Document:

Amendment to Lease Agreement

 
Exhibit 10.20

 
ONE STATE STREET, LLC 
One State Stteet Plaza 
New York, NY 10004 
 
 
 
 
December 23, 2002 
 
 
 
 
Ambac Financial Group, Inc. 
One State Street Plaza 
New York, NY 10004

 
 
Attention: Mr. Gregg Bienstock 
 
 
Dear Sirs: 
 
Reference is made to the Lease between South Ferry Building Company, as assigned to One State Street, LLC by assignment dated June 13, 2000, Landlord, and AMBAC Assurance Corporation (formerly known as
AMBAC Indemnity Corporation), as assigned to Ambac Financial Group, Inc. by assignment of even date herewith. Tenant, dated January 1, 1992 (as amended on August 1, 1997, the (“1997 Amendment”) and as may be further amended from time to
time, the “Lease”). Capitalized terms not defined in this Amendment (this “Amendment”) shall have their respective meanings as set forth in the Lease. 
 
Landlord and Tenant hereby agree that the Lease be amended as follows: 
 

	1.	 	Landlord hereby leases to Tenant, and Tenant hereby hires from Landlord and adds to the Premises under the Lease, the entire twentieth (20th) floor (the “20th
Floor Space”) for the period commencing on the date hereof and ending on the Expiration Date (or sooner termination of the Lease), pursuant to the terms, covenants, conditions and provisions of the Lease, subject to the terms hereof. Landlord
shall deliver possession of the entire 20th Floor (20th) floor on the date hereof free and clear of all tenants or other occupants and rights to occupancy. 

 

	2.    (a)	 	In addition to all amounts currently due under 3.01 of the Lease, the Tenant shall, as of the date hereof, with respect to the 20th Floor Space, make an additional
Operating Payment (the “20th Floor Operating Payment”) in accordance with the terms of Section 3.01 of the Lease provided that solely with respect to the 20th Floor Operating Payment: 

 

	 	(i)	 	the Operating Payment multiplier under clause (ii) of the first sentence of the second paragraph of Section 3.01(c) ofthe Lease shall be 27,719;

 

	 	(ii)	 	the Base Wage Rate shall be the Wage Rate (as defined below) in effect on January 1, 2003; 

 

	 	(iii)	 	“Wage Rate” shall be calculated as provided in the Lease except it shall be calculated without regard to fringe benefits. For avoidance of doubt,

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	 	 	 	under such a calculation, the Wage Rate for 2002 is equal to $17.448 and for 2003 is equal to $17.998; and 

 

	 	(iv)	 	the multiplication factor shall equal 125% (rather than the 75 as set forth in Section 3.01(c) of the Lease). 

 

	 	(b)	 	In addition to all amounts currently due under Article 3 of the Lease, the Tenant shall, as of the date hereof, with respect to the 20th Floor Space, make an
additional Tenant’s Tax Payment (the “20th Floor Tax Payment”) in accordance with the terms of Article 3 of the Lease provided that solely with respect to the 20th Floor Tax Payment: 

 

	 	(i)	 	For purposes of calculating Tenant’s Tax Payments allocable to the 20th Floor Space, the Basic Tax shall be one half of the sum of (A) the Taxes for the real
estate tax fiscal year commencing July 1, 2002 and ending June 30, 2003, as finally determined, and (B) the Taxes for the real estate tax fiscal year commencing July 1, 2003 and ending June 30, 2004, as finally determined, and

 

	 	(ii)	 	“Tenant’s Proportionate Share” under Section 3.02(c) of the Lease as applicable to the 20th Floor Space shall be 3.4058%. 

 

	3.    (a)	 	Tenant has examined the 20th Floor Space and agrees to take the same “as is” and Landlord shall not be obligated to perform any work or incur any expense
to prepare the 20th Floor Space for Tenant’s use and the provisions of Landlord’s Work in Article 38 of the Lease shall not apply to the 20th Floor Space, provided that Landlord shall prior to commencement of the Tenant’s initial
buildout of the 20th Floor Space (i) remove the compartmentation walls in the 20th Floor Space within three (3) business days of Tenant’s written request, (ii) perform any necessary additional fireproofing work on the 20th Floor Space to the
extent required by applicable law or requirements, (iii) remove the two pipes protruding from the drain lines and cap the related drain lines and (iv) perform any repairs required to bring the bathrooms to building standard.

 

	 	(b)	 	To the extent required by applicable law, Landlord shall, in conjunction with the Tenant’s initial buildout of its space, perform any work required to bring the
core areas of the 20th floor of the Building in compliance with the American with Disabilities Act of 1990, as amended to date. 

 

	 	(c)	 	Landlord shall deliver to Tenant an ACP-5 Certificate applicable to the area in which Tenant plans to perform construction in connection with its initial buildout of
the 20th Floor Space. Landlord shall deliver to Tenant such ACP-5 Certificate promptly after Tenant delivers to Landlord construction plans for the 20th Floor Space which are sufficient to obtain such ACP-5 Certificate. Landlord, at its sole

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	 	 	 	cost and expense shall remove any asbestos, required to deliver the ACP-5 Certificate described above. 

 

	 	(d)	 	The provisions of Article 14 of the Lease which are applicable to Tenant’s use and consumption of electricity in the 15th, 16th and 17th floors of the Building
shall apply to Tenant’s use and consumption of electricity in the 20th Floor Space; provided (i) the $2.80 per rentable square foot “interim rate” described in Section 14.01 of the Lease shall commence on the date that Tenant
commences its buildout of the 20th Floor Space and (ii) Landlord shall install the meters described in Section 14.01 of the Lease with respect to the 20th Floor Space within six (6) months after commencement by Tenant of its buildout of the 20th
Floor Space and in the event that Landlord fails to install such meters within such six (6) month period then the remedies available to Tenant under Section 37.03 of the Lease with respect to the installation of meters in the 18th floor of the
Building shall be available to Tenant with respect to the installation of meters in the 20th Floor Space. 

 

	 	(e)	 	In connection with Tenant’s initial buildout of the 20th Floor Space, Landlord shall provide Tenant with forty (40) hours of free overtime freight elevator
service. 

 

	4.	 	In addition to the rent for the existing space as set forth in Section 1.04(a) of the Lease, the fixed rents reserved under the Lease for the 20th Floor Space shall
be and consist of the following fixed rent at the following rates during the following periods: 

 

	 	(a)	 	Six Hundred Ninety Two Thousand Two Hundred Seventy Five ($692,975) dollars per annum during the period commencing on the 153rd day following the date hereof (the
“20th Floor Rent Commencement Date”) and ending on the fifth (5th) anniversary of the 20th Floor Rent Commencement Date; 

 

	 	(b)	 	One Million Eighty One Thousand Forty One ($1,081,041) dollars per annum during the period commencing on the day following the fifth (5th) anniversary of the 20th
Floor Rent Commencement Date and ending on the tenth (10th) anniversary of the 20th Floor Rent Commencement Date; and 

 

	 	(c)	 	One Million Four Hundred Sixty Nine Thousand One Hundred Seven ($1,469,107) dollars per annum during the period commencing on the day following the tenth (10th)
anniversary of the 20th Floor Rent Commencement Date and ending on the Expiration Date. 

 

	5.	 	The initial buildout of the 20th Floor Space (“Tenant’s Work”) shall be at the sole cost and expense of Tenant, provided that with respect to the
Tenant’s Work, Landlord shall pay Tenant $1,385,950 (the “TI Payment”) in accordance with the terms hereof. Tenant’s Work shall be done in accordance with Article 11 and the other provisions of the Lease, including
Landlord’s prior approval of plans and specifications if required pursuant to the 

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	 	 	Lease. Landlord shall pay Tenant pro rata portions of the TI Payment based on the percentage of Tenant’s Work completed as estimated by Tenant’s architect
and submitted to Landlord in writing up a maximum of the lesser of the actual aggregate cost of Tenant’s Work or the total TI Payment, provided that any amount of the TI Payment remaining unpaid on the 20th Floor Rent Commencement Date shall be
paid in full on such date for subsequent application by Tenant solely to the cost of Tenant’s Work. 

