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Exhibit 10.8    
    

 

	 	 	 
	ACQUISITION REPURCHASE AGREEMENT
	 	 	 
	 	 	 
	by and among
	 	 	 
	 	 	 
	
[                                         
       ]

as Buyer,
	 	 	 
	 	 	 
	and
	 	 	 
	 	 	 
	GRAMERCY CAPITAL CORP.
	 	 	 
	and
	 	 	 
	GKK CAPITAL LP,

as the Seller
	 	 	 
	and
	 	 	 
	the Additional Sellers from time to time parties hereto
	 	 	 
	 	 	 
	Dated as of July     , 2004
	 	 	 
	 	 	 

 

  

 
 

TABLE OF CONTENTS    
    

	 
	 	 
	 	Page

	ARTICLE I

APPLICABILITY
	

Section 1.01	
 	

Purchase and Sale	
 	

1
	

ARTICLE II

DEFINITIONAL PROVISIONS
	

Section 2.01	
 	

Definitions	
 	

1
	Section 2.02	 	Other Definitional Provisions; Determinations by Buyer	 	25
	

ARTICLE III

INITIATION; TERMINATION
	

Section 3.01	
 	

Conditions Precedent to Initial Transaction	
 	

25
	Section 3.02	 	Conditions Precedent to all Transactions	 	26
	Section 3.03	 	Transaction Mechanics; Related Matters	 	29
	Section 3.04	 	Repurchases	 	31
	Section 3.05	 	Facility Termination Date; Maximum Amount	 	32
	Section 3.06	 	Payment of Price Differential	 	32
	

ARTICLE IV

MARGIN MAINTENANCE
	

Section 4.01	
 	

Margin Adjustments	
 	

33
	Section 4.02	 	Margin Correction Deadline	 	33
	

ARTICLE V

INCOME PAYMENTS; REQUIREMENTS OF LAW
	

Section 5.01	
 	

Income Payments	
 	

33
	Section 5.02	 	Requirements of Law	 	34
	

ARTICLE VI

SECURITY INTEREST
	

Section 6.01	
 	

Security Interest	
 	

35
	Section 6.02	 	Release of Security Interest	 	36
	

ARTICLE VII

PAYMENT, TRANSFER AND CUSTODY
	

Section 7.01	
 	

Payment, Transfer and Custody	
 	

36

i

 

	

ARTICLE VIII

SELLER REPRESENTATIONS AND WARRANTIES
	

Section 8.01	
 	

Seller Representations and Warranties	
 	

37
	

ARTICLE IX

COVENANTS
	

Section 9.01	
 	

Seller Covenants	
 	

44
	

ARTICLE X

EVENTS OF DEFAULT; REMEDIES
	

Section 10.01	
 	

Events of Default	
 	

53
	Section 10.02	 	Remedies	 	56
	

ARTICLE XI

SERVICING
	

Section 11.01	
 	

Seller Covenants	
 	

58
	Section 11.02	 	Seller as Servicer	 	58
	Section 11.03	 	Third Party Servicer	 	58
	Section 11.04	 	Event of Default	 	58
	Section 11.05	 	Modification	 	59
	Section 11.06	 	Inspection	 	59
	

ARTICLE XII

MISCELLANEOUS
	

Section 12.01	
 	

Indemnification and Expenses	
 	

59
	Section 12.02	 	Single Agreement	 	60
	Section 12.03	 	Notices and Other Communications	 	61
	Section 12.04	 	Entire Agreement; Severability	 	61
	Section 12.05	 	Assignments and Participations; Hypothecation of Purchased Assets	 	61
	Section 12.06	 	Governing Law	 	62
	Section 12.07	 	Submission to Jurisdiction; Venue; Waiver of Jury Trial	 	62
	Section 12.08	 	Amendments; Waivers; Remedies Cumulative	 	63
	Section 12.09	 	Intent	 	64
	Section 12.10	 	Joint and Several Liability	 	64
	Section 12.11	 	Periodic Due Diligence Review	 	66
	Section 12.12	 	Buyer's Appointment as Attorney-in-Fact	 	66
	Section 12.13	 	Legal Matters	 	67
	Section 12.14	 	Confidentiality	 	68
	Section 12.15	 	Conflicts	 	68
	Section 12.16	 	Right of Set-off	 	68
	Section 12.17	 	Treatment of Certain Information	 	69
	Section 12.18	 	Increased Costs, Illegality, Etc	 	69

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	SCHEDULES

	 	 

	Schedule 1(a)	 	Representations and Warranties Re: Purchased Assets Consisting of Whole Loans
	Schedule 1(b)	 	Representations and Warranties Re: Purchased Assets Consisting of Junior Interests
	Schedule 1(c)	 	Representations and Warranties Re: Purchased Assets Consisting of Mezzanine Loans
	Schedule 1(d)	 	Representations and Warranties Re: Purchased Assets Consisting of Preferred Equity
	Schedule 1(e)	 	Representations and Warranties Re: Purchased Assets Consisting of CMBS
	Schedule 1(f)	 	Representations and Warranties Re: Purchased Assets Consisting of RMBS
	Schedule 1(g)	 	Representations and Warranties Re: Purchased Assets Consisting of Pass-Through Interests
	Schedule 2	 	Wiring Instructions
	Schedule 3	 	Controlled Accounts
	Schedule 4	 	Insurance
	Schedule 5	 	Subsidiaries
	

EXHIBITS

	
 	

 

	Exhibit A	 	Form of Transaction Request
	Exhibit B	 	Form of Confirmation
	Exhibit C	 	UCC Filing Jurisdictions
	Exhibit D	 	Form of Margin Deficit Notice
	Exhibit E	 	Form of Servicer Notice
	Exhibit F	 	Form of Custodial Agreement
	Exhibit G	 	Form of Account Control Agreement
	Exhibit H	 	Form of Release Letter(s)
	Exhibit I	 	Form of Libor Period Election Notice
	Exhibit J	 	Form of Compliance Certificate
	Exhibit K	 	Form of Purchased Asset Data Summary
	Exhibit L	 	Form of Pledge and Security Agreement
	Exhibit M	 	Form of Escrow Agreement
	Exhibit N	 	Form of Closing Letter
	Exhibit O	 	Form of Additional Seller Joinder Agreement

iii

 
 

ACQUISITION REPURCHASE AGREEMENT    
    

        ACQUISITION REPURCHASE AGREEMENT, dated as of July    , 2004 (as amended, restated, supplemented or otherwise modified and in effect from time to time,
this "Agreement"), by and among [BUYER] ("Buyer"), GRAMERCY CAPITAL CORP., a
Maryland corporation and GKK CAPITAL LP, a    limited partnership and the additional sellers from time to time parties hereto (the "Additional
Sellers", together with Gramercy Capital Corp. and GKK Capital LP, the "Seller"). 

 
 

ARTICLE I    
    
    APPLICABILITY    
    

        Section 1.01    Purchase and Sale.    Subject to the terms and conditions hereof, from time to time during the
Purchase Period (as defined below) Buyer may, upon request of Seller, enter into transactions (or a series of transactions) with Seller in which Seller transfers certain Mortgage Assets (as defined
below) to Buyer in a sales transaction against the transfer of funds by Buyer representing the purchase price for such Mortgage Assets, with a simultaneous agreement by Buyer to transfer to Seller
such Mortgage Assets in a repurchase transaction to occur on a date certain, which shall not be later than the Facility Termination Date (as defined below), against the transfer of funds by Seller
representing the repurchase price for such Mortgage Assets. Each such transaction shall be referred to herein as a "Transaction" and shall be governed
by this Agreement, unless otherwise agreed in writing. 

 
 

ARTICLE II    
    
    DEFINITIONAL PROVISIONS    
    

        Section 2.01    Definitions.    

        (a)   As
used herein, the following terms shall have the following meanings (all terms defined in this Section 2.01 or in other provisions of this Agreement in the
singular shall have the same meanings when used in the plural and vice versa). Terms otherwise not defined herein shall have the meanings assigned thereto in the Custodial Agreement.
"Accepted Servicing Practices": With respect to any Mortgage Asset, those mortgage servicing practices of prudent lending institutions which service
Mortgage Assets of the same type as such Mortgage Asset in the jurisdiction where the related Mortgaged Property is located. 

        "Account Control Agreement": An Account Control Agreement, substantially in the form attached as  Exhibit H hereto, among the Seller, Buyer and the Bank. 

        "Act of Insolvency": With respect to any Person, (i) the filing of a petition, commencing, or authorizing the commencement of any
case or proceeding under any bankruptcy, insolvency, reorganization, liquidation, dissolution or similar law relating to the protection of creditors, or suffering any such petition or proceeding to be
commenced by another which is consented to, not timely contested or results in entry of an order for relief; (ii) the seeking or consenting to the appointment of a receiver, trustee, custodian
or similar official for such Person or any substantial part of the property of such Person; (iii) the appointment of a receiver, conservator, or manager for such Person by any governmental
agency or authority having the jurisdiction to do so; (iv) the making of a general assignment for the benefit of creditors; (v) the admission by such Person of its inability to pay its
debts or discharge its obligations as they become due or mature; or (vi) that any governmental authority or agency or any person, agency or entity acting or purporting to act under governmental
authority shall have taken any action to condemn, seize or appropriate, or to assume custody or control of, all or any substantial part of the property of such Person, or shall have taken any action
to displace the management of such Person or to curtail its authority in the conduct of the business of such Person. 

        "Additional Sellers": The meaning assigned to such term in the introductory paragraph hereof. 

        "Affiliate": Any (A) entity that directly or indirectly owns, controls, or holds with power to vote, 20 percent or more of
the outstanding voting securities of the debtor, other than an entity that holds 

 

such
securities (i) in a fiduciary or agency capacity without sole discretionary power to vote such securities; or (ii) solely to secure a debt, if such entity has not in fact exercised
such power to vote; (B) corporation 20 percent or more of whose outstanding voting securities are directly or indirectly owned, controlled, or held with power to vote, by the debtor, or
by an entity that directly or indirectly owns, controls, or holds with power to vote, 20 percent or more of the outstanding voting securities of the debtor, other than an entity that holds such
securities (i) in a fiduciary or agency capacity without sole discretionary power to vote such securities; or (ii) solely to secure a debt, if such entity has not in fact exercised such
power to vote; (C) person whose business is operated under a lease or operating agreement by a debtor, or person substantially all of whose property is operated under an operating agreement
with the debtor; or (D) entity that operates the business or substantially all of the property of the debtor under a lease or operating agreement. 

        "Agreement": The meaning assigned thereto in the introductory paragraph hereof. 

        "ALTA": The American Land Title Association. 

        "Allocated Underlying Debt": With respect to an Underlying Mortgaged Property, any senior or pari
passu Indebtedness secured directly or indirectly by such Underlying Mortgaged Property, including, without limitation, any preferred equity interest or mezzanine debt that is
senior to, or pari passu with, the related Mortgage Asset in right of payment or priority. 

        "Alternate Base Rate": The meaning assigned to such term in the Fee Letter. 

        "Asset Schedule and Exception Report": The meaning assigned thereto in the Custodial Agreement. 

        "Asset Value": As of any date of determination for each Eligible Asset, with respect to a Mortgage Asset of a certain Class and the
applicable Type of Underlying Mortgaged Property, the least of (x) the product of the Book Value of such Mortgage Asset, plus or minus, in each case, the net value of any Interest Rate
Protection Agreement (to the extent the applicable Seller's interest in such Interest Rate Protection Agreement has been assigned to Buyer and so long as Buyer has a perfected first priority security
interest therein) in effect in respect of such Mortgage Asset times the Purchase Rate applicable thereto, (y) the product of the Market Value of
such Mortgage Asset, plus or minus, in each case, the net value of any Interest Rate Protection Agreement (to the extent the applicable Seller's interest in such Interest Rate Protection Agreement has
been assigned to Buyer and so long as Buyer has a perfected first priority security interest therein) in effect in respect of such Mortgage Asset times
the Purchase Rate applicable thereto and (z) if the LTV for an Underlying Mortgaged Property (including the principal amount of a Mortgage Asset) is greater than the Maximum LTV for such
Underlying Mortgaged Property, the product of (i) that portion of the principal amount of such Mortgage Asset, which when added to the Allocated Underlying Debt for such Underlying Mortgaged
Property, would result in an LTV for such Underlying Mortgaged Property that would equal the Maximum LTV for
such Mortgaged Property times (ii) the Purchase Rate applicable to such Mortgage Asset. As of each date of determination, the Purchase Rate shall
take into account all adjustments applicable thereto pursuant to the proviso set forth at the end of the definition thereof and the following additional limitations on Asset Value shall apply: 

        (a)   the
aggregate Asset Value of the Mortgage Assets shall be reduced to the extent that application of the Sub-Limit to the Underlying Properties securing
Mortgage Assets at any time results in breach of the Sub-Limit (such reduction to be determined by the Buyer by reference to the Mortgage Assets secured by the Underlying Properties that
give rise to breach of the Sub-Limit), unless waived in writing by Buyer in its sole and absolute discretion; and 

        (b)   unless
otherwise specifically agreed by Buyer in the related Confirmation, the Asset Value shall be deemed to be zero with respect to each Mortgage Asset (i) in
respect of which there is a material breach of a representation and warranty set forth in Schedule 1 (as applicable) which has not been cured by
Seller in accordance with the terms of this Agreement (and any applicable cure 

2

 

period
set forth in this Agreement has expired) or waived in writing by Buyer (assuming each representation and warranty is made as of the date the Asset Value is determined), (ii) with respect
to any Wet Mortgage Asset in respect of which the Mortgage Asset File (subject to the requirements of the Custodial Agreement) has not been delivered to the Custodian within five (5) Business
Days following the Purchase Date, (iii) which has been released from the possession of the Custodian under the Custodial Agreement to Seller for a period in excess of twenty
(20) calendar days, (iv) upon the occurrence of any Act of Insolvency with respect to any co-participant or any other Person having an interest in such Mortgage Asset or any
related Underlying Mortgaged Property which is senior to, in right of payment or priority the rights of Buyer in such Mortgage Asset and (v) which is determined by Buyer not to be an Eligible
Asset. 

Notwithstanding
any other provision herein, Seller agrees that to the extent Seller fails to deliver any reports required hereunder with respect to the Mortgage Asset and/or Underlying Mortgaged
Property, such failure will adversely affect the Asset Value of such Mortgage Asset, and to the extent that such failure to deliver reports causes Buyer to determine in its good faith that it is
unable to accurately determine the Asset Value of such Mortgage Asset, the Asset Value shall be deemed to be zero. 

        "Assignment of Leases": With respect to any Mortgage, an assignment of leases thereunder, notice of transfer or equivalent instrument in
recordable form, sufficient under the laws of the jurisdiction wherein the Underlying Mortgaged Property is located to reflect the assignment of leases. 

        "Assignment of Mortgage": With respect to any Mortgage, an assignment of the Mortgage, notice of transfer or equivalent instrument in
recordable form, sufficient under the laws of the jurisdiction
wherein the related Underlying Mortgaged Property is located to reflect the assignment of the Mortgage to Buyer. 

        "Bank": The meaning assigned thereto in the Account Control Agreement. 

        "Book Value": With respect to any Mortgage Asset at any time, an amount, as certified by the applicable Seller, equal to the lesser of
(x) the face or par amount of such Mortgage Asset and (y) the price which Seller paid for such Mortgage Asset plus any additional capital advanced by Seller in respect of such Mortgage
Asset, less, in either case, an amount equal to the sum of all principal paydowns paid in respect of such Mortgage Asset and realized losses or other
write downs recognized relating to such Mortgage Asset. 

        "Breakage Costs": The meaning assigned thereto in Section 3.06(b). 

        "Business Day": (i) For all purposes other than as covered by clause (ii) below, any day on which commercial banks are open
for business in New York and, solely with respect to the Custodial Agreement, Minnesota (or such other state where a successor custodian has its principal place of business), and (ii) with
respect to all notices and determinations in connection with, and payments of principal and interest on, any Transaction, the Pricing Rate applicable to which is based upon the Eurodollar Rate, any
day on which commercial banks are open in each of New York and London. 

        "Buyer": The meaning assigned thereto in the introductory paragraph hereof. 

        "Capitalized Lease Obligations": Obligations under a lease that are required to be capitalized for financial reporting purposes in
accordance with GAAP. The amount of a Capitalized Lease Obligation is the capitalized amount of such obligation as would be required to be reflected on the balance sheet prepared in accordance with
GAAP of the applicable Person as of the applicable date. 

        "Capital Stock": Any and all shares, interests, participations or other equivalents (however designated) of capital stock of a
corporation, any and all equivalent equity ownership interests in a Person which is not a corporation, including, without limitation, any and all member or other equivalent interests in any limited
liability company, and any and all warrants or options to purchase any of the foregoing. 

3

 

        "Change of Control": The occurrence of any of the following events: (a) prior to an internalization of management by Parent, if GKK
Manager LLC is no longer the manager of Parent, (b) after such time as Parent is internally managed, any "person" or "group" (within the meaning of Section 13(d) or 14(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act")) shall become, or obtain rights (whether by means of warrants, options or otherwise) to
become, the "beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of a percentage of the total voting power of all
classes of Capital Stock of the Parent entitled to vote generally in the election of directors of 20% or more; or (c) the Parent shall cease to own and control, of record and beneficially,
directly 100% of each class of outstanding Capital Stock of each Seller. Notwithstanding the foregoing, neither Buyer nor any other Person shall be deemed to approve or to have approved any
internalization of management as a result of this definition or any other provision herein. 

        "Class": With respect to a Mortgage Asset, such Mortgage Asset's classification as one of the following: Whole Loan, Junior Interest,
Mezzanine Loan, Preferred Equity, CMBS, RMBS, Distressed Debt or Pass-Through Interest. 

        "CMBS":
Pass-through certificates representing beneficial ownership interests in one or more first lien mortgage loans secured by commercial and/or multifamily properties. 

        "Code": The Internal Revenue Code of 1986, as amended from time to time, and the regulations promulgated and rulings issued thereunder. 

        "Collection Account": The account set forth on Schedule 3 established by Seller on behalf of Buyer and subject to an Account
Control Agreement, into which all Income shall be deposited. 

        "Confirmation": The meaning specified in Section 3.03(c). 

        "Consolidated Adjusted EBITDA": For any period, determined with respect to any Person(s) on a consolidated basis, an amount equal to the
sum of (a) net income (or loss) of such Person(s) for such period determined on a consolidated basis (prior to any impact from minority interests and before deduction of Preferred Dividends on
preferred stock, if any, of such Person(s)), in accordance with GAAP, plus the following (but only to the extent actually included in determination of such net income (or loss)):
(i) depreciation and amortization expense, (ii) interest expense, (iii) income tax expense and (iv) extraordinary or non-recurring gains and losses;  plus (b) each such Person's
pro rata share of Consolidated Adjusted EBITDA of its Unconsolidated Affiliates. Consolidated Adjusted EBITDA will be
adjusted to remove all impact of FIN 46 and FAS 140 to the extent of related transfers to special purpose entities in connection with bona fide securitizations of Mortgage Assets. 

        "Consolidated Interest Expense": For any period, determined without duplication with respect to any Person(s) on a consolidated basis, the
amount of total interest expense incurred (in accordance with GAAP), including capitalized or accruing interest (but excluding interest funded under a construction loan), plus each such Person's pro
rata share of Interest Expense from Joint Venture investments and Unconsolidated Affiliates. 

        "Consolidated Subsidiaries": Any Subsidiary of Parent, or any other entity, which is consolidated with Parent in accordance with GAAP or
which is required under GAAP to be consolidated with Parent. 

        "Consolidated Tangible Net Worth": As of a particular date, 

	(a)
	all
amounts which would be included under capital (or any like caption) on a consolidated balance sheet of any Person(s) at such date determined in accordance with GAAP,  less

	(b)
	(i) amounts
owing to such Person(s) from any Affiliates thereof (other than "arm's length" loans to SLG), or from officers, employees, partners, members, directors,
shareholders or other Persons similarly affiliated with such Person(s) or their respective Affiliates, 

4

 

(ii) intangible
assets [(other than Interest Rate Protection Agreements specifically related to the Purchased Assets)], (iii) prepaid taxes and/or expenses and
(iv) the value of any Mortgage Asset which, after its Purchase Date, becomes REO Property. 

        "Consolidated Total Assets": At any time, an amount equal to the aggregate book value of (a) all assets owned by any Person(s) (on
a consolidated basis) and (b) the proportionate share of assets owned by non-consolidated subsidiaries of such Person(s), less
(i) amounts owing to such Person(s) from any Affiliates thereof (other than "arm's length" loans to SLG), or from officers, employees, partners, members, directors, shareholders or other
Persons similarly affiliated with such Person(s) or their respective Affiliates, (ii) intangible assets [(other than Interest Rate Protection Agreements specifically related to the
Purchased Assets)] and (iii) prepaid taxes and/or expenses. 

        "Consolidated Total Indebtedness": At any time, without duplication, all amounts of Indebtedness and Contingent Liabilities of any
Person(s) and all Subsidiaries thereof determined on a consolidated basis, plus the pro rata share of Indebtedness and Contingent Liabilities of Unconsolidated Affiliates of such Person(s). 

        "Contingent Liabilities": Means with respect to any Person(s) and all Subsidiaries thereof (without duplication): (i) liabilities
and obligations (including any Guarantee Obligations) of such Persons in respect of "off-balance sheet arrangements" (as defined in the SEC Off-Balance Sheet Rules) which would
be required to be, or customarily would be, disclosed in the "Management's Discussion and Analysis of Financial Condition and Results of Operations" section of a Form 10-Q or
Form 10-K (or their equivalents) which any such Person (or any Affiliate thereof) is required to file with the Securities and Exchange Commission (or any Governmental Authority
substituted therefore) other than bona fide securitization transactions which fall into this category solely as a result of the application of FAS 140 or FIN 46, (ii) any obligation
(including, without limitation, any Guarantee Obligation) whether or not required to be disclosed in the footnotes to any such Person's financial statements, guaranteeing partially or in whole any
Non-Recourse Indebtedness, lease, dividend or other obligation, exclusive of contractual indemnities (including, without limitation, any indemnity or price-adjustment provision relating to
the purchase or sale of securities or other assets) and guarantees of non-monetary obligations (other than guarantees of completion, environmental indemnities and guarantees of customary
carve-out matters made in connection with Non-Recourse Indebtedness, such as fraud, misappropriation, bankruptcy and misapplication) which have not yet been called on or
quantified, of such Person or of any other Person, and (iii) any forward commitment or obligation to fund or provide proceeds with respect to any loan or other financing which is obligatory and
non-discretionary on the part of the lender. The amount of any Contingent Liabilities described in clause (ii) shall be deemed to be (a) with respect to a guarantee of
interest or interest and principal, or operating income guarantee, the sum of all payments required to be made thereunder (which in the case of an operating income guarantee shall be deemed to be
equal to the debt service for the note secured thereby, through (x) in the case of an interest or interest and principal guarantee, the stated date of maturity of the obligation (and commencing
on the date interest could first be payable thereunder), or (y) in the case of an operating income guarantee, the date through which such guarantee will remain in effect, and (b) with
respect to all guarantees not covered by the preceding clause (a), an amount equal to the stated or determinable amount of the primary obligation in respect of which such guarantee is made or,
if not stated or determinable, the maximum reasonably anticipated liability in respect thereof (assuming such Person is required to perform thereunder) as recorded on the balance sheet and on the
footnotes to the most recent financial statements of such Person. As used in this definition, the term "SEC Off-Balance Sheet Rules" means the Disclosure in Management's Discussion and
Analysis About Off Balance Sheet Arrangements, Securities Act Release No. 33-8182, 68 Fed. Reg. 5982 (Feb. 5, 2003) (codified at 17 CFR pts. 228, 229 and 249). 

5

 

        "Contractual Obligation": as to any Person, any provision of any security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its property is bound. 

        "Controlled Accounts": A collective reference to the Collection Account and the Operating Account. 

        "Custodial Agreement": A custodial agreement, substantially in the form attached as  Exhibit G hereto, by and among the Seller, Buyer and the Custodian, as the same
may be amended, restated, supplemented or otherwise modified and
in effect from time to time. 

        "Custodian": Wells Fargo Bank, N.A. and its successors in interest, as custodian under the Custodial Agreement, and any successor
Custodian under the Custodial Agreement. 

        "Debt Service Coverage Ratio" or "DSCR": With respect to any Mortgage Asset, as of any
date of determination, each of (a) the In Place DSCR and (b) the Stabilized DSCR of such Mortgage Asset at such time. 

        "Distressed Debt": Sub-performing or non-performing Whole Loans secured by commercial or multifamily real estate. 

        "Dry Funding": A Transaction for which a complete Mortgage Asset File, in accordance with the terms of this Agreement and the Custodial
Agreement, has been delivered for each Mortgage Asset to the Custodian prior to the related Purchase Date. 

        "Dry Mortgage Asset": A Mortgage Asset for which a complete Mortgage Asset File, in accordance with the terms of this Agreement and the
Custodial Agreement, has been delivered to the Custodian prior to related Purchase Date. 

        "Default": Any of the events specified in Section 10.01, whether or not any requirement for the giving of notice, the lapse of
time, or both, or any other condition, has been satisfied. 

        "Defaulted Mortgage Asset": Any Mortgage Asset (a) which is sixty (60) days or more delinquent in the payment of principal,
interest, fees or other amounts payable under the terms of the related Mortgage Asset documents (including, without limitation, any Preferred Equity which has not been current pay during such period),
(b) for which there is a material breach of the representations and warranties set forth on Schedules 1(a)–1(g), as
applicable, hereto having a Material Adverse Effect on such Mortgage Asset, or (c) for which there is a non-monetary default under the related Mortgage Asset documents. 

        "Delinquent Mortgage Asset": A Mortgage Asset which is thirty (30) or more days, but less than sixty (60) days, delinquent
in the payment of principal, interest, fees or other amounts payable under the terms of the related Mortgage Asset documents (including, without limitation, any Preferred Equity which has not been
current pay during such period). 

        "Derivatives Contract": Any and all rate swap transactions, basis swaps, credit derivative transactions, forward rate transactions,
commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward bond price or
forward bond index transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions, cross-currency
rate swap transactions, currency options, spot contracts, or any other similar transactions or any combination of any of the foregoing (including any options to enter into any of the foregoing),
whether or not any such transaction is governed by or subject to any master agreement. Not in limitation of the foregoing, the term "Derivatives Contract" includes any and all transactions of any
kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives 

6

 

Association, Inc.,
any International Foreign Exchange Master Agreement, or any other master agreement, including any such obligations or liabilities under any such master agreement. 

        "Derivatives Termination Value": With respect to any Derivatives Contract, after taking into account the effect of any legally enforceable
netting agreement relating to such Derivatives Contract, (a) for any date on or after the date such Derivatives Contract has been closed out and termination value(s) determined in accordance
therewith, such termination value(s), and (b) for any date prior to the date referenced in clause (a) the amount(s) determined as the mark-to-market value(s) for
such Derivatives Contract, as determined based upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Derivatives Contract (which may
include Buyer). 

        "Dollars" and "$": Freely transferable lawful money of the United States of America. 

        "Due Diligence Review": The performance by Buyer of any or all of the reviews permitted under Section 12.11 with respect to any or
all of the Mortgage Assets, as reasonably desired by Buyer from time to time. 

        "Effective Date": The first date upon which all of the conditions precedent set forth in Section 3.01 shall have been satisfied. 

        "Election Notice": An irrevocable notice substantially in the form of Exhibit J hereto specifying the Eurodollar Period which the
applicable Seller has selected in respect of any Transaction. 

        "Electronic Transmission": The delivery of information in an electronic format acceptable to the applicable recipient thereof. 

        "Eligible Asset": A Mortgage Asset which as of any date of determination: 

        (a)   is
not a Defaulted Mortgage Asset or Delinquent Mortgage Asset; 

        (b)   is
not a construction loan or a construction note of any sort (which shall not, in and of itself, preclude Mortgage Assets that include renovation, rehabilitation or
expansion components which will be completed within twelve (12) months of the related Purchase Date); 

        (c)   has
been approved by Buyer in its sole discretion; 

        (d)   has
been acquired by either Parent or a special purpose entity which is a subsidiary of Parent and which is a Seller under this Agreement; 

        (e)   except
with respect to RMBS and CMBS, Buyer has received an appraisal meeting the standards of FIRREA and stating that the LTV of the related Underlying Mortgaged
Property is not greater than 78% (except with respect to hotels, in which case the related LTV shall not be greater than 60%); 

        (f)    is
not a Wet Mortgage Asset for which the Mortgage Asset File has not been delivered in accordance with the terms of this Agreement and the Custodial Agreement within
five (5) Business Days after the Purchase Date; and 

        (g)   in
the case of a Whole Loan, is evidenced by an original Mortgage Note; 

provided, that (i) "Eligible Asset" shall not include any Mortgage Asset consisting of Preferred Equity or a first loss debt instrument (other
than CMBS) which represents (a) less than 5.0% of the total debt capitalization of the related Underlying Mortgaged Property or (b) more than 15% of the equity capitalization of the
related Underlying Mortgaged Property, (ii) notwithstanding the foregoing and any Mortgage Asset's failure to conform to any of the criteria set forth above, Buyer may, in its sole discretion,
designate in writing any such non-compliant Mortgage Asset an Eligible Asset and (iii) in the case of Mortgage Assets consisting of Preferred Equity and Distressed Debt, Buyer
reserves the 

7

 

right
to require that such Mortgage Assets be held in a separate Special Purpose Entity in order to be included as Eligible Assets. 

        "Environmental Law": Any federal, state, foreign or local statute, law, rule, regulation, ordinance, code, guideline, written policy and
rule of common law now or hereafter in effect and in each case as amended, and any judicial or administrative interpretation thereof, including any judicial or administrative order, consent decree or
judgment, relating to the environment, employee health and safety or Hazardous Materials, including, without limitation, CERCLA; RCRA; the Federal Water Pollution Control Act, 33 U.S.C. §
1251 et seq.; the Toxic Substances Control Act, 15 U.S.C. § 2601 et seq.; the Clean Air Act,
42 U.S.C. § 7401 et seq.; the Safe Drinking Water Act, 42 U.S.C. § 3803 et seq.; the Oil Pollution Act of 1990, 33 U.S.C.
§ 2701 et seq.; the Emergency Planning and the Community Right-to-Know Act of 1986, 42 U.S.C. § 11001  et seq.; the Hazardous Material
Transportation Act, 49 U.S.C. § 1801 et seq. and the
Occupational Safety and Health Act, 29 U.S.C. § 651 et seq.; and any state and local or foreign counterparts or equivalents, in each case as
amended from time to time. 

        "Equity Interest": With respect to any Person, any share of capital stock of (or other ownership or profit interests in) such Person, any
warrant, option or other right for the purchase or other acquisition from such Person of any share of capital stock of (or other ownership or profit interests in) such Person, any security convertible
into or exchangeable for any share of capital stock of (or other ownership or profit interests in) such Person or warrant, right or option for the purchase or other acquisition from such Person of
such shares (or such other interests), and any other ownership or profit interest in such Person (including, without limitation, partnership, member or trust interests therein), whether voting or
nonvoting, and whether or not such share, warrant, option, right or other interest is authorized or otherwise existing on any date of determination. 

        "ERISA": The Employee Retirement Income Security Act of 1974, as amended from time to time, and the regulations promulgated and rulings
issued thereunder. Section references to ERISA are to ERISA, as in effect at the date of this Agreement, and to any subsequent provisions of ERISA, amendatory thereof, supplemental thereto or
substituted therefor. 

        "ERISA Affiliate": Any person (as defined in Section 3(g) of ERISA which, together with the Borrower would be deemed to be a
"single employer" within the meaning of Section 414(b), (c), (m) or (o) of the Code. 

        "Equity Interest": With respect to any Person, any share of capital stock of (or other ownership or profit interests in) such Person, any
warrant, option or other right for the purchase or other acquisition from such Person of any share of capital stock of (or other ownership or profit interest in) such Person, any security convertible
into or exchangeable for any share of capital stock of (or other ownership or profit interests in) such Person or warrant, right or option for the purchase or other acquisition from such Person of
such shares (or such other interests), and any other ownership or profit interest in such Person (including, without limitation, partnership, member or trust interests therein), whether voting or
nonvoting, and whether or not such share, warrant, option, right or other interest is authorized or otherwise existing on any date of determination. 

        "Equity Issuance": Any issuance by a Person of any Equity Interest, which shall in any event include the issuance of any Equity Interest
upon the conversion or exchange of any security constituting Indebtedness that is convertible or exchangeable, or is being converted or exchanged, for Equity Interests. 

        "Escrow Instruction Letter": The meaning assigned thereto in the Custodial Agreement. 

        "Eurodollar Period": With respect to any Transaction, (i) initially, the period commencing on the Purchase Date with respect to
such Transaction and ending on the earlier of the related Repurchase Date and the first Payment Date after such Purchase Date, and (ii) thereafter, each period commencing on the last day of the
preceding Eurodollar Period applicable to such Transaction and 

8

 

ending
on the earliest of (x) the related Repurchase Date, (y) the Payment Date that is one-month, two-months, three-months or six-months thereafter,
in each case as specified by Seller in an Election Notice delivered to Buyer not less than three (3) Business Days prior to the last day of then-current Eurodollar Period with
respect thereto; provided, that Seller may not select a Eurodollar Period longer than one-month if the last day of such Eurodollar Period
occurs after the Facility Termination Date and, in the event that the Buyer has not received an Election Notice by the date which is three (3) Business days prior to the last day of
then-current Eurodollar Period with respect thereto, the applicable Seller shall be deemed to have selected a one-month Eurodollar Period, or (z) the Facility
Termination Date. In no event may Seller elect a Eurodollar period which would extend beyond the applicable Maturity Date of either this Agreement or the Liquidity Facility and, unless Buyer and Banks
(as such term is defined in the Liquidity Facility) otherwise agree, in no event may there be more than five (5) different interest periods for Eurodollar Rate transactions under either this
Agreement and the Liquidity Facility at any one time. Any portion of this Agreement subject to an election pursuant to this definition for any particular interest period shall be in the minimum
aggregate amount of $1,000,000 and in multiples of $1,000,000. 

        "Eurodollar Rate": With respect to any outstanding Transaction, the rate per annum equal to the rate for deposits in Dollars for a period
equal to the applicable Eurodollar Period which appears on page 3750 of the Telerate Screen at or about 9:00 a.m., New York City time, three (3) Business Days prior to the beginning of
such Eurodollar Period (and if such date is not a Business Day, the Eurodollar Rate in effect on the Business Day immediately preceding such date), and if such rate shall not be so quoted, the average
rate per annum at which three (3) mutually acceptable banks are offered Dollar deposits at or about 8:00 a.m., New York City time, on such date by prime banks in the interbank eurodollar
market where the eurodollar and foreign currency exchange operations in respect of its Transactions are then being conducted for delivery on such day for a period of thirty (30) days and in an
amount comparable to the amount of the Transactions to be outstanding on such day. The Eurodollar Rate shall be reset by Buyer as described above and Buyer's determination of Eurodollar Rate shall be
conclusive upon the parties absent manifest error on the part of Buyer. 

        "Event of Default": The meaning specified in Section 10.01. 

        "Facility Termination Date": the Initial Termination Date, or such later date as may by in effect pursuant to Section 3.05(a)
hereof, or such earlier date on which any of this Agreement, the Liquidity Facility or the Master Repo Facility shall terminate in accordance with the provisions of such facility or by operation of
law. 

        "Federal Funds Rate": Shall mean for any day, the rate per annum (rounded upwards, if necessary, to the nearest 1/1000 of 1%) equal to the
weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank
of New York on such day; provided that (a) if such day is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as
so published on the next succeeding Business Day, and (b) if no such rate is so published on such Business Day, the Federal Funds Rate for such day shall be the average of the quotations for
such day for such transactions received by Wachovia Bank, National Association from three Federal funds brokers of recognized standing and reputation reasonably selected by Wachovia Bank, National
Association. 

        "Fee Letter": That certain Fee Letter, dated July [    ], 2004, among the Seller and Buyer, as the same
may be amended, supplemented or otherwise modified from time to time. 

        "Funds From Operation" or "FFO": For a given period, (a) Net Income of the REIT and
its Subsidiaries for such period (before extraordinary and non-recurring items), minus (or plus) (b) gains (or losses) from debt restructuring and sales of property during such
period, plus (c) depreciation and amortization of real and personal property assets for such period, plus (d) without duplication, income 

9

 

from
unconsolidated partnerships and joint ventures, determined in each case in accordance with GAAP. 

        "FHLMC": Federal Home Loan Mortgage Corporation, or any successor thereto. 

        "Final Purchase Date": The earlier of (a) July [    ], 2007;  provided, that upon written request of all of the Seller delivered to Buyer (which
request shall be unconditional and irrevocable) no earlier than one
hundred twenty (120) days and no later than ninety (90) days prior to such date, and so long as on such date no event which has a Material Adverse Effect and no Default or Event of
Default, or any default under any other Repurchase Document, shall have occurred and then be continuing, Buyer may in its sole discretion agree to extend the Final Purchase Date, for a period not to
exceed 364 days, by giving written notice to Seller of such extension and of the new Final Purchase Date determined by Buyer; provided, that any failure by Buyer to deliver any such notice of
extension to Seller shall be deemed to be Buyer's determination not to extend the Final Purchase Date and (b) the Facility Termination Date. 

        "Fixed Charge Coverage Ratio": For any Person during any period, the Adjusted EBITDA for such period divided by the Fixed Charges for the
same period. 

        "Fixed Charges": For any Person during any period, the sum of (a) Debt Service, (b) all Preferred Dividends,
(c) Capitalized Lease Obligations paid or accrued during such period, (d) Capital Expenditures (if any) and (e) any amounts payable under any Ground Lease. Fixed Charges shall
include a proportionate share of items (a), (b), (c), (d) and (e) of all Unconsolidated Affiliates. 

        "FNMA": Federal National Mortgage Association, or any successor thereto. 

        "Foreclosed Loan": A Mortgage Asset with respect to which the Underlying Mortgaged Property has been foreclosed upon by the applicable
Seller. 

        "GAAP": Generally accepted accounting principles as in effect from time to time in the United States. 

        "GNMA": Government National Mortgage Association, or any successor thereto. 

        "Governing Documents": As to any Person, its articles or certificate of incorporation and by-laws, its partnership agreement,
its certificate of formation and operating agreement, and/or the other organizational or governing documents of such Person. 

        "Governmental Authority": Any government (or any political subdivision or jurisdiction thereof), court, bureau, agency or other
governmental authority having jurisdiction over the Borrower, the Administrative Agent or any Bank, as applicable, or any of their respective businesses, operations or properties. 

        "Ground Lease": A ground lease containing the following terms and conditions: (a) a remaining term (exclusive of any unexercised
extension options) of thirty (30) years or more from the Purchase Date of the Mortgage Asset; (b) the right of the lessee to mortgage and encumber its interest in the leased property
without the consent of the lessor or with such consent given; (c) the obligation of the lessor to give the holder of any mortgage lien on such leased property written notice of any defaults on
the part of the lessee and agreement of such lessor that such lease will not be terminated until such holder has had a reasonable opportunity to cure or complete foreclosures, and fails to do so;
(d) reasonable transferability of the lessee's interest under such lease, including ability to sublease; and (e) such other rights customarily required by mortgagees making a loan
secured by the interest of the holder of the leasehold estate demised pursuant to a ground lease. 

        "Ground Lease Asset": A Mortgage Asset the Underlying Mortgaged Property for which is secured or supported in whole or in part by a Ground
Lease. 

10

 

        "Guarantee": As to any Person, any obligation of such Person directly or indirectly guaranteeing any Indebtedness of any other Person or
in any manner providing for the payment of any Indebtedness of any other Person or otherwise protecting the holder of such Indebtedness against loss (whether by virtue of partnership arrangements, by
agreement to keep-well another Person, to purchase assets, goods, securities or services, or to agree to take-or-pay arrangement or otherwise). The amount of any
Guarantee of a Person shall be deemed to be an amount equal to the stated or determinable amount of the primary obligation in respect of which such Guarantee is made or, if not stated or determinable,
the maximum reasonably anticipated liability in respect thereof as determined by such Person in good faith. The terms "Guarantee" and "Guaranteed" used as verbs shall have correlative meanings. 

        "Guarantee Obligation": As to any Person (the "guaranteeing person"), without duplication, any obligation of (a) the guaranteeing
person or (b) another Person (including, without limitation, any bank under any letter of credit) to induce the creation of an obligation for which the guaranteeing person has issued a
reimbursement, counterindemnity or similar obligation, in either case guaranteeing or in effect guaranteeing any Indebtedness, leases, dividends or other obligations (the "primary obligations") of any
other third Person (the "primary obligor") in any manner, whether directly or indirectly, including, without limitation, any obligation of the guaranteeing person, whether or not contingent,
(i) to purchase any such primary obligation or any property constituting direct or indirect security therefor, (ii) to advance or supply funds (1) for the purchase or payment of
any such primary obligation or (2) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor,
(iii) to purchase property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such
primary obligation or (iv) otherwise to assure or hold harmless the owner of any such primary obligation against loss in respect thereof; provided, however, that the term Guarantee Obligation
shall not include endorsements of instruments for deposit or collection in the ordinary course of business. The terms "Guarantee" and "Guaranteed" used as a verb shall have a correlative meaning. 

        ["In Place DSCR": With respect to any Mortgage Asset, as of any date of determination, the ratio of (x) (i) Net Cash
Flow plus (ii) debt service reserves actually held back or funded into Seller controlled accounts subject to the Seller's exclusive dominion and control, plus (iii) at Buyer's sole
discretion, third party credit enhancements, to (y) the debt service on the Mortgage Asset calculated using (i) the greater of (A) the required amortization for the first
12 months of the remaining term of the Mortgage Asset or (B) hypothetical 30-year amortization schedule for the first 12 months of the remaining term of the Mortgage
Asset, and (ii) an interest rate equal to the actual interest rate (in the case of a fixed interest rate Eligible Asset) or the lesser of (i) the highest applicable strike price of any
LIBOR cap contract for such 12-month period (plus the spread) or (ii) the average interest rate for such 12 month period using the applicable "forward LIBOR curve", plus 50
basis points over the spread.] 

        "Income": With respect to any Mortgage Asset at any time, all collections and proceeds on or in respect of the Mortgage Assets, including,
without limitation, any principal thereof then payable and all interest or other distributions payable thereon less any related servicing fee(s) charged by Servicer. 

        "Indebtedness": For any Person, at the time of computation thereof, all of the following (without duplication): (a) all obligations
of such Person in respect of money borrowed (including without limitation principal, interest, assumption fees, prepayment fees, contingent interest, and other monetary obligations whether choate or
inchoate); (b) all obligations of such Person, whether or not for money borrowed (i) represented by notes payable, letters of credit, or drafts accepted, in each case representing
extensions of credit, (ii) evidenced by bonds, debentures, notes or similar instruments, or (iii) constituting purchase money indebtedness, conditional sales contracts, title retention
debt instruments or other similar instruments, upon which interest charges are customarily paid or that are issued or assumed as full or partial payment for property or services rendered;
(c) Capitalized Lease 

11

 

Obligations
of such Person; (d) all reimbursement obligations of such Person under any letters of credit or acceptances (whether or not the same have been presented for payment); (e) all
"off-balance sheet arrangements" of such Person other than bona fide securitization transactions; (f) all obligations of such Person to purchase, redeem, retire, defease or
otherwise make any payment in respect of any Mandatory Redeemable Stock issued by such Person or any other Person (inclusive of forward equity contracts), valued at the greater of its voluntary or
involuntary liquidation preference plus accrued and unpaid dividends; (g) all obligations of such Person in respect of any keep well arrangements, credit enhancements, contingent or future
funding obligations under any Purchased Asset or any obligation senior to the Purchased Asset, unfunded interest reserve amount under any Purchased Asset or any obligation that is senior to the
Purchased Asset, purchase obligation, repurchase obligation, takeout commitment or forward equity commitment, in each case evidenced by a binding agreement (excluding any such obligation to the extent
the obligation can be satisfied by the issuance of Equity Interests (other than Mandatory Redeemable Stock)); (h) net obligations under any Derivative Contract not entered into as a hedge
against existing Indebtedness, in an amount equal to the Derivatives Termination Value thereof; (i) all Indebtedness of other Persons which such Person has Guaranteed or is otherwise recourse
to such Person (except for guaranties of customary exceptions for fraud, misapplication of funds, environmental indemnities and other similar exceptions to recourse liability (but not exceptions
relating to bankruptcy, insolvency, receivership or other similar events)); (j) all Indebtedness of another Person secured by (or for which the holder of such Indebtedness has an existing
right, contingent or otherwise, to be secured by) any Lien on property or assets owned by such Person, even though such Person has not assumed or become liable for the payment of such Indebtedness or
other payment obligation; and (k) such Person's pro rata share of the Indebtedness of any Unconsolidated Affiliate of such Person. 

        "Independent Director" or "Independent Manager": With respect to any Additional Sellers, a
natural Person who is not at the time of initial appointment as an Independent Director or Independent Manager, and may not have been at any time during the five (5) years preceding such
initial appointment or at any time while serving as Independent Director or Independent Manager, (i) a director (other than Independent Director of Seller), manager (other than Independent
Manager of Seller), officer, trustee, employee, partner, member, attorney or counsel of Seller or any of its Affiliates; (ii) a creditor, customer, supplier or other person who derives any of
its purchases or revenues from its activities with Seller or any of its Affiliates; (iii) a natual Person controlling or under common control with any Person that would be excluded from serving
as an Independent Director or Independent Manager under (i) or (ii), above; or (iv) a member of the immediate family of a natural Person excluded from serving as an Independent Director
or Independent Manager under (i) or (ii), above. 

        "Initial Termination Date": July [    ], 2006. 

        "Interest Coverage Ratio": As to any Person for any period, the ratio of (a) the Adjusted EBITDA of such Person to (b) the
Interest Expense of such Person with respect to the same period. 

        "Interest Expense" Any Person's total interest expense incurred (in accordance with GAAP), including capitalized or accruing interest (but
excluding interest funded under a construction loan), on a consolidated basis plus the Person's pro rata share of Interest Expense from Joint Venture Investments and Unconsolidated Affiliates, without
duplication for the most recent period. 

        "Interest Rate Protection Agreement": With respect to any or all of the Purchased Assets, any futures contract, options related contract,
short sale of US Treasury securities or any interest rate swap, cap, floor or collar agreement or any other similar arrangement providing for protection against fluctuations in interest rates or the
exchange of nominal interest obligations, either generally or under specific contingencies and acceptable to Buyer. 

12

 

        "Investment": With respect to any Person, any acquisition or investment (whether or not of a controlling interest) by such Person, whether
by means of (a) the purchase or other acquisition of any Equity Interest in another Person, (b) a loan, advance or extension of credit to, capital contribution to, guaranty or credit
enhancement of Indebtedness of, or purchase or other acquisition of any Indebtedness of, another Person, including any partnership or joint venture interest in such other Person, or (c) the
purchase or other acquisition (in one transaction or a series of transactions) of assets of another Person that constitute the business or a division or operating unit of another Person. Any binding
commitment or option to make an Investment in any other Person shall constitute an Investment. Except as expressly provided otherwise, for purposes of determining compliance with any covenant
contained in any Wachovia Facility document, the amount of any Investment shall be the amount actually invested, without adjustment for subsequent increases or decreases in the value of such
Investment. 

        "IPO": The meaning specified in the Liquidity Facility 

        "Joint Venture": The meaning specified in the Liquidity Facility. 

        "Junior Interest": (a) A junior participation interest in a performing commercial real estate loan or (b) a
"B-note" in an "A/B structure" in a performing commercial real estate loan, for which the combined DSCR is not less than that set forth in the related Confirmation, taking into account, in
the calculation of the LTV and the DSCR of such Junior Interest, any senior or pari passu Indebtedness secured directly or indirectly by the applicable
Underlying Mortgaged Property (including, if applicable, any Preferred Equity). 

        "Junior Interest Note": The original executed promissory note, certificate (whether participation or otherwise) or other tangible evidence
of a Junior Interest. 

        "Late Payment Fee": The meaning specified in Section 3.06(a). 

        "Lien": Any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), preference, priority
or other security agreement of any kind or nature whatsoever (including, without limitation, any conditional sale or other title retention agreement, any financing or similar statement or notice filed
under the UCC or any other similar recording or notice statute, and any lease having substantially the same effect as any of the foregoing). 

        "Liquidity Facility": That certain Credit Agreement, dated as of July [    ], 2004, among Gramercy
Capital Corp. and its operating partnership, as borrowers, the financial institutions from time to time parties thereto, [    ], as administrative agent, and Wachovia
Capital Markets, LLC, as sole lead arranger and sole book manager, as the same may be amended, restated, supplemented or otherwise modified and in effect from time to time. 

        "Loan-to-Value Ratio" or
"LTV": With respect to any Mortgage Asset, at the time of determination, the ratio of (a) the outstanding principal amount of such Mortgage Asset
at such time plus the amount of any Allocated Underlying Debt for such Mortgage Asset at such time to (b) the lesser of (i) the appraised value of the related Underlying Mortgaged
Property, as determined by reference to the third-party appraisal, meeting the standards required by FIRREA, of such Underlying Mortgaged Property, with such appraised value being subject to
adjustment by Buyer in its sole discretion, and (ii) the purchase price of such Underlying Mortgaged Property. 

        "Management Contract": That certain Management Contract, dated as of July [    ], 2004, between
[    ] and [    ], as the same may be amended, restated, supplemented or otherwise modified and in effect from time to time. 

        "Manager": The meaning assigned thereto in the Management Contract. 

13

 

        "Mandatory Redeemable Stock": With respect to any Seller or any Subsidiary thereof, any Equity Interest of such Person which by the terms
of such Equity Interest (or by the terms of any security into which it is convertible or for which it is exchangeable or exercisable), upon the happening of any event or otherwise (a) matures
or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise (other than an Equity Interest to the extent redeemable in exchange for common stock or other equivalent common Equity
Interests), (b) is convertible into or exchangeable or exercisable for Indebtedness or Mandatory Redeemable Stock, or (c) is redeemable at the option of the holder thereof, in whole or
in part (other than an Equity Interest which is redeemable solely in exchange for common stock or other equivalent common Equity Interests); in each case, on or prior to the Facility Termination Date
or the Maturity Date of this Agreement or the Liquidity Facility. 

        "Margin Correction Deadline": The time, determined in accordance with Section 4.02 of this Agreement, as the time by which all
transfers, repurchases and payments elected to be made by Seller pursuant to a Margin Deficit Notice shall be completed. 

        "Margin Deficit": At any time and with respect to any Mortgage Asset subject to a Transaction then outstanding, the amount, if any, by
which (a) the Repurchase Price for such Mortgage Asset exceeds the Asset Value of such Mortgage Asset (the value of any applicable Interest Rate Protection Agreements shall be taken into
account when making any such calculations) or (b) the aggregate Repurchase Price of all Mortgage Assets subject to Transactions then outstanding exceeds the Maximum Amount. 

        "Margin Deficit Notice": A written notice, substantially in the form attached as  Exhibit E hereto, which requires Seller to correct a Margin Deficit in accordance
with Article IV of this Agreement. 

        "Margin Stock": The meaning provided in Regulations U and X of the Board of Governors of the Federal Reserve System. 

14

  

        "Market Value": As of any date in respect of any Mortgage Asset, the price at which such Mortgage Asset could readily be sold (which price
shall in no event be greater than the outstanding principal amount (or equivalent term for "par" for Mortgage Assets with no principal amount) of such Mortgage Asset), as determined by Buyer in its
sole discretion exercised in good faith by (i) reference to the market value of the Underlying Mortgaged Property, which shall be determined by a third-party appraisal of the Underlying
Mortgaged Property (which appraisal may, at the election of Buyer, be the appraisal in place at the time such Mortgage Asset is sold to the Buyer hereunder), as such determination of the market value
of the Underlying Mortgaged Property may be adjusted by Buyer in its sole discretion exercised in good faith, and (ii) taking into account such other criteria as Buyer deems appropriate in its
good faith, including, without limitation, current market conditions (including, without limitation, current interest rates and spreads), credit quality, liquidity of position, eligibility for CDO
execution, subordination, delinquency status and aging, which price, in each case, may be determined to be zero. 

        "Master Repo Facility" that certain $250,000,000 revolving credit facility evidenced by that certain Master Repurchase Agreement dated of
even date herewith, by and among [BUYER], [SELLER] and [ADDITIONAL SELLER]. 

        "Material Adverse Effect": A material adverse effect on (a) the Property, business, operations, financial condition or prospects of
Seller, (b) the ability of Seller to perform its obligations under any of the Repurchase Documents to which it is a party, (c) the validity or enforceability of any of the Repurchase
Documents, (d) the rights and remedies of Buyer under any of the Repurchase Documents, (e) the timely payment of any amounts payable under the Repurchase Documents, or (f) the
Asset Value, rating (if applicable) or liquidity of any or all of the Purchased Assets. 

        "Materials of Environmental Concern": Any toxic mold, any petroleum (including, without limitation, crude oil or any fraction thereof) or
petroleum products (including, without limitation, gasoline) or any hazardous or toxic substances, materials or wastes, defined as such in or regulated under any Environmental Law, including, without
limitation, asbestos, polychlorinated biphenyls, and urea-formaldehyde insulation. 

        "Maturity Date": The earlier of (i) July     , 2006, as such date may be extended pursuant to
Section 3.05(a) hereof, subject in any event to acceleration pursuant to Section 10.02 hereof, and (ii) the maturity or earlier acceleration of the Master Repo Facility and/or the
Liquidity Facility. 

        "Maximum Amount": $50,000,000 or such greater amount as Buyer may determine in accordance with Section 3.05(b) hereof. 

        "Maximum LTV": With respect to any Purchased Asset at any time, the Loan-to-Value Ratio for the related Underlying
Mortgaged Property set forth in the related Confirmation under the heading "Maximum LTV" and for the Class and Type of such Mortgage Asset. 

        "Mezzanine Loan": A performing mezzanine loan secured by pledges of all the Capital Stock of a Mortgagor [or that portion of
the Capital Stock that includes the general partnership, managing member or other controlling interest (including, without limitation, the sole right to take title to and sell the related Underlying
Mortgaged Property)] that owns income producing commercial real estate which is a Type of Mortgaged Property and for which the combined DSCR is not less than that set forth in the related
Confirmation, taking into account, in the calculation of the LTV and the DSCR of such Mezzanine Loan, any senior Indebtedness secured directly or indirectly by the applicable Underlying Mortgaged
Property, including, without limitation, any preferred equity interest or mezzanine debt that is senior to the related Mortgage Asset in right of payment or priority. 

        "Mezzanine Note": The original executed promissory note, certificate or other tangible evidence of Mezzanine Loan indebtedness. 

15

 

        "Mortgage": Each mortgage, assignment of rents, security agreement and fixture filing, or deed of trust, assignment of rents, security
agreement and fixture filing, or similar instrument creating and evidencing a lien on real property and other property and rights incidental thereto. 

        "Mortgage Asset": Any Whole Loan, Junior Interest, Mezzanine Loan, Preferred Equity, CMBS, RMBS, Distresssed Debt or
Pass-Through Interest (i) the Underlying Mortgaged Property for which is included in the categories for Types of Mortgaged Property, and (ii) which the Custodian has been
instructed to hold for Buyer pursuant to the Custodial Agreement listed on a Confirmation. 

        "Mortgage Asset Documents": The meaning assigned thereto in the Custodial Agreement. 

        "Mortgage Asset File": The meaning assigned thereto in the Custodial Agreement. 

        "Mortgage Note": The original executed promissory note or other evidence of the indebtedness of a Mortgagor with respect to a commercial
mortgage loan. 

        "Mortgaged Property": The real property (including all improvements, buildings, fixtures, building equipment and personal property thereon
and all additions, alterations and replacements made at any time with respect to the foregoing) and all other collateral securing repayment of the debt evidenced by a Mezzanine Note, a Junior Interest
Note or a Mortgage Note or, in the case of Preferred Equity, all such real property owned, and all other collateral pledged in favor of the holder of such Preferred Equity, by the issuer of such
Preferred Equity. 

        "Mortgagee": The record holder of a Mortgage Note secured by a Mortgage. 

        "Mortgagor": The obligor or obligors on a Mortgage Note, including any person who has assumed or guaranteed the obligations of the obligor
thereunder. 

        "Multiemployer Plan": A multiemployer plan defined as such in Section 3(37) of ERISA to which contributions have been or are
required to be made by Seller or any ERISA Affiliate and that is covered by Title IV of ERISA. 

        ["Net Cash Flow": With respect to any Underlying Mortgaged Property, for any period, the underwritten net cash flow calculated
in accordance with Buyer's customary criteria for commercial mortgage properties; provided, in all cases, that Net Cash Flow shall be subject to such
adjustments as Buyer deems appropriate in accordance with its underwriting guidelines for commercial mortgaged properties.] 

        "Net Income": With respect to any Person for any period, the net income of such Person for such period as determined in accordance with
GAAP. 

        "Newly Formed Subsidiary": shall mean a newly formed wholly owned Subsidiary of Parent established for the sole purpose of acquiring title
to an Eligible Asset in accordance with the terms of this Agreement, which Newly Formed Subsidiary shall be a Special Purpose Entity to the extent required by Buyer in its sole and absolute
discretion. 

        "Non-Consolidation Opinion": A "non-consolidation" opinion of outside counsel to Seller in form and substance
satisfactory to Buyer. 

        "Nonrecourse Indebtedness": With respect to any Person, Indebtedness for borrowed money in respect of which recourse for payment (except
for customary exceptions for fraud, misapplication of funds, environmental indemnities, and other similar exceptions to recourse liability (but not exceptions relating to bankruptcy, insolvency,
receivership or other similar events)) is contractually limited to specific assets of such Person encumbered by a Lien securing such Indebtedness. 

