.2.3, or Section 10.3.1(j).

 

Type. As to
all or any portion of any Revolving Loan or the Term Loan, its nature as a Base
Rate Loan or LIBOR Rate Loan.  All
Swingline Loans shall be Base Rate Loans.

 

Unfunded Escrow.  The portion of the Bond Stabilization Escrow
Account that remains unfunded pursuant to the Stabilization Escrow Agreement,
such unfunded portion being in the amount of $50,025,216.20 on the date hereof.

 

Uniform Customs.  See Section 5.1.3.

 

United States.  United States of America.

 

Unpaid Reimbursement Obligation. The Reimbursement Obligations for which the
Borrowers do not reimburse the Administrative Agent and the Lenders on the date
specified in, and in accordance with, Section 5.2.

 

Unused Facility Fee.  See Section 2.1.3.

 

Valid Business Impediment.  With respect to any Person whose Consolidated EBITDA is required in
order to satisfy the Consolidated
EBITDA Covenant, any (a) valid legal prohibition, (b) contractual
impediment required for the ongoing profitable operation of such Person, or (c) circumstance
in which a consent cannot be obtained after reasonable effort, that would
prevent such Person from providing a Guaranty, as reasonably determined by the
Administrative Agent from time to time.

 

Voting Stock.  Capital Stock of any class or classes
(however designated), the holders of which are at the time entitled, as such
holders, to vote for the election of the directors (or persons performing
similar functions) of the corporation, association, trust, partnership, limited
liability company or other business entity involved, whether or not the right
so to vote exists by reason of the happening of a contingency.

 

1.2         Rules of Interpretation.

 

(a)           Unless
otherwise expressly indicated, a reference to any document or agreement shall
include such document or agreement as amended, modified, restated or
supplemented from time to time in accordance with its terms and the terms of
this Credit Agreement.

 

23

 

(b)           The
singular includes the plural and the plural includes the singular.

 

(c)           Unless
otherwise expressly indicated, a reference to any law or regulation includes
any amendment or modification to, or replacement of, such law or regulation.

 

(d)           A
reference to any Person includes its permitted successors and permitted
assigns.

 

(e)           Accounting
terms not otherwise defined herein have the meanings assigned to them by GAAP
applied on a consistent basis by the accounting entity to which they refer.

 

(f)            The
words “include,” “includes” and “including” are not limiting.

 

(g)           All
terms not specifically defined herein or by GAAP, which terms are defined in
the Uniform Commercial Code as in effect in the State of New York, have the
meanings assigned to them therein, with the term “instrument” being that term
as defined under Article 9 of the Uniform Commercial Code.

 

(h)           Reference
to a particular “Section” refers to that section of this Credit Agreement
unless otherwise indicated.  Reference to
a particular “Exhibit” or “Schedule” refers to that Exhibit or Schedule,
as applicable, to this Credit Agreement.

 

(i)            The
words “herein,” “hereof,” “hereunder” and words of like import shall refer to
this Credit Agreement as a whole and not to any particular section or
subdivision of this Credit Agreement.

 

(j)            Unless
otherwise expressly indicated, in the computation of periods of time from a
specified date to a later specified date, the word “from” means “from and
including,” the words “to” and “until” each mean “to but excluding,” and the
word “through” means “to and including.”

 

(k)           This
Credit Agreement and the other Loan Documents may use several different
limitations, tests or measurements to regulate the same or similar matters. All
such limitations, tests and measurements are, however, cumulative and are to be
performed in accordance with the terms thereof.

 

(l)            This
Credit Agreement and the other Loan Documents are the result of negotiation
among, and have been reviewed by counsel to, among others, the Administrative
Agent, the Lenders, the Guarantors and the Borrowers and are the product of
discussions and negotiations among all parties. Accordingly, this Credit Agreement
and the other Loan Documents are not intended to be construed against the
Administrative Agent or any of the Lenders, the Swingline Lender or Issuing
Bank merely on account of such Person’s involvement in the preparation of such
documents.

 

(m)          If
at any time any change in GAAP would affect the computation of any financial
ratio or requirement set forth in any Loan Document, and either the Borrowers
or the Required Lenders shall so request, the Administrative Agent, the
Lenders, the 

 

24

 

Borrowers and the Guarantors shall negotiate in good
faith to amend such ratio or requirement to preserve the original intent
thereof in light of such change in GAAP (subject to the approval of the
Required Lenders); provided that, until so amended, (i) such ratio or
requirement shall continue to be computed in accordance with GAAP prior to such
change therein and (ii) the Borrowers shall provide to the Administrative
Agent and the Lenders financial statements and other documents required under
this Credit Agreement or as reasonably requested hereunder setting forth a
reconciliation between calculations of such ratio or requirement made before
and after giving effect to such change in GAAP.

 

2.                            REVOLVING
LOANS AND TERM LOAN.

 

2.1         Revolving Loans.

 

2.1.1                        Commitments to Make Revolving Loans.  Subject to the terms and conditions of this
Credit Agreement, each Revolving Credit Lender agrees, severally and not
jointly, to make Revolving Loans to the Borrowers from time to time during the
period commencing on the Closing Date and ending on the Revolver Maturity Date,
from time to time, during which period the Borrowers may borrow, repay and
reborrow in accordance with the terms of this Credit Agreement; provided, however, that the Borrowers shall not be permitted to borrow
Revolving Loans hereunder to the extent that (a) such borrowing would
cause the total Revolving Exposure to exceed the Revolving Credit Limit, or (b) a
Default has occurred and is continuing or would otherwise be caused by such
borrowing.

 

In the event that such borrowing would cause the total Revolving
Exposure to exceed the Revolving Credit Limit, the Borrowers agree that such
event shall be an Event of Default unless the Borrowers shall, within two (2) Business
Days after notice of such excess from the Administrative Agent, pay cash to the
Administrative Agent in such amount as shall be necessary to eliminate such
excess.

 

2.1.2                        Extension of Revolver Maturity Date.  In the event that (a) there does not
exist a Default at the time an Extension Request is made, and at the time such
Extension Request would take effect, (b) the Borrowers pay, on or before
the Revolver Maturity Date that would then be extended, to the Administrative
Agent for the pro rata benefit of the Lenders in accordance with their
respective Revolving Loan Commitment Percentages, an extension fee equal to
12.5 basis points of the Revolving Credit Limit then in effect, and (c) a
timely Extension Request has been made, the Revolver Maturity Date shall be
extended for a period of six months.

 

2.1.3                        Unused Facility Fee.  The Borrowers agree to pay to the
Administrative Agent for the pro rata benefit of the Lenders in accordance with
their respective Revolving Loan Commitment Percentages a fee (the “Unused Facility
Fee”) calculated as follows:

 

25

 

(a)           Each
day prior to the Revolver Maturity Date that the “Daily Unused Amount” (as
defined below) equals or exceeds 50% of the Revolving Credit Limit then in
effect, the Unused Facility Fee will accrue at the rate of 0.20% per annum
(based on a 360 day year and actual number of days elapsed) times the Daily
Unused Amount.

 

(b)           Each
day prior to the Revolver Maturity Date that the Daily Unused Amount is less
than 50% of the Revolving Credit Limit then in effect, the Unused Facility Fee
will accrue at the rate of 0.125% per annum (based on a 360 day year and actual
number of days elapsed) times the Daily Unused Amount.

 

(c)           The
Unused Facility Fee as calculated under this Section for each day of such
Fiscal Quarter shall be payable quarterly in arrears on the first day of each
Fiscal Quarter for the immediately preceding Fiscal Quarter commencing on the
first such date following the date hereof, with a final payment on the Revolver
Maturity Date or any earlier date on which the Revolving Loan Commitments shall
terminate.

 

(d)           For
purposes of the forgoing, the “Daily Unused Amount” shall mean (i) the
Revolving Credit Limit then in effect, minus (ii) the Revolving Exposure,
determined on a daily basis.

 

2.1.4                        Revolving Notes.  At the request from time to time of any
Revolving Credit Lender, such Lender’s portion of the Revolving Loan Commitment
shall be evidenced by a separate promissory note made by the Borrowers payable
to the order of such Lender in substantially the form of Exhibit 2.1.4
(each a “Revolving Note”), dated as of the Closing Date (or such other date on
which such Lender may become a Revolving Credit Lender in accordance with Section 17)
and completed with appropriate insertions. 
Any such Revolving Note shall be payable to the order of such Lender in
a principal face amount equal to such Lender’s Revolving Loan Commitment and
representing the joint and several obligations of the Borrowers to pay to such
Lender such principal amount or, if less, the outstanding amount of all
Revolving Loans actually made by such Lender as reflected from time to time in
the Revolving Loan Account, plus interest accrued thereon, as set forth below.

 

2.1.5                        Interest on Revolving Loans.  Except as otherwise provided in Section 6.13:

 

(a)           Each
Revolving Loan which is a Base Rate Loan shall bear interest for each day such
Loan is outstanding at the rate per annum equal to the Base Rate plus the
Applicable Margin as in effect from time to time applicable to Revolving Loans
that are Base Rate Loans.

 

(b)           Each
Revolving Loan which is a LIBOR Rate Loan shall bear interest for the period
commencing with the Drawdown Date thereof and ending 

 

26

 

on the last day of the Interest Period with respect
thereto at the rate per annum equal to the LIBOR Rate determined for such
Interest Period plus the Applicable Margin as in effect from time to time
applicable to Revolving Loans that are LIBOR Rate Loans.

 

(c)           The
Borrowers promise to pay interest on each Revolving Loan in arrears on each
Interest Payment Date with respect thereto.

 

2.1.6                        Requests for Revolving Loans.

 

(a)           Except
with respect to Swingline Loans, the Borrowers shall give to the Administrative
Agent written notice in the form of Exhibit 2.1.6 of each Revolving
Loan requested hereunder (a “Revolving Loan Request”) by no later than 1:00 p.m.
Boston time no less than (a) one (1) Business Day prior to the
proposed Drawdown Date of any Base Rate Loan and (b) three (3) Business
Days prior to the proposed Drawdown Date of any LIBOR Rate Loan. Each such
notice shall specify (i) the principal amount of the Revolving Loan
requested, (ii) the proposed Drawdown Date of such Revolving Loan, (iii) the
Type of such Revolving Loan and (iv) the Interest Period for such
Revolving Loan that is to be a LIBOR Rate Loan. Promptly upon receipt of any
such notice, the Administrative Agent shall notify each of the Lenders
thereof.  Each Revolving Loan Request shall
be irrevocable and binding on the Borrowers and shall obligate the Borrowers to
accept the Revolving Loan requested from such Lenders on the proposed Drawdown
Date. Each Revolving Loan Request with respect to a Base Rate Loan shall be in
a minimum aggregate amount of $500,000 and integral multiples of $100,000 in
excess thereof and each Revolving Loan Request with respect to a LIBOR Rate
Loan shall be in a minimum aggregate amount of $1,000,000 and integral
multiples of $100,000 in excess thereof.

 

(b)           Each
Revolving Loan that is advanced under this Credit Agreement shall be made by
all of the Revolving Credit Lenders simultaneously and proportionately to their
respective Revolving Loan Commitment Percentages, it being understood that no
Revolving Credit Lender shall be responsible for any default by any other
Revolving Credit Lender in such Delinquent Lender’s obligation to make a
Revolving Loan requested hereunder nor shall the Revolving Loan Commitment of
any Lender to make any Revolving Loan be increased or decreased as a result of
a default by a Delinquent Lender in the Delinquent Lender’s obligation to make
a Revolving Loan requested hereunder.  No
later than 4:00 p.m. Boston time on the date that the Administrative Agent
receives a Revolving Loan Request, the Administrative Agent shall notify each
Revolving Credit Lender of such Revolving Loan request.  Each Revolving Credit Lender shall make the
amount of its Revolving Loan available to the Administrative Agent, in same day
funds, at the office of the Administrative Agent located at One Federal Street,
Boston, Massachusetts, not later than 1:00 p.m. Boston time on the date on
which the Revolving Loan is to be made.

 

27

 

(c)           Except
as provided in Section 5 with respect to Revolving Loans to be used
to reimburse the Administrative Agent or Issuing Bank for the amount of any
drawing under a Letter of Credit, upon satisfaction or waiver of the conditions
precedent specified in Section 7, the Administrative Agent shall
make the proceeds of such Revolving Loan available to the Borrowers by causing
an amount of same day funds equal to the proceeds of such Revolving Loan
received by the Administrative Agent from the Revolving Credit Lenders to be
credited to the account of the Borrowers at the Administrative Agent.

 

(d)           Unless
the Administrative Agent shall have been notified by any Revolving Credit
Lender prior to the date on which a Revolving Loan is to be advanced that such
Revolving Credit Lender does not intend to make available to the Administrative
Agent the amount of such Revolving Credit Lender’s Revolving Loan requested on
such date, the Administrative Agent may assume that such Revolving Credit
Lender will make such amount available to the Administrative Agent on such date
and that the Administrative Agent may, in its sole discretion, but shall not be
obligated to, make available to the Borrowers a corresponding amount on the
date of such advance.  If such
corresponding amount is not in fact made available to the Administrative Agent
by such Revolving Credit Lender, the Administrative Agent shall be entitled to
recover such corresponding amount on demand from such Delinquent Lender
together with (i) interest thereon, for each day from the advance of such
Revolving Loan until the date such amount is paid to the Administrative Agent,
at the greater of the rate of interest accruing on such Revolving Loan and a
rate determined by the Administrative Agent in accordance with banking industry
rules on interbank compensation, plus (ii) any administrative,
processing or similar fees customarily charged by the Administrative Agent in
connection with the foregoing.  If such
Delinquent Lender does not pay such corresponding amount forthwith upon the Administrative
Agent’s demand therefor, the Administrative Agent shall promptly notify the
Borrowers and the Borrowers shall immediately pay such corresponding amount to
the Administrative Agent together with interest thereon, for each day such
Revolving Loan is outstanding, at the rate payable under this Credit Agreement
with respect to such Revolving Loan.

 

(e)           Nothing
in this Section shall be deemed to relieve any Delinquent Lender from its
obligation to fulfill its Revolving Loan Commitment hereunder, to prejudice any
rights that the Borrowers may have against any Delinquent Lender as a result of
any default by such Delinquent Lender hereunder, or to require the Borrowers to
pay more than the rate of interest otherwise applicable to the principal
amounts outstanding.

 

2.2         Term Loan.

 

2.2.1                        Commitments to Make Term Loan.  Subject to the terms and conditions set forth
in this Credit Agreement, each Lender agrees, severally and not jointly, to
lend to the Borrowers on the Closing Date the amount of its Term Loan
Commitment Percentage of the Term Loan. On the Closing 

 

28

 

Date the total Term Loan shall be $140,000,000.00. 
Any principal of the Term Loan repaid may not be reborrowed.

 

2.2.2                        Term Notes.  At the request from time to time of any Term
Loan Lender such Lender’s portion of the Term Loan shall be evidenced by a
separate promissory note made by the Borrowers payable to the order of such
Lender in substantially the form of Exhibit 2.2.2 (each a “Term
Note”), dated the Closing Date (or such other date on which such Lender may
become a Term Loan Lender in accordance with Section 17) and
completed with appropriate insertions. Any such Term Note shall be payable to
the order of such Lender in a principal face amount equal to such Lender’s Term
Loan Commitment and representing the joint and several obligations of the
Borrowers to pay to such Lender such principal amount or, if less, the
outstanding amount of the Term Loan actually made by such Lender as reflected
from time to time in the Term Loan Account, plus interest accrued thereon, as
set forth below.

 

2.2.3                        Interest on Term Loan.  Except as otherwise provided in Section 6.13:

 

(a)           To
the extent that all or any portion of the Term Loan bears interest at the Base
Rate, the Term Loan or such portion shall bear interest at the rate per annum
equal to the Base Rate plus the Applicable Margin as in effect from time to
time applicable to all or any portion of the Term Loan bearing interest at the
Base Rate.

 

(b)           To
the extent that all or any portion of the Term Loan bears interest at the LIBOR
Rate, the Term Loan or such portion shall bear interest during the applicable
Interest Period at the rate per annum equal to the LIBOR Rate determined for
such Interest Period plus the Applicable Margin as in effect from time to time
applicable to all or any portion of the Term Loan bearing interest at the LIBOR
Rate.

 

(c)           The
Borrowers promise to pay interest on the Term Loan or any portion thereof in
arrears on each Interest Payment Date with respect thereto.

 

2.3         Types of Loans: Conversion and Continuation Options.

 

2.3.1                        Conversion to Different Type of Loan.  The Borrowers may elect from time to time, by
giving the Administrative Agent written notice in the form of Exhibit 2.3.1
by 1:00 p.m. Boston time, to convert any portion of the outstanding Loans
(other than Swingline Loans) to a Loan of another Type, provided that (a) with
respect to any such conversion of a LIBOR Rate Loan to a Base Rate Loan, the
Borrowers shall give the Administrative Agent at least one (1) Business
Day’s prior written notice of such election; (b) with respect to any such
conversion of a Base Rate Loan to a LIBOR Rate Loan, the Borrowers shall give
the Administrative Agent at least three (3) Business Days’ prior written
notice of such 

 

29

 

election; (c) with respect to any such conversion
of a LIBOR Rate Loan into a Base Rate Loan, such conversion shall only be made
on the last day of the Interest Period with respect thereto unless the
Borrowers pay breakage fees to the extent required pursuant to Section 6.12,
and (d) no Loan may be converted into, or continued as, a LIBOR Rate Loan
when any Default has occurred and is continuing. Promptly upon the receipt of
any such election, the Administrative Agent shall notify the Lenders thereof.
On the date on which such conversion is being made, each Lender shall take such
action as is necessary to transfer its Commitment Percentage of such Loans to
its Domestic Lending Office or its LIBOR Lending Office, as the case may be.
All or any part of outstanding Loans (other than Swingline Loans) of any Type
may be converted into a Loan of another Type as provided herein, provided that
any partial conversion with respect to Loans shall be in an aggregate principal
amount of $1,000,000 or whole multiples of $1,000,000 in excess thereof. Each
Conversion Request by the Borrowers relating to the conversion of any portion
of the Loans to a LIBOR Rate Loan shall be irrevocable.

 

2.3.2                        Continuation of Type of Loan.  Any portion of the Loans of any Type may be
continued as a Loan of the same Type upon the expiration of an Interest Period
with respect thereto by the Borrowers giving to the Administrative Agent
written notice in the form of Exhibit 2.3.1 by 1:00 p.m.
Boston time, to continue any portion of the outstanding Loans (other than
Swingline Loans) as a Loan of such Type; provided that no LIBOR Rate
Loan may be continued as such when any Default has occurred and is continuing,
but shall be automatically converted to a Base Rate Loan on the last day of the
first Interest Period relating thereto ending during the continuance of any
Default of which officers of the Administrative Agent active upon the Borrowers’
account have actual knowledge. In the event that the Borrowers fail to provide
any notice with respect to the continuation of any LIBOR Rate Loan, then such
LIBOR Rate Loan shall be automatically converted to a Base Rate Loan on the
last day of the Interest Period relating thereto. The Administrative Agent
shall notify the Lenders thereof promptly when any such automatic conversion
contemplated by this Section is scheduled to occur.

 

2.3.3                        LIBOR Rate Loans.  Any conversion to or from LIBOR Rate Loans
shall be in such amounts and be made pursuant to such elections so that, after
giving effect thereto, the aggregate principal amount of all LIBOR Rate Loans
having the same Interest Period shall not be less than $1,000,000 or whole
multiples of $1,000,000 in excess thereof. No more than twelve (12) LIBOR Rate
Loans having different Interest Periods may be outstanding at any time.

 

2.3.4                        Notification by Borrowers.  The Borrowers shall notify the Administrative
Agent, such notice to be irrevocable, at least three (3) Business Days
prior to the Drawdown Date of any portion of the Loans if 

 

30

 

all or any portion of the Loans is to bear interest at
the LIBOR Rate. After any portion of the Loans has initially been made, the
provisions of Sections 2.3.1 and 2.3.2 shall apply mutatis
mutandis with respect to such portion of the Loans so that the Borrowers
may have the same interest rate options with respect to such portion of the
Loans outstanding from time to time.

 

2.3.5                        Amounts, Etc.  Any portion of the Loan bearing interest at
the LIBOR Rate relating to any Interest Period shall be in the amount of
$1,000,000 or an integral amount thereof. No Interest Period relating to the
Term Loan or any portion thereof bearing interest at the LIBOR Rate shall
extend beyond the date on which a regularly scheduled installment payment of
the principal of the Term Loan is to be made unless a portion of the Term Loan
at least equal to such installment payment has an Interest Period ending on
such date or is then bearing interest at the Base Rate.

 

2.4         Swingline Loans.

 

2.4.1                        Swingline
Commitment.  Subject to the terms and conditions set forth
herein, the Swingline Lender agrees to make Swingline Loans to the Borrowers
from time to time prior to the Revolver Maturity Date (the “Swingline
Commitment”), in an aggregate principal amount at any time outstanding that
will not result in (i) the aggregate principal amount of outstanding
Swingline Loans exceeding $25,000,000, or (ii) the aggregate Revolving
Exposure exceeding the Revolving Credit Limit; provided, that the
Swingline Lender shall not be required to make a Swingline Loan to refinance an
outstanding Swingline Loan. Within the foregoing limits and subject to the
terms and conditions set forth herein, the Borrowers may borrow, repay and
reborrow Swingline Loans.

 

2.4.2                        Swingline Loan
Borrowing Procedure.  To request a Swingline Loan, the Borrowers
shall deliver a duly completed and executed written notice in the form of Exhibit 2.4.2
to the Administrative Agent and the Swingline Lender not later than 2:00 p.m.
Boston time, on the day (which shall be a Business Day) of a proposed Swingline
Loan (a “Swingline Loan Request”). Each such request shall be irrevocable and
shall specify the amount of the requested Swingline Loan.  Each Swingline Loan shall be a Base Rate
Loan. The Swingline Lender shall make each Swingline Loan available to the
Borrowers by means of a credit to the general deposit account of a Borrower
with the Swingline Lender (or, in the case of a Swingline Loan made to finance
the repayment of a Reimbursement Obligation as provided in Section 5.2,
by remittance to the Issuing Bank) by 3:00 p.m. Boston time, on the
requested date of such Swingline Loan. The Borrowers shall not request a
Swingline Loan if at the time of or immediately after giving effect to the
advance contemplated by such request a Default has occurred and is continuing
or would result therefrom.  Each
Swingline Loan Request shall be made in a minimum 

 

31

 

aggregate amount
of $500,000 or integral multiples of $100,000 in excess thereof.

 

2.4.3                        Prepayment. 
The Borrowers shall have the right at any time and from time to time to
repay any Swingline Loan, in whole or in part, before 2:00 p.m. Boston
time, on the proposed date of repayment.

 

2.4.4                        Participations. 
The Swingline Lender may, at any time in its discretion, by written
notice given to the Administrative Agent (provided such notice requirement
shall not apply if the Swingline Lender and the Administrative Agent are the
same entity) not later than 11:00 a.m. Boston time, on the next succeeding
Business Day following such notice, require the Revolving Credit Lenders to
acquire participations on such Business Day in all or a portion of the
Swingline Loans then outstanding. Such notice shall specify the aggregate
amount of Swingline Loans in which Revolving Credit Lenders will
participate.   Promptly upon receipt of
such notice, the Administrative Agent will give notice thereof to each
Revolving Credit Lender, specifying in such notice such Revolving Credit Lender’s
pro rata share of such Swingline Loan or Swingline Loans proportional to each
Revolving Credit Lender’s Revolving Loan Commitment Percentage. Each Revolving
Credit Lender hereby absolutely and unconditionally agrees, severally but not
jointly, upon receipt of notice as provided above, to pay to the Administrative
Agent, for the account of the Swingline Lender, such Revolving Credit Lender’s
Revolving Loan Commitment Percentage of such Swingline Loan or Swingline Loans.
Each Revolving Credit Lender acknowledges and agrees that its obligation to
acquire participations in Swingline Loans pursuant to this paragraph is
absolute and unconditional and shall not be affected by any circumstance
whatsoever, including the occurrence and continuance of a Default or reduction
or termination of the Commitments, and that each such payment shall be made
without any offset, abatement, withholding or reduction whatsoever (so long as
such payment shall not cause such Lender’s actual share of the Revolving
Exposure to exceed such Lender’s Revolving Loan Commitment). Each Revolving
Credit Lender shall comply with its obligation under this paragraph by wire
transfer of immediately available funds, in the same manner as provided in Section 6.2
with respect to Loans made by such Lender (and Section 2.1.1 shall
apply, mutatis mutandis, to the funding obligations of the Revolving
Credit Lenders), and the Administrative Agent shall promptly pay to the
Swingline Lender the amounts so received by it from the Revolving Credit
Lenders. The Administrative Agent shall notify the Borrowers of any
participations in any Swingline Loan acquired by the Revolving Credit Lenders
pursuant to this paragraph, and thereafter payments in respect of such Swingline
Loan shall be made to the Administrative Agent and not to the Swingline Lender.
Any amounts received by the Swingline Lender from the Borrowers (or other party
on behalf of the Borrowers) in respect of a Swingline Loan after receipt by the
Swingline Lender of the proceeds 

 

32

 

of a sale of participations therein shall be promptly
remitted to the Administrative Agent. Any such amounts received by the
Administrative Agent shall be promptly remitted by the Administrative Agent to
the Revolving Credit Lenders that shall have made their payments pursuant to
this paragraph, as their interests may appear. The purchase of participations
in a Swingline Loan pursuant to this paragraph shall not relieve the Borrowers
of any Default in the payment thereof.

 

2.5         Reduction of Commitments.

 

2.5.1                        Elective Reduction of Commitments.  Provided that there is then no outstanding
Default and that no Default will be caused by such reduction, the Borrowers
shall have the right, without premium or penalty (except as otherwise set forth
herein), at any time and from time to time upon at least three (3) Business
Days prior written notice to the Administrative Agent to reduce by $3,000,000,
or integral multiples of $1,000,000 in excess thereof, or to terminate
entirely, (a) the Term Loan Limit in excess of the then outstanding Term
Loans, or (b) the Revolving Credit Limit in excess of the then outstanding
Revolving Exposure; provided that the Revolving Credit Limit may not be
reduced below $75,000,000 unless all Revolving Loans are paid and performed in
full, all Letters of Credit are terminated, replaced or secured by Cash
Collateral in accordance with Section 5.2 and the Revolving Credit
Limit is reduced to zero.

 

2.5.2                        Pro Rata Reductions in Commitments.  In the event of any such reduction pursuant
to Section 2.5.1, the Commitments of the Lenders shall be either (i) reduced
pro rata in accordance with their respective Revolving Loan Commitment
Percentages or Term Loan Commitment Percentages, as the case may be, of the
amount so reduced, or (ii) as the case may be, terminated. Promptly after
receiving any notice from the Borrowers delivered pursuant to Section 2.5.1,
the Administrative Agent will notify the Lenders of the substance thereof. Upon
the effective date of any such reduction or termination, the Borrowers shall
pay to the Administrative Agent for the respective pro rata accounts of such
Lenders the full amount of any Unused Facility Fee or other Fee then accrued on
the amount of the reduction. No reduction or termination of the Commitments may
be reinstated.  Upon any reduction or
termination of one but not both of the aggregate Revolving Loan Commitments or
Term Loan Commitments of all the Revolving Credit Lenders and Term Loan
Lenders, respectively, pursuant to this Section, the Administrative Agent will
circulate to the Borrowers and each of the Lenders a revised Schedule 2
reflecting such reduction or termination.

3.                            USE
OF PROCEEDS

 

3.1         Use of Proceeds.  The proceeds of the Revolving Loans, the
Swingline Loans and the Term Loan shall be used solely and exclusively for the
following purposes:

 

33

 

3.1.1                        Use of Revolving Loans and Swingline Loans.  The proceeds and availability of the
Revolving Loans and Swingline Loans shall be used as follows:

 

(a)           to
finance the Borrowers’ working capital and general corporate purposes from time
to time in order to facilitate the ongoing operations of the Borrowers in the
ordinary course of their business or as otherwise expressly contemplated by
this Credit Agreement;

 

(b)           to
fund repayment of the Necktie Loans; and

 

(c)           to
acquire tax credit investments (including low income housing tax credits).

 

3.1.2                        Use of Term Loan.  The proceeds of the Term Loan shall be used
as follows:

 

(a)           to
fund repayment of the Necktie Loans; and

 

(b)           to
fund the closing of the Bond Transaction.

 

3.1.3                        Limitations on use of Revolving Loans; Reduction in
Corporate Revolver Commitment. 
(a) $25,000,000 (during such time as the Revolving Credit Limit is
less than $275,000,000), and (b) $50,000,000 (during such time as the
Revolving Credit Limit is equal to or greater than $275,000,000), of the
aggregate Revolving Loan Commitments shall be used exclusively for investments
in low income housing tax credits (“LIHTC Investments”), and up to an
additional $250,000,000 of the aggregate Revolving Loan Commitments (the “Corporate
Revolver Commitment”) may be used for LIHTC Investments and any other use
permitted under Section 3.1.1. 
Notwithstanding the foregoing, in the event that any portion of the
Revolving Loan Commitments shall have been used by a Borrower’s Subsidiary for
LIHTC Investments where either equity investments in particular projects or
loans to particular projects remain outstanding for longer than nine months (“Stale
LIHTC Investments”), the Corporate Revolver Commitment shall be reduced on a
dollar for dollar basis by the aggregate amount of the Stale LIHTC
Investments.  With respect to each LIHTC
Investment made prior to or after the date hereof, such nine month period shall
expire on the later to occur of (i) nine months from the date hereof and (ii) nine
months from the first investment in such LIHTC Investment.  In the event a LIHTC Investment consists of a
loan or loans to a low income housing tax credit project which is followed by
an equity investment in such project, for purposes of determining the existence
of a Stale LIHTC Investment, two separate nine month periods shall be measured
for the periods of time (y) that any portion of such loan or loans remain
outstanding, and (z) from the time the first equity investment in such
project is made.

 

34

 

4.                            REPAYMENT
OF REVOLVING LOANS AND TERM LOAN.

 

4.1         Revolving Loans.

 

4.1.1        Maturity.  The Borrowers promise to pay on the Revolver
Maturity Date, and there shall become absolutely due and payable on the
Revolver Maturity Date, all of the Revolving Loans outstanding on such date,
together with any and all accrued and unpaid interest thereon and all other
fees and other amounts and Obligations then accrued and outstanding with
respect thereto.

 

4.1.2        Optional
Repayments of Revolving Loans. 
The Borrowers shall have the right, at their election, to repay all or
any portion of the outstanding Revolving Loans, at any time without penalty or
premium; provided that any full or partial prepayment of the outstanding
amount of any Revolving Loans that are LIBOR Rate Loans may be made only on the
last day of the Interest Period relating thereto (unless breakage costs are
paid by the Borrowers pursuant to Section 6.12).  The Borrowers shall provide to the
Administrative Agent, no later than 12:00 p.m. Boston time, at least three
(3) Business Days prior written notice of any proposed prepayment of any
LIBOR Rate Loans pursuant to this Section, specifying the proposed date of
prepayment and the principal amount to be prepaid. Any prepayment of the
Revolving Loans shall be applied, in the absence of instruction by the
Borrowers, first to the principal of Revolving Loans which are Base Rate Loans
and second to the principal of Revolving Loans which are LIBOR Rate Loans. Each
partial prepayment shall be allocated among the Lenders, in proportion to their
respective Revolving Loan Commitment Percentages, to the respective unpaid
principal amount of each such Lender’s outstanding Revolving Loans as reflected
in the Revolving Loan Account.  No amount
repaid with respect to the Term Loan may be reborrowed.

 

4.2           Term Loan.

 

4.2.1        Amortization
of Term Loan.  The
Borrowers shall repay to the Administrative Agent, for the ratable benefit of
the Term Loan Lenders in accordance with their respective Term Loan
Commitments, the principal amount of the Term Loan in such amounts so that the
remaining outstanding principal balance of the Term Loan shall be (i) reduced
by $15,000,000 on or before March 31, 2008 from the maximum Term Loan
Limit established on or after the date hereof pursuant to the definition of
Term Loan Limit, (ii) reduced by an additional $15,000,000 on or before June 30,
2008, (iii) reduced by an additional $45,000,000 on or before August 31,
2008, and (iv) reduced by an additional $25,000,000 on or before October 31,
2008.  The entire outstanding principal
balance of the Term Loan, along with all interest thereon and any other
Obligations 

 

35

 

relating thereto, shall
be due and payable in full on the Term Loan Maturity Date.

