EX-10 2 cmtg-ex10_50.htm EX-10.50 EX-10

Exhibit 10.5

EXECUTION VERSION

 

 

 

 

 

 

 

AMENDED AND RESTATED MASTER REPURCHASE AND

SECURITIES CONTRACT AGREEMENT

 

among

 

CMTG GS FINANCE LLC,

 

as Seller, GOLDMAN SACHS BANK USA,

as Administrative Agent, and

THE FINANCIAL INSTITUTIONS PARTY HERETO

 

as Buyers

 

 

 

 

 

Dated: March 7, 2022

 

 

 

 

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Page

 

 

 

ARTICLE 1. APPLICABILITY 1

ARTICLE 2. DEFINITIONS 2

ARTICLE 3. INITIATION; CONFIRMATION; TERMINATION; FEES 28

ARTICLE 4. MARGIN MAINTENANCE 37

ARTICLE 5. INCOME PAYMENTS AND PRINCIPAL PAYMENTS 38

ARTICLE 6. SECURITY INTEREST 39

ARTICLE 7. PAYMENT, TRANSFER AND CUSTODY 41

ARTICLE 8. SALE, TRANSFER, HYPOTHECATION OR PLEDGE OF PURCHASED

ASSETS 43

ARTICLE 9. REPRESENTATIONS AND WARRANTIES 43

ARTICLE 10. NEGATIVE COVENANTS OF SELLER 51

ARTICLE 11. AFFIRMATIVE COVENANTS OF SELLER 52

ARTICLE 12. SINGLE PURPOSE ENTITY 57

ARTICLE 13. EVENTS OF DEFAULT; REMEDIES 59

ARTICLE 14. INCREASED COSTS; TAXES 65

ARTICLE 15. SINGLE AGREEMENT 71

ARTICLE 16. RECORDING OF COMMUNICATIONS 71

ARTICLE 17. NOTICES AND OTHER COMMUNICATIONS 71

ARTICLE 18. ENTIRE AGREEMENT; SEVERABILITY 72

ARTICLE 19. NON ASSIGNABILITY 72

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ARTICLE 20. GOVERNING LAW 73

ARTICLE 21. NO WAIVERS, ETC. 73

ARTICLE 22. USE OF EMPLOYEE PLAN ASSETS 73

ARTICLE 23. INTENT 74

ARTICLE 24. DISCLOSURE RELATING TO CERTAIN FEDERAL PROTECTIONS 75

ARTICLE 25. CONSENT TO JURISDICTION; WAIVERS 76

ARTICLE 26. NO RELIANCE 77

ARTICLE 27. INDEMNITY 77

ARTICLE 28. DUE DILIGENCE 78

ARTICLE 29. SERVICING 79

ARTICLE 30. ADMINISTRATIVE AGENT 80

ARTICLE 31. MISCELLANEOUS 83

ARTICLE 32. AMENDMENT AND RESTATEMENT 86

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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ANNEXES, EXHIBITS AND SCHEDULES

ANNEX I Names and Addresses for Communications among Parties SCHEDULE I Prohibited Transferees

SCHEDULE II Purchased Asset File

SCHEDULE III Buyers

EXHIBIT I Form of Confirmation Statement EXHIBIT II Authorized Representatives of Seller EXHIBIT III-A Monthly Reporting Package EXHIBIT III-B Quarterly Reporting Package EXHIBIT III-C Annual Reporting Package EXHIBIT IV Form of Power of Attorney

EXHIBIT V Representations and Warranties Regarding Individual Purchased Assets EXHIBIT VI Advance Procedures

EXHIBIT VII Form of Margin Deficit Notice EXHIBIT VIII Form of Tax Compliance Certificates

EXHIBIT IX Form of Covenant Compliance Certificate EXHIBIT X UCC Filing Jurisdictions

EXHIBIT XI Form of Servicer Notice

EXHIBIT XII Form of Release Letter

EXHIBIT XIII Reserved

EXHIBIT XIV Form of Custodial Delivery Certificate EXHIBIT XV Form of Bailee Letter

EXHIBIT XVI Reserved

EXHIBIT XVII Future Funding Advance Procedures

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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AMENDED AND RESTATED MASTER REPURCHASE AND SECURITIES CONTRACT AGREEMENT

 

THIS AMENDED AND RESTATED MASTER REPURCHASE AND SECURITIES CONTRACT

AGREEMENT (this “Agreement”), dated as of March 7, 2022, by and among GOLDMAN SACHS BANK USA, a New York state-chartered bank, as administrative agent (in such capacity, together with its permitted successors and assigns, the “Administrative Agent”) for GOLDMAN SACHS BANK USA, a New York state-chartered bank (“GSBUSA”), and such other financial institutions from time to time party hereto as buyers (GSBUSA, together with the entities listed on Schedule III hereto as of the date hereof, and such other financial institutions from time to time party hereto as buyers, and together with their respective successors and assigns, collectively “Buyers” and individually, each a “Buyer”), Buyers and CMTG GS FINANCE LLC, a Delaware limited liability company (“Seller”).

 

WHEREAS, GSBUSA and Seller are parties to that certain Master Repurchase and Securities Contract Agreement, dated as of May 31, 2017, as amended by that certain First Amendment to Master Repurchase and Securities Contract Agreement, dated as of May 29, 2018, as further amended by that certain Second Amendment to Master Repurchase and Securities Contract Agreement, dated as of August 31, 2018, as further amended by that certain Third Amendment to Master Repurchase and Securities Contract Agreement and First Amendment to Guarantee Agreement, dated as of March 12, 2019, as further amended by that certain Fourth Amendment to Master Repurchase and Securities Contract Agreement, dated as of May 1, 2019, as further amended by that certain Fifth Amendment to Master Repurchase and Securities Contract Agreement, dated as of October 30, 2019, as further amended by that certain Sixth Amendment to Master Repurchase and Securities Contract Agreement, dated as of April 15, 2020, as further amended by that certain Forbearance Agreement and Seventh Amendment to Master Repurchase and Securities Contract Agreement, dated as of June 11, 2020, as further amended by that certain Eighth Amendment to Master Repurchase and Securities Contract Agreement, dated as of May 27, 2021, and as further amended by that certain Ninth Amendment to Master Repurchase and Securities Contract Agreement and Second Amendment to Fee Letter, dated as of September 2, 2021 (collectively, the “Original Master Repurchase Agreement”);

 

WHEREAS, Administrative Agent, Buyers and Seller desire to amend and restate the Original Master Repurchase Agreement in its entirety upon the terms and conditions hereinafter set forth.

 

NOW, THEREFORE, in consideration of the covenants set forth in this Agreement, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree that the Original Master Repurchase Agreement is hereby amended and restated in its entirety as follows:

 

ARTICLE 1.

APPLICABILITY

 

From time to time during the Availability Period the parties hereto may enter into transactions in which Seller and Administrative Agent, on behalf of Buyers, agree to the transfer from Seller to Administrative Agent, on behalf of Buyers, of all of its rights, title and interest in certain Eligible Assets (as defined herein) or other assets and, in each case, the other related Purchased Items (as defined herein) (collectively, the “Assets”) against the transfer of funds by Buyers to Seller, with a simultaneous agreement by Administrative Agent, on behalf of Buyers, to transfer back to Seller such Assets at a date certain or on demand, against the transfer of funds by Seller to Administrative Agent, on behalf of Buyers. Each such transaction shall be referred to herein as a “Transaction” and, unless otherwise agreed in writing, shall be governed by this Agreement, including any supplemental terms or conditions contained in any exhibits identified herein as applicable hereunder. Each individual transfer of an

 

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Eligible Asset shall constitute a distinct Transaction. Notwithstanding any provision or agreement herein, at no time shall Administrative Agent, on behalf of Buyers, be obligated or committed to purchase or effect the transfer of any Eligible Asset from Seller to Administrative Agent, on behalf of Buyers. For the avoidance of doubt, upon receipt of the Repurchase Price in each Transaction, Administrative Agent, on behalf of Buyers, shall be obligated to return to Seller the same Purchased Assets Seller originally transferred to Administrative Agent, on behalf of Buyers, pursuant to such Transaction in accordance with the terms hereof.

 

ARTICLE 2. DEFINITIONS

 

1934 Act” shall mean the Securities Exchange Act of 1934, as amended.

 

Accelerated Repurchase Date” shall have the meaning set forth in Article 13(b)(i) of this Agreement.

 

Acceptable Attorney” shall mean an attorney at law that has delivered at Seller’s request a Bailee Letter, with the exception of an attorney that is not satisfactory to Administrative Agent, on behalf of Buyers, as specified in a written notice from Administrative Agent to Seller.

 

Accepted Servicing Practices” shall mean with respect to any applicable Purchased Asset, those mortgage loan servicing practices of prudent mortgage lending institutions that service mortgage loans of the same type as such Purchased Asset in the jurisdiction where the related underlying real estate directly or indirectly securing or supporting such Purchased Asset is located.

 

Act of Insolvency” shall mean, with respect to any Person, (i) the filing of a petition by such Person, commencing, or authorizing the commencement of any case or proceeding under any bankruptcy, insolvency, reorganization, wind up, liquidation, dissolution or similar law relating to the protection of creditors (“Insolvency Law”), or suffering any such petition or proceeding to be commenced by another which is consented to, not timely contested or results in entry of an order for relief that, in the case of an action not initiated by or on behalf of or with the consent of Seller, is not dismissed or stayed within sixty

(60) days; (ii) the seeking or consenting to the appointment of a liquidator, receiver, trustee, custodian or similar official for such Person or any substantial part of the property of such Person; (iii) the appointment of a receiver, conservator, or manager for such Person by any governmental agency or authority having the jurisdiction to do so; (iv) the making of a general assignment for the benefit of creditors; (v) the admission by such Person of its inability to pay its debts or discharge its obligations as they become due or mature; (vi) that any Governmental Authority or agency or any person, agency or entity acting or purporting to act under Governmental Authority shall have taken any action to condemn, seize or appropriate, or to assume custody or control of, all or any substantial part of the property of such Person, or shall have taken any action to displace the management of such Person or to curtail its authority in the conduct of the business of such Person; (vii) the consent by such Person to the entry of an order for relief in an insolvency case under any Insolvency Law; or (viii) the taking of action by any such Person in furtherance of any of the foregoing.

 

Additional Advance” shall have the meaning set forth in Article 3(k) of this Agreement.

 

Administrative Agent” shall mean Goldman Sachs Bank USA, a New York state-chartered bank, in its capacity as administrative agent hereunder, together with its permitted successors and assigns.

 

Advance Rate” shall mean, with respect to each Transaction, the initial Advance Rate selected by Administrative Agent, on behalf of Buyers, for such Transaction on a case by case basis in its sole

 

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discretion as shown in the related Confirmation, as may be adjusted for any Future Funding Advance as set forth herein and reflected in any amended and restated Confirmation, which in any case shall not exceed the Maximum Advance Rate, unless otherwise agreed to by Administrative Agent, on behalf of Buyers, and Seller.

 

Affiliate” shall mean, when used with respect to any specified Person, any other Person directly or indirectly Controlling, Controlled by, or under common Control with, such Person.

 

Agreement” shall mean this Amended and Restated Master Repurchase and Securities Contract Agreement, dated as of the date hereof, by and among Seller, Administrative Agent and Buyers as such agreement may be amended, restated, modified or supplemented from time to time.

 

Amortization Period” shall have the meaning specified in Article 3(m)(i).

 

Amortization Period Additional Percentage” shall have the meaning set forth in the Fee Letter, which definition is incorporated herein by reference.

 

Amortization Period Beginning Balance” shall mean the aggregate outstanding Purchase Prices of all Purchased Assets on the Availability Period Expiration Date.

 

Amortization Period Conditions” shall have the meaning specified in Article 3(m)(i).

 

Amortization Period Expiration Date” shall have the meaning specified in Article 3(m)(i).

 

Amortization Period Fee” shall have the meaning set forth in the Fee Letter, which definition is incorporated herein by reference.

 

Amortization Period Purchased Assets” shall mean those Purchased Assets that will remain subject to the terms of this Agreement during the Amortization Period in accordance with Article 3(m)(i).

 

Annual Reporting Package” shall mean the reporting package described on Exhibit III-C.

 

Anti-Money Laundering Laws” shall have the meaning set forth in Article 9(b)(xxix) of this Agreement.

 

Applicable Spread” shall mean:

 

(i)
so long as no Event of Default shall have occurred and be continuing, the amount set forth in the Fee Letter as being the “Applicable Spread”, and

 

(ii)
after the occurrence and during the continuance of an Event of Default, the (x) applicable incremental percentage described in clause (i) of this definition, plus (y) five percent (5.0%).

 

Appraisal” shall mean an appraisal of the related Underlying Mortgaged Property from an Independent Appraiser that is compliant with the Financial Institutions Reform, Recovery, and Enforcement Act and prepared by a third-party appraiser addressed to, or permitted to be relied upon by, Administrative Agent, on behalf of Buyers, and satisfactory to Administrative Agent.

 

Assets” shall have the meaning set forth in Article 1 of this Agreement.

 

Assignee” shall have the meaning set forth in Article 19(a) of this Agreement.

 

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Assignment of Leases” shall mean, with respect to any Purchased Asset that is a Senior Mortgage Loan, any assignment of leases, rents and profits or equivalent instrument, whether contained in the related Mortgage or executed separately, assigning to the holder or holders of such Mortgage all of the related Mortgagor’s interest in the leases, rents and profits derived from the ownership, operation, leasing or disposition of all or a portion of the related Underlying Mortgaged Property as security for repayment of such Purchased Asset.

 

Availability Period” shall mean the period commencing on the Closing Date and expiring on the Availability Period Expiration Date.

 

Availability Period Expiration Date” shall mean May 31, 2022, as the same may be extended in accordance with Article 3(i)(ii) of this Agreement.

 

Availability Period Renewal Conditions” shall have the meaning set forth in Article 3(i) of this Agreement.

 

Bailee Letter” shall mean a letter substantially in the form as Exhibit XV from an Acceptable Attorney or a Title Company or another Person acceptable to Administrative Agent, on behalf of Buyers, in its sole discretion, in form and substance acceptable to Administrative Agent, on behalf of Buyers, in its sole discretion, wherein such Acceptable Attorney, Title Company or other Person described above in possession of a Purchased Asset File (i) acknowledges receipt of such Purchased Asset File, (ii) confirms that such Acceptable Attorney, Title Company or other Person acceptable to Administrative Agent, on behalf of Buyers, is holding the same as bailee or agent on behalf of Administrative Agent, on behalf of Buyers, under such letter and (iii) agrees that such Acceptable Attorney, Title Company or other Person described above shall deliver such Purchased Asset File to the Custodian, or as otherwise directed by Administrative Agent, on behalf of Buyers, by not later than the third (3rd) Business Day following the Purchase Date for the related Purchased Asset.

 

Bankruptcy Code” shall mean Title 11 of the United States Code (11 U.S.C. § 101, et. seq.), as amended, modified or replaced from time to time.

 

Benchmark” shall mean, initially, either (x) LIBOR (provided, that LIBOR shall only be permitted as a Benchmark for Purchased Assets with Purchase Dates on or prior to December 31, 2021 (any such asset a “LIBOR Purchased Asset”), after which the Benchmark shall be Term SOFR) or (y) Term SOFR, in each case as set forth in the applicable Confirmation for the subject Purchased Asset; provided, that on or prior to the date that is the Benchmark Replacement Date for LIBOR, the Benchmark for all LIBOR Purchased Assets shall be converted to Term SOFR; provided, further that at the election of Administrative Agent, in its sole discretion, the Benchmark for any Future Funding Advance for a LIBOR Purchased Asset shall be Term SOFR; provided, further that if a Benchmark Transition Event and its related Benchmark Replacement Date have occurred with respect to Term SOFR or the then-current Benchmark, then “Benchmark” means the applicable Benchmark Replacement (for purposes of clarity, for all LIBOR Purchased Assets, the Benchmark Replacement shall be deemed to be Term SOFR).

 

Benchmark Floor” shall mean the greater of (x) zero percent (0%) and (y) the floor indicated in the Confirmation for any Purchased Asset.

 

Benchmark Interim Unavailability Period” shall mean any Pricing Rate Period for which Administrative Agent, on behalf of Buyers, determines that (a) adequate and reasonable means do not exist for ascertaining the then-current Benchmark, unless and until a Benchmark Replacement has been implemented with respect thereto pursuant to Section 14(a), or (b) it is unlawful to use the then-current Benchmark to determine the applicable Price Differential.

 

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Benchmark Replacement” shall mean, with respect to any Benchmark Transition Event, the

sum of:

 

(i)
the alternate benchmark rate of interest that has been selected by Administrative Agent, on behalf of Buyers, as the replacement for the then-current Benchmark, giving due consideration to (a) any selection or recommendation of a replacement benchmark rate, or the mechanism for determining such a rate, by the Relevant Governmental Body, or (b) any evolving or then-prevailing market convention for determining a benchmark rate of interest as a replacement for the then-current Benchmark for U.S. dollar-denominated commercial real estate repurchase facilities and/or floating rate commercial mortgage loans at such time (the “Unadjusted Benchmark Replacement”), and;

 

(ii)
the Benchmark Replacement Adjustment;

 

provided that, in no event shall the Benchmark Replacement for any Pricing Rate Period be deemed to be less than the Benchmark Floor.

 

Benchmark Replacement Adjustment” shall mean, with respect to any Unadjusted Benchmark Replacement, the spread adjustment or method for calculating or determining such spread adjustment (which may be a positive or negative value or zero) that has been selected by Administrative Agent, on behalf of Buyers, giving due consideration to (a) any selection or recommendation of a spread adjustment or method for calculating or determining such spread adjustment by the Relevant Governmental Body or (b) any evolving or then-prevailing market convention for determining a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of the then-current Benchmark with the applicable Unadjusted Benchmark Replacement for U.S. dollar-denominated commercial real estate repurchase facilities and/or floating rate commercial mortgage loans at such time.

 

Benchmark Replacement Conforming Changes” shall mean, with respect to either the use or administration of LIBOR, Term SOFR or any Benchmark Replacement, any technical, administrative or operational changes (including changes to the definition of “Pricing Rate Period”, “Pricing Rate Determination Date” and “Remittance Date”, timing and frequency of determining rates and making payments of Price Differential, preceding and succeeding business day conventions and other administrative matters) that Administrative Agent, on behalf of Buyers, determines may be appropriate or necessary to reflect the adoption and implementation of such Benchmark Replacement and to permit the administration thereof by Administrative Agent in a manner substantially consistent with market practice for U.S. dollar-denominated commercial real estate repurchase facilities and/or floating rate commercial mortgage loans (or, if Administrative Agent decides that adoption of any portion of such market practice is not administratively feasible or if Administrative Agent determines that no market practice for the administration of the Benchmark Replacement exists, in such other manner of administration as Administrative Agent decides is reasonably necessary in connection with the administration of this Agreement).

 

Benchmark Replacement Date” shall mean the earliest to occur of the following events with respect to the then-current Benchmark, or each Purchased Asset, as applicable:

 

(i)
in the case of clause (i) or (ii) of the definition of “Benchmark Transition Event,” the later of (a) the date of the public statement or publication of information referenced therein and (b) the date on which the administrator of the Benchmark permanently or indefinitely ceases to provide the Benchmark; and

 

 

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(ii)
in the case of clause (iii) of the definition of “Benchmark Transition Event,” the first date on which such Benchmark has been determined and announced by the regulatory supervisor for the administrator of such Benchmark to be non-representative; provided that such non-representativeness, non-compliance or non-alignment will be determined by reference to the most recent statement or publication referenced in such clause (iii) and even if any available tenor of such Benchmark (or such component thereof) continues to be provided on such date; and

 

(iii)
in the case of clause (iv) of the definition of “Benchmark Transition Event,” the date of such adoption or change in any Requirement or Law of in the interpretation or application thereof as determined by Administrative Agent in its sole discretion.

 

Benchmark Transition Event” shall mean the occurrence of one or more of the following events with respect to the then-current Benchmark for each Purchased Asset, as applicable:

 

(i)
a public statement or publication of information by or on behalf of the administrator of the Benchmark announcing that such administrator has ceased or will cease to provide the Benchmark, permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide the Benchmark;

 

(ii)
a public statement or publication of information by the regulatory supervisor for the administrator of the Benchmark, the central bank for the currency of the Benchmark, an insolvency official with jurisdiction over the administrator for the Benchmark, a resolution authority with jurisdiction over the administrator for the Benchmark or a court or an entity with similar insolvency or resolution authority over the administrator for the Benchmark, which states that the administrator of the Benchmark has ceased or will cease to provide the Benchmark permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide the Benchmark;

 

(iii)
a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark announcing that the Benchmark is not, or as of a specified future date will not be, representative; or

 

(iv)
the adoption of or any change in any Requirement of Law or in the interpretation or application thereof that makes it unlawful for any Purchased Asset to accrue Price Differential based on the then-current Benchmark for such Purchased Asset.

 

Breakage Costs” shall have the meaning set forth thereto in Article 14(f).

 

Business Day” shall mean a day other than (i) a Saturday or Sunday, or (ii) a day in which the New York Stock Exchange or banks in the State of New York are authorized or obligated by law or executive order to be closed. Notwithstanding the foregoing sentence, when used with respect to the determination of LIBOR, “Business Day” shall only be a day on which commercial banks are open for international business (including dealings in U.S. Dollar deposits) in London, England.

 

Buyer” and “Buyers” shall mean (i) Goldman Sachs Bank USA, a New York state-chartered bank, in its capacity as buyer hereunder, together with its permitted successors and assigns and (ii) such other financial institutions from time to time party hereto and their respective successors and assigns.