        "Operating Account": The account of Seller described on Schedule 3 hereto. 

        "Parent": Gramercy Capital Corp., a Maryland corporation. 

16

 

        "Pass-Through Interest": A certificate or certificates representing entire beneficial interests in a grantor trust or similar
pass-through special purpose entity exclusively holding any Whole Loans, Junior Interests, Mezzanine Loans, Preferred Equity, Distressed Debt, CMBS or RMBS; provided that such certificate
is and will be treated as debt by the United States Internal Revenue Service for tax purposes. 

        "Payment Calculation Date": The tenth (10th) day of each month. 

        "Payment Date": The fifteenth (15th) calendar day of each month, or if any such day is not a Business Day, the immediately
succeeding Business Day. 

        "PBGC": The Pension Benefit Guaranty Corporation established pursuant to Section 4002 of ERISA, or any successor thereto. 

        "Periodic Advance Repurchase Payment": The meaning specified in Section 3.06(a). 

        "Person": Any individual, limited liability company, partnership, joint venture, firm, corporation, association, trust or other enterprise
or any government or political subdivision or any agency, department or instrumentality thereof. 

        "Plan": Any pension plan as defined in Section 3(2) of ERISA, which is maintained or contributed to by (or to which there is an
obligation to contribute of) the Borrower or a Subsidiary of the Borrower or an ERISA Affiliate, and each such plan for the five year period immediately following the latest date on which the
Borrower, or a Subsidiary of the Borrower or an ERISA Affiliate maintained, contributed to or had an obligation to contribute to such plan. 

        "Pledge and Security Agreement": A Pledge and Security Agreement, substantially in the form attached as  Exhibit L hereto, made by [    ] in
favor of Buyer, as amended, restated, supplemented or otherwise modified
and in effect from time to time. 

        "Post-Default Rate": In respect of any day a Transaction is outstanding or any other amount under this Agreement or any other
Repurchase Document that is not paid when due to Buyer at the stated Repurchase Date or otherwise when due (a "Post-Default Day"), a rate
per annum on a 360 day per year basis during the period from and including the due date to but excluding the date on which such amount is paid in full equal to the Alternate Base Rate  plus 500
basis points on such Post-Default Day. 

        "Preferred Dividends": For any period and without duplication, all Restricted Payments paid or accrued during such period on Preferred
Securities issued by Seller or any Subsidiary thereof. Preferred Dividends shall not include dividends or distributions paid or payable (a) solely in Equity Interests (other than Mandatory
Redeemable Stock) payable to holders of such class of Equity Interests; (b) to any Seller or any Subsidiary thereof; or (c) constituting or resulting in the redemption of Preferred
Securities, other than scheduled redemptions not constituting balloon, bullet or similar redemptions in full. 

        "Preferred Equity": A performing current pay preferred equity position (with a put or synthetic maturity date structure replicating a debt
instrument) evidenced by a stock share certificate or other similar ownership certificate representing the entire equity ownership interest in entities that own income producing commercial real estate
for which the underwritten DSCR is not less than that set forth in the related Confirmation, taking into account, in the calculation of the LTV and the DSCR of such Preferred Equity, any senior
Indebtedness secured directly or indirectly by the applicable Underlying Mortgaged Property, including, without limitation, any preferred equity interest or mezzanine debt that is senior to the
related Mortgage Asset in right of payment or priority. 

        "Preferred Securities": With respect to any Person, Equity Interests in such Person that are entitled to preference or priority over any
other Equity Interest in such Person in respect of the payment (or accrual) of dividends or distribution of assets upon liquidation, or both. 

17

 

        "Price Differential": With respect to any Transaction hereunder as of any date, the aggregate amount obtained by daily application of the
applicable Pricing Rate in effect from time to time for such Transaction to the Purchase Price (decreased by any amounts previously paid by the applicable Seller to Buyer hereunder in respect of the
Purchase Price component of the Repurchase Price of such Mortgage Asset) for such Transaction on each day during the period commencing on (and including) the Purchase Date for such Transaction and
ending on (but excluding) the Repurchase Date (reduced by any amount of such Price Differential previously paid by the applicable Seller to Buyer with respect to such Transaction). 

        "Pricing Rate": With respect to a Mortgage Asset of a certain Class and the applicable Type of Underlying Mortgaged Property, at any date
of determination a rate per annum equal to the sum of (a) the Eurodollar Rate applicable on such date plus (b) the Pricing Spread for such
Mortgage Asset applicable on such date as set forth in the related Confirmation. 

        "Pricing Spread": The point spreads set forth in the related Confirmation corresponding to both the Classes of Mortgage Assets and the
Types of Underlying Mortgaged Property set forth therein; provided, that, (i) with respect to each Transaction comprised of more than one
(1) Type of Mortgage Asset, the Pricing Spread shall be based upon the Type of Underlying Mortgaged Property on a componentized basis and the weighted average Pricing Spread of the related
components as of any date of determination, (ii) in the event that such Transaction is comprised of Mortgage Assets each with a corresponding Book Value, the Pricing Spread shall be based upon
the Type of Underlying Mortgaged Property as of any date of determination and (iii) the Pricing Spread will vary in accordance with the Purchase Rate selected by Seller in the related
Confirmation. All such reductions and any other adjustments to the Pricing Rate shall be determined by Buyer in its sole discretion and shall be conclusive and binding absent manifest error. 

        "Prime Rate": The prime rate announced to be in effect from time to time by Buyer as its prime rate. The prime rate is not intended to be
the lowest general rate of interest charged by Buyer to its customers. 

        "Property": Any right or interest in or to property of any kind whatsoever, whether real, personal or mixed and whether tangible or
intangible. 

        "Properties": The meaning in Section 8.01(x). 

        "Purchase Agreement": Any purchase agreement by and between Seller and any third party, including without limitation, any Affiliate of
Seller, pursuant to which Seller has purchased assets subsequently sold to Buyer hereunder. 

        "Purchase Date": With respect to each Transaction, the date on which the related Mortgage Assets are transferred by Seller to Buyer or its
designee (including the Custodian), which date shall in no event be after the Final Purchase Date. 

        "Purchase Period": The period from and including the Effective Date to and including the Final Purchase Date. 

        "Purchase Price": On each Purchase Date, the price at which the respective Mortgage Assets are transferred by Seller to Buyer or its
designee (including the Custodian), which shall equal the Asset Value for such Mortgage Assets on the Purchase Date. 

        "Purchase Rate": With respect to a Mortgage Asset of a certain Class and the applicable Type of Underlying Mortgaged Property, the
"Purchase Rate" set forth in the applicable column in the related Confirmation; provided, however, that (i) in the event any DSCR criteria
applicable to a Mortgage Asset is not satisfied and Buyer nevertheless elects to enter into, or continue, a Transaction in respect of such Mortgage Asset, the applicable Purchase Rate shall be reduced
to the level at which all applicable DSCR criteria are satisfied and (ii) if, on any date after the one-year anniversary of the 

18

 

Effective
Date, the total number of Mortgage Assets is fewer than five (5), then on such date (and again on each one-year anniversary of such date) the Purchase Rate applicable to each
Mortgage Asset shall be reduced by 5.0% (e.g., from 65% to 60%). 

        "Purchased Assets": The Mortgage Assets sold by Seller to Buyer in a Transaction hereunder. 

        "Purchased Items": The meaning specified in Section 6.01. 

        "Qualified Servicer" shall mean any nationally recognized commercial mortgage loan servicer (other than ORIX Capital Markets LLC or any of
its Affiliates) rated at least "Css2" (or equivalent successor rating) by Fitch, Inc., or any successor to Fitch, Inc. and on the approved master servicer list or special servicer list
of Standard & Poor's Ratings Services, a division of The McGraw-Hill Companies, Inc. 

        ["Qualified Transferee":                        ] 

        "Ratings Agencies": Each of Fitch Ratings, Inc., Moody's Investors Services, Inc. or Standard and Poor's Ratings Services, a
division of the McGraw-Hill Companies, Inc., or their successors in interest, and such nationally recognized statistical rating agencies as may be designated by Buyer from time to
time. 

        "Regulations T, U and X": Regulations T, U and X of the Board of Governors of the Federal Reserve System (or any successor), as the same
may be modified and supplemented and in effect from time to time. 

        "REMIC": A real estate mortgage investment conduit, within the meaning of Section 860D(a) of the Code. 

        "REMIC Provisions": Provisions of the federal income tax law relating to real estate mortgage investment conduits, which appear at
Sections 860A through 860G of subchapter M of Chapter 1 of the Code, and related provisions, and regulations (including any applicable proposed regulations) and rulings promulgated thereunder, as the
foregoing may be in effect from time to time. 

        "REIT": A Person satisfying the conditions and limitations set forth in Section 856(b) and 856(c) of the Code which are necessary
to qualify such Person as a "real estate investment trust", as defined in Section 856(a) of the Code. 

        "Release Letter": A letter substantially in the form of Exhibit I hereto (or such
other form acceptable to Buyer). 

        "Reportable Event": Any of the events set forth in Section 4043(c) of ERISA, other than those events as to which the thirty day
notice period is waived under Sections .21, .22, .23, .26, .27 or .28 of PBGC Reg. § 4043. 

        "Repurchase Date": The date on which the applicable Seller is to repurchase the Purchased Assets from Buyer, which date shall not be later
than (a) 120 days after the Purchase Date, if Seller has not exercised its option to extend the Repurchase Date pursuant to Section 3.04(c) or (b) 210 days after the
Purchase Date, if Seller has exercised its option to extend the Repurchase Date pursuant to Section 3.04(c), provided that in no event shall the Repurchase Date occur after the Facility
Termination Date. 

        "Repurchase Documents": This Agreement, the Custodial Agreement, the Account Control Agreement, the Pledge and Security Agreement, all
Servicing Agreements (if any), all Interest Rate Protection Agreements (if any), the Guarantee Agreement and the Fee Letter. 

        "Repurchase Obligations": The meaning specified in Section 6.01(b). 

        "Repurchase Price": The price at which Purchased Assets are to be transferred from Buyer or its designee (including the Custodian) to the
applicable Seller upon termination of a Transaction, which 

19

 

will
be determined in each case (including Transactions terminable upon demand) as the sum of the Purchase Price and the Price Differential as of the date of such determination, decreased by all cash,
Income and Periodic Advance Repurchase Payments (including Late Payment Fees, if any) actually received by Buyer for its own account, and increased by all other costs, fees or other amounts payable to
Buyer by Seller under any Repurchase Document. 

        "Requirement of Law": As to any Person, the certificate of incorporation and by-laws or other organizational or governing
documents of such Person, and any law, treaty, rule or regulation or determination of an arbitrator or a court or other Governmental Authority (including, without limitation, those relating to
environmental standards and controls), in each case applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject. 

        "Responsible Officer": As to any Person, the chief executive officer, the chief financial officer, the chief accounting officer, the
treasurer or the chief operating officer of such Person. 

        "Restricted Payment": (a) Any dividend or other distribution, direct or indirect, on account of any Equity Interest of any Seller
or any Subsidiary thereof now or hereafter outstanding, except a dividend payable solely in Equity Interests of identical class to the holders of that class; (b) any redemption, conversion,
exchange, retirement, sinking fund or similar payment, purchase or other acquisition for value, direct or indirect, of any Equity Interest of any Seller or any Subsidiary thereof now or hereafter
outstanding; and (c) any payment made to retire, or to obtain the surrender of, any outstanding warrants, options or other rights to acquire any Equity Interests of any Seller or any Subsidiary
thereof now or hereafter outstanding. 

        "RMBS": Publicly offered, SEC registered pass-through certificates representing beneficial ownership interests in one or more
first lien mortgage loans secured by residential properties which are rated "AAA" (or equivalent) by any two Rating Agencies. 

        "SEC": The Securities and Exchange Commission, or any successor thereto. 

        "Security Agreement": With respect to any Mortgage Asset, any contract, instrument or other document related to security for repayment or
payment thereof (other than the related Mortgage and Mezzanine Note), executed by the Mortgagor or other applicable party (in the case of a Mezzanine Loan or Preferred Equity) and/or others in
connection with such Mortgage Asset, including without limitation, any security agreement, guaranty, title insurance policy, hazard insurance policy, chattel mortgage, letter of credit or certificate
of deposit or other pledged accounts, and any other documents and records relating to any of the foregoing. 

        "Seller": The meanings assigned thereto in the introductory paragraph hereof. 

        "Seller Asset Schedule": The meaning assigned thereto in the Custodial Agreement. 

        "Seller-Related Obligations": With respect to any Seller, any obligations of Seller hereunder and under any other arrangement between
Seller or an Affiliate of Seller on the one hand and Buyer or an Affiliate of Buyer on the other hand (including, without limitation, the Acquisition Facility and the Liquidity Facility). 

        "Servicer": The meaning specified in Section 11.03. 

        "Servicer Account": Any account established by Servicer in connection with the servicing of the Mortgage Assets. 

        "Servicer Notice": A notice from Seller, as applicable, to the Servicer, substantially in the form attached as  Exhibit F hereto. 

        "Servicing Agreement": The meaning specified in Section 11.03. 

20

 

        "Servicing File": With respect to each Mortgage Asset, the file retained by Seller consisting of originals of all documents in the
Mortgage Asset File which are not delivered to the Custodian and copies of all documents in the Mortgage Asset File set forth in Section 2.01 of the Custodial Agreement. 

        "Servicing Records": The meaning specified in Section 11.02. 

        "Settlement Agent": With respect to any Transaction, the entity approved by Buyer, in its sole discretion, which may be a title company,
escrow company or attorney in accordance with local law and practice in the appropriate jurisdiction of the related Wet Mortgage Asset, to which the proceeds of such Transaction are to be wired
pursuant to Section 3. 

        "Settlement Agent Notice": A notice delivered to the Buyer and Custodian from the Settlement Agent with respect to any Wet Mortgage
Assets, which states that all documents required to be delivered in respect of such Wet Mortgage Asset pursuant to this Agreement and the Custodial Agreement have been delivered to the Custodian. 

        "SLG": SL Green Realty Corp., a Maryland corporation. 

        "Special Purpose Entity" Any Newly Formed Subsidiary that has not, does not and will not: 

          (i)  engage
in any business or activity other than the ownership and maintenance of the Eligible Asset, and activities incidental thereto; 

         (ii)  acquire
or own any assets other than its Eligible Asset; 

        (iii)  merge
into or consolidate with any Person, or dissolve, terminate, liquidate in whole or in part, transfer or otherwise dispose of all or substantially all of its
assets or change its legal structure; 

        (iv)  fail
to observe all applicable organizational formalities, or fail to preserve its existence as an entity duly organized, validly existing and in good standing (if
applicable) under the applicable Legal Requirements of the jurisdiction of its organization or formation, or amend, modify, terminate or fail to comply with the provisions of its organizational
documents; 

         (v)  own
any subsidiary, or make any investment in, any Person; 

        (vi)  commingle
its assets with the assets of any other Person; 

       (vii)  incur
any debt, secured or unsecured, direct or contingent (including guaranteeing any obligation), other than the Loan; 

      (viii)  fail
to maintain its records, books of account, bank accounts, financial statements, accounting records and other entity documents separate and apart from those of
any other Person; except that any such Newly Formed Subsidiary's financial position, assets, liabilities, net worth and operating results may be included in the consolidated financial statements of
the Parent; 

        (ix)  enter
into any contract or agreement with any general partner, member, shareholder, principal, guarantor of the obligations of any such Newly Formed Subsidiary, or any
Affiliate of the foregoing, except upon terms and conditions that are intrinsically fair, commercially reasonable and substantially similar to those that would be available on an arm's length basis
with unaffiliated third parties; 

         (x)  maintain
its assets in such a manner that it will be costly or difficult to segregate, ascertain or identify its individual assets from those of any other Person; 

        (xi)  assume
or guarantee the debts of any other Person, hold itself out to be responsible for the debts of any other Person, or otherwise pledge its assets for the benefit
of any other Person or hold out its credit as being available to satisfy the obligations of any other Person; 

21

 

       (xii)  make
any loans or advances to any Person; 

      (xiii)  fail
to file its own tax returns or files a consolidated federal income tax return with any Person (unless prohibited or required, as the case may be, by applicable
Legal Requirements), except to the extent that Borrower is treated as a "disregarded entity" for tax purposes and is not required to file tax returns under applicable law, or pay any taxes required to
be paid under applicable law; 

      (xiv)  fail
to conduct its business solely in its own name; 

       (xv)  fail
to maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business
operations; 

      (xvi)  if
it is a partnership or limited liability company, without the unanimous written consent of all of its partners or members, as applicable (a) file or consent
to the filing of any petition, either voluntary or involuntary, to take advantage of any Debtor Relief Laws, (b) seek or consent to the appointment of a receiver, liquidator or any similar
official, (c) take any action that might cause such entity to become insolvent, (d) make an assignment for the benefit of creditors, or (e) allow any Lien to encumber its Eligible
Asset or any portion thereof; 

     (xvii)  fail
to allocate shared expenses (including, without limitation, shared office space and services performed by an employee of an Affiliate) among the Persons sharing
such expenses or to use separate stationery, invoices and checks; 

    (xviii)  fail
to remain solvent or pay its own liabilities (including, without limitation, salaries of its own employees) only from its own funds; 

      (xix)  acquire
obligations or securities of its partners, members, shareholders or other affiliates, as applicable; or 

       (xx)  fail
to maintain a sufficient number of employees in light of its contemplated business operations. 

        "Stabilized DSCR": [With respect to any Mortgage Asset, as of any date of determination, the ratio of (x) Net Cash Flow
(calculated using the projected Net Cash Flow at the maturity of the Mortgage Asset, annualized) to (y) debt service due using the applicable refinance constant (for the related Underlying
Mortgaged Property then being [used by the Rating Agencies] and the projected outstanding balance of such Mortgage Asset]. 

        "Subsidiary": With respect to any Person, any corporation, partnership, limited liability company or other entity (heretofore, now or
hereafter established) of which at least a majority of the securities or other ownership interests having by the terms thereof ordinary voting power to elect a majority of the board of directors or
other persons performing similar functions of such corporation, partnership, limited liability company or other entity (without regard to the occurrence of any contingency) is at the time directly or
indirectly owned or controlled by such Person or one or more Subsidiaries of such Person or by such Person and one or more Subsidiaries of such Person, and shall include all Persons the accounts of
which are consolidated with those of such Person pursuant to GAAP. 

        "Tax Based Accounting Principles": With respect to any Person, those generally accepted tax accounting principles and practices which are
recognized as such in the United States for the purposes of complying with filing and reporting obligations under the Code, and which are consistently applied for
all periods, after the date hereof, so as to properly and fairly reflect the financial position of such Person. 

        "Test Period": Any fiscal quarter, commencing with the fiscal quarter ending on September 30, 2004. 

22

 

        "Total Liabilities Ratio": As to any Person, the ratio of (a) the Total Indebtedness of such Person to (b) the Total Assets
of such Person. 

        "Transaction": The meaning specified in Section 1.01. 

        "Transaction Request": The meaning specified in Section 3.03(a). 

        "True Sale Opinion": A "true sale" opinion of outside counsel to Seller in form and substance satisfactory to Buyer. 

        "Trust Receipt": A trust receipt issued by the Custodian to Buyer confirming the Custodian's possession of certain Mortgage Asset Files
which are held by the Custodian for the benefit of Buyer or the registered holder of such trust receipt. 

        "Type": With respect to a Mortgaged Property, such Mortgaged Property's classification as one of the following: (a) multifamily,
(b) retail, (c) office, (d) industrial, (e) hotel, (f) student housing, (g) medical office product, (h) self-storage or (i) nursing
home. 

        "UCC Financing Statement": A financing statement on Form UCC-1 or the proper national UCC form, naming Buyer as "Secured
Party" and Seller as "Debtor" and describing the Purchased Items. 

        "Unconsolidated Affiliates": With respect to any Person, any other Person in whom such Person holds an Investment, which Investment is
accounted for in the financial statements of such Person on an equity basis of accounting and whose financial results would not be consolidated under GAAP with the financial results of such Person on
the consolidated financial statements of such Person. 

        "Underlying Mortgage Loan": With respect to any Junior Interest, Mezzanine Loan, Preferred Equity, CMBS or RMBS, a mortgage loan made in
respect of the related Underlying Mortgaged Property. 

        "Underlying Mortgaged Property": In the case of any: 

        (a)   Whole
Loan, the Mortgaged Property securing such Whole Loan; 

        (b)   Junior
Interest, the Mortgaged Property securing such Junior Interest (if the Junior Interest is of the type described in clause (a) of the definition thereof),
or the Mortgaged Property securing the Mortgage Loan in which such Junior Interest represents a junior participation (if the Junior Interest is of the type described in clause (b) of the
definition thereof); 

        (c)   Mezzanine
Loan, the Mortgaged Property that is owned by the Person the Capital Stock of which is pledged as collateral security for such Mezzanine Loan; 

        (d)   Preferred
Equity, the income producing commercial real estate owned by the entity whose equity ownership interest is represented by such Preferred Equity; 

        (e)   CMBS,
the Mortgaged Property securing the mortgage loans related to such security; 

        (f)    RMBS,
the Mortgaged Property securing the mortgage loans related to such security; and 

        (h)   Pass-Through
Interest, the Mortgaged Property related to the applicable mortgage asset, which the Pass-Through Interest represents an interest
in. 

        "Underlying Obligor": Individually and collectively, as the context may require, the obligor or obligors under a Mortgage Asset, including
any Person that has not signed the related Mortgage Note but owns an interest in the related Underlying Mortgaged Property, which interest has been encumbered to secure such Mortgage Asset. 

        "Underwriting Package": An internal document or credit committee memorandum (redacted to protect confidential information) setting forth
all material information relating to a Mortgage Asset, prepared by a Seller for its evaluation of such Mortgage Asset, to include at a minimum the data 

23

 

required
in the relevant Confirmation. In addition, (a) with respect to each Mortgage Asset which does not consist of RMBS and CMBS, the Underwriting Package shall include, to the extent
applicable, (i) a copy of the appraisal, (ii) the current occupancy report (including tenant stack and rent roll), (iii) a minimum of two (2) years of property level
financial statements to the extent available, (iv) current financial statement of the obligor, if any, on the commercial mortgage loan, if available, (vi) the Mortgage Asset File,
(vii) all third party reports and agreed upon procedures, any letters and reports (whether drafts or final forms), site inspection reports, market studies and any other diligence conducted by
Seller relating to such Mortgage Asset, (viii) aging of all accounts receivable and accounts payable, (ix) copies of all transaction documentation and (x) such further documents
or information as Buyer may request; 

        (b)   with
respect to each Mortgage Asset which consists of RMBS, the Underwriting Package shall include, to the extent applicable, (i) the related prospectus,
(ii) all distribution date statements issued in respect thereof during the immediately preceding 12 months (or, if less, since the date such RMBS was issued) and (iii) any other
information delivered to certificate holders in respect of such RMBS during the immediately preceding 6 months; 

        (c)   with
respect to any Mortgage Asset which consists of CMBS, the Underwriting Package shall include, to the extent applicable, (i) the related prospectus or
offering circular, (ii) all structural and collateral term sheets and all other computational or other similar materials provided to Seller in connection with its acquisition of such CMBS,
(iii) all distribution date statements issued in respect thereof during the immediately preceding 12 months (or, if less, since the date such CMBS was issued), (iv) all monthly
CSMA reporting packages issued in respect of such CMBS during the immediately preceding 12 months (or, if less, since the date such CMBS was issued), (v) all Rating Agency
pre-sale reports and (vi) all asset summaries and any other due diligence materials, including, without limitation, reports prepared by third parties, provided to Seller in
connection with its acquisition of such CMBS. 

        "Uniform Commercial Code" or "UCC": The Uniform Commercial Code as in effect on the date hereof in the State of New York; provided that if
by reason of mandatory provisions of law, the perfection, the effect of perfection or nonperfection, or the priority of the security interest in any Purchased Items is governed by the Uniform
Commercial Code as in effect in a jurisdiction other than New York, "Uniform Commercial Code" shall mean the Uniform Commercial Code as in effect in such other jurisdiction for purposes of the
provisions hereof relating to such perfection, effect of perfection or nonperfection, or priority. 

        "Wachovia Facility": Any of this Agreement, the Liquidity Facility or the Master Repo Facility. 

        "Wet Funding": A Transaction for which Seller has delivered to Buyer a Wet Transaction Request and, a pledge by Seller to Buyer to deliver
to Custodian a complete Mortgage Asset File within five (5) Business Days of the related Purchase Date. 

        "Wet Mortgage Asset": A Mortgage Asset for which a complete Mortgage Asset File will be delivered to Custodian within five
(5) Business Days of the related Purchase Date and which Seller has agreed to pledge to Buyer all right, title and interest in, to and under such Mortgage Asset, free and clear of all liens,
pledges, charges, encumbrances or security interests of any nature. 

        "Wet Transaction Request Package": The documents required to be delivered to Buyer at the time a Wet Transaction Request is delivered to
Buyer, which shall include the following: 

	(a)
	an
appraisal meeting the standards of FIRREA and stating that the LTV of the related Underlying Mortgaged Property is not greater than 78% (except with respect to hotels, in which
case the related LTV shall not be greater than 60%);

	(b)
	an
environmental report indicating no material environmental condition for which recommended reserves have not been established; and 

24

 

	(c)
	written
certification that such Mortgage Asset meets the requisite DSCR required for such asset type and that all covenants, representations and warranties contained herein have been
complied with (together with such additional materials as Buyer may request. 

        "Whole Loan" A performing first priority commercial real estate whole loan for which the underwritten DSCR is not less than that set forth
in the related Confirmation as determined by Buyer after taking into account any reserves and any other adjustments which Whole Loan includes, without limitation, (i) a Mortgage Note and
related Mortgage, and (ii) all right, title and interest of Seller in and to the Mortgaged Property covered by such Mortgage. The Whole Loan LTV and DSCR must take into account any senior
Indebtedness secured directly or indirectly by the applicable Underlying Mortgaged Property, including, without limitation, any preferred equity interest or mezzanine debt that is senior to the
related Mortgage Asset in right of payment or priority. 

        Section 2.02    Other Definitional Provisions; Determinations by Buyer.    

        (a)   All
references to, and calculations required to be made in respect of, any principal and/or interest associated with any Mortgage Asset, shall, with respect to Mortgage
Assets consisting of Preferred Equity, be deemed to refer, respectively, to the face amount of such Preferred Equity and the preferred return or yield (however such terms are denominated, as set forth
in the related Mortgage Asset documents), whether payable or accrued. 

        (b)   As
used herein, and any certificate or other document made or delivered pursuant hereto, accounting terms relating to a Seller not defined in Section 2.01, and
accounting terms partly defined in Section 2.01, to the extent not defined, shall have the respective meanings given to them under GAAP. 

        (c)   The
words "hereof," "herein" and "hereunder" and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular
provision of this Agreement, and section, schedule and exhibit references are to this Agreement unless otherwise specified. 

        (d)   The
meanings given to terms defined herein shall be equally applicable to both the singular and plural forms of such terms. 

        (e)   All
matters to be determined by Buyer in its sole discretion hereunder shall be determined by Buyer in its sole discretion exercised in good faith. 

 
 

ARTICLE III
  
  INITIATION; TERMINATION    
    

        Section 3.01    Conditions Precedent to Initial Transaction.    Buyer's agreement to enter into the initial
Transaction hereunder is subject to the satisfaction, immediately prior to or concurrently with the making of such Transaction, of the condition precedent that Buyer shall have received from Seller
payment of an amount equal to all fees and expenses payable hereunder and pursuant to the Fee Letter, and all of the following documents, each of which shall be satisfactory in form and substance to
Buyer and its counsel: 

        (a)   The
following Repurchase Documents, as well as certain other documents, delivered to Buyer: 

          (i)  Acquisition Repurchase Agreement.    This Acquisition Repurchase Agreement duly completed and executed by each
of the parties hereto; 

         (ii)  Custodial Agreement.    The Custodial Agreement, duly executed and delivered by each of the parties thereto; 

25

 

        (iii)  Account Control Agreement.    The Account Control Agreement, duly executed and delivered by each of the
parties thereto; 

        (iv)  Interest Rate Protection Agreements.    All Interest Rate Protection Agreements required pursuant to
Section 9.01(u), duly executed and delivered by each of the parties thereto; 

         (v)  Guarantee Agreement.    The Guarantee Agreement, duly executed and delivered by the Guarantors; 

        (vi)  Pledge and Security Agreement.    The Pledge and Security Agreement, substantially in the form attached hereto
as Exhibit L, duly executed and delivered by each of the parties thereto; 

       (vii)  Consents and Waivers.    Any and all consents and waivers applicable to any Seller or to the Mortgage Assets; 

      (viii)  UCC Financing Statement.    UCC Financing Statements naming each Seller as "Debtor" and Buyer as "Secured
Party" and describing as "Collateral" the Purchased Items and any other documents necessary or requested by Buyer to perfect the security interests granted by Seller in favor of Buyer under this
Agreement or any other Repurchase Document; 

        (b)    Opinions of Counsel.    An opinion or opinions of outside counsel to Seller, which opinion or opinions shall be
satisfactory in form and substance to Buyer and shall include general issues of formation and enforceability with respect to each Seller, first priority perfected security interest with respect to the
Purchased Assets, a Non-Consolidation Opinion and a True Sale Opinion, and such other issues as requested by Buyer; 

        (c)    Organizational Documents.    A good standing certificate and certified copies of the charter and
by-laws (or equivalent documents) of each Seller and of all corporate or other authority for each Seller with respect to the execution, delivery and performance of the Repurchase Documents
and each other document to be delivered by Seller from time to time in connection herewith (and Buyer may conclusively rely on such certificate until it receives notice in writing from Seller to the
contrary); 

        (d)    Servicing Agreement.    With respect to any Eligible Asset to be purchased hereunder on the related Purchase
Date which is not serviced by Seller, Seller shall have provided to Buyer a copy of the related Servicing Agreement, certified as a true, correct and complete copy of the original, together with a
Servicer Notice, fully executed by Seller and Servicer; 

        (e)    Fees and Expenses.    Buyer shall have received payment from Seller of an amount equal to the amount of actual
costs and expenses, including, without limitation, the fees and expenses of counsel to Buyer, incurred by Buyer in connection with the development, preparation and execution of this Agreement, the
other Repurchase Documents and any other documents prepared in connection herewith or therewith; 

        (f)    No Default.    No Default or Event of Default has occurred under this Agreement, the Liquidity Facility or the
Master Repo Facility; and 

        (g)    Other Documents.    Buyer shall have received all such other and further documents, documentation and legal
opinions as Buyer in its sole discretion shall reasonably require. 

        Section
3.02    Conditions Precedent to all Transactions.    Buyer's agreement to enter into each Transaction
(including the initial Transaction) is subject to the satisfaction of the following further conditions precedent, both immediately prior to entering into such Transaction and also after giving effect
to the consummation thereof and the intended use of the proceeds of the sale: 

        (a)   the
applicable Seller shall have delivered a Confirmation via Electronic Transmission and a Transaction Request Package acceptable to Buyer in accordance with the
procedures set forth in Section 3.03, and Buyer shall have determined that the Mortgage Asset described in such Confirmation 

26

 

is
an Eligible Asset, shall have approved the purchase of the Mortgage Asset to be included in such Transaction in its sole and absolute discretion and shall have obtained all necessary internal
credit approvals for such Transaction; 

        (b)   no
Default or Event of Default shall have occurred and be continuing under this Agreement, the Guarantee Agreement or any other Repurchase Document and no event shall
have occurred which has, or would reasonably be expected to have, a Material Adverse Effect; 

        (c)   Buyer
shall have received a certificate of a Responsible Officer of the applicable Seller, substantially in the form of  Exhibit K hereto, (i) showing in detail the calculations demonstrating that,
after giving effect to the requested Transaction, no Margin
Deficit shall then exist, (ii) stating that, to the best of such Responsible Officer's knowledge, since the date of the certificate most recently delivered pursuant to
Section 9.01(b)(ii), the applicable Seller has observed or performed all of its covenants and other agreements in all material respects, and satisfied in all material respects, every condition,
contained in this Agreement and the related documents to be observed, performed or satisfied by it, and that such Responsible Officer has obtained no knowledge of any Default or Event of Default
except as specified in such certificate, (iii) describing all interests of Seller's Affiliates in any Underlying Mortgaged Property related to any proposed Mortgage Asset (including without
limitation, any lien, encumbrance or other debt or equity position or other interest in the Underlying Mortgaged Property that is senior or junior to the proposed Mortgage Asset in right of payment or
priority) and (iv) showing in detail the calculations supporting such Responsible Officer's certification of the applicable Seller's compliance with the requirements of Sections 9.01(f) and
9.01(l)-(n); 

        (d)   both
immediately prior to the requested Transaction and also after giving effect thereto and to the intended use thereof, the representations and warranties made by the
applicable Seller in Section 8.01 and in Schedules 1(a)-1(h), as applicable, shall be true, correct and complete on and as of such Purchase Date in all material respects with the
same force and effect as if made on and as of such date (or, if any such representation or warranty is expressly stated to have been made as of a specific date, as of such specific date); 

        (e)   subject
to Buyer's right to perform one or more Due Diligence Reviews pursuant to Section 12.11, (i) in the case of a Dry Mortgage Asset, Buyer shall have
completed its due diligence review of the Mortgage Asset File and the Mortgage Asset File for each Purchased Asset, and such other documents, records, agreements, instruments, mortgaged properties or
information relating to such Purchased Asset as Buyer in its sole discretion deems appropriate to review and such review shall be satisfactory to Buyer in its sole discretion and Buyer has consented
in writing to the related Mortgage Asset becoming a Purchased Asset, and (ii) in the case of a Wet Mortgage Asset, Seller has delivered a Wet Transaction Request and pledge to deliver a
complete Mortgage Asset File with respect to any Wet Mortgage Assets identified on such Wet Transaction Request within five (5) Business Days of the related Purchase Date;  provided, that, with
respect to any Dry Mortgage Assets, if Buyer's diligence review of the Mortgage Asset File requires the delivery of a mortgage file
or the equivalent, Seller shall have the benefit of such delayed delivery provisions as are customary in pooling and servicing agreements (e.g., while a promissory note (or analogous document directly
evidencing the obligation) must be delivered as a condition of closing, an ancillary document or estoppel may be delivered within a reasonable timeframe thereafter); 

        (f)    with
respect to any Eligible Asset to be purchased hereunder on the related Purchase Date which is not serviced by the applicable Seller or an Affiliate thereof, the
applicable Seller shall have provided to Buyer a copy of the related Servicing Agreement, certified as a true, correct and complete copy of the original, together with a Servicer Notice, fully
executed by Seller and the Servicer; 

        (g)   Buyer
shall have received all fees and expenses of counsel to Buyer as required hereunder and/or by the Fee Letter and Section 12.01 and, to the extent Seller is
required hereunder to reimburse Buyer for such amounts, Buyer shall have received the costs and expenses incurred by it in connection 

27

 

with
the entering into of any Transaction hereunder, including, without limitation, costs associated with due diligence, recording or other administrative expenses necessary or incidental to the
execution of any Transaction hereunder, which amounts, at Buyer's option, may be withheld from the sale proceeds of any Transaction hereunder; 

        (h)   no
Margin Deficit shall exist, either immediately prior to or after giving effect to the requested Transaction, and none of the following shall have occurred and/or be
continuing: 

          (i)  an
event or events shall have occurred in the good faith determination of Buyer resulting in the effective absence of a "repo market" or related "lending market" for
purchasing (subject to repurchase) or financing debt obligations secured by commercial mortgage loans or securities or an event or events shall have occurred resulting in Buyer not being able to
finance Mortgage Assets through the "repo market" or "lending market" with traditional counterparties at rates which would have been reasonable prior to the occurrence of such event or events; or 

         (ii)  an
event or events shall have occurred resulting in the effective absence of a "securities market" for securities backed by Mortgage Assets or an event or events shall
have occurred resulting in Buyer not being able to sell securities backed by Mortgage Assets at prices which would have been reasonable prior to such event or events; 

        (i)    Buyer
shall have received from the Custodian on each Purchase Date an Asset Schedule and Exception Report with respect to each Purchased Asset, dated the Purchase Date,
duly completed and with exceptions acceptable to Buyer in its sole discretion in respect of Eligible Assets to be purchased hereunder on such Business Day; 

        (j)    Buyer
shall have received from the applicable Seller a Release Letter covering each Eligible Asset to be sold to Buyer; 

        (k)   prior
to the purchase of any Mortgage Asset acquired (by purchase or otherwise) by the applicable Seller from any Affiliate of Seller, Buyer shall have received a
Non-Consolidation Opinion and a True Sale Opinion; 

        (l)    Buyer
shall not have reasonably determined that the introduction of, or a change in, any Requirement of Law or in the interpretation or administration of any Requirement
of Law applicable to Buyer has made it unlawful, and no Governmental Authority shall have asserted that it is unlawful, for Buyer to enter into Transactions; 

        (m)  the
initial Purchase Price specified in a Confirmation for a Mortgage Asset shall not be less than $3,000,000 and increments of $100,000 thereafter; provided, that two
(2) Confirmations per calendar month may specify an initial Purchase Price in an amount greater than $1,000,000 and less than $3,000,000. 

        (n)   the
Repurchase Date for such Transaction is not later than the Facility Termination Date; 

        (o)   the
applicable Seller shall have taken such other action as Buyer shall have reasonably requested in order to transfer the Purchased Assets pursuant to this Agreement
and to perfect all security interests granted under this Agreement or any other Repurchase Document in favor of Buyer with respect to the Purchased Assets; 

        (p)   the
weighted average Purchase Rate of all Mortgage Assets shall not exceed 85.0%; 

        (q)   the
weighted average LTV of all Mortgage Assets multiplied by the weighted average Purchase Rate of all Mortgage Assets shall not exceed 80.0%; 

        (r)   with
respect to any Wet Mortgage Assets, Buyer shall have received a Wet Transaction Request Package, an Escrow Agreement in the form attached hereto as  Exhibit M and a Closing Letter in the form
attached hereto as Exhibit N; 

28

  

        (s)   Seller shall have delivered to Buyer a Compliance Certificate in the form attached hereto as Exhibit J; and 

        (t)    Buyer
shall have received all such other and further documents, documentation and legal opinions (including, without limitation, opinions regarding the perfection of
Buyer's security interests) as Buyer in its reasonable discretion shall reasonably require. 

        Each
Confirmation delivered by any Seller hereunder shall constitute a certification by Seller that all the conditions set forth in this Section 3.02 with respect to Seller have
been satisfied, waived or is not applicable (both as of the date of such notice or request and as of the date of such purchase). 

        Section
3.03    Transaction Mechanics; Related Matters.    (a) During the Purchase Period, in the sole
discretion of Buyer, Buyer may from time to time purchase from Seller certain Eligible Assets. Seller may request Transactions from Buyer not more than twice per calendar month during the Purchase
Period. Buyer shall use commercially reasonable efforts to purchase each Mortgage Asset for which Seller delivers a Transaction Request to Buyer within one (1) Business Day after Buyer approves
such Transaction and delivers the related Confirmation. 

        (b)   With
respect to Dry Mortgage Assets, Seller shall request a Transaction by delivering to Buyer (with a copy to the Custodian) via Electronic Transmission a request in
the form of Exhibit A-1 attached hereto (a "Dry Transaction Request"). Each such Dry Transaction Request shall describe the Mortgage Assets proposed to be purchased in a Seller
Asset Schedule, and set forth (i) the proposed Purchase Date (which date, notwithstanding any extension of the Facility Termination Date which may occur in accordance with Section 3.05,
shall not be later than the Final Purchase Date), (ii) the proposed Purchase Price, (iii) the proposed Repurchase Date, (iv) the Pricing Rate applicable to the Transaction,
(v) the applicable Class and Type for each Mortgage Asset for which Seller is requesting the Transaction and (vi) any additional terms or conditions not inconsistent with this Agreement
and shall be accompanied by the Underwriting Package with respect to Dry Mortgage Assets. In addition, Seller shall cause the Mortgage Asset File with respect to each Dry Mortgage Asset to be
delivered to Custodian ten (10) Business Days prior to the related Purchase Date. 

        (c)   Upon
receipt of the complete Mortgage Asset File with respect to Dry Mortgage Assets, Buyer shall notify Seller of its approval or disapproval of each proposed Mortgage
Asset within ten (10) Business Days after such receipt (with respect to Dry Mortgage Assets); provided, that with respect to any Transaction Request pertaining to a pool consisting of more than
three (3) proposed Mortgage Assets, Buyer may notify Seller of its approval or disapproval of such proposed Mortgage Assets after such ten (10) Business Day period, provided such notice
is given as soon as practicable after the expiration of such period. 

        (d)   With
respect to any Wet Mortgage Assets, Seller shall request a Transaction by delivering to Buyer (with a copy to the Custodian) via Electronic Transmission a request
in the form of Exhibit A-2 attached hereto (a "Wet Transaction Request") which shall be accompanied by a complete Wet Transaction Request Package. Such Wet Transaction Request and
Wet Transaction Request Package shall be delivered no later than 11:00 a.m. (eastern time) on the requested Purchase Date. If such Wet Transaction Request and Wet Transaction Request Package
are delivered after 11:00 a.m. on the requested Purchase Date, the Purchase Date for the related Wet Mortgage Assets will be the following Business Day. Each such Wet Transaction Request shall
describe the Mortgage Assets proposed to be purchased in a Seller Asset Schedule, and set forth (i) the proposed Purchase Date (which date, notwithstanding any extension of the Facility
Termination Date which may occur in accordance with Section 3.05, shall not be later than the Final Purchase Date), (ii) the proposed Purchase Price, (iii) the proposed Repurchase
Date, (iv) the Pricing Rate applicable to the Transaction, (v) the applicable Class and Type for each Mortgage Asset for which Seller is requesting the Transaction and (vi) any
additional terms or conditions not inconsistent with this Agreement. In the event of any conflict between the terms of such Confirmation and this Agreement, the terms of this Agreement shall prevail. 

29

 

        (e)   Notwithstanding
any other provision hereunder, the fact that Buyer has conducted or has failed to conduct any partial or complete examination or any other due diligence
review of any Purchased Asset shall in no way affect any rights Buyer (or any of its successors) may have hereunder or otherwise with respect to any representations or warranties or other rights
hereunder, including without limitation, the right to determine at any time that such Purchased Asset is not an Eligible Asset. 

        (f)    On
the Purchase Date for each Mortgage Asset approved by Buyer, the applicable Seller shall forward to Buyer via Electronic Transmission, a confirmation of each
Transaction, substantially in the form of Exhibit B attached hereto (a "Confirmation"). The
Confirmation shall specify any additional terms or conditions of the Transaction not inconsistent with this Agreement or as otherwise agreed to by Buyer. In the event that the terms of the related
Confirmation are inconsistent with the terms of this Agreement, this Agreement shall supersede the Confirmation with respect to the inconsistent terms only;  provided, however, that the Confirmation and this Agreement shall be construed to be cumulative to the
extent possible. Upon receipt of the Confirmation, Buyer shall evidence its agreement to enter into the requested Transaction by its signature thereon and return such Confirmation to the Seller. Any
Confirmation executed by Buyer shall be deemed to have been received by the applicable Seller on the date such executed Confirmation is actually received by Seller. 

        (g)   With
respect to Wet Mortgage Assets, following the receipt of a Confirmation from Buyer, the related Escrow Agreement, Closing Letter and Settlement Agent Notice shall
be delivered to Custodian with a copy to Buyer not later than 11:00 a.m. (eastern time) on the requested Purchase Date, as provided in the Custodial Agreement. Following Buyer's receipt of the
faxed Escrow Agreement and Closing Letter and Buyer's determination that each of the Wet Mortgage Assets is an Eligible Asset, Buyer shall wire funds pursuant to wiring instructions set forth in the
Escrow Agreement. On the Business Day that Custodian receives the complete Mortgage Asset Files, the Custodian will notify Buyer of its receipt of such Mortgage Asset Files and deliver to Buyer a
Trust Receipt. Seller shall cause the Settlement Agent to deliver the Mortgage Asset File with respect to each Mortgage Asset within one (1) Business Day following the Purchase Date. Within
five (5) Business Days of receipt of such Mortgage Asset Files, Custodian shall deliver to Buyer an Asset Schedule and Exception Report. 

        (h)   With
respect to Dry Mortgage Assets, at least seven (7) Business Days prior to the requested Purchase Date, the Mortgage Asset Documents pertaining to each Dry
Mortgage Asset to be purchased by Buyer shall be delivered to the Custodian in accordance with the Custodial Agreement. With respect to each Wet Mortgage Asset, no later than 11:00 a.m.
(eastern time) on the Business Day prior to the Purchase Date, Seller shall deliver to Buyer a completed Wet Transaction Request and Wet Transaction Request Package, along with any other documents or
certifications required to be delivered in connection with such Wet Transaction Request pursuant to the Custodial Agreement. Within five (5) Business Days of the related Purchase Date, the
Mortgage Asset Documents pertaining to each Wet Mortgage Asset purchased by Buyer shall be delivered to the Custodian in accordance with the Custodial Agreement. 

        (i)    Except
as set forth in Section 3.04, each Confirmation, together with this Agreement, shall constitute conclusive evidence of the terms agreed between Buyer and
the applicable Seller with respect to the Transaction to which the Confirmation relates, and the applicable Seller's acceptance of the related proceeds shall constitute Seller's agreement to the terms
of such Confirmation. It is the intention of the parties that each Confirmation shall not be separate from this Agreement but shall be made a part of this Agreement. 

        (j)    On
the Repurchase Date, termination of a Transaction will be effected by transfer to the applicable Seller or its designee of the Purchased Assets and receipt of the
Repurchase Price by Buyer. To the extent a net amount is owed to one party, the other party shall pay such amount to such party. 

30

 

Buyer
shall direct Custodian to deliver the related Mortgage Files to the applicable Seller or its designee at Seller's expense on the Repurchase Date. 

        (k)   In
no event shall a Transaction be entered into when any Margin Deficit exists or when any Default or Event of Default has occurred and is continuing, when the
Repurchase Date for such Transaction would be later than the Facility Termination Date or to the extent that after giving effect to such Transaction the aggregate Repurchase Price of all Mortgage
Assets subject to Transactions then outstanding would exceed the Maximum Amount. 

        (l)    Pursuant
to Section 3.01(b) of the Custodial Agreement, the Custodian shall deliver to Buyer and Seller an Asset Schedule and Exception Report with respect to the
Dry Mortgage Assets which the applicable Seller has requested Buyer purchase on such Purchase Date, and no later than 12:00 p.m., New York City time, on each Purchase Date, the Custodian shall
deliver to Buyer a Dry Trust Receipt in respect of all such Dry Mortgage Assets purchased by Buyer on such Purchase Date. Subject to the provisions of this Article III, the Purchase Price for
each Eligible Asset will be made available to the applicable Seller by Buyer transferring the aggregate amount of such Purchase Price in accordance with the wiring instructions set forth in respect of
Seller on Schedule 2.

        Section
3.04    Repurchases.    

        (a)    Optional Repurchases.    Subject to the payment of any LIBOR breakage costs and any other fee or payment then
due in accordance with terms hereof, the applicable Seller may repurchase Purchased Assets, without penalty or premium (other than any fees payable), in whole on any date and in part on any date so
long as no Margin Deficit, Default or Event of Default shall have occurred and then be continuing. If the applicable Seller intends to make any such repurchase, Seller shall give one
(1) Business Day's prior written notice thereof to Buyer, which notice shall specifically identify any Purchased Assets to be repurchased in whole. The Repurchase Price specified in any such
notice shall be due and payable on the date specified therein, and, upon payment thereof, such amount shall be applied (i) with respect to Purchased Assets being repurchased in whole, subject
to Section 3.04(c), to the Repurchase Price of the Purchased Assets identified by the Seller and (ii) with respect to repurchases made in part, pro rata to the Repurchase Price of all
Purchased Assets. 

        (b)    Mandatory Repurchases.    

        (i)    In
the event that the Facility Termination Date is extended in accordance with Section 3.05(a), in addition to any other amounts due and payable at any time
pursuant to this Agreement or any other Repurchase Document, Seller shall make equal quarterly payments, beginning on the date occurring three (3) calendar months after the Initial Termination
Date (or if such date is not a Business Day, on the immediately preceding Business Day), in a total amount equal to the aggregate Repurchase Price outstanding as of the Initial Termination Date,
unless the aggregate Repurchase Price is paid in full prior to such quarterly payments being due. 

        (ii)   In
the event that the weighted average Purchase Rate of all Mortgage Assets exceeds 85.0%, Seller shall repurchase such Mortgage Assets as Buyer shall have determined
are necessary so that the weighted average Purchase Rate of all Mortgage Assets does not exceed 85.0%; provided,  however, that, so long as no Default or
Event of Default has occurred, if a Seller specifically notifies Buyer in writing prior to Buyer purchasing a
particular Mortgage Asset that purchasing such Mortgage Asset will cause the weighted average Purchase Rate to exceed 85.0% and Buyer approves and purchases such Mortgage Asset, Seller shall not be
required to repurchase any Mortgage Assets based solely on the increased weighted average Purchase Rate caused by the purchase of such Mortgage Asset. Notwithstanding the foregoing, nothing in this
subsection shall in any way impair Buyer's ability to issue a Margin Deficit Notice and require satisfaction of any Margin Deficit in the manner and within the time frames as provided in this
Agreement. 

31

 

        (iii)  In
the event that the product of the weighted average LTV of all Mortgage Assets multiplied by the weighted average Purchase Rate of all Mortgage Assets exceeds 80.0%,
Seller shall repurchase such Mortgage Assets as Buyer shall have determined are necessary so that the weighted average LTV of all Mortgage Assets multiplied by the weighted average Purchase Rate of
all Mortgage Assets does not exceed 80.0%. 

        (c)    Extension of Repurchase Date.    Seller may extend the initial Repurchase Date with respect to a Mortgage Asset
to 210 days (but no longer than 210 days) after the related Purchase Date by making a prepayment to Buyer in an amount sufficient to reduce the Purchase Rate by 10% (e.g. if the then
current Purchase Rate is 50%, then such prepayment must be sufficient to reduce such Purchase Rate to 40%). 

        Section 3.05    Facility Termination Date; Maximum Amount.    

        (a)    Extension of Facility Termination Date.    Upon written request of all of Seller delivered to Buyer at least
ninety (90) days, but in no event earlier than 120 days, prior to the Initial Termination Date, and so long as no event which has a Material Adverse Effect and no Margin Deficit, Default
or Event of Default, or any default under any other Repurchase Document, shall have occurred and be continuing on the Initial Termination Date and so long as all representations and warranties are
true, correct, complete, and accurate in all material respects at the time of such extension, Buyer may in its sole discretion agree to extend the Facility Termination Date, for a period not to exceed
364 days, by giving written notice to Seller of such extension and of the new Facility Termination Date determined by Buyer and the dates and amounts of the payments required to be made under
Section 3.04(b); provided, that (i) any failure by Buyer to deliver any such notice of extension to Seller shall be deemed to be Buyer's
determination not to extend the Facility Termination Date, (ii) in no event shall the Facility Termination Date be extended beyond the Final Purchase Date and (iii) in no event shall the
Facility Termination Date be extended unless, as of the Initial Termination Date, (A) the Parent shall be listed on a national securities exchange and (B) Buyer shall have received
payment of an amount equal to the Extension Fee (as defined in the Fee Letter). 

        (b)    No Obligation to Extend Facility Termination Date.    Notwithstanding any other provision of this
Section 3.05 or otherwise herein, neither Buyer nor any of its Affiliates shall be under any obligation to extend the Facility Termination Date. 

        Section 3.06    Payment of Price Differential.    

        (a)   Notwithstanding
that Seller and Buyer intend that the Transactions hereunder be sales to Buyer of the Purchased Assets, Seller shall pay to Buyer an amount equal to the
accrued Price Differential of each Transaction through but not including the Payment Calculation Date (each such payment, a "Periodic Advance Repurchase
Payment") on each Payment Date less any portion thereof previously paid, if any. Buyer shall deliver to Seller, via Electronic Transmission, notice of the required Periodic
Advance Repurchase Payment, and a detailed calculation thereof, on or prior to the fifth (5th) Business Day preceding each Payment Date. If Seller fails to make all or part of the
Periodic Advance Repurchase Payment by 5:00 p.m., New York City time, on the Payment Date, Seller shall be obligated to pay to Buyer (in addition to, and together with, the Periodic Advance
Repurchase Payment) interest on the unpaid amount of the Periodic Advance Repurchase Payment at a rate per annum equal to the Post-Default Rate (the "Late Payment
Fee") until the overdue Periodic Advance Repurchase Payment is received in full by Buyer. 

        (b)   If
any Seller repurchases Purchased Assets on a day other than the last day of the Eurodollar Period applicable to the related Transaction, Seller shall jointly and
severally indemnify Buyer and hold Buyer harmless from any actual losses, costs and/or expenses which Buyer sustains or incurs arising from the reemployment of funds obtained by Buyer hereunder or
from fees payable to terminate the deposits from which such funds were obtained ("Breakage Costs"), in each case for the remainder of 

32

 

the
applicable Eurodollar Period. Buyer shall deliver to Seller a statement setting forth the amount and basis of determination of any Breakage Costs in reasonable detail, it being agreed that such
statement and the method of its calculation shall be conclusive and binding upon Seller absent manifest error. This Section 3.06(b) shall survive termination of this Agreement and repurchase of
all Purchased Assets subject to Transactions hereunder. 

 
 

ARTICLE IV
  
  MARGIN MAINTENANCE    
    

        Section
4.01    Margin Adjustments.    (a) If at any time the Asset Value of a Purchased Asset is determined
to be zero by the Buyer in its sole discretion (including by operation of the definition of "Asset Value"), then Buyer may, by delivery to Seller of a Margin Deficit Notice, require Seller to, at
Seller's option, no later than the Margin Correction Deadline, repurchase such Purchased Assets at the Repurchase Price. 

        (b)   If
at any time the aggregate Repurchase Price of all Mortgage Assets subject to Transactions then outstanding exceeds the Maximum Amount, then Buyer may, by delivery to
Seller of a Margin Deficit Notice, require Seller to, no later than the Margin Correction Deadline, (i) repurchase Purchased Assets at the Repurchase Price, (ii) make a payment in
reduction of the Repurchase Price or (iii) choose any combination of the foregoing, so that, after giving effect to such repurchases and payments, the aggregate Repurchase Price of all Mortgage
Assets subject to Transactions then outstanding does not exceed the Maximum Amount. 

        (c)   Except
as contemplated by Section 4.02 as a repurchase payment or as otherwise agreed in writing by Buyer, all cash transferred to Buyer pursuant to this
Section 4.01 shall be deposited in the account set forth in Section 7.01 hereof and shall be deemed to reduce the aggregate Repurchase Price with respect to all outstanding Transactions. 

        (d)   Buyer's
election, in its sole and absolute discretion, not to deliver a Margin Deficit Notice at any time a such a notice is permitted to be delivered by
Section 4.01(a) or 4.01(b) shall not in any way limit or impair Buyer's right to deliver a Margin Deficit Notice at any other time such a notice is permitted to be delivered by
Section 4.01(a) or 4.01(b). 

        Section
4.02    Margin Correction Deadline.    All transfers, repurchases and payments to be made by Seller in
satisfaction of any Margin Deficit Notice delivered pursuant to Section 4.01(a) or 4.01(b) shall be completed no later than the time that is twenty-four (24) hours after such
notice is first received by any Seller (or if such time is not during a Business Day, then no later than the same time on the next Business Day). 

 
 

ARTICLE V
  
  INCOME PAYMENTS; REQUIREMENTS OF LAW    
    

        Section
5.01    Income Payments.    Subject to the conditions set forth below, Seller shall be entitled to receive an
amount equal to all Income paid or distributed on or in respect of the Purchased Assets that is not otherwise received by any Seller, to the full extent it would be so entitled if the Mortgage Assets
had not been sold to Buyer. Notwithstanding the foregoing, each Seller hereby agrees to instruct each applicable trustee, Servicer or other party acting as paying agent with respect to the related
Eligible Asset, to transfer all Income with respect to the Purchased Asset directly to Buyer for deposit into the Collection Account within two (2) Business Days after receipt thereof. On each
Payment Date, any amounts on deposit in the Collection Account in respect of a Purchased Asset shall be applied as follows: first, to the payment of all
fees, expenses, and other obligations then due to Buyer and/or its 

33

 

Affiliates
pursuant to this Agreement, other than the Pricing Differential and Repurchase Price on the Purchased Assets; second, to the payment of
accrued and unpaid Pricing Differential on such Purchased Asset; third, to pay the Repurchase Price for such Purchased Asset then subject to a request
to repurchase in accordance with the terms of Section 3.04; fourth, to pay any amounts due and owing to the Buyer or any of its Affiliates under
the terms of the Repurchase Documents, fifth, to pay any amounts due and owing under the Liquidity Facility to the Administration Agent for the benefit
of Banks (as such terms are defined in the Liquidity Facility); and sixth, to the Operating Account, for such purposes as Seller shall determine in its
sole discretion; provided, that if a Margin Deficit, Default or Event of Default has occurred and is continuing, amounts on deposit in the Collection
Account shall not be transferred to the Operating Account but shall remain in the Collection Account. All investment income received with respect to the amount in the Collection Account shall be held
by Buyer for the account of Seller, subject to Buyer's liens on such amounts created under the Repurchase Documents, and shall be paid to the Operating Account in the priority stated above, provided
all amounts due and payable to Buyer or its Affiliates under the terms of the Repurchase Documents have been timely paid. 