 

4.2.2                        Mandatory Prepayments of Term Loan.  Concurrently with the receipt by CHC or any
of its Subsidiaries of:

 

(a)           any
Asset Sale Proceeds received by CHC or such Subsidiary during the term of this
Credit Agreement;

 

(b)           net
cash proceeds received by CHC or such Subsidiary from Casualty Events which
have not been utilized by CHC or such Subsidiary to repair or replace the
property so damaged, destroyed or taken within one hundred eighty (180) days of
receipt of such proceeds (or within 365 days of such receipt if a contract for
such utilization is executed and delivered within 365 days of such receipt);

 

(c)           net
cash proceeds received by CHC or such Subsidiary from the Designated Assets
identified on Schedule 4.2.2, or the sale, securitization or other disposition
of any of the Designated Assets;

 

(d)           net
cash proceeds (including, without limitation, net of the amount of capital CCG
is obligated to contribute to CFin Holdings pursuant to the transaction in
which such cash proceeds are generated) received by CCG from the sale of the
Capital Stock of CFin Holdings permitted to be sold hereunder; and

 

(e)           Blizzard Repayment Proceeds;

 

the Borrowers shall pay to the Administrative Agent for the respective
accounts of the Lenders an amount equal to 100% of such proceeds, to be applied
in the manner set forth in Section 4.2.3. Notwithstanding the
foregoing, the provisions of this Section shall not impair any
restrictions or prohibitions set forth in the Loan Documents with respect to
the incurrence of Indebtedness or the consummation of any asset sales by CHC or
any of its Subsidiaries.

 

4.2.3                        Application of Mandatory Repayments.

 

(a)           All payments made pursuant to clauses
(a) and (b) of Section 4.2.2 shall be applied (a) first,
to repay the outstanding principal amount of the Term Loan (to be applied to
installments of the Term Loan in direct order of maturity) pro rata among the
Lenders in accordance with their respective Term Loan Commitment Percentages;
and (b) then, upon payment in full of all outstanding principal amounts of
the Term Loan, to repay the outstanding principal amount of the Revolving
Loans.  Any such payments shall
permanently reduce the Term Loan Limit and the related Term Loan Commitment
and, unless the Required Lenders may otherwise determine in their reasonable
discretion, the Revolving Credit Limit and the related Revolving Loan
Commitment, and may be held by the Administrative Agent, for the benefit of the
Issuing Bank and the Lenders, as 

 

36

 

cash collateral for the then outstanding Letters of
Credit (“Cash Collateral”).  Such
mandatory prepayments shall be allocated among the Lenders in proportion to
their respective Term Loan Commitment Percentages and Revolving Loan Commitment
Percentages, as the case may be.

 

(b)           All payments made pursuant to Sections
1) and 2) of Schedule 4.2.2 pursuant to clause (c), of Section 4.2.2
shall be applied (a) first, to fund the Unfunded Escrow until the
remaining balance of the Unfunded Escrow equals zero Dollars, and (b) second,
to repay the outstanding principal amount of the Term Loan (to be applied to
installments of the Term Loan in direct order of maturity) pro rata among the
Lenders in accordance with their respective Term Loan Commitment Percentages.

 

(c)           All payments made pursuant to Section 3)
of Schedule 4.2.2 pursuant to clause (c), of Section 4.2.2,
and all payments made pursuant to clauses (d) and (e) of
Section 4.2.2, shall be applied to repay the outstanding principal
amount of the Term Loan (to be applied to installments of the Term Loan in
direct order of maturity) pro rata among the Lenders in accordance with their
respective Term Loan Commitment Percentages.

 

(d)           Any payments made pursuant to clauses
(b) or (c) of this Section 4.2.3 that are applied to
repay the outstanding principal amount of the Term Loan shall permanently
reduce the Term Loan Limit and the related Term Loan Commitment.  Such mandatory prepayments shall be allocated
among the Lenders in proportion to their respective Term Loan Commitment
Percentages.  Once the principal amount
of the Term Loan and all Obligations directly relating thereto or arising
therefrom have been fully paid, and provided there is not then outstanding any
Default, any further payments made pursuant to such clauses (b) or (c) will
be released to the Borrowers.

 

4.2.4                        Optional Prepayments of Term Loan.  The Borrowers shall have the right at any
time to prepay the Term Loan on or before the Maturity Date as a whole, or in
part, without premium or penalty; provided that the minimum optional
prepayment amount shall equal or exceed $1,000,000, upon not less than one (1) Business
day with respect to Base Rate Loans and three (3) Business Days with
respect to LIBOR Rate Loans prior written notice to the Administrative Agent; provided
that (a) no portion of the Term Loan bearing interest at the LIBOR Rate
may be prepaid pursuant to this Section except on the last day of the
Interest Period relating thereto (unless breakage costs are paid by the
Borrowers pursuant to Section 6.12) and (b) each partial
prepayment shall be allocated among the Lenders, in proportion to their
respective Term Loan Commitment Percentages, to the respective unpaid principal
amount of each such Lender’s outstanding portion of the Term Loan as reflected
in the Term Loan Account. Any prepayment of principal of the Term Loan shall be
accompanied by payment in full of all interest accrued to the date of
prepayment on the amount being prepaid and shall be applied pro rata to 

 

37

 

the remaining scheduled installments of the Term Loan
on a pro rata basis and pro rata among the Lenders. No amount prepaid with
respect to the Term Loan may be reborrowed.

 

4.3           Swingline
Loans.  The Borrowers
shall repay the then unpaid principal amount of each Swingline Loan on the
Revolver Maturity Date, and may repay the then unpaid principal amount of each
Swingline Loan within five Business Days after each such Swingline Loan is
made.  In the event the Borrowers do not
otherwise repay a Swingline Loan on or before the fifth Business Day after such
Swingline Loan is made, such Swingline Loan shall automatically become a
Revolving Loan bearing interest at the Base Rate applicable to Revolving Loans
advanced by the Administrative Agent ratably for all the Revolving Credit
Lenders.  With respect to such Swingline
Loans in which the Revolving Credit Lenders have not acquired participations in
accordance with Section 2.4.4, promptly upon such Swingline Loan
automatically becoming a Revolving Loan, the Administrative Agent will give
notice thereof to each Revolving Credit Lender, specifying in such notice such
Revolving Credit Lender’s pro rata share of such Revolving Loan proportional to
each Revolving Credit Lender’s Revolving Loan Commitment Percentage.  Each Revolving Credit Lender hereby
absolutely and unconditionally agrees, severally but not jointly, upon receipt
of such notice to pay to the Administrative Agent such Revolving Credit Lender’s
Revolving Loan Commitment Percentage of such Revolving Loan.  Each Revolving Credit Lender acknowledges and
agrees that its obligation to pay its proportionate share of such Revolving
Loan shall not be affected by any circumstances whatsoever, including the
occurrence and continuance of a Default or reduction or termination of the
Commitments, and that each such payment shall be made without any offset,
abatement, withholding or reduction whatsoever (so long as such payment shall
not cause such Revolving Credit Lender’s actual share of the Revolving Exposure
to exceed such Lender’s Revolving Loan Commitment).  Each Revolving Credit Lender shall comply
with its obligation under this paragraph by wire transfer of immediately
available funds, in the same manner as provided in Section 6.2 with
respect to Loans made by such Lender.

 

5.                            LETTERS
OF CREDIT.

 

5.1         Letter of Credit Commitments.

 

5.1.1                        Commitment to Issue Letters of Credit.  Subject to the terms and conditions hereof
and the execution and delivery by the Borrowers of a letter of credit application
on the Issuing Bank’s customary form (a “Letter of Credit Application”), the
Issuing Bank on behalf of the Revolving Credit Lenders and in reliance upon the
agreement of such Lenders set forth in Section 5.1.4 and upon the
representations and warranties of the Borrowers contained herein, agrees to
issue, extend and renew for the account of the Borrowers one or more Letters of
Credit, in such form as may be requested from time to time by one of the
Borrowers and agreed to by the Issuing Bank; and the Administrative Agent (if 

 

38

 

different than the Issuing Bank) shall, on behalf of
the Revolving Credit Lenders and in reliance upon the agreement of such Lenders
set forth in Section 5.1.4 and upon the representations and
warranties of the Borrowers contained herein, agrees to enter into an LC
Guaranty to support the Reimbursement Obligations of the Borrowers with respect
to Letters of Credit requested by a Borrower (an “LC Guaranty”); provided,
however, that after giving effect to such request, (i) the sum of
the aggregate Maximum Drawing Amount on all Letters of Credit and all Unpaid
Reimbursement Obligations, plus the aggregate amount available to be drawn
under the Existing Letter of Credit, shall not exceed $50,000,000 at any one
time and (ii) the Revolving Exposure shall not exceed the Revolving Credit
Limit at such time.

 

5.1.2                        Letter of Credit Applications.  Each Letter of Credit Application shall be
completed to the reasonable satisfaction of the Administrative Agent and the
Issuing Bank. In the event that any provision of any Letter of Credit
Application shall be inconsistent with any provision of this Credit Agreement,
then the provisions of this Credit Agreement shall, to the extent of any such
inconsistency, govern.

 

5.1.3                        Terms of Letters of Credit.  Each Letter of Credit issued, extended or
renewed hereunder shall, among other things, (a) provide for the payment
of sight drafts for honor thereunder when presented in accordance with the
terms thereof and when accompanied by the documents described therein, and (b) have
an expiration date no later than the date which is thirty (30) days (or, if the
Letter of Credit is confirmed by a confirmer or otherwise provides for one or
more nominated persons, sixty (60) days) prior to the Revolver Maturity Date.
Subject to clause (b) above, each Letter of Credit shall expire (without
giving effect to any extension thereof by reason of an interruption of
business) at or prior to the close of business 365 days, in the case of standby
Letters of Credit, or 180 days, in the case of documentary Letters of Credit,
after the date of the issuance of such Letter of Credit (or, in the case of any
renewal or extension thereof, 365 days or 180 days, as applicable, after such
renewal or extension); provided that the Issuing Bank may, in its sole
and absolute discretion, agree to issue any such standby Letter of Credit
providing for automatic extensions thereof to a date not later than 365 days
beyond its current expiration date; and provided  further that any
such automatic extension Letter of Credit must permit the Issuing Bank to
prevent any such extension at least once in each twelve-month period
(commencing with the date of issuance of such Letter of Credit) by giving prior
notice to the beneficiary thereof not later than a day in each such
twelve-month period to be agreed upon at the time such Letter of Credit is
issued. Each Letter of Credit so issued, extended or renewed shall be subject
to the Uniform Customs and Practice for Documentary Credits (1993 Revision),
International Chamber of Commerce Publication No. 500 or any successor
version thereto adopted by the Issuing Bank in the ordinary course of its
business as a letter of 

 

39

 

credit issuer and in effect at the time of issuance of
such Letter of Credit (the “Uniform Customs”) or, in the case of a standby
Letter of Credit, either the Uniform Customs or the International Standby
Practices (ISP98), International Chamber of Commerce Publication No. 590,
or any successor code of standby letter of credit practices among banks adopted
by the Issuing Bank in the ordinary course of its business as a standby letter
of credit issuer and in effect at the time of issuance of such Letter of
Credit. No Letter of Credit shall be for less than $500,000.00 (unless
otherwise agreed to by the Issuing Bank) and there shall be no more than ten (10) Letters
of Credit outstanding at any one time.

 

5.1.4                        Letter of Credit Participation of Lenders.  Each Revolving Credit Lender severally, but
not jointly, agrees that it shall be absolutely liable, without regard to the
occurrence of any Default or any other condition precedent whatsoever, to the
extent of such Lender’s Revolving Loan Commitment Percentage, to reimburse the
Administrative Agent on demand for the amount of each draft paid by the Issuing
Bank under each Letter of Credit issued for the account of either of the
Borrowers and, if applicable, each payment made by the Administrative Agent to
the Issuing Bank under any LC Guaranty relating to any Letter of Credit issued
for the account of either of the Borrowers to the extent that such amount is
not reimbursed by the Borrowers pursuant to Section 5.2 (such
agreement by a Lender being called herein the “Letter of Credit Participation”
of such Lender).

 

5.1.5                        Participations of Lenders.  Each such payment made by a Revolving Credit
Lender shall, unless the applicable Reimbursement Obligation has been otherwise
funded as a Revolving Loan bearing interest at the Base Rate pursuant to Section 5.2,
be treated as the purchase by such Revolving Credit Lender of a participating
interest in the Borrowers’ Reimbursement Obligation under Section 5.2
in an amount equal to such payment. To that extent, each Revolving Credit
Lender shall share in accordance with its respective Revolving Loan Commitment
Percentage, in any interest which accrues pursuant to Section 5.2.

 

5.2         Reimbursement Obligation of the Borrowers.  In order to induce the Administrative Agent
to cause the Issuing Bank to issue, extend and renew each Letter of Credit for
the account of the Borrowers, the Borrowers agree to reimburse or pay to the
Administrative Agent, for the account of the Administrative Agent and/or the
Issuing Bank or (as the case may be) the Lenders, with respect to each Letter
of Credit issued, extended or renewed for either of the Borrowers’ account, on
each date that any draft presented under such Letter of Credit is honored by
the Issuing Bank, or the Issuing Bank or the Administrative Agent otherwise
makes a payment with respect thereto or the Administrative Agent makes any
payment under any LC Guaranty, (a) the amount paid by the Issuing Bank or
the Administrative Agent under or with respect to such Letter of Credit, and (b) the
amount of any taxes, fees, charges or other costs and expenses whatsoever 

 

40

 

reasonably 
incurred by the Issuing Bank or Administrative Agent or any Lender
(without duplication of any amounts paid by the Borrowers pursuant to Section 6.3,
and other than Excluded Taxes) in connection with any payment made by the
Issuing Bank, Administrative Agent or any Lender under, or with respect to,
such Letter of Credit (collectively, the “Reimbursement Obligations”); provided
that, subject to the conditions to borrowing set forth herein, payment of each
Reimbursement Obligation by the Borrowers under this Section shall be made
through the automatic funding of a Revolving Loan bearing interest at the Base
Rate applicable to Revolving Loans in an amount equal to the amount of such
Reimbursement Obligation, and the Borrowers hereby irrevocably authorize and
direct the Administrative Agent and Issuing Bank to take such actions as may be
necessary to effectuate such automatic funding of any such Base Rate
Loans.  Notwithstanding the foregoing,
upon the reduction (but not termination) of the Revolving Credit Limit to an
amount less than the then outstanding Revolving Exposure at such time as the
then applicable Maximum Drawing Amount is greater than zero, the Borrowers
shall within one (1) Business Day provide cash or Cash Equivalents to the
Administrative Agent in an amount equal to the lesser of (i) the excess of
the Revolving Exposure over the Revolving Credit Limit, and (ii) such
Maximum Drawing Amount, which amount shall be held by the Administrative Agent
for the benefit of the Lenders and the Administrative Agent as Cash Collateral
for all Reimbursement Obligations, and upon the reduction of the Revolving
Credit Limit to zero, or the acceleration of the Reimbursement Obligations with
respect to all Letters of Credit issued for the account of the Borrowers in
accordance with Section 11.2.1, the Borrowers shall immediately
provide cash or Cash Equivalents to the Administrative Agent in an amount equal
to the then Maximum Drawing Amount on all Letters of Credit issued for the
account of the Borrower, which amount shall be held by the Administrative
Agent, for the benefit of the Lenders and the Administrative Agent, as Cash
Collateral for all Reimbursement Obligations.

 

Each such payment shall be made to the Administrative Agent at the
Administrative Agent’s Office in immediately available funds. Interest on any
and all amounts remaining unpaid by the Borrowers under this Section at
any time from the date such amounts become due and payable (whether as stated
in this Section, by acceleration or otherwise) until payment in full (whether
before or after judgment) shall be payable to the Administrative Agent on
demand and shall accrue interest at the Default Rate.

 

5.3         Letter of Credit Payments.  If any draft shall be presented or other
demand for payment shall be made under any Letter of Credit, the Administrative
Agent shall notify the Borrowers of the date and amount of the draft presented
or demand for payment and of the date and time when it expects to pay such
draft or honor such demand for payment. If the Borrowers fail to reimburse the
Administrative Agent as provided in Section 5.2 on or before the
date that such draft is paid or other payment is made by the Issuing Bank or
the Administrative Agent or, as a result of the applicable borrowing limits
described therein being exceeded such Reimbursement Obligations are not
satisfied by the making of a Revolving Loan 

 

41

 

bearing interest at the Base Rate applicable to
Revolving Loans, the Administrative Agent may at any time thereafter notify the
Revolving Credit Lenders of the amount of any such Unpaid Reimbursement Obligation.
No later than 2:00 p.m. Boston time on the Business Day next following the
receipt of such notice, each such Revolving Credit Lender shall make available
to the Administrative Agent, at the Administrative Agent’s Office, in
immediately available funds, such Revolving Credit Lender’s Revolving Loan
Commitment Percentage of such Unpaid Reimbursement Obligation, together with an
amount equal to the product of (a) the average, computed for the period
referred to in clause (c) below, of the weighted average interest rate
paid by the Administrative Agent for federal funds acquired by the
Administrative Agent during each day included in such period, times (b) the
amount equal to such Lender’s Revolving Loan Commitment Percentage of such
Unpaid Reimbursement Obligation, times (c) a fraction, the numerator of
which is the number of days that elapse from and including the date the Issuing
Bank or the Administrative Agent paid the draft presented for honor or
otherwise made payment to the date on which such Lender’s Revolving Loan
Commitment Percentage of such Unpaid Reimbursement Obligation, shall become
immediately available to the Administrative Agent, and the denominator of which
is 360. The responsibility of the Issuing Bank and the Administrative Agent to
the Borrowers and the Lenders shall be only to determine that the documents
(including each draft) delivered under each Letter of Credit in connection with
such presentment shall be in conformity in all material respects with such
Letter of Credit.

 

5.4         Obligations Absolute.  The Borrowers’ obligations under this Section shall
be joint, several, absolute and unconditional under any and all circumstances
and irrespective of the occurrence of any Default or any condition precedent
whatsoever or any setoff, counterclaim or defense to payment which either
Borrower  may have or have had against
the Issuing Bank or the Administrative Agent, any Lender or any beneficiary of
a Letter of Credit. The Borrowers further agree with the Administrative Agent
and the Lenders that none of the Issuing Bank, the Administrative Agent and the
Lenders shall be responsible for, and the Borrowers’ Reimbursement Obligations
under Section 5.2 shall not be affected by, among other things, the
validity or genuineness of documents or of any endorsements thereon, even if
such documents should in fact prove to be in any or all respects invalid,
fraudulent or forged, or any dispute between or among the Borrowers, the
beneficiary of any Letter of Credit or any financing institution or other party
to which any Letter of Credit may be transferred or any claims or defenses
whatsoever of either Borrower against the beneficiary of any Letter of Credit
or any such transferee. None of the Issuing Bank, the Administrative Agent and
the Lenders shall be liable for any error, omission, interruption or delay in
transmission, dispatch or delivery of any message or advice, however
transmitted, in connection with any Letter of Credit. The Borrowers agree that
any action taken or omitted by the Issuing Bank, the Administrative Agent or
any Lender under or in connection with each Letter of Credit and the related
drafts and documents, if done in good faith and in the absence of gross
negligence or willful misconduct, shall be binding upon the Borrowers and the Guarantors
and shall not result in any liability 

 

42

 

on the part of the
Issuing Bank, the Administrative Agent or any Lender to the Borrowers or
Guarantors.

 

5.5         Reliance by Issuer.  To the extent not inconsistent with Section 5.4,
the Issuing Bank and the Administrative Agent shall be entitled to rely, and
shall be fully protected in relying upon, any Letter of Credit, draft, writing,
resolution, notice, consent, certificate, affidavit, letter, cablegram, telegram,
telecopy, telex or teletype message, statement, order or other document
believed by such Person to be genuine and correct and to have been signed, sent
or made by the proper Person or Persons and upon advice and statements of legal
counsel, independent accountants and other experts selected by the Issuing Bank
or the Administrative Agent.

 

5.6         Letter of Credit Fees.  The Borrowers shall pay a fee in respect of
each Letter of Credit issued for the account of either Borrower (in each case,
a “Letter of Credit Fee”):  (a) to
the Administrative Agent in an amount equal to (i) during such time as
there is outstanding no Event of Default, the Applicable Margin per annum with
respect to LIBOR Rate Loans that are Revolving Loans times the Maximum Drawing
Amount of each such Letter of Credit, and (ii) during such time as there
exists an Event of Default, 2% per annum above the otherwise applicable fee (to
the fullest extent permitted by applicable law), which Letter of Credit Fee
shall be for the accounts of the Lenders in accordance with their respective
Revolving Loan Commitment Percentages; and (b) to the Issuing Bank in an
amount equal to 0.125% per annum above the otherwise applicable fee, which
amount shall be for the account of the Issuing Bank as a fronting fee. The
Letter of Credit Fee shall be paid quarterly in arrears on the first Business
Day of each Fiscal Quarter for the immediately preceding Fiscal Quarter. In
respect of each Letter of Credit issued for the account of either Borrower, the
Borrowers shall also pay to the Issuing Bank for the Issuing Bank’s own
account, at such other time or times as such charges are customarily made by
the Issuing Bank, the Issuing Bank’s customary issuance, amendment,
negotiation, payment or document examination and other administrative fees as
in effect and applicable from time to time.

 

6.                            CERTAIN
GENERAL PROVISIONS.

 

6.1         Fees.

 

6.1.1                        Administrative Agent’s Fee.  The Borrowers shall pay to the Administrative
Agent, for its own account, an administrative agent’s fee as set forth in the
Fee Letter (the “Administrative Agent’s Fee”), in the amounts and at the times
referred to therein.

 

6.1.2                        Closing Fees.  The Borrowers shall pay to the Administrative
Agent any additional fees set forth in the Fee Letter and not otherwise defined
herein (the “Closing Fees”), in the amounts and at the times referred to
therein.

 

6.2         Payments to Administrative Agent.  All payments of principal and interest on
Loans and all Reimbursement Obligations, Fees and any other amounts due 

 

43

 

 

hereunder or under any of the other Loan Documents
(unless the provisions of this Credit Agreement or another Loan Document
require otherwise) shall be made on the due date thereof to the Administrative
Agent in Dollars for the respective accounts of the Creditor Parties, by wire
transfer of immediately available funds, at the Administrative Agent’s Office
or at such other place as the Administrative Agent may from time to time
designate, in each case no later than 12:00 p.m. Boston time, and in
immediately available funds.

 

6.3         No Offsets, Taxes Etc.

 

6.3.1                        No Offsets.  Any and all payments by the Borrowers or
Guarantors hereunder or under any of the other Loan Documents shall be made
free and clear of and without deduction or withholding for any and all present
or future Taxes, unless such Taxes are required by law or the administration
thereof to be deducted or withheld (all such Taxes, excluding the Excluded
Taxes and Other Taxes, being referred to herein as “Covered Taxes”).  If the Borrowers or Guarantors shall be
required by law or the administration thereof to deduct or withhold any Covered
Taxes from or in respect of any sum payable hereunder or under any other Loan
Document, (a) the sum payable shall be increased as may be necessary so
that after making all required deductions or withholdings (including deductions
or withholdings applicable to additional amounts paid under this paragraph),
the applicable Creditor Parties receive an amount equal to the sum they would
have received if no such deduction or withholding had been made; (b) the
Borrowers and Guarantors shall make such deductions or withholdings; and (c) the
Borrowers and Guarantors shall pay the full amount deducted or withheld to the
relevant taxation or other authority in accordance with applicable law.

 

6.3.2                        Other Taxes.  The Borrowers and Guarantors agree to pay, in
a timely manner and in accordance with all applicable law, any present or
future stamp or documentary taxes or any other excise or property taxes,
charges or similar levies (all such taxes, charges and levies being herein
referred to as “Other Taxes”) imposed by any jurisdiction (or any political
subdivision or taxing authority thereof or therein) which arise from any
payment made by the Borrowers or Guarantors hereunder or under any of the other
Loan Documents or from the execution, delivery or registration of, or otherwise
with respect to, this Credit Agreement or any of the other Loan Documents.

 

6.3.3                        Indemnification.  The Borrowers and Guarantors agree to
indemnify each of the Creditor Parties for the full amount of Covered Taxes or
Other Taxes not deducted, withheld and paid by the Borrowers or Guarantors in
accordance with Sections 6.3.1 and 6.3.2 on amounts payable by
the Borrowers and Guarantors under this Section which are paid by any of
the Creditor Parties and any liability (including penalties and interest
arising therefrom or with respect thereto, other than penalties and interest 

 

44

 

attributable solely to the gross negligence or willful
misconduct of such Creditor Parties, as applicable) arising therefrom or with
respect thereto, whether or not any such Covered Taxes or Other Taxes were
correctly or legally asserted.  Payment
under this indemnification shall be made within fifteen (15) days from the date
a Creditor Party makes written demand therefor. 
A certificate as to the amount of such Covered Taxes or Other Taxes and
evidence of payment thereof submitted to the Borrowers and Guarantors shall be
conclusive, absent manifest error, of the amount due from the Borrowers or
Guarantors to such Creditor Party.

 

6.3.4                        Non-U.S. Lenders.  Each Creditor Party that is organized under
the laws of a jurisdiction outside the United States (a “Non-U.S. Lender”)
agrees that it shall, no later than the Closing Date (or, in the case of a
Creditor Party which becomes a party hereto pursuant to this Credit Agreement
after the Closing Date, on or prior to the date upon which such Creditor Party
becomes a party hereto), and from time to time thereafter upon the reasonable
request of the Borrowers (but only if such Non-U.S. Lender or beneficial owner
is legally entitled to do so) deliver to the Borrowers and the Administrative
Agent two properly completed and duly executed copies of either United States
Internal Revenue Service Form W-8BEN, W-8ECI or W-8IMY or any subsequent
versions thereof or successors thereto, or any other form prescribed by
applicable law as a basis for claiming exemption from (or reduction in) United
States federal withholding tax together with such supplementary documentation
as may be prescribed by applicable law, in each case claiming complete
exemption from, or reduced rate of, United States federal withholding tax and
payments of interest hereunder.  In
addition, in the case of a Non-U.S. Lender claiming exemption from United
States federal withholding tax under Section 871(h) or Section 881(c) of
the Code, such Non-U.S. Lender (to the extent legally entitled to do so) shall
deliver a certificate, in substantially the same form as Exhibit 6.3.4,
to the Borrowers and the Administrative Agent, certifying that such Non-U.S.
Lender or beneficial owner is not (A) a bank for purposes of Section 881(c)(3)(A) of
the Code, (B) a 10-percent shareholder of any of the Borrowers within the
meaning of Section 881(c)(3)(B) of the Code, and (C) a “controlled
foreign corporation” described in Section 881(c)(3)(C) of the
Code.  Each Non-U.S. Lender (i) agrees
that it shall promptly notify the Borrowers and the Administrative Agent in the
event any such representation provided pursuant to this Section is no
longer accurate and (ii) agrees that it will deliver updated versions of
the foregoing, as applicable, whenever any of the previous certifications
provided herein has become inaccurate in any material respect, together with
such other forms as may be required in order to confirm or establish the
entitlement of such Creditor Party to a continued exemption from or reduction
in United States withholding tax with respect to payments under this Credit
Agreement.  All forms provided in this Section shall
be delivered by each Non-U.S. Lender to the Borrowers and the Administrative
Agent on or before the date it becomes 

 

45

 

a party to this Credit Agreement and on or before the
date, if any, such Non-U.S. Lender changes its applicable lending office by
designating a different lending office (a “New Lending Office”).

 

6.3.5                        U.S. Lenders.  Any Creditor Party that is not a Non-U.S.
Lender and that may not be treated as an exempt recipient based on the
indicators described in Treasury Regulation Section 1.6049-4(c)(1)(ii) shall
deliver to the Borrowers on or prior to the date on which such Creditor Party becomes
a Creditor Party under this Credit Agreement (and from time to time thereafter
as prescribed by applicable law or upon the reasonable request of the
Borrowers), two duly executed and properly completed copies of United States
Internal Revenue Service Form W-9, or any successor form that such
Creditor Party is entitled to provide at such time in order to comply with
United States back-up withholding requirements. 
Notwithstanding any other provision in this Section, no amount shall be
required to be paid to a Creditor Party under this Section with respect to
backup withholding if there has been a notified underreporting pursuant to Section 3406(a)(1)(C) of
the Code (or similar provision or successor provision) with respect to such
Creditor Party.

 

6.3.6                        Pre-Existing Withholding Requirements.  The Borrowers and Guarantors shall not be
required to indemnify any Non-U.S. Lender, or pay any additional amounts to any
Non-U.S. Lender, in respect of United States federal withholding tax pursuant
to this Credit Agreement to the extent that the obligation to withhold amounts
with respect to United States federal withholding tax existed on the date such
Non-U.S. Lender became a party to this Credit Agreement or, with respect to
payments to a New Lending Office, the date such Non-U.S. Lender designated such
New Lending Office with respect to the Loans; provided, however,
that this clause shall not apply to the extent (i) the indemnity payment
or additional amounts any transferee or assignee of any Creditor Party, or any
Creditor Party through a New Lending Office, would be entitled to receive
(without regard to this clause (i)) do not exceed the indemnity payment or
additional amounts that the Person making the assignment or transfer to such
transferee or assignee, or Creditor Party making the designation of such New
Lending Office, would have been entitled to receive in the absence of such
assignment, transfer or designation, or (ii) the obligation to pay such
additional amounts would not have arisen but for a failure by such Non-U.S.
Lender to comply with the provisions of Section 6.3.4.

 

6.3.7                        Mitigation.  Any Creditor Party claiming any indemnity
payment or additional payment amounts payable pursuant to this Section shall
use reasonable efforts (consistent with legal and regulatory restrictions), at
the Borrowers’ and Guarantors’ expense, (a) to file any certificate or
document reasonably requested in writing by the Borrowers, or (b) to
change the jurisdiction of its applicable lending office if the making of such a
filing or change (i) would avoid the need for or reduce the amount 

 

46

 

of any such indemnity payment or additional amount
which may thereafter accrue, (ii) would not require such Creditor Party to
disclose any information such Creditor Party deems confidential and (iii) would
not, in the sole determination of such Creditor Party, be otherwise
disadvantageous to such Creditor Party.

 

6.3.8                        Refunds.  If any Creditor Party (including a
transferee) determines in its sole discretion that it is entitled to claim a
refund from a Governmental Authority in respect of Covered Taxes or Other Taxes
with respect to which any of the Borrowers or Guarantors has paid additional
amounts pursuant to this Section, it will promptly notify the applicable
Borrower or Guarantor of the availability of such refund claim and shall,
within twenty (20) days after receipt of a written request by such Borrower or
Guarantor, make a claim to the Governmental Authority for such refund at such
Borrower’s or Guarantor’s expense.  If
any Creditor Party receives a refund (including a refund made pursuant to the
preceding sentence) in respect of any Covered Taxes or Other Taxes with respect
to which a Borrower or Guarantor has paid additional amounts pursuant to this
Section, such Creditor Party shall within ten (10) Business Days from the
date of the receipt pay over such refund (solely to the extent of such Borrower’s
or Guarantor’s payment, plus a pro rata portion of any interest paid by the relevant
Governmental Authority with respect to such refund) to such Borrower or
Guarantor, net of all out of pocket expenses of such Creditor Party incurred in
connection with obtaining such refund, including reasonable attorneys fees; provided,
however, that such Borrower or Guarantor, upon the request of such
Creditor Party, agrees to repay the amount paid over to such Borrower or
Guarantor (plus any penalties, interest or other charges imposed by the
relevant Governmental Authority) to the applicable Creditor Party in the event
such Creditor Party is required to repay such refund to such Governmental
Authority.  This Section shall not
be construed to require any Creditor Party to make available its tax returns
(or any other information relating to its taxes that it deems confidential) to
a Borrower, a Guarantor or any other Person. 
Notwithstanding anything to the contrary, in no event will any Creditor
Party be required to pay any amount under this Section the payment of
which would place such Creditor Party in a less favorable net after-tax
position than such Creditor Party would have been in if the additional amounts
giving rise to such refund of any Covered Taxes or Other Taxes had never been
paid.