 

Buyer’s LTV” shall mean, on any date, with respect to any Purchased Asset, the quotient (expressed as a percentage) of (i) the then outstanding Purchase Price of such Purchased Asset divided by

 

 

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(ii)
the value of the related Underlying Mortgaged Property as determined by Administrative Agent, on behalf of Buyers, in its sole discretion.

 

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

 

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

 

Cause” shall mean, with respect to an Independent Director, (a) acts or omissions by such Independent Director that constitute willful disregard of, or bad faith or gross negligence with respect to, the Independent Director’s duties with respect to Seller’s obligations under this Agreement, (b) such Independent Director has engaged in or has been charged with, or has been convicted of, fraud or other acts constituting a crime under any law applicable to such Independent Director, (c) such Independent Director is unable to perform his or her duties as Independent Director due to death, disability or incapacity, or (d) such Independent Director no longer meets the definition of Independent Director, as that term is defined in this Article 2.

 

Change of Control” shall mean the occurrence of any of the following events:

 

(a)
prior to a Public Listing or Public Sale of Guarantor:

 

(i)
Claros Manager ceases to perform its obligation under the Claros Management Agreement; provided that if Guarantor’s management is “internalized”, whether by acquisition of, or merger or other combination with, Claros Manager, or otherwise, such internalization shall not be deemed to be a “transfer” subject to this subsection (i);

 

(ii)
Guarantor shall cease to own and control, of record and beneficially, directly or indirectly, 100% of each class of the outstanding Capital Stock of Seller;

 

(iii)
any time that less than two (2) of the following four (4) Persons continue to be actively and directly involved in the management and policies of Guarantor: (1) Richard Mack,

(2) Michael McGillis, (3) Kevin Cullinan and (4) Priyanka Garg;

 

(iv)
a Transfer, whether directly or indirectly through its direct or indirect Subsidiaries, of all or substantially all of Seller’s or Guarantor’s assets (excluding (a) any Transfer or Transfers by or among Guarantor, Seller and any Subsidiary or Subsidiaries (other than any Purchased Asset) and (b) any Transfer in connection with any securitization transaction or repurchase or other similar transaction in the ordinary course of Seller’s or Guarantor’s business); or

 

(b)
following a Public Listing or Public Sale of Guarantor, the following shall occur with respect to the applicable Public Vehicle:

 

(i)
any transfer of all or substantially all of the assets of Guarantor to a Person that is not managed by Claros Manager, except for a securitization conducted or contributed to by

 

 

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Guarantor in the ordinary course of business; provided that if Guarantor’s management is “internalized”, whether by acquisition of, or merger or other combination with, Claros Manager, or otherwise, such internalization shall not be deemed to be a “transfer” subject to this subsection (i);

 

(ii)
the consummation of any transaction (including, without limitation, any merger or consolidation) the result of which is that any person, other than Claros Manager or a Permitted Holder, becomes the beneficial owner (as defined in Rules 13d-3 and 13d-5 under the 1934 Act), directly or indirectly, of more than 35% on a fully diluted basis (excluding Affiliates) of the Public Vehicle’s outstanding Voting Stock or other Voting Stock into which the Public Vehicle’s Voting Stock is reclassified, consolidated, exchanged or changed, measured by voting power rather than number of shares;

 

(iii)
the Public Vehicle consolidates with, or merges with or into, any person, or any person consolidates with, or merges with or into, the Public Vehicle, in any such event pursuant to a transaction in which any of the Public Vehicle’s outstanding Voting Stock or the Voting Stock of such other person is converted into or exchanged for cash, securities or other property, other than any such transaction where the shares of the Public Vehicle’s Voting Stock outstanding immediately prior to such transaction constitute, or are converted into or exchanged for, a majority of the Voting Stock of the surviving person or any direct or indirect parent company of the surviving person immediately after giving effect to such transaction; or

 

(iv)
the adoption of a plan relating to the Public Vehicle’s liquidation or dissolution. The term “person,” as used in this definition, has the meaning given thereto in Section 13(d)(3) of the 1934 Act.

 

For the avoidance of doubt, neither a Public Listing nor a Public Sale of Guarantor shall be deemed a Change of Control.

 

Claros Management Agreement” shall mean that certain Amended and Restated Management Agreement dated as of July 8, 2016, by and between Claros Mortgage Trust, Inc. and Claros Manager.

 

Claros Manager” shall mean Claros REIT Management LP, a Delaware limited partnership, together with its successors and assigns.

 

Closing Date” shall mean the date of this Agreement.

 

Co-Buyer Agreement” shall mean, collectively, (i) any co-buyer agreements entered into among Administrative Agent and one or more Buyers in connection with the Transactions and the Transaction Documents and (ii) any participation agreements entered into among Administrative Agent, one or more Buyers and any Participants in connection with the Transactions and the Transaction Documents, as each may be amended, modified and/or restated from time to time.

 

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

 

Collection Period” shall mean (i) with respect to the first Remittance Date, the period beginning on and including the Closing Date and continuing to and including the calendar day immediately preceding such Remittance Date, and (ii) with respect to each subsequent Remittance Date, the period beginning on and including the immediately preceding Remittance Date and continuing to and including the calendar day immediately preceding the following Remittance Date.

 

 

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Concentration Limit” shall mean, the following amounts or maximum percentage concentration limits based, where applicable, in each case, as of any date of determination, on the aggregate Purchase Price or individual Purchase Price for the applicable Purchased Asset(s), as the case may be, as a percentage of the Maximum Facility Amount:

 

(i)
as of any date of determination, for all Purchased Assets for which the Underlying Mortgaged Property consists of hospitality properties, thirty-five percent (35%);

 

(ii)
as of any date of determination, for all Purchased Assets for which the Underlying Mortgaged Property consists of retail shopping malls, thirty-five percent (35%);

 

(iii)
as of any date of determination, except with respect to Purchased Assets for which the Underlying Mortgaged Property consists of hospitality properties, for all Purchased Assets for which the Underlying Mortgaged Property consists of a single property type (e.g. mixed-use, multi- family, office, retail, industrial, hospitality or warehouse properties), sixty percent (60%); and

 

(iv)
for any single Purchased Asset as of the related Purchase Date, not less than

$10,000,000.00 or greater than $100,000,000.00.

 

Confirmation” shall mean a written confirmation in the form of Exhibit I, duly completed, executed and delivered by Administrative Agent, on behalf of Buyers, and Seller.

 

Connection Income Taxes” shall mean Other Connection Taxes that are imposed on or measured by net income (however denominated) or that are franchise Taxes or branch profits Taxes.

 

Control” shall mean, with respect to any Person, the possession of the direct or indirect power to direct or cause the direction of the management or policies of such Person, whether through the ability to exercise voting power, by contract or otherwise. “Control”, “Controlling”, “Controlled” and “under common Control” shall have correlative meanings.

 

Covenant Compliance Certificate” shall mean a properly completed and executed Covenant Compliance Certificate in form and substance of the certificate attached hereto as Exhibit IX.

 

Custodial Agreement” shall mean the Amended and Restated Custodial Agreement, dated as of the date hereof, by and among the Custodian, Seller and Administrative Agent, on behalf of Buyers, as amended, modified and/or restated from time to time.

 

Custodial Delivery Certificate” shall mean the form executed by Seller in order to deliver the Purchased Asset Schedule and the Purchased Asset File to Administrative Agent, on behalf of Buyers, or its designee (including the Custodian) pursuant to Article 7 of this Agreement, a form of which is attached hereto as Exhibit XIV.

 

Custodian” shall mean Wells Fargo Bank, N.A., or any successor Custodian appointed by Administrative Agent, on behalf of Buyers, and reasonably acceptable to Seller, or appointed by Administrative Agent, on behalf of Buyers, in its sole discretion during the continuance of an Event of Default.

 

Delivery Failure” shall have the meaning set forth in the Bailee Letter.

 

Depository” shall mean JPMorgan Chase Bank, N.A., or any successor Depository appointed by Administrative Agent, on behalf of Buyers, in its sole discretion and reasonably acceptable to Seller, or

 

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appointed by Administrative Agent, on behalf of Buyers, in its sole discretion during the continuance of an Event of Default.

 

Depository Account” shall mean a segregated account, in the name of Seller, in trust for Administrative Agent, on behalf of Buyers, established at Depository in accordance with this Agreement, and which is subject to the Depository Agreement.

 

Depository Agreement” shall mean that certain Amended and Restated Deposit Account Control Agreement, dated as of the date hereof, among Administrative Agent, on behalf of Buyers, Seller and Depository, as amended, modified and/or restated from time to time.

 

Draw Fee” shall have the meaning set forth in the Fee Letter, which definition is incorporated herein by reference.

 

Due Diligence Package” shall have the meaning set forth in Exhibit VI to this Agreement.

 

Early Repurchase Date” shall have the meaning set forth in Article 3(f)(i) of this Agreement.

 

Electronic Signature” shall have the meaning specified in Article 31(b) of this Agreement.

 

Eligible Assets” shall mean any of the following types of assets or loans (a) that are acceptable to Administrative Agent, on behalf of Buyers, in its sole discretion (determined as of the relevant Purchase Date), (b) with respect to which as of the related Purchase Date the representations and warranties set forth in this Agreement (including the exhibits hereto) are true and correct in all respects except to the extent disclosed in a Requested Exceptions Report approved by Administrative Agent, on behalf of Buyers, and (c) where the Underlying Mortgaged Property consists of mixed-use, multi-family, office, retail, industrial, hospitality or warehouse properties or such other types of properties that Administrative Agent, on behalf of Buyers, may agree to in its sole discretion that are located in the United States of America, its territories or possessions (or elsewhere, in the sole discretion of Administrative Agent, on behalf of Buyers):

 

(i)
Senior Mortgage Loans; and

 

(ii)
any other asset or loan types or classifications that are acceptable to Administrative Agent, on behalf of Buyers, subject to its consent on all necessary and appropriate modifications to this Agreement and each of the Transaction Documents, as determined by Administrative Agent, in its sole discretion.

 

Notwithstanding anything to the contrary contained in this Agreement, the following shall not be Eligible Assets for purposes of this Agreement: (i) non-performing loans; (ii) any Asset, where payment of the Purchase Price with respect thereto would cause the aggregate of all Purchase Prices to exceed the Maximum Facility Amount; (iii) loans for which, the applicable Appraisal is not dated within one hundred eighty (180) calendar days of the proposed Purchase Date (or such other time period as approved by Administrative Agent, on behalf of Buyers, in Administrative Agent’s sole discretion); (iv) loans in which the related loan agreement or other documents and/or instruments evidencing such loans contain restrictions on assignment by the lender; (v) Assets that, upon becoming a Purchased Asset, would cause the Purchase Price of the applicable Purchased Asset or the aggregate Purchase Price of the applicable Purchased Assets to violate the Concentration Limit; (vi) construction loans or land loans (provided, that, loans allowing for advances relating to tenant improvement buildouts or renovations may be permitted);

(vii) Assets that, upon becoming a Purchased Asset, have a Mortgaged Property LTV greater than seventy-five percent (75%); and (viii) Assets that are not secured by cash-flowing Underlying Mortgaged

 

 

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Properties, provided that Administrative Agent, on behalf of Buyers, may consider an Asset that is secured by a non cash-flowing Underlying Mortgaged Property in its sole discretion on a case-by-case basis.

 

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

U.S.C. § 1801 et seq. and the Occupational Safety and Health Act, 29 U.S.C. § 651 et seq.; and any state and local or foreign counterparts or equivalents, in each case as amended from time to time.

 

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

 

ERISA Affiliate” shall mean any corporation or trade or business that is a member of any group of organizations (i) described in Article 414(b) or (c) of the Code of which Seller is a member and (ii) solely for purposes of potential liability under Article 302(c)(11) of ERISA and Article 412(c)(11) of the Code and the lien created under Article 302(f) of ERISA and Article 412(n) of the Code, described in Article 414(m) or (o) of the Code of which Seller is a member.

 

Erroneous Payment” shall have the meaning set forth in Article 30(d)(i) of this Agreement.

 

Event of Default” shall have the meaning set forth in Article 13 of this Agreement.

 

Excluded Taxes” shall mean any of the following Taxes imposed on or with respect to any Recipient or any Transferee, or required to be withheld or deducted from a payment to any Recipient or Transferee, (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result of any Recipient or Transferee being organized under the laws of or having its principal office, or its applicable lending office located in the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) U.S. federal withholding Taxes imposed on amounts payable to or for the account of such Recipient or Transferee under this Agreement pursuant to a law in effect on the date on which (i) such Recipient or Transferee acquires an interest hereunder (other than pursuant to an assignment request by Seller under Article 14(m)) or (ii) such Recipient or Transferee changes its lending office, except in each case to the extent that, pursuant to Articles 14(g) and 14(j), amounts with respect to such Taxes were payable either to Recipient’s or Transferee’s assignor immediately before such Recipient or Transferee acquired an interest hereunder or to such Recipient or Transferee immediately before it changed its lending office, (c) Taxes attributable to such Recipient or Transferee’s failure to comply with Article 14(k) and (d) any U.S. federal withholding Taxes imposed under FATCA.

 

Exit Fee” shall have the meaning set forth in the Fee Letter, which definition is incorporated herein by reference.

 

 

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FATCA” shall mean Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof and any agreements entered into pursuant to Section 1471(b)(1) of the Code, and any fiscal or regulatory legislation, rules or official practices implementing any intergovernmental agreement in connection thereto.

 

FATF” shall have the meaning set forth in the definition of “Prohibited Investor.”

 

FDIA” shall have the meaning set forth in Article 23(c) of this Agreement.

 

FDICIA” shall have the meaning set forth in Article 23(e) of this Agreement.

 

Federal Funds Rate” shall mean, for any day, an interest rate per annum equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published on the next succeeding Business Day by the Federal Reserve Bank of New York, or, if such rate is not so published for any day that is a Business Day, the average of the quotations at approximately 10:00 a.m. (New York time) on such day or such transactions received by Administrative Agent from three (3) federal funds brokers of recognized standing selected by Administrative Agent in its sole discretion.

 

Fee Letter” shall mean that certain Amended and Restated Fee Letter, dated as of the date hereof, between Administrative Agent, on behalf of Buyers, and Seller, as amended, modified and/or restated from time to time.

 

Filings” shall have the meaning set forth in Article 6(c) of this Agreement.

 

Financing Lease” shall mean any lease of property, real or personal, the obligations of the lessee in respect of which are required in accordance with GAAP to be capitalized on a balance sheet of the lessee.

 

Force Majeure Event” shall mean any of the following: (a) there has occurred and is continuing an outbreak of significant hostilities or escalation thereof or other calamity or crisis the effect of which is that, in the reasonable judgment of Administrative Agent, it is impossible or commercially inadvisable to continue to enter into transactions in the repurchase (or “repo”) market or financing market with respect to assets similar to Eligible Assets, (b) a banking moratorium has been declared and is continuing under federal law, New York law or by federal or New York Governmental Authorities or other applicable authorities, (c) a general suspension of trading on nationally-recognized stock exchanges has occurred or (d) Administrative Agent, on behalf of Buyers, is and continues to be prohibited, as a result of any Requirement of Law, from entering into transactions similar to those contemplated under the Transaction Documents.

 

Foreign Buyer” shall mean (a) if the Seller is a U.S. Person, a Buyer that is not a U.S. Person, and (b) if the Seller is not a U.S. Person, a Buyer that is resident or organized under the laws of a jurisdiction other than that in which the Seller is resident for tax purposes.

 

Future Funding Advance” shall have the meaning set forth in Article 3(l) of this Agreement.

 

Future Funding Due Diligence Package” shall have the meaning set forth in Exhibit XVI

hereto.

 

 

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GAAP” shall mean United States generally accepted accounting principles consistently applied as in effect from time to time.

 

Governmental Authority” shall mean any national or federal government, any state, regional, local or other political subdivision thereof with jurisdiction and any Person with jurisdiction exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to any such government or subdivision thereof (including any supra-national bodies such as the European Union or the European Central Bank).

 

GSBUSA” shall mean Goldman Sachs Bank USA, a New York state-chartered bank, in its capacity as buyer hereunder, together with its permitted successors and assigns.

 

Guarantee Agreement” shall mean the Amended and Restated Guarantee Agreement, dated as of the date hereof, from Guarantor in favor of Administrative Agent, on behalf of Buyers, and as amended, restated, supplemented or otherwise modified and in effect from time to time.

 

Guarantor” shall mean Claros Mortgage Trust, Inc., a Maryland corporation.

 

Income” shall mean, with respect to any Purchased Asset at any time, (a) any collections of principal, interest, dividends, receipts or other distributions or collections and (b) all net sale proceeds received by Seller or any Affiliate of Seller in connection with a sale or liquidation of such Purchased Asset.

 

Indebtedness” shall mean, for any Person, (a) obligations created, issued or incurred by such Person for borrowed money (whether by loan, the issuance and sale of debt securities or the sale of property to another Person subject to an understanding or agreement, contingent or otherwise, to repurchase such property from such Person); (b) obligations of such Person to pay the deferred purchase or acquisition price of property or services, other than trade accounts payable (other than for borrowed money) arising, and accrued expenses incurred, in the ordinary course of business so long as such trade accounts payable are payable within sixty (60) calendar days of the date the respective goods are delivered or the respective services are rendered; (c) Indebtedness of others secured by a Lien on the property of such Person, whether or not the respective Indebtedness so secured has been assumed by such Person; (d) obligations (contingent or otherwise) of such Person in respect of letters of credit or similar instruments issued or accepted by banks and other financial institutions for account of such Person; (e) obligations of such Person under repurchase agreements, sale/buy-back agreements or like arrangements;

(f) Indebtedness of others guaranteed by such Person; (g) all obligations of such Person incurred in connection with the acquisition or carrying of fixed assets by such Person; (h) Indebtedness of general partnerships of which such Person is secondarily or contingently liable (other than by endorsement of instruments in the course of collection), whether by reason of any agreement to acquire such indebtedness to supply or advance sums or otherwise; (i) Capitalized Lease Obligations of such Person; (j) all net liabilities or obligations under any interest rate, interest rate swap, interest rate cap, interest rate floor, interest rate collar, or other hedging instrument or agreement; and (k) all obligations of such Person under Financing Leases.

 

Indemnified Amounts” and “Indemnified Parties” shall have the meaning set forth in Article 27 of this Agreement.

 

Indemnified Taxes” shall mean (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of Seller under any Transaction Document and (b) to the extent not otherwise described in clause (a) of this definition, Other Taxes.

 

 

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Independent Appraiser” shall mean an independent professional real estate appraiser who is a member in good standing of the American Appraisal Institute, and, if the state in which the subject Underlying Mortgaged Property is located certifies or licenses appraisers, is certified or licensed in such state, and in each such case, who has a minimum of five (5) years’ experience in the subject property type.

 

Independent Director” shall mean an individual with at least three (3) years of employment experience serving as an independent director at the time of appointment who is provided by, and is in good standing with, CT Corporation, Corporation Service Company, National Registered Agents, Inc., Wilmington Trust Company, Stewart Management Company, Lord Securities Corporation or, if none of those companies is then providing professional independent directors or managers or is not acceptable to the Rating Agencies, another nationally recognized company reasonably approved by Administrative Agent, on behalf of Buyers, in each case that is not an Affiliate of Seller and that provides professional independent directors or managers and other corporate services in the ordinary course of its business, and which individual is duly appointed as a member of the board of directors or board of managers of Seller and is not, and has never been, and will not while serving as independent director or manager be:

 

(a)
a member (other than an independent, non-economic “springing” member), partner, equityholder, manager, director, officer or employee of Seller or Seller’s equityholders or Affiliates (other than as an independent director or manager of an Affiliate of Seller that is not in the direct chain of ownership of Seller and that is required by a creditor to be a Single Purpose Entity, provided that such independent director or manager is employed by a company that routinely provides professional independent directors or managers in the ordinary course of business);

 

(b)
a customer, creditor, supplier or service provider (including provider of professional services) to Seller or Seller’s equityholders or Affiliates (other than a nationally recognized company that routinely provides professional independent directors or managers and other corporate services to Seller or Seller’s equityholders or Affiliates in the ordinary course of business);

 

(c)
a family member of any such member, partner, equityholder, manager, director, officer, employee, customer, creditor, supplier or service provider; or

 

(d)
a Person that controls or is under common control with (whether directly, indirectly or otherwise) any of (a), (b) or (c) above.

 

A natural person who otherwise satisfies the foregoing definition other than subparagraph (a) by reason of being the independent director or manager of a single purpose bankruptcy remote entity in the direct chain of ownership of Seller shall not be disqualified from serving as an independent director or manager of Seller, provided that the fees that such individual earns from serving as independent directors or managers of such Affiliates in any given year constitute in the aggregate less than five percent (5%) of such individual’s annual income for that year.

 

Investment Company Act” shall have the meaning set forth in Article 9(b)(xv) of this Agreement.

 

IRS” shall mean the United States Internal Revenue Service.

 

Knowledge” shall mean shall mean, as of any date of determination, collectively, (i) the actual knowledge after due inquiry of any Responsible Officer or employee of Seller or an Affiliate and (ii) all

 

 

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knowledge that is imputed to a Person under any statute, rule, regulation, ordinance, or official decree or order. “Known”, “Knowingly” or other variations of Knowledge shall have meanings correlative thereto.