        Section
5.02    Requirements of Law.    (a) In the event that Buyer shall at any time have determined (which
determination shall, absent manifest error, be final and conclusive and binding upon all parties hereto) that any Requirement of Law (other than with respect to any amendment made to Buyer's
certificate of incorporation and by-laws or other organizational or governing documents) or any change in the interpretation or application thereof or compliance by Buyer with any request
or directive (whether or not having the force of law) from any central bank or other Governmental Authority made subsequent to the date hereof: 

        (i)    shall
subject Buyer to any tax of any kind whatsoever with respect to this Agreement or any Transaction (excluding net income taxes) or change the basis of taxation of
payments to Buyer in respect thereof; 

        (ii)   shall
impose, modify or hold applicable any reserve, special deposit, compulsory loan or similar requirement against assets held by, deposits or other liabilities in or
for the account of, advances, or other extensions of credit by, or any other acquisition of funds by, any office of Buyer which is not otherwise included in the determination of the Eurodollar Rate
hereunder; 

        (iii)  shall
impose on Buyer any other condition; 

and
the result of any of the foregoing is to increase the cost to Buyer, by an amount which Buyer deems in good faith to be material, of entering, continuing or maintaining any Transaction or to
reduce any amount due or owing hereunder in respect thereof by an amount which Buyer determines in good faith to be material, then, in any such case, Seller shall promptly pay Buyer such additional
amount or amounts as calculated by Buyer in good faith as will compensate Buyer for such increased cost or reduced amount receivable. 

        (b)   In
the event that Buyer shall at any time have determined (which determination shall, absent manifest error, be final and conclusive and binding upon all parties hereto)
that the adoption of or any change in any Requirement of Law (other than with respect to any amendment made to Buyer's certificate of incorporation and by-laws or other organizational or
governing documents) regarding capital adequacy or in the interpretation or application thereof or compliance by Buyer or any corporation controlling Buyer with any request or directive regarding
capital adequacy (whether or not having the force of law) from any Governmental Authority made subsequent to the date hereof shall have the effect of reducing the rate of return on Buyer's or such
corporation's capital as a consequence of its obligations hereunder to a level below that which Buyer or such corporation could have achieved but for such adoption, change or compliance (taking into
consideration Buyer's or such corporation's policies with respect to capital adequacy) by an amount deemed by Buyer in good faith to be material, then from time to time, Seller shall promptly pay to
Buyer such additional amount or amounts as will compensate Buyer for such reduction. 

34

 

        (c)   All
payments made by any Seller to Buyer shall be free and clear of, and without deduction or withholding for, any taxes;  provided, however, that if any Seller
shall be required by law to deduct or withhold any taxes from any
sums payable to Buyer, then Seller shall (A) make such deductions or withholdings and pay such amounts to the relevant authority in accordance with applicable law, (B) pay to Buyer the
sum that would have been payable had such deduction or withholding not been made, and (C) at the time the Price Differential is paid, pay to Buyer all additional amounts as specified by Buyer
to preserve the after-tax yield Buyer would have been received had such tax not been imposed. 

        (d)   If
Buyer becomes entitled to claim any additional amounts pursuant to this Section 5.02, it shall promptly notify each affected Seller of the event by reason of
which it has become so entitled. A certificate as to any additional amounts payable pursuant to this Section 5.02 submitted by Buyer to an affected Seller shall be conclusive in the absence of
manifest error. 

 
 

ARTICLE VI
  
  SECURITY INTEREST    
    

        Section
6.01    Security Interest.    (a) Each of the following items or types of property, whether now owned
or hereafter acquired, now existing or hereafter created and wherever located, is hereinafter referred to as (the "Purchased Items"): all Mortgage
Assets, all rights under each Purchase Agreement (but not the obligations thereunder), all Mortgage Asset Files, including without limitation all promissory notes, all Servicing Records relating to
the Mortgage Assets, all Servicing Agreements relating to the Mortgage Assets and any other collateral pledged or otherwise relating to such Mortgage Assets, together with all files, documents,
instruments, surveys, certificates, correspondence, appraisals, computer programs, computer storage media, accounting records and other books and records relating thereto, all mortgage guaranties and
insurance (issued by governmental agencies or otherwise) and any mortgage insurance certificate or other document evidencing such mortgage guaranties or insurance relating to any Mortgage Asset or any
other document held pursuant to Section 6.01(c), all servicing fees to which such the applicable Seller is entitled and servicing and other rights relating to the Mortgage Assets, all Servicer
Accounts established pursuant to any Servicing Agreement and all amounts on deposit therein, from time to time, all Purchase Agreements or other agreements or contracts relating to, constituting, or
otherwise governing, any or all of the foregoing to the extent they relate to the Purchased Assets including the right to receive principal and interest payments with respect to the Purchased Assets
and the right to enforce such payments, the Controlled Accounts and all monies and investment property from time to time on deposit in, or credited to, the Controlled Accounts, all Interest Rate
Protection Agreements, if any, all Equity Interests in any Additional Sellers formed and made parties hereto pursuant to Section 9.01(gg), [any and all "Collateral" (as such term is
used and defined in the Liquidity Facility)], all "general intangibles", "accounts", "chattel paper", "deposit accounts", "instruments" and "investment property" as defined in the UCC
relating to or constituting any and all of the foregoing, and any and all replacements, substitutions, distributions on or proceeds of any and all of the foregoing. 

        (b)   Seller
and Buyer intend that the Transactions hereunder be sales to Buyer of the Purchased Assets and not loans from Buyer to Seller secured by the Purchased Assets.
However, in order to preserve Buyer's rights under this Agreement in the event that a court or other forum recharacterizes the Transactions hereunder as loans and as security for the performance by
each Seller of all of Seller's obligations to Buyer hereunder and the Transactions entered into hereunder ("Repurchase Obligations") and Seller-Related
Obligations, each Seller hereby assigns, pledges and grants a security interest in all of its right, title and interest in, to and under the Purchased Items and the Purchased Assets to Buyer to secure
the Repurchase Obligations and Seller-Related Obligations, including without limitation the repayment of all amounts owing to Buyer hereunder. Each Seller agrees to mark its computer records and files
to the extent practicable to evidence the interests granted to Buyer hereunder. All Purchased 

35

 

Items
shall secure the payment of all obligations of each Seller now or hereafter existing under this Agreement, including, without limitation, each Seller's obligation to repurchase Purchased Assets,
or if such obligation is so recharacterized as a loan, to repay such loan, for the Repurchase Price and to pay any and all other amounts owing to Buyer hereunder. 

        (c)   Pursuant
to the Custodial Agreement, the Custodian shall hold the Mortgage Asset Files as exclusive bailee and agent for Buyer pursuant to the terms of the Custodial
Agreement and shall deliver to Buyer Trust Receipts each to the effect that the Custodian has reviewed such Mortgage Asset Files in the manner and to the extent required by the Custodial Agreement and
identifying any deficiencies in such Mortgage Asset Files as so reviewed. 

        (d)   With
respect to any portion of the Purchased Items which consist of "securities" or "security entitlements" (as defined in the UCC), (x) in the case of any
security represented by a "security certificate" (within the meaning of the UCC), the Custodian shall hold such security certificate, registered in the name of the Custodian or indorsed to the
Custodian in blank (in the case of a security in "registered form" (within the meaning of the UCC)) and (y) in the case of a security entitlement, cause the relevant "securities intermediary"
(as defined in the UCC) to indicate by book-entry the credit thereof to a "securities account" (as defined in the UCC), as to which the Custodian is the "entitlement holder" (as defined in
the UCC). 

        (e)   In
addition to and without limiting the generality of the foregoing, each Seller hereby grants to Buyer a security interest in each Interest Rate Protection Agreement
relating to any Purchased Assets. 

        Section
6.02    Release of Security Interest.    Upon satisfaction of the Repurchase Obligations and the Seller-
Related Obligations, Buyer shall reconvey the Purchased Assets to the applicable Seller and release its security interest therein. 

 
 

ARTICLE VII
  
  PAYMENT, TRANSFER AND CUSTODY    
    

        Section
7.01    Payment, Transfer and Custody.    (a) Unless otherwise mutually agreed in writing, all
transfers of funds to be made by Seller hereunder shall be made in Dollars, in immediately available funds, without deduction, set-off or counterclaim, to Buyer, in accordance with the
wiring instructions set forth on Schedule 2 hereto, not later than 3:00 p.m., New York City time, on the date on which such payment shall
become due (and each such payment made after such time shall be deemed to have been made on the next succeeding Business Day). Each Seller acknowledges that it has no rights of withdrawal from the
foregoing account. 

        (b)   On
the Purchase Date for each Transaction, ownership of the Purchased Assets shall be transferred to Buyer or its designee (including the Custodian) against the
simultaneous transfer of the Purchase Price by Buyer to Seller, in accordance with the wiring instructions set forth on Schedule 2 hereto, not
later than 6:00 p.m., New York City time, simultaneously with the delivery by the Custodian to the Buyer of the Trust Receipts with respect to the Purchased Assets relating to each Transaction.
The applicable Seller hereby sells, transfers, conveys and assigns to Buyer or its designee (including the Custodian), subject to the terms of this Agreement, all the right, title and interest of
Seller in and to the Purchased Assets together with all right, title and interest in and to the proceeds of any related Purchased Items. 

        (c)   In
connection with such sale, transfer, conveyance and assignment, on or prior to each Purchase Date, Seller shall deliver or cause to be delivered and released to Buyer
or its designee (including the Custodian) the documents identified in the Custodial Agreement. 

36

 

        (d)   Any
Mortgage Asset Files not delivered to Buyer or its designee (including the Custodian) are and shall be held in trust by the applicable Seller or its designee for the
benefit of Buyer as the owner thereof. The applicable Seller or its designee shall maintain a copy of the Mortgage Asset File and the originals of the Mortgage Asset File not delivered to Buyer or its
designee (including the Custodian). The possession of the Mortgage Asset File by the applicable Seller or its designee is at the will of Buyer for the sole purpose of servicing the related Purchased
Asset, and such retention and possession by Seller or its designee is in a custodial capacity only. Each Mortgage Asset File retained or held by the applicable Seller or its designee shall be
segregated on Seller's books and records, to the extent possible, from the other assets of Seller or its designee and the books and records of Seller or its designee shall be marked appropriately to
reflect clearly the sale of the related Purchased Asset to Buyer. The applicable Seller or its designee shall release its custody of the Mortgage Asset File only in accordance with written
instructions from Buyer, unless such release is required as incidental to the servicing of the Purchased Assets or is in connection with a repurchase of any Purchased Asset by Seller. 

 
 

ARTICLE VIII
  
  SELLER REPRESENTATIONS AND WARRANTIES    
    

        Section
8.01    Seller Representations and Warranties.    Each Seller represents and warrants to Buyer that as of the
Purchase Date for the purchase of any Purchased Assets by Buyer from Seller and as of the date of this Agreement and any Transaction hereunder and, except where any such representation or warranty is
expressly stated to have been made as of a specific date, at all times while the Repurchase Documents and any Transaction hereunder is in full force and effect: 

        (a)    Acting as Principal.    Seller will engage in such Transactions as principal (or, if agreed in writing in
advance of any Transaction by the other party hereto, as agent for a disclosed principal). 

        (b)    Solvency.    Neither the Repurchase Documents nor any Transaction thereunder are entered into in contemplation
of insolvency or with intent to hinder, delay or defraud any of Seller's creditors. The transfer of the Mortgage Assets subject hereto and the obligation to repurchase such Mortgage Assets is not
undertaken with the intent to hinder, delay or defraud any of Seller's creditors. As of the Repurchase Date, Seller is not insolvent within the meaning of 11 U.S.C. Section 101(32) or any
successor provision thereof and the transfer and sale of the Mortgage Assets pursuant hereto and the obligation to repurchase such Mortgage Asset (i) will not cause the liabilities of Seller to
exceed the assets of Seller, (ii) will not result in Seller having unreasonably small capital, and (iii) will not result in debts that would be beyond Seller's ability to pay as the same
mature. Seller received reasonably equivalent value in exchange for the transfer and sale of the Purchased Assets and Purchased Items subject hereto. No petition in bankruptcy has been filed against
Seller in the last ten (10) years, and Seller has not in the last ten (10) years made an assignment for the benefit of creditors or taken advantage of any Debtors Relief Laws. 

        (c)    No Broker.    (i) Seller has not engaged the services of, or otherwise dealt with, any broker,
investment banker, agent, or other person, except for Buyer (or an Affiliate of Buyer) in connection with this Agreement or any other Repurchase Document or any Transaction or other matter related
thereto and (ii) no brokerage commission or other similar compensation is payable in connection with this Agreement or any other Repurchase Document or any Transaction or other matter related
thereto. 

        (d)    Ability to Perform.    Seller does not believe, nor does it have any reason or cause to believe, that it cannot
perform each and every covenant contained in the Repurchase Documents applicable to it to which it is a party. 

        (e)    No Margin Deficit; No Defaults.    No Margin Deficit exists and no Default or Event of Default has occurred and
is continuing hereunder. 

37

 

        (f)    Legal Name, Good Standing; Organizational Identification Number; Authority, Qualification to do Business; Compliance with
Law.    

        (i)    [Seller]'s
exact legal name is [    ]; [Additional Seller]'s exact legal name is
[    ]. [Seller] is a [limited liability company/corporation], duly organized, validly existing and in good standing
under the laws of the State of [    ]; [Additional Seller] is a [limited liability company/corporation], duly
organized, validly existing and in good standing under the laws of the State of [    ]. 

        (ii)   [Seller]'s
organizational identification number is [    ]; [Additional Seller]'s
organizational identification number is [    ]. 

        (iii)  Seller
has the requisite corporate, partnership or limited liability company power and authority, as the case may be, to own its property and assets and to transact
the business in which it is engaged and presently proposes to engage. Seller is qualified to do business and is in good standing in all other jurisdictions in which the nature of the business
conducted by it makes such qualification necessary, except where failure so to qualify could not be reasonably likely (either individually or in the aggregate) to have a Material Adverse Effect. 

        (iv)  Seller
is in compliance with all Requirements of Law except to the extent that the failure to comply therewith could not, in the aggregate, reasonably be expected to
have a Material Adverse Effect. 

        (g)    Financial Condition; No Material Adverse Change.    Seller has heretofore furnished to Buyer a copy of its most
recent quarterly balance sheet and the related statement of income and cash flows, certified by a Responsible Officer of the Parent to be true and correct; such financial statements are true and
correct, fairly present the consolidated financial condition of Seller and its Subsidiaries as of such date and have been prepared in accordance with Tax Based Accounting Principles. Since the date of
the most recent financial statements delivered to Buyer, no change having a Material Adverse Effect has occurred. 

        (h)    No Litigation.    As of the date of this Agreement and as of the Purchase Date for the purchase of any
Purchased Assets hereunder, there are no actions, suits, investigations or legal, equitable, arbitration or administrative proceedings pending, or to the knowledge of Seller threatened, against Seller
as to which there is a reasonable possibility of an adverse determination that would have a Material Adverse Effect. To the extent the representations and warranties in this Section 8.01 shall
be remade as of any date subsequent to the date hereof, Seller shall be deemed to represent that as of such subsequent date, there are no actions, suits, investigations or legal, equitable,
arbitration or administrative proceedings pending, or to the knowledge of Seller, threatened, against Seller which have not been disclosed to Buyer in writing and as to which there is a reasonable
possibility of an adverse determination that would have a Material Adverse Effect. 

        (i)    No Conflicts or Consents.    Neither the execution and delivery of this Agreement and the other Repurchase
Documents by Seller, nor the consummation of any of the transactions by it herein or therein contemplated, nor compliance with the terms and provisions hereof or with the terms and provisions thereof,
will contravene or conflict with any provision of law, statute, or regulation to which Seller is subject or any material judgment, license, order, or permit applicable to Seller or contravene or
conflict with or result in the creation or imposition of (or the obligation to create or impose) any Lien upon any of the property or assets of Seller pursuant to the terms of any indenture, mortgage,
deed of trust, or other agreement or instrument to which Seller is a party or by which Seller may be bound, or to which Seller may be subject, other than Liens created pursuant to the Repurchase
Documents. No consent, approval, authorization, or order of any court or Governmental Authority or third party is required in connection with the execution and delivery by Seller of the Repurchase
Documents to which it is a party or to consummate the transactions contemplated hereby or thereby which has not already been obtained. 

38

 

        (j)    Authorization, Power and Enforceability.    Seller has all necessary corporate or other power, authority and
legal right to execute, deliver, and perform under this Agreement and each of the other Repurchase Documents executed by it; Seller is duly authorized to execute, deliver, and perform under this
Agreement and the other Repurchase Documents to which it is a party and is and will continue to
be duly authorized to perform under this Agreement and such other Repurchase Documents; and each Repurchase Document has been duly executed and delivered by Seller, as applicable, and constitutes a
legal, valid and binding obligation of Seller enforceable against Seller in accordance with its terms. 

        (k)    Governmental Approvals.    No order, consent, approval, license, authorization or validation of, or filing,
recording or registration with, or exemption by, any Governmental Authority is required to authorize, or is required in connection with, (i) the execution, delivery and performance of any
Repurchase Document to which Seller is or will be a party, (ii) the legality, validity, binding effect or enforceability of any such Repurchase Document against Seller or (iii) the
consummation of the transactions contemplated by this Agreement (other than the filing of certain financing statements in respect of certain security interests). 

        (l)    Use of Proceeds; Margin Regulations.    All proceeds of each Transaction shall be used by Seller for purposes
permitted under Seller's Governing Documents, provided that no part of the proceeds of any Transaction will be used by Seller to purchase or carry any Margin Stock or to extend credit to others for
the purpose of purchasing or carrying any Margin Stock. Neither the entering into of any Transaction nor the use of any proceeds thereof will violate, or be inconsistent with, any provision of
Regulation T, U or X of the Board of Governors of the Federal Reserve System. 

        (m)    Taxes.    Seller and each Subsidiary thereof has filed all required federal income tax returns and all other
material tax returns, domestic and foreign, required to be filed by it and has paid all material taxes (including mortgage recording taxes), assessments, fees, and other governmental charges payable
by it, or with respect to any of their properties, which have become due, and income or franchises have been paid prior to the time that such taxes could give rise to a lien thereon or are being
contested in good faith by appropriate proceedings and appropriate reserves therefor have been established in accordance with GAAP. Seller and each Subsidiary thereof has paid, or has provided
adequate reserves (in the good faith judgment of the management of Seller) for the payment of, all federal, state and foreign income taxes applicable for all prior fiscal years and for the current
fiscal year to date. There is no material action, suit, proceeding, investigation, audit or claim now pending or, to the knowledge of Seller, threatened by any authority regarding any taxes relating
to Seller or any Subsidiary thereof which is material or not being contested in good faith. Neither Seller nor any Subsidiary thereof has entered into any agreement or waiver or been requested to
enter into any agreement or waiver extending any statute of limitations relating to the payment or collection of taxes, or is aware of any circumstances that would cause the taxable years or other
taxable periods of Seller or any Subsidiary thereof not to be subject to the normally applicable statute of limitations. 

        (n)    Government Regulation.    Neither Seller nor any Subsidiary thereof is (i) an "investment company" or a
company "controlled" by an "investment company," within the meaning of the Investment Company Act of 1940, as amended; (ii) a "holding company" or a "subsidiary company" of a "holding company"
or an "affiliate" of either a "holding company" or a "subsidiary company" within the meaning of the Public Utility Holding Company Act of 1935, as amended; or (iii) subject to any other federal
or state law or regulation which purports to restrict or regulate its ability to borrow money. 

        (o)    Purchased Assets.    

        (i)    As
of the date hereof, Seller has not assigned, pledged, or otherwise conveyed or encumbered any Mortgage Asset (or any interest therein) to any other Person, and
immediately prior to the sale of such Mortgage Asset to Buyer, Seller was the sole owner of such Mortgage 

39

 

Asset
and had good and marketable title thereto, free and clear of all Liens, in each case except for Liens to be released simultaneously with the sale to Buyer hereunder. 

        (ii)   The
provisions of this Agreement and the related Confirmation are effective to either constitute a sale of Purchased Items to Buyer or to create in favor of Buyer a
legal, valid and enforceable security interest in all right, title and interest of Seller in, to and under the Purchased Items. 

        (iii)  Upon
receipt by the Custodian of each Mezzanine Note or Junior Interest Note, endorsed in blank by a duly authorized officer of Seller, either a purchase shall have
been completed by Buyer of such Mezzanine Note or Junior Interest Note, as applicable, or Buyer shall have a valid and fully perfected first priority security interest in all right, title and interest
of Seller in the Purchased Items described therein. 

        (iv)  Each
of the representations and warranties made in respect of the Purchased Assets pursuant to  Schedule 1(a)–1(g), as applicable, are true, complete and correct. 

        (v)   Upon
the filing of financing statements on Form UCC-1 naming Buyer as "Secured Party", Seller as
"Debtor" and describing the Purchased Items, in the jurisdictions and recording offices listed on  Exhibit D attached hereto, the security interests
granted hereunder in that portion of the Purchased Items which can be perfected by filing under
the Uniform Commercial Code will constitute fully perfected security interests under the Uniform Commercial Code in all right, title and interest of Seller in, to and under such Purchased Items. 

        (vi)  Upon
execution and delivery of the Account Control Agreement, Buyer shall either be the owner of, or have a valid and fully perfected first priority security interest
in, the "investment property" and all "deposit accounts" (each as defined in the Uniform Commercial Code) comprising Purchased Items. 

        (p)    Principal Place of Business; Location of Records; Federal Tax ID.    The principal place of business of Seller
is located at [    ]. All of the books and records of Seller are and will be kept at [    ] and will continue to be at such location
(unless the Seller
notifies Buyer in writing at least thirty (30) days prior to the date of any change). [Seller]'s federal taxpayer's identification number is
[    ]. [Additional Seller]'s federal taxpayer's identification number is [    ]. 

        (q)    Interest Rate Protection Agreements.    Seller has entered into all Interest Rate Protection Agreements
required pursuant to Section 9.01(w) and to the actual knowledge of Seller, as of the date of this Agreement and as of the Purchase Date for the purchase of any Purchased Assets subject to an
Interest Rate Protection Agreement, each such Interest Rate Protection Agreement is in full force and effect in accordance with its terms and no default or event of default exists thereunder. 

        (r)    Servicing Agreements.    Seller has delivered to Buyer all Servicing Agreements pertaining to the Mortgage
Assets and to the actual knowledge of Seller, as of the date of this Agreement and as of the Purchase Date for the purchase of any Purchased Assets subject to a Servicing Agreement, each such
Servicing Agreement is in full force and effect in accordance with its terms and no default or event of default exists thereunder. 

        (s)    True and Complete Disclosure.    The information, reports, financial statements, exhibits and schedules
furnished in writing by or on behalf of Seller to Buyer in connection with the negotiation, preparation or delivery of this Agreement and the other Repurchase Documents or included herein or therein
or delivered pursuant hereto or thereto (other than with respect to the Mortgage Assets), when taken as a whole, do not contain any untrue statement of material fact or omit to state any material fact
necessary to make the statements herein or therein, in light of the circumstances under which they were made, not misleading. All written information furnished after the date hereof by or on behalf of
Seller to Buyer in connection with this Agreement and the other Repurchase Documents and the 

40

 

transactions
contemplated hereby (other than with respect to the Mortgage Assets) and thereby will be true, complete and accurate in all material respects, or (in the case of projections) based on
reasonable estimates, on the date as of which such information is stated or certified. There is no fact known to a Responsible Officer of Seller, after due inquiry, that would reasonably be expected
to have a Material Adverse Effect that has not been disclosed herein, in the other Repurchase Documents or in a report, financial statement, exhibit, schedule, disclosure letter or other writing
furnished to Buyer for use in connection with the transactions contemplated hereby or thereby. 

41

  

        (t)    No Plan Assets.    Seller is not an "employee benefit plan," as defined in Section 3(3) of ERISA,
subject to Title I of ERISA, and none of the assets of Seller constitutes or will constitute "plan assets" of one or more such plans within the meaning of 29 C.F.R.
Section 2510.3-101. In addition, (a) Seller is not a "governmental plan" within the meaning of Section 3(32) of ERISA and (b) transactions by or with Seller are
not subject to state statutes regulating investment of, and fiduciary obligations with respect to, governmental plans similar to the provisions of Section 406 of ERISA or Section 4975 of
the Internal Revenue Code currently in effect, which prohibit or otherwise restrict the transactions contemplated by this Agreement. 

        (u)    No Reliance.    Seller has made its own independent decisions to enter into each Transaction and as to whether
such Transaction is appropriate and proper for it based upon its own judgment and upon advice from such advisors (including without limitation, legal counsel and accountants) as it has deemed
necessary. Seller is not relying upon any advice from Buyer as to any aspect of the Repurchase Documents or any Transaction, including without limitation, the legal, accounting or tax treatment of
such Transactions. 

        (v)    Patriot Act.    Seller is in compliance, in all material respects, with the (i) the Trading with the
Enemy Act, as amended, and each of the foreign assets control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) and any other applicable enabling
legislation or executive order relating thereto, and (ii) the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA Patriot Act of
2001). No part of the proceeds of any Transaction will be used, directly or indirectly, for any payments to any governmental official or employee, political party, official of a political party,
candidate for political office, or anyone else acting in an official capacity, in order to obtain, retain or direct business or obtain any improper advantage, in violation of the United States Foreign
Corrupt Practices Act of 1977, as amended. 

        (w)    Insurance.    As of the date of this Agreement and as of the Purchase Date for the purchase of any Purchased
Assets hereunder, Seller has, with respect to its properties and business, insurance covering the risks, in the amounts, with the deductible or other retention amounts, and with the carriers, listed
on Schedule 4, which insurance meets the requirements of Section 9.01(y). 

        (x)    Environmental Matters.    As of the date of this Agreement and as of the Purchase Date for the purchase of any
Purchased Assets hereunder: 

        (i)    To
the best knowledge of Seller, no properties owned or leased by Seller and no properties formerly owned or leased by Seller, its predecessors, or any former
subsidiaries or predecessors thereof (the "Properties"), contain, or have previously contained, any Materials of Environmental Concern in amounts or
concentrations which constitute or constituted a violation of, or reasonably could be expected to give rise to liability under, Environmental Laws; 

        (ii)   To
the best knowledge of Seller, Seller is in compliance with all applicable Environmental Laws, and there is no violation of any Environmental Laws which reasonably
would be expected to interfere with the continued operations of Seller; 

        (iii)  Seller
has not received any notice of violation, alleged violation, non-compliance, liability or potential liability under any Environmental Law, nor does
Seller have any actual knowledge that any such notice will be received or is being threatened; 

        (iv)  To
the best knowledge of Seller, Materials of Environmental Concern have not been transported or disposed by Seller in violation of, or in a manner or to a location
which reasonably would be expected to give rise to liability under, any applicable Environmental Law, nor has Seller generated, treated, stored or disposed of at, on or under any of the Properties in
violation of, or in a manner that reasonably would be expected to give rise to liability under, any applicable Environmental Law; 

42

 

        (v)   No
judicial proceedings or governmental or administrative action is pending, or, to the knowledge of Seller, threatened, under any Environmental Law which Seller is or
will be named as a party, nor are there any consent decrees or other decrees, consent orders, administrative orders or other orders, or other administrative or judicial requirements arising out of
judicial proceedings or governmental or administrative actions, outstanding under any Environmental Law to which Seller is a party; 

        (vi)  To
the best knowledge of Seller, there has been no release or threat of release of Materials of Environmental Concern in violation of or in amounts or in a manner that
reasonably would be expected to give rise to liability under any Environmental Law for which Seller may become liable; and 

        (vii) to
the best knowledge of Seller, each of the representations and warranties set forth in the preceding clauses (i) through (vi) is true and correct with
respect to each parcel of real property owned or operated by Seller. 

        (y)    Insider.    Seller is not an "executive officer," "director," or "person who directly or indirectly or acting
through or in concert with one or more persons owns, controls, or has the power to vote more than 10% of any class of voting securities" (as those terms are defined in 12 U.S.C. § 375(b)
or in regulations promulgated pursuant thereto) of Buyer, of a bank holding company of which Buyer is a subsidiary, or of any subsidiary, of a bank holding company of which Buyer is a subsidiary, of
any bank at which Buyer maintains a correspondent account or of any lender which maintains a correspondent account with Buyer. 

        (z)    Office of Foreign Assets Control.    Seller is not a person (i) whose property or interest in property
is blocked or subject to blocking pursuant to Section 1 of Executive Order 13224 of September 23, 2001 Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten to
Commit, or Support Terrorism (66 Fed. Reg. 49079 (2001)), (ii) who engages in any dealings or transactions prohibited by Section 2 of such executive order, or to the best of Seller's
knowledge, is otherwise associated with any such person in any manner violative of Section 2 of such executive order, or (iii) on the current list of Specially Designated Nationals and
Blocked Persons or subject to the limitations or prohibitions under any other U.S. Department of Treasury's Office of Foreign Assets Control regulation or executive order. 

        (aa)    Certain Tax Matters.    Seller represents and warrants, and acknowledges and agrees, that it does not intend
to treat any Transaction or any related transactions hereunder as being a "reportable transaction" (within the meaning of United States Treasury Department Regulation
Section 1.6011-4). In the event that Seller determines to take any action inconsistent with such intention, it will promptly notify Buyer. If Seller so notifies Buyer, Seller
acknowledges and agrees that Buyer may treat each Transaction as part of a transaction that is subject to United States Treasury Department Regulation Section 301.6112-1, and Buyer
will maintain the lists and other records required by such Treasury Regulation. 

        (bb)    Fiscal Year.    The fiscal year of Seller is the calendar year. 

        (cc)    Agreements.    Seller is not a party to any agreement or instrument or subject to any restriction which could
reasonably be expected to have any Material Adverse Effect. Seller is not in default in any material respect in the performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in any agreement or instrument to which it is a party or by which Seller is bound. Seller has no material financial obligation under any agreement or instrument to which Seller is
a party or by which Borrower is otherwise bound, other than (a) obligations incurred in the ordinary course of Seller's business and (b) obligations under the Repurchase Documents. 

        (dd)    REIT.    Seller has not engaged in any material "prohibited transactions" as defined in
Section 857(b)(6)(B)(iii) and (C) of the Code. Seller for its current "tax year" (as defined in the Code) 

43

 

is
and for all prior tax years subsequent to its election to be a real estate investment trust has been entitled to a dividends paid deduction under the requirements of Section 857 of the Code
with respect to any dividends paid by it with respect to each such year for which it claims a deduction in its Form 1120-REIT filed with the United States Internal Revenue Service
for such year. 

 
 

ARTICLE IX
  
  COVENANTS    
    

        Section
9.01    Seller Covenants.    On and as of the date of this Agreement and each Purchase Date and until this
Agreement is no longer in force with respect to any Transaction, each Seller covenants that: 

        (a)    Financial Statements.    Seller shall deliver or cause to be delivered to Buyer: 

        (i)    as
soon as available and in any event within the earlier to occur of (i) ten (10) days following the filing of Parent's Form 10-Q with
the Securities and Exchange Commission, and (ii) fifty-five (55) days after the end of each fiscal quarter of Parent, the unaudited consolidated balance sheets of each Seller
and their respective Consolidated Subsidiaries for such period and the portion of the fiscal year through the end of such period, accompanied by a schedule of all contingent funding obligations and
hedging positions of each Seller and their respective Consolidated Subsidiaries and a certificate of a Responsible Officer, which certificate shall state that said consolidated financial statements
fairly present in all material respects the consolidated financial condition and results of operations of the Parent and its Consolidated Subsidiaries (and, to the extent applicable, for each Seller)
in accordance with GAAP, consistently applied, as at the end of, and for, such period (subject to normal year-end adjustments); 

        (ii)   as
soon as available and in any event within the earlier to occur of (i) ten (10) days following the filing of Parent's Form 10-K with
the Securities and Exchange Commission and (ii) one hundred (100) days after the end of each fiscal year of the Parent, the audited consolidated balance sheets of the Parent and its
Consolidated Subsidiaries as at the end of such fiscal year and the related consolidated statements of income and retained earnings and of cash flows for the Parent and its consolidated Subsidiaries
for such year, setting forth in each case in comparative form the figures for
the previous year, accompanied by an opinion thereon of independent certified public accountants of recognized national standing, which opinion shall not be qualified as to scope of audit or going
concern and shall state that said consolidated financial statements fairly present the consolidated financial condition and results of operations of the Parent and its consolidated Subsidiaries as at
the end of, and for, such fiscal year in accordance with GAAP, and a certificate of such accountants stating that, in making the examination necessary for their opinion, they obtained no knowledge,
except as specifically stated, of any Default or Event of Default; 

        (iii)  as
soon as available, and in any event within thirty (30) days after filing with the applicable taxing authority, copies of all federal and state income tax
returns and all other material tax returns, domestic and foreign, required to be filed by Seller and its respective Consolidated Subsidiaries, in each case with all supporting documentation and such
other information as may reasonably be requested by Buyer. 

        (iv)  (A)
with respect to each Mortgage Asset (not including RMBS) originated or master serviced by an Affiliate of Seller or Buyer, as soon as available, but in any event
not later than sixty (60) days after the end of each fiscal quarter of Seller, the rent roll, operating statement and aging of accounts receivable and accounts payable for each Underlying
Mortgaged Property and (B) with respect to each Mortgage Asset not originated or master serviced by an Affiliate of Seller or Buyer, Seller shall use its good faith efforts to deliver as soon
as practicable, the rent roll, 

44

 

operating
statement and aging of accounts receivable and accounts payable for each Underlying Mortgaged Property; 

        (v)   with
respect to each Mortgage Asset (not including RMBS), as soon as available, but in any event not later than sixty (60) days after the end of each fiscal
quarter of Seller, a report detailing projections of Seller with respect to such Mortgage Asset for the following six (6) month period, which shall include, in any event, a description of
Seller's internal risk rating, tenant ratings, tenant KMV ratings (if applicable) and/or surveillance of such Mortgage Asset; 

        (vi)  with
respect to each Mortgage Asset to the extent received by any Seller from the obligor under any Mortgage Asset, as soon as available, but in any event not later
than thirty (30) days after receipt thereof, the annual balance sheet with respect to such obligor; 

        (vii) with
respect to each Mortgage Asset that is CMBS, RMBS, or a Junior Interest, as soon as available but in any event not later than thirty (30) days after
receipt thereof, (i) the related monthly securitization report, if any, and (ii) within thirty (30) days after the end of each month, a copy of the standard monthly exception
report, prepared by Seller in the ordinary course of its business in respect of the related Mortgage Asset or Underlying Mortgaged Property; 

        (viii) from
time to time such other information regarding the financial condition, operations, or business of Seller as Buyer may reasonably request; and 

        (ix)  as
soon as reasonably possible, and in any event within thirty (30) days after a Responsible Officer of Seller knows, or with respect to any Plan to which Seller
or any Subsidiary thereof makes direct contributions, has reason to believe, that any of the events or conditions specified below with respect to any Plan has occurred or exists, a statement signed by
a senior financial officer of Seller setting forth details respecting such event or condition and the action, if any, that Seller or its ERISA Affiliate proposes to take with respect thereto (and a
copy of any report or notice required to be filed with or given to PBGC by Seller or an ERISA Affiliate with respect to such event or condition): 

        (A)  any
Reportable Event, or and any request for a waiver under Section 412(d) of the Code or any successor provision thereof for any Plan; 

        (B)  the
distribution under Section 4041(c) of ERISA or any successor provision thereof of a notice of intent to terminate any Plan or any action taken by Seller or an
ERISA Affiliate to terminate any Plan; 

        (C)  the
institution by PBGC of proceedings under Section 4042 of ERISA or any successor provision thereof for the termination of, or the appointment of a trustee to
administer, any Plan; and 

        (D)  the
adoption of an amendment to any Plan that would result in the loss of tax exempt status of the trust of which such Plan is a part if Seller or an ERISA Affiliate
fails to provide timely security to such Plan in accordance with the provisions of Section 401(a)(29) of the Code or Section 307 of ERISA or any successor provision thereof. 

        (b)    Certificates; Other Information.    Seller shall furnish to Buyer: 

        (i)    concurrently
with the delivery of the financial statements referred to in Sections 9.01(a)(ii) above, a certificate of the independent certified public
accountants reporting on such financial statements stating that in making the examination necessary therefore no knowledge was obtained of any Default or Event of Default caused by a failure to comply
with the requirements of Section 9.01(l)-(n) or (hh)-(mm), except as specified in such certificate; 

        (ii)   concurrently
with the delivery of the financial statements referred to in Section 9.01(a) above and with the delivery of each Confirmation, a certificate of a
Responsible Officer 

45

 

substantially
in the form of Exhibit K hereto (i) stating that, to the best of such Responsible Officer's knowledge, Seller during such
period has observed or performed all of its covenants and other agreements in all material respects, and satisfied every material condition, contained in this Repurchase Agreement and the related
documents to be observed, performed or satisfied by it, and that such Responsible Officer has obtained no knowledge of any Default or Event of Default except as specified in such certificate,
(ii) showing in detail the calculations supporting such Responsible Officer's certification of Seller's compliance with the requirements of Sections 9.01(l)-(n) or (hh)-(mm) and
(iii) showing in detail the calculations projected with respect to the requirements of Sections 9.01(l)-(n) or (hh)-(mm) for the upcoming period of four (4) fiscal quarters; 

        (iii)  as
soon as available, but in any event not later than ninety (90) days after the end of each fiscal year of Seller, a copy of the projections of Seller and the
Parent of the operating budget and cash flow budget of Seller and the Parent for the succeeding fiscal year, such projections to be accompanied by a certificate of a Responsible Officer certifying
that such projections have been prepared in good faith based upon reasonable assumptions; 

        (iv)  promptly
upon receipt thereof, copies of all reports submitted to Seller by independent certified public accountants in connection with each annual, interim or special
audit of the books and records of Seller made by such accountants, including, without limitation, any management letter commenting on Seller's internal controls submitted by such accountants to
management in connection with their annual audit; 

        (v)   within
thirty (30) days of the end of each calendar quarter, a quarterly report, which report shall include, among other items, (1) a summary of Seller's
delinquency and loss experience with respect to Mortgage Assets serviced by Seller, any Servicer or any designee of either, and (2) operating statements and the occupancy status of such
Mortgaged Property and other property level information, plus any such additional reports as Buyer may reasonably request with respect to Seller or any Servicer's servicing portfolio or pending
originations of Mortgage Assets; 

        (vi)  within
fifteen (15) days after the same are sent, copies of all financial statements and reports which Seller sends to its stockholders, and within fifteen
(15) days after the same are filed, copies of all financial statements and reports which Seller may make to, or file with, the Securities and Exchange Commission or any successor or analogous
Governmental Authority; 

        (vii) no
later than the 15th day of each month, with respect to each Purchased Asset, a Purchased Asset Data Summary, substantially in the form of  Exhibit L, properly completed; and 

        (viii) promptly,
any report or material notice received by Seller with respect to any Purchased Asset and such additional financial and other information as Buyer may from
time to time reasonably request. 

        (c)    Litigation.    Seller will promptly, and in any event within ten (10) Business Days after service of
process on any of the following, give to Buyer notice of all litigation, actions, suits, arbitrations, investigations (including, without limitation, any of the foregoing which are pending or
threatened in writing) or other legal or arbitrable proceedings affecting Seller or any Subsidiary thereof or affecting any of the Property of any of them before any Governmental Authority that
(i) questions or challenges the validity or enforceability of any of the Repurchase Documents or any action to be taken in connection with the transactions contemplated hereby,
(ii) makes a claim or claims in an aggregate amount greater than $1,000,000 (not covered by insurance), or (iii) which, individually or in the aggregate, if adversely determined, could
be reasonably likely to have a Material Adverse Effect. 

46

 

        (d)    Existence, etc.    Seller shall: 

        (i)    continue
to engage in business of the same general type as now conducted by it or otherwise as approved by Buyer prior to the date hereof and maintain and preserve its
legal existence and all of its material rights, privileges, licenses and franchises necessary for the operation of its business (including, without limitation, preservation of all lending licenses
held by Seller and of Seller's status as a "qualified transferee" (however denominated) under all documents which govern the Purchased Assets and any applicable inter-creditor arrangement);  provided,
that nothing in this Section 9.01(d)(i) shall prohibit any transaction expressly permitted under Section 9.01(e); 

        (ii)   comply
with all Contractual Obligations and with the requirements of all applicable laws, rules, regulations and orders of Governmental Authorities (including, without
limitation, all environmental laws) if failure to comply with such requirements would be reasonably likely (either individually or in the aggregate) to have a Material Adverse Effect; 

        (iii)  keep
adequate records and books of account, in which complete entries will be made in accordance with GAAP consistently applied; 

        (iv)  not
(i) cause or permit any change to be made in its name, organizational identification number, identity or corporate structure, each as described in
Section 8.01(f) or (ii) change its jurisdiction of organization, unless it shall have provided Buyer thirty (30) days' prior written notice of such change and shall have first
taken all action required by Buyer for the purpose of perfecting or protecting the lien and security interest of Buyer established hereunder; 

        (v)   pay
and discharge all taxes, assessments and governmental charges or levies imposed on it or on its income or profits or on any of its Property prior to the date on
which penalties attach thereto, except for any such tax, assessment, charge or levy the payment of which is being contested in good faith and by proper proceedings and against which adequate reserves
are being maintained; and 

        (vi)  permit
representatives of Buyer, upon reasonable notice (unless a Default shall have occurred and is continuing, in which case, no prior notice shall be required),
during normal business hours, to examine, copy (at Buyer's expense) and make extracts from its books and records, to inspect any of its Properties, and to discuss its business and affairs with its
officers, all to the extent reasonably requested by Buyer. 

        (e)    Prohibition of Fundamental Changes; Fiscal Year and Accounting Method.    Seller shall not enter into any
transaction of merger or consolidation or amalgamation, or liquidate, wind up or dissolve itself (or suffer any liquidation, winding up or dissolution), sell all or substantially all of its assets or
acquire or form any Subsidiaries (other than the Subsidiaries set forth on Schedule 5 hereto);  provided, that Seller may merge or consolidate with
(A) any wholly owned subsidiary of Seller or (B) any other Person if Seller is the
surviving corporation, in either case, as long as, after giving effect thereto, no Default or Event of Default would exist hereunder. Seller shall not change its respective fiscal year or method of
accounting without the consent of Buyer and Seller shall give Buyer at least fifteen (15) days prior written notice of any such requested change, which notice shall include a detailed
explanation of the changes intended to be made and pro forma financial statements demonstrating the impact thereof. 

        (f)    Margin Deficit.    If at any time there exists a Margin Deficit, Seller shall cure same in accordance with
Section 4.01. 

        (g)    Notices.    Seller shall give notice to Buyer: 

        (i)    promptly
upon receipt by Seller of notice or knowledge of the occurrence of any Default or Event of Default; 

47

 

        (ii)   with
respect to any Purchased Asset, promptly upon receipt by Seller of any principal prepayment (in full or partial) of such Purchased Asset; 

        (iii)  with
respect to any Purchased Asset hereunder, promptly upon receipt of notice or knowledge by or of Seller that the Underlying Mortgaged Property has been materially
damaged by waste, fire, earthquake or earth movement, flood, tornado or other casualty, or otherwise damaged so as to materially and adversely affect the Asset Value of such Purchased Asset; and 

        (iv)  promptly
upon receipt of notice or knowledge by or of Seller of (i) any material default related to any Purchased Item, (ii) any Lien or security interest
on, or claim asserted against, any Purchased Item or (iii) any event or change in circumstances which would reasonably be expected to have a Material Adverse Effect. 

Each
notice pursuant to this Section shall be accompanied by a statement of a Responsible Officer of Seller setting forth details of the occurrence referred to therein and stating what action Seller
has taken or proposes to take with respect thereto. 

        (h)    Transactions with Affiliates.    Seller may enter into any transaction with an Affiliate;  provided that such transaction is
disclosed in writing in advance to Buyer and such transaction is upon fair and reasonable terms no less favorable to
Seller than it would obtain in a comparable arm's length transaction with a Person which is not an Affiliate; provided,  further, that in no event shall
Seller transfer to Buyer hereunder any Mortgage Asset acquired by Seller from an Affiliate of Seller unless a
Non-Consolidation Opinion and a True Sale Opinion have been delivered to Buyer prior to such sale. 

        (i)    Limitation on Liens.    Immediately upon notice to Seller of a Lien or any circumstance which if adversely
determined would be reasonably likely to give rise to a Lien (other than in favor of the Buyer) on the Purchased Items, Seller will defend the Purchased Items against, and will take such other action
as is necessary to remove, any Lien, security interest or claim on or to the Purchased Items (other than any security interest created under this Agreement), and Seller will defend the right, title
and interest of Buyer in and to any of the Purchased Items against the claims and demands of all persons whomsoever. 

        (j)    Limitations on Indebtedness, Guarantees and Contingent Liabilities.    Seller shall not create, incur, assume
or suffer to exist any Indebtedness, Guarantees or Contingent Liabilities, except Indebtedness of Seller to Buyer or an Affiliate thereof. 

        (k)    Limitation on Distributions.    Seller shall not declare or make any payment on account of, or set apart assets
for, a sinking or other analogous fund for the purchase, redemption, defeasance, retirement or other acquisition of any equity or partnership interest of Seller, whether now or hereafter outstanding,
or make any other distribution in respect thereof, either directly or indirectly, whether in cash or property or in obligations of Seller, except, so long as no Default, Event of Default or Margin
Deficit shall have occurred and be continuing, Seller may make such payments solely to the extent necessary to preserve the status of the Parent as a REIT and to make payments subject to the following
restrictions: (1) during the first year following the Effective Date of this Agreement, Seller may make payments in
an amount equal to (a) 103% of FFO only if a dividend payment is made to reimburse certain original shareholders for expenses associated with the capitalization of Parent, or (b) 100% of
FFO if no such dividend payment is made, and (2) after the first year following the Effective Date, Seller may make payments in an amount equal to 100% of FFO. 

        (l)    Weighted Average of Purchase Rate and LTV.    No Seller shall permit (i) the weighted average Purchase
Rate of all Mortgage Assets to exceed 85.0% or (ii) the weighted average LTV of all Mortgage Assets multiplied by the weighted average Purchase Rate of all Mortgage Assets to exceed 80.0%. 

48

 

        (m)    Interest Coverage.    Seller shall not permit, during any Test Period, the ratio of (i) the sum of
Consolidated Adjusted EBITDA of Seller at any time such Test Period to (ii) Consolidated Interest Expense of Seller at any time such Test Period to be less than 1.50 to 1.00. 

        (n)    Maintenance of Ratio of Consolidated Total Indebtedness to Consolidated Total Assets.    Seller (on a
consolidated basis) shall not permit the ratio of Consolidated Total Indebtedness of Seller to Consolidated Total Assets of Seller at any time to be greater than 0.85 to 1.00. 

        (o)    Positive Net Income.    Parent's Net Income shall be positive at all times following the first anniversary of
the Effective Date of this Agreement. 

        (p)    Servicer; Servicing Tape.    Seller shall cause each Servicer to provide to Buyer and to the Custodian via
Electronic Transmission, a remittance report on a monthly basis by no later than the 15th day of each month (the "Reporting Date")
containing servicing information, including without limitation those fields reasonably requested by Buyer from time to time, on a loan-by-loan basis and in the aggregate, with
respect to the Purchased Assets serviced hereunder by Seller or any Servicer for the month (or any portion thereof) prior to the Reporting Date (such remittance report, an
"Asset Tape"). To the extent it has control, Seller shall not cause or permit any Mortgage Assets to be serviced by any servicer other than a Qualified
Servicer. 

        (q)    Required Filings.    Seller shall promptly provide Buyer with copies of all material documents which Seller or
any Subsidiary of Seller is required to file with any regulatory body in accordance with its regulations. 

        (r)    Remittance of Prepayments.    Seller shall remit or cause to be remitted to Buyer, with sufficient detail via
Electronic Transmission to enable Buyer to appropriately identify the Mortgage Asset to which any
amount remitted applies, all full or partial principal prepayments on any Purchased Asset that Seller or Servicer has received no later than five (5) Business Days following the date such
prepayment was received. 

        (s)    Mandatory Prepayments.    If at any time a Purchased Asset ceases to be an Eligible Asset, then the principal
amount outstanding under this Agreement for such Purchased Asset shall become immediately due and payable and Seller shall be required to make a mandatory principal prepayment in an amount equal to
the Repurchase Price plus any other amounts payable with respect to such Purchased Asset within five (5) Business Days of the first date on which the Purchased Asset was no longer an Eligible
Asset. 

        (t)    Custodial Agreement and Account Control Agreement.    Seller shall maintain each of the Custodial Agreement and
Account Control Agreement in full force and effect and shall not amend or modify either of the Custodial Agreement or the Account Control Agreement or waive compliance with any provisions thereunder
without the prior written consent of Buyer. 

        (u)    Inconsistent Agreements.    Seller shall not, and shall not permit any of its Subsidiaries to, directly or
indirectly, enter into any material agreement containing any material provision which would be violated or breached by any Transaction hereunder or by the performance by Seller of its obligations
under any Repurchase Document. 

        (v)    Escrow Imbalance.    Seller shall, no later than five (5) Business Days after learning (from any source)
of any material imbalance in any escrow account, fully and completely correct and eliminate such imbalance including, without limitation, depositing its own funds into such account to eliminate any
overdrawal or deficit. 

        (w)    Hedging.    Seller shall enter into Interest Rate Protection Agreement(s) selected by Seller and acceptable to
Buyer with respect to all Purchased Assets which have a fixed rate of interest or yield and are intended for securitization and Seller shall enter into such other Interest Rate Protection Agreement(s)
with respect to any or all of the Purchased Assets as Buyer may from time to time 

49

 

request.
Seller shall take all such steps as Buyer deems necessary to perfect the security interest granted in each Interest Rate Protection Agreement pursuant to Section 6.01(e) of this
Agreement. 

        (x)    Separateness.    Seller shall (a) own no assets, and will not engage in any business, other than the
assets and transactions specifically contemplated by this Agreement, which assets and transactions specifically contemplated by this Agreement shall include, without limitation, the origination,
acquisition, ownership, management, servicing, administration, operation, collection, enforcement, development, improvement, leasing, exchange, participation, securitization, sale, transfer and other
disposition of all of any portion of the Purchased Assets (including the Underlying Mortgaged Property and any business interests related thereto), personal property necessary for and used or to be
used in connection with its ownership or operation of the Purchased Assets (including the Underlying Mortgaged Property and any business interests related thereto) or any portion thereof, cash, its
interest under any associated Interest Rate Protection Agreement, this Agreement, and any and all agreements, documents, insurance policies, reports and other instruments in any way relating to the
Purchased Assets (including the Underlying Mortgaged Property and any business interests related thereto) or any portion thereof; (b) not incur any indebtedness or obligation, secured or
unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), other than (i) pursuant to this Agreement, and under the agreements, documents, insurance
policies, reports and other instruments evidencing, securing or in any other way related to the Purchased Assets (including the Underlying Mortgaged Property and any business interests related
thereto), (ii) in connection with customary representations, warranties, indemnities and agreements in connection with the origination, acquisition, ownership, management, servicing,
administration, operation, collection, enforcement, financing, development, improvement, leasing, exchange, participation, securitization, sale, transfer or other disposition of the Purchased Assets
(including the Underlying Mortgaged Property and any business interests related thereto), and (iii) under zoning and other governmental regulations, rules, prohibitions and ordinances and
existing and proposed covenants, easements and other matters of public record governing, burdening, benefiting or otherwise affecting any real property constituting or underlying any of the Purchased
Assets (including the Underlying Mortgaged Property and any business interests related thereto); (c) not make any loans or advances to any third party, and shall not acquire obligations or
securities of its affiliates; (d) pay its debts and liabilities (including, as applicable, shared personnel and overhead expenses) only from its own assets; (e) comply with the
provisions of its organizational documents; (f) do all things necessary to observe organizational formalities and to preserve its existence, and will not amend, modify or otherwise change its
organizational documents, or suffer same to be amended, modified or otherwise changed, without the prior written consent of Buyer, not to unreasonably withheld; (g) maintain all of its books,
records, financial statements and bank accounts separate from those of its Affiliates (except that such financial statements may be consolidated to the extent consolidation is required under GAAP
consistently applied as in effect from time to time or as a matter of law) and file its own tax returns (except to the extent that either consolidation is required or permitted under applicable law or
it is a tax disregarded entity not required to file tax returns under applicable law); (h) be, and at all times will hold itself out to the public as, a legal entity separate and distinct from
any other entity (including any Affiliate), shall correct any known misunderstanding regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any
of its Affiliates as a division or part of the other and shall maintain and utilize separate invoices and checks; (i) maintain adequate capital for the normal obligations reasonably foreseeable
in a business of its size and character and in light of its contemplated business operations; (j) not engage in or suffer any change of ownership, dissolution, winding up, liquidation,
consolidation or merger in whole or in part, except as otherwise permitted in accordance herewith; (k) not commingle its funds or other assets with those of any Affiliate or any other Person;
(l) maintain its assets in such a manner that it will not be costly or difficult to segregate, ascertain or identify its individual assets from those of any Affiliate or any other Person;
(m) not and will not hold itself out to be responsible for the debts or obligations of any other Person; (n) shall not, without the vote of 100% 

50

 

of
the Board of Directors or Board of Managers of Seller (including, without limitation, each of the
Independent Director(s) or Independent Manager(s)), (i) file or consent to the filing of any bankruptcy, insolvency or reorganization case or proceeding with respect to Seller; institute any
proceedings under any applicable insolvency law or otherwise seek any relief under any laws relating to the relief from debts or the protection of debtors generally with respect to Seller;
(ii) seek or consent to the appointment of a receiver, liquidator, assignee, trustee, sequestrator, custodian or any similar official for Seller or a substantial portion of its properties; or
(iii) make any assignment for the benefit of Seller's creditors; and (o) shall have at least one (1) Independent Director or Independent Manager. 

        (y)    Maintenance of Property; Insurance.    Seller shall keep all property useful and necessary in its business in
good working order and condition; maintain with financially sound and reputable insurance companies insurance on all its property in at least such amounts and against at least such risks as are
usually insured against in the same general area by companies engaged in the same or a similar business, and furnish to Buyer, upon written request, full information as to the insurance carried. 

        (z)    Compliance with Laws.    Seller shall comply in all material respects with all applicable laws, ordinances,
rules, regulations, and requirements of governmental authorities (including, without limitation, Environmental Laws, and all federal securities laws) except where the necessity of compliance therewith
is contested in good faith by appropriate proceedings. 

        (aa)    ERISA.    Seller shall, and shall cause each of its Subsidiaries to, comply in all material respects with all
requirements of ERISA applicable with respect to each Plan. 

        (bb)    Investments.    Neither Seller nor any Affiliate thereof shall acquire or maintain any right or interest in
any Purchased Asset or Underlying Mortgaged Property that is senior to the rights and interests of Buyer therein under this Agreement and the other Repurchase Documents. 

        (cc)    Payment of Obligations.    Seller shall pay, discharge or otherwise satisfy at or before maturity or before
they become delinquent, as the case may be, all its obligations of whatever nature (including, without limitation, all amounts necessary to preserve the value of, and Seller's and Buyer's rights in,
the Purchased Assets), except where the amount or validity thereof is currently being contested in good faith by appropriate proceedings and reserves in conformity with GAAP with respect thereto have
been provided on the books of Seller, or its Subsidiaries, as the case may be. 

        (dd)    Margin Regulations.    No part of the proceeds of any Transaction hereunder shall be used for any purpose
which violates, or would be inconsistent with, the provisions of Regulation T, U or X. 

        (ee)    Limitation on Lines of Business.    Seller shall not enter into any business, either directly or through any
Subsidiary, except for those businesses in which Seller and its Subsidiaries are engaged on the date of this Agreement. 

        (ff)    Payment of Breakage Costs.    Seller shall pay Buyer, within one (1) Business Day after any request
therefor from Buyer, for all Breakage Costs at any time sustained or incurred by Buyer. 

        (gg)    Additional Sellers.    Subject to the terms and conditions of this Agreement and the other Repurchase
Documents, including without limitation the separateness provisions set forth in 9.01(x) of this Agreement, as a condition to the purchase of any asset types hereunder, Seller shall cause such
asset to be owned by a Special Purpose Entity which shall be a subsidiary of Seller. In the event that any Seller at any time acquires or forms any such Special Purpose Entity, (i) each such
Seller shall pledge in favor of Buyer all of the Capital Stock and other equity and ownership interests held by such Seller in each such Special Purpose Entity and such Seller shall take all such
further action as Buyer shall deem reasonably necessary or advisable (including, without limitation, the execution of financing statements on form UCC-1 and any additional security
agreements or amendments thereto) in order to effect and perfect such pledge and (ii) each such Special Purpose Entity shall deliver to buyer a properly completed and duly executed Additional
Seller Joinder Agreement substantially in the form of 

51

 

 Exhibit O hereto, pursuant to which such Special Purpose Entity shall become an Additional Seller under this Agreement. 

        (hh)    Maximum Total Liabilities Ratio.    At no time shall the Total Liabilities Ratio of Seller (on a consolidated
basis) exceed eighty-five percent (85%). 

        (ii)    Minimum Liquidity Requirement.    At no time during the first two (2) years following the Effective
Date of this Agreement shall the Parent maintain less than $10,000,000 in Cash and Cash Equivalents. At no time thereafter shall the Parent maintain less than $15,000,000 in Cash and Cash Equivalents. 

        (jj)    Fixed Charge Coverage Ratio.    At no time shall the Fixed Charge Coverage Ratio of Seller (on a consolidated
basis) be less than 1.50 to 1.00. 

        (kk)    Minimum Interest Coverage Ratio.    At no time shall the Interest Coverage Ratio of Seller (on a consolidated
basis) be less than 1.75 to 1.00. 

        (ll)    Minimum Tangible Net Worth.    At no time shall the Tangible Net Worth of Seller (on a consolidated basis) be
less than the greater of (i) $40,000,000, and (ii) seventy-five percent (75%) of the net proceeds of any Equity Issuance from and after the date of this Agreement by Parent. 