 

	6.    (a)	 	Landlord hereby grants to Tenant a right of first refusal (the “Right of First Refusal”) with respect to each and every proposed letting of any space in
the elevator bank serving the Premises on the date hereof (a “Letting”) upon the terms and conditions set forth herein. 

 

	 	(b)	 	If at any time Landlord wishes to effect a Letting to any bona fide unaffiliated third party or entity (an “Outside Party”), Landlord shall deliver to
Tenant a deal sheet setting forth the material terms (including, at a minimum, the material economic terms such as the anticipated delivery date, fixed rent, tax and operating escalation rates, base years, tenant improvement allowance and fixed rent
increases) pursuant to which Landlord would be prepared to lease space to an Outside Party (the “Offer”) which shall be deemed to be an offer by Landlord to lease to Tenant the floor (or the portion thereof) or floors which is/are
described in such Offer. Landlord need not have an actual offer from a potential tenant in order to present a deal sheet as aforesaid but must be prepared in good faith to offer such space to the market on such terms in contemplation of leasing such
space to an Outside Party. 

 

	 	(c)	 	The term of the Right of First Refusal shall commence as of the date hereof and shall remain in effect during the Term; provided, however, that notwithstanding the
foregoing the Right of First Refusal shall terminate upon the occurrence of any of the following: 

 

	 	(i)	 	if Tenant exercises the Right of First Refusal and the transaction is not consummated due solely to Tenant’s default, then on the date of such default; or

 

	 	(ii)	 	the occurrence and continuation of an Event of Default. 

 

	 	 	 	Subject to the foregoing provisions of this Section 6(c), the Right of First Refusal, if then subsisting, shall survive any Letting of any kind or nature to an
Outside Party and each and every subsequent Letting shall be subject to the Right of First Refusal. 

 

	 	(d)    (i)	 	Tenant may initiate the exercise of the Right of First Refusal by delivery to Landlord of a notice to that effect (“Notice of Acceptance”) on or before the
fifteenth (15th) day following Tenant’s receipt of the Offer (the “Exercise Period”). If Tenant fails to deliver a Notice of Acceptance within the Exercise Period, Tenant shall be deemed to have elected not to exercise the Right of
First Refusal at that time, and Landlord may let the 

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	 	 	 	applicable floor (or portion thereof) or floors which is the subject of the Offer to an Outside Party upon economic terms that are not lower than ten (10) per cent
less than the economic terms set forth in the Offer, provided that the Letting is in fact closed no later than four (4) months (“Outside Date”) following the expiration of the Exercise Period. If a Letting meeting the requirements of the
immediately preceding sentence of the applicable floor (or portion thereof) or floors which is referred to in the Offer is not closed on or before the Outside Date, then a Letting shall not be consummated with respect to such space without it being
subjected again to the Right of First Refusal. 

 

	 	(ii)	 	If Tenant timely delivers the Notice of Acceptance, Tenant will be deemed to have accepted the Offer and an amendment of this Lease, containing the terms and
conditions of the Offer as modified in accordance with the provisions herein, shall be prepared promptly by Landlord. Tenant and Landlord shall immediately execute such amendment (“Right of First Refusal Amendment”) confirming the
applicable terms and conditions contained in the Offer. Any terms and conditions not expressly addressed in the Offer shall be the same as then current terms of the Lease. The failure of the parties to execute the Right of First Refusal Amendment
shall not affect the respective obligations of the parties under this Lease. 

 

	 	(e)	 	The termination, cancellation or surrender of this Lease shall terminate any rights of Tenant pursuant to this provision. 

 

	7.      (a)	 	Provided this Lease is in effect and Tenant is not in default hereunder beyond any applicable grace period on the date the option is exercised or on the Delivery
Date (as hereinafter defined). Tenant shall have the option (the “Expansion Option”) to add the 21st Floor of the Building (the “Expansion Space”) to the Premises under this Lease as of the earlier of(i) the fourth (4th)
anniversary of the date hereof (the “Fourth Anniversary”) if such space is available on such date or (ii) if the Expansion Space is subject to a lease to an Outside Party as of the Fourth Anniversary, the first day following the Fourth
Anniversary, but prior to the seventh (7th) anniversary of the date hereof (the “Seventh Anniversary”), that the Expansion Space becomes available for occupancy. In the event the Expansion Space is not available on the Fourth Anniversary
and does not become available on or before the Seventh Anniversary, then the Expansion Option shall expire and Tenant’s right to lease the Expansion Space shall terminate. 

 

	 	(b)	 	In the event Landlord enters into a lease of the Expansion Space prior to the Fourth Anniversary with an Outside Party which by its terms shall remain in effect as
of the Fourth Anniversary (the “Other Lease”), Landlord shall advise Tenant of the expiration date for such lease (the “21st Floor Expiration Date”). In the event the 21st Floor Expiration Date is prior to the Seventh Anniversary
(the “Lease Scenario”), the Expansion Option shall be exercised, if at all, by Tenant giving notice to Landlord in writing at least twelve (12) full calendar months prior 

 

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	 	 	 	to the 21st Floor Expiration Date. If the Expansion Space is not subject to a lease as of the Fourth Anniversary (the “Vacant Scenario”), then the
Expansion Option shall be exercised, if at all, by Tenant by giving notice to Landlord in writing at least twelve (12) months, but no more than thirteen (13) full calendar months, prior to the Fourth Anniversary, provided that following such
exercise of the Expansion Option Landlord shall nevertheless retain the right to lease the Expansion Space to an Outside Party prior to the Fourth Anniversary (the period subsequent to such exercise by Tenant of the Expansion Option but prior to the
Fourth Anniversary being referred to herein as the “Interim Period”). In the event of such a letting to an Outside Party during the Interim Period, (x) the exercise of the Expansion Option shall not be deemed effectively exercised and
shall be of no effect and (y) in the event Tenant exercises the Right of First Refusal with respect to such Letting of the Expansion Space during the Interim Period in accordance with Section 6 of this Amendment, the terms of such lease of the
Expansion Space to Tenant shall be determined by this Section 7 instead of Section 6 of this Amendment. Tenant’s failure duly to give notice of its intent to exercise its option as set forth above or below at the end of this paragraph shall be
deemed a waiver of such right to lease the Expansion Space. Time shall be of the essence in respect of the giving of such notice. Upon the effective exercise by Tenant of the Expansion Option, Landlord shall deliver possession of the Expansion Space
in accordance with Section 7(c) on one of the following dates (the “Delivery Date”) as determined by Landlord: (i) in the case of a Lease Scenario, no earlier than six (6) months prior to the 21st Floor Expiration Date and no later than
the sixth (6th) month following the 21st Floor Expiration Date; or (ii) in the case of a Vacant Scenario, the Fourth Anniversary and no later than the sixth (6th) month following the Fourth Anniversary. Notwithstanding the prior provision of this
Section (b), in the case of a Lease Scenario, if at any time during the period between the Fourth Anniversary and the Seventh Anniversary the Other Lease expires (including without limitation by reason of default under the Other Lease) then Landlord
shall promptly notify Tenant and Tenant shall have twenty (20) days to exercise its Expansion Option, and for purposes hereof, if Tenant exercises its Expansion Option pursuant to this sentence, the Delivery Date shall be the date of Tenant’s
notice of its intent to exercise the Expansion Option. 

