Document:

Exhibit 10.37

 

NORTHSTAR REALTY FINANCE LIMITED PARTNERSHIP

 

Fifth Amendment to the

Agreement of Limited Partnership of NorthStar Realty Finance Limited
Partnership

 

This Amendment is made as of May 29, 2008, by
NORTHSTAR REALTY FINANCE CORP., a Maryland corporation, as general partner (the
“General Partner”), of NORTHSTAR REALTY FINANCE LIMITED PARTNERSHIP, a
Delaware limited partnership (the “Partnership”), for the purpose of
further amending the Agreement of Limited Partnership of the Partnership dated October 19,
2004, as amended by the First Amendment to the Agreement of Limited
Partnership, dated as of March 14, 2006, the Second Amendment to the
Agreement of Limited Partnership, dated September 14, 2006, the Third
Amendment to the Agreement of Limited Partnership, dated February 7, 2007
and the Fourth Amendment to the Agreement of Limited Partnership, dated May 24,
2007 (as so amended,
the “Partnership Agreement”).  All
capitalized terms used herein and not defined shall have the respective
meanings ascribed to them in the Partnership Agreement.

 

WHEREAS, Section 4.2(a) of the
Agreement grants the General Partner authority to cause the Partnership to
issue additional Partnership Interests in one or more classes or series, with
such designations, rights, powers, preferences and duties as may be determined
by the General Partner in its sole and absolute discretion;

 

WHEREAS, Section 7.3(c) of
the Partnership Agreement permits the General Partner, without the consent of
the Limited Partners, to amend the Partnership Agreement to facilitate the
purpose of issuing additional Partnership Interests in accordance with Section 4.2
of the Partnership Agreement; and

 

WHEREAS, the General Partner desires
by this Amendment to amend the Partnership Agreement as of the date hereof.

 

NOW, THEREFORE, in consideration of the mutual covenants set forth
herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the General Partner hereby amends
the Partnership Agreement as follows:

 

1.                                       Amendments to Partnership Agreement.

 

The General Partner, as general partner of the
Partnership and as attorney-in-fact for its Limited Partners, hereby amends the
Partnership Agreement as follows:

 

 

A.                                   Article I of the Partnership Agreement
is amended by inserting the following definition in alphabetical order:

 

“Book-Up
Target” for each LTIP Unit means the lesser of (i) the
Partnership Common Unit Economic Balance as determined on the date such LTIP
Unit was granted and as reduced (not to less than zero) by allocations of
Liquidating Gains pursuant to Section 6.3(b) and reallocations of
Economic Capital Account Balances to such LTIP Unit as a result of a forfeiture
of an LTIP Unit, as determined by the General Partner and (ii) the amount
required to be allocated to such LTIP Unit for the Economic Capital Account
Balance, to the extent attributable to such LTIP Unit, to be equal to the
Partnership Common Unit Economic Balance. 
Notwithstanding the foregoing, the Book-Up Target shall be equal to zero
for any LTIP Unit for which the Economic Capital Account Balance attributable
to such LTIP Unit has, at any time, reached an amount equal to the Partnership
Common Unit Economic Balance determined as of such time.

 

B.                                     Section 6.3(b) of the Partnership
Agreement is amended by replacing the existing text with the following:

 

(b) Special
Allocations Regarding LTIP Units.

 

(i)                                   In the event that Liquidating Gains or
Liquidating Losses are allocated under this Section 6.3(b), Net Income and
Net Loss shall be recomputed without regard to the Liquidating Gains or
Liquidating Losses so allocated (subject to any prior allocation of Net Income
or Net Loss otherwise provided for).

 

(ii)                                Notwithstanding the provisions of Section 6.2
above, but subject to the prior allocation of income, gain, deduction and loss
under paragraph (a) above and to the terms of any Partnership Unit
Designation in respect of any class of Partnership Interests ranking senior to
the LTIP Units with respect to return of capital or any preferential or
priority return, any Liquidating Gains shall first be allocated to the LTIP
Unitholders until the Economic Capital Account Balances of such LTIP
Unitholders, to the extent attributable to their ownership of LTIP Units, are
equal to (i) the Partnership Common Unit Economic Balance, multiplied by (ii) the
number of their LTIP Units.  Any such
allocations of Liquidating Gain shall be made among the LTIP Unitholders in
proportion to the amounts required to be allocated to each under this Section 6.3(b).

 

(iii)                             Liquidating Gain allocated to an LTIP
Unitholder under this Section 6.3(b) will be attributed to specific
LTIP Units of such LTIP Unitholder for purposes of determining (i) allocations
under this Section 6.3(b), (ii) the effect of the forfeiture or
conversion of specific LTIP Units on such LTIP Unitholder’s Economic Capital
Account Balance and (iii) the ability of such LTIP Unitholder to convert
specific LTIP Units into Common Units. 
Such Liquidating Gain will be attributed to LTIP Units in the 

 

2

 

following order:  (i) first, to vested LTIP Units held for
more than two years, (ii) second, to vested LTIP Units held for two years
or less, (iii) third, to unvested LTIP Units that have remaining vesting
conditions that only require continued employment or service to the Company,
the Partnership or an Affiliate of either for a certain period of time (with
such Liquidating Gains being attributed in order of vesting from soonest
vesting to latest vesting), and (iv) fourth, to other unvested LTIP Units
(with such Liquidating Gains being attributed in order of issuance from
earliest issued to latest issued). 
Within each such category, Liquidating Gain will be allocated serially (i.e.,
entirely to the first unit in the category, then entirely to the next unit in
the category, and so on, until a full allocation is made to the last unit in
the category) in the order of smallest Book-Up Target to largest Book-Up Target
until the Economic Capital Account Balance of such LTIP Unitholder attributable
to such LTIP Unitholder’s ownership of each LTIP Unit in the category is equal
to the Partnership Common Unit Economic Balance;  provided, however, that if there is
not sufficient Liquidating Gain for the Economic Capital Account Balance of
such LTIP Unitholder attributable to such LTIP Unitholder’s ownership of each
LTIP Unit to be equal to the Partnership Common Unit Economic Balance and the
Book-Up Target for any LTIP Unit is less that the amount required to be
allocated to the LTIP Unit for the Economic Capital Account attributable to the
LTIP Unit to equal the Partnership Common Unit Economic Balance, then
Liquidating Gains shall be allocated pursuant to the waterfall set forth in 6.3(b) (iii)(i) –(iv) above
until the Book-Up Target of each such LTIP Unit in each category has been
reduced to zero and, thereafter, any remaining Liquidating Gain shall be
further allocated pursuant to such waterfall until the Economic Capital Account
Balance of an LTIP Unitholder attributable to such LTIP Unitholder’s ownership
of each LTIP Unit in the category is equal to the Partnership Common Unit
Economic Balance.

 

(iv)                            Notwithstanding the provisions of Section 6.2
above, but subject to the prior allocation of income, gain, deduction and loss
under paragraph (a) above and to the terms of any Partnership Unit
Designation in respect of any class of Partnership Interests ranking senior to
the LTIP Units with respect to return of capital or any preferential or
priority return, in the event that, due to distributions with respect to Common
Units in which the LTIP Units do not participate or otherwise, the Economic
Capital Account Balance of any present or former LTIP Unitholder, to the extent
attributable to the LTIP Unitholder’s ownership of LTIP Units, exceeds the
Partnership Common Unit Economic Balance, the amount of such excess shall be
re-allocated to such LTIP Unitholder’s remaining LTIP Units to the same extent
and in the same manner as would apply pursuant to Section 6.3(b)(v) below
in the event of a forfeiture of LTIP Units. 
To the extent such excess may not be re-allocated, Liquidating Losses
shall be allocated to such LTIP Unitholder to the extent necessary to reduce or

 

3

 

eliminate the disparity;
provided, however, that if Liquidating Losses are insufficient to completely
eliminate all such disparities, such losses shall be allocated among the LTIP
Unitholders as reasonably determined by the General Partner.

 

(v)                               If an LTIP Unit Limited Partner forfeits
any LTIP Units to which Liquidating Gain has previously been allocated under
this Section 6.3(b) the Capital Account associated with such
forfeited LTIP Units will be re-allocated to that LTIP Unitholder’s remaining
LTIP Units using a methodology similar to that described in Section 6.3(b)(iii) above
to the extent necessary to cause such LTIP Unitholder’s  Economic Capital Account Balance attributable
to each LTIP Unit to equal the Partnership Common Unit Economic Balance.  To the extent such Liquidating Gains are not
re-allocated in accordance with the forgoing, such Liquidating Gains will be
forfeited and the LTIP Unitholder’s Economic Capital Account Balance will be
reduced accordingly.

 

(vi)                            For this purpose, “Liquidating Gains”
means any net capital gain realized in connection with the actual or
hypothetical sale of all or substantially all of the assets of the Partnership,
including but not limited to net capital gain realized in connection with an
adjustment to the Gross Asset Value of Partnership Assets under paragraph (b) of
the definition of “Gross Asset Value.” 
Similarly, “Liquidating Losses” means any net capital loss
realized in connection with any such event. 
The “Economic Capital Account Balances” of the LTIP Unitholders
will be equal to their Capital Account balances, plus the amount of their
shares of any Partner Minimum Gain or Partnership Minimum Gain, in either case
to the extent attributable to their ownership of LTIP Units.  Similarly, the “Partnership Common Unit
Economic Balance” shall mean (i) the Capital Account balance of the
General Partner, plus the amount of the General Partner’s share of any Partner
Minimum Gain or Partnership Minimum Gain, in either case to the extent
attributable to the General Partner’s ownership of Partnership Common Units and
computed on a hypothetical basis after taking into account all allocations
through the date on which any allocation is made under this Section 6.3(b),
divided by (ii) the number of the General Partner’s Partnership Common
Units.

 

(vii)                         The parties agree that the intent of this
Section 6.3(b) is to make the Capital Account balance associated with
each LTIP Unit economically equivalent to the Capital Account balance
associated with the General Partner’s Partnership Common Units (on a per-unit
basis).

 

2.                                       Continuation of Partnership Agreement.

 

The Partnership Agreement
and this Amendment shall be read together and shall have the same force and
effect as if the provisions of the Partnership Agreement and this 

 

4

 

Amendment were contained in
one document.  Any provisions of the
Partnership Agreement not amended by this Amendment shall remain in full force
and effect as provided in the Partnership Agreement immediately prior to the
date hereof.

 

[Remainder of page intentionally
blank]

 

5

 

IN WITNESS WHEREOF, the
parties hereto have executed this Amendment to the Partnership Agreement as of
the 29th day of May, 2008.

 

 

	
   

  	
  GENERAL PARTNER:

  
	
   

  	
   

  
	
   

  	
  NORTHSTAR REALTY FINANCE
  CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Albert Tylis

  	
   

  
	
   

  	
   

  	
  Name: Albert Tylis

  
	
   

  	
   

  	
  Title: Executive Vice
  President & General Counsel

  

 

6ex10-a.htm

     

    
      

      

    

    
       

      Exhibit
10(a)

      

      
 

    

    
      SHORTFALL,
FEE AND COLLATERAL AGREEMENT

       

       

      among

       

       

      BANK
OF AMERICA, N.A.,

       

       

      as Bridge
Loan Lender, LOC Provider and TOB Liquidity Provider,

       

       

      BANC
OF AMERICA SECURITIES LLC,

       

       

      as TOB
Placement and Remarketing Agent,

       

       

      AMERICA
FIRST TAX EXEMPT INVESTORS, L.P.,

       

       

      as
Obligor

       

       

      and

       

       

      DEUTSCHE
BANK TRUST COMPANY AMERICAS,

       

       

      as
Collateral Agent

       

       

      Dated as
of June 26, 2008

       

      

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      TABLE
OF CONTENTS

       

       

      

       

      ARTICLE
I

       

       

      CERTAIN
DEFINED TERMS

       

      
        	
                SECTION
      1.01.

              	
                Definitions

              	
                2

              
	
                SECTION
      1.02.

              	
                Accounting
      Matters

              	
                7

              
	
                SECTION
      1.03.

              	
                Use
      of Phrases

              	
                7

              
	
                SECTION
      1.04.

              	
                Computation
      of Time Periods

              	
                7

              
	
                SECTION
      1.05.

              	
                Statutory
      References

              	
                7

              

      

       

      ARTICLE
II

       

       

      ISSUANCE
OF LETTERS OF CREDIT; TERM; BRIDGE LOAN

       

      
        	
                SECTION
      2.01.

              	
                Issuance
      of Letters of Credit

              	
                7

              
	
                SECTION
      2.02.

              	
                Term
      of Letters of Credit

              	
                7

              
	
                SECTION
      2.03.

              	
                Bridge
      Loan

              	
                7

              

      

       

      ARTICLE
III

       

       

      ISSUANCE
OF LETTERS OF CREDIT AND TOB LIQUIDITY FACILITIES; REIMBURSEMENT; FEES AND
EXPENSES; OTHER PAYMENTS

       

      
        	
                SECTION
      3.01.

              	
                Letters
      of Credit; Letter of Credit Shortfall Obligations

              	
                8

              
	
                SECTION
      3.02.

              	
                TOB
      Liquidity Shortfall Obligations

              	
                8

              
	
                SECTION
      3.03.

              	
                Letter
      of Credit Fee

              	
                8

              
	
                SECTION
      3.04.

              	
                Remarketing
      and Liquidity Charges

              	
                9

              
	
                SECTION
      3.05.

              	
                Notice
      of Fee Amounts Payable

              	
                9

              
	
                SECTION
      3.06.

              	
                Letter
      of Credit Drawing Fee

              	
                9

              
	
                SECTION
      3.07.

              	
                Waiver
      and Amendment Fee; Courier Fee

              	
                9

              
	
                SECTION
      3.08.

              	
                Interest
      on Obligations

              	
                9

              
	
                SECTION
      3.09.

              	
                Place,
      Time and Manner of Payment; Maximum Interest Rate

              	
                9

              
	
                SECTION
      3.10.

              	
                Obligations
      Unconditional; Preference Amounts.

              	
                9

              
	
                SECTION
      3.11.

              	
                Acquisition
      of Eligible Bonds and Collateral Bonds

              	
                9

              

      

       

      ARTICLE
IV

       

       

      SECURITY;
COLLATERAL AGENT

       

      
        	
                SECTION
      4.01.

              	
                Appointment
      of Collateral Agent; Collateral Agent Fee

              	
                10

              
	
                SECTION
      4.02.

              	
                Security

              	
                10

              
	
                SECTION
      4.03.

              	
                Representations
      and Warranties of the Collateral Agent

              	
                11

              
	
                SECTION
      4.04.

              	
                Collateral
      Agent’s Standard of Care, Liabilities and Indemnity

              	
                11

              
	
                SECTION
      4.05.

              	
                Termination;
      Successor Collateral Agent

              	
                12

              
	
                SECTION
      4.06.

              	
                Duties
      of the Collateral Agent

              	
                12

              
	
                SECTION
      4.07.

              	
                The
      Collateral Agent in Other Capacities

              	
                12

              

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      ARTICLE
V

       

       

      CONDITIONS
PRECEDENT

       

      
        	
                SECTION
      5.01.

              	
                Effective
      Date

              	
                12

              
	
                SECTION
      5.02.

              	
                Documents
      to be Received

              	
                12

              
	
                SECTION
      5.03.

              	
                Additional
      Conditions Precedent for Issuance of Letters of Credit and TOB Liquidity
      Facilities

              	
                13

              
	
                SECTION
      5.04.

              	
                Additional
      Conditions Precedent for Bridge Loan

              	
                14

              
	
                SECTION
      5.05.

              	
                Additional
      Conditions Precedent

              	
                14

              

      

       

      ARTICLE
VI

       

       

      OBLIGATIONS
ABSOLUTE

       

      
        	
                SECTION
      6.01.

              	
                Obligations
      Absolute

              	
                14

              

      

       

      ARTICLE
VII

       

       

      REPRESENTATIONS
AND WARRANTIES OF THE OBLIGOR

       

      
        	
                SECTION
      7.01.

              	
                Organization,
      Powers, Etc

              	
                15

              
	
                SECTION
      7.02.

              	
                Authorization;
      Absence of Conflicts, Etc

              	
                15

              
	
                SECTION
      7.03.

              	
                Binding
      Obligation

              	
                15

              
	
                SECTION
      7.04.

              	
                Governmental
      Approvals

              	
                15

              
	
                SECTION
      7.05.

              	
                Compliance
      with Applicable Law

              	
                15

              
	
                SECTION
      7.06.

              	
                Absence
      of Litigation

              	
                15

              
	
                SECTION
      7.07.

              	
                Absence
      of Defaults

              	
                16

              
	
                SECTION
      7.08.

              	
                Good
      Title

              	
                16

              
	
                SECTION
      7.09.

              	
                Eligible
      Bond Representations

              	
                16

              
	
                SECTION
      7.10.

              	
                Environmental
      Matters

              	
                16

              
	
                SECTION
      7.11.

              	
                Related
      Documents

              	
                16

              

      

      

       

      ARTICLE
VIII

       

       

      COVENANTS

       

      
        	
                SECTION
      8.01.

              	
                Compliance
      with Agreements

              	
                16

              
	
                SECTION
      8.02.

              	
                Compliance
      with Applicable Laws

              	
                16

              
	
                SECTION
      8.03.