        (mm)    Prohibition on Additional Indebtedness.    Parent shall at no time be obligated for any Indebtedness in excess
of $100,000,000 in the aggregate, which Indebtedness shall, for purposes hereof, include, inter alia, (i) Parent's obligations under this Agreement, (ii) Parent's obligations under the
Guarantee Agreement executed pursuant to, and as that term is defined in, the Master Repo Facility, (iii) Seller's obligations under Liquidity Facility, and (iv) any Contingent
Liabilities of Seller (on a consolidated basis), but which shall exclude (x) standard recourse carve-out guarantees, and (y) customary and standard trade payables incurred by
Parent in the ordinary course of business, provided that (a) the aggregate amount of any such outstanding trade payables shall at no time exceed $500,000, and (b) any such trade payable
amounts shall be paid by Parent within sixty (60) days of when they were incurred, and (z) fees payable under the Management Contract as in effect on the date hereof. 

        (nn)    Independence of Covenants.    All covenants hereunder shall be given independent effect so that if a
particular action or condition is not permitted by any of such covenants, the fact that it would be permitted by an exception to, or be otherwise within the limitations of, another covenant shall not
avoid the occurrence of an Event of Default or Default if such action is taken or condition exists. 

        (oo)    Buy Back of Capital Stock.    Parent shall not (i) buy back any of its Capital Stock while this
Agreement remains in effect, or (ii) exchange or permit the exchange of any of its Capital Stock in connection with and/or in consideration for any internalization of the management of the
Parent. 

        (pp)    Payment of Third Party Management Fees.    Fees paid under the Management Contract (or any replacement or
substitution thereof) shall at no time exceed the fees payable under the Management Contract on the date of the IPO. 

        (qq)    Qualified Transferee.    Parent, or any Subsidiary thereof, that is at any time the
[obligee] with respect to any Eligible Asset, shall at no time fail to meet the requirements to be a Qualified Transferee of such Eligible Asset. 

        (rr)    Additional Subsidiary Indebtedness.    Parent shall not allow or suffer to exist any Indebtedness on the part
of any new or hereafter existing Subsidiary unless Parent shall have first delivered to Buyer a substantive Non-Consolidation Opinion of counsel with respect to Parent, such Subsidiary and
Parent's obligations and liability with respect to such Indebtedness. 

52

 

 
 

ARTICLE X
  
  EVENTS OF DEFAULT; REMEDIES    
    

        Section
10.01    Events of Default.    If any of the following events (each, an "Event of
Default") occur, each Seller and Buyer shall have the rights set forth in Section 10.02, as applicable: 

        (a)   any
Seller shall default in the payment of any Repurchase Price due or any amount under Section 5.01 when due (whether at stated maturity, upon acceleration or at
mandatory or optional prepayment); 

53

  

        (b)    Any Seller or Parent shall disavow, revoke or terminate any of the Wachovia Facilities or shall otherwise challenge or contest in proceeding the validity or
enforceability of any Facility Document; or 

        (c)    Seller
shall fail to cure any Margin Deficit in accordance with Section 4.01; or 

        (d)    Seller
shall default in the payment of any other amount payable by it hereunder or under any other Repurchase Document after written notification by Buyer of such
default, and such default shall have continued unremedied for five (5) Business Days; or 

        (e)    any
representation, warranty or certification made or deemed made herein or in any other Repurchase Document by any Seller or any certificate furnished to Buyer pursuant
to the provisions hereof or thereof or any material information with respect to the Mortgage Assets furnished in writing by on behalf of any Seller shall prove to have been false or misleading in any
material respect as of the time made or furnished (other than the representations and warranties set forth in Schedule 1, which shall be
considered solely for the purpose of determining the Asset Value of the Purchased Assets, unless (i) the applicable Seller shall have made any such representations and warranties with actual
knowledge that they were materially false or misleading at the time made; or (ii) any such representations and warranties have been determined in good faith by Buyer in its sole discretion to
be materially false or misleading on a regular basis); or 

        (f)    any
Seller shall fail to comply with the requirements of Sections 9.01(c)—(dd), or (except as otherwise set forth in Sections 10.01(a), 10.01(b), 10.01(c),
or 10.01(d)) any Seller shall fail to observe or perform any other covenant or agreement contained in this Agreement or any other Repurchase Document and such failure to observe or perform shall
continue unremedied for a period of ten (10) Business Days after actual knowledge by the applicable Seller or receipt of written notice from the Buyer;  provided, however that to the extent such failure to observe or perform relates to Seller's failure to
deliver reports required under Sections 9.01(a)(iii) or 9.01(b)(v)(2) and neither Seller nor its Affiliates have received such reports, and Seller has used commercially reasonable efforts to
obtain such reports as and when required hereunder, such failure shall not be deemed to be an Event of Default unless such failure shall have been on a consistent or frequent basis (which
determination shall be made in Buyer's reasonable discretion); or 

        (g)    a
final judgment or judgments for the payment of money in excess of $1,000,000 in the aggregate shall be rendered against any Seller by one or more courts,
administrative tribunals or other bodies having jurisdiction and the same shall not be satisfied, discharged (or provision shall not be made for
such discharge) or bonded, or a stay of execution thereof shall not be procured, within thirty (30) days from the date of entry thereof; or 

        (h)    an
Act of Insolvency or any liquidation, reorganization or bankruptcy shall have occurred with respect to Parent, any Seller or any of Affiliate thereof; or 

        (i)    Gramercy
Capital Manager LLC or an Affiliate or SL Green Realty Corp. ceases to be the manager of Parent; or 

        (j)    the
Custodial Agreement, the Account Control Agreement or any Repurchase Document or a replacement therefor acceptable to Buyer shall for whatever reason be terminated
by Seller or cease to be in full force and effect (other than due to causes solely within the control of Buyer or Custodian), or the enforceability thereof shall be contested by any Seller; or 

        (k)    any
Seller shall grant, or suffer to exist, any Lien on any Purchased Item (except any Lien in favor of Buyer); or the Purchased Items shall not have been sold to Buyer,
or the Liens contemplated hereby shall cease or fail to be first priority perfected Liens on any Purchased Items in favor of Buyer (other than by result of any action or inaction by the Buyer) or
shall be Liens in favor of any Person other than Buyer; or 

54

 

        (l)    any
Seller shall be in default under (i) any Indebtedness of Seller which default (1) involves the failure to pay a matured obligation, or
(2) permits the acceleration of the maturity of obligations by any other party to or beneficiary with respect to such Indebtedness, if the aggregate amount of the Indebtedness in respect of
which such default or defaults shall have occurred is at least $1,000,000, or (ii) any other material contract to which Seller is a party which default (1) involves the failure to pay a
matured obligation, or (2) permits the acceleration of the maturity of obligations by any other party to or beneficiary of such contract if the aggregate amount of such obligations is at least
$500,000; or 

        (m)    (i) any
Seller or an ERISA Affiliate shall engage in any "prohibited transaction" (as defined in Section 406 of ERISA or Section 4975 of the Code)
involving any Plan, (ii) any material "accumulated funding deficiency" (as defined in Section 302 of ERISA), whether or not waived, shall exist with respect to any Plan or any Lien in
favor of the PBGC or a Plan shall arise on the assets of any Seller or any ERISA Affiliate, (iii) a Reportable Event shall occur with respect to, or proceedings shall commence to have a trustee
appointed, or a trustee shall be appointed, to administer or to terminate, any Plan, which Reportable Event or commencement of proceedings or appointment of a trustee is, in the reasonable opinion of
Buyer, likely to result in the termination of such Plan for purposes of Title IV of ERISA, (iv) any Plan shall terminate for purposes of Title IV of ERISA, (v) any Seller or any
ERISA Affiliate shall, or in the reasonable opinion of Buyer is likely to, incur any liability in connection with a withdrawal from, or the insolvency or reorganization of, a Multiemployer Plan or
(vi) any other event or condition shall occur or exist with respect to a Plan; and in each case in clauses (i) through (vi) above, such event or condition, together with all other
such events or conditions, if any, could reasonably be expected to have a Material Adverse Effect; or 

        (n)    the
Pledge and Security Agreement shall cease to create a valid and perfected security interest in favor of Buyer in the Capital Stock of any Seller, or any Seller shall
so assert; or 

        (o)    any
Change of Control shall occur; or 

        (p)    the
Management Contract shall be amended to increase the amount of compensation required to be paid to the Manager thereunder, or the Management Contract shall be
otherwise materially amended to the detriment of Parent, or the Manager shall be terminated, in any case without the prior written consent of Buyer; 

        (q)    if
there shall occur any Event of Default under, and as that term is defined in, the Liquidity Facility or the Master Repo Facility; 

        (r)    if
any Newly Formed Subsidiary, if required by Buyer to be a Special Purpose Entity, fails at any time to comply with all of the requirements of being a Special Purpose
Entity, as such requirements are set forth in the definition thereof; 

        (s)    any
Seller shall fail to repurchase Purchased Assets within 120 days of the related Purchase Date (if no extension of the Repurchase Date has occurred); or 

        (t)    upon
the failure by Seller to satisfy any of the following asset or income tests: 

        (i)    At
the close of each taxable year, at least 75 percent of Seller's gross income consists of (i) "rents from real property" within the meaning of
Section 856(c)(3)(A) of the Code, (ii) interest on obligations secured by mortgages on real property or on interests in real property, within the meaning of Section 856(c)(3)(B)
of the Code, (iii) gain from the sale or other disposition of real property (including interests in real property and interests in mortgages on real property) which is not property described in
Section 1221(a)(1) of the Code, within the meaning of Section 856(c)(3)(C) of the Code, (iv) dividends or other distributions on, and gain (other than gain from "prohibited
transactions" within the meaning of Section 857(b)(6)(B)(iii) of the Code) from the sale or other disposition of, transferable shares (or transferable certificates of beneficial 

55

 

interest)
in other qualifying REITs within the meaning of Section 856(d)(3)(D) of the Code, and (v) amounts described in Sections 856(c)(3)(E) through 856(c)(3)(I) of the Code. 

        (ii)    At
the close of each taxable year, at least 95 percent of Seller's gross income consists of (i) the items of income described in paragraph 1 hereof
(other than those described in Section 856(c)(3)(I) of the Code), (ii) gain realized from the sale or other disposition of stock or securities which are not property described in
Section 1221(a)(1) of the Code, (iii) interest, (iv) dividends, and (v) income derived from payments to Seller on interest rate swap or cap agreements, options, futures
contracts, forward rate agreements and other similar financial instruments entered into to reduce the interest rate risks with respect to any indebted ness incurred or to be incurred to acquire or
carry real estate assets, or gain from the sale or other disposition of such an investment as described in Section 856(c)(5)(G), in each case within the meaning of Section 856(c)(2) of
the Code. 

        (iii)    At
the close of each quarter of Seller's taxable years, at least 75 percent of the value of Seller's total assets (as determined in accordance with Treasury
Regulations Section 1.856-2(d)) has consisted of and will consist of real estate assets within the meaning of Sections 856(c)(4) and 856(c)5(B) of the Code, cash and cash items
(including receivables which arise in the ordinary course of Seller's operations, but not including receivables purchased from another person), and government securities. 

        (iv)    At
the close of each quarter of each of Seller's taxable years, (i) not more than 25 percent of Seller's total asset value will be represented by
securities (other than those described in paragraph (iii), (ii) not more than 20 percent of Seller's total asset value will be represented by securities of one or more taxable
REIT subsidiaries, and (iii) (a) not more than 5 percent of the value of Seller's total assets will be represented by securities of any one issuer (other than Government
securities and securities of taxable REIT subsidiaries, and securities of a qualified REIT subsidiary within the meaning of Section 856(i) of the Code) of any of the REIT qualification
tests pursuant to Section 856(c) of the Code. 

        Section
10.02    Remedies.    (a) If an Event of Default shall have occurred and be continuing, the following
rights and remedies are available to Buyer. 

        (i)    At
the option of Buyer, exercised by written notice to Seller (which option shall be deemed to have been exercised, even if no notice is given, immediately upon the
occurrence of an Act of Insolvency of Seller), the Repurchase Date for each Transaction hereunder, if it has not already occurred, shall be deemed immediately to occur. Buyer shall (except upon the
occurrence of an Act of Insolvency of any Seller) give notice to Seller of the exercise of such option as promptly as practicable. 

        (ii)    If
Buyer exercises or is deemed to have exercised the option referred to in Section 10.02(a)(i), 

        (A)    (i) all
of Seller's obligations in respect of such Transactions to repurchase all Purchased Assets at the Repurchase Price therefor on the Repurchase Date, and to
pay all other amounts owed by Seller hereunder, shall thereupon become immediately due and payable, (ii) all Income paid after such exercise or deemed exercise shall be retained by Buyer and
applied to the aggregate unpaid Repurchase Prices and any other amounts owed by Seller hereunder or under any other Repurchase Document, and (iii) Seller shall immediately deliver to Buyer any
Purchased Assets subject to such Transactions then in Seller's possession or control; 

        (B)    from
and after the exercise or deemed exercise of such option, to the extent permitted by applicable law, the Repurchase Price with respect to each such Transaction
shall be determined by daily application of, on a 360 day per year basis for the actual number of 

56

 

days
during the period from and including the date of the exercise or deemed exercise of such option to but excluding the date of payment of the Repurchase Price, (x) the
Post-Default Rate to (y) the Repurchase Price for such Transaction as of the Repurchase Date (decreased as of any day by (i) any amounts actually in the possession of Buyer
pursuant to clause (C) of this subsection, (ii) any proceeds from the sale of Purchased Assets applied to the Repurchase Price pursuant to Section 10.02(a)(iv), and
(iii) any amounts applied to the Repurchase Price pursuant to Section 10.02(a); and 

        (C)    all
Income actually received by Buyer pursuant to Section 5.01 (excluding any Late Payment Fees paid pursuant to Section 3.06(a)) shall be applied to the
aggregate unpaid Repurchase Price owed by the applicable Seller. 

        (iii)    Upon
the occurrence and during the continuance of one or more Events of Default, Buyer shall have the right to obtain physical possession of the Servicing Records
(subject to the provisions of the Custodial Agreement) and all other files of the applicable Seller relating to the Purchased Assets and all documents relating to the Purchased Assets which are then
or may thereafter come into the possession of Seller or any third party acting for Seller and Seller shall deliver to Buyer such assignments as Buyer shall request and Buyer shall have the right to
appoint any Person to act as
Servicer for the Purchased Assets. Buyer shall be entitled to specific performance of all agreements of Seller contained in the Repurchase Documents. 

        (iv)    At
any time on the Business Day following written notice to Seller (which notice may be the written notice given under Section 10.02(a)(i)), in the event Seller
has not repurchased all Purchased Assets, Buyer may (A) immediately sell, without demand or further notice of any kind, at a public or private sale and at such price or prices as Buyer may deem
satisfactory any or all Purchased Assets subject to such Transactions hereunder and apply the proceeds thereof to the aggregate unpaid Repurchase Price and any other amounts owing by Seller hereunder
or (B) in its sole discretion elect, in lieu of selling all or a portion of such Purchased Assets, to give Seller credit for such Purchased Assets in an amount equal to the Market Value of the
Purchased Assets against the aggregate unpaid Repurchase Price and any other amounts owing by Seller hereunder. The proceeds of any disposition of Purchased Assets shall be applied  first to the costs
and expenses incurred by Buyer in connection with any Seller's default; second to
costs of related covering and/or related hedging transactions; third to the aggregate Repurchase Price; and  fourth to any other outstanding obligation of
any Seller to Buyer or its Affiliates under this Agreement. 

        (v)    Each
Seller agrees that Buyer may seek to obtain an injunction or an order of specific performance to compel Seller to fulfill any of its obligations as set forth in
Article XI, if Seller fails or refuses to perform its obligations as set forth therein. 

        (vi)    Seller
shall be liable to Buyer, payable as and when incurred by Buyer, for (A) the amount of all actual out-of-pocket expenses,
including legal or other expenses incurred by Buyer in connection with or as a consequence of any Event of Default, and (B) all costs incurred in connection with hedging or covering
transactions. 

        (vii)    Buyer
shall have, in addition to its rights hereunder, any rights otherwise available to it under any other agreement or applicable law. 

        (b)    Buyer
may exercise one or more of the remedies available to Buyer immediately upon and during the continuance of an Event of Default and, except to the extent provided
in Sections 10.02(a)(i) and 10.02(a)(iv), at any time thereafter without notice to any Seller. All rights and remedies arising under this Agreement as amended from time to time hereunder are
cumulative and not exclusive of any other rights or remedies which Buyer may have. 

        (c)    Buyer
may enforce its rights and remedies hereunder without prior judicial process or hearing, and each Seller hereby expressly waives any defenses Seller might
otherwise have to require 

57

 

Buyer
to enforce its rights by judicial process. Each Seller also waives any defense (other than a defense of payment or performance) Seller might otherwise have arising from the use of nonjudicial
process, enforcement and sale of all or any portion of the Purchased Items, or from any other election of remedies. Seller recognizes that nonjudicial remedies are consistent with the usages of the
trade, are responsive to commercial necessity and are the result of a bargain at arm's-length. 

        (d)    To
the extent permitted by applicable law each Seller shall be liable to Buyer for interest on any amounts owing by Seller hereunder, from the date Seller becomes liable
for such amounts hereunder until such amounts are (i) paid in full or (ii) satisfied in full by the exercise of Buyer's rights hereunder. Interest on any sum payable by any Seller to
Buyer under this Section 10.02(d) shall be at a rate equal to the Post-Default Rate. 

 
 

ARTICLE XI
  
    SERVICING    
    

        Section
11.01    Seller Covenants.    Each Seller covenants to cause the servicing of the Mortgage Assets to be
maintained in conformity with Accepted Servicing Practices and in a manner at least equal in quality to the servicing Seller would provide for Mortgage Assets which it owns. In the event that the
preceding language is interpreted as constituting one or more servicing contracts, each such servicing contract shall terminate automatically upon the earliest of (i) an Event of Default,
(ii) the date on which this Agreement terminates or (iii) the transfer of servicing approved by Buyer in accordance with the terms of this Agreement. 

        Section
11.02    Seller as Servicer.    If the Mortgage Assets are serviced an Affiliate of any Seller, each Seller
agrees that, until the repurchase of a Mortgage Asset on a Repurchase Date for a Mortgage Asset, Buyer is the owner of all servicing records, including but not limited to any and all servicing
agreements, files, documents, records, data bases, computer tapes, copies of computer tapes, proof of insurance coverage, insurance policies, appraisals, other closing documentation, payment history
records, and any other records relating to or evidencing the servicing of such Mortgage Asset (the "Servicing Records"). Each Seller covenants to
safeguard such Servicing Records and to deliver them promptly to Buyer or its designee (including the Custodian) at Buyer's request. 

        Section
11.03    Third Party Servicer.    If any Mortgage Assets are serviced by a person other than an Affiliate of
Seller (such third party, the "Servicer"), (i) Seller shall, in accordance with Section 3.02(g), provide to Buyer a copy of the servicing
agreement, which shall be in form and substance reasonably acceptable to Buyer (the "Servicing Agreement") and Seller shall require each Servicing
Agreement to contain provisions relating to the delivery of information and reports as will enable each Seller to comply with its obligations under this Agreement as and when required hereunder, and
(ii) each Seller hereby irrevocably assigns to Buyer, and Buyer's successors and assigns, all of Seller's right, title and interest in, to and under, and the benefits of, each Servicing
Agreement pertaining to any Mortgage Assets. Each Seller agrees that no Person shall assume the servicing obligations with respect to any Mortgage Assets as successor to the Servicer unless such
successor is a Qualified Servicer. Buyer hereby agrees that upon the repurchase of any Mortgage Asset, Buyer shall assign back to the applicable Seller all of Buyer's right, title and interest in, to
and under, and the benefits of, any Servicing Agreement pertaining to such Mortgage Asset. 

        Section
11.04    Event of Default.    If the servicer of the Mortgage Assets is a Seller or an Affiliate of a Seller,
upon the occurrence and during the continuance of an Event of Default, Buyer shall have the right to terminate Seller or Affiliate as servicer of the Mortgage Assets and transfer servicing to its
designee, at no cost or expense to Buyer, at any time thereafter. If the servicer of the Mortgage Assets is not a Seller, Buyer shall have the right, as contemplated in the applicable Servicer Notice,
upon the occurrence of an Event of Default, to terminate any applicable Servicing Agreement and transfer 

58

 

servicing
to its designee, at no cost or expense to Buyer, it being agreed that Seller will pay any and all fees required to terminate such Servicing Agreement and to effectuate the transfer of
servicing to the designee of Buyer. 

        Sectopm
11.05    Modification.    After the Purchase Date, until the repurchase of any Mortgage Asset, no Seller will
have any right to modify or alter the terms of such Mortgage Asset and no Seller will have any obligation or right to repossess such Mortgage Asset or substitute another Mortgage Asset, in each case
except as provided in the Custodial Agreement. 

        Section
11.06    Inspection.    In the event that any Seller or any Affiliate thereof is servicing the Mortgage
Assets, Seller or Affiliate shall permit Buyer to inspect Seller's or Affiliate's servicing facilities, as the case may be, for the purpose of satisfying Buyer that Seller or Affiliate, as the case
may be, has the ability to service the Mortgage Assets as provided in this Agreement. 

 
 

ARTICLE XII
  
    MISCELLANEOUS    
    

        Section
12.01    Indemnification and Expenses.    (a) Each Seller jointly and severally, agrees to indemnify
and hold harmless Buyer and each of its Affiliates and Subsidiaries and their present and former respective officers, directors, employees, agents, advisors and other representatives (each, an
"Indemnified Party") from and against any and all claims, damages, losses, liabilities, costs, and expenses (including, without limitation, attorneys'
fees and disbursements) ("Costs") that may be incurred by or asserted or awarded against any Indemnified Party, in each case relating to or arising out
of this Agreement, any other Repurchase Document or any transaction contemplated hereby or thereby, or any amendment, supplement or modification of, or any waiver or consent under or in respect of,
this Agreement, any other Repurchase Document or any transaction contemplated hereby or thereby, except to the extent such claim, damage, loss, liability, cost, or expense is found in a final, non
appealable judgment by a court of competent jurisdiction to have resulted from such Indemnified Party's gross negligence or willful misconduct. Costs subject to this Section 12.01 shall include
but not be limited to Costs incurred in connection with the violation of any Environmental Law, the correction of any environmental condition or the removal of any Materials of Environmental Concern,
in each case in any way affecting Seller's or any of its Affiliates' properties or any of the Mortgage Assets. Without limiting the generality of the foregoing, each Seller agrees to hold any
Indemnified Party harmless from and indemnify such Indemnified Party against all Costs with respect to all Mortgage Assets relating to or arising out of any violation or alleged violation of any law,
rule or regulation, except to the extent such claim, damage, loss, liability, cost, or expense is found in a final, non appealable judgment by a court of competent jurisdiction to have resulted from
such Indemnified Party's gross negligence or willful misconduct. In the case of an investigation, litigation or other proceeding to which the indemnity in this Section 12.01 applies, such
indemnity shall be effective whether or not such investigation, litigation or proceeding is brought by any Seller, its directors, shareholders or creditors or an Indemnified Party or any other Person
or any Indemnified Party is otherwise a party thereto and whether or not any transaction contemplated hereby is consummated. Each Seller agrees not to assert any claim against any Indemnified Party,
or any of their respective directors, officers, employees, attorneys, agents, and advisers, on any theory of liability, for special, indirect, consequential, or punitive damages arising out of or
otherwise relating to the Repurchase Documents, any of the transactions contemplated herein or the actual or proposed use of the proceeds of any Transaction. In any suit, proceeding or action brought
by an Indemnified Party in connection with any Mortgage Asset for any sum owing thereunder, or to enforce any provisions of any Mortgage Asset, each Seller will save, indemnify and hold such
Indemnified Party harmless from and against all expense, loss or damage suffered by reason of any defense, set-off, counterclaim, recoupment or reduction or liability whatsoever of the
account debtor or obligor thereunder, arising out of a breach by 

59

 

any
Seller of any obligation thereunder or arising out of any other agreement, indebtedness or liability at any time owing to or in favor of such account debtor or obligor or its successors from any
Seller. Each Seller also agrees to reimburse an Indemnified Party as and when billed by such Indemnified Party for all the Indemnified Party's costs and expenses incurred in connection with the
enforcement or the preservation of Buyer's rights under this Agreement, any other Repurchase Document or any transaction contemplated hereby or thereby, including without limitation the fees and
disbursements of its counsel. 

        (b)    Each
Seller shall, whether or not any transaction contemplated hereby is consummated: (i) pay as when billed by Buyer, and in any event within three
(3) days after demand from Buyer, all reasonable out-of-pocket costs and expenses (including, without limitation, all actual and reasonable fees and disbursements of
outside legal counsel, accounting, consulting, brokerage or other similar professional fees or expenses, and any reasonable fees and expenses associated with travel
or other costs relating to any appraisals or examinations conducted in connection with any Transactions or any proposed Purchased Assets, and the amount of such costs and expenses shall, until paid,
bear interest at the greater of (x) 5.25% per annum in excess of the Prime Rate in effect from time to time or (y) 0.50%  per annum in excess of
the Federal Funds Rate in effect from time to time (or at such greater rate plus 6.00%, at any time the Post-Default
Rate is applicable to any Transaction)) (A) of Buyer in connection with the development, preparation, execution and delivery of, and any amendment, supplement or modification to, this
Agreement, any other Repurchase Document or any other documents prepared in connection herewith or therewith and the documents and instruments referred to herein and therein (including, without
limitation, all reasonable fees, disbursements and expenses of Cadwalader, Wickersham & Taft LLP and/or other counsel incurred as of the date of this Agreement, which amount shall be deducted
from the Purchase Price paid for the first Transaction hereunder) and (B) of Buyer in connection with the enforcement of this Agreement and the other Repurchase Documents and any amendment,
waiver or consent relating hereto or thereto and the documents and instruments referred to herein and therein; (ii) pay and hold Buyer harmless from and against any and all present and future
stamp, documentary, issue, sales and use, value added, property and other similar taxes (other than taxes imposed on net income) with respect to the matters described in foregoing clause (i)
and hold Buyer harmless from and against any and all liabilities with respect to or resulting from any delay or omission to pay such taxes; and (iii) indemnify each Indemnified Party from and
hold each of them harmless against any and all Costs incurred by any of them as a result of, or arising out of, or in any way related to, or by reason of, the entering into and/or performance of this
Agreement or any other Repurchase Document or the use of the proceeds of any Transaction hereunder or the consummation of any transactions contemplated herein or in any other Repurchase Document,
including, without limitation, (A) the reasonable out of pocket due diligence, inspection, appraisals, testing and review costs and expenses incurred by Buyer with respect to Mortgage Assets
submitted by any Seller for purchase under this Agreement, including, but not limited to, those actual out of pocket costs and expenses incurred by Buyer pursuant to Sections 11.01 through 11.06 and
Section 12.11, (B) the reasonable fees and disbursements of counsel incurred in connection therewith and (C) any environmental liabilities with respect to any real estate or other
assets held by any Seller or any of its Affiliates (but excluding any such Costs to the extent incurred by reason of the gross negligence or willful misconduct of the Person to be indemnified). 

        (c)    Without
prejudice to the survival of any other agreement of any Seller hereunder, the agreements and obligations of each Seller contained in this Section 12.01
shall survive the repayment of all amounts owing to Buyer by Seller under the Repurchase Documents and the termination of the commitment of Buyer hereunder. 

        Section
12.02    Single Agreement.    Each Seller and Buyer acknowledge that, and have entered hereinto and will enter
into each Transaction hereunder in consideration of and in reliance upon the fact that, all Transactions hereunder constitute a single business and contractual relationship and that 

60

 

each
has been entered into in consideration of the other Transactions. Accordingly, each of Seller and Buyer agrees (i) to perform all of its obligations in respect of each Transaction
hereunder, and that a default in the performance of any such obligations shall constitute a default by it in respect of all Transactions hereunder, (ii) that each of them shall be entitled to
set off claims and apply property held by them in respect of any Transaction against obligations owing to them in respect of any other Transaction hereunder, (iii) that payments, deliveries,
and other transfers made by either of them in respect of any Transaction shall be deemed to have been made in consideration of payments, deliveries, and other transfers in respect of any other
Transactions hereunder, and the obligations to make any such payments, deliveries, and other transfers may be applied against each other and netted and (iv) to promptly provide notice to the
other after any such set off or application. 

        Section
12.03    Notices and Other Communications.    Except as otherwise expressly permitted by this Agreement, all
notices, requests and other communications provided for herein and under the Custodial Agreement (including without limitation any modifications of, or waivers, requests or consents under, this
Agreement) shall be given or made in writing (including without limitation by email, telex or telecopy) delivered to the intended recipient at the "Address for Notices" specified below its name on the
signature pages hereof or thereof); or, as to any party, at such other address as shall be designated by such party in a written notice to each other party. Except as otherwise provided in this
Agreement and except for notices given under Article III (which shall be effective only on receipt), all such communications shall be deemed to have been duly given when transmitted by
Electronic Transmission or telecopy (upon receipt of confirmation) or personally delivered or, in the case of a mailed notice, upon receipt. 

        Section
12.04    Entire Agreement; Severability.    This Agreement together with the other Repurchase Documents and
the Account Control Agreement constitute the entire understanding among Seller and Buyer with respect to the subject matter it covers and shall supersede any existing agreements between the parties
containing general terms and conditions for repurchase transactions involving Purchased Assets. By acceptance of this Agreement, Seller and Buyer acknowledge that they have not made, and are not
relying upon, any statements, representations, promises or undertakings not contained in this Agreement. Each provision and agreement herein shall be treated as separate and independent from any other
provision or agreement herein and shall be enforceable notwithstanding the unenforceability of any such other provision or agreement. 

        Section 12.05    Assignments and Participations; Hypothecation of Purchased Assets.    

        (a)    No
Seller may assign any of its rights or obligations under this Agreement without the prior written consent of Buyer, not to be unreasonably withheld or delayed, and
any attempt by any Seller to assign any of its rights or obligations under this Agreement without the prior written consent of Buyer shall be null and void. Buyer may upon notice to Seller and without
consent of Seller, sell to one or more banks, financial institutions or other entities ("Participants") participating interests in any Transaction, its
interest in the Purchased Assets, or any other interest of Buyer under this Agreement. Buyer shall have the right to disclose information to prospective Participants and Assignees (as defined herein).
Buyer may, at any time and from time to time, assign to any Person (an "Assignee" and together with Participants, each a
"Transferee" and collectively, the "Transferees") all or any part of its rights and interest in the
Purchased Assets, or any other interest of Buyer under this Agreement; provided, that (i) unless Buyer is assigning all of its rights and
interests in the Purchased Assets and under this Agreement, in which case there shall be no minimum transfer amount, each such assignment shall be in a minimum of amount of $5,000,000 and
(ii) so long as no Default or Event of Default exists and so long as all Margin Deficits are timely satisfied in accordance with Article IV hereof, (A) Buyer shall not assign all
or any part of its rights and interest in the Purchased Assets, or any other interest of Buyer under this Agreement, to the extent that, after giving effect to such assignment, Buyer is no longer the
"lead" financial institution under this Agreement or any Person other than Buyer is agent for the financial institutions parties hereto and (B) Buyer shall not assign all or any part 

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of
its rights and interest in the Purchased Assets, or any other interest of Buyer under this Agreement, except to an Assignee which is a commercial bank, savings and loan association, pension fund,
insurance company, investment bank or other similar financial institution or intermediary. Each Seller agrees to cooperate with Buyer in connection with any such assignment, transfer or sale of
participating interest and to enter into such restatements of, and amendments, supplements and other modifications to, this Agreement in order to give effect to such assignment, transfer or sale. 

        (b)    Title
to all Purchased Assets and Purchased Items shall pass to Buyer and Buyer shall have free and unrestricted use of all Purchased Assets. Nothing in this Agreement
shall preclude Buyer from engaging in repurchase transactions with the Purchased Assets and Purchased Items or otherwise selling, pledging, repledging, transferring, hypothecating, or rehypothecating
the Purchased Assets and Purchased Items, all on terms that Buyer may determine in its sole discretion; provided,  however, that Buyer shall transfer the
Purchased Assets to the applicable Seller on the applicable Repurchase Date free and clear of any pledge, Lien,
security interest, encumbrance, charge or other adverse claim on any of the Purchased Assets. Nothing contained in this Agreement shall obligate the Buyer to segregate any Purchased Assets or
Purchased Items transferred to Buyer by any Seller. 

        SECTION 12.06    GOVERNING LAW.    THIS AGREEMENT AND THE OTHER REPURCHASE DOCUMENTS AND THE
RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

        SECTION 12.07    SUBMISSION TO JURISDICTION; VENUE; WAIVER OF JURY TRIAL. 

        (A)    ANY LEGAL ACTION OR PROCEEDING AGAINST ANY SELLER WITH RESPECT TO THIS AGREEMENT OR ANY OTHER REPURCHASE DOCUMENT TO WHICH SELLER IS A PARTY MAY
BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT, SELLER HEREBY IRREVOCABLY ACCEPTS FOR
ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS. EACH SELLER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE
AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO SELLER AT ITS ADDRESS AS DESIGNATED IN ACCORDANCE WITH
SECTION 12.03 OF THIS AGREEMENT, SUCH SERVICE TO BECOME EFFECTIVE TEN (10) DAYS AFTER SUCH MAILING. NOTHING HEREIN SHALL AFFECT THE RIGHT OF BUYER TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED
BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST ANY SELLER IN ANY OTHER JURISDICTION.

        (B)    EACH SELLER HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID ACTIONS OR
PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER REPURCHASE DOCUMENT BROUGHT IN THE COURTS REFERRED TO IN CLAUSE (A) ABOVE AND HEREBY FURTHER IRREVOCABLY WAIVES AND
AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.

        (C)    EACH OF THE PARTIES TO THIS AGREEMENT HEREBY WAIVES ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
OUT OF THIS AGREEMENT OR ANY OF THE OTHER REPURCHASE DOCUMENTS OR ANY DEALINGS, COURSE OF DEALINGS, COURSE OF CONDUCT BETWEEN THEM, OR ANY STATEMENTS (WHETHER ORAL OR WRITTEN) OR OTHER ACTIONS OF ANY
PARTY,  

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 RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT OR THE RELATIONSHIP THAT IS BEING ESTABLISHED HEREBY, INCLUDING, WITHOUT LIMITATION, ANY ACTION OF BUYER RELATING TO THE ADMINISTRATION OF THE
TRANSACTIONS OR THE ENFORCEMENT OF THE REPURCHASE DOCUMENTS, AND NONE OF THE PARTIES HERETO WILL SEEK TO CONSOLIDATE ANY SUCH ACTION WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT BE OR HAS NOT
BEEN WAIVED.

        (D)    EXCEPT AS PROHIBITED BY LAW, EACH SELLER HEREBY WAIVES ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER IN ANY LITIGATION ANY SPECIAL, EXEMPLARY,
PUNITIVE OR CONSEQUENTIAL DAMAGES OR ANY DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL DAMAGES. EACH SELLER CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF BUYER HAS REPRESENTED, EXPRESSLY OR
OTHERWISE, THAT BUYER WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVER. THE SCOPE OF THIS WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION,
INCLUDING WITHOUT LIMITATION CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS.

        (E)    EACH PARTY HERETO ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS ALREADY RELIED ON
THIS WAIVER IN ENTERING INTO THIS AGREEMENT, AND THAT EACH WILL CONTINUE TO RELY ON THIS WAIVER IN THEIR RELATED FUTURE DEALINGS. EACH PARTY HERETO FURTHER WARRANTS AND REPRESENTS THAT IT HAS REVIEWED
THIS WAIVER WITH ITS LEGAL COUNSEL AND THAT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL.

        (F)    THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING, AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT
AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT OR ANY OF THE OTHER REPURCHASE DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO ANY TRANSACTION ENTERED INTO
HEREUNDER. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

        Section
12.08    Amendments; Waivers; Remedies Cumulative.    Except as otherwise expressly provided in this
Agreement, any provision of this Agreement may be modified or supplemented only by an instrument in writing signed by each of Seller and Buyer. Any amendments or waivers of the provisions of this
Agreement or the Repurchase Documents with respect to (a) increases in the commitment of Buyer or Banks (as such term is defined in the Liquidation Facility), (b) reductions of principal
payments, interest or fees, (c) extensions of scheduled maturities (other than as expressly permitted in this Agreement or the Liquidity Facility documents) or times for payment and
(d) releases of any obligor, shall require the approval of Buyer and the Banks. Any provision of this Agreement may be waived by Buyer; provided,
that no failure or delay on the part of Buyer in exercising any right, power or privilege hereunder or under any other Repurchase Document and no course of dealing with respect to any right, power or
privilege hereunder or under any other Repurchase Document shall operate as a waiver thereof; nor shall any single or partial exercise of any right, power or privilege hereunder or under any other
Repurchase Document preclude any other or further exercise thereof or the exercise of any other right, power or privilege hereunder or thereunder. The rights, powers and remedies herein or in any
other Repurchase Document expressly provided are cumulative and not exclusive of any rights, powers or remedies which Buyer would otherwise have. No notice to or demand on any Seller in any case shall
entitle any Seller to any other or further notice or demand in similar or other circumstances or constitute a waiver of the rights of Buyer to any other or further action in any 

63

 

circumstances
without notice or demand. An Event of Default shall be deemed to be continuing unless expressly waived by Buyer in writing. 

        Section
12.09    Intent.    (a) The parties recognize that each Transaction is not a
"Repurchase Agreement" as that term is defined in Section 101 of Title 11 of the United States Code, as amended (except insofar as the
sub-limit of Purchased Assets subject to such Transaction or the term of such Transaction would render such definition applicable), or a "Securities
Contract" as that term is defined in Section 741 of Title 11 of the United States Code, as amended (except insofar as the type of Purchased Assets subject to such
Transaction would render such definition applicable). 

        (b)    It
is understood that either party's right to liquidate Purchased Assets delivered to it in connection with Transactions hereunder or to exercise any other remedies
pursuant to Section 10.02 hereof is a contractual right to liquidate such Transaction as described in Sections 555 and 559 of Title 11 of the United States Code, as amended. 

        (c)    The
parties agree and acknowledge that if a party hereto is an "Insured Depository Institution," as such term is defined
in the Federal Deposit Insurance Act, as amended ("FDIA"), then each Transaction hereunder is a "Qualified Financial
Contract," as that term is defined in FDIA and any rules, orders or policy statements thereunder (except insofar as the type of Purchased Assets subject to such Transaction
would render such definition inapplicable). 

        (d)    It
is understood that this Agreement constitutes a "Netting Contract" as defined in and subject to Title IV of the
Federal Deposit Insurance Corporation Improvement Act of 1991 ("FDICIA") and each payment entitlement and payment obligation under any Transaction
hereunder shall constitute a "Covered Contractual Payment Entitlement" or "Covered Contractual Payment
Obligation", respectively, as defined in and subject to FDICIA (except insofar as one or both of the parties is not a "Financial
Institution" as that term is defined in FDICIA or regulations promulgated thereunder). 

        Section 12.10    Joint and Several Liability.    

        (a)    Each
Seller hereby acknowledges and agrees that Seller shall be jointly and severally liable to Buyer to the maximum extent permitted by applicable law for all
representations, warranties, covenants, obligations and indemnities of Seller hereunder. 

        (b)    Each
Seller hereby agrees that, to the extent another Seller shall have paid more than its proportionate share of any payment made hereunder, Seller shall be entitled to
seek and receive contribution from and against any other Seller which has not paid its proportionate share of such payment; provided however, that the
provisions of this clause shall in no respect limit the obligations and liabilities of any Seller to Buyer, and, notwithstanding any payment or payments made by any Seller (the "paying Seller")
hereunder or any set-off or application of funds of the paying Seller by Buyer, the paying Seller shall not be entitled to be subrogated to any of the rights of Buyer against any other
Seller or any collateral security or guarantee or right of offset held by Buyer, nor shall the paying Seller seek or be entitled to seek any contribution or reimbursement from the other Seller in
respect of payments made by the paying Seller hereunder, until all amounts owing to
Buyer by the Seller under the Repurchase Documents are paid in full. If any amount shall be paid to the paying Seller on account of such subrogation rights at any time when all such amounts shall not
have been paid in full, such amount shall be held by the paying Seller in trust for Buyer, segregated from other funds of the paying Seller, and shall, forthwith upon receipt by the paying Seller, be
turned over to Buyer in the exact form received by the paying Seller (duly indorsed by the paying Seller to Buyer, if required), to be applied against amounts owing to Buyer by Seller under the
Repurchase Documents, whether matured or unmatured, in such order as Buyer may determine. 

        (c)    Each
Seller shall remain obligated under this Section 12.10 notwithstanding that, without any reservation of rights against Seller and without notice to or
further assent by Seller, any demand by 

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Buyer
for payment of any amounts owing to Buyer by any other Seller under the Repurchase Documents may be rescinded by Buyer and any the payment of any such amounts may be continued, and the liability
of any other party upon or for any part thereof, or any collateral security or guarantee therefor or right of offset with respect thereto, may, from time to time, in whole or in part, be renewed,
extended, amended, modified, accelerated, compromised, waived, surrendered or released by Buyer, and this Agreement and the other Repurchase Documents and any other documents executed and delivered in
connection therewith may be amended, modified, supplemented or terminated, in whole or in part, as Buyer may deem advisable from time to time, and any collateral security, guarantee or right of offset
at any time held by Buyer for the payment of amounts owing to Buyer by Seller under the Repurchase Documents may be sold, exchanged, waived, surrendered or released. Buyer shall not have any
obligation to protect, secure, perfect or insure any Lien at any time held by it as security for amounts owing to Buyer by Seller under the Repurchase Documents, or any property subject thereto. When
making any demand hereunder against any Seller, Buyer may, but shall be under no obligation to, make a similar demand on any other Seller, and any failure by Buyer to make any such demand or to
collect any payments from any other Seller, or any release of such other Seller shall not relieve any Seller in respect of which a demand or collection is not made or Seller not so released of their
obligations or liabilities hereunder, and shall not impair or affect the rights and remedies, express or implied, or as a matter of law, of Buyer against Seller. For the purposes hereof "demand" shall
include the commencement and continuance of any legal proceedings. 

        (d)    Each
Seller waives any and all notice of the creation, renewal, extension or accrual of any amounts at any time owing to Buyer by any other Seller under the Repurchase
Documents and notice of or proof of reliance by Buyer upon Seller or acceptance of the obligations of Seller under this Section 12.10, and all such amounts, and any of them, shall conclusively
be deemed to have been created, contracted or incurred, or renewed, extended, amended or waived, in reliance upon the obligations of Seller under this Section 12.10; and all dealings between
the Sellers, on the one hand, and Buyer, on the other hand, likewise shall be conclusively presumed to have been had or consummated in reliance upon the obligations of the Seller under this
Section 12.10. Seller waives diligence, presentment, protest, demand for payment and notice of default or nonpayment to or upon Seller with respect to any amounts at any time owing to Buyer by
Seller under the Repurchase Documents, other than such notices as are expressly required to be given under this Agreement or any of the other Repurchase Documents. Each Seller understands and agrees
that it shall continue to be liable under this Section 12.10 without regard to (a) the validity, regularity or enforceability of any other provision of this Agreement or any other
Repurchase Document, any amounts at any time owing to Buyer by Seller under the Repurchase Documents, or any other collateral security therefor or guarantee or right of offset with respect thereto at
any time or from time to time held by Buyer, (b) any defense, set-off or counterclaim (other than a defense of payment or performance) which may at any time be available to or be
asserted by Seller against Buyer, or (c) any other circumstance whatsoever (with or without notice to or knowledge of Seller) which constitutes, or might be construed to constitute, an
equitable or legal discharge of Seller for any amounts owing to Buyer by Seller under the Repurchase Documents, or of Seller under this Agreement, in bankruptcy or in any other instance. When pursuing
its rights and remedies hereunder against Seller, Buyer may, but shall be under no obligation to, pursue such rights and remedies as it may have against Seller or any other Person or against any
collateral security or guarantee related thereto or any right of offset with respect thereto, and any failure by Buyer to pursue such other rights or remedies or to collect any payments from Seller or
any such other Person or to realize upon any such collateral security or guarantee or to exercise any such right of offset, or any release of Seller or any such other Person or any such collateral
security, guarantee or right of offset, shall not relieve Seller of any liability hereunder, and shall not impair or affect the rights and remedies, whether express, implied or available as a matter
of law, of Buyer against Seller. 

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        (e)    Anything
herein or in any other Repurchase Document to the contrary notwithstanding, the maximum liability of Seller hereunder in respect of the liabilities of the other
Sellers under this Agreement and the other Repurchase Documents shall in no event exceed the amount which can be guaranteed by Seller under applicable federal and state laws relating to the insolvency
of debtors. 

        Section
12.11    Periodic Due Diligence Review.    Each Seller acknowledges that Buyer has the right to perform
continuing due diligence reviews with respect to the Purchased Assets, for purposes of verifying compliance with the representations, warranties and specifications made hereunder, or otherwise, and
Seller agrees that upon reasonable (but no less than three (3) Business Day's) prior notice unless an Event of Default shall have occurred and be continuing, in which case no notice is
required, to any Seller, Buyer or its authorized representatives will be permitted during normal business hours to examine, inspect, and make copies and extracts of, the Mortgage Asset Files and any
and all documents, records, agreements, instruments or information relating to such Purchased Assets in the possession or under the control of any Seller and/or the Custodian. Each Seller also shall
make
available to Buyer a knowledgeable financial or accounting officer for the purpose of answering questions respecting the Mortgage Asset Files and the Purchased Assets. Without limiting the generality
of the foregoing, each Seller acknowledges that Buyer may purchase Mortgage Assets from the applicable Seller based solely upon the information provided by Seller to Buyer in the Seller Asset Schedule
and the representations, warranties and covenants contained herein, and that Buyer, at its option, has the right at any time to conduct a partial or complete due diligence review on some or all of the
Purchased Assets purchased in a Transaction, including without limitation ordering new credit reports and new appraisals on the related Mortgaged Properties and otherwise re-generating the
information used to originate such Purchased Asset. Buyer may underwrite such Purchased Assets itself or engage a mutually agreed upon third party underwriter to perform such underwriting. Each Seller
agrees to cooperate with Buyer and any third party underwriter in connection with such underwriting, including, but not limited to, providing Buyer and any third party underwriter with reasonable
access to any and all documents, records, agreements, instruments or information relating to such Purchased Assets in the possession, or under the control, of Seller. The Seller shall pay all
out-of-pocket costs and expenses (including fees and expenses of counsel, if any) incurred by Buyer in connection with Buyer's activities pursuant to this Section 12.11
("Due Diligence Costs"); provided that, in the event that a Default or an Event of Default shall have
occurred, the Seller shall reimburse Buyer for all Due Diligence Costs for any and all reasonable out-of-pocket costs and expenses incurred by Buyer in connection with any due
diligence review conducted by the Buyer pursuant to this Section 12.11 following the occurrence and during the continuation of such Default or Event of Default. 

        Section
12.12    Buyer's Appointment as Attorney-in-Fact.    (a) Following the
occurrence and during the continuance of an Event of Default, each Seller hereby irrevocably constitutes and appoints Buyer and any officer or agent thereof, with full power of substitution, as its
true and lawful attorney-in-fact (coupled with an interest) with full irrevocable power and authority in the place and stead of Seller and in the name of Seller or in its own
name, from time to time in Buyer's discretion, for the purpose of carrying out the terms of this Agreement, to take any and all appropriate action and to execute any and all documents and instruments
which may be reasonably necessary or desirable to accomplish the purposes of this Agreement, and, without limiting the generality of the foregoing, each Seller hereby gives Buyer the power and right,
on behalf of Seller, without assent by, but with written notice to, Seller, to do the following: 

        (i)    in
the name of Seller, or in its own name, or otherwise, to take possession of and endorse and collect any checks, drafts, notes, acceptances or other instruments for
the payment of moneys due under any mortgage insurance or with respect to any other Purchased Items and to file any claim or to take any other action or proceeding in any court of law or equity or
otherwise deemed appropriate by Buyer for the purpose of collecting any and all such moneys due under any such mortgage insurance or with respect to any other Purchased Items whenever payable; 

66

  

        (ii)    to
pay or discharge taxes and Liens levied or placed on or threatened against the Purchased Items; 

        (iii)    (A)
to direct any party liable for any payment under any Purchased Items to make payment of any and all moneys due or to become due thereunder directly to Buyer or as
Buyer shall direct; (B) to ask or demand for, collect, receive payment of and receipt for, any and all moneys, claims and other amounts due or to become due at any time in respect of or arising
out of any Purchased Items; (C) to sign and endorse any invoices, assignments, verifications, notices and other documents in connection with any Purchased Items; (D) to commence and
prosecute any suits, actions or proceedings at law or in equity in any court of competent jurisdiction to collect the Purchased Items or any proceeds thereof and to enforce any other right in respect
of any Purchased Items; (E) to defend any suit, action or proceeding brought against Seller with respect to any Purchased Items; (F) to settle, compromise or adjust without Seller's
consent any suit, action or proceeding described in clause (E) above and, in connection therewith, to give such discharges or releases as Buyer may deem appropriate; and (G) generally,
to sell, transfer, pledge and make any agreement with respect to or otherwise deal with any Purchased Items as fully and completely as though Buyer were the absolute owner thereof for all purposes,
and to do, at Buyer's option and Seller's expense, at any time, and from time to time, all acts and things which Buyer deems necessary to protect, preserve or realize upon the Purchased Items and
Buyer's Liens thereon and to effect the intent of this Agreement, all as fully and effectively as Seller might do; 

        (iv)    to
direct the actions of the Custodian with respect to the Purchased Items under the Custodial Agreement; and 

        (v)    to
execute, from time to time, in connection with any sale provided for in Section 10.02, any endorsements, assignments or other instruments of conveyance or
transfer with respect to the Purchased Items. 

        Each
Seller hereby ratifies all that said attorneys shall lawfully do or cause to be done by the express terms hereof. This power of attorney is a power coupled with an interest and
shall be irrevocable. 

        (b)    The
powers conferred on Buyer hereunder are solely to protect Buyer's interests in the Purchased Items and Purchase Assets and shall not impose any duty upon it to
exercise any such powers. Buyer shall be accountable only for amounts that it actually receives as a result of the exercise of such powers, and neither it nor any of its officers, directors, employees
or agents shall be responsible to any Seller for any act or failure to act hereunder, except for its or their own gross negligence or willful misconduct. 

        Section
12.13    Legal Matters.    (a)    If there is any conflict between the terms of this Agreement or
any Transaction entered into hereunder and the Custodial Agreement, this Agreement shall prevail. 

        (b)    This
Agreement may be executed in any number of counterparts, all of which taken together shall constitute one and the same instrument, and any of the parties hereto may
execute this Agreement by signing any such counterpart. 

        (c)    The
captions and headings appearing herein are for included solely for convenience of reference and are not intended to affect the interpretation of any provision of
this Agreement. 

        (d)    Each
Seller hereby acknowledges that: 

        (i)    it
has been advised by counsel in the negotiation, execution and delivery of this Agreement and the other Repurchase Documents; 

        (ii)    Buyer
has no fiduciary relationship to any Seller; and 

        (iii)    no
joint venture exists between Buyer and any Seller. 

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        Section
12.14    Confidentiality.    Each Seller and Buyer hereby acknowledge and agree that all information regarding
the terms set forth in any of the Repurchase Documents or the Transactions contemplated thereby (the "Confidential Terms") shall be kept confidential
and shall not be divulged to any party without the prior written consent of such other party except to the extent that (i) it is necessary to do so in working with legal counsel, auditors,
taxing authorities or other governmental agencies or regulatory bodies or in order to comply with any applicable federal or state laws including, without limitation, federal securities laws applicable
to any Seller or any Affiliate thereof, (ii) any of the Confidential Terms are in the public domain other than due to a breach of this covenant, or (iii) in the event of a Default or an
Event of Default Buyer determines such information to be necessary or desirable to disclose in connection with the marketing and sales of the Purchased Assets or otherwise to enforce or exercise
Buyer's rights hereunder; provided, that nothing herein shall prevent any party from disclosing any such information (i) to any other party to
this Agreement, (ii) to any Transferee or potential Transferee which agrees to comply with the provisions of this Section, or (iii) to its Affiliates, employees, directors, agents,
attorneys, accountants and other professional advisors or other Persons deemed necessary or
appropriate in the reasonable judgment of the disclosing party, in each case who are made aware of and instructed to comply with the provisions of this Section 12.14; and,  provided, further, that no disclosure made with respect to any Repurchase Document shall include a copy
of such Repurchase Document to the extent that a summary would suffice in lieu thereof and in the event that it is necessary for a copy of any Repurchase Document to be disclosed, any specific terms
set forth in such Repurchase Document with respect to fees, pricing, advance rates and the like shall be redacted therefrom prior to disclosure of such Repurchase Document. The provisions set forth in
this section shall survive the termination of this Agreement for a period of one year following such termination. 

        Section
12.15.    Conflicts.    In the event of any conflict between the terms of this Agreement, any other Repurchase
Document and any Confirmation, the documents shall control in the following order of priority: first, the terms of the Confirmation shall prevail, then
the terms of this Agreement shall prevail, and then the terms of the other Repurchase Documents shall prevail. 

        Section
12.16    Right of Set-off.    In addition to any rights now or hereafter granted under applicable
law or otherwise, and not by way of limitation of such rights, each Seller hereby grants to Buyer a right of offset, to secure repayment of all amounts owing to Buyer by the Sellers under the
Repurchase Documents, upon any and all monies, securities, collateral or other property of Seller and the proceeds therefrom, now or hereafter held or received by Buyer or any entity under the control
of Buyer and their respective successors and assigns (including, without limitation, branches and agencies of Buyer, wherever located), for the account of Seller, whether for safekeeping, custody,
pledge, transmission, collection, or otherwise, and also upon any and all deposits (general or specified) and credits of Seller at any time existing. Buyer is hereby authorized at any time and from
time to time upon the occurrence and during the continuance of an Event of Default, without notice to any Seller, to offset, appropriate, apply and enforce such right of offset against any and all
items hereinabove referred to against any amounts owing to Buyer by the Seller under the Repurchase Documents, irrespective of whether Buyer shall have made any demand hereunder and although such
amounts, or any of them, shall be contingent or unmatured and regardless of any other collateral securing such amounts. Each Seller shall be deemed directly indebted to Buyer in the full amount of all
amounts owing to Buyer by the Seller under the Repurchase Documents, and Buyer shall be entitled to exercise the rights of offset provided for above. ANY AND ALL RIGHTS TO REQUIRE BUYER TO EXERCISE
ITS RIGHTS OR REMEDIES WITH RESPECT TO ANY OTHER COLLATERAL WHICH SECURES THE AMOUNTS OWING TO BUYER BY SELLER UNDER THE REPURCHASE DOCUMENTS, PRIOR TO EXERCISING ITS RIGHT OF OFFSET WITH RESPECT TO
SUCH MONIES, SECURITIES, COLLATERAL, DEPOSITS, CREDITS OR OTHER PROPERTY OF ANY SELLER, ARE HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED BY EACH SELLER. 

68

 

        Section
12.17    Treatment of Certain Information.    Notwithstanding anything to the contrary contained herein or in
any related document, all Persons may disclose to any and all Persons, without limitation of any kind, the federal income tax treatment of any of the transactions contemplated by this Repurchase
Agreement or any other related document, any fact relevant to understanding the federal
tax treatment of such transactions and all materials of any kind (including opinions or other tax analyses) relating to such federal income tax treatment. 

        Section
12.18    Increased Costs, Illegality, Etc.    (a)    In the event that Buyer shall have determined
(which determination shall, absent manifest error, be final and conclusive and binding upon all parties hereto): 

        (i)    on
any date that, by reason of any changes arising after the date of this Agreement affecting the interbank Eurodollar market, adequate and fair means do not exist for
ascertaining the applicable Pricing Rate on the basis provided for in the definition of Eurodollar Rate; or 

        (ii)    at
any time, that Buyer shall incur increased costs or reductions in the amounts received or receivable hereunder with respect to any Transaction because of
(x) any change since the date of this Agreement in any applicable law or governmental rule, regulation, order or request (whether or not having the force of law) (or in the interpretation or
administration thereof and including the introduction of any new law or governmental rule, regulation, order or request), such as, for example, but not limited to, (A) a change in the basis of
taxation of payments to Buyer in respect of any amounts payable hereunder (except for changes in the rate of tax on, or determined by reference to, the net income or profits of Buyer imposed by the
jurisdiction in which its principal office is located) or (B) a change in official reserve requirements, but, in all events, excluding reserves required under Regulation D to the extent
covered by Section 12.18(c) and/or (y) other circumstances arising after the date hereof, affecting Buyer or the interbank Eurodollar market or the position of Buyer in such market; or 

        (iii)    at
any time that the entering into or continuance of any Transaction, the Pricing Rate applicable to which is based upon the Eurodollar Rate, has been made
(x) unlawful by any law or governmental rule, regulation or order, (y) impossible by compliance by Buyer with any governmental request (whether or not having force of law) or
(z) impracticable as a result of a contingency occurring after the date of this Agreement which materially and adversely affects the interbank Eurodollar market; 

then,
and in any such event, Buyer shall promptly give notice thereof (by telephone confirmed in writing) to Seller. Thereafter (x) in the case of clause (i) above, Transactions, the
Pricing Rate applicable to which is based upon the Eurodollar Rate, shall no longer be available until such time as Buyer notifies Seller that the circumstances giving rise to such notice by Buyer no
longer exist, and any Transaction Request or Election Notice that is pending shall be deemed rescinded by the applicable Seller, and (y) in the case of clause (ii) above, Seller shall
pay to Buyer, upon written demand therefor, such additional amounts (in the form of an increased rate of, or a different method of calculating, interest or otherwise as Buyer in its sole discretion
shall determine) as shall be required to compensate Buyer for such increased costs or reductions in amounts received or receivable hereunder (a written notice as to the additional amounts owed to
Buyer, showing the basis for the calculation thereof, submitted to Seller by Buyer shall, absent manifest error, be final and conclusive and binding on all the parties hereto). 