 

	 	(c)	 	If Tenant shall effectively exercise the Expansion Option, Tenant shall accept the Expansion Space vacant and free and clear of all tenants, other occupants or
rights to occupancy but otherwise “as is” in the state and condition that it may be in on the Delivery Date and Landlord shall have no liability to Tenant by reason of such state and condition, provided that Landlord shall perform, to the
extent necessary, demolition of the space, removal of asbestos and general repair work so as to deliver the Expansion Space in essentially the same condition as the 20th Floor. Landlord makes no representations as to the condition of the Expansion
Space or as to any other thing or fact related thereto and Landlord shall have no obligation 

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	 	 	 	to decorate, repair, alter, improve or otherwise prepare the Expansion Space for Tenant’s occupancy. 

 

	 	(d)	 	If Tenant shall effectively exercise the Expansion Option then, effective on and after the Delivery Date, this Lease shall be deemed amended as follows:

 

	 	(i)	 	The Expansion Space shall be added to and form a part of the Premises, and the term “Premises” as used in this Lease shall include the Expansion Space.

 

	 	(ii)	 	The Fixed Rent payable by Tenant for such Expansion Space shall be ninety five percent (95%) of the fair market Fixed Rent determined as of the commencement date of
the term of the Expansion Space. In such event, on a date that is not less than six (6) months prior to the Delivery Date, Landlord shall submit to Tenant Landlord’s estimate (“Landlord’s Estimate”) of the fair market Fixed Rent
for the Expansion Space. The determination of fair market shall take into account all relevant factors including without limitation rents in all comparable buildings and the fact that current base years shall be used. If Tenant shall not accept
Landlord’s Estimate as the Fixed Rent to be paid for the Expansion Space, Landlord and Tenant shall attempt to agree upon the Fixed Rent to be paid for the Expansion Space, m the event that by the date that is three (3) months prior to the
Delivery Date, Landlord and Tenant shall not have agreed upon the Fixed Rent to be paid by Tenant for the Expansion Space, such dispute shall be submitted to arbitration in accordance with the provisions of Article 39, and the arbitrators shall
determine the fair market Fixed Rent for such Expansion Space for the balance of the Term upon the same terms as provided in the Lease (and in determining such fair market Fixed Rent the arbitrators shall consider the terms relating to payments of
Additional Charges pursuant to Article 3 and shall not include in Fixed Rent any amount for the furnishing of electricity by Landlord to Tenant and instructions to that effect shall be given to the arbitrators), and that amount shall be the Fixed
Rent payable by Tenant for such Expansion Space during the balance of the Initial Term, subject to the other provisions of this Lease. All computations of the fair market Fixed Rent for the Expansion Space pursuant to this Section shall be made
without allocating any value to any leasehold improvements made in or to the Expansion Space. If on the Delivery Date the Fixed Rent to be paid by Tenant for the Expansion Space shall not have been determined (by arbitration or by agreement of
Landlord and Tenant), Tenant shall, effective as of the Delivery Date, pay as Fixed Rent therefor the amount set forth in Landlord’s Estimate as the fair market Fixed Rent for such Expansion Space, subject to adjustment upon the determination
of such Fixed Rent. Upon the determination of such Fixed Rent, Tenant shall promptly pay to Landlord any underpayment of Fixed Rent by Tenant 

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	 	 	 	since the Delivery Date and, in the event of any overpayment of such Fixed Rent by Tenant since the Delivery Date, Landlord, at its election, shall either pay to
Tenant the amount of such overpayment or permit Tenant to receive a credit of the amount of such overpayment against the next installments of Fixed Rent falling due until such time as such overpayment has been fully credited to Tenant and, if the
overpayment has not been fully credited prior to the Expiration Date, Landlord shall promptly after the Expiration Date, pay the uncredited portion of such overpayment to Tenant. Each arbitrator appointed pursuant to this Section shall have at least
10 years’ experience in the City of New York in real property management, brokerage or appraising. 

 

	 	(iii)	 	With respect to the Expansion Space, the term “Tenant’s Proportionate Share”, as such term is defined in Article 3 of the Lease, and the
“Operating Payment” multiplier under clause (ii) of the first sentence of the second paragraph of Section 3.01 (c) of the Lease, shall be equal to those set forth in Section 2 of this Amendment with respect to the 20th Floor Space and
shall be paid in addition to such amounts. 

 

	 	(e)	 	If Landlord is unable to give possession of the Expansion Space on the Delivery Date, because of the holding over or retention of possession of any tenant,
undertenant or occupant or as a result of Force Majeure, any Legal Requirement, casualty or condemnation, Landlord shall have no liability to Tenant therefore and the validity of the Lease shall not be impaired under such circumstances, nor shall
the same be construed in any way to extend the Term, but the rent payable hereunder for the Expansion Space shall be abated (provided Tenant is not responsible for the inability to obtain possession) until Landlord is able to deliver possession of
the Expansion Space for Tenant’s occupancy. Landlord agrees to use reasonable efforts to remove such hold-over and to obtain possession of the Expansion Space. 

 

	 	(f)    (i)	 	Within thirty (30) days after the Delivery Date, Landlord and Tenant shall join in executing and delivering an agreement supplementary hereto clearly identifying the
Delivery Date, the Expansion Space added thereon and specifying the rental payable with respect to such Expansion Space and the items referred to in Section 7(d)(iii). The failure of the parties to execute such agreement shall not affect the
respective obligations of the parties under this Lease. 

 

	 	(iii)	 	In the event the Expansion Option is not exercised by Tenant in respect of any Expansion Space, Tenant agrees, within ten (10) days after demand therefor from
Landlord, to confirm, in writing, that the same has not been so exercised. 

 

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	 	(g)	 	The termination, cancellation or surrender of this Lease shall terminate any rights of Tenant pursuant to this Section. 

 

	8.	 	As of the date hereof and thereafter throughout the term of the Lease, Landlord shall make available, in addition to the condenser water to be provided pursuant to
the Lease, 20 tons of additional condenser water from the Building tower for Tenant’s use, and Tenant shall pay, as additional rent, at the same time together with the payments of the monthly rent under the Lease, the amounts set forth in this
paragraph (hereinafter referred to as the “20th Floor Additional Condenser Water Charges”) for such 20 tons. Pursuant to Article 15 of the Lease, there shall be a one-time tap fee of $1,000 and the condenser water shall be supplied to
Tenant via such tap on the 20th Floor Space. The 20th Floor Additional Condenser Water Charges are Three Hundred Seventy Dollars and Fifty Cents ($370.50) per ton of the maximum permitted use (whether or not Tenant shall use such maximum) per year,
which rate shall be increased on each anniversary of January 1, 2003 to an amount equal to 105 of the Additional Condenser Water Charges payable during the immediately preceding year (without regard to any abatement or setoff which may have been in
effect). 

 

	9.    (a)	 	Tenant shall have the right, at no additional charge, to place an emergency back-up dry cooler air conditioning system (the “Back-up AC System”) for the
Tenant’s computer room on the fourteenth floor of the Building in an area specified on the attached Exhibit A and to install the piping and duct work necessary to connect the Back-up AC System directly to the louvers. Landlord shall have the
right in its sole discretion at its sole cost and expense to move or at Landlord’s expense to cause the Tenant to move and reinstall the equipment (with attendant ductwork, piping and electric) for the Back-up AC System up to 25 feet from the
center point of the installation to another location in the Building, provided that such location shall be one in which the Back-up AC System can properly function throughout the term of this Lease. Except in the case of an emergency, Landlord
agrees that such movement shall occur at a time when the Back-up AC System is not likely to be needed. Tenant represents that the Back-up AC System will be used for emergency back-up for the computer room in the event the primary systems servicing
such space are not functional and for no other purpose. 