 

LIBOR” shall mean, with respect to each Pricing Rate Period, the rate determined by Administrative Agent, on behalf of Buyers, to be (i) the per annum rate for one (1) month deposits in U.S. dollars, which appears on the Reuters Screen LIBOR01 Page (or any successor thereto) as the London Interbank Offering Rate as of the Reference Time (rounded upwards, if necessary, to the nearest 1/1000 of 1%); (ii) if such rate does not appear on said Reuters Screen LIBOR01 Page, the arithmetic mean (rounded as aforesaid) of the offered quotations of rates obtained by Administrative Agent, on behalf of Buyers, from the Reference Banks for one (1) month deposits in U.S. dollars to prime banks in the London Interbank market as of approximately the Reference Time and in an amount that is representative for a single transaction in the relevant market at the relevant time; or (iii) if fewer than two (2) Reference Banks provide Administrative Agent with such quotations, the rate per annum which Administrative Agent determines to be the arithmetic mean (rounded as aforesaid) of the offered quotations of rates which major banks in New York, New York selected by Administrative Agent, on behalf of Buyers, are quoting at approximately 11:00 a.m., New York City time, on the Pricing Rate Determination Date for loans in U.S. dollars to leading European banks for a period equal to the applicable Pricing Rate Period in amounts of not less than $1,000,000.00; provided, that such selected banks shall be the same banks as selected for all of Administrative Agent’s other customers where LIBOR is to be applied, to the extent such banks are available. Administrative Agent’s determination of LIBOR shall be binding and conclusive on Seller absent manifest error. LIBOR may or may not be the lowest rate based upon the market for U.S. dollar deposits in the London Interbank Eurodollar Market at which Administrative Agent, on behalf of Buyers, prices loans on the date which LIBOR is determined by Administrative Agent as set forth above. Notwithstanding the foregoing, in no event will LIBOR be deemed to be less than: (A) with respect to Transactions where the Purchase Date was before May 27, 2021, thirty-five hundredths percent (0.35%) and (B) with respect to any Transaction where the Purchase Date is on or after May 27, 2021, the Benchmark Floor.

 

LIBOR Purchased Asset” shall have the meaning set forth in the definition of “Benchmark”.

 

LIBOR Rate” shall mean, as of any date of determination, a rate per annum determined in accordance with the following formula (rounded upward to the nearest 1/100th of 1%):

 

LIBOR

1 Reserve Requirement

 

Lien” shall mean any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), charge or other security interest or any preference, priority or other security agreement or preferential arrangement of any kind or nature whatsoever (including, without limitation, any conditional sale or other title retention agreement and any Financing Lease having substantially the same economic effect as any of the foregoing), and the filing of any financing statement under the UCC or comparable law of any jurisdiction in respect of any of the foregoing.

 

Mandatory Early Repurchase Date” shall have the meaning set forth in Article 3(f)(ii).

 

Mandatory Early Repurchase Event” shall mean, one or more of the following with respect to any Purchased Asset: (i) a monetary “event of default” under any Purchased Asset beyond any applicable notice and cure period; (ii) any material non-monetary event of default beyond any applicable cure periods under any Purchased Asset Documents; (iii) breach of any representation contained in Article 9(b)(x), as determined by Administrative Agent, on behalf of Buyers, in its sole reasonable discretion

 

 

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(except as disclosed in a Requested Exceptions Report and as approved by Administrative Agent in writing); (iv) an Act of Insolvency has occurred with respect to the related Mortgagor or guarantor under such Purchased Asset (subject to any typical grace and cure periods for “insolvency events” contained in the Purchased Asset Documents); (v) Seller’s failure to repurchase any Purchased Asset on the applicable Repurchase Date; (vi) Seller (or any of its Affiliates) shall fail to satisfy any of its material obligations under such Purchased Asset Documents beyond any applicable cure periods; (vii) any participant or co- lender under any related loan pari passu with or senior to such Purchased Asset or the Underlying Mortgaged Property shall be delinquent in the payment of amounts due under the related loan documents;

(viii) a voluntary or involuntary bankruptcy petition is filed with respect to any participant or co-lender under any related loan pari passu or senior to the related Purchased Asset or the Underlying Mortgaged Property (subject to typical grace and cure periods for “insolvency events”); (ix) failure to deliver the related Purchased Asset File to Custodian in accordance with the Custodial Agreement (subject to any Bailee Agreement approved by Administrative Agent, on behalf of Buyers, in accordance with the terms and provisions of this Agreement on the related Purchased Date); (x) the related Purchased Asset File or any portion thereof is subject to a continuing Delivery Failure or has been released from the possession of Custodian under the Custodial Agreement to anyone other than Administrative Agent, on behalf of Buyers, or any Affiliate of Administrative Agent, on behalf of Buyers, except in accordance with the terms of the Custodial Agreement; (xi) such Purchased Asset fails to qualify for “safe harbor” treatment as described in Article 23; or (xii) any significant decline, as determined by Administrative Agent, on behalf of Buyers, in its sole reasonable discretion, in the financial condition or credit quality of any sponsor with respect to such Purchased Asset.

 

Margin Amount” shall mean, with respect to any Purchased Asset on any date, an amount equal to (a) the lesser of (i) the unpaid principal balance of such Purchased Asset and (ii) the Market Value of such Purchased Asset, multiplied by (b) the Advance Rate for such Purchased Asset.

 

Margin Deficit” shall mean an amount determined by Administrative Agent, on behalf of Buyers, in its sole discretion, as follows, provided that the largest amount as calculated in accordance with clauses (i), (ii) and (iii) shall control:

 

(i)
with respect to any Margin Deficit Event described in clause (i) of the definition of “Margin Deficit Event”, the Margin Deficit for the applicable Purchased Asset shall be an amount equal to the positive difference (if any) between (A) the outstanding Purchase Price of such Purchased Asset and (B) the Margin Amount for such Purchased Asset, provided, however, that, if the Market Value of such Purchased Asset has declined by thirty percent (30%) or more from par (adjusted for any Principal Payment received with respect to such Purchased Asset), then the Margin Deficit for such Purchased Asset shall include an additional amount equal to the absolute dollar amount of such decline in Market Value that exceeds thirty percent (30%) from par, as determined by Administrative Agent, on behalf of Buyers, in its sole discretion;

 

(ii)
with respect to any Margin Deficit Event described in clause (ii) of the definition of “Margin Deficit Event”, the Margin Deficit for the applicable Purchased Asset shall be equal to an amount which, after payment of such Margin Deficit, will cause the Purchase Price Debt Yield to be equal to the Minimum Purchase Price Debt Yield; and

 

(iii)
with respect to any Margin Deficit Event described in clause (iii) of the definition of “Margin Deficit Event”, the Margin Deficit for the applicable Purchased Asset shall be equal to an amount which, after payment of such Margin Deficit, will result in a Buyer’s LTV for the applicable Purchased Asset equal to the Buyer’s LTV on the Purchase Date of such Purchased Asset.

 

 

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Margin Deficit Event” shall mean the occurrence or existence of any of the following, as determined by Administrative Agent, on behalf of Buyers, in its sole discretion:

 

(i)
a decline in the Market Value of any Purchased Asset by twenty percent (20%) or more from par, as determined by Administrative Agent, in its sole discretion;
(ii)
as of each anniversary of the Purchase Date, with respect to any Purchased Asset, the Purchase Price Debt Yield is less than the Minimum Purchase Price Debt Yield; and/or
(iii)
the Buyer’s LTV of any Purchased Asset is equal to or greater than the Maximum Buyer’s LTV of such Purchased Asset.

Margin Deficit Notice” shall have the meaning set forth in Article 4(a).

 

Market Disruption Event” shall mean either (a) any event or events shall have occurred in the determination of Administrative Agent resulting in the effective absence of a “repo market” or related “lending market” for purchasing (subject to repurchase) or financing debt obligations secured by commercial mortgage loans or securities or an event or events shall have occurred resulting in Administrative Agent or Buyers not being able to finance Eligible Assets through the “repo market” or “lending market” with traditional counterparties at rates which would have been reasonable prior to the occurrence of such event or events, or (b) any event or events shall have occurred resulting in the effective absence of a “securities market” for securities backed by Eligible Assets, including, but not limited to the “CMBS/CDO/CLO market”, or an event or events shall have occurred resulting in Administrative Agent, on behalf of Buyers, not being able to sell securities backed by Eligible Assets at prices which would have been reasonable prior to such event or events, in each case as determined by Administrative Agent.

 

Market Value” shall mean, with respect to any Purchased Asset as of any relevant date, the market value of such Purchased Asset on such date, as determined by Administrative Agent in its sole discretion. The Market Value of each Purchased Asset may be determined by Administrative Agent on each Business Day during the term of this Agreement.

 

Material Adverse Effect” shall mean a material adverse effect on (a) the property, business, operations, financial condition, credit quality or prospects of Seller, Pledgor, and/or Guarantor, taken as a whole (b) the ability of Seller, Pledgor or Guarantor to perform its obligations under any of the Transaction Documents, (c) the validity or enforceability of any of the Transaction Documents, (d) the rights and remedies of Buyers under any of the Transaction Documents, (e) the timely payment of any amounts payable under the Transaction Documents, or (f) the Market Value, rating (if applicable) or liquidity of all of the Purchased Assets in the aggregate.

 

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

 

Maximum Advance Rate” shall mean, with respect to each Purchased Asset, seventy-five percent (75%) of the outstanding principal balance of such Purchased Asset.

 

Maximum Buyer’s LTV” shall mean, with respect to each Purchased Asset, the sum of (a) the Buyer’s LTV for such Purchased Asset as of the related Purchase Date plus (b) five percent (5%).

 

 

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Maximum Facility Amount” shall mean Seven Hundred Fifty Million Dollars ($750,000,000.00).

 

Minimum Purchase Price Debt Yield” shall mean, as of each Purchase Date, an amount equal to the product of (i) ninety percent (90%) and (ii) the Purchase Date Purchase Price Debt Yield as of such applicable date.

 

Monthly Reporting Package” shall mean the reporting package described on Exhibit III-A.

 

Mortgage” shall mean a mortgage, deed of trust, deed to secure debt, charge or other instrument, creating a valid and enforceable first Lien on or a first priority ownership interest in an estate in fee simple or term of years in real property and the improvements thereon, securing evidence of indebtedness.

 

Mortgage Note” shall mean a note or other evidence of indebtedness of a Mortgagor with respect to a Senior Mortgage Loan.

 

Mortgaged Property LTV” shall mean, with respect to any Purchased Asset, the ratio of the aggregate outstanding principal balance of such Purchased Asset (which shall include such Purchased Asset and all debt senior to or pari passu with such Purchased Asset) secured, directly or indirectly, by the related Underlying Mortgaged Property, to the aggregate “as-is” market value of such Underlying Mortgaged Property as determined by Administrative Agent in its sole discretion.

 

Mortgagor” shall mean the obligor on a Mortgage Note and the grantor of the related Mortgage.

 

Multiemployer Plan” shall mean a multiemployer plan defined as such in Article 3(37) of ERISA to which contributions have been, or were required to have been, made by Seller or any ERISA Affiliate and that is covered by Title IV of ERISA.

 

New Asset” shall mean an Eligible Asset that Seller proposes to be included as a Purchased Item which Eligible Asset has not yet become a Purchased Asset.

 

OFAC” shall have the meaning specified in the definition of “Prohibited Investor”.

 

Original Master Repurchase Agreement” shall have the meaning specified in recitals hereof.

 

Originated Asset” shall mean any Eligible Asset originated by an Affiliate of Seller.

 

Other Connection Taxes” shall mean, with respect to any Recipient and any Transferee, Taxes imposed as a result of a present or former connection between such Recipient or Transferee and the jurisdiction imposing such Tax (other than connections arising from such Recipient or Transferee having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Transaction Document, or sold or assigned an interest in any Transaction Document).

 

Other Taxes” shall mean all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, any Transaction Document, except for (i) any such Taxes or Other Connection Taxes imposed with respect to an assignment, transfer or sale of participation or other interest in or with

 

 

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respect to the Transaction Documents (other than an assignment made pursuant to Article 14(m)), and (ii) for the avoidance of doubt, any Excluded Taxes.

 

Participant Register” shall have the meaning set forth in Article 19(c) of this Agreement.

 

Participants” shall have the meaning set forth in Article 19(a) of this Agreement.

 

Payment Notice” shall have the meaning set forth in Article 30(d)(ii) of this Agreement.

 

Permitted Encumbrances” shall mean, with respect to each Purchased Asset, (a) any lien or security interest created by this Agreement and the other Transaction Documents, (b) all liens, encumbrances and other matters disclosed in the applicable Title Policy, (c) liens, if any, for Taxes imposed by an Governmental Authority not yet due or delinquent, (d) leases, equipment leases, or other similar instruments entered into in accordance with the Purchased Asset Documents, (e) mechanics’ liens, materialmen’s liens and other recorded encumbrances which are being contested in accordance with the Purchased Asset Documents, bonded over, escrowed for or insured against by the applicable Title Policy.

 

Permitted Holders” shall mean, with respect to Guarantor, any Person owning Capital Stock in Guarantor (i) as of the Closing Date, (ii) that is managed by Claros Manager or (iii) that has been approved in writing by Administrative Agent, on behalf of Buyers, in Administrative Agent’s sole and absolute discretion, prior to the date of such Person’s acquisition of such Capital Stock in Guarantor.

 

Person” shall mean an individual, corporation, limited liability company, business trust, partnership, joint tenant or tenant in common, trust, joint stock company, joint venture, unincorporated organization, or any other entity of whatever nature, or a Governmental Authority.

 

Plan” shall mean an employee pension benefit plan (within the meaning of Section 3(2) of ERISA) established or maintained by Seller or any ERISA Affiliate during the five year period ended prior to the date of this Agreement or to which Seller or any ERISA Affiliate makes, is obligated to make or has, within the five year period ended prior to the date of this Agreement, been required to make contributions and that is covered by Title IV of ERISA or Article 302 of ERISA or Article 412 of the Code, other than a Multiemployer Plan.

 

Plan Asset Regulations” shall mean the regulations promulgated at 29 C.F.R. Section 2510.3- 101, as modified by Section 3(42) of ERISA.

 

Plan Party” shall have the meaning set forth in Article 22(a) of this Agreement.

 

Pledge and Security Agreement” shall mean that certain Amended and Restated Pledge and Security Agreement, dated as of the date hereof, by Pledgor in favor of Administrative Agent, on behalf of Buyers, as the same may be amended, restated, supplemented, replaced or otherwise modified from time to time, pledging all of Pledgor’s interest in the Capital Stock of Seller to Administrative Agent, on behalf of Buyers.

 

Pledgor” shall mean CMTG GS Finance Holdco LLC, a Delaware limited liability company.

 

Potential Event of Default” shall mean any condition or event that, after notice or lapse of time, would constitute an Event of Default.

 

Pre-Existing Asset” shall mean any Eligible Asset that is not an Originated Asset.

 

 

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Pre-Purchase Due Diligence” shall have the meaning set forth in Article 3(b) hereof.

 

Pre-Purchase Legal Expenses” shall mean all of the reasonable and necessary out of pocket legal fees, costs and expenses incurred by Administrative Agent, on behalf of Buyers, in connection with the Pre-Purchase Due Diligence associated with Administrative Agent’s, on behalf of Buyers, decision as to whether or not to enter into a particular Transaction.

 

Prescribed Laws” shall mean, collectively, (a) the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (Public Law 107- 56) (the “USA Patriot Act”), (b) Executive Order 13224 on Terrorist Financing, effective September 24, 2001, and relating to Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism, (c) the International Emergency Economic Power Act, 50

U.S.C. §1701 et. seq., (d) the Bank Secrecy Act (31 U.S.C. Sections 5311 et seq.) as amended and (e) all other Requirements of Law relating to money laundering or terrorism, including without limitation, the USA Patriot Act and all regulations and executive orders promulgated with respect to money laundering or terrorism, including, without limitation, those promulgated by the Office of Foreign Assets Control of the United States Department of the Treasury.

 

Price Differential” shall mean, with respect to any Purchased Asset as of any date, the aggregate amount obtained by daily application of the applicable Pricing Rate for such Purchased Asset to the outstanding Purchase Price of such Purchased Asset on a 360-day-per-year basis for the actual number of days during each Pricing Rate Period commencing on (and including) the Purchase Date for such Purchased Asset and ending on (but excluding) the date of determination (reduced by any amount of such Price Differential previously paid by Seller to Administrative Agent, on behalf of Buyers, with respect to such Purchased Asset).

 

Pricing Rate” shall mean for any Pricing Rate Period and any Transaction:

 

(a)
during the Availability Period, an annual rate equal to the sum of (i) the Benchmark, plus

(ii) the relevant Applicable Spread, in each case, for the applicable Pricing Rate Period for the related Purchased Asset; and

 

(b)
during the Amortization Period, an annual rate equal to the sum of (i) the Benchmark, plus (ii) the Amortization Period Additional Percentage, plus (iii) the relevant Applicable Spread, in each case, for the applicable Pricing Rate Period for the related Purchased Asset.

 

The Pricing Rate, in any such case, shall be subject to adjustment and/or conversion as provided in the Transaction Documents (including, without limitation as provided in Article 14) or the related Confirmation.

 

Pricing Rate Determination Date” shall mean with respect to any Transaction, (i) with respect to the first Pricing Rate Period, the related Purchase Date for such Purchased Asset and (ii) with respect to any subsequent Pricing Rate Period, (a) if the Benchmark is LIBOR, the second (2nd) Business Day preceding the first day of such Pricing Rate Period and (b) if the Benchmark is not LIBOR, the day that is two (2) U.S. Government Securities Business Days prior to the first day of such Pricing Rate Period.

 

Pricing Rate Period” shall mean, with respect to any Transaction and any Remittance Date (a) in the case of the first Pricing Rate Period, the period commencing on and including the Purchase Date for such Transaction and ending on and excluding the following Remittance Date, and (b) in the case of any subsequent Pricing Rate Period, the period commencing on and including the immediately preceding Remittance Date and ending on and excluding such Remittance Date; provided, however, that in no event

 

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shall any Pricing Rate Period for a Purchased Asset end subsequent to the Repurchase Date for such Purchased Asset.

 

Primary Servicer” shall mean Wells Fargo Bank, N.A., or any other primary servicer approved by, or in the case of a termination of Primary Servicer pursuant to Article 29(c), appointed by Administrative Agent, on behalf of Buyers, in each case in Administrative Agent’s sole discretion.

 

Primary Servicing Agreement” shall mean the Servicing Agreement by and between Seller and Primary Servicer dated as of May 31, 2017 and, if any other Primary Servicer is approved by Administrative Agent in its sole discretion, any servicing agreement with such other Primary Servicer in respect of the Purchased Assets, which agreement is approved by Administrative Agent in its sole discretion.

 

Prime Rate” shall mean the “prime rate” published in the “Money Rates” section of The Wall Street Journal. If The Wall Street Journal ceases to publish the “prime rate,” then Administrative Agent shall select an equivalent publication that publishes such “prime rate,” and if such “prime rate” is no longer generally published or is limited, regulated or administered by a governmental or quasi- governmental body, then Administrative Agent shall reasonably select a comparable interest rate index. Notwithstanding the foregoing, in no event shall the Prime Rate be deemed to be less than the Benchmark Floor.

 

Prime Rate Applicable Spread” shall mean, if the Pricing Rate has converted to the Prime Rate pursuant to Article 14(a) of this Agreement, an amount equal to the difference (expressed as a number of basis points) between (a) Term SOFR (or the then-applicable Benchmark) plus the Applicable Spread on the date Term SOFR (or the then-applicable Benchmark) was last applicable to the outstanding Transactions prior to such conversion and (b) the Prime Rate on the date that Term SOFR (or the then- applicable Benchmark) was last applicable to the outstanding Transactions prior to such conversion.

 

Principal Payment” shall mean, with respect to any Purchased Asset, any scheduled or unscheduled payment or prepayment of principal received in respect thereof (including net sale proceeds or casualty or condemnation proceeds to the extent that such proceeds are not required under the related Purchased Asset Documents to be reserved, escrowed, readvanced or applied for the benefit of the Mortgagor or the related Underlying Mortgaged Property).

 

Prohibited Investor” shall mean (1) a Person whose name appears on the list of Specially Designated Nationals and Blocked Persons by the Office of Foreign Asset Control (“OFAC”), (2) any Person whose name appears on any list of terrorists, terrorist organizations or narcotics traffickers maintained pursuant to and of the Rules and Regulations of OFAC that Administrative Agent has notified Seller in writing is now included in such list, (3) any Person whose name appears on any list similar to those described in clauses (1) and (2) of this definition maintained by the United States Department of State, the United States Department of Commerce or any other government authority or pursuant to any Executive Order of the President of the United States that Administrative Agent has notified Seller in writing is now included on such list, (4) any foreign shell bank, and (5) any person or entity resident in or whose subscription funds are transferred from or through an account in a jurisdiction that has been designated as a non-cooperative with international anti-money laundering principles or procedures by an intergovernmental group or organization, such as the Financial Action Task Force on Money Laundering (“FATF”), of which the U.S. is a member and with which designation the U.S. representative to the group or organization continues to concur. See http://www.fatf-gati.org for FATF’s list of Non-Cooperative Countries and Territories.

 

 

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Prohibited Transferee” shall mean any of the Persons listed on Schedule I attached to this Agreement.

 

Properties” shall have the meaning set forth in Article 9(xxv) of this Agreement.

 

Public Listing” shall mean the listing of the direct or indirect legal or beneficial interests of Guarantor on a nationally or internationally recognized securities exchange or quoted on a nationally or internationally recognized automated quotation system.