 

6.3.9                        Evidence of Payment.  The Borrowers and Guarantors shall furnish to
the Administrative Agent and each of the Creditor Parties the original or a
certified copy of a receipt evidencing any payment of Covered Taxes or Other
Taxes made by the Borrowers or Guarantors as soon as such receipt becomes
available.

 

47

 

6.3.10                  Survival.  The provisions of this Section shall
survive the termination of this Credit Agreement and repayment of all
Obligations.

 

6.4         Computations.  All computations of interest on Loans, any Fees
or any other amount due hereunder shall, unless otherwise expressly provided
herein, be based on a 365/366-day year for all Base Rate Loans, and a 360-day
year for all other purposes, and paid for the actual number of days elapsed.
Except as otherwise provided in the definition of the term “Interest Period”
with respect to LIBOR Rate Loans, whenever a payment hereunder or under any of
the other Loan Documents becomes due on a day that is not a Business Day, the
due date for such payment shall be extended to the next succeeding Business
Day, and interest and fees shall accrue during such extension.

 

6.5         Interest Limitation.  Notwithstanding any other term of this Credit
Agreement or any other document referred to herein or therein, the maximum
amount of interest which may be charged to or collected from any Person liable
hereunder by the Lenders shall be absolutely limited to, and shall in no event
exceed, the maximum amount of interest which could lawfully be charged or
collected under applicable law (including, to the extent applicable, the
provisions of Section 5197 of the Revised Statutes of the United States,
as amended or 12 U.S.C. Section 85, as amended), so that the maximum of
all amounts constituting interest under applicable law, howsoever computed,
shall never exceed as to any Person liable therefor such lawful maximum, and
any term of this Credit Agreement or any other document referred to herein or
therein which could be construed as providing for interest in excess of such
lawful maximum, shall be and hereby is made expressly subject to and modified
by the provisions of this paragraph.

 

6.6         Inability to Determine LIBOR Rate.  In the event, prior to the commencement of
any Interest Period relating to any LIBOR Rate Loan, the Administrative Agent shall
in good faith determine or be notified by the Required Lenders that (a) adequate
and reasonable methods do not exist for ascertaining the LIBOR Rate that would
otherwise determine the rate of interest to be applicable to any LIBOR Rate
Loan during any Interest Period or (b) the LIBOR Rate determined or to be
determined for such Interest Period will not adequately and fairly reflect the
cost to the Lenders of making or maintaining their LIBOR Rate Loans during such
period, the Administrative Agent shall forthwith give notice of such
determination (which shall be conclusive and binding on the Borrowers and the
Lenders) to the Borrowers and the Lenders. In such event (i) any Loan
Request or Conversion Request with respect to LIBOR Rate Loans shall be automatically
withdrawn and shall be deemed a request for Base Rate Loans, (ii) each
LIBOR Rate Loan will automatically, on the last day of the then current
Interest Period relating thereto, become a Base Rate Loan and (iii) the
obligations of the Lenders to make LIBOR Rate Loans shall be suspended until
the Administrative Agent or the Required Lenders determine that the
circumstances giving rise to such suspension no longer exist, whereupon the
Administrative Agent or, as the case may be, the Administrative Agent upon the
instruction of the Required Lenders, shall so notify the Borrowers and the
Lenders.

 

48

 

6.7         Illegality.  Notwithstanding any other provisions herein,
if any present or future law, regulation, treaty or directive or in the
interpretation or application thereof shall make it unlawful for any Lender to (i) make
or maintain LIBOR Rate Loans, or (ii) perform its obligations in respect
of any LIBOR Rate Loan, such Lender shall forthwith give notice of such
circumstances to the Borrowers, the Administrative Agent and the other Lenders
and thereupon (a) the commitment of such Lender to make LIBOR Rate Loans
or convert Loans of another Type to LIBOR Rate Loans shall forthwith be
suspended, and (b) such Lender’s Loans then outstanding as LIBOR Rate
Loans if any such Loans exist, shall be converted automatically to Base Rate
Loans on the last day of each Interest Period applicable to such LIBOR Rate
Loans or within such earlier period as may be required by law. The Borrowers
hereby agree promptly to pay to the Administrative Agent for the account of
such Lender, upon demand by such Lender, any additional amounts necessary to
compensate such Lender for any costs incurred by such Lender in making any
conversion in accordance with this Section, including any interest or fees
payable by such Lender to lenders of funds obtained by it in order to make or
maintain its LIBOR Rate Loans hereunder.

 

6.8         Additional Costs, Etc.  If any present or future applicable law, which
expression, as used herein, includes statutes, rules and regulations
thereunder and interpretations thereof by any Governmental Authority charged
with the administration or the interpretation thereof and requests, directives,
instructions and notices at any time or from time to time hereafter made upon
or otherwise issued to any Creditor Party by any central bank or other fiscal,
monetary or other authority (whether or not having the force of law), shall:

 

6.8.1                        Taxes. 
subject any Creditor Party to any Tax or withholding of any nature with
respect to this Credit Agreement, the other Loan Documents, any Letters of
Credit, such Creditor Party’s Commitment or the LIBOR Rate Loans, or change in
the basis of taxation of payments to such Creditor Party (other than Taxes,
levies, imposts, charges, fees, deductions or withholdings covered by Section 6.3
and the imposition of, or any change in the rate of, any Excluded Tax payable
by such Creditor Party), or

 

6.8.2                        Reserves.  impose or increase or render applicable
(other than to the extent specifically provided for elsewhere in this Credit
Agreement) any special deposit, reserve, assessment, liquidity, capital
adequacy or other similar requirements (whether or not having the force of law)
against assets held by, or deposits in or for the account of, or loans by, or
letters of credit issued by, or commitments of an office of any Creditor
Party), or

 

6.8.3                        Other Costs.  impose on any Creditor Party any other
conditions or requirements with respect to this Credit Agreement, the other
Loan Documents, such Lender’s or the Swingline Lender’s Commitment, any Letters
of Credit or, the LIBOR Rate Loans, and the result of any of the foregoing is:

 

49

 

(a)           to
increase the cost to any Creditor Party of making, funding, issuing, renewing,
extending or maintaining any of the LIBOR Rate Loans, such Commitment or any
Letter of Credit, or

 

(b)           to
reduce the amount of principal, interest, Reimbursement Obligation or other
amount payable to such Creditor Party hereunder on account of such Commitment,
any Letter of Credit or any of the Loans, or

 

(c)           to
require such Creditor Party to make any payment or to forego any interest or
Reimbursement Obligation or other sum payable hereunder, the amount of which
payment or foregone interest or Reimbursement Obligation or other sum is
calculated by reference to the gross amount of any sum receivable or deemed
received by such Creditor Party from the Borrowers hereunder,

 

then, and in each such case, the Borrowers will, upon demand made by
such Creditor Party at any time and from time to time and as often as the
occasion therefor may arise, pay to such Creditor Party such additional amounts
as will be sufficient to compensate such Creditor Party for such additional
cost, reduction, payment or foregone interest or Reimbursement Obligation or
other sum upon presentation by such Creditor Party of a certificate in
accordance with Section 6.10; provided that the Borrowers
shall not be liable to any Creditor Party for costs incurred more than one
hundred eighty (180) days prior to receipt by the Borrowers of such certificate
from such Creditor Party, as applicable, unless such costs were incurred prior
to such 180-day period solely as a result of such present or future applicable
law being retroactive to a date which occurred prior to such 180-day period.

 

6.9         Capital Adequacy.  If after the date hereof any Creditor Party
determines that (i) the adoption of or change in any law, governmental
rule, regulation, policy, guideline or directive (whether or not having the
force of law) regarding capital requirements for banks or bank holding
companies or any change in the interpretation or application thereof by a court
or governmental authority with appropriate jurisdiction, or (ii) compliance
by such Creditor Party or any corporation controlling such Creditor Party with
any law, governmental rule, regulation, policy, guideline or directive (whether
or not having the force of law) of any such entity regarding capital adequacy,
has the effect of reducing the return on such Creditor Party’s commitment with
respect to any Loans to a level below that which such Creditor Party could have
achieved but for such adoption, change or compliance (taking into consideration
such Creditor Party’s then existing policies with respect to capital adequacy
and assuming full utilization of such entity’s capital) by any amount deemed by
such Creditor Party to be material, then such Creditor Party may notify the
Borrowers of such fact upon presentation of a certificate in accordance with Section 6.10.
To the extent that the amount of such reduction in the return on capital is not
reflected in the Base Rate, the Borrowers and such Creditor Party shall
thereafter attempt to negotiate in good faith, within thirty (30) days of the
day on which the Borrowers receive such notice, an adjustment to the
compensation payable hereunder which will adequately compensate such Creditor
Party in light of these circumstances. If the Borrowers and such Creditor Party
are 

 

50

 

unable to agree to such adjustment within thirty (30)
days of the date on which the Borrowers receive such notice, then commencing on
the date of such notice (but not earlier than the effective date of any such
increased capital requirement), the fees payable hereunder shall increase by an
amount that will, in such Creditor Party’s reasonable determination, provide
adequate compensation; provided that the Borrowers shall not be liable
to any Creditor Party for costs incurred more than one hundred eighty (180)
days prior to receipt by the Borrowers of such notice. Each Creditor Party
shall allocate such cost increases among its customers in good faith and on an
equitable basis.

 

6.10                Certificate.  A certificate setting forth any additional
amounts payable pursuant to Section 6.8 or Section 6.9
and a reasonably detailed explanation of such amounts which are due, submitted
by any Creditor Party to the Borrowers, shall be prima  facie
evidence in the absence of manifest error that such amounts are due and owing.

 

6.11               Mitigation Obligations; Replacement of Lenders.

 

6.11.1                  Designation of a Different Lending Office.  If any Lender requests compensation, or the
Borrowers are required to pay any additional amounts to or for the benefit of
such Lender, pursuant to Section 6.7, Section 6.8 or Section 6.9,
or if any Lender gives a notice pursuant to Section 6.7, then such
Lender shall use reasonable efforts to designate a different Domestic Lending
Office or LIBOR Lending Office for funding or booking its Loans hereunder or to
assign its rights and obligations hereunder to another of its offices, branches
or Affiliates, if, in the judgment of such Lender, such designation or
assignment (a) would eliminate or reduce amounts compensable or payable
pursuant to Section 6.7, Section 6.8 or Section 6.9,
as the case may be, in the future, or eliminate the need for the notice
pursuant to Section 6.7 as applicable, and (b) in each case,
would not subject such Lender to any unreimbursed cost or expense and would not
otherwise be disadvantageous to such Lender. 
The Borrowers hereby agree to pay all reasonable costs and expenses
incurred by any Lender in connection with any such designation or assignment.

 

6.11.2                  Replacement of Lenders.  If any Lender requests compensation, or the
Borrowers are required to pay any additional amount to or for the benefit of
any such Lender, under Section 6.7, Section 6.8 or Section 6.9,
the Borrowers may replace such Lender in accordance with Section 6.14.

 

6.11.3                  Survival.  All of the Borrower’s Obligations under Section 6.7,
Section 6.8, Section 6.9 and this Section shall
survive termination of the Commitments and repayment of all other Obligations
hereunder.

 

6.12               Indemnity.  The Borrowers agree to indemnify the
Administrative Agent and  each Lender and
to hold each of them harmless from and against any loss, cost or 

 

51

 

expense  that
such Person may sustain or incur as a consequence of (a) default by the
Borrowers in payment of the principal amount of or any interest on any LIBOR
Rate Loans as and when due and payable, including any such loss or expense
arising from interest or fees payable by such Lender to lenders of funds
obtained by it in order to maintain its LIBOR Rate Loans, (b) default by
the Borrowers in making a borrowing or conversion after a Borrower has given
(or is deemed to have given) a Loan Request or a notice (in the case of all or
any portion of the Loans pursuant to Section 2.3.4) or a Conversion
Request relating thereto in accordance with Section 2.3.1 or 2.3.2
or (c) the making of any payment of a LIBOR Rate Loan or the making of any
conversion of any such Loan to a Base Rate Loan on a day that is not the last
day of the applicable Interest Period with respect thereto, including interest
or fees payable by such Lender to lenders of funds obtained by it in order to
maintain any such Loans.

 

6.13                 Interest and Fees After Event of Default.  At the Administrative Agent’s discretion or
upon written request of the Required Lenders, upon the occurrence and during
the continuance of an Event of Default, the Borrowers shall pay interest on the
principal amount of all outstanding Obligations (other than Obligations arising
out of Derivative Agreements not directly relating to the Loans) at a
fluctuating interest rate per annum at all times equal to the Default Rate, and
Letter of Credit Fees at a rate 2% per annum above the otherwise applicable
fee, to the fullest extent permitted by applicable laws.

 

6.14                 Replacement of Lenders.  (a) If any Lender requests compensation,
or the Borrowers are required to pay any additional amount to or for the
benefit of such Lender, pursuant to Section 6.7, Section 6.8
or Section 6.9, or if any Lender gives a notice pursuant to Section 6.7,
(b) if any Lender is a Delinquent Lender; or (c) if any Lender
refuses to consent, or unreasonably withholds, conditions or delays its
consent, pursuant to Section 23.1.1 or Section 23.1.2;
then the Borrowers may, at their sole expense and effort, upon notice to such
Lender and the Administrative Agent, require such Lender to assign and
delegate, without recourse (in accordance with and subject to the restrictions
contained in, and consents required by, Section 17), all of its
interests, rights and obligations under this Credit Agreement and the other
Loan Documents to an Eligible Assignee that shall assume such obligations; provided
that:

 

(i)            the
Borrowers shall have paid to the Administrative Agent the processing and
recordation fee specified in Section 17.2.2;

 

(ii)           such
Lender shall have received payment of an amount equal to the outstanding
principal of all Loans made by it, accrued interest thereon, accrued fees and
all other amounts payable hereunder and under the other Loan Documents
(including any amounts under Section 6.7, Section 6.8
or Section 6.9) from the Eligible Assignee (to the extent of such
outstanding principal and accrued interest and fees) or the Borrowers (in the
case of all other amounts); and

 

(iii)          such
assignment does not conflict with any applicable laws.

 

52

 

A Lender shall not be required to make any such assignment or
delegation pursuant to this Section if, prior to the consummation of such
assignment, as a result of a waiver by such Lender or otherwise, the
circumstances entitling the Borrowers to require such assignment and delegation
cease to apply.

 

7.                            CONDITIONS
PRECEDENT

 

The obligations of the Lenders to make the Loans, for the Issuing Bank
to issue Letters of Credit, and for the Swingline Lender to make the Swingline
Loans are subject to the following conditions precedent:

 

7.1         Documents.  The Creditor Parties shall have received each
of the following, in form and substance reasonably satisfactory to such
Creditor Parties and their respective counsel:

 

(a)           Counterparts
of this Credit Agreement, and the other Loan Documents, including, without
limitation, those documents reflected on the Closing Checklist attached to this
Credit Agreement as Exhibit 7.1, duly executed and delivered by
each of the parties thereto;

 

(b)           A
firm commitment from such investors as
are reasonably acceptable to each of the Lenders for the cash purchase
from CHC of at least $100,000,000 of its convertible preferred Capital Stock;
and

 

(c)           Such
other documents, agreements and instruments and the completion of all actions
as the Creditor Parties may reasonably request.

 

7.2         Other Conditions Precedent to any Loans.

 

(a)           No
Default shall have occurred and be continuing as of the date of the making of
the Loan or would exist immediately after giving effect thereto.

 

(b)           All
warranties and representations made by or on behalf of either of the Borrowers
or any of the Guarantors to any of the Creditor Parties pursuant to the Loan
Documents shall be true and accurate in all material respects.

 

(c)           The
Creditor Parties shall be satisfied that the Pledge Agreements create or will
create, as security for the Obligations, a valid and enforceable perfected
first priority security interest in and Lien upon all of the Equity Collateral
in favor of the Administrative Agent, on behalf of the Creditor Parties,
subject to no other Liens, other than such Liens as are permitted pursuant to
the terms of the Pledge Agreements.

 

(d)           In
the good faith judgment of the Administrative Agent:

 

53

 

no litigation, action,
suit, investigation or other arbitral, administrative or judicial proceeding
shall be pending or threatened which could reasonably be expected to result in
a Material Adverse Effect; and

 

the Borrowers and the
Guarantors shall have received all approvals, consents and waivers, and shall
have made or given all necessary filings and notices as shall be required to
consummate the transactions contemplated hereby without the occurrence of any
default under, conflict with or violation of (1) any Applicable Law or (2) any
agreement, document or instrument to which any such Person is a party or by
which any of them or their respective properties is bound, except for such
approvals, consents, waivers, filings and notices the receipt, making or giving
of which would not reasonably be likely to have a Material Adverse Effect.

 

(e)           The
Borrowers shall have paid the Administrative Agent, for the ratable benefit of
the Lenders, where applicable, such amounts as shall be due under the Fee
Letter and shall have paid all other amounts required to be paid hereunder.

 

(f)            With
respect to any Revolving Loans requested after January 31, 2008, the Existing Letter of
Credit shall have expired or been replaced.

 

8.                            REPRESENTATIONS
AND WARRANTIES

 

In order to induce the Creditor Parties to enter into this Credit
Agreement and to make the Loans, each of the Borrowers, and each of the
Guarantors, jointly and severally, represent and warrant to the Administrative
Agent and to the Swingline Lender, the Issuing Bank and the Lenders as follows:

 

8.1         Financial Information.  True, accurate and complete consolidated
financial statements of each Borrower and consolidating balance sheet and
income statement for CCG, as of and for the period ended September 30,
2007  (the “Balance Sheet Date”), have been
delivered to the Creditor Parties and the same fairly present in all material
respects the financial condition of each Borrower, each Guarantor and each
Pledged Entity as of the date thereof and no material and adverse change has
occurred in such financial condition since the date thereof.

 

8.2         Litigation.  Except as set forth on Schedule 8.2,
there are no actions, suits, proceedings or investigations of any kind pending
or, to the knowledge of either Borrower or any Guarantors, threatened, against
any of them or their respective Subsidiaries, before any court, tribunal or
administrative agency or board that, if adversely determined, would reasonably
be expected to, either in any case or in the aggregate, have a Material Adverse
Effect, 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, or which question the validity of this Credit 

 

54

 

Agreement or any of the
other Loan Documents, or any action taken or to be taken pursuant hereto or
thereto.

 

8.3         Good Title and No Liens.  The Borrowers, the Guarantors and the Pledged
Entities are the lawful owners of their respective assets and are and will be
the lawful owners of such assets, free and clear of all liens and encumbrances
of any nature whatsoever other than (i) as permitted in conjunction with
this Credit Agreement, (ii) liens and encumbrances securing other
Indebtedness incurred in connection with the conduct of business by such
Persons in the ordinary course of their respective businesses consistent with
past practices and listed on Schedule 8.3, (iii) liens and
encumbrances which are being released, terminated or discharged with the
proceeds of the Term Loan or (iv) Permitted Liens.

 

8.4         Franchise, Patents, Copyrights,
Etc.  Each of the Borrowers and each of the
Guarantors possess all franchises, patents, copyrights, trademarks, trade
names, licenses and permits, and rights in respect of the foregoing, required
for the conduct of its business substantially as now conducted, without known
conflict with any rights of others, except to the extent the failure to own or
have the same would not be reasonably expected to have a Material Adverse
Effect.

 

8.5         Entity Matters.

 

8.5.1                        Organization.  Each of the Borrowers, each Guarantor and
each of the Pledged Entities:

 

(a)           is
the type of business entity, formed in the jurisdiction, and qualified to do
business in the jurisdictions, as set forth on Schedule 8.5.1.

 

(b)           that
purports to be a Delaware statutory trust, is a duly organized validly existing
statutory trust in good standing under the laws of the State of Delaware and is
duly qualified in each jurisdiction where the nature of its business is such
that qualification is required, except where failure to be so qualified would
not result in a Material Adverse Effect, and has all requisite power and
authority to conduct its business and to own its property as now conducted or
owned and as contemplated by this Credit Agreement.

 

(c)           that
purports to be a corporation, is a duly organized validly existing corporation
in good standing under the laws of the State of Delaware and is duly qualified
in the jurisdiction where the nature of its business is such that qualification
is required, except where failure to be so qualified would not result in a
Material Adverse Effect, and has all requisite power and authority to conduct
its business and to own its property as now conducted or owned and as
contemplated by this Credit Agreement.

 

(d)           that
purports to be a limited liability company, is a duly organized validly
existing limited liability company in good standing under the laws of the State
of Delaware and is duly qualified in the jurisdiction where the nature of its
business is such that qualification is required, except where failure to be so 

 

55

 

qualified would not result in a Material Adverse
Effect, and has all requisite power and authority to conduct its business and
to own its property as now conducted or owned and as contemplated by this
Credit Agreement.

 

8.5.2        Ownership.  The ownership of the Capital Stock of CCG,
each of the Guarantors and each of the Pledged Entities is set forth on Schedule
8.5.2.  True and complete copies of
each of the Governing Documents for each such Person is listed on Schedule
8.5.2 and have been furnished to the Administrative Agent by the Borrowers
and the Guarantors.  The Borrowers and
the Guarantors further represent and warrant that Schedule 8.5.2 sets
forth all of the information required to be set forth thereon with respect to
all of their respective Subsidiaries that are either (i) a Borrower, a
Guarantor or a Pledged Entity, or (ii) an entity that generates net income
or holds net assets equal to or greater than 5% of CHC’s Consolidated Net
Income or consolidated net assets.  CHC
may unilaterally, from time to time, revise Schedule 8.5.2 by providing
such revised Schedule 8.5.2 to the Administrative Agent, so as to
reflect the addition or removal of Subsidiaries that meet or no longer meet the
criteria set forth above.

 

8.5.3        Taxpayer
Identification Numbers. 
The taxpayer identification numbers and state organizational numbers (if
applicable) of each Borrower, each Guarantor and each Pledged Entity are
accurately stated in Schedule 8.5.3.

 

8.5.4        Equity
Interests.  The Borrowers
and the Guarantors are each the owner, free and clear of all liens and
encumbrances (other than those created in favor of the Administrative Agent
pursuant to the Loan Documents), of the Capital Stock which they purport to own
of each of their respective Subsidiaries required to be listed on Schedule
8.5.2.  All shares of such Capital
Stock constituting corporate shares have been validly issued and are fully paid
and nonassessable, all shares or units of such Capital Stock constituting
equity in other forms of entities (e.g. statutory trusts, limited liability
companies or partnerships) are not subject to any calls or assessments, no
rights to subscribe to any additional Capital Stock of any such Person have
been granted, and no options, warrants, or similar rights are outstanding, except
as set forth on Schedule 8.5.4.

 

8.6         Authorization.  The execution and delivery of this Credit
Agreement and the other Loan Documents to which each Borrower or any Guarantor
is to become a party and the performance by such Persons of the transactions
contemplated hereby and thereby (i) are within the authority of each
Borrower and each Guarantor, as applicable, (ii) have been duly authorized
by all necessary corporate or trust action, as applicable, (iii) do not
conflict with, result in any breach or contravention of or require any consent,
waiver, authorization or approval under any legal requirement to which any such
Person is subject or any judgment, order, writ, injunction, license or permit
applicable to any such Person, as applicable, and (iv) do not conflict
with any provision of any such Person’s Governing Documents or any Contractual 

 

56

 

Obligation of any such Person, as applicable, except,
in each case, where such conflict would not have a Material Adverse Effect.

 

8.7         Valid and Binding.  Each of the Loan Documents constitutes the
legal, valid and binding obligation of each of the Borrowers and the Guarantors
party thereto, enforceable against each such Person in accordance with the
respective terms thereof, subject to bankruptcy, insolvency and similar laws of
general application affecting the rights and remedies of creditors generally
and, with respect to the availability of the remedies of specific enforcement,
subject to the discretion of the court before which any proceeding therefor may
be brought.

 

8.8         Deferred Compensation and ERISA.  Except as could not, individually or in the
aggregate, be reasonably expected to have a Material Adverse Effect, the
Borrowers, the Guarantors, the Pledged Entities and each ERISA Affiliate are in
material compliance with all applicable provisions and requirements of ERISA
and the regulations and published interpretations thereunder with respect to
each Employee Benefit Plan, and have performed all their material obligations
under each Employee Benefit Plan.  No
ERISA Event has occurred or is reasonably expected to occur except ERISA Events
that, individually or in the aggregate, could not reasonably be expected to
result in a liability of any Borrower, Guarantor, Pledged Entity or ERISA
Affiliate in excess of $1,000,000. 
Except to the extent required under Section 4980B of the Code, no
Employee Benefit Plan provides health or welfare benefits (through the purchase
of insurance or otherwise) for any retired or former employees of any Borrower,
Guarantor, Pledged Entity or ERISA Affiliate. 
No Employee Benefit Plan that is a group health plan within the meaning
of Part 6 of Title I of ERISA is self-insured or provides benefits by any
means other the purchase of insurance. 
None of the Borrowers, Guarantors, Pledged Entities or any ERISA
Affiliates has any Guaranteed Pension Plan except as may be designated to the
Lender in writing by the Borrowers from time to time.  As of the most recent valuation date for each
Guaranteed Pension Plan, the amount of unfunded benefit liabilities (as defined
in Section 4001(a)(18) of ERISA), individually or in the aggregate of all
Guaranteed Pension Plans (excluding for purposes of such computation any
Pension Plans with respect to which assets exceed benefit liabilities), does
not exceed $1,000,000; and no “Reportable
Event” within the meaning of Section 4043 of ERISA has occurred with
respect to any Guaranteed Pension Plan. 
The granting of the Loans, the performance by the Borrowers and the
Guarantors of their respective obligations under the Loan Documents and the
Borrowers’, the Guarantors’ and the Pledged Entities’ conducting of their
respective operations do not and will not violate any provisions of ERISA or
any Employee Benefit Plan.

 

8.9         No Materially Adverse Contracts, Etc.  Neither Borrower, no Guarantor, no Pledged
Entity, and none of their respective Subsidiaries is subject to, or in breach
or default under, any charter, corporate or other legal restriction, or any
judgment, decree, order, rule or regulation, that has or is expected in
the future to have, or where such breach or default has or is expected to have,
a Material Adverse Effect.  Neither
Borrower, no Guarantor, no Pledged Entity, and none of their respective 

 

57

 

Subsidiaries is a party to, or in breach or default
under, any contract or agreement that has or is expected to have, or where such
breach or default has or is expected to have, any Material Adverse Effect.

 

8.10                 Compliance With Other Instruments, Laws, Etc.  Neither Borrower, no Guarantor, no Pledged
Entity, and none of their respective Subsidiaries is in violation of any
provision of its Governing Documents, or any Contractual Obligations or any
legal requirements, including, without limitation, with respect to any leverage
limitations, or any environmental, hazardous substance or regulatory matter, in
any of the foregoing cases in a manner that could result in the imposition of
substantial penalties or result in a Material Adverse Effect.

 

8.11                 Tax Status.  The Borrowers, the Guarantors, the Pledged
Entities and their respective Subsidiaries (a) have filed all federal and
state income and all other tax returns, reports and declarations required by
any jurisdiction to which such Person is subject, and (b) have paid all
Taxes shown or determined to be due on such returns, reports and declarations,
except those being contested in good faith and by appropriate proceedings for
which appropriate reserves have been taken and are being maintained in
accordance with GAAP.  Except for Taxes
being contested as provided in clause (b) above, there are no unpaid Taxes
in any material amount claimed to be due in writing by the taxing authority of
any jurisdiction, and such Persons know of no basis for any such claim.

 

8.12                 Holding Company and Investment Company Acts.  Neither Borrower, no Guarantor, no Pledged
Entity, and none of their respective Subsidiaries is a “holding company,” or an
“affiliate” of a “holding company,” as such terms are defined in the Public
Utility Holding Company Act of 2005; nor are any such Persons 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.

 

8.13                 Certain Transactions.  Except as set forth on Schedule 8.13,
as of the date of this Credit Agreement, none of the Related Parties of either  Borrower, any Guarantor, any Pledged
Entity or any of their respective Subsidiaries is presently a party to any
transaction with any such Persons (other than (a) for services as
employees, officers, trustees, agents, attorneys, representatives, advisors or
directors; (b) transactions (i) with
fund entities which are consolidated on the books of any such Person solely
because of the application of FIN 46 or other similar accounting
pronouncements, and (ii) with public investment funds that would have been
so consolidated under FIN 46 or other similar accounting pronouncements, except
for the rights of the investors in such funds to remove the general partners of
such funds without cause; or (c) such transactions between or among one or
more members of The Related Companies Group, on the one hand, and the
Centerline Group, on the other hand, entered into in the ordinary course of
business upon terms and conditions no less advantageous to the Centerline Group
than would be available on an arm’s length basis with a Person who is not an
Affiliate), including any contract, agreement or other arrangement providing
for the furnishing of 

 

58

 

services to or by, providing for rental of real or
personal property to or from, or 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.

 

8.14                 Loan Documents.  All of the representations and warranties of
the  Borrowers and the Guarantors
made in the Loan Documents are true and correct in all material respects.

 

8.15                 Regulations U and X.  No portion of the Loan is to 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.

 

8.16                 Solvency.  After the repayment of the Repayment
Obligations, and taking into account the Obligations hereunder, each of the
Borrowers, the Guarantors, the Pledged Entities and their respective
Subsidiaries are individually, and on a consolidated basis, Solvent.

 

8.17                 No Material Change; No Default.  There has been no (i) Material Adverse
Effect, or (ii) Change in Control, in each case since the date of the
Borrowers’ and Guarantors’ last financial statements most recently delivered to
the Administrative Agent; and there is not currently outstanding any Default.

 

8.18                 Insurance.  Each of the Borrowers, each of the Guarantors
and each of the Pledged Entities maintains in full force and effect such
insurance with financially sound and reputable insurers with respect to such
Person’s properties and business, against such casualties, liabilities and
contingencies, as are in accordance with the general practices of reasonably
prudent businesses engaged in similar activities in similar geographic areas
and in amounts, containing such terms, and in such forms as are reasonable and
prudent in the ordinary course of such Persons’ business.

 

8.19                 Use of Proceeds.  The Borrowers will use the proceeds of the
Loans and will request the issuance of Letters of Credit only for the purposes
and uses specified in Section 3.

 

8.20                 Labor Matters.  Except as could not, individually or in the
aggregate, be reasonably expected to have a Material Adverse Effect, as of the
date hereof, there are no strikes, lockouts or slow downs against either
Borrower, any Guarantor or Pledged Entity or any of their respective
Subsidiaries pending or, to the knowledge of the Borrowers and Guarantors,
threatened.  The consummation of the
transactions contemplated by this Credit Agreement will not give rise to any
right of termination or right of renegotiation on the part of any union under
any collective bargaining agreement to which either Borrower, any Guarantor or
Pledged Entity, or any of their respective Subsidiaries, is bound.  The hours worked by and payments made to
employees of any such Persons have not been in 

 

59

 

violation in any material respect of the federal Fair
Labor Standards Act or any other applicable federal, state, local or foreign
law dealing with such matters and all payments due from such Persons, or for
which any claim may be made against any of such Persons, on account of wages
and employee health and welfare insurance and other benefits have been paid or
accrued as a liability on the books of such Persons.

 

8.21                 Exchange Listing.  CHC currently lists all of its common shares,
and maintains trading privileges with respect to such Capital Stock, on the New
York Stock Exchange, and such listing is valid, current, and in full force and
effect, in compliance with all securities law and exchange rules, regulations
and requirements.

 

8.22                 No Broker or Finder.  Neither Borrower, no Guarantor, and no other
Person acting on their behalf, has dealt with any broker, finder or other
Person who or which may be entitled to a broker’s or finder’s fee, or other
compensation, payable by the Creditor Parties or the Administrative Agent in
connection with the Loans, the execution and delivery of the Loan Documents,
the consummation of the transactions contemplated hereby, and the performance
of the Obligations.

 

8.23                 Information True, Complete and Not Misleading.  All of the factual information provided by or
on behalf of the Borrowers or the Guarantors that is contained or referred to
in this Section and in the Schedules to this Credit Agreement, and in the
certificates and opinions furnished to the Administrative Agent or the Lenders
by or on behalf of  the Borrowers
and the Guarantors in connection with this Credit Agreement or any other Loan
Document, is true, accurate and complete in all material respects, and omits no
material fact necessary to make the same, in light of the circumstances when
made, not misleading.