        (b)    If
Buyer determines at any time that any applicable law or governmental rule, regulation, order or request (whether or not having the force of law) adopted after the
date hereof concerning capital adequacy, or any change in interpretation or administration thereof by any governmental authority, central bank or comparable agency, will have the effect of increasing
the amount of capital required or expected to be maintained by Buyer based on the existence of Buyer's obligations hereunder, then Seller shall pay to Buyer, upon its written demand therefor, such
additional amounts 

69

 

as
shall be required to compensate Buyer for the increased cost to Buyer as a result of such increase of capital. In determining such additional amounts, Buyer will act reasonably and in good faith
and will use averaging and attribution methods which are reasonable and consistent with its policies and the policies of its holding company with respect to capital adequacy,  provided that Buyer's
determination of compensation owing under this Section 12.18(b) shall, absent manifest error, be final and conclusive and
binding on all the parties hereto. Buyer, upon determining that any additional amounts will be payable pursuant to this Section 12.18(b), will give prompt written notice thereof to Seller,
which notice shall show the basis for calculation of such additional amounts, although the failure to give any such notice shall not, subject to Section 12.18(d), release or diminish any of the
Seller's obligations to pay or cause the payment of additional amounts pursuant to this Section 12.18(b). 

        (c)    In
the event that Buyer shall determine (which determination shall, absent manifest error, be final and conclusive and binding on all the parties hereto) at any time
that by reason of Regulation D Buyer is required to maintain reserves in respect of any liabilities during any period that it has a Transaction, the Pricing Rate applicable to which is based
upon the Eurodollar Rate, outstanding (each such period, a "Eurocurrency Reserve Period"), then Buyer shall promptly give notice (by telephone confirmed
in writing) to Seller of such determination specifying the additional amounts required to indemnify Buyer against the cost of maintaining such reserves (such written notice to provide a computation of
such additional amounts), and Seller shall directly pay to Buyer such specified amounts as additional interest at the time that it is otherwise required to pay interest in respect of such Transaction
or, if later demanded by Buyer, promptly on demand. Buyer agrees that if it gives notice to Seller of the existence of a Eurocurrency Reserve Period, it shall promptly notify Seller of any termination
thereof, at which time Seller shall cease to be obligated to pay additional Price Differential to Buyer pursuant to the first sentence of this Section 12.18(c) until such time, if any, as a
subsequent Eurocurrency Reserve Period shall occur. 

[SIGNATURES
FOLLOW] 

70

        IN
WITNESS WHEREOF, the parties have entered into this Agreement as of the date set forth above. 

	 	 	SELLER
	

 	
 	
GRAMERCY CAPITAL CORP.
	

 	
 	

By:	

 
	 	 	 	
 Name:

Title:
	

 	
 	

 	

Address for Notices:

[                   ]
	

 	
 	

 	

Attn:

Telecopier No.:
		 	 	 
	
	 	 	 
	

 	
 	
GKK CAPITAL LP
	

 	
 	

By:	

 
	 	 	 	
 Name:

Title:
	

 	
 	

 	

Address for Notices:

[                   ]
	

 	
 	

 	

Attn:

Telecopier No.:
	

 	
 	
BUYER
	

 	
 	
[BUYER]
	

 	
 	

By:	

 
	 	 	 	
 Name:

Title:
	

 	
 	

 	
Address for Notices:

301 South College Street

Charlotte, North Carolina 28288

Attn:

Telecopier No.:

QuickLinks

Exhibit 10.8

TABLE OF CONTENTS

ACQUISITION REPURCHASE AGREEMENT

ARTICLE I APPLICABILITY

ARTICLE II DEFINITIONAL PROVISIONS

ARTICLE III INITIATION; TERMINATION

ARTICLE IV MARGIN MAINTENANCE

ARTICLE V INCOME PAYMENTS; REQUIREMENTS OF LAW

ARTICLE VI SECURITY INTEREST

ARTICLE VII PAYMENT, TRANSFER AND CUSTODY

ARTICLE VIII SELLER REPRESENTATIONS AND WARRANTIES

ARTICLE IX COVENANTS

ARTICLE X EVENTS OF DEFAULT; REMEDIES

ARTICLE XI SERVICING

ARTICLE XII MISCELLANEOUSQuickLinks
 -- Click here to rapidly navigate through this document

 
 

Exhibit 10.9

    
    

       

 
 

CREDIT AGREEMENT
  
  
  among
  
  
  GRAMERCY CAPITAL CORP.,
  and GKK CAPITAL LP,
  individually and collectively as Borrower,
  
  
  THE FINANCIAL INSTITUTIONS NAMED HEREIN,
  as Banks,

  
  
  and
  
  

[                                         
       ],
  as Administrative Agent
  
  
  with
  
  
  WACHOVIA CAPITAL MARKETS, LLC,
  as Sole Lead Arranger and Sole Book Manager
  
  
  Dated as of July    ,
2004    

 
 

TABLE OF CONTENTS    
    

	 
	 	 
	 	Page

	SECTION 1

DEFINITIONS AND PRINCIPLES OF CONSTRUCTION
	
1.01	
 	

Defined Terms	
 	

1
	1.02	 	Principles of Construction	 	19
	
SECTION 2

AMOUNT AND TERMS OF CREDIT
	
2.01	
 	

The Commitment	
 	

20
	2.02	 	The Loans	 	20
	2.03	 	Amount of Each Borrowing	 	20
	2.04	 	Notice of Borrowing	 	20
	2.05	 	Disbursement of Funds	 	21
	2.06	 	Notes	 	22
	2.07	 	Conversions	 	22
	2.08	 	Pro Rata Borrowings	 	22
	2.09	 	Interest	 	22
	2.10	 	Interest Periods	 	23
	2.11	 	Increased Costs, Illegality, Etc.	 	24
	2.12	 	Compensation	 	25
	2.13	 	Use of Proceeds, Etc.	 	26
	
SECTION 3

FEES
	
3.01	
 	

Fees	
 	

26
	
SECTION 4

PREPAYMENTS; PAYMENTS
	
4.01	
 	

Voluntary Prepayments	
 	

27
	4.02	 	Mandatory Prepayments	 	27
	4.03	 	Method and Place of Payment	 	28
	4.04	 	Net Payments	 	28
	4.05	 	Extension of Maturity Date	 	29
	
SECTION 5

SECURITY
	
5.01	
 	

Liens and Security Interests	
 	

30
	5.02	 	Agreement to Deliver Additional Collateral Documents	 	31
	5.03	 	Collection Account	 	31
	5.04	 	Payment of Costs and Expenses	 	31
	
SECTION 6

CONDITIONS PRECEDENT
	
6.01	
 	

No Default; Representations and Warranties	
 	

32
	6.02	 	Execution of Agreement; Notes	 	32
	 	 	 	 	 

	6.03	 	Notice of Borrowing	 	32
	6.04	 	Opinions of Counsel	 	32
	6.05	 	Borrower's Closing Certificate	 	33
	6.06	 	Governing Documents	 	33
	6.07	 	Incumbency Certificate	 	33
	6.08	 	Collateral Documents	 	33
	6.09	 	Borrowing Certificate	 	33
	6.10	 	Adverse Change, Etc.	 	33
	6.11	 	Borrowings	 	33
	6.12	 	Fees, Etc.	 	34
	6.13	 	Consummation of Transaction	 	34
	
SECTION 7

REPRESENTATIONS, WARRANTIES AND AGREEMENTS
	
7.01	
 	

Organization and Good Standing	
 	

35
	7.02	 	Authorization and Power	 	36
	7.03	 	No Conflicts or Consents	 	36
	7.04	 	Enforceable Obligations	 	36
	7.05	 	Agreements	 	36
	7.06	 	Solvency	 	36
	7.07	 	Governmental Approvals	 	36
	7.08	 	Financial Condition	 	37
	7.09	 	Full Disclosure	 	37
	7.10	 	No Default	 	37
	7.11	 	Material Adverse Event	 	37
	7.12	 	No Litigation	 	37
	7.13	 	Taxes	 	37
	7.14	 	No Plan Assets	 	37
	7.15	 	Compliance with Law	 	38
	7.16	 	Government Regulation	 	38
	7.17	 	Insider	 	38
	7.18	 	Fiscal Year	 	38
	7.19	 	Use of Proceeds; Margin Regulations	 	38
	7.20	 	The Collateral Documents	 	38
	7.21	 	Brokerage Fees	 	38
	7.22	 	Principal Place of Business; Location of Records; Federal Tax ID	 	38
	7.23	 	Office of Foreign Assets Control	 	39
	7.24	 	Patriot Act	 	39
	7.25	 	Certain Tax Matters	 	39
	7.26	 	REIT Status	 	39
	
SECTION 8

AFFIRMATIVE COVENANTS
	
8.01	
 	

Financial Statements, Reports and Documents	
 	

40
	8.02	 	Payment of Taxes	 	42
	8.03	 	Maintenance of Existence and Rights	 	43
	8.04	 	Other Notices	 	43
	8.05	 	Compliance with Loan Documents	 	43
	8.06	 	Operations and Properties	 	43
	8.07	 	Books and Records; Access	 	43
	8.08	 	Compliance with Law	 	43
	 	 	 	 	 

	8.09	 	REIT Status	 	43
	8.10	 	Insurance	 	44
	8.11	 	Authorizations and Approvals	 	44
	8.12	 	Maintenance of Liens	 	44
	8.13	 	Further Assurances	 	44
	8.14	 	ERISA	 	44
	8.15	 	Legal Separateness, Etc.	 	45
	
SECTION 9

NEGATIVE COVENANTS
	
9.01	
 	

Mergers, Etc.	
 	

46
	9.02	 	Negative Pledge	 	 
	9.03	 	Fiscal Year and Accounting Method	 	46
	9.04	 	Governing Documents	 	46
	9.05	 	Filing of Agreement	 	46
	9.06	 	Financial Covenants	 	46
	9.07	 	Additional Subsidiary Indebtedness	 	47
	9.08	 	Limitation on Distributions	 	47
	
SECTION 10

EVENTS OF DEFAULT
	
10.01	
 	

Events of Default	
 	

48
	10.02	 	Remedies Upon Event of Default	 	50
	10.03	 	Performance by Administrative Agent	 	51
	
SECTION 11

THE ADMINISTRATIVE AGENT
	
11.01	
 	

Appointment	
 	

51
	11.02	 	Administration of Loans by Administrative Agent	 	51
	11.03	 	Delegation of Duties	 	52
	11.04	 	Exculpatory Provisions	 	52
	11.05	 	Reliance by Administrative Agent	 	52
	11.06	 	Notice of Default	 	52
	11.07	 	Banks' Credit Decisions	 	53
	11.08	 	Administrative Agent's Reimbursement and Indemnification	 	53
	11.09	 	Administrative Agent in its Individual Capacity	 	53
	11.10	 	Holders	 	54
	11.11	 	Successor Administrative Agent	 	54
	11.12	 	Duties in the Case of Enforcement	 	54
	
SECTION 12

MISCELLANEOUS
	
12.01	
 	

Payment of Expenses, Etc; Indemnification	
 	

56
	12.02	 	Right of Setoff	 	57
	12.03	 	Notices	 	57
	12.04	 	Benefit of Agreement; Participations; Additional Banks; Register; New Notes; Etc.	 	58
	12.05	 	No Waiver; Remedies Cumulative	 	60
	12.06	 	Payments Pro Rata; Adjustments	 	60
	12.07	 	Calculations; Computations	 	61
	 	 	 	 	 

	12.08	 	Governing Law; Submission to Jurisdiction; Venue; Waiver of Jury Trial	 	62
	12.09	 	Counterparts	 	63
	12.10	 	Effectiveness	 	63
	12.11	 	Headings Descriptive	 	63
	12.12	 	Amendment, Waiver, Consent, Etc.	 	63
	12.13	 	Survival	 	64
	12.14	 	Domicile of Loans	 	64
	12.15	 	Audits of Borrowing Certificates	 	65
	12.16	 	Defaulting Banks	 	65
	12.17	 	Confidentiality	 	65
	12.18	 	Usury Laws	 	66
	12.19	 	Integration	 	66
	12.20	 	Joint and Several Liability	 	66
	12.21	 	The Administrative Agent's Appointment as Attorney-in-Fact	 	68
	12.22	 	Exculpation of Administrative Agent	 	69
	    	 	 	 	 

	SCHEDULES
 
	 	 
	 	 

	

SCHEDULE I	
 	

Commitments	
 	

 
	SCHEDULE II	 	Applicable Lending Offices	 	 
	SCHEDULE III	 	Collection Account	 	 
	    	 	 	 	 

	EXHIBITS
 
	 	 
	 	 

	

EXHIBIT A	
 	

Form of Notice of Borrowing	
 	

 
	EXHIBIT B	 	Form of Note	 	 
	EXHIBIT C	 	Form of Joinder Agreement	 	 
	EXHIBIT D	 	Form of Section 4.04(b)(ii) Certificate	 	 
	EXHIBIT E	 	Form of Assignment and Acceptance Agreement	 	 
	EXHIBIT F	 	Form of Pledge Agreement	 	 
	EXHIBIT G	 	Form of Custodial Agreement	 	 
	EXHIBIT H	 	Form of Borrowing Certificate	 	 
	EXHIBIT I	 	Form of Security Agreement	 	 
	EXHIBIT J	 	Form of Account Control Agreement	 	 
	EXHIBIT K	 	Borrowing Checklist	 	 
	EXHIBIT L	 	Form of Certificate of Responsible Officer	 	 

  

        CREDIT AGREEMENT, dated as of July [    ], 2004, among GRAMERCY CAPITAL CORP., a Maryland corporation and GKK CAPITAL LP,
a                        limited
partnership (individually and collectively, as the context may require, the "Borrower"), the financial institutions listed in Schedule I and each
other financial institution which has been assigned an interest hereunder pursuant to Section 12.04(c), as evidenced by an Assignment and Acceptance Agreement (each, a
"Bank" and, collectively, the "Banks"),
[                        ], acting in the manner
and to the extent described in Section 11 (in such capacity, the "Administrative Agent"), and WACHOVIA CAPITAL MARKETS, LLC, as Sole Lead
Arranger and Sole Book Manager. 

 
 

W I T N E S S E T H    
    

        WHEREAS, the Borrower has requested that the Banks make loans for the purpose of funding the cost of Liquidity Events (hereinafter defined) and the cost of the
acquisition of Eligible Assets (hereinafter defined); and 

        WHEREAS,
the Banks are willing to lend funds, subject to and upon the terms and conditions herein set forth; 

        NOW,
THEREFORE, IT IS AGREED: 

 
 

SECTION 1    
    
    DEFINITIONS AND PRINCIPLES OF CONSTRUCTION    
    

        1.01    Defined Terms.    As used in this Agreement, the following terms shall have the following meanings (such
meanings to be equally applicable to both the singular and plural forms of the terms defined): 

        "Account
Control Agreement" shall mean an Account Control Agreement, substantially in the form attached hereto as Exhibit J, among the Borrower and the Administrative Agent, for
the benefit of the Banks and the Bank (as that term is defined in the Account Control Agreement). 

        "Acquisition
Facility" shall mean that certain $50,000,000 revolving credit facility evidenced by that certain Acquisition Repurchase Agreement dated of even date herewith, by and
between Gramercy Capital Corp., a Maryland corporation and GKK Manager, LLC, a                        limited liability company,
as seller, and                        , as buyer (the "Acquisition Repurchase
Agreement"). 

        "Act
of Insolvency" shall mean, with respect to any Person, (i) the filing of a petition, commencing, or authorizing the commencement of any case or proceeding under any
bankruptcy, insolvency, reorganization, liquidation, dissolution or similar law relating to the protection of creditors, or suffering any such petition or proceeding to be commenced by another which
is consented to, not timely contested or results in entry of an order for relief (ii) the seeking or consenting to the appointment of a receiver, trustee, custodian or similar official for such
Person or any substantial part of the property of such Person; (iii) the appointment of a receiver, conservator, or manager for such Person by any governmental agency or authority having the
jurisdiction to do so; (iv) the making of a general assignment for the benefit of creditors; (v) the admission by such Person of its inability to pay its debts or discharge its
obligations as they become due or mature; or (vi) that any governmental authority or agency or any person, agency or entity acting or purporting to act under governmental authority shall have
taken any action to condemn, seize or appropriate, or to assume custody or control of, all or any substantial part of the property of such Person, or shall have taken any action to displace the
management of such Person or to curtail its authority in the conduct of the business of such Person. 

        "Adjusted
EBITDA" shall mean, for any Person, (a) EBITDA less (b) Loss Reserves for the applicable period. 

1

 

        "Administrative
Agent" shall have the meaning provided in the first paragraph of this Agreement and shall include any successor to the Administrative Agent appointed pursuant to
Section 11.11. 

        "Affiliate"
shall mean, with respect to any Person, any other Person directly or indirectly controlling, controlled by, or under direct or indirect common control with, such Person. A
Person shall be deemed to control another Person if such Person possesses, directly or indirectly, the power to direct or cause the direction of the management and policies of such other Person,
whether through the ownership of voting securities, by contract or otherwise. 

        "Agreement"
shall mean this Credit Agreement, as modified, supplemented and amended from time to time. 

        "Applicable
Lending Office" shall mean, with respect to each Bank, (i) such Bank's Base Rate Lending Office in the case of a Base Rate Loan and (ii) such Bank's Eurodollar
Lending Office in the case of a Eurodollar Rate Loan. 

        "Applicable
Margin" shall have the meaning given to such term in the Fee Letter. 

        "Approved
Banks" shall mean any bank, savings and loan association, savings institution, trust company or national banking association. 

        "Approved
Use" shall have the meaning provided in Section 2.13. 

        "Assignment
and Acceptance Agreement" shall mean the agreement and instrument contemplated in Section 12.04(c) hereof, pursuant to which any Bank assigns all or any portion of its
rights and obligations hereunder, which agreement shall be in the form of Exhibit E attached hereto. 

        "Associated
Value" shall mean, with respect to any Eligible Asset which the Borrower has identified to be pledged to the Administrative Agent for the benefit of the Banks as collateral
for Borrower's Obligations hereunder and under the other Loan Documents, the value of such Eligible Asset shall be the value as determined by the Administrative Agent in its sole and absolute
discretion; provided, however, that in the event that the Eligible Asset to be pledged was previously
the subject of a Transaction with proceeds under, and as that term is defined in, the Acquisition Facility or the Master Repo Facility, as applicable, the Associated Value of such Eligible Asset shall
be the Market Value most recently attributed thereto pursuant to, and as that term is defined in, the Acquisition Facility or the Master Repo Facility, as applicable, unless the Administrative Agent
shall have previously questioned such Market Value of the Eligible Asset, in which event the Associated Value of such Eligible Asset shall be the value assigned to such Eligible Asset by the
Administrative Agent in its sole and absolute discretion. 

        "Bank"
shall have the meaning provided in the first paragraph of this Agreement. 

        "Bank
Default" shall mean (i) the refusal (which has not been retracted) or the failure of a Bank to abide by any of its obligations under this Agreement (including without
limitation its obligation to make available its portion of any Borrowing), which refusal or failure, as the case may be, is not cured within ten (10) days of receipt from the Administrative
Agent of written notice thereof or (ii) a Bank
having notified in writing the Borrower and/or the Administrative Agent that such Bank does not intend to comply with its obligations under Section 2.01(a). 

        "Bank
Indemnitees" shall have the meaning provided in Section 12.01. 

        "Base
Rate" shall have the meaning provided in Section 2.09(a). 

        "Base
Rate Lending Office" shall mean, with respect to each Bank, the office of such Bank specified as its "Base Rate Lending Office" opposite its name on Schedule II or such
other office, Subsidiary or Affiliate of such Bank as such Bank may from time to time specify to the Borrower and the Administrative Agent. 

2

 

        "Base
Rate Loan" shall mean any Loan designated or deemed designated as such by the Borrower, as the case may be, at the time of the incurrence thereof or conversion thereto and bearing
interest as described in Section 2.09(a). 

        "Borrower"
shall have the meaning provided in the first paragraph of this Agreement; provided,  however, that each Newly Formed Subsidiary executing a Joinder
Agreement in the form of Exhibit C attached hereto shall, from and after the date
thereof, be collectively, together with Gramercy Capital Corp., GKK Manager, LLC, and any other such Newly Formed Subsidiary, a "Borrower" for purposes of this Agreement. 

        "Borrowing"
shall mean the borrowing of Loans of one Type from all the Banks on a given date (or the conversion of a Loan or Loans of a Bank or Banks on a given date). 

        "Borrowing
Certificate" shall mean a certificate of the Borrower substantially in the form of Exhibit H, setting forth (i) the use for which the Borrowing being requested
will be expended, and (ii) the Borrower's certification that such use is an Approved Use and is fully authorized under the Borrower's Governing Documents. 

        "Borrowing
Checklist" shall mean that certain checklist attached hereto as Exhibit K, pursuant to which                        .

        "Business
Day" shall mean (i) for all purposes other than as covered by clause (ii) below, any day on which commercial banks are open for business in New York and
Minnesota, solely with respect to the Custodial Agreement (or such other state where a successor custodian has its principal place of business), and (ii) with respect to all notices and
determinations in connection with, and payments of principal and interest on, Eurodollar Rate Loans, any day on which commercial banks are open in each of New York and London. 

        "Capital
Expenditures" shall mean, for any period, the product of (a) $0.15 multiplied times (b) the average number of square feet, during the period in question, in
improvements constituting part of Real Property Assets owned by the Parent and/or its Consolidated Subsidiaries with respect to which the Parent and/or its Consolidated Subsidiaries has financial
responsibility for recurring expenditures which are capitalized on the balance sheet of the Parent in conformity with GAAP, but expressly excluding portions of improvements which are leased to Persons
which are not Consolidated Subsidiaries who have responsibility for repair, maintenance and/or replacement in accordance with the applicable lease or otherwise. 

        "Capitalized
Lease Obligations" shall mean obligations under a lease that are required to be capitalized for financial reporting purposes in accordance with GAAP. The amount of a
Capitalized Lease Obligation is the capitalized amount of such obligation as would be required to be reflected on the balance sheet prepared in accordance with GAAP of the applicable Person as of the
applicable date. 

        "Capital
Stock" shall mean any and all shares, interests, participations or other equivalents (however designated) of capital stock of a corporation, any and all equivalent equity
ownership interests in a Person which is not a corporation, including, without limitation, any and all member or other equivalent interests in any limited liability company, and any and all warrants
or options to purchase any of the foregoing. 

        "Cash
and Cash Equivalents" shall mean (i) cash, (ii) direct obligations of the United States Government, including, without limitation, treasury bills, notes and bonds,
(iii) interest bearing or discounted obligations of Federal agencies and Government sponsored entities or pools of such instruments offered by Approved Banks and dealers, including without
limitation, Federal Home Loan Mortgage Corporation participation sale certificates, Government National Mortgage Association modified pass through certificates, Federal National Mortgage Association
bonds and notes, and 

3

 

Federal
Farm Credit System securities, (iv) time deposits, Domestic and Eurodollar certificates of deposit, bankers' acceptances, commercial paper rated at least A-1 by S&P and
P-1 by Moody's and/or guaranteed by a Person with an Aa1 rating by Moody's, a AA- rating by S&P or better rated credit, floating rate notes, other money market instruments and
letters of credit each issued by Approved Banks (provided that the same shall cease to be a "Cash or Cash Equivalent" if at any time any such bank shall
cease to be an Approved Bank), (v) obligations of domestic corporations, including, without limitation, commercial paper, bonds, debentures and loan participations, each of which is rated at
least AA- by S&P and/or Aa1 by Moody's and/or guaranteed by a Person with an Aa1 rating by Moody's and/or a AA- rating by S&P or better rated credit, (vi) obligations
issued by states and local governments or their agencies, rated at least MIG-1 by Moody's and/or SP-l by S&P and/or guaranteed by an irrevocable letter of credit of an Approved
Bank (provided that the same shall cease to be a "Cash or Cash Equivalent" if at any time any such bank shall cease to be an Approved Bank),
(vii) repurchase agreements with major banks and primary government security dealers fully secured by the U.S. Government or agency collateral equal to or exceeding the principal amount on a
daily basis and held in safekeeping, and (viii) real estate loan pool participations, guaranteed by a Person with an AA- rating given by S&P or Aa1 rating given by Moody's or better
rated credit. 

        "CERCLA"
shall mean the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as the same may be amended from time to time, 42 U.S.C. § 9601  et seq. 

        "Change
of Control of any Borrower" shall mean, with respect to any Borrower (with the exception of Parent and the Operating Partnership), any event or series of events which results in
Parent no longer owning one hundred percent (100%) of the Equity Interests of any such Borrower. 

        "Change
of Control of Parent" shall mean the occurrence of any of the following events: (a) prior to an internalization of management by Parent, if GGK Manager LLC is no longer
the manager of Parent, (b) after such time as Parent is internally managed, any "person" or "group" (within the meaning of Section 13(d) or 14(d) of the Securities Exchange Act of 1934,
as amended (the "Exchange Act")) shall become, or obtain rights (whether by means of warrants, options or otherwise) to become, the "beneficial owner"
(as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of a percentage of the total voting power of all classes of Capital Stock of the
Parent entitled to vote generally in the election of directors of 20% or more; or (c) the Parent shall cease to own and control, of record and beneficially, directly 100% of each class of
outstanding Capital Stock of each Newly Formed Subsidiary. Notwithstanding the foregoing, neither the
Administrative Agent, any Bank nor any other Person shall be deemed to approve or to have approved any internalization of management as a result of this definition or any other provision herein. 

        "Code"
shall mean the Internal Revenue Code of 1986, as amended from time to time, and the regulations promulgated and rulings issued thereunder. 

        "Collateral"
shall mean (i) all property (whether tangible or intangible) with respect to which any security interests have been granted by the Borrower (or purported to be
granted) to the Administrative Agent, on behalf of the Banks, pursuant to any security agreement (including, without limitation, any Pledge Agreement or Security Agreement) to secure the Obligations,
and (ii) [Purchased Items (as that term is defined in the Acquisition Repurchase Agreement)]. 

        "Collateral
Documents" shall mean each Pledge Agreement, Security Agreement, Account Control Agreement and each other security agreement, guaranty, financing statement or other documents
from time to time executed and delivered by the Loan Parties pursuant to such documents or otherwise pursuant to Section 5 (together with any documents or instruments amending or supplementing
same). 

        "Collection
Account" shall mean the account set forth on Schedule III established by the Borrower on behalf of the Administrative Agent and subject to an Account Control
Agreement, into which all Income shall be deposited. 

4

 

        "Commitment"
shall mean for each Bank, at any time, the amount set forth (i) opposite such Bank's name in Schedule I under the heading "Commitment" or (ii) if such
Bank is an Eligible Assignee or a transferee Bank under Section 12.04(c), in the applicable Assignment and Acceptance Agreement, in each case, as such amount may be adjusted from time to time
pursuant to the terms of this Agreement. 

        "Consolidated
Subsidiaries" shall mean any Subsidiary of Parent, or any other entity, which is consolidated with Parent in accordance with GAAP or which is required under GAAP to be
consolidated with Parent. 

        "Contingent
Liabilities" shall mean with respect to any Person(s) and all Subsidiaries thereof (without duplication): (i) liabilities and obligations (including any Guarantee
Obligations) of such Persons in respect of "off-balance sheet arrangements" (as defined in the SEC Off-Balance Sheet Rules) which would be required to be, or customarily would
be,
disclosed in the "Management's Discussion and Analysis of Financial Condition and Results of Operations" section of a Form 10-Q or Form 10-K (or their
equivalents) which any such Person (or any Affiliate thereof) is required to file with the Securities and Exchange Commission (or any Governmental Authority substituted therefore) other than bona fide
securitization transactions which fall into this category solely as a result of the application of FAS 140 or FIN 46, (ii) any obligation (including, without limitation, any Guarantee
Obligation) whether or not required to be disclosed in the footnotes to any such Person's financial statements, guaranteeing partially or in whole any Non-Recourse Indebtedness, lease,
dividend or other obligation, exclusive of contractual indemnities (including, without limitation, any indemnity or price-adjustment provision relating to the purchase or sale of securities or other
assets) and guarantees of non-monetary obligations (other than guarantees of completion, environmental indemnities and guarantees of customary carve-out matters made in
connection with Non-Recourse Indebtedness, such as fraud, misappropriation, bankruptcy and misapplication) which have not yet been called on or quantified, of such Person or of any other
Person, and (iii) any forward commitment or obligation to fund or provide proceeds with respect to any loan or other financing which is obligatory and non-discretionary on the part
of the lender. The amount of any Contingent Liabilities described in clause (ii) shall be deemed to be (a) with respect to a guarantee of interest or interest and principal, or operating
income guarantee, the sum of all payments required to be made thereunder (which in the case of an operating income guarantee shall be deemed to be equal to the debt service for the note secured
thereby, through (x) in the case of an interest or interest and principal guarantee, the stated date of maturity of the obligation (and commencing on the date interest could first be payable
thereunder), or (y) in the case of an operating income guarantee, the date through which such guarantee will remain in effect, and (b) with respect to all guarantees not covered by the
preceding clause (a), an amount equal to the stated or determinable amount of the primary obligation in respect of which such guarantee is made or, if not stated or determinable, the maximum
reasonably anticipated liability in respect thereof (assuming such Person is required to perform thereunder) as recorded on the balance sheet and on the footnotes to the most recent financial
statements of such Person. As used in this definition, the term "SEC Off-Balance Sheet Rules" means the Disclosure in Management's Discussion and Analysis About Off Balance Sheet
Arrangements, Securities Act Release No. 33-8182, 68 Fed. Reg. 5982 (Feb. 5, 2003) (codified at 17 CFR pts. 228, 229 and 249). 

        "Conversion"
shall have the meaning provided in Section 2.07. 

        "Cost
of Funds" shall mean the per annum rate of interest which the Administrative Agent is required to pay, or is offering to pay, for
wholesale liabilities of like tenor, adjusted for reserve requirements and such other requirements as may be imposed by federal, state or local government and regulatory agencies, as determined by the
Administrative Agent. 

        "Custodial
Agreement" shall mean a custodial agreement, substantially in the form attached as Exhibit G hereto, by and among the Borrower, the Administrative Agent for the benefit
of the Banks 

5

 

and
the Custodian, as the same may be amended, restated, supplemented or otherwise modified and in effect from time to time. 

        "Custodian"
shall mean Wells Fargo Bank, N.A. and its successors in interest, as custodian under the Custodial Agreement, and any successor Custodian under the Custodial Agreement. 

        "Debt
Service" shall mean, for any period, the sum of (a) Interest Expense of the Parent and its Subsidiaries determined on a consolidated basis for such period, and
(b) all regularly scheduled principal payments made with respect to Indebtedness of the Parent and its Subsidiaries during such period, other than any balloon, bullet, margin or similar
principal payment which repays such Indebtedness in full. Debt Service shall include a proportionate share of items (a) and (b) of all Unconsolidated Affiliates. 

        "Debtor
Relief Laws" shall mean any applicable liquidation, conservatorship, bankruptcy, moratorium, rearrangement, insolvency, fraudulent conveyance, reorganization, or similar laws
affecting the rights, remedies or recourse of creditors generally, including, without limitation, the Federal Bankruptcy Code and all amendments thereto, as are in effect from time to time. 

        "Default
Rate" shall mean a rate per annum equal to the interest rate applicable to Base Rate Loans  plus six percent (6.00%). 

        "Defaulting
Bank" shall mean any Bank with respect to which a Bank Default is in effect. 

        "Derivatives
Contract" shall mean any and all rate swap transactions, basis swaps, credit derivative transactions, forward rate transactions, commodity swaps, commodity options, forward
commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward bond price or forward bond index transactions, interest rate
options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions, cross-currency rate swap transactions, currency options, spot
contracts, or any other similar transactions or any combination of any of the foregoing (including any options to enter into any of the foregoing), whether or not any such transaction is governed by
or subject to any master agreement. Not in limitation of the foregoing, the term "Derivatives Contract" includes any and all transactions of any kind, and the related confirmations, which are subject
to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master
Agreement, or any other master agreement, including any such obligations or liabilities under any such master agreement. 

        "Derivatives
Termination Value" means, in respect of any one or more Derivatives Contracts, after taking into account the effect of any legally enforceable netting agreement relating to
such Derivatives Contracts, (a) for any date on or after the date such Derivatives Contracts have been closed out and termination value(s) determined in accordance therewith, such termination
value(s), and (b) for any date prior to the date referenced in clause (a) the amount(s) determined as the mark-to-market value(s) for such Derivatives Contracts,
as determined
based upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Derivatives Contracts (which may include the Administrative Agent or any
Bank). 

        "Distribution"
shall mean, with respect to any Person, a dividend that such Person has declared or paid or any equity capital returned to its stockholders or partners, or that such
Person has authorized or made any other distribution, payment or delivery of property (other than common stock or partnership interests of such Person) or cash to its stockholders or partners such, or
redeemed, retired, purchased or otherwise acquired, directly or indirectly, any shares of any class of its capital stock or any partnership interests outstanding on or after the Effective Date (or any
options or warrants issued by such Person with respect to its capital stock or partnership interests), or set aside any funds for any of the foregoing purposes, or shall have permitted any of its
Subsidiaries to purchase or otherwise acquire any shares of any class of the capital stock or any partnership interests of such Person outstanding on 

6

 

or
after the Effective Date (or any options or warrants issued by such Person with respect to its capital stock or partnership interests). Without limiting the foregoing, "Distributions" with respect
to any Person shall also include all payments made or required to be made by such Person with respect to any stock appreciation rights, plans, equity incentive or achievement plans or any similar
plans or setting aside of any funds for the foregoing purposes. 

        "Dollars"
and the sign "$" shall each mean freely transferable lawful money of the United States of America. 

        "EBITDA"
shall mean, for any period, determined with respect to any Person(s) on a consolidated basis, an amount equal to the sum of (a) net income (or loss) of such Person(s) for
such period determined on a consolidated basis (prior to any impact from minority interests and before deduction of Preferred Dividends on preferred stock, if any, of such Person(s)), in accordance
with GAAP, plus the following (but only to the extent actually included in determination of such net income (or loss)): (i) depreciation and amortization expense, (ii) interest expense,
(iii) income tax expense and (iv) extraordinary or non-recurring gains and losses; plus (b) each such Person's pro rata
share of EBITDA of its Unconsolidated Affiliates. EBITDA will be adjusted to remove all impact of FIN 46 and FAS 140 to the extent of related transfers to special purpose entities in connection
with bona fide securitizations of Mortgage Assets (as that term is defined in the Acquisition Repurchase Agreement). 

        "Effective
Date" shall have the meaning provided in Section 12.10. 

        "Eligible
Asset" shall have the meaning given to such term in the Acquisition Repurchase Agreement as in effect on the date hereof. 

        "Eligible
Assignee" shall mean any Person (other than the Borrower or an Affiliate of the Borrower) consented to as such by the Administrative Agent and so long as no Event of Default or
Incipient Default shall have occurred and be continuing, reasonably approved by the Borrower; provided that, in any event in either case, such consent
and/or approval shall not be unreasonably withheld or delayed. 

        "Employee
Benefit Plan" shall mean an "employee benefit plan" within the meaning of Section 3(3) of ERISA or "plan" within the meaning of Section 4975 of the Code. 

        "Environmental
Claims" shall mean any and all administrative, regulatory or judicial actions, suits, demands, demand letters, directives, claims, liens, notices of noncompliance or
violation, investigations or proceedings relating in any way to any Environmental Law or any permit issued, or any approval given, under any such Environmental Law (hereafter, "Claims"), including,
without limitation, (a) any and all Claims by governmental or regulatory authorities for enforcement, cleanup, removal, response, remedial or other actions or damages pursuant to any applicable
Environmental Law and (b) any and all Claims by any third party seeking damages, contribution, indemnification, cost recovery, compensation or injunctive relief in connection with alleged
injury or threat of injury to health, safety or the environment due to the presence of Hazardous Materials. 

        "Environmental
Law" shall mean any federal, state, foreign or local statute, law, rule, regulation, ordinance, code, guideline, written policy and rule of common law now or hereafter in
effect and in each case as amended, and any judicial or administrative interpretation thereof, including any judicial or administrative order, consent decree or judgment, relating to the environment,
employee health and safety or Hazardous Materials, including, without limitation, CERCLA; RCRA; the Federal Water Pollution Control Act, 33 U.S.C. § 1251 et
seq.; the Toxic Substances Control Act, 15 U.S.C. § 2601 et seq.; the Clean Air Act, 42 U.S.C. § 7401  et seq.; the Safe
Drinking Water Act, 42 U.S.C. § 3803 et seq.; the Oil Pollution Act of
1990, 33 U.S.C. § 2701 et seq.; the Emergency Planning and the Community Right-to-Know Act of 1986, 42 U.S.C.
§ 11001 et seq.; the Hazardous Material Transportation Act, 49 U.S.C. § 1801 et
seq. and the Occupational Safety and Health Act, 29 U.S.C. § 651 et seq.; and any state and local or foreign
counterparts or equivalents, in each case as amended from time to time. 

7

 

        "Equity
Interest" shall mean, with respect to any Person, any share of capital stock of (or other ownership or profit interests in) such Person, any warrant, option or other right for
the purchase or other acquisition from such Person of any share of capital stock of (or other ownership or profit interests in) such Person, any security convertible into or exchangeable for any share
of capital stock of (or other ownership or profit interests in) such Person or warrant, right or option for the purchase or other acquisition from such Person of such shares (or such other interests),
and any other ownership or profit interest in such Person (including, without limitation, partnership, member or trust interests
therein), whether voting or nonvoting, and whether or not such share, warrant, option, right or other interest is authorized or otherwise existing on any date of determination. 

        "Equity
Issuance" shall mean any issuance by a Person of any Equity Interest and shall in any event include the issuance of any Equity Interest upon the conversion or exchange of any
security constituting Indebtedness that is convertible or exchangeable, or is being converted or exchanged, for Equity Interests. 

        "ERISA"
shall mean the Employee Retirement Income Security Act of 1974, as amended from time to time, and the regulations promulgated and rulings issued thereunder. Section references to
ERISA are to ERISA, as in effect at the date of this Agreement, and to any subsequent provisions of ERISA, amendatory thereof, supplemental thereto or substituted therefor. 

        "ERISA
Affiliate" shall mean any person (as defined in Section 3(g) of ERISA) which, together with the Borrower, would be deemed to be a "single employer" within the meaning of
Section 414(b), (c), (m) or (o) of the Code. 

        "ERISA
Group" shall mean any Person (or Subsidiary thereof) and all members of a controlled group of corporations and all trades or businesses (whether or not incorporated) under common
control that, together with such person or any Subsidiary, are treated as a single employer under Section 414 of the Internal Revenue Code. 

        "Eurocurrency
Reserve Period" shall have the meaning provided in Section 2.11(d). 

        "Eurodollar
Lending Office" shall mean, with respect to each Bank, the office of such Bank specified as its "Eurodollar Lending Office" opposite its name on Schedule II or such
other office, Subsidiary or Affiliate of such Bank as such Bank may from time to time specify as such to the Borrower and the Administrative Agent. 

        "Eurodollar
Rate" shall mean, with respect to any Eurodollar Rate Loan, the rate per annum equal to the rate appearing at page 3750 of the Telerate Screen as one-month,
two-month or six-month LIBOR, as selected by Borrower in accordance with this Agreement, at or about 9:00 a.m., New York City time, three (3) Business Days prior
to the beginning of such Interest Period (and if such date is not a Business Day, the Eurodollar Rate in effect on the Business Day immediately preceding such date), and if such rate shall not be so
quoted, the average rate per annum at which three (3) mutually acceptable banks are offered Dollar deposits at or about 8:00 a.m., New York City time, on such date by prime banks in the
interbank eurodollar market where the eurodollar and foreign currency exchange operations in respect of its Eurodollar Rate Loans are then being conducted for delivery on such day for a period of
thirty (30) days and in an amount comparable to the amount of the Eurodollar Rate Loans to be outstanding on such day. The
Eurodollar Rate shall be reset by the Administrative Agent as described above and the Administrative Agent's determination of Eurodollar Rate shall be conclusive upon the parties absent manifest error
on the part of the Administrative Agent. 

8

   
        "Eurodollar Rate Loan" shall mean any Loan designated or deemed designated as such by the Borrower, as the case may be, at the time of the incurrence thereof or conversion thereto and
bearing interest as described in Section 2.09(b). 

        "Event
of Default" shall have the meaning provided in Section 10. 

        "Extension
Fee" shall mean the Fee to be paid by Borrower to the Administrative Agent in connection with the Extension Period as provided for in the Fee Letter. 

        "Extension
Notice" shall have the meaning set forth in Section 4.05 hereof. 

        "Extension
Period" shall have the meaning set forth in Section 4.05 hereof. 

        "Fair
Value" shall have the meaning provided in Appendix D to the Statement of Financial Accounting Standards No. 87. 

        "Federal
Funds Rate" shall mean for any day, the rate per annum (rounded upwards, if necessary, to the nearest 1/1000 of 1%) equal to the weighted average of the rates on overnight
Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank of New York on such day; provided that
(a) if such day is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding
Business Day, and (b) if no such rate is so published on such Business Day, the Federal Funds Rate for such day shall be the average of the quotations for such day for such transactions
received by the Administrative Agent from three Federal funds brokers of recognized standing and reputation reasonably selected by Administrative Agent. 

        "Fees"
shall mean those fees required to be paid by the Borrower pursuant to the terms of the Fee Letter. 

        "Fee
Letter" shall mean that certain Fee Letter dated as of July    , 2004 by and between Parent and the Administrative Agent, as the same may be amended, supplemented or
otherwise modified from time to time. 

        "Fixed
Charge Coverage Ratio" shall mean, for any Person during any period, the Adjusted EBITDA for such period divided by the Fixed Charges for the same period. 

        "Fixed
Charges" shall mean, for any Person during any period, the sum of (a) Debt Service, (b) all Preferred Dividends, (c) Capitalized Lease Obligations paid or
accrued during such period, (d) Capital Expenditures (if any), and (e) any amounts payable under any Ground Lease. Fixed Charges shall include a proportionate share of items (a), (b),
(c), (d) and (e) of all Unconsolidated Affiliates. 

        "Foreclosed
Loan" shall have the meaning given to such term in the Master Repurchase Agreement. 

        "Funds
from Operation" or "FFO" shall mean, for a given period, (a) Net Income of the Parent and its Subsidiaries for such period (before extraordinary and
non-recurring items), minus (or plus) (b) gains (or losses) from debt restructuring and sales of property during such period, plus (c) depreciation and amortization of real
and personal property assets for such period, plus (d) without duplication, income from unconsolidated partnerships and joint ventures, determined in each case in accordance with GAAP. 

        "Future
Commitment" shall have the meaning provided in Section 12.16(b). 

        "GAAP"
shall mean generally accepted accounting principles as in effect from time to time in the United States. 

9

 

        "Governing
Documents" shall mean, as to any Person, its articles or certificate of incorporation and by-laws, its partnership agreement, its certificate of formation and
operating agreement, and/or the other organizational or governing documents of such Person. 

        "Governmental
Authority" shall mean any government (or any political subdivision or jurisdiction thereof), court, bureau, agency or other governmental authority having jurisdiction over
the Borrower,
the Administrative Agent or any Bank, as applicable, or any of their respective businesses, operations or properties. 

        "Governmental
Plan" shall have the meaning specified in Section 3(32) of ERISA and/or Section 414(d) of the Code. 

        "Ground
Lease" shall mean a ground lease containing the following terms and conditions: (a) a remaining term (exclusive of any unexercised extension options) of thirty
(30) years or more from the Purchase Date of the Mortgage Asset; (b) the right of the lessee to mortgage and encumber its interest in the leased property without the consent of the
lessor; (c) the obligation of the lessor to give the holder of any mortgage Lien on such leased property written notice of any defaults on the part of the lessee and agreement of such lessor
that such lease will not be terminated until such holder has had a reasonable opportunity to cure or complete foreclosures, and fails to do so; (d) reasonable transferability of the lessee's
interest under such lease, including ability to sublease; and (e) such other rights customarily required by mortgagees making a loan secured by the interest of the holder of the leasehold
estate demised pursuant to a ground lease. 

        "Guarantee
Obligation" shall mean, as to any Person (the "guaranteeing person"), without duplication, any obligation of (a) the guaranteeing person or (b) another Person
(including, without limitation, any bank under any letter of credit) to induce the creation of an obligation for which the guaranteeing person has issued a reimbursement, counterindemnity or similar
obligation, in either case guaranteeing or in effect guaranteeing any Indebtedness, leases, dividends or other obligations (the "primary obligations") of any other third Person (the "primary obligor")
in any manner, whether directly or indirectly, including, without limitation, any obligation of the guaranteeing person, whether or not contingent, (i) to purchase any such primary obligation
or any property constituting direct or indirect security therefor, (ii) to advance or supply funds (1) for the purchase or payment of any such primary obligation or (2) to
maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor, (iii) to purchase property, securities or services
primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation or (iv) otherwise to assure or
hold harmless the owner of any such primary obligation against loss in respect thereof; provided, however, that the term Guarantee Obligation shall not include endorsements of instruments for deposit
or collection in the ordinary course of business. The terms "Guarantee" and "Guaranteed" used as a verb shall have a correlative meaning. 

        "Hazardous
Materials" shall mean (a) any petroleum or petroleum products, radioactive materials, asbestos in any form that is friable, urea formaldehyde foam insulation,
transformers or other equipment that contain dielectric fluid containing levels of polychlorinated biphenyls, and radon gas; (b) any chemicals, materials or substances defined as or included in
the definition of "hazardous substances," "hazardous waste," "hazardous materials," "extremely hazardous substances," "restricted hazardous waste," "toxic substances," "toxic pollutants,"
"contaminants," or "pollutants," or words of similar import, under any applicable Environmental Law; and (c) any other chemical, material or substance, the Release of which is prohibited,
limited or regulated by any governmental authority. 

        "Incipient
Default" shall mean an event which with the giving of notice or the passage of time or both would become an Event of Default. 

10

 

        "Income"
shall mean, with respect to any Eligible Asset at any time, all collections and proceeds on or in respect of the Eligible Asset, including, without limitation, any principal
thereof then payable and all interest or other distributions payable thereon less any related servicing fee(s) charged by Servicer. 

        "Indebtedness"
shall mean, for any Person, at the time of computation thereof, all of the following (without duplication): (a) all obligations of such Person in respect of money
borrowed (including without limitation principal, interest, assumption fees, prepayment fees, contingent interest, and other monetary obligations whether choate or inchoate); (b) all
obligations of such Person, whether or not for money borrowed (i) represented by notes payable, letters of credit, or drafts accepted, in each case representing extensions of credit,
(ii) evidenced by bonds, debentures, notes or similar instruments, or (iii) constituting purchase money indebtedness, conditional sales contracts, title retention debt instruments or
other similar instruments, upon which interest charges are customarily paid or that are issued or assumed as full or partial payment for property or services rendered; (c) Capitalized Lease
Obligations of such Person; (d) all reimbursement obligations of such Person under any letters of credit or acceptances (whether or not the same have been presented for payment); (e) all
"off-balance sheet arrangements" of such Person other than bona fide securitization transactions; (f) all obligations of such Person to purchase, redeem, retire, defease or
otherwise make any payment in respect of any Mandatory Redeemable Stock issued by such Person or any other Person (inclusive of forward equity contracts), valued at the greater of its voluntary or
involuntary liquidation preference plus accrued and unpaid dividends; (g) all obligations of such Person in respect of any keep well arrangements, credit enhancements, contingent or future
funding obligations under any Purchased Asset or any obligation senior to the Purchased Asset, unfunded interest reserve amount under any Purchased Asset or any obligation that is senior to the
Purchased Asset, purchase obligation, repurchase obligation, takeout commitment or forward equity commitment, in each case evidenced by a binding agreement (excluding any such obligation to the extent
the obligation can be satisfied by the issuance of Equity Interests (other than Mandatory Redeemable Stock)); (h) net obligations under any Derivative Contract not entered into as a hedge
against existing Indebtedness, in an amount equal to the Derivatives Termination Value thereof; (i) all Indebtedness of other Persons which such Person has Guaranteed or is otherwise recourse
to such Person (except for guaranties of customary exceptions for fraud, misapplication of funds, environmental indemnities and other similar exceptions to recourse liability (but not exceptions
relating to bankruptcy, insolvency, receivership or other similar events)); (j) all Indebtedness of another Person secured by (or for which the holder of such Indebtedness has an existing
right, contingent or otherwise, to be secured by) any Lien on property or assets owned by such Person, even though such Person has not assumed or become liable for the payment of such Indebtedness or
other payment obligation; and (k) such Person's pro rata share of the Indebtedness of any Unconsolidated Affiliate of such Person. 

        "Indemnified
Party" shall have the meaning provided in Section 12.01(b). 

        "Interest
Coverage Rate" shall mean, as to any Person for any period, the ratio of (a) the Adjusted EBITDA of such Person to (b) the Interest Expense of such Person with
respect to the same period. 

        "Interest
Determination Date" shall mean, with respect to any Eurodollar Rate Loan, the third Business Day prior to the commencement of any Interest Period relating to such Eurodollar
Rate Loan. 

        "Interest
Expense" consists of any Person's total interest expense incurred (in accordance with GAAP), including capitalized or accruing interest (but excluding interest funded under a
construction loan), on a consolidated basis plus the Person's pro rata share of Interest Expense from Joint Venture Investments and Unconsolidated
Affiliates, without duplication for the most recent period. 

        "Interest
Period" shall have the meaning provided in Section 2.10. 

11

 

        "Interest
Rate Protection Agreements" shall mean, with respect to any or all o the Purchased Assets, any futures contract, options related contract, short sale of US Treasury securities
or any interest rate swap, cap, floor or collar agreement or any other similar arrangement providing for protection against fluctuations in interest rates or the exchange of nominal interest
obligations, either generally or under specific contingencies and acceptable to the Administrative Agent. 

        "Investment"
shall mean, with respect to any Person, any acquisition or investment (whether or not of a controlling interest) by such Person, whether by means of (a) the purchase
or other acquisition of any Equity Interest in another Person, (b) a loan, advance or extension of credit to, capital contribution to, guaranty or credit enhancement of Indebtedness of, or
purchase or other acquisition of any Indebtedness of, another Person, including any partnership or joint venture interest in such other Person, or (c) the purchase or other acquisition (in one
transaction or a series of transactions) of assets of another Person that constitute the business or a division or operating unit of another Person. Any binding commitment or option to make an
Investment in any other Person shall constitute an Investment. Except as expressly provided otherwise, for purposes of determining compliance with any covenant contained in any Wachovia Facility
document, the amount of any Investment shall be the amount actually invested, without adjustment for subsequent increases or decreases in the value of such Investment. 

        "IPO"
shall mean                        . 

        "Joint
Venture" shall mean                        . 

        "Legal
Requirements" shall mean all statutes, laws, rules, orders, regulations, ordinances, judgments, decrees and injunctions of Governmental Authorities affecting the Property or any
part thereof, or the construction, use, alteration or operation thereof, whether now or hereafter enacted and in force, and all permits, licenses, authorizations and regulations relating thereto, and
all covenants, agreements, restrictions and encumbrances contained in any instruments, either of record or known to Borrower, at any time in force affecting Borrower. 

        "Lien"
shall mean any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), preference, priority or other security agreement of any
kind or nature whatsoever (including, without limitation, any conditional sale or other title retention agreement, any financing or similar statement or notice filed under the UCC or any other similar
recording or notice statute, and any lease having substantially the same effect as any of the foregoing). 

        "Liquidity
Event" shall mean the exercise by the Buyer under, and as that term is defined in, the Acquisition Repurchase Agreement or the Master Repurchase Agreement, as applicable, of
its right to require the Seller to cure a Margin Deficit under, and as those terms are defined in, the Acquisition Repurchase Agreement or the Master Repurchase Agreement, as applicable. 

        "Loan"
shall have the meaning provided in Section 2.01(a). 

        "Loan
Documents" shall mean this Agreement, the Notes (including any renewals, extensions, reissuances and refundings thereof), each Joinder Agreement, if any, each Pledge Agreement,
each Security Agreement, each Account Control Agreement, each Assignment and Acceptance Agreement and any agreements or documents and such other agreements and documents, any amendments or supplements
thereto or modifications thereof executed or delivered pursuant to the terms of this Agreement or any of the other Loan Documents. 

        "Loan
Event" shall mean the making of any Loan (including the Conversion of any Loan pursuant to Section 2.07). 

        "Loan
Party" shall mean the Parent, the Operating Partnership and each Newly Formed Subsidiary, if any. 

12

 

        "Loss Reserves" shall mean, for any period an amount equal to [    ]. The Loss Reserves shall be
determined on an aggregate basis with respect to all assets of the Parent and its Subsidiaries and a proportionate share of all assets of all Unconsolidated Affiliates.

 

        "Losses"
shall have the meaning provided in Section 12.01(a). 

        "Management
Contract" shall mean that certain [Management Contract], dated as of July    , 2004, between
[                        ], as
                        , and
[                        ], as Manager, as the same may be amended, restated, supplemented or otherwise modified and in effect
from time to time.
 

        "Management
Fee" shall mean                        . 

        "Manager"
shall have the meaning assigned thereto in the Management Contract. 

        "Mandatory
Prepayment" shall mean any repayment of any Loan required pursuant to Section 4.02 hereof. 

        "Mandatory
Redeemable Stock" means, with respect to the Borrower or any Subsidiary, any Equity Interest of such Person which by the terms of such Equity Interest (or by the terms of any
security into which it is convertible or for which it is exchangeable or exercisable), upon the happening of any event or otherwise (a) matures or is mandatorily redeemable, pursuant to a
sinking fund obligation or otherwise (other than an Equity Interest to the extent redeemable in exchange for common stock or other equivalent common Equity Interests), (b) is convertible into
or exchangeable or exercisable for Indebtedness or Mandatory Redeemable Stock, or (c) is redeemable at the option of the holder thereof, in whole or in part (other than an Equity Interest which
is redeemable solely in exchange for common stock or other equivalent common Equity Interests); in each case, on or prior to the maturity date hereof or of the Acquisition Facility or the Master Repo
Facility. 

        "Margin
Stock" shall have the meaning provided in Regulations U and X of the Board of Governors of the Federal Reserve System. 

        "Master
Repo Facility" shall mean that certain $250,000,000.00 revolving credit facility evidenced by that certain Master Repurchase Agreement dated of even date herewith, by and between
                        , as seller, and Wachovia Capital Investment, Inc., as buyer (the "Master Repurchase Agreement").

        "Material
Adverse Event" shall mean any circumstances or events which (a) has had, or could reasonably be expected to have, a material adverse effect on the Borrower or on the
business, operations, property, assets, liabilities, condition (financial or otherwise) or prospects of the Borrower, (b) has had, or could reasonably be expected to have, any material adverse
effect whatsoever upon the validity, performance or enforceability of any of the Loan Documents or (c) has impaired or jeopardized, or could reasonably be expected to impair or jeopardize, the
obligation or ability of any Loan Party to fulfill its obligations under the Loan Documents. 

        "Maturity
Date" shall mean the earlier of (i) July    , 2006, as such date may be extended pursuant to Section 4.05 hereof, subject in any event to acceleration
pursuant to Section 10.02 hereof, and (ii) the termination, maturity or earlier acceleration of the Master Repo Facility and/or the Acquisition Facility. 

        "Moody's"
shall mean Moody's Investors Service, Inc. or, if Moody's Investors Service, Inc. is no longer issuing ratings, another nationally recognized rating agency
reasonably acceptable to the Administrative Agent. 

        "Mortgage
Asset" shall have the meaning given to such term in the Master Repurchase Agreement. 

13

 

        "Net
Income" shall mean, with respect to any Person for any period, the net income of such Person for such period as determined in accordance with GAAP. 

        "Newly
Formed Subsidiary" shall mean a newly formed wholly-owned Subsidiary of the Parent established for the sole purpose of acquiring title to an Eligible Asset in accordance with the
terms of this Agreement, which Newly Formed Subsidiary shall be a Special Purpose Entity to the extent required by the Administrative Agent in its sole and absolute discretion. 

        "Non-Defaulting
Bank" shall mean and include each Bank other than a Defaulting Bank. 

        "Non-Recourse
Indebtedness" shall mean, with respect to a Person, Indebtedness for borrowed money in respect of which recourse for payment (except for customary exceptions
for fraud, misapplication of funds, environmental indemnities, and other similar exceptions to recourse liability (but not exceptions relating to bankruptcy, insolvency, receivership or other similar
events)) is
contractually limited to specific assets of such Person encumbered by a Lien securing such Indebtedness. 

        "Note"
shall have the meaning provided in Section 2.06(a). 

        "Notice
of Borrowing" shall have the meaning provided in Section 2.04. 

        "Notice
of Conversion" shall have the meaning provided in Section 2.07. 

        "Notice
Office" shall mean the office of the Administrative Agent located at One Wachovia Center, 301 South College Street, Charlotte, North Carolina 28288, or such other office as the
Administrate Agent may hereafter designate in writing as such to the other parties hereto. 

        "Obligations"
shall mean all amounts owing or accruing to the Administrative Agent or any Bank pursuant to the terms of this Agreement or any other Loan Document. 

        "Operating
Partnership" shall mean GKK Capital LP, a                        limited partnership. 

        "Outstanding
Obligations" shall have the meaning provided in Section 4.02(a). 