 

Public Sale” shall mean the transfer (but not a pledge), in one or a series of transactions, including by way of merger, through which any direct or indirect owner of a legal or beneficial interest in Guarantor (including a transferee of such interests) becomes, or is merged with or into, a Public Vehicle.

 

Public Vehicle” shall mean a Person whose securities are listed and traded (or to be listed contemporaneously with a Public Listing) on a nationally or internationally recognized securities exchange or quoted on a nationally or internationally recognized automated quotation system.

 

Purchase Agreement” shall mean any purchase agreement between Seller and any Transferor pursuant to which Seller purchased or acquired an Asset that is subsequently sold to Administrative Agent, on behalf of Buyers, hereunder.

 

Purchase Date” shall mean, with respect to any Purchased Asset, the date on which Administrative Agent, on behalf of Buyers, purchases such Purchased Asset from Seller hereunder.

 

Purchase Date Purchase Price Debt Yield” shall mean as of any date of determination, with respect to any Purchased Asset the Purchase Price Debt Yield of each Purchased Asset as of the Purchase Date of each such Purchased Asset and each anniversary of the Purchase Date, as set forth in each related Confirmation.

 

Purchase Price” shall mean, with respect to any Purchased Asset, the price at which such Purchased Asset is transferred by Seller to Administrative Agent, on behalf of Buyers, on the applicable Purchase Date, adjusted after the Purchase Date as set forth below. The Purchase Price as of the Purchase Date for any Purchased Asset shall be an amount (expressed in dollars) equal to the product obtained by multiplying (i) the lesser of (A) Market Value of such Purchased Asset or (B) the par amount of such Purchased Asset by (ii) the Advance Rate for such Purchased Asset, as set forth on the related Confirmation. The Purchase Price of any Purchased Asset shall be (a) decreased by (x) any amount of Margin Deficit transferred by Seller to Administrative Agent, on behalf of Buyers, pursuant to Article 4(a) and applied to the Purchase Price of such Purchased Asset, (y) the portion of any Principal Payments on such Purchased Asset that are applied pursuant to Article 5 hereof to reduce such Purchase Price and

(z) any other amounts paid to Administrative Agent, on behalf of Buyers, by Seller to reduce such Purchase Price and (b) increased by any Future Funding Advance or by any other amounts disbursed by Administrative Agent, on behalf of Buyers, to Seller or to the related borrower on behalf of Seller with respect to such Purchased Asset to the related borrower on behalf of Seller with respect to such Purchased Asset.

 

Purchase Price Debt Yield” shall mean, on any date with respect to any Purchased Asset, a fraction (expressed as a percentage) (A) the numerator of which is the Underwritten Net Operating Income of the Underlying Mortgaged Property related to such Purchased Asset, as determined by Administrative Agent, on behalf of Buyers, in its sole discretion, and (B) the denominator of which is the Purchase Price of such Purchased Asset on such date.

 

 

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Purchased Asset” shall mean (i) with respect to any Transaction, the Eligible Asset sold by Seller to Administrative Agent, on behalf of Buyers, in such Transaction and (ii) with respect to the Transactions in general, all Eligible Assets sold by Seller to Administrative Agent, on behalf of Buyers (other than Purchased Assets that have been repurchased by Seller).

 

Purchased Asset Documents” shall mean, with respect to a Purchased Asset, the documents specified in Schedule II.

 

Purchased Asset File” shall mean, with respect to a Purchased Asset, the Purchased Asset Documents, together with any additional documents and information required to be delivered to Administrative Agent, on behalf of Buyers, or its designee (including the Custodian) pursuant to this Agreement.

 

Purchased Asset Schedule” shall mean a schedule of Purchased Assets attached to each Trust Receipt and Custodial Delivery Certificate delivered in accordance with the Custodial Agreement.

 

Purchased Items” shall have the meaning set forth in Article 6(a) of this Agreement.

 

Quarterly Reporting Package” shall mean the reporting package described on Exhibit III-B.

 

Recipient” means (a) Administrative Agent or (b) any Buyer, as applicable.

 

Reference Banks” shall mean any money center banks selected by Administrative Agent, on behalf of Buyers, which are engaged in transactions in Eurodollar deposits in the international Eurocurrency market with an established place of business in London.

 

Reference Time” shall mean, with respect to any Pricing Rate Period, if the Benchmark is LIBOR, 11:00 a.m. (London time) on the second Business Day preceding the first day of such Pricing Rate Period.

 

Register” shall have the meaning set forth in Article 19(b) of this Agreement.

 

Release Letter” shall mean a letter substantially in the form of Exhibit XII hereto (or such other form as may be acceptable to Administrative Agent).

 

Relevant Governmental Body” shall mean the Federal Reserve Board and/or the Federal Reserve Bank of New York, or a committee officially endorsed or convened by the Federal Reserve Board and/or the Federal Reserve Bank of New York or any successor thereto.

 

Remittance Date” shall mean the fifteenth (15th) calendar day of each calendar month, or the immediately succeeding Business Day, if such calendar day shall not be a Business Day, or such other day as is mutually agreed to by Seller and Administrative Agent, on behalf of Buyers.

 

Renewal Option” shall have the meaning set forth in Article 3(i)(ii) of this Agreement.

 

Renewal Period” shall have the meaning set forth in Article 3(i)(i) of this Agreement.

 

Renewal Period Fee” shall have the meaning set forth in the Fee Letter, which definition is incorporated herein by reference.

 

Repurchase Date” shall mean:

 

 

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(i)
with respect to a Purchased Asset that is not an Amortization Period Purchased Asset, the earliest to occur of (A) the Availability Period Expiration Date, (B) any Early Repurchase Date for such Transaction; (C) the Accelerated Repurchase Date, (D) any Mandatory Early Repurchase Date for such Transaction and (E) the maturity date (including any extension options under the related Purchased Asset Documents) of such Purchased Asset; and

 

(ii)
with respect to a Purchased Asset that is an Amortization Period Purchased Asset, the earliest to occur of (A) the Amortization Period Expiration Date; (B) any Early Repurchase Date for such Transaction; (C) the Accelerated Repurchase Date, (D) any Mandatory Early Repurchase Date for such Transaction and (E) the maturity date (including any extension options under the related Purchased Asset Documents) of such Purchased Asset.

 

Repurchase Obligations” shall have the meaning set forth thereto in Article 6(a).

 

Repurchase Price” shall mean, with respect to any Purchased Asset as of any Repurchase Date or any date on which the Repurchase Price is required to be determined hereunder, the price at which such Purchased Asset is to be transferred from Administrative Agent, on behalf of Buyers, to Seller; such price will be determined in each case as the sum of the (i) outstanding Purchase Price of such Purchased Asset;

(ii) the accreted and unpaid Price Differential with respect to such Purchased Asset as of the date of such determination; (iii) any other amounts due and owing by Seller to Buyers and their respective Affiliates pursuant to the terms of this Agreement with respect to such Purchased Asset as of such date; and (iv) if such Repurchase Date is not a Remittance Date, any Breakage Costs payable in connection with such repurchase other than with respect to the determination of a Margin Deficit.

 

Requested Exceptions Report” shall have the meaning set forth thereto in Article 3(c)(vii).

 

Requirement of Law” shall mean any law, treaty, rule, regulation, code, directive, policy, order or requirement or determination of an arbitrator or a court or other Governmental Authority whether now or hereafter enacted or in effect.

 

Reserve Requirement” shall mean, with respect to any Pricing Rate Period, the aggregate (without duplication) of the rates (expressed as a decimal fraction) of reserve requirements in effect during such Pricing Rate Period (including, without limitation, basic, supplemental, marginal and emergency reserves under any regulations of the Board of Governors of the Federal Reserve System or other Governmental Authority having jurisdiction with respect thereto) dealing with reserve requirements prescribed for Eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in Regulation D of such Board of Governors) maintained by Buyers.

 

Responsible Officer” shall mean any executive officer of Seller or Guarantor, as the context may require.

 

Revocable Option” shall have the meaning set forth in Article 7(d).

 

Sanctions” shall have the meaning set forth in Article 9(b)(xxvii).

 

SEC” shall have the meaning set forth in Article 24(a) of this Agreement.

 

Seller” shall mean the entity identified as “Seller” in the Recitals hereto and such other sellers as may be approved by Administrative Agent, on behalf of Buyers, in its sole discretion from time to time.

 

 

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Senior Mortgage Loans” shall mean whole, performing senior floating rate mortgage loans secured by first liens on commercial or multi-family properties.

 

Servicing Agreement” shall have the meaning set forth in Article 29(b).

 

Servicing Records” shall have the meaning set forth in Article 29(b).

 

Servicing Rights” shall mean contractual, possessory or other rights of any Person to administer, service or subservice any Purchased Assets (or to possess any Servicing Records relating thereto), including: (i) the rights to service the Purchased Assets; (ii) the right to receive compensation (whether direct or indirect) for such servicing, including the right to receive and retain the related servicing fee and all other fees with respect to such Purchased Assets; and (iii) all rights, powers and privileges incidental to the foregoing, together with all Servicing Records relating thereto.

 

Servicing Tape” shall have the meaning specified in Exhibit III-B hereto.

 

Significant Modification” shall mean (a) any extension, material amendment, waiver, termination, rescission, cancellation, release, subordination or other modification to the material terms of, or any collateral, guaranty or indemnity for, any Purchased Asset or Purchased Asset Document (including, without limitation, any provision related to the amount or timing of any scheduled payment of interest or principal, the validity, perfection or priority of any security interest, or the release of any collateral or obligor (except in accordance with the underlying Purchased Asset Documents)), (b) any sale, transfer, disposition or any similar action with respect to any collateral for any Purchased Asset (except to the extent required under the Purchased Asset Documents) or (c) the foreclosure or exercise of any material right or remedy by the holder of any Purchased Asset or Purchased Asset Document.

 

SIPA” shall have the meaning set forth in Article 24(a) of this Agreement.

 

Single Purpose Entity” shall mean any corporation, limited partnership or limited liability company that, since the date of its formation and at all times on and after the date hereof, has complied with and shall at all times comply with the provisions of Article 12 of this Agreement.

 

Subsidiary” shall mean, as to any Person, a corporation, partnership or other entity of which shares of stock or other ownership interests having ordinary voting power (other than stock or such other ownership interests having such power only by reason of the happening of a contingency) to elect a majority of the board of directors or other managers of such corporation, partnership or other entity are at the time owned, or the management of which is otherwise controlled, directly or indirectly through one or more intermediaries, or both, by such Person. Unless otherwise qualified, all references to a “Subsidiary” or to “Subsidiaries” in this Agreement shall refer to a Subsidiary or Subsidiaries of Seller and/or Guarantor.

 

Table Funded Purchased Asset” shall mean a Purchased Asset which is sold to Administrative Agent, on behalf of Buyers, simultaneously with the origination or acquisition thereof, which origination or acquisition is financed with the Purchase Price, pursuant to Seller’s request, paid directly to a Title Company or other settlement agent, in each case, approved by Administrative Agent, on behalf of Buyers, for disbursement in connection with such origination or acquisition. A Purchased Asset shall cease to be a Table Funded Purchased Asset after Custodian has delivered a Trust Receipt to Administrative Agent certifying its receipt of the Purchased Asset File therefor.

 

 

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Taxes” shall mean all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

 

Term SOFR” shall mean, for each Pricing Rate Period, the forward-looking term rate for a one- month period that is based on the secured overnight financing rate of the Federal Reserve Bank of New York (or its successor), as published by the Term SOFR Administrator on the applicable Pricing Rate Determination Date; provided, that if, as of 5:00 p.m. (New York City time) on any Pricing Rate Determination Date, such rate has not been published by the Term SOFR Administrator and a Benchmark Replacement Date with respect to Term SOFR has not occurred, then Term SOFR will be determined as of the first preceding U.S. Government Securities Business Day for which such rate was published by the Term SOFR Administrator, so long as such first preceding U.S. Government Securities Business Day is not more than three (3) U.S. Government Securities Business Days prior to such Pricing Rate Determination Date and if such Term SOFR for a one-month period was last published by the Term SOFR Administrator more than three (3) U.S. Government Securities Business Days prior to such Pricing Rate Determination Date then a Benchmark Interim Unavailability Period with respect to Term SOFR will be deemed to have occurred. Notwithstanding the foregoing, in no event will Term SOFR be deemed to be less than the Benchmark Floor.

 

Term SOFR Administrator” shall mean CME Group Benchmark Administration Limited (CBA) (or a successor administrator of Term SOFR as determined by Administrative Agent, on behalf of Buyers, in its reasonable discretion).

 

Title Company” shall mean a nationally-recognized title insurance company acceptable to Administrative Agent, on behalf of Buyers.

 

Title Policy” shall mean an American Land Title Association (ALTA) lender’s title insurance policy or a comparable form of lender’s title insurance policy (or escrow instructions binding on the Title Company and irrevocably obligating the Title Company to issue such title insurance policy, a title policy commitment or pro-forma “marked up” at the closing of the related Purchased Asset and countersigned by the Title Company or its authorized agent) as adopted in the applicable jurisdiction.

 

Transaction” shall mean a Transaction, as specified in Article 1 of this Agreement.

 

Transaction Documents” shall mean, collectively, this Agreement, any applicable Schedules, Exhibits and Annexes to this Agreement, the Guarantee Agreement, the Custodial Agreement, the Servicing Agreement, the Depository Agreement, the Pledge and Security Agreement, the Fee Letter, all Confirmations and assignment documentation executed pursuant to this Agreement in connection with specific Transactions, each of the foregoing as may be amended, restated, supplemented or modified from time-to-time.

 

Transfer” shall mean, with respect to any Person, any sale or other whole or partial conveyance of all or any portion of such Person’s assets, or any direct or indirect interest therein to a third party (other than in connection with the transfer of a Purchased Asset to Administrative Agent, on behalf of Buyers, in accordance herewith), including the granting of any purchase options, rights of first refusal, rights of first offer or similar rights in respect of any portion of such assets or the subjecting of any portion of such assets to restrictions on transfer.

 

Transferee” shall have the meaning set forth in Article 19(a) hereof.

 

 

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Transferor” shall mean the seller of an Asset under a Purchase Agreement that is not an Affiliate of Seller.

 

Trust Receipt” shall mean a trust receipt issued by Custodian, or, in the case of a Table Funded Purchased Asset, Bailee, to Administrative Agent, on behalf of Buyers, substantially in the form required under the Custodial Agreement or the Bailee Agreement.

 

UCC” shall have the meaning specified in Article 6(c) of this Agreement.

 

Unadjusted Benchmark Replacement” shall have the meaning set forth in the definition of “Benchmark Replacement”.

 

Underlying Mortgaged Property” shall mean the real property securing the related Purchased

Asset.

 

Underwriting Issues” shall mean, with respect to any Purchased Asset as to which Seller intends to request a Transaction, all information known by Seller that, based on the making of reasonable inquiries and the exercise of reasonable care and diligence under the circumstances, would be considered a materially “negative” factor (either separately or in the aggregate with other information), or a defect in loan documentation or closing deliveries (such as any absence of any Purchased Asset Document(s)), to a reasonable institutional mortgage buyer in determining whether to originate or acquire the Purchased Asset in question.

 

Underwritten Net Operating Income” shall mean, on any date with respect to any one or more Purchased Assets, the actual net operating income from the Underlying Mortgaged Property or Underlying Mortgaged Properties securing such Purchased Asset or Purchased Assets with respect to the prior twelve (12) months, as determined in accordance with the Purchased Asset Documents, certified by the underlying obligor and approved by Administrative Agent, on behalf of Buyers, in its good faith discretion.

 

Unintended Recipient” shall have the meaning set forth in Article 30(d)(i) of this Agreement.

 

USA Patriot Act” shall have the meaning ascribed to such term in the definition of “Prescribed

Laws”.

 

U.S. Government Securities Business Day” shall mean any day except for (i) a Saturday, (ii) a Sunday or (iii) a day on which the Securities Industry and Financial Markets Association, or any successor thereto, recommends that the fixed income departments of its members be closed for the entire day for purposes of trading in United States government securities.

 

U.S. Person” means any Person that is a “United States person” as defined in Section 7701(a)(30) of the Code.

 

U.S. Tax Compliance Certificate” shall have the meaning set forth in Article 14(k)(B)(3) of this Agreement.

 

VCOC” shall mean a “venture capital operating company” within the meaning of Section 2510.3-101(d) of the Plan Asset Regulations.

 

 

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Voting Stock” shall mean, with respect to any specified “person” (as that term is used in Section 13(d)(3) of the 1934 Act) as of any date, the Capital Stock of that person that is at the time entitled to vote generally in the election of the board of directors of that person.

 

All references to articles, schedules and exhibits are to articles, schedules and exhibits in or to this Agreement unless otherwise specified. The words “hereof,” “herein” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement. All accounting terms not specifically defined herein shall be construed in accordance with generally accepted accounting principles. References to “good faith” in this Agreement shall mean “honesty in fact in the conduct or transaction concerned”.

 

ARTICLE 3.

INITIATION; CONFIRMATION; TERMINATION; FEES

 

(a)
Conditions Precedent to Initial Transaction. Administrative Agent’s and Buyers’ agreement to enter into the initial Transaction hereunder is subject to the satisfaction, immediately prior to or concurrently with the making of such Transaction (unless otherwise stated below), of the condition precedent that Administrative Agent, on behalf of Buyers, has received from Seller all of the following documents, each of which shall be satisfactory in form and substance to Administrative Agent and its counsel:

 

(i)
Transaction Documents. The Transaction Documents duly executed by the parties thereto (including all exhibits thereto).

 

(ii)
Power of Attorney. The power of attorney, duly executed by Seller, substantially in the form set forth on Exhibit IV hereto.

 

(iii)
Consents. Any and all consents and waivers of Seller applicable to Seller or to the Purchased Assets;

 

(iv)
Security Interest. UCC financing statements for filing in each of the UCC filing jurisdictions described on Exhibit X hereto, each naming Seller or Pledgor as applicable as “Debtor” and Administrative Agent, on behalf of Buyers, as “Secured Party” and adequately describing as “Collateral”, with respect to Seller, as “all assets of Seller, whether now owned or existing or hereafter acquired or arising” and, with respect to Pledgor, all of the items set forth in the definition of Collateral in the Pledge and Security Agreement, together with any other documents necessary or requested by Administrative Agent to perfect the security interests granted by Seller in favor of Administrative Agent, on behalf of Buyers, under this Agreement or any other Transaction Document.

 

(v)
Intentionally Omitted.

 

(vi)
Intentionally Omitted.

 

(vii)
Opinions of Counsel. Opinions of outside counsel to Seller reasonably acceptable to Administrative Agent and Buyers (including, but not limited to, those relating to enforceability, bankruptcy safe harbor, corporate matters, applicability of the Investment Company Act of 1940 to Seller, and security interests) delivered no later than ten (10) Business Days after the Closing Date.

 

 

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(viii)
Organizational Documents. Good standing certificates and certified copies of the certificate of incorporation, memorandum and articles of association, charters and by-laws (or equivalent documents) of Seller, Pledgor and Guarantor and of all corporate or other authority for Seller and Guarantor with respect to the execution, delivery and performance of the Transaction Documents and each other document to be delivered by Seller and Guarantor from time to time in connection herewith (and Administrative Agent and Buyers may conclusively rely on such certificate until it receives notice in writing from Seller to the contrary).

 

(ix)
Fees and Expenses. Administrative Agent, on behalf of Buyers, shall have received payment from Seller of an amount equal to the amount of actual costs and expenses, including, without limitation, the reasonable fees and expenses of counsel to Administrative Agent and/or Buyers, incurred by Administrative Agent and/or Buyers in connection with the development, preparation and execution of this Agreement, the other Transaction Documents and any other documents prepared in connection herewith or therewith.

 

(x)
Other Documents. Such other documents, documentation and legal opinions (delivered in accordance with clause (vii) above) as Administrative Agent or Buyers may reasonably require.

 

(b)
Due Diligence Review. Administrative Agent, on behalf of Buyers, shall have the right to review, as described in Exhibit VI hereto, the Eligible Assets Seller proposes to sell to Administrative Agent, on behalf of Buyers, in any Transaction and to conduct its own due diligence investigation of such Eligible Assets as Administrative Agent determines (“Pre-Purchase Due Diligence”). Administrative Agent, on behalf of Buyers, shall be entitled to make a determination, in the exercise of its sole discretion, that, in the case of a Transaction, it shall or shall not purchase any or all of the assets proposed to be sold to Administrative Agent, on behalf of Buyers, by Seller. Administrative Agent shall inform Seller of its approval of the deliverables required in accordance with Exhibit VI attached hereto. Not less than ten

(10) Business Days prior to the requested Purchase Date for the Transaction, Administrative Agent, on behalf of Buyers, shall approve an Eligible Asset in accordance with Exhibit VI hereto, which approval shall be revocable in Administrative Agent’s sole discretion prior to Administrative Agent’s execution and delivery of the Confirmation on the Purchase Date. On the Purchase Date for the Transaction, which shall occur upon Administrative Agent’s and Seller’s execution of a Confirmation with respect to an Eligible Asset, the Eligible Assets shall be transferred to Administrative Agent, on behalf of Buyers, against the transfer of the Purchase Price to an account of Seller. Upon the approval by Administrative Agent, on behalf of Buyers, of a particular proposed Transaction, Administrative Agent shall deliver to Seller a signed copy of the related Confirmation described in clause (v) below, on or before the scheduled Purchase Date of the underlying proposed Transaction, which shall serve as evidence that all conditions relating to the Proposed Transactions (as set forth in Article 3(a) or 3(c) or Exhibit VI, or elsewhere, as applicable) have been satisfied or waived by Administrative Agent, on behalf of Buyers.