              	
                Accounting,
      Reports and Other Information

              	
                16

              
	
                SECTION
      8.04.

              	
                Financial
      Covenants

              	
                16

              
	
                SECTION
      8.05.

              	
                Cap
      on Issuance of TOB Floaters

              	
                16

              
	
                SECTION
      8.06.

              	
                Notice
      of Default

              	
                16

              
	
                SECTION
      8.07.

              	
                Preservation
      of Existence; General Partners

              	
                17

              
	
                SECTION
      8.08.

              	
                Depository
      Relationship

              	
                17

              
	
                SECTION
      8.09.

              	
                Liquidation

              	
                17

              
	
                SECTION
      8.10.

              	
                Merger

              	
                17

              
	
                SECTION
      8.11.

              	
                Liens;
      Collateral

              	
                17

              
	
                SECTION
      8.12.

              	
                Post-Closing
      Covenant

              	
                17

              
	
                SECTION
      8.13.

              	
                Custodian
      Fees

              	
                17

              

      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      ARTICLE
IX

       

       

      EVENTS OF
DEFAULT; ADDITIONAL TERMINATION EVENTS; AND REMEDIES

       

      
        	
                SECTION
      9.01.

              	
                Events
      of Default

              	
                17

              
	
                SECTION
      9.02.

              	
                Additional
      Termination Events

              	
                18

              
	
                SECTION
      9.03.

              	
                Remedies

              	
                18

              

      

       

      ARTICLE
X

       

       

      INDEMNIFICATION;
NATURE OF THE OBLIGOR’S DUTIES; SURVIVAL OF PROVISIONS

       

      
        	
                SECTION
      10.01.

              	
                Indemnification

              	
                19

              
	
                SECTION
      10.02.

              	
                Environmental
      Indemnity; Defense of Claims

              	
                19

              
	
                SECTION
      10.03.

              	
                Survival
      of Provisions

              	
                20

              

      

       

      ARTICLE
XI

       

       

      DISPUTE
RESOLUTION

       

      
        	
                SECTION
      11.01.

              	
                Arbitration

              	
                20

              
	
                SECTION
      11.02.

              	
                Special
      Rules.

              	
                20

              
	
                SECTION
      11.03.

              	
                Reservations
      of Rights

              	
                20

              
	
                SECTION
      11.04.

              	
                Conflicting
      Provisions for Dispute Resolution

              	
                21

              
	
                SECTION
      11.05.

              	
                Jury
      Trial Waiver in Arbitration

              	
                21

              

      

       

      ARTICLE
XII

       

       

      MISCELLANEOUS

       

      
        	
                SECTION
      12.01.

              	
                Waivers,
      Amendments

              	
                21

              
	
                SECTION
      12.02.

              	
                Survival
      of Representations and Warranties

              	
                21

              
	
                SECTION
      12.03.

              	
                Termination
      of Agreement

              	
                21

              
	
                SECTION
      12.04.

              	
                Notices

              	
                21

              
	
                SECTION
      12.05.

              	
                Continuing
      Obligation

              	
                23

              
	
                SECTION
      12.06.

              	
                Satisfaction
      Requirement

              	
                23

              
	
                SECTION
      12.07.

              	
                Governing
      Law

              	
                23

              
	
                SECTION
      12.08.

              	
                Waiver
      of Jury Trial

              	
                23

              
	
                SECTION
      12.09.

              	
                Consent
      to Jurisdiction, Venue and Service of Process

              	
                23

              
	
                SECTION
      12.10.

              	
                Counterparts

              	
                23

              
	
                SECTION
      12.11.

              	
                Complete
      and Controlling Agreement

              	
                24

              
	
                SECTION
      12.12.

              	
                Severability

              	
                24

              
	
                SECTION
      12.13.

              	
                Business
      Days

              	
                24

              
	
                SECTION
      12.14.

              	
                Headings

              	
                24

              
	
                SECTION
      12.15.

              	
                USA
      PATRIOT Act

              	
                24

              
	
                SECTION
      12.16.

              	
                Confidentiality;
      Publicity Releases

              	
                24

              

      

      

      
        	
                 
      

              	
                SCHEDULES:

              

      

      
        	
                SCHEDULE
      I

              	
                Summary
      of Eligible Bonds and Custody
Receipts

              

      

      SCHEDULE
II                                List
of Collateral Bonds

      SCHEDULE
III                                           Collateral
Unenhanced Custody Receipts

      SCHEDULE
IV                                           Specific
Information Regarding Each Enhanced Custody Receipt

      SCHEDULE
V                                Remarketing
and Liquidity Charge Payment Dates

      SCHEDULE
VI                                           Payment
Account Information

      SCHEDULE
VII                                           Additional
Eligible Collateral

      SCHEDULE
VIII Description of the Properties

       

      SCHEDULE
IX    List of Pledged Notes, Recorded Second Lien Properties
and
Additional                        Second
Lien Properties

       

      EXHIBITS:

      EXHIBIT
A                           Copies
of Pledged Notes

      
        
           

        

        
           

          
            

          

        

        
           

        

      

      This
SHORTFALL, FEE AND COLLATERAL
AGREEMENT, dated as of June 26, 2008 (this “Agreement”), is among BANK OF
AMERICA, N.A. (the “Bank”), as Bridge Loan Lender,
LOC Provider (in such capacity, the “LOC Provider”) and as TOB
Liquidity Provider (in such capacity, the “TOB Liquidity Provider”), BANC
OF AMERICA SECURITIES LLC, as TOB Placement and Remarketing Agent (the “TOB Placement and Remarketing
Agent”), AMERICA FIRST TAX-EXEMPT INVESTORS, L.P., a Delaware limited
partnership (the “Obligor”), and DEUTSCHE BANK
TRUST COMPANY AMERICAS, as Collateral Agent (the “Collateral
Agent”).

       

      RECITALS

       

      WHEREAS, the Obligor has
arranged for the delivery into custody of certain tax-exempt bonds owned by the
Obligor (or with respect to certain bonds, participation interests therein) and
the issuance of Unenhanced Custody Receipts (hereinafter defined) evidencing
portions of interests in such bonds or participation interests;

       

      WHEREAS, the Obligor has
requested the LOC Provider to deliver letters of credit to secure the repayment
of such of the Unenhanced Custody Receipts that are intended to be deposited
into Tender Option Bond Trusts (hereinafter defined);

       

      WHEREAS, such Unenhanced
Custody Receipts designated for Tender Option Bond Trust deposit and related
letters of credit will be deposited into custody with an Enhancement Custodian
(hereinafter defined) under an Enhancement Custodial Agreement (hereinafter
defined) pursuant to which the Enhancement Custodian will issue Enhanced Custody
Receipts (hereinafter defined), each evidencing an interest in such designated
Unenhanced Custody Receipt and its related letter of credit;

       

      WHEREAS, the Enhanced Custody
Receipts will be deposited into certain Tender Option Bond Trusts and each
Tender Option Bond Trust will issue floating rate receipts to unrelated
investors and residual receipts to the Obligor;

       

      WHEREAS, the Obligor has
requested the TOB Liquidity Provider to provide a liquidity facility for the
floating rate receipts issued by each Tender Option Bond Trust;

       

      WHEREAS, the Obligor has
requested the TOB Placement and Remarketing Agent to act as remarketing agent
for the floating rate receipts issued by each Tender Option Bond
Trust;

       

      WHEREAS, the Obligor has
requested the Bank to provide bridge financing to enable the Obligor to purchase
the bonds prior to the issuance of any Unenhanced Custody
Receipts,  Enhanced Custody Receipts or receipts to be issued by the
proposed Tender Option Bond Trust, if ratings on the Enhanced Custody Receipts
and receipts to be issued by the proposed Tender Option Bond Trust cannot be
obtained in time to provide funds for such bond purchases by the applicable
deadlines for purchase;

       

      WHEREAS, to induce the LOC
Provider and the TOB Liquidity Provider to execute and deliver such letters of
credit and liquidity facilities, respectively, to induce the TOB Placement and
Remarketing Agent to provide remarketing services, and to induce the Bank to
provide bridge financing, if necessary, the Obligor, among other things, has
agreed to reimburse the LOC Provider for all drawings under each letter of
credit and the TOB Liquidity Provider for all drawings under each liquidity
facility not otherwise immediately reimbursed, to pay to the LOC Provider, the
TOB Liquidity Provider and the TOB Placement and Remarketing Agent certain fees,
to repay any bridge financing that is provided, and to provide security for such
reimbursement and other payment obligations;

       

      WHEREAS, the LOC Provider and
the TOB Liquidity Provider have agreed to issue such letters of credit and
liquidity facilities in accordance with, and subject to the terms and provisions
of, this Agreement, the TOB Placement and Remarketing Agent has agreed to
provide its remarketing services in accordance with, and subject to the terms
and provisions of, each TOB Placement and Remarketing Agreement, and the Bank
has agreed to provide bridge financing if needed; and

       

      WHEREAS, the Bank has
requested the Collateral Agent to act as collateral agent with respect to all
items of Collateral posted by the Obligor hereunder.

       

      NOW, THEREFORE, as consideration
for the mutual promises contained herein and other valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, and intending to be
legally bound hereby, the parties hereto agree as follows:

       

      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

      ARTICLE
I                                

       

      CERTAIN
DEFINED TERMS

       

      SECTION
1.01. Definitions.  The
following terms, as used herein, shall have the following meanings:

       

      “AAA” means
the American Arbitration Association.

       

      “Act of
Bankruptcy” means (a) the filing of a petition in bankruptcy or other
initiation of a bankruptcy proceeding by or against a debtor under the federal
Bankruptcy Code or under any applicable state insolvency code, as now or
hereafter in effect; (b) the entry against a debtor of a decree or order of
a court or agency or supervisory authority having jurisdiction in the premises
for the appointment of a conservator, receiver or liquidator in any insolvency,
readjustment of debt, marshalling of assets and liabilities or similar
proceeding, or for the winding up or liquidation of its affairs; (c) the
appointment of, or the taking of possession by, a receiver, custodian, trustee
or liquidator of the debtor or of a substantial part of its property for
purposes of distributing the debtor’s assets or winding up a debtor’s affairs;
or (d) any of the following actions by a debtor: (i) any formal action
which results in a publicly available written statement of action duly approved
by an authorized committee or governing body of the debtor, as appropriate, that
admits without condition the debtor’s inability to make payments on its debts as
they become due, (ii) any failure to generally pay principal of or interest
on its material obligations as they become due (except as a result of a dispute
regarding such obligations), (iii) a general assignment for the benefit of
creditors, or (iv) the adoption of a resolution or other approval by its
board of directors, executive committee or other governing body for the filing
of an action by the debtor under bankruptcy laws or the appointment of a
receiver, custodian, trustee or liquidator of the debtor for purposes of
distributing the debtor’s assets or the winding up of the debtor’s
affairs.

       

      “Additional
Eligible Collateral ” means cash and securities described and valued as
provided in Schedule VI
attached hereto.

       

      “Additional Second
Lien Mortgage” means an unrecorded second lien mortgage granted by the
Property Owner of each Additional Second Lien Property in favor of the Obligor
to secure repayment of the Pledged Note executed and delivered by such owner in
favor of the Obligor and assigned by the Obligor to the Collateral Agent to
secure the Obligations.

       

      “Additional Second
Lien Property” means each of the three Properties for which an unrecorded
second lien will be delivered on the date of this Agreement, as indicated in
Schedule IX
attached hereto.

       

      “Additional
Termination Event” has
the meaning set forth in Section 9.02 hereof.

       

      “Affiliate”
means any Person directly or indirectly controlling, controlled by or under
common control with the Obligor.  For purposes of this definition, the
term “control” shall mean the direct or indirect ability to determine the
direction of management and policies through ownership, contract or
otherwise.

       

      “Applicable
Law” means all applicable provisions of all constitutions, statutes,
rules, regulations and orders of all governmental bodies, all Governmental
Approvals and all orders, judgments and decrees of all courts and
arbitrators.

       

      “Applicable
Rate” means the Reimbursement Rate until such time as an Event of Default
or Additional Termination Event has occurred hereunder, after which interest
shall accrue on all Obligations outstanding hereunder at the Default
Rate.

       

      “Bankruptcy
Code” means the Bankruptcy Reform Act of 1978, as amended from time to
time, and any Federal law with respect to bankruptcy, insolvency,
reorganization, liquidation, moratorium or similar laws affecting creditors’
rights generally.

       

      “BBA LIBOR”
means the British Bankers Association LIBOR Rate.

       

      “Bond
Documents” means, with respect to any Bond, the Bond Indenture and any
other related documents.

       

      “Bond
Indenture” means, with respect to any Bond, the indenture, trust
agreement or other primary issuance document pursuant to which such Bond was
issued.

       

      “Bond Payment
Drawing” means a drawing on a Letter of Credit to pay any principal or
redemption price of and/or interest on the related Unenhanced Custody
Receipt.

       

      “Bonds”
means, collectively, (a) the Eligible Bonds and (b) the Collateral
Bonds.

       

      “Bond
Trustee” means, with respect to each Bond, the trustee under the Bond
Indenture pursuant to which such Bond was issued, or if there is a participation
interest in any underlying bond, the custodian under the applicable custody
arrangement creating the participation, as the context may require
..

       

      “Bridge
Loan” means a loan in the amount of $65,091,371.66 from
the Bank to the Obligor pursuant to the provisions of this
Agreement.

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

                    
“Bridge
Loan Commitment Fee” means a commitment fee in the amount of $65,091.37 (10 basis points
(0.10%) multiplied by the principal amount of the Bridge Loan).

      

      “Bridge Loan
Maturity Date” means September 26, 2008.

       

      “Bridge Loan Note”
means the promissory note of even date herewith executed and delivered by
the Obligor to the Bank to evidence the Bridge Loan.

       

      “Bridge Loan
Rate” means LIBOR plus 2.25% per annum.

       

      “Business
Day” means any day on which banks or trust companies located in New York,
New York are not required or authorized by law to remain closed or on which the
New York Stock Exchange is not closed.

       

      “Collateral”
means (a) for such period of time as the Bridge Loan is outstanding, all
Eligible Bonds and any related “securities entitlements” (as such term is
defined in the UCC) therein, (b) all Collateral Unenhanced Custody Receipts, (c)
all TOB Residuals, (d) all Collateral Bonds, (e) all Pledged Notes,
(e) all Additional Eligible Collateral delivered by the Obligor pursuant to
Section 4.02(b) hereof, (f) the Recorded Second Lien Mortgages, and (g) the
Additional Second Lien Mortgages.

       

      “Collateral
Bond” means a tax-exempt bond identified in Schedule II
attached hereto.

       

      “Collateral
Unenhanced Custody Receipts” means each Unenhanced Custody Receipt
identified in Schedule
III attached hereto as a “Collateral Unenhanced Custody
Receipt”,  which will not be deposited into custody with the
Enhancement Custodian under the Enhancement Custodial Agreement but will be
Collateral delivered to the Collateral Agent.

       

      “Commitment
Fee” means the commitment fee payable by the Obligor to the Bank pursuant
to the Commitment Letter.

       

      “Commitment
Letter” means the commitment letter from the Bank to the Obligor dated
June 3, 2008 and accepted by the Obligor.

       

      “Collateral Agent
Fee” shall mean a fee equal to $1,000 per annum per Eligible Bond,
Collateral Bond, Collateral Unenhanced Custody Receipt, Pledged Note and TOB
Residual held by the Collateral Agent hereunder.

       

      “Debt Service
Coverage Ratio” means, with respect to each Property, the net operating
income of such Property divided by the total annual debt service payable in
respect of all senior debt outstanding in respect of such Property, whether or
not such debt is secured by a lien on such Property.

       

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

       

      “Default
Rate” means the Reimbursement Rate plus 2.00% per annum.

       

      “Designated
Deposit Unenhanced Custody Receipt” means an Unenhanced Custody Receipt
designated for deposit into the Enhancement Custodial Agreement with a related
Letter of Credit, as set forth on Schedules I and IV
attached hereto.

       

      “Dispute”
means any controversy, claim or dispute between Bank of America and the Obligor,
including any such controversy, claim or dispute arising out of or relating to
(a) this Agreement or (b) the transactions contemplated herein (including
any claim based on or arising from an alleged personal injury or business
tort).

       

      “Eligible
Bond” means a tax-exempt bond or participation interest in a tax-exempt
bond, as applicable, identified in Schedule I
attached to this Agreement.

       

      “Eligible Bond
Payment Date” means the date on which principal, redemption price or
interest is payable on an Eligible Bond in accordance with its
terms.

       

      “Enhanced Custody
Receipt” means an Enhanced Custody Receipt issued by the Enhancement
Custodian on the Letter of Credit Issuance Date to represent an interest in an
Unenhanced Custody Receipt and its related Letter of Credit, as identified on
Schedules I and
IV attached hereto.

       

      “Enhanced Custody
Receipt Mandatory Tender Date” means the date on which any Enhanced
Custody Receipts are subject to mandatory tender pursuant to the provisions of
the Enhancement Custodial Agreement after the occurrence of an Enhanced Custody
Receipt Mandatory Tender Event.

       

      “Enhanced Custody
Receipt Mandatory Tender Drawing” means a drawing on a Letter of Credit
to pay the purchase price of the related Enhanced Custody Receipts upon the
occurrence of an Enhanced  Custody Receipt Mandatory Tender
Event.

