Document:

exh10_2.htm

    Exhibit
10.2

     

    ACKNOWLEDGMENT
OF AMENDMENT

    AND
REAFFIRMATION OF GUARANTY

     

    Section 1.    Guarantor hereby
acknowledges and confirms that it has reviewed and approved the terms and
conditions of the Fourth Amendment to Loan and Security Agreement dated as of
even date herewith between Silicon Valley Bank (“Bank”) and XPLORE TECHNOLOGIES
CORPORATION OF AMERICA, a Delaware corporation (“Borrower”) (the
“Amendment”).

     

    Section
2.            Guarantor
hereby consents to the Amendment and agrees that the Unconditional Guaranty
executed by Guarantor in favor of Bank dated April 22, 2005 relating to the
Obligations of Borrower under the Loan Agreement (the “Guaranty”) shall continue
in full force and effect, shall be valid and enforceable and shall not be
impaired or otherwise affected by the execution of the Amendment or any other
document or instrument delivered in connection herewith.

     

    Section
3.            Guarantor
represents and warrants that, after giving effect to the Amendment, all
representations and warranties contained in the Guaranty are true, accurate and
complete as if made the date hereof.

     

    Dated as
of March 28, 2008

     

    
      
        	
                GUARANTOR

              	
                XPLORE
      TECHNOLOGIES CORP.

                 

              
	 
      	
                By:           /s/ Michael J.
      Rapisand

                Name:      Michael J. Rapisand

                Title:        Chief Financial
      OfficerEX-10.52

 

    (Local Currency — Single Jurisdiction)

 

    
    ISDA ®

 

    International
    Swap Dealers Association, Inc.
    

 

    
    MASTER AGREEMENT

 

    dated as of
    February 27, 2008
    

 

    The Huntington National
    Bank          
    and          
    Franklin Credit Management Corporation

 

    have entered
    and/or
    anticipate entering into one or more transactions (each a
    “Transaction”) that are or will be governed by this
    Master Agreement, which includes the schedule (the
    “Schedule”), and the documents and other confirming
    evidence (each a “Confirmation”) exchanged between the
    parties confirming those Transactions.

 

    Accordingly,
    the parties agree as follows: —
    

 

		
	
    1.  
	
    Interpretation

 

    (a) Definitions.  The terms defined
    in Section 12 and in the Schedule will have the meanings
    therein specified for the purpose of this Master Agreement.

 

    (b) Inconsistency.  In the event of
    any inconsistency between the provisions of the Schedule and the
    other provisions of this Master Agreement, the Schedule will
    prevail. In the event of any inconsistency between the
    provisions of any Confirmation and this Master Agreement
    (including the Schedule), such Confirmation will prevail for the
    purpose of the relevant Transaction.

 

    (c) Single Agreement.  All
    Transactions are entered into in reliance on the fact that this
    Master Agreement and all Confirmations form a single agreement
    between the parties (collectively referred to as this
    “Agreement”), and the parties would not otherwise
    enter into any Transactions.

 

		
	
    2.  
	
    Obligations

 

    (a) General Conditions.

 

    (i) Each party will make each payment or delivery specified
    in each Confirmation to be made by it, subject to the other
    provisions of this Agreement.

 

    (ii) Payments under this Agreement will be made on the due
    date for value on that date in the place of the account
    specified in the relevant Confirmation or otherwise pursuant to
    this Agreement, in freely transferable funds and in the manner
    customary for payments in the required currency. Where
    settlement is by delivery (that is, other than by payment), such
    delivery will be made for receipt on the due date in the manner
    customary for the relevant obligation unless otherwise specified
    in the relevant Confirmation or elsewhere in this Agreement.

 

    (iii) Each obligation of each party under
    Section 2(a)(i) is subject to (1) the condition
    precedent that no Event of Default or Potential Event of Default
    with respect to the other party has occurred and is continuing,
    (2) the condition precedent that no Early Termination Date
    in respect of the relevant Transaction has occurred or been
    effectively designated and (3) each other applicable
    condition precedent specified in this Agreement.

 

    (b) Change of Account.  Either
    party may change its account for receiving a payment or delivery
    by giving notice to the other party at least five Local Business
    Days prior to the scheduled date for the payment or delivery to
    which such change applies unless such other party gives timely
    notice of a reasonable objection to such change.

    

    1

 

    (c) Netting.  If on any date
    amounts would otherwise be payable: —

 

    (i) in the same currency; and

 

    (ii) in respect of the same Transaction,

 

    by each party to the other, then, on such date, each
    party’s obligation to make payment of any such amount will
    be automatically satisfied and discharged and, if the aggregate
    amount that would otherwise have been payable by one party
    exceeds the aggregate amount that would otherwise have been
    payable by the other party, replaced by an obligation upon the
    party by whom the larger aggregate amount would have been
    payable to pay to the other party the excess of the larger
    aggregate amount over the smaller aggregate amount.

 

    The parties may elect in respect of two or more Transactions
    that a net amount will be determined in respect of all amounts
    payable on the same date in the same currency in respect of such
    Transactions, regardless of whether such amounts are payable in
    respect of the same Transaction. The election may be made in the
    Schedule or a Confirmation by specifying that subparagraph
    (ii) above will not apply to the Transactions identified as
    being subject to the election, together with the starting date
    (in which case subparagraph (ii) above will not, or will
    cease to, apply to such Transactions from such date). This
    election may be made separately for different groups of
    Transactions and will apply separately to each pairing of
    branches or offices through which the parties make and receive
    payments or deliveries.

 

    (d) Default Interest; Other
    Amounts.  Prior to the occurrence or effective
    designation of an Early Termination Date in respect of the
    relevant Transaction, a party that defaults in the performance
    of any payment obligation will, to the extent permitted by law
    and subject to Section 6(c), be required to pay interest
    (before as well as after judgment) on the overdue amount to the
    other party on demand in the same currency as such overdue
    amount, for the period from (and including) the original due
    date for payment to (but excluding) the date of actual payment,
    at the Default Rate. Such interest will be calculated on the
    basis of daily compounding and the actual number of days
    elapsed. If, prior to the occurrence or effective designation of
    an Early Termination Date in respect of the relevant
    Transaction, a party defaults in the performance of any
    obligation required to be settled by delivery, it will
    compensate the other party on demand if and to the extent
    provided for in the relevant Confirmation or elsewhere in this
    Agreement.

 

		
	
    3.  
	
    Representations

 

    Each party represents to the other party (which representations
    will be deemed to be repeated by each party on each date on
    which a Transaction is entered into) that: —

 

    (a) Basic Representations.

 

    (i) Status.  It is duly organised
    and validly existing under the laws of the jurisdiction of its
    organisation or incorporation and, if relevant under such laws,
    in good standing;

 

    (ii) Powers.  It has the power to
    execute this Agreement and any other documentation relating to
    this Agreement to which it is a party, to deliver this Agreement
    and any other documentation relating to this Agreement that it
    is required by this Agreement to deliver and to perform its
    obligations under this Agreement and any obligations it has
    under any Credit Support Document to which it is a party and has
    taken all necessary action to authorise such execution, delivery
    and performance;

 

    (iii) No Violation or
    Conflict.  Such execution, delivery and
    performance do not violate or conflict with any law applicable
    to it, any provision of its constitutional documents, any order
    or judgment of any court or other agency of government
    applicable to it or any of its assets or any contractual
    restriction binding on or affecting it or any of its assets;

 

    (iv) Consents.  All governmental
    and other consents that are required to have been obtained by it
    with respect to this Agreement or any Credit Support Document to
    which it is a party have been obtained and are in full force and
    effect and all conditions of any such consents have been
    complied with; and

 

    (v) Obligations Binding.  Its
    obligations under this Agreement and any Credit Support Document
    to which it is a party constitute its legal, valid and binding
    obligations, enforceable in accordance with

    

    2

 

    their respective terms (subject to applicable bankruptcy,
    reorganisation, insolvency, moratorium or similar laws affecting
    creditors’ rights generally and subject, as to
    enforceability, to equitable principles of general application
    (regardless of whether enforcement is sought in a proceeding in
    equity or at law)).

 

    (b) Absence of Certain Events.  No
    Event of Default or Potential Event of Default or, to its
    knowledge, Termination Event with respect to it has occurred and
    is continuing and no such event or circumstance would occur as a
    result of its entering into or performing its obligations under
    this Agreement or any Credit Support Document to which it is a
    party.

 

    (c) Absence of Litigation.  There
    is not pending or, to its knowledge, threatened against it or
    any of its Affiliates any action, suit or proceeding at law or
    in equity or before any court, tribunal, governmental body,
    agency or official or any arbitrator that is likely to affect
    the legality, validity or enforceability against it of this
    Agreement or any Credit Support Document to which it is a party
    or its ability to perform its obligations under this Agreement
    or such Credit Support Document.

 

    (d) Accuracy of Specified
    information.  All applicable information that
    is furnished in writing by or on behalf of it to the other party
    and is identified for the purpose of this Section 3(d) in
    the Schedule is, as of the date of the information, true,
    accurate and complete in every material respect.

 

		
	
    4.  
	
    Agreements

 

    Each party agrees with the other that, so long as either party
    has or may have any obligation under this Agreement or under any
    Credit Support Document to which it is a party: —

 

    (a) Furnish Specified
    Information.  It will deliver to the other
    party any forms, documents or certificates specified in the
    Schedule or any Confirmation by the date specified in the
    Schedule or such Confirmation or, if none is specified, as soon
    as reasonably practicable.

 

    (b) Maintain Authorisations.  It
    will use all reasonable efforts to maintain in full force and
    effect all consents of any governmental or other authority that
    are required to be obtained by it with respect to this Agreement
    or any Credit Support Document to which it is a party and will
    use all reasonable efforts to obtain any that may become
    necessary in the future.

 

    (c) Comply with Laws.  It will
    comply in all material respects with all applicable laws and
    orders to which it may be subject if failure so to comply would
    materially impair its ability to perform its obligations under
    this Agreement or any Credit Support Document to which it is a
    party.

 

		
	
    5.  
	
    Events of
    Default and Termination Events

 

    (a) Events of Default.  The
    occurrence at any time with respect to a party or, if
    applicable, any Credit Support Provider of such party or any
    Specified Entity of such party of any of the following events
    constitutes an event of default (an “Event of
    Default”) with respect to such party: —

 

    (i) Failure to Pay or
    Deliver.  Failure by the party to make, when
    due, any payment under this Agreement or delivery under
    Section 2(a)(i) or 2(d) required to be made by it if such
    failure is not remedied on or before the third Local Business
    Day after notice of such failure is given to the party;

 

    (ii) Breach of Agreement.  Failure
    by the party to comply with or perform any agreement or
    obligation (other than an obligation to make any payment under
    this Agreement or delivery under Section 2(a)(i) or 2(d) or
    to give notice of a Termination Event) to be complied with or
    performed by the party in accordance with this Agreement if such
    failure is not remedied on or before the thirtieth day after
    notice of such failure is given to the party;

 

    (iii) Credit Support Default.

 

    (1) Failure by the party or any Credit Support Provider of
    such party to comply with or perform any agreement or obligation
    to be complied with or performed by it in accordance with any
    Credit Support Document if such failure is continuing after any
    applicable grace period has elapsed;

    

    3

 

    (2) the expiration or termination of such Credit Support
    Document or the failing or ceasing of such Credit Support
    Document to be in full force and effect for the purpose of this
    Agreement (in either case other than in accordance with its
    terms) prior to the satisfaction of all obligations of such
    party under each Transaction to which such Credit Support
    Document relates without the written consent of the other
    party; or

 

    (3) the party or such Credit Support Provider disaffirms,
    disclaims, repudiates or rejects, in whole or in part, or
    challenges the validity of, such Credit Support Document;

 

    (iv) Misrepresentation.  A
    representation made or repeated or deemed to have been made or
    repeated by the party or any Credit Support Provider of such
    party in this Agreement or any Credit Support Document proves to
    have been incorrect or misleading in any material respect when
    made or repeated or deemed to have been made or repeated;

 

    (v) Default under Specified
    Transaction.  The party, any Credit Support
    Provider of such party or any applicable Specified Entity of
    such party (1) defaults under a Specified Transaction and,
    after giving effect to any applicable notice requirement or
    grace period, there occurs a liquidation of, an acceleration of
    obligations under, or an early termination of, that Specified
    Transaction, (2) defaults, after giving effect to any
    applicable notice requirement or grace period, in making any
    payment or delivery due on the last payment, delivery or
    exchange date of, or any payment on early termination of, a
    Specified Transaction (or such default continues for at least
    three Local Business Days if there is no applicable notice
    requirement or grace period) or (3) disaffirms, disclaims,
    repudiates or rejects, in whole or in part, a Specified
    Transaction (or such action is taken by any person or entity
    appointed or empowered to operate it or act on its behalf);

 

    (vi) Cross Default.  If “Cross
    Default” is specified in the Schedule as applying to the
    party, the occurrence or existence of (1) a default, event
    of default or other similar condition or event (however
    described) in respect of such party, any Credit Support Provider
    of such party or any applicable Specified Entity of such party
    under one or more agreements or instruments relating to
    Specified Indebtedness of any of them (individually or
    collectively) in an aggregate amount of not less than the
    applicable Threshold Amount (as specified in the Schedule) which
    has resulted in such Specified Indebtedness becoming, or
    becoming capable at such time of being declared, due and payable
    under such agreements or instruments, before it would otherwise
    have been due and payable or (2) a default by such party,
    such Credit Support Provider or such Specified Entity
    (individually or collectively) in making one or more payments on
    the due date thereof in an aggregate amount of not less than the
    applicable Threshold Amount under such agreements or instruments
    (after giving effect to any applicable notice requirement or
    grace period);

 

    (vii) Bankruptcy.  The party, any
    Credit Support Provider of such party or any applicable
    Specified Entity of such party: —

 

    (1) is dissolved (other than pursuant to a consolidation,
    amalgamation or merger); (2) becomes insolvent or is unable
    to pay its debts or fails or admits in writing its inability
    generally to pay its debts as they become due; (3) makes a
    general assignment, arrangement or composition with or for the
    benefit of its creditors; (4) institutes or has instituted
    against it a proceeding seeking a judgment of insolvency or
    bankruptcy or any other relief under any bankruptcy or
    insolvency law or other similar law affecting creditors’
    rights, or a petition is presented for its
    winding-up
    or liquidation, and, in the case of any such proceeding or
    petition instituted or presented against it, such proceeding or
    petition (A) results in a judgment of insolvency or
    bankruptcy or the entry of an order for relief or the making of
    an order for its
    winding-up
    or liquidation or (B) is not dismissed, discharged, stayed
    or restrained in each case within 30 days of the
    institution or presentation thereof; (5) has a resolution
    passed for its
    winding-up,
    official management or liquidation (other than pursuant to a
    consolidation, amalgamation or merger); (6) seeks or
    becomes subject to the appointment of an administrator,
    provisional liquidator, conservator, receiver, trustee,
    custodian or other similar official for it or for all or
    substantially all its assets; (7) has a secured party take
    possession of all or substantially all its assets or has a
    distress, execution, attachment, sequestration or other legal
    process

    

    4

 

    levied, enforced or sued on or against all or substantially all
    its assets and such secured party maintains possession, or any
    such process is not dismissed, discharged, stayed or restrained,
    in each case within 30 days thereafter; (8) causes or
    is subject to any event with respect to it which, under the
    applicable laws of any jurisdiction, has an analogous effect to
    any of the events specified in clauses (1) to (7)
    (inclusive); or (9) takes any action in furtherance of, or
    indicating its consent to, approval of, or acquiescence in, any
    of the foregoing acts; or

 

    (viii) Merger Without
    Assumption.  The party or any Credit Support
    Provider of such party consolidates or amalgamates with, or
    merges with or into, or transfers all or substantially all its
    assets to, another entity and, at the time of such
    consolidation, amalgamation, merger or transfer: —

 

    (1) the resulting, surviving or transferee entity fails to
    assume all the obligations of such party or such Credit Support
    Provider under this Agreement or any Credit Support Document to
    which it or its predecessor was a party by operation of law or
    pursuant to an agreement reasonably satisfactory to the other
    party to this Agreement; or

 

    (2) the benefits of any Credit Support Document fail to
    extend (without the consent of the other party) to the
    performance by such resulting, surviving or transferee entity of
    its obligations under this Agreement.

 

    (b) Termination Events.  The
    occurrence at any time with respect to a party or, if
    applicable, any Credit Support Provider of such party or any
    Specified Entity of such party of any event specified below
    constitutes an Illegality if the event is specified in
    (i) below, and, if specified to be applicable, a Credit
    Event Upon Merger if the event is specified pursuant to
    (ii) below or an Additional Termination Event if the event
    is specified pursuant to (iii) below: —

 

    (i) Illegality.  Due to the
    adoption of, or any change in, any applicable law after the date
    on which a Transaction is entered into, or due to the
    promulgation of, or any change in, the interpretation by any
    court, tribunal or regulatory authority with competent
    jurisdiction of any applicable law after such date, it becomes
    unlawful (other than as a result of a breach by the party of
    Section 4(b)) for such party (which will be the Affected
    Party): —

 

    (1) to perform any absolute or contingent obligation to
    make a payment or delivery or to receive a payment or delivery
    in respect of such Transaction or to comply with any other
    material provision of this Agreement relating to such
    Transaction; or

 

    (2) to perform, or for any Credit Support Provider of such
    party to perform, any contingent or other obligation which the
    party (or such Credit Support Provider) has under any Credit
    Support Document relating to such Transaction;

 

    (ii) Credit Event Upon Merger.  If
    “Credit Event Upon Merger” is specified in the
    Schedule as applying to the party, such party (“X”),
    any Credit Support Provider of X or any applicable Specified
    Entity of X consolidates or amalgamates with, or merges with or
    into, or transfers all or substantially all its assets to,
    another entity and such action does not constitute an event
    described in Section 5(a)(viii) but the creditworthiness of
    the resulting, surviving or transferee entity is materially
    weaker than that of X, such Credit Support Provider or such
    Specified Entity, as the case may be, immediately prior to such
    action (and, in such event, X or its successor or transferee, as
    appropriate, will be the Affected Party); or

 

    (iii) Additional Termination
    Event.  If any “Additional Termination
    Event” is specified in the Schedule or any Confirmation as
    applying, the occurrence of such event (and, in such event, the
    Affected Party or Affected Parties shall be as specified for
    such Additional Termination Event in the Schedule or such
    Confirmation).

 

    (c) Event of Default and
    Illegality.  If an event or circumstance which
    would otherwise constitute or give rise to an Event of Default
    also constitutes an Illegality, it will be treated as an
    Illegality and will not constitute an Event of Default.

    

    5

 

		
	
    6.  
	
    Early
    Termination

 

    (a) Right to Terminate Following Event of
    Default.  If at any time an Event of Default
    with respect to a party (the “Defaulting Party”) has
    occurred and is then continuing, the other party (the
    “Non-defaulting Party”) may, by not more than
    20 days notice to the Defaulting Party specifying the
    relevant Event of Default, designate a day not earlier than the
    day such notice is effective as an Early Termination Date in
    respect of all outstanding Transactions. If, however,
    “Automatic Early Termination” is specified in the
    Schedule as applying to a party, then an Early Termination Date
    in respect of all outstanding Transactions will occur
    immediately upon the occurrence with respect to such party of an
    Event of Default specified in Section 5(a)(vii)(1), (3),
    (5), (6) or, to the extent analogous thereto, (8), and as
    of the time immediately preceding the institution of the
    relevant proceeding or the presentation of the relevant petition
    upon the occurrence with respect to such party of an Event of
    Default specified in Section 5(a)(vii)(4) or, to the extent
    analogous thereto, (8).

 

    (b) Right to Terminate Following Termination
    Event.

 

    (i) Notice.  If a Termination Event
    occurs, an Affected Party will, promptly upon becoming aware of
    it, notify the other party, specifying the nature of that
    Termination Event and each Affected Transaction and will also
    give such other information about that Termination Event as the
    other party may reasonably require.

 

    (ii) Two Affected Parties.  If an
    Illegality under Section 5(b)(i)(1) occurs and there are
    two Affected Parties, each party will use all reasonable efforts
    to reach agreement within 30 days after notice thereof is
    given under Section 6(b)(i) on action to avoid that
    Termination Event.

 

    (iii) Right to
    Terminate.  If: —

 

    (1) an agreement under Section 6(b)(ii) has not been
    effected with respect to all Affected Transactions within
    30 days after an Affected Party gives notice under
    Section 6(b)(i); or

 

    (2) an Illegality other than that referred to in
    Section 6(b)(ii), a Credit Event Upon Merger or an
    Additional Termination Event occurs,

 

    either party in the case of an Illegality, any Affected Party in
    the case of an Additional Termination Event if there is more
    than one Affected Party, or the party which is not the Affected
    Party in the case of a Credit Event Upon Merger or an Additional
    Termination Event if there is only one Affected Party may, by
    not more than 20 days notice to the other party and
    provided that the relevant Termination Event is then continuing,
    designate a day not earlier than the day such notice is
    effective as an Early Termination Date in respect of all
    Affected Transactions.

 

    (c) Effect of Designation.

 

    (i) If notice designating an Early Termination Date is
    given under Section 6(a) or (b), the Early Termination Date will
    occur on the date so designated, whether or not the relevant
    Event of Default or Termination Event is then continuing.
    (ii) Upon the occurrence or effective designation of an
    Early Termination Date, no further payments or deliveries under
    Section 2(a)(i) or 2(d) in respect of the Terminated
    Transactions will be required to be made, but without prejudice
    to the other provisions of this Agreement. The amount, if any,
    payable in respect of an Early Termination Date shall be
    determined pursuant to Section 6(e).

 

    (d) Calculations.

 

    (i) Statement.  On or as soon as
    reasonably practicable following the occurrence of an Early
    Termination Date, each party will make the calculations on its
    part, if any, contemplated by Section 6(e) and will provide
    to the other party a statement (1) showing, in reasonable
    detail, such calculations (including all relevant quotations and
    specifying any amount payable under Section 6(e)) and
    (2) giving details of the relevant account to which any
    amount payable to it is to be paid. In the absence of written
    confirmation from the source of a quotation obtained in
    determining a Market Quotation, the records of the party
    obtaining such quotation will be conclusive evidence of the
    existence and accuracy of such quotation.

    

    6

 

    (ii) Payment Date.  An amount
    calculated as being due in respect of any Early Termination Date
    under Section 6(e) will be payable on the day that notice
    of the amount payable is effective (in the case of an Early
    Termination Date which is designated or occurs as a result of an
    Event of Default) and on the day which is two Local Business
    Days after the day on which notice of the amount payable is
    effective (in the case of an Early Termination Date which is
    designated as a result of a Termination Event). Such amount will
    be paid together with (to the extent permitted under applicable
    law) interest thereon (before as well as after judgment), from
    (and including) the relevant Early Termination Date to (but
    excluding) the date such amount is paid, at the Applicable Rate.
    Such interest will be calculated on the basis of daily
    compounding and the actual number of days elapsed.

 

    (e) Payments on Early
    Termination.  If an Early Termination Date
    occurs, the following provisions shall apply based on the
    parties’ election in the Schedule of a payment measure,
    either “Market Quotation” or “Loss”, and a
    payment method, either the “First Method” or the
    “Second Method”. If the parties fail to designate a
    payment measure or payment method in the Schedule, it will be
    deemed that “Market Quotation” or the “Second
    Method”, as the case may be, shall apply. The amount, if
    any, payable in respect of an Early Termination Date and
    determined pursuant to this Section will be subject to any
    Set-off.

 

    (i) Events of Default.  If the Early
    Termination Date results from an Event of Default: —

 

    (1) First Method and Market Quotation.  If
    the First Method and Market Quotation apply, the Defaulting
    Party will pay to the Non-defaulting Party the excess, if a
    positive number, of (A) the sum of the Settlement Amount
    (determined by the Non-defaulting Party) in respect of the
    Terminated Transactions and the Unpaid Amounts owing to the
    Non-defaulting Party over (B) the Unpaid Amounts owing to
    the Defaulting Party.

 

    (2) First Method and Loss.  If the First
    Method and Loss apply, the Defaulting Party will pay to the
    Non-defaulting Party, if a positive number, the Non-defaulting
    Party’s Loss in respect of this Agreement.

 

    (3) Second Method and Market
    Quotation.  If the Second Method and Market
    Quotation apply, an amount will be payable equal to (A) the
    sum of the Settlement Amount (determined by the Non-defaulting
    Party) in respect of the Terminated Transactions and the Unpaid
    Amounts owing to the Non-defaulting Party less (B) the
    Unpaid Amounts owing to the Defaulting Party. If that amount is
    a positive number, the Defaulting Party will pay it to the
    Non-defaulting Party; if it is a negative number, the
    Non-defaulting Party will pay the absolute value of that amount
    to the Defaulting Party.

 

    (4) Second Method and Loss.  If the Second
    Method and Loss apply, an amount will be payable equal to the
    Non-defaulting Party’s Loss in respect of this Agreement.
    If that amount is a positive number, the Defaulting Party will
    pay it to the Non-defaulting Party; if it is a negative number,
    the Non-defaulting Party will pay the absolute value of that
    amount to the Defaulting Party.

 

    (ii) Termination Events.  If the
    Early Termination Date results from a Termination
    Event: —

 

    (1) One Affected Party.  If there is one
    Affected Party, the amount payable will be determined in
    accordance with Section 6(e)(i)(3), if Market Quotation
    applies, or Section 6(e)(i)(4), if Loss applies, except
    that, in either case, references to the Defaulting Party and to
    the Non-defaulting Party will be deemed to be references to the
    Affected Party and the party which is not the Affected Party,
    respectively, and, if Loss applies and fewer than all the
    Transactions are being terminated, Loss shall be calculated in
    respect of all Terminated Transactions.

 

    (2) Two Affected Parties.  If there are
    two Affected Parties: —

 

    (A) if Market Quotation applies, each party will determine
    a Settlement Amount in respect of the Terminated Transactions,
    and an amount will be payable equal to (I) the sum of
    (a) one-half of the difference between the Settlement
    Amount of the party with the higher Settlement Amount
    (“X”) and the Settlement Amount of the party with the
    lower Settlement Amount (“Y”) and (b) the Unpaid
    Amounts owing to X less (II) the Unpaid Amounts owing to
    Y; and

    

    7

 

    (B) if Loss applies, each party will determine its Loss in
    respect of this Agreement (or, if fewer than all the
    Transactions are being terminated, in respect of all Terminated
    Transactions) and an amount will be payable equal to one-half of
    the difference between the Loss of the party with the higher
    Loss (“X”) and the Loss of the party with the lower
    Loss (“Y”).

 

    If the amount payable is a positive number, Y will pay it to X;
    if it is a negative number, X will pay the absolute value of
    that amount to Y.

 

    (iii) Adjustment for
    Bankruptcy.  In circumstances where an Early
    Termination Date occurs because “Automatic Early
    Termination” applies in respect of a party, the amount
    determined under this Section 6(e) will be subject to such
    adjustments as are appropriate and permitted by law to reflect
    any payments or deliveries made by one party to the other under
    this Agreement (and retained by such other party) during the
    period from the relevant Early Termination Date to the date for
    payment determined under Section 6(d)(ii).

 

    (iv) Pre-Estimate.  The parties
    agree that if Market Quotation applies an amount recoverable
    under this Section 6(e) is a reasonable pre-estimate of
    loss and not a penalty. Such amount is payable for the loss of
    bargain and the loss of protection against future risks and
    except as otherwise provided in this Agreement neither party
    will be entitled to recover any additional damages as a
    consequence of such losses.

 

		
	
    7.  
	
    Transfer

 

    Neither this Agreement nor any interest or obligation in or
    under this Agreement may be transferred (whether by way of
    security or otherwise) by either party without the prior written
    consent of the other party, except that: —

 

    (a) a party may make such a transfer of this Agreement
    pursuant to a consolidation amalgamation with, or merger with or
    into, or transfer of all or substantially all its assets to,
    another entity (but without prejudice to any other right or
    remedy under this Agreement); and

 

    (b) a party may make such a transfer of all or any part of
    its interest in any amount payable to it from a Defaulting Party
    under Section 6(e).

 

    Any
    purported transfer that is not in compliance with this Section
    will be void
    

 

		
	
    8.  
	
    Miscellaneous

 

    7(a) Entire Agreement.  This Agreement
    constitutes the entire agreement and understanding of the
    parties with respect to its subject matter and supersedes all
    oral communication and prior writings with respect thereto.

 

    (b) Amendments.  No amendment,
    modification or waiver in respect of this Agreement will be
    effective unless in writing (including a writing evidenced by a
    facsimile transmission) and executed by each of the parties or
    confirmed by an exchange of telexes or electronic messages on an
    electronic messaging system.

 

    (c) Survival of
    Obligations.  Without prejudice to
    Sections 2(a)(iii) and 6(c)(ii), the obligations of the
    parties under this Agreement will survive the termination of any
    Transaction.

 

    (d) Remedies Cumulative.  Except as
    provided in this Agreement, the rights, powers, remedies and
    privileges provided in this Agreement are cumulative and not
    exclusive of any rights, powers, remedies and privileges
    provided by law.

 

    (e) Counterparts and Confirmations.

 

    (i) This Agreement (and each amendment, modification and
    waiver in respect of it) may be executed and delivered in
    counterparts (including by facsimile transmission), each of
    which will be deemed an original.

    

    8

 

    (ii) The parties intend that they are legally bound by the
    terms of each Transaction from the moment they agree to those
    terms (whether orally or otherwise). A Confirmation shall be
    entered into as soon as practicable and may be executed and
    delivered in counterparts (including by facsimile transmission)
    or be created by an exchange of telexes or by an exchange of
    electronic messages on an electronic messaging system, which in
    each case will be sufficient for all purposes to evidence a
    binding supplement to this Agreement. The parties will specify
    therein or through another effective means that any such
    counterpart, telex or electronic message constitutes a
    Confirmation.

 

    (f) No Waiver of Rights.  A failure
    or delay in exercising any right, power or privilege in respect
    of this Agreement will not be presumed to operate as a waiver,
    and a single or partial exercise of any right, power or
    privilege will not be presumed to preclude any subsequent or
    further exercise, of that right, power or privilege or the
    exercise of any other right, power or privilege.

 

    (g) Headings.  The headings used in
    this Agreement are for convenience of reference only and are not
    to affect the construction of or to be taken into consideration
    in interpreting this Agreement.

 

    9. Expenses

 

    A Defaulting Party will, on demand, indemnify and hold harmless
    the other party for and against all reasonable out-of-pocket
    expenses, including legal fees, incurred by such other party by
    reason of the enforcement and protection of its rights under
    this Agreement or any Credit Support Document to which the
    Defaulting Party is a party or by reason of the early
    termination of any Transaction, including, but not limited to,
    costs of collection.

 

		
	
    10.  
	
    Notices

 

    (a) Effectiveness.  Any notice or
    other communication in respect of this Agreement may be given in
    any manner set forth below (except that a notice or other
    communication under Section 5 or 6 may not be given by
    facsimile transmission or electronic messaging system) to the
    address or number or in accordance with the electronic messaging
    system details provided (see the Schedule) and will be deemed
    effective as indicated: —

 

    (i) if in writing and delivered in person or by courier, on
    the date it is delivered;

 

    (ii) if sent by telex, on the date the recipient’s
    answerback is received;

 

    (iii) if sent by facsimile transmission, on the date that
    transmission is received by a responsible employee of the
    recipient in legible form (it being agreed that the burden of
    proving receipt will be on the sender and will not be met by a
    transmission report generated by the sender’s facsimile
    machine);

 

    (iv) if sent by certified or registered mail (airmail, if
    overseas) or the equivalent (return receipt requested), on the
    date that mail is delivered or its delivery is attempted; or

 

    (v) if sent by electronic messaging system, on the date
    that electronic message is received,

 

    unless the date of that delivery (or attempted delivery) or that
    receipt, as applicable, is not a Local Business Day or that
    communication is delivered (or attempted) or received, as
    applicable, after the close of business on a Local Business Day,
    in which case that communication shall be deemed given and
    effective on the first following day that is a local Business
    Day.

 

    (b) Change of Addresses.  Either
    party may by notice to the other change the address, telex or
    facsimile number or electronic messaging system details at which
    notices or other communications are to be given to it.

 

		
	
    11.  
	
    Governing
    Law and Jurisdiction

 

    (a) Governing Law.  This Agreement
    will be governed by and construed in accordance with the law
    specified in the Schedule.

 

    (b) Jurisdiction.  With respect to
    any suit, action or proceedings relating to this Agreement
    (“Proceedings”), each party irrevocably: —

    

    9

 

    (i) submits to the jurisdiction of the English courts, if
    this Agreement is expressed to be governed by English law, or to
    the non-exclusive jurisdiction of the courts of the State of New
    York and the United States District Court located in the Borough
    of Manhattan in New York City, if this Agreement is expressed to
    be governed by the laws of the State of New York; and

 

    (ii) waives any objection which it may have at any time to
    the laying of venue of any Proceedings brought in any such
    court, waives any claim that such Proceedings have been brought
    in an inconvenient forum and further waives the right to object,
    with respect to such Proceedings, that such court does not have
    any jurisdiction over such party.

 

    Nothing in this Agreement precludes either party from bringing
    Proceedings in any other jurisdiction (outside, if this
    Agreement is expressed to be governed by English law, the
    Contracting States, as defined in Section 1(3) of the Civil
    Jurisdiction and Judgments Act 1982 or any modification,
    extension or re-enactment thereof for the time being in force)
    nor will the bringing of Proceedings in any one or more
    jurisdictions preclude the bringing of Proceedings in any other
    jurisdiction.

 

    (c) Waiver of Immunities.  Each
    party irrevocably waives, to the fullest extent permitted by
    applicable law, with respect to itself and its revenues and
    assets (irrespective of their use or intended use), all immunity
    on the grounds of sovereignty or other similar grounds from
    (i) suit, (ii) jurisdiction of any court,
    (iii) relief by way of injunction, order for specific
    performance or for recovery of property, (iv) attachment of
    its assets (whether before or after judgment) and
    (v) execution or enforcement of any judgment to which it or
    its revenues or assets might otherwise be entitled in any
    Proceedings in the courts of any jurisdiction and irrevocably
    agrees, to the extent permitted by applicable law, that it will
    not claim any such immunity in any Proceedings.

 

		
	
    12.  
	
    Definitions

 

    As used in
    this Agreement: —
    

 

    “Additional Termination Event” has the
    meaning specified in Section 5(b).

 

    “Affected Party” has the meaning
    specified in Section 5(b).

 

    “Affected Transactions” means
    (a) with respect to any Termination Event consisting of an
    Illegality, all Transactions affected by the occurrence of such
    Termination Event and (b) with respect to any other
    Termination Event, all Transactions.

 

    “Affiliate” means, subject to the
    Schedule, in relation to any person, any entity controlled,
    directly or indirectly, by the person, any entity that controls,
    directly or indirectly, the person or any entity directly or
    indirectly under common control with the person. For this
    purpose, “control” of any entity or person means
    ownership of a majority of the voting power of the entity or
    person.

 

    “Applicable Rate” means: —

 

    (a) in respect of obligations payable or deliverable (or
    which would have been but for Section 2(a)(iii)) by a
    Defaulting Party, the Default Rate;

 

    (b) in respect of an obligation to pay an amount under
    Section 6(e) of either party from and after the date
    (determined in accordance with Section 6(d)(ii)) on which that
    amount is payable, the Default Rate;

 

    (c) in respect of all other obligations payable or
    deliverable (or which would have been but for
    Section 2(a)(iii)) by a Non-defaulting Party, the
    Non-default Rate; and

 

    (d) in all other cases, the Termination Rate.

 

    “consent” includes a consent, approval,
    action, authorisation, exemption, notice, filing, registration
    or exchange control consent.

 

    “Credit Event Upon Merger” has the
    meaning specified in Section 5(b).

    

    10

 

    “Credit Support Document” means any
    agreement or instrument that is specified as such in this
    agreement.

 

    “Credit Support Provider” has the
    meaning specified in the Schedule.

 

    “Default Rate” means a rate per annum
    equal to the cost (without proof or evidence of any actual cost)
    to the relevant payee (as certified by it) if it were to fund or
    of funding the relevant amount plus 1% per annum.

 

    “Defaulting Party” has the meaning
    specified in Section 6(a).

 

    “Early Termination Date” means the date
    determined in accordance with Section 6(a) or 6(b)(iii).

 

    “Event of Default” has the meaning
    specified in Section 5(a) and, if applicable, in the
    Schedule.

 

    “Illegality” has the meaning specified
    in Section 5(b).

 

    “law” includes any treaty, law, rule or
    regulation and “lawful” and
    “unlawful” will be construed accordingly.

 

    “Local Business Day” means, subject to
    the Schedule, a day on which commercial banks are open for
    business (including dealings in foreign exchange and foreign
    currency deposits) (a) in relation to any obligation under
    Section 2(a)(i), in the place(s) specified in the relevant
    Confirmation or, if not so specified, as otherwise agreed by the
    parties in writing or determined pursuant to provisions
    contained, or incorporated by reference, in this Agreement,
    (b) in relation to any other payment, in the place where
    the relevant account is located, (c) in relation to any
    notice or other communication, including notice contemplated
    under Section 5(a)(i), in the city specified in the address
    for notice provided by the recipient and, in the case of a
    notice contemplated by Section 2(b), in the place where the
    relevant new account is to be located and (d) in relation
    to Section 5(a)(v)(2), in the relevant locations for
    performance with respect to such Specified Transaction.

 

    “Loss” means, with respect to this
    Agreement or one or more Terminated Transactions, as the case
    may be, and a party, an amount that party reasonably determines
    in good faith to be its total losses and costs (or gain, in
    which case expressed as a negative number) in connection with
    this Agreement or that Terminated Transaction or group of
    Terminated Transactions, as the case may be, including any loss
    of bargain, cost of funding or, at the election of such party
    but without duplication, loss or cost incurred as a result of
    its terminating, liquidating, obtaining or reestablishing any
    hedge or related trading position ( or any gain resulting from
    any of them). Loss includes losses and costs (or gains) in
    respect of any payment or delivery required to have been made
    (assuming satisfaction of each applicable condition precedent)
    on or before the relevant Early Termination Date and not made,
    except, so as to avoid duplication, if Section 6(e)(i)(1)
    or (3) or 6(e)(ii)(2)(A) applies. Loss does not include a
    party’s legal fees and out-of-pocket expenses referred to
    under Section 9. A party will determine its Loss as of the
    relevant Early Termination Date, or, if that is not reasonably
    practicable, as of the earliest date thereafter as is reasonably
    practicable. A party may (but need not) determine its Loss by
    reference to quotations of relevant rates or prices from one or
    more leading dealers in the relevant markets.

 

    “Market Quotation” means, with respect
    to one or more Terminated Transactions and a party making the
    determination, an amount determined on the basis of quotations
    from Reference Market-makers. Each quotation will be for an
    amount, if any, that would be paid to such party (expressed as a
    negative number) or by such party (expressed as a positive
    number) in consideration of an agreement between such party
    (taking into account any existing Credit Support Document with
    respect to the obligations of such party) and the quoting
    Reference Market-maker to enter into a transaction (the
    “Replacement Transaction”) that would have the effect
    of preserving for such party the economic equivalent of any
    payment or delivery (whether the underlying obligation was
    absolute or contingent and assuming the satisfaction of each
    applicable condition precedent) by the parties under
    Section 2(a)(i) in respect of such Terminated Transaction
    or group of Terminated Transactions that would, but for the
    occurrence of the relevant Early Termination Date, have been
    required after that date. For this purpose, Unpaid Amounts in
    respect of the Terminated Transaction or group of Terminated
    Transactions are to be excluded but, without limitation, any
    payment or delivery that would, but

    

    11

 

    for the relevant Early Termination Date, have been required
    (assuming satisfaction of each applicable condition precedent)
    after that Early Termination Date is to be included. The
    Replacement Transaction would be subject to such documentation
    as such party and the Reference Market-maker may, in good faith,
    agree. The party making the determination (or its agent) will
    request each Reference Market-maker to provide its quotation to
    the extent reasonably practicable as of the same day and time
    (without regard to different time zones) on or as soon as
    reasonably practicable after the relevant Early Termination
    Date. The day and time as of which those quotations are to be
    obtained will be selected in good faith by the party obliged to
    make a determination under Section 6(e), and, if each party
    is so obliged, after consultation with the other. If more than
    three quotations are provided, the Market Quotation will be the
    arithmetic mean of the quotations, without regard to the
    quotations having the highest and lowest values. If exactly
    three such quotations are provided, the Market Quotation will be
    the quotation remaining after disregarding the highest and
    lowest quotations. For this purpose, if more than one quotation
    has the same highest value or lowest value, then one of such
    quotations shall be disregarded. If fewer than three quotations
    are provided, it will be deemed that the Market Quotation in
    respect of such Terminated Transaction or group of Terminated
    Transactions cannot be determined.

 

    “Non-default Rate” means a rate per
    annum equal to the cost (without proof or evidence of any actual
    cost) to the Non-defaulting Party (as certified by it) if it
    were to fund the relevant amount.

 

    “Non-defaulting Party” has the meaning
    specified in Section 6(a).

 

    “Potential Event of Default” means any
    event which, with the giving of notice or the lapse of time or
    both, would constitute an Event of Default.

 

    “Reference Market-makers” means four
    leading dealers in the relevant market selected by the party
    determining a Market Quotation in good faith (a) from among
    dealers of the highest credit standing which satisfy all the
    criteria that such party applies generally at the time in
    deciding whether to offer or to make an extension of credit and
    (b) to the extent practicable, from among such dealers
    having an office in the sane city.

 

    “Scheduled Payment Date” means a date on
    which a payment or delivery is to be made under
    Section 2(a)(i) with respect to a Transaction.

 

    “Set-off” means set-off, offset,
    combination of accounts, right of retention or withholding or
    similar right or requirement to which the payer of an amount
    under Section 6 is entitled or subject (whether arising
    under this Agreement, another contract, applicable law or
    otherwise) that is exercised by, or imposed on, such payer.

 

    “Settlement Amount” means, with respect
    to a party and any Early Termination Date, the sum
    of: —

 

    (a) the Market Quotations (whether positive or negative)
    for each Terminated Transaction or group of Terminated
    Transactions for which a Market Quotation is determined; and

 

    (b) such party’s Loss (whether positive or negative
    and without reference to any Unpaid Amounts) for each Terminated
    Transaction or group of Terminated Transactions for which a
    Market Quotation cannot be determined or would not (in the
    reasonable belief of the party making the determination) produce
    a commercially reasonable result.

 

    “Specified Entity” has the meaning
    specified in the Schedule.

 

    “Specified Indebtedness” means, subject
    to the Schedule, any obligation (whether present or future,
    contingent or otherwise, as principal or surety or otherwise) in
    respect of borrowed money.

 

    “Specified Transaction” means, subject
    to the Schedule, (a) any transaction (including an
    agreement with respect thereto) now existing or hereafter
    entered into between one party to this Agreement (or any Credit
    Support Provider of such party or any applicable Specified
    Entity of such party) and the other party to this Agreement (or
    any Credit Support Provider of such other party or any
    applicable Specified Entity of such other party) which is a rate
    swap transaction, basis swap, forward rate transaction,
    commodity swap, commodity option, equity or equity index swap,
    equity or equity index option, bond option, interest rate
    option, foreign exchange transaction, cap transaction, floor
    transaction, collar transaction, currency swap transaction,
    cross-currency rate swap transaction, currency option or any
    other similar transaction (including

    

    12

 

    any option with respect to any of these transactions),
    (b) any combination of these transactions and (c) any
    other transaction identified as a Specified Transaction in this
    Agreement or the relevant confirmation.

 

    “Terminated Transactions” means with
    respect to any Early Termination Date (a) if resulting from
    a Termination Event, all Affected Transactions and (b) if
    resulting from an Event of Default, all Transactions (in either
    case) in effect immediately before the effectiveness of the
    notice designating that Early Termination Date (or, if
    “Automatic Early Termination” applies, immediately
    before that Early Termination Date).

 

    “Termination Event” means an Illegality
    or, if specified to be applicable, a Credit Event Upon Merger or
    an Additional Termination Event.

 

    “Termination Rate” means a rate per
    annum equal to the arithmetic mean of the cost (without proof or
    evidence of any actual cost) to each party (as certified by such
    party) if it were to fund or of funding such amounts.

 

    “Unpaid Amounts” owing to any party
    means, with respect to an Early Termination Date, the aggregate
    of (a) in respect of all Terminated Transactions, the
    amounts that became payable (or that would have become payable
    but for Section 2(a)(iii)) to such party under
    Section 2(a)(i) on or prior to such Early Termination Date
    and which remain unpaid as at such Early Termination Date and
    (b) in respect of each Terminated Transaction, for each
    obligation under Section 2(a)(i) which was (or would have
    been but for Section 2(a)(iii)) required to be settled by
    delivery to such party on or prior to such Early Termination
    Date and which has not been so settled as at such Early
    Termination Date, an amount equal to the fair market value of
    that which was (or would have been) required to be delivered as
    of the originally scheduled date for delivery, in each case
    together with (to the extent permitted under applicable law)
    interest, in the currency of such amounts, from (and including)
    the date such amounts or obligations were or would have been
    required to have been paid or performed to (but excluding) such
    Early Termination Date, at the Applicable Rate. Such amounts of
    interest will be calculated on the basis of daily compounding
    and the actual number of days elapsed. The fair market value of
    any obligation referred to in clause (b) above shall be
    reasonably determined by the party obliged to make the
    determination under Section 6(e) or, if each party is so
    obliged, it shall be the average of the fair market values
    reasonably determined by both parties.

 

    IN WITNESS WHEREOF the parties have executed this document on
    the respective dates specified below with effect from the date
    specified on the first page of this document.

 

	 	 	 
	

    The Huntington National Bank

	
 
	
    Franklin Credit Management Corporation

	

         (Name of Party)

	
 
	
                   (Name
    of Party)

	
 
	
 
	
 

	

    By: /s/  Scott
    Kleinman

    

	
 
	
    By: /s/  Alexander
    Gordon Jardin

    

	

    Name: Scott Kleinman

	
 
	
    Name: Alexander Gordon Jardin

	

    Title:  Senior Vice President

	
 
	
    Title:  Chief Executive Officer

	

    Date:  March 7, 2008

	
 
	
 

    

    13

 

    

 

    SCHEDULE TO
    THE 1992 ISDA MASTER AGREEMENT

 

    dated as
    of February 27, 2008

 

    between
    THE HUNTINGTON NATIONAL BANK, a national banking association

    (“Party A”),

 

    &

 

    Franklin
    Credit Management Corporation, a Delaware corporation

    (“Party B”).