 

	 	(b)	 	Tenant shall be solely responsible for the cost and expense of installation, operation, repair and maintenance of the Back-up AC System, including any necessary
piping, ductwork and electricity. Tenant’s installation of the Back-up AC System shall be made in accordance with Article 11 of the Lease, provided that solely for purposes of such installation. Article 11 shall be read as if the space on the
14th Floor for the Back-up AC System was part of the Premises. The Back-up AC System shall be designed, constructed, installed, maintained and operated in compliance with all applicable all statutes, rules, and governmental regulation and good
engineering practices. Tenant shall indemnify and hold Landlord 

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	 	 	 	harmless in accordance with Article 18 of the Lease as a result of any breach of the foregoing. 

 

	 	(c)	 	Access to the 14th Floor and the Back-up AC System shall be: (i) only in the presence of a representative of the Landlord, which Landlord shall endeavor to make
available upon reasonable notice (such as one to two hours, but Tenant shall endeavor to give longer notice), and (ii) only on business days and during business hours, except in the event of an emergency which requires access to the Back-up AC
System, in which case Landlord shall use commercially reasonable efforts to provide immediate access, provided that Tenant shall pay Landlord’s charges for overtime personnel if such overtime or additional personnel were required as a result of
Tenant’s access. An emergency shall include, without limitation, any malfunction of the Building’s cooling system. 

 

	10.	 	Tenant represents that it has not dealt with any brokers in connection with this Amendment, and agrees to indemnify and hold harmless Landlord from and against any
and all claims for brokerage commissions and all costs, expenses and liabilities (including, without limitation, reasonable attorneys fees) by any person, other than Grubb & Ellis, Inc. Landlord represents that it has not dealt with any brokers
other than Grubb & Ellis in connection with this Amendment. 

 

	11.	 	The provisions of Section’s 8 and 9 of the 1997 Amendment shall be applicable to the 20th Floor Additional Space and shall apply to comparable laws, rules and
regulations adopted by applicable governmental authorities. 

 

	12.	 	Landlord has advised Tenant that it requires approval of this Amendment by Landlord’s mortgagee (the “Mortgagee”) and an amendment to the existing
Subordination and Non-Disturbance Agreement (“SNDA”) to reflect this Amendment. The parties agree that this Amendment is binding as of the date hereof, subject to receipt of written approval by the Mortgagee. Accordingly, Landlord shall
promptly submit this Amendment to the Mortgagee and pay the Mortgagee any amounts required under its mortgage to obtain the SNDA. If the Mortgagee does not provide such consent or amendment for the SNDA within thirty days, either party can terminate
this Amendment by written notice to the other party. The SNDA amendment shall be in a form reasonably satisfactory to Tenant. 

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Please confirm your
agreement to this letter by executing and returning a copy of this letter to the undersigned. 
 
 

	 Sincerely,

	
	 ONE STATE STREET, LLC, Landlord

	 By:
	 	 South Ferry Building Company, Managing Member

	
	 By:
	 	 /S/    ABRAHAM WOLFSON

	 Name:
	 	 Abraham Wolfson

	 Title
	 	 General Partner

 
 

	 ACCEPTED AND AGREED TO:
 Ambac Financial Group, Inc., Tenant

	
	 By:
	 	 /S/    GREGG L.
BIENSTOCK

	 Name:
	 	 Gregg L. Bienstock

	 Title:
	 	 Managing DirectorPut Option Agreement

 
EXHIBIT 10.27

 
 
PUT OPTION AGREEMENT 
 
 
between 
 
 
AMBAC ASSURANCE CORPORATION 
 
 
and 
 
 
ANCHORAGE FINANCE MASTER TRUST, 
ON BEHALF OF ITS SERIES

ANCHORAGE FINANCE SUB-TRUST I 
 
 
Dated as of May 23, 2002

 

 
Preamble

 
This Put Option Agreement, dated as of May
23, 2002 (the “Agreement”), is by and between Ambac Assurance Corporation, a Wisconsin corporation (“Ambac Assurance”) and Anchorage Finance Master Trust (the “Master Trust”), a Delaware business
trust, on behalf of its series, Anchorage Finance Sub-Trust I (the “Sub-Trust”). 
 
Recitals 
 
WHEREAS, Ambac Assurance is authorized to issue 4,000 shares of non-cumulative, perpetual preferred stock designated “Auction Market Preferred Shares,” which shares shall not be registered with the Securities and Exchange
Commission under the Securities Act of 1933, as amended, on or before the Put Option Payment Date (defined below) (the “Preferred Stock”); and 
 
WHEREAS, Ambac Assurance and the Master Trust, on behalf of the Sub-Trust, desire to enter into a binding agreement pursuant to which
Ambac Assurance will have the right to sell, at its option, the Preferred Stock to the Master Trust, on behalf of the Sub-Trust, and the Master Trust, on behalf of the Sub-Trust, will have an obligation to purchase the Preferred Stock upon Ambac
Assurance’s exercise of its option and upon the other terms and conditions agreed upon by the parties. 
 
NOW THEREFORE, the parties hereto agree as follows: 
 

	1.	 	Definitions; Interpretation 

 
1.1    The words “herein,” “hereof” and “hereunder” and other words
of similar import refer to this Agreement as a whole and not to any particular section, clause or other subdivision, and references to “Sections” refer to Sections of this Agreement except as otherwise expressly provided.

 
1.2    In this Agreement:

 
“ABC Securities” has the
meaning set forth in the Declaration. 
 
“Agreement” has the meaning set forth above in the Preamble. 
 
“Ambac Assurance” has the meaning set forth above in the Preamble. 
 
“Auction Date” has the meaning set forth in the General Terms of the ABC Securities attached to the Declaration as
Appendix A. 
 

2 

 
“Auction Rate” has the meaning set forth in the General Terms of the ABC Securities attached to the Declaration as Appendix A. 
 
“Broker-Dealer” has the meaning set forth in the Declaration. 
 
“Business Day” has the meaning set forth in
the Declaration. 
 
“Closing Date”
means the date of this Agreement. 
 
“Declaration” means the Declaration of Trust governing the Master Trust, as the same may be amended or restated from time to time. 
 
“Default” has the meaning set forth in the Declaration. 
 
“Delayed Auction” has the meaning set forth
in the General Terms of the ABC Securities attached to the Declaration as Appendix A. 
 
“Delayed Auction Date” has the meaning set forth in the General Terms of the ABC Securities attached to the Declaration as Appendix A. 
 
“Delayed Auction Period” has the meaning set
forth in the General Terms of the ABC Securities attached to the Declaration as Appendix A. 
 
“Delayed Auction Rate” has the meaning set forth in the General Terms of the ABC Securities attached to the Declaration as Appendix A. 
 
“Delayed Distribution Rate” means, for each
Delayed Auction Period, an amount equal to (a) the yield anticipated to be earned during such period on the Trust Property, minus (b) the anticipated expenses of the Sub-Trust for such Delayed Auction Period, provided that such amount shall be
annualized and expressed as an annual rate with respect to the aggregate face amount of the ABC Securities outstanding on the date the Delayed Put Option Premium is determined. 
 
“Delayed Put Option Premium” has the meaning set forth in Section 5.1. 
 
“Delayed Put Option Premium Certificate” has
the meaning set forth in Section 5.2. 
 
“Distribution Rate” means, for each Distribution Period, an amount equal to (a) the Projected Yield for such period, minus (b) the anticipated expenses of the Sub-Trust for such Distribution Period, provided that
such amount shall be annualized and expressed as an annual rate with respect to the aggregate face amount of the ABC Securities outstanding on the date the Put Option Premium is determined. The Distribution Rate for 
 

3 

 
each
Distribution Period will be calculated on the Auction Date occurring on the last Business Day prior to such Distribution Period. 
 
“Distribution Payment Date” has the meaning set forth in the General Terms of the ABC Securities attached to the
Declaration as Appendix A. 
 
“Distribution
Period” has the meaning set forth in the General Terms of the ABC Securities attached to the Declaration as Appendix A. 
 