       

      “Enhanced Custody
Receipt Mandatory Tender Event” shall have the meaning given to term
“Mandatory Tender Date” in the Enhancement Custodial Agreement.

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

      “Enhanced Custody
Receipt Mandatory Tender Price” shall have the meaning given the term
“Mandatory Tender Price” in the Enhancement Custodial Agreement.

       

      “Enhancement
Custodial Agreement” means the Enhancement Custodial Agreement to be
dated the Letter of Credit Issuance Date between the Bank, as Administrator, and
the Enhancement Custodian.

       

      
               
“Enhancement
Custodian” means Deutsche Bank Trust Company Americas and any substitute
or successor custodian under the Enhancement Custodial
Agreement.

      

       

      “Environmental
Claim” means any complaint, action, notice, order, claim, investigation,
judicial or administrative proceeding or action, or similar claims or
communications from any Person involving or alleging any non-compliance with any
Environmental Requirement or the existence of any unsafe or hazardous condition
resulting from or related to the Release of any Hazardous Material.

       

      “Environmental
Law” means any and all applicable federal, state or local laws, statutes,
ordinances, rules, regulations, orders, principals of common law, judgments,
permits, licenses or other determinations of any judicial or regulatory
authority, now or hereafter in effect, imposing liability, establishing
standards of conduct or otherwise relating to protection of the environment
(including natural resources, surface water, groundwater, soils and indoor and
ambient air), health and safety, land use matters or the presence, generation,
treatment, storage, disposal, Release or threatened Release, transport or
handling of any Hazardous Material.

       

      “Environmental
Requirement” means any Environmental Law, or any other applicable
agreement or restriction (including any condition or requirement imposed by any
third party or insurance or surety company), now or hereafter in effect, which
relates to any matters addressed by any Environmental Law, Hazardous Material or
the prevention of any unsafe or hazardous condition resulting from or related to
the Release of any Hazardous Material.

       

      “Event of
Default” has the meaning set forth in Section 9.01 hereof.

       

      “Fee Payment
Date” means each Letter of Credit Fee Payment Date and each Remarketing
and Liquidity Charge Payment Date.

       

      “Governmental
Approval” means an authorization, permit, consent, approval, license or
exemption from, registration or filing with, or report to, any Governmental or
regulatory unit.

       

      “Hazardous
Material” means any substance, material, element, compound, waste or
chemical, whether solid, liquid or gaseous, which is defined, listed, classified
or otherwise regulated in any way under any Environmental Laws, or any other
such substances or conditions (including mold and other mycotoxins or fungi)
which may create any unsafe or hazardous condition or pose any threat to health
and safety.

       

      “Letter of
Credit” means each letter of credit identified on Schedule I attached
hereto issued by the LOC Provider to the Enhancement Custodian as beneficiary in
the form attached to the Enhancement Custodial Agreement.

       

      “Letter of
Credit Drawing”
means a Bond Payment Drawing or Enhanced Custody Receipt Mandatory Tender
Drawing.

       

      “Letter of Credit
Expiration Date” means initially the date that is 364 days after the
Letter of Credit Issuance Date, as such date may be extended for any particular
Letter of Credit pursuant to Section 2.01(b) hereof.

       

      “Letter of Credit
Fee” means on each applicable Letter of Credit Fee Payment Date with
respect to each Letter of Credit, a fee in an amount equal to 1.35% per annum
multiplied by the sum of the amount available to be drawn under such Letter of
Credit on such Letter of Credit Fee Payment Date plus any amount then subject to
reinstatement in accordance with the provisions of the Letter of
Credit.

       

      “Letter of Credit
Fee Payment Date” means, with respect to each Letter of Credit,
the  Letter of Credit Issuance Date and quarterly thereafter beginning
on the first day of the third calendar month following the Letter of Credit
Issuance Date and on the first day of each third calendar month thereafter (the
exact dates to be included in the Enhancement Custodial Agreement on the Letter
of Credit Issuance Date).

       

      “Letter of Credit
Issuance Date” means the date on which the Letters of Credit are issued
pursuant to this Agreement.

       

      “Letter of Credit
Shortfall Amount” means the amount of a Letter of Credit Drawing honored
by the LOC Provider that is not immediately reimbursed to the LOC Provider by
the Enhancement Custodian.

       

      “LIBOR”
means for any day, a fluctuating rate of interest per annum equal to BBA LIBOR,
as published by Reuters (or other commercially available source providing
quotations of BBA LIBOR as selected by the Bank from time to time) as determined
for each Business Day at approximately 11:00 a.m. London time two (2) London
Banking Days prior to such day, for U.S. Dollar deposits (for delivery on such
day) with a one month term, as adjusted from time to time in the Bank’s sole
discretion for reserve requirements, deposit insurance assessment rates and
other regulatory costs.  If such rate is not available at such time
for any reason, then the rate will be determined by such alternate method as
reasonably selected by the Bank.

       

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

      If the
Bank determines that no adequate basis exists for determining BBA LIBOR or that
BBA LIBOR will not adequately and fairly reflect the cost to the Bank of funding
Letter of Credit Drawings or TOB Liquidity Drawings, or that any Applicable Law
or regulation or compliance therewith by the Bank prohibits or restricts or
makes impossible the charging of interest based on BBA LIBOR and the Bank so
notifies the Obligor, then until the Bank notifies the Obligor that the
circumstances giving rise to such suspension no longer exist, interest shall
accrue and be payable on unreimbursed Obligations from the date the Bank so
notifies the Obligor until all such Obligations have been reimbursed in full
(whether by acceleration, declaration, extension or otherwise) at a fluctuating
rate of interest equal to the Prime Rate plus the basis points that otherwise
would have been added to the LIBOR rate.

       

      “London Banking
Day” means a day on which banks in London are open for business and
dealing in offshore dollars.

       

      
              
“Losses”
means claims, demands, liabilities, damages, losses, costs, charges, taxes and
governmental penalties or charges and expenses (including reasonable attorneys’
fees and expenses) and, solely with respect to the environmental indemnity of
Section 10.02 hereof, including strict liabilities and Environmental
Claims.

      

       

      “Material Adverse
Effect” means, (a)(i) with respect to any Person, a material adverse
effect upon such Person’s business, assets, liabilities, financial condition or
results of operations, and (ii) with respect to a group of Persons as a
whole, a material adverse effect upon such Persons’ businesses, assets,
liabilities, financial conditions or results of operations, taken as a whole,
and (b) with respect to any agreement or obligation, a material adverse
effect upon the binding nature, validity or enforceability of such agreement or
obligation.

       

      “Obligations”
means amounts due and owing by the Obligor to the Bank, the LOC Provider, the
TOB Liquidity Provider and/or the TOB Placement and Remarketing Agent in respect
of the Bridge Loan, Letter of Credit Shortfall Amounts, TOB Liquidity Shortfall
Amounts, accrued and unpaid interest on such amounts, unpaid Letter of Credit
Fees, unpaid Bridge Loan Fee, unpaid Remarketing and Liquidity Charges and any
and all other obligations and liabilities of the Obligor hereunder.

       

      “Person”
includes an individual, association, unincorporated organization, corporation,
partnership, limited partnership, limited liability company, joint venture,
business trust or a government or an agency or political subdivision thereof, or
any other entity.

       

      “Pledged
Notes” means the amended and restated operating loan notes executed and
delivered by the five Property Owners identified on Schedule IX attached
hereto, copies of which notes are attached as Exhibit A
hereto.

       

      “Prime
Rate” means, on any day, the rate of interest per annum then most
recently established by the Bank as its “prime rate.”  Any such rate
is a general reference rate of interest, may not be related to any other rate,
and may not be the lowest or best rate actually charged by the Bank to any
customer or a favored rate and may not correspond with future increases or
decreases in interest rates charged by other lenders or market rates in general,
and that the Bank may make various business or other loans at rates of interest
having no relationship to such rate.  Each time the Prime Rate
changes, the per annum rate of interest on outstanding Obligations shall change
immediately and contemporaneously with such change in the Prime
Rate.  If the Bank ceases to exist or to establish or publish a prime
rate from which the Prime Rate is then determined, the applicable variable rate
from which the Prime Rate is determined thereafter shall be instead the prime
rate reported in The Wall
Street Journal (or the average prime rate if a high and a low prime rate
are therein reported), and the Prime Rate shall change without notice with each
change in such prime rate as of the date such change is reported.

       

      “Property”
means each real property identified on Schedule VIII
attached hereto.

       

      “Property
Owner” means the owner of the fee simple interest in each Property, as
set forth on Schedule
VIII attached hereto.

       

      “Recorded Second
Lien Mortgage” means a recorded second lien mortgage granted by the
Property Owner of each Recorded Second Lien Property in favor of the Obligor to
secure repayment of the Pledged Note executed and delivered by such owner in
favor of the Obligor and assigned by the Obligor to the Collateral Agent to
secure the Obligations.

       

      “Recorded Second
Lien Properties” means each of the two Properties for which a recorded
second lien is indicated in Schedule IX attached
hereto.

       

      “Reimbursement
Rate” means LIBOR plus 2.50% per annum.

       

      “Related
Documents” means the Bridge Loan Note, the Unenhanced Custodial
Agreement, the Enhancement Custodial Agreement, the Letters of Credit, the TOB
Liquidity Facilities, the TOB Placement and Remarketing Agreements, the Eligible
Bonds, the Collateral Bonds, the Collateral Unenhanced Custody Receipts, the
Designated Deposit Unenhanced Custody Receipts, the Pledged Notes, the Recorded
Second Lien Mortgages, the Additional Second Lien Mortgages and all assignments
of any of the foregoing documents to secure the Obligations.

       

      “Release”
means the presence of or any spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, seeping, migrating,
dumping or disposing of any Hazardous Material (including the abandonment or
discarding of barrels, drums, tanks and other similar containers, including any
Hazardous Material) into the indoor or outdoor environment.

       

      “Remarketing and
Liquidity Charges” means all fees payable for each TOB Liquidity Facility
and remarketing services provided by the TOB Placement and Remarketing Agent in
connection with each TOB Trust, calculated at the combined rate of 0.30% per
annum (0.20% for the provision of liquidity and 0.10% for the provision of
remarketing services) and payable in arrears on each Remarketing and Liquidity
Charge Payment Date.

      
        5

        
          

        

      

      
      

      “Remarketing and
Liquidity Charge Payment Date” means the dates on which the Remarketing
and Liquidity Charges are payable by the Obligor, as set forth on Schedule V attached
hereto.

       

       “Shortfall
Amounts” means Letter of Credit Shortfall Amounts and TOB Liquidity
Shortfall Amounts.

      
         

      

      “Tender Option
Bond Trust” or “TOB Trust”
means each of the single bond trusts and pooled trusts identified on Schedule I
attached.

       

      “TOB Floater
Purchase Price” means the “Purchase Price” payable to the holders of TOB
Floaters upon any optional or mandatory tender of such TOB Floaters, as defined
in the applicable TOB Trust Agreement.

       

      “TOB
Floaters” means the floating rate receipts issued by each TOB
Trust.

      
         

      

      “TOB Liquidity
Drawing” means a drawing under a TOB Liquidity Facility to pay the TOB
Floater Purchase Price.

       

      “TOB Liquidity
Facility” means each of the liquidity facilities provided by the TOB
Liquidity Provider to a TOB Trust, as identified on Schedule I attached
hereto.

       

      “TOB Liquidity
Shortfall Amount” means the amount of a TOB Liquidity Drawing honored by
the TOB Liquidity Provider that is not immediately reimbursed to the TOB
Liquidity Provider by the applicable TOB Trustee.

       

      “TOB Placement and
Remarketing Agent” means Banc of America Securities LLC.

       

      “TOB Placement and
Remarketing Agreement” means each Remarketing Agreement to be dated the
Letter of Credit Issuance Date among the TOB Trustee, Bank of America, as
trustor, and the TOB Placement and Remarketing Agent, pursuant to which the TOB
Placement and Remarketing Agent will remarket TOB Floaters tendered for purchase
that are subject to remarketing.

       

      “TOB
Residuals” means the residual receipts issued by each TOB
Trust.

       

      “TOB Trust”
means a trust created by a TOB Trust Agreement on the Letter of Credit Issuance
Date.

       

      “TOB Trust
Documents” means the TOB Trust Agreement, TOB Liquidity Facility and TOB
Placement and Remarketing Agreement executed and delivered in connection with
each TOB Trust.

       

      “TOB Trust
Agreement” means each Trust Agreement to be dated the Letter of Credit
Issuance Date between the Bank, as trustor, and the TOB Trustee, executed and
delivered to create the TOB Trusts identified on Schedule I
attached.

       

      “TOB
Trustee” mean, with respect to any TOB Receipts, Deutsche Bank Trust
Company Americas, as trustee under the related TOB Trust Agreement.

       

      “Trigger
Price” means, with respect to each Eligible Bond, the applicable value
listed under the column marked “Trigger Price” on Schedule I attached
hereto.

       

      “UCC” means
the Uniform Commercial Code as the same may, from time to time, be in effect in
the State of New York; provided, however, in the event that,
by reason of mandatory provisions of law, any or all of the attachment,
perfection or priority of the security interest in any Collateral is governed by
the Uniform Commercial Code as in effect in a jurisdiction other than the State
of New York, the term “UCC” shall mean the Uniform Commercial Code as in effect
in such other jurisdiction for purposes of the provisions hereof relating to
such attachment, perfection of priority and for purposes of definitions related
to such provisions.

       

      “Underlying
Custodian” means Deutsche Bank Trust Company Americas and any substitute
or successor custodian under the Unenhanced Custodial Agreement.

       

      “Unenhanced
Custodial Agreement” means the Unenhanced Custodial Agreement to be dated
the Letter of Credit Issuance Date among the Bank, as Administrator, and the
Underlying Custodian.

       

      “Unenhanced
Custody Receipt” means an Unenhanced  Custody Receipt issued by
the Underlying Custodian to represent an interest in an Eligible
Bond.

       

       “Unrestricted
Liquid Assets” means unrestricted liquid assets (consisting of
unrestricted, unencumbered cash or marketable securities that are not counted
toward any minimum liquidity requirement of any other creditor).

       

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

      SECTION
1.02. Accounting
Matters.  Unless otherwise defined herein, all accounting terms
used herein are used with the meanings ascribed to such terms in accordance with
generally accepted accounting principles.  All computations utilized
by the Bank or by the Obligor in complying with any covenant contained herein
shall, unless there is an express direction to the contrary, be computed on a
basis consistent with generally accepted accounting principles and any
applicable regulations as from time to time in effect.

      
         

      

      SECTION
1.03. Use of
Phrases.  The words “herein,” “hereby,” “hereunder,” “hereof,”
“hereinbefore,” “hereinafter” and other equivalent words refer to this Agreement
as an entirety and not solely to the particular portion thereof in which any
such word is used.  The definitions set forth in Section 1.01 hereof
include both singular and plural.  Whenever used herein, any pronoun
shall be deemed to include both singular and plural and to cover all
genders.

       

      SECTION
1.04. Computation of
Time Periods.  In this Agreement, in the computation of a
period of time from a specified date to a later specified date, the word “from”
means “from and including” and each of the words “to” and “until” means “to but
excluding.”

       

      SECTION
1.05. Statutory
References.  References in this Agreement to any section of the
Uniform Commercial Code or the UCC shall mean, on or after the effective date of
adoption of any revision to the Uniform Commercial Code or the UCC in the
applicable jurisdiction, such revised or successor section thereto.

      
         

      

      ARTICLE
II                                

       

      

       

      ISSUANCE
OF LETTERS OF CREDIT; TERM; BRIDGE LOAN

       

      SECTION
2.01. Issuance of
Letters of Credit.  The LOC Provider agrees to issue the
Letters of Credit on any Business Day on or after the date hereof that all
conditions precedent set forth in Sections 5.02, 5.03 and 5.05 hereof have been
satisfied and the Placement and Remarketing Agent is able to sell the TOB
Floaters, upon the terms and subject to the conditions of this Agreement, and
relying upon the representations and warranties of the Obligor contained herein
..  Each Letter of Credit will be issued in the initial stated amount
indicated on Schedule
I attached hereto.

       

      SECTION
2.02. Term of Letters
of Credit.  Each Letter of Credit shall expire on the
applicable Letter of Credit Expiration Date, unless earlier terminated pursuant
to the terms of this Agreement.  Each original Letter of Credit
Expiration Date may be extended one time for a period of up to 12 months; provided, that (a) no later
than sixty (60) days prior to the initial Letter of Credit Expiration Date the
Obligor has requested the LOC Provider, in writing, to so extend; (b) no
Default or Event of Default or Additional Termination Date has occurred and is
continuing at the time of such request or at the time of the original Letter of
Credit Expiration Date; and (c) such request is accompanied by a firm
written commitment from a third party credit enhancer to provide substitute
credit enhancement that will replace the applicable Letter of Credit within such
extension period.  Any such extension must be documented in writing in
accordance with the provisions of the Letter of Credit.  After any
such substitution, neither the related Enhanced Custody Receipts, nor the
Designated Deposit Unenhanced Custody Receipts nor Eligible Bonds will be
included in the Bank’s Tender Option Bond program, unless the TOB Placement and
Remarketing Agent and the TOB Liquidity Provider for the related TOB Floaters
have given their prior written consent (which consents may be conditioned on fee
adjustments) and any additional requirements for such substitution are met,
including without limitation, consent of the holders of the related TOB
Floaters, mandatory tender of the related TOB Floaters, and/or updated
disclosure with respect to such Enhanced Custody Receipts, Designated Deposit
Unenhanced Custody Receipts and/or Eligible Bonds.