 

(c)
Conditions Precedent to all Transactions. Administrative Agent’s, on behalf of Buyers, agreement to enter into each Transaction (including the initial Transaction) shall be determined in Administrative Agent’s sole discretion and is otherwise subject to the satisfaction of the following further conditions precedent, both immediately prior to entering into such Transaction and also after giving effect to the consummation thereof and the intended use of the proceeds of the sale:

 

(i)
Seller shall give Administrative Agent no less than two (2) Business Days’ prior written notice of each Transaction (including the initial Transaction), which notice shall describe the terms of the Transaction and the Purchased Assets;

 

 

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(ii)
The sum of (A) the unpaid Purchase Price for all prior outstanding Transactions and (B) the requested Purchase Price for the pending Transaction, in each case, shall not exceed the Maximum Facility Amount;

 

(iii)
No Market Disruption Event or Force Majeure Event has occurred and is continuing, no Margin Deficit that has resulted in a Margin Deficit Notice, Potential Event of Default or Event of Default shall exist under this Agreement or any other Transaction Document;

 

(iv)
No Material Adverse Effect shall exist;

 

(v)
Seller shall have executed a Confirmation for such proposed Transaction;

 

(vi)
Administrative Agent, on behalf of Buyers, shall have (i) determined, in its sole discretion, that the Asset proposed to be sold to Administrative Agent, on behalf of Buyers, by Seller in such Transaction is an Eligible Asset, (ii) satisfactorily completed its “Know Your Customer” and OFAC diligence (as to the related Mortgagor, guarantor and all other related parties, as determined by Administrative Agent), (iii) determined conformity to the terms of the Transaction Documents and Administrative Agent’s or any Buyers’ internal credit and underwriting criteria, and (iv) obtained internal credit approval, to be granted or denied in Administrative Agent’s sole discretion, for the inclusion of such Eligible Asset as a Purchased Asset in a Transaction, without regard for any prior credit decisions by Administrative Agent or any Buyer or any respective Affiliate of Administrative Agent or any Buyer, and with the understanding that Administrative Agent or any Buyer shall have the absolute right to change any or all of its internal underwriting criteria at any time, without notice of any kind to Seller;

 

(vii)
Seller shall have delivered to Administrative Agent, on behalf of Buyers, a list of all exceptions to the representations and warranties relating to the Eligible Asset and any other eligibility criteria for such Eligible Asset (the “Requested Exceptions Report”);

 

(viii)
Guarantor shall have delivered to Administrative Agent a true and accurate Covenant Compliance Certificate with respect to Guarantor’s most recently ended fiscal quarter for which a Covenant Compliance Certificate is required to be delivered hereunder, provided that to the extent Guarantor has previously delivered to Administrative Agent a Covenant Compliance Certificate for the most recently ended fiscal quarter, Seller or Guarantor need not provide an additional Covenant Compliance Certificate for such fiscal quarter in connection with the proposed Transaction;

 

(ix)
both immediately prior to the requested Transaction and also after giving effect thereto and to the intended use thereof, the representations and warranties made by Seller in each of Exhibit V and Article 9 shall be true, correct and complete on and as of such Purchase Date in all respects with the same force and effect as if made on and as of such date (or, if any such representation or warranty is expressly stated to have been made as of a specific date, as of such specific date), subject to such exceptions specified in any Requested Exceptions Report that has been approved by Administrative Agent, on behalf of Buyers;

 

(x)
subject to Administrative Agent’s and Buyers’ rights to perform one or more due diligence reviews pursuant to Article 28, Administrative Agent shall have completed its due diligence review of the Purchased Asset File, and such other documents, records, agreements, instruments, mortgaged properties or information relating to such Purchased Asset as Administrative Agent, on behalf of Buyers, in its sole discretion deems appropriate to review, including, without limitation, all external legal due diligence any due diligence relating to lending

 

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licensing requirements which may impact Buyers, and such review shall be satisfactory to Administrative Agent in its sole discretion and Administrative Agent, on behalf of Buyers, has consented in writing to the Eligible Asset becoming a Purchased Asset;

 

(xi)
with respect to any Eligible Asset to be purchased hereunder on the related Purchase Date that is not primarily serviced by the Primary Servicer, Seller shall have provided to Administrative Agent a copy of the related Servicing Agreement, certified as a true, correct and complete copy of the original, fully executed by Seller and the servicer named in the related Servicing Agreement;

 

(xii)
Seller shall have directed Servicer to remit all such payments into the Depository Account and to service such payments in accordance with the provisions of this Agreement;

 

(xiii)
Seller shall have paid to Administrative Agent, on behalf of Buyers, all amounts that are due and payable under this Agreement at the time of such Transaction, including, without limitation, all legal fees and expenses of outside counsel and the reasonable out-of-pocket costs and expenses actually incurred by Administrative Agent, on behalf of Buyers, in connection with the entering into of any Transaction hereunder, including, without limitation, costs associated with due diligence, recording or other administrative expenses necessary or incidental to the execution of any Transaction hereunder, which amounts, at Administrative Agent’s, on behalf of Buyers, option, may be withheld from the sale proceeds of any Transaction hereunder;

 

(xiv)
Administrative Agent, on behalf of Buyers, shall have reasonably determined that the introduction of, or a change in, any Requirement of Law or in the interpretation or administration of any Requirement of Law including without limitation changes in any Reserve Requirements and any other increase in cost to Administrative Agent or any Buyer, applicable to Administrative Agent or any Buyer has not made it unlawful or impracticable, and no Governmental Authority shall have asserted that it is unlawful, for Administrative Agent or any Buyer to enter into the Transaction;

 

(xv)
Seller shall have taken such other action as Administrative Agent, on behalf of Buyers, shall have reasonably requested in order to transfer the Purchased Assets pursuant to this Agreement and to perfect all security interests granted under this Agreement or any other Transaction Document in favor of Administrative Agent, on behalf of Buyers, with respect to the Purchased Assets;

 

(xvi)
If such Eligible Asset was acquired by Seller from a Person that is not an Affiliate of Seller, Seller shall have disclosed to Administrative Agent, on behalf of Buyers, the acquisition cost of such Eligible Asset (including therein reasonable supporting documentation required by Administrative Agent and/or any Buyer, if any);

 

(xvii)
Administrative Agent, on behalf of Buyers, shall have received all such other and further documents, documentation and legal opinions as Administrative Agent in its reasonable discretion shall reasonably require; provided, however, that in the case of the initial Transaction, such legal opinions shall be delivered no later than ten (10) Business Days after the Closing Date;

 

(xviii)
Administrative Agent, on behalf of Buyers, shall have received (i) other than with respect to a Table Funded Purchased Asset, from Custodian on each Purchase Date an Asset Schedule and Exception Report (as defined in the Custodial Agreement) with respect to each Purchased Asset, dated the Purchase Date, duly completed and with exceptions acceptable to Administrative Agent in its sole discretion in respect of Eligible Assets to be purchased hereunder

 

 

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on such Business Day; or (ii) a Bailee Letter from an Acceptable Attorney identifying the applicable Release Letter being held on behalf of Administrative Agent, on behalf of Buyers;

 

(xix)
as of the applicable Purchase Date for such Eligible Asset, each of the Concentration Limits is satisfied;

 

(xx)
Administrative Agent shall have received from Seller an original Release Letter covering such Eligible Asset to be sold to Administrative Agent, on behalf of Buyers;

 

(xxi)
The Advance Rate relating to such Eligible Asset shall not exceed the Maximum Advance Rate;

 

(xxii)
as of the Purchase Date, the related Eligible Asset shall have a Buyer’s LTV no greater than sixty percent (60%); and

 

(xxiii)
Administrative Agent, on behalf of Buyers, shall have received from Seller the Draw Fee related to such Eligible Asset in accordance with the terms and provisions of the Fee Letter.

 

(d)
Transfer of Purchased Assets; Servicing Rights. During the Availability Period, upon the satisfaction of all conditions set forth in Articles 3(a), 3(b) and 3(c), Seller shall sell, transfer, convey and assign to Administrative Agent, on behalf of Buyers, on a servicing released basis all of Seller’s right, title and interest in and to each Purchased Asset, together with all related Servicing Rights against the transfer of the Purchase Price to an account of Seller. With respect to any Transaction, the Pricing Rate shall be determined initially on the Pricing Rate Determination Date applicable to the first Pricing Rate Period for such Transaction and shall be reset on the Pricing Rate Determination Date for each of the next succeeding Pricing Rate Periods for such Transaction. Administrative Agent or its agent shall determine in accordance with the terms of this Agreement the Pricing Rate on each Pricing Rate Determination Date for the related Pricing Rate Period in Administrative Agent’s sole discretion, and notify Seller of such rate for such period each such Pricing Rate Determination Date.

 

(e)
Confirmation. Each Confirmation, together with this Agreement, shall be conclusive evidence of the terms of the Transaction covered thereby. In the event of any conflict between the terms of such Confirmation and the terms of this Agreement with respect to a particular Transaction, the Confirmation shall prevail.

 

(f)
Early Repurchase Date; Mandatory Repurchases.

 

(i)
Seller shall be entitled to terminate a Transaction on demand and repurchase the Purchased Asset subject to a Transaction on any Business Day prior to the Repurchase Date (an “Early Repurchase Date”) upon satisfaction of the following conditions:

 

(A)
No later than two (2) Business Days prior to the proposed Early Repurchase Date, Seller notifies Administrative Agent in writing of its intent to terminate such Transaction and repurchase such Purchased Asset, setting forth the proposed Early Repurchase Date and identifying with particularity the Purchased Asset to be repurchased on such Early Repurchase Date,

 

(B)
on such Early Repurchase Date, Seller pays to Administrative Agent, on behalf of Buyers, an amount equal to the sum of (x) the Repurchase Price for the applicable Purchased Asset, and (y) any other amounts due and payable under this

 

 

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Agreement (including, without limitation, Article 14(f) of this Agreement) with respect to such Purchased Asset against transfer to Seller or its agent of the Purchased Assets,

 

(C)
no Potential Event of Default, Event of Default or Margin Deficit shall be continuing or would occur or result from such early repurchase, and

 

(D)
on such Early Repurchase Date, Seller pays any Exit Fee which may be due and payable in connection with the repurchase of such Purchased Asset in accordance with the terms and conditions of the Fee Letter.

 

(ii)
In addition to any other rights and remedies of Administrative Agent and Buyers under any Transaction Document, upon the occurrence of a Mandatory Early Repurchase Event, Seller shall, in accordance with the procedures set forth in Article 3(f)(i)(B)-(D), and Article 3(h), repurchase any such Purchased Asset on the date (the “Mandatory Early Repurchase Date”) that is two (2) Business Days after the earlier of Seller’s receipt of notice from Administrative Agent or Seller’s Knowledge of the occurrence thereof.

 

(g)
Indemnification. Seller shall indemnify Administrative Agent and Buyers and hold Administrative Agent, and Buyers harmless from any actual out-of-pocket loss, cost or expense (including, without limitation, reasonable attorneys’ fees and disbursements of outside counsel) that Administrative Agent and/or Buyers may sustain or incur as a consequence of (i) default by Seller in repurchasing any Purchased Asset on the proposed Early Repurchase Date, after Seller has given written notice in accordance with Article 3(f), (ii) any payment of the Repurchase Price on any day other than a Remittance Date, including Breakage Costs, (iii) a default by Seller in selling Eligible Assets after Seller has notified Administrative Agent of a proposed Transaction and Administrative Agent, on behalf of Buyers, has agreed in writing to purchase such Eligible Assets in accordance with the provisions of this Agreement, (iv) Administrative Agent, on behalf of Buyers, enforcement of the terms of any of the Transaction Documents, (v) any actions taken to perfect or continue any Lien created under any Transaction Documents, and/or (vi) Administrative Agent and Buyers entering into any of the Transaction Documents or owning any Purchased Item. A certificate as to such costs, losses, damages and expenses, setting forth the calculations therefor shall be submitted promptly by Administrative Agent, on behalf of Buyers, to Seller in writing and shall be prima facie evidence of the information set forth therein, absent manifest error. This Article 3(g) shall not apply with respect to Taxes other than any Taxes that represent losses, claims, damages, etc. arising from any non-Tax claim.

 

(h)
Repurchase. On the Repurchase Date for any Transaction, termination of the Transaction will be effected by transfer to Seller or its agent of the related Purchased Assets being repurchased and any Income in respect thereof received by Administrative Agent, on behalf of Buyers (and not previously credited or transferred to, or applied to the obligations of, Seller pursuant to Article 5 of this Agreement), against the simultaneous transfer of the Repurchase Price to an account of Administrative Agent, on behalf of Buyers.

 

(i)
Availability Period; Renewals. (i) From and after the Availability Period Expiration Date, Seller shall have no ability to sell any new Eligible Assets to Administrative Agent, on behalf of Buyers. If Administrative Agent, on behalf of Buyers, and Seller have not entered into the Amortization Period in accordance with the terms and conditions of Article 3(m), then (A) on the Availability Period Expiration Date, Seller shall be obligated to repurchase all of the Purchased Assets and transfer payment of the Repurchase Price for each such Purchased Asset, together with the accrued and unpaid Price Differential and any other amounts due and payable to Administrative Agent, on behalf of Buyers, hereunder, against the transfer by Administrative Agent, on behalf of Buyers, to Seller of each such Purchased Asset, and (B) following the Availability Period Expiration Date, Administrative Agent, on

 

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behalf of Buyers, shall not be obligated to transfer any Purchased Assets to Seller until payment in full to Administrative Agent, on behalf of Buyers, of all amounts due hereunder.

 

(ii)
Seller shall have the option to extend the Availability Period Expiration Date for a period of one (1) year to May 31, 2023 (the “Renewal Option”), provided that Seller has satisfied all of the conditions listed in clause (iv) below (collectively, the “Availability Period Renewal Conditions”);
(iii)
Intentionally omitted.

 

(iv)
For purposes of this Article 3(i), the Availability Period Renewal Conditions shall have been satisfied if:

 

(A)
Seller shall have given Administrative Agent written notice of Seller’s extension of the Availability Period Expiration Date, (x) with respect to the initial request to extend the Availability Period Expiration Date, not less than thirty (30) calendar days prior, and no more than ninety (90) calendar days prior to the first (1st) anniversary of the Closing Date, and (y) with respect to any subsequent requests to extend the Availability Period Expiration Date, not less than thirty (30) calendar days prior, and no more than ninety (90) calendar days prior to the next succeeding anniversary of the Closing Date;

 

(B)
Seller shall have paid to Administrative Agent, on behalf of Buyers, the Renewal Period Fee in accordance with the terms and provisions of the Fee Letter;

 

(C)
no Margin Deficit that has resulted in a Margin Deficit Notice or Event of Default under this Agreement shall have occurred and be continuing as of the date of the then-current Availability Period Expiration Date; and

 

(D)
the representations and warranties made by Seller, Pledgor and Guarantor in any of the Transaction Documents shall be true, correct, complete and accurate in all respects as of the date Seller submitted its notice of extension of the Renewal Option and as of the then-current Availability Period Expiration Date (except such representations which by their terms speak as of a specified date and subject to any exceptions disclosed to Administrative Agent, on behalf of Buyers, in a Requested Exceptions Report prior to such date and approved by Administrative Agent).

 

(v)
Notwithstanding any of the foregoing to the contrary, if Seller elects to enter the Amortization Period in accordance with the terms and conditions of Article 3(m) prior to exercising the Renewal Option hereunder then Seller shall forfeit the Renewal Option and shall have no ability to request to renew this Agreement and the Transaction Documents pursuant to this Article 3(i).

 

(j)
Voluntary Reduction of Purchase Price. On any Business Day prior to the Repurchase Date, Seller shall have the right, from time to time, to transfer cash to Administrative Agent, on behalf of Buyers, for the purpose of reducing the outstanding Purchase Price of any Purchased Asset without terminating the Transaction and without release of any Purchased Items; provided, that (i) any such reduction in outstanding Purchase Price occurring on a date other than a Remittance Date shall be required to be accompanied by payment of all unpaid accrued Price Differential as of the applicable Business Day on the amount of such reduction and (ii) Seller provides Administrative Agent with three

(3) Business Days prior notice with respect to any reduction in outstanding Purchase Price occurring on any date that is not a Remittance Date. In connection with any such reduction of outstanding Purchase Price pursuant to this Article 3(j), Administrative Agent, on behalf of Buyers, and Seller shall modify the

 

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existing Confirmation for the Transaction to set forth the new Advance Rate and outstanding Purchase Price for such Purchased Asset. Any transfer of cash made pursuant to this Article 3(j) shall be in an amount equal to or greater than $1,000,000.

 

(k)
Additional Advances. (i) On any Business Day prior to the Repurchase Date, if at any time the effective Advance Rate based on the outstanding Purchase Price with respect to a Purchased Asset is less than the Advance Rate as set forth in the Confirmation for such Purchased Asset, Seller may submit to Administrative Agent a request that Buyers transfer cash to Seller so as to increase the outstanding Purchase Price for such Purchased Asset in the amount requested by Seller (an “Additional Advance”). Buyers’ agreement to make any Additional Advance shall be in the sole discretion of Administrative Agent, on behalf of Buyers, and in any case is subject to the satisfaction of the following conditions precedent, both immediately prior to making such Additional Advance and also after giving effect to the consummation thereof:

 

(A)
as of the funding of such Additional Advance, no Margin Deficit that is due and payable or Event of Default has occurred and is continuing or would result from the funding of such Additional Advance;

 

(B)
the funding of the Additional Advance would not cause the related Purchased Asset to exceed the applicable Maximum Advance Rate;

 

(C)
the funding of the Additional Advance would not cause the aggregate outstanding Purchase Price for all Purchased Assets to exceed the Maximum Facility Amount;

 

(D)
the amount of the Additional Advance is no less than $500,000; and

 

(E)
Administrative Agent, on behalf of Buyers, shall have satisfactorily completed all applicable credit approval requirements.

 

(ii) On the date of the Additional Advance, which shall occur following the final approval of the Additional Advance that all conditions set forth in this Article 3(k) have been satisfied, Buyers shall transfer cash to Seller as provided in this Article 3(k) (and in accordance with the wire instructions provided by Seller in such request). Upon approval by Administrative Agent, on behalf of Buyers, of a particular Additional Advance pursuant to this Article 3(k), Administrative Agent, on behalf of Buyers, and Seller shall modify the existing Confirmation for the applicable Transaction to set forth the new Advance Rate, outstanding Purchase Price and Buyer’s LTV for such Purchased Asset and any other modifications to the terms set forth on the existing Confirmation.

 

(l)
Future Funding Advance. (i) Subject to Article 4, at any time prior to the Repurchase Date, in the event a future funding is made or is to be made by Seller pursuant to the Purchased Asset Documents for a Purchased Asset, Seller may submit to Administrative Agent, on behalf of Buyers, a request that Buyers transfer cash to Seller in an amount not to exceed the Maximum Advance Rate multiplied by the amount of such future funding (a “Future Funding Advance”), which Future Funding Advance shall increase the outstanding Purchase Price for such Purchased Asset. Buyers’ agreement to make any Future Funding Advance shall be in the sole discretion of Administrative Agent, on behalf of Buyers, and in any case is subject to the satisfaction of the following conditions precedent, both immediately prior to making such Future Funding Advance and also after giving effect to the consummation thereof:

 

 

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(A)
as of the funding of such Future Funding Advance, no Margin Deficit, Potential Event of Default or Event of Default has occurred and is continuing or would result from the funding of such Future Funding Advance;

 

(B)
the funding of the Future Funding Advance would not cause the aggregate outstanding Purchase Price for all Purchased Assets to exceed the Maximum Facility Amount;

 

(C)
the Future Funding Advance would not cause the Purchase Price of the applicable Purchased Asset or the aggregate Purchase Price of all applicable Purchased Assets, in either such case, to exceed the Concentration Limits;

 

(D)
the amount of the Future Funding Advance is no less than $1,000,000;

 

(E)
Seller shall have demonstrated to Administrative Agent’s, on behalf of Buyers, satisfaction that all conditions to the future funding under the Purchased Asset Documents have been satisfied; and

 

(F)
Administrative Agent, on behalf of Buyers, shall have satisfactorily completed all applicable credit approval requirements and any additional due diligence investigation of the related Purchased Asset, as described in Exhibit XVI, and as determined by Buyers in their sole discretion (the “Future Funding Due Diligence”).

 

(ii)
On the date of the Future Funding Advance, which shall occur following the final approval of the Future Funding Advance that all conditions set forth in this Article 3(l) have been satisfied. Buyers shall transfer cash to Seller as provided in this Article 3(l) (and in accordance with the wire instructions provided by Seller in such request). Upon approval by Administrative Agent, on behalf of Buyers, of a particular Future Funding Advance pursuant to this Article 3(l), Administrative Agent, on behalf of Buyers, and Seller shall modify the existing Confirmation for the applicable Transaction to set forth the new Advance Rate, outstanding Purchase Price and Buyer’s LTV for such Purchased Asset and any other modifications to the terms set forth on the existing Confirmation.

 

(iii)
Notwithstanding anything to the contrary herein, Buyers shall not be obligated to make any Future Funding Advance unless Seller has previously or simultaneously with Buyers’ funding of a Future Funding Advance funded or caused to be funded to the related Mortgagor (or to an escrow agent or as otherwise directed by the related Mortgagor) in respect of such Purchased Asset.

 

(m)
Amortization Period.