“Federal Funds Effective Rate” has the meaning set forth in the Declaration. 
 
“Holder” has the meaning set forth in the
Declaration. 
 
“Overnight Rate of
Return” means the rate earned on the earnings on the principal of the Trust Property from each Auction Date to the Distribution Payment Date occurring on the next Business Day, which shall be equal to the Federal Funds Effective Rate in
effect as of the Business Day prior to the date of the determination of the Put Option Premium with respect to the Distribution Period for which such Put Option Premium is calculated. 
 
“Preferred Stock” has the meaning set forth above in the Recitals. 
 
“Projected Yield” means all amounts of
interest (including accreted interest) and other payments due and payable (upon maturity or otherwise) on the principal amount of the Trust Property (excluding any repayment of principal) held by the Sub-Trust during the respective Distribution
Period, plus the amount of interest anticipated to be earned based on the Overnight Rate of Return, as calculated on or prior to 11:00 a.m. on the Auction Date for each respective Distribution Period. 
 
“Put Notice” means a written notice
substantially in the form attached hereto as Annex A. 
 
“Put Option Premium” has the meaning set forth in Section 5. 
 
“Put Option Premium Certificate” has the meaning set forth in Section 5.2. 
 
“Put Option Payment Date” has the meaning set
forth in Section 3.2(a). 
 
“Put Option
Price” has the meaning set forth in Section 4.1. 
 
“Sub-Trust” has the meaning set forth above in the Preamble. 
 
“Tax Matters Partner” has the meaning set forth in the Declaration. 
 
“Trust Property” has the meaning set forth in the Declaration. 
 

4 

 
“Trustee” has the meaning set forth in the Declaration. 
 
In this Agreement, any reference to a “company” shall be construed so as to include any corporation, trust, partnership, limited liability company or other legal entity, wheresoever
incorporated or established. 
 
1.3    In this Agreement, save where the contrary is indicated, any reference to: 
 
(a)  this Agreement or any other agreement or document shall be construed as a reference to this Agreement or, as the case may
be, such other agreement or document as the same may have been, or may from time to time be, amended, varied, novated or supplemented in accordance with its terms; and 
 
(b)  a statute shall be construed as a reference to such statute as the same may have been, or may
from time to time be, amended or re-enacted. 
 
1.4    In this Agreement, any definition shall be equally applicable to both the singular and plural forms of the defined terms. 
 

	2.	 	Put Option; Term 

 
2.1    In consideration of the payment of the Put Option Premium and the Delayed Put Option Premium, if any, the
Master Trust, on behalf of the Sub-Trust, hereby grants to Ambac Assurance the right to require the Master Trust, on behalf of the Sub-Trust, to purchase the Preferred Stock on the terms set forth in this Agreement. 
 
2.2    This Agreement and the put option
created hereby shall remain in effect until the earlier to occur of the following: 
 
(a)  Ambac Assurance terminates this agreement by delivering a written notice to the Master Trust, on behalf of the Sub-Trust, stating that Ambac Assurance is terminating the Agreement on the
next succeeding Auction Date that follows the notice by at least three (3) Business Days and indicating the Auction Date on which the termination shall become effective. Delivery of a termination notice by Ambac Assurance shall be irrevocable; and

 

5 

 
(b) Ambac
Assurance fails to make payment of the Put Option Premium or the Delayed Put Option Premium, if any, and such failure has not been cured within five (5) Business Days. 
 
2.3    This Agreement shall terminate upon Ambac Assurance’s exercise of its rights
under Section 3 and the payment of the Put Option Price under Section 4, provided, however, that Section 7.5 shall survive such termination. 
 

	3.	 	Exercise of Put Option 

 
3.1    The Master Trust, on behalf of the Sub-Trust, agrees that it shall, upon exercise of the option as provided in
Section 3.2, purchase the Preferred Stock from Ambac Assurance for a purchase price equal to the Put Option Price, which Put Option Price shall be payable on the Put Option Payment Date in accordance with Section 4. 
 
3.2    (a)  Ambac Assurance may
exercise the option at any time upon three (3) Business Days’ notice after the date hereof and prior to the termination of this Agreement by serving a Put Notice on the Master Trust, on behalf of the Sub-Trust, specifying a payment date (the
“Put Option PaymentDate”), which shall be the next Distribution Payment Date on or after the third Business Day after service of the Put Notice on the Master Trust, on behalf of the Sub-Trust. Any notice of exercise provided
pursuant to this Section 3.2(a) shall be irrevocable. 
 
(b)  On the Put Option Payment Date, Ambac Assurance shall convey to the Master Trust, on behalf of the Sub-Trust, or its designee Preferred Stock with an aggregate liquidation preference equal to the aggregate face amount
of the ABC Securities outstanding on the Put Option Payment Date. In addition, the number of shares of Preferred Stock delivered shall equal the number of ABC Securities outstanding on the Put Option Payment Date. The Preferred Stock shall be
delivered free and clear of any defect in title, together with all transfer and registration documents (or all notices, instructions or other communications) as are necessary to convey title to the Preferred Stock to the Master Trust, on behalf of
the Sub-Trust (or its nominee). 
 
(c)  For avoidance of doubt, (1) any cash received by the Master Trust, on behalf of the Sub-Trust, as interest or other payments earned on the principal amount of the Trust Property (net of fees and expenses and excluding
any repayment of principal) and not distributed to Holders as of the Put Option Payment Date shall be distributed to Holders and shall not be used to purchase shares of Preferred Stock; and (2) the amount of Preferred Stock purchased from Ambac
Assurance shall be reduced by the amount, if any, by which the aggregate face 
 

6 

 
amount of ABC Securities is
reduced pursuant to principal or interest losses on Trust Property as a result of Defaults as required by the operation of Section 6.1(j) of the Declaration and Section 6(b) of the General Terms of the ABC Securities attached to the Declaration as
Appendix A on or before the Put Option Payment Date. 
 

	4.	 	Payments 

 
4.1    Upon receipt of a Put Notice, the Master Trust will allow the then current assets of the Sub-Trust to mature,
and will deliver the proceeds attributable to principal received upon maturity of the assets (after satisfying the Sub-Trust’s creditors, if any, and after any principal returned to holders of the ABC Securities pursuant to Section 6.1(j) of
the Declaration and Section 6(b) of the General Terms of the ABC Securities attached to the Declaration as Appendix A) to Ambac Assurance on the Put Option Payment Date. The amount of such payment shall be referred to herein as the “Put
Option Price.” 
 
4.2    Payment by the Master Trust, on behalf of the Sub-Trust, of the Put Option Price shall be made on or prior to 3:00 p.m. on the Put Option Payment Date and to the account of Ambac Assurance specified in the
Put Notice. 
 
4.3    Payment
of the Put Option Price by the Master Trust, on behalf of the Sub-Trust, shall be made as provided in Section 4.1 and Section 4.2 without setoff, claim, recoupment, deduction or counterclaim; provided, however, that if Ambac
Assurance exercises its option under Section 3 hereof at any time that it has failed to pay all or a portion of the Put Option Premium or the Delayed Put Option Premium, if any, and such failure has not been cured on or before the Put Option
Payment Date, the Master Trust, on behalf of the Sub-Trust, shall be entitled to set off against the Put Option Price such unpaid portion of the Put Option Premium or the Delayed Put Option Premium, as the case may be. 
 

	5.	 	Put Option Premium 

 
5.1    In consideration for the Master Trust’s agreement to purchase the Preferred Stock on behalf of the
Sub-Trust in accordance with the terms of this Agreement, Ambac Assurance agrees to pay to the Master Trust, on behalf of the Sub-Trust, in US dollars, on each Distribution Payment Date, an amount equal to the product of (A) the Auction Rate on the
ABC Securities for the respective Distribution Period less the Distribution Rate for such Distribution Period, (B) the aggregate face amount of the ABC Securities of the Sub-Trust outstanding at the time the Put Option Premium is calculated and (C)
a fraction, the numerator of which will be the 
 

7 

 
number of calendar days in the
respective Distribution Period, and the denominator of which will be 360 days. 
 