       

      SECTION
2.03. Bridge
Loan.  (a)  In the event that the necessary ratings
on the Enhanced Custody Receipts and TOB Floaters have not been obtained prior
to the date of this Agreement in sufficient time to close the TOB Trusts on the
date of this Agreement, the Bank agrees to make the Bridge Loan to the Obligor,
and the Obligor agrees to borrow the Bridge Loan from the Bank, in a single
advance on the date of this Agreement, subject to the terms and conditions set
forth in this Agreement.  In consideration for the Bank’s approval of
the Bridge Loan, if the Obligor borrows the Bridge Loan the Obligor hereby
agrees to pay to the Bank the Bridge Loan Commitment Fee without notice or
demand, in immediately available funds in advance on the date
hereof.

       

      (b) The
Obligor will use the proceeds of the Bridge Loan solely for the purpose of
paying the purchase price of the Eligible Bonds.  The Bank will
advance Bridge Loan proceeds to be applied to such purposes in accordance with
written instructions from the Obligor.  The Obligor will be
responsible for payment on the date of this Agreement, of the Bridge Loan Fee
and all closing costs associated with the Bridge Loan closing (e.g., title
company charges).

       

      (c) Interest
on the outstanding principal balance of the Bridge Loan shall accrue at the
Bridge Loan Rate and shall be payable in arrears on the first day of each month,
beginning August 1, 2008, and on the date the Bridge Loan is repaid in
full.  The entire principal balance of the Bridge Loan then unpaid,
together with all accrued interest thereon, shall be due and payable in full on
the earlier to occur of (i) the Bridge Loan Maturity Date or (ii) the Letter of
Credit Issuance Date.  The Bridge Loan may be prepaid in whole or in
part at any time without penalty, provided that all conditions for prepayment
set forth in the Bridge Loan Note have been satisfied.  The Bridge
Loan is not a revolving loan; amounts repaid may not be reborrowed.

       

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

      (d) As soon
as practicable after the date of this Agreement that the necessary ratings have
been obtained and the TOB Trusts can be closed, the Obligor hereby authorizes
the LOC Provider, the TOB Liquidity Provider and the TOB Placement and
Remarketing Agent, without any further action or execution or direction by the
Obligor, (i) to finalize and execute all Related Documents not yet executed and
delivered, in substantially the forms reviewed and approved by the Obligor as of
the date of this Agreement, with any such changes as may be required by the
rating agency, to finalize the Related Documents to conform to the provisions of
this Agreement and to eliminate blanks and brackets, so long as copies of any
revisions are provided to the Obligor, (ii) to issue the Letters of Credit and
TOB Liquidity Facilities, (iii) to close all custodial and TOB transactions
contemplated by the Related Documents, (iv) to deliver to the Bond Trustees for
the Eligible Bonds all documentation executed by the Obligor that is necessary
to cause the registered ownership of the Eligible Bonds to be transferred from
the Obligor to the Underlying Custodian, and (v) to apply the proceeds from the
sale of the TOB Floaters and TOB Residuals to repayment in full of the Bridge
Loan and all accrued interest thereon and to payment of the Letter of Credit Fee
payable on the Letter of Credit Issuance Date, to the balance of the Commitment
Fee, and to any additional closing costs (such as rating agency fees) and to
remit the remaining balance to the Obligor.  The Obligor will be
responsible for delivering immediately available funds to the Placement and
Remarketing Agent in payment for the TOB Residuals.

      
 

      

      ARTICLE
III                                

       

      

       

      ISSUANCE
OF LETTERS OF CREDIT AND TOB LIQUIDITY FACILITIES; REIMBURSEMENT; FEES AND
EXPENSES; OTHER PAYMENTS

       

      SECTION
3.01. Letters of
Credit; Letter of Credit Shortfall Obligations.  The LOC Provider
agrees to issue the Letters of Credit at any time up to and including the Bridge
Loan Maturity Date, provided that all conditions for such issuance set forth
herein have been satisfied. The Obligor agrees to reimburse the LOC Provider in
immediately available funds for the amount of each drawing honored by the LOC
Provider under each Letter of Credit and not otherwise immediately reimbursed to
the LOC Provider, together with interest pursuant to Section 3.04 hereof,
as follows:

       

      (a) Pursuant
to the Enhancement Custodial Agreement, the Enhancement Custodian (i) will draw
on each Letter of Credit on each Eligible Bond Payment Date for the amount of
principal, redemption price and/or interest payable in respect of the related
Eligible Bond, (ii) will deliver to the LOC Provider all amounts received
by the Enhancement Custodian in respect of payments on such Eligible Bond, to
reimburse the LOC Provider for the amount of such Bond Payment Drawing, and
(iii) will notify the LOC Provider and the Obligor of the amount of any
shortfall in the event the Enhancement Custodian has not received sufficient
funds to provide for reimbursement to the LOC Provider in full for such Bond
Payment Drawing.  In the event that the LOC Provider is not reimbursed
in full by the Enhancement Custodian for any such Bond Payment Drawing on the
date of such drawing, the Obligor will reimburse the LOC Provider, without any
requirement of notice or demand by the LOC Provider, for the Letter of Credit
Shortfall Amount.

       

      (b) Pursuant
to the Enhancement Custodial Agreement, on each Enhanced Custody Receipt
Mandatory Tender Date the Enhancement Custodian (i) will draw on each related
Letter of Credit for the amount of the Enhanced Custody Receipt Mandatory Tender
Price payable in respect of the Enhanced Custody Receipts subject to mandatory
tender, (ii) will deliver to the LOC Provider all amounts received by the
Enhancement Custodian in respect of the liquidation or distribution of the
related Eligible Bonds, to reimburse the LOC Provider for the amount of the
Enhanced Custody Receipt Mandatory Tender Drawing, and (iii) will notify the LOC
Provider and the Obligor of the amount of any shortfall in the event the
Enhancement Custodian has not received sufficient funds to provide for
reimbursement in full of such Enhanced Custody Receipt Mandatory Tender
Drawing.  In the event that the LOC Provider is not reimbursed in full
by the Enhancement Custodian for any such Enhanced Custody Receipt Mandatory
Tender Drawing on the date of such drawing, the Obligor will reimburse the LOC
Provider, without any requirement of notice or demand by the LOC Provider, for
the Letter of Credit Shortfall Amount.

       

      SECTION
3.02. TOB Liquidity
Shortfall Obligations. The TOB Liquidity Provider agrees to issue
the TOB Liquidity Facilities at any time up to and including the Bridge Loan
Maturity Date, provided that all conditions for such issuance set forth herein
have been satisfied.  Under each TOB Trust Agreement, the TOB Floaters
are subject to optional and mandatory tender under certain circumstances
provided therein.  Each TOB Trust Agreement provides that the TOB
Trustee (a) will draw on the applicable TOB Liquidity Facility for such TOB
Trust to pay the TOB Floater Purchase Price payable to the tendering holders of
TOB Floaters to the extent that remarketing proceeds are not available to pay
such TOB Floater Purchase Price, (b) will deliver to the TOB Liquidity Provider
all amounts received by the TOB Trustee in respect of proceeds from the
liquidation or distribution of the Enhanced Custody Receipts upon any final
tender of the TOB Floaters, and (c) will notify the TOB Liquidity Provider and
the Obligor of the amount of any shortfall in the event the TOB Trustee has not
received sufficient funds to provide for reimbursement in full of such TOB
Liquidity Drawing on the date of such drawing.  In the event that the
TOB Liquidity Provider is not reimbursed in full by the TOB Trustee for any such
TOB Liquidity Drawing on the date of such drawing, the Obligor will reimburse
the TOB Liquidity Provider, without any requirement of notice or demand by the
TOB Liquidity Provider, for the TOB Liquidity Shortfall Amount.

       

      SECTION
3.03. Letter of Credit
Fee.  The Obligor hereby agrees to pay to the LOC Provider the
Letter of Credit Fee payable with respect to each Letter of Credit, without
notice or demand, in immediately available funds in advance on the Letter of
Credit Issuance Date and quarterly thereafter on each applicable Letter of
Credit Fee Payment Date.  The Letter of Credit Fee shall be fully
earned when due and nonrefundable when paid, with respect to the commitment of
the LOC Provider under each Letter of Credit.

       

      
        
          
          

        

        
          8

          
            

          

        

        
          
          

        

      

      SECTION
3.04. Remarketing and
Liquidity Charges.  The Obligor hereby agrees to pay to the TOB
Placement and Remarketing Agent, without notice or demand, the portion of the
Remarketing and Liquidity Charges relating to provision of remarketing services,
and hereby agrees to pay to the TOB Liquidity Provider, without notice or
demand, the portion of the Remarketing and Liquidity Charges relating to
provision of the TOB Liquidity Facilities in each case in immediately available
funds in arrears on each applicable Remarketing and Liquidity Charge Payment
Date.  The Remarketing and Liquidity Charges shall be fully earned
when due and nonrefundable when paid, with respect to the commitment of the TOB
Liquidity Provider under each TOB Liquidity Facility and the services of the TOB
Placement and Remarketing Agent under each TOB Placement and Remarketing
Agreement.

      
         

      

      SECTION
3.05. Notice of Fee
Amounts Payable.  The Bank will endeavor to provide written
notice to the Obligor, at least fifteen (15) Business Days prior to each Fee
Payment Date, of the amount of the Letter of Credit Fee and/or Remarketing and
Liquidity Charges payable on such Fee Payment Date; provided, however, that the Letter of
Credit Fee and the Remarketing and Liquidity Charges shall be due and payable on
such Fee Payment Date, notwithstanding any delay or  failure by the
Bank in providing such notice.

       

      SECTION
3.06. Letter of
Credit Drawing
Fee.  The Obligor agrees to pay to the LOC Provider a Letter of
Credit drawing fee of $250, without notice or demand by the LOC Provider, on
each day on which a Drawing is honored by the LOC Provider under each Letter of
Credit.

      
         

      

      SECTION
3.07. Waiver and
Amendment Fee; Courier Fee.  (a)  Upon each waiver
and any amendment relating to the Bridge Loan, any Letter of Credit, any TOB
Liquidity Facility or this Agreement, the Obligor agrees to pay to the Bank the
sum of $250 plus the Bank’s reasonable costs and expenses (including legal fees)
associated with such waiver or amendment (and interest on such costs and
expenses from the date expended by the Bank to the date reimbursed at the
Applicable Rate, payable on the date of such waiver or amendment.

       

      (b) In
connection with any express mailing or similar express delivery required to be
made by the Bank pursuant to this Agreement, the Obligor agrees to reimburse the
Bank upon demand the sum of $45.

       

      SECTION
3.08. Interest on
Obligations.  The Obligor shall pay interest to the Bank, the
LOC Provider, the TOB Liquidity Provider, and the TOB Placement and Remarketing
Agent, as applicable, at the Applicable Rate, compounded daily, on the amount of
each Obligation or other amount due hereunder from the date such Obligation or
other amount becomes owing to the date of reimbursement or payment in full to
the Bank, the LOC Provider, TOB Liquidity Provider or TOB Placement and
Remarketing Agent, as applicable.

       

      SECTION
3.09. Place, Time and
Manner of Payment; Maximum Interest Rate.  All payments by the
Obligor to the Bank, the LOC Provider, the TOB Liquidity Provider and the TOB
Placement and Remarketing Agent under this Agreement shall be made in lawful
currency of the United States and in immediately available funds by federal wire
in accordance with the payment instructions set forth on Schedule VI attached
hereto and shall be made without any set-off, counterclaim or deduction
whatsoever.  The Obligor hereby agrees to pay to the Bank, the LOC
Provider, the TOB Liquidity Provider and the TOB Placement and Remarketing Agent
on demand interest at the Applicable Rate, compounded daily, on any and all
amounts due and unpaid hereunder by the Obligor from the date such amounts
become due until paid in full (after as well as before judgment).  Any
payment received by the Bank, the LOC Provider, the TOB Liquidity Provider or
the TOB Placement and Remarketing Agent after 2:00 p.m. on a Business Day shall
be deemed to have been received by such party on the next succeeding Business
Day for purposes of the immediately preceding sentence and all other
calculations of interest and fees.  Except as otherwise provided
herein, all computations of fees and interest shall be made by the Bank on the
basis of a year of 360 days for the actual number of days elapsed (including the
first day but excluding the last day).  Each determination by the Bank
of an interest rate or of interest or fees payable hereunder shall be conclusive
and binding for all purposes in the absence of manifest error.  In the
event that the date specified for any payment hereunder is not a Business Day,
such payment shall be made not later than the next following Business Day and
interest shall be paid at the rate provided for herein on any such payment to
the Business Day on which such payment is made.  Nothing contained in
this Agreement shall be deemed to establish or require the payment of a rate of
interest in excess of the maximum rate permitted by Applicable Law.

       

      SECTION
3.10. Obligations
Unconditional; Preference Amounts.

       

      (a) The Bank,
the LOC Provider, the TOB Liquidity Provider, the TOB Placement and Remarketing
Agent and the Obligor hereby agree that all Obligations and other liabilities of
the Obligor under this Agreement are and shall be unconditional direct
obligations of the Obligor, with full recourse against the Obligor for the
payment thereof.

       

      (b) Notwithstanding
anything in this Agreement to the contrary, the Obligor’s obligations to the
Bank, the LOC Provider, the TOB Liquidity Provider and the TOB Placement and
Remarketing Agent in respect of Obligations shall be due and payable by the
Obligor or shall be reinstated (as the case may be) if at any time any payment
made to the Bank, the LOC Provider, the TOB Liquidity Provider or the TOB
Placement and Remarketing Agent, in whole or in part, is rescinded or must
otherwise be returned by the Bank, the Enhancement Custodian, the LOC Provider,
the TOB Liquidity Provider or the TOB Placement and Remarketing Agent, as
applicable, upon the insolvency, bankruptcy or reorganization of any underlying
issuer or obligor, the Obligor or otherwise, all as though such payment had not
been made.

       

      SECTION
3.11. Acquisition of
Eligible Bonds and Collateral Bonds.  (a)  On or
prior to the date of this Agreement, the Obligor will acquire the Eligible Bonds
and the Collateral Bonds free of all liens.

       

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

      (b) If the
Letters of Credit and TOB Liquidity Facilities are issued on the date of this
Agreement, the Obligor will (i) deliver to the Underlying Custodian each
Eligible Bond together with an assignment thereof executed by the registered
owner, and provide for registration of the ownership of each such Eligible Bond
in the name of the Underlying Custodian; (ii) deliver to the Collateral Agent
the Collateral Bonds, the Collateral Unenhanced Custody Receipts, the Pledged
Notes and the TOB Residuals, and provide for registration of the pledge of each
of such securities in the name of the Collateral Agent, on behalf of the LOC
Bank, the TOB Liquidity Provider and the TOB Remarketing Agent, as provided in
Article IV hereof.  The deposit price payable for the acquisition of
the Eligible Bonds will be comprised of funds received from either the sale of
the TOB Floaters and TOB Residuals or proceeds of the Bridge
Loan.  All costs payable in respect of the acquisition of the
Collateral Bonds are payable by the Obligor.  As an accommodation to
the Obligor, if the Letters of Credit and TOB Liquidity Facilities are issued on
the date of this Agreement, the TOB Placement and Remarketing Agent has agreed
to deliver directly to Merrill Lynch, as present holder of the Eligible Bonds,
the portion of the deposit price of such Eligible Bonds
that the Placement and Remarketing Agent expects to receive from the sale
of the TOB Floaters.  In the event that the TOB Placement and
Remarketing Agent has delivered such portion of the deposit price and the
transactions contemplated by this Agreement and the Related Documents fail to
close on the date hereof for any reason whatsoever, the Obligor agrees to
purchase such Eligible Bonds from the TOB Placement and Remarketing Agent on the
date hereof for a purchase price equal to the amount so paid by the TOB
Placement and Remarketing Agent.

       

      (c) If the
Bridge Loan is made on the date of this Agreement, then in lieu of the
provisions set forth in paragraph (b) above, the Obligor will:

      
         

      

      (i) on the
date of this Agreement, (A) deliver to the Collateral Agent (1) each Eligible
Bond, and provide for registration of the pledge of each Eligible Bond in the
name of the Collateral Agent, on behalf of the Bank, as provided in Article IV
hereof, and (2) the Collateral Bonds and the Pledged Notes, and provide for
registration of the pledge of each of such securities in the name of the
Collateral Agent, on behalf of the Bank, the LOC Bank, the TOB Liquidity
Provider and the TOB Remarketing Agent, as provided in Article IV hereof, and
(B) execute and deliver into escrow with the Obligor’s counsel all documentation
necessary to transfer the ownership of each Eligible Bond from the Obligor to
the Underlying Custodian as registered owner, with instructions to each Bond
Trustee to provide for registration of each such Eligible Bond in the name of
the Underlying Custodian on the Letter of Credit Issuance Date;

       

      (ii) on the
Letter of Credit Issuance Date, (A) cause each Eligible Bond to be delivered by
the Collateral Agent to the Underlying Custodian, and provide for the transfer
of ownership from the Obligor to the Underlying Custodian and for registration
of the ownership of each such Eligible Bond in the name of the Underlying
Custodian (the Bank and the Custodian to release the Eligible Bonds from the
pledge of this Agreement for such purpose), and (B) deliver or cause to be
delivered to the Collateral Agent the Collateral Unenhanced Custody Receipts and
the TOB Residuals, and provide for registration of the pledge of each of such
securities in the name of the Collateral Agent, on behalf of the LOC Bank, the
TOB Liquidity Provider and the TOB Remarketing Agent, as provided in Article IV
hereof.