 

(i)
Provided all of the Amortization Period Conditions are satisfied, Seller shall have the option to extend the Repurchase Date for all outstanding Transactions as of the Availability Period Expiration Date for a period equal to the lesser of (x) the date that all Repurchase Obligations have been paid in full and no Purchased Assets remain subject to Transactions and

(y) two (2) years (such period, the “Amortization Period”) from the date of the Availability Period Expiration Date (such date, the “Amortization Period Expiration Date”). For purposes of this Article 3(m)(i), the “Amortization Period Conditions” shall be deemed to have been satisfied if:

 

 

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(A)
Seller shall have given Administrative Agent written notice, not less than sixty (60) days and no more than one hundred twenty (120) days, prior to then-current Availability Period Expiration Date, of Seller’s desire to enter the Amortization Period;

 

(B)
no Margin Deficit that has resulted in a Margin Deficit Notice, or Event of Default under this Agreement shall have occurred and be continuing as of the Availability Period Expiration Date;

 

(C)
the representations and warranties made by Seller, Pledgor and Guarantor in any of the Transaction Documents shall be true and correct in all respects as of the then-current Availability Period Expiration Date, except to the extent that such representations and warranties (a) are made as of a particular date, (b) are no longer true as a result of a change in fact with respect to a Purchased Asset that was consented to in writing by Administrative Agent, on behalf of Buyers, hereunder or (c) are disclosed in a Requested Exceptions Report;

 

(D)
Administrative Agent, on behalf of Buyers, and Seller shall have executed amended Confirmations for the Amortization Period Assets; and

 

(E)
Seller shall have paid to Administrative Agent, on behalf of Buyers, the Amortization Period Fee then due and payable to Buyers.

 

(ii)
During the Amortization Period, Seller shall pay Administrative Agent, on behalf of Buyers, the Amortization Period Fee in accordance with the terms and conditions of the Fee Letter.

 

(iii)
During the Amortization Period, Administrative Agent, on behalf of Buyers, shall not purchase any new Eligible Assets. If Administrative Agent, on behalf of Buyers, and Seller have entered into the Amortization Period in accordance with the terms and conditions of this Article 3(m), then (A) on the Amortization Period Expiration Date, Seller shall be obligated to repurchase all of the Purchased Assets subject to Transactions and transfer payment of the Repurchase Price for each such Purchased Asset, together with the accrued and unpaid Price Differential and any other amounts due and payable to Buyers hereunder, against the transfer by Administrative Agent, on behalf of Buyers, to Seller of each such Purchased Asset, and (B) following the Amortization Period Expiration Date, Administrative Agent, on behalf of Buyers, shall not be obligated to transfer any Purchased Assets to Seller until payment in full to Buyers of all amounts due hereunder.

 

ARTICLE 4.

MARGIN MAINTENANCE

 

(a)
Administrative Agent, on behalf of Buyers, may, at its option in its sole discretion, determine if a Margin Deficit Event has occurred, at any time and from time to time. If a Margin Deficit Event then exists that results in a Margin Deficit that equals or exceeds $500,000, then Administrative Agent, on behalf of Buyers, may by notice to Seller in the form of Exhibit VII (a “Margin Deficit Notice”) require Seller to make a cash payment in reduction of the outstanding Purchase Price for such Purchased Asset, such that, after giving effect to such payment, no Margin Deficit shall exist with respect to the related Purchased Asset. Seller shall perform the obligations under this Article 4(a) by the close of the second (2nd) Business Day following receipt of the Margin Deficit Notice.

 

 

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(b)
The failure of Administrative Agent, on behalf of Buyers, or Buyers, on any one or more occasions, to exercise its rights hereunder, shall not change or alter the terms and conditions to which this Agreement is subject or limit the rights of Administrative Agent, on behalf of Buyers, or Buyers, to do so at a later date. Seller and Administrative Agent, on behalf of Buyers, each agree that a failure or delay by Administrative Agent, on behalf of Buyers, to exercise its rights hereunder shall not limit or waive Administrative Agent or Buyers’ rights under this Agreement or otherwise existing by law or in any way create additional rights for Seller.

 

ARTICLE 5.

INCOME PAYMENTS AND PRINCIPAL PAYMENTS

 

(a)
The Depository Account shall be established at the Depository and shall be subject to the Depository Agreement which shall be executed and delivered concurrently with the execution and delivery of this Agreement. Pursuant to the Depository Agreement, Administrative Agent, on behalf of Buyers, shall have sole dominion and control over the Depository Account. The Depository Account shall, at all times, be subject to the Depository Agreement. Seller shall cause all Income in respect of the Purchased Assets, as well as any interest received from the reinvestment of such Income, to be deposited into the Depository Account. In furtherance of the foregoing, Seller shall cause Primary Servicer to remit to the Depository Account all Income received in respect of the Purchased Assets within two (2) Business Days of receipt. All Income in respect of the Purchased Assets shall be deposited directly into, or, if applicable, remitted directly from the applicable underlying collection account to, the Depository Account.

 

(b)
So long as no Event of Default shall have occurred and be continuing, all Income (other than Principal Payments) on deposit in the Depository Account in respect of the Purchased Assets during each Collection Period shall be applied on the related Remittance Date as follows:

 

(i)
first, (a) to the Custodian for the payment of the fees payable to Custodian pursuant to the Custodial Agreement, then (b) to the Depository pursuant to the Depository Agreement and then (c) to the Servicer for payment of the fees payable to Servicer pursuant to the Servicing Agreement (to the extent not withheld from Income deposited into the Depository Account);

 

(ii)
second, to Administrative Agent, on behalf of Buyers, an amount equal to the Price Differential that has accrued and is outstanding as of such Remittance Date;

 

(iii)
third, to Administrative Agent, on behalf of Buyers, an amount equal to any other amounts then due and payable to Buyers or their respective Affiliates under any Transaction Document (including any outstanding Margin Deficits); and

 

(iv)
fourth, to Seller, the remainder, if any.

 

If, on any Remittance Date, the amounts deposited in the Depository Account shall be insufficient to make the payments required under (i) through (iii) above of this Article 5(b), and Seller does not otherwise make such payments on such Remittance Date, the same shall constitute an Event of Default hereunder.

 

(c)
So long as no Event of Default shall have occurred and be continuing, all Principal Payments on deposit in the Depository Account in respect of the Purchased Assets applied by the Depository no later than the second (2nd) Business Day following the Business Day on which such funds are deposited in the Depository Account as follows:

 

 

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(i)
first, if a Principal Payment in respect of any Purchased Asset has been made during the related Collection Period, to Administrative Agent, on behalf of Buyers, an amount equal to (A) during the Availability Period, the product of the amount of such Principal Payment, multiplied by the applicable Advance Rate and (B) during the Amortization Period, an amount equal to one hundred percent (100%) of such Principal Payment until the outstanding aggregate Purchase Price of all Purchased Assets has been reduced to zero (0);

 

(ii)
second; to Administrative Agent, on behalf of Buyers, an amount equal to any other amounts then due and payable to Buyers or their respective Affiliates under any Transaction Document (including any outstanding Margin Deficits); and

 

(iii)
third; to Seller, the remainder, if any.

 

(d)
If an Event of Default shall have occurred and be continuing, all Income (including, without limitation, any Principal Payments or any other amounts received, without regard to their source) on deposit in the Depository Account in respect of the Purchased Assets shall be applied as determined in Administrative Agent’s sole discretion pursuant to Article 13(b)(iii).

 

(e)
If the amounts remitted to Administrative Agent, on behalf of Buyers, as provided in Articles 5(b) and 5(c) are insufficient to pay all amounts due and payable from Seller to Buyers under this Agreement or any Transaction Document, whether due to the occurrence of an Event of Default or otherwise, Seller shall remain liable to Administrative Agent, on behalf of Buyers, for payment of all such amounts when due.

 

ARTICLE 6.

SECURITY INTEREST

 

(a)
Administrative Agent, Buyers and Seller intend that the Transactions hereunder be sales to Administrative Agent, on behalf of Buyers, of the Purchased Assets (other than for U.S. federal, state and local income or franchise tax purposes) and not loans from Buyers to Seller secured by the Purchased Assets. However, in order to preserve Administrative Agent’s and Buyers’ rights under this Agreement in the event that a court or other forum recharacterizes the Transactions hereunder as loans and as security for the performance by Seller of all of Seller’s obligations to Administrative Agent and Buyers under the Transaction Documents and the Transactions entered into hereunder, or in the event that a transfer of a Purchased Asset is otherwise ineffective to effect an outright transfer of such Purchased Asset to Administrative Agent, on behalf of Buyers, Seller hereby assigns, pledges and grants a security interest in all of its right, title and interest in, to and under the Purchased Items (as defined below) to Administrative Agent, on behalf of Buyers, to secure the payment of the Repurchase Price on all Transactions to which it is a party and all other amounts owing by it to Administrative Agent, on behalf of Buyers, hereunder, including, without limitation, amounts owing pursuant to Article 27, and under the other Transaction Documents, and to secure the obligation of Seller or its designee to service the Purchased Assets in conformity with Article 29 and any other obligation of Seller to Administrative Agent and Buyers (collectively, the “Repurchase Obligations”). Seller hereby acknowledges and agrees that each Purchased Asset serves as collateral for the Administrative Agent, on behalf of Buyers, under this Agreement and that Administrative Agent, on behalf of Buyers, has the right, upon the occurrence and continuance of an Event of Default, to realize on any or all of the Purchased Assets in order to satisfy the Seller’s obligations hereunder. Seller agrees to update in internal registers, books and records (including, without limitation, to mark its computer records and tapes) to reflect and evidence the interests granted to Administrative Agent, on behalf of Buyers, hereunder. All of Seller’s right, title and interest in, to and under each of the following items of property, whether now owned or hereafter acquired, now existing or hereafter created and wherever located, is hereinafter referred to as the “Purchased Items”:

 

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(i)
the Purchased Assets and all “securities accounts” (as defined in Article 8-501(a) of the UCC) to which any or all of the Purchased Assets are credited;

 

(ii)
any cash or cash equivalents delivered to Administrative Agent, on behalf of Buyers, in accordance with Articles 4(a).

 

(iii)
the Purchased Asset Documents, Servicing Agreements, Servicing Records, Servicing Rights, all servicing fees relating to the Purchased Assets, insurance policies relating to the Purchased Assets, and collection and escrow accounts and letters of credit relating to the Purchased Assets;

 

(iv)
all “general intangibles”, “accounts”, “chattel paper”, “investment property”, “instruments”, “securities accounts” and “deposit accounts”, each as defined in the UCC, relating to or constituting any and all of the foregoing;

 

(v)
any other items, amounts, rights or properties transferred or pledged by Seller to Administrative Agent, on behalf of Buyers, under any of the Transaction Documents; and

 

(vi)
all replacements, substitutions or distributions on or proceeds, payments, Income and profits of, and records (but excluding any financial models or other proprietary information) and files relating to any and all of any of the foregoing.

 

(b)
Intentionally Omitted.

 

(c)
The security interest of Administrative Agent, on behalf of Buyers, in the Purchased Items shall terminate only upon termination of Seller’s obligations under this Agreement and the documents delivered in connection herewith and therewith and the other Transaction Documents including, for the avoidance of doubt, Seller repurchasing each Purchased Asset. For the avoidance of doubt, Administrative Agent’s, on behalf of Buyers, security interest in the Purchased Items shall not terminate upon Administrative Agent’s determination of the Market Value of any Purchased Asset to be zero. Upon such termination, Administrative Agent shall deliver to Seller such UCC termination statements and other release documents as may be commercially reasonable and shall promptly return the Purchased Assets to Seller and reconvey the Purchased Items to Seller and release its security interest in the Purchased Items. For purposes of the grant of the security interest pursuant to this Article 6, this Agreement shall be deemed to constitute a security agreement under the New York Uniform Commercial Code (the “UCC”). Administrative Agent, on behalf of Buyers, shall have all of the rights and may exercise all of the remedies of a secured creditor under the UCC. In furtherance of the foregoing, (a) Administrative Agent, on behalf of Buyers, at Seller’s sole cost and expense, as applicable, shall cause to be filed in such locations as may be necessary to perfect and maintain perfection and priority of the security interest granted hereby, UCC financing statements and continuation statements (collectively, the “Filings”), and shall forward copies of such Filings to Seller upon completion thereof, and (b) Seller shall from time to time take such further actions as may be requested by Administrative Agent to maintain and continue the perfection and priority of the security interest granted hereby (including marking its records and files to evidence the interests granted to Administrative Agent, on behalf of Buyers, hereunder). Seller hereby authorizes Administrative Agent, on behalf of Buyers, to file a UCC financing statement naming Seller as debtor and Administrative Agent, on behalf of Buyers, as secured party and describing the collateral covered thereby as “all assets now owned or hereafter acquired.”

 

(d)
Seller hereby pledges to Administrative Agent, on behalf of Buyers, as security for the performance by Seller of the Repurchase Obligations and hereby grants to Administrative Agent, on behalf of Buyers, a first priority security interest in all of Seller’s right, title and interest in and to the

 

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Deposit Account and all amounts and property from time to time on deposit therein and all replacements, substitutions or distributions on or proceeds, payments and profits of, and records and files relating to, the Deposit Account.

 

ARTICLE 7.

PAYMENT, TRANSFER AND CUSTODY

 

(a)
On the Purchase Date for each Transaction, (i) ownership of the Purchased Asset shall be transferred to Administrative Agent, on behalf of Buyers, or its designee (including any Custodian) against the simultaneous transfer of the Purchase Price in immediately available funds to an account of Seller or an Acceptable Attorney pursuant to an escrow letter or other undertaking approved by Administrative Agent, in its sole discretion specified in the Confirmation relating to such Transaction and

(ii) Seller hereby sells, transfers, conveys and assigns to Administrative Agent, on behalf of Buyers, on a servicing-released basis all of Seller’s right, title and interest in and to such Purchased Asset, together with all related Servicing Rights. Subject to this Agreement, Seller may sell to Administrative Agent, on behalf of Buyers, repurchase from Administrative Agent, on behalf of Buyers, and re-sell Eligible Assets to Administrative Agent, on behalf of Buyers, but may not substitute other Eligible Assets for Purchased Assets.

 

(b)
Seller shall:

 

(i)
with respect to each Purchased Asset that is not a Table Funded Purchased Asset,

(A) not later than 1:00 p.m. (New York time) on the Business Day prior to the related Purchase Date, deliver and release to Custodian (with a copy to Administrative Agent), the Purchased Asset Documents together with any other documentation in respect of such Purchased Asset requested by Administrative Agent, on behalf of Buyers, in Administrative Agent’s sole discretion, and (B) on the Purchase Date, cause Custodian to deliver a Trust Receipt confirming receipt of such Purchased Asset Documents; and

 

(ii)
with respect to each Table Funded Purchased Asset, (A) not later than 1:00 p.m. (New York time) on the Purchase Date, deliver or cause Bailee to deliver to Administrative Agent, by electronic transmission, a true and complete copy of the related Mortgage Note with assignment in blank, loan agreement, Mortgage, Title Policy and executed Bailee Agreement, (B) not later than 1:00 p.m. (New York time) on the third (3rd) Business Day following the Purchase Date, deliver or Bailee to deliver and release to Custodian (with a copy to Administrative Agent), the Purchased Asset Documents and any other documentation in respect of such Purchased Asset requested by Administrative Agent, on behalf of Buyers, in its sole discretion, and (C) not later than two (2) Business Days following receipt of such Purchased Asset Documents by Custodian, cause Custodian to deliver a Trust Receipt confirming such receipt;

 

provided that if Seller cannot deliver, or cause to be delivered, any of the original Purchased Asset Documents required to be delivered as originals (excluding the Mortgage Note, and the Assignment of Mortgage, originals of which must be delivered at the time required under the provisions above), Seller shall deliver a photocopy thereof and an officer’s certificate of Seller certifying that such copy represents a true and correct copy of the original and shall use commercially reasonable efforts to obtain and deliver such original document within one hundred eighty (180) days after the related Purchase Date (or such longer period after the related Purchase Date to which Administrative Agent, on behalf of Buyers, may consent in its sole discretion, so long as Seller is, as certified in writing to Administrative Agent not less frequently than monthly, using its best efforts to obtain the original). After the expiration of such commercially reasonable efforts period, Seller shall deliver to Administrative Agent a certification that states, despite

 

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Seller’s commercially reasonable efforts, Seller was unable to obtain such original document, and thereafter Seller shall have no further obligation to deliver the related original document.

 

(c)
From time to time, Seller shall forward to Administrative Agent and to the Custodian additional copies of, originals of, documents evidencing any assumption, modification, consolidation or extension of a Purchased Asset approved in accordance with the terms of this Agreement, and upon receipt of any such other documents, the Custodian shall hold such other documents in accordance with the Custodial Agreement. With respect to all of the Purchased Assets delivered by Seller to Administrative Agent, on behalf of Buyers, its designee (including the Custodian), or the Acceptable Attorney, as the case may be, Seller shall have executed and delivered to Administrative Agent, on behalf of Buyers, the omnibus power of attorney substantially in the form of Exhibit IV attached hereto irrevocably appointing Administrative Agent, on behalf of Buyers, its attorney in fact with full power, if an Event of Default has occurred and is continuing, to (i) complete the endorsements of the Purchased Assets, including without limitation the Mortgage Notes, Assignments of Mortgages, and any transfer documents related thereto, (ii) record the Assignments of Mortgages, (iii) prepare and file and record each assignment of mortgage, (iv) take any action (including exercising voting and/or consent rights) with respect to intercreditor agreements or participation agreements, (v) complete the preparation and filing, in form and substance satisfactory to Administrative Agent, on behalf of Buyers, of such financing statements, continuation statements, and other UCC forms, as Administrative Agent may from time to time, reasonably consider necessary to create, perfect, and preserve Administrative Agent’s, on behalf of Buyers, security interest in the Purchased Assets, (vi) enforce Seller’s rights under the Purchased Assets purchased by Administrative Agent, on behalf of Buyers, pursuant to this Agreement and to, and

(vii) take such other steps as may be necessary or desirable to enforce Administrative Agent’s, on behalf of Buyers, rights against, under or with respect to such Purchased Assets and the related Purchased Asset Files and the Servicing Records. Administrative Agent, on behalf of Buyers, shall deposit the Purchased Asset Files representing the Purchased Assets, or direct that the Purchased Asset Files be deposited directly, with the Custodian, and the Purchased Asset Files shall be maintained in accordance with the Custodial Agreement. If a Purchased Asset File is not delivered to Administrative Agent, on behalf of Buyers, or its designee (including the Custodian), such Purchased Asset File shall be held in trust by Seller or its designee for the benefit of Administrative Agent, on behalf of Buyers, as the owner thereof. Seller or its designee shall maintain a copy of the Purchased Asset File and the originals of the Purchased Asset File not delivered to Administrative Agent, on behalf of Buyers, or its designee. The possession of the Purchased Asset File by Seller or its designee is at the will of Administrative Agent, on behalf of Buyers, for the sole purpose of servicing the related Purchased Asset, and such retention and possession by Seller or its designee is in a custodial capacity only. The books and records (including, without limitation, any computer records or tapes) of Seller or its designee shall be marked appropriately to reflect clearly the sale of the related Purchased Asset to Administrative Agent, on behalf of Buyers. Seller or its designee (including the Custodian) shall release its custody of the Purchased Asset File only in accordance with written instructions from Administrative Agent, on behalf of Buyers, unless such release is required as incidental to the servicing of the Purchased Assets, is in connection with a repurchase of any Purchased Asset by Seller or as otherwise required by law or set forth in the Custodial Agreement.

 

(d)
Administrative Agent, on behalf of Buyers, hereby grants to Seller a revocable option to exercise all voting and corporate rights with respect to the Purchased Assets (each, a “Revocable Option”) and to vote, take corporate actions and exercise any rights in connection with the Purchased Assets, so long as no Event of Default has occurred and is continuing. Such Revocable Option is not evidence of any ownership or other interest or right of Seller in any Purchased Asset. Upon the occurrence and during the continuation of a monetary Potential Event of Default or an Event of Default, and in each case subject to the provisions of the Purchased Asset Documents, the Revocable Option discussed above shall automatically terminate and thereafter Administrative Agent, on behalf of Buyers, shall be entitled to exercise all voting and corporate rights with respect to the Purchased Assets without

 

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regard to Seller’s instructions (including, but not limited to, if an Act of Insolvency shall occur with respect to Seller, to the extent Seller controls or is entitled to control selection of any servicer, Administrative Agent, on behalf of Buyers, may transfer any or all of such servicing to an entity satisfactory to Administrative Agent).

 

ARTICLE 8.

SALE, TRANSFER, HYPOTHECATION OR PLEDGE OF PURCHASED ASSETS

 

(a)
Title to all Purchased Items shall pass to Administrative Agent, on behalf of Buyers, on the applicable Purchase Date, and Administrative Agent, on behalf of Buyers, shall have free and unrestricted use of all Purchased Items, subject, however, to the terms of this Agreement. Subject to the provisions of Article 19, nothing in this Agreement or any other Transaction Document shall preclude Administrative Agent, on behalf of Buyers, from engaging in repurchase transactions with the Purchased Assets or otherwise selling, transferring, pledging, repledging, hypothecating, or rehypothecating the Purchased Items, and provided that no such transaction shall relieve Administrative Agent, on behalf of Buyers, of its obligations to transfer the Purchased Items to Seller pursuant to Article 3 of this Agreement or of Administrative Agent’s, on behalf of Buyers, obligation to credit or pay Income to, or apply Income to the obligations of, Seller pursuant to Article 5 hereof, or of Administrative Agent’s, on behalf of Buyers, obligations pursuant to Article 19 hereof.