 

9.                            AFFIRMATIVE
COVENANTS

 

For so long as this Credit Agreement is in effect, and until such time
as all of the Obligations have been indefeasibly fully paid and performed,
unless the Creditor Parties shall otherwise consent in the manner provided for
in Section 23, the Borrowers and the Guarantors shall comply,
jointly and severally, and shall cause all of their Subsidiaries to comply,
with the following covenants:

 

9.1         Punctual Payment.  The Borrowers will duly and punctually pay or
cause to be paid the principal and interest on the Loans and all interest, fees
and other Obligations provided for in this Credit Agreement or any other Loan
Document, all in accordance with the terms of this Credit Agreement and the
other Loan Documents.

 

9.2         Maintenance of Location and Office.  Each Borrower and each Guarantor will
maintain (i) its jurisdiction of formation in Delaware, and its chief
executive office in New York, New York, or at such other jurisdiction or place
in the United States as such Borrower or Guarantor shall designate by not less
than thirty (30) days prior written notice to the Administrative Agent.

 

60

 

9.3   Organizational Number. 
Neither  Borrower, nor any
Guarantor or Pledged Entity, will change its organizational number or taxpayer
identification number, except upon thirty (30) days prior written notice to the
Administrative Agent.

 

9.4   Records and Accounts. 
Each Borrower and each Guarantor will keep, and cause each of their
respective Subsidiaries to keep, true and accurate records and books of account
in which full, true and correct entries will be made in accordance with GAAP.

 

9.5   Delivery of Financial Statements and Notices.

 

9.5.1        Financial Statements, Reports, Etc.  Each Borrower, EIT, CMC and Centerline
Investors will furnish to the Administrative Agent (either physically or
through electronic delivery reasonably acceptable to the Administrative Agent,
which shall promptly furnish to each Lender):

 

(a)           within ninety (90) days
after the end of each Fiscal Year with respect to CHC, and within one hundred
five (105) days after the end of each Fiscal Year with respect to each other
such Person, its consolidated balance sheet, income statement, statement of
equity and cash flow statement, and, with respect to CCG and Centerline
Investors, consolidating balance sheet and related statement of income showing
the financial condition of such Person and its consolidated Subsidiaries as of
the close of such Fiscal Year and the results of its operations and the
operations of such Subsidiaries during such year, together with comparative
figures for the immediately preceding Fiscal Year.  Such balance sheets and related statements
for the Borrowers, EIT, CMC and Centerline Investors shall be audited by
Deloitte & Touche LLP or other independent public accountants of
recognized national standing reasonably acceptable to the Administrative Agent,
and shall be accompanied by an opinion of such accountants (which opinion shall
not be qualified in any material respect), to the effect that such consolidated
financial statements fairly present the financial condition and results of
operations of such Person and its consolidated Subsidiaries on a consolidated
basis in accordance with GAAP consistently applied;

 

(b)           within forty-five (45)
days with respect to CHC and within sixty (60) days with respect to CCG, EIT,
CMC and Centerline Investors, after the end of each of the first three Fiscal
Quarters of each fiscal year, each such Person’s consolidated balance sheet,
income statement, statement of equity and cash flow statement, and, with
respect to CCG and Centerline Investors, consolidating balance sheet and
related statement of income showing the financial condition of such Person and
its consolidated Subsidiaries as of the close of such Fiscal Quarter and the
results of its operations and the operations of such Subsidiaries during such
Fiscal Quarter and the then elapsed portion of the Fiscal Year, and comparative
figures for the same periods in the immediately preceding Fiscal Year, all
unaudited and certified by such Person’s chief financial officer as fairly
presenting the financial condition and results of operations of such Person and
its 

 

61

 

consolidated Subsidiaries on a consolidated (and, in
the case of CCG and Centerline Investors, a consolidating) basis in accordance
with GAAP consistently applied, subject to normal year-end audit adjustments;

 

(c)           concurrently with any
delivery of financial statements with respect to CHC under clause (a) or (b) above,
a certificate substantially in the form of Exhibit 9.5.1(c) (a
“Compliance Certificate”) of CHC’s chief financial officer opining and
certifying (i) that no Default has occurred or, if a Default has occurred,
specifying the nature and extent thereof and any corrective action taken or
proposed to be taken with respect thereto and (ii) setting forth
computations in reasonable detail satisfactory to the Administrative Agent
demonstrating compliance with the covenants contained in Section 9.18.1,
and Sections 10.14 through 10.16 and, (x) setting forth the
Borrowers’ calculation of Consolidated
EBITDA, Fixed Charges, Funded Debt and Net Proceeds, (y) certifying
that there has been no change in the business activities, assets or liabilities
of any Person reasonably likely to result in a Material Adverse Effect, or if
there has been any such change, describing such change in reasonable detail,
and, (z) certifying that the Borrowers and the Guarantors are in
compliance with Section 10.13;

 

(d)           promptly after the same
become publicly available, copies of all periodic and other reports, proxy
statements and other materials filed by such Persons with the SEC, or with any
national securities exchange, or distributed to its shareholders, partners or
members, as the case may be;

 

(e)           promptly after the
receipt thereof by any such Person or any Subsidiary, a copy of any “management
letter” received by any such Person from its certified public accountants, and
the management’s response thereto; and

 

(f)            promptly, from time to
time, such other information regarding the operations, business affairs and
financial condition of such Persons or any of their Subsidiaries, or compliance
with the terms of any Loan Document, as the Administrative Agent or any Lender
may reasonably request.

 

(g)           Documents required to be delivered pursuant to Section 9.5.1(a),
(b) or (d) (to the extent any such documents are
included in materials otherwise filed with the SEC) may be delivered
electronically and if so delivered, shall be deemed to have been delivered on
the date (i) on which such Person posts such documents, or provides a link
thereto, on such Person’s website on the internet; or (ii) on which such
documents are posted on such Person’s behalf on IntraLinks/IntraAgency or
another relevant website, if any, to which each Lender and the Administrative
Agent have access (whether a commercial, third-party website or whether
sponsored by the Administrative Agent).

 

9.5.2        Notices.  With reasonable promptness, but in all events
within five (5) Business Days after the Person described below has actual
knowledge thereof:

 

62

 

(a)           Defaults.  Each Borrower and each Guarantor will, and
will cause each of their respective Subsidiaries
to notify the Administrative Agent in writing of the occurrence of any act,
event or condition which constitutes a Default under any of the Loan Documents,
such notice to include a written statement of any remedial or curative actions
which such Person proposes to undertake to cure or remedy any such Default
before it becomes an Event of Default.

 

(b)           Equity Collateral.  Each Borrower and each Guarantor will, and
will cause each of their respective Subsidiaries to, give notice to the
Administrative Agent in writing of any events relating to the Equity Collateral
that materially adversely affect the rights of the Administrative Agent or any
other Creditor Parties with respect thereto.

 

(c)           Litigation.  Each Borrower and each Guarantor will, and
will cause each of their respective Subsidiaries
to, give notice to the Administrative Agent in writing of any litigation or
proceedings threatened or any pending litigation and proceedings affecting any
such Person involving an amount in controversy exceeding $2,000,000, or with respect to any of
the foregoing Persons, that could reasonably be expected to have a Material
Adverse Effect, and stating the nature and status of such litigation or
proceedings.  Each Borrower and each
Guarantor will, and will cause each of their respective Subsidiaries to, give
notice to the Administrative Agent in writing in form and detail reasonably
satisfactory to the Administrative Agent of any judgment in excess of $2,000,000 not covered by insurance,
final or otherwise, against such Persons. 
Notwithstanding the foregoing, the parties hereto agree that the
litigation listed on Schedule 8.2 shall be excluded from the notice provisions
of this Section.

 

(d)           Change in Credit Rating.  Each Borrower and each Guarantor will, and
will cause each of their respective Subsidiaries to, give notice to the
Administrative Agent in writing of any change
in any such Person’s credit rating, or the credit rating pertaining to any debt
obligations of any such Person, as determined by Moody’s, S&P or any other
nationally recognized rating service from time to time.

 

(e)           Management.  The Borrowers and Guarantors will provide to
the Administrative Agent prompt notice in the event the relationship of any of
their respective officers or other members of senior management will be
terminating.

 

(f)            Material Adverse Change.  Each Borrower and each Guarantor will, and
will cause each of its
Subsidiaries to, give notice to the Administrative Agent in writing of any
events or circumstances that are reasonably likely to cause a Material Adverse
Effect.

 

(g)           Notice to Lenders.  The Administrative Agent will promptly
furnish to each Lender a copy of each notice received by the Administrative
Agent under this Section 9.5.2.

 

63

 

9.5.3        True, Accurate and Complete Financial Statements.  All financial statements furnished hereunder
shall be true, accurate and complete in all material respects and shall fairly
present in all material respects the financial condition of such Persons as of
the date thereof.

 

9.5.4        Revisions to Schedule 8.5.2.  The Borrowers and Guarantors shall provide
from time to time all information as the Administrative Agent may reasonably
request regarding any Subsidiaries listed on Schedule 8.5.2; provided,
however, that, with respect to proprietary or confidential information
that may be requested from time to time, the confidentiality of any such information
shall be maintained in accordance with the terms of Section 25.

 

9.6   Existence; Conduct of Business.

 

9.6.1        Statutory Trusts.  Each of the Borrowers, the Guarantors and the
Pledged Entities, if any, that are organized as statutory trusts (see Schedule
8.5.1) will (a) do or cause to be done all things necessary to
preserve and keep in full force and effect its existence as a Delaware
statutory trust, (b) preserve and keep in full force all of its rights and
franchises, except where such failure would not have a material adverse effect
on the business, assets or condition, financial or otherwise, of such Person,
and (c) only engage in Permitted Businesses and as contemplated by its
Governing Documents.

 

9.6.2        Corporations.  Each of the Borrowers, the Guarantors and the
Pledged Entities, if any, that are organized as corporations (see Schedule
8.5.1) will (a) do or cause to be done all things necessary to
preserve and keep in full force and effect its existence as a Delaware
corporation, (b) preserve and keep in full force all of its rights and
franchises, except where such failure would not have a material adverse effect
on the respective business, assets or condition, financial or otherwise, of
such Person, and (c) only engage in Permitted Businesses and as
contemplated by its Governing Documents.

 

9.6.3        Limited Liability Companies.  Each of the Borrowers, the Guarantors and the
Pledged Entities, if any, that are organized as limited liability companies
(see Schedule 8.5.1) will (a) do or cause to be done all things
necessary to preserve and keep in full force and effect such Person’s existence
as a Delaware limited liability company, (b) preserve and keep in full
force all of such Person’s rights and franchises, except where such failure
would not have a material adverse effect on the business, assets or condition,
financial or otherwise, of such Person, and (c) only engage in Permitted
Businesses and as contemplated by such Person’s Governing Documents.

 

64

 

9.7   Insurance.  Each of
the Borrowers, each of the Guarantors, each of the Pledged Entities and their
respective Subsidiaries shall maintain with respect to its business operations,
and shall cause each of their respective Subsidiaries to maintain, with
financially sound and reputable insurers, insurance with respect to such
properties and its business against such casualties, liabilities and
contingencies as shall be in accordance with the general practices of
reasonably prudent businesses engaged in similar activities in similar
geographic areas and in amounts, containing such terms, in such forms, covering
such risks and for such periods as may be reasonably acceptable to the
Administrative Agent.  At the Administrative
Agent’s request from time to time, the Borrowers and Guarantors shall provide a
comprehensive or partial list (as requested) of all such policies and true,
correct and complete copies of some or all such policies, as may be requested.

 

9.8   Taxes and Trade Debt. 
The Borrowers and each Guarantor and Pledged Entity will, and will cause
each of their Subsidiaries to, duly pay and discharge, or cause to be paid and
discharged, before the same shall become overdue, all Taxes imposed upon it and
its real properties, sales and activities, or any part thereof, or upon the
income or profits therefrom, except for those Taxes which any such Person is
contesting in good faith by appropriate proceedings and with respect to which
appropriate reserves have been established and are being maintained in accordance
with GAAP.

 

9.9   Compliance with Laws, Contracts, Licenses, and Permits.  Each Borrower, each Guarantor and each
Pledged Entity will, and will cause each of their respective Subsidiaries to,
comply with (a) all applicable legal requirements now or hereafter in
effect wherever its business is conducted, (b) the provisions of its
Governing Documents, and (c) all of its Contractual Obligations (except
during any period where such compliance is not permitted by the terms of this
Credit Agreement), except to the extent the failure to comply with any of the
foregoing would not be reasonably expected to result in a Material Adverse
Effect.  If at any time while any
Obligation is outstanding, any authorization, consent, permit or license from
any Governmental Authority, or other third party consents, approvals, or
notifications, shall become necessary or required in order that any such Person
may fulfill any of its respective Obligations under any of the Loan Documents,
such Person will promptly take or cause to be taken all reasonable steps within
its respective power to obtain such authorization, consent, permit or license,
or other third party consents, and to provide such notifications, and furnish
the Administrative Agent with evidence thereof.

 

9.10      Indemnification Against Payment of Brokers’ Fees.  Each Borrower and each Guarantor agrees to
defend, indemnify and hold harmless the Administrative Agent and each other
Creditor Party from and against any and all liabilities, damages, penalties,
costs, and expenses, relating in any manner to any brokerage or finder’s fees
in respect of the Loans (except as resulting from any arrangements or
agreements made with any broker or finder by the Administrative Agent or
another Creditor Party).

 

65

 

9.11      Fiscal Year.  The fiscal year of each Borrower and each
Guarantor (and each of their Subsidiaries) presently ends on December 31
of each year.  If any of the Borrowers,
the Guarantors or their Subsidiaries shall change their fiscal year end, such
Person shall promptly furnish the Administrative Agent with thirty (30) days
prior written notice thereof.

 

9.12      Place for Records; Inspection.  The Borrowers, the Guarantors and the Pledged
Entities shall maintain all of their business records at the address specified
in Section 18.  Upon
reasonable notice and at reasonable times during normal business hours, the
Administrative Agent and, during such time as there is outstanding any Default,
each Lender shall have the right to examine each Borrower’s, each of the
Guarantor’s, and each Pledged Entity’s property and make copies of and
abstracts from each such Person’s books of account, correspondence and other
records and to discuss their respective financial and other affairs with any of
their respective senior officers and any accountants hired by any such Person,
it being agreed that the Administrative Agent and each Lender receiving any
such information shall hold such information in confidence in accordance with
the provisions of Section 25. 
Any transferee of any portion of the Loans or any holder of a
participation interest in the Loans shall be entitled to deal with such
information in the same manner and in connection with any subsequent transfer of
its interest in the Loans or of further participation interests therein; provided,
however, that the Administrative Agent, or any Lender, transferee,
holder or participant shall be bound by the confidentiality provisions of Section 25.

 

9.13      Replacement Documentation.  Upon receipt of an affidavit of  an officer of the Administrative Agent or a
Lender as to the loss, theft, destruction or mutilation of any Note, or as to
any other Loan Document which is not of public record, and, in the case of any
such loss, theft, destruction or mutilation, upon surrender and cancellation of
such Note or other Loan Document, each Borrower and each Guarantor will
promptly issue, in lieu thereof, a replacement Note or other Loan Document
which shall be, as applicable, in the same principal amount thereof and
otherwise of like tenor.

 

9.14      Further Assurances.  Each Borrower and each Guarantor will
cooperate with, and will cause each of its Subsidiaries to cooperate with, the
Administrative Agent and execute such further instruments and documents as the
Administrative Agent shall reasonably request to carry out to the
Administrative Agent’s reasonable satisfaction the transactions contemplated by
this Credit Agreement and the other Loan Documents.

 

9.15      Guaranties.  Each of the Guarantors shall at all times
comply with the terms and conditions of its respective Guaranty.

 

9.16      Additional Information.  Without derogating the Borrowers’ obligations
hereunder, and each Guarantor’s obligations pursuant hereto and to its
respective Guaranties, each Borrower and each Guarantor will promptly supply
the Administrative Agent with such additional information relating to this
Credit 

 

66

 

Agreement and the other Loan Documents and the
performance of the Obligations contemplated hereby and thereby as the
Administrative Agent may hereafter reasonably request from time to time.

 

9.17      Exchange Listing.  CHC shall maintain at least one class of its
common shares having trading privileges on the New York Stock Exchange, the American
Stock Exchange or another nationally recognized exchange acceptable to the
Administrative Agent and the Required Lenders.

 

9.18      Consolidated EBITDA Covenant; Additional Guarantors
and Pledged Entities.

 

9.18.1      Consolidated EBITDA  Covenant.  The Borrowers and Guarantors shall cause the Consolidated EBITDA generated in the
aggregate by the Borrowers, the Guarantors (other than CCC), and the Pledged
Entities (excluding Consolidated EBITDA
generated by CFin Holdings) to comprise at least 90% of the Consolidated
EBITDA of CHC on a consolidated basis (excluding Consolidated EBITDA generated by CFin Holdings) (the “Consolidated EBITDA Covenant”).

 

9.18.2      Additional Guarantors or Pledged Entities.  Unless there exists a Valid Business
Impediment, the Borrowers and the Guarantors shall cause additional Persons
which are Subsidiaries of a Borrower or a Guarantor to become Guarantors from
time to time so as to assure compliance with the Consolidated EBITDA  Covenant.  In the event that there exists a Valid Business
Impediment to such a Person becoming a Guarantor hereunder, the Borrowers and
the Guarantors shall cause the holders of all the Capital Stock of such Person
to be pledged to the Administrative Agent in order for such Person to become a
Pledged Entity.

 

9.19      EIT Preferred Shares Covenants.  EIT shall maintain, with no material
modifications (after any modifications to occur on the Closing Date), all
covenants applicable to and binding upon EIT Preferred Shares.

 

9.20      Ownership of CCG, Guarantors and Pledged Entities.

 

(a)           Holding Trust shall
hold at all times, beneficially and of record, 100% of the EIT Common Shares
and voting control of EIT, on a fully diluted basis, assuming the conversion of
all convertible securities, the granting of all authorized options and equity
awards and the exercise of all options, warrants, subscription rights,
preemptive rights and other similar rights.

 

(b)           Holding Trust and EIT
shall not issue any additional Capital Stock or any rights or instruments
convertible into Capital Stock, other than issuances of EIT Preferred Shares.

 

(c)           CHC shall hold at all
times, beneficially and of record, (i) all of the Capital Stock of CCG, (ii) all
of the Capital Stock of Centerline/AC, and (iii) 

 

67

 

100% of the Common Shares of Beneficial Interest of
Holding Trust (as defined in the Governing Documents of Holding Trust).

 

(d)           Centerline/AC shall
hold at all times, beneficially and of record, 100% of the “Common Units” of
Centerline Investors (as defined in Centerline Investors’ Governing Documents).

 

(e)           Centerline Investors
shall hold at all times, beneficially and of record, 99.99% of the Capital
Stock of Centerline REIT Inc.

 

(f)            Centerline REIT Inc.
shall hold at all times, beneficially and of record, all of the Capital Stock
of (i) ARCap 2004-RR3 Resecuritization, Inc. and (ii) ARCap
2005-RR5 Resecuritization, Inc.

 

(g)           CCG shall hold at all
times, beneficially and of record, (i) all of the Common Units of CCC (as
defined in the Governing Documents of CCC), (ii) 1% of the Capital Stock
of CAHA, (iii) all of the Capital Stock of CMC, (iv) all of the
Capital Stock of Centerline Finance Corporation, (v) all of the Capital
Stock of Credit
Management, (vi) all of the Capital Stock of CM Investor LLC, and (vii) all
of the Capital Stock of Centerline Servicing, Inc.

 

(h)           CCC shall hold at all
times, beneficially and of record, 99% of the Capital Stock of CAHA.

 

(i)            CCG shall maintain at
all times direct ownership of at least 30% of the voting and common equity
interests in the Capital Stock of CFin Holdings.

 

(j)            CFin Holdings shall
maintain at all times direct ownership of 100% of the voting and common equity
interests in the Capital Stock of CFin.

 

(k)           CAHA shall hold at all times,
beneficially and of record, 49% of the Capital Stock of Centerline Investor LP.

 

(l)            Centerline Holdings LLC shall hold at all
times, beneficially and of record, 51% of Centerline Investor LP, and 100% of
Centerline Investor LP II.

 

9.21      Blizzard.  CHC shall, and shall cause any of its
Subsidiaries, to satisfy the Blizzard Covenant.

 

9.22       Payment of Deferred Fees. 
Provided that the Unfunded Escrow has been reduced to zero Dollars and
there is not then outstanding any Default, the Deferred Fees may be paid from
time to time from (a) Loans made available due to any incremental increase
in the Revolving Credit Limit or the Term Loan Limit from and after the date
hereof in accordance with the definitions of such terms, or (b) the
proceeds of the issuance by CHC after the date hereof of convertible preferred
Capital Stock.  Provided that there is
not then outstanding any Default, and provided further that making such payment
will not cause a breach of Section 10.15, interest accruing on the
Deferred Fees, at a rate, and upon terms, that are 

 

68

 

commercially reasonable, may
be paid from funds generated from the Borrowers’ operations that are available
from time to time.

 

9.23      Unfunded Escrow.  Until such time as the
Unfunded Escrow is reduced to zero Dollars, portions of the Unfunded Escrow
shall be funded ( thus permanently reducing the Unfunded Escrow) from time to
time from (a) Loans made available due to any incremental increase in the
Revolving Credit Limit from and after the date hereof in accordance with the
definition of such term, (b) Loans made available due to any incremental
increase in the Term Loan Limit from and after the date hereof in accordance
with the definition of such term, (c) any funds that would have otherwise
been released from the Bond Stabilization Escrow Account that are required to
be used to fund the Unfunded Escrow in accordance with the terms of the
Stabilization Escrow Agreement, (d) funds made available due to CHC’s
issuance of convertible preferred Capital Stock after the date hereof, and (e) interest
accrued and payable from time to time on the then outstanding principal balance
in the Bond Stabilization Escrow Account.

 

9.24      Revolving Loan/Term Loan True Up.  At such time as the Unfunded Escrow is
reduced to zero Dollars and the Deferred Fees have been fully paid, the
Borrowers shall pay down the then outstanding principal balance of the Term
Loan in an amount equal to X minus Y (but not less than zero).  For purposes of this Section, X shall equal
the amount used to fund the Unfunded Escrow pursuant to clauses (c) and
(e) of Section 9.23. 
For purposes of this Section, Y shall equal $300,000,000 minus the then
applicable Revolving Credit Limit.

 

10.       NEGATIVE
COVENANTS; FINANCIAL COVENANTS

 

For so long as this Credit Agreement is in
effect, and until such time as all of the Obligations have been indefeasibly
fully paid and performed, unless the Creditor Parties shall otherwise consent
to the extent and in the manner set forth in Section 23, the Borrowers
and the Guarantors shall comply, jointly and severally, with the following
covenants:

 

10.1      Liens. 
The Borrowers and Guarantors shall not create, incur or assume, and they
shall not permit or suffer any Pledged Entity creating, incurring or assuming,
any Lien upon or with respect to any of such Person’s assets, including,
without limitation, any Capital Stock, except (collectively, “Permitted Liens”):

 

10.1.1      Affordable Housing Syndications.  Liens on Capital Stock in Affiliates that own
multi-family affordable housing projects granted by such Persons to secure
capital contribution obligations, or Liens granted by such Affiliates, in the
ordinary course of CHC’s Subsidiaries’ multi-family affordable housing
business;

 

10.1.2      Governmental Charges.  Liens or charges for current Taxes which are
not delinquent or which remain payable without penalty, or the validity of
which is being contested in good faith by appropriate proceedings upon stay of
execution of the enforcement thereof; provided the obligor with 

 

69

 

respect thereto shall have set aside on its books and
shall maintain adequate reserves for their payment in conformity with GAAP;

 

10.1.3      Liens Contemplated Hereby.  Liens in favor of the Administrative Agent,
on behalf of the Lenders, pursuant to and as contemplated by the terms hereof
and by the terms of the other Loan Documents;

 

10.1.4      Warehouse Lines.  Liens pursuant to any mortgage warehouse line
of credit (provided that (i) no Lien in connection with any
mortgage warehouse line of credit gives rise to any interest in any of the
Collateral, and (ii) underlying mortgage loans made under such warehouse
lines shall be entered into pursuant to unconditional purchase commitments
(subject to program deliverable and other requirements arising in the ordinary
course of business consistent with past practices) from Fannie Mae or Freddie
Mac, or other investors acceptable to the Required Lenders in their reasonable
discretion, on terms and conditions consistent with the mortgage warehouse line
of credit utilized by CMC on the date hereof);

 

10.1.5      Existing Liens.  Liens existing on the date hereof and listed
on Schedule 8.3 and any renewals or extensions thereof; provided
that (i) the property covered thereby is not changed, (ii) the amount
secured or benefited thereby is not increased, (iii) the direct or any
contingent obligor with respect thereto is not changed, and (iv) any
renewal or extension of the obligations secured or benefited thereby is
permitted by Section 10.3;

 

10.1.6      Mechanics Liens, etc. 
Landlords’, carriers’, warehousemen’s, mechanics’, materialmen’s,
repairmen’s or other like statutory Liens arising in the ordinary course of
business which are not overdue for a period of more than thirty (30) days or
which are being contested in good faith and by appropriate proceedings
diligently conducted, if adequate reserves with respect thereto are maintained
on the books of the applicable Person;

 

10.1.7      Pledges & Deposits.  Liens (including pledges and deposits)
incurred in the ordinary course of business in connection with workers’
compensation, unemployment insurance and other social security legislation,
other than any Lien imposed by ERISA;

 

10.1.8      Bids. 
Liens (including pledges and deposits) incurred to secure the
performance of bids, trade contracts, tenders, and leases (other than
Indebtedness), statutory obligations, surety and appeal bonds, performance
bonds and other obligations of a like nature incurred in the ordinary course of
business;

 

10.1.9         Easements.  Easements, rights-of-way, restrictions,
reservations, covenants, conditions, encroachments, other minor defects or
irregularities of title, and other similar encumbrances affecting real 

 

70

 

property which, in the aggregate, are not substantial
in amount, and which do not in any case materially detract from the value of
the property subject thereto or materially interfere with the ordinary conduct
of the business of the applicable Person;

 

10.1.10       Judgments.  Liens securing judgments for the payment of
money not constituting an Event of Default under Section 11.1.7;

 

10.1.11       Purchase Money.  Liens securing Indebtedness permitted under Section 10.3.1(e);
provided that (i) such Liens do not at any time encumber any
property other than the property financed by such Indebtedness and (ii) the
Indebtedness secured thereby does not exceed the cost or fair market value,
whichever is lower, of the property being acquired on the date of acquisition;

 

10.1.12       Precautionary UCC Financing Statements.  The interest of a lessor under Liens arising
from precautionary UCC financing statement filings regarding leases (other than
Indebtedness) entered into by such Persons in the ordinary course of business;

 

10.1.13       Bankers’ Liens.  Liens that are contractual or statutory
set-off rights arising in the ordinary course of business with financial
institutions or bankers’ Liens on deposits of cash in favor of banks or other
depository institutions, solely to the extent incurred in connection with the
maintenance of such deposit accounts in the ordinary course of business;

 

10.1.14       Licenses.  Any interest or title of a licensor, lessor
or sublessor under any license or lease agreement pursuant to which rights are
granted to such Persons;

 

10.1.15       Public
Utilities.  Deposits or
pledges in favor of public or private utility companies arising in the ordinary
course of business and not out of any extraordinary transaction;

 

10.1.16       Debt Liens.  Liens on the property of any Borrower,
Guarantor or Pledged Entity securing secured Indebtedness permitted pursuant to
clauses (f), (j), (k), (l), (m), (q) or (r) of Section 10.3,
solely if and to the extent that Indebtedness so secured is Permitted
Indebtedness with respect to the Borrower, Guarantor or Pledged Entity granting
such lien; and

 

10.1.17       Bond Transaction and Future Bond Transactions.  (i) Liens of Freddie Mac in connection
with the Bond Transaction and (ii) Liens of Freddie Mac or any other
credit enhancer approved by the Required Lenders in connection with any Future
Bond Transaction.

 

71

 

10.2      Double Negative Pledge.

 

10.2.1      Negative Pledge.  CCG shall not grant, create, or suffer to be
granted or created, any Lien on the Capital Stock directly or indirectly held
by it of CFin Holdings, CMC or CMP

 

10.2.2      Double Negative Pledge.  Other than pursuant to the terms of this
Credit Agreement, in no event shall CCG agree with, or become obligated to, any
other Person to refrain from granting or creating a Lien on the Capital Stock
of CFin Holdings, CMC or CMP

 

10.3      Indebtedness.  The Borrowers and Guarantors shall not incur,
assume or become obligated with respect to, or permit or suffer any Pledged
Entity incurring, assuming or becoming obligated with respect to, directly or
indirectly, any Indebtedness (on a consolidated and individual basis) except
the following (collectively, “Permitted Indebtedness”):

 

10.3.1      Types of Permitted Indebtedness and Persons to whom
they Apply:  Set forth
below is a list of each type of Permitted Indebtedness with a listing regarding
which entities may incur, without duplication, the particular type of Permitted
Indebtedness:

 

(a)           Indebtedness for
borrowed money existing on the date of this Credit Agreement, listed and
described, but only to the extent so listed and described and only with respect
to the Person disclosed to be liable with respect to each specific
Indebtedness, on Schedule 10.3.1 and any replacements, renewals or
extensions thereof; provided, however, that any such
replacements, renewals or extensions shall be obligations of the same Borrower,
Guarantor or Pledged Entity, as the case may be, on substantially similar terms
and conditions (other than terms relating to pricing) and shall be entered into
in the ordinary course of business consistent with past practices;

 

(b)           The Borrowers, the
Guarantors and the Pledged Entities may incur Indebtedness for Taxes to the
extent that payment thereof shall at the time not be required to be made in
accordance with Section 9.8;

 

(c)           Each of the Borrowers,
the Guarantors and the Pledged Entities may incur Indebtedness, to the extent
that such Person has generally incurred such Indebtedness in the ordinary
course of business consistent with past practices, on open account incurred by
any such Person for the purchase price of services, materials and supplies (not
as a result of borrowing), so long as all of such open account Indebtedness
shall be promptly paid and discharged when due or in conformity with customary
trade terms and practices, except for any such open account Indebtedness which
is being contested in good faith by such Person and as to which adequate
reserves required by GAAP have been established and are being maintained and as
to which no Lien has been placed on any property of such Person;

 

72

 

(d)           The Borrowers, the
Guarantors and the Pledged Entities may incur Indebtedness consisting of
obligations owed by a Borrower, Guarantor or a Pledged Entity to any of their
respective Affiliates; provided, however, that if any such
Affiliate is not a Borrower or a Guarantor, such Indebtedness must be
subordinated to the Obligations in accordance with the Intercompany
Subordination Agreement upon terms and conditions satisfactory to the
Administrative Agent (other than such
Indebtedness arising out of transactions between or among one or more members
of The Related Companies Group, on the one hand, and the Centerline Group, on
the other hand, entered into in the ordinary course of business upon terms and
conditions no less advantageous to the Centerline Group than would be available
on an arm’s length basis with a Person who is not an Affiliate);

 

(e)           Each of CHC, CCG, CAHA,
Centerline REIT Inc., Centerline Servicing Inc., CFin Holdings, Centerline/AC,
CMC and CMP may incur Indebtedness in respect of capital leases and purchase
money obligations for fixed or capital assets within the limitations set forth
in Section 10.1.12; provided, however, that the aggregate
amount of all such Indebtedness at any one time outstanding shall not exceed $5,000,000;

 

(f)            Each of the Borrowers,
Centerline Investor LP, Centerline Investor LP II, Centerline REIT Inc.,
Centerline Finance Corporation, Centerline CLO Ltd. 2007-1 (in the event that
such Person becomes a Guarantor or a Pledged Entity pursuant to Section 9.18.2),
and Holding Trust may incur Indebtedness on a non-recourse basis (i.e. where
the creditor has recourse against the debtor only to the extent of and with respect
to specific assets financed by such Indebtedness, and on account of fraud and
other enumerated bad acts);

 

(g)           Each of the Borrowers,
the Guarantors and the Pledged Entities shall be jointly and severally liable
for and may incur the Obligations;

 

(h)           Each of the Borrowers,
the Guarantors and the Pledged Entities may incur Indebtedness consisting of
cash management charges, or arising out of ACH services, in each case incurred
in the ordinary course of business consistent with such entity’s past practices;

 

(i)            Each of CMC and CMP
may incur Indebtedness in respect of mortgage warehouse lines of credit; provided
that underlying mortgage loans made under such warehouse lines shall be entered
into pursuant to unconditional purchase commitments from Fannie Mae or Freddie
Mac, or other investors acceptable to the Required Lenders in their reasonable
discretion, on terms and conditions consistent with the mortgage warehouse line
of credit utilized by CMC on the date hereof;

 

(j)            Each of Centerline
Investor LP, Centerline Investor LP II, and CAHA may incur Indebtedness in
respect of low income housing tax credit lines 

 

73

 

of credit; provided that the principal amount
of such lines of credit shall result in a reduction in the Revolving Credit
Limit on a dollar for dollar basis;

 

(k)           Each of CFin Holdings
and Holding Trust may incur Indebtedness in respect of bond warehouse lines of
credit; provided that underlying bonds warehoused thereon shall be
issued pursuant to purchase commitments from investors acceptable to the
Required Lenders in their reasonable discretion;

 

(l)            Each of the Borrowers,
the Guarantors and the Pledged Entities may incur Indebtedness which may be
deemed to exist pursuant to any guaranties of leases incurred in the ordinary
course of business consistent with past practices for such Person undertaking
such Indebtedness;

 

(m)          Each new direct or
indirect Subsidiary becoming a Guarantor or Pledged Entity after the date
hereof may be liable for any Indebtedness that (i) exists at the time such
Person becomes a Subsidiary and is not created in contemplation of or in
connection with such Person becoming a Subsidiary and (ii) the aggregate
principal amount of Indebtedness permitted by this clause shall not exceed
$7,000,000 at any one time outstanding;

 

(n)           Each of the Borrowers
may incur Indebtedness consisting of unsecured promissory notes issued to
current or former directors, consultants, managers, officer and employees or
their spouses or estates of any of its Subsidiaries to purchase or redeem
Capital Stock of CHC (other than any more than a de minimus amount of such
Indebtedness on account of SCI’s, SCU’s and SMU’s), issued to such director,
consultants, manager, officer or employee in the ordinary course of business
consistent with past practices for such Person undertaking such Indebtedness;

 

(o)           Each of CHC, CCG, CAHA,
Centerline REIT Inc., Centerline Servicing Inc., CFin Holdings, Centerline/AC,
CMC, CMP and Centerline Finance Corporation may incur Indebtedness in respect
of workers’ compensation claims, performance bonds, leases and completion
guarantees provided by such Person in the ordinary course of its business;

 

(p)           Each of the Borrowers
may incur Unsecured Indebtedness consisting of incentive, non-compete,
consulting, deferred compensation, employment, or other similar arrangements or
co-investment programs for employees, entered in the ordinary course of
business consistent with past practices;

 

(q)           Each of Holding Trust,
SPV I, SPV II and, to the extent not included as a Risk-Adjusted
Contingent Liability, CHC,may incur Indebtedness in connection with the Bond
Transaction and any Future Bond Transaction;

 

(r)            SPV I and, to the
extent not included as a Risk-Adjusted Contingent Liability, the Borrowers, may
incur Indebtedness in connection with any financing or monetization of the B
Bond, provided, however, that any 

 

74

 

proceeds from any such transaction shall be applied to
pay Obligations relating to the Term Loan pursuant to Section 4.2.3;

 

(s)           Each of the Borrowers
may incur (i) Risk-Adjusted Contingent Liabilities not to exceed in the
aggregate $350,000,000 and (ii) additional
Risk-Adjusted Contingent Liabilities which are included in the full face
amount thereof in the definition of Funded Debt;

 

(t)            Each of the Borrowers
and Centerline REIT Inc. may incur Indebtedness pursuant to Derivative
Agreements in the ordinary course of business and not for speculation; and

 

(u)           CFin Holdings may incur
Indebtedness pursuant to back-up yield guaranties in connection with yield
guaranteed low income housing tax credit investment funds in the ordinary
course of business consistent with past practices.