       

      ARTICLE
IV

       

       

      SECURITY;
COLLATERAL AGENT

       

      SECTION
4.01. Appointment of
Collateral Agent; Collateral Agent Fee.  (a)  The
Bank and the Obligor hereby appoint the Collateral Agent and the Collateral
Agent hereby agrees to act as Collateral Agent hereunder.  The
Collateral Agent assumes no obligation to review the sufficiency of the
Collateral, or to recommend the purchase, retention or sale of any
Collateral.

       

      (b) The
Obligor hereby agrees to pay to the Collateral Agent the Collateral Agent Fee,
without notice or demand, in immediately available funds in advance on the date
hereof and on the date of each anniversary of the date hereof until the
termination of this Agreement in accordance with its terms.  The
Collateral Agent Fee shall be fully earned when due and nonrefundable when
paid.

       

      SECTION
4.02. Security.  (a)  In
order to secure the prompt and complete payment by the Obligor when due of all
Obligations, (i) the Obligor hereby grants to the Collateral Agent, for the
benefit of the Bank, the LOC Provider, TOB Liquidity Provider and TOB Placement
and Remarketing Agent, a first priority perfected, secured lien on, and assigns
to the Collateral Agent, for the benefit of the Bank, the LOC Provider, TOB
Liquidity Provider and TOB Placement and Remarketing Agent, all right, title and
interest of the Obligor in and to all Collateral and all proceeds thereof,
including all certificates or instruments representing or evidencing such
Collateral, and all principal, interest and payments and distributions of cash
or other property and proceeds from time to time received, receivable or
otherwise distributed in respect of, or in exchange therefor (whether such
proceeds arise before or after the commencement of any proceeding under any
applicable bankruptcy, insolvency or other similar law, by or against the
Obligor) and all powers and rights of the Obligor now or hereafter acquired by
the Obligor, including rights of enforcement, with respect to all Eligible
Bonds, all Collateral Bonds, all Collateral Unenhanced Custody Receipts, all TOB
Residuals and all Pledged Notes.  In addition, the Pledged Notes
executed by the Property Owners of the Recorded Second Lien Properties will be
secured by a Recorded Second Lien Mortgage on the fee simple interest in each of
the Recorded Second Lien Properties, and the Pledged Notes executed by the
Property Owners of the Unrecorded Second Lien Properties will be secured by an
Additional Second Lien Mortgage on the fee simple interest in each of the
Additional Second Lien Properties.

      
        10

        
          

        

      

      
      

      (b) The
market value of each Eligible Bond as of the date of this Agreement, as
determined by the Bank, is set forth on Schedule I attached
to this Agreement.  Each Eligible Bond will be marked to market by the
Bank after the date hereof on a daily basis.  If at any time after the
date hereof and prior to the termination of this Agreement the market value of
any Eligible Bond (as determined by the Bank in its sole discretion) drops below
the applicable Trigger Price, the Obligor must either deliver to the Collateral
Agent Additional Eligible Collateral  or reduce the aggregate
outstanding balance of the Bridge Loan or of Eligible Bonds secured by Letters
of Credit and the aggregate maximum amount to be drawn under the TOB Liquidity
Facilities, as applicable, in an amount satisfactory to the Bank in its sole
discretion.  In addition to other remedies available to the LOC
Provider and the TOB Liquidity Provider,  each of them shall have the
right to cause the mandatory tender of the Enhanced Custody Receipts and the TOB
Floaters, respectively, if the Obligor fails to satisfy the requirements of this
paragraph.  The market value of each Eligible Bond after the date
hereof will be determined by the Bank by reference to the Municipal Market Data
index plus 2.00%, determined without penalty for real estate
performance.  The Bank shall notify the Obligor of any change of
methodology used for determining the market value of Eligible
Bonds.

       

      (c) The
Obligor will not give any consents, approvals, ratifications or waivers with
respect to any Collateral or take any other actions with respect to the
Collateral permitted by the provisions of the Bond Documents or the TOB
Documents without the prior written consent of the Bank.

      
         

      

      (d) On or
prior to the date hereof, the Obligor will deliver to the Collateral Agent all
Collateral required to be delivered as a condition to the issuance and delivery
of the Bridge Loan or the Letters of Credit and the TOB Liquidity Facilities, as
applicable.  In conjunction with the delivery of each item of
Collateral at the time required by this Agreement, the Obligor will direct each
Bond Trustee, Underlying Custodian, TOB Trustee and Property Owner that is the
maker of a Pledged Note to (i) register on its books the lien of the
Collateral Agent with respect to the Eligible Bonds (if the Obligor borrows the
Bridge Loan), the Collateral Bonds, the Collateral Unenhanced Custodial
Receipts, the TOB Residuals and the Pledged Notes, as applicable, (ii) send
to the Collateral Agent and the Bank copies of all distribution reports and
other reports (if any) sent to holders of such Eligible Bonds, Collateral Bonds,
Collateral Unenhanced Custodial Receipts, TOB Residuals or Pledged Notes, as
applicable, and (iii) make all payments or distributions in respect of the
Eligible Bonds (if the Obligor borrows the Bridge Loan), Collateral Bonds,
Collateral Unenhanced Custodial Receipts, TOB Residuals and Pledged Notes
directly to the Collateral Agent.  Prior to an Event of Default or
Additional Termination Event, the Collateral Agent shall remit to the Obligor at
the account specified on Schedule VI
hereto any payment or distribution received by the Collateral Agent from the TOB
Trustee, Underlying Custodian, Bond Trustee or Property Owner issuer of a
Pledged Note in respect of the Eligible Bonds, Collateral Bonds, Collateral
Unenhanced Custody Receipts, TOB Residuals or Pledged Notes upon receipt thereof
by the Collateral Agent.  At any time after the occurrence of an Event
of Default or Additional Termination Event, any such payments or distributions
on the Eligible Bonds, the Collateral Bonds, Collateral Unenhanced Custody
Receipts, Eligible Bond Collateral, TOB Residuals or Pledged Notes shall
(A) constitute “Collateral,” (B) be subject to the lien of the
Collateral Agent hereunder, and (C) be retained by the Collateral Agent on
behalf of the Bank, the LOC Provider, the TOB Liquidity Provider, and the TOB
Placement and Remarketing Agent in satisfaction of any outstanding
Obligations.  At any time after the occurrence of an Event of Default
or Additional Termination Event, the Collateral Agent shall present for payment
any Eligible Bonds, TOB Residual, Collateral Unenhanced Custody Receipt,
Collateral Bond, Pledged Note or other Collateral that must be presented for
payment to the TOB Trustee, Underlying Custodian, Bond Trustee or issuer
thereof, or its agent, as applicable, and apply such proceeds pursuant to
Article IX hereof.

       

      SECTION
4.03. Representations
and Warranties of the Collateral Agent.  The Collateral Agent
represents and warrants to the Bank and the Obligor that on the date hereof
that:

       

      (a) its
execution, delivery and performance of this Agreement are within its powers,
have been and remain duly authorized by all necessary action, corporate or
otherwise, and do not conflict with any provision of any law, regulation, rule,
decree, order, judgment or contractual restriction binding or affecting it or
its property or assets or any provision of its formative documents;
and

       

      (b) this
Agreement has been duly executed and delivered and this Agreement constitutes
its valid and legally binding obligation enforceable against it in accordance
with its terms.

       

      SECTION
4.04. Collateral
Agent’s Standard of Care, Liabilities and
Indemnity.  (a)  The Collateral Agent shall exercise
reasonable care in its custody and preservation of the Collateral and shall be
deemed to have exercised reasonable care if it exercises at least the same
degree of care as it would exercise with respect to a like transaction in which
it alone is interested.

       

      (b) The
Collateral Agent shall not be liable to the Obligor or the Bank for any action
taken or omitted by it hereunder at the direction of the Bank.  The
Collateral Agent shall be liable only for its gross negligence, bad faith or
willful misconduct.

       

      (c) The
Obligor hereby agrees to indemnify the Collateral Agent and hold it harmless
against any and all claims, losses, liabilities, damages or expenses, including
reasonable counsel fees, howsoever arising, from or in connection with this
Agreement or the performance of its duties hereunder; provided, that nothing
contained herein shall require that the Collateral Agent be indemnified by the
Obligor for any such claims, losses, liabilities, damages or expenses arising
from the Collateral Agent’s gross negligence, bad faith or willful misconduct or
arising from the Bank’s negligence, bad faith or willful
misconduct.

       

      (d) The Bank
hereby agrees to indemnify the Collateral Agent and hold it harmless against any
and all claims, losses, liabilities, damages or expenses, including reasonable
counsel fees, howsoever arising, from or in connection with this Agreement or
the performance of its duties hereunder; provided, that such claims,
losses, liabilities, damages or expenses result from Bank’s negligence, bad
faith or willful misconduct.

       

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

      SECTION
4.05. Termination;
Successor Collateral Agent.  (a)  If at any time the
Collateral Agent become incapable of acting or is adjudged a bankrupt or
insolvent, or a receiver of the Collateral Agent or of its property is
appointed, or any public officer takes charge or control of the Collateral Agent
or of its property or affairs for the purpose of rehabilitation, conservation or
liquidation, then the Bank or the Obligor may petition any court of competent
jurisdiction for the removal of the Collateral Agent and the appointment of a
successor Collateral Agent.

       

      (b) If at any
time the Collateral Agent notifies the Bank and the Obligor that the Collateral
Agent elects to resign as Collateral Agent, the Bank shall, within 45 days after
the delivery of the notice of resignation (and also within 45 days of a notice
or removal pursuant to subsection (b) of this Section 4.05), appoint a successor
Collateral Agent, which successor shall be a commercial bank or trust company
having its principal office in the United States of America and having a
combined capital and surplus of at least $50,000,000 or whose obligations
hereunder are guaranteed by a Person whose capital and surplus or net worth is
at least that amount.  If no successor Collateral Agent has been so
appointed within such 45-day period, the Collateral Agent may petition any court
of competent jurisdiction for the appointment of a successor Collateral
Agent.

       

      (c) Notwithstanding
the foregoing, no resignation or removal of the Collateral Agent in accordance
with the provisions hereof shall become effective until a successor Collateral
Agent has accepted its appointment hereunder.

       

      (d) Any
corporation into which the Collateral Agent may be merged or converted or with
which it may be consolidated or any corporation acquiring or otherwise
succeeding to all or substantially all the business of the department or group
that administers this Agreement shall be the successor of the Collateral Agent
hereunder without the execution or filing of any document or any further act on
the part of any of the parties hereto; provided, that such
corporation shall otherwise satisfy the requirements of Section
4.05(b).

      
         

      

      SECTION
4.06. Duties of the
Collateral Agent.  It is understood and agreed that the
Collateral Agent’s duties are solely those set forth herein and that the
Collateral Agent shall have no duty to take any other action unless specifically
agreed to by the Collateral Agent in writing.  Without limiting the
generality of the foregoing, the Collateral Agent shall not be required to
institute, appear in or defend any suit with respect to any Collateral (other
than a suit relating to the failure of the Collateral Agent to perform its
obligations hereunder), unless requested by the Bank in writing and indemnified
to its satisfaction.

       

      SECTION
4.07. Protection of
Collateral.  The Obligor will from time to time execute,
deliver and file all such supplements and amendments hereto and all such
financing statements, continuation statements, instruments of further assurance
and other instruments, and will take such other action necessary or advisable
to:

       

      (i) maintain
or preserve the lien and security interest (and the priority thereof) of this
Agreement or carry out more effectively the purposes hereof,

       

      (ii) perfect,
publish notice of or protect the validity of the lien and security interest made
or to be made by this Agreement;

       

      (iii) enforce
any rights with respect to the Collateral; or

       

      (iv) preserve
and defend title to the Collateral and the rights of the Collateral Agent, the
Bank, the LOC Provider, the TOB Liquidity Provider and the TOB Placement and
Remarketing Agent in such Collateral against the claims of all persons and
parties.

       

      (b) The
Obligor hereby designates the Collateral Agent its agent and attorney-in-fact to
execute any financing statement, continuation statement or other instrument
required to be executed pursuant to this Section 4.07 and hereby authorizes the
Collateral Agent to file in any filing office any financing statement, amendment
to financing statement, or continuation statement required to be executed
pursuant to this Section 4.07.

       

      SECTION
4.08. The Collateral
Agent in Other Capacities.  The Collateral Agent or any of its
subsidiaries or affiliates, acting as principal, may act as agent for, provide
banking and other services to and generally engage in any kind of business with
issuers of securities and money market instruments purchases for the Bank or the
Obligor to the same extent as if the Collateral Agent were not Collateral Agent
hereunder.

       

      ARTICLE
V

      CONDITIONS
PRECEDENT

       

      SECTION
5.01. Effective
Date.  This Agreement shall become effective on the date
hereof, provided that all requirements for closing set forth in the Commitment
Letter have been satisfied in full to the satisfaction of the Bank in its sole
discretion and each of the conditions precedent as set forth in (a) Sections
5.02, (b) either 5.03 or 5.04, and (c) Section 5.05 have been
satisfied.

       

      SECTION
5.02. Documents to be
Received.  As a condition precedent to the effectiveness of
this Agreement, the Bank shall have received each of the following documents,
each dated the date hereof, except as otherwise specified, in form and substance
satisfactory to the Bank (all certificates evidencing Collateral to be delivered
to the Collateral Agent):

       

      (a) this
Agreement, duly executed by the Obligor and the Collateral Agent;

      
        12

        
          

        

      

      
      

      (b) with
respect to the Eligible Bonds, a copy of the Bond Indenture and all offering
documents;

       

      (c) an
original of each Collateral Bond that is in definitive form, and a copy of each
Collateral Bond that is in book-entry form, together with (i) an agreement of
the Bond Trustee (A) to record the pledge of the Collateral Bond in favor of the
Collateral Agent for the benefit of the Bank, the LOC Provider, TOB Liquidity
Provider and the TOB Placement and Remarketing Agent, and (B) to make all
payments on the Collateral Bond to the Collateral Agent; and (ii) with respect
to each Collateral Bond indicated on Schedule II as a
participation interest, the original participation certificate and all
documentation creating such participation;

       

      (d) an
original of each Pledged Note and an agreement by the related Property Owner (i)
not to incur any additional indebtedness (other than additional advances
pursuant to the related Pledged Note) for so long as this Agreement is in
effect, and (ii) to make all payments on the Pledged Note to the Collateral
Agent;

       

      (e) evidence
satisfactory to the Bank of recordation in the applicable recording office of
each Recorded Second Lien Mortgage and an assignment of such Recorded Second
Lien Mortgage from the Obligor to the Bank, and payment by the Obligor of all
related recording charges, title insurance fees and taxes and related charges or
fees;

      
         

      

      (f) each
original executed Additional Second Lien Mortgage and an assignment thereof from
the Obligor to the Bank, each in recordable form;

       

      (g) all
additional documentation deemed by the Bank in its sole discretion to be
necessary for the perfection of all pledges hereunder;

       

      (h) favorable
opinions of counsel to the Obligor and each of the Property Owners of the
Recorded Second Lien Properties, addressed to the Bank, in form and substance
satisfactory to the Bank and its counsel concerning such matters as the Bank and
its counsel may reasonably require;

       

      (i) evidence
that the Obligor has established a depository relationship with the
Bank;

      
         

      

      (j) immediately
available funds for payment of all fees, deposits and other amounts required to
be paid to the Bank pursuant to the Commitment Letter and this
Agreement;

       

      (k) evidence
that the Obligor has paid all amounts payable by the Obligor in respect of the
purchase price of each Eligible Bond and each Collateral Bond, as required by
Section 3.11;

       

      (l) such
other documents, certificates, instruments, opinions, including reliance
letters, approvals (and, if requested by the Bank or its counsel, certified
duplicates of executed copies thereof) or filings with respect to this
Agreement, and including customary closing certificates and legal opinions, in
each case as the Bank or its counsel may reasonably request.