The amount derived in accordance with such formula shall be known herein as the “Put Option Premium.” 
 
If there is a Default during any Distribution Period, then Ambac Assurance agrees to pay to the Master Trust,
on behalf of the Sub-Trust, in US dollars on each Distribution Payment Date following receipt of the Delayed Put Option Premium Certificate an amount, as determined by the Trustee, equal to the product of (A) the Delayed Auction Rate on the ABC
Securities for the Delayed Auction Period less the Delayed Distribution Rate for such Distribution Period, (B) the aggregate face amount of the ABC Securities of the respective Sub-Trust outstanding at the time the Delayed Put Option Premium is
calculated and (C) a fraction, the numerator of which will be the number of calendar days in the respective Delayed Auction Period, and the denominator of which will be 360 days. 
 
The amount derived in accordance with such formula shall be known herein as the “Delayed Put Option
Premium.” 
 
5.2    The amount of the Put Option Premium shall be calculated by the Trustee and delivered in writing (the “Put Option Premium Certificate”), substantially in the form attached hereto as
Annex B, to Ambac Assurance prior to 5:00 p.m. on each Auction Date. The amount of the Delayed Put Option Premium shall be calculated by the Trustee and delivered in writing (the “Delayed Put Option Premium Certificate”) to
Ambac Assurance prior to 5:00 p.m. on the Delayed Auction Date. The Put Option Premium Certificate, and any Delayed Put Option Premium Certificate, also shall set forth the eligible assets held by the Sub-Trust, the anticipated yield earned on each
such asset, any anticipated fees to be paid or incurred by the Trustee on behalf of the Trust and the computation of the Put Option Premium, or the Delayed Put Option Premium, as the case may be, in each case for the respective Distribution Period
and the Delayed Auction Period, respectively, and shall be in the form attached hereto as Annex B. 
 
5.3    If the Put Option Premium, or the Delayed Put Option Premium, if any, is not paid on the date on which it is
due, interest shall accrue thereon at a rate equal to the maximum rate then in effect, during the five (5) day cure period set forth in Section 2.2(b) hereof until such Put Option Premium, or Delayed Put Option Premium, is paid. 
 

	6.	 	Obligations Absolute 

 

8 

 
6.1    The Master Trust, on behalf of the Sub-Trust, acknowledges that, provided Ambac Assurance has complied with the terms of this Agreement, the obligations of the Master Trust, on behalf of the Sub-Trust,
undertaken under this Agreement are absolute, irrevocable and unconditional irrespective of any circumstances whatsoever, including any defense otherwise available to the Master Trust, on behalf of the Sub-Trust, in equity or at law, including,
without limitation, the defense of fraud, any defense based on the failure of Ambac Assurance to disclose any matter, whether or not material, to the Master Trust, on behalf of the Sub-Trust, or any other person, and any defense of breach of
warranty or misrepresentation, and irrespective of any other circumstance which might otherwise constitute a legal or equitable discharge or defense of an insurer, surety or guarantor under any and all circumstances. The enforceability and
effectiveness of this Agreement and the liability of the Master Trust, on behalf of the Sub-Trust, and the rights, remedies, powers and privileges of Ambac Assurance under this Agreement shall not be affected, limited, reduced, discharged or
terminated, and the Master Trust, on behalf of the Sub-Trust, hereby expressly waives, to the fullest extent permitted by applicable law, any defense now or in the future arising by reason of: 
 
(a) the illegality, invalidity or unenforceability of all or
any part of the Declaration; 
 
(b) any action
taken by Ambac Assurance; 
 
(c) any change in the
direct or indirect ownership or control of Ambac Assurance or of any shares or ownership interests thereof; 
 
(d) any other circumstance whatsoever that might otherwise constitute a legal or equitable discharge or defense of or for the Master
Trust, on behalf of the Sub-Trust; 
 
provided,
however, that notwithstanding the provisions of this Section 6.1, the Master Trust, on behalf of the Sub-Trust, shall have no further obligations under this Agreement after the termination of this Agreement. In addition, the breach of any
covenant made in this Agreement by the Master Trust, on behalf of the Sub-Trust, shall not terminate this Agreement or limit the rights of Ambac Assurance hereunder. 
 
6.2    For the avoidance of doubt, no failure or delay by Ambac Assurance in exercising
its rights hereunder shall operate as a waiver of its rights hereunder (except as specifically provided in this Agreement, including, without limitation, in respect of the notice periods and payment dates set forth in Section 3.2(a)) and,
subject to the termination of this Agreement not having occurred, Ambac Assurance may continue to exercise its rights hereunder at any time. 
 

9 

 

	7.	 	Covenants 

 
7.1    Ambac Assurance hereby covenants and agrees that, at all times prior to the earlier of the termination of this
Agreement or completion of the sale of the Preferred Stock to the Master Trust, on behalf of the Sub-Trust, pursuant to this Agreement, it shall not amend, restate, revise or otherwise alter the rights, terms and preferences of the Preferred Stock
whether by operation of merger, reorganization or otherwise, without the prior consent of the Master Trust, on behalf of the Sub-Trust, and it will not register the Preferred Stock with the Securities and Exchange Commission under the Securities Act
of 1933, as amended, on or before the Put Option Payment Date. 
 
7.2    The Master Trust, on behalf of the Sub-Trust, hereby covenants and agrees that, at all times prior to the earlier of the termination of this Agreement or completion of the sale of the Preferred Stock to the
Master Trust, on behalf of the Sub-Trust, pursuant to this Agreement, it shall not amend, restate, revise or otherwise alter the rights, terms and preferences of the ABC Securities whether by operation of merger, reorganization or otherwise and it
will not register the ABC Securities with the Securities and Exchange Commission under the Securities Act of 1933, as amended. 
 
7.3    Ambac Assurance hereby covenants and agrees that any Preferred Stock delivered to the Master Trust, on behalf
of the Sub-Trust, shall rank, at the time of delivery, (a) senior to the common stock of Ambac Assurance and (b) senior to or pari passu with the most senior preferred shares of Ambac then authorized by its Restated Articles of Amendment or then
issued and outstanding; provided that this covenant may be amended with the consent of Ambac Assurance and at least a Majority in Face Amount (as defined in the Declaration) of the ABC Securities. 
 
7.4    Ambac Assurance hereby covenants
and agrees that if Ambac Assurance’s financial strength rating is ever lowered while this Agreement remains effective, Ambac Assurance shall provide written notice to the Trustee, on behalf of the Sub-Trust, of such lowered rating.

 
7.5    Ambac Assurance
hereby covenants and agrees that it will not pay a dividend on its common stock pursuant to the first and second provisos of Section 4 of its Restated Articles of Incorporation unless it receives written assurance from Ambac Financial Group, Inc.
that it will use such dividends for the purposes permitted by such provisos. Such written assurance shall provide that the holders of the Preferred Stock shall be third party beneficiaries of, and entitled to enforce, the provisions of such
assurance as if they were parties 
 

10 

 
thereto. The agreements and
rights set forth in this Section 7.5 shall survive the exercise by Ambac Assurance of its rights under this Agreement, the issuance of the Preferred Stock and the liquidation of the Sub-Trust. 
 

	8.	 	This Agreement to Govern 

 
If there is any inconsistency between any provision of this Agreement and any other agreement, the provisions of this Agreement shall
prevail to the extent of such inconsistency but not otherwise. 
 

