CREDIT AGREEMENT

ARTICLE I GENERAL TERMS 

ARTICLE II AMOUNT AND TERMS OF LOANS 

ARTICLE III CONDITIONS PRECEDEN

ARTICLE IV BORROWER REPRESENTATIONS AND WARRANTIES 

ARTICLE V AFFIRMATIVE COVENANTS 

ARTICLE VI NEGATIVE COVENANTS 

ARTICLE VII EVENTS OF DEFAULT 

ARTICLE VIII INDEMNIFICATION 

ARTICLE IX THE ADMINISTRATIVE AGENT 

ARTICLE X TAXES AND YIELD PROTECTION 

ARTICLE XI MISCELLANEOUS

SCHEDULES

Schedule 1.1                                Commitments and Commitment Percentages

Schedule 1.2                                Approved Investors

Schedule 4.14                              Subsidiaries

Schedule 6.2                                Related Person Indebtedness

EXHIBITS

Exhibit A                      Form of Note

Exhibit B                      Form of Borrowing Request

Exhibit C                      Certificate Accompanying Financial Statement

Exhibit D                      Borrowing Base Certificate

Exhibit E                      Form of Security Agreement

THIS CREDIT AGREEMENT is made and entered into as of April 29, 2009 (the “ Effective Date ”), among M/I FINANCIAL CORP., an Ohio corporation (the “ Borrower ”), each lender from time to time party hereto (collectively, the “ Lenders ” and individually, a “ Lender ”), and THE HUNTINGTON NATIONAL BANK, as Administrative Agent.

The Borrower has requested that the Lenders provide a credit facility, and the Lenders are willing to do so on the terms and conditions set forth herein.

In consideration of the mutual covenants and agreements herein contained, the parties hereto covenant and agree as follows:

Section 1.1                       Certain Definitions

.  As used in this Agreement, the following terms have the following meanings:

“ Act ” has the meaning specified in Section 11.19 .

“ Adjusted Floating LIBOR ” means, for any day, the rate per annum equal to the sum of (i) the greater of (A) the Floating LIBOR for such day or (B) one and one-quarter percent (1.25%) plus (ii) the Applicable Floating LIBOR Margin, provided that Adjusted Floating LIBOR shall never exceed the Maximum Rate.

“ Adjusted Tangible Net Worth ” means, as of any date, the Tangible Net Worth of the Borrower minus the sum of (i) the outstanding amount of Intercompany Loans and (ii) Investments of the Borrower in Subsidiaries that are not Guarantors.

“ Administrative Agent ” shall have the meaning assigned to such term in the preamble hereof.

“ Affiliate ” means, as to any Person, each other Person that directly or indirectly (through one or more intermediaries or otherwise) controls, is controlled by, or is under common control with, such Person.

“ Aged Loan ” means an Eligible Mortgage Loan which has been included in the Borrowing Base for more than thirty (30) days but less than or equal to ninety (90) days.

“ Aggregate Commitments ” means the Commitments of all Lenders, which amount shall not exceed (a) from and including the Effective Date through and including December 19, 2009, $20,000,000, (b) from and including December 20 of each calendar year this Agreement is in full force and effect through and including January 19 of the immediately succeeding calendar year,  $30,000,000, and (c) from and including January 20 of each calendar year this Agreement is in full force and effect, through and including December 19 of such calendar year, $20,000,000.

“ Agreement ” means this Credit Agreement, as the same may from time to time be amended, supplemented, or restated.

“ Agreement to Pledge ” means each agreement by the Borrower set forth in a Borrowing Request for Wet Loans, to deliver Required Mortgage Documents to the Administrative Agent.

“ Applicable Advance Rate Percentage ”   means, for each Mortgage Loan classification listed below, the percentage listed opposite such Mortgage Loan classification:

“ Applicable Floating LIBOR Margin ” means four percent (4.00%) per annum.

“ Applicable Sublimit ” means, for each Mortgage Loan classification listed below, the percentage of the Aggregate Commitments listed opposite such Mortgage Loan classification:

provided , however , that in the last five (5) and first five (5) Business Days of every calendar month the Applicable Sublimit for Wet Loans shall be fifty percent (50%) of the Aggregate Commitments.