       

      SECTION
5.03. Additional
Conditions Precedent for Issuance of Letters of Credit and TOB Liquidity
Facilities.  As a condition precedent to the issuance of the
Letters of Credit and TOB Liquidity Facilities, the Bank shall have received
each of the following documents, each dated the Letter of Credit Issuance Date,
except as otherwise specified, in form and substance satisfactory to the Bank
(all certificates evidencing Collateral to be delivered to the Collateral
Agent):

       

      (a) Copies of
the certificates representing the Eligible Bonds being delivered to the
Underlying Custodian, together with evidence that such Eligible Bonds have been
transferred to and registered in the name of the Underlying Custodian, and if
Schedule I
indicates that an Eligible Bond
is a participation interest, a copy of the participation certificate and all
documentation creating such participation;

       

      (b) evidence
that the Enhanced Custody Receipts and TOB Floaters have been rated by a major
national rating agency with a rating necessary for the sale of the TOB Floaters,
and confirmation from the Placement and Remarketing Agent that the proposed
Letter of Credit Issuance Date is an acceptable date for closing the TOB
Trusts;

       

      (c) the
Unenhanced Custodial Agreement, in form and substance acceptable to the the LOC
Provider, the TOB Liquidity Provider, and their counsel, duly executed by the
Underlying Custodian, together with a purchase agreement in the form attached to
the Unenhanced Custodial Agreement, executed and delivered by the
Obligor;

       

      (d) all
original Collateral Unenhanced Custody Receipts, together with an agreement of
the Underlying Custodian (i) to record the pledge of the Collateral Unenhanced
Custody Receipts in favor of the Collateral Agent for the benefit of the LOC
Provider, TOB Liquidity Provider and the TOB Placement and Remarketing Agent,
and (ii) to make all payments on the Collateral Unenhanced Custody Receipts to
the Collateral Agent;

       

      
        
          
          

        

        
          13

          
            

          

        

        
          
          

        

      

      (e) the
Enhancement Custodial Agreement, in form and substance acceptable to the LOC
Provider, the TOB Liquidity Provider, and their counsel, duly executed by the
Enhancement Custodian;

       

      (f) the
original of each TOB Residual certificate in definitive form, together with (i)
an agreement of the TOB Trustee (a) to record the pledge of the TOB Residual in
favor of the Collateral Agent for the benefit of the LOC Provider, TOB Liquidity
Provider and the TOB Placement and Remarketing Agent, and (b) to make all
payments on the TOB Residual to the Collateral Agent, and (ii) an executed
Purchaser Letter as required by the TOB Trust Agreement; and

      
         

      

      (g) immediately
available funds for payment of all fees, deposits and other amounts required to
be paid to the LOC Provider, the TOB Liquidity Provider and the TOB Placement
and Remarketing Agent pursuant to the Commitment Letter and this Agreement,
including without limitation any portion of the Commitment Fee remaining
unpaid.

       

      SECTION
5.04. Additional
Conditions Precedent for Bridge Loan.  As a condition precedent
to any advance under the Bridge Loan, the Bank shall have received each of the
following documents, each dated the date of such advance, except as otherwise
specified, in form and substance satisfactory to the Bank (all certificates
evidencing Collateral to be delivered to the Collateral Agent): 

       

      (a) an
original of each Eligible Bond that is in definitive form, and a copy of each
Eligible Bond that is in book-entry form, together with (i) an agreement of the
Bond Trustee (A) to record the pledge of the Eligible Bond in favor of the
Collateral Agent for the benefit of the Bank, and (B) to make all payments on
the Eligible Bond to the Collateral Agent; and (ii) with respect to each
Eligible Bond indicated on Schedule II as a
participation interest, the original participation certificate and all
documentation creating such participation; and

      
         

      

      (b) immediately
available funds for payment of all fees, deposits and other amounts required to
be paid to the Bank pursuant to the Commitment Letter and this Agreement,
including without limitation the Bridge Loan Commitment Fee.

       

      In
addition, if the Obligor borrows the Bridge Loan, on the date of this Agreement
the Obligor will deliver in escrow all documentation necessary to transfer the
ownership of each Eligible Bond from the Obligor to the Underlying Custodian as
registered owner on the Letter of Credit Issuance Date, with instructions to
each Bond Trustee to provide for registration of each such Eligible Bond in the
name of the Underlying Custodian on the Letter of Credit Issuance
Date.  On the Letter of Credit Issuance Date, the Bank will direct the
Collateral Agent to release the Eligible Bonds from the lien of this Agreement,
and Obligor hereby irrevocably (i) authorizes the delivery to the Bond Trustees
of such executed transfer and payment instructions, and (ii) directs the
Collateral Agent to deliver the Eligible Bonds to the Underlying
Custodian.

       

      SECTION
5.05. Additional
Conditions Precedent.  As a condition precedent to each of the
effectiveness of this Agreement, any advance under the Bridge Loan, and any
issuance of the Letters of Credit and TOB Liquidity Facilities, the following
statements shall be true and correct:

       

      (a) the
representations and warranties of the Obligor set forth herein are true and
correct; and

       

      (b) to the
knowledge of the Obligor, no Default or Event of Default or Additional
Termination Event has occurred and is continuing.

       

      ARTICLE
VI                         

       

      OBLIGATIONS
ABSOLUTE

       

      SECTION
6.01. Obligations
Absolute.  The obligations of the Obligor under this Agreement
shall be absolute, unconditional and irrevocable, and shall be paid or performed
strictly in accordance with the terms of this Agreement, under all circumstances
whatsoever, including, without limitation, the following
circumstances:

       

      (a) any lack
of validity or enforceability of any of the Related Documents;

       

      (b) any
amendment or waiver of or any consent to depart from the terms hereof or from
any of the Related Documents;

       

      (c) the
existence of any claim, set-off, defense or other right that the Obligor may
have at any time against the Enhancement Custodian, the Underlying Custodian,
the Bank, the LOC Provider, the TOB Liquidity Provider, the TOB Placement and
Remarketing Agent, the Collateral Agent or any beneficiary of a Letter of Credit
(or any Person for whom any of the above is acting) or any other Person, whether
in connection with this Agreement, any of the Related Documents, any
transactions contemplated hereby or thereby or any unrelated
transaction;

       

      (d) any
statement or any other document presented under any of the Related Documents
proving to be forged, fraudulent, invalid or insufficient in any respect or any
statement therein being untrue or inaccurate in any respect whatsoever, other
than statements and documents provided by the Bank or its
Affiliates;

       

      (e) any
non-application or misapplication by the Enhancement Custodian or otherwise of
the proceeds of a drawing or advance under any Letter of Credit;

      
        14

        
          

        

      

      
      

      (f) any
non-application or misapplication by any TOB Trustee or otherwise of the
proceeds of a liquidity advance under any TOB Liquidity Facility;

       

      (g) any
non-application or misapplication by the Collateral Agent or otherwise of the
Collateral or the proceeds thereof;

       

      (h) any
bankruptcy, insolvency or reorganization of the Enhancement Custodian or the
Underlying Custodian, any TOB Trustee or the Obligor or other proceeding against
the Enhancement Custodian, the Underlying Custodian, any TOB Trustee or the
Obligor pursuant to any law relating to creditors’ rights, and regardless of any
adverse effect which such proceeding might have upon the obligations of the
Enhancement Custodian, the Underlying Custodian, such TOB Trustee or the
Obligor;

      
         

      

      (i) any and
all defenses based on impairment of collateral; and

       

      (j) any other
circumstances or happenings whatsoever, whether or not similar to any of the
foregoing, other than any event caused by, arising out of or otherwise related
to the gross negligence or willful misconduct of the Bank.

       

      The
liability of the Obligor hereunder shall not be discharged except by complete
payment of the amounts due and payable by the Obligor under this
Agreement.  This Agreement shall continue to be effective if the
Obligor merges or consolidates with or into another entity, loses its separate
identity or ceases to exist.

      
         

      

      ARTICLE
VII                                           

       

      

       

      REPRESENTATIONS
AND WARRANTIES OF THE OBLIGOR

       

      To induce
the Bank, the LOC Provider, the TOB Liquidity Provider and the TOB Placement and
Remarketing Agent to enter into this Agreement, to make the Bridge Loan,
to  execute and deliver the Letters of Credit and the TOB Liquidity
Facilities, and to provide placement and remarketing services for the TOB Trust,
as applicable, the Obligor hereby represents and warrants to the Bank, the LOC
Provider, the TOB Liquidity Provider and the TOB Placement and Remarketing Agent
that:

       

      SECTION
7.01. Organization,
Powers, Etc.  The
Obligor is a duly created and validly existing limited partnership organized
under the laws of the State of Delaware, in good standing, with full power and
authority (a) to own its property, (b) to carry on its activities as
now conducted and as contemplated under this Agreement, and (c) to execute,
deliver, perform and secure its obligations under this Agreement in accordance
with its terms.

       

      SECTION
7.02. Authorization;
Absence of Conflicts, Etc.  The execution, delivery and
performance by the Obligor of this Agreement in accordance with its terms,
(a) has been duly authorized by all necessary action on the part of the
Obligor, (b) does not and will not conflict with, or result in a material
violation of, any Applicable Law, (c) does not and will not require any
consent or approval of any creditor of the Obligor or other third party or
conflict with, result in a material violation of, or constitute a material
default under, the Obligor’s formative documents or any agreement or instrument
to which the Obligor is a party or by which it or any of its Property may be
bound, and (d) does not and will not result in or require the creation or
imposition of any lien upon or with respect to any Property now owned or
hereafter acquired by the Obligor pursuant to any other agreement to which the
Obligor is a party.

       

      SECTION
7.03. Binding
Obligation.  This Agreement has been duly executed and
delivered by a duly authorized representative of the Obligor and is a legal,
valid and binding obligation of the Obligor enforceable against it in accordance
with its terms, except to the extent, if any, that the enforceability thereof
may be limited by (a) the effect of any applicable bankruptcy, insolvency,
reorganization, moratorium, debt adjustment or other similar law or enactment
now or hereafter enacted by the state or federal government affecting the
enforcement of creditors’ rights generally, and (b) general principles of
equity (regardless of whether such enforceability is considered in a proceeding
in equity or at law).

       

      SECTION
7.04. Governmental
Approvals.  All Governmental Approvals necessary for the
Obligor to enter into this Agreement and to perform its obligations hereunder
have been obtained and remain in full force and effect and are subject to no
further administrative or judicial review, and no other Governmental Approval is
necessary for the due execution, delivery and performance by the Obligor of this
Agreement.

       

      SECTION
7.05. Compliance with
Applicable Law.  The Obligor is in compliance with all
Applicable Law, including all Governmental Approvals.

       

      SECTION
7.06. Absence of
Litigation.  Except as otherwise disclosed in writing to the
Bank, there is no action, suit, proceeding, inquiry or investigation, at law or
in equity, before or by any court, arbitrator, governmental or other board, body
or official, pending or, to the best knowledge of the Obligor, threatened
against or affecting it or any of its Affiliates, questioning the validity of
any proceeding taken or to be taken by the Obligor in connection with the
execution, delivery and performance by the Obligor of this Agreement or seeking
to prohibit, restrain or enjoin the execution, delivery or performance by the
Obligor of this Agreement, nor, to the best knowledge of the Obligor, is there
any basis therefor, wherein an unfavorable decision, ruling or finding (a) would
adversely affect the validity or enforceability of, or the authority or ability
of the Obligor to perform its obligations under this Agreement, or (b) would
have a Material Adverse Effect on the financial condition of the Obligor or any
of its Affiliates or the results of operation of the Obligor or any of its
Affiliates.

       

      
        
          
          

        

        
          15

          
            

          

        

        
          
          

        

      

      SECTION
7.07. Absence of
Defaults.  Neither the Obligor nor any of its Affiliates is in
default in the performance, observance or fulfillment of any of the obligations,
covenants or conditions contained in any agreement or instrument to which the
Obligor or any of its Affiliates is a party or by which the Obligor or any of
its Affiliates or any of its or their Property is bound or any judgments,
decrees or orders.

       

      SECTION
7.08. Good
Title.  The Obligor has good title to all Collateral free of
any liens (other than the lien of this Agreement), claims and transfer
restrictions.

      
         

      

      SECTION
7.09. Eligible Bond
Representations.  On the date hereof (and if later, on the
Letter of Credit Issuance Date), the Eligible Bonds are genuine and are free and
clear of any lien, pledge, encumbrance or any other security
interest.  Such representation and warranty shall survive the delivery
of the Eligible Bonds and the issuance of the Unenhanced Custody
Receipts.

       

      SECTION
7.10. Environmental
Matters.  The Obligor represents that, to the best of its
knowledge: (a) each Property is free from any and all Hazardous Materials
and there exists no material violation of any Environmental Law; (b) there
is no Environmental Claim directly involving any Property in which compliance
with any Environmental Law is an issue; and (c) nothing further remains to
be done to satisfy in full all requirements of each such Environmental
Law.

       

      SECTION
7.11. Related
Documents.  The Obligor has received and reviewed all of the
Related Documents.

      
         

      

      ARTICLE
VIII                                  

                                                                  COVENANTS

       

      From the
date hereof and until the termination of this Agreement and payment in full of
all amounts payable to the Bank, the LOC Provider, the TOB Liquidity Provider
and the TOB Placement and Remarketing Agent hereunder, the Obligor hereby
covenants and agrees that:

       

      SECTION
8.01. Compliance with
Agreements.  It will observe and perform fully and faithfully
all of its obligations under this Agreement.

       

      SECTION
8.02. Compliance with
Applicable Laws.  It will, and will cause each of its
Affiliates to comply, in all material respects, with all Applicable Laws, such
compliance to include, without limitation, paying and discharging, as the same
may become due and payable, all taxes, assessments and other governmental
charges or levies against or on any of its or their property, as well as claims
of any kind that, if unpaid, might become a lien upon any of its or their
properties; provided,
however, that the
foregoing shall not require the Obligor, any of its Affiliates or any Property
Owner to comply with any such Applicable Law, and any claim thereunder, so long
as (a) the Obligor, such Affiliate or such Property Owner, as applicable,
in good faith shall contest the validity thereof and shall, with respect to the
payment of any such tax, assessment, charge, levy or lien, in accordance with
generally accepted accounting principles and applicable regulations, set aside
and maintain on its books adequate reserves with respect thereto, or
(b) such noncompliance would not have a Material Adverse Effect on the
Obligor’s ability to perform its obligations and liabilities
hereunder.

       

      SECTION
8.03. Accounting,
Reports and Other Information.  (a)  The Obligor must
deliver to the Bank operating statements and rent rolls for each Property on a
semi-annual basis within 60 days after the end of each fiscal year of the
Obligor and each semi-annual quarter of the Obligor (the Bank reserving the
right to require more frequent reporting), as well as any additional financial
information regarding the Properties that the Bank may reasonably request from
time to time.

       

      (b) The
Obligor must deliver to the Bank audited annual financial statements within 180
days after the end of each fiscal year of the Obligor, and quarterly financial
statements within 60 days after the end of each fiscal quarter of the
Obligor.

       

      (c) The
Obligor will furnish to the Bank promptly, from time to time, such additional
information regarding the Properties and the operations, financial condition of
the Obligor as the Bank may reasonably request.

       

      SECTION
8.04. Financial
Covenants.  (a)  While this Agreement is in effect
and until full and complete payment and performance of all of the Obligations,
the Obligor shall:

       

      (i) Not
permit its total liabilities divided by total assets to exceed 70%;
and

       

      (ii) Maintain
Unrestricted Liquid Assets at all times equal to at least $5
million.

       

      (b) In the
event the aggregate Debt Service Coverage Ratio for the Properties (exclusive of
any payments of contingent interest on the applicable Bonds) at any time falls
below 1.10 to 1.00, the Obligor shall reduce the aggregate outstanding balance
of Eligible Bonds secured by Letters of Credit in an amount sufficient to raise
the Debt Service Coverage Ratio to 1.10 or higher.

       

      SECTION
8.05. Cap on Issuance
of TOB Floaters.  Notwithstanding any other terms or provisions
of the TOB Trust Documents, the TOB Floaters shall not be issued in excess of
the maximum dollar amount with respect to each Eligible Bond set forth on Schedule I.

       

      SECTION
8.06. Notice of
Default.  It will notify the LOC Provider, the TOB Liquidity
Provider and the TOB Placement and Remarketing Agent promptly of any Default or
Event of Default of which the Obligor has knowledge, setting forth the details
of such Default or Event of Default and any and all action that the Obligor has
taken or proposes to take with respect thereto.

      
        16

        
          

        

      

      
      

      SECTION
8.07. Preservation of
Existence; General Partners.  It will preserve and maintain its
legal existence, franchises, rights and privileges in the State of
Delaware.  The Obligor will not permit the substitution of any general
partner or other change in its ownership structure without the Bank’s prior
written consent, other than transfers of limited partnership
interests.

       

      SECTION
8.08. Depository
Relationship.  It will maintain its depository relationship
with the Bank.

       

      SECTION
8.09. Liquidation.  It
will not terminate, wind up, liquidate or dissolve its affairs.

      
         

      

      SECTION
8.10. Merger.  It
will not consolidate or merge with or into or transfer substantially all of its
assets to any other Person.

       

      SECTION
8.11. Liens;
Collateral.  (a)  It will not, nor will it permit any
other person to, sell, assign, transfer, exchange, or otherwise dispose of, or
grant any option with respect to, any Collateral, nor will it create, incur or
permit to exist any lien on or with respect to the Collateral, any interest
therein, or any proceeds thereof (other than the lien of this
Agreement).

       

      (b) It will
pay in timely fashion all taxes, assessments or charges of any nature that are
imposed with respect to the Collateral, including without limitation any filing
fees payable in connection with the filing, continuation, amendment or
termination of any related financing statements.  The Obligor will
give notice to the Collateral Agent and the Bank of, and defend the Collateral,
against, (i) any suit, action or proceeding against such Collateral, and
(ii) any lien that may be asserted with respect to any Collateral (other
than the lien of this Agreement).