 

10.3.2      CHC. 
CHC may incur, without duplication:

 

(a)           Indebtedness incurred
in the ordinary course of business similar to CHC’s existing securitization
programs, or any similar secured financing program, or other securitization
programs upon terms and conditions consistent with the market for such programs,
but not incurred through the borrowing of money;

 

(b)           Indebtedness to Fannie
Mae, Freddie Mac, GNMA, FHA or other parties with whom CHC or its Subsidiaries
originate, sell, repurchase or service mortgage loans, to the extent directly
relating to or arising out of such origination, sale, repurchase, or servicing
in the ordinary course of business;

 

(c)           Indebtedness secured by
real property acquired upon foreclosure of mortgages, to the extent directly
related to such real property, not in excess of the fair market value thereof,
and reasonably expected by CHC to be recovered from the sale or other
disposition of the subject real property;

 

10.3.3      The Borrowers.  The
Borrowers may incur, without duplication:

 

(a)           Each of the Borrowers may incur Senior Unsecured
Indebtedness not to exceed $125,000,000 in aggregate principal face amount; and

 

(b)           Each of the Borrowers
may incur Subordinated Debt.

 

10.3.4      CCG.  CCG may incur, without
duplication:

 

(a)           Indebtedness arising
out of preferred or structured debt or equity which shall be subordinated to
the Loans upon terms and conditions satisfactory to the Administrative Agent;
and

 

75

 

(b)           Indebtedness arising
out of counterparty-type exposure relating to guaranteed tax credit funds.

 

10.3.5      Centerline Investors.  Each of Centerline Investors and its
Subsidiaries, without duplication, may incur non-recourse repurchase
arrangements, in each case entered into in the ordinary course of business
consistent with past practices.

 

10.3.6      EIT. 
EIT may incur Indebtedness to the extent permitted under Section 9.19.

 

10.4      Merger; Ownership Interests; Sale of Assets.  The Borrowers and Guarantors shall not, and
shall not permit or suffer any of the Pledged Entities to, with respect to each
such Person:

 

10.4.1      Mergers, Consolidations and Asset Sales.  Merge into or consolidate with any other
Person, or permit any other Person to merge into or consolidate with it, or
sell, transfer, lease or otherwise dispose of (in one transaction or in a
series of transactions) all or substantially all of the assets (whether now
owned or hereafter acquired) of such Person, except that, provided that there
is not then in existence any Event of Default and no Event of Default will
occur as a result of such a transaction, any of the Borrowers, the Guarantors
or the Pledged Entities may enter into a merger or consolidation in which such
Person is the surviving entity.

 

10.4.2      Other Asset Transfers.  The Borrowers and the Guarantors shall not
effect, and shall not permit or suffer the Pledged Entities effecting, any
sale, disposition, contribution or other transfer of their respective tangible
or intangible assets other than (a) in connection with securitizations and
other transactions consummated in the ordinary course of business consistent
with past practices, including without limitation, in connection with the Bond
Transaction or any Future Bond Transaction; (b) sales, dispositions,
contributions or other transfers to other entities included among the
Borrowers, the Guarantors and the Pledged Entities; (c) sales generating
Asset Sale Proceeds applied to prepay the Loans in accordance with the terms of
Section 4.2.2; and (d) CCG may sell the Capital Stock of CFin
Holdings, provided CCG retains at least 30% of the Capital Stock of CFin
Holdings.

 

10.5      Loans, Guarantees and Investments.  The Borrowers and Guarantors will not make,
and will not permit or suffer any of the Pledged Entities making, any loans,
advances or extensions of credit to any Person, or making any guaranty or
surety for any Person, except (a) in the ordinary course of business
consistent with past practices (including, without limitation, entering into
joint ventures), (b) advances to the Borrowers’, the Guarantors’, the
Pledged Entities’ or their respective Subsidiaries’ employees in the ordinary
course of business for reasonable expenses 

 

76

 

to be incurred by such employees for the benefit of
such advancing Person, (c) advances to the Borrowers’, the Guarantors’,
the Pledged Entities’, or their respective Subsidiaries’ employees, directors
or individuals serving in similar capacities in connection with co-investment
programs in managed funds, to the extent such advances are permitted by applicable
law and to the extent such advances do not exceed in the aggregate at any time
outstanding $10,000,000 (such $10,000,000 limit to be reduced dollar
for dollar by the amount of any such advances that are forgiven rather than
repaid), (d) acquisitions within Permitted Businesses, (e) other
transactions expressly permitted by or contemplated under the terms of this
Credit Agreement, (f) investments in direct obligations of the United
States or of any state, United States federal agency obligations and commercial
paper designated as “prime” by the national credit office of Dun &
Bradstreet, and (g) CHC and CCG may incur Risk-Adjusted Contingent
Liabilities consistent with the terms of Section 10.3.2(b).

 

10.6      Distributions Prior to Default.  CHC shall make no Distributions so as to
cause the aggregate Distributions made by CHC, during the one year period
ending on the date of the most recent Distribution, to exceed 50% of CHC’s
Consolidated EBITDA for the four consecutive Fiscal Quarter period most recently
ended; provided, however, that (a) with respect to
Distributions made during the first calendar quarter following the date hereof
the amount of such Distributions shall be based on Distributions declared
during such quarter, rather than actually paid during such quarter, and the
amount of such Distrubutions declared times four shall not exceed 50% of CHC’s
Consolidated EBITDA for the four consecutive Fiscal Quarters then ended, (b) with
respect to Distributions made during the first two calendar quarters following
the date hereof such Distributions shall be based on the Distributions declared
during such two quarter period, rather than actually paid during such quarter,
and two times the amount of such Distributions actually declared during such
two quarter period shall not exceed 50% of CHC’s Consolidated EBITDA for the
four consecutive Fiscal Quarters then ended, (c) with respect to
Distributions made during the first three calendar quarters following the date
hereof such Distributions shall be based on Distributions declared during such
quarters, rather than actually paid during such quarters, and four thirds of
such Distribtutions declared shall not exceed 50% of CHC’s Consolidated EBITDA
for the four consecutive Fiscal Quarters then ended, and (d) with respect
to Distributions made during the first four calendar quarters following the
date hereof such Distributions shall be based on Distributions declared during
such quarters, rather than actually paid during such quarters, and such
Distribtutions declared shall not exceed 50% of CHC’s Consolidated EBITDA for
the four consecutive Fiscal Quarters then ended.

 

10.7      Distributions After Default.

 

10.7.1      CHC. 
CHC shall not make any Distributions so long as either (a) an Event
of Default has occurred and is continuing or would be caused by the making of
any such Distribution, or (b) a Default arising out of a breach of any of
Sections 9.1, 9.5, 9.20 or 10.14 through 10.16 has occurred and is 

 

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continuing or would be caused by the making of all or
any portion of such Distribution.

 

10.7.2      Guarantors and Pledged Entities.  So long as a Default has occurred and is
continuing or would be caused by the making of any Distributions, CCG, the
Guarantors and the Pledged Entities shall not make any Distributions to any
Persons other than to a Person that is a Borrower or a Guarantor.

 

10.7.3      Distributions. 
Notwithstanding any other terms of this Section 10.7, and
notwithstanding the existence of any Default, CHC may make, and cause its
Subsidiaries to make, Distributions to the holders of the EIT Preferred Shares
or the holders of any securities into which the EIT Preferred Shares are
converted if and to the extent that such Distributions are made solely out of
funds received from Freddie Mac as contemplated by the Bond Transaction.

 

10.8      Affiliate Indebtedness.  So long as a Default has occurred and is
continuing, no Borrower, Guarantor or Pledged Entity will make any payments to
any Affiliate that is not a Borrower or Guarantor on account of any
Indebtedness owed by such Person to such Affiliate, other than:  (a) reimbursements for the payment of
Taxes; (b) payments in order to cover operating expenses incurred in the
ordinary course of business, provided that such expenses are upon terms and
conditions no more favorable to such Affiliate than would be available in an
arms-length transaction between independent parties; and (c) payments to
The Related Companies Group on account of obligations incurred in the ordinary
course of business, provided that such expenses are upon terms and conditions
no more favorable to such Affiliate than would be available in an arms-length
transaction between independent parties.

 

10.9      Purchase of Margin Stock.  Except with the prior written consent of the
Administrative Agent, the Borrowers and the Guarantors shall not utilize and
shall not permit or suffer any other Person utilizing, any part of the proceeds
of the Loans to purchase or carry any margin stock (within the meaning of
Regulation U of the Board of Governors of the Federal Reserve System) or to
extend credit to others for the purpose of purchasing or carrying any such
margin stock.

 

10.10    Transactions with Affiliates.  Except 
as permitted by Section 10.1, or with the prior written
consent of the Administrative Agent, the Borrowers and the Guarantors shall not
enter, and shall not permit or suffer the Pledged Entities entering, into any
purchase, sale, lease or other transaction with an Affiliate (other than the
Borrowers, the Guarantors or the Pledged Entities), except in the ordinary
course of business on terms that are no less favorable to the Borrower,
Guarantor or Pledged Entity, as the case may be, than those that might be
obtained at the time in a comparable arm’s-length transaction with any Person
who is not an Affiliate.

 

10.11    Amendment to Governing Documents.  Except with the prior written consent of the
Administrative Agent, the Borrowers, Guarantors and Pledged Entities shall not 

 

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amend or agree with any Person to vary the terms of
any of their respective Governing Documents; provided, however,
that any such Person may enter into such amendments or agreements if such
change or amendment does not or will not adversely affect (a) the
liability, risk or rights of any Creditor Party under any of the Loan Documents
or in connection with any of the transactions contemplated hereby or thereby,
or (b) the status of such Person as an entity that would not be
substantively consolidated with any other of the Borrowers, the Guarantors or
the Pledged Entities in the event any of them is the debtor in any bankruptcy
proceeding.

 

10.12    Business Lines.  The
Borrowers and the Guarantors shall not engage, and shall not permit or suffer
any Pledged Entity engaging, in any business lines, other than their respective
lines of business as of the date of this Credit Agreement and such lines of
business reasonably related or ancillary thereto; and such Persons may also
engage in other lines of business relating or ancillary to real estate finance
and management and asset and fund management (collectively, “Permitted
Businesses”).

 

10.13    Competing Businesses. 
The Borrowers and the Guarantors will not create, own or operate, and
will not permit or suffer any Pledged Entity creating, owning or operating, any
operating business that would compete directly with a business which CHC or any
of its Subsidiaries operates or in which CHC or any of its Subsidiaries has any
interest, unless the Person pursuing such competing operating business becomes
a Guarantor (or, if there is a Valid Business Impediment to such Person
becoming a Guarantor, a Pledged Entity) upon terms and conditions acceptable to
the Administrative Agent.

 

10.14    Consolidated GAAP Net Worth.  Shareholders’ equity as set forth in the
financial statements of CHC in accordance with GAAP of greater than
$500,000,000 plus 75% of the net proceeds from any sale or issuance of CHC’s
Capital Stock to the extent included in shareholders’ equity.

 

10.15    Consolidated EBITDA to
Fixed Charges Ratio.  CHC shall
maintain at the end of each Fiscal Quarter for the four Fiscal Quarter period
then ending a ratio of Consolidated EBITDA to Fixed Charges equal to or greater
than 2.25 to 1.00.

 

10.16    Funded Debt to Consolidated
EBITDA Ratio.  CHC shall maintain a
ratio of Funded Debt to Consolidated EBITDA, for the four Fiscal Quarters then
ending, (a) equal to or less than 2.75 to 1.00 for each Fiscal Quarter
ending through December 31, 2008, and (b) equal to or less than 2.50
to 1.00 for each Fiscal Quarter ending on March 31, 2009 and thereafter.

 

10.17    Stock Buy-Backs.  No
Borrower, Guarantor, or Pledged Entity shall purchase or otherwise acquire for
any consideration its Capital Stock during the term of this Agreement (other
than pursuant to a transaction contemplated by Section 10.3.1(n)).

 

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11.       DEFAULT

 

11.1      Events of Default.  Each of the following events or
circumstances, unless cured within any applicable grace period set forth or
referred to below in this Section, shall constitute an “Event of Default”:

 

11.1.1      Failure to Pay.

 

(a)           The Borrowers shall
fail to pay any principal on any of the Loans as and when the same shall become
due and payable; or

 

(b)           The Borrowers shall
fail to pay any interest or any other Obligation under the Loans within five (5) days
of when the same is due and payable;

 

11.1.2      Failure to Perform.  Either Borrower or any Guarantor shall: (a) fail
to comply with any of its Negative Covenants and Financial Covenants or Section 9.18.1;
(b) fail to comply, within thirty (30) days after such Person receives
notice of such failure from the Administrative Agent or from any Lender, with
any of its other agreements and covenants contained herein which are not
otherwise referenced herein (such thirty day period to be extended at the
discretion of the Administrative Agent (but not beyond forty-five (45) days) if
such failure can be cured, the Borrowers and Guarantors have promptly commenced
and are diligently pursuing a cure and the Administrative Agent determines that
such extension is reasonably necessary in order to effect such a cure); or (c) fail
to comply with any of its other agreements, covenants, liabilities and
obligations contained in any of the other Loan Documents beyond any applicable
notice and grace periods;

 

11.1.3      Breach  of  Representation or
Warranty.  Any
representation or warranty of either Borrower or any Guarantor in this Credit
Agreement or any of the other Loan Documents shall have been false or
misleading in any material respect upon the date when made or deemed to have
been made or repeated;

 

11.1.4      Failure to Pay Other Indebtedness.  Either Borrower, any Guarantor or any Pledged
Entity shall be in default or breach of any recourse or non-recourse
obligations aggregating $10,000,000
or more, and the effect thereof is (i) to cause an acceleration, mandatory
redemption or other required repurchase of such obligations, or (ii) to
permit the holder(s) of such obligations to accelerate the maturity of any
such obligations or require a redemption or other repurchase of such
obligations; or any such obligations shall be otherwise declared to be due and
payable (by acceleration or otherwise) or required to be prepaid, redeemed or
otherwise repurchased (other than by a regularly scheduled required prepayment)
prior to the stated maturity thereof;

 

80

 

11.1.5      Insolvency.  Either Borrower, any Guarantor or any Pledged
Entity shall make an assignment for the benefit of creditors, or admit in
writing its inability to pay or generally fail to pay its debts as they mature
or become due, or shall petition or apply for the appointment of a trustee or
other custodian, liquidator or receiver of any such Person or of any
substantial part of any such Person’s assets or shall commence any case or
other proceeding relating to any such Person under any bankruptcy,
reorganization, arrangement, insolvency, readjustment of debt, dissolution or
liquidation or similar law of any jurisdiction, now or hereafter in effect, or
shall take any action to authorize or in furtherance of any of the foregoing,
or if any such petition or application shall be filed or any such case or other
proceeding shall be commenced against any such Person and any such Person shall
indicate its approval thereof, consent thereto or acquiescence therein;

 

11.1.6      Involuntary Proceedings.  (i) The filing of any case or other
proceeding against either Borrower, any Guarantor or any Pledged Entity under
any bankruptcy, reorganization, arrangement, insolvency, readjustment of debt,
dissolution or liquidation or similar law of any jurisdiction, now or hereafter
in effect and such case or proceeding is not controverted within twenty (20)
days and dismissed within sixty (60) days of its commencement; (ii) a
decree or order is entered appointing a trustee, custodian, liquidator or
receiver for any such Person, or adjudicating any such Person bankrupt or
insolvent, or approving a petition in any such case or other proceeding; or (iii) a
decree or order for relief is entered in respect of any such Person, in an
involuntary case under federal bankruptcy laws as now or hereafter constituted;

 

11.1.7      Judgments.  There shall remain in force, undischarged, unsatisfied,
unstayed or unvacated, or not bonded pending appeal, for more than ninety (90)
days, whether or not consecutive, any uninsured final judgment against either
Borrower, any Guarantor or any Pledged Entity that, with other outstanding
uninsured final judgments, undischarged, against such Persons in the aggregate
exceeds in the aggregate $10,000,000.00;

 

11.1.8      Cancellation of Loan Documents.  If any of the Loan Documents shall be
canceled, terminated, revoked or rescinded or any action at law, suit or in
equity or other legal proceeding to cancel, revoke or rescind any of the Loan
Documents shall be commenced by or on behalf of either Borrower, any Guarantor
or any Pledged Entity, or any court or any other governmental or regulatory
authority or agency of competent jurisdiction shall make a determination that,
or issue a judgment, order, decree or ruling to the effect that, any one or
more of the Loan Documents is illegal, invalid or unenforceable in accordance
with the terms thereof;

 

81

 

11.1.9      ERISA. 
There occurs one or more ERISA Events that individually or in the
aggregate results in or otherwise is associated with liability of any Borrower,
Guarantor, Pledged Entity or ERISA Affiliate in excess of $1,000,000 annually; provided, however,
that it shall be an Event of Default if there exists, as of any valuation date
for a Guaranteed Pension Plan, or in the aggregate for all Guaranteed Pension
Plans (excluding Guaranteed Pension Plans with assets in excess of benefit
liabilities) an excess of the actuarial present value (determined on the basis
of reasonable assumptions employed by the independent actuary for such plan) of
benefit liabilities (as defined in Section 4001(a)(16) of ERISA) over the
fair market value of the assets of such plan, only if such excess individually
or in the aggregate for all Guaranteed Pension Plans (excluding in such
computation any Guaranteed Pension Plans with assets greater than benefit
liabilities) exceeds $1,000,000
annually.

 

11.1.10       Indictment.  Either Borrower, any Guarantor or any Pledged
Entity shall be indicted for a federal crime, a punishment for which could
include the forfeiture of any assets of such Person; or

 

11.1.11       Material Adverse Change.  There shall have occurred any change in or to
the assets, liabilities, financial condition or business operations of either
Borrower, any Guarantor, any Pledged Entity or any of their Subsidiaries, taken
as a whole, which constitutes a Material Adverse Effect.

 

11.2      Remedies Upon Event of Default.

 

11.2.1      Accelerate Debt.  The Administrative Agent may, and with the
direction of the Required Lenders shall, declare the Obligations evidenced by
this Credit Agreement and the other Loan Documents immediately due and payable
and such date shall constitute the Revolver Maturity Date and the Term Loan
Maturity Date (provided that in the case of the occurrence of an event set
forth in Sections 11.1.5 and 11.1.6, such acceleration shall be
automatic); and

 

11.2.2      Pursue Remedies.  The Administrative Agent may, and with the
direction of the Required Lenders shall, pursue any and all remedies provided
for hereunder, or under any one or more of the other Loan Documents.  Except as expressly contemplated or permitted
by the terms of this Credit Agreement, each Lender may exercise setoff rights
as contemplated by, and pursuant to, Section 12 solely with the
consent of the Administrative Agent, but not otherwise.  Further, no Lender in its capacity as such,
may proceed to protect and enforce its rights by suit in equity, action at law
or other proceeding, whether for the specific performance of any covenant or
agreement contained in this Credit Agreement or the other Loan Documents or any
instrument pursuant to which the Obligations to such Lender are evidenced, or
otherwise proceed to enforce the payment 

 

82

 

thereof or exercise any other legal or equitable right
of such Lender, all such rights being delegated to the Administrative Agent in
accordance with the terms of this Credit Agreement.

 

11.2.3      Power of Attorney.  For the purpose of exercising the rights
granted by this Section, as well as any and all other rights and remedies of
the Administrative Agent or the Lenders, each of the Borrowers and each
Guarantor hereby irrevocably constitutes and appoints the Administrative Agent
(or any agent designated by the Administrative Agent) its true and lawful
attorney-in-fact, with full power of substitution, which appointment is coupled
with an intent, exercisable upon and during the continuance of any Event of
Default, to execute, acknowledge and deliver any instruments and to and perform
any acts in the name and on behalf of the Borrowers or any Guarantor.

 

11.3      Written Waivers.  If a Default is waived by the Administrative
Agent and/or any other Creditor Party, in accordance with the applicable
provisions of Section 23, in their sole discretion, pursuant to a
specific written instrument executed by an authorized officer of such Persons,
respectively, the Default so waived shall be deemed to have never occurred.

 

11.4      Allocation of Proceeds.  If an Event of Default shall have
occurred and be continuing and the Maturity Dates have been accelerated, all
payments received by the Administrative Agent under any of the Loan Documents,
in respect of any principal of or interest on the Obligations or any other
amounts payable by the Borrowers hereunder or thereunder, shall be applied in
the following order and priority:

 

(a)           amounts due to the Administrative Agent, in
its capacity as such, in respect of fees and expenses due under Section 14,
or otherwise due under this Credit Agreement and the other Loan Documents;

 

(b)           any amounts due the other Creditor Parties
pursuant to the terms of this Credit Agreement and the other Loan Documents
other than principal of or interest on the Loans;

 

(c)           payments of interest on the Loans to be
applied pro rata to each Lender and proportionately to the aggregate unpaid and
accrued interest on the Revolving Loans and the Term Loan respectively;

 

(d)           payments of principal of the Revolving Loans
and Term Loans, and any amounts due in respect of Derivative Agreements
relating to the Loans, to be applied pro rata to each Lender and
proportionately to the aggregate of such unpaid principal and amounts
respectively;

 

(e)           payments of all  other Obligations pro rata to each Creditor Party; and

 

83

 

(f)            any amount remaining after application as
provided above, and after all of the Obligations have been indefeasibly paid in
full, shall be paid to either Borrower or whomever else may be legally entitled
thereto.

 

11.5      Performance by the Administrative Agent.  If either Borrower or any of the Guarantors
shall fail to perform any covenant, duty or agreement contained in any of the
Loan Documents, the Administrative Agent may perform or attempt to perform such
covenant, duty or agreement on behalf of such Person after the expiration of
any cure or grace periods set forth herein if and to the extent the
Administrative Agent considers in its discretion that such performance is
necessary or advisable in order to protect or preserve the Collateral or in
order to protect against a potential Material Adverse Effect.  In such event, such Person shall, at the
request of the Administrative Agent, promptly pay any amount expended by the
Administrative Agent in such performance or attempted performance to the
Administrative Agent, together with interest thereon at the applicable Default
Rate from the date of such expenditure until paid.  Notwithstanding the foregoing, the
Administrative Agent shall not have any liability or responsibility whatsoever
for the performance of any obligation of such Person under this Credit Agreement
or any other Loan Document in the absence of its gross negligence or willful
misconduct.  All amounts expended by the
Administrative Agent pursuant to this Section shall constitute Obligations
secured by the Collateral.

 

11.6      Rights Cumulative.  The rights and remedies of the Administrative
Agent and the other Creditor Parties under this Credit Agreement and each of
the other Loan Documents shall be cumulative and not exclusive of any rights or
remedies which any of them may otherwise have under Applicable Law.  In exercising their respective rights and
remedies the Administrative Agent and the other Creditor Parties may be
selective and no failure or delay by any such Person in exercising any right
shall operate as a waiver thereof, nor shall any single or partial exercise of
any power or right preclude its other or further exercise or the exercise of
any other power or right.

 

12.       SETOFF.

 

Regardless of the adequacy of any collateral,
if any Event of Default shall have occurred and be continuing, any deposits or
other sums credited by or due from the Administrative Agent or any other
Creditor Party to either Borrower or any of the Guarantors and any securities
or other property of either Borrower or any of the Guarantors in the possession
of the Administrative Agent or such other Creditor Party or any of their
respective Affiliates may, at any time, solely with the consent of the
Administrative Agent, without demand or notice (any such notice being expressly
waived by the Borrowers and the Guarantors), in whole or in part, be applied to
or set off by the Administrative Agent or such other Creditor Party against the
payment of Obligations, now existing or hereafter arising, of the Borrowers or
any of the Guarantors to the Administrative Agent or such other Creditor Party
regardless of the adequacy of any other collateral securing the Loans. The
Administrative Agent and each of the other Creditor Parties agree with and
among each other that (i) if an amount to be set off is to be applied to
Indebtedness of the Borrowers or any of the Guarantors to the Administrative
Agent or such 

 

84

 

other Creditor Party, such amount shall be
applied ratably first to Obligations owed to the Creditor Party exercising such
right of set off and pro rata to any other similarly situated Creditor Parties,
and then to the Obligations owed all other Creditor Parties, including, without
limitation, Reimbursement Obligations owed to the Issuing Bank or all Lenders,
and (ii) if the Administrative Agent or such other Creditor Party shall
receive from either Borrower or any Guarantor or any other source, whether by
voluntary payment, exercise of the right of setoff, counterclaim, cross action,
enforcement of the claim evidenced by this Credit Agreement in the name of, or
constituting Reimbursement Obligations owed to, the Administrative Agent or
such other Creditor Party by proceedings against a Borrower or a Guarantor 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 Obligations owed to the Administrative Agent or such other Creditor Party
any amount in excess of its ratable portion of the payments received by all of
the Creditor Parties with respect to the debt evidenced hereby corresponding to
all of the Creditor Parties, such Creditor Party will make such disposition and
arrangements with the other Creditor Parties with respect to such excess,
either by way of distribution, pro tanto assignment of claims, subrogation or
otherwise as shall result in each Creditor Party receiving in respect of the
debt evidenced hereby in its name or Reimbursement Obligations owed it, its
proportionate payment as contemplated by this Credit Agreement; provided that if
all or any part of such excess payment is thereafter recovered from such
Creditor Party, such disposition and arrangements shall be rescinded and the
amount restored to the extent of such recovery, but without interest. ANY AND ALL RIGHTS TO REQUIRE THE ADMINISTRATIVE AGENT
TO EXERCISE ITS RIGHTS OR REMEDIES WITH RESPECT TO ANY OTHER COLLATERAL WHICH
SECURES THE OBLIGATIONS, PRIOR TO THE ADMINISTRATIVE AGENT OR ANY OTHER
CREDITOR PARTY EXERCISING ANY RIGHT OF SETOFF WITH RESPECT TO SUCH DEPOSITS,
CREDITS OR OTHER PROPERTY OF EITHER BORROWER OR ANY GUARANTOR ARE HEREBY
KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED.

 

13.       THE
ADMINISTRATIVE AGENT.

 

13.1      Authorization.

 

13.1.1      Authorization to Act.  The Administrative Agent is authorized to
take such action on behalf of each of the Creditor Parties and to exercise all
such powers as are hereunder and under any of the other Loan Documents and any
related documents delegated to the Administrative Agent, together with such
powers as are reasonably incident thereto, including the authority, without the
necessity of any notice to or further consent of the Creditor Parties, from
time to time to take any action with respect to any Collateral or the Loan
Documents which may be necessary to perfect, maintain perfected or insure the
priority of the security interest in and liens upon the Collateral granted
pursuant to the Loan Documents, and no duties or responsibilities not expressly
assumed herein or therein shall be implied to have been assumed by the
Administrative Agent.

 

13.1.2      Independent Contractor.  The relationship between the Administrative
Agent and each of the Creditor Parties is that of an independent contractor. 

 

85

 

The use of the term “Administrative Agent” is for
convenience only and is used to describe, as a form of convention, the
independent contractual relationship between the Administrative Agent and each
of the Creditor Parties. Nothing contained in this Credit Agreement nor the
other Loan Documents shall be construed to create an agency, trust or other
fiduciary relationship between the Administrative Agent and any of the Creditor
Parties.

 

13.1.3      Representative.  As an independent contractor empowered by the
Creditor Parties to exercise certain rights and perform certain duties and
responsibilities hereunder and under the other Loan Documents, the
Administrative Agent is nevertheless a “representative” of the Creditor
Parties, as that term is defined in Article 1 of the Uniform Commercial
Code, for purposes of actions for the benefit of the Creditor Parties and the
Administrative Agent with respect to all collateral security and guaranties
contemplated by the Loan Documents. Such actions include the designation of the
Administrative Agent as “secured party,” “pledgee” or the like on all financing
statements and other documents and instruments, whether recorded or otherwise,
relating to the attachment, perfection, priority or enforcement of any security
interests, pledges, mortgages or deeds of trust in collateral security intended
to secure the payment or performance of any of the Obligations, all for the
benefit of the Creditor Parties and the Administrative Agent.

 

13.1.4      Regarding Collateral.  The Administrative Agent is authorized and
directed by the Creditor Parties to consent to any sale or other disposition of
Collateral permitted to be sold or disposed of hereunder, and to release its
liens on such Collateral, and the Administrative Agent is authorized to rely on
a certification from the Borrowers that such sale or disposition is permitted
hereunder.