	9.	 	Representations and Warranties 

 
9.1    The Master Trust represents and warrants to Ambac Assurance, on behalf of the Sub-Trust, that, as of the date
hereof: 
 
(a)  the Master Trust is duly
organized and validly existing under the Delaware Business Trust Act and has the power and authority to own its assets and to conduct the activities which it conducts; 
 
(b)  the Sub-Trust has been duly formed by the Master Trust in accordance with its Declaration;

 
(c)  its entry into, exercise of its
rights and/or performance of or compliance with its obligations under this Agreement do not and will not violate (1) any law to which it is subject, (2) any of its constitutional documents or (3) any agreement to which it is a party or which is
binding on it or its assets; 
 
(d)  it
has the power to enter into, exercise its rights and perform and comply with its obligations under this Agreement and has taken all necessary action to authorize the execution, delivery and performance of this Agreement; 
 
(e)  it will obtain and maintain in effect and
comply with the terms of all necessary consents, registrations and the like of or with any government or other regulatory body or authority applicable to this Agreement; 
 

11 

 
(f)  its obligations under this Agreement are valid, binding and enforceable at law; 
 
(g)  it is not in default under any agreement to which it is a party or by which it or its assets is or are bound and no
litigation, arbitration or administrative proceedings are current or pending, which default, litigation, arbitration or administrative proceedings are material in the context of this Agreement; 
 
(h)  it is not necessary or advisable in order to
ensure the validity, effectiveness, performance or enforceability of this Agreement that any document be filed, registered or recorded in any public office or elsewhere; 
 
(i)  each of the above representations and warranties will be correct and complied with in all
respects during the term of this Agreement; 
 
(j)  no consent, approval, authorization or order of any court or governmental authority, agency, commission or commissioner or other regulatory authority is required for the consummation by the Master Trust, on behalf of
the Sub-Trust, of the transactions contemplated by this Agreement; and 
 
(k)  assuming compliance with the transfer restrictions with respect to the ABC Securities set forth in the Declaration, neither the Sub-Trust nor the Master Trust is required to register with the Securities and
Exchange Commission as an investment company under the Investment Company Act of 1940, as amended. 
 
9.2    Ambac Assurance represents and warrants to the Master Trust, on behalf of the Sub-Trust, that, as of the date
hereof: 
 
(a)  it is duly organized and
validly existing as a corporation under the corporate law statutes of the State of Wisconsin and has the power and authority to own its assets and to conduct the activities which it conducts; 
 
(b)  its entry into, exercise of its rights and/or
performance of or compliance with its obligations under this Agreement do not and will not violate (1) any law to which it is subject, (2) any of its constitutional documents or (3) any agreement to which it is a party or which is binding on it or
its assets; 
 

12 

 
(c)  it has the power to enter into, exercise its rights and perform and comply with its obligations under this Agreement and has taken all necessary action to authorize the execution, delivery and performance of this
Agreement; 
 
(d)  it will obtain and
maintain in effect and comply with the terms of all necessary consents, registrations and the like of or with any government or other regulatory body or authority applicable to this Agreement; 
 
(e)  its obligations under this Agreement are
valid, binding and enforceable at law; 
 
(f)  it is not in default under any agreement to which it is a party or by which it or its assets is or are bound and no litigation, arbitration or administrative proceedings are current or pending, which default,
litigation, arbitration or administrative proceedings are material in the context of this Agreement; 
 
(g)  it is not necessary or advisable in order to ensure the validity, effectiveness, performance or enforceability of this
Agreement that any document be filed, registered or recorded in any public office or elsewhere; 
 
(h)  each of the above representations and warranties will be correct and complied with in all respects during the term of this Agreement; 
 
(i)  no consent, approval, authorization or order
of any court or governmental authority, agency, commission or commissioner or other regulatory authority is required for the consummation by Ambac Assurance of the transactions contemplated by this Agreement and the sale of the Preferred Stock to
the Master Trust, on behalf of the Sub-Trust, pursuant to the terms hereof need not be registered with the Securities and Exchange Commission under the Securities Act of 1933, as amended; and 
 
(j)  as of the Put Option Payment Date, the
Preferred Stock will be duly authorized for issuance and sale to the Master Trust, on behalf of the Sub-Trust, pursuant to this Agreement and, when issued and delivered by Ambac Assurance pursuant to this Agreement against payment of the Put Option
Price, will be validly issued, fully paid and nonassessable; the Preferred Stock will conform in all respects to the terms of the Preferred Stock set forth in the Restated Articles of Incorporation of Ambac Assurance attached hereto as Annex
C; and the Preferred Stock will not be subject to preemptive or other similar rights. 
 

13 

 

	10.	 	Severability 

 
10.1    Any provision of this Agreement which is or becomes illegal, invalid or unenforceable in any jurisdiction may
be severed from the other provisions of this Agreement without invalidating the remaining provisions hereof, and any such illegality, invalidity or unenforceability shall not invalidate or render illegal or unenforceable such provision in any other
jurisdiction. 
 

	11.	 	Notices 

 
11.1    Each communication to be made hereunder shall be deemed to have been given (i) five (5) days after deposit of
such communication with a reputable national courier service addressed to such party at its address specified below (or at such other address as such party shall specify to the other party hereto in writing) or (ii) when transmitted by facsimile to
such party at its facsimile number specified below (or at such other facsimile number as such party shall specify to the other party hereto in writing): 
 
If to Ambac Assurance at: 
 
Ambac Assurance Corporation 
One State Street Plaza 
New York, New York 10004

Attention:    Robert Starr, Treasurer 
Facsimile:    (212) 208-3108 
 
Copy to:    Kevin Doyle, General Counsel 
 
If to the Master Trust or Sub-Trust at: 
 
The Bank of New York (Delaware) 
P.O. Box 6973 
White Clay Center 
Route 273 
Newark, Delaware 19714 
Attention:    Kristine Gullo 
Facsimile:    (302) 283-8279 
 
Copies to: 
 
The
Bank of New York 
Corporate Trust Administration 
 

14 

 
5 Penn Plaza 
New York, NY 10001 
Attention: Dealing and Trading Group 
Facsimile: (212) 896-7295 
 

	12.	 	Counterparts 

 
This Agreement may be executed in any number of counterparts and by the different parties hereto on separate counterparts each of which
when executed and delivered shall constitute an original, but all the counterparts shall together constitute but one and the same instrument. 
 

	13.	 	Benefit of Agreement and Disclaimer 

 
13.1    This Agreement shall enure to the benefit of each party hereto and its successors and assigns and transferees;
provided that neither party hereto may transfer its rights and obligations hereunder, by operation of law or otherwise, without the prior written consent of the other party. 
 

	14.	 	Amendment and Assignment 

 
14.1    This Agreement may not be amended or modified in any respect, nor may any provision be waived, without the
written agreement of both parties. No waiver by one party of any obligation of the other hereunder shall be considered a waiver of any other obligation of such party. 
 
14.2    Neither the Master Trust, on behalf of the Sub-Trust, nor Ambac Assurance may
assign its rights or obligations under this Agreement to any other person, except that Ambac Assurance may assign its rights and obligations under this Agreement to another person as a result of a merger of Ambac Assurance with another person or as
a result of a sale of all or substantially all of the assets of Ambac Assurance to another person if the other person expressly assumes all of the rights and obligations of Ambac Assurance under this Agreement; and immediately following the merger
or sale of substantially all of its assets, the rating of the substitute preferred stock or the unsecured debt obligations of the other person is at least as high as the credit rating of the Preferred Stock or the general unsecured debt obligations
of Ambac Assurance, as the case may be (or if no such ratings exist, the financial strength rating of Ambac Assurance) immediately prior to the merger or sale. 
 