“ Appraised Value ” means, for any Mortgage Loan, the current appraised value of the real property secured by the Mortgage as determined by an appraisal performed in full compliance with FNMA/FHLMC appraisal requirements and on an appraisal form approved by FNMA or FHLMC, and performed by a state licensed or state-certified real estate appraiser (in accordance with the provisions of Title XI of FIRREA).

“ Assignee ” has the meaning specified in Section 11.10 .

“ Borrower ” shall have the meaning assigned to such term in the preamble hereof.

“ Borrowing ” means a borrowing of a new Loan.

“ Borrowing Base ” means, at any date, all Eligible Mortgage Loans that have been delivered to and held by the Administrative Agent or otherwise identified as Mortgage Collateral with an undertaking to so deliver.

“ Borrowing Base Certificate ” means a certificate describing the Eligible Mortgage Loans to be included in the Borrowing Base in the form of Exhibit D or other form acceptable to the Administrative Agent.

“ Borrowing Request ” means a request, in the form of Exhibit B , for a Loan pursuant to Article II .

“ Business Day ” means a day, other than a Saturday or Sunday, on which commercial banks are open for business to the public in Columbus, Ohio.  Any Business Day in any way relating to Floating LIBOR must also be a day on which, in the judgment of the Administrative Agent, significant transactions in dollars are carried out in the interbank Eurocurrency market.

“ Cash Equivalents ” means (a) securities issued or directly and fully guaranteed or insured by the United States government, or any agency or instrumentality thereof, which mature within ninety (90) days from the date of acquisition, and (b) time deposits and certificates of deposit, which mature within ninety (90) days from the date of acquisition, of Lender or any other domestic commercial bank having capital and surplus in excess of $200,000,000, which has, or the holding company of which has, a commercial paper rating of at least A-1 or the equivalent thereof by Standard & Poors (a division of the McGraw-Hill Companies) or P-1 or the equivalent thereof by Moody’s Investors Service, Inc.

“ Change in Law ” means the occurrence, after the date of this Agreement, of any of the following: (a) the adoption or taking effect of any law, rule, regulation, or treaty, (b) any change in any law, rule, regulation, or treaty or in the administration, interpretation, or application thereof by any Governmental Authority, or (c) the making or issuance of any guideline or directive (whether or not having the force of law) by any Governmental Authority.

“ Change of Control ” means (i) the Parent ceases to own one hundred percent (100%) of the voting power of the voting stock of the Borrower, or (ii) the occurrence of any of the following: (a) any Person or group (as that term is understood under Section 13(d) of the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”) and the rules and regulations thereunder) shall have acquired beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act) of a percentage (based on voting power, in the event different classes of stock shall have different voting powers) of the voting stock of the Parent equal to at least fifty percent (50%); or (b) as of any date a majority of the board of Directors of the Parent consists of individuals who were not either (i) directors of the Parent as of the corresponding date of the previous year, (ii) selected or nominated to become directors by the Board of Directors of the Parent of which a majority consisted of individuals described in clause (b)(i) above or (iii) selected or nominated to become directors by the Board of Directors of the Parent of which a majority consisted of individuals described in clause (b)(i) above and individuals described in clause (b)(ii) above.

“ CLTV ” means, as to any Mortgage Loan, the ratio expressed as a percentage determined by dividing (i) the total amount owing and outstanding on all loans secured by the residential real property and improvements serving as collateral for the Mortgage Loan, by (ii) the Appraised Value of the residential real property and improvements serving as collateral for the Mortgage Loan.

“ Code ” means the Internal Revenue Code of 1986, as amended.

“ Collateral ” has the meaning given to it in the Security Agreement.

“ Collateral Value of the Borrowing Base ” means, on any day, the sum of the Unit Collateral Values of all Eligible Mortgage Loans included in the Borrowing Base on such day as determined by the Administrative Agent based on information then available to the Administrative Agent.

“ Commitment ” means, as to each Lender, the obligation of such Lender to make Loans to the Borrower pursuant to Section 2.1 hereof, in an aggregate principal amount at any one time outstanding not to exceed the amount opposite such Lender’s name on Schedule 1.1 hereto, as such amount may be adjusted from time to time in accordance with this Agreement.