 

13.2      Employees, Advisors and the Administrative Agent.  The Administrative Agent may exercise its
powers and execute its duties by or through employees or agents and shall be
entitled to take, and to rely on, advice of counsel selected by it in the
absence of gross negligence or willful misconduct, concerning all matters
pertaining to its rights and duties under this Credit Agreement and the other
Loan Documents. The Administrative Agent may utilize the services of such
Persons as the Administrative Agent in its sole discretion may reasonably
determine, and all reasonable fees and expenses of any such Persons shall be
paid by the Borrowers pursuant to Section 14.

 

13.3      No Liability.  Neither the Administrative Agent (in its
capacity as Administrative Agent) nor any of its Related Parties nor any other
Person assisting them in their duties nor any agent or employee thereof, shall
be liable to any Creditor Party for any waiver, consent or approval given or any
action taken, or omitted to be taken, in good faith by it or them hereunder or
under any of the other Loan Documents, or in connection herewith or therewith,
or be responsible for the consequences of any 

 

86

 

oversight or error of judgment whatsoever, except that
the Administrative Agent or such other Person, as the case may be, may be
liable for losses due to its willful misconduct or gross negligence.  Each of the Issuing Bank and the
Administrative Agent shall be fully justified in failing or refusing to take
any action under this Credit Agreement unless it shall first have received such
advice or concurrence of the Required Lenders as they reasonably deem
appropriate or it shall first be indemnified to its reasonable satisfaction by
the other Creditor Parties against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such action.
The Issuing Bank and the Administrative Agent shall in all cases be fully
protected in acting, or in refraining from acting, under this Credit Agreement
in accordance with a request of the Required Lenders, and such request and any
action taken or failure to act pursuant thereto shall be binding upon the
Creditor Parties and all future holders of a Commitment or of a Letter of
Credit Participation.

 

13.4      No Representations.

 

13.4.1      General.  The Administrative Agent shall not be
responsible for the execution or validity or enforceability of this Credit
Agreement, the Letters of Credit, any Notes, any of the other Loan Documents or
any instrument at any time constituting, or intended to constitute, collateral
security for any of the Loan Documents, or for the value of any such collateral
security or for the validity, enforceability, or collectibility of any such
amounts owing with respect to any of the Loan Documents, or for any recitals or
statements, warranties or representations made herein or in any of the other
Loan Documents or in any certificate or instrument hereafter furnished to it by
or on behalf of the Borrowers, the Guarantors or any of their respective
Subsidiaries, or be bound to ascertain or inquire as to the performance or
observance of any of the terms, conditions, covenants or agreements herein or
in any instrument at any time constituting, or intended to constitute,
collateral security for any of the Loan Documents or to inspect any of the
properties, books or records of the Borrowers, the Guarantors or any of their
respective Subsidiaries. The Administrative Agent shall not be bound to
ascertain whether any notice, consent, waiver or request delivered to it by the
Borrowers or any Guarantor shall have been duly authorized or is true, accurate
and complete so long as the Administrative Agent believes in good faith that
any such notice, consent, waiver or request is genuine and has been signed,
sent or made by the proper person. The Administrative Agent has not made nor
does it now make any representations or warranties, express or implied, nor
does it assume any liability to the Creditor Parties, with respect to the
creditworthiness or financial conditions of the Borrowers, any Guarantor or any
of their Subsidiaries. Each Creditor Party acknowledges that it has,
independently and without reliance upon the Administrative Agent or any other
Creditor Party, and based upon such information and documents as it has deemed
appropriate, made its own 

 

87

 

credit analysis and decision to enter into this Credit
Agreement, the other Loan Documents and the transactions contemplated hereby.

 

13.4.2      Closing Documentation, Etc.  For
purposes of determining compliance with the conditions set forth in Section 7,
each Creditor Party that has executed this Credit Agreement shall be deemed to
have consented to, approved or accepted, or to be satisfied with, each document
and matter either sent, or made available, by the Administrative Agent to such
Creditor Party for consent, approval, acceptance or satisfaction, or required
thereunder to be consented to or approved by or acceptable or satisfactory to
such Creditor Party.

 

13.5      Payments.

 

13.5.1      Payments to Administrative Agent.  A payment by the Borrowers to the
Administrative Agent hereunder or under any of the other Loan Documents for the
account of any Creditor Party shall constitute a payment to such Creditor
Party. The Administrative Agent agrees promptly to distribute to each Creditor
Party such Creditor Party’s pro rata share of payments received by the
Administrative Agent for the account of such Creditor Party except as otherwise
expressly provided herein or in any of the other Loan Documents.

 

13.5.2      Distribution by Administrative Agent.  If in the opinion of the Administrative Agent
the distribution of any amount received by it in such capacity hereunder or
under any of the other Loan Documents might expose it to any liability, it may
refrain from making distribution until its right to make distribution shall
have been adjudicated by a court of competent jurisdiction. If a court of
competent jurisdiction shall adjudge that any amount received and distributed
by the Administrative Agent is to be repaid, each Person to whom any such
distribution shall have been made shall either repay to the Administrative
Agent its proportionate share of the amount so adjudged to be repaid or shall
pay over the same in such manner and to such Persons as shall be determined by
such court.

 

13.5.3      Delinquent Lenders.  Notwithstanding anything to the contrary
contained in this Credit Agreement or any of the other Loan Documents, any
Lender that fails (i) to make available to the Administrative Agent its pro
rata share of any Loan, to acquire its pro rata share of any
Swingline Loan, or to pay any Letter of Credit Participation in accordance with
the terms of this Credit Agreement or (ii) to comply with the provisions
of Section 12 with respect to making dispositions and arrangements
with the other Lenders, where such Lender’s share of any payment received,
whether by setoff or otherwise, is in excess of its pro rata share of such
payments due and payable to all of the Lenders, in each case as, when and to
the full extent required by the provisions of this Credit Agreement, shall be
deemed delinquent and shall be deemed a Delinquent Lender (a 

 

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“Delinquent Lender”) until such time as such
delinquency is satisfied. A Delinquent Lender shall be deemed to have assigned
any and all payments due to it from the Borrowers, whether on account of
outstanding Loans, Swingline Loans, Unpaid Reimbursement Obligations, interest,
fees or otherwise, to the remaining applicable non-delinquent Lenders for
application to, and reduction of, their respective pro rata shares of all
outstanding Loans, Swingline Loans and Unpaid Reimbursement Obligations. The
Delinquent Lender hereby authorizes the Administrative Agent to distribute such
payments to the applicable non-delinquent Lenders in proportion to their
respective pro rata shares of all applicable outstanding Loans, Swingline Loans
and Unpaid Reimbursement Obligations. A Delinquent Lender shall be deemed to
have satisfied in full a delinquency when and if, as a result of application of
the assigned payments to all applicable outstanding Loans, Swingline Loans and
Unpaid Reimbursement Obligations of the non-delinquent Lenders, the Lenders’
respective pro rata shares of all outstanding Loans, Swingline Loans and
Unpaid Reimbursement Obligations have returned to the respective Revolving Loan
Commitment Percentages or Term Loan Commitment Percentages, as the case may be,
of all the Lenders without giving effect to the nonpayment causing such
delinquency.

 

13.5.4      Indemnity.  The Lenders ratably agree hereby to indemnify
and hold harmless the Administrative Agent and the Revolving Credit Lenders
ratably agree hereby to indemnify and hold harmless the Issuing Bank and the
Swingline Lender, from and against any and all claims, actions and suits
(whether groundless or otherwise), losses, damages, costs, expenses (including
any expenses for which the Administrative Agent, the Issuing Bank and/or the
Swingline Lender have not been reimbursed by the Borrowers as required by Section 14
and indemnifications pursuant to Section 15), and liabilities of
every nature and character arising out of or related to this Credit Agreement
or any of the other Loan Documents or the transactions contemplated or
evidenced hereby or thereby, or the Administrative Agent’s, the Issuing Bank’s
or the Swingline Lender’s actions taken hereunder or thereunder, except to the
extent that any of the same shall be paid by or on behalf of the Borrowers or
caused by the Administrative Agent’s, the Issuing Bank’s or the Swingline
Lender’s willful misconduct or gross negligence.

 

13.6      Administrative Agent as Lender, Swingline Lender and
Issuing Bank.  In its
individual capacity, Bank of America shall have the same obligations and the
same rights, powers and privileges in respect to its Commitment and the Loans
made by it and as the purchaser of any Letter of Credit Participation as it
would have were it not also the Administrative Agent, Swingline Lender or
Issuing Bank.

 

13.7      Resignation.  The Administrative Agent may resign at any
time by giving sixty (60) days prior written notice thereof to the Creditor
Parties and the Borrowers. Upon any such resignation, the Required Lenders
shall have the right to appoint a 

 

89

 

successor Administrative Agent. Unless an Event of
Default shall have occurred and be continuing, such successor Administrative
Agent shall be acceptable to the Borrowers; provided that the Borrowers
shall not unreasonably withhold, condition or delay any such acceptance. If no
successor Administrative Agent shall have been so appointed by the Required
Lenders and shall have accepted such appointment within thirty (30) days after
the retiring Administrative Agent’s giving of notice of resignation, then the
retiring Administrative Agent may, on behalf of the Creditor Parties, appoint a
successor Administrative Agent, which shall be a financial institution having a
rating of not less than A by S&P or its equivalent by another nationally
recognized rating agency.  Unless an
Event of Default shall have occurred and be continuing, such successor
Administrative Agent shall be acceptable to the Borrowers; provided that
the Borrowers shall not unreasonably withhold, condition or delay any such
acceptance. Upon the acceptance of any appointment as Administrative Agent
hereunder by a successor Administrative Agent, such successor Administrative
Agent shall thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Administrative Agent, and the retiring
Administrative Agent shall be discharged from its duties and obligations
hereunder. After any retiring Administrative Agent’s resignation, the
provisions of this Credit Agreement and the other Loan Documents 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 Administrative Agent.  Any resignation by Bank of America, as Administrative Agent
pursuant to this Section shall also constitute its resignation as Issuing
Bank and Swingline Lender. Upon the acceptance of a successor’s appointment as
Administrative Agent hereunder, (a) such successor shall succeed to and
become vested with all of the rights, powers, privileges and duties of the
retiring Issuing Bank and Swingline Lender, (b) the retiring Issuing Bank
and Swingline Lender shall be discharged from all of its duties and obligations
hereunder or under the other Loan Documents, (c) the successor Issuing
Bank shall issue letters of credit in substitution for the Letters of Credit,
if any, outstanding at the time of such succession or make other arrangements
satisfactory to the retiring Issuing Bank to effectively assume the obligations
of the retiring Issuing Bank with respect to such Letters of Credit, and
(d) the successor Swingline Lender shall advance Swingline Loans to repay
the retiring Swingline Lender to effectively assume the obligations of the
retiring Swingline Lender with respect to such Swingline Loans.

 

13.8      Notification of Defaults.  Each Creditor Party hereby agrees that, upon
learning of the existence of a Default, it shall promptly notify the Administrative
Agent thereof, whereupon the Administrative Agent will notify the other
Creditor Parties of such Default. The Administrative Agent hereby agrees that
upon receipt of any notice under this Section it shall promptly notify the
other Creditor Parties of the existence of such Default.

 

13.9      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 and the Maturity Dates shall have occurred, the Administrative
Agent may if it so elects and, shall if (a) so requested by the Required
Lenders and (b) the 

 

90

 

Lenders have provided to the Administrative Agent such
additional indemnities and assurances against expenses and liabilities as the
Administrative Agent may reasonably request, proceed to enforce the provisions
of the Loan Documents authorizing the sale or other disposition of all or any
part of the Collateral and exercise all or any such other legal and equitable
and other rights or remedies as it may have in respect of such Collateral. The
Required Lenders may direct the Administrative Agent in writing as to the
method and the extent of any such sale or other disposition, the Lenders hereby
agreeing to indemnify and hold the Administrative Agent harmless from all
liabilities incurred in respect of all actions taken or omitted in accordance
with such directions (other than with respect to such liabilities arising out
of the Administrative Agent’s, but not the Required Lenders’, gross negligence
or willful misconduct); provided that the Administrative Agent need not
comply with any such direction to the extent that the Administrative Agent
reasonably believes the Administrative Agent’s compliance with such direction
to be unlawful or commercially unreasonable in any applicable jurisdiction.

 

13.10    Administrative Agent May File Proofs of Claim.

 

In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial, administrative or like proceeding or any assignment for the benefit
of creditors relative to either Borrower, any Guarantor or any of the Pledged
Entities, the Administrative Agent (irrespective of whether the principal of
any Loan or Reimbursement Obligation shall then be due and payable as herein
expressed or by declaration, by operation of the terms of Section 11.2.1,
or otherwise and irrespective of whether the Administrative Agent shall have
made any demand on the Borrower) shall be entitled and empowered, by
intervention in such proceeding, under any such assignment or otherwise:

 

(a)           to file and prove a
claim for the whole amount of the principal and interest owing and unpaid in
respect of the Loans or Reimbursement Obligations and all other Obligations
that are owing and unpaid and to file such other documents as may be necessary
or advisable in order to have the claims of the Creditor Parties and the
Administrative Agent (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Lenders and the Administrative
Agent and their respective agents and counsel and all other amounts due the
Creditor Parties and the Administrative Agent under Sections 5.6, 6.1,
and 14)  allowed in such
proceeding or under any such assignment; and

 

(b)           to collect and receive
any monies or other property payable or deliverable on any such claims and to
distribute the same in accordance with the terms of this Credit Agreement.

 

Any custodian,
receiver, assignee, trustee, liquidator, sequestrator or other similar official
in any such proceeding or under any such assignment is hereby authorized by
each Creditor Party to make such payments to the Administrative Agent and, in
the event that the Administrative Agent shall consent to the making of such
payments directly to the Creditor Parties, nevertheless to pay to the
Administrative Agent any amount due for the reasonable compensation, expenses, 

 

91

 

disbursements and
advances of the Administrative Agent and its agents and counsel, and any other
amounts due the Administrative Agent under Sections 5.6, 6.1, and
14).

 

Nothing contained herein shall authorize the Administrative Agent to
consent to or accept or adopt on behalf of any Creditor Party any plan
of reorganization, arrangement,
adjustment or composition affecting the Obligations owed to such Creditor
Party or the rights of any Lender or to
authorize the Administrative Agent to vote in respect of the claim of any
Lender in any such proceeding or under any such assignment.

 

14.       EXPENSES.

 

The Borrowers agree to pay (i) the
reasonable costs of producing and reproducing this Credit Agreement, the other
Loan Documents and the other agreements and instruments mentioned herein, (ii) without
duplication of any amounts paid by the Borrowers pursuant to Section 6.3,
any Taxes (including any interest and penalties in respect thereto) payable by
any of the Creditor Parties (other than Excluded Taxes) on or with respect to
the transactions contemplated by this Credit Agreement (the Borrowers hereby
agreeing to indemnify the Creditor Parties with respect thereto), (iii) the
reasonable fees, expenses and disbursements of the Administrative Agent’s
counsel or any local counsel to the Administrative Agent incurred in connection
with the preparation, negotiation, execution, delivery, administration or
interpretation of the Loan Documents and other instruments mentioned herein,
each closing hereunder, amendments, modifications, restatements, approvals,
consents or waivers hereto or hereunder, and proposed amendments,
modifications, restatements, approvals, consents or waivers hereto or
hereunder, (iv) the reasonable fees, expenses and disbursements of the
Administrative Agent incurred by the Administrative Agent in connection with
the preparation and syndication of the Loan Documents and other instruments
mentioned herein, including, without limitation, collateral examination, legal
fees, appraisal expenses and environmental audits, (v) the reasonable
fees, expenses and disbursements of the Administrative Agent incurred by the
Administrative Agent in connection with the administration or interpretation of
the Loan Documents and other instruments mentioned herein, including, without
limitation, collateral examination and appraisal expenses, (vi) all
reasonable fees, expenses and disbursements (including without limitation
reasonable attorneys’ fees and costs and reasonable consulting, accounting,
appraisal, investment banking and similar professional fees and charges)
incurred by any of the Creditor Parties in connection with (A) the
enforcement of or preservation of rights under any of the Loan Documents
against any of the Guarantors, the Borrowers or any of their respective Subsidiaries
or the administration thereof after the occurrence of a Default, and (B) any
litigation, proceeding or dispute whether arising hereunder or otherwise, in
any way related to any Creditor Party’s relationship with any of the Borrowers,
the Guarantors, or any of their respective Subsidiaries, unless such Creditor
Party is conclusively determined by a final order of a court of competent
jurisdiction to have breached its obligations hereunder, (vii) any
reasonable and customary fees, costs, expenses and bank charges, including bank
charges for returned checks, incurred by any of the Creditor Parties or any of
their Affiliates in establishing, maintaining or handling of any accounts for
the collection, application or disposition of any of the Collateral, and (viii) all
reasonable fees, expenses and disbursements of the Creditor Parties incurred in
connection with UCC searches, and UCC filings. The Borrowers and the Guarantors
authorize the Creditor Parties to debit any account maintained by either
Borrower or a Guarantor, with a Creditor Party or with any of their

 

92

 

Affiliates, in payment of amounts due hereunder.  The covenants of this Section shall
survive payment or satisfaction of all other Obligations.

 

15.       INDEMNIFICATION.

 

The Borrowers and the Guarantors agree
jointly and severally to indemnify and hold harmless the Creditor Parties
together with each of their Affiliates and their Related Parties, from and
against any and all claims, actions and suits whether groundless or otherwise,
and from and against any and all liabilities, losses, damages and expenses of
every nature and character arising out of this Credit Agreement or any of the
other Loan Documents or the transactions contemplated hereby including, without
limitation, (i) any actual or proposed use by the Borrowers or any of
their Subsidiaries of the proceeds of any of the Loans or Letters of Credit, (ii) the
reversal or withdrawal of any provisional credits granted by any Creditor
Party, or any of their Affiliates upon the transfer of funds from bank agency
or lock box accounts or in connection with the provisional honoring of checks
or other items, (iii) the Borrowers, the Guarantors or any of their
respective Subsidiaries entering into or performing this Credit Agreement or
any of the other Loan Documents, (iv) any actual or alleged infringement
of any patent, copyright, trademark, service mark or similar right of the
Borrowers, the Guarantors or any of their respective Subsidiaries, or (v) with
respect to the Borrowers, the Guarantors and their respective Subsidiaries and
their respective properties and assets, the violation of any environmental law,
the presence, disposal, escape, seepage, leakage, spillage, discharge,
emission, release or threatened release of any hazardous substances or any
action, suit, proceeding or investigation brought or threatened with respect to
any hazardous substances (including, but not limited to, claims with respect to
wrongful death, personal injury or damage to property), in each case including,
without limitation, the reasonable fees and disbursements of counsel incurred
in connection with any such event, circumstances, investigation, litigation or
other proceeding, provided, however, that the Borrowers and
Guarantors shall not be liable to the Creditor Parties, any of their Affiliates
or any of their Related Parties for any of the foregoing to the extent that
they arise from such Person’s gross negligence or willful misconduct as
determined by final order of a court of competent jurisdiction. In litigation,
or the preparation therefor, the Creditor Parties shall be entitled to select
their own counsel and, in addition to the foregoing indemnity, the Borrowers
and Guarantors agree to pay promptly the reasonable fees and expenses of such
counsel. If and to the extent that the obligations of either Borrower or any
Guarantor under this Section are unenforceable for any reason, the
Borrowers and Guarantors hereby jointly and severally agree to make the maximum
contribution to the payment in satisfaction of such obligations which is
permissible under applicable law. The covenants contained in this Section shall
survive payment or satisfaction in full of all other Obligations. Each of the
Creditors Parties agree to promptly notify the Borrowers of any such claim,
action, suit, liability, loss, damage or expense after becoming aware of the
same; provided that the failure to provide such notice shall not affect the
Borrowers’ and Guarantors’ obligations under this Section.

 

16.       SURVIVAL
OF COVENANTS, JOINT AND SEVERAL OBLIGATIONS, ETC.

 

16.1      Survival.  All covenants, agreements, representations
and warranties made herein, in any of the other Loan Documents or in any
documents or other papers delivered by or on behalf of the Borrowers, the
Guarantors or any of their respective 

 

93

 

Subsidiaries pursuant hereto shall be deemed to have
been relied upon by the Creditor Parties, notwithstanding any investigation
heretofore or hereafter made by any of them, and shall survive the making of
any of the Loans and the issuance, extension or renewal of any Letters of
Credit, as herein contemplated, and shall continue in full force and effect so
long as any Letter of Credit or any Obligation due under this Credit Agreement
or any of the other Loan Documents remains outstanding or any obligation to
make any Loans or any obligation to issue, extend or renew any Letter of
Credit, and for such further time as may be otherwise expressly specified in
this Credit Agreement. All statements contained in any certificate or other
paper delivered to any Creditor Party at any time by or on behalf of the
Borrowers, the Guarantors or any of their respective Subsidiaries pursuant
hereto or in connection with the transactions contemplated hereby shall
constitute representations and warranties by the Borrowers, the Guarantors or
such Subsidiary hereunder.

 

16.2      Joint and Several Obligations.  All of the Obligations shall be the
individual, as well as the joint and several, obligation, responsibility,
commitment and liability of each of the Borrowers and the Guarantors.  Regardless of the payment in full of the
Obligations and termination of all Commitments of the Lenders if, after the
payment in full of the Obligations, any portion of such payments to the
Administrative Agent or any other Creditor Party is subsequently invalidated,
declared to be fraudulent or preferential, set aside or required to be repaid
to a trustee, receiver or any other party under any bankruptcy law, any other
state or federal law, common law or any equitable cause, then the Obligations
and all liens, rights and remedies therefor or relating thereto shall be
reinstated to the extent of such invalidation, declaration, set aside or
repayment, and the Borrowers and the Guarantors shall continue to be jointly
and severally liable for such reinstated Obligations as if such Obligations had
not been paid.

 

16.3      Maximum Amount.  Anything contained in this Agreement or the
other Loan Documents to the contrary notwithstanding, the amount of the
Obligations payable by each Borrower under this Agreement or the other Loan
Documents shall be the aggregate amount of the Obligations unless a court of
competent jurisdiction adjudicates such Borrower’s Obligations under this
Agreement and the other Loan Documents (or the amount thereof) to be invalid or
unenforceable for any reason (including, without limitation, because of any
applicable state or federal law relating to fraudulent conveyances or
transfers), in which case the amount of the Obligations payable by such
Borrower hereunder or thereunder shall be limited to the maximum amount that
could be incurred by such Borrower without rendering such Borrower’s
obligations under this Agreement and the other Loan Documents invalid or
unenforceable under such applicable law.

 

17.       ASSIGNMENT
AND PARTICIPATION.

 

17.1      General Conditions.  The provisions of this Credit Agreement shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby, except that neither
Borrower nor any of the 

 

94

 

Guarantors may assign or otherwise transfer any of
their respective rights or obligations hereunder without the prior written
consent of the Administrative Agent and each Lender and no Lender may, and the
Swingline Lender may not, assign or otherwise transfer any of its rights or
obligations hereunder except (a) to an Eligible Assignee in accordance
with the provisions of Section 17.2, (b) by way of
participation in accordance with the provisions of Section 17.4 or (c) by
way of pledge or assignment of a security interest subject to the restrictions
of Section 17.6 (and any other attempted assignment or transfer by
any party hereto shall be null and void). Nothing in this Credit Agreement,
expressed or implied, shall be construed to confer upon any Person (other than
the parties hereto, their respective successors and assigns permitted hereby,
Participants to the extent provided in Section 17.4 and, to the
extent expressly contemplated hereby, the Related Parties of each of the Administrative
Agent and the Lenders) any legal or equitable right, remedy or claim under or
by reason of this Credit Agreement or any of the other Loan Documents.

 

17.2      Assignments.  Any Lender may at any time assign to one or
more Eligible Assignees all or a portion of its rights and obligations under
this Credit Agreement (including all or a portion of its Revolving Loan
Commitment or Term Loan Commitment, and the Loans at the time owing to it); provided
that:

 

17.2.1      Minimum
Assignments.  Any
assignment of any Revolving Loan Commitment shall be for a minimum amount of
such Revolving Loan Commitment of $5,000,000;
and any assignment of any Term Loan Commitment shall be for a minimum amount of
such Term Loan Commitment of $1,000,000;
provided, however, that the foregoing minimum amounts shall not
apply to any assignment to another existing Lender or to a Lender’s Affiliate
or Approved Fund (provided  further, however, that the
aggregate Commitments held by any particular Lender and its Affiliates and its
Approved Funds shall satisfy the foregoing minimum amounts).

 

17.2.2      Deliverables.  The parties to each assignment shall execute
and deliver to the Administrative Agent an Assignment and Acceptance
substantially in the form and content of Exhibit 17.2.2 (an “Assignment
and Acceptance”), together with a processing and recordation fee of $3,500, and the Eligible Assignee, if it shall
not be a Lender, shall deliver to the Administrative Agent an administrative
questionnaire in such substance and form, and providing such information, as
the Administrative Agent may require from time to time, provided, however,
that only one such processing and recordation fee will be charged in connection
with the simultaneous assignment by a single Lender to more than one of its Approved
Funds.

 

17.2.3      Joinder.  Subject to acceptance and registering thereof
by the Administrative Agent pursuant to Section 17.3, from and
after the effective date specified in each Assignment and Acceptance, the
Eligible Assignee thereunder shall be a party to this Credit Agreement and, to
the 

 

95

 

extent of the interest assigned by such Assignment and
Acceptance have the rights and obligations of a Lender, or, if applicable, the
Swingline Lender, under this Credit Agreement, and the assigning Lender or
Swingline Lender thereunder shall, to the extent of the interest assigned by
such Assignment and Acceptance, be released from its obligations as such under
this Credit Agreement (and, in the case of an Assignment and Acceptance
covering all of the assigning Person’s rights and obligations under this Credit
Agreement, such Person shall cease to be a party hereto) but shall continue to
be entitled to the benefits of (i) Sections 6.3, 6.8, 6.9
and 6.12 with respect to facts and circumstances occurring prior to the
effective date of such assignment and (ii) Section 15
notwithstanding such assignment. Any assignment or transfer by a Lender or the
Swingline Lender of rights or obligations under this Credit Agreement that does
not comply with this paragraph shall be treated for purposes of this Credit
Agreement as a sale by such Person of a participation in such rights and
obligations in accordance with Section 17.4.

 

17.3      Register; Accounts.  The Administrative Agent will maintain at the
Administrative Agent’s Office a copy of each Assignment and Acceptance
delivered to it, and Schedule 2 as a register for the recordation of the
names and addresses of the Lenders, the Swingline Lender and the Issuing Bank,
and the Commitments and Commitment Percentages of each Lender.  The Administrative Agent will also maintain
accounts reflecting principal amounts of the Revolving Loans and Term Loan
owing to each Lender pursuant to the terms hereof from time to time, payments
made on such Loans and other appropriate debits and credits (the “Revolving
Loan Account” and the “Term Loan Account,” respectively and, collectively with Schedule
2, the “Register”). The Administrative Agent may unilaterally, from time to
time, revise the Register so as to update the information set forth thereon
(including, without limitation, as a result of any reductions of Commitments
pursuant to Section 2.5, as well as arising out of the execution
and delivery of any Assignment and Acceptance); and the entries in the Register
shall be conclusive absent manifest error. The Borrowers, the Guarantors, the
Administrative Agent, the Issuing Bank, the Swingline Lender and the Lenders
may treat each Person whose name is recorded as a Lender in the Register  pursuant
to the terms hereof as a Lender hereunder for all purposes of this Credit
Agreement, notwithstanding notice to the contrary. The Register shall be
available for inspection by the Borrowers, the Issuing Bank, the Swingline
Lender and any Lender, at any reasonable time and from time to time upon
reasonable prior notice.

 

17.4      Participations.  Any Lender may at any time, without the
consent of, or notice to, either Borrower, any Guarantor, or any of the other
Creditor Parties, sell participations to any Person (other than a natural
person) (each, a “Participant”) in all or a portion of such Lender’s rights
and/or obligations under this Credit Agreement (including all or a portion of
its Commitments and/or the Loans owing to it); provided that (a) such
Lender’s obligations under this Credit Agreement shall remain unchanged, (b) such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations and (c) the Borrowers, the 

 

96

 

Guarantors and the other Creditor Parties shall
continue to deal solely and directly with such Lender in connection with such
Lender’s rights and obligations under this Credit Agreement. Any agreement or
instrument pursuant to which a Lender sells such a participation shall provide
that such Lender shall retain the sole right to enforce this Credit Agreement
and to approve any amendment, modification or waiver of any provision of this
Credit Agreement in accordance with the terms of this Credit Agreement; provided
that such agreement or instrument may provide that, solely as between such
Lender and the Participant, such Lender will not, without the consent of the
Participant, agree to any amendment, modification or waiver 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 Closing Fee, the Unused Facility Fee or Letter of
Credit Fees to which such Participant is entitled or extend any regularly
scheduled payment date for principal or interest. Subject to Section 17.5,
the Borrowers and the Guarantors agree that each Participant shall be entitled
to the benefits of Sections 6.3, 6.8, 6.9 and 6.12
to the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to Section 17.2. To the extent permitted by
law, each Participant also shall be entitled to the benefits of Section 12  as though it were a Lender, provided such
Participant agrees to be subject to Section 12 as though it were a
Lender.

 

17.5      Payments to Participants.  A Participant shall not be entitled to
receive any greater payment under Sections 6.3, 6.8, 6.9
and 6.12 than the applicable Lender would have been entitled to receive
with respect to the participation sold to such Participant.

 

17.6      Miscellaneous Assignment Provisions.  A Lender may at any time grant a security
interest in all or any portion of its rights under this Credit Agreement to
secure obligations of such Lender, including without limitation (a) any
pledge or assignment to secure obligations to any of the twelve Federal Reserve
Banks organized under Section 4 of the Federal Reserve Act, 12 U.S.C. §341
and (b) with respect to any Lender that is a Fund, to any lender or any
trustee for, or any other representative of, holders of obligations owed or
securities issued by such Fund as security for such obligations or securities
or any institutional custodian for such Fund or for such lender; provided
that no such grant shall release such Lender from any of its obligations
hereunder, provide any voting rights hereunder to the secured party thereof,
substitute any such secured party for such Lender as a party hereto or affect
any rights or obligations of either Borrower, any Guarantor, the Administrative
Agent, the Swingline Lender or the Issuing Bank hereunder.

 

17.7      Assignee or Participant Affiliated with CHC.  If any assignee Lender is an Affiliate of
either Borrower or any of the Guarantors, then any such assignee Lender shall
have no right to vote as a Lender hereunder or under any of the other Loan
Documents for purposes of granting consents or waivers or for purposes of
agreeing to amendments or other modifications to any of the Loan Documents or
for purposes of making requests or giving directions to the Administrative
Agent pursuant to Section 11.2.1 or Section 23, and the
determination of the Required 

 

97

 

Lenders shall for all purposes of this Credit Agreement
and the other Loan Documents be made without regard to such assignee Lender’s
interest in any of the Loans or Reimbursement Obligations. If any Lender sells
a participating interest in any of the Loans or Reimbursement Obligations to a
Participant, and such Participant is an Affiliate of either Borrower or any of
the Guarantors, then such transferor Lender shall promptly notify the
Administrative Agent of the sale of such participation. A transferor Lender
shall have no right to vote as a Lender hereunder or under any of the other
Loan Documents for purposes of granting consents or waivers or for purposes of
agreeing to amendments or modifications to any of the Loan Documents or for
purposes of making requests to the Administrative Agent pursuant to Section 11.2.1
or Section 23 to the extent that such participation is beneficially
owned by either Borrower or any of the Guarantors or any of their respective
Affiliates, and the determination of the Required Lenders shall for all
purposes of this Credit Agreement and the other Loan Documents be made without
regard to the interest of such transferor Lender in the Loans or Reimbursement
Obligations to the extent of such participation.

 

17.8      Recordation in Register.  Upon its receipt of an Assignment and Acceptance
executed by the parties to such assignment, together with a copy of any Note
subject to such assignment, the Administrative Agent shall (a) record the
information contained therein in the Register, and (b) give prompt notice
thereof to the Borrowers and the other Creditor Parties by issuance of an
updated Schedule 2.