        "Overall
Transaction" shall mean the transactions contemplated by the Loan Documents. 

        "PBGC"
shall mean the Pension Benefit Guaranty Corporation established pursuant to Section 4002 of ERISA, or any successor thereto. 

        "Parent"
shall mean Gramercy Capital Corp., a Maryland corporation. 

        "Participant"
shall have the meaning provided in Section 12.04(b). 

        "Payment
Date" shall mean (x) as to any Base Rate Loan, the first (1st) Business Day of each calendar month, and (y) as to any Eurodollar Rate Loan, the last Business Day
of the Interest Period for such Eurodollar Rate Loan [but in no event less than quarterly.] 

        "Payment
Office" shall mean the office of the Administrative Agent located at One Wachovia Center, 301 South College Street, 16th Floor, Charlotte, North Carolina 28288, or
such other office as the Administrative Agent may hereafter designate in writing as such to the other parties hereto. 

        "Percentage"
shall mean for each Bank the percentage determined by dividing such Bank's Commitment at such time by the Total Commitment at such time, it being understood that references
herein to the Commitment of a Bank and the Total Commitment at a time when such Commitment or the Total Commitment, as the case may be, has been terminated shall be references to such Commitment or
Total Commitment in effect immediately prior to such termination. 

        "Permitted
Assignee" shall mean a commercial bank or savings bank or similar financial institution, life insurance company, investment bank, pension fund, real estate investment trust or
similar institutional lender, or any subsidiary or affiliate thereof, or any subsidiary or affiliate thereof. 

14

 

        "Person"
shall mean any individual, limited liability company, partnership, joint venture, firm, corporation, association, trust or other enterprise or any government or political
subdivision or any agency, department or instrumentality thereof. 

        "Plan"
shall mean any pension plan as defined in Section 3(2) of ERISA, which is maintained or contributed to by (or to which there is an obligation to contribute of) the Borrower
or a Subsidiary of the Borrower or an ERISA Affiliate, and each such plan for the five year period immediately following the latest date on which the Borrower, or a Subsidiary of the Borrower or an
ERISA Affiliate maintained, contributed to or had an obligation to contribute to such plan. 

        "Plan
Assets" shall have the meaning provided in Appendix D to Statement of Financial Accounting Standards No. 87. 

        "Pledge
Agreement" shall have the meaning set forth in Section 5.01. 

        "Preferred
Dividends" shall mean, for any period and without duplication, all Restricted Payments paid or accrued during such period on Preferred Securities issued by the Parent or a
Subsidiary. Preferred Dividends shall not include dividends or distributions paid or payable (a) solely in Equity Interests (other than Mandatory Redeemable Stock) payable to holders of such
class of Equity Interests; (b) to the Parent or a Subsidiary; or (c) constituting or resulting in the redemption of Preferred Securities, other than scheduled redemptions not
constituting balloon, bullet or similar redemptions in full. 

        "Preferred
Securities" shall mean, with respect to any Person, Equity Interests in such Person that are entitled to preference or priority over any other Equity Interest in such Person
in respect of the payment (or accrual) of dividends or distribution of assets upon liquidation, or both. 

        "Prepayment
Trigger Event" shall have the meaning set forth in Section 4.02(b). 

        "Prime
Rate" shall mean the prime rate announced to be in effect from time to time by the Administrative Agent as its prime rate. The prime rate is not intended to be the lowest general
rate of interest charged by the Administrative Agent to its customers. 

        "Purchase
Date" shall mean                        . 

        "Purchased
Assets" shall mean                        . 

        "RCRA"
shall mean the Resource Conservation and Recovery Act, as the same may be amended from time to time, 42 U.S.C. § 6901 et
seq. 

        "Real
Property Assets" shall mean, as of any time, the real property assets (including interests in preferred equity and participating mortgages in which the lender's interest therein is
characterized as equity according to GAAP) owned directly or indirectly by Parent or a Consolidated Subsidiary at such time. 

        "Register"
shall have the meaning provided in Section 12.04(d). 

        "Regulation
D" shall mean Regulation D of the Board of Governors of the Federal Reserve System as from time to time in effect and any successor to all or a portion thereof or
other regulations relating to reserve requirements applicable to member banks of the Federal Reserve System. 

        "REIT"
shall mean a Person satisfying the conditions and limitations set forth in Section 856(b) and 856(c) of the Code which are necessary to qualify such Person as a "real
estate investment trust", as defined in Section 856(a) of the Code. 

        "Regulations
T, U and X" shall mean Regulations T, U and X of the Board of Governors of the Federal Reserve System (or any successor), as the same may be modified and supplemented and in
effect from time to time. 

15

 

        "Release"
shall mean the disposing, discharging, injecting, spilling, pumping, leaking, leaching, dumping, emitting, escaping, emptying, pouring or migrating, into or upon any land or
water or air, or otherwise entering into the environment. 

        "REO
Property" shall have the meaning given to such term in the Master Repurchase Agreement. 

        "Reportable
Event" shall mean any of the events set forth in Section 4043(c) of ERISA, other than those events as to which the thirty day notice period is waived under Sections
..21, .22, .23, .26, .27 or .28 of PBGC Reg. § 4043. 

        "Required
Banks" shall mean, at any time, Non-Defaulting Banks holding more than 662/3% of the then aggregate unpaid principal amount of the Notes then held by
Non-Defaulting Banks or, if no such principal amount is then outstanding, Non-Defaulting Banks holding more than 662/3% of the sum of the Commitments of
Non-Defaulting Banks. 

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

        "Responsible
Officer" shall mean, as to any Person, the chief executive officer, the chief financial officer, the chief accounting officer, the treasurer or the chief operating officer
of such Person. 

        "Restricted
Payment" shall mean (a) any dividend or other distribution, direct or indirect, on account of any Equity Interest of the Parent or any Subsidiary now or hereafter
outstanding, except a dividend payable solely in Equity Interests of identical class to the holders of that class; (b) any redemption, conversion, exchange, retirement, sinking fund or similar
payment, purchase or other acquisition for value, direct or indirect, of any Equity Interest of the Parent or any Subsidiary now or hereafter outstanding; and (c) any payment made to retire, or
to obtain the surrender of, any outstanding warrants, options or other rights to acquire any Equity Interests of the Parent or any Subsidiary now or hereafter outstanding. 

        "Rollover
Notice" shall have the meaning provided in Section 2.10. 

        "S&P"
shall mean Standard and Poor's Ratings Services, a division of The McGraw-Hill Companies, Inc. or, if Standard & Poor's Ratings Services is no longer
issuing ratings, another nationally recognized rating agency reasonably acceptable to the Administrative Agent. 

        "Section 4.04(b)(ii) Certificate"
shall have the meaning provided in Section 4.04(b)(ii). 

        "Secured
Indebtedness" shall mean, with respect to any Person, (a) all Indebtedness of such Person that is secured in any manner by any lien or encumbrance on any property  plus (b) such Person's
pro rata share of the Secured Indebtedness of any of such Person's
Unconsolidated Affiliates. 

        "Security
Agreement" shall have the meaning set forth in Section 5.01. 

        "Servicer"
shall have the meaning given to such term in the Acquisition Repurchase Agreement. 

        "SLG"
shall mean SL Green Realty Corp., a                        corporation. 

        "Sole
Book Manager" shall have the meaning set forth in Section 12.04(g). 

        "Sole
Lead Arranger" shall have the meaning set forth in Section 12.04(g). 

        "Special
Purpose Entity" shall mean any Newly Formed Subsidiary that has not, does not and will not: 

        (i)    engage
in any business or activity other than the ownership and maintenance of the Eligible Asset, and activities incidental thereto; 

        (ii)   acquire
or own any assets other than its Eligible Asset; 

16

 

        (iii)  merge
into or consolidate with any Person, or dissolve, terminate, liquidate in whole or in part, transfer or otherwise dispose of all or substantially all of its
assets or change its legal structure; 

        (iv)  fail
to observe all applicable organizational formalities, or fail to preserve its existence as an entity duly organized, validly existing and in good standing (if
applicable) under the applicable Legal Requirements of the jurisdiction of its organization or formation, or amend, modify, terminate or fail to comply with the provisions of its organizational
documents; 

        (v)   own
any subsidiary, or make any investment in, any Person; 

        (vi)  commingle
its assets with the assets of any other Person; 

        (vii) incur
any debt, secured or unsecured, direct or contingent (including guaranteeing any obligation), other than the Loan; 

        (viii) fail
to maintain its records, books of account, bank accounts, financial statements, accounting records and other entity documents separate and apart from those of
any other Person; except that any such Newly Formed Subsidiary's financial position, assets, liabilities, net worth and operating results may be included in the consolidated financial statements of
the Parent; 

        (ix)  enter
into any contract or agreement with any general partner, member, shareholder, principal, guarantor of the obligations of any such Newly Formed Subsidiary, or any
Affiliate of the foregoing, except upon terms and conditions that are intrinsically fair, commercially reasonable and substantially similar to those that would be available on an arm's-length basis
with unaffiliated third parties; 

        (x)   maintain
its assets in such a manner that it will be costly or difficult to segregate, ascertain or identify its individual assets from those of any other Person; 

        (xi)  assume
or guarantee the debts of any other Person, hold itself out to be responsible for the debts of any other Person, or otherwise pledge its assets for the benefit
of any other Person or hold out its credit as being available to satisfy the obligations of any other Person; 

        (xii) make
any loans or advances to any Person; 

        (xiii) fail
to file its own tax returns or files a consolidated federal income tax return with any Person (unless prohibited or required, as the case may be, by applicable
Legal Requirements), except to the extent that Borrower is treated as a "disregarded entity" for tax purposes and is not required to file tax returns under applicable law, or pay any taxes required to
be paid under applicable law; 

        (xiv) fail
to conduct its business solely in its own name; 

        (xv) fail
to maintain adequate capital for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business
operations; 

        (xvi) if
it is a partnership or limited liability company, without the unanimous written consent of all of its partners or members, as applicable (a) file or consent
to the filing of any petition, either voluntary or involuntary, to take advantage of any Debtor Relief Laws, (b) seek or consent to the appointment of a receiver, liquidator or any similar
official, (c) take any action that might cause such entity to become insolvent, (d) make an assignment for the benefit of creditors, or (e) allow any Lien to encumber its Eligible
Asset or any portion thereof; 

        (xvii) fail
to allocate shared expenses (including, without limitation, shared office space and services performed by an employee of an Affiliate) among the Persons sharing
such expenses or to use separate stationery, invoices and checks; 

17

 

        (xviii) fail
to remain solvent or pay its own liabilities (including, without limitation, salaries of its own employees) only from its own funds; 

        (xix) acquire
obligations or securities of its partners, members, shareholders or other affiliates, as applicable; or 

        (xx) fail
to maintain a sufficient number of employees in light of its contemplated business operations. 

        "Subsidiary"
shall mean, for any Person, any corporation, partnership, limited liability company or other entity (heretofore, now or hereafter established) of which at least a majority
of the securities or other ownership interests having by the terms thereof ordinary voting power to elect a majority of the board of directors or other persons performing similar functions of such
corporation, partnership, limited liability company or other entity (without regard to the occurrence of any contingency) is at the time directly or indirectly owned or controlled by such Person or
one or more Subsidiaries of such Person or by such Person and one or more Subsidiaries of such Person, and shall include all Persons the accounts of which are consolidated with those of such Person
pursuant to GAAP. 

        "Tangible
Net Worth": shall mean, as of a particular date: 

        (a)    all
amounts which would be included under capital (or any like caption) on a consolidated balance sheet of any Person(s) at such date, determined in accordance with
GAAP, less

        (b)    (i) amounts
owing to such Person(s) from any Affiliates thereof (other than "arm's length" loans to SLG), or from officers, employees, partners, members,
directors, shareholders or other Persons similarly affiliated with such Person(s) or their respective Affiliates, (ii) intangible assets [(other than Interest Rate Protection
Agreements specifically related to the Purchased Assets)], (iii) prepaid taxes and/or expenses and (iv) the value of any Mortgage Asset which, after its Purchase Date,
becomes REO Property. 

        "Tax
Based Accounting Principles" shall mean those generally accepted tax accounting principles and practices which are recognized as such in the United States for the purposes of
complying with filing and reporting obligations under the Code, and which are consistently applied for all periods, after the date hereof, so as to properly and fairly reflect the financial position
of the Borrower. 

        "Taxes"
shall have the meaning provided in Section 4.04(a). 

        "Termination
Event" shall mean                        . 

        "Total
Assets" shall mean, at any time, an amount equal to the aggregate book value of (a) all assets owned by any Person(s) (on a consolidated basis) and (b) the
proportionate share of assets owned by non-consolidated subsidiaries of such Person(s), less (i) amounts owing to such Person(s) from
any Affiliates thereof (other than arm's length loans to SLG), or from officers, employees, partners, members, directors, shareholders or other Persons similarly affiliated with such Person(s) or
their respective Affiliates, (ii) intangible assets [(other than Interest Rate Protection Agreements specifically related to the Purchased Assets)], and
(iii) prepaid taxes and/or expenses. 

        "Total
Commitment" shall mean, at any time, the sum of the Commitments of each of the Banks. [The Borrower shall be permitted to reduce the Total Commitment from time to time
so long as each such reduction is in an amount equal to not less than ten percent (10%) of the then existing Total Commitment.] 

        "Total
Indebtedness" shall mean, at any time, without duplication, all Indebtedness and Contingent Liabilities of any Person and all Subsidiaries thereof determined on a consolidated
basis, plus the pro rata share of Indebtedness and Contingent Liabilities of Unconsolidated Affiliates of such Person. 

18

 

        "Total
Liabilities Ratio" shall mean, as to any Person, the ratio of (a) the Total Indebtedness of such Person to (b) the Total Assets of such Person. 

        "Type"
shall mean any type of Loan determined with respect to the interest option applicable thereto, i.e., a Base Rate Loan or a
Eurodollar Rate Loan. 

        "UCC"
shall mean the Uniform Commercial Code as from time to time in effect in the relevant jurisdiction. 

        "Unconsolidated
Affiliates" shall mean, with respect to any Person, any other Person in whom such Person holds an Investment, which Investment is accounted for in the financial
statements of such Person on an equity basis of accounting and whose financial results would not be consolidated under GAAP with the financial results of such Person on the consolidated financial
statements of such Person. 

        "Unfunded
Current Liability" of any Plan shall mean the amount, if any, by which the value of the accumulated plan benefits under the Plan determined on a plan termination basis in
accordance with
actuarial assumptions at such time consistent with those prescribed by the PBGC for purposes of Section 4044 of ERISA, exceeds the fair market value of all plan assets allocable to such
liabilities under Title IV of ERISA (excluding any accrued but unpaid contributions). 

        "Uniform
Commercial Code" or "UCC" shall mean the Uniform Commercial Code as in effect on the date hereof in the State of New York; provided that if by reason of mandatory provisions of
law, the perfection, the effect of perfection or nonperfection, or the priority of the security interest in any Purchased Items is governed by the Uniform Commercial Code as in effect in a
jurisdiction other than New York. "Uniform Commercial Code" shall mean the Uniform Commercial Code as in effect in such other jurisdiction for purposes of the provisions hereof relating to such
perfection, effect of perfection or nonperfection, or priority. 

        "United
States" and "U.S." shall each mean the United States of America. 

        "Unsecured
Indebtedness" consists of Total Indebtedness that is not Secured Indebtedness. 

        "Wachovia
Facility" shall mean any of this Agreement, the Acquisition Facility or the Master Repo Facility. 

        1.02    Principles of Construction.    (a)    All references to sections, schedules and exhibits are to
sections, schedules and exhibits in or to this Agreement unless otherwise specified. The words "hereof," "herein" and "hereunder" and words of similar import when used in this Agreement shall refer to
this Agreement as a whole and not to any particular provision of this Agreement. 

        (b)   All
accounting terms not specifically defined herein shall be construed in accordance with (i) in the case of accounting terms specifically applicable to the
Borrower, Tax Based Accounting Principles, and (ii) in all other cases, generally accepted accounting principles. 

19

  

 
 

SECTION 2
  
  AMOUNT AND TERMS OF CREDIT    
    

        2.01    The Commitment.    

        (a)    Commitment Amount.    Subject to and upon the terms and conditions set forth herein, each Bank severally
agrees, at any time and from time to time prior to the Maturity Date, to extend a revolving line of credit in the form of loans (any loan made by any Bank a
"Loan" and Loans made by any Bank or by all the Banks, as the context requires, the "Loans") to the
Borrower; provided, however, that after giving effect to such extension, the aggregate principal amount
of Loans outstanding shall at no time exceed the Total Commitment, as then in effect. 

        (b)    Limitation on Borrowings and Conversions.    Notwithstanding anything to the contrary herein contained, the
Banks shall not be required to extend any Borrowing or effect any Conversion if: 

        (i)    after
giving effect to such Borrowing or Conversion, and the application of any proceeds from a Borrowing, the aggregate unpaid principal balance of the Loans would
exceed the Total Commitment; 

        (ii)   an
Event of Default or an Incipient Default has occurred and is continuing; 

        (iii)  a
Material Adverse Event has occurred and is continuing; or 

        (iv)  the
Management Contract has been amended or modified in any material respect without the prior written consent of the Administrative Agent, which consent it may
withhold in its sole and absolute discretion. 

        2.02    The Loans.    Subject to and upon the terms and conditions set forth herein, each Bank severally agrees, at
any time and from time to time prior to the Maturity Date, to make Loans to the Borrower, which Loans (a) shall, at the option of the Borrower, be Base Rate Loans or Eurodollar Rate Loans,  provided
that, except as otherwise specifically provided in Section 2.11(b), all Loans comprising the same Borrowing shall at all times be of the
same Type and (b) may be prepaid and reborrowed in accordance with the provisions hereof and (c) the aggregate principal amount of Loans outstanding from any Bank shall not exceed at any
one time such Bank's Commitment. More than one Borrowing may occur on the same date, but Eurodollar Rate Loans comprising more than five (5) Borrowings shall not be outstanding under this
Agreement at any time, it being understood and agreed that for purposes of this sentence, previously separate Eurodollar Rate Loans that are subsequently consolidated into a single Eurodollar Rate
Loan shall constitute one Borrowing. 

        2.03    Amount of Each Borrowing.    The aggregate principal amount of each Borrowing of Loans hereunder shall be not
less than $1,000,000 and increments of $1,000,000 thereafter, except as permitted or required by Sections 2.07 and 2.11(b), provided that the Borrower
shall be permitted to make no more than two Borrowings of Loans per calendar month. 

        2.04    Notice of Borrowing.    Whenever the Borrower desires to make a Borrowing of Loans hereunder, it shall give
the Administrative Agent at its Notice Office at least two (2) Business Days' prior irrevocable notice of each Base Rate Loan and at least three (3) Business Days' prior irrevocable
notice of each Eurodollar Rate Loan to be made hereunder, which notice shall be accompanied by a Borrowing Certificate and such other information as Administrative Agent may, in its reasonable
discretion, reasonably require (including, without limitation, any information required to be delivered to the Administrative Agent pursuant to Section 6.11 hereof),  provided that any such notice
shall be deemed to have been given on a certain day only if given before 11:00 A.M. (New York time) on such day.
The Borrowing Certificate delivered by the Borrower in connection with any Borrowing in respect of a Liquidity Event shall include (i) a certification from the Borrower stating that the
Borrower will, upon receipt of the proceeds of such Borrowing, have sufficient funds to satisfy such Liquidity Event, 

20

 

and
(ii) evidence (in the form of calculations) in detail acceptable to the Administrative Agent to support the certification referenced in clause (i) above. Each such notice (each, a
"Notice of Borrowing") shall be in the form of Exhibit A, appropriately completed to specify the aggregate principal amount of the Loans to be
made pursuant to such Borrowing, the date of such Borrowing (which shall be a Business Day), whether the Loans being made pursuant to such Borrowing are to be maintained initially as Base Rate Loans
or Eurodollar Rate Loans and, if Eurodollar Rate Loans, the initial Interest Period to be applicable thereto. The Administrative Agent shall promptly give each Bank notice of such proposed Borrowing,
of such Bank's proportionate share thereof and of the other matters required by the immediately preceding sentence to be specified in the Notice of Borrowing. Each Notice of Borrowing shall be deemed
to constitute a representation and warranty by the Borrower that the representations and warranties set forth in Section 7 are true and correct on and as of the date of such notice, with the
same force and effect as if made on and as of such date, except to the extent that such representations and warranties relate to an earlier date, in which case such Notice of Borrowing shall be deemed
to constitute a representation and warranty by the Borrower that such representations and warranties were true and correct on and as of such earlier date, and that no Event of Default or Incipient
Default has occurred and is continuing. 

        2.05    Disbursement of Funds.    (a)    Subject to the conditions set forth herein, no later than
11:00 A.M. (New York time) on the date specified in each Notice of Borrowing, each Bank will make available, through such Bank's Applicable Lending Office, its pro
rata portion of each Borrowing requested to be made on such date, in Dollars and in immediately available funds at the Payment Office of the Administrative Agent, and the
Administrative Agent will, upon the Administrative Agent's determination that the applicable conditions to making the requested Borrowing have been fulfilled, make available to the Borrower at its
Payment Office the aggregate of the amounts so made available by the Banks. Unless the Administrative Agent shall have been notified by any Bank prior to the date of any such Borrowing that such Bank
does not intend to make available to the Administrative Agent such Bank's portion of such Borrowing to be made on such date, the Administrative Agent may assume that such Bank has made such amount
available to the Administrative Agent on such date of Borrowing and the Administrative Agent may, in reliance upon such assumption, make available to the Borrower a corresponding amount;  provided that
the Administrative Agent shall have no obligation to make available to the Borrower amounts not received from any Bank. If such
corresponding amount is not in fact made available to the Administrative Agent by such Bank, the Administrative Agent shall be entitled to recover such corresponding amount from such Bank on demand.
If such Bank does not pay such corresponding amount forthwith upon the Administrative Agent's demand therefor, the Administrative Agent shall promptly notify the Borrower, and the Borrower shall pay
such corresponding amount to the Administrative Agent within one (1) Business Day of such notice, if such amount may be borrowed hereunder, and otherwise within three (3) Business Days
of such notice. The Administrative Agent shall also be entitled to recover on demand from such Bank, the interest on such corresponding amount in respect of each day from the date such corresponding
amount was made available by the Administrative Agent to the Borrower until the date such corresponding amount is recovered by the Administrative Agent, at a rate per
annum equal to (i) if recovered from such Bank, the Cost of Funds and (ii) if recovered from the Borrower, the Prime Rate in effect from time to time. Nothing in
this Section 2.05 shall be deemed to relieve any Bank from its obligation to make Loans hereunder or to prejudice any rights which the Borrower may have against any Bank as a result of any
failure by such Bank to make Loans hereunder. 

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

21

 

        2.06    Notes.    (a)    The Borrower's obligation to pay the principal of, and interest on, all the Loans
made by each Bank shall be evidenced by a promissory note duly executed and delivered by the Borrower substantially in the form of Exhibit B with blanks appropriately completed in conformity
herewith (each, a "Note" and, collectively, the "Notes"). The Note issued to each Bank shall
(i) be payable to the order of such Bank and be dated the Effective Date, (ii) be in a stated principal amount equal to the Commitment of such Bank and be payable in the principal amount
of the Loans evidenced thereby, (iii) mature, with respect to each Loan evidenced thereby, on the Maturity Date, (iv) bear interest as provided in the appropriate clause of
Section 2.09 in respect of the Base Rate Loans and Eurodollar Rate Loans, as the case may be, evidenced thereby and (v) be entitled to the benefits of this Agreement
and each of the other Loan Documents. Each Bank will note on its internal records the amount of each Loan made by it and each payment in respect thereof and will prior to any transfer of its Note
endorse on the reverse side thereof the outstanding principal amount of Loans evidenced thereby. Failure to make any such notation shall not affect the Borrower's obligations in respect of such Loans. 

        (b)   Upon
receipt of an affidavit of an officer of a Bank as to the loss, theft, destruction or mutilation of any Note or any other security document which is not of public
record, and, in the case of any such loss, theft, destruction or mutilation, upon surrender and cancellation of such Note or other security document, the Borrower will issue, in lieu thereof, a
replacement Note or other security document in the same principal amount thereof and otherwise of like tenor. 

        2.07    Conversions.    The Borrower shall have the option to convert on any Business Day all or any portion equal to
$1,000,000 or more of the outstanding principal amount of the Loans made pursuant to one or more Borrowings by the Borrower of one or more Types of Loan into a Borrowing of another Type of Loan (each,
a "Conversion"), provided that (i) except as otherwise provided in Section 2.11(b),
Eurodollar Rate Loans may be converted into Base Rate Loans only on the last day of an Interest Period applicable to the Eurodollar Rate Loans being converted, (ii) no partial conversion of
Eurodollar Rate Loans shall reduce the outstanding principal amount of Eurodollar Rate Loans made pursuant to a single Borrowing to less than $1,000,000, (iii) Base Rate Loans may only be
converted into Eurodollar Rate Loans if no Event of Default is in existence on the date of the Conversion, and (iv) no Conversion pursuant to this Section 2.07 shall result in a greater
number of Borrowings than is permitted under Section 2.02. Each such Conversion shall be effected by the Borrower, giving the Administrative Agent at its Notice Office prior to
11:00 A.M. (New York time) at least three (3) Business Days' prior notice (each, a "Notice of Conversion") specifying the Loans to be so
converted and, if any Loan is to be converted into a Eurodollar Rate Loan, the Interest Period to be initially applicable thereto. The Administrative Agent shall give each Bank prompt notice of any
such proposed Conversion affecting any of its Loans. Upon any such Conversion the proceeds thereof will be applied directly on the day of such Conversion to prepay the outstanding principal amount of
the Loans being converted. 

        2.08    Pro Rata Borrowings.    All Borrowings of Loans under this Agreement shall be incurred from the Banks  pro rata on the basis
of their respective Commitments. It is understood that no Bank shall be responsible for any default by any other Bank of its
obligation to make Loans hereunder and that each Bank shall be obligated to make the Loans provided to be made by it hereunder regardless of the failure of any other Bank to make its Loans hereunder. 

        2.09    Interest.    (a)    Each Base Rate Loan shall bear interest in respect of the unpaid principal
amount thereof from the date the proceeds thereof are made available to the Borrower until the maturity thereof (whether by acceleration or otherwise) at a rate per
annum (the "Base Rate") which shall be the greater of (x) the sum of (i) the Prime Rate in effect from time to
time plus (ii) the Applicable Margin or (y) 0.50% per annum in excess of the Federal Funds
Rate in effect from time to time. 

22

 

        (b)   Each
Eurodollar Rate Loan shall bear interest in respect of the unpaid principal amount thereof from the date the proceeds thereof are made available to the Borrower
until the maturity thereof (whether by acceleration or otherwise) at a rate per annum which shall, during each Interest Period applicable thereto, be
equal to the sum of (i) the Eurodollar Rate plus (ii) the Applicable Margin. 

        (c)   In
the event that, and for so long as, any Event of Default shall have occurred and be continuing, the outstanding principal amount of the Loans and, to the extent
permitted by law and subject to the following sentence, overdue interest in respect of each Loan and any other overdue amount payable by the Borrower hereunder, whether at stated maturity, when
required to be prepaid, upon acceleration or otherwise, shall bear interest, after as well as before judgment, at a rate per annum equal to the Default
Rate. 

        (d)   In
the event that any payment of principal or interest herein provided for shall become overdue beyond any applicable grace period, a "late charge" of five percent (5%)
of the overdue payment shall become immediately due and payable to the Administrative Agent, for the pro rata benefit of all of the Banks, as liquidated
damages for failure to make prompt payment. The imposition or payment of any such late charge shall not affect in any way the availability of any right or remedy that is otherwise available to the
Administrative Agent or the Banks under any of the Loan Documents or applicable law. 

        (e)   Accrued
(and theretofore unpaid) interest shall be payable (i) in respect of each Loan, in arrears on each applicable Payment Date, (ii) in respect of each
Loan, on any prepayment (on the amount prepaid), and (iii) at maturity, whether by acceleration or otherwise, and after such maturity, on demand. 

        (f)    On
each Interest Determination Date, the Administrative Agent shall determine the interest rate for the Eurodollar Rate Loans for which such determination is being made
and shall promptly notify the Borrower and the Banks thereof. Each such determination shall, absent manifest error, be final and conclusive and binding on all parties hereto. 

        2.10    Interest Periods.    At the time it gives any Notice of Borrowing or Notice of Conversion in respect of the
making of, or conversion into, any Eurodollar Rate Loan (in the case of the initial Interest Period applicable thereto) or on the third Business Day prior to the expiration of an Interest Period
applicable to such Eurodollar Rate Loan (in the case of any subsequent Interest Period), the Borrower shall have the right to elect, by giving the Administrative Agent notice thereof (such notice, a
"Rollover Notice"), the interest period (each, an "Interest Period") applicable to such Eurodollar Rate
Loan, which Interest Period shall, at the option of the Borrower, be, in the case of any Eurodollar Rate Loan, a one, two, three or six-month period,  provided that: (i) all Eurodollar Rate Loans
comprising a Borrowing shall at all times have the same Interest Period except as otherwise required
by Section 2.11(b); (ii) the initial Interest Period for any Eurodollar Rate Loan shall commence on the date of Borrowing of such Loan (including the date of any Conversion thereof from
a Base Rate Loan) and each Interest Period occurring thereafter in respect of such Loan shall commence on the day on which the next preceding Interest Period applicable thereto expires;
(iii) if any Interest Period relating to a Eurodollar Rate Loan begins on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period,
such Interest Period shall end on the last Business Day of such calendar month; (iv) if any Interest Period would otherwise expire on a day which is not a Business Day, such Interest Period
shall expire on the next succeeding Business Day, provided that if any Interest Period for a Eurodollar Rate Loan would otherwise expire on a day which
is not a Business Day but is a day of the month after which no further Business Day occurs in such month, such Interest Period shall expire on the next preceding Business Day; and (v) no
Interest Period shall extend beyond the Maturity Date. If upon the expiration of any Interest Period applicable to a Eurodollar Rate Loan, the Borrower has failed to elect a new Interest Period to be
applicable to such 

23

 

Eurodollar
Rate Loan as provided above, the Borrower shall be deemed to have elected an Interest Period with a duration of one (1) month. 

        2.11    Increased Costs, Illegality, Etc.    (a)    In the event that any Bank shall have determined (which
determination shall, absent manifest error, be final and conclusive and binding upon all parties hereto but, with respect to clause (i) below, may be made only by the Administrative Agent): 

        (i)    on
any Interest Determination Date that, by reason of any changes arising after the date of this Agreement affecting the interbank Eurodollar market, adequate and fair
means do not exist for ascertaining the applicable interest rate on the basis provided for in the definition of Eurodollar Rate; or 

        (ii)   at
any time, that such Bank shall incur increased costs or reductions in the amounts received or receivable hereunder with respect to any Eurodollar Rate Loan because
of (x) any change since the date of this Agreement in any applicable law or governmental rule, regulation, order or request (whether or not having the force of law) (or in the interpretation or
administration thereof and including the introduction of any new law or governmental rule, regulation, order or request), such as, for example, but not limited to, (A) a change in the basis of
taxation of payments to any Bank or its Applicable Lending Office of the principal of, or interest on, the Notes or any other amounts payable hereunder (except for changes in the rate of tax on, or
determined by reference to, the net income or profits of
such Bank or its Applicable Lending Office imposed by the jurisdiction in which its principal office or Lending Office is located) or (B) a change in official reserve requirements, but, in all
events, excluding reserves required under Regulation D to the extent covered by Section 2.11(d) and/or (y) other circumstances arising after the date hereof, affecting such Bank
or the interbank Eurodollar market or the position of such Bank in such market; or 

        (iii)  at
any time, that the making or continuance of any Eurodollar Rate Loan has been made (x) unlawful by any law or governmental rule, regulation or order,
(y) impossible by compliance by such Bank with any governmental request (whether or not having force of law) or (z) impracticable as a result of a contingency occurring after the date of
this Agreement which materially and adversely affects the interbank Eurodollar market; 

then,
and in any such event, such Bank (or the Administrative Agent, in the case of clause (i) above) shall promptly give notice (by telephone confirmed in writing) to the Borrower and, except
in the case of clause (i) above, to the Administrative Agent of such determination (which notice the Administrative Agent shall promptly transmit to each of the other Banks). Thereafter
(x) in the case of clause (i) above, Eurodollar Rate Loans shall no longer be available until such time as the Administrative Agent notifies the Borrower and the Banks that the
circumstances giving rise to such notice by the Administrative Agent no longer exist, and any Notice of Borrowing or Notice of Conversion given by the Borrower with respect to Eurodollar Rate Loans
which have not yet been incurred (including by way of Conversion) shall be deemed rescinded by the Borrower, (y) in the case of clause (ii) above, the Borrower shall pay to such Bank,
upon written demand therefor, such additional amounts (in the form of an increased rate of, or a different method of calculating, interest or otherwise as such Bank in its sole discretion shall
determine) as shall be required to compensate such Bank for such increased costs or reductions in amounts received or receivable hereunder (a written notice as to the additional amounts owed to such
Bank, showing the basis for the calculation thereof, submitted to the Borrower by such Bank shall, absent manifest error, be final and conclusive and binding on all the parties hereto) and
(z) in the case of clause (iii) above, take one of the actions specified in Section 2.11(b) as promptly as possible and, in any event, within the time period required by law. 

        (b)   At
any time that any Eurodollar Rate Loan is affected by the circumstances described in Section 2.11 (a)(ii) or (iii), the Borrower may (and in the case of
a Eurodollar Rate Loan affected by 

24

 

the
circumstances described in Section 2.11 (a)(iii) shall) either (x) if the affected Eurodollar Rate Loan is then being made initially or pursuant to a Conversion, cancel said
Borrowing by giving the Administrative Agent notice by telephone (confirmed in writing) of the cancellation on the same date that the Borrower was notified by the Bank or the Administrative Agent
pursuant to Section 2.11(a)(ii) or (iii) or (y) if the affected Eurodollar Rate Loan is then outstanding, upon at least three (3) Business Days' written notice to
the Administrative Agent, require the affected Bank to convert such Eurodollar Rate Loan into a Base Rate Loan or Loans, provided that, if more than one
Bank is affected at any time, then all affected Banks must be treated the same pursuant to this Section 2.11(b). 

        (c)   If
any Bank determines at any time that any applicable law or governmental rule, regulation, order or request (whether or not having the force of law) adopted after the
date hereof concerning capital adequacy, or any change in interpretation or administration thereof by any governmental authority, central bank or comparable agency, will have the effect of increasing
the amount of capital required or expected to be maintained by such Bank based on the existence of such Bank's Commitment hereunder or its obligations hereunder, then the Borrower shall pay to such
Bank, upon its written demand therefor, such additional amounts as shall be required to compensate such Bank for the increased cost to such Bank as a result of such increase of capital. In determining
such additional amounts, each Bank will act reasonably and in good faith and will use averaging and attribution methods which are reasonable and consistent with its policies and the policies of its
holding company with respect to capital adequacy, provided that such Bank's determination of compensation owing under this Section 2.11(c) shall,
absent manifest error, be final and conclusive and binding on all the parties hereto. Each Bank, upon determining that any additional amounts will be payable pursuant to this Section 2.11(c),
will give prompt written notice thereof to the Borrower, which notice shall show the basis for calculation of such additional amounts, although the failure to give any such notice shall not, subject
to Section 2.11(e), release or diminish any of the Borrower's obligations to pay or cause the payment of additional amounts pursuant to this Section 2.11(c). 

        (d)   In
the event that any Bank shall determine (which determination shall, absent manifest error, be final and conclusive and binding on all the parties hereto) at any time
that by reason of Regulation D such Bank is required to maintain reserves in respect of Eurocurrency loans or liabilities during any period that it has a Eurodollar Rate Loan outstanding (each
such period, for any Bank, a "Eurocurrency Reserve Period"), then such Bank shall promptly give notice (by telephone confirmed in writing) to the Borrower and to the Administrative Agent of such
determination (which notice the Administrative Agent shall promptly transmit to each of the other Banks) specifying the additional amounts required to indemnify such Bank against the cost of
maintaining such reserves (such written notice to provide a computation of such additional amounts), and the Borrower shall directly pay to such Bank such specified amounts as additional interest at
the time that it is otherwise required to pay interest in respect of such Eurodollar Rate Loan or, if later demanded by the Bank, promptly on demand. Each Bank agrees that if it gives notice to the
Borrower of the existence of a Eurocurrency Reserve Period, it shall promptly notify the Borrower of any termination thereof, at which time the Borrower shall cease to be obligated to pay additional
interest to such Bank pursuant to the first sentence of this Section 2.11(d) until such time, if any, as a subsequent Eurocurrency Reserve Period shall occur. 

        2.12    Compensation.    The Borrower shall compensate each Bank, upon its written request (which request shall set
forth the basis for requesting such compensation and shall, absent manifest error, be final and conclusive and binding on all the parties hereto), for all reasonable losses, expenses and liabilities
(including, without limitation, any loss, expense or liability incurred by reason of the liquidation or redeployment of deposits or other funds required by such Bank to fund its Eurodollar Rate Loans
but excluding loss of anticipated profits) which such Bank may sustain: (i) if for any reason (other than a default by such Bank or the Administrative Agent) a Borrowing of, or Conversion from 

25

 

or
into, Eurodollar Rate Loans does not occur on a date specified therefor in a Notice of Borrowing or Notice of Conversion (whether or not withdrawn by the Borrower or deemed rescinded pursuant to
Section 2.11(a)); (ii) if any repayment (including any prepayment made pursuant to Section 4) or Conversion of any of its Eurodollar Rate Loans occurs on a date which is not the
last day of an Interest Period with respect thereto; (iii) if any prepayment of any of its Eurodollar Rate Loans is not made on any date specified in a notice of prepayment given by the
Borrower; or (iv) as a consequence of (x) any other default by the Borrower to repay its Loans when required by the terms of this Agreement or the Note of such Bank or (y) any
action taken pursuant to Section 2.11(b). 

        2.13    Use of Proceeds, Etc.    Borrower may request and use Loan proceeds solely and exclusively for the purpose
(and for no other purpose, express or implied) of (i) the acquisition of Eligible Assets in accordance with, and subject in all respects with, the terms and conditions applicable to the
acquisition of Eligible Assets as set forth in the Acquisition Repurchase Agreement (including, without limitation, those set forth in Sections    ,    and    of the
Acquisition Repurchase Agreement), and (ii) satisfying a Liquidity Event (in either event, an "Approved Use"). Neither the Banks nor the
Administrative Agent shall have any liability, obligation, or responsibility whatsoever with respect to the Borrower's use of the proceeds of the Loans, and neither the Banks nor the Administrative
Agent shall be obligated to determine whether or not the Borrower's use of the proceeds of the Loans are for purposes permitted under the Borrower's Governing Documents. Nothing, including, without
limitation, any Borrowing, any Conversion or any acceptance of any other document or instrument, shall be construed as a representation or warranty, express or implied, to any party by the Banks or
the Administrative Agent as to whether any investment by the Borrower qualifies under this Agreement or is otherwise permitted by the terms of the Borrower's Governing Documents. 

 
 

SECTION 3
  
  FEES    
    

        3.01    Fees.    The Borrower agrees to pay to the Administrative Agent each of the Fees provided for in the Fee
Letter when and as due, all of which Fees shall be irrevocable and nonrefundable. 

26

  

 
 

SECTION 4
  
    PREPAYMENTS; PAYMENTS    
    

        4.01    Voluntary Prepayments.    The Borrower shall have the right to prepay the Loans, without premium or penalty,
in whole or in part from time to time on the following terms and conditions: (i) the Borrower shall give the Administrative Agent prior to 1:00 P.M. (New York time) at its Notice Office
(x) at least one Business Day's prior written notice (such notice to be accompanied by a Borrowing Certificate) of its intent to prepay Base Rate Loans and (y) at least three
(3) Business Days' prior written notice (such notice to be accompanied by a Borrowing Certificate) of its intent to prepay Eurodollar Rate Loans, the amount of such prepayment and the Types of
Loans to be prepaid and, in the case of Eurodollar Rate Loans, the specific Borrowing or Borrowings pursuant to which made, which notice and Borrowing Certificate the Administrative Agent shall
promptly transmit to each of the Banks; (ii) in the case of Loans, each prepayment shall be in an aggregate principal amount of at least $1,000,000,  provided that no partial prepayment of
Eurodollar Rate Loans made pursuant to any Borrowing shall reduce the outstanding Loans made pursuant to such
Borrowing to an amount less than [$                        ]; (iii) each prepayment of Eurodollar Rate Loans made pursuant to
this Section 4.01 which occurs on a date
which is not the last day of the Interest Period applicable thereto shall be subject to the provisions of Section 2.12; and (iv) each prepayment in respect of any Loans made pursuant to
a Borrowing shall be applied pro rata among such Loans. The Borrower may at any time by written notice to the Administrative Agent terminate this
Agreement and the Commitments, subject to Section 12.13, if no Obligations are then outstanding. 

        4.02    Mandatory Prepayments.    (a)    If at any time the aggregate outstanding principal amount of the
Loans (the "Outstanding Obligations") exceeds the Total Commitment, as then in effect, subject to paragraph (e) below, the Borrower shall prepay
the principal of the Loans (within five (5) Business Days) in an amount equal to such excess. The Administrative Agent shall promptly notify the Borrower of any action taken by the
Administrative Agent pursuant to the preceding sentence. 

        (b)    In
the event that any Eligible Asset acquired with the proceeds of the Loan no longer meet the criteria for an Eligible Asset, as provided for in the Acquisition
Repurchase Agreement (a "Prepayment Trigger Event"), the Borrower shall, within five (5) Business Days of such Prepayment Trigger Event, prepay
the principal of the Loans in an amount equal to the Loan proceeds previously advanced by the Banks in respect of such Eligible Asset. 

        (c)    Any
Borrowings must be repaid in full, together with any interest owing with respect to such Borrowings, on a date which is not later than ninety (90) days from
the date of such Borrowing. 

        (d)    Any
and all principal amounts paid with respect to any Eligible Asset shall, within    (    ) Business Days of the Borrower's, the Custodian's or
the Bank's (as that term is defined in the Custodial Agreement) receipt thereof, be delivered to the Administrative Agent for the benefit of each of the Banks for application  pro rata in reduction of
the outstanding principal amount of the Loans. 

        (e)    With
respect to each prepayment of Loans required by this Section 4.02, the Borrower may designate the Types of Loans which are to be prepaid and, in the case of
Eurodollar Rate Loans, the specific Borrowing or Borrowings pursuant to which such Eurodollar Rate Loans were made, provided that: (i) each
prepayment of Eurodollar Rate Loans made pursuant to this Section 4.02 which occurs on a date which is not the last day of the Interest Period applicable thereto shall be subject to the
provisions of Section 2.12; (ii) if any prepayment of Eurodollar Rate Loans made pursuant to a single Borrowing shall reduce the outstanding Loans made pursuant to such Borrowing to an
amount less than [$                        ], such outstanding Loans shall immediately be converted into Base Rate Loans; and
(iii) each prepayment of any Loans made pursuant to
a Borrowing shall be applied pro rata among such Loans. In the absence of a designation at the time of prepayment by the Borrower as described in 

27

 

the
preceding sentence, the Administrative Agent shall, subject to the above, make such designation in its sole discretion. 

        (f)    Notwithstanding
anything to the contrary contained in this Agreement, all then outstanding Loans shall be repaid in full on the Maturity Date. 

        4.03    Method and Place of Payment.    Except as otherwise specifically provided herein, all payments under this
Agreement or any Note shall be made to the Administrative Agent for the account of the Bank or Banks entitled thereto not later than 10:00 A.M. (New York time) on the date when due and shall be
made in Dollars in immediately available funds at the Payment Office of the Administrative Agent. Whenever any payment to be made hereunder or under any Note shall be stated to be due on a day which
is not a Business Day, the due date thereof shall be extended to the next succeeding Business Day and, with respect to payments of principal, interest shall be payable at the applicable rate during
such extension. 

        4.04    Net Payments.    (a)    All payments made by the Borrower hereunder or under any Note will be made
without setoff, counterclaim or other defense. Except as provided in Section 4.04(b), all such payments will be made free and clear of, and without deduction or withholding for, any present or
future taxes, levies, imposts, duties, fees, assessments or other charges of whatever nature now or hereafter imposed
by any jurisdiction or by any political subdivision or taxing authority thereof or therein with respect to such payments (but excluding, except as provided in the second succeeding sentence, any tax
imposed on or measured by the net income or net profits of a Bank pursuant to the laws of the jurisdiction in which it is organized or the jurisdiction in which the principal office or Applicable
Lending Office of such Bank is located or any subdivision thereof or therein) and all interest, penalties or similar liabilities with respect to such non-excluded taxes, levies, imposts,
duties, fees, assessments or other charges (all such non-excluded taxes, levies, imposts, duties, fees, assessments or other charges being referred to collectively as
"Taxes"). If any Taxes are so levied or imposed, the Borrower agrees to pay the full amount of such Taxes, and such additional amounts as may be
necessary so that every payment of all amounts due under this Agreement or under any Note, after withholding or deduction for or on account of any Taxes, will not be less than the amount provided for
herein or in such Note. If any amounts are payable in respect of Taxes pursuant to the preceding sentence, the Borrower agrees to reimburse each Bank, upon the written request of such Bank, for taxes
imposed on or measured by the net income or net profits of such Bank pursuant to the laws of the jurisdiction in which such Bank is organized or in which the principal office or Applicable Lending
Office of such Bank is located or under the laws of any political subdivision or taxing authority of any such jurisdiction in which such Bank is organized or in which the principal office or
applicable lending office of such Bank is located and for any withholding of taxes as such Bank shall determine are payable by, or withheld from, such Bank, in respect of such amounts so paid to or on
behalf of such Bank pursuant to the preceding sentence and in respect of any amounts paid to or on behalf of such Bank pursuant to this sentence. The Borrower will furnish to the Administrative Agent
within forty-five (45) days after the date the payment of any Taxes is due pursuant to applicable law certified copies of tax receipts evidencing such payment by the Borrower. The
Borrower agrees to indemnify and hold harmless each Bank, and reimburse such Bank upon its written request, for the amount of any Taxes so levied or imposed and paid by such Bank. 

        (b)    Each
Bank that is not a United States person (as such term is defined in Section 7701(a)(30) of the Code) for United States federal income tax purposes agrees to
deliver to the Borrower and the Administrative Agent on or prior to the Effective Date, or in the case of a Bank that is an assignee or transferee of an interest under this Agreement pursuant to
Section 12.04(c) (unless the respective Bank was already a Bank hereunder immediately prior to such assignment or transfer), on the date of such assignment or transfer to such Bank,
(i) two accurate and complete original signed copies of Internal Revenue Service Form W-8ECI or Form W-8BEN (with respect to a complete exemption under an
income tax treaty) (or successor forms) certifying to such Bank's entitlement as of such date to a 

28

 

complete
exemption from United States withholding tax with respect to payments to be made under this Agreement and under any Note, or (ii) if the Bank is not a "bank" within the meaning of
Section 881 (c)(3)(A) of the Code and cannot deliver either Internal Revenue Service Form W-8ECI or Form W-8BEN (with respect to a complete exemption under
an income tax treaty) pursuant to clause (i) above, (x) a certificate substantially in the form of Exhibit D (any such certificate, a
"Section 4.04(b)(ii) Certificate") and (y) two accurate and complete original signed Copies of Internal Revenue Service
Form W-8BEN (with respect to the portfolio exemption) (or successor form) certifying to such Bank's entitlement to a complete exemption from United States withholding tax with
respect to payments of interest to be made under this Agreement and under any Note. In addition, each Bank agrees that from time to time after the Effective Date, when a lapse in time or change in
circumstances renders the previous certification obsolete or inaccurate in any material respect, it will deliver to the Borrower and the Administrative Agent two new accurate and complete original
signed copies of Internal Revenue Service Form W-8ECI, Form W-8BEN (with respect to the benefits of any income tax treaty), Form W-8BEN (with
respect to the portfolio interest exemption) and a Section 4.04(b)(ii) Certificate, as the case may be, and such other forms as may be required in order to confirm or establish the
entitlement of such Bank to a continued exemption from or reduction in United States withholding tax with respect to payments under this Agreement and any Note, or it shall immediately notify the
Borrower and the Administrative Agent of its inability to deliver any such Form or Certificate, in which case such Bank shall not be required to deliver any such Form Certificate pursuant to this
Section 4.04(b). Notwithstanding anything to the contrary contained in Section 4.04(a), but subject to Section 12.04(c) and the immediately succeeding sentence, (x) the
Borrower shall be entitled, to the extent it is required to do so by law, to deduct or withhold income or similar taxes imposed by the United States (or any political subdivision or taxing authority
thereof or therein) from interest, Fees or other amounts payable hereunder for the account of any Bank which is not a United States person (as such term is defined in Section 7701(a)(30) of the
Code) for United States federal income tax purposes to the extent that such Bank has not provided to the Borrower United States Internal Revenue Service Forms that establish a complete exemption from
such deduction or withholding and (y) the Borrower shall not be obligated pursuant to Section 4.04(a) hereof to gross-up payments to be made to a Bank in respect of income or
similar taxes imposed by the United States if (I) such Bank has not provided to the Borrower the Internal Revenue Service Forms required to be provided to the Borrower pursuant to this
Section 4.04(b) or (II) in the case of a payment, other than interest, to a Bank described in clause (ii) above, to the extent that such Forms do not establish a complete
exemption from withholding of such taxes. Notwithstanding anything to the contrary contained in the preceding sentence or elsewhere in this Section 4.04 and except as set forth in
Section 12.04(c), the Borrower agrees to pay any additional amounts and to indemnify each Bank in the manner set forth in Section 4.04(a) (without regard to the identity of the
jurisdiction requiring the deduction or withholding) in respect of any Taxes deducted or withheld by it as described in the immediately preceding sentence as a result of any changes that are effective
after the Effective Date in any applicable law, treaty, governmental rule, regulation, guideline or order, or in the interpretation
thereof, relating to the deducting or withholding of such Taxes. 

        4.05    Extension of Maturity Date.    Provided no Event of Default or Incipient Default has occurred that is
continuing, the Borrower shall have the option to extend the Maturity Date for one (1) period of twelve (12) months (the "Extension
Period"); provided that, with respect to the Extension Period, (i) the Borrower delivers to the Administrative Agent a
written request for such extension (an "Extension Notice") not more than one hundred twenty (120) days and not less than ninety (90) days
prior to the then Maturity Date; (ii) the Administrative Agent receives payment of the Extension Fee; (iii) Borrower shall deliver to the Administrative Agent a certification from an
authorized officer of the Borrower stating that as of the date that the Extension Notice no Event of Default or Incipient Default has occurred and is continuing; (iv) Borrower shall deliver to
the Administrative Agent a certification from an authorized officer of the Borrower stating that as of the date that the Extension Period 

29

 

commences
(a) no Event of Default or Incipient Default has occurred and is continuing and (b) all of the representations and warranties of the Borrower as set forth in Section 7
of this Agreement are true and correct; and (v) the Parent shall, as of the date of the Extension Notice, be a publicly traded company listed, quoted or traded on the New York Stock Exchange,
NASDAQ or any such other nationally recognized stock exchange and the Parent shall covenant in writing to the Administrative Agent that it shall continue to be a publicly traded company listed, quoted
or traded on the New York Stock Exchange, NASDAQ or any such other nationally recognized stock exchange during the entire term of the Extension Period. 

 
 

SECTION 5
  
    SECURITY    
    

        5.01    Liens and Security Interests.    To secure performance by the Borrower of the payment of each Note and the
other Obligations: 

        (a)    The
Parent shall grant, pledge and assign to the Administrative Agent, for the benefit of each of the Banks, a perfected security interest and lien (subject only to any
security interest and lien granted to the Seller under, and as that term is defined in, the Acquisition Repurchase Agreement) in and to all of the Parent's Equity Interests into any Subsidiary of
Parent (including, without limitation, any Newly Formed Subsidiary as and when formed), whether now existing or hereafter formed, any such grant, pledge and assignment to be in the form of the Pledge
Agreement attached hereto as Exhibit F. 

        (b)    Any
Newly Formed Subsidiary formed in connection with the acquisition of an Eligible Asset in accordance with, and subject to, all of the terms and conditions set forth
in the Acquisition Repurchase Agreement (including, without limitation, Sections    ,    , and    thereof) shall, at the time of the acquisition of such Eligible
Asset, grant, pledge and assign to the Administrative Agent, for the benefit of each of the Banks, (i) an exclusive, perfected and prior security interest in and to all of such Newly Formed
Subsidiary's right, title and interest in and to such Eligible Asset, any such grant, pledge and assignment to be in the form of the Security Agreement attached hereto as Exhibit I, and
(ii) an exclusive, perfected and prior security interest in and to all of such Newly Formed Subsidiary's right, title and interest in and to the Collection Account established with respect to
the Eligible Asset, any such grant, pledge and assignment to be in the form of the Account Control Agreement attached hereto as Exhibit J. 

        (c)    Any
Newly Formed Subsidiary formed in connection with the acquisition of an Eligible Asset in accordance with, and subject to, all of the terms and conditions set forth
in the Acquisition Repurchase Agreement (including, without limitation, Sections    ,    , and    thereof) shall, at the time of the acquisition of such Eligible
Asset deliver to the Administrative Agent or its designee (including the Custodian) the documents identified in the Custodial Agreement. 

        (d)    Any
Mortgage Asset Files (as that term is defined in the Acquisition Repurchase Agreement) not delivered to the Administrative Agent or its designee (including the
Custodian) are and shall be held in trust by the applicable Newly Formed Subsidiary or its designee for the benefit of the Administrative Agent as the beneficiary of an exclusive, perfected and prior
security interest in and to all of such Newly Formed Subsidiary's right, title and interest in and to such Eligible Asset pursuant to the related Security Agreement. The applicable Newly Formed
Subsidiary or its designee shall maintain a copy of the Mortgage Asset File and the originals of the Mortgage Asset File not delivered to the Administrative Agent or its designee (including the
Custodian). The possession of the Mortgage Asset File by the applicable Newly Formed Subsidiary or its designee is at the will of the Administrative Agent for the sole purpose of servicing the related
Eligible Asset, and such retention and possession by such Newly Formed Subsidiary or its designee is in a custodial capacity only. Each Mortgage Asset File 

30

 

retained
or held by the applicable Newly Formed Subsidiary or its designee shall be segregated on such Newly Formed Subsidiary's books and records, to the extent possible, from the other assets of
such Newly Formed Subsidiary or its designee and the books and records of such Newly Formed Subsidiary or its designee shall be marked appropriately to reflect clearly the sale of the related Eligible
Asset to the Administrative Agent. The applicable Newly Formed Subsidiary or its designee shall release its custody of the Mortgage Asset File only in accordance with written instructions from the
Administrative Agent, unless such release is required as incidental to the servicing of the Eligible Assets. 

        (e)    The Parent and each of its Subsidiaries which is a party to any Derivatives Contract shall grant, pledge and assign to the Administrative Agent, for the benefit of each
of the Banks, all of its right, title

and interest in and to any such Derivatives Contract, such grant, pledge and assignment to be in form and content acceptable to the Administrative Agent in its sole and absolute discretion.

        5.02    Agreement to Deliver Additional Collateral Documents.    The Borrower shall deliver such security agreements,
financing statements, assignments and other collateral documents (all of which shall be deemed part of the "Collateral Documents"), in form and
substance reasonably satisfactory to the Administrative Agent, as the Administrative Agent, acting on behalf of the Banks, may reasonably request from time to time for the purpose of granting to, or
maintaining or perfecting in favor of, the Banks, first and exclusive security interests in the Collateral, together with other assurances which the Borrower is in a position to deliver as to the
enforceability and priority of the Banks' liens and assurances of due recording and documentation of copy of the Collateral Documents, as the Administrative Agent may reasonably require to avoid
material impairment of the liens and security interests granted or purported to be granted pursuant to this Section 5. 

        5.03    Collection Account.    Subject to the conditions set forth below, the Borrowers shall be entitled to receive
an amount equal to all Income (as that term is defined in the Acquisition Repurchase Agreement) paid or distributed on or in respect of the Eligible Assets assigned to the Administrative Agent
pursuant to this Agreement that is not otherwise received by any Borrower, to the full extent it would be so entitled if a security interest in the Eligible Assets had not been granted in favor of the
Administrative Agent. Notwithstanding the foregoing, each Borrower hereby agrees to instruct each applicable trustee, servicer or other party acting as paying agent with respect to the related
Eligible Asset, to transfer all Income with respect to the Eligible Asset directly to the Administrative Agent for deposit into the Collection Account within two (2) Business Days after receipt
thereof. On each Payment Date, any amounts on deposit in the Collection Account in respect of an Eligible Asset shall be applied as follows: first, to
the payment of all fees, expenses, and other obligations then due to the Administrative Agent and/or the Banks and/or their respective Affiliates pursuant to this Agreement, and  second, to the Operating
Account (as that term is defined in the Acquisition Repurchase Agreement, for such purposes as the applicable Seller shall
determine in its sole discretion. All investment income received with respect to the amount in the Collection Account shall be held by the Administrative Agent for the account of Borrowers, subject to
Administrative Agent's liens on such amounts created under this Agreement and the other Loan Documents, and shall be paid to the Operating Account in the priority stated above, provided all amounts
due and payable to the Administrative Agent, the Banks or their respective Affiliates under the terms of the this Agreement and the other Loan Documents have been timely paid. 