      
         

      

      SECTION
8.12. Post-Closing
Covenant.  It will provide to First American Title Insurance
Company within sixty (60) days following the date hereof, such instruments,
certificates and other documents as are sufficient to remove any survey
exceptions from the mortgagee title policies insuring the Recorded Second Lien
Mortgages.

       

      SECTION
8.13. Custodian
Fees.  It will pay or cause to be paid all fees payable to the
Enhancement Custodian and the Underlying Custodian pursuant to the Enhancement
Custodial Agreement and the Unenhanced Custodial Agreement.

       

      ARTICLE
IX                                

       

      

       

      EVENTS
OF DEFAULT; ADDITIONAL TERMINATION EVENTS; AND REMEDIES

       

      SECTION
9.01. Events of
Default.  Each of the following events shall constitute an
Event of Default under this Agreement, whatever the reason for such event and
whether it shall be voluntary or involuntary, or within or without the control
of the Obligor, or be effected by operation of law or pursuant to any judgment
or order of any court or any order, rule or regulation of any governmental
body:

       

      (a) the
failure by the Obligor to pay to the Bank, the LOC Provider, the TOB Liquidity
Provider or the TOB Placement and Remarketing Agent, as applicable, any amount
when due under this Agreement when the same shall have become due;
or

       

      (b) the
failure by the Obligor to perform or observe any covenant in Section 8.04,
8.05, 8.07, 8.08,8.09, 8.10 or 8.11(a) of this Agreement; or

       

      (c) the
failure by the Obligor to perform or observe any other term, covenant or
agreement contained in this Agreement not specified in paragraph (a) or (b)
above if such failure shall continue for a period of thirty (30) calendar days
after written notice thereof by the Bank to the Obligor; or

       

      (d) any
warranty, representation or other written statement made by the Obligor
contained herein or in any instrument furnished in compliance with or in
reference to any of the foregoing, is false or misleading in any material
respect on any date when made; or

       

      (e) the
occurrence of an Act of Bankruptcy with respect to the Obligor or any Affiliate;
or

       

      (f) any
material provision of this Agreement shall at any time for any reason cease to
be valid and binding in accordance with its terms on the Obligor or shall be
declared to be null and void, or the validity or enforceability hereof or
thereof shall be contested by the Obligor, or a proceeding shall be commenced by
the Obligor seeking to establish the invalidity or unenforceability hereof, or
the Obligor shall deny that it has any further liability or obligation under
this Agreement.

       

      
        
          
          

        

        
          17

          
            

          

        

        
          
          

        

      

      SECTION
9.02. Additional
Termination Events.  Each of the following events shall
constitute an Additional Termination Event under this Agreement with respect to
an Eligible Bond:

       

      (a) the
occurrence of an Act of Bankruptcy with respect to the issuer of such Eligible
Bond or the applicable Property Owner; or

       

      (b) a failure
of payment of any installment of principal of or premium, if any, or interest on
such Eligible Bond (whether by scheduled maturity, regular repayment,
acceleration, demand or otherwise); or

       

      (c) a failure
of the Enhancement Custodian to pay any principal or any interest on or with
respect to the related Enhanced Custody Receipts when due, if the LOC Provider
has timely paid all drawings properly presented under the related Letter of
Credit; or

      
         

      

      (d) the entry
of any decree or judgment by a court of competent jurisdiction, the taking of
any official action by the Internal Revenue Service or the Department of the
Treasury, or the occurrence of any similar action, in each case to the effect
that interest on such Eligible Bond is includable in the gross income of the
recipients thereof for federal income tax purposes, or the occurrence of any
other event of taxability or determination of taxability under the related Bond
Indenture; or

       

      (e) the
occurrence of an event of default under the related Bond Indenture, or any
default under any Operating Loan Note, Recorded Second Lien Mortgage or
Additional Second Lien Mortgage; or

       

      (f) any other
default under the Bond Indenture or other Bond Documents with respect to any
Bond; or

       

      (g) any drop
in market value of such Eligible Bond below its Trigger Price, unless within
five (5) business days after notice from the Bank, the Obligor delivers to the
Collateral Agent Additional Eligible Collateral  in an amount
acceptable to the Bank in its sole discretion.

      
         

      

      SECTION
9.03. Remedies.  (a)  Upon
the occurrence of an Event of Default, each of the Bank, the LOC Provider, the
TOB Liquidity Provider and the TOB Placement and Remarketing Agent may, in its
sole discretion, but shall not be obligated to, exercise any or all of the
following remedies:

       

      (i) by
written, or by electronic or telephonic immediately followed by written, notice
to the Obligor, declare all amounts payable by the Obligor under this Agreement
to be forthwith due and payable, and the same shall thereupon become due and
payable without demand, presentment, protest or further notice of any kind, all
of which are hereby expressly waived; or

       

      (ii) exercise
all or any of its rights and remedies as it may otherwise have under Applicable
Law and under this Agreement, under the New York UCC as a secured creditor, or
otherwise by such suits, actions, or special proceedings in equity or at law, or
by proceedings in the office of any board or officer having jurisdiction, either
for specific performance of any covenant or agreement contained in this
Agreement, or in aid or execution of any power therein granted or for the
enforcement of any proper legal or equitable remedy; or

       

      (iii) give
written notice to the Enhancement Custodian to cause the mandatory tender of any
or all Enhanced Custody Receipts;

       

      (iv) give
written notice to the related TOB Trustee to cause the mandatory tender of any
or all TOB Floaters; or

       

      (v) record
the Additional Second Lien Mortgages.

       

      (b) If an
Event of Default shall have occurred and be continuing, the Bank shall have the
right to the extent permitted by law, and the Obligor shall take all such action
as may be necessary or appropriate to give effect to such right, to cause the
Collateral to be registered in its name.

       

      (c) At any
time after the occurrence of an Event of Default, the Bank may instruct the
Collateral Agent to sell Collateral, in an amount estimated by the Bank to be
sufficient to generate proceeds in the amount of all or any portion of any cash
deficiency needed to satisfy all outstanding Obligations.

       

      (d) The
Collateral Agent shall use its best efforts to sell any Collateral pursuant to
paragraph (a) above in good faith and in such manner as the Collateral Agent
deems advisable at the highest obtainable price under current market conditions
within a period of four (4) Business Days from the date of the Event of
Default.

       

      (e) All
proceeds from the sale of any Collateral pursuant to this Section 9.03 (whether
to the Obligor or to a third party) shall be applied by the Collateral Agent in
the following order:

       

      
        
          
          

        

        
          18

          
            

          

        

        
          
          

        

      

      first, to payment of the
expenses of such sale or other disposition any any costs associated with the
exercise of any remedies by the Bank, including reasonable counsel fees and all
expenses, recording charges, liabilities and advances incurred or made by the
Collateral Agent or the Bank in connection therewith, including without
limitation the amount of any accrued but unpaid Collateral Agent
Fee;

       

      second, to payment to the
Bank, the LOC Provider, the TOB Liquidity Provider and the TOB Placement and
Remarketing Agent for application to payment of all outstanding Obligations;
and

       

      finally, on or after the date
on which the Bridge Loan and all Letters of Credit and TOB Liquidity Facilities
shall have been terminated and all Obligations hereunder shall have been paid in
full, to payment to or upon the order of the Obligor of any
surplus.

      
         

      

      (f) Upon the
occurrence of an Additional Termination Event, the LOC Bank may, in its sole
discretion, but shall not be obligated to, give written notice to the
Enhancement Custodian to cause the mandatory tender of the related Enhanced
Custody Receipts, or all Enhanced Custody Receipts, at its option, and the TOB
Liquidity Provider may, in its sole discretion, but shall not be obligated to,
give written notice to the related TOB Trustee to cause the mandatory tender of
any or all TOB Floaters.

       

      (g) No
failure or delay on the part of the Bank, the LOC Bank, the TOB Liquidity
Provider or the TOB Placement and Remarketing Agent to exercise any right or
remedy hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any right or remedy hereunder preclude any further exercise
thereof or the exercise of any further right or remedy hereunder.  The
remedies herein provided are cumulative and not exclusive of any remedies
provided by law.

      
         

      

      ARTICLE
X                                

       

      

       

      INDEMNIFICATION;
NATURE OF THE OBLIGOR’S DUTIES;

       

      SURVIVAL
OF PROVISIONS

       

      SECTION
10.01. Indemnification.  In
addition to any other amounts payable by the Obligor under this Agreement, the
Obligor hereby agrees to protect, indemnify, pay and save harmless the Bank and
its affiliates from and against any and all Losses that any of them may incur or
be subject to as a consequence of (i) any act or omission of the Obligor
related to the execution and delivery of this Agreement or any of the Related
Documents or performance thereunder, (ii) any breach by the Obligor of any
warranty, covenant, term or condition in, or the occurrence of any default
under, this Agreement or the Related Documents, including all reasonable fees or
expenses resulting from the settlement or defense of any claims or liabilities
arising as a result of any such breach or default, or (iii) involvement in
any legal suit, investigation, proceeding, inquiry or action as to which such
party is involved as a consequence of the execution and delivery of the Related
Documents or performance thereunder, its execution of this Agreement or any
Related Document or any other event or transaction contemplated by any of the
foregoing; provided,
that the Obligor shall not be liable under this Section 10.01 for any Losses
resulting from the willful misconduct or gross negligence of the Bank, the LOC
Provider, the TOB Liquidity Provider or the TOB Placement and Remarketing Agent,
as applicable, or the failure of the LOC Provider or the TOB Liquidity Provider
or TOB Placement and Remarketing Agent, as applicable, to perform under any
Letter of Credit, any TOB Liquidity Facility or any TOB Placement and
Remarketing Agreement.  The obligations of the Obligor under this
Section 10.01 shall survive the termination of this Agreement.

       

      SECTION
10.02. Environmental
Indemnity; Defense of Claims.  (a)  The Obligor
hereby agrees to protect, indemnify, defend, release and hold harmless the Bank,
the LOC Provider, the TOB Liquidity Provider and the TOB Placement and
Remarketing Agent from and against, and reimburse each such party on demand for,
any and all Losses paid, incurred or suffered by, or asserted against, such
party by any Person in connection with, arising out of or resulting in any way
whatsoever from:

       

      (i) the
presence, Release or threatened Release of any Hazardous Material at or from any
Property;

       

      (ii) any
violation or potential violation of any Environmental Requirement, regardless of
whether any act, omission, event or circumstance giving rise to the violation
constituted a violation at the time of the occurrence or inception of such act,
omission, event or circumstance;

       

      (iii) any
Environmental Claim related to any act, omission, event or condition existing or
occurring in connection with the use or occupancy of any Property;
or

       

      (iv) the
filing or imposition of any environmental lien against any
Property;

       

      and
regardless of whether any matter set forth in the foregoing clauses (i) through
(iv) was caused by the Obligor or any other Person whatsoever.  Such
indemnity shall not apply, however, to the extent that the subject of the
indemnification is or was caused by or arises out of the sole or gross
negligence or willful misconduct of such party.

       

      
        
          
          

        

        
          19

          
            

          

        

        
          
          

        

      

      (b) Upon
demand by the Bank, the Obligor shall diligently defend any Environmental Claim
which relates to any Property or is threatened or commenced against the Bank,
all at the Obligor’s own cost and expense and by counsel to be approved by the
Bank in the exercise of its reasonable judgment.

       

      SECTION
10.03. Survival of
Provisions.  The provisions of Sections 3.01, 3.02, 3.10, 7.09,
10.01 and 10.02 hereof shall survive the termination of this
Agreement.

      
         

      

      ARTICLE
XI                            

       

      DISPUTE
RESOLUTION

      SECTION
11.01. Arbitration.  Except
to the extent expressly provided below, any Dispute shall, upon the request of
any party, be determined by binding arbitration in accordance with the Federal
Arbitration Act, Title 9, United States Code (or if not applicable, the
applicable state law), the then-current rules for arbitration of financial
services disputes of AAA and the “Special Rules” set forth below.  In
the event of any inconsistency, the Special Rules shall control.  The
filing of a court action is not intended to constitute a waiver of the right of
the Bank, the TOB Placement and Remarketing Agent, the Collateral Agent or the
Obligor, including the suing party, thereafter to require submittal of the
Dispute to arbitration.  Any party hereto may bring an action,
including a summary or expedited proceeding, to compel arbitration of any
Dispute in any court having jurisdiction over such action.

       

      SECTION
11.02. Special
Rules.

       

      (a) The
arbitration shall be conducted in any U.S. state where real or tangible personal
property collateral is located, or if there is no such collateral, in the City
and County where the Bank is located pursuant to its address for purposes of
Section 12.04 of this Agreement.

       

      (b) The
arbitration shall be administered by AAA, who will appoint an
arbitrator.  If AAA is unwilling or unable to administer the
arbitration, or if AAA is unwilling or unable to enforce or legally precluded
from enforcing any and all provisions of this Article X, then the Bank may
substitute another arbitration organization that has similar procedures to AAA
and that will observe and enforce any and all provisions of this Article
X.  All Disputes shall be determined by one arbitrator; provided, however, that if the amount
in controversy in a Dispute exceeds $5,000,000, upon the request of either
party, the Dispute shall be decided by three arbitrators (for purposes of this
Agreement, referred to collectively as the “arbitrator”).

       

      (c) All
arbitration hearings will be commenced within ninety (90) days of the demand for
arbitration and completed within ninety (90) days from the date of commencement;
provided, however, that upon a showing
of good cause, the arbitrator shall be permitted to extend the commencement of
such hearing for up to an additional sixty (60) days.

       

      (d) The
judgment and the award, if any, of the arbitrator shall be issued within thirty
(30) days of the close of the hearing.  The arbitrator shall provide a
concise written statement setting forth the reasons for the judgment and for the
award, if any.  The arbitration award, if any, may be submitted to any
court having jurisdiction to be confirmed and enforced, and such confirmation
and enforcement shall not be subject to arbitration.

       

      (e) The
arbitrator will give effect to statutes of limitations and any waivers thereof
in determining the disposition of any Dispute and may dismiss one or more claims
in the arbitration on the basis that such claim or claims is or are
barred.  For purposes of the application of the statute of
limitations, the service on AAA under applicable AAA rules of a notice of
Dispute is the equivalent of the filing of a lawsuit.

       

      (f) Any
dispute concerning this arbitration provision, including any such dispute as to
the validity or enforceability of this provision, or whether a Dispute is
arbitrable, shall be determined by the arbitrator; provided, however, that the arbitrator
shall not be permitted to vary the express provisions of these Special Rules or
the Reservations of Rights in Section 11.03 below.

       

      (g) The
arbitrator shall have the power to award legal fees and costs pursuant to the
terms of this Agreement.

       

      (h) The
arbitration will take place on an individual basis without reference to, resort
to, or consideration of any form of class or class action.

       

      SECTION
11.03. Reservations of
Rights.  Nothing in this Agreement shall be deemed to (i) limit
the applicability of any otherwise applicable statutes of limitation and any
waivers contained in this Agreement, or (ii) apply to or limit the right of the
Bank (A) to exercise self help remedies such as (but not limited to)
setoff, or (B) to foreclose judicially or nonjudicially against any real or
personal property collateral, or to exercise judicial or nonjudicial power of
sale rights, (C) to obtain from a court provisional or ancillary remedies
such as (but not limited to) injunctive relief, writ of possession, prejudgment
attachment, or the appointment of a receiver, or (D) to pursue rights against a
party to this Agreement in a third-party proceeding in any action brought
against the LOC Provider, the TOB Liquidity Provider or the TOB Placement and
Remarketing Agent in a state, federal or international court, tribunal or
hearing body (including actions in specialty courts, such as bankruptcy and
patent courts).  The Bank may exercise the rights set forth in clauses
(A) through (D), inclusive, before, during or after the pendency of any
arbitration proceeding brought pursuant to this Agreement.  Neither
the exercise of self help remedies nor the institution or maintenance of an
action for foreclosure or provisional or ancillary remedies shall constitute a
waiver of the right of any party, including the claimant in any such action, to
arbitrate the merits of the Dispute occasioning resort to such
remedies.  No provision herein regarding submission to jurisdiction
and/or venue in any court is intended or shall be construed to be in derogation
of the provisions herein for arbitration of any Dispute.

      
        20

        
          

        

      

      
      

      SECTION
11.04. Conflicting
Provisions for Dispute Resolution.  If there is any conflict
between the terms, conditions and provisions of this Section and those of any
other provision or agreement for arbitration or dispute resolution, the terms,
conditions and provisions of this Article shall prevail as to any Dispute
arising out of or relating to (i) this Agreement or (ii) the transactions
contemplated herein (including any claim based on or arising from an alleged
personal injury or business tort).  In any other situation, if the
resolution of a given Dispute is specifically governed by another provision or
agreement for arbitration or dispute resolution, the other provision or
agreement shall prevail with respect to said Dispute.

       

      SECTION
11.05. Jury Trial Waiver
in Arbitration.  The parties hereto irrevocably and voluntarily
waive any right they may have to a trial by jury in respect of any
Dispute.

      
         

      

      ARTICLE
XII

       

       

      MISCELLANEOUS

       

      SECTION
12.01. Waivers,
Amendments.  This Agreement may be amended only by a written
instrument duly executed by each of the parties hereto.  The Obligor
may take any action herein prohibited or omit to perform any act herein required
to be performed by it, only if the Obligor shall first have obtained the written
consent of the Bank and the TOB Placement and Remarketing Agent
thereto.  No course of dealing among the parties hereto, nor any delay
in exercising any rights hereunder, shall operate as a waiver of any rights of
any party hereunder.  Unless otherwise specified in such waiver or
consent, a waiver or consent given hereunder shall be effective only in the
specific instance and for the specific purpose for which given.