 

(b)
Nothing contained in this Agreement or any other Transaction Document shall obligate Administrative Agent, on behalf of Buyers, to segregate any Purchased Assets delivered to Administrative Agent, on behalf of Buyers, by Seller. Notwithstanding anything to the contrary in this Agreement or any other Transaction Document, no Purchased Asset shall remain in the custody of Seller or an Affiliate of Seller.

 

ARTICLE 9.

REPRESENTATIONS AND WARRANTIES

 

(a)
Each of Administrative Agent, Buyers and Seller represents and warrants to the other that

(i) it is duly authorized to execute and deliver this Agreement, to enter into Transactions contemplated hereunder and to perform its obligations hereunder and has taken all necessary action to authorize such execution, delivery and performance, (ii) it will engage in such Transactions as principal (or, if agreed in writing, in the form of an annex hereto or otherwise, in advance of any Transaction by the other party hereto, as agent for a disclosed principal), (iii) the person signing this Agreement on its behalf is duly authorized to do so on its behalf (or on behalf of any such disclosed principal), (iv) it has obtained all authorizations of any Governmental Authority required in connection with this Agreement and the Transactions hereunder and such authorizations are in full force and effect and (v) the execution, delivery and performance of this Agreement and the Transactions hereunder will not violate any Requirement of Law applicable to it or its organizational documents or any agreement by which it is bound or by which any of its assets are affected. On the Purchase Date for any Transaction for the purchase of any Purchased Assets by Administrative Agent, on behalf of Buyers, from Seller and any Transaction hereunder and at all times while this Agreement and any Transaction thereunder is in effect, Administrative Agent, Buyers and Seller shall each be deemed to repeat all the foregoing representations made by it.

 

(b)
In addition to the representations and warranties in Article 9(a) above, Seller represents and warrants to Administrative Agent and Buyers as of the date of this Agreement and will be deemed to represent and warrant to Administrative Agent and Buyers as of the Purchase Date for the purchase of any Purchased Assets by Administrative Agent, on behalf of Buyers, from Seller and any Transaction

 

 

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thereunder that at all times while this Agreement and any Transaction thereunder is in effect, unless otherwise stated herein:

 

(i)
Organization. Seller is duly organized, validly existing and in good standing under the laws and regulations of the jurisdiction of Seller’s incorporation or organization, as the case may be, and is duly licensed, qualified, and in good standing in every state where such licensing or qualification is necessary for the transaction of Seller’s business, except where failure to so qualify could not be reasonably likely to have a Material Adverse Effect. Seller has the power to own and hold the assets it purports to own and hold, and to carry on its business as now being conducted and proposed to be conducted, and has the power to execute, deliver, and perform its obligations under this Agreement and the other Transaction Documents.

 

(ii)
Due Execution; Enforceability. The Transaction Documents have been or will be duly executed and delivered by Seller, for good and valuable consideration. The Transaction Documents constitute the legal, valid and binding obligations of Seller, enforceable against Seller in accordance with their respective terms subject to bankruptcy, insolvency, and other limitations on creditors’ rights generally and to equitable principles.

 

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

 

(iv)
Non-Contravention; Consents. Neither the execution and delivery of the Transaction Documents, nor consummation by Seller of the transactions contemplated by the Transaction Documents (or any of them), nor compliance by Seller with the terms, conditions and provisions of the Transaction Documents (or any of them) will (A) conflict with or result in a breach of any of the terms, conditions or provisions of the organizational documents of Seller, (B) violate or conflict with any contractual provisions of, or cause a default or event of default under, any indenture, loan agreement, mortgage, contract or other material agreement to which Seller is a party or by which Seller may be bound to which Seller is now a party, (C) result in the creation or imposition of any Lien or any other encumbrance of any of the assets of Seller, other than pursuant to the Transaction Documents, (D) conflict with any judgment or order, writ, injunction, decree or demand of any court applicable to Seller, or (E) conflict any applicable Requirement of Law to the extent that such conflict or breach referred to in clause (E) would have a Material Adverse Effect upon Seller’s ability to perform its obligations hereunder.

 

(v)
Litigation; Requirements of Law. There is no action, suit, proceeding, investigation, or arbitration pending or, to the Knowledge of Seller, threatened against Seller or any of its assets, nor is there any action, suit, proceeding, investigation, or arbitration pending or threatened against Seller that (A) may, individually or in the aggregate, result in any Material Adverse Effect, (B) may have an adverse effect on the validity of the Transaction Documents or any action taken or to be taken in connection with the obligations of Seller under any of the Transaction Documents or (C) requires filing with the SEC in accordance with the 1934 Act or any rules thereunder. Seller is in compliance in all material respects with all Requirements of Law. Seller is not in default in any material respect with respect to any judgment, order, writ, injunction, decree, rule or regulation of any arbitrator or Governmental Authority.

 

(vi)
No Broker. Seller has not dealt with any broker, investment banker, agent, or other Person (other than Goldman Sachs Bank USA or its Affiliate) who may be entitled to any commission or compensation in connection with the sale of Purchased Assets pursuant to any of the Transaction Documents.

 

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(vii)
Good Title to Purchased Assets. Immediately prior to the purchase of any Purchased Assets by Administrative Agent, on behalf of Buyers, from Seller, such Purchased Assets are free and clear of any lien, encumbrance or impediment to transfer (including any “adverse claim” as defined in Article 8 102(a)(1) of the UCC), and Seller is the record and beneficial owner of and has good and marketable title to and the right to sell and transfer such Purchased Assets to Administrative Agent, on behalf of Buyers, and, upon transfer of such Purchased Assets to Administrative Agent, on behalf of Buyers, Administrative Agent, on behalf of Buyers, shall be the equitable owner of such Purchased Assets free of any adverse claim. In the event the related Transaction is recharacterized as a secured financing of the Purchased Assets, the provisions of this Agreement are effective to create in favor of Administrative Agent, on behalf of Buyers, a valid security interest in all rights, title and interest of Seller in, to and under the Purchased Assets and Administrative Agent, on behalf of Buyers, shall have a valid, perfected first priority security interest in the Purchased Assets (and without limitation on the foregoing, Administrative Agent, on behalf of Buyers, as entitlement holder, shall have a “security entitlement” to the Purchased Assets).

 

(viii)
No Material Adverse Effect; No Potential Events of Default. To Seller’s Knowledge, there are no post-Transaction facts or circumstances that have a Material Adverse Effect on any Purchased Asset that Seller has not notified Administrative Agent in writing. No Potential Event of Default or Event of Default exists under or with respect to the Transaction Documents.

 

(ix)
Authorized Representatives. The duly authorized representatives of Seller are listed on, and true signatures of such authorized representatives are set forth on, Exhibit II attached to this Agreement.

 

(x)
Representations and Warranties Regarding Purchased Assets; Delivery of Purchased Asset File.

 

(A)
As of the date hereof, Seller has not assigned, pledged, or otherwise conveyed or encumbered any Purchased Asset to any other Person, and immediately prior to the sale of such Purchased Asset to Administrative Agent, on behalf of Buyers, Seller was the sole owner of such Purchased Asset and had good and marketable title thereto, free and clear of all Liens, and any impediment to transfer (including any “adverse claim” as defined in Section 8-102(a)(1) of the UCC), in each case except for Liens to be released simultaneously with the sale to Administrative Agent, on behalf of Buyers, hereunder.

 

(B)
The provisions of this Agreement and the related Confirmation are effective to either (1) constitute a sale of Purchased Items to Administrative Agent, on behalf of Buyers, or (2) in the event the related Transaction is recharacterized as a secured financing of the Purchased Assets, to create in favor of Administrative Agent, on behalf of Buyers, a legal, valid and enforceable security interest in all right, title and interest of Seller in, to and under the Purchased Items, and in such event, Administrative Agent, on behalf of Buyers, shall have a valid, perfected first priority security interest in the Purchased Items (and without limitation on the foregoing, Administrative Agent, on behalf of Buyers, as entitlement holder, shall have a “security entitlement” to the Purchased Items).

 

(C)
Upon receipt by the Custodian of each Mortgage Note endorsed in blank by a duly authorized officer of Seller, either a purchase shall have been completed by

 

 

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Administrative Agent, on behalf of Buyers, of such Mortgage Note, or Administrative Agent, on behalf of Buyers, shall have a valid and fully perfected first priority security interest in all right, title and interest of Seller in the Purchased Items described therein.

 

(D)
Each of the representations and warranties made in respect of the Purchased Assets pursuant to Exhibit V are true, complete and correct, except to the extent disclosed in a Requested Exceptions Report.

 

(E)
Upon the filing of financing statements on Form UCC-1 naming Administrative Agent, on behalf of Buyers, as “Secured Party”, Seller as “Debtor” and describing the Purchased Items, in the jurisdiction and recording office listed on Exhibit

X attached hereto, the security interests granted hereunder in that portion of the Purchased Items which can be perfected by filing under the UCC will constitute fully perfected security interests under the UCC in all right, title and interest of Seller in, to and under such Purchased Items.

 

(F)
Upon execution and delivery of the Depository Agreement, Administrative Agent, on behalf of Buyers, shall either be the owner of, or have a valid and fully perfected first priority security interest in, the Depository Account and all amounts at any time on deposit therein.

 

(G)
Upon execution and delivery of the Depository Agreement, Administrative Agent, on behalf of Buyers, shall either be the owner of, or have a valid and fully perfected first priority security interest in, the “investment property” and all “deposit accounts” (each as defined in the Uniform Commercial Code) comprising Purchased Items or any after-acquired property related to such Purchased Items.

 

(H)
With respect to each Purchased Asset purchased by Seller or an Affiliate of Seller from a Transferor, (a) such Purchased Asset was acquired and transferred pursuant to a Purchase Agreement, (b) such Transferor received reasonably equivalent value in consideration for the transfer of such Purchased Asset, (c) no such transfer was made for or on account of an antecedent debt owed by such Transferor to Seller or an Affiliate of Seller, (d) no such transfer is or may be voidable or subject to avoidance under the Bankruptcy Code, and (e) if Seller acquired the Purchased Asset from a Transferor, unless such Transferor is a wholly owned Subsidiary of Guarantor, Seller has delivered to Administrative Agent, on behalf of Buyers, an opinion of counsel regarding the true sale of the purchase of such Asset by Seller and, if such Asset was acquired by Seller’s Affiliate from a Transferor, the true sale of the purchase of the Asset by the Affiliate of Seller from such Transferor, which opinions shall be in form and substance reasonably satisfactory to Administrative Agent and (f) the representations and warranties made by such Transferor to Seller or such Affiliate in such Purchase Agreement are hereby incorporated herein mutatis mutandis and are hereby remade by Seller to Administrative Agent and Buyers on each date as of which they speak in such Purchase Agreement. Seller or such Affiliate of Seller has been granted a security interest in each such Purchased Asset, filed one or more UCC financing statements against the Transferor to perfect such security interest, and assigned such financing statements in blank and delivered such assignments to Administrative Agent, on behalf of Buyers, or Custodian.

 

(I)
Seller has complied with all material requirements of the Custodial Agreement with respect to each Purchased Asset, including delivery to Custodian of all required Purchased Asset Documents. Except to the extent disclosed in a Requested

 

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Exceptions Report, Seller or its designee is in possession of a complete, true and accurate Purchased Asset File with respect to each Purchased Asset, except for such documents the originals of which have been delivered to the Custodian.

 

(J)
The Purchased Assets constitute the following, as applicable, as defined in the UCC: a general intangible, instrument, investment property, security, deposit account, financial asset, uncertificated security, securities account, or security entitlement. Seller has not authorized the filing of and is not aware of any UCC financing statements filed against Seller as debtor that include the Purchased Assets, other than any financing statement that has been terminated or filed pursuant to this Agreement.

 

(xi)
Adequate Capitalization; No Fraudulent Transfer. Seller has, as of each Purchase Date, adequate capital for the normal obligations foreseeable in a business of its size and character and in light of its contemplated business operations. Neither the Transaction Documents nor any Transaction thereunder are entered into in contemplation of insolvency or with intent to hinder, delay or defraud any of Seller’s creditors. The transfer of the Purchased Assets subject hereto and the obligation to repurchase such Purchased Assets is not undertaken with the intent to hinder, delay or defraud any of Seller’s creditors. As of the Purchase Date, Seller is not insolvent within the meaning of Section 101(32) of the Bankruptcy Code or any successor provision thereof, is generally able to pay, and as of the date hereof is paying, its debts as they become due, and the transfer and sale of the Purchased Assets pursuant hereto and the obligation to repurchase such Purchased Asset (A) will not cause the liabilities of Seller to exceed the assets of Seller, (B) will not result in Seller having unreasonably small capital, and (C) will not result in debts that would be beyond Seller’s ability to pay as the same mature. Seller received reasonably equivalent value in exchange for the transfer and sale of the Purchased Assets and the Purchased Items subject hereto. No petition in bankruptcy has been filed against Seller in the last ten (10) years, and Seller has not in the last ten (10) years made an assignment on behalf of creditors or taken advantage of any debtors relief laws. Seller has only entered into agreements on terms that would be considered arm’s length and otherwise on terms consistent with other similar agreements with other similarly situated entities.

 

(xii)
Governmental Approvals. No order, consent, approval, license, authorization or validation of, or filing, recording or registration by Seller with, or exemption by, any Governmental Authority is required to authorize, or is required in connection with, (A) the execution, delivery and performance of any Transaction Document to which Seller is or will be a party, (B) the legality, validity, binding effect or enforceability of any such Transaction Document against Seller or (C) the consummation of the transactions contemplated by this Agreement (other than consents, approvals and filings that have been obtained or made as applicable, and the filing of certain financing statements in respect of certain security interests).

 

(xiii)
Organizational Documents. Seller has delivered to Administrative Agent, on behalf of Buyers, certified copies of its organization documents, together with all amendments thereto, if any.

 

(xiv)
No Encumbrances. There are (i) no outstanding rights, options, warrants or agreements on the part of Seller for a purchase, sale or issuance, in connection with the Purchased Assets, (ii) no agreements on the part of Seller to issue, sell or distribute the Purchased Assets, and (iii) no obligations on the part of Seller (contingent or otherwise) to purchase, redeem or otherwise acquire any securities or interest therein, except as contemplated by the Transaction Documents.

 

 

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(xv)
Federal Regulations. Seller is not required to register as an “investment company,” or a company “controlled by an investment company,” within the meaning of the Investment Company Act of 1940, as amended (the “Investment Company Act”).

 

(xvi)
Taxes. Seller has timely filed all required federal income tax returns and all other material Tax returns, domestic and foreign, required to be filed by it and has paid all Taxes (whether or not shown on a return), which have become due, except for Taxes that are being contested in good faith by appropriate proceedings diligently conducted and for which appropriate reserves have been established in accordance with GAAP. Seller has satisfied all of its withholding Tax obligations. No Tax Liens are currently filed against any assets of Seller and no claims are currently being asserted in writing against Seller with respect to Taxes (except for liens and with respect to Taxes not yet due and payable or liens or claims with respect to Taxes that are being contested in good faith and for which adequate reserves have been established in accordance with GAAP).

 

(xvii)
Judgments/Bankruptcy. Except as disclosed in writing to Administrative Agent, there are no judgments against Seller unsatisfied of record or docketed in any court located in the United States of America and no Act of Insolvency has ever occurred with respect to Seller.

 

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

 

(xix)
Full and Accurate Disclosure. No information contained in the Transaction Documents, or any written statement furnished by or on behalf of Seller pursuant to the terms of the Transaction Documents, contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements contained herein or therein not misleading in light of the circumstances under or context in which they were made.

 

(xx)
Financial Information. All financial data concerning Seller and, to Seller’s Knowledge, the Purchased Assets that has been delivered by or on behalf of Seller to Administrative Agent, on behalf of Buyers, is true, complete and correct in all material respects. All financial data concerning Seller has been prepared fairly in accordance with GAAP. Since the delivery of such data, except as otherwise disclosed in writing to Administrative Agent, on behalf of Buyers, there has been no change in the financial position of Seller or, to Seller’s Knowledge, the Purchased Assets, or in the results of operations of Seller, which change is reasonably likely to have a Material Adverse Effect on Seller.

 

(xxi)
Intentionally Omitted.

 

(xxii)
Servicing Agreements. Seller has delivered to Administrative Agent, on behalf of Buyers, copies of all Servicing Agreements pertaining to the Purchased Assets and to the Knowledge of Seller, as of the date of this Agreement and as of the Purchase Date for the purchase of any Purchased Assets subject to a Servicing Agreement, each such Servicing Agreement is in full force and effect in accordance with its terms and no default or event of default exists thereunder.

 

 

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

 

(xxiv)
Patriot Act.

 

(a)
Seller is in compliance with the (A) the Trading with the Enemy Act, as amended, and each of the foreign assets control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) and any other applicable enabling legislation or executive order relating thereto, (B) the USA Patriot Act, and (C) the United States Foreign Corrupt Practices Act of 1977, as amended, and any other applicable anti-bribery laws and regulations. No part of the proceeds of any Transaction will be used, directly or indirectly, for any payments to any governmental official or employee, political party, official of a political party, candidate for political office, or anyone else acting in an official capacity, in order to obtain, retain or direct business or obtain any improper advantage, in violation of the United States Foreign Corrupt Practices Act of 1977, as amended.

 

(b)
Seller agrees that, from time to time upon the prior written request of Administrative Agent, it shall (A) execute and deliver such further documents, provide such additional information and reports and perform such other acts as Administrative Agent may reasonably request in order to insure compliance with the provisions hereof (including, without limitation, compliance with the USA Patriot Act and to fully effectuate the purposes of this Agreement and (B) provide such opinions of counsel concerning matters relating to this Agreement as Administrative Agent may reasonably request; provided, however, that nothing in this Article 9(b)(xxiv) shall be construed as requiring Administrative Agent to conduct any inquiry or decreasing Seller’s responsibility for its statements, representations, warranties or covenants hereunder. In order to enable Administrative Agent, Buyers and their respective Affiliates to comply with any anti-money laundering program and related responsibilities including, but not limited to, any obligations under the USA Patriot Act and regulations thereunder, Seller on behalf of itself and its Affiliates makes the foregoing representations and covenants to Administrative Agent, Buyers, and their respective Affiliates, that neither Seller, nor, any of its Affiliates, is a Prohibited Investor and Seller is not acting on behalf of or for the benefit of any Prohibited Investor. Seller agrees to promptly notify Administrative Agent, on behalf of Buyers, or a person appointed by Administrative Agent, on behalf of Buyers, to administer their anti-money laundering program, if applicable, of any change in information affecting this representation.

 

(xxv)
Reserved.

 

(xxvi)
Insider. Seller is not an “executive officer,” “director,” or “person who directly or indirectly or acting through or in concert with one or more persons owns, controls, or has the power to vote more than 10% of any class of voting securities” (as those terms are defined in 12

U.S.C. § 375(b) or in regulations promulgated pursuant thereto) of Administrative Agent or any Buyer, of a bank holding company of which Administrative Agent or Buyers is a Subsidiary, or of any Subsidiary, of a bank holding company of which Administrative Agent or any Buyer is a

 

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Subsidiary, of any bank at which Administrative Agent or any Buyer maintains a correspondent account or of any lender which maintains a correspondent account with Administrative Agent or any Buyer.

 

(xxvii)
Office of Foreign Assets Control. Seller warrants, represents and covenants that neither Seller nor any of its Affiliates are or will be an entity or Person that is or is owned or controlled by a Person that is the subject of any sanctions administered or enforced by the U.S. Department of Treasury’s Office of Foreign Asset Control, the United Nations Security Council, the European Union or Her Majesty’s Treasury (collectively, “Sanctions”). Seller covenants and agrees that, with respect to the Transactions under this Agreement, none of Seller or, to Seller’s Knowledge, any of its Affiliates will conduct any business, nor engage in any transaction, Assets or dealings, with any Person who is the subject of Sanctions. Seller further covenants and agrees that it will not, directly or indirectly, use the proceeds of the facility, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other Person to fund or facilitate any activities or business of or with any Person or in any country or territory that, at the time of such funding or facilitation, is the subject of Sanctions.

 

(xxviii)
Notice Address; Jurisdiction of Organization. On the date of this Agreement, Seller’s address for notices is as specified on Annex I. Seller’s jurisdiction of organization is Delaware. The location where Seller keeps its books and records, including all computer tapes and records relating to the Purchased Items, is its notice address. Seller may change its address for notices and for the location of its books and records by giving Administrative Agent written notice of such change.

 

(xxix)
Anti-Money Laundering Laws. Seller either (1) is entirely exempt from or (2) has otherwise fully complied with all applicable anti-money laundering laws and regulations (collectively, the “Anti-Money Laundering Laws”), by (A) establishing an adequate anti-money laundering compliance program as required by the Anti-Money Laundering Laws, (B) conducting the requisite due diligence in connection with the origination of each Purchased Asset for purposes of the Anti-Money Laundering Laws, including with respect to the legitimacy of the related obligor (if applicable) and the origin of the assets used by such obligor to purchase the property in question, and (C) maintaining sufficient information to identify the related obligor (if applicable) for purposes of the Anti-Money Laundering Laws.

 

(xxx)
Ownership of Property. Seller does not own, and has not ever owned, any assets other than (A) the Purchased Assets, and (B) such incidental personal property related thereto.

 

(xxxi)
Ownership. Seller is and shall remain at all times a wholly owned direct or indirect Subsidiary of Guarantor.

 

(xxxii)
Compliance with ERISA. (a) Neither Seller nor Guarantor has any employees as of the date of this Agreement; (b) each of Seller and Guarantor either (i) qualifies as a VCOC or a REOC, (ii) complies with an exception set forth in the Plan Asset Regulations such that the assets of such Person would not be subject to Title I of ERISA and/or Section 4975 of the Code, or

(iii) is not deemed to hold “plan assets” within the meaning of the Plan Asset Regulations that are subject to ERISA; and (c) assuming that no portion of the Purchased Assets are funded by Buyers with “plan assets” within the meaning of the Plan Asset Regulations, none of the transactions contemplated by the Transaction Documents will constitute a nonexempt prohibited transaction (as such term is defined in Section 4975 of the Code or Section 406 of ERISA) that could subject the Administrative Agent or any Buyer to any tax or penalty imposed under Section 4975 of the Code or Section 502(i) of ERISA.

 

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(xxxiii)
Servicing Agreements. Any Servicing Agreement related to a Purchased Asset, including without limitation, the Primary Servicing Agreement, may be terminated at will by Seller without payment of any penalty or fee.

 

ARTICLE 10.

NEGATIVE COVENANTS OF SELLER

 

On and as of the date hereof and each Purchase Date and until this Agreement is no longer in force with respect to any Transaction, Seller shall not without the prior written consent of Administrative Agent, on behalf of Buyers:

 

(a)
take any action that would directly or indirectly impair or adversely affect Administrative Agent’s, on behalf of Buyers, title to the Purchased Assets;

 

(b)
transfer, assign, convey, grant, bargain, sell, set over, deliver or otherwise dispose of, or pledge or hypothecate, directly or indirectly, any interest in the Purchased Assets (or any of them) to any Person other than Administrative Agent, on behalf of Buyers, or engage in repurchase transactions or similar transactions with respect to the Purchased Assets (or any of them) with any Person other than Administrative Agent, on behalf of Buyers, unless and until such Purchased Asset is repurchased by Seller in accordance with this Agreement;

 

(c)
modify in any material respect any Servicing Agreement to which it is a party;

 

(d)
create, incur or permit to exist any Lien in or on any of its property, assets, revenue, the Purchased Assets, the other Purchased Items, whether now owned or hereafter acquired, other than the Liens granted by Seller pursuant to Article 6 of this Agreement and the Lien granted by Pledgor under the Pledge and Security Agreement or unless and until such Purchased Asset relating to such Purchased Items is repurchased by Seller in accordance with this Agreement;

 

(e)
take any action or permit such action to be taken which would result in a Change of Control;

 

(f)
consent or assent to, or permit the Primary Servicer or servicer to make, any Significant Modification relating to the Purchased Assets without the prior written consent of Administrative Agent, on behalf of Buyers, which shall be granted or denied in Administrative Agent’s sole discretion;

 

(g)
permit the organizational documents or organizational structure of Seller to be amended without the prior written consent of Administrative Agent, which consent shall not, prior to the occurrence and during the continuance of a Default or an Event of Default, be unreasonably withheld, conditioned or delayed, other than with respect to special purpose entity provisions, for which consent shall be at Administrative Agent’s, on behalf of Buyers, sole discretion;

 

(h)
acquire or maintain any right or interest in any Purchased Asset or Underlying Mortgaged Property that is senior to, junior to or pari passu with the rights and interests of Administrative Agent, on behalf of Buyers, therein under this Agreement and the other Transaction Documents unless such right or interest becomes a Purchased Asset hereunder or unless such right or interest exists as of the Purchase Date for such Purchased Asset and is approved by Administrative Agent in writing;

 

(i)
use any part of the proceeds of any Transaction hereunder for any purpose which violates, or would be inconsistent with, the provisions of Regulation T, U or X of the Board of Governors of the Federal Reserve System;

 

 

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(j)
incur any Indebtedness except as provided in Article 12(i) or otherwise cease to be a Single-Purpose Entity;

 

(k)
intentionally omitted;

 

(l)
take any action, cause, allow, or permit any of the Seller, Pledgor or Guarantor to be required to register as an “investment company”, or a company “controlled by an investment company”, within the meaning of the Investment Company Act, or to violate any provisions of the Investment Company Act, including Section 18 thereof or any rules promulgated thereunder;

 

(m)
after the occurrence and during the continuance of any Potential Event of Default or Event of Default, make any distribution, payment on account of, or set apart assets for, a sinking or other analogous fund for the purchase, redemption, defeasance, retirement or other acquisition of any equity or ownership interest of Seller, whether now or hereafter outstanding, or make any other distribution in respect thereof, either directly or indirectly, whether in cash or property or in obligations of Seller; provided that, so long as no monetary Event of Default referenced in Articles 13(a)(i), (ii), (iii) or (iv) in an amount equal to or greater than $500,000 shall have occurred and be continuing, Seller may distribute the minimum amount of cash required to be distributed so that Guarantor can both (i) maintain its status as a “real estate investment trust” under Sections 856 through 860 of the Code and (ii) avoid the payment of any income or excise taxes imposed under Section 857(b)(1), 857(b)(3) or 4981 or the Code;

 

(n)
make any future advances under any Purchased Asset to any underlying obligor that are not provided for in the related Purchased Asset Documents;

 

(o)
seek its dissolution, liquidation or winding up, in whole or in part; or

 

(p)
permit, at any time, a breach of the Concentration Limit.

 

ARTICLE 11.

AFFIRMATIVE COVENANTS OF SELLER

 

On and as of the date hereof and each Purchase Date and until this Agreement is no longer in force with respect to any Transaction:

 

(a)
Seller shall promptly notify Administrative Agent of any material adverse change in the business operations and/or financial condition of Seller, Pledgor or Guarantor; provided, however, that nothing in this Article 11 shall relieve Seller of its obligations under this Agreement.

 

(b)
Seller shall provide Administrative Agent with copies of such documents as Administrative Agent may request evidencing the truthfulness of the representations set forth in Article 9.

 

(c)
Seller shall (i) defend the right, title and interest of Administrative Agent, on behalf of Buyers, in and to the Purchased Items against, and take such other action as is necessary to remove, the Liens, security interests, claims and demands of all Persons (other than Liens created in favor of Administrative Agent, on behalf of Buyers, pursuant to the Transaction Documents) and (ii) at Administrative Agent’s reasonable request, take all action necessary to ensure that Administrative Agent, on behalf of Buyers, will have a first priority security interest in the Purchased Assets subject to any of the Transactions in the event such Transactions are recharacterized as secured financings.

 

(d)
Seller will permit Administrative Agent, any Buyer or their respective designated representative to inspect Seller’s records with respect to the Purchased Items and the conduct and

 

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operation of its business related thereto upon reasonable prior written notice from Administrative Agent, any Buyer or their respective designated representative, at such reasonable times and with reasonable frequency not to exceed twice per calendar year unless a Potential Event of Default or Event of Default has occurred and is continuing, and to make copies of extracts of any and all thereof, subject to the terms of any confidentiality agreement between such Buyer and/or Administrative Agent and Seller and applicable law, and if no such confidentiality agreement then exists between such Buyer and/or Administrative Agent and Seller, Administrative Agent, such Buyer and Seller shall act in accordance with customary market standards regarding confidentiality and applicable law. Administrative Agent and any Buyer shall act in a commercially reasonable manner in requesting and conducting any inspection relating to the conduct and operation of Seller’s business. So long as no Potential Event of Default or Event of Default has occurred and is continuing, any such inspection shall be at the applicable Buyer’s cost and expense.

 

(e)
If Seller shall at any time become entitled to receive or shall receive any rights, whether in addition to, in substitution of, as a conversion of, or in exchange for a Purchased Asset, or otherwise in respect thereof, Seller shall accept the same as Administrative Agent’s, on behalf of Buyers, agent, hold the same in trust for Administrative Agent, on behalf of Buyers, and deliver the same forthwith to the Custodian in the exact form received, duly endorsed by Seller to Administrative Agent, on behalf of Buyers, if required, together with all related and necessary duly executed transfer documents to be held by Administrative Agent, on behalf of Buyers, hereunder as additional collateral security for the Transactions. If any sums of money or property so paid or distributed in respect of the Purchased Assets shall be received by Seller, Seller shall, until such money or property is paid or delivered to Buyers, hold such money or property in trust for Buyers, segregated from other funds of Seller, as additional collateral security for the Transactions.

 

(f)
At any time from time to time upon the reasonable request of Administrative Agent, on behalf of Buyers, at the sole expense of Seller, Seller will promptly and duly execute and deliver such further instruments and documents and take such further actions as Administrative Agent may request for the purposes of obtaining or preserving the full benefits of this Agreement including the perfected, first priority security interest required hereunder, (ii) ensure that such security interest remains fully perfected at all times and remains at all times first in priority as against all other creditors of such Seller (whether or not existing as of the Closing Date, any Purchase Date or in the future) and (iii) obtain or preserve the rights and powers herein granted (including, among other things, filing such UCC financing statements as Administrative Agent may request). If any amount payable under or in connection with any of the Purchased Items shall be or become evidenced by any promissory note, other instrument or certificated security, such note, instrument or certificated security shall be immediately delivered to Administrative Agent, duly endorsed in a manner satisfactory to Administrative Agent, to be itself held as a Purchased Item pursuant to this Agreement, and the documents delivered in connection herewith.

 

(g)
Seller shall provide, or cause to be provided, to Administrative Agent, on behalf of Buyers, the following financial and reporting information:

 

(i)
Within fifteen (15) calendar days after each month-end, a monthly reporting package substantially in the form of Exhibit III-A attached hereto (the “Monthly Reporting Package”);

 

(ii)
Within forty-five (45) calendar days after the last day of each of the first three (3) fiscal quarters in any fiscal year, a quarterly reporting package substantially in the form of Exhibit III-B attached hereto (the “Quarterly Reporting Package”); provided, however, that the financial statements to be attached as Exhibit 2 to the Covenant Compliance Certificate to be

 

 

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included in such Quarterly Reporting Package shall be deemed to have been delivered on the date such items are made publicly available on the SEC website;

 

(iii)
Within ninety (90) calendar days after the last day of its fiscal year, an annual reporting package substantially in the form of Exhibit III-C attached hereto (the “Annual Reporting Package”); provided, however, that the financial statements to be attached as Exhibit 2 to the Covenant Compliance Certificate to be included in to such Annual Reporting Package shall be deemed to have been delivered on the date such items are made publicly available on the SEC website; and

 

(iv)
Upon Administrative Agent’s request:

 

(A)
such other information regarding the financial condition, operations or business of Seller, Guarantor or any Mortgagor in respect of a Purchased Asset as Administrative Agent may reasonably request; provided, however, that the failure of Seller to timely deliver any such information regarding a Mortgagor as a result of the failure of such Mortgagor to timely deliver to Seller such information so requested of Mortgagor by Seller shall not be an Event of Default.

 

(h)
Seller shall make a representative available to Administrative Agent every month for attendance at a telephone conference, the date of which to be mutually agreed upon by Administrative Agent and Seller, regarding the status of each Purchased Asset, Seller’s compliance with the requirements of Articles 11 and 12, and any other matters relating to the Transaction Documents or Transactions that Administrative Agent, on behalf of Buyers, wishes to discuss with Seller.

 

(i)
Seller shall to at all times (i) comply with all contractual obligations, (ii) comply in all respects with all laws, ordinances, rules, regulations and orders (including, without limitation, Environmental Laws) of any Governmental Authority or any other federal, state, municipal or other public authority having jurisdiction over Seller or any of its assets and Seller shall do or cause to be done all things necessary to preserve and maintain in full force and effect its legal existence, and all licenses material to its business and (iii) maintain and preserve its legal existence and all of its material rights, privileges, licenses and franchises necessary for the operation of its business (including, without limitation, preservation of all lending licenses held by Seller and of Seller’s status as a “qualified transferee” (however denominated) under all documents which govern the Purchased Assets).

 

(j)
Seller shall or shall cause Guarantor to at all times keep proper books of records and accounts in which full, true and correct entries shall be made of its transactions fairly in accordance with GAAP, and set aside on its books from its earnings for each fiscal year all such proper reserves in accordance with GAAP.

 

(k)
Seller shall observe, perform and satisfy all the terms, provisions, covenants and conditions required to be observed, performed or satisfied by it, and shall pay when due all costs, fees and expenses required to be paid by it under the Transaction Documents, including, but not limited to, the fees and expenses of the Custodian and the Acceptable Attorney, Depository and each servicer (including, without limitation, the Primary Servicer) of any or all of the Purchased Assets, the Draw Fee, the Exit Fee, the Amortization Period Fee and the Renewal Period Fee, as applicable.

 

(l)
Seller will continue to be a U.S. Person that is a partnership for U.S. federal income tax purposes, or a disregarded entity of a U.S. Person for U.S. federal income tax purposes. Seller shall pay and discharge all Taxes, levies, liens and other charges on its assets and on the Purchased Items that, in each case, in any manner would create any Lien upon the Purchased Items, other than (A) Taxes that are

 

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not yet due and payable and (B) any such Taxes that are being appropriately contested in good faith by appropriate proceedings diligently conducted and with respect to which adequate reserves have been provided in accordance with GAAP; provided that such contest operates to suspend collection of the contested Tax and enforcement of a Lien.

 

(m)
Seller shall advise Administrative Agent in writing of the opening of any new chief executive office or the closing of any such office of Seller, Pledgor or Guarantor and of any change in Seller’s, Pledgor’s or Guarantor’s name or the places where the books and records pertaining to the Purchased Assets are held not less than fifteen (15) Business Days prior to taking any such action.

 

(n)
Seller will maintain records with respect to the Purchased Items and the conduct and operation of its business with no less a degree of prudence than if the Purchased Items were held by Seller for its own account.

 

(o)
Upon reasonable notice (unless a Default or an Event of Default shall have occurred and is continuing, in which case, no prior notice shall be required), during normal business hours, Seller shall allow Administrative Agent, on behalf of Buyers, to (i) review any operating statements, occupancy status and other property level information with respect to the underlying real estate directly or indirectly securing or supporting the Purchased Assets that either is in Seller’s possession or is available to Seller,

(ii) examine, copy (at Buyers’ expense) and make extracts from its books and records, to inspect any of its Properties, and (iii) discuss Seller’s business and affairs with its Responsible Officers.

 

(p)
Seller shall deliver to Administrative Agent and Buyers the opinions referenced in

Section 3(a)(vii) hereof no later than ten (10) Business Days after the Closing Date.

 

(q)
Intentionally omitted.

 

(r)
Seller shall continue to engage in business of the same general type as now conducted by it or otherwise as approved by Administrative Agent, on behalf of Buyers, prior to the date hereof.

 

(s)
Seller shall cause each servicer of a Purchased Asset to provide to Administrative Agent via electronic transmission, promptly upon request by Administrative Agent, a Servicing Tape for the most recently ended quarter (or any portion thereof).

 

(t)
With respect to each Eligible Asset to be purchased hereunder, Seller shall notify Administrative Agent in writing of the creation of any right or interest in such Eligible Asset or related Underlying Mortgaged Property that is senior to or pari passu with the rights and interests that are to be transferred to Administrative Agent, on behalf of Buyers, under this Agreement and the other Transaction Documents, and whether any such interest will be held or obtained by Seller or an Affiliate of Seller.

 

(u)
Reserved.

 

(v)
With respect to each Purchased Asset, Seller shall take all action necessary or required by the Transaction Documents, Purchased Asset Documents and each and every Requirement of Law, or requested by Administrative Agent, on behalf of Buyers, to perfect, protect and more fully evidence Administrative Agent’s, on behalf of Buyers, ownership of and first priority perfected security interest in such Purchased Asset and related Purchased Asset Documents, including executing or causing to be executed such other instruments or notices as may be necessary or appropriate and filing and maintaining effective UCC financing statements, continuation statements and assignments and amendments thereto. Seller shall not take any action to cause any Purchased Asset that is not evidenced by an instrument or chattel paper (as defined in the UCC) to be so evidenced. If a Purchased Asset becomes evidenced by an

 

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instrument or chattel paper, the same shall be immediately delivered to Administrative Agent or to Custodian on behalf of Buyers, together with endorsements required by Administrative Agent, on behalf of Buyers.

 

(w)
No later than thirty (30) days after Administrative Agent’s request (or such other time period as determined by Administrative Agent), Seller shall procure and deliver to Administrative Agent, on behalf of Buyers, an Appraisal relating to any Purchased Asset at Seller’s sole cost and expense; provided, however, so long as no Event of Default has occurred and is continuing, Seller shall only be responsible for the costs and expenses associated with one (1) Appraisal per Purchased Asset during any twelve (12) month period. Notwithstanding anything herein to the contrary, Administrative Agent, on behalf of Buyers, shall have the unlimited right, at any time and from time to time, to obtain an Appraisal relating to any Purchased Asset at its own cost and expense.

 

(x)
Seller shall provide notice to Administrative Agent in writing of any of the following, together with a certificate of a Responsible Officer of Seller setting forth details of such occurrence and any action Seller has taken or proposes to take with respect thereto:

 

(i)
promptly upon receipt by Seller of notice or Knowledge of the occurrence of any Potential Event of Default or Event of Default, but in no event later than the immediately succeeding Business Day after the earlier of obtaining notice or Knowledge of any such occurrence;

 

(ii)
with respect to any Purchased Asset, promptly following receipt of any unscheduled Principal Payment (in full or in part);

 

(iii)
promptly upon the occurrence of any of the following: (A) with respect to any Purchased Asset or related Underlying Mortgaged Property, material loss or damage, regulatory issues, material licensing or permit issues, violation of any Requirement of Law, violation of any Environmental Law or any other actual or expected event or change in circumstances that could reasonably be expected to result in a default or material decline in market value or cash flow, and

(B) with respect to Seller, Pledgor and Guarantor, a violation of any Requirement of Law or other event or circumstance that could reasonably be expected to have a Material Adverse Effect;

 

(iv)
promptly upon the establishment of a rating by any nationally recognized rating agency applicable to Guarantor and any downgrade in or withdrawal of such rating once established;

 

(v)
promptly upon the occurrence of any event or circumstance that could reasonably be determined to cause Guarantor to breach any of the covenants contained in Section 9 of the Guarantee Agreement;

 

(vi)
promptly, and in any event within ten (10) days after service of process on any of the following, give Administrative Agent notice of all litigation, action, suit, arbitration, investigation or other legal or arbitration proceedings (including, without limitation, any of the following which are pending or threatened) or other legal or arbitrable proceedings affecting Seller, Pledgor, Guarantor, any Purchased Asset (or obligor thereunder) or affecting any of the assets of Seller before any Governmental Authority that (A) questions or challenges the validity or enforceability of any Transaction, Purchased Asset or Purchased Asset Document, (B) makes a claim or claims in an aggregate amount greater than (1) $250,000 with respect to Seller and (2)

$10,000,000 with respect to Guarantor, (C) individually or in the aggregate, if adversely determined, could reasonably be likely to have a Material Adverse Effect, (D) requires filing with

 

 

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the SEC in accordance with the 1934 Act and any rules thereunder or (E) raises any lender licensee issues with respect to any Purchased Asset;

 

(vii)
promptly, and in any event within one (1) Business Day of receipt of notice by Seller or Knowledge, of (A) any event that would result in any Purchased Asset becoming subject to a Mandatory Early Repurchase Event, (B) any lien or security interest (other than security interests created hereby) on, or claim asserted against, any Purchased Asset or, to Seller’s Knowledge, the underlying collateral therefor, (C) any event or change in circumstances that has or could reasonably be expected to have an adverse effect on the market value of a Purchased Asset or (D) the resignation or termination of any servicer under any Servicing Agreement with respect to any Purchased Asset; and

 

(viii)
promptly upon receipt by Seller of notice or Knowledge of the occurrence of any breach of any representation contained in Article 9(b)(x), but in no event later than the immediately succeeding Business Day after the earlier of obtaining notice or Knowledge of any such occurrence;

 

(ix)
promptly upon any transfer of any Underlying Mortgaged Property or any direct or indirect equity interest in any Mortgagor to the extent the related Mortgagor is required to provide notice thereof to Seller under the related Purchased Asset Documents.

 

(y)
Seller shall comply with the USA Patriot Act and all applicable requirements of Governmental Authorities having jurisdiction over Seller and the Purchased Items, including those relating to money laundering and terrorism. Seller agrees that Administrative Agent, on behalf of Buyers, shall have the right to audit Seller’s compliance with the USA Patriot Act and all applicable requirements of Governmental Authorities having jurisdiction over Seller and the Purchased Items, including those relating to money laundering and terrorism. Seller agrees that, in the event Seller fails to comply with the USA Patriot Act or any such applicable requirements of Governmental Authorities, then Administrative Agent may, at its option, cause Seller to comply therewith, and any and all reasonable costs and expenses incurred by Administrative Agent, on behalf of Buyers, in connection therewith shall be immediately due and payable by Seller.

 

(z)
Seller shall provide Administrative Agent with written notice of any amendment, modification or waiver with respect to a Purchased Asset (including such amendments, modifications or waivers that do not constitute a Significant Modification).

 

ARTICLE 12.

SINGLE PURPOSE ENTITY

 

Seller hereby represents and warrants to Administrative Agent and Buyers and covenants with Administrative Agent and Buyers that, on and as of the date of this Agreement and each Purchase Date and at all times while this Agreement and any Transaction hereunder is in effect or any Repurchase Obligations remain outstanding:

 

(a)
it is and intends to remain solvent, and it has paid and will pay its debts and liabilities (including overhead expenses) from its own assets as the same shall become due;

 

(b)
it has complied and will comply with the provisions of its certificate of formation and its limited liability company agreement;

 

 

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