        5.04    Payment of Costs and Expenses.    The Borrower shall, whether or not the transactions herein contemplated are
consummated, pay, within ten (10) days after demand from the Administrative Agent, all reasonable out-of-pocket costs and expenses (including, without limitation,
reasonable fees and disbursements of outside legal counsel, accounting, consulting, brokerage or other similar professional fees or expenses, and any reasonable fees and expenses associated with
travel or other costs relating to any appraisals or examinations conducted in connection with the Loans or the Collateral, and the amount of such costs and expenses shall, until paid, bear interest at
the rate applicable to Base Rate 

31

 

Loans
(or the Default Rate, if applicable) and shall be an obligation secured by the Collateral) (x) of the Administrative Agent (including, without limitation, the reasonable fees and
disbursements of Cadwalader, Wickersham & Taft LLP) in connection with the preparation, execution and delivery of this Agreement and the other Loan Documents (other than any Assignment and
Acceptance Agreements) and the documents and instruments referred to herein and therein and the syndication of the Commitments and (y) of the Administrative Agent and each of the Banks in
connection with the enforcement of this Agreement and the other Loan Documents (other than any Assignment and Acceptance Agreements) and any amendment, waiver or consent (other than an amendment,
waiver or consent not requested by the Borrower in respect of an Assignment and Acceptance Agreement) relating hereto or thereto and the documents and instruments referred to herein and therein
(including, without limitation, the reasonable fees and disbursements of not more than one counsel for the Administrative Agent and the Banks collectively). 

 
 

SECTION 6
  
    CONDITIONS PRECEDENT    
    

        The obligation of each Bank to make any Loan is subject, at the time of each Loan Event (except as hereinafter indicated), to the satisfaction of the following
conditions: 

        6.01    No Default; Representations and Warranties.    On the Effective Date and at the time of each Loan Event and
also immediately after giving effect thereto (i) there shall exist no Event of Default or Incipient Default, (ii) all representations and warranties contained herein and in the other
Loan Documents executed by the Borrower shall be true and correct in all material respects with the same effect as though such representations and warranties had been made on and as of such date,
except to the extent such representations and warranties relate to an earlier date, in which case such representations and warranties shall be true and correct in all material respects as of such
earlier date, and (iii) there shall be outstanding no uncured Margin Deficit (under, and as such term is defined in, the Master Repurchase Agreement and/or the Acquisition Repurchase Agreement,
as applicable). 

        6.02    Execution of Agreement; Notes.    There shall have been delivered to the Administrative Agent for the account
of each of the Banks, fully executed counterparts of this Agreement, the appropriate Note
executed by the Borrower in the amount, maturity and as otherwise provided herein and all other Loan Documents. 

        6.03    Notice of Borrowing.    Prior to each Loan Event (other than in respect of any Conversions) the Administrative
Agent shall have received a Notice of Borrowing accompanied by a Borrowing Certificate. 

        6.04    Opinions of Counsel.    The Administrative Agent shall have received opinions of Borrower's counsel with
respect to due execution, authority, enforceability of the Loan Documents and such other matters as the Administrative Agent may reasonably require, all such opinions to be in form, scope and
substance satisfactory to the Administrative Agent and its counsel in their sole discretion. 

        6.05    Borrower's Closing Certificate.    There shall have been delivered to Administrative Agent a certificate dated
the Effective Date and signed by a Responsible Officer of the Parent, stating that (i) all of the representations and warranties of the Borrower contained in Section 7 hereof and in the
other Loan Documents executed by the Borrower are true and correct as of such date, except to the extent such representations and warranties relate to an earlier date, in which case such
representations and warranties are true and correct as of such earlier date; and (ii) no Event of Default or Incipient Default has occurred and is continuing, or would result from the making of
Loans. 

        6.06    Governing Documents.    On or before the Effective Date, Borrower shall deliver or cause to be delivered to
the Administrative Agent (a) copies certified by Borrower of all organizational documentation related to each Borrower and each Newly Formed Subsidiary (if any) which must be 

32

 

acceptable
to the Administrative Agent in its sole discretion, and (b) such other evidence of the formation, structure, existence, good standing and/or qualification to do business of each
Borrower and each Newly Formed Subsidiary (if any), as the Administrative Agent may request in its sole discretion, including, without limitation, good standing or existence certificates,
qualifications to do business in the appropriate jurisdictions, resolutions authorizing the entering into of the Loan and incumbency certificates as may be requested by the Administrative Agent. 

        6.07    Incumbency Certificate.    On or before the Effective Date, Borrower shall deliver to the Administrative Agent
a signed certificate by a Responsible Officer of the Parent which shall certify the names of the officers authorized to sign each Loan Document and the other documents or certificates to be delivered
pursuant thereto (including the Notices of Borrowing and the Notices of Conversion) together with the true signatures of each such officer. The Administrative Agent may conclusively rely on such
certificate until it shall receive a further certificate canceling or amending the prior certificate and submitting the signatures of the officers named in such further certificate. 

        6.08    Collateral Documents.    The Collateral Documents required to be delivered under Sections 5.01 and 5.02
hereof, duly executed by the appropriate Persons, together with evidence that (to the extent necessary) the Collateral Documents have been duly filed, evidenced and documented, that all recording
taxes and fees have been paid and that all other actions have been taken in the manner necessary to establish, protect, preserve and perfect, as a valid lien or security interest the liens granted to
the Banks thereunder, subject to no other security interest, including, without limitation, the filing of financing statements in form and substance satisfactory to the Administrative Agent. 

        6.09    Borrowing Certificate.    A Borrowing Certificate dated as of the Effective Date. 

        6.10    Adverse Change, Etc.    (a)    On the date of each Loan Event nothing shall have occurred (and the
Banks shall have become aware of no facts or conditions not previously known) which is a Material Adverse Event. 

        (b)    On
the date of each Loan Event there shall be no actions, suits, investigations or proceedings pending or threatened by any entity (private or governmental) with respect
to any Loan Document or any documentation executed in connection therewith or the transactions contemplated hereby which is a Material Adverse Event. 

        6.11    Borrowings.    In connection with any Borrowing, except to the extent otherwise specifically provided for
below, the Borrower shall be required to grant, pledge, and assign to the Administrative Agent, for the benefit of the Banks, all of its right, title, and interest in and to an Eligible Asset, the
Associated Value of which must be equal to or greater than 200% of the amount of the proposed Borrowing and the following shall have occurred: 

        (a)    Delivery of Materials.    The Borrower shall have delivered to the Administrative Agent such materials,
documentation, records and data with respect to such Eligible Asset as may be requested by the Administrative Agent in its sole and absolute discretion. The undertaking by the Administrative Agent of
its Due Diligence Review with respect to any proposed Eligible Asset to be pledged to the Administrative Agent for the benefit of the Banks, as provided for herein, shall be conducted by the
Administrative Agent at no material cost to the Borrower unless the Administrative Agent shall have determined that the proposed Eligible Asset is an [esoteric] instrument or
otherwise contains [nonconventional] features for which the Administrative Agent reasonably believes that a [legal review] is appropriate; 

        (b)    Formation of Newly Formed Subsidiary.    The Parent shall have established a Newly Formed Subsidiary to take
and hold title to the Eligible Asset, such Newly Formed Subsidiary to be, if required by the Administrative Agent, a Special Purpose Entity and to be otherwise acceptable to the Administrative Agent
in all respects and such Newly Formed Subsidiary shall have executed and delivered to the Administrative Agent a Joinder Agreement; 

33

 

        (c)    Delivery of Collateral Documents.    The Parent shall have delivered to the Administrative Agent a fully
executed Pledge Agreement, Security Agreement and/or Account Control Agreement with respect to the Eligible Asset; 

        (d)    Approval of Eligible Asset.    The Administrative Agent shall have approved, which approval may be withheld in
the sole and absolute discretion of the Administrative Agent, the proposed Eligible Asset with respect to, among other things, the Associated Value thereof (which must be an amount equal to at least
200% of the amount of the Borrowing being requested) and conformity with the Eligible Asset criteria set forth in the Acquisition Repurchase Agreement; 

        (e)    Delivery of Documentation and Legal Opinions.    The Borrower shall have delivered to the Administrative Agent
such documentation and opinions of counsel as are required pursuant to the Borrowing Checklist attached hereto as Exhibit K; and 

        (f)    Delivery of Custodial Agreement. 

To
the extent that the Administrative Agent and the Banks have agreed to fund a Borrowing requested by the Borrower, the Administrative Agent and the Banks shall use commercially reasonable efforts to
fund such Borrowing within one (1) Business Day (or as soon thereafter as reasonable) from the date on which such Borrowing has been approved. 

Notwithstanding the foregoing or anything else in this Agreement to the contrary, in the event that the Administrative Agent shall have determined in its sole and absolute discretion that
(i) the ratio of the Parent's Total Liabilities Ratio is less than seventy-five percent (75%), and (ii) the Debt Service Coverage Ratio (as determined in accordance with, and
as that term is defined in, the Acquisition Repurchase Agreement) with respect to the proposed Eligible Asset is equal to or greater than 1.75x, then the Borrower shall not be required to grant,
pledge or assign any Eligible Asset to the Administrative Agent as Collateral for the proposed Borrowing.

        6.12    Fees, Etc.    On the Effective Date, all Fees, costs and expenses (including, without limitation, legal fees
and expenses) and other compensation payable to the Administrative Agent and/or the Banks shall have been paid to the extent due. 

        6.13    Consummation of Transaction.    On the Effective Date, all terms of the documentation for and all payments
made in connection with or as a result of, the formation of the Borrower and the transactions contemplated by the Borrower's Governing Documents in effect on the Effective Date shall be satisfactory
to the Banks. 

        The
acceptance of the benefits of each Loan Event shall constitute a representation and warranty by the Borrower to the Administrative Agent and each of the Banks that all the conditions
specified in this Section 6 exist as of that time. All the Notes, certificates, legal opinions and other documents and papers referred to in this Section 6, unless otherwise specified,
shall be delivered to the Administrative Agent at the Administrative Agent's Notice Office for the account of each of the Banks and, except for the Notes, in sufficient counterparts for each of the
Banks and shall be satisfactory in form and substance to the Administrative Agent. 

 
 

SECTION 7
  
    REPRESENTATIONS, WARRANTIES AND AGREEMENTS    
    

        In order to induce the Banks to enter into this Agreement and to make the Loans, the Borrower (and, where indicated, the Parent) makes the following
representations, warranties and agreements, 

34

 

which
shall survive the execution and delivery of this Agreement and the Notes and the making of the Loans: 

        7.01    Organization and Good Standing.    Each Loan Party (i) is a duly organized and validly existing
corporation, partnership or limited liability company, as the case may be, in good standing under the laws of the jurisdiction of its organization, (ii) has the requisite corporate, partnership
or limited liability company power and authority, as the case may be, to own its property and assets and to transact the business in which it is engaged and presently proposes to engage and
(iii) is duly qualified and is authorized to do business and is in good standing in each jurisdiction where the ownership, leasing or operation of its property or the conduct of its business
requires such qualifications. 

35

  

        7.02    Authorization and Power.    Each Loan Party has the requisite power and authority to execute, deliver, and
perform under this Agreement and the other Loan Documents executed by it; each Loan Party is duly authorized to, and has taken all action necessary to authorize such Loan Party to, execute, deliver,
and perform under this Agreement and such other Loan Documents and is and will continue to be duly authorized to perform under this Agreement and such other Loan Documents. 

        7.03    No Conflicts or Consents.    Neither the execution and delivery of this Agreement and the other Loan Documents
by any Loan Party, nor the consummation of any of the transactions by it herein or therein contemplated, nor compliance with the terms and provisions hereof or with the terms and provisions thereof,
will contravene or conflict with any provision of law, statute, or regulation to which such Loan Party is subject or any material judgment, license, order, or permit applicable to such Loan Party or
contravene or conflict with or result in the creation or imposition of (or the obligation to create or impose) any Lien upon any of the property or assets of such Loan Party pursuant to the terms of
any indenture, mortgage, deed of trust, or other agreement or instrument to which such Loan Party is a party or by which such Loan Party may be bound, or to which such Loan Party may be subject, other
than Liens created pursuant to the Collateral Documents. No consent, approval, authorization, or order of any court or Governmental Authority or third party is required in connection with the
execution and delivery by any Loan Party of the Loan Documents to which the Loan Parties are a party or to consummate the transactions contemplated hereby or thereby which has not already been
obtained. 

        7.04    Enforceable Obligations.    This Agreement and the other Loan Documents to which the Loan Parties are party
are, or when executed and delivered will be, the legal and binding obligations of such Loan Parties, enforceable in accordance with their respective terms. 

        7.05    Agreements.    No Loan Party is a party to any agreement or instrument or subject to any restriction which
could reasonably be expected to result in a Material Adverse Event. Borrower is not in default in any material respect in the performance, observance or fulfillment of any of the obligations,
covenants or conditions contained in any agreement or instrument to which it is a party or by which Borrower is bound. Borrower has no material financial obligation under any agreement or instrument
to which Borrower is a party or by which Borrower is otherwise bound, other than (a) obligations incurred in the ordinary course of the Borrower's business and (b) obligations under the
Loan Documents. 

        7.06    Solvency.    (a)    No Borrower has entered into the transaction or executed the Note, this
Agreement or any other Loan Documents with the actual intent to hinder, delay or defraud any creditor and (b) each Borrower has received reasonably equivalent value in exchange for its
obligations under such Loan Documents. Giving effect to the Loan, the fair saleable value of the assets of Borrower exceeds and will, immediately following the making of the Loan, exceed the total
liabilities of Borrower, including, without limitation, subordinated, unliquidated, disputed and contingent liabilities. No petition in
bankruptcy has been filed against Borrower in the last ten (10) years, and Borrower has not in the last ten (10) years made an assignment for the benefit of creditors or taken advantage
of any Debtor Relief Laws. No Borrower is contemplating either the filing of a petition by it under any Debtor Relief Laws or the liquidation of all or a major portion of Borrower's assets or
property, and Borrower has no knowledge of any Person contemplating the filing of any such petition against Borrower. 

        7.07    Governmental Approvals.    No order, consent, approval, license, authorization or validation of, or filing,
recording or registration with, or exemption by, any Governmental Authority is required to authorize, or is required in connection with, (i) the execution, delivery and performance of any Loan
Document to which any Loan Party is or will be a party, (ii) the legality, validity, binding effect or enforceability of any such Loan Document against the Loan Parties or (iii) the
consummation of the 

36

 

transactions
contemplated by this Agreement (other than the filing of certain financing statements in respect of certain Collateral Documents). 

        7.08    Financial Condition.    As of the Effective Date, the Borrower has delivered to the Administrative Agent
copies of their respective most recent quarterly balance sheets and the related statements of income and cash flows, certified by a Responsible Officer of the Parent to be true and correct; such
financial statements are true and correct, fairly present the respective financial condition of the Borrower as of such date and have been prepared in accordance with Tax Based Accounting Principles. 

        7.09    Full Disclosure.    As of the Effective Date, there is no material fact known to the Borrower that has not
been disclosed to the Banks in writing which constitutes a Material Adverse Event. Neither the financial statements referred to in Section 7.08 hereof, nor any certificate or statement
delivered herewith or heretofore by the Borrower to the Banks or any of them in connection with negotiations of this Agreement, contains any untrue statement of a material fact or omits to state any
material fact that constitutes a Material Adverse Event. 

        7.10    No Default.    No event has occurred and is continuing which constitutes an Event of Default or Incipient
Default. 

        7.11    Material Adverse Event.    No changes to any Borrower have occurred which constitute a Material Adverse Event
since the most recent financial statement delivered to the Administrative Agent. 

        7.12    No Litigation.    As of the Effective Date, there are no material actions, suits or legal, equitable,
arbitration or administrative proceedings pending, or to the knowledge of the Borrower threatened, against the Borrower as to which there is a reasonable possibility of an adverse determination that
would constitute a Material Adverse Event. To the extent the representations and warranties in this
Section 7 shall be remade as of any date subsequent to the date hereof, the Borrower shall be deemed to represent that as of such subsequent date, there are no actions, suits or legal,
equitable, arbitration or administrative proceedings pending, or to the knowledge of the Borrower, threatened, against the Borrower which have not been disclosed to the Banks in writing and as to
which there is a reasonable possibility of an adverse determination that would constitute a Material Adverse Event. 

        7.13    Taxes.    Each Borrower has filed all required federal income tax returns and all other material tax returns,
domestic and foreign, required to be filed by it and has paid all material taxes (including mortgage recording taxes), assessments, fees, and other governmental charges payable by it, or with respect
to any of their properties, which have become due, and income or franchises have been paid prior to the time that such taxes could give rise to a lien thereon or are being contested in good faith by
appropriate proceedings and appropriate reserves therefor have been established in accordance with GAAP. Each Borrower has paid, or has provided adequate reserves (in the good faith judgment of the
management of the Borrower) for the payment of, all federal, state and foreign income taxes applicable for all prior fiscal years and for the current fiscal year to date. There is no material action,
suit, proceeding, investigation, audit or claim now pending or, to the knowledge of the Borrower, threatened by any authority regarding any taxes relating to the Borrower which is material or not
being contested in good faith. The Borrower has not entered into an agreement or waiver or been requested to enter into an agreement or waiver extending any statute of limitations relating to the
payment or collection of taxes, or is aware of any circumstances that would cause the taxable years or other taxable periods of the Borrower not to be subject to the normally applicable statute of
limitations. 

        7.14    No Plan Assets.    Borrower is not an "employee benefit plan," as defined in Section 3(3) of ERISA,
subject to Title I of ERISA, and none of the assets of Borrower constitutes or will constitute "plan assets" of one or more such plans within the meaning of 29 C.F.R.
Section 2510.3-101. In 

37

 

addition,
(a) Borrower is not a "governmental plan" within the meaning of Section 3(32) of ERISA and (b) transactions by or with Borrower are not subject to state statutes
regulating investment of, and fiduciary obligations with respect to, governmental plans similar to the provisions of Section 406 of ERISA or Section 4975 of the Internal Revenue Code
currently in effect, which prohibit or otherwise restrict the transactions contemplated by this Agreement. 

        7.15    Compliance with Law.    The Borrower is in compliance with all laws, rules, regulations, orders and decrees
(including, without limitation, those relating to environmental standards and controls) which are applicable to the Borrower or its respective properties and as to which the Borrower's failure to
comply with constitutes a Material Adverse Event. 

        7.16    Government Regulation.    Borrower is not (a) an "investment company" or a company "controlled" by an
"investment company," within the meaning of the Investment Company Act of 1940, as amended; (b) a "holding company" or a "subsidiary company" of a "holding company" or an "affiliate" of either
a "holding company" or a "subsidiary company" within the meaning of the Public Utility Holding
Company Act of 1935, as amended; or (c) subject to any other federal or state law or regulation which purports to restrict or regulate its ability to borrow money. 

        7.17    Insider.    The Borrower is not an "executive officer," "director," or "person who directly or indirectly or
acting through or in concert with one or more persons owns, controls, or has the power to vote more than 10% of any class of voting securities" (as those terms are defined in 12 U.S.C.
§375(b) or in regulations promulgated pursuant thereto) of any Bank, of a bank holding company of which any Bank is a subsidiary, or of any subsidiary, of a bank holding company of which
any Bank is a subsidiary, of any bank at which any Bank maintains a correspondent account or of any lender which maintains a correspondent account with any Bank. 

        7.18    Fiscal Year.    The fiscal year of the Borrower is the calendar year. 

        7.19    Use of Proceeds; Margin Regulations.    All proceeds of each Loan shall be used by the Borrower for purposes
permitted under the Borrower's Governing Documents, provided that no part of the proceeds of any Loan will be used by the Borrower to purchase or carry
any Margin Stock or to extend credit to others for the purpose of purchasing or carrying any Margin Stock. Neither the making of any Loan, the use of the proceeds thereof will violate or be
inconsistent with the provisions of Regulations T, U or X of the Board of Governors of the Federal Reserve System. 

        7.20    The Collateral Documents.    The provisions of each Pledge Agreement will be effective to create in favor of
the Administrative Agent, for the benefit of each of the Banks legal, valid and enforceable security interests in all right, title and interest of the Loan Parties in the Collateral described therein
to the extent that a security interest can be created therein under the UCC, and the Administrative Agent, for the benefit of each of the Banks, has fully perfected liens on, and security interests
in, all right, title and interest of the Loan Parties in all of the Collateral described therein (to the extent such security interest can be perfected by filing a UCC-1 financing
statement or, to the extent required by the Pledge Agreement, Security Agreement and Account Control Agreement by taking possession of or controlling the respective collateral), subject to no other
Liens, except to the extent granted by the Seller to the Buyer under, and as those terms are defined in, the Acquisition Repurchase Agreement. 

        7.21    Brokerage Fees.    The Borrower and [            ] (and their respective
affiliates) each represent and warrant to the other that (i) there is no brokerage commission payable in connection with the credit facility described in this Agreement and (ii) they
have not engaged the services of a broker in connection with the credit facility described in this Agreement. 

        7.22    Principal Place of Business; Location of Records; Federal Tax ID.    The principal places of business of the
Borrower are located at c/o [                        ],
[                        ],
[                        ],
[                        ].
All of the books and records of the Borrower are and will be kept at c/o [ 

38

 

                        ],
[                        ],
[                        ],
[                        ] and will continue to be at such location
(unless the Borrower notifies the Administrative Agent in writing at least thirty (30) days prior to the date of such change). The Borrower's federal taxpayer's identification number is
[                        ]. 

        7.23    Office of Foreign Assets Control.    The Borrower is not a person (i) whose property or interest in
property is blocked or subject to blocking pursuant to Section 1 of Executive Order 13224 of September 23, 2001 Blocking Property and Prohibiting Transactions With Persons Who Commit,
Threaten to Commit, or Support Terrorism (66 Fed. Reg. 49079 (2001)), (ii) who engages in any dealings or transactions prohibited by Section 2 of such executive order, or to the best of
Borrower's knowledge, is otherwise associated with any such person in any manner violative of Section 2, or (iii) on the current list of Specially Designated Nationals and Blocked
Persons or subject to the limitations or prohibitions under any other U.S. Department of Treasury's Office of Foreign Assets Control regulation or executive order. 

        7.24    Patriot Act.    The Borrower is in compliance, in all material respects, with (i) the Trading with the
Enemy Act, as amended, and each of the foreign assets control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) and any other applicable enabling
legislation or executive order relating thereto, and (ii) the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA Patriot Act of
2001). No part of the proceeds of the Loan will be used, directly or indirectly, for any payments to any governmental official or employee, political party, official of a political party, candidate
for political office, or anyone else acting in an official capacity, in order to obtain, retain or direct business or obtain any improper advantage, in violation of the United States Foreign Corrupt
Practices Act of 1977, as amended. 

        7.25    Certain Tax Matters.    The Borrower represents and warrants, and acknowledges and agrees, that it does not
intend to treat the Loan and the related transactions hereunder as being a "reportable transaction" (within the meaning of United States Treasury Department Regulation
Section 1.6011-4). In the event the Borrower determines to take any action inconsistent with such intention, it will promptly notify the Administrative Agent and the Banks. If the
Borrower so notifies the Administrative Agent and the Banks, the Borrower acknowledges and agrees that the Administrative Agent and the Banks may treat the Loan as part of a transaction that is
subject to United States Treasury Department Regulation Section 301.6112-1, and the Administrative Agent and the Banks will maintain the lists and other records required by such
Treasury Regulation. 

        7.26    REIT Status.    The Parent has not engaged in any material "prohibited transactions" as defined in
Section 857(b)(6)(B)(iii) and (C) of the Code. The Parent for its current "tax year" (as defined in the Code) is and for all prior tax years subsequent to its election to be a
real estate investment trust has been entitled to a dividends paid deduction under the requirements of Section 857 of the Code with respect to any dividends paid by it with respect to each such
year for which it claims a deduction in its Form 1120-REIT filed with the United States Internal Revenue Service for such year. 

 
 

SECTION 8
  
    AFFIRMATIVE COVENANTS    
    

        The Borrower covenants and agrees that on and after the Effective Date and until the Total Commitment has terminated and the Loans and the Notes, together with
interest, Fees and all other 

39

 

Obligations
incurred hereunder and thereunder and under the other Loan Documents to which the Borrower is a party, are paid and performed in full: 

        8.01    Financial Statements, Reports and Documents.    The Borrower shall deliver to the Administrative Agent
sufficient copies for each of the Banks of the following: 

        (a)    Quarterly Financial Statements.    As soon as available and in any event within the earlier to occur of
(i) ten (10) days following the filing of the Parent's Form 10-Q with the Securities and Exchange Commission, and (ii) fifty-five (55) days
after the end of each fiscal quarter of the Parent, the unaudited consolidated balance sheets of each Borrower and their respective Consolidated Subsidiaries as at the end of such period and the
related unaudited consolidated statements of income and retained earnings and of cash flows for each Borrower and their respective Consolidated Subsidiaries for such period and the portion of the
fiscal year through the end of such period, accompanied by a schedule of all contingent funding obligations and hedging positions of each Borrower and their respective Consolidated Subsidiaries and a
certificate of a Responsible Officer of the Parent, which certificate shall state that said consolidated financial statements fairly present in all material respects the consolidated financial
condition and results of operations of each Borrower and their respective Consolidated Subsidiaries in accordance with GAAP, consistently applied, as at the end of, and for, such period (subject to
normal year-end adjustments). 

        (b)    Annual Financial Statements.    As soon as available and in any event within the earlier to occur of
(i) ten (10) days following the filing of the Parent's Form 10-K with the Securities and Exchange Commission, and (ii) one hundred (100) days after the
end of each fiscal year of the Parent, the audited consolidated balance sheets of each Borrower and its respective Consolidated Subsidiaries as at the end of such fiscal year and the related
consolidated statements of income and retained
earnings and of cash flows for each Borrower and their respective Consolidated Subsidiaries for such year, setting forth in each case in comparative form the figures for the previous year, accompanied
by an opinion thereon of independent certified public accountants of recognized national standing, which opinion shall not be qualified as to scope of audit or going concern and shall state that said
consolidated financial statements fairly present the consolidated financial condition and results of operations of each Borrower and their respective Consolidated Subsidiaries as at the end of, and
for, such fiscal year in accordance with GAAP, and a certificate of such accountants stating that, in making the examination necessary for their opinion, they obtained no knowledge, except as
specifically stated, of any Incipient Default or Event of Default. 

        (c)    Tax Returns.    As soon as available, and in any event within thirty (30) days after filing with the
applicable taxing authority, copies of all federal and state income tax returns and all other material tax returns, domestic and foreign, required to be filed by each Borrower and their respective
Consolidated Subsidiaries, in each case with all supporting documentation and such other information as may be reasonably requested by the Administrative Agent. 

        (d)    Borrowing Certificates.    In each instance where a Borrowing is occurring, a Borrowing Certificate will be
delivered, on or prior to the date of the occurrence of such Borrowing by the Borrower to the Administrative Agent. In addition, a Borrowing Certificate shall be delivered as soon as available and, in
any event, not later than fifteen (15) days after the end of each fiscal quarter (including the end of each fiscal year) as well as at any other time as the Administrative Agent shall
reasonably request from time to time; provided that a Borrowing Certificate shall also be delivered by the Borrower to the Administrative Agent in
respect of the final day of each fiscal year and such Borrowing Certificate shall be audited by the Borrower's independent certified accountants and shall be accompanied by the report of such audit
and delivered to the Borrower concurrently with the annual financial statements referred to in Section 8.01(b). 

        (e)    Certificate re Representations and Warranties.    As soon as available and, in any event, not later than thirty
(30) days after the end of each fiscal quarter, the Borrower shall furnish to the 

40

 

Administrative
Agent a document certifying that all of the representations set forth in the Loan Documents remain true and correct as of the date of delivery of such document, except to the extent
that such representations and warranties relate to an earlier date, in which case such representations and warranties were correct as of such earlier date. 

        (f)    Compliance Certificates.    Concurrently with the delivery of each quarterly report referenced in
Section 8.01(a) and at the time of each Loan Event (other than in respect of any Conversions), a certificate of a Responsible Officer of the Parent to the effect that (i) no Event of
Default or Incipient Default has occurred and is continuing, and (ii) the Borrower (or the Parent, as applicable) is in compliance with Section 9.06 hereof (and setting forth in
reasonable detail (and with reasonable supporting documentation) the calculations and other computations evidencing such compliance); provided, that if
any of the events specified in (i) or (ii) above shall not be true, such certificate shall
specify the nature and existence of the circumstances causing such statement to be untrue and the action which the Borrower is taking or proposes to take with respect thereto. 

        (g)    Notice Default or Litigation; Material Adverse Event.    Immediately upon becoming aware thereof, notice of
(i) the occurrence or existence of any condition or event which constitutes an Event of Default or Incipient Default, in which case the notice shall specify the nature and period of existence
thereof and the action which the Borrower is taking or proposes to take with respect thereto and (ii) any litigation or governmental investigation or proceeding pending (x) against any
Borrower or any of its Subsidiaries which constitutes a Material Adverse Event, or (y) with respect to any Indebtedness of the Borrower. Furthermore, the Borrower shall promptly notify the
Administrative Agent in writing upon becoming aware that a Material Adverse Event affecting any Borrower shall have occurred. 

        (h)    Eligible Assets.    With respect to any Eligible Assets acquired with Loan proceeds, such information, reports
and data as would be required to be submitted by the Seller to the Buyer under, and as those terms are defined in, the Acquisition Repurchase Agreement, when and as such information, reports and data
would be required to be delivered by such Seller to such Buyer as provided for in the Acquisition Repurchase Agreement. 

        (i)    ERISA Reporting.    As soon as reasonably possible, and in any event within thirty (30) days after a
Responsible Officer of the Parent knows, or with respect to any Plan to which the Parent or any of its Subsidiaries makes direct contributions, has reason to believe, that any of the events or
conditions specified below with respect to any Plan has occurred or exists, a statement signed by a Responsible Officer of the Parent setting forth details respecting such event or condition and the
action, if any, that the Parent or its ERISA Affiliate proposes to take with respect thereto (and a copy of any report or notice required to be filed with or given to PBGC by the Parent or an ERISA
Affiliate with respect to such event or condition): 

        (i)    any
Reportable Event, or and any request for a waiver under Section 412(d) of the Code or any successor provision thereof for any Plan; 

        (ii)    the
distribution under Section 4041(c) of ERISA or any successor provision thereof of a notice of intent to terminate any Plan or any action taken by the Parent
or an ERISA Affiliate to terminate any Plan; 

        (iii)    the
institution by PBGC of proceedings under Section 4042 of ERISA or any successor provision thereof for the termination of, or the appointment of a trustee to
administer, any Plan; and 

        (iv)    the
adoption of an amendment to any Plan that would result in the loss of tax exempt status of the trust of which such Plan is a part if the Parent or an ERISA
Affiliate fails to provide timely security to such Plan in accordance with the provisions of Section 401(a)(29) of the Code or Section 307 of ERISA or any successor provision thereof. 

41

 

        (j)    Certificates; Other Information. Furnish to the Administrative Agent:

        (i)    concurrently
with the delivery of the financial statements referred to in Section 8.01(b) above, a certificate of the independent certified public accountants
reporting on such financial statements stating that in making the examination necessary therefore no knowledge was obtained of any Incipient Default or Event of Default, except as specified in such
certificate; 

        (ii)    concurrently
with the delivery of the financial statements referred to in Section 8.01(a) above, a certificate of a Responsible Officer of the Parent
substantially in the form of Exhibit L hereto (a) stating that, to the best of such Responsible Officer's knowledge, each Borrower during such period has observed or performed all of its
covenants and other agreements in all material respects, and satisfied every material condition, contained in this Agreement and the related documents to be observed, performed or satisfied by it, and
that such Responsible Officer has obtained no knowledge of any Incipient Default or Event of Default except as specified in such certificate, (b) showing in detail the calculations supporting
such Responsible Officer's certification of Borrower's compliance with the requirements of Section 9.06, (c) setting forth a calculation of the Parent's Funds from Operation for the
preceding fiscal quarter, and (d) showing in detail the calculations projected with respect to the requirements of Section 8.01(j)(iii) for the upcoming period of four
(4) fiscal quarters; 

        (iii)    as
soon as available, but in any event not later than ninety (90) days after the end of each fiscal year of the Parent, a copy of the projections of the Parent
of the operating budget and cash flow budget of the Parent for the succeeding fiscal year, such projections to be accompanied by a certificate of a Responsible Officer of the Parent certifying that
such projections have been prepared in good faith based upon reasonable assumptions; 

        (iv)    promptly
upon receipt thereof, copies of all reports submitted to the Parent by independent certified public accountants in connection with each annual, interim or
special audit of the books and records of the Purchaser made by such accountants, including, without limitation, any management letter commenting on the Purchaser's internal controls submitted by such
accountants to management in connection with their annual audit; 

        (v)    within
fifteen (15) days after the same are sent, copies of all financial statements and reports which the Parent sends to its stockholders, and within fifteen
(15) days after the same are filed, copies of all financial statements and reports which the Parent may make to, or file with, the Securities and Exchange Commission or any successor or
analogous Governmental Authority; and 

        (vi)    promptly
upon the filing thereof, copies of all registrations statements (other than the exhibits thereto and any registration statements on Form S-8
or its equivalent) and reports on Forms 10-K, 10-Q and 8-K (or their equivalents) (other than the exhibits thereto, which exhibits will be provided upon request
therefor by any Bank) which the Parent shall have filed with the Securities and Exchange Commission. 

        (k)    Other Information.    Such other information (financial or otherwise) concerning the business, properties,
condition (financial or otherwise) or prospects of the Borrower or the General Partner, as the Administrative Agent or any Bank shall reasonably request. 

All
quarterly and annual statements and certificates shall be certified as being accurate and correct in all material respects by a Responsible Officer of the Parent. 

        8.02    Payment of Taxes.    The Borrower will pay and discharge all material taxes, assessments, and governmental
charges or levies imposed upon it, or them, or upon its, or their, income or profits, or upon any property belonging to it, or them, before the date upon which interest or penalties attach thereto,
and all lawful claims for sums that have become due and payable which, if unpaid, might become a lien not otherwise permitted hereunder; provided,  however,
that the Borrower shall not be 

42

 

required
to pay any such tax, assessment, charge, or levy if and so long as the amount, applicability, or validity thereof shall currently be contested in good faith by appropriate proceedings and
appropriate reserves therefor have been established in accordance with GAAP. 

        8.03    Maintenance of Existence and Rights.    Each Borrower will preserve and maintain its existence. The Borrower
shall further preserve and maintain all of its rights, privileges, and franchises necessary in the normal conduct of its business and in accordance with all valid regulations and orders of any
Governmental Authority the failure of which constitutes a Material Adverse Event. 

        8.04    Other Notices.    The Borrower will promptly notify the Administrative Agent in writing upon becoming aware of
(a) any change in its financial condition or its business, in each case if such change constitutes a Material Adverse Event, (b) any default under any material agreement, contract, or
other instrument to which the Borrower is a party or by which any of its properties are bound, or any acceleration of the maturity of any material indebtedness owing by the Borrower, in each case if
it
constitutes a Material Adverse Event, (c) any claim against or affecting the Borrower or any of its properties which constitutes a Material Adverse Event, or (d) the commencement of, and
any determination in, any litigation with any third party or any proceeding before any Governmental Authority affecting any Borrower if such commencement or determination constitutes a Material
Adverse Event. 

        8.05    Compliance with Loan Documents.    The Borrower will promptly comply with any and all covenants and provisions
of this Agreement and all other Loan Documents executed by it. 

        8.06    Operations and Properties.    Each Borrower will, and each Borrower will cause each of its Subsidiaries (if
any) to, act prudently and in accordance with customary industry standards in maintaining, managing or operating its assets, properties, business, and investments so as not to cause a Material Adverse
Event; each Borrower will, and each Borrower will cause each of its Subsidiaries (if any) to, keep in good working order and condition, ordinary wear and tear excepted, all of its assets and
properties which are necessary to the conduct of their respective businesses so as not to cause a Material Adverse Event. 

        8.07    Books and Records; Access.    Upon the receipt of at least five (5) Business Days prior written notice,
each Borrower will give any representative of the Administrative Agent or the Banks, or any of them, access during all normal business hours to, and permit such representative to examine, copy, or
make excerpts from, any and all books and records in the possession of such Borrower and relating to its affairs, to visit any of the properties of such Borrower and to meet with its financial
officers and accountants. Prior to an Event of Default, such inspection shall be at the expense of the Administrative Agent or such Bank, as the case may be; during the continuance of an Event of
Default while any Obligations are outstanding, such inspection shall be at the expense of Borrower, payable upon ten (10) Business Days prior written notice. 

        8.08    Compliance with Law.    Each Borrower will comply with all applicable laws (including, without limitation, all
Environmental Laws), rules, regulations, and all orders of any Governmental Authority, a breach of which constitutes a Material Adverse Event. 

        8.09    REIT Status.    The Borrower covenants and agrees that the Parent shall at all times continue to be
(i) qualified as a real estate investment trust as defined in Section 856 of the Code, (ii) entitled to a dividends paid deduction under Section 857 of the Code with
respect to dividends paid by it with respect to each taxable year for which it claims a deduction on its Form 1120-REIT filed with the United States Internal Revenue Service for
such year, or the entering into by the Purchaser of any material "prohibited transactions" as defined in Sections 857(b) and 856(c) of the Code, and (iii) a publicly traded company listed,
quoted or traded on the New York Stock Exchange, NASDAQ or any such other nationally recognized stock exchange. 

43

 

        8.10    Insurance.    Each Borrower will maintain workmen's compensation insurance, liability insurance, and insurance
on their respective present and future properties, assets, and business against such casualties, risks, and contingencies, and in such types and amounts, as are consistent with customary practices and
standards of the real estate industry and the failure of which to maintain constitutes a Material Adverse Event. The Borrower will furnish to the Administrative Agent, upon written request, full
information as to the insurance carried. 

        8.11    Authorizations and Approvals.    Each Borrower will promptly obtain, from time to time at its own expense, all
such governmental licenses, authorizations, consents, permits and approvals as may be required to enable it to comply with its obligations hereunder and under the other Loan Documents to which it is a
party. 

        8.12    Maintenance of Liens.    Each Borrower shall perform all such acts and execute all such documents as the
Administrative Agent may reasonably request in order to enable the Banks to report, file, and record every instrument that the Administrative Agent may reasonably deem necessary or advisable in order
to preserve and protect the rights of the Banks as provided for in the Loan Documents. 

        8.13    Further Assurances.    Each Borrower will make, execute or endorse, and acknowledge and deliver or file or
cause the same to be done, all such vouchers, invoices, notices, certifications, and additional agreements, undertakings, conveyances, transfers, assignments, financing statements, or other
assurances, and take any and all such other action, as the Administrative Agent may, from time to time, reasonably deem necessary or proper in connection with this Agreement or any of the other Loan
Documents or the obligations of the Borrower hereunder or thereunder. 

        8.14    ERISA.    (i)    The Borrower shall take all actions necessary so that at all times on and after the
Effective Date the assets of the Borrower will not constitute the assets of any Employee Benefit Plan within the meaning of the Plan Asset Regulations and the Overall Transaction will not constitute a
nonexempt prohibited transaction (as such term is defined in Section 4975 of the Code and/or Section 406 of ERISA) that could subject the Administrative Agent and/or the Banks to any tax
or penalty on prohibited transactions imposed under Section 4975 of the Code and/or Section 502(i) of ERISA. 

        (ii)    As
soon as possible and, in any event, within ten (10) days after the Borrower, any Subsidiary of the Borrower or any ERISA Affiliate knows or has reason to know
of the occurrence of any of the following, the Borrower will deliver to each of the Banks a certificate setting forth the full details as to such occurrence and the action, if any, that the Borrower,
such Subsidiary or such ERISA Affiliate is required or proposes to take, together with any notices required or proposed to be given or filed by such Borrower, such Subsidiary, the Plan administrator
or such ERISA Affiliate to or with the PBGC or any other government agency, or a Plan participant and any notices received by such Borrower, such Subsidiary or ERISA Affiliate from the PBGC or any
other government agency, or a Plan participant with respect thereto: that a Reportable Event has occurred (except to the extent that the Borrower has previously delivered to the Banks a certificate
and notices (if any) concerning such event pursuant to the next clause hereof); that a contributing sponsor (as defined in Section 4001(a)(13) of ERISA) of a Plan subject to Title IV of ERISA
is subject to the advance reporting requirement of PBGC Regulation Section 4043.61 (without regard to subparagraph (b)(1) thereof), and an event described in subsection .62, .63, .64, .65, .66,
..67 or .68 of PBGC Regulation Section 4043 is reasonably expected to occur with respect to such Plan within the following thirty (30) days; that an accumulated funding deficiency, within
the meaning of Section 412 of the Code or Section 302 of ERISA, has been incurred or an application may be or has been made for a waiver or modification of the minimum funding standard
(including any required installment payments) or an extension of any amortization period under Section 412 of the Code or Section 303 or 304 of ERISA with respect to a Plan; that any
contribution required to 

44

 

be
made with respect to a Plan or Foreign Pension Plan has not been timely made; that a Plan has been or may be terminated, reorganized, partitioned or declared insolvent under Title IV of ERISA; that
a Plan has an Unfunded Current Liability; that proceedings may be or have been instituted to terminate or appoint a trustee to administer a Plan which is subject to Title IV of ERISA; that a
proceeding has been instituted pursuant to Section 515 of ERISA to collect a delinquent contribution to a Plan; that the Borrower, any Subsidiary of the Borrower or any ERISA Affiliate will or
may incur any liability (including any indirect, contingent, or secondary liability) to or on account of the termination of or withdrawal from a Plan under Section 4062, 4063, 4064, 4069, 4201,
4204 or 4212 of ERISA or with respect to a Plan under Section 401(a)(29), 4971, 4975 or 4980 of the Code or Section 409, 502(i) or 502(l) of ERISA or with respect to a group
health plan (as defined in Section 607(l) of ERISA or Section 4980B(g)(2) of the Code) under Section 4980B of the Code; or that the Borrower or any Subsidiary of the Borrower may
incur any material liability pursuant to any employee welfare benefit plan (as defined in Section 3(1) of ERISA) that provides benefits to retired employees or other former employees (other
than as required by Section 601 of ERISA) or any Plan or any Foreign Pension Plan. The Borrower will deliver to each of the Banks copies of any records, documents or other information that must
be furnished to the PBGC with respect to any Plan pursuant to Section 4010 of ERISA. Upon request, the Borrower will also deliver to the Administrative Agent a complete copy of the annual
report (on Internal Revenue Service Form 5500-series) of each Plan (including, to the extent required, the related financial and actuarial statements and opinions and other
supporting statements, certifications, schedules and information) required to be filed with the Internal Revenue Service. In addition to any certificates or notices delivered to the Banks pursuant to
the first sentence hereof, any records, documents or other information required to be furnished to the PBGC or any other government agency, and any material notices received by the Borrower, any
Subsidiary of the Borrower or any ERISA Affiliate with respect to any Plan or Foreign Pension Plan shall be delivered to the Administrative Agent no later than ten (10) days after the date such
records, documents and/or information has been furnished to the PBGC or any other government agency or such notice has been received by the Borrower, the Subsidiary or the ERISA Affiliate, as
applicable. The Borrower and each of its applicable Subsidiaries shall ensure that all Foreign Pension Plans administered by it or into which it makes payments obtains or retains (as applicable)
registered status under and as required by applicable law and is administered in a timely manner in all respects in compliance with all applicable
laws except where the failure to do any of the foregoing would not be reasonably likely to result in a Material Adverse Event. 

        8.15    Legal Separateness, Etc.    So as to ensure the legal separateness of each Borrower from the other, each
Borrower covenants and agrees that it shall take all such action as is necessary to keep such entities legally separate and apart from each other including, without limitation, ensuring that all
customary formalities regarding its existence are followed. 

45

  

 
 

SECTION 9
  
    NEGATIVE COVENANTS    
    

        The Borrower covenants and agrees that on and after the Effective Date and until the Total Commitment has terminated and the Loans and the Notes, together with
interest, Fees and all other Obligations incurred hereunder and thereunder and under the other Loan Documents to which the Borrower is a party, are paid and performed in full: 

        9.01    Mergers, Etc.    No Borrower shall enter into any merger, consolidation or amalgamation, or liquidate, wind up
or dissolve itself (or suffer any liquidation or dissolution), or convey, sell, lease, assign, transfer or otherwise dispose of, all or substantially all of its property, business or assets, or make
any material changes in its present method of conducting business, except any Subsidiary of the Parent may be merged or consolidated with or into the Parent
(provided that the Parent shall be the continuing or surviving entity). 

        9.02    Negative Pledge.    No Borrower will create or suffer to exist, or permit any Subsidiary (with the exception
of Other Subsidiaries) to create or suffer to exist any mortgage, pledge, security interest, assignment, conditional sale or other title retention agreement, charge, encumbrance, or other Lien
(whether such interest is based on common law, statute, other law or contract) upon the Collateral or any other property of such Borrower or Subsidiary other than as contemplated by the Collateral
Documents. 

        9.03    Fiscal Year and Accounting Method.    Borrower will not change its respective fiscal year or method of
accounting. 

        9.04    Governing Documents.    Without the prior written consent of the Administrative Agent and the Required Banks,
the Borrower shall not alter, amend, modify terminate, or change any provision of the Governing Documents if the effect thereof would constitute a Material Adverse Event. With respect to any other
proposed amendment, modification or change to the Governing Documents, the Borrower shall be required to obtain the prior written consent of the Administrative Agent, such consent not to be
unreasonably withheld, conditioned or delayed, prior to the effectiveness of such amendment, modification or change. 

        9.05    Filing of Agreement.    Unless required to do so by law or applicable rules and regulations, Borrower will not
file or post, and will not permit the filing or posting (electronically or otherwise) of, this Agreement or any of the other Loan Documents with the Securities and Exchange Commission. 

        9.06    Financial Covenants.    

        (a)    Maximum Total Liabilities Ratio.    At no time shall the Total Liabilities Ratio of the Borrower (on a
consolidated basis) exceed eighty-five percent (85%). 

        (b)    Minimum Liquidity Requirement.    At no time shall the Parent maintain less than $10,000,000 in Cash and Cash
Equivalents. 

        (c)    Fixed Charge Coverage Ratio.    At no time shall the Fixed Charge Coverage Ratio of the Borrower (on a
consolidated basis) be less than 1.50 to 1.00. 

        (d)    Minimum Interest Coverage Ratio.    At no time shall the Interest Coverage Ratio of the Borrower (on a
consolidated basis) be less than 1.75 to 1.00. 

        (e)    Minimum Tangible Net Worth.    At no time shall the Tangible Net Worth of the Borrower (on a consolidated
basis) be less than the greater of (i) $40,000,000, and (ii) seventy-five percent (75%) of the net proceeds of any Equity Issuance (including, without limitation, the IPO)
from and after the date of this Agreement by the Parent. 

46

 

        (f)    Prohibition on Additional Indebtedness.    On a consolidated basis, the Borrower shall at no time be obligated
for any Indebtedness in excess of $100,000,000 in the aggregate, which Indebtedness shall, for purposes hereof, include, inter alia, (i) the Borrower's obligations under this Agreement,
(ii) the Borrower's obligations under the Guarantee Agreement executed pursuant to, and as that term is defined in, the Master Repurchase Agreement, (iii) the Borrower's obligations
under the Acquisition Repurchase Agreement, and (iv) any Contingent Liabilities of the Borrower (on a consolidated basis), but which shall exclude (x) standard recourse
carve-out guarantees, and (y) customary and standard trade payables incurred by the Parent in the ordinary course of business, provided that (a) the aggregate amount of any
such outstanding trade payables shall at no time exceed $500,000, and (b) any such trade payable amounts shall be paid by the Parent within sixty (60) days of when they were incurred,
and (z) fees payable under the Management Contract as in effect on the date hereof. 

        (g)    Distributions.    The Parent shall not shall not declare or make any payment on account of, or set apart assets
for, a sinking or other analogous fund for the purchase, redemption, defeasance, retirement or other acquisition of any equity or partnership interest of the Parent, whether now or hereafter
outstanding, or make any other distribution in respect thereof, either directly or indirectly, whether in cash or property or in obligations of the Parent, except, so long as no Default or Event of
Default shall have occurred and be continuing, the Parent may make such payments solely to the extent necessary to preserve the status of the Parent as a REIT and to make payments subject to the
following restrictions: (1) during the first year following the Effective Date of this Agreement, the Parent may make payments in an amount equal to (a) 103% of FFO only if a dividend
payment is made to reimburse certain original shareholders for expenses associated with the capitalization of the Parent, or (b) 100% of FFO if no such dividend payment is made, and
(2) after the first year following the Effective Date, the Parent may make payments in an amount equal to 100% of FFO. 

        (h)    Buy Back of Capital Stock.    The Parent shall not (i) buy back any of its Capital Stock while this
Agreement remains in effect, or (ii) exchange or permit the exchange of any of its Capital Stock in connection with and/or in consideration for any internalization of the management of the
Parent. 

        (i)    Payment of Third Party Management Fees.    Fees paid under the Management Contract (or any replacement or
substitution thereof) shall at no time exceed the fees payable under the Management Contract on the date of the IPO. 

        (j)    Positive Net Income.    Parent's Net Income shall be positive at all times following the first anniversary of
the Effective Date of this Agreement. 

        (k)    Qualified Transferee.    The Parent, or any Subsidiary thereof, that is at any time the
[obligee] with respect to any Eligible Asset shall at no time fail to meet the requirements to be a [Qualified Transferee] of such Eligible Asset. 

The
covenants set forth in Section 9.06(a), (b), (c), (d) and (e) above shall be tested by the Administrative Agent on a calendar quarter basis. 

        9.07    Additional Subsidiary Indebtedness.    The Parent shall not allow or suffer to exist any Indebtedness on the
part of any new or hereafter existing Subsidiary unless the Parent shall have first delivered to the Administrative Agent a substantive nonconsolidation opinion of counsel with respect to the Parent,
such Subsidiary and the Parent's obligations and liability with respect to such Indebtedness, such substantive nonconsolidation opinion to be in form, substance and content, and issued by a law firm,
acceptable to the Administrative Agent in all respects. 

        9.08    Limitation on Distributions.    Except to the extent otherwise specifically provided for herein, the Parent
shall not declare or make any payment on account of, or set apart assets for, a sinking or other analogous fund for the purchase, redemption, defeasance, retirement or other acquisition of any Equity
Interest of the Parent, whether now or hereafter outstanding, or make any other distribution in respect thereof, either directly or indirectly, whether in cash or property or in obligations of the
Parent, 

47

 

 except, so long as no Incipient Default, Event of Default or Margin Deficit (under, and as that term is defined in, the Master Repurchase Agreement and/or the Acquisition
Repurchase Agreement, as applicable), shall have occurred and be continuing, the Parent may make such payments solely to the extent necessary to preserve the status of the Parent as a REIT. 

 
 

SECTION 10
  
    EVENTS OF DEFAULT    
    

        10.01    Events of Default.    An "Event of Default" shall exist if any one or more of the following events (herein
collectively called "Events of Default") shall occur and be continuing: 

        (a)    the
Borrower shall fail to pay when due (x) any principal of the Notes (including, without limitation, any Mandatory Prepayments), (y) interest on the
Notes and such failure continues for five (5) Business Days following the date such payment was due, or (z) any Fee, expense, or other payment required hereunder, and, in the case of any
such interest, fee, expense, or other payment (other than principal), such failure shall continue for ten (10) days following the date such payment was due; or 

        (b)    any
material representation or warranty made (or deemed made) by any Loan Party under this Agreement, or any of the other Loan Documents executed by it, or in any
certificate or statement furnished or made to the Administrative Agent or the Banks or any of them pursuant hereto or in connection herewith or with the Loans, shall prove to be untrue or inaccurate
in any respect as of the date on which such representation or warranty is made; or 

        (c)    any
default shall occur in the performance of any of the covenants or agreements contained herein (other than the covenants contained in Section 8 or 9), or of
the covenants or agreements of the Loan Parties contained in any other Loan Document executed by any of them, and such default shall continue uncured to the satisfaction of the Administrative Agent
for a period of thirty (30) days after written notice thereof has been given by the Administrative Agent to the Borrower; or 

        (d)    any
default shall occur in the performance of any of the covenants or agreements of the Borrower contained in Section 8 or 9 hereof; or 

        (e)    any
of the Loan Documents executed by the Loan Parties shall cease, in whole or in any material part, or any Loan Party shall claim or assert that any of such Loan
Documents have ceased, in whole or in part, to be legal, valid, binding agreements enforceable against the Loan Parties in accordance with the terms thereof, or any of the Loan Documents shall in any
way be terminated or become ineffective or inoperative or shall in any way whatsoever cease to give or provide the respective rights, titles, interest, remedies, powers, or privileges intended to be
created thereby; or 

        (f)    an
Act of Insolvency shall have occurred with respect to any Borrower or any Subsidiary of any Borrower (including, without limitation, any Newly Formed Subsidiary); or 

        (g)    any
final judgment(s) for the payment of money in excess of the sum of $500,000 per occurrence or in the aggregate shall be rendered against any Borrower and such
judgment or judgments shall not have been satisfied or vacated, discharged or stayed or bonded pending appeal within thirty (30) days after the entry thereof; or 

        (h)    any
Borrower shall (x) default in any payment of any Indebtedness beyond the period of grace, if any, provided in the instrument or agreement under which such
Indebtedness was created or (y) default in the observance or performance of any agreement or condition relating to any Indebtedness or contained in any instrument or agreement evidencing,
securing or relating thereto, or any other event shall occur or condition exist, in each case the effect of which default or other event is to cause, or to permit the holder or holders of such
Indebtedness (or a trustee agent on behalf of such holder or holders) to cause (determined without regard to whether any notice is required), any such 

48

 

Indebtedness
to become due prior to its stated maturity; or any Indebtedness of the Borrower shall be declared to be due and payable, or required to be prepaid other than by a regularly scheduled
required prepayment, prior to the stated maturity thereof; or 

        (i)    the
Custodial Agreement or the Account Control Agreement or a replacement therefor acceptable to the Administrative Agent shall for whatever reason be terminated by the
Borrower or cease to be in full force and effect (other than due to causes solely within the control of the Administrative Agent or Custodian), or the enforceability thereof shall be contested by any
Borrower; or 

        (j)    there
shall occur any change in the condition (financial or otherwise) of the Borrower which constitutes, either individually or together with any other such change, a
Material Adverse Event; or 

        (k)    a
Change of Control of any Borrower shall occur; or 

        (l)    a
Change of Control of the Parent shall occur; or 

        (m)    the
Parent shall cease at any time to qualify as a real estate investment trust under the Code or to be a publicly traded company, listed, quoted or traded on the New
York Stock Exchange, NASDAQ or any such other nationally recognized stock exchange; or 

        (n)    if
any Termination Event with respect to a Plan shall occur as a result of which Termination Event or Events any member of the ERISA Group has incurred or will incur any
liability to the PBGC or any other Person and the sum (determined as of the date of occurrence of such Termination Event) of the insufficiency of such Plan and the insufficiency of any and all other
Plans with respect to which such a Termination Event shall occur and be continuing at the same time (or, in the case of a Multiple Employer Plan with respect to which a Termination Event described in
clause (ii) of the definition of Termination Event shall occur and be continuing at the same time, the liability of either Borrower) is equal to or greater than $1,000,000; or 

        (o)    if,
any member of the ERISA Group shall commit a failure described in Section 402(f)(1) of ERISA or Section 412(n)(1) of the Code and the amount of the
lien determined under Section 402(f)(3) of ERISA or Section 412(n)(3) of the Code that will be imposed on any member of the ERISA Group or their assets in respect of such failure shall
be equal to or greater than $1,000,000; or 

        (p)    if
there shall occur any [Event of Default] under, and as that term is defined in, the Acquisition Repurchase Agreement or the Master Repurchase
Agreement; or 

        (q)    if
Gramercy Capital Manager LLC, a                        limited liability company ("GCM") or any Affiliate of GCM or SLG shall
ever cease to be the Manager under the Management Contract; 

        (r)    if
any Newly Formed Subsidiary, if required by the Administrative Agent to be a Special Purpose Entity, fails at any time to comply with all of the requirements of being
a Special Purpose Entity, as such requirements are set forth in the definition thereof; or 

        (s)    the
Management Contract shall be amended to increase the amount of compensation required to be paid to the Manager thereunder, or the Management Contract shall be
otherwise materially amended to the detriment of the Parent, or the Manager shall be terminated, in any case without the prior written consent of the Administrative Agent; or 

        (t)    upon
the failure by the Parent to satisfy any of the following asset or income tests: 

        (i)    At
the close of each taxable year, at least 75 percent of the Parent's gross income consists of (i) "rents from real property" within the meaning of
Section 856(c)(3)(A) of the Code, (ii) interest on obligations secured by mortgages on real property or on interests in real property, within the meaning of Section 856(c)(3)(B)
of the Code, (iii) gain from the sale or other 

49

 

disposition
of real property (including interests in real property and interests in mortgages on real property) which is not property described in Section 1221(a)(1) of the Code, within the
meaning of Section 856(c)(3)(C) of the Code, (iv) dividends or other distributions on, and gain (other than gain from "prohibited transactions" within the meaning of
Section 857(b)(6)(B)(iii) of the Code) from the sale or other disposition of, transferable shares (or transferable certificates of beneficial interest) in other qualifying REITs within
the meaning of Section 856(d)(3)(D) of the Code, and (v) amounts described in Sections 856(c)(3)(E) through 856(c)(3)(I) of the Code. 

        (ii)    At
the close of each taxable year, at least 95 percent of the Parent's gross income consists of (i) the items of income described in paragraph 1
hereof (other than those described in Section 856(c)(3)(I) of the Code), (ii) gain realized from the sale or other disposition of stock or securities which are not property
described in Section 1221(a)(1) of the Code, (iii) interest, (iv) dividends, and (v) income derived from payments to Seller on interest rate swap or cap agreements,
options, futures contracts, forward rate agreements and other similar financial instruments entered into to reduce the interest rate risks with respect to any indebted ness incurred or to be incurred
to acquire or carry real estate assets, or gain from the sale or other disposition of such an investment as described in Section 856(c)(5)(G), in each case within the meaning of
Section 856(c)(2) of the Code. 