       

      SECTION
12.02. Survival of
Representations and Warranties.  All statements contained in
any certificate, financial statement or other instrument delivered by the
Obligor pursuant to or in connection with this Agreement (including but not
limited to any such statement made in or in connection with any amendment hereto
or thereto) shall constitute representations and warranties made under this
Agreement.  All representations and warranties made under this
Agreement (i) shall be made and shall be true at and as of the date of this
Agreement and (ii) shall survive the execution and delivery of this
Agreement, regardless of any investigation made by the Bank or the TOB Placement
and Remarketing Agent.

       

      SECTION
12.03. Termination of
Agreement.  This Agreement shall remain in full force and
effect until all Obligations have been irrevocably paid in
full.  Notwithstanding the foregoing, the Bank shall have the right to
terminate this Agreement only upon the occurrence of an
Enhanced  Custody Receipt Mandatory Tender Event.

       

      SECTION
12.04. Notices.  All
notices, requests and other communications provided for hereunder shall be in
electronic, telephonic or written (including bank wire, telegram, facsimile,
telex or similar writing) form and shall be given to the party to whom sent,
addressed to it, at its address or telephone, facsimile or telex number set
forth below or such other address or telephone or facsimile number as such party
may hereafter specify for the purpose by notice to the other parties set forth
below.  Each such notice, request or communication shall be effective
(i) if given by telephone, facsimile or other electronic means, when such
communication is transmitted to the address specified below and any appropriate
answerback is received, (ii) if given by mail, three (3) Business Days after
such communication is deposited in the mails with first class postage prepaid,
addressed as aforesaid, (iii) if given by any other means, when delivered at the
address specified below:

       

      (a) if to the
Obligor:

       

      America
First Tax Exempt Investors, L.P.

       

      1004
Farnam Street

       

      Omaha,
Nebraska 68102

       

      Facsimile:
(402) 930-3047

       

      Telephone:
(402) 930-3085

       

      Attention:
Chad Daffer, Andy Grier and Michelle Lage

       

      
        
          
          

        

        
          21

          
            

          

        

        
          
          

        

      

      (b) if to the
Bank or the LOC Provider:

       

      Bank of
America, N.A.

       

      Trade
Financial Services

       

      1000 W.
Temple Street

       

      Los
Angeles, CA 90012

       

      Facsimile:
(213) 457-8841

       

      Telephone:
(213) 240-6986

       

      Attention:
Sandra Leon, Vice President

      
         

      

      (c) if to the
TOB Liquidity Provider:

       

      Bank of
America, N.A.

       

      1633
Broadway, 28th
Floor

       

      New York,
NY 10019

       

      Facsimile:
(212) 457-3878

       

      Telephone:
(212) 497-8899

       

      Attention:
Structured Municipal Products Desk

       

      (d) if to the
TOB Placement and Remarketing Agent:

       

      Banc of
America Securities LLC

       

      600
Montgomery Street

       

      Mail
Code: CA5-801-07-33

       

      San
Francisco, California  94111-2702

       

      Facsimile:
(415) 986-1194

       

      Telephone:
(415) 913-3548

       

      Attention:
Ila Afsharipour

       

      (e) if to the
Collateral Agent:

       

      Deutsche
Bank Trust Company Americas

       

      60 Wall
Street, 27th Floor

       

      New York,
New York 10005

       

      Facsimile:
(212) 797-8618

       

      Telephone:  (212)
250-2679

       

      Attention:
Trust & Securities Services (Municipal Group)

       

      
        
          
          

        

        
          22

          
            

          

        

        
          
          

        

      

      or (iv)
in any of the foregoing cases, at such other address or telex, facsimile, bank
wire or telephone number as the addressee may hereafter specify for the purpose
in a notice to the other party specifically captioned “Notice of Change of
Address pursuant to Section 12.04 of the Shortfall, Fee and Collateral
Agreement.”

       

      SECTION
12.05. Continuing
Obligation.  This Agreement is a continuing obligation of the
Obligor and shall, until the date on which the Bridge Loan and all Letters of
Credit and TOB Liquidity Facilities have been terminated and all Obligations
hereunder shall have been paid in full, (a) be binding upon the Obligor and
its successors and assigns, and (b) inure to the benefit of and be
enforceable by the Bank, the LOC Provider, the TOB Liquidity Provider, the TOB
Placement and Remarketing Agent and their respective successors, transferees and
assigns; provided that
the Obligor may not assign all or any part of this Agreement without the prior
written consent of the Bank, the LOC Provider, the TOB Liquidity Provider and
the TOB Placement and Remarketing Agent.

       

      SECTION
12.06. Satisfaction
Requirement.  If any agreement, certificate or other writing,
or any action taken or to be taken, is by the terms of this Agreement required
to be satisfactory to the Bank, the LOC Provider, the TOB Liquidity Provider or
the TOB Placement and Remarketing Agent, the determination of such satisfaction
shall be made by such party in its sole and exclusive judgment exercised in good
faith.

       

      SECTION
12.07. Governing
Law.  PURSUANT TO SECTION 5-1401 OF THE NEW YORK GENERAL
OBLIGATIONS LAW (OR ANY SUCCESSOR STATUTE THERETO), THIS AGREEMENT SHALL BE
DEEMED TO BE A CONTRACT UNDER, AND SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK AND APPLICABLE
FEDERAL LAW.

      
         

      

      SECTION
12.08. Waiver of Jury
Trial.  WITHOUT INTENDING IN ANY WAY TO LIMIT THE PARTIES’
AGREEMENT TO ARBITRATE ANY DISPUTE AS SET FORTH HEREIN, TO THE EXTENT ANY
DISPUTE IS NOT SUBMITTED TO ARBITRATION OR IS DEEMED BY THE ARBITRATOR OR BY ANY
COURT WITH JURISDICTION TO BE NOT ARBITRABLE OR NOT REQUIRED TO BE ARBITRATED,
THE OBLIGOR, THE BANK, THE LOC PROVIDER, THE TOB LIQUIDITY PROVIDER, THE TOB
PLACEMENT AND REMARKETING AGENT AND THE COLLATERAL AGENT EACH HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY
IN RESPECT OF ANY LITIGATION (WHETHER AS CLAIM, COUNTER CLAIM, AFFIRMATIVE
DEFENSE OR OTHERWISE) BASED HEREON, OR ARISING OUT OF, UNDER OR IN CONNECTION
WITH, THIS AGREEMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS
(WHETHER ORAL OR WRITTEN) OR ACTIONS OF THE OBLIGOR, THE BANK, THE LOC PROVIDER,
THE TOB LIQUIDITY PROVIDER, THE TOB PLACEMENT AND REMARKETING AGENT OR THE
COLLATERAL AGENT.  THE OBLIGOR ACKNOWLEDGES AND AGREES THAT IT HAS
RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION AND RECOGNIZES AND
AGREES THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE NAK, THE LOC
PROVIDER, THE TOB LIQUIDITY PROVIDER AND THE TOB PLACEMENT AND REMARKETING AGENT
ENTERING INTO THIS AGREEMENT AND MAKING THE BRIDGE LOAN, ISSUING THE LETTERS OF
CREDIT, ISSUING THE TOB LIQUIDITY FACILITIES AND PROVIDING THE REMARKETING
SERVICES, RESPECTIVELY.  THE OBLIGOR REPRESENTS AND ACKNOWLEDGES THAT
IT HAS REVIEWED THIS PROVISION WITH ITS LEGAL COUNSEL AND THAT IT HAS KNOWINGLY
AND VOLUNTARILY WAIVED ANY JURY TRIAL RIGHTS IT MAY HAVE FOLLOWING CONSULTATION
WITH SUCH LEGAL COUNSEL.

       

      SECTION
12.09. Consent to
Jurisdiction, Venue and Service of Process.  Pursuant to, and
in accordance with, Section 5-1402 of the New York General Obligations Law (or
any successor statute thereto), the Obligor, the Bank, the LOC Provider, the TOB
Liquidity Provider, the TOB Placement and Remarketing Agent and the Collateral
Agent irrevocably (a) agree that any suit, action or other legal proceeding
arising out of or relating to this Agreement may be brought in the non-exclusive
jurisdiction of a court of record in the State of New York located in the
Borough of Manhattan or in the United States District Court for the Southern
District of the State of New York located in the Borough of Manhattan,
(b) consent and submit to the jurisdiction of each such court in any such
suit, action or proceeding, and (c) waive any objection which it may have
to the laying of venue of any such suit, action or proceeding in any of such
courts and any claim that any such suit, action or proceeding has been brought
in an inconvenient forum.  The Obligor, the Bank, the LOC Provider,
the TOB Liquidity Provider, the TOB Placement and Remarketing Agent and the
Collateral Agent also irrevocably consent to the service of any and all process
in any such action or proceeding by the mailing of copies of such process to the
respective address set forth for such party in
Section 12.04.  The Obligor, the Bank, the LOC Provider, the TOB
Liquidity Provider, the TOB Placement and Remarketing Agent and the Collateral
Agent agree that a final judgment in any suit, action or proceeding shall be
conclusive and may be enforced in appropriate jurisdictions by suit on the
judgment or in any other manner provided by law.  All mailings under
this Section 12.09 shall be by certified mail, return receipt
requested.

       

      Nothing
in this Section 12.09 shall affect the right of the Bank, the LOC Provider, the
TOB Liquidity Provider, the TOB Placement and Remarketing Agent and the
Collateral Agent to serve legal process in any other manner permitted by law or
affect the right of the Bank, the LOC Provider, the TOB Liquidity Provider, the
TOB Placement and Remarketing Agent or the Collateral Agent to bring any suit,
action or proceeding against the Obligor or its property in the courts of any
other jurisdiction.

       

      SECTION
12.10. Counterparts.  This
Agreement may be signed in any number of counterpart copies, but all such copies
shall constitute one and the same instrument.

       

      
        
          
          

        

        
          23

          
            

          

        

        
          
          

        

      

      SECTION
12.11. Complete and
Controlling Agreement.  This Agreement completely sets forth
the agreements among the Bank, the LOC Provider, the TOB Liquidity Provider, the
TOB Placement and Remarketing Agent and the Collateral Agent and the Obligor,
and fully supersedes all prior agreements, both written and oral, among the
parties relating to the Bridge Loan, the issuance of the Letters of Credit, the
issuance of the TOB Liquidity Facilities and provision of remarketing
services.

       

      SECTION
12.12. Severability.  Any
provision of this Agreement that is prohibited, unenforceable or not authorized
in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent
of such prohibition, unenforceability or non-authorization without invalidating
the remaining provisions hereof or affecting the validity, enforceability or
legality of such provision in any other jurisdiction and the remaining portion
of such provision and all other remaining provisions will be construed to render
them enforceable to the fullest extent.

       

      SECTION
12.13. Business
Days.  If any payment under this Agreement shall be specified
to be made upon a day which is not a Business Day, it shall be made on the next
succeeding day which is a Business Day, and such extension of time shall in such
case be included in computing interest, if any, in connection with such
payment.

       

      SECTION
12.14. Headings.  Section
headings in this Agreement are included herein for convenience of reference only
and shall not constitute a part of this Agreement for any other
purpose.

       

      SECTION
12.15. USA PATRIOT
Act.  The Bank hereby notifies the Obligor that pursuant to the
requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into
law October 26, 2001)), it is required to obtain, verify and record information
that identifies the Obligor, which information includes the name and address of
the Obligor and other information that will allow the Bank to identify the
Obligor in accordance with said Act.  The Obligor shall promptly
provide such information.

      
         

      

      SECTION
12.16. Confidentiality;
Publicity Releases.  (a)  The Obligor agrees that the
Bank, the LOC Provider, the TOB Liquidity Provider and the TOB Placement and
Remarketing Agent may exchange or disclose information pertaining to this
Agreement, the Related Documents, any Eligible Bond or Collateral Bond and any
Property (including, without limitation, financial information, copies of
appraisals, environmental reports, physical needs assessments, inspection
reports, engineering reports, copies of Eligible Bond and Collateral Bond
documents and participation documents, if applicable, and any other information
in the possession of the Bank, the LOC Provider, the TOB Liquidity Provider or
the TOB Placement and Remarketing Agent) and financial information about the
Obligor, any of its partners or any affiliate with or to any Bank of America
Corporation affiliates or other related entities, with any prospective purchaser
of the Enhanced Custody Receipts or TOB Receipts, to any regulatory body having
jurisdiction over the Bank, the LOC Provider, the TOB Liquidity Provider, or the
TOB Placement and Remarketing Agent, as applicable, with professional service
providers engaged by the Bank, the LOC Provider, the TOB Liquidity Provider, the
TOB Placement and Remarketing Agent or their respective affiliates or other
related entities or by any such prospective purchaser, and with any other
persons who require or request such information as necessary or appropriate in
the Bank’s, the LOC Provider’s, the TOB Liquidity Provider’s or the TOB
Placement and Remarketing Agent’s, as applicable, reasonable judgment, and the
TOB Placement and Remarketing Agent may disclose all legally required or
customary information regarding the Obligor, the Bridge Loan, the Eligible
Bonds, the Collateral Bonds, the Related Documents and each Property to all
investors or prospective investors in TOB Receipts; provided, that the Bank, the
LOC Provider, the TOB Liquidity Provider and the TOB Placement and Remarketing
Agent agree not to publicly disclose any confidential financial information
regarding the Obligor that is specifically designated as confidential by the
Obligor, except as such information is required to be disclosed by the Bank, the
LOC Provider, the TOB Liquidity Provider or the TOB Placement and Remarketing
Agent to any regulatory body having jurisdiction over the Bank, the LOC
Provider, the TOB Liquidity Provider or the TOB Placement and Remarketing Agent,
as applicable, or to professional service providers engaged by the Bank, the LOC
Provider, the TOB Liquidity Provider, the TOB Placement and Remarketing Agent or
its respective affiliates or other related entities, which shall also agree to
maintain the confidentiality of such information.  The Obligor agrees
to update this information at such times as may be reasonably requested by the
Bank, the LOC Provider, the TOB Liquidity Provider or the TOB Placement and
Remarketing Agent, and if so requested by the Bank, the LOC Provider, the TOB
Liquidity Provider or the TOB Placement and Remarketing Agent, to provide
summary disclosure information about each Property and each Eligible Bond or
Collateral Bond for which no current disclosure is available.

       

      (b) The
Obligor agrees that the Bank, the LOC Provider, the TOB Liquidity Provider and
the TOB Placement and Remarketing Agent may issue publicity releases to
newspapers and trade publications announcing the financing arrangements relating
to this Agreement.  The Bank, the LOC Provider, the TOB Liquidity
Provider and the TOB Placement and Remarketing Agent agree that the Obligor may
issue any publicity releases required by Applicable Law; provided, that any such
release that names the Bank, the LOC Provider, the TOB Liquidity Provider or the
TOB Placement and Remarketing Agent shall be subject to such party’s prior
consent.

       

      [SIGNATURE
PAGES FOLLOW]

       

      

       

      
        
           

        

        
          24

          
            

          

        

        
           

        

      

      IN
WITNESS WHEREOF, the parties hereto have caused this Shortfall, Fee and
Collateral Agreement to be duly executed and delivered by their respective duly
authorized officers as of the date hereof.

       

      

      

      

      BANK
OF AMERICA, N.A.

      as Bridge Loan Lender

      

      

      By:                                                                /s/ Laura
Sheehan

      Name: Laura Sheehan

      Title:  Vice
President

      

      

      

      BANK
OF AMERICA, N.A.

      as LOC Provider

      

      

      By:                                                                /s/ Laura
Sheehan

      Name: Laura Sheehan

      Title:   Vice
President

      

      

      

      BANK
OF AMERICA, N.A.

      as TOB Liquidity Provider

       

      By:                                                                /s/ Daniel E.
George

      Name: Daniel E. George

      Title:   Principal

      

      

      

      BANC
OF AMERICA SECURITIES LLC

      as
Placement and Remarketing Agent

      

      

      By:                                                                /s/ Jodi Furman

      Name: Jodi Furman

      Title:   Analyst

      

      

      
        
           

        

        
          25

          
            

          

        

        
           

        

      

      

      AMERICA
FIRST TAX EXEMPT INVESTORS, L.P.

      as Obligor

      

      
        	
                 
      

              	
                By:America
      First Capital Associates Limited Partnership Two, a Delaware limited
      partnership, its general partner

              

      

      

      
        	
                 
      

              	
                By:The
      Burlington Capital Group, LLC, a Delaware limited liability company, its
      general partner

              

      

      

      

      

      
        	
                 

              	By: /s/
      Michael J.
      Draper	 

      

               Name:
Michael J. Draper

               Title:   Chief
Financial Officer

      

      

      

      DEUTSCHE BANK TRUST COMPANY
AMERICAS, as Collateral Agent

      

      

      By:                                                                /s/ Safet
Kalabovic

      Name: Safet Kalabovic

      Title:   Vice
President

      

      

      By:                                                                /s/ Teddy Banica

      Name: Teddy Banica

      Title:   Assistant
Vice President

      

      

      

      

      

       

      
        
           

        

        
          26

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