15 

 

	15.	 	Governing Law 

 
15.1    THIS AGREEMENT SHALL IN ALL RESPECTS BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE
OF NEW YORK. 
 

	16.	 	Jurisdiction 

 
16.1    Each of the parties hereto irrevocably submits to the non-exclusive jurisdiction of the courts of the State of
New York in respect of any action or proceeding arising out of or in connection with this Agreement (“Proceedings”). Each of the parties hereto irrevocably waives, to the fullest extent permitted by applicable law, any objection
that it may now or hereafter have to the laying of the venue of any such Proceedings in the courts of the State of New York and any claim that any Proceeding brought in any such court has been brought in an inconvenient forum. Each of the Master
Trust, on behalf of the Sub-Trust, and Ambac Assurance agrees that it shall at all times have an authorized agent in the State of New York upon whom process may be served in connection with any Proceedings, and each of the Master Trust, on behalf of
the Sub-Trust, and Ambac Assurance hereby authorizes and appoints the Trustee to accept service of all legal process arising out of or connected with this Agreement in the State of New York and service on such person (or substitute) shall be deemed
to be service on the Master Trust, on behalf of the Sub-Trust, or Ambac Assurance, as the case may be. Except upon such a substitution, the Master Trust, on behalf of the Sub-Trust, and Ambac Assurance shall not revoke any such authority or
appointment and shall at all times maintain an agent for service of process in the State of New York. If for any reason such person shall cease to act as agent for the service of process, the Master Trust, on behalf of the Sub-Trust, and Ambac
Assurance shall promptly appoint another such agent, and shall forthwith notify each other of such appointment. The submission to jurisdiction reflected in this paragraph shall not (and shall not be construed so as to) limit the right of any person
to take Proceedings in any court of competent jurisdiction, nor shall the taking of Proceedings in any one or more jurisdictions preclude the taking of Proceedings in any other jurisdiction (whether concurrently or not) if and to the extent
permitted by law. 
 

	17.	 	Limitation of Liability 

 
17.1    It is expressly understood that (a) this Agreement is executed and delivered by The Bank of New York
(Delaware), not individually or personally but solely as Trustee, in the exercise of the powers and authority conferred and vested in it under the Declaration, (b) each of the representations, undertakings and agreements herein made on the part of
the Master Trust, on behalf of the Sub-Trust, is made and intended not as personal representations, 
 

16 

 
undertakings and agreements by
The Bank of New York (Delaware), but is made and intended for the purpose of binding only the Master Trust, on behalf of the Sub-Trust, and (c) under no circumstances shall The Bank of New York (Delaware) be personally liable for the breach or
failure of any obligation, representation, warranty or covenant made or undertaken by the Master Trust, on behalf of the Sub-Trust, under this Agreement or the other related documents. 
 

	18.	 	Replacement of Broker-Dealer 

 
18.1    Ambac Assurance shall have the right to direct the Trustee to replace the Broker-Dealer at any time that Ambac
Assurance believes, in the reasonable good faith exercise of its discretion, that the continued service of such Broker-Dealer could have an adverse impact on the rights and benefits conferred on Ambac Assurance pursuant to this Agreement.

 
18.2    In the event Ambac
Assurance elects to exercise its right described in Section 18.1, Ambac Assurance shall propose to the Trustee a replacement Broker-Dealer. The Trustee shall enter into an agreement with such replacement Broker-Dealer, unless it has a reasonable
basis for failing to do so, in which case the parties shall repeat such process until an acceptable Broker-Dealer is so selected. 
 
 

17 

 
IN WITNESS
WHEREOF the parties hereto have caused this Put Option Agreement to be duly executed as of the day and year first above written. 
 
 

	 ANCHORAGE FINANCE MASTER TRUST, on behalf of its series, Anchorage Finance Sub-Trust I,

	 
	 By:
	 	 The Bank of New York (Delaware), not in its individual capacity but solely as Trustee

	 	 	 
	
	 By:
	 	

	 	 	 Name:
 Title:

 
 
 
 
 

	 AMBAC ASSURANCE CORPORATION

	 	 	 
	 By:
	 	

	 	 	 Name:
 Title:

 
 

 
ANNEX A

 
Form of Put Notice 
 

	To:	 	Anchorage Finance Sub-Trust I 

c/o Bank of New York (Delaware) 
P.O. Box 6973 
502 White Clay Center 
Route 273 
Newark, Delaware 19714 
 
with a copy to: 
 
The Bank of New York 
5 Penn Plaza 
New York, New York 10001 
Attention: Dealing and Trading Group 
 
Date: 
Ladies and Gentlemen: 
 
We refer to the put option agreement dated May 23, 2002 (as heretofore
amended, the “Put Option Agreement”) entered into between us and you. Terms defined in the Put Option Agreement (except where otherwise defined herein) shall have the same respective meanings herein. 
 
This notice is the notice for the purposes of Section 3.2(a) of the Put
Option Agreement. We hereby require you to pay the Put Option Price on the Put Option Payment Date, which shall be [                    ] to the
following account: 
 
[
        ] 
 
Yours
faithfully, 
 
for and on behalf of 
Ambac Assurance Corporation 
 

 
Put Option
Premium Certificate 
 
Ambac Assurance
Corporation 
 
Put Option on Auction Market
Preferred Shares 

 

	 1.
	  	 Distribution Period: [first day of Period]-[last day of Period]: [number of days in
period–generally 28]

	
	 2.
	  	 Auction Rate determined for the Distribution Period on [insert date of Auction].
                        0.000000%
                    $ (0)

	
	 3.
	  	 
	 	  	 Issuer
	    	 Ratings
	  	 Purchase Price
	  	 Yield to Maturity
	  	 Interest

	
	    	
	  	
	  	
	  	

	
	 	  	 One Corp
	    	 A1+/P1
	  	 	  	 	  	 
	
	 	  	 Two Corp
	    	 A1+/P1
	  	 	  	 	  	 
	
	 	  	 Three Corp
	    	 A1+/P1
	  	 	  	 	  	 
	
	 	  	 Four Corp
	    	 A1+/P1
	  	 	  	 	  	 
	
	 	  	 Five Corp
	    	 A1+/P1
	  	 	  	 	  	 
	
	 	  	 Six Corp
	    	 A1+/P1
	  	 	  	 	  	 
	
	 	  	 Seven Corp
	    	 A1+/P1
	  	 	  	 	  	 
	
	 	  	 Eight Corp
	    	 A1+/P1
	  	 	  	 	  	 
	
	 	  	 Nine Corp
	    	 A1/P1
	  	 	  	 	  	 
	
	 	  	 Ten Corp
	    	 A1/P1
	  	 	  	 	  	 
	
	    	
	  	
	  	
	  	

	
	 4.
	  	 	    	 	  	 000,000,000
	  	 0.0%
	  	 $  0.0 

	
	 5.
	  	 Applicable Federal Funds Effective Rate: 0.00%
	  	 	  	 0.0%
	  	 $  0.0 

	
	 6.
	  	 Broker-Dealer Fee
	  	 	  	 0.0%
	  	 $(0.0)

	
	 7.
	  	 Trustee, Custodian and IPA Fees
	  	 	  	 0.0%
	  	 $(0.0)

	
	 8.
	  	 Asset Management Fee
	  	 	  	 0.0%
	  	 $(0.0)

	
	 9.
	  	 Tax Matters Partner Fee
	  	 	  	 0.0%
	  	 $(0.0)

	
	 10.
	  	 Servicing Agent Fee
	  	 	  	 0.0%
	  	 $(0.0)

	
	 11.
	  	 Other Fees and Expenses for the Distribution Period, if any
	  	 	  	 0.0%
	  	 $(0.0)

	
	 12.
	  	 Computation of Put Premium Due on [insert Distribution Payment Date] by 11:00 a.m. New York
Time:
	  	 	  	 0.0%
	  	 $(0.0)

	
	 13.
	  	 The asset manager is in compliance with the investment policy.
	  	 	  	 	  	 

 
 
 

20

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00049-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00049-of-00352.parquet"}]]