        (iii)    At
the close of each quarter of the Parent's taxable years, at least 75 percent of the value of Parent's total assets (as determined in accordance with Treasury
Regulations Section 1.856-2(d)) has consisted of and will consist of real estate assets within the meaning of Sections 856(c)(4) and 856(c)5(B) of the Code, cash and cash items
(including receivables which arise in the ordinary course of the Parent's operations, but not including receivables purchased from another person), and government securities. 

        (iv)    At
the close of each quarter of each of the Parent's taxable years, (i) not more than 25 percent of the Parent's total asset value will be represented by
securities (other than those described in paragraph (iii), (ii) not more than 20 percent of the Parent's total asset value will be represented by securities of one or
more taxable REIT subsidiaries, and (iii) (a) not more than 5 percent of the value of the Parent's total assets will be represented by securities of any one issuer (other than
Government securities and securities of taxable REIT subsidiaries, and securities of a qualified REIT subsidiary within the meaning of Section 856(i) of the Code) of any of the REIT
qualification tests pursuant to Section 856(c) of the Code. 

        10.02    Remedies Upon Event of Default.    If an Event of Default shall have occurred and be continuing, then the
Administrative Agent may, and, if directed in writing by the Required Banks, shall (a) terminate the Commitments of the Banks hereunder, (b) declare the principal of, and all interest
then accrued on, the Notes and any other liabilities hereunder to be forthwith due and payable, whereupon the same shall forthwith become due and payable without presentment, demand, protest, notice
of default, notice of acceleration, or of intention to accelerate or other notice of any kind all of which the Borrower hereby expressly waives, anything contained herein, in any Note or any other
Loan Document to the contrary notwithstanding, (c) exercise any right, privilege, or power set forth in the Collateral Documents, and/or (d) without notice of default or demand, pursue
and enforce any of the rights and remedies of the Administrative Agent and/or the Banks under the Loan Documents, or otherwise provided under or pursuant to any applicable law or agreement  provided,
however, that if any Event of Default specified in Section 10.01(f) shall occur with
respect to any Borrower or any Newly Formed Subsidiary, the Commitments of the Banks hereunder shall terminate and the principal of, and all interest on, the Notes and other liabilities hereunder
shall thereupon become due and payable concurrently therewith, without any further action by the Administrative Agent or the Banks, or any of them, and without presentment, demand, protest, notice of
default, notice of acceleration, or of intention to accelerate or other notice of any kind, all of which the Borrower hereby expressly waives. 

50

 

        10.03    Performance by Administrative Agent.    During the continuance of any Event of Default while any Obligations
are outstanding, should the Borrower fail to perform any covenant, duty, or agreement contained herein or in any of the Loan Documents, the Administrative Agent may perform or attempt to perform such
covenant, duty, or agreement on behalf of the Borrower. In such event, the Borrower shall, at the request of the Administrative Agent, promptly pay any amount expended by the Administrative Agent in
such performance or attempted performance to the Administrative Agent at its principal office in New York, New York, together with interest thereon at the Default Rate from the date of such
expenditure until paid. Notwithstanding the foregoing, it is expressly understood that neither the Administrative Agent nor the Banks assume any liability or responsibility for the performance of any
duties of the Borrower hereunder or any of the Loan Documents or other control over the management and affairs of the Borrower, nor by any such action shall the Administrative Agent or the Banks be
deemed to create a partnership arrangement with the Borrower. 

 
 

SECTION 11
  
    THE ADMINISTRATIVE AGENT    
    

        11.01    Appointment.    Each Bank hereby irrevocably designates and appoints
[                        ] as Administrative Agent (for purposes of this Section 11, the term "Administrative Agent" shall
include [                        ], in
its capacity as Administrative Agent pursuant to the Collateral Documents, except as may be specifically provided in such Collateral Documents) to act as specified herein and in the other Loan
Documents, and each such Bank hereby irrevocably authorizes, and each holder of any Note by the acceptance of such Note shall be deemed irrevocably to authorize, the Administrative Agent to take such
actions, exercise such powers and perform such duties as are expressly delegated to or conferred upon the Administrative Agent by the terms of this Agreement, the other Loan Documents and any other
instruments and agreements referred to herein or therein, together with such other powers as are reasonably incidental thereto. The Administrative Agent agrees to act as such upon the express
conditions contained in this Section 11. The Administrative Agent shall not have any duties or responsibilities except those expressly set forth herein or in the other Loan Documents, nor shall
it have any fiduciary relationship with any Bank, and no implied covenants, responsibilities, duties, obligations or liabilities shall be read into this Agreement or otherwise exist against the
Administrative Agent. The provisions of this Section 11 are solely for the benefit of the Administrative Agent and the Banks, the Borrower shall not have any rights as a third party beneficiary
of any of the provisions hereof. 

        11.02    Administration of Loans by Administrative Agent.    The Administrative Agent shall be responsible for
administering the Loans on a day-to-day basis. In the exercise of such administrative duties, the Administrative Agent shall use the same diligence and standard of care that is
customarily used by the Administrative Agent with respect to similar loans held by the Administrative Agent solely for its own account. 

        Each
Bank delegates to the Administrative Agent the full right and authority on its behalf to take the following specific actions in connection with its administration of the Loans: 

        (i)    to
fund Loans in accordance with the provisions of the Loan Documents; 

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

        (iii)    to
keep and maintain complete and accurate files and records of all material matters pertaining to the Loans, and make such files and records available for inspection
and copying by 

51

 

each
Bank and its respective employees and agents during normal business hours upon reasonable prior notice to the Administrative Agent; and 

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

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

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

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

        11.06    Notice of Default.    The Administrative Agent shall not be deemed to have knowledge or notice of the
occurrence of any Incipient Default or Event of Default unless the Administrative Agent has actual knowledge of the same or has received written notice from a Bank or the Borrower referring to this
Agreement, describing such Incipient Default or Event of Default and stating that such notice is 

52

 

a
"notice of default". In the event that the Administrative Agent obtains such actual knowledge or receives such a notice, the Administrative Agent shall give prompt notice thereof to each of the
Banks. Subject to Section 10.02, the Administrative Agent shall take such action with respect to such Incipient Default or Event of Default as shall be reasonably directed by the Required
Banks. Unless and until the Administrative Agent shall have received such direction, the Administrative Agent may (but shall not be obligated to) take such action, or refrain from taking such action,
with respect to any such Incipient Default or Event of Default as it shall deem advisable in the best interest of the Banks; and the Administrative Agent shall not incur liability to any Person by
reason of so acting or refraining from acting. Without limiting the foregoing, no Bank or the holder of any Note shall have any right of action whatsoever against the Administrative Agent as a result
of the Administrative Agent acting or refraining from acting hereunder or under any other Loan Document in accordance with the instructions of the Required Banks. Notwithstanding the foregoing, the
Administrative Agent may, but shall not be required to accelerate the Obligations under this Agreement without the prior written direction of the Required Banks. 

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

        11.08    Administrative Agent's Reimbursement and Indemnification.    To the extent the Administrative Agent is not
fully reimbursed and indemnified by the Borrower within five (5) Business Days after the delivery of a written request by the Administrative Agent to the Borrower for such reimbursement or
indemnification or, if earlier, upon receipt by the Administrative Agent of a refusal from the Borrower to comply with such request, the Banks agree to promptly reimburse and indemnify the
Administrative Agent, ratably in proportion to their respective Commitments, for (i) any amounts not reimbursed by the Borrower for which the Administrative Agent is entitled to reimbursement
by the Borrower under this Agreement or the other Loan Documents, (ii) any other expenses incurred by the Administrative Agent on behalf of the Banks in connection with the preparation,
execution, delivery, administration, amendment, waiver and/or enforcement of this Agreement and the other Loan Documents, and (iii) any liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind and nature whatsoever which may imposed on, incurred by or asserted against the Administrative Agent in any way relating to or
arising out of this Agreement or the other Loan Documents or any other document delivered in connection therewith or any transaction contemplated thereby, or the enforcement of any of the terms hereof
or thereof, provided that no Bank shall be liable for any of the foregoing to the extent that they arise from the gross negligence or willful misconduct
of the Administrative Agent. If any indemnity furnished to the Administrative Agent for any purpose shall, in the opinion of the Administrative Agent, be insufficient or become impaired, the
Administrative Agent may call for additional indemnity and cease, or not commence, to do the action indemnified against until such additional indemnity is furnished. 

        11.09    Administrative Agent in its Individual Capacity.    With respect to its obligation to make Loans under this
Agreement, the Administrative Agent shall have the rights and powers specified herein and in the other Loan Documents for a "Bank", and may exercise the same rights and powers as though it were not
performing the duties specified herein; and the term "Banks," "Required Banks," 

53

 

"holders
of Notes," or any similar terms shall, unless the context clearly otherwise indicates, include the Administrative Agent in its individual capacity. The Administrative Agent may accept
deposits from, lend money to, and generally engage in any kind of banking, trust or other business with the Borrower or any Affiliate of the Borrower as if it were not performing the duties specified
herein, and may accept fees and other consideration from the Borrower for services in connection with this Agreement and otherwise without having to account for the same to the Banks. 

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

        11.11    Successor Administrative Agent.    (a)    The Administrative Agent may resign at any time by giving
sixty (60) days' prior written notice to the Banks and Borrower. Such resignation shall take effect upon the appointment of a successor Administrative Agent as provided in this
Section 11.11. Upon any such
resignation, the Required Banks shall have the right to appoint a successor Administrative Agent. If no Event of Default shall have occurred and be continuing, such successor Administrative Agent
shall have been approved by the Borrower, such approval not to be unreasonably withheld, conditioned or delayed. If no successor Administrative Agent shall have been so appointed by the Required Banks
and accepted such appointment within thirty (30) days after the retiring Administrative Agent's giving notice of resignation, then the retiring Administrative Agent may appoint, on behalf of
the Borrower and the Banks, a successor Administrative Agent. Each such successor Administrative Agent shall be a financial institution which meets the requirements of an Eligible Assignee. In the
event of a final and binding judicial determination by a court of competent jurisdiction of gross negligence or willful misconduct with respect to the manner in which the Administrative Agent has
carried out its duties hereunder, the Administrative Agent may be removed as Administrative Agent (and a successor appointed) under the Loan Documents at any time after such determination by the
Required Banks upon at least thirty (30) days' prior written notice to the Administrative Agent and the Borrower. Upon the acceptance of any appointment as Administrative Agent hereunder by a
successor Administrative Agent, such successor Administrative Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Administrative
Agent, and the retiring Administrative Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents. After any retiring Administrative Agent's resignation
hereunder, the provisions of this Section 11 shall continue in effect for its benefit in respect of any actions taken or omitted to be taken by it while it was acting as the Administrative
Agent hereunder. 

        (b)    Notwithstanding
anything to the contrary set forth in Section 11.11(a) above, for so long as no Event of Default or Incipient Default exists, the Administrative
Agent shall not resign without the prior consent of Borrower. 

        11.12    Duties in the Case of Enforcement.    In case one or more Events of Default have occurred and shall be
continuing, and whether or not acceleration of the Obligations shall have occurred, the Administrative Agent shall, at the request, or may, upon the consent, of the Required Banks, and  provided that the
Banks have given to the Administrative Agent such additional indemnities and assurances against expenses and liabilities as the
Administrative Agent may reasonably request, proceed to enforce the provisions of this Agreement and the other Loan Documents respecting the sale or other disposition of all or any part of the
Collateral and the exercise of any other legal or equitable rights or remedies as it may have hereunder or under any other Loan Document or otherwise by virtue of applicable law, or to refrain from so
acting if similarly requested by the Required Banks. The Administrative Agent shall be fully protected in so acting or refraining from acting upon the instruction 

54

 

of
the Required Banks, and such instruction shall be binding upon all the Banks. The Required Banks may direct the Administrative Agent in writing as to the method and the extent of any such
foreclosure, sale or other disposition or the exercise of any other right or remedy, the Banks hereby agreeing to indemnify and hold the Administrative Agent harmless from all costs and liabilities
incurred in respect of all actions taken or omitted in accordance with such direction, provided that the Administrative Agent need not comply with any
such direction to the extent that the Administrative Agent reasonably believes the Administrative Agent's compliance with such direction to be unlawful or commercially unreasonable in any applicable
jurisdiction. The Administrative Agent may, in its discretion but without obligation, in the absence of direction from the Required Banks, take such interim actions as it believes necessary to
preserve the rights of the Banks hereunder and in and to any Collateral securing the Obligations, including but not limited to petitioning a court for injunctive relief, appointment of a receiver or
preservation of the proceeds of any Collateral. Each of the Banks acknowledges and agrees that no individual Bank may separately enforce or exercise any of the provisions of any of the Loan Documents,
including without limitation the Notes, other than through the Administrative Agent. 

55

  

 
 

SECTION 12
  
  MISCELLANEOUS    
    

        12.01    Payment of Expenses, Etc; Indemnification.    (a)    The Borrower shall: (i) whether or not
the transactions herein contemplated are consummated, pay, within ten (10) days after demand from the Administrative Agent, all reasonable out-of-pocket costs and
expenses (including, without limitation, reasonable fees and disbursements of outside legal counsel, accounting, consulting, brokerage or other similar professional fees or expenses, and any
reasonable fees and expenses associated with travel or other costs relating to any appraisals or examinations conducted in connection with the Loans or the Collateral, and the amount of such costs and
expenses shall, until paid, bear interest at the rate applicable to Base Rate Loans (or the Default Rate, if applicable) and shall be an obligation secured by the Collateral) (x) of the
Administrative Agent (including, without limitation, the reasonable fees and disbursements of Cadwalader, Wickersham & Taft LLP) in connection with the preparation, execution and delivery of
this Agreement and the other Loan Documents (other than any Assignment and Acceptance Agreements) and the documents and instruments referred to herein and therein and the syndication of the
Commitments and (y) of the Administrative Agent and each of the Banks in connection with the enforcement of this Agreement and the other Loan Documents (other than any Assignment and Acceptance
Agreements) and any amendment, waiver or consent (other than an amendment, waiver or consent not requested by the Borrower in respect of an Assignment and Acceptance Agreement) relating hereto or
thereto and the documents and instruments referred to herein and therein (including, without limitation, the reasonable fees and disbursements of counsel for the Administrative Agent and the Banks);
(ii) pay and hold each of the Banks harmless from and against any and all present and future stamp, documentary, issue, sales and use, value added, property and other similar taxes (other than
taxes imposed on net income) with respect to the matters described in foregoing clause (i) and hold each of the Banks harmless from and against any and all liabilities with respect to or
resulting from any delay or omission to pay such taxes; and (iii) indemnify the Administrative Agent and each Bank, its officers, directors, employees, representatives and agents (the
"Bank Indemnitees") from and hold each of them harmless against any and all liabilities, obligations, losses, damages, penalties, claims, actions,
judgments, suits, costs, expenses and disbursements ("Losses") incurred by any of them as a result of, or arising out of, or in any way related to, or
by reason of, the entering into and/or performance of this Agreement or any other Loan Document or the use of the proceeds of any Loans hereunder or the consummation of any transactions contemplated
herein or in any other Loan Document, including, without limitation, the reasonable fees and disbursements of counsel incurred in connection with any such Losses and any environmental liabilities with
respect to any real estate or other assets held by the Borrower or any of its affiliates (but excluding any such Losses to the extent incurred by reason of the gross negligence or willful misconduct
of the Person to be indemnified). 

        (b)   The
Borrower agrees to indemnify and hold harmless the Administrative Agent, the Arranger and each Lender and each of their Affiliates and Subsidiaries and their
respective officers, directors, employees, agents, and advisors (each, an "Indemnified Party") from and against any and all claims, damages, losses,
liabilities, costs, and expenses (including, without limitation, reasonable attorneys' fees) that may be incurred by or asserted or awarded against any Indemnified Party, in each case arising out of
or in connection with or by reason of (including, without limitation, in connection with any investigation, litigation, or proceeding or preparation of defense in connection therewith) (i) the
Loan Documents, (ii) any of the transactions contemplated herein or the actual or proposed use of the proceeds of the Loans, (iii) any Hazardous Materials associated with any Eligible
Asset or any other property of any Borrower or any Subsidiary thereof and/or (iv) any violation of any Plan Asset Regulation, except to the extent such claim, damage, loss, liability, cost, or
expense is found in a final, non appealable judgment by a court of competent jurisdiction to have resulted from such Indemnified Party's gross negligence or willful misconduct. In the case of an
investigation, litigation or other 

56

 

proceeding
to which the indemnity in this Section 12.01 applies, such indemnity shall be effective whether or not such investigation, litigation or proceeding is brought by the Borrower, its
directors, shareholders or creditors or an Indemnified Party or any other Person or any Indemnified Party is otherwise a party thereto and whether or not the transactions contemplated hereby are
consummated. The Borrower agrees not to assert any claim against the Administrative Agent, the Sole Book Manager, the Sole Lead Arranger, any Bank, any of their Affiliates or Subsidiaries, or any of
their respective directors, officers, employees, attorneys, agents, and advisers, on any theory of liability, for special, indirect, consequential, or punitive damages arising out of or otherwise
relating to the Loan Documents, any of the transactions contemplated herein or the actual or proposed use of the proceeds of the Loans. 

        (c)   Without
prejudice to the survival of any other agreement of the Borrower hereunder, the agreements and obligations of the Borrower contained in this Section 12.01
shall survive the repayment of the Loans and other obligations under the Loan Documents and the termination of the Commitments hereunder. 

        12.02    Right of Setoff.    In addition to any rights now or hereafter granted under applicable law or otherwise, and
not by way of limitation of such rights, the Borrower hereby grants to each of the Banks a right of offset, to secure repayment of the Obligations, upon any and all monies, securities, collateral or
other property of the Borrower and the proceeds therefrom, now or hereafter held or received by the Administrative Agent or the Banks or any entity under the control of the Administrative Agent or any
of the Banks and their respective successors and assigns (including, without limitation, branches and agencies of the Administrative Agent or any of the Banks wherever located), for the account of the
Borrower, whether for safekeeping, custody, pledge, transmission, collection, or otherwise, and also upon any and all deposits (general or specified) and credits of the Borrower at any time existing.
The Banks are hereby authorized at any time and from time to time upon the occurrence and during the continuance of an Event of Default, without notice to the Borrower, to offset, appropriate, apply
and enforce such right of offset against any and all items hereinabove referred to against the Obligations, irrespective of whether the Banks shall have made any demand hereunder and although said
Obligations, or any of them, shall be contingent or unmatured and regardless of any other collateral securing the Loans. The Borrower shall be deemed directly indebted to the Banks in the full amount
of
the Obligations, and the Banks shall be entitled to exercise the rights of offset provided for above. ANY AND ALL RIGHTS TO REQUIRE THE ADMINISTRATIVE AGENT OR ANY OF THE BANKS TO EXERCISE ITS RIGHTS
OR REMEDIES WITH RESPECT TO ANY OTHER COLLATERAL WHICH SECURES THE LOANS, PRIOR TO EXERCISING ITS RIGHT OF OFFSET WITH RESPECT TO SUCH MONIES, SECURITIES, COLLATERAL, DEPOSITS, CREDITS OR OTHER
PROPERTY OF BORROWER, ARE HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED. 

        12.03    Notices.    Except as otherwise expressly provided herein, all notices and other communications provided for
hereunder shall be in writing (including telegraphic, telex, facsimile or cable communication) and mailed, telegraphed, telexed, telecopied, cabled or delivered: if to the Borrower, at its address
specified opposite its signature below, with a copy to [                        ], located at
[                        ],
[                        ],
[                        ], Attention:
[                        ], if to any Bank, at its Applicable Lending Office specified opposite its name on Schedule II; and
if to the Administrative Agent, at its Notice Office; or, as to the Borrower or the Administrative Agent, at such other address as shall be designated by such party in a written notice to the other
parties hereto and, as to each other party, at such other address as shall be designated by such party in a written notice to the Borrower and the Administrative Agent. All such notices and
communications shall, when mailed, telegraphed, telexed, telecopied, or cabled or sent by overnight courier, be effective when deposited in the mails, delivered to the telegraph company, cable company
or overnight courier, as the case may be, or sent by 

57

 

telex
or telecopier, except that notices and communications to the Administrative Agent shall not be effective until received by the Administrative Agent. 

        12.04    Benefit of Agreement; Participations; Additional Banks; Register; New Notes; Etc.    (a)    This
Agreement shall be binding upon and inure to the benefit of and be enforceable by the respective successors and permitted assigns of the parties hereto, provided that the Borrower may not assign or
transfer any of its rights or obligations under any of the Loan Documents. 

        (b)   Each
Bank may sell participations to one or more banks or other financial institutions (each, a "Participant") in all or
a portion of such Bank's rights and obligations under this Agreement and the other Loan Documents, provided that (i) each such participation in
less than all of such Bank's rights and obligations shall be in a minimum amount of $5,000,000, (ii) each Participant shall meet each of the requirements of an Eligible Assignee (other than the
consent of the Borrower, which shall not be required if such participant is an affiliate of such Bank at the time of such sale or participation), (iii) any such sale or participation shall not
affect the rights and duties of the selling Bank hereunder to the Borrower, and (iv) the only rights granted to the Participant pursuant to such participation arrangements with respect to
waivers, amendments or modifications of the Loan Documents shall be the rights to approve waivers, amendments or modifications that would reduce the principal of or the interest rate on any Loans,
extend the term or increase the amount of the Commitment of such Bank as it relates to such participant, reduce the amount of any commitment fees to which such participant is entitled or extend any
regularly scheduled payment date for principal or interest. In the event of any such grant by a Bank of a participating interest to a Participant, such Bank shall remain responsible for the
performance of its obligations hereunder, and the Borrower and the Administrative Agent shall continue to deal solely and directly with such Bank in connection with such Bank's rights and obligations
under this Agreement as if such transaction had not occurred (except as expressly provided in the immediately succeeding sentence). The Borrower agrees that each Participant shall be entitled to the
benefits of Sections 2.11 and 2.12 with respect to its participating interest to the extent that the Bank from which such Participant obtained its interest would be entitled to payments thereunder, it
being understood that under no circumstances whatsoever shall the Borrower be liable for any additional costs or expenses of any kind due to any such participation and that the rights and obligations
of the parties hereto shall remain the same as if no participation occurred. An assignment or other transfer which is not permitted by subsection (e) below shall be given effect for purposes of
this Agreement only to the extent of a participating interest granted in accordance with this subsection (b). 

        (c)   Except
as provided herein, each Bank may assign all or a portion of its interests, rights and obligations under this Agreement (including all or a portion of its
Percentage and Commitment and the same portion of the Loans at the time owing to it and the Notes held by it) to (A) (i) its parent company and/or any affiliate of such Bank which is at least
50% owned by such Bank or its parent company, (ii) one or more Banks or (iii) in the case of any Bank that is a fund that invests in bank loans, any other fund that invests in bank loans
and is managed or advised by the same investment advisor of such Bank or by an Affiliate of such investment advisor or (B) one or more Eligible Assignees,  provided that any such assignment pursuant
to preceding clause (B) above shall be subject to the satisfaction of the following conditions:
(i) each of the Administrative Agent and the Parent shall have given its prior written consent to such assignment (provided that, in the case of
(x) the Administrative Agent, such consent will not be unreasonably withheld, conditioned or delayed and (y) the Parent, such consent will not be unreasonably withheld, conditioned or
delayed and shall not be required if an Incipient Default or Event of Default shall have occurred and be continuing), (ii) each such assignment shall be of a constant, and not a varying,
percentage of all the assigning Bank's rights and obligations under this Agreement, (iii) each assignment of less than all of such Bank's interests, rights and obligations shall be in an amount
that is at least $                        and is a whole multiple of $1,000,000, and (iv) the parties to such assignment
shall execute and deliver to the Administrative 

58

 

Agent,
for recording in the Register, an Assignment and Acceptance Agreement, together with any Notes subject to such assignment. Upon such execution, delivery, acceptance and recording, from and
after the effective date specified in each Assignment and Acceptance Agreement, which effective date shall be at least five (5) Business Days after the execution thereof (except in the case of
any Assignment and Acceptance Agreement executed in accordance with Section 11.12 which shall be of immediate effect), (x) the assignee thereunder shall be a party hereto and, to the
extent provided in such Assignment and Acceptance Agreement, have the rights and obligations of a Bank hereunder, and (y) the assigning Bank shall, to the extent provided in such assignment and
upon payment to the Administrative Agent of the registration fee referred to in subsection (d) below, be released from its obligations under this Agreement. 

        (d)   The
Administrative Agent shall maintain a copy of each Assignment and Acceptance Agreement delivered to it and a register or similar list (the
"Register") for the recordation of the names and addresses of the Banks and the Percentage of, and principal amount of the Loans owing to the Banks from
time to time. The entries in the Register shall be conclusive, in the absence of manifest error, and the Borrower, the Administrative Agent and the Banks may treat each Person whose name is recorded
in the Register as a Bank hereunder for all purposes of this Agreement. The Register shall be available for inspection by the Borrower and the Banks at any reasonable time and from time to time upon
reasonable prior notice. Upon each such recordation, the assigning Bank agrees to pay to the Administrative Agent a registration fee in the sum of $3,500. 

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

        (f)    Any
assigning Bank shall retain its rights to be indemnified pursuant to Section 12.01 with respect to any claims or actions arising prior to the date of such
assignment. If any assignee Bank is not a United States Person (as such term is defined in Section 770(a)(30)) of the Code for United States federal income tax purposes, it shall, prior to the
date on which any interest or fees are payable hereunder or under any of the other Loan Documents for its account, deliver to the Borrower and the Administrative Agent certification as to its
exemption from deduction or withholding of any United States federal income taxes as described in section 4.04(b). To the extent that an assignment of all or any portion of a Bank's Commitments
and related Outstanding Obligations pursuant to Section 12.04(c) would, at the time of such assignment, result in additional amounts under Section 4.04 from those being charged by the
respective assigning Bank prior to such assignment, then the Borrower shall not be obligated to pay such additional amounts (although the Borrower shall be obligated to pay any other additional amount
or increased cost resulting from changes after the date of the respective assignment as provided herein). Anything contained in this Section 12.04 to the contrary 

59

 

notwithstanding,
any Bank may at any time pledge all or any portion of its interest and rights under this Agreement (including all or any portion of its Notes) to any of the twelve Federal Reserve
Banks organized under Section 4 of the Federal Reserve Act, 12 U.S.C. 341, provided that no such pledge or enforcement thereof shall release the
pledgor Bank from its obligations hereunder or under any of the other Loan Documents. 

        (g)   Wachovia
Capital Markets, LLC shall act as the exclusive arranger, advisor and manager (the "Sole Lead Arranger") and
sole book manager ("Sole Book Manager") in connection with the assignment, transfer and/or participation of the Loans and shall manage all aspects of
any assignment, transfer and participation of the Loans, including, without limitation, the timing of any assignment, transfer or participation, and the final allocations among the Banks. Borrower
acknowledges and agrees that the Sole Lead Arranger and Sole Book Manager, or any Bank, may disclose to any prospective or actual assignee, transferee or Participant financial and other information
regarding the Borrower, the Partners, any Parents and the transactions contemplated by the Borrower, including, but not limited to, financial projections related to the foregoing, and the Borrower
agrees to cooperate with the Sole Lead Arranger, the Sole Book Manager and the Banks in providing any such information to such prospective or actual assignee, transferee or Participant in order to
facilitate the transfer, assignment or participation of any Bank's interest in the Loans and/or the Loan Documents. The Borrower also agrees to provide any further assistance that the Sole Lead
Arranger or Sole Book Manager may reasonably request, which assistance may include, without limitation, (A) direct contact by any such prospective or actual assignee, transferee or Participant
with the Borrower's senior officers, representatives and advisors, at such time and at such places as the Sole Lead Arranger or Sole Book Manager may request (provided such places are in or around New
York, New York), and (B) cooperation in the preparation of a "confidential information" memorandum and other marketing materials to be used in connection with any such assignment, transfer or
participation. The Borrower also agrees to reimburse the Sole Lead Arranger and Sole Book Manager for all reasonable out-of-pocket fees and expenses (including, without
limitation, reasonable attorneys' fees and disbursements) in connection with the transfer, assignment or participation of any Bank's interest in the Loans and/or the Loan Documents, provided the
Borrower shall not be responsible for the portion of any fees and expenses which exceed $25,000. None of the Borrower, its Affiliates or its Subsidiaries will be permitted to purchase or accept an
assignment, transfer or participation of any interest in the Loans or the Loan Documents. 

        12.05    No Waiver; Remedies Cumulative.    No failure or delay on the part of the Administrative Agent or any Bank or
the holder of any Note in exercising any right, power or privilege hereunder or under any other Loan Document and no course of dealing among the Borrower and the Administrative Agent or any Bank or
the holder of any Note shall operate as a waiver thereof; nor shall any single or partial exercise of any right, power or privilege hereunder or under any other Loan Document preclude any other or
further exercise thereof or the exercise of any other right, power or privilege hereunder or thereunder. The rights, powers and remedies herein or in any other Loan Document expressly provided are
cumulative and not exclusive of any rights, powers or remedies which the Administrative Agent or any Bank or the holder of any Note would otherwise have. No notice to or demand on the Borrower in any
case shall entitle the Borrower to any other or further notice or demand in similar or other circumstances or constitute a waiver of the rights of the Administrative Agent or any Bank or the holder of
any Note to any other or further action in any circumstances without notice or demand. 

        12.06    Payments Pro Rata; Adjustments.    (a)    Subject to Section 12.17, the Administrative Agent
agrees that promptly after its receipt of each payment (including payments with respect to principal of and interest on the Loans or the Notes) from or on behalf of the Borrower in respect of any
Obligations of the Borrower hereunder, it shall distribute such payment to the Banks pro rata based upon their respective shares, if any, of the
Obligations with respect to which such payment was received. The Administrative Agent shall upon each distribution with respect to principal of and 

60

 

interest
on the Loans or the Notes promptly notify the Borrower of such distribution and each Bank of the amounts distributed to it applicable to principal of, and interest on, the proportionate share
held by the applicable Bank. Each payment to the Administrative Agent under the first sentence of this Section shall constitute a payment by the Borrower to each Bank in the amount of such Bank's
proportionate share of such payment, and any such payment to the Administrative Agent shall not be considered outstanding for any purpose after the date of such payment by the Borrower to the
Administrative Agent without regard to whether or when the Administrative Agent makes distribution thereof as provided above. If any payment received by the Administrative Agent from the Borrower is
insufficient to pay both all accrued interest and all principal then due and owing, the Administrative Agent shall first apply such payment to all outstanding interest until paid in full and shall
then apply the remainder of such payment to all principal then due and owing, and shall distribute the payment to each Bank accordingly. 

        (b)   Each
of the Banks agrees that, if it should receive any amount hereunder (whether by voluntary payment, by realization upon security, by the exercise of the right of
setoff or banker's lien, by counterclaim or cross action, by the enforcement of any right under the Loan Documents, or otherwise), which is applicable to the payment of the principal of, or interest
on the Loans or any fee provided for in Section 3.01, of a sum which with respect to the related sum or sums received by other Banks is in a greater proportion than the total amount of such
Obligation then owed and due to such Bank bears to the total amount of such Obligation then owed and due to all the Banks immediately prior to such receipt, then such Bank receiving such excess
payment shall purchase for cash without recourse or warranty from the other Banks an interest in the Obligations of the Borrower to such Banks in such amount as shall result in a proportional
participation by all the Banks in such amount; provided, however, that if all or any portion of such
excess amount is thereafter recovered from such Bank, such purchase shall be rescinded and the purchase price restored to the extent of such recovery, but without interest. 

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

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

        12.07    Calculations; Computations.    (a)    The financial statements to be furnished to the Banks
pursuant hereto shall in the case of the Borrower, be made and prepared in accordance with Tax Based Accounting Principles. 

61

 

        (b)   All
computations of interest hereunder shall be made on the basis (i) with respect to Eurodollar Rate Loans, of a year of three hundred sixty (360) days
and for the actual number of days (including the first day but excluding the last day) occurring in the period for which such interest is payable, and (ii) with respect to Base Rate Loans, of
the actual number of days elapsed over a year of 365 or 366 days, as applicable. 

        12.08    Governing Law; Submission to Jurisdiction; Venue; Waiver of Jury Trial.    (a)    This Agreement
and the other Loan Documents and the rights and obligations of the parties hereunder and thereunder shall be construed in accordance with and be governed by the law of the State of New York. Any legal
action or proceeding against the Borrower with respect to this Agreement or any other Loan Document to which the Borrower is a party may be brought in the courts of the State of New York or of the
United States for the Southern District of New York, and, by execution and delivery of this Agreement, the Borrower hereby irrevocably accepts for itself and in respect of its property, generally and
unconditionally, the jurisdiction of the aforesaid courts. The Borrower irrevocably consents to the service of process out of any of the aforementioned courts in any such action or proceeding by the
mailing of copies thereof by registered or certified mail, postage prepaid, to the Borrower at its address set forth opposite its signature below, such service to become effective ten (10) days
after such mailing. Nothing herein shall affect the right of the Administrative Agent, any Bank or the holder of any Note to serve process in any other manner permitted by law or to commence legal
proceedings or otherwise proceed against the Borrower in any other jurisdiction. 

        (b)   The
Borrower hereby irrevocably waives any objection which it may now or hereafter have to the laying of venue of any of the aforesaid actions or proceedings arising out
of or in connection with this Agreement or any other Loan Document brought in the courts referred to in clause (a) above and hereby further irrevocably waives and agrees not to plead or claim
in any such court that any such action or proceeding brought in any such court has been brought in an inconvenient forum. 

        (c)   EACH
OF THE PARTIES TO THIS AGREEMENT HEREBY WAIVES ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT OR
ANY OF THE OTHER LOAN DOCUMENTS OR ANY DEALINGS, COURSE OF DEALINGS, COURSE OF CONDUCT BETWEEN THEM, OR ANY STATEMENTS (WHETHER ORAL OR WRITTEN) OR OTHER ACTIONS OF ANY PARTY, RELATING TO THE SUBJECT
MATTER OF THIS LOAN TRANSACTION OR THE LENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED, INCLUDING, WITHOUT LIMITATION, ANY ACTION OF THE ADMINISTRATIVE AGENT OR THE BANKS RELATING TO THE
ADMINISTRATION OF THE LOAN OR THE ENFORCEMENT OF THE LOAN DOCUMENTS, AND NONE OF THE PARTIES HERETO WILL SEEK TO CONSOLIDATE ANY SUCH ACTION WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT BE OR
HAS NOT BEEN WAIVED. EXCEPT AS PROHIBITED BY LAW, THE BORROWER HEREBY WAIVES ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER IN ANY LITIGATION ANY SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES OR
ANY DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL DAMAGES. THE BORROWER CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF THE ADMINISTRATIVE AGENT OR ANY OF THE BANKS HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAN THE ADMINISTRATIVE AGENT OR ANY OF THE BANKS WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER. The scope of this waiver is intended to be
all-encompassing of any and all disputes that may be filed in any court and that relate to the subject matter of this transaction, including without limitation contract claims, tort
claims, breach of duty claims and all other common law and statutory claims. Each party hereto acknowledges that this waiver is a material inducement to enter into a business relationship, that each
has already relied on this waiver in entering into this Agreement, and that each will continue to rely on this waiver in their related future dealings. Each party hereto further warrants and
represents 

62

 

that
it has reviewed this waiver with its legal counsel and that knowingly and voluntarily waives its jury trial rights following consultation with legal counsel. THIS WAIVER IS IRREVOCABLE, MEANING
THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING, AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT OR ANY OF THE OTHER LOAN
DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS MADE HEREUNDER. In the event of litigation, this Agreement may be filed as a written consent to a trial by the court. 

        12.09    Counterparts.    This Agreement may be executed in any number of counterparts and by the different parties
hereto on separate counterparts, each of which when so executed and delivered shall be an original, but all of which shall together constitute one and the same instrument. A set of counterparts
executed by all the parties hereto shall be lodged with the Borrower and the Administrative Agent. 

        12.10    Effectiveness.    This Agreement shall become effective on the date (the "Effective
Date") on which (i) the conditions contained in Section 6 are met to the satisfaction of the Administrative Agent and (ii) the Borrower and each of the
Banks shall have signed a copy hereof (whether the same or different copies) and shall have delivered the same to the Administrative Agent at its Notice Office or, in the case of the Banks, shall have
given to the Administrative Agent telephonic (confirmed in writing), written or telex notice (actually received) at such office that the same has been signed and mailed to it. The Administrative Agent
will give the Borrower and each Bank prompt written notice of the occurrence of the Effective Date. 

        12.11    Headings Descriptive.    The headings of the several sections and subsections of this Agreement are inserted
for convenience only and shall not in any way affect the meaning or construction of any provision of this Agreement. 

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

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

        (i)    with
respect to any Loan, has the effect of (a) extending the final scheduled maturity or the date of any amortization payment, (b) reducing the rate or
extending the time of payment of interest or fees thereon, (c) increasing or reducing the principal amount thereof, or (d) otherwise postponing or forgiving any indebtedness thereunder, 

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

        (iii)  amends,
modifies or waives any provisions of this Section 12.12 or Section 11.05, 12.01, 12.02, 12.04, 12.06 or 12.07(b), 

        (iv)  reduces
the percentage specified in the definition of the Required Banks or otherwise changes the number or percentage of Banks or Commitments required to take (or not
to take) any action hereunder, 

        (v)   except
as otherwise provided in the Agreement, changes the amount of any Bank's Commitment or Percentage (it being understood that a waiver of any Event of Default or an 

63

 

Incipient
Default or of a mandatory reduction in the Total Commitment shall not constitute a change in the terms of any Commitment of any Bank), 

        (vi)  releases
or waives any Borrower from any of its Obligations hereunder or under the other Loan Documents or releases or waives any guaranty of the Obligations or
indemnifications provided in the Loan Documents, or 

        (vii) consent
to the assignment or transfer by the Borrower of any of its rights and obligations under this Agreement or the other Loan Documents; 

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

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

"THIS
COMMUNICATION REQUIRES IMMEDIATE RESPONSE. FAILURE TO RESPOND WITHIN FOURTEEN (14) CALENDAR DAYS FROM THE RECEIPT OF THIS COMMUNICATION SHALL CONSTITUTE A DEEMED APPROVAL BY THE ADDRESSEE
OF THE ACTION REQUESTED BY THE BORROWER OR THE COURSE OF CONDUCT PROPOSED BY THE ADMINISTRATIVE AGENT AND RECITED ABOVE," 

and
if the foregoing legend is included by the Administrative Agent in its communication, a Bank shall be deemed to have approved or consented to such action or course of conduct for all purposes
hereunder if such Bank fails to object to such action or course of conduct by written notice to the Administrative Agent within fourteen (14) calendar days of such Bank's receipt of such
notice. 

        12.13    Survival.    All indemnities set forth herein including, without limitation, in Sections 2.11, 2.12, 4.04,
11.08 and 12.01 shall survive the execution and delivery of Agreement and the Notes and the making and repayment of the Loans. 

        12.14    Domicile of Loans.    Each Bank may transfer and carry its Loans at, to or for the account of any office,
Subsidiary or Affiliate of such Bank. 

64

   
        12.15    Audits of Borrowing Certificates.    The Administrative Agent shall have the right at any time and from
time
to time to audit any Borrowing Certificate delivered to the Administrative Agent pursuant to this Agreement. Each such audit shall be at the cost and expense of (x) in the event such audit
confirms the accuracy of the respective Borrowing Certificate, the Banks or (y) in the event such audit reveals any discrepancy in such Borrowing Certificate (other than any de minimus
discrepancies), the Borrower. 

        12.16    Defaulting Banks.    (a)    Notwithstanding anything to the contrary set forth in this Agreement,
upon the occurrence of a Bank Default, then, in addition to the rights and remedies that may be available to the Administrative Agent, other Banks, the Borrower or any other party at law or in equity,
and without limitation thereof, (i) such Defaulting Bank's right to participate in the administration of, or decision-making rights related to, the Loans, this Agreement or the other Loan
Documents shall be suspended during the pendency of such Bank Default, and (ii) a Defaulting Bank shall be deemed to have assigned any and all payments due to it from the Borrower, whether on
account of outstanding Loans, interest, fees or otherwise, to the remaining Non-Defaulting Banks for application to, and reduction of, their proportionate shares of all outstanding Loans
until, as a result of application of such assigned payments the Banks' respective pro rata shares of all outstanding Loans shall have returned to those
in effect immediately prior to such delinquency and without giving effect to the nonpayment causing such Bank Default. The Defaulting Bank's decision-making and participation rights and rights to
payments as set forth in clauses (i) and (ii) hereinabove shall be restored only upon the payment by the Defaulting Bank to the Administrative Agent of its pro
rata share of any Loans or expenses as to which it is delinquent, together with interest thereon at the Default Rate from the date when originally due until the date upon which
any such amounts are actually paid. 

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

        12.17    Confidentiality.    The Administrative Agent, each Borrower and the Banks hereby acknowledge and agree that
all information regarding the terms set forth in any of the Loan Documents or the transactions contemplated thereby (the "Confidential Terms") shall be kept confidential and shall not be divulged to
any party without the prior written consent of such other party except to the extent that (i) it is necessary to do so in working with legal counsel, auditors, taxing authorities or other
governmental agencies or regulatory bodies or in order to comply with any applicable federal or state laws including, without limitation, federal securities laws applicable to any Borrower or any
Affiliate thereof, (ii) any of the Confidential Terms are in the public domain other than due to a breach of this covenant, or (iii) in the event of an Incipient Default or an Event of
Default the Banks determine such information to be necessary or desirable to disclose in connection with enforcing or exercising the Banks' rights hereunder;  provided, that nothing herein shall prevent
any party from disclosing any such information (i) to any other party to this Agreement,
(ii) to any proposed assignee or Participant of any Bank which agrees to comply with the provisions of this 

65

 

Section,
or (iii) to its Affiliates, employees, directors, agents, attorneys, accountants and other professional advisors or other Persons deemed necessary or appropriate in the reasonable
judgment of the disclosing party, in each case who are made aware of and instructed to comply with the provisions of this Section 12.17; and,  provided, further, that no disclosure made with respect to any Loan Document shall include a copy of
such Loan Document to the extent that a summary would suffice in lieu thereof and in the event that it is necessary for a copy of any Loan Document to be disclosed, any specific terms set forth in
such Loan Document with respect to fees, pricing, advance rates and the like shall be redacted therefrom prior to disclosure of such Loan Document. The provisions set forth in this section shall
survive the termination of this Agreement for a period of one year following such termination. 

        12.18    Usury Laws.    All agreements between the Loan Parties, on the one hand, and the Administrative Agent and/or
the Banks, on the other hand, pursuant to this Agreement and the other Loan Documents shall be expressly limited so that in no contingency or event whatsoever, whether by reason of acceleration of the
Obligations or otherwise, shall the amount paid or agreed to be paid to the Administrative Agent and/or the Banks for the use or the forbearance of the Obligations exceed the maximum permissible under
applicable law. As used herein, the term "applicable law" shall mean the law in effect as of the date hereof, provided,  however, that in the event there is
a change in the law which results in a higher permissible rate of interest, then this Agreement and the other Loan
Documents shall be governed by such new law as of its effective date. In this regard, it is expressly agreed that it is the intent of the parties hereto in the execution, delivery and acceptance of
this Agreement and the other Loan Documents to contract in strict compliance with the laws of the State of New York from time to time in effect. If, under or from any circumstances whatsoever,
fulfillment of any provision hereof or of any of the other Loan Documents at the time of performance of such provision shall be due, shall involve transcending the limit of such validity prescribed by
applicable law, then the obligation to be fulfilled shall automatically be reduced to the limits of such validity, and if under or from any circumstances whatsoever the Administrative Agent or the
Banks should ever receive as interest any amount which would exceed the highest lawful rate, such amount which would be excessive interest shall be applied to the reduction of the principal balance of
the Indebtedness evidenced hereby and not to the payment of interest. This provision shall control every other provision of all agreements between the Loan Parties, on the one hand, and the
Administrative Agent and/or the Banks, on the other hand. 

        12.19    Integration.    This Agreement is intended by the parties hereto as the final, complete and exclusive
statement of the transactions evidenced by this Agreement. All prior or contemporaneous promises, agreements and understandings, whether oral or written, are deemed to be superceded by this Agreement,
and no party is relying on any promise, agreement or understanding not set forth in this Agreement. 

        12.20    Joint and Several Liability.    (a)    Each Borrower hereby acknowledges and agrees that such
Borrower shall be jointly and severally liable to the Banks to the maximum extent permitted by applicable law for all representations, warranties, covenants, obligations and indemnities of all of the
Borrowers hereunder. 

        (b)   Each
Borrower hereby agrees that, to the extent another Borrower shall have paid more than its proportionate share of any payment made hereunder, such Borrower shall be
entitled to seek and receive contribution from and against any other Borrower which has not paid its proportionate share of such payment; provided
however that the provisions of this clause shall in no respect limit the obligations and liabilities of any Borrower to the Banks, and, notwithstanding any payment or payments
made by any Borrower (the "paying Borrower") hereunder or any set-off or application of funds of the paying Borrower by the Banks, the
paying Borrower shall not be entitled to be subrogated to any of the rights of the Banks against any other Borrower or any collateral security or guarantee or right of offset held by the Banks, nor
shall the paying Borrower seek or be entitled to seek any contribution or 

66

 

reimbursement
from the other Borrower in respect of payments made by the paying Borrower hereunder, until all amounts owing to the Banks by the Borrowers under the Loan Documents are paid in full. If
any amount shall be paid to the paying Borrower on account of such subrogation rights at any time when all such amounts shall not have been paid in full, such amount shall be held by the paying
Borrower in trust for the Banks, segregated from other funds of the paying Borrower, and shall, forthwith upon receipt by the paying Borrower, be turned over to the Banks in the exact form received by
the paying Borrower (duly indorsed by the paying Borrower to the Banks, if required), to be applied against amounts owing to the Banks by the Borrowers under the Loan Documents, whether matured or
unmatured, in such order as the Banks may determine. 

        (c)   Each
Borrower shall remain obligated under this Section 12.20 notwithstanding that, without any reservation of rights against such Borrower and without notice to
or further assent by such Borrower, any demand by the Banks for payment of any amounts owing to the Banks by any other Borrower under the Loan Documents may be rescinded by the Banks and any the
payment of any such amounts may be continued, and the liability of any other party upon or for any part thereof, or any collateral security or guarantee therefor or right of offset with respect
thereto, may, from time to time, in whole or in part, be renewed, extended, amended, modified, accelerated, compromised, waived, surrendered or released by the Banks, and this Agreement and the other
Loan Documents and any other documents executed and delivered in connection therewith may be amended, modified, supplemented or terminated, in whole or in part, as the Banks may deem advisable from
time to time, and any collateral security, guarantee or right of offset at any time held by the Banks for the payment of amounts owing to the Banks by the Borrowers under the Loan Documents may be
sold, exchanged, waived, surrendered or released. The Banks shall not have any obligation to protect, secure, perfect or insure any Lien at any time held by it as security for amounts owing to the
Banks by the Borrowers under the Loan Documents, or any property subject thereto. When making any demand hereunder against any Borrower, the Banks may, but shall be under no obligation to, make a
similar demand on any other Borrower, and any failure by the Banks to make any such demand or to collect any payments from any other Borrower, or any release of such other Borrower shall not relieve
any Borrower in respect of which a demand or collection is not made or the Borrowers not so released of their obligations or liabilities hereunder, and shall not impair or affect the rights and
remedies, express or implied, or as a matter of law, of the Banks against the Borrowers. For the purposes hereof "demand" shall include the commencement and continuance of any legal proceedings. 

        (d)   Each
Borrower waives any and all notice of the creation, renewal, extension or accrual of any amounts at any time owing to the Banks by any other Borrower under the Loan
Documents and notice of or proof of reliance by the Banks upon such Borrower or acceptance of the obligations of such Borrower under this Section 12.20, and all such amounts, and any of them,
shall conclusively be deemed to have been created, contracted or incurred, or renewed, extended, amended or waived, in reliance upon the obligations of the Borrowers under this Section 12.20;
and all dealings between the Borrowers, on the one hand, and the Banks, on the other hand, likewise shall be conclusively presumed to have been had or consummated in reliance upon the obligations of
the Borrowers under this Section 12.20. Each Borrower waives diligence, presentment, protest, demand for payment and notice of default or nonpayment to or upon such Borrower with respect to any
amounts at any time owing to the Banks by such Borrower under the Loan Documents, other than such notices as are expressly required to be given under this Agreement or any of the other Loan Documents.
Each Borrower understands and agrees that it shall continue to be liable under this Section 12.20 without regard to (a) the validity, regularity or enforceability of any other provision
of this Agreement or any other Loan Document, any amounts at any time owing to the Banks by the Borrowers under the Loan Documents, or any other collateral security therefor or guarantee or right of
offset with respect thereto at any time or from time to time held by the Banks, (b) any defense, set-off or counterclaim (other than a defense of payment or performance) which may
at any time be available to or be asserted by any Borrower against the Banks, or (c) any other circumstance whatsoever (with or without notice to or knowledge of 

67

 

the
Borrower) which constitutes, or might be construed to constitute, an equitable or legal discharge of the Borrower for any amounts owing to the Banks by the Borrower under the Loan Documents, or of
the Borrower under this Agreement, in bankruptcy or in any other instance. When pursuing its rights and remedies hereunder against any Borrower, the Banks may, but shall be under no obligation to,
pursue such rights and remedies as it may have against such Borrower or any other Person or against any collateral security or guarantee related thereto or any right of offset with respect thereto,
and any failure by the Banks to pursue such other rights or remedies or to collect any payments from such Borrower or any such other Person or to realize upon any such collateral security or guarantee
or to exercise any such right of offset, or any release of such Borrower or any such other Person or any such collateral security, guarantee or right of offset, shall not relieve Borrower of any
liability hereunder, and shall not impair or affect the rights and remedies, whether express, implied or available as a matter of law, of the Banks against Borrower. 

        (e)   Anything
herein or in any other Loan Document to the contrary notwithstanding, the maximum liability of any Borrower hereunder in respect of the liabilities of the other
Borrowers under this Agreement and the other Loan Documents shall in no event exceed the amount which can be guaranteed by such Borrower under applicable federal and state laws relating to the
insolvency of debtors. 

        12.21    The Administrative Agent's Appointment as Attorney-in-Fact.
    (a)    Following the occurrence and during the continuance of an Event of Default, each Borrower hereby irrevocably constitutes and appoints the Administrative Agent and any
officer or agent thereof, with full power of substitution, as its true and lawful attorney-in-fact (coupled with an interest) with full irrevocable power and authority in the
place and stead of such Borrower and in the name of such Borrower or in its own name, from time to time in Administrative Agent's discretion,
for the purpose of carrying out the terms of this Agreement, to take any and all appropriate action and to execute any and all documents and instruments which may be reasonably necessary or desirable
to accomplish the purposes of this Agreement, and, without limiting the generality of the foregoing, each Borrower hereby gives Administrative Agent the power and right, on behalf of such Borrower,
without assent by, but with written notice to, such Borrower, to do the following: 

        (i)    in
the name of such Borrower, or in its own name, or otherwise, to take possession of and endorse and collect any checks, drafts, notes, acceptances or other instruments
for the payment of moneys due under any mortgage insurance or with respect to any other Eligible Assets and to file any claim or to take any other action or proceeding in any court of law or equity or
otherwise deemed appropriate by Administrative Agent for the purpose of collecting any and all such moneys due under any such mortgage insurance or with respect to any other Eligible Assets whenever
payable; 

        (ii)   to
pay or discharge taxes and Liens levied or placed on or threatened against the Eligible Assets; 

        (iii)  (A)
to direct any party liable for any payment under any Eligible Assets to make payment of any and all moneys due or to become due thereunder directly to
Administrative Agent or as Administrative Agent shall direct; (B) to ask or demand for, collect, receive payment of and receipt for, any and all moneys, claims and other amounts due or to
become due at any time in respect of or arising out of any Eligible Assets; (C) to sign and endorse any invoices, assignments, verifications, notices and other documents in connection with any
Eligible Assets; (D) to commence and prosecute any suits, actions or proceedings at law or in equity in any court of competent jurisdiction to collect the Eligible Assets or any proceeds
thereof and to enforce any other right in respect of any Eligible Assets; (E) to defend any suit, action or proceeding brought against such Borrower with respect to any Eligible Assets;
(F) to settle, compromise or adjust without such Borrower's consent any suit, action or proceeding described in clause (E) above and, 

68

 

in
connection therewith, to give such discharges or releases as Administrative Agent may deem appropriate; and (G) generally, to sell, transfer, pledge and make any agreement with respect to or
otherwise deal with any Eligible Assets as fully and completely as though Administrative Agent were the absolute owner thereof for all purposes, and to do, at Administrative Agent's option and such
Borrower's expense, at any time, and from time to time, all acts and things which Administrative Agent deems necessary to protect, preserve or realize upon the Eligible Assets and Administrative
Agent's Liens thereon and to effect the intent of this Agreement, all as fully and effectively as such Borrower might do; and 

        (iv)  to
direct the actions of the Custodian with respect to the Eligible Assets under the Custodial Agreement. 

        Each
Borrower hereby ratifies all that said attorneys shall lawfully do or cause to be done by the express terms hereof. This power of attorney is a power coupled with an interest and
shall be irrevocable. 

        12.22    Exculpation of Administrative Agent.    The powers conferred on Administrative Agent hereunder are solely to
protect Administrative Agent's interests in the Eligible Assets and shall not impose any duty upon it to exercise any such powers. Administrative Agent shall be accountable only for amounts that it
actually receives as a result of the exercise of such powers, and neither it nor any of its officers, directors, employees or agents shall be responsible to any Borrower for any act or failure to act
hereunder, except for its or their own gross negligence or willful misconduct. 

69

   
        IN WITNESS WHEREOF, the parties hereto have caused their duly authorized officers to execute and deliver this Agreement as of the date first above written. 

	 	 	BORROWER:
	

 	
 	

GRAMERCY CAPITAL CORP., a Maryland corporation
	

	 	 	 	 	 	 
	 	 	By:	 	 	 	 
	 	 	 	 	

	 	 	 	 	Name:	 	 
	 	 	 	 	Title:	 	 
	Address:	 	 	 	 	 	 
	

[                                      ]

[                                      ]	 	 	 	 	 	 
	

Telephone No.:    [                    ]

Telecopier No.:    [                    ]

Attention:    
[                                         
       ]	 	 	 	 	 	 
	 	 	GKK CAPITAL LP, a
[                                      ] limited

partnership
	

	 	 	 	 	 	 
	 	 	By:	 	 	 	 
	 	 	 	 	

	 	 	 	 	Name:	 	 
	 	 	 	 	Title:	 	 
	Address:	 	 	 	 	 	 
	

[                                      ]

[                                      ]	 	 	 	 	 	 
	

Telephone No.:    [                    ]

Telecopier No.:    [                    ]

Attention:    
[                                         
       ]	 	 	 	 	 	 

70

 

	Address:	 	[                        ], Individually and as

Administrative Agent
	One Wachovia Center

301 South College Street

Charlotte, NC 28288	 	 	 	 	 	 
	

	 	 	 	 	 	 
	 	 	By:	 	 	 	 
	 	 	 	 	

	Telephone No.: (704) 383-4984	 	 	 	Name:	 	 
	Telecopier No.: (704) 715-0066

Attention: William J. Cohane	 	 	 	Title:	 	 

71

 

	Address:	 	WACHOVIA CAPITAL MARKETS, LLC, as Sole Lead Arranger and Sole
	
[                                       ]

[                                       ]
	 	 	 	 	 	 
	 	 	By:	 	 	 	 
	 	 	 	 	

	Telephone No.:    [                    ]	 	 	 	Name:	 	 
	Telecopier No.:    [                    ]

Attention:    
[                                         
        ]	 	 	 	Title:	 	 

72

  

 
 

SCHEDULE I    
    

 
 

STATED COMMITMENT AMOUNTS    
    

	Name of Bank
 
	 	Stated Commitment Amount

	

[                        ]	
 	
$	

25,000,000

I-1

  

 
 

SCHEDULE II
  
    APPLICABLE LENDING OFFICES    
    

	Name of Bank
	 	Base Rate Lending Office
	 	Eurodollar Lending Office

	
[                                         
       ]	 	One Wachovia Center

301 South College Street

16th Floor

Charlotte, NC 28288	 	One Wachovia Center

301 South College Street

16th Floor

Charlotte, NC 28288

II-1

QuickLinks

Exhibit 10.9

CREDIT AGREEMENT among GRAMERCY CAPITAL CORP., and GKK CAPITAL LP, individually and collectively as Borrower, THE FINANCIAL INSTITUTIONS NAMED HEREIN, as Banks, and [ ], as Administrative Agent with WACHOVIA
CAPITAL MARKETS, LLC, as Sole Lead Arranger and Sole Book Manager Dated as of July , 2004

TABLE OF CONTENTS

W I T N E S S E T H

SECTION 1 DEFINITIONS AND PRINCIPLES OF CONSTRUCTION

SECTION 2 AMOUNT AND TERMS OF CREDIT

SECTION 3 FEES

SECTION 4 PREPAYMENTS; PAYMENTS

SECTION 5 SECURITY

SECTION 6 CONDITIONS PRECEDENT

SECTION 7 REPRESENTATIONS, WARRANTIES AND AGREEMENTS

SECTION 8 AFFIRMATIVE COVENANTS

SECTION 9 NEGATIVE COVENANTS

SECTION 10 EVENTS OF DEFAULT

SECTION 11 THE ADMINISTRATIVE AGENT

SECTION 12 MISCELLANEOUS

SCHEDULE I

STATED COMMITMENT AMOUNTS

SCHEDULE II APPLICABLE LENDING OFFICES

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