“ Commitment Percentage ” means, for each Lender as of any date, the percentage of the Aggregate Commitments represented by such Lender’s Commitment, as it may be amended from time to time, which initially shall be set forth on Schedule 1.1 .

“ Conforming Loan ” means a Mortgage Loan which (a) receives one of the following responses from Fannie Mae Desktop Underwriter: (i) Approve/Eligible, (ii) Approve/Ineligible, (iii) Refer/Eligible, or (iv) EA-I,-II,-III/Eligible, or (b) receives one of the following responses from Freddie Mac Loan Prospector: (i) Accept/Accept, or (ii) A-Minus.  Mortgage Loans receiving a “Refer/Eligible” response must be accompanied by the Investor’s approval to the exception.  Mortgage Loans receiving approval under the “Expanded Approval” (“ EA ”) criteria or “A-Minus” criteria are permitted only if the Borrower provides the Administrative Agent with a copy of the Fannie Mae or Freddie Mac contract that allows delivery by the Borrower for this loan type.  Mortgage Loans receiving an “Approve/Ineligible” response are permitted only if the Borrower represents and warrants to the Administrative Agent that the Borrower possesses an agency waiver with respect to such Mortgage Loan, thereby making such Mortgage Loan agency eligible.

“ Consolidated ” refers to the consolidation of any Person, in accordance with GAAP, with its properly consolidated subsidiaries.  References herein to a Person’s Consolidated financial statements, financial position, financial condition, liabilities, etc. refer to the consolidated financial statements, financial position, financial condition, liabilities, etc. of such Person and its properly consolidated subsidiaries.

“ Control Agreement ” means each control agreement, in form and substance satisfactory to the Administrative Agent, executed and delivered by the Borrower, the Administrative Agent, and the applicable depositary bank.

“ Debtor Laws ” means all applicable liquidation, conservatorship, bankruptcy, moratorium, arrangement, receivership, insolvency, reorganization, or similar Laws, from time to time in effect, affecting the rights of creditors generally and general principles of equity.

“ Default ” means any of the events specified in Section 7.1 hereof, whether or not any requirement for notice or lapse of time or any other condition has been satisfied.

“ Default Rate ” means, at the time in question, with respect to all Obligations, the sum of (i) six percent (6%) per annum, plus (ii) the per annum interest rate otherwise payable in respect of the Obligations; provided that , in no event shall the Default Rate ever exceed the Maximum Rate.

“ Dividends ,” in respect of any corporation, means: (a) cash distributions or any other distributions on, or in respect of, any class of equity security of such corporation, except for distributions made solely in shares of securities of the same class; and (b) any and all funds, cash, or other payments made in respect of the redemption, repurchase, or acquisition of such securities.

“ Drawdown Termination Date ” means the earlier of May 15, 2010, or such earlier day on which the Note first becomes due and payable in full.

“ Dry Loan ” means an Eligible Mortgage Loan included in the Borrowing Base and for which the Required Mortgage Documents have been delivered to the Administrative Agent.

“ EBIT ” means, for any period, on a consolidated basis for the Borrower and its Subsidiaries, the sum of the amounts for such period, without duplication, calculated in each case in accordance with GAAP, of (i) Net Income, plus (ii) accrued Interest Expense to the extent deducted in computing Net Income, plus (iii) charges against income for foreign, federal, state, and local taxes to the extent deducted in computing Net Income.

“ Effective Date ” shall have the meaning assigned to such term in the preamble hereof.

“ Eligible Mortgage Loan ” means a Mortgage Loan with respect to which each of the following statements is accurate and complete (and the Borrower by including such Mortgage Loan in any computation of the Collateral Value of the Borrowing Base shall be deemed to so represent and warrant to the Administrative Agent and the Lenders at and as of the date of such computation):

(a)           Such Mortgage Loan is a binding and valid obligation of the Obligor thereon, in full force and effect and enforceable in accordance with its terms, except as enforceability may be limited by Debtor Laws;

(b)           The Mortgage Note evidencing such Mortgage Loan is genuine in all respects as appearing on its face and as represented in the books and records of the Borrower, and all information set forth therein is true and correct;

(c)           Such Mortgage Loan is free of any default (other than as permitted by subparagraph (d) below) of any party thereto (including the Borrower), counterclaims,

offsets, and defenses, including the defense of usury, and from any rescission, cancellation, or avoidance, and all right thereof, whether by operation of law or otherwise;

(d)           No payment under such Mortgage Loan is more than thirty (30) days past due of the payment due date set forth in the underlying Mortgage Note and Mortgage;

(e)           The Mortgage Note evidencing such Mortgage Loan contains the entire agreement of the parties thereto with respect to the subject matter thereof, has not been modified or amended in any respect not expressed in writing therein, and is free of concessions or understandings with the Obligor thereon of any kind not expressed in writing therein;

(f)           Such Mortgage Loan is in all respects in accordance with all Requirements of Law applicable thereto, including, without limitation, the federal Consumer Credit Protection Act and the regulations promulgated thereunder and all applicable usury Laws and restrictions, and all notices, disclosures, and other statements or information required by Law or regulation to be given, and any other act required by Law or regulation to be performed, in connection with such Mortgage Loan have been given and performed as required;

(g)           All advance payments and other deposits on such Mortgage Loan have been paid in cash, and no part of said sums has been loaned, directly or indirectly, by the Borrower to the Obligor, and, other than as disclosed to Lender in writing, there have been no prepayments;

(h)           Such Mortgage Loan will be free and clear of all Liens, except Permitted Liens;

(i)           The Property covered by such Mortgage Loan is insured against loss or damage by fire and all other hazards normally included within standard extended coverage in accordance with the provisions of such Mortgage Loan with the Borrower named as a loss payee thereon;

(j)           Such Mortgage Loan is secured by a first Mortgage, or in the case of any Second Lien/HELOC Loan, a second Mortgage, on Single Family property;

(k)           The date of origination of such Mortgage Loan is not more than thirty (30) days prior to the date such Mortgage Loan was first included in the Borrowing Base;

(l)           Such Mortgage Loan has not been included in the Borrowing Base for more than ninety (90) days;

(m)           If such Mortgage Loan is included in the Borrowing Base and has been withdrawn from the possession of the Administrative Agent on terms and subject to conditions set forth in the Security Agreement:

(i)           If such Mortgage Loan was withdrawn by the Borrower for purposes of correcting clerical or other non-substantive documentation problems, the promissory note and other documents relating to such Mortgage Loan are returned to the Administrative Agent within ten (10) Business Days from the date of withdrawal; and the Unit Collateral Value of such Mortgage Loan when added to the Unit Collateral Value of other Mortgage Loans that have been similarly released to the Borrower and have not been returned does not exceed ten percent (10%) of the Aggregate Commitments;

(ii)           If such Mortgage Loan was shipped by the Administrative Agent directly to a permanent Investor for purchase or to a custodian for the formation of a pool, (x) such Investor or custodian is in full compliance with the terms of the bailee letter under which such Mortgage Loan was shipped, and (y) the full purchase price for such Mortgage Loan has been received by the Administrative Agent (or such Mortgage Loan has been returned to the Administrative Agent) within forty-five (45) calendar days from the date of shipment by the Administrative Agent;

(n)           Such Mortgage Loan is subject to (i) a Take-Out Commitment which is in full force and effect or (ii) a Hedging Arrangement;

(o)           Such Mortgage Loan conforms to and satisfies the requirements for one of the following Mortgage Loan classifications and has been designated by the Borrower as one (1) and only one (1) of the following: (i) Prime Loan, (ii) Jumbo Loan, or (iii) Second Lien/HELOC Loan; provided that , within each Mortgage Loan classification listed above, the Unit Collateral Value of such Mortgage Loan when added to the Unit Collateral Value of all other Mortgage Loans in the same Mortgage Loan classification does not exceed the Applicable Sublimit for such Mortgage Loan classification;

(p)           The Required Mortgage Documents have been delivered to the Administrative Agent prior to the inclusion of such Mortgage Loan in any computation of the Borrowing Base or, if such items have not been delivered to the Administrative Agent on or prior to the date such Mortgage Loan is first included in any computation of the Borrowing Base, (a) the Borrower has pledged and agreed to deliver all Required Mortgage Documents pursuant to a Borrowing Request delivered to the Administrative Agent prior to such inclusion, and (b) the Unit Collateral Value of such Mortgage Loan when added to the Unit Collateral Value of all other Mortgage Loans for which the Administrative Agent has not received the Required Mortgage Documents does not exceed the Applicable Sublimit for Wet Loans, provided that , all Required Mortgage Documents with respect to such Mortgage Loan shall be delivered to the Administrative Agent within three (3) Business Days after the date of the Agreement to Pledge with respect thereto;

(q)           The Property covered by such Mortgage Loan is located within the fifty United States;

(r)           Such Mortgage Loan has been underwritten by the originator thereof in accordance with such originator’s then current underwriting guidelines; and

(s)           The representations and warranties made by the Borrower in Section 4.23 with respect to each Mortgage Note and Mortgage Loan are true and correct.

“ Environmental Laws ” means any and all Laws relating to (a) the protection of the environment, (b) emissions, discharges, or releases of pollutants, contaminants, chemicals, or hazardous or toxic substances or wastes into the environment including ambient air, surface water, ground water, or land, or (c) the manufacture, processing, distribution, use, treatment, storage, disposal, transport, or handling of pollutants, contaminants, chemicals, or industrial, toxic, or hazardous substances or wastes or the clean-up or other remediation thereof.

“ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended from time to time, together with the regulations from time to time promulgated with respect thereto.

“ ERISA Affiliate ” means all members of the group of corporations and trades or businesses (whether or not incorporated) which, together with the Borrower, are treated as a single employer under Section 414 of the Code.

“ ERISA Plan ” means any pension benefit plan subject to Title IV of ERISA or Section 412 of the Code maintained or contributed to by the Borrower or any ERISA Affiliate with respect to which the Borrower has a fixed or contingent liability.

“ E-Sign Act ” means the Electronic Signatures in Global and National Commerce Act, as amended from time to time.

“ Event of Default ” means any of the events specified in Section 7.1 hereof, provided that , any requirement in connection with such event for the giving of notice or the lapse of time, or the happening of any further condition, event, or act has been satisfied.

“ Excluded Taxes ” means, with respect to the Administrative Agent, any Lender, or any other recipient of any payment to be made by or on account of any obligation of the Borrower hereunder, (a) taxes imposed on or measured by its overall net income (however denominated), and franchise taxes imposed on it (in lieu of net income taxes), by the jurisdiction (or any political subdivision thereof) under the Laws of which such recipient is organized or in which its principal office is located or, in the case of any Lender, in which its applicable lending office is located, (b) any branch profits taxes imposed by the United States or any similar tax imposed by any other jurisdiction in which the Borrower is located, and (c) in the case of a Foreign Lender (other than an assignee pursuant to a request by the Borrower under Section 10.3(b) ), any withholding tax that is imposed on amounts payable to such Foreign Lender at the time such Foreign Lender becomes a party hereto (or designates a new lending office) or is attributable to such Foreign Lender’s failure or inability (other than as a result of a Change in Law) to comply with Section 10.1(e) , except to the extent that such Foreign Lender (or its assignor, if any) was entitled, at the time of designation of a new lending office (or assignment), to receive additional amounts from the Borrower with respect to such withholding tax pursuant to Section 10.1(a) .

“ Federal Funds Rate ” means, for any day, the 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 by the Federal

Reserve Bank on the Business Day next succeeding such day; provided that , (a) if such day is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (b) if no such rate is so published on such next succeeding Business Day, the Federal Funds Rate for such day shall be the average rate (rounded upward, if necessary, to a whole multiple of 1/100 of 1%) charged to The Huntington National Bank on such day on such transactions as determined by the Administrative Agent.

“ Fee Letter ” means that certain letter agreement, dated as of the Effective Date, between the Borrower and the Administrative Agent.

“ FHA ” means the Federal Housing Administration or any successor thereto.

“ FHA Loan ” means a Mortgage Loan insured by the FHA.

“ FHLMC ” or “ Freddie Mac ” means the Federal Home Loan Mortgage Corporation, or any successor thereto.

“ Financing Lease ” means (i) any lease of Property if the then present value of the minimum rental commitment thereunder should, in accordance with GAAP, be capitalized on a balance sheet of the lessee, and (ii) any other lease obligations that are capitalized on a balance sheet of the lessee.

“ FIRREA ” means the Financial Institutions Reform Recovery and Enforcement Act of 1989, as amended from time to time, together with the regulations from time to time promulgated with respect thereto.

“ Fiscal Quarter ” means each period of three (3) calendar months ending March 31, June 30, September 30, and December 31 of each year.

“ Fiscal Year ” means each period of twelve (12) calendar months ending December 31 of each year.

“ Floating LIBOR ” means, for any day with respect to any Loan, the rate per annum (rounded upwards, if necessary, to the nearest 1/100 of 1%) equal to the rate obtained by dividing (i) the actual or estimated per annum rate, or the arithmetic mean of the per annum rates, of interest for deposits in U.S. dollars for one (1) month, as determined by the Administrative Agent in its good faith discretion based upon information which appears on page LIBOR01, captioned British Bankers Assoc. Interest Settlement Rates, of the Reuters America Network, a service of Reuters America Inc. (or such other page that may replace that page on that service for the purpose of displaying London interbank offered rates, or if such service ceases to be available or ceases to be used by the Administrative Agent, such other reasonably comparable money rate service as the Administrative Agent may select) or upon information obtained from any other reasonable procedure, as of two (2) Business Days prior to the commencement of such interest period applicable to such Loan; by (ii) an amount equal to one minus the stated maximum rate (expressed as a decimal), if any, of all reserve requirements (including, without limitation, any marginal, emergency, supplemental, special or other reserves) that is specified on each date LIBOR is determined by the Board of Governors of the Federal

Reserve System (or any successor agency thereto) for determining the maximum reserve requirement with respect to eurocurrency funding (currently referred to as “Eurocurrency liabilities” in Regulation D of such Board) maintained by a member bank of such system, or any other regulations of any Governmental Authority having jurisdiction with respect thereto, all as conclusively determined by the Administrative Agent.  Subject to any maximum or minimum interest rate limitation specified herein or by applicable law, LIBOR shall change automatically without notice to any Related Party immediately on the first day of each Interest Period, with any change thereto effective as of the opening of business on the day of any change.

“ FNMA ” or “ Fannie Mae ” means the Federal National Mortgage Association, or any successor thereto.

“ Foreign Lender ” means any Lender that is organized under the Laws of a jurisdiction other than that in which the Borrower is resident for tax purposes.  For purposes of this definition, the United States, each State thereof and the District of Columbia shall be deemed to constitute a single jurisdiction.

“ Full Documentation Mortgage Loan ” means a Mortgage Loan supported by all of the customary documentation required to underwrite the Mortgage Loan, including, without limitation, the following: (i) Verification of Income (“ VOI ”), (ii) Verification of Assets (“ VOA ”), and (iii) Verification of Employment (“ VOE ”).

“ Funding Account ” means the non-interest bearing demand checking account established by the Borrower with The Huntington National Bank and subject to a Control Agreement in favor of the Administrative Agent to be used for (a) the initial deposit of proceeds of Loans; and (b) the funding or purchase of a Mortgage Note by the Borrower; provided that , the Borrower shall not be entitled to withdraw funds from the Funding Account.

“ GAAP ” means those generally accepted accounting principles and practices that are recognized as such by the Financial Accounting Standards Board (or any generally recognized successor) and which, in the case of the Borrower and its consolidated subsidiaries, are applied for all periods after the Effective Date in a manner consistent with the manner in which such principles and practices were applied to the financial statements described in Section 4.7 .  If any change in any accounting principle or practice is required by the Financial Accounting Standards Board (or any such successor) in order for such principle or practice to continue as a generally accepted accounting principle or practice, all reports and financial statements required hereunder with respect to the Borrower or the Parent may be prepared in accordance with such change, but all calculations and determinations to be made hereunder may be made in accordance with such change only after notice of such change is given to the Administrative Agent and the Administrative Agent agrees to such change insofar as it affects the accounting of the Borrower.

“ Governmental Authority ” means any nation or government, any agency, department, state, or other political subdivision thereof and any entity exercising executive, legislative, judicial, regulatory, or administrative functions of or pertaining to government.

“ Governmental Requirement ” means any law, statute, code, ordinance, order, rule, regulation, judgment, decree, injunction, franchise, permit, certificate, license, authorization, or

other direction or requirement (including, without limitation, any of the foregoing that relate to environmental standards or controls, energy regulations, and occupational, safety, and health standards or controls) of any arbitrator, court, or other Governmental Authority, which exercises jurisdiction over any Related Person or any of its Property.

“ Guarantor ” means the Parent and any other Person which becomes obligated to the Administrative Agent or the Lenders in respect of the Loans or other Obligations under any Loan Document; provided, however, the guaranty agreement evidencing the Guaranty Obligation of the Parent shall be limited to $15,000,000 pursuant to the terms of such guaranty agreement.

“ Guaranty Obligation ” of any Person means any contract, agreement, or understanding of such Person pursuant to which such Person guarantees, or in effect guarantees, any Indebtedness, lease, dividends, or other obligations (the “ Primary Obligations ”) of any other Person (the “ Primary Obligor ”) in any manner, whether directly or indirectly, contingently or absolutely, in whole or in part, including without limitation agreements:

(a)           to purchase such Primary Obligation or any property constituting direct or indirect security therefor,

(b)           to advance or supply funds (A) for the purchase or payment of any such Primary Obligation, or (B) to maintain working capital or other balance sheet conditions of the Primary Obligor or otherwise to maintain the net worth or solvency of the Primary Obligor,

(c)           to purchase property, securities, or services primarily for the purpose of assuring the owner of any such Primary Obligation of the ability of the Primary Obligor to make payment of such Primary Obligation; or

(d)           otherwise to assure or hold harmless the owner of any such Primary Obligation against loss in respect thereof;

provided , that “ Guaranty Obligation ” shall not include endorsements that are made in the ordinary course of business of negotiable instruments or documents for deposit or collection.  The amount of any Guaranty Obligation shall be deemed to be the maximum amount for which the guarantor may be liable pursuant to the agreement that governs such Guaranty Obligation, unless such maximum amount is not stated or determinable, in which case the amount of such obligation shall be the maximum reasonably anticipated liability thereon, as determined by such guarantor in good faith.

“ Hedging Arrangement ” means any forward sales contract, forward trade contract, interest rate swap agreement, interest rate cap agreement, or other contract pursuant to which Borrower has protected itself from the consequences of a loss in the value of a Mortgage Loan because of changes in interest rates or in the market value of mortgage loan assets.

“ HELOC ” means home equity line of credit.

“ Indebtedness ” of any Person at a particular date means the sum (without duplication) at such date of (a) all indebtedness of such Person for borrowed money or for the deferred purchase

price of property or services or which is evidenced by a note, bond, debenture, or similar instrument, (b) all obligations of such Person under any Financing Lease, (c) all obligations of such Person in respect of letters of credit, acceptances, or similar obligations issued or created for the account of such Person, (d) all Guaranty Obligations of such Person, (e) all liabilities secured by any Lien on any property owned by such Person, whether or not such Person has assumed or otherwise become liable for the payment thereof, (f) any liability of such Person in respect of unfunded vested benefits under an ERISA Plan, (g) all liabilities of such Person in respect of indemnities or repurchase obligations made in connection with the sale of Mortgage Loans, and (h) any liability of such Person in respect of any Hedging Arrangement.

“ Indemnified Party ” has the meaning set forth in Section 8.1 hereof.

“ Indemnified Taxes ” means Taxes other than Excluded Taxes.

“ Intercompany Loan ” means a loan or advance from a Related Person to an Affiliate or shareholder, member, or partner of any Related Person.

“ Interest Expense ” means, for any period, the total interest expense of the Borrower and its Subsidiaries, whether paid or accrued (including the interest component of any Financing Leases, commitment and letter of credit fees), all as determined in conformity with GAAP.

“ Investor ” means any Person approved by the Administrative Agent and listed on Schedule 1.2 , as such Schedule may be updated or supplemented from time to time; provided, however , that the Administrative Agent shall deliver a list of all Persons approved as Investors by the Administrative Agent upon each amendment of such Schedule by the Administrative Agent, and an Investor shall be removed from such list upon the written direction of the Administrative Agent.

“ Investment Property ” means a Single Family dwelling that is not the Principal Residence or Second/Vacation Property of the Obligor under the related Mortgage Loan.

“ Jumbo Loan ” means a Single Family Mortgage Loan that (a) is secured by a first-lien Mortgage Loan, (b) has an original principal balance of greater than the current FNMA/FHLMC loan size limit but less than or equal to $750,000, (c) has a FICO score greater than or equal to 680, (d) has a LTV less than or equal to 80% (or 95% if subject to mortgage insurance acceptable to the Administrative Agent), (e) has a CLTV less than or equal to 90% (or 100% if subject to mortgage insurance acceptable to the Administrative Agent), and (f) other than its loan size, would qualify as a Conforming Loan.

“ Law ” means any statute, law, regulation, ordinance, rule, treaty, judgment, order, decree, permit, concession, franchise, license, agreement or other governmental restriction of the United States or any state or political subdivision thereof.  Any reference to a Law includes any amendment or modification to such Law, and all regulations, rulings, and other Laws promulgated under such Law.

“ Lender ” and “ Lenders ” have the meaning assigned to such terms in the preamble hereof.

“ Liabilities ” means, as to any Person as of any date, the total of all amounts which would be properly classified as “liabilities” in a balance sheet of such Person at such date, prepared in accordance with GAAP, consistently applied, including without limitation, deferred income taxes, deferred compensation of any type and capital lease obligations, if any.

“ Lien ” means any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (whether statutory or otherwise), or 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, 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).

“ Loan ” has the meaning given it in Section 2.1 .

“ Loan Balance ” means for any day, the principal balance of the Loans outstanding on such day.

“ Loan Document ” means any, and “ Loan Documents ” means all, of this Agreement, the Notes, any guaranty agreement or other agreement evidencing a Guaranty Obligation in respect of the Loans, the Security Instruments, the Fee Letter, any intercreditor agreement in respect of the Collateral and any and all other agreements, certificates or instruments now or hereafter executed and delivered by the Borrower or any other Person in connection with, or as security for the payment or performance of any or all of the Obligations, as any of such may be renewed, amended or supplemented from time to time.

“ Loan to Value ” or “ LTV ” means, as to any Mortgage Loan, the ratio expressed as a percentage determined by dividing (a) the total principal amount owing and outstanding on the first-lien Mortgage Loan, by (b) the Appraised Value of the residential real property and improvements serving as collateral for the Mortgage Loan.

“ Market Value ” on any day shall be determined by the Administrative Agent, in its sole discretion, based upon (a) information then available to the Administrative Agent regarding quotes from dealers for the purchase of mortgage notes similar to the Mortgage Note that have been delivered to the Administrative Agent pursuant to this Agreement or (b) sales prices actually received by the Borrower for mortgage notes sold by the Borrower during the immediately preceding thirty (30) day period similar to the Mortgage Note that have been delivered to the Administrative Agent pursuant to this Agreement.

“ Material Adverse Effect ” means any material adverse effect on (a) the validity or enforceability of this Agreement, the Notes or any other Loan Document, (b) the business, operations, total Property, prospects or condition (financial or otherwise) of any Related Person or Guarantor, (c) the Collateral under any Security Instrument, or (d) the ability of any Related Person or Guarantor to fulfill its obligations under this Agreement, the Notes, or any other Loan Document to which it is a party.

“ Maximum Rate ” means, with respect to each Lender, the maximum nonusurious rate of interest that such Lender is permitted under applicable Law to contract for, take, charge, or receive with respect to its Loans.

“ MERS ” means Mortgage Electronic Registration Systems, Inc., a Delaware corporation, or any successor thereto.

“ MERