Document:

Exhibit10.4 - NSAM 8-K Loan Agreement

   
Exhibit 10.4

LOAN ORIGINATION SERVICES AGREEMENT

TABLE OF CONTENTS

	
				
	 
	 
	 
	PAGE

	1.
	Definitions
	 
	1

	2.
	Provision of Services
	 
	2

	3.
	Standard of Performance
	 
	4

	4.
	Fees for Services
	 
	5

	5.
	Term; Termination
	 
	6

	6.
	Intellectual Property
	 
	8

	7.
	Internal Use; Title, Copies, Return
	 
	8

	8.
	Good Faith Cooperation; Consents
	 
	8

	9.
	Confidentiality
	 
	8

	10.
	Dispute Resolution
	 
	9

	11.
	Warranties; Limitation of Liability; Indemnity
	 
	9

	12.
	Taxes
	 
	10

	13.
	Notices
	 
	11

	14.
	Entire Agreement; Governing Law
	 
	11

	15.
	Counterparts
	 
	11

	16.
	Headings
	 
	11

	17.
	Miscellaneous
	 
	12

	18.
	Severability
	 
	12

	19.
	Assignment
	 
	12

	20.
	Amendments
	 
	12

	21.
	Waiver
	 
	12

	22.
	Binding Effect; Benefit
	 
	12

	23.
	Relationship of the Parties
	 
	13

	24.
	Force Majeure
	 
	13

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LOAN ORIGINATION SERVICES AGREEMENT, dated as of June 30, 2014, by and between NSAM US LLC, a Delaware limited liability company (“NSAM”), and NorthStar Realty Finance Corp., a Maryland corporation (“NorthStar Realty”).
RECITALS
WHEREAS, NorthStar Realty and NorthStar Asset Management Group Inc., a Delaware corporation (“NSAM Parent”) are parties to a Separation Agreement, dated as of June 30, 2014 (the “Separation Agreement”), pursuant to which NorthStar Realty will (i) spin-off its asset management business into a separate publicly traded company, NSAM Parent, and (ii) distribute to the Recipients (as defined in the Separation Agreement) all of the outstanding common stock, par value $0.01 per share, of NSAM Parent in accordance with the terms of the Distribution (as defined in the Separation Agreement);
WHEREAS, following the Distribution, NSAM Parent will operate the NSAM Business (as defined in the Separation Agreement), and NorthStar Realty will operate the NorthStar Realty Business (as defined in the Separation Agreement); and
WHEREAS, following the Distribution, NorthStar Realty desires to receive, and NSAM is willing to provide, or cause to be provided, certain services in connection with NorthStar Realty’s loan origination business for commercial real estate debt and preferred equity (the “Loan Origination Business”), subject to the terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the mutual agreements, provisions and covenants contained in this Agreement, the parties agree as follows:
1.Definitions.
(a)    Capitalized terms used herein and not otherwise defined have the meanings given to such terms in the Separation Agreement.
(b)    For the purposes of this Agreement, the following terms shall have the following meanings:
“Affiliate” means, when used with respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, controls or is controlled by or is under common control with the Person specified.  For purposes of the definition of “Affiliate,” “control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through ownership of voting securities, by contract or otherwise.  For the avoidance of doubt, for purposes of this Agreement, neither NorthStar Realty or its Subsidiaries shall be considered an Affiliate of NSAM or its Affiliates.
“Agreement” means this Loan Origination Services Agreement.
“Distribution Date” means the effective date of the Distribution.
 “Material Adverse Effect” means a material adverse effect on the business, results of operations, financial condition and assets of NorthStar Realty and its subsidiaries, taken as a whole. The parties understand and agree that the following, either alone or in 

combination, shall be excluded from consideration when evaluating the existence of a Material Adverse Effect: (i) changes or effects in the general economic conditions; (ii) changes or effects in general market conditions, including the securities, credit or financial markets; (iii) fluctuations in the market value of common stock (or other debt or equity securities) on the New York Stock Exchange, any other market or otherwise; (iv) changes in GAAP; (v) changes or effects, including legal, tax or regulatory changes, that generally affect the industry in which NorthStar Realty operates; (vi) any failure by NorthStar Realty to meet internal projections, plans or forecasts for any period; (vii) changes or effects that directly arise out of or are directly attributable to the negotiation, execution, public announcement or performance of this Agreement or the compliance with the provisions hereof; (viii) changes or effects that arise out of or are attributable to the commencement, occurrence, continuation or intensification of any war, sabotage, armed hostilities or acts of terrorism; and (ix) the effects of earthquakes, hurricanes or other natural disasters.
“Person” means any individual, partnership, corporation, limited liability company, trust or other entity.
“Providing Party” means NSAM and any Affiliate of NSAM, in each case in its capacity as providing a Service hereunder.
“Receiving Party” means NorthStar Realty and any Subsidiary of NorthStar Realty, in each case in its capacity as receiving a Service hereunder.
“Services” means the services that the Providing Party will provide to the Receiving Party, which shall be such general and administrative services as have historically supported the Loan Origination Business consistent with past practice, including accounting and human resources services, and any Additional Services.
“Subsidiary” of any Person means any corporation or other organization whether incorporated or unincorporated of which at least a majority of the securities or interests having by the terms thereof ordinary voting power to elect at least a majority of the board of directors or others performing similar functions with respect to such corporation or other organization is directly or indirectly owned or controlled by such Person or by any one or more of its Subsidiaries, or by such Person and one or more of its Subsidiaries; provided, however, that no Person that is not directly or indirectly wholly owned by any other Person shall be a Subsidiary of such other Person unless such other Person controls, or has the right, power or ability to control, that Person.
“Term” means, collectively, the Initial Term and any Renewal Term hereof.
2.    Provision of Services.
(a)    Generally.  Subject to the terms and conditions of this Agreement, the Providing Party shall provide, or cause to be provided, to the Receiving Party, solely for the benefit of the Loan Origination Business in the ordinary course of business, the Services, commencing on the Distribution Date through the respective period for the particular Service provided (each such period, a “Service Period”), unless such respective Service Period is earlier terminated in accordance with Section 5.

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(b)    Additional Services.  From time to time after the date hereof, the parties may identify additional services that the Providing Party will provide to the Receiving Party in  accordance with the terms of this Agreement (the “Additional Services”). The parties shall cooperate and act in good faith to agree on the terms pursuant to which any such Additional Service shall be provided. Notwithstanding the foregoing, the Providing Party shall have no obligation to agree to provide Additional Services.
(c)    The Services shall be performed on Business Days during hours that constitute regular business hours for each of NorthStar Realty and NSAM, unless otherwise agreed. The Receiving Party shall not, nor shall any member of its Group, resell, subcontract, license, sublicense or otherwise transfer any of the Services to any Person whatsoever or permit use of any of the Services by any Person other than by the Receiving Party and its Affiliates directly in connection with the conduct of the Loan Origination Business in the ordinary course of business.
(d)    Notwithstanding anything to the contrary in this Section 2 (but subject to the second succeeding sentence), the Providing Party shall have the exclusive right to select, employ, pay, supervise, administer, direct and discharge any of its employees who will perform Services.  The Providing Party shall be responsible for paying such employees’ compensation and providing to such employees any benefits relating to their performance of the Services on behalf of the Providing Party. With respect to each Service, the Providing Party shall use commercially reasonable efforts to have qualified individuals participate in the provision of such Service; provided, however, that (i) the Providing Party shall not be obligated to have any individual participate in the provision of any Service if the Providing Party determines that such participation would adversely affect the Providing Party or its Affiliates; and (ii) none of the Providing Party or its Affiliates shall be required to continue to employ any particular individual during the applicable Service Period.
(e)    Each of the Receiving Party and the Providing Party acknowledges that the purpose of this Agreement is to enable the Receiving Party to receive the applicable Services.  Accordingly, at all times from and after the Distribution Date, each of the Receiving Party and the Receiving Party’s Group, on the one hand, and the Providing Party and the Providing Party’s Group, on the other hand, shall use commercially reasonable efforts to make or obtain, or cause to be made or obtained, any filings, registrations, approvals, permits or licenses; implement, or cause to be implemented, any systems; purchase, or cause to be purchased, any equipment; and take, or cause to be taken, any and all other actions, in each case necessary or advisable to enable it to provide for the Services for itself as soon as reasonably practical, and in any event prior to the expiration of the relevant Service Periods. For the avoidance of doubt, the Providing Party shall not be required to provide any Service for a period longer than the applicable Service Period.
3.    Standard of Performance.
(a)    The Providing Party shall use commercially reasonable efforts to provide, or cause to be provided, to the Receiving Party and the Receiving Party’s Group, as applicable, each Service in a manner generally consistent with the manner and level of care (but no less than a reasonable degree of care) with which such Service was provided to the Loan Origination 

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Business immediately prior to the Distribution Date (or, with respect to any Service not provided prior to the Distribution Date, generally consistent with the manner and level of care with which such Service would be performed by the Providing Party for its own behalf) (the “Performance Standard”), unless otherwise specified in this Agreement.  Notwithstanding the foregoing, the Providing Party shall have no obligation hereunder to provide to the Receiving Party (i) any improvements, upgrades, updates, substitutions, modifications or enhancements to any of the Services unless otherwise specified, or (ii) any Service to the extent that the need for such Service arises, directly or indirectly, from the acquisition by the Receiving Party or any member of its Group, outside the ordinary course of business, of any assets of, or any equity interest in, any Person. The Receiving Party acknowledges and agrees that the Providing Party may be providing services similar to the Services provided hereunder and/or services that involve the same resources as those used to provide the Services to its and its Affiliates’ business units and other third parties, and, accordingly, the Providing Party reserves the right to modify any of the Services or the manner in which any of the Services are provided in the ordinary course of business; provided, however, that no such modification shall materially diminish the Services or have a materially adverse effect on the Loan Origination.
(b)    The Providing Party will use commercially reasonable efforts not to establish priorities, as between the Providing Party and its Affiliates, on the one hand, and the Receiving Party and its Affiliates, on the other hand, as to the provision of any Service, and will use commercially reasonable efforts to provide the Services within a timeframe so as not to materially disrupt the business of the Receiving Party.  Notwithstanding the foregoing, the Receiving Party acknowledges and agrees that, due to the nature of the Services, the Providing Party shall have the right to establish reasonable priorities as between the Providing Party and its Affiliates, on the one hand, and the Receiving Party and its Affiliates, on the other hand, as to the provision of any Service if the Providing Party determines that such priorities are necessary to avoid any adverse effect to the Providing Party and its Affiliates.  If any such priorities are established, the Providing Party shall advise the Receiving Party as soon as possible of any Services that will be delayed as a result of such prioritization, and will use commercially reasonable efforts to minimize the duration and impact of such delays.
4.    Fees for Services.
(a)As compensation for a particular Service, the Providing Party acknowledges and agrees that it is receiving full and adequate consideration pursuant to that certain Asset Management Agreement (the “Asset Management Agreement”), dated as of June 30, 2014, by and among NorthStar Realty and NSAM J-NRF Ltd, a Jersey limited liability company, for each Service, and no further consideration shall be due and payable hereunder for each Service during the term of the Asset Management Agreement.
(b)     If the Asset Management Agreement terminates during the Initial Term or any Renewal Term (as defined herein), then as compensation for a particular Service, the Receiving Party agrees to pay to the Providing Party the fees calculated for each Service, calculated based on the fair market value of the Service, as mutually agreed to by the parties.

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(c)    The Providing Party may engage third-party contractors, at a reasonable cost, to perform any of the Services, to provide professional services related to any of the Services, or to provide any secretarial, administrative, telephone, e-mail or other services necessary or ancillary to the Services (collectively, the “Ancillary Services”) (all of which may be contracted for separately by the Providing Party on behalf of the Receiving Party).
(d)    The Providing Party may cause any third party to which amounts are payable by or for the account of the Receiving Party in connection with Services or Ancillary Services to issue a separate invoice to the Receiving Party for such amounts.  The Receiving Party shall pay or cause to be paid any such separate third-party invoice in accordance with the payment terms thereof.  In the event the Providing Party does use its own funds for any such payments to any third party, the Receiving Party shall reimburse the Providing Party for such payments as invoiced by the Providing Party within 30 days following the date of delivery of such invoice from the Providing Party.
(e)    The Providing Party may, in its discretion and without any liability, suspend any performance under this Agreement upon failure of the Receiving Party to make timely any payments required under this Agreement beyond the applicable cure date specified in Section 5(d)(5) of this Agreement.
(f)    The Receiving Party shall reimburse the Providing Party for all costs of collection of overdue amounts, including any reimbursement required under Section 4(d) and any reasonable attorneys’ fees.
(g)    The Receiving Party acknowledges and agrees that it shall be responsible for any interest or other amounts in respect of any portion of any payments to any third party that the Receiving Party is required to pay.
5.    Term; Termination.
(a)    Initial Term.  The initial term for each of the Services to be provided pursuant to this Agreement shall commence on the Distribution Date and shall continue in full force and effect (subject to Section 5(c) or Section 5(d) hereof) until the date that is three (3) years from the Distribution Date (the “Initial Term”), or the earlier date upon which this Agreement has been otherwise terminated in accordance with Section 5(c) or Section 5(d) hereof.
(b)    Renewal Term. This Agreement will automatically renew the obligation to perform each Service for a successive term of one (1) year (each, a “Renewal Term”) following the expiration of the Term for the particular Service, unless either party decides that it does not wish to renew this Agreement or any particular Service or Additional Services hereunder before the expiration of the Initial Term or any Renewal Term, as applicable, by notifying the other party in writing at least 90 days before the completion of the Initial Term or Renewal Term, as applicable.
(c)    Termination for Cause.
		
	(1)
	The Receiving Party may terminate this Agreement, effective upon 60 days’ prior written notice of termination from NorthStar 

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Realty’s board of Directors (“NorthStar Realty Board of Directors”) to the Providing Party if (i) the Providing Party engages in any act of fraud, misappropriation of funds, or embezzlement against the Receiving Party or any of its subsidiaries; (ii) the Providing Party breaches, in bad faith, any provision of this Agreement or there is an event of gross negligence on the part of the Providing Party in the performance of its duties under this Agreement and, in each case if it has a Material Adverse Effect on NorthStar Realty and, with respect to a breach in bad faith or gross negligence, if the effects of such breach in bad faith or gross negligence can be reversed, such effects are not reversed within a period of 60 days (or 90 days if the Providing Party takes steps to reverse such effects within 30 days of written notice); (iii) there is a commencement of any proceeding relating to the Providing Party’s bankruptcy or insolvency, including an order for relief in an involuntary bankruptcy case or the Providing Party authorizing or filing a voluntary bankruptcy petition that is not dismissed in 60 days; (iv) there is a dissolution of the Providing Party; or (v) unless the NorthStar Realty Board of Directors determines that qualification for taxation as a REIT under the U.S. federal income tax laws is no longer desirable, there is a determination by a court of competent jurisdiction, in a non-appealable binding order, or the Internal Revenue Service, in a closing agreement made under section 7121 of the Code, that a provision of this Agreement caused or will cause NorthStar Realty to fail to satisfy a requirement for qualification as a REIT and, within 60 days of such determination, NSAM has not agreed to amend or modify this Agreement in a manner that would allow NorthStar Realty to qualify as a REIT. Notwithstanding the foregoing, if the Providing Party assigns the Agreement to an Affiliate or a permitted assignee, the events in (iii) and (iv) with respect to such assignee shall not constitute grounds for termination by the Receiving Party.
		
	(2)
	The Providing Party may terminate this Agreement effective upon 60 days’ prior written notice of termination to the Receiving Party in the event that the Receiving Party shall default in the performance or observance of any material term, condition or covenant contained in this Agreement and such default shall continue for a period of 60 days (or 90 days if the Receiving Party takes steps to cure such breach within 30 days of the written notice) after written notice thereof specifying such default and requesting that the same be remedied in such 60-day period. In the event that this Agreement is terminated pursuant to this Section 5(c)(2), the Providing Party shall be entitled to any and all damages 

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and legal remedies arising from or in connection with such default including, but not limited to, direct, indirect, special, consequential, speculative and punitive damages, as well as lost future profits and business in the future.
(d)    Termination Generally.  During the term of this Agreement, this Agreement may be terminated:
		
	(1)
	by the Receiving Party, if the Receiving Party is prohibited by law from receiving such Services from the Providing Party;

		
	(2)
	by the Receiving Party, if the Providing Party or any member of its Group providing Services hereunder is cited by a Governmental Authority for materially violating any law governing the performance of a Service, which violation cannot be or has not been cured by the 30th day from the Receiving Party’s giving of written notice of such citation to the Providing Party;

		
	(3)
	by the Receiving Party, if the Providing Party fails to meet any Performance Standard for a period of three consecutive months, which failure cannot be or has not been cured by the 30th day from the Receiving Party’s giving of written notice of such failure to the Providing Party;

		
	(4)
	by the Providing Party, if the Receiving Party (A) becomes insolvent, (B) files a petition in bankruptcy or insolvency, is adjudicated bankrupt or insolvent or files any petition or answer seeking reorganization, readjustment or arrangement of its business under any law relating to bankruptcy or insolvency, or if a receiver, trustee or liquidator is appointed for any of the property of the other party and within 60 days thereof such party fails to secure a dismissal thereof or (C) makes any assignment for the benefit of creditors;

		
	(5)
	by the Providing Party, if the Receiving Party fails to make any payment for any portion of Services the payment of which is not being disputed in good faith by the Receiving Party, which payment remains unmade by the 60th day from the Providing Party’s giving of written notice of such failure to the Receiving Party; and

		
	(6)
	by the Receiving Party, with respect to a particular Service, upon 60 days prior notice to the Providing Party, if the Receiving Party has determined to perform the respective Service on its own behalf.

(e)    Upon the early termination of any Service pursuant to Section 5(d)(6) or upon the expiration of the applicable Service Period, following the effective time of the 

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termination, the Providing Party shall no longer be obligated to provide such Service; provided, that, the Receiving Party shall be obligated to pay the fees that remain unpaid for such Service performed pro-rata for the period prior to termination and to reimburse the Providing Party for any reasonable out-of-pocket expenses or costs attributable to such termination.
(f)    No termination, cancellation or expiration of this Agreement shall prejudice the right of either party hereto to recover any payment due at the time of termination, cancellation or expiration (or any payment accruing as a result thereof), nor shall it prejudice any cause of action or claim of either party hereto accrued or to accrue by reason of any breach or default by the other party hereto.
(g)    Notwithstanding any provision herein to the contrary, Sections 4, 9 through 12, 19, 23 and 24 of this Agreement shall survive the termination of this Agreement.
6.    Intellectual Property.  The Receiving Party grants to the Providing Party and its Affiliates a limited, non-exclusive, fully paid-up, nontransferable, revocable license, without the right to sublicense, for the term of this Agreement to use all intellectual property owned by or, to the extent permitted by the applicable license, licensed to the Receiving Party solely to the extent necessary for the Providing Party to perform its obligations hereunder.
7.    Internal Use; Title, Copies, Return.  Except to the extent inconsistent with the express terms of the Separation Agreement and any Ancillary Agreement other than this Agreement, each party agrees that:
(a)    title to all systems used in performing any Service provided hereunder shall remain in the Providing Party or its third-party vendors; and
(b)    to the extent the provision of any Service involves intellectual property, including without limitation software programs or patented or copyrighted material, or material constituting trade secrets, the Receiving Party shall not copy, modify, reverse engineer, decompile or in any way alter any of such material, or otherwise use such material in a manner inconsistent with the terms and provisions of this Agreement, without the express written consent of the Providing Party; and upon the termination of any Service, the Receiving Party shall return to the Providing Party, as soon as practicable, any equipment or other property of the Providing Party relating to such Service which is owned or leased by the Providing Party and is or was in its possession or control.
8.    Good Faith Cooperation; Consents. Each party shall use reasonable best efforts to cooperate with the other party in all matters relating to the provision and receipt of the Services. Such cooperation shall include, but not be limited to, exchanging information, providing electronic access to systems used in connection with the Services, performing true-ups and adjustments and obtaining all consents, licenses, sublicenses or approvals necessary to permit each party to perform its obligations hereunder. The Providing Party and the Receiving Party shall each maintain reasonable documentation related to the Services and cooperate with each other in making such information available as needed.
9.    Confidentiality.  Each party shall keep confidential any and all information obtained by it in connection with this Agreement and shall not disclose any such information (or 

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use the same except in furtherance of its duties and obligations under this Agreement) to unaffiliated third parties, except: (i) with the prior written consent of the board of directors of the applicable party; (ii) to legal counsel, accountants and other professional advisors; (iii) to appraisers, financing sources and others in the ordinary course of business; (iv) to third parties who agree to keep such information confidential by contract or by professional or ethical duty and who need to know such information to perform services or to evaluate a prospective transaction; (v) to governmental officials having jurisdiction over the applicable party; (vi) in connection with any governmental or regulatory filings of the applicable party, or disclosure or presentations to such party’s investors; (vii) as required by law or legal process to which a party or any person to whom disclosure is permitted hereunder is subject; or (viii) to the extent such information is otherwise publicly available through the actions of a person other than the party not resulting from the party’s violation of this Section 9. The provisions of this Section 9 shall survive the expiration or earlier termination of this Agreement for a period of one year.
10.    Dispute Resolution.  All disputes, controversies and claims directly or indirectly arising out of or in relation to this Agreement or the validity, interpretation, construction, performance, breach or enforceability of this Agreement shall be finally, exclusively and conclusively settled in accordance with the provisions of Article VIII of the Separation Agreement, which shall apply mutatis mutandis to this Agreement.
11.    Warranties; Limitation of Liability; Indemnity.
(a)    The Receiving Party acknowledges that the Providing Party is not engaged in the business of providing finance, accounting, payroll, human resources, employee benefits, legal or corporate services to third parties and that the Services and Ancillary Services to be provided by the Providing Party to the Receiving Party and the Receiving Party’s Group are being provided as an accommodation to the Receiving Party and the Receiving Party’s Group in connection with the transactions contemplated by the Separation Agreement.  All Services and Ancillary Services are provided “as-is”.
(b)    Other than the statements expressly made by the Providing Party in this Agreement, the Providing Party makes no representation or warranty, express or implied, with respect to the Services and Ancillary Services and, except as provided in Subsection (c) of this Section 11, the Receiving Party hereby waives, releases and renounces all other representations, warranties, obligations and liabilities of the Providing Party, and any other rights, claims and remedies of the Receiving Party against the Providing Party, express or implied, arising by law or otherwise, with respect to any nonconformance, error, omission or defect in any of the Services or Ancillary Services, including (i) any implied warranty of merchantability or fitness for a particular purpose, (ii) any implied warranty of non-infringement or arising from course of performance, course of dealing or usage of trade and (iii) any obligation, liability, right, claim or remedy in tort, whether or not arising from the negligence of the Providing Party.
(c)    None of the Providing Party or any of its Affiliates or any of its or their respective officers, directors, employees, agents, attorneys-in-fact, contractors or other representatives shall be liable for any action taken or omitted to be taken by the Providing Party or such person under or in connection with this Agreement, except that the Providing Party shall be liable for direct damages or losses incurred by the Receiving Party or the Receiving Party’s 

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Group arising out of the gross negligence or willful misconduct of the Providing Party or any of its Affiliates or any of its or their respective officers, directors, employees, agents, attorneys-in-fact, contractors or other representatives in the performance or nonperformance of the Services or Ancillary Services.
(d)    In no event shall the aggregate amount of all such damages or losses for which the Providing Party may be liable under this Agreement exceed the aggregate total sum received by the Providing Party for the Services; provided, that, no such cap shall apply to liability for damages or losses arising from fraud.  Except as provided in Subsection (c) of this Section 11, none of the Providing Party or any of its Affiliates or any of its or their respective officers, directors, employees, agents, attorneys-in-fact, contractors or other representatives shall be liable for any action taken or omitted to be taken by, or the negligence, gross negligence or willful misconduct of, any third party.
(e)    Notwithstanding anything to the contrary herein, none of the Providing Party or any of its Affiliates or any of its or their respective officers, directors, employees, agents, attorneys-in-fact, contractors or other representatives shall be liable for damages or losses incurred by the Receiving Party or any of the Receiving Party’s Affiliates for any action taken or omitted to be taken by the Providing Party or such other person under or in connection with this Agreement to the extent such action or omission arises from actions taken or omitted to be taken by, or the negligence, gross negligence or willful misconduct of, the Receiving Party or any of the Receiving Party’s Affiliates.
(f)    No party hereto or any of its Affiliates or any of its or their respective officers, directors, employees, agents, attorneys-in-fact, contractors or other representatives shall in any event have any obligation or liability to the other party hereto or any such other person whether arising in contract (including warranty), tort (including active, passive or imputed negligence) or otherwise for consequential, incidental, indirect, special or punitive damages, whether foreseeable or not, arising out of the performance of the Services or Ancillary Services or this Agreement, including any loss of revenue or profits, even if a party hereto has been notified about the possibility of such damages.
(g)    The Receiving Party shall indemnify and hold the Providing Party and its Affiliates and any of its or their respective officers, directors, employees, agents, attorneys-in-fact, contractors or other representatives harmless from and against any and all damages, claims or losses that the Providing Party or any such other person may at any time suffer or incur, or become subject to, as a result of or in connection with this Agreement or the Services or Ancillary Services provided hereunder, except those damages, claims or losses incurred by the Providing Party or such other person arising out of the gross negligence or willful misconduct by the Providing Party or such other person.
12.    Taxes.  Each party hereto shall be responsible for the cost of any sales, use, privilege and other transfer or similar taxes imposed upon that party as a result of the performance of the Services. Any amounts payable under this Agreement are exclusive of any goods and services taxes, value added taxes, sales taxes or similar taxes (“Sales Taxes”) now or hereinafter imposed on the performance or delivery of Services, and an amount equal to such taxes so chargeable shall, subject to receipt of a valid receipt or invoice as required below in this 

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Section 13, be paid by the Receiving Party to the Providing Party in addition to the amounts otherwise payable under this Agreement.  In each case where an amount in respect of Sales Tax is payable by the Receiving Party in respect of a Service provided by the Providing Party, the Providing Party shall furnish in a timely manner a valid Sales Tax receipt or invoice to the Receiving Party in the form and manner required by applicable law to allow the Receiving Party to recover such tax to the extent allowable under such law.  Any applicable property taxes resulting from provision of the Services shall be payable by the party owing or leasing the asset subject to such tax.
13.    Notices.  Any notice under this Agreement shall be given in writing, addressed and delivered or mailed, postage prepaid, to the addresses set forth herein (or such other address as a party may identify to the other party from time to time). All notices shall be effective upon receipt.
If to NRF:
NorthStar Realty Finance Corp.    
399 Park Avenue, 18th Floor    
New York, New York 10022    
Attention:  General Counsel
If to NSAM:
NSAM US LLC   
c/o NorthStar Asset Management Group Inc.   
399 Park Avenue, 18th Floor  
New York, New York 10022    
Attn:  General Counsel   

14.    Entire Agreement; Governing Law.   This Agreement contains the entire agreement of the parties and supersedes all prior agreements, understandings and arrangements with respect to the subject matter hereof, provided however that nothing contained in this agreement shall alter the terms of the Asset Management Agreement and provided further that to the extent of any conflict between this agreement and the Asset Management Agreement, the Asset Management Agreement shall control. This Agreement shall be construed in accordance with the laws of the State of New York.
15.    Counterparts.  This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original as against any party whose signature appears thereon, and all of which shall together constitute one and the same instrument.  This Agreement shall become binding when one or more counterparts hereof, individually or taken together, shall bear the signatures of all of the parties reflected hereon as the signatories.
16.    Headings.  The section headings contained in this Agreement are inserted for convenience only, and shall not affect in any way, the meaning or interpretation of this Agreement.

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17.    Miscellaneous.  It is understood that certain provisions of this Agreement may serve to limit the potential liability of the Providing Party. The Receiving Party has had the opportunity to consult with the Providing Party as well as, if desired, its professional advisors and legal counsel as to the effect of these provisions. It is further understood that certain applicable laws may impose liability or allow for legal remedies even where the Providing Party has acted in good faith and that the rights under those laws may be non-waivable. Nothing in this Agreement shall, in any way, constitute a waiver or limitation of any rights which may not be limited or waived in accordance with applicable law.
18.    Severability.  Each provision of this Agreement shall be considered separate from the others and, if for any reason, any provision or its application is determined by a court of competent jurisdiction to be invalid, illegal or unenforceable, then such invalid, illegal or unenforceable provision shall not impair the operation of or affect any other provisions of this Agreement, and either (a) such invalid, illegal or unenforceable provision shall be construed and enforced to the maximum extent legally permissible or (b) the parties shall substitute for the invalid, illegal or unenforceable provision a valid, legal and enforceable provision with a substantially similar effect and intent.
19.    Assignment.  This Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective successors and permitted assigns. No party hereto may assign either this Agreement or any of its rights, interests or obligations hereunder without the prior written approval of the other party hereto; provided, however, that, subject to compliance with the Investment Advisers Act of 1940, if applicable, either party may assign this Agreement without the consent of the other party to any third party that acquires, by any means, including by merger or consolidation, all or substantially all the consolidated assets of such party, so long as such acquirer expressly assumes, in a written instrument in form reasonably satisfactory to the non-assigning party, the due and punctual performance or observance of every agreement and covenant of this Agreement on the part of the assigning party to be performed or observed. Any purported assignment in violation of this Section shall be void and shall constitute a material breach of this Agreement.
20.    Amendments.  This Agreement may be amended or modified only by mutual consent of the parties in writing.
21.    Waiver.  Neither the failure nor any delay on the part of a party to exercise any right, remedy, power or privilege under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power or privilege preclude any other or further exercise of the same or of any other right, remedy, power or privilege, nor shall any waiver of any right, remedy, power or privilege with respect to any occurrence be construed as a waiver of such right, remedy, power or privilege with respect to any other occurrence. No waiver shall be effective unless it is in writing and is signed by the party asserted to have granted such waiver.
22.    Binding Effect; Benefit.  This Agreement and all terms, provisions and conditions hereof shall be binding upon the parties hereto, and shall inure to the benefit of the parties hereto and to their respective successors and assigns.

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23.    Relationship of the Parties.  Nothing in this Agreement shall be deemed or construed by the parties or any third party as creating the relationship of principal and agent, partnership or joint venture between the parties, it being understood and agreed that, except as expressly provided in Section 4(d), no provision contained herein, and no act of the parties, shall be deemed to create any relationship between the parties other than the relationship of independent contractor nor be deemed to vest any rights, interest or claims in any third parties.
24.    Force Majeure.  No party to this Agreement will be responsible for nonperformance resulting from acts beyond the reasonable control of such party; provided that such party uses commercially reasonable efforts to avoid or remove such causes of nonperformance and continues performance under this Agreement with reasonable dispatch as soon as such causes are removed.
[Signature Page Follows]

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IN WITNESS WHEREOF, the parties have caused this Loan Origination Services Agreement to be executed as of the date first written above by their duly authorized representatives.
NSAM US LLC   
     
By    /s/ Ronald J. Lieberman       
    Name:  Ronald J. Lieberman       
    Title:  Executive Vice President, General      
                 Counsel & Secretary     
NORTHSTAR REALTY FINANCE CORP.   
     
By    /s/ Ronald J. Lieberman       
    Name:  Ronald J. Lieberman       
    Title:  Executive Vice President, General      
                 Counsel & Secretary     

[Signature Page to Loan Origination Services Agreement]Exhibit10.5- NSAM 8-K Tax Affiliation

Exhibit 10.5

TAX DISAFFILIATION AGREEMENT
By and Between
NORTHSTAR ASSET MANAGEMENT GROUP INC.
And
NORTHSTAR REALTY FINANCE CORP.
Dated as of June 30, 2014

TABLE OF CONTENTS
        

	
				
	 
	 
	 
	PAGE

	ARTICLE I
	Definition of Terms
	 
	1

	ARTICLE II
	Allocation of Tax Liabilities
	 
	6

	SECTION 2.01
	General Rule
	 
	6

	SECTION 2.02
	Allocations of Taxes
	 
	6

	ARTICLE III
	Preparation and Filing of Tax Returns
	 
	7

	SECTION 3.01
	General
	 
	7

	SECTION 3.02
	NorthStar Realty’s Responsibility
	 
	7

	SECTION 3.03
	NSAM’s Responsibility
	 
	7

	SECTION 3.04
	Tax Accounting Practices
	 
	7

	SECTION 3.05
	Right to Review Tax Returns
	 
	8

	SECTION 3.06
	NSAM Carrybacks and Claims for Refund
	 
	8

	SECTION 3.07
	Apportionment of Earnings and Profits and Tax Attributes
	 
	9

	ARTICLE IV
	Tax Payments
	 
	9

	SECTION 4.01
	Payment of Taxes With Respect to Tax Returns Reflecting Taxes of the Other Company
	 
	9

	SECTION 4.02
	Indemnification Payments
	 
	10

	ARTICLE V
	Tax Benefits
	 
	10

	SECTION 5.01
	Tax Refunds in General
	 
	10

	SECTION 5.02
	Timing Differences and Reverse Timing Differences
	 
	10

	SECTION 5.03
	NSAM Carrybacks
	 
	11

	ARTICLE VI
	Assistance and Cooperation
	 
	12

	SECTION 6.01
	Assistance and Cooperation
	 
	12

	SECTION 6.02
	Income Tax Return Information
	 
	12

	SECTION 6.03
	Reliance
	 
	13

	ARTICLE VII
	Tax Records
	 
	13

	SECTION 7.01
	Retention of Tax Records
	 
	13

	SECTION 7.02
	Access to Tax Records
	 
	14

	ARTICLE VIII
	Tax Contests
	 
	14

	SECTION 8.01
	Notice
	 
	14

	SECTION 8.02
	Control of Tax Contests
	 
	14

	ARTICLE IX
	Effective Date
	 
	15

	ARTICLE X
	Survival of Obligations
	 
	15

	ARTICLE XI
	Treatment of Payments; Tax Gross Up
	 
	15

	SECTION 11.01
	Treatment of Tax Indemnity and Tax Benefit Payments
	 
	15

	SECTION 11.02
	Tax Gross Up
	 
	15

	SECTION 11.03
	Interest Under This Agreement
	 
	15

	ARTICLE XII
	Disagreements
	 
	16

	ARTICLE XIII
	Late Payments
	 
	16

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TABLE OF CONTENTS   
    (continued)

	
				
	ARTICLE XIV
	Expenses
	 
	17

	ARTICLE XV
	General Provisions
	 
	17

	SECTION 15.01
	Notices
	 
	17

	SECTION 15.02
	Binding Effect
	 
	17

	SECTION 15.03
	Waiver
	 
	17

	SECTION 15.04
	Confidentiality
	 
	18

	SECTION 15.05
	Severability
	 
	18

	SECTION 15.06
	Authority
	 
	18

	SECTION 15.07
	Further Action
	 
	18

	SECTION 15.08
	Integration
	 
	19

	SECTION 15.09
	Construction
	 
	19

	SECTION 15.10
	No Double Recovery
	 
	19

	SECTION 15.11
	Counterparts
	 
	19

	SECTION 15.12
	Governing Law; Jurisdiction
	 
	19

	SECTION 15.13
	Waiver of Jury Trial
	 
	20

	SECTION 15.14
	Amendment
	 
	20

	SECTION 15.15
	Subsidiaries
	 
	20

	SECTION 15.16
	Assignability
	 
	20

	SECTION 15.17
	Injunctions
	 
	20

	 
	 
	 
	 

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TAX DISAFFILIATION AGREEMENT (this “Agreement”) entered into as of June 30, 2014, by and between  NORTHSTAR ASSET MANAGEMENT GROUP INC., a Delaware corporation (“NSAM”), and NORTHSTAR REALTY FINANCE CORP., a Maryland corporation ( “NorthStar Realty”).
WHEREAS, the board of directors of NorthStar Realty has determined that it is in the best interests of NorthStar Realty and its shareholders to spin-off NorthStar Realty’s asset management business into a separate publicly traded company, NSAM;
WHEREAS, NorthStar Realty and NSAM have entered into the Separation Agreement (as defined below), which sets forth the principal arrangements between them regarding the spin-off of NorthStar Realty’s asset management business from its other businesses and into NSAM;
WHEREAS, NorthStar Realty intends to distribute to the Recipients (as defined below) all the outstanding shares of NSAM Common Stock (as defined below) pursuant to the Distribution (as defined below);
WHEREAS, NorthStar Realty intends the Distribution to qualify as a tax-free transaction under Sections 355 and 368(a)(1)(D) of the Code (as defined below); and
WHEREAS the Companies (as defined below) desire to provide for and agree upon the allocation between the Companies of liabilities for Taxes (as defined below) arising prior to, as a result of, and subsequent to the Distribution, and to provide for and agree upon other matters relating to Taxes.
NOW, THEREFORE, in consideration of the mutual agreements contained herein, the Companies hereby agree as follows:
ARTICLE I   
  Definition of Terms
For purposes of this Agreement (including the recitals hereof), the following terms have the following meanings, and capitalized terms used but not otherwise defined herein shall have the meaning ascribed to them in the Separation Agreement:
 “Accountant” shall have the meaning set forth in Section 6.02(b).
“Adjusted Party” shall have the meaning set forth in Section 5.02(b).

“Adjustment Request” means any formal or informal claim or request filed with any Tax Authority, or with any administrative agency or court, for the adjustment, refund or credit of Taxes, including (a) any amended Tax Return claiming adjustment to the Taxes as reported on the Tax Return or, if applicable, as previously adjusted, (b) any claim for equitable recoupment or other offset and (c) any claim for refund or credit of Taxes previously paid.
“Affiliate” means, when used with respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, controls or is controlled by or is under common control with the Person specified.  For purposes of the definition of “Affiliate,” “control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through ownership of voting securities, by contract or otherwise.
“Agreement” shall have the meaning set forth in the preamble of this Agreement.
 “Ancillary Agreements” means this Agreement, the Management Agreement, the Services Agreement, the Contribution Agreement, the Employee Matters Agreement and any instruments, assignments and other documents and agreements executed in connection with the implementation of the transactions contemplated by the Separation Agreement.
“Base Rate” shall be the rate as set forth in Article XIII.
“Closing Date” means the date of the Distribution.
“Code” means the U.S. Internal Revenue Code of 1986, as amended.
“Companies” means NorthStar Realty and NSAM, collectively, and “Company,” as the context requires, means either NorthStar Realty or NSAM.
“Distribution” has the meaning set forth in the Separation Agreement.
“Final Determination” means a determination within the meaning of Section 1313 of the Code or any similar provision of state or local Tax Law.
“Governmental Entity” shall mean any federal, state, local, foreign or international court, government, department, commission, board, bureau, agency, official or other legislative, judicial, regulatory, administrative or governmental authority.
 “Group” means the NorthStar Realty Group or the NSAM Group, or both, as the context requires.

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“Indemnitee” shall have the meaning set forth in Section 11.03.
“Indemnitor” shall have the meaning set forth in Section 11.03.
“IRS” means the United States Internal Revenue Service.
“NorthStar Realty” shall have the meaning set forth in the preamble of this Agreement.
“NorthStar Realty Group” means NorthStar Realty and each of its direct and indirect Subsidiaries, expressly excluding any entity that is a member of the NSAM Group.
“NorthStar Realty Separate Return” means any Separate Return of NorthStar Realty or any member of the NorthStar Realty Group.
“NorthStar Realty Tainting Act” means an action taken by NorthStar Realty that results in a Final Determination that the Transactions failed to be tax-free by reason of (i) failing to qualify the Distribution as a distribution described in Sections 355 and 368(a)(1)(D) of the Code, (ii) any stock or obligations of NSAM failing to qualify as “qualified property” within the meaning of Section 355(c)(2) of the Code or, where applicable, failing to be stock or securities permitted to be received without recognition of gain or loss under Section 361(a) of the Code or (iii) the application of Sections 355(d) or 355(e) of the Code to the Distribution.
“NSAM” shall have the meaning set forth in the preamble of this Agreement.
“NSAM Carryback” means any net operating loss, net capital loss, excess tax credit or other similar Tax item of NSAM that may or must be carried from one Tax Period to another prior Tax Period under the Code or other applicable Tax Law.
“NSAM Common Stock” means the common stock of NSAM, par value $0.01 per share.
“NSAM Group” means NSAM and any of its direct or indirect Subsidiaries.
“NSAM Separate Return” means any Separate Return of NSAM or any member of the NSAM Group.
“NSAM Tainting Act” means an action taken by NSAM that results in a Final Determination that the Transactions failed to be tax-free by reason of (i) failing to qualify the Distribution as a distribution described in Sections 355 and 368(a)(1)(D) of the Code, (ii) any stock or obligations of NSAM failing to qualify as “qualified property” within the meaning of 

3

Section 355(c)(2) of the Code or, where applicable, failing to be stock or securities permitted to be received without recognition of gain or loss under Section 361(a) of the Code or (iii) the application of Sections 355(d) or 355(e) of the Code to the Distribution.
“Past Practices” shall have the meaning set forth in Section 3.04(a).
“Payment Date” means (i) with respect to any NorthStar Realty income tax return, the due date for any required installment of estimated taxes determined under Section 6655 of the Code, the due date (determined without regard to extensions) for filing the return determined under Section 6072 of the Code, and the date the return is filed, and (ii) with respect to any other Tax Return, the corresponding dates determined under the applicable Tax Law.
“Person” means an individual, a partnership, a corporation, a limited liability company, an association, a joint stock company, a trust, a joint venture, an unincorporated organization and a Governmental Entity or any department, agency or political subdivision thereof, without regard to whether any entity is treated as disregarded for U.S. Federal income tax purposes.
“Post-Closing Period” means any Tax Period that, to the extent it relates to a member of the NSAM Group, begins after the Closing Date and the portion of any Straddle Period ending after the Closing Date.
“Pre-Closing Period” means any Tax Period that, to the extent it relates to a member of the NSAM Group, ends on or before the Closing Date and the portion of any Straddle Period ending on the Closing Date.
“Recipients” has the meaning set forth in the Separation Agreement.
“Responsible Company” means, with respect to any Tax Return, the Company having responsibility for preparing and filing such Tax Return under this Agreement.
“Separate Return” means (a) in the case of any Tax Return of any member of the NSAM Group (including any consolidated, combined or unitary return), any such Tax Return that does not include any member of the NorthStar Realty Group and (b) in the case of any Tax Return of any member of the NorthStar Realty Group (including any consolidated, combined or unitary return), any such Tax Return that does not include any member of the NSAM Group.
“Separation” has the meaning set forth in the Separation Agreement.

4

“Separation Agreement” means the Separation Agreement, dated as of June 30, 2014, by and between NSAM and NorthStar Realty.
“Signing Group” shall have the meaning set forth in Section 6.03.
“Straddle Period” means any Tax Period beginning on or before and ending after the Closing Date.
“Subsidiary” of any Person means any corporation or other organization whether incorporated or unincorporated of which at least a majority of the securities or interests having by the terms thereof ordinary voting power to elect at least a majority of the board of directors or others performing similar functions with respect to such corporation or other organization is directly or indirectly owned or controlled by such Person or by any one or more of its Subsidiaries, or by such Person and one or more of its Subsidiaries; provided, however, that no Person that is not directly or indirectly wholly owned by any other Person shall be a Subsidiary of such other Person unless such other Person controls, or has the right, power or ability to control, that Person.
“Supplier Group” shall have the meaning set forth in Section 6.03.
“Tax” or “Taxes” means any income, gross income, gross receipts, profits, capital stock, franchise, withholding, payroll, social security, workers’ compensation, unemployment, disability, property, ad valorem, stamp, excise, severance, occupation, service, sales, use, license, lease, transfer, import, export, value added, alternative minimum, estimated or other tax (including any fee, assessment or other charge in the nature of or in lieu of any tax) imposed by any Governmental Entity or political subdivision thereof, and any interest, penalties, additions to tax, or additional amounts in respect of the foregoing.
“Tax Advisor” means a United States tax counsel or accountant of recognized national standing.
“Tax Arbitrator” shall have the meaning set forth in Article XII.
“Tax Arbitrator Dispute” shall have the meaning set forth in Article XII.
“Tax Attribute” or “Attribute” means a net operating loss, net capital loss, unused investment credit, unused foreign tax credit, excess charitable contribution, general business credit, Tax basis or any other Tax Item that could reduce a Tax.

5

“Tax Authority” means, with respect to any Tax, the Governmental Entity or political subdivision thereof that imposes such Tax, and the agency (if any) charged with the collection of such Tax for such entity or subdivision.
“Tax Benefit” means any refund, credit or other reduction in otherwise required Tax payments.
“Tax Contest” means an audit, review, examination or other administrative or judicial proceeding with the purpose or effect of redetermining Taxes (including any administrative or judicial review of any claim for refund).
“Tax Detriment” means any increase in required Tax payments (or, without duplication, the reduction in any refund or credit).
“Tax Item” means, with respect to any income Tax, any item of income, gain, loss, deduction or credit.
“Tax Law” means the law of any Governmental Entity or political subdivision thereof relating to any Tax.
“Tax Period” means, with respect to any Tax, the period for which the Tax is reported as provided under the Code or other applicable Tax Law.
“Tax Records” means Tax Returns, Tax Return workpapers, documentation relating to any Tax Contests and any other books of account or records required to be maintained under the Code or other applicable Tax Laws or under any record retention agreement with any Tax Authority.
“Tax Return” or “Return” means any report of Taxes due, any claim for refund of Taxes paid, any information return with respect to Taxes, or any other similar report, statement, declaration or document required to be filed under the Code or other Tax Law, including any attachments, exhibits or other materials submitted with any of the foregoing, and including any amendments or supplements to any of the foregoing.
“Transactions” means the Distribution, the Separation and the other transactions, including the Restructuring Transactions, contemplated by the Separation Agreement.
“Transactions-Related Proceeding” means any Tax Contest in which the IRS, another Tax Authority or any other party asserts a position that could reasonably be expected to increase the tax cost of any Transaction to NorthStar Realty or its shareholders.

6

ARTICLE II   
  Allocation of Tax Liabilities
SECTION 2.01    General Rule.  (a) NorthStar Realty Liability.  NorthStar Realty shall be liable for, and shall indemnify and hold harmless the NSAM Group from and against any liability for, Taxes that are allocated to NorthStar Realty under this Article II.
(b)    NSAM Liability.  NSAM shall be liable for, and shall indemnify and hold harmless the NorthStar Realty Group from and against any liability for, Taxes that are allocated to NSAM under this Article II.
SECTION 2.02    Allocations of Taxes.  Taxes shall be allocated as follows:
(a)    Allocation of Taxes to NorthStar Realty.  NorthStar Realty shall be responsible for any and all Taxes due or required to be reported on any NorthStar Realty Separate Return (including any increase in such Tax as a result of a Final Determination) and all Taxes of NorthStar Realty and its direct or indirect Subsidiaries for any Pre-Closing Period.
(b)    Allocation of Taxes to NSAM.  NSAM shall be responsible for any and all Taxes due or required to be reported on any NSAM Separate Return (including any increase in such Tax as a result of a Final Determination) and any Taxes of NSAM and its direct or indirect Subsidiaries for any Post-Closing Period.
(c)    Straddle Period.  For purposes of this Section 2.02, whenever it is necessary to determine the responsibility for Taxes for a Straddle Period, the determination of Taxes for the portion of the Straddle Period ending on and including, and the portion of the Straddle Period beginning after the Closing Date shall be determined by assuming that the Straddle Period consists of two taxable years or periods, one of which ends at the close of the Closing Date and the other of which begins at the beginning of the date after the Closing Date, and items of income, gain, loss or credit, and state and local apportionment factors for the Straddle Period shall be allocated between such two taxable years or periods on a “closing of the books basis” by assuming that the books of NorthStar Realty or NSAM, as applicable, are closed at the close of business on the Closing Date; provided, however, (i) exemptions, allowances or deductions that are calculated on an annual basis, such as the deduction for depreciation; and (ii) periodic taxes, such as real and personal property taxes, shall be apportioned ratably between such periods on a daily basis.
(d)    Tainting Acts.  NSAM shall indemnify and hold harmless NorthStar Realty from and against any liability of NorthStar Realty for Taxes to the extent such Taxes are attributable to a NSAM Tainting Act; provided, however, that NSAM shall have no obligation to 

7

indemnify NorthStar Realty under this Section 2.02(d) if there has occurred, prior to such NSAM Tainting Act, a NorthStar Realty Tainting Act.
ARTICLE III   
  Preparation and Filing of Tax Returns
SECTION 3.01    General.  Except as otherwise provided in this Article III, Tax Returns shall be prepared and filed when due (including extensions) by the Person obligated to file such Tax Returns under the Code or applicable Tax Law.  The Companies shall provide, and shall cause their Affiliates to provide, assistance and cooperation to one another in accordance with Article VI with respect to the preparation and filing of Tax Returns, including providing information required to be provided in Article VI.
SECTION 3.02    NorthStar Realty’s Responsibility.  NorthStar Realty has the exclusive obligation and right to prepare and file, or to cause to be prepared and filed:
(a)    NorthStar Realty income tax returns for all Tax Periods; and
(b)    NorthStar Realty Separate Returns and NSAM Separate Returns that NorthStar Realty reasonably determines are required to be filed by the Companies or any of their Affiliates for Tax Periods ending on, before or after the Closing Date (limited, in the case of NSAM Separate Returns, to such Returns as are filed on or prior to the Closing Date).
SECTION 3.03    NSAM’s Responsibility.  NSAM shall prepare and file, or shall cause to be prepared and filed, all NSAM Separate Returns other than those Tax Returns filed on or prior to the Closing Date.
SECTION 3.04    Tax Accounting Practices.  (a) General Rule.  Except as provided in Section 3.04(b), with respect to any Tax Return that NSAM has the obligation and right to prepare and file, or cause to be prepared and filed, under Section 3.03, for any Pre-Closing Period (and the portion, ending on the Closing Date, of any Tax Period that includes but does not end on the Closing Date), such Tax Return shall be prepared in accordance with past practices, accounting methods, elections or conventions (“Past Practices”) used by NorthStar Realty with respect to the Tax Returns in question (unless there is no reasonable basis for the use of such Past Practices) solely to the extent a change in such Past Practice could reasonably be expected to cause NorthStar Realty to incur a Tax Detriment, and to the extent any items are not covered by Past Practices (or in the event that there is no reasonable basis for the use of such Past Practices), in accordance with reasonable Tax accounting practices.  Except as provided in Section 3.04(b), NorthStar Realty shall prepare any Tax Return that it has the obligation and right 

8

to prepare and file, or cause to be prepared and filed, under Section 3.02, in accordance with reasonable Tax accounting practices selected by NorthStar Realty.
(b)    Reporting of Transaction Tax Items.  NSAM and NorthStar Realty shall file all Tax Returns consistent with the Tax treatment (including the value of NSAM) of the Transactions as determined by NorthStar Realty, unless there is no reasonable basis for such Tax treatment.
(c)    Detrimental Tax Positions.  Neither NSAM nor NorthStar Realty shall take a position on any Tax Return that is reasonably expected to cause a Tax Detriment to the other party without the written consent of such party, such consent not to be unreasonably withheld or delayed.
SECTION 3.05    Right to Review Tax Returns.  (a) General.  The Responsible Company with respect to any material Tax Return shall make such Tax Return and related workpapers available for review by the other Company, if requested, to the extent (i) such Tax Return relates to Taxes for which the requesting party would reasonably be expected to be liable, (ii) the requesting party would reasonably be expected to be liable in whole or in part for any additional Taxes owing as a result of adjustments to the amount of such Taxes reported on such Tax Return, (iii) such Tax Return relates to Taxes for which the requesting party would reasonably be expected to have a claim for Tax Benefits under this Agreement or (iv) the requesting party reasonably determines that it must inspect such Tax Return to confirm compliance with the terms of this Agreement.  The Responsible Company shall use reasonable best efforts to make such Tax Return available for review, including by delivering such materials to the requesting party at the requesting party’s expense, as required under this paragraph sufficiently in advance of the due date (including extensions) for filing of such Tax Return to provide the requesting party with a meaningful opportunity to analyze and comment on such Tax Return.
(b)    Execution of Returns Prepared by Other Party.  In the case of any Tax Return that is required to be prepared and filed by the Responsible Company under this Agreement and that is required by law to be signed by the other Company (or by its authorized representative), the Company that is legally required to sign such Tax Return shall be required to sign such Tax Return unless there is no reasonable basis for the Tax treatment of an item reported on the Tax Return or the Tax treatment of an item reported on the Tax Return should, in the opinion (reasonably acceptable in form and substance to the Responsible Company) of a Tax Advisor, subject the other Company (or its authorized representatives) to material penalties.

9

SECTION 3.06    NSAM Carrybacks and Claims for Refund.  (a) NSAM hereby agrees that, unless NorthStar Realty consents in writing, no Adjustment Request with respect to any Tax Return for the Pre-Closing Period shall be filed; provided, however, that upon the reasonable request of NSAM, NorthStar Realty shall use reasonable best efforts to make, at NSAM’s expense, an Adjustment Request claiming a refund of Taxes for the Pre-Closing Period with respect to a NSAM Carryback arising in a Post-Closing Period related to U.S. Federal or state Taxes (any such Adjustment Request to be prepared and filed by NorthStar Realty) where, in NorthStar Realty’s reasonable discretion, such Adjustment Request will not materially impair the ability of NorthStar Realty to use Tax Attributes.  NorthStar Realty shall not take any action that would impair the use of any Tax Attribute by a member of the NSAM Group without the prior written consent of NSAM.
(b)    NSAM, upon the request of NorthStar Realty, agrees to repay the amount paid over to NSAM (plus any penalties, interest or other charges imposed by the relevant Tax Authority) in the event NorthStar Realty is required to repay such refund to such Tax Authority.
SECTION 3.07    Apportionment of Earnings and Profits and Tax Attributes.  NorthStar Realty shall in good faith advise NSAM in writing of the portion, if any, of any earnings and profits, Tax Attributes or other consolidated, combined or unitary attributes that NorthStar Realty determines shall be allocated or apportioned to the NSAM Group under applicable law.  NSAM and all members of the NSAM Group shall prepare all Tax Returns in accordance with such written notice.  As soon as practicable after receipt of a written request from NSAM, NorthStar Realty shall provide copies of any studies, reports and workpapers supporting such allocations and apportionments.  In the event of a subsequent adjustment by the applicable Tax Authority to such allocations and apportionments, NorthStar Realty shall promptly notify NSAM in writing of such adjustment.  For the avoidance of doubt, NorthStar Realty shall not be liable to any member of the NSAM Group for any failure of any determination under this Section 3.07 to be accurate under applicable Tax Law.
ARTICLE IV   
  Tax Payments
SECTION 4.01    Payment of Taxes With Respect to Tax Returns Reflecting Taxes of the Other Company.  In the case of any Tax Return reflecting Taxes allocated hereunder to the Company that is not the Responsible Company:
(a)    Computation and Payment of Tax Due.  At least 3 business days prior to any Payment Date for any Tax Return, the Responsible Company shall compute the amount of Tax required to be paid to the applicable Tax Authority (taking into account the requirements of 

10

Section 3.04 relating to consistent accounting practices) with respect to such Tax Return on such Payment Date.  The Responsible Company shall pay such amount to such Tax Authority on or before such Payment Date (and provide notice and proof of payment to the other Company).
(b)    Computation and Payment of Liability With Respect to Tax Due.  Within 30 days following the earlier of (i) the due date (including extensions) for filing any such Tax Return (excluding any Tax Return with respect to payment of estimated Taxes or Taxes due with a request for extension of time to file) or (ii) the date on which such Tax Return is filed, if NorthStar Realty is the Responsible Company, then NSAM shall pay to NorthStar Realty the amount allocable to the NSAM Group under the provisions of Article II, and if NSAM is the Responsible Company, then NorthStar Realty shall pay to NSAM the amount allocable to NorthStar Realty under the provisions of Article II, in each case, plus interest computed at the Base Rate on the amount of the payment based on the number of days from the earlier of (A) the due date of the Tax Return (including extensions) or (B) the date on which such Tax Return is filed to the date of payment.
(c)    Adjustments Resulting in Underpayments.  In the case of any adjustment pursuant to a Final Determination with respect to any such Tax Return, the Responsible Company shall pay to the applicable Tax Authority when due any additional Tax due with respect to such Tax Return required to be paid as a result of such adjustment pursuant to a Final Determination.  The Responsible Company shall compute the amount attributable to the NSAM Group in accordance with Article II and NSAM shall pay to NorthStar Realty any amount due NorthStar Realty (or NorthStar Realty shall pay NSAM any amount due NSAM) under Article II within 30 days from the later of (i) the date the additional Tax was paid by the Responsible Company or (ii) the date of receipt of a written notice and demand from the Responsible Company for payment of the amount due, accompanied by evidence of payment and a statement detailing the Taxes paid and describing in reasonable detail the particulars relating thereto.  Any payments required under this Section 4.01(c) shall include interest computed at the Base Rate based on the number of days from the date the additional Tax was paid by the Responsible Company to the date of the payment under this Section 4.01(c).
SECTION 4.02    Indemnification Payments.  All indemnification payments under this Agreement shall be made by NorthStar Realty directly to NSAM and by NSAM directly to NorthStar Realty; provided, however, that if the Companies mutually agree with respect to any such indemnification payment, any member of the NorthStar Realty Group, on the one hand, may make such indemnification payment to any member of the NSAM Group, on the other hand, and vice versa.

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ARTICLE V   
  Tax Benefits
SECTION 5.01    Tax Refunds in General.  Except as set forth below, NorthStar Realty shall be entitled to any refund (and any interest thereon received from the applicable Tax Authority) of Taxes for which NorthStar Realty is liable hereunder, and NSAM shall be entitled to any refund (and any interest thereon received from the applicable Tax Authority) of Taxes for which NSAM is liable hereunder, and a Company receiving a refund to which another Company is entitled hereunder shall pay over such refund to such other Company within 30 days after such refund is received (together with interest computed at the Base Rate based on the number of days from the date the refund was received to the date the refund was paid over).
SECTION 5.02    Timing Differences and Reverse Timing Differences.  (a) If as a result of an adjustment pursuant to a Final Determination to any Taxes for which a member of the NorthStar Realty Group is liable hereunder (or Tax Attribute of a member of the NorthStar Realty Group) a member of the NSAM Group could realize a current or future Tax Benefit that it could not realize but for such adjustment (determined on a with and without basis), or if as a result of an adjustment pursuant to a Final Determination to any Taxes for which a member of the NSAM Group is liable hereunder (or Tax Attribute of a member of the NSAM Group) a member of the NorthStar Realty Group could realize a current or future Tax Benefit that it could not realize but for such adjustment (determined on a with and without basis), NSAM or NorthStar Realty, as the case may be, shall make a payment to either NorthStar Realty or NSAM, as appropriate, within 30 days following the date of a written notice and demand from NorthStar Realty or NSAM, as appropriate, for payment of the amount due, accompanied by evidence of such adjustment and describing in reasonable detail the particulars relating thereto.  Any payment required under this Section 5.02(a) shall include interest on such payment computed at the Base Rate based on the number of days from the date of such written notice to the date of payment under this Section 5.02(a).  In the event that NorthStar Realty or NSAM disagrees with any such calculation described in this Section 5.02(a), NorthStar Realty or NSAM shall so notify the other Company in writing within 30 days of receiving the written calculation set forth above in this Section 5.02(a).  NorthStar Realty and NSAM shall endeavor in good faith to resolve such disagreement.
(b)    If a member of the NSAM Group actually realizes in cash pursuant to a Final Determination any Tax Detriment as a result of an adjustment pursuant to a Final Determination to any Taxes for which a member of the NorthStar Realty Group is liable hereunder (or Tax Attribute of a member of the NorthStar Realty Group) (in such circumstance, NorthStar Realty being the “Adjusted Party”) and such Tax Detriment would not have arisen but 

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for such adjustment (determined on a with and without basis), or if a member of the NorthStar Realty Group actually realizes in cash pursuant to a Final Determination any Tax Detriment as a result of an adjustment pursuant to a Final Determination to any Taxes for which a member of the NSAM Group is liable hereunder (or Tax Attribute of a member of the NSAM Group) (in such circumstance, NSAM being the “Adjusted Party”) and such Tax Detriment would not have arisen but for such adjustment (determined on a with and without basis), the Adjusted Party shall make a payment to the other party within 30 days following the later of such actual realization of the Tax Detriment and the Adjusted Party’s actual realization of the corresponding Tax Benefit, in an amount equal to the lesser of such Tax Detriment actually realized in cash and the Tax Benefit, if any, actually realized in cash by the Adjusted Party pursuant to such adjustment (which would not have arisen but for such adjustment), plus interest on such amount computed at the Base Rate based on the number of days from the later of the date of such actual realization of the Tax Detriment and the Adjusted Party’s actual realization of the corresponding Tax Benefit to the date of payment of such amount under this Section 5.02(b).  No later than 30 days after a Tax Detriment described in this Section 5.02(b) is actually realized in cash by a member of the NorthStar Realty Group or a member of the NSAM Group, NorthStar Realty (if a member of the NorthStar Realty Group actually realizes such Tax Detriment) or NSAM (if a member of the NSAM Group actually realizes such Tax Detriment) shall provide the other Company with a written calculation of the amount payable pursuant to this Section 5.02(b).  In the event that NorthStar Realty or NSAM disagrees with any such calculation described in this Section 5.02(b), NorthStar Realty or NSAM shall so notify the other Company in writing within 30 days of receiving the written calculation set forth above in this Section 5.02(b).  NorthStar Realty and NSAM shall endeavor in good faith to resolve such disagreement.
SECTION 5.03    NSAM Carrybacks.  NSAM shall be entitled to any refund actually received in cash that is attributable to, and would not have arisen but for (determined on a with and without basis), a NSAM Carryback pursuant to the proviso set forth in Section 3.06, provided that the refund is a refund of Taxes for the Tax Period to which the NSAM Carryback is carried or the first or second immediately following Tax Periods.  Any such payment of such refund made by NorthStar Realty to NSAM pursuant to this Section 5.03 shall be recalculated in light of any Final Determination (or any other facts that may arise or come to light after such payment is made, such as a carryback or carryforward of a NorthStar Realty Group Tax Attribute to a Tax Period in respect of which such refund is received) that would affect the amount to which NSAM is entitled, and an appropriate adjusting payment shall be made by NSAM to NorthStar Realty such that the aggregate amounts paid pursuant to this Section 5.03 equals such recalculated amount (with interest computed at the Base Rate based on the number of days from the date of the actual receipt of such refund to the date of payment of such amount under this Section 5.03).

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ARTICLE VI   
  Assistance and Cooperation
SECTION 6.01    Assistance and Cooperation.  (a) After the Distribution, the Companies shall cooperate (and cause their respective Affiliates to cooperate) with each other and with each other’s agents, including accounting firms and legal counsel, in connection with Tax matters relating to the Companies and their Affiliates, including (i) preparation and filing of Tax Returns, (ii) determining the liability for and amount of any Taxes due (including estimated Taxes) or the right to and amount of any refund of Taxes, (iii) examinations of Tax Returns and (iv) any administrative or judicial proceeding in respect of Taxes assessed or proposed to be assessed.  Such cooperation shall include making all information and documents in their possession relating to the other Company and its Affiliates available to such other Company as provided in Article VII.  Each of the Companies shall also make available to the other, as reasonably requested and available, personnel (including officers, directors, employees and agents of the Companies or their respective Affiliates) responsible for preparing, maintaining and interpreting information and documents relevant to Taxes, and personnel reasonably required as witnesses or for purposes of providing information or documents in connection with any administrative or judicial proceedings relating to Taxes.
(b)    Any information or documents provided under this Article VI shall be kept confidential by the Company receiving the information or documents, except as may otherwise be necessary in connection with the filing of Tax Returns or in connection with any administrative or judicial proceedings relating to Taxes.
SECTION 6.02    Income Tax Return Information.  NSAM and NorthStar Realty acknowledge that time is of the essence in relation to any request for information, assistance or cooperation made by NorthStar Realty or NSAM pursuant to Section 6.01 or this Section 6.02.  NSAM and NorthStar Realty acknowledge that failure to conform to the deadlines set forth herein or reasonable deadlines otherwise set by NorthStar Realty or NSAM could cause irreparable harm.
(a)    Each Company shall provide to the other Company information and documents relating to its Group required by the other Company to prepare Tax Returns.  Any information or documents the Responsible Company requires to prepare such Tax Returns shall be provided in such form as the Responsible Company reasonably requests and in sufficient time for the Responsible Company to file such Tax Returns on a timely basis.
(b)    In the event that a party fails to provide any information requested by the other party pursuant to Section 6.01 or this Section 6.02 within the deadlines as set forth herein, a 

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party shall have the right to engage a nationally recognized public accounting firm of its choice (the “Accountant”), in its sole and absolute discretion, to gather such information directly from the other party.  The parties agree, and will cause all other members of their Group to agree, upon 10 business days’ notice, in the case of a failure to provide information pursuant to Section 6.01 or this Section 6.02, to permit any such Accountant full access to all records or other information requested by such Accountant during reasonable business hours.  Such other party agrees to promptly pay all reasonable costs and expenses incurred by the requesting party in connection with the engagement of such Accountant.
SECTION 6.03    Reliance.  If any member of one Group (the “Supplier Group”) supplies information to a member of the other Group (the “Signing Group”) in connection with a Tax liability and an officer of a member of the Signing Group signs a statement or other document under penalties of perjury in reliance upon the accuracy of such information, then upon the written request of such member of the Signing Group identifying the information being so relied upon, the chief financial officer of the Supplier Group (or any officer of the Supplier Group as designated by the chief financial officer of the Supplier Group) shall certify in writing that to his or her knowledge (based upon consultation with appropriate employees) the information so supplied is accurate and complete.  The Company that is a member of the Supplier Group agrees to indemnify and hold harmless each member of the Signing Group and its directors, officers and employees from and against any fine, penalty or other cost or expense of any kind attributable to a member of the Supplier Group having supplied, pursuant to this Article VI, a member of the Signing Group with inaccurate or incomplete information in connection with a Tax liability.
ARTICLE VII   
  Tax Records
SECTION 7.01    Retention of Tax Records.  Each Company shall preserve and keep all Tax Records exclusively relating to the assets and activities of its Group for Pre-Closing Periods (and the portion, ending on the Closing Date, of any Tax Period that includes but does not end on the Closing Date), and NorthStar Realty shall preserve and keep all other Tax Records relating to Taxes of its Group for Pre-Closing Periods until the later of (i) the expiration of any applicable statutes of limitation, and (ii) 7 years after the Closing Date.  After such earlier date, each Company may dispose of such records upon 90 days’ prior written notice to the other Company.  If, prior to the expiration of the applicable statute of limitation or such 7-year period, a Company reasonably determines that any Tax Records that it would otherwise be required to preserve and keep under this Article VII are no longer material in the administration of any matter under the Code or other applicable Tax Law and the other Company agrees, then such first 

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Company may dispose of such records upon 90 days’ prior written notice to the other Company.  Any written notice of an intent to dispose given pursuant to this Section 7.01 shall include a list of the records to be disposed of describing in reasonable detail each file, book or other record accumulation being disposed.  The notified Company shall have the opportunity, at its cost and expense, to copy or remove, within such 90-day period, all or any part of such Tax Records.
SECTION 7.02    Access to Tax Records.  The Companies and their respective Affiliates shall make available to each other for inspection and copying (or delivery, at the requesting party’s expense) during normal business hours upon reasonable notice all Tax Records in their possession to the extent reasonably required by the other Company in connection with the preparation of Tax Returns, audits, litigation or the resolution of items under this Agreement.
ARTICLE VIII   
  Tax Contests
SECTION 8.01    Notice.  Each of the parties shall provide prompt written notice to the other party of any written communication from a Tax Authority regarding any pending or threatened Tax audit, assessment or proceeding or other Tax Contest of which it becomes aware related to Taxes for Tax Periods for which it is indemnified by the other party hereunder.  Such written notice shall attach copies of the pertinent portion of any written communication from a Tax Authority and contain factual information (to the extent known) describing any asserted Tax liability in reasonable detail and shall be accompanied by copies of any notice and other documents received from any Tax Authority in respect of any such matters.
SECTION 8.02    Control of Tax Contests.  (a) NorthStar Realty Returns.  In the case of any Tax Contest with respect to any NorthStar Realty income tax return, NorthStar Realty shall have exclusive control over the Tax Contest, including exclusive authority with respect to any settlement of Tax liability arising from such Tax Contest.  NorthStar Realty shall keep NSAM informed in a timely manner regarding such Tax Contests to the extent relating to the NSAM Group or the assets transferred to NSAM pursuant to the Transactions insofar as such Tax Contests would reasonably be expected to affect the NSAM Group.
(b)    NSAM Separate Returns.  In the case of any Tax Contest with respect to a NSAM Separate Return, NSAM shall have exclusive control over the Tax Contest, including exclusive authority with respect to any settlement of Tax liability arising from such Tax Contest.
(c)    Transactions-Related Proceedings.  In the event of any Transactions-Related Proceeding as a result of which NSAM could reasonably be expected to become liable for any amounts that NorthStar Realty is entitled to control under this Article VIII, (A) NorthStar 

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Realty shall consult with NSAM reasonably in advance of taking any significant action in connection with such Transactions-Related Proceeding, (B) NorthStar Realty shall consult with NSAM and offer NSAM a reasonable opportunity to comment before submitting any written materials prepared or furnished in connection with such Transactions-Related Proceeding, (C) NorthStar Realty shall defend such Transactions-Related Proceeding diligently and in good faith and (D) NorthStar Realty shall provide NSAM copies of any written materials relating to such Transactions-Related Proceeding received from the relevant Tax Authority.
ARTICLE IX   
  Effective Date
This Agreement shall be effective as of the date hereof.
ARTICLE X   
  Survival of Obligations
The representations, warranties, covenants and agreements set forth in this Agreement shall be unconditional and absolute and shall remain in effect without limitation as to time, unless otherwise specified herein.
ARTICLE XI   
  Treatment of Payments; Tax Gross Up
SECTION 11.01    Treatment of Tax Indemnity and Tax Benefit Payments.  In the absence of any change in Tax treatment under applicable Tax Law:
(a)    any Tax indemnity payments made by a Company under Article IV shall be reported for Tax purposes by the payor and the recipient as distributions or capital contributions, as appropriate, occurring immediately before the Distribution or as payments of an assumed or retained liability, and
(b)    any Tax Benefit payments made by a Company under Article V shall be reported for Tax purposes by the payor and the recipient as distributions or capital contributions, as appropriate, occurring immediately before the Distribution or as payments of an assumed or retained liability.
SECTION 11.02    Tax Gross Up.  If, notwithstanding the manner in which Tax indemnity payments and Tax Benefit payments were reported, there is an adjustment to the Tax liability of a Company as a result of its receipt of a payment pursuant to this Agreement, such payment shall be appropriately adjusted so that the amount of such payment, reduced by the 

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amount of all income Taxes payable with respect to the receipt thereof (but taking into account all correlative Tax Benefits resulting from the payment of such income Taxes), shall equal the amount of the payment that the Company receiving such payment would otherwise be entitled to receive pursuant to this Agreement.
SECTION 11.03    Interest Under This Agreement.  Anything herein to the contrary notwithstanding, to the extent one Company (“Indemnitor”) makes a payment of interest to another Company (“Indemnitee”) under this Agreement with respect to the period from the date that the Indemnitee made a payment of Tax to a Tax Authority to the date that the Indemnitor reimbursed the Indemnitee for such Tax payment, the interest payment shall be treated as interest expense to the Indemnitor (deductible to the extent provided by law) and as interest income by the Indemnitee (includible in income to the extent provided by law).  The amount of the payment shall not be adjusted under Section 11.02 to take into account any associated Tax Benefit to the Indemnitor or Tax Detriment to the Indemnitee.
ARTICLE XII
  Disagreements
The Companies mutually desire that collaboration will continue between them.  Accordingly, they will try, and they will cause their respective Group members to try, to resolve in an amicable manner all disagreements and misunderstandings connected with their respective rights and obligations under this Agreement, including any amendments hereto.  In furtherance thereof, in the event of any dispute or disagreement (a “Tax Arbitrator Dispute”) between the Companies as to the interpretation of any provision of this Agreement or the performance of obligations hereunder, the Companies shall negotiate in good faith to resolve the Tax Arbitrator Dispute.  If such good faith negotiations do not resolve the Tax Arbitrator Dispute, then the matter, upon written request of either Company, will be referred to a tax lawyer or accountant acceptable to each of the Companies (the “Tax Arbitrator”).  The Tax Arbitrator may, in its discretion, obtain the services of any third-party appraiser, accounting firm or consultant that the Tax Arbitrator deems necessary to assist it in resolving such disagreement.  The Tax Arbitrator shall furnish written notice to the Companies of its resolution of any such Tax Arbitrator Dispute as soon as practical, but in any event no later than 45 days after its acceptance of the matter for resolution.  Any such resolution by the Tax Arbitrator will be conclusive and binding on the Companies.  Following receipt of the Tax Arbitrator’s written notice to the Companies of its resolution of the Tax Arbitrator Dispute, the Companies shall each take or cause to be taken any action necessary to implement such resolution of the Tax Arbitrator.  In accordance with Article XIV, each Company shall pay its own fees and expenses (including the fees and expenses of its representatives) incurred in connection with the referral of the matter to the Tax Arbitrator.  All 