 

18.       NOTICES,
ETC.

 

Except as otherwise expressly provided in this Credit Agreement, all
notices and other communications made or required to be given pursuant to this
Credit Agreement or any Letter of Credit Applications shall be in writing and
shall be (i) delivered in hand, (ii) mailed by United States
registered or certified first class mail, postage prepaid, (iii) sent by
overnight courier, or (iv) sent by telegraph, telecopy, facsimile, email
or telex and confirmed by delivery via courier or postal service, addressed as
follows:

 

if to either Borrower or any of the Guarantors, c/o CHC at 625 Madison
Avenue, New York, NY 10022 Attention: Robert L. Levy, Chief Financial Officer,
facsimile no. 212-593-5796, email rlevy@centerline.com, or at such other United
States address for notice as the Borrowers shall last have furnished in writing
to the Person giving the notice; with a copy to Paul, Hastings, Janofsky &
Walker LLP, 75 E. 55th Street, New York, New York 10022, Attention:
Leslie A. Plaskon, Esq., facsimile no. 212-319-4090, email: leslieplaskon@paulhastings.com;

 

if to the Administrative Agent, at One Federal Street, Mail
Code: MA5-503-04-16, Boston, MA 02110, USA, Attention: John F. Simon, Senior Vice President, facsimile no.
617-346-4670, email: John.F.Simon@bankofamerica.com, with a copy to Binh
Troung, Relationship Administrator, Bank of America, N.A., One Federal
Street, Mail Code: MA5-503-04-16, Boston, MA 02110, USA e-mail: binh.kim.truong@bankofamerica.com, or such other address
for notice as the Administrative Agent shall last have furnished in writing to
the Person giving the notice; and

 

98

 

if to the Issuing Bank, Swingline Lender, or any Lender, at the Issuing
Bank’s, Swingline Lender’s or such Lender’s address for its Domestic Lending
Office set forth on Schedule 2 hereto, or such other address for notice
as such Creditor Party shall have last furnished in writing to the Person giving
the notice.

 

Any such notice or demand shall be deemed to have been duly given or
made and to have become effective (i) if delivered by hand, overnight
courier, email or facsimile to a responsible officer of the party to which it
is directed, at the time of the receipt thereof by such officer or the sending
of such email or facsimile and (ii) if sent by registered or certified
first-class mail, postage prepaid, on the third Business Day following the
mailing thereof.

 

19.       GOVERNING
LAW; JURISDICTION; VENUE.

 

THIS CREDIT AGREEMENT AND, EXCEPT AS OTHERWISE
SPECIFICALLY PROVIDED THEREIN, EACH OF THE OTHER LOAN DOCUMENTS ARE CONTRACTS
UNDER THE LAWS OF THE STATE OF NEW YORK AND SHALL FOR ALL PURPOSES BE CONSTRUED
IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF SAID STATE OF NEW YORK
(EXCLUDING THE LAWS APPLICABLE TO CONFLICTS OR CHOICE OF LAW BUT INCLUDING AND
GIVING EFFECT TO SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS
LAW). EACH OF THE PARTIES HERETO AGREES THAT ANY SUIT FOR THE ENFORCEMENT OF
THIS CREDIT AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS MAY BE BROUGHT IN
THE COURTS OF THE COMMONWEALTH OF MASSACHUSETTS, THE STATE OF NEW YORK, OR ANY
FEDERAL COURT SITTING THEREIN, AND CONSENTS TO THE NONEXCLUSIVE JURISDICTION OF
SUCH COURTS AND SERVICE OF PROCESS IN ANY SUCH SUIT BEING MADE UPON SUCH PARTY
BY MAIL AT THE ADDRESS SPECIFIED IN SECTION 18.  EACH PARTY HERETO 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.

 

20.       HEADINGS.

 

The captions in this Credit Agreement are for convenience of reference
only and shall not define or limit the provisions hereof.

 

21.       COUNTERPARTS.

 

This Credit Agreement and any amendment, modification or restatement
hereof may be executed in several counterparts and by each party on a separate
counterpart, each of which when executed and delivered shall be an original,
and all of which together shall constitute one instrument. In proving this Credit
Agreement it shall not be necessary to produce or account for more than one
such counterpart signed by the party against whom enforcement is sought.
Delivery by facsimile or by other electronic method of transmission by any of
the parties hereto of an executed counterpart hereof or of any amendment,
waiver or restatement hereto shall be as effective as an 

 

99

 

original executed counterpart hereof or of such amendment, waiver or
restatement and shall be considered a representation that an original executed
counterpart hereof or such amendment, waiver or restatement as the case may be,
will be delivered.

 

22.       ENTIRE AGREEMENT, ETC.

 

22.1      Entire Agreement.  The Loan Documents are intended by the
parties as the final, complete and exclusive statement of the transactions
evidenced by the Loan Documents. All prior or contemporaneous promises,
agreements and understandings, whether oral or written, are deemed to be
superseded by the Loan Documents, and no party is relying on any promise,
agreement or understanding not set forth in the Loan Documents.

 

22.2      Additional Guarantors and Pledged Entities.  The Administrative Agent may unilaterally,
from time to time, revise Schedule 1A so as to reflect the addition or
removal of Persons from the definition of Guarantors and Pledged Entities.  The Schedule 1A provided by the
Administrative Agent from time to time shall be conclusively presumed to be
true, accurate correct, and binding upon all of the parties hereto, in the absence
of manifest error.

 

23.       CONSENTS, AMENDMENTS, WAIVERS, ETC.

 

23.1      General Rule.  Any consent or approval required or permitted
by this Credit Agreement to be given by all of the Lenders may be given, and
any term of this Credit Agreement, the other Loan Documents or any other
instrument related hereto or mentioned herein may be amended, and the
performance or observance by either Borrower, any of the Guarantors or any of
their respective Subsidiaries of any terms of this Credit Agreement, the other Loan
Documents or such other instrument or the continuance of any Default may be
waived (either generally or in a particular instance and either retroactively
or prospectively) with, but only with, the written consent of the Required
Lenders. Notwithstanding the foregoing, no consent, approval, amendment,
modification or waiver shall:

 

23.1.1      Affected Lenders.  Without the written consent of each
Borrower, each Guarantor and each Lender directly affected thereby:

 

(a)           reduce or forgive the
principal amount of any Loans or Reimbursement Obligations, or reduce the rate
of interest on the Loans or the amount of the Closing Fees, the Unused Facility
Fee or Letter of Credit Fees (other than interest accruing pursuant to Section 6.13
following the effective date of any waiver by the Required Lenders of the Event
of Default relating thereto);

 

(b)           increase the amount of
the Total Commitment or any Lender’s Revolving Loan Commitment or Term Loan
Commitment (except upon an assignment in accordance with the terms of Section 17)
or extend the expiration date of the Total Commitment or any Lender’s Revolving
Loan Commitment or Term Loan Commitment;

 

100

 

(c)           postpone or extend
either the Revolver Maturity Date or the Term Loan Maturity Date or any other
regularly scheduled dates for payments of principal of, or interest on, any
portion of the Loans or Reimbursement Obligations or any fees or other amounts
payable to such Lender or waive any Event of Default relating thereto (it being
understood that (i) a waiver of the application of the Default Rate, (ii) any
vote to accelerate or to rescind any acceleration made pursuant to Section 11.2.1
of amounts owing with respect to the Loans and other Obligations and (iii) any
modifications of the provisions relating to amounts or timing of prepayments of
Loans and other Obligations shall require only the approval of the Required
Lenders);

 

(d)           release the Borrowers
from any Obligations consisting of principal, interest, fees, reimbursement
obligations, expenses, or indemnities, release all or substantially all of the
Collateral or release all or substantially all of the Guarantors from their
guaranty obligations under the Guaranties (excluding, if either Borrower, any
Guarantor or any of their Subsidiaries becomes a debtor under the federal
Bankruptcy Code, the release of “cash collateral,” as defined in Section 363(a) of
the federal Bankruptcy Code pursuant to a cash collateral stipulation with the
debtor approved by the Required Lenders);

 

(e)           amend the provisions of
Section 4.2.3 with respect to the requirement thereunder that the
outstanding principal amount of the Term Loan will be paid prior to repayment
of the outstanding principal amount of the Revolving Loans; or

 

(f)            amend any provision of
this Credit Agreement calling for the pro rata application of funds to any
Creditor Parties;

 

23.1.2      All Lenders.  Without the written consent of all of the
Lenders, (a) amend or waive this Section or the definition of
Required Lenders, (b) permit an assignment of any rights hereunder by
either Borrower or (c) amend or waive Section 11.4;

 

23.1.3      Administrative Agent, Issuing Bank and Swingline
Lender.  Without the
written consent of the Administrative Agent, and, to the extent affected
thereby, the Issuing Bank and the Swingline Lender, amend or waive Section 2.4,
Section 5 or Section 13, the amount or time of payment
of the Administrative Agent’s Fee or any Letter of Credit Fees payable for the
Administrative Agent’s or the Issuing Bank’s account or any other provision
applicable to the Administrative Agent, the Issuing Bank or the Swingline
Lender; or

 

23.1.4      Upon Change in Administrative Agent, Swingline Lender
or Issuing Bank.  In the
event of any change in the Person acting as the Administrative Agent, the
Issuing Bank or the Swingline Lender hereunder, without the written consent of
the Person formerly acting as such, amend or waive any provision of this Credit
Agreement accruing to 

 

101

 

the benefit of such Person in respect of all actions
taken or omitted to be taken by either of them prior to such change.

 

23.2      Waivers.  No waiver shall extend to or affect any
obligation not expressly waived or impair any right consequent thereon. No
course of dealing or delay or omission on the part of the Administrative Agent,
the Issuing Bank, the Swingline Lender or any Lender in exercising any right
shall operate as a waiver thereof or otherwise be prejudicial thereto. No
notice to or demand upon the Borrowers or any Guarantor shall entitle such
Person to other or further notice or demand in similar or other circumstances.

 

23.3      Reasonable Cooperation by Creditor Parties.  If and to the extent that the written consent
of the Required Lenders, all of the Lenders, the Swingline Lenders or the
Issuing Bank, respectively, is required to take any of the actions contemplated
by this Section, and the Administrative Agent has given such consent, none of
the other Creditor Parties entitled to give or withhold their consent shall
unreasonably withhold, condition or delay its decision regarding the giving of
any such consent.

 

23.4      Amendments Requiring Freddie Mac’s Consent. 
Until such time as the Unfunded Escrow is reduced to zero Dollars,
Freddie Mac’s prior written consent (which shall not be unreasonably withheld)
shall be required prior to (a) increasing the Applicable Margin or any
Default Rate, (b) accelerating the amortization schedule regarding the
Term Loan (other than during the existence of an Event of Default, (c) revising
any of Sections 10.14, 10.15 or 10.16 so as to be more restrictive on
the Borrowers, and (d) amending the provisions of this Section 23.4.  For purposes of clause (b) of
this Section, payments of principal of the Term Loan contemplated by this
Agreement shall not be deemed to be an acceleration.

 

24.       SEVERABILITY.

 

The provisions of this Credit Agreement are severable and if any one
clause or provision hereof shall be held invalid or unenforceable in whole or
in part in any jurisdiction under particular circumstances, then such
invalidity or unenforceability shall affect only such clause or provision, or
part thereof, in such jurisdiction and under such circumstances, and shall not
in any manner affect such clause or provision in any other jurisdiction or
other circumstances, or any other clause or provision of this Credit Agreement
in any jurisdiction. The parties agree that they will negotiate in good faith
to replace any provision hereof so held invalid or unenforceable with a valid
provision which is as similar as possible to the invalid or unenforceable
provision.

 

25.       CONFIDENTIALITY.

 

25.1      Confidentiality.  During such period as any of the Loans remain
outstanding and are not then due and payable and any of the Commitments remain
in effect, and for six months thereafter (and twelve months with respect to proprietary information of CFin
disclosed hereunder), each of the Creditor Parties agrees to maintain the
confidentiality of the Information (as defined below), except that Information
may 

 

102

 

be disclosed (a) to its Affiliates and to its and
its Affiliates’ respective Related Parties in connection with this Credit
Agreement and the transactions contemplated hereby (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
purporting to have jurisdiction over it (including any self-regulatory
authority), (c) to the extent required by applicable laws or regulations
or by any subpoena or similar legal process, (d) to any other party
hereto, (e) to the extent required to exercise any remedies hereunder or
under any other Loan Document or to take any action or proceeding relating to
this Credit 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 assignee of or
participant in, or any prospective assignee of or participant in, any of its
rights or obligations under this Credit Agreement or (ii) any actual or
prospective counterparty (or its advisors) to any swap or derivative
transaction relating to either Borrower or a Guarantor and their respective
Obligations, (g) with the consent of CHC or (h) to the extent such
Information (i) becomes publicly available other than as a result of a
breach of this Section or (ii) becomes available to any Creditor
Party or any of their respective Affiliates on a nonconfidential basis from a
source other than either Borrower or a Guarantor.

 

25.2      Definition of Information.  For purposes of this Section, “Information”
means all confidential information received from either Borrower or any
Guarantor relating to either Borrower, any Guarantor or any Pledged Entity or
any of their respective businesses, other than any such information that is
available to any Creditor Party or an Affiliate of such Creditor Party on a
nonconfidential basis prior to disclosure by either Borrower, any Guarantor or
any Pledged Entity, or subsequently becomes available on such basis.  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.

 

25.3      Compliance Standard.  Each of the Creditor Parties acknowledges
that (a) the Information may include material non-public information
concerning the Borrowers, the Guarantors, and their Subsidiaries, as the case
may be, (b) it has developed compliance procedures regarding the use of
material non-public information and (c) it will handle such material
non-public information in accordance with applicable law, including federal and
state securities laws. To the extent practicable and possible in compliance
with applicable law, regulation, proceeding or court order, each of the
Creditor Parties shall, prior to disclosure thereof, notify the Borrowers of
any request for disclosure of any such non-public information by any
governmental agency or representative thereof (other than any such request in
connection with an examination of the financial condition of such Creditor
Party by such governmental agency) or pursuant to legal process.

 

103

 

25.4      Intralinks and Public Lenders.  The Borrowers and the Guarantors hereby
acknowledge that (a) the Administrative Agent will make available to the
other Creditor Parties materials and/or information provided by or on behalf of
the Borrowers and the Guarantors hereunder (collectively, “Borrower Materials”)
by posting the Borrower Materials on IntraLinks or another similar electronic
system (the “Platform”) and (b) certain of the Lenders may be “public-side”
Lenders (i.e., Lenders that do not wish to receive material non-public information
with respect to the Borrowers or their securities) (each, a “Public Lender”).
The Borrowers and the Guarantors hereby agree that (w) all Borrower
Materials that are to be made available to Public Lenders shall be clearly and
conspicuously marked “PUBLIC” which, at a minimum, shall mean that the word “PUBLIC”
shall appear prominently on the first page thereof; (x) by marking
Borrower Materials “PUBLIC,” the Borrowers and the Guarantors shall be deemed
to have authorized the Creditor Parties to treat such Borrower Materials as not
containing any material non-public information with respect to the Borrowers
and the Guarantors or their securities for purposes of United States Federal
and state securities laws (provided, however, that to the extent
such Borrower Materials constitute Information, they shall be treated as set
forth in this Section); (y) all Borrower Materials marked “PUBLIC” are
permitted to be made available through a portion of the Platform designated “Public
Investor”; and (z) the Administrative Agent shall be entitled to treat any
Borrower Materials that are not marked “PUBLIC” as being suitable only for
posting on a portion of the Platform not designated “Public Investor.”

 

26.       USA
PATRIOT ACT.

 

Each Creditor Party hereby notifies the Borrowers 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 each Borrower, which information includes
the name and address of the Borrowers and other information that will allow
such Creditor Party to identify the Borrowers in accordance with the Act.

 

27.       NO
ADVISORY OR FIDUCIARY RESPONSIBILITY.

 

In connection with all aspects of each
transaction contemplated hereby, the Borrowers and the Guarantors acknowledge
and agree, and acknowledge the understanding of each Person included in the
Centerline Group, that: (i) the Loans provided for hereunder and any
related arranging or other services in connection therewith (including in
connection with any amendment, waiver, restatement or other modification hereof
or of any other Loan Document) are an arm’s-length commercial transaction
between the Borrowers, the Guarantors and their respective Affiliates, on the one
hand, and the Administrative Agent, on the other hand, and the Borrowers and
the Guarantors are each capable of evaluating and understanding and understand
and accept the terms, risks and conditions of the transactions contemplated
hereby and by the other Loan Documents (including any amendment, waiver,
restatement or other modification hereof or thereof); (ii) in connection
with the process leading to such transaction, the Administrative Agent is and
has been acting solely as a principal and is not the agent, fiduciary, or
financial advisor for the Borrowers, the Guarantors or any of their respective
stockholders, creditors or employees, 

 

104

 

any other Person in the Centerline Group or
any other Person; (iii) the Administrative Agent has not assumed or will
not assume an agency, fiduciary, or advisory responsibility in favor of the
Borrowers or any Guarantor, or any other Person in the Centerline Group, with
respect to any of the transactions contemplated hereby or the process leading
thereto, including with respect to any amendment, restatement, waiver or other
modification hereof or of any other Loan Document (irrespective of whether the
Administrative Agent has advised or is currently advising either Borrower, any
Guarantor or any other Person in the Centerline Group on other matters) and the
Administrative Agent has no obligation to either Borrower, any Guarantor or any
other Person in the Centerline Group with respect to the transactions
contemplated hereby except those obligations expressly set forth herein and in
the other Loan Documents; (iv) the Administrative Agent and its Affiliates
may be engaged in a broad range of transactions that involve interests that
differ from those of the Borrowers, the Guarantors or other Persons in the
Centerline Group, and the Administrative Agent has no obligation to disclose
any of such interests by virtue of any advisory, agency or fiduciary
relationship; and (v) the Administrative Agent has not provided and will
not provide any legal, accounting, regulatory or tax advice with respect to any
of the transactions contemplated hereby (including any amendment, waiver,
restatement or other modification hereof or of any other Loan Document) and the
Borrowers and the Guarantors have consulted their own legal, accounting,
regulatory and tax advisors to the extent they have deemed appropriate.  Each of the Borrowers and the Guarantors
hereby waives and releases, to the fullest extent permitted by law, any claims
that it may have against the Administrative Agent with respect to any breach or
alleged breach of agency or fiduciary duty.

 

28.       DESIGNATION
OF PERMITTED LIENS.

 

The designation of a Lien as a Permitted Lien is not, and shall not be
deemed to be, an acknowledgment by any Creditor Party to any Person that the
Lien shall have priority over any Lien of the Administrative Agent granted in
any Loan Document for the benefit of the other Creditor Parties.

 

29.       WAIVER
OF JURY TRIAL.

 

EACH PARTY HERETO MUTUALLY HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVES ITS RIGHT TO A JURY TRIAL WITH RESPECT TO ANY ACTION OR
CLAIM BASED HEREON ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS CREDIT
AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS, ANY RIGHTS OR OBLIGATIONS
HEREUNDER OR THEREUNDER OR THE PERFORMANCE OF SUCH RIGHTS AND OBLIGATIONS OR
ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS (WHETHER VERBAL OR
WRITTEN) OR ACTIONS OF ANY PARTY, INCLUDING ANY COURSE OF CONDUCT, COURSE OF
DEALINGS, STATEMENTS OR ACTIONS OF THE ADMINISTRATIVE AGENT OR ANY LENDER
RELATING TO THE ADMINISTRATION OF THE LOANS OR ENFORCEMENT OF THE LOAN
DOCUMENTS, ARISING UNDER CONTRACT, TORT, STRICT LIABILITY OR ANY OTHER LAW OR
AT EQUITY, AND AGREES THAT IT WILL NOT SEEK TO CONSOLIDATE ANY SUCH ACTION WITH
ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT BE OR HAS NOT BEEN WAIVED. Except as prohibited by law, each party
hereto hereby waives any right it may have to claim or recover in any
litigation 

 

105

 

referred
to in the preceding sentence any special, exemplary, punitive or consequential
damages or any damages other than, or in addition to, actual damages. Each
Borrower and each Guarantor (i) certifies that no representative, agent or
attorney of any Creditor Party has represented, expressly or otherwise, that
such Creditor Party would not, in the event of litigation, seek to enforce the
foregoing waivers and (ii) acknowledges that this waiver constitutes a
material inducement for the Creditor Parties to execute this Credit Agreement
and make the Loans and issue Letters of Credit.

 

[Signatures Appear on Next Page]

 

106

 

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

 

	
   

  	
  BORROWERS:

  
	
   

  	
   

  
	
   

  	
  CENTERLINE HOLDING COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Marc D. Schnitzer

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Marc D. Schnitzer

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Chief Executive Officer and President

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CENTERLINE CAPITAL GROUP INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Marc D. Schnitzer

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Marc D. Schnitzer

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Chief Executive Officer

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  GUARANTORS:

  
	
   

  	
   

  
	
   

  	
  CENTERLINE
  INVESTOR LP LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Andrew J. Weil

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Andrew J. Weil

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Chief Executive Officer

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CENTERLINE
  INVESTOR LP II LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Andrew J. Weil

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Andrew J. Weil

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Chief Executive Officer

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CENTERLINE CAPITAL COMPANY LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Marc D. Schnitzer

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Marc D. Schnitzer

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Chief Executive Officer

  	
   

  
						

 

1

 

	
   

  	
  CENTERLINE AFFORDABLE HOUSING ADVISORS

  
	
   

  	
  LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Andrew J. Weil

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Andrew J. Weil

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Chief Executive Officer

  	
   

  
	
   

  	
   

  
	
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2

 

	
   

  	
  CENTERLINE/AC INVESTORS LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Marc D. Schnitzer

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Marc D. Schnitzer

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Chief Executive Officer

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CENTERLINE HOLDING TRUST

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Marc D. Schnitzer

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Marc D. Schnitzer

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Chief Executive Officer

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CENTERLINE INVESTORS I LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Marc D. Schnitzer

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Marc D. Schnitzer

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Chief Executive Officer

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CENTERLINE REIT INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Paul Smyth

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Paul Smyth

  	
   

  
	
   

  	
   

  	
  Title:

  	
  President and COO

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CENTERLINE SERVICING INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Paul Smyth

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Paul Smyth

  	
   

  
	
   

  	
   

  	
  Title:

  	
  President and COO

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CENTERLINE FINANCE CORPORATION

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Paul Smyth

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Paul Smyth

  	
   

  
	
   

  	
   

  	
  Title:

  	
  President and COO

  	
   

  
	
   

  	
   

  
	
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3

 

	
   

  	
  CENTERLINE CREDIT MANAGEMENT LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Nicholas Mumford

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Nicholas Mumford

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Executive Managing Director

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CM INVESTOR LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Marc D. Schnitzer

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Marc D. Schnitzer

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Chief Executive Officer

  	
   

  
						

 

4

 

	
   

  	
  AGENTS, ADMINISTRATIVE AGENT AND 

  LENDERS:

  	 

	
   

  	
   

  	 

	
   

  	
  BANK OF AMERICA, N.A., as the
  Administrative Agent, 

  as the Issuing Bank, as the Swingline Lender, and as a 

  Lender

  	 

	
   

  	
   

  	 

	
   

  	
  By:

  	
  /s/ John F. Simon

  	
   

  	 

	
   

  	
   

  	
  Name:

  	
  John F. Simon

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Senior Vice President

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
  CITICORP USA, INC., as a Lender

  	 

	
   

  	
   

  	 

	
   

  	
  By:

  	
  /s/ Maria McKeon

  	
   

  	 

	
   

  	
   

  	
  Name:

  	
  Maria McKeon

  	
   

  	 

	
   

  	
   

  	
  Title:

  	
  Vice President

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
  COMERICA BANK, as a Lender

  	 

	
   

  	
   

  	 

	
   

  	
  By:

  	
  /s/ Lisa Kotula

  	
   

  	 

	
   

  	
   

  	
  Name:

  	
  Lisa Kotula

  	
   

  	 

	
   

  	
   

  	
  Title:

  	
  Vice President

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
  MLBUSA COMMUNITY DEVELOPMENT CORP., 

  as a Lender

  	 

	
   

  	
   

  	 

	
   

  	
  By:

  	
  /s/ Michael L. Solomon

  	
   

  	 

	
   

  	
   

  	
  Name:

  	
  Michael L. Solomon

  	
   

  	 

	
   

  	
   

  	
  Title:

  	
  Director

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
  MORGAN STANLEY BANK, as a Lender

  	 

	
   

  	
   

  	 

	
   

  	
  By:

  	
  /s/ Daniel Twenge

  	
   

  	 

	
   

  	
   

  	
  Name:

  	
  Daniel Twenge

  	
   

  	 

	
   

  	
   

  	
  Title:

  	
  Authorized Signatory

  	
   

  	 

	
   

  	
   

  	 

	
  [Signatures
  Continue on Next Page]

  	 

											

 

5

 

	
   

  	
  TABERNA PREFERRED FUNDING VIII LTD.,

  as a Lender

  
	
   

  	
   

  
	
   

  	
  By: 
  Taberna Capital Management LLC, as collateral 

  manager

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ James J. Sebra

  	
   

  
	
   

  	
   

  	
  Name:

  	
  James J. Sebra

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Senior Vice President and CAO

  	
   

  
						

 

1693399.1

 

6ex101.htm

    SUBSCRIPTION
      AGREEMENT

     

    

     

    FOR
      THE

     

    

     

    PURCHASE
      OF UNITS OF

     

    Phoenix
      International Ventures, Inc.

    

    (each
      Unit consists of two shares of common stock and one Warrant to purchase one
      share)

    

    November     ,
      2007

     

    
      
         

      

      
        -1-

        
          

        

      

      
         

      

    

    PHOENIX
      INTERNATIONAL VENTURES, INC.

    

    SUBSCRIPTION
      AGREEMENT FOR THE PURCHASE OF UNITS

    

    PHOENIX
      INTERNATIONAL VENTURES, INC., a
Nevadacorporation
      (the “Company”)
      is offering (this “Offering”)for
      sale to certain individuals (the
“Investors”)  up
      to 350,000 units (the
“Offering”).  Each Unit consists of two shares of common stock and one
      warrant to purchase common stock (the “Warrants”).  Each Warrant is
      excercisable for a period of two years at an exercise price of $1.00 per
      share.  The Units are offered at $1.40 per Unit.

     

    The
      subscription for the Units will be made in accordance with and subject to the
      terms and conditions of this Subscription Agreement.  The minimum
      investment amount that may be purchased by an Investor is $5,600 worth of Units
      (4,000 Units) (the “Minimum
      Investor Purchase”); provided
      however, the
      Company may in its sole discretion, accept an Investor subscription for an
      amount less than the Minimum Investor Purchase.

     

    The
      Shares of Common Stock and the shares underlying the Warrants (the “Warrant
      Shares”) are entitled to certain registration rights as provided herein

     

    The
      Company will offer the Units to no more than 35 investors who are not
“accredited investors” (as defined in Rule 501 of Regulation D promulgated under
      the Securities Act of 1933, as amended (the “Securities
      Act”)).

     

    Although
      the Units will be offered by the Company’s officers, directors and employees,
      who will receive no direct compensation for selling such Units, the Company
      may
      use registered broker/dealers and others (“Agents”)
      to place Units and may pay to such persons a commission of up to 10% of the
      investment.  The Offering will terminate on December 31, 2007 unless
      extended by the Company in its sole discretion to a date no later than January
      31, 2008.

     

    The
      Company and the Agents, if any, may (but are not obligated to) purchase and/or
      have their respective employees, agents, officers, directors and affiliates
      subscribe and purchase Units in the Offering.  The Company is
      currently indebted to Zahir Teja, the Company’s president, in the amount of
      $509,000.  Mr. Teja may, but is not obligated to, convert a portion of
      such indebtedness (not to exceed $150,000) on the same terms as set forth herein
      ($1.40 per Unit).  If the Company rejects a subscription, either in
      whole or in part (which decision is in their sole discretion), the rejected
      subscription funds or the rejected portion thereof will be returned promptly
      to
      such subscriber without interest accrued thereon.

     

    Questions
      regarding completion of the
      subscription documents should be directed to Niv Nissenson
      at   [775 882 9700 or 775 843 3381 or niv_nissenson@yahoo.com]

     

    

     

    
      
         

      

      
        -2-

        
          

        

      

      
         

      

    

    

     

    NASAA
      UNIFORM LEGEND

     

    IN
      MAKING AN INVESTMENT DECISION INVESTORS MUST RELY ON THEIR OWN EXAMINATION
      OF
      THE COMPANY AND THE TERMS OF THE OFFERING, INCLUDING THE MERITS AND RISKS
      INVOLVED. THESE SECURITIES HAVE NOT BEEN RECOMMENDED BY ANY FEDERAL OR STATE
      SECURITIES COMMISSION OR REGULATORY AUTHORITY. FURTHERMORE, THE FOREGOING
      AUTHORITIES HAVE NOT CONFIRMED THE ACCURACY OR DETERMINED THE ADEQUACY OF THIS
      DOCUMENT. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

     

    
      
         

      

      
        -3-

        
          

        

      

      
         

      

    

    

    

    Phoenix
      International Ventures,
      Inc.

    2201
      Lockhead Way

    Carson
      City, NV 89706

    

    Ladies
      and Gentlemen:

     

    1.      Subscription.  The
      undersigned (the “Subscriber”),
      intending to be legally bound, hereby irrevocably agrees to purchase such number
      of Units (the “Units”),
      of Phoenix International Ventures, Inc. (the “Company”)
      at a purchase price of $1.40 per Unit as set forth on the Signature page to
      this
      Subscription Agreement.   This subscription is
      submitted to you in
      accordance with and subject to the terms and conditions of this Subscription
      Agreement and the Company’s Confidential Private Placement Memorandum used for
      the Offering (the “Memorandum”).  The
      Company is offering up to 350,000 Units.  The Offering is being made
      pursuant to Regulation D promulgated under the Securities Act of 1933, as
      amended (the “Securities Act”).

     

    The
      Shares and the shares of common stock underlying the Warrants (the “Warrant
      Shares”) are entitled to certain registration rights as provided herein.

     

    2.           
      Payment.  The
      Subscriber encloses herewith a check payable to, or will immediately make a
      wire
      transfer payment to, “Phoenix International Ventures, Inc.” in the full amount
      of the purchase price of the Units being subscribed for.  Together
      with the check for, or wire transfer of, the full purchase price, the Subscriber
      is delivering a completed and executed Omnibus Signature Page to this
      Subscription Agreement along with a completed and executed Accredited Investor
      Certification, annexed hereto as Annex
      A.

     

    3.           
      Acceptance of
      Subscription.  The Subscriber understands and agrees that the
      Company, in itssole discretion, reserves the right to accept or reject this
      or
      any other subscription for the Units, in whole or in part, notwithstanding
      prior
      receipt by the Subscriber of notice of acceptance of this or any other
      subscription.  The Company will have no obligation hereunder until the
      Company executes and delivers to the Subscriber an executed copy of this
      Subscription Agreement.  If Subscriber’s subscription is rejected in
      whole or the Offering is terminated, all funds received from the Subscriber
      will
      be returned without interest, penalty, expense or deduction, and this
      Subscription Agreement will thereafter be of no further force or
      effect.  If Subscriber’s subscription is rejected in part, the funds
      for the rejected portion of such subscription will be returned without interest,
      penalty, expense or deduction, and this Subscription Agreement will continue
      in
      full force and effect to the extent such subscription was accepted.

     

    4.           
      Representations and Warranties
      of the Subscriber.  The Subscriber hereby acknowledges,
      represents, warrants, and agrees as follows:

     

    (a) None
      of
      the Units or the underlying Shares are registered under the Securities Act
      of
      1933, as amended (the “Securities
      Act”), or any state securities laws.  The Subscriber
      understands that the offering and sale of the Shares is intended to be exempt
      from registration under the Securities Act, by virtue of Section 4(2) thereof
      and the provisions of Regulation D promulgated thereunder, based, in part,
      upon
      the representations, warranties and agreements of the Subscriber contained
      in
      this Subscription Agreement;

     

    (b) The
      Subscriber and the Subscriber’s attorney, accountant, purchaser representative
      and/or tax advisor, if any (collectively, “Advisors”),
      have received this Subscription Agreement and all other documents requested
      by
      the Subscriber or its Advisors, if any, have carefully reviewed them and
      understand the information contained therein, prior to the execution of this
      Subscription Agreement;

     

    (c) Neither
      the Securities and Exchange Commission (the “Commission”)
      nor any state securities commission has approved the Offering or any of the
      Securities, or passed upon or endorsed the merits of the Offering or confirmed
      the accuracy or determined the adequacy of the Offering.  The Offering
      has not

     

    
      
         

      

      
        -4-

        
          

        

      

      
         

      

    

    (d) been
      reviewed by any federal, state or other regulatory authority.  Any
      representation to the contrary is a criminal offense.  The Units, and
      securities comprising the Units are subject to restrictions on transferability
      and resale and may not be transferred or resold except as permitted under the
      Securities Act, and the applicable state securities laws, pursuant to
      registration or exemption therefrom.  Investors should be aware that
      they will be required to bear the financial risks of this investment for an
      indefinite period of time;

     

    (e) All
      documents, records, and books pertaining to the investment in the Units have
      been made available for inspection by the Subscriber and its Advisors, if
      any;

     

    (f) The
      Subscriber and its Advisors, if any, have had a reasonable opportunity to ask
      questions of and receive answers from a person or persons acting on behalf of
      the Company concerning the offering of the Units and the business, financial
      condition, results of operations and prospects of the Company, and all such
      questions have been answered by the Company to the full satisfaction of the
      Subscriber and its Advisors, if any;

     

    (g) In
      evaluating the suitability of an investment in the Company, the Subscriber
      has
      not relied upon any representation or other information (oral or written) other
      than as stated herein;

     

    (h) The
      Subscriber is unaware of, is in no way relying on, and did not become aware
      of
      the Offering directly and/or indirectly through or as a result of, any form
      of
      general solicitation or general advertising including, without limitation,
      any
      press release, filing by the Company with the Commission, article, notice,
      advertisement or other communication published in any newspaper, magazine or
      similar media or broadcast over television, radio or over the internet, in
      connection with the Offering and sale of the Units and is not subscribing for
      Units and did not become aware of the offering through or as a result of any
      seminar or meeting to which the Subscriber was invited by, or any solicitation
      of a subscription by, a person not previously known to the Subscriber in
      connection with investments in securities generally;

     

    (i) The
      Subscriber has taken no action which would give rise to any claim by any person
      for brokerage commissions, finders’ fees or the like relating to this
      Subscription Agreement or the transactions contemplated hereby (other than
      commissions to be paid by the Company to any agents);

     

    (j) The
      Subscriber, either alone or together with its Advisors, if any, have such
      knowledge and experience in financial, tax, and business matters, and, in
      particular, investments in securities, so as to enable them to utilize the
      information made available to them in connection with the offering of the Units
      to evaluate the merits and risks of an investment in the Units and the Company
      and to make an informed investment decision with respect thereto;

     

    (k) The
      Subscriber is not relying on the Company, any Agent or any of their respective
      employees or agents with respect to the legal, tax, economic and related
      considerations of an investment in the Units, and the Subscriber has relied
      on
      the advice of, or has consulted with, only its own Advisors;

     

    (l) The
      Subscriber is acquiring the Units (and the securities included therein) solely
      for such Subscriber’s own account for investment and not with a view to resale
      or distribution thereof, in whole or in part.  The Subscriber has no
      agreement or arrangement, formal or informal, with any person to sell or
      transfer all or any of the securities and the Subscriber has no plans to enter
      into any such agreement or arrangement;

     

    (m) The
      purchase of the Units represents high risk capital and the Subscriber is able
      to
      afford an investment in a speculative venture having the risks and objectives
      of
      the Company.  The Subscriber must bear the substantial economic risks
      of the investment in the Units indefinitely because none of the securities
      included in the Units may be sold, hypothecated or otherwise disposed of unless
      subsequently registered under the Securities Act and applicable state securities
      laws or an exemption from such registration is available.  Legends
      will be placed on the Securities to the effect that they have not been
      registered under the Securities Act or applicable state securities laws and
      appropriate notations thereof will be made in the Company’s stock
      books.

     

    
      
         

      

      
        -5-

        
          

        

      

      
         

      

    

    (n) The
      Company has agreed that purchasers of the Units will have, with respect to
      the
      Units the registration rights described herein.  Notwithstanding such registration
      rights, trading volume in the Common Stock is extremely limited and sporadic
      and
      as such, there is currently limited liquidity in the Common Stock and there
      can
      be no assurance when, if ever, a more liquid market for the Common Stock will
      develop; or if any registration statement covering the underlying shares will
      be
      declared effective by the SEC;

     

    (o) The
      Subscriber has adequate means of providing for such Subscriber’s current
      financial needs and foreseeable contingencies and has no need for liquidity
      of
      the investment in the Units for an indefinite period of time;

     

    (p) The
      Subscriber is aware that an investment in the Units involves a number of very
      significant risks and has carefully read and considered the matters set forth
      herein; and in the Risk Factors attached as Annex B;

     

    (q) The
      Subscriber has truthfully and accurately completed the Accredited Investor
      Certification contained herein;

     

    (r) The
      Subscriber: (i) if a natural person, represents that the Subscriber has reached
      the age of 21 and has full power and authority to execute and deliver this
      Subscription Agreement and all other related agreements or certificates and
      to
      carry out the provisions hereof and thereof; (ii) if a corporation, partnership,
      or limited liability company or partnership, or association, joint stock
      company, trust, unincorporated organization or other entity, represents that
      such entity was not formed for the specific purpose of acquiring the Units,
      such
      entity is duly organized, validly existing and in good standing under the laws
      of the state of its organization, the consummation of the transactions
      contemplated hereby is authorized by, and will not result in a violation of
      state law or its charter or other organizational documents, such entity has
      full
      power and authority to execute and deliver this Subscription Agreement and
      all
      other related agreements or certificates and to carry out the provisions hereof
      and thereof and to purchase and hold the securities constituting the Units,
      the
      execution and delivery of this Subscription Agreement has been duly authorized
      by all necessary action, this Subscription Agreement has been duly executed
      and
      delivered on behalf of such entity and is a legal, valid and binding obligation
      of such entity; or (iii) if executing this Subscription Agreement in a
      representative or fiduciary capacity, represents that it has full power and
      authority to execute and deliver this Subscription Agreement in such capacity
      and on behalf of the subscribing individual, ward, partnership, trust, estate,
      corporation, or limited liability company or partnership, or other entity for
      whom the Subscriber is executing this Subscription Agreement, and such
      individual, partnership, ward, trust, estate, corporation, or limited liability
      company or partnership, or other entity has full right and power to perform
      pursuant to this Subscription Agreement and make an investment in the Company,
      and represents that this Subscription Agreement constitutes a legal, valid
      and
      binding obligation of such entity.  The execution and delivery of this
      Subscription Agreement will not violate or be in conflict with any order,
      judgment, injunction, agreement or controlling document to which the Subscriber
      is a party or by which it is bound;

     

    (s) The
      Subscriber represents to the Company that any information which the undersigned
      has heretofore furnished or is furnishing herewith to the Company or any Agent
      is complete and accurate and may be relied upon by the Company in determining
      the availability of an exemption from registration under Federal and state
      securities laws in connection with the Offering as described in the
      Memorandum.  The Subscriber further represents and warrants that it
      will notify and supply corrective information to the Company immediately upon
      the occurrence of any change therein occurring prior to the Company’s issuance
      of the Units;

     

    (t) The
      Subscriber has significant prior investment experience, including investments
      in
      private, non-traded, non-listed and non-registered securities.  The
      Subscriber is knowledgeable about investments in small and thinly capitalized
      businesses.  The Subscriber has a sufficient net worth to sustain a
      loss of its entire investment in the Company in the event such a loss should
      occur.  The Subscriber’s overall commitment to investments which are
      not readily marketable is not excessive in view of the Subscriber’s
      net

     

    
      
         

      

      
        -6-

        
          

        

      

      
         

      

    

    (u) worth
      and
      financial circumstances and the purchase of the Securities will not cause such
      commitment to become excessive.  This investment in the Company’s
      Securities is a suitable one for the Subscriber;

     

    (v) No
      oral
      or written representations have been made, or oral or written information
      furnished, to the Subscriber or its Advisors, if any, in connection with the
      Offering which are in any way inconsistent with the information contained in
      the
      Memorandum;

     

    (w) Within
      five (5) days after receipt of a request from the Company, the Subscriber will
      provide such information and deliver such documents as may reasonably be
      necessary to comply with any and all laws and ordinances to which the Company
      is
      subject;

     

    (x) THE
      SECURITIES OFFERED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
      OR
      THE SECURITIES LAWS OF ANY STATES AND ARE BEING OFFERED AND SOLD IN RELIANCE
      ON
      EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF SAID ACT AND SUCH
      LAWS.  THE SHARES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND
      RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER SAID
      ACT
      AND SUCH LAWS PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.  THE
      SHARES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE COMMISSION, ANY STATE
      SECURITIES COMMISSION OR ANY OTHER REGULATORY AUTHORITY, NOR HAVE ANY OF THE
      FOREGOING AUTHORITIES PASSED UPON OR ENDORSED THE MERITS OF THIS OFFERING OR
      THE
      ACCURACY OR ADEQUACY OF THIS AGREEMENT.  ANY REPRESENTATION TO THE
      CONTRARY IS UNLAWFUL;

     

    (y) The
      Subscriber hereby represents, warrants, agrees and covenants to and with the
      Company that the Subscriber has not, directly and/or indirectly, previously
      had
      and/or maintained and/or currently has, and/or in the future will not make
      or
      maintain a “short” position in the Company’s securities and will not encourage
      and/or facilitate the same by any third party.

     

    (z) The
      Subscriber has read this Agreement in its entirety including, but not limited
      to, the Section therein entitled “Risk Factors,” and understands fully to its
      full satisfaction all information and terms included in this
      Agreement.  The subscriber also acknowledges that they have reviewed
      the Company’s 10-QSB for the quarter ended September 30, 2007 as filed with the
      SEC.

     

    5.           
      Representations and Warranties
      of the Company.  The Company hereby acknowledges, represents,
      warrants, and agrees as follows:

     

    (aa) The
      Company is an entity duly organized, validly existing and in good standing
      under
      the laws of the state of its incorporation with the requisite corporate power
      and authority to own and use its properties and assets and to carry on its
      business as currently conducted.  The Company is not in violation of
      any of the provisions of its certificate of formation, by-laws or other
      organizational or charter documents including, but not limited to, all documents
      setting forth and/or establishing the terms, rights, conditions and/or
      limitations of any of the Company’s Common Stock and (the “Internal
      Documents”).  The Company is duly qualified to conduct business
      and is in good standing as a foreign corporation in each jurisdiction in which
      the nature of the business conducted or property owned by it makes such
      qualification necessary, except where the failure to be so qualified or in
      good
      standing, as the case may be, would not result in a direct and/or indirect
      (i)
      material adverse effect on the legality, validity or enforceability of any
      of
      the Securities and/or this Subscription Agreement, (ii) material adverse effect
      on the results of operations, assets, business or financial condition of the
      Company, or (iii) material adverse effect on the Company’s ability to perform in
      any material respect on a timely basis its obligations under this Subscription
      Agreement.

     

    
      
         

      

      
        -7-

        
          

        

      

      
         

      

    

    (bb) The
      Company has the requisite corporate power and authority to enter into and to
      consummate the transactions contemplated herein and otherwise to carry out
      its
      obligations hereunder.  The execution and delivery of this Agreement
      and the consummation by it of the transactions contemplated hereby have been
      duly authorized by all necessary action on the part of the Company and no
      further corporate action is required by the Company in connection
      therewith.  This Agreement has been (or upon delivery will have been)
      duly executed by the Company and, when delivered in accordance with the terms
      hereof, will constitute the valid and binding obligation of the Company
      enforceable against the Company in accordance with its terms except as limited
      by applicable bankruptcy, insolvency, reorganization, moratorium and other
      laws
      of general application affecting enforcement of creditors’ rights
      generally.

     

    (cc) The
      execution, delivery and performance of the condition of this Agreement by the
      Company and the consummation by the Company of the transactions contemplated
      thereby, do not and will not (i) conflict with or violate any provision of
      the
      Company’s Internal Documents, (ii) conflict with, or constitute a default (or an
      event that with notice or lapse of time or both would become a default) under,
      or give to others any rights of termination, amendment, acceleration or
      cancellation (with or without notice, lapse of time or both) of, any material
      agreement, credit facility, debt or other instrument (evidencing a Company
      debt
      or otherwise), or other understanding to which the Company is a party or by
      which any property or asset of the Company is bound or affected, or (iii) result
      in a violation of any law, rule, regulation, order, judgment, injunction, decree
      or other restriction of any court or governmental authority to which the Company
      is subject (including federal and state securities laws and regulations), or
      by
      which any property or asset of the Company is bound or affected.

     

    (dd) The
      Company has an aggregate of 7,096,000 shares of common stock issued and
      outstanding as of the date hereof.

     

    (ee) The
      Company will utilize any proceeds raised in the Offering for working capital
      and
      the repayment of its currently existing indebtedness.

     

    (ff) Piggyback
      Registration Rights.  If, at any time during
      the
      period ending two years from the date hereof there is not an effective
      Registration Statement covering the Shares and the Warrant Shares (for purposes
      of this Section, the “Registration Securities”) and the Company shall determine
      to prepare and file with the Commission a registration statement relating to
      an
      offering for its own account or the account of others under the Securities
      Act
      of any of its equity securities, other than on Form S-4 or Form S-8 (each as
      promulgated under the Securities Act) or any post-effective amendment to
      existing registration statements or their then equivalents relating to equity
      securities to be issued solely in connection with any acquisition of any entity
      or business or equity securities issuable in connection with stock option or
      other employee benefit plans, then the Company shall send to each Holder a
      written notice of such determination at least twenty (20) days prior to the
      filing of any such registration statement and shall include in such registration
      statement all Registrable Securities; provided, however, that (i) if, at
      any time after giving written notice of its intention to register any securities
      and prior to the effective date of the registration statement filed in
      connection with such registration, the Company determines for any reason not
      to
      proceed with such registration, the Company will be relieved of its obligation
      to register any Registrable Securities in connection with such registration,
      and
      (ii) in case of a determination by the Company to delay registration of its
      securities, the Company will be permitted to delay the registration of
      Registrable Securities for the same period as the delay in registering such
      other securities.

     

    6.           
      Indemnification.  The
      Subscriber agrees to indemnify and hold harmless the Company, any Agents and
      each of their respective officers, directors, employees, agents, attorneys,
      control persons and affiliates from and against all losses, liabilities, claims,
      damages, costs, fees and expenses whatsoever (including, but not limited to,
      any
      and all expenses incurred in investigating, preparing or defending against
      any
      litigation commenced or threatened) based upon or arising out of any actual
      or
      alleged false acknowledgment, representation or warranty, or misrepresentation
      or omission to state a material fact, orbreach by the
      Subscriber of any covenant or agreement made by the Subscriber herein or in
      any
      other document delivered by or on behalf of the Subscriber in connection with
      this Subscription Agreement.

     

    
      
         

      

      
        -8-

        
          

        

      

      
         

      

    

     

    7.           
      Irrevocability; Binding
      Effect.  The Subscriber hereby acknowledges and agrees that the
      subscription hereunder is irrevocable by the Subscriber, except as required
      by
      applicable law, and that this Subscription Agreement will survive the death
      or
      disability of the Subscriber and will be binding upon and inure to the benefit
      of the parties and their heirs, executors, administrators, successors, legal
      representatives, and permitted assigns.  If the Subscriber is more
      than one person, the obligations of the Subscriber hereunder will be joint
      and
      several and the agreements, representations, warranties and acknowledgments
      herein will be deemed to be made by and be binding upon each such person and
      such person’s heirs, executors, administrators, successors, legal
      representatives and permitted assigns.

     

    8.           
      Modification.  This
      Subscription Agreement will not be modified or waived except by an instrument
      in
      writing signed by the party against whom any such modification or waiver is
      sought.

     

    9.           
      Notices.  Any
      notice or other communication required or permitted to be given hereunder will
      be in writing and will be mailed by certified mail, return receipt requested,
      or
      delivered against receipt to the party to whom it is to be given (a) if to
      the
      Company, at the address set forth above or (b) if to the Subscriber, at the
      address set forth on the signature page hereof (or, in either case, to such
      other address as the party will have furnished in writing in accordance with
      the
      provisions of this Section
      9).  Any notice or other communication given by certified mail
      will be deemed given at the time of certification thereof, except for a notice
      changing a party’s address which will be deemed given at the time of receipt
      thereof.

     

    10.           
      Assignability.  This
      Subscription Agreement and the rights, interests and obligations hereunder
      are
      not transferable or assignable by the Subscriber and the transfer or assignment
      of the Units will be made only in accordance with all applicable laws and the
      applicable Offering documents.

     

    11.           
      Applicable
      Law.  This Subscription Agreement will be governed by and
      construed exclusively under the laws of the State of New York as applied to
      agreements among New York residents entered into and to be performed entirely
      within New York.  Each of the parties hereto (1) agree that any legal
      suit, action or proceeding arising out of or relating to this Subscription
      Agreement will be instituted exclusively in New York State Supreme Court, County
      of New York, or in the United States District Court for the Southern District
      of
      New York, (2) waive any objection which the Company may have now or hereafter
      to
      the venue of any such suit, action or proceeding, and (3) irrevocably consent
      to
      the jurisdiction of the New York State Supreme Court, County of New York, and
      the United States District Court for the Southern District of New York in any
      such suit, action or proceeding.  Each of the parties hereto further
      agrees to accept and acknowledge service of any and all process which may be
      served in any such suit, action or proceeding in the New York State Supreme
      Court, County of New York, or in the United States District Court for the
      Southern District of New York and agree that service of process upon it mailed
      by certified mail to its address will be deemed in every respect effective
      service of process upon it, in any such suit, action or
      proceeding.  THE PARTIES HERETO AGREE TO WAIVE THEIR RESPECTIVE RIGHTS
      TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF
      THIS SUBSCRIPTION AGREEMENT OR ANY DOCUMENT OR AGREEMENT CONTEMPLATED
      HEREBY.

     

    12.           
      Blue Sky
      Qualification.  The purchase of Shares under this Subscription
      Agreement is expressly conditioned upon the exemption from qualification of
      the
      offer and sale of the Units from applicable Federal and state securities
      laws.  The Company will not be required to qualify this transaction
      under the securities laws of any jurisdiction and, should qualification be
      necessary, the Company will be released from any and all obligations to maintain
      its offer, and may rescind any sale contracted, in the jurisdiction.

     

    
      
         

      

      
        -9-

        
          

        

      

      
         

      

    

    13.           
      Use of
      Pronouns.  All pronouns and any variations thereof used herein
      will be deemed to refer to the masculine, feminine, neuter, singular or plural
      as the identity of the person or persons referred to may require.

     

    

     

    14.           
      Miscellaneous.

     

    (aa)           
      This Subscription Agreement, constitutes the entire agreement between the
      Subscriber and the Company with respect to the subject matter hereof and
      supersede all prior oral or written agreements and understandings, if any,
      relating to the subject matter hereof. The terms and provisions of this
      Subscription Agreement may be waived, or consent for the departure therefrom
      granted, only by a written document executed by the party entitled to the
      benefits of such terms or provisions.

     

    (bb)           
      Each of the Subscriber’s representations and warranties made in this
      Subscription Agreement will survive the execution and delivery hereof and
      delivery of the Units for a period of twelve (12) months from the date of
      issuance.

     

    (cc)           
      Each of the parties hereto will pay its own fees and expenses (including the
      fees of any attorneys, accountants, appraisers or others engaged by such party)
      in connection with this Subscription Agreement and the transactions contemplated
      hereby whether or not the transactions contemplated hereby are
      consummated.

     

    (gg) This
      Subscription Agreement may be executed in one or more counterparts each of
      which
      will be deemed an original, but all of which will together constitute one and
      the same instrument.

     

    (hh) Each
      provision of this Subscription Agreement will be considered separable and,
      if
      for any reason any provision or provisions hereof are determined to be invalid
      or contrary to applicable law, such invalidity or illegality will not impair
      the
      operation of or affect the remaining portions of this Subscription
      Agreement.

     

    (ii) Paragraph
      titles are for descriptive purposes only and will not control or alter the
      meaning of this Subscription Agreement as set forth in the text.

     

    
      
         

      

      
        -10-

        
          

        

      

      
         

      

    

    

     

    PHOENIX
      INTERNATIONAL VENTURES, INC.

    OMNIBUS
      SIGNATURE PAGE TO

    SUBSCRIPTION
      AGREEMENT

    

    Subscriber
      hereby elects to purchase a total of ______ Units at a price of $1.40 per Unit
      (NOTE: to be completed by the Subscriber) and agrees to all of the terms and
      conditions of this Subscription Agreement referred to herein.

     

    Date
      (NOTE: To be completed by the
      Subscriber): __________________, 2007*

     

    If
      the Subscriber is an INDIVIDUAL, and
      if purchased as JOINT TENANTS, as TENANTS IN COMMON, or as COMMUNITY
      PROPERTY:

     

    
      	 	 	 
	
              Print
                Name(s)

              
              

            	 	
              Social
                Security Number(s)

              
              

            
	 	 	 
	
              Signature(s)
                of Subscriber(s)

              
              

            	 	
              Signature

              
              

            
	 	 	 
	
              Date

              
              

            	 	
              Date

              
              

            

    

    

    If
      the Subscriber is a PARTNERSHIP,
      CORPORATION, LIMITED LIABILITY COMPANY or TRUST:

     

    
      	 	 	 
	
              Name
                of Partnership,

              Corporation,
                Limited

              Liability
                Company or Trust

              
              

            	 	
              Federal
                Taxpayer

              Identification
                Number

              
              

            
	
              
              

              By: 
                

            	 	 	
              By:

            	 
	
               

              Name:

              Title:

              
              

            	 	
               

              Name:
                State of Organization

              
              

            
	 	 	 
	
              Date

              
              

            	 	
              Address

              
              

            

    

    

    PHOENIX
      INTERNATIONAL VENTURES,
      INC..

     

    By:           
_________________________________

     

                  Authorized
      Officer

     

    
      
         

      

      
        -11-

        
          

        

      

      
         

      

    

    
      ANNEX
        A

       

    

    CONFIDENTIAL
      PROSPECTIVE
      PURCHASER QUESTIONNAIRE

     

    THIS
      QUESTIONNAIRE IS TO BE COMPLETED BY EACH PERSON WHO DESIRES TO PURCHASE UNITS
      OF
      PHOENIX INTERNATIONAL VENTURES, INC.. (THE” COMPANY”).  THIS MATERIAL
      DOES NOT CONSTITUTE AN OFFER TO SELL NOR IS IT A SOLICITATION OF AN OFFER TO
      BUY
      ANY SECURITIES. THE TERMS OF THE OFFERING WILL BE MADE SOLELY PURSUANT TO THE
      TERMS AND CONDITIONS OF THE SECURITIES PURCHASE AGREEMENT PROVIDED HEREWITH
      WHICH CONTAINS MATERIAL INFORMATION TO BE REVIEWED IN CONNECTION WITH ANY
      INVESTMENT DECISION.

     

    ACCREDITED
      INVESTOR STATUS

     

    Please
      check whether one or more of the following definitions of "Accredited Investor,"
      if any, applies to you.  If none of the following applies to you,
      please leave a blank.  Please sign in the indicated space below and
      indicate the amount of your investment and put you initials after the
      amount.

     

    
      	
                       (a)

            	
              A
                Bank as defined in Section 3(a)(2) of the Securities Act of 1933,
                as
                amended (the "1933 Act"), or any savings and loan association or
                other
                institution as defined in Section 3(a)(5)(A) of the 1933 Act whether
                acting in its individual or fiduciary capacity; any broker or dealer
                registered pursuant to Section 15 of the Securities Exchange Act
                of 1934,
                as amended (the "Exchange Act"); an insurance company as defined
                in
                Section 2(13) of the 1933 Act; an investment company registered under
                the
                Investment Company Act of 1940 or a business development company
                as
                defined in Section 2(a)(48) of that act; a Small Business Investment
                Company licensed by the U.S. Small Business Administration under
                Section
                301(c) or (d) of the Small Business Investment Act of 1958; any plan
                established and maintained by a state, or its political subdivisions,
                or
                any agency or instrumentality of a state or its political subdivisions
                for
                the benefit of its employees, if such plan has total assets in excess
                of
                $5,000,000; any employee benefit plan within the meaning of the Employee
                Retirement Income Security Act of 1974, if the investment decision
                is made
                by a plan fiduciary, as defined in Section 3(21) of such act, which
                is
                either a bank, savings and loan association, insurance company, or
                registered investment advisor, or if the employee benefit plan has
                total
                assets in excess of $5,000,000 or, if a self-directed plan, with
                investment decisions made solely by persons that are Accredited Investors.
                

            

    

     

    
      	
                       (b)

            	
              A
                Private Business Development Company as defined in Section 202(a)(22)
                of
                the Investment Advisers Act of 1940.

            

    

     

    
      	
                     
                (c)

            	
              An
                organization described in Section 501(c)(3) of the Internal Revenue
                Code
                or corporation, Massachusetts or similar business trust, or partnership,
                not formed for the specific purpose of acquiring the securities offered,
                with total assets in excess of $5,000,000.

            

    

     

    
      	
                     
                (d)

            	
              A
                natural person whose individual net worth, or joint net worth with
                that
                person's spouse, at the time of purchase exceeds $1,000,000.
                

            

    

     

    
      	
                     
                (e)

            	
              A
                natural person who had an individual income in excess of $200,000
                in each
                of the two most recent years or joint income with that person's spouse
                in
                excess of $300,000 in each of those years and has a reasonable expectation
                of reaching the same income level in the current year.
                

            

    

     

    
      	
                     
                (f)

            	
              Any
                trust, with total assets in excess of $5,000,000, not formed for
                the
                specific purpose of acquiring the common stock, whose purchase is
                directed
                by a sophisticated person as described in Rule 506(b)(2)(ii) of Regulation
                D. 

            

    

     

    
      	
                     
                (g)

            	
              Any
                entity in which all of the equity owners are Accredited Investors.
                

            

    

     

    ________________                     $_______________________                       _______

    Investor’s
      Signature                          Amount
      of
      Investment                             Initials

    

    _____________________________

    (Please
      insert name in which Securities will be

    Held;
      if
      held by a corporation, please sign below)

    

    Corporate
      Purchaser

    

    By:
      _____________________

             Name/Title

    
      
         

      

      
        -12-

        
          

        

      

      
         

      

    

    ANNEX
      B

     

    RISK
      FACTORS

    

    An
      investment in our securities involves
      a high degree of risk. You should carefully consider the risks described below
      and the other information in the Company’s Registration Statement on Form SB-2
      declared effective by the SEC on August 30, 2007, as well as the Company’s
      quarterly report on Form 10QSB for the quarter ended September 30, 2007, both
      of
      which are available on the SEC’s website at http:pp www.sec.gov. before
      investing in our common stock. If any such risks occur, our business, operating
      results and financial condition could be seriously harmed. The trading price
      of
      our common stock could decline due to any of these risks, and you may lose
      part
      or all of your investment.

    

    Risks
      Related To Our Business

    

    The
      Company has a
      limited operating history.

    

    The
      Company is recently organized and
      the Company's principal operating subsidiary, founded in April, 2003, has only
      a
      limited operating history upon which an evaluation of the Company and its
      prospects can be based. The Company's prospects for financial success must
      be
      considered in light of the risks, expenses and difficulties frequently
      encountered by companies in highly competitive and evolving markets, such as
      the
      defense-aerospace industry market.

    

    

    We
      may fail to
      continue as a going concern, in which event you may lose your entire investment
      in our shares. 

    

    Our
      audited financial statements have
      been prepared on the assumption that we will continue as a going concern. Our
      independent registered public accountants have indicated that in their
      respective reports relative to PAI's and Phoenix International Ventures, Inc.'s
      (“PIV”) financial statements as of December 31, 2006 that (a) as discussed in
      Note 1 to its financial statements, PIV has a loss from operations, has no
      working capital and has no revenue generating activities and (b) as discussed
      in
      Note 2 to its financial statements, PAI has working capital and stockholder
      deficits. These factors raise substantial doubt about the Company's ability
      to
      continue as a going concern. The financial statements do not include any
      adjustments that might result from the outcome of this uncertainty.

    

    If
      we fail to continue in business, you
      will lose your investment in the shares you acquire in this offering.

    

    The
      Company may be
      unable to manage its growth or implement its business strategy.

    

    Although
      the Company has experienced
      significant growth in a relatively short period of time, it cannot assure you
      that the growth the Company has experienced will continue, nor can the Company
      assure you that it will be able to expand its facilities, its client base and
      markets or implement the other features of the Company's business strategy
      at
      the rate or to the extent presently planned. The Company's rapid growth to
      date
      has placed, and in the future will continue to place, a significant strain
      on
      its administrative, operational and financial resources.

     

    Our
      ability to generate revenue is
      dependent upon our success in obtaining awards for a very narrow category of
      contracts.

     

    Our
      ability to generate all of our
      revenues is dependent upon our success in obtaining awards for a very narrow
      category of aerospace and defense contracts. If we are not successful in
      receiving contracts from the U.S.government
      and/or U.S.defense
      industry contractors for any
      reason, including our failure to meet eligibility requirements, competition,
      our
      failure to perform under prior contracts, and/or changes in government and/or
      defense industry contracting policies, we would not generate sufficient revenue
      to continue in business.

    
      
         

      

      
        -13-

        
          

        

      

      
         

      

    

    The
      Offering price of the Units has been determined by our management.

     

    The
      Offering price of the Units was determined by our management and does not
      necessarily accurately reflect actual value of us and/or our assets, the Common
      Stock, our book value after the Offering, the market price of the Common Stock
      after the Offering or the price that may be realized upon disposition of the
      Common Stock.

     

    In
      the event that the Company fails to timely file any periodic report filings
      with
      the SEC, the Common Stock may be de-listed from the Over-The-Counter Bulletin
      Board.

     

    Pursuant
      to the Over-The-Counter Bulletin Board (“OTCBB”) rules relating to the timely
      filing of periodic reports with the SEC, any OTCBB issuer which fails to file
      a
      periodic report (Form-QSBs or 10-KSBs) by the due date of such report
      (notwithstanding any extension granted to the issuer by the filing of a Form
      12b-25), three (3) times during any twenty-four (24) month period is
      automatically de-listed from the OTC-BB.  In the event an issuer is
      de-listed, such issuer would not be eligible to be re-listed on the OTCBB for
      a
      period of one-year, during which time any subsequent late filing would reset
      the
      one year period of de-listing.  If the Company is late in its filings
      three times in any twenty-four (24) month period and is de-listed from the
      OTCBB, the Units may become worthless and investors may lose their entire
      investment.

     

    The
      Common Stock may be subject to penny stock rules, which could affect
      trading.

     

    Broker-dealer
      practices in connection with transactions in “penny stocks” are regulated by
      certain rules adopted by the SEC.  Penny stock generally are equity
      securities with a price of less than $5.00, subject to
      exceptions.  The rules require that a broker-dealer, prior to a
      transaction in a penny stock not otherwise exempt from the rules, deliver a
      standardized risk disclosure document that provides information about penny
      stocks and the risks in the penny stock market.  The broker-dealer
      also must provide the customer with current bid and offer quotations for the
      penny stock, the compensation of the broker-dealer and its salesperson in
      connection with the transaction and monthly account statements showing the
      market value of each penny stock held in the customer’ account.  In
      addition, the rules generally require that prior to a transaction in a penny
      stock, the broker-dealer must make a special written determination that the
      penny stock is a suitable investment for the purchaser and receive the
      purchaser’s written agreement to the transaction.  These disclosure
      requirements may have the effect of reducing the liquidity of penny
      stocks.  If the Company’s securities become subject to the penny stock
      rules, investors in the Offering may find it more difficult to sell their
      Units.

    
      
         

      

      
        -14-

        
          

        

      

      
         

      

    

    

     

    

     

    BANK
      TRANSFER DETAILS:

     

    Beneficiary:

    Phoenix
      International Ventures

    42
      Carry
      Way

    Unit
      1

    Mound
      House , NV 89706

    Banks
      Details:

    Bank
      of
      America

    600
      E.
      William St.

    Carson
      City, NV 89701

    USA

    Account
      Number:  005012641151

    ABA: 
      026009593

    SWIFT: 
      BOFAUS3N

     

      
        
           

        

        
          -15-

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