 

    Part 1:
    Termination Provisions

 

    (a) “Specified Entity” means in relation
    to Party A for all purposes, None; and in relation to Party B
    for all purposes, all Affiliates of Party B.

 

    (b) “Specified Transaction” will have the
    meaning specified in Section 12 of this Agreement.

 

    (c) The “Cross Default” provisions of
    Section 5(a)(vi) of this Agreement will apply to Party B,
    except that the Acknowledged Defaults (as that term is defined
    in that certain Forbearance Agreement and Amendment to Credit
    Agreements (as it may have been or may in the future be amended
    or modified from time to time, the “Franklin Forbearance
    Agreement”) dated as of December 28, 2007, between
    Party A, Party B and the other parties listed in said
    document as parties thereto) and the Acknowledged Defaults (as
    that term is defined in that certain Tribeca Forbearance
    Agreement and Amendment to Credit Agreements (as it may have
    been of may in the future be amended or modified from time to
    time, the “Tribeca Forbearance Agreement”) dated as of
    December 28, 2007, between Party A, Party B, Tribeca
    Lending Corporation and the other parties listed in said
    document as parties thereto) are not Events of Default under
    this Agreement.

 

    (d) “Specified Indebtedness” will have the
    meaning specified in Section 12 of this Agreement.

 

    (e) “Threshold Amount” means $1,000,000.00.

 

    (f) The “Credit Event Upon Merger”
    provisions of Section 5(b)(ii) of this Agreement will
    apply to Party B.

 

    (g) The “Automatic Early Termination”
    provisions of Section 6(a) of this Agreement will not
    apply to Party A and will not apply to Party B.

    

    1

 

    (h) Payments on Early Termination.  For
    the purpose of Section 6(e) of this Agreement the Second
    Method and Market Quotation provisions will apply.

 

    (i) Additional Termination Events.  For
    the purpose of Section 5(b)(iii) of the Agreement, it shall
    be an “Additional Termination Event” with Party B
    being the Affected Party if (a) any Credit Support Document
    expires, terminates, or fails to be in full force and effect, or
    if any attempt is made to cancel, limit or release any Credit
    Support Document, prior to the satisfaction of all obligations
    of Party B under each Transaction, or (b) there is a
    termination or cancellation of Party B’s credit
    relationship with Party A such that Party A no longer provides a
    loan, extension of credit or credit commitment to Party B unless
    Party B has arranged for a transfer (without regard to the
    limitations on such transfer set forth in Section 7(a) of
    this Agreement) of any and all rights and obligations of Party A
    under this Agreement and all Transactions to a third party, such
    transfer to be (i) evidenced by an agreement between Party
    A which shall terminate all of Party A’s obligations
    hereunder, Party B and such third party that is on such terms
    and in form and substance acceptable to Party A, and
    (ii) effective contemporaneously with such termination or
    cancellation.

 

    Part 2:
    Agreement to Deliver Documents

 

    For the purpose of Section 4(a) of this Agreement, Party B
    agrees to deliver the following documents:

 

    (a) On or before the execution of this Agreement and
    thereafter upon Party A’s request, a certificate of an
    authorized officer or other person of Party B in form and
    substance satisfactory to Party A and evidencing the necessary
    corporate authorizations, resolutions, and approvals with
    respect to the execution, delivery and performance of this
    Agreement, and certifying the names, true signatures, and
    authority of the officer(s) signing this Agreement and executing
    Transactions hereunder.

 

    (b) When requested by Party A, quarterly reports on
    Form 10-Q
    and reports on
    Form 10-K.

 

    Part 3:
    Miscellaneous

 

    (a) Addresses for Notices.  For the
    purpose of Section 10(a) of this Agreement:

 

    Address for notices or communications to Party A:

 

    Address: 41 South High Street, Columbus, Ohio 43287

    Attention: Rate Risk Management Unit, HC0931

    Facsimile No.: (614)
    480-4595  Telephone
    Number:
    (614) 480-5464

 

    Address for notices or communications to Party B:

 

    Address: 101 Hudson Street, 25th Floor, Jersey City, NJ
    07302

    Attention: Kim Shaw

    Facsimile No.:
                          Telephone:
    (201)
    604-4414

 

    (b) Calculation Agent.  The Calculation
    Agent is Party A

 

    (c) Credit Support Document:  Each of
    (a) the Loan Documents(as that term is defined in the
    Franklin Forbearance Agreement) that is a security agreement, a
    pledge agreement, a collateral agreement, a financing statement,
    a control agreement, a mortgage, a deed of trust or otherwise
    grants a security interest in or lien on or is related to the
    Collateral (as that term is defined in the Franklin Forbearance
    Agreement), and (b) the Loan Documents (as that term is
    defined in the Tribeca Forbearance Agreement) that is a security
    agreement, a pledge agreement, a collateral agreement, a
    financing statement, a control agreement, a mortgage, a deed of
    trust or otherwise grants a security interest in or lien on or
    is related to the Collateral (as that term is defined in the
    Tribeca Forbearance Agreement).

 

    (d) Credit Support Provider(s):  Each of
    (a) the Borrowers (as that term is defined in the Franklin
    Forbearance Agreement) that is a party to a Credit Support
    Document, and (b) the Borrowers (as that term is defined in
    the Tribeca Forbearance Agreement) that is a party to a Credit
    Support Document.

    

    2

 

    (e) Governing Law; Venue.  This Agreement
    will be governed by and construed in accordance with the law of
    the State of New York without reference to choice of law
    doctrine. The parties agree that all actions or proceedings
    arising in connection with this Agreement, any documents
    incorporated herein or executed in connection herewith, shall be
    tried and litigated only in the Federal District Courts for the
    Southern District of Ohio or the state courts of Franklin
    County, Ohio. The parties waive any right to assert the doctrine
    of forum non conveniens or to object to venue to the
    extent any proceeding is brought in accordance with this Section.

 

    (f) Absence of
    Litigation.  Section 3(c) of the Agreement is
    hereby amended to exclude Affiliates in the case of Party A.

 

    (g) Section 7 of the Agreement is hereby deleted in
    its entirety and replaced by the following:

 

    7. Transfer

 

    Neither this Agreement nor any interest or obligation in or
    under this Agreement may be transferred (whether by way of
    security or otherwise) by either party without the prior written
    consent of the other party, except that:

 

    (a) Party A may make such a transfer of this Agreement
    and/or any
    Transaction hereunder if such a transfer is to third party with
    an unsecured unsubordinated debt rating in one of the four
    highest generic rating categories (without considering
    subcategories or gradations indicating relative standing) by
    either Standard & Poor’s Corporation or
    Moody’s Investors Services, Inc., and if Party A
    notifies Party B of such a transfer promptly after it becomes
    effective; and

 

    (b) a party may make such a transfer of all or any part of
    its interest in any amount payable to it from a Defaulting Party
    under Section 6(e).

 

    Any purported transfer that is not in compliance with this
    Section will be void.

 

    (h) Default Interest; Other Amounts.  For
    the purpose of Section 2(d) of this Agreement the phrase
    “plus 1% per annum” in the definition of “Default
    Rate” in Section 12 of this Agreement shall be deleted
    and the phrase “plus 3% per annum” shall be
    substituted therefore.

 

    (i) Process Agent.  For the purpose of
    this Agreement, Party B consents to service of process or legal
    summons in connection with any action or proceeding relating in
    any way to this Agreement by U.S. Mail, either certified or
    registered, addressed to Party B as provided for in Part 3,
    Section (a) of this Schedule.

 

    (j) Payments.