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fees and expenses of the Tax Arbitrator in connection with such referral shall be shared equally by the Companies.  Nothing in this Article XII will prevent either Company from seeking injunctive relief if any delay resulting from the efforts to resolve the Tax Arbitrator Dispute through the Tax Arbitrator could result in serious and irreparable injury to either Company.
ARTICLE XIII   
  Late Payments
Any amount owed by one party to another party under this Agreement that is not paid when due shall bear interest at three (3) month London Interbank Offer Rate (LIBOR), compounded semiannually, from the due date of the payment to the date paid (the “Base Rate”).  To the extent interest required to be paid under this Article XIII duplicates interest required to be paid under any other provision of this Agreement, interest shall be computed at the higher of the interest rate provided under this Article XIII or the interest rate provided under such other provision.
ARTICLE XIV   
  Expenses
Except as otherwise provided in this Agreement, each party and its Affiliates shall bear their own expenses incurred in connection with preparation of Tax Returns, Tax Contests, and other matters related to Taxes under the provisions of this Agreement.
ARTICLE XV
  General Provisions
SECTION 15.01    Notices.
Any notice under this Agreement shall be given in writing, addressed and delivered or mailed, postage prepaid, to the addresses set forth herein (or such other address as a party may identify to the other party from time to time). All notices shall be effective upon receipt.
If to NorthStar Realty, to:
NorthStar Realty Finance Corp.   
399 Park Avenue, 18th Floor  New York, New York 10022   
Attn:  General Counsel  Fax:  212-547-2700

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If to NSAM to:   
NorthStar Asset Management Group Inc.  399 Park Avenue, 18th Floor 
New York, New York 10022   
Attn:  General Counsel  Fax:  212-547-2700

Either party may, by written notice to the other party, change the address to which such notices are to be given.
SECTION 15.02    Binding Effect.  This Agreement and all terms, provisions and conditions hereof shall be binding upon the parties hereto, and shall inure to the benefit of the parties hereto and to their respective successors and permitted assigns.
SECTION 15.03    Waiver.  Neither the failure nor any delay on the part of a party to exercise any right, remedy, power or privilege under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power or privilege preclude any other or further exercise of the same or of any other right, remedy, power or privilege, nor shall any waiver of any right, remedy, power or privilege with respect to any occurrence be construed as a waiver of such right, remedy, power or privilege with respect to any other occurrence. No waiver shall be effective unless it is in writing and is signed by the party asserted to have granted such waiver.
SECTION 15.04    Confidentiality.   Each party shall keep confidential any and all information obtained by it in connection with this Agreement and shall not disclose any such information (or use the same except in furtherance of its duties and obligations under this Agreement) to unaffiliated third parties, except: (i) with the prior written consent of the board of directors of the applicable party; (ii) to legal counsel, accountants and other professional advisors; (iii) to appraisers, financing sources and others in the ordinary course of business; (iv) to third parties who agree to keep such information confidential by contract or by professional or ethical duty and who need to know such information to perform services or to evaluate a prospective transaction; (v) to governmental officials having jurisdiction over the applicable party; (vi) in connection with any governmental or regulatory filings of the applicable party, or disclosure or presentations to such party’s investors; (vii) as required by law or legal process to which a party or any person to whom disclosure is permitted hereunder is subject; or (viii) to the extent such information is otherwise publicly available through the actions of a person other than the party not resulting from the party’s violation of this Section. The provisions of this Section shall survive the expiration or earlier termination of this Agreement for a period of one year.

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SECTION 15.05    Severability.  Each provision of this Agreement shall be considered separate from the others and, if for any reason, any provision or its application is determined by a court of competent jurisdiction to be invalid, illegal or unenforceable, then such invalid, illegal or unenforceable provision shall not impair the operation of or affect any other provisions of this Agreement, and either (a) such invalid, illegal or unenforceable provision shall be construed and enforced to the maximum extent legally permissible or (b) the parties shall substitute for the invalid, illegal or unenforceable provision a valid, legal and enforceable provision with a substantially similar effect and intent.
SECTION 15.06    Authority.  Each of the parties represents to the other that (a) it has the corporate or other requisite power and authority to execute, deliver and perform this Agreement, (b) the execution, delivery and performance of this Agreement have been duly authorized by all necessary corporate or other action, (c) it has duly and validly executed and delivered this Agreement, and (d) this Agreement is a legal, valid and binding obligation, enforceable against it in accordance with its terms, subject to applicable bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability relating to or  affecting creditors’ rights and to general equity principles.
SECTION 15.07    Further Action.  The parties shall execute and deliver all documents, provide all information, and take or refrain from taking action as may be necessary or appropriate to achieve the purposes of this Agreement, including the execution and delivery to the other parties and their Affiliates and representatives of such powers of attorney or other authorizing documentation as is reasonably necessary or appropriate in connection with Tax Contests (or portions thereof) under the control of such other parties in accordance with Article VIII.
SECTION 15.08    Integration.  This Agreement constitutes the final agreement between the parties and is the complete and exclusive statement of the parties’ agreement on the matters contained herein.  All prior and contemporaneous negotiations and agreements between the parties with respect to the matters contained herein are superseded by this Agreement, as applicable.  In the event of any inconsistency between this Agreement and the Separation Agreement, or any other agreements relating to the transactions contemplated by the Separation Agreement, with respect to matters addressed herein, the provisions of this Agreement shall control.
SECTION 15.09    Construction.  The language in all parts of this Agreement shall in all cases be construed according to its fair meaning and shall not be strictly construed for or against any party.  The captions, titles and headings included in this Agreement are for convenience only, and do not affect this Agreement’s construction or interpretation.  Unless 

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otherwise indicated, all “Section” and “Article” references in this Agreement are to sections and articles of this Agreement.
SECTION 15.10    No Double Recovery.  No provision of this Agreement shall be construed to provide an indemnity or other recovery for any costs, damages, or other amounts for which the damaged party has been fully compensated under any other provision of this Agreement or under any other agreement or action at law or equity.  Unless expressly required in this Agreement, a party shall not be required to exhaust all remedies available under other agreements or at law or equity before recovering under the remedies provided in this Agreement.
SECTION 15.11    Counterparts.  This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original as against any party whose signature appears.
SECTION 15.12    Governing Law; Jurisdiction.
(a)    THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED IN THE STATE OF NEW YORK AND WITHOUT REGARD TO ITS CHOICE OF LAW PRINCIPLES.
(b)    Any action or proceeding arising out of or relating to this Agreement shall be brought in the courts of the State of New York located in the County of New York or in the United States District Court for the Southern District of New York (if any party to such action or proceeding has or can acquire jurisdiction), and each of the parties hereto or thereto irrevocably submits to the exclusive jurisdiction of each such court in any such action or proceeding, waives any objection it may now or hereafter have to venue or to convenience of forum, agrees that all claims in respect of the action or proceeding shall be heard and determined only in any such court and agrees not to bring any action or proceeding arising out of or relating to this Agreement in any other court.  The parties to this Agreement agree that any of them may file a copy of this paragraph with any court as written evidence of the knowing, voluntary and bargained agreement between the parties hereto and thereto irrevocably to waive any objections to venue or to convenience of forum.  Process in any action or proceeding referred to in the first sentence of this Section 15.11(b) may be served on any party to this Agreement or any Ancillary Agreement anywhere in the world.
SECTION 15.13    Waiver of Jury Trial.  EACH PARTY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES (TO THE EXTENT PERMITTED BY APPLICABLE LAW) ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY OF ANY DISPUTE 

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ARISING UNDER OR RELATING TO THIS AGREEMENT AND AGREES THAT ANY SUCH DISPUTE SHALL BE TRIED BEFORE A JUDGE SITTING WITHOUT A JURY.
SECTION 15.14    Amendment.  This Agreement may be amended or modified only by mutual consent of the parties in writing.
SECTION 15.15    Subsidiaries.  If, at any time, NSAM or NorthStar Realty, respectively, acquires or creates one or more subsidiaries that are includable in the NSAM Group or the NorthStar Realty Group, respectively, they shall be subject to this Agreement and all references to the NSAM Group or NorthStar Realty Group, respectively, herein shall thereafter include a reference to such subsidiaries.
SECTION 15.16    Assignability. This Agreement shall not be assignable, in whole or in part, directly or indirectly, by any party without the prior written consent of the other party, and any attempt to assign any rights or obligations under this Agreement without such consent shall be void; provided that either party may assign this Agreement to a purchaser of all or substantially all of the properties and assets of such party so long as such purchase expressly assumes, in a written instrument in form reasonably satisfactory to the non-assigning party, the due and punctual performance or observance of every agreement and covenant of this Agreement on the part of the assigning party to be performed or observed.
SECTION 15.17    Injunctions.  The parties acknowledge that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with its specific terms or were otherwise breached.  The parties hereto shall be entitled to an injunction or injunctions to prevent breaches of the provisions of this Agreement and to enforce specifically the terms and provisions hereof in any court having jurisdiction, such remedy being in addition to any other remedy to which they may be entitled at law or in equity.
[Signature Page Follows]

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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their duly authorized representatives as of the date set forth above.

	
			
	 
	NORTHSTAR ASSET MANAGEMENT GROUP INC.

	 
	 

	 
	 

	 
	By
	/s/ Ronald J. Lieberman

	 
	 
	Name: Ronald J. Lieberman

	 
	 
	Title: Executive Vice President, General Counsel & Secretary

	 
	 

	 
	 

	 
	NORTHSTAR REALTY FINANCE CORP.

	 
	 

	 
	 
	 

	 
	By
	/s/ Ronald J. Lieberman

	 
	 
	Name: Ronald J. Lieberman

	 
	 
	Title: Executive Vice President, General Counsel & Secretary

[Signature Page to Tax Disaffiliation Agreement]

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