 

    Party A will make payments to Party B by transfer of immediately
    available funds to the account of Party B at The Huntington
    National Bank in Columbus (Account
    Number:          )

 

    Party B will make payments to Party A by having immediately
    available funds in the account of Party B at The Huntington
    National Bank in Columbus (Account
    Number:          ),
    and Party A is irrevocably authorized to debit such account for
    each payment (it being understood that Party B will at all times
    maintain sufficient available balances in such account for such
    purposes).

 

    (k) Absence of Certain
    Events.  Section 3(b) of the Agreement is
    amended by deleting the word “No” and by inserting in
    its place the phrase “Except for the Acknowledged Defaults
    (as that term is defined in the Franklin Forbearance Agreement)
    and the Acknowledged Defaults (as that term is defined in the
    Tribeca Forbearance Agreement), no”.

 

    (l) No Waiver, etc.  Nothing in this
    Agreement or in any of the agreements, schedules or
    confirmations executed in connection with this Agreement shall
    waive, amend, modify, limit, impair or extend the maturity of
    any warranty, term, covenant or condition of the Franklin
    Forbearance Agreement, the Tribeca Forbearance Agreement or any
    Loan Document (as such term is defined in each such forbearance
    agreement, but excluding from such definition this Agreement or
    any Interest Rate Hedging Agreement executed in connection with
    this Agreement), and nothing herein shall affect, modify, limit
    or impair any of the rights and powers which Party A may
    have under any of the Franklin Forbearance Agreement, the
    Tribeca Forbearance Agreement or any Loan Document (as such term
    is defined in each such forbearance agreement), including
    without

    

    3

 

    limitation, the right to demand full payment of all Advances (as
    such term is defined in each such forbearance agreement) on the
    Forbearance Date (as such term is defined in each such
    forbearance agreement).

 

    Part 4.
    Other Provisions.

 

    (a) Event of Default.  Each party agrees
    to notify the other party of the occurrence of any Event of
    Default or Potential Event of Default as soon as it reasonably
    becomes aware of the occurrence thereof.

 

    (b) Pari Passu Nature of Obligations.  The
    obligations of Party B hereunder shall at all times rank either
    pari-passu with or senior to all other obligations of Party B;
    and Party A shall be the beneficiary of the collateral herein
    defined under the Credit Support Document(s).

 

    (c) Additional Representation.  Party B
    represents to Party A (which representation is deemed to be
    repeated by Party B on each date on which a Transaction is
    entered into) that:

 

    i) it is entering into the Transaction in connection with
    the conduct of its business or to manage the risk of an asset
    owned or a debt incurred, or reasonably likely to be owned or
    incurred in the conduct of its business;

 

    ii) it qualifies as an “eligible contract
    participant” under the Commodity Exchange Act; and this
    Agreement is a “swap agreement” as defined in
    Section 101(53B) of the Bankruptcy Code,
    11 U.S.C. §101(53B);

 

    iii) It is not relying (for purposes of making any
    investment decision or otherwise) upon any advice or counsel
    (whether written or oral) or upon any representation (whether
    written or oral) not explicitly contained in writing in this
    Agreement of Party A, regardless of whether Party A provides
    Party B with market information or its views;

 

    iv) It has consulted and will continue to consult with its
    own legal, regulatory, tax, business, investment, financial and
    accounting advisors to the extent it has deemed necessary, and
    has made and will continue to make its own investing, hedging
    and trading decisions (including without limitation decisions
    regarding the appropriateness
    and/or
    suitability of any Transaction pursuant to this Agreement) based
    upon its own judgment and upon any advice from such advisors as
    it has deemed necessary and not upon any view expressed by Party
    A;

 

    v) It has a full understanding of all the terms, conditions
    and risks (economic and otherwise) of this Agreement, each
    Credit Support Document and each Transaction, and is capable of
    assuming and willing to assume (financially and otherwise) such
    risks;

 

    vi) It is entering into this Agreement, each Credit Support
    Document and each Transaction for the purposes of managing its
    borrowings or investments, hedging its underlying assets or
    liabilities or in connection with a line of business, and not
    for purposes of speculation; and

 

    vii) It is entering into this Agreement and will enter into
    all Transactions as principal and in connection with its
    business or the management of its business, and not as agent or
    in any other capacity, fiduciary or otherwise.

 

    (d) Exchange of Confirmations.  Anything
    in this Agreement to the contrary notwithstanding, for each
    Transaction entered into hereunder, Party A shall promptly send
    to Party B a Confirmation, via telex or facsimile transmission,
    in such form as the parties may from time to time agree. The
    parties agree that any such exchange of telexes or facsimile
    transmissions shall constitute a Confirmation for all purposes
    hereunder.

 

    (e) Right of Set-Off.  If an Early
    Termination Date occurs as the result of (i) an Event of
    Default or (ii) a Termination Event, with respect to which
    there is only one Affected Party, the Non-Defaulting or
    Non-Affected Party may set-off (x) against any amount due
    and payable by it under Section 6(e) of this
    Agreement, any Other Obligations of the Defaulting Party or
    Affected Party or any Affiliate of the Defaulting Party or
    Affected Party; and (y) against any of its Other
    Obligations, any amount due and payable by it under
    Section 6(e) of this Agreement. A Party may exercise such
    set-off rights without prior notice to the other Party, but
    shall notify the other Party promptly after any exercise of such
    rights. If the amount of any Other

    

    4

 

    Obligations set-off is unascertained, the Non-Defaulting or
    Non-Affected Party may in good faith estimate such amount and
    set-off based on such estimate, subject to an accounting to the
    other Party when such an amount is ascertained, and to
    appropriate adjustment. The set-off rights of each Party
    hereunder shall be in addition to, and not in lieu of, such
    other remedies, including such other set-off rights, as such
    Party may have under this Agreement, by contract, by operation
    of law, in equity or otherwise. As used in this paragraph (e),
    the term “Other Obligations” means, with respect to
    either Party, any amount payable by it or any of its Affiliates
    to the other Party or any Affiliate of the other Party, whether
    such amount is payable under this Agreement, another contract,
    applicable law, in equity or otherwise.

 

    Disclaimer:  In entering into this Agreement,
    Party B understands that there is no assurance as to the
    direction in which interest rates in financial markets may move
    in the future, and that Party A makes no covenant,
    representation, or warranty in this regard or in regard to the
    suitability of the terms of the Agreement or any Transaction to
    the particular needs and financial situation of Party B. Party B
    represents that it has had the opportunity, independently of
    Party A and Party A’s affiliates, officers, employees, and
    agents to consult its own financial advisors and has determined
    that it is in Party B’s interest to enter into the
    Agreement and any Transaction.

 

    JURY WAIVER:  THE PARTIES ACKNOWLEDGE THAT, AS
    TO ANY AND ALL DISPUTES THAT MAY ARISE BETWEEN THE PARTIES, THE
    COMMERCIAL NATURE OF THE TRANSACTION(S) OUT OF WHICH THIS
    AGREEMENT ARISES MAKES ANY SUCH DISPUTE UNSUITABLE FOR TRIAL BY
    JURY. ACCORDINGLY, EACH PARTY HEREBY WAIVES ANY RIGHT TO TRIAL
    BY JURY AS TO ANY AND ALL DISPUTES THAT MAY ARISE RELATING TO
    THIS AGREEMENT, ANY TRANSACTION OR ANY OF THE INSTRUMENTS OF
    DOCUMENTS EXECUTED IN CONNECTION HEREWITH.

 

    IN WITNESS WHEREOF, the parties have executed and
    delivered this document as of the date specified on the first
    page of this document.

 

	 	 	 
	

    The Huntington National Bank

	
 
	
    Franklin Credit Management Corporation

	
 
	
 
	
 

	

    By: /s/  Scott
    D. Kleinman

    
Name: Scott
    D. Kleinman

    Title:  Senior Vice President

    Date:  March 7, 2008

    

	
 
	

    By: /s/  Alexander
    Gordon Jardin

    
Name: Alexander
    Gordon Jardin

    Title:  Chief Executive Officer

    

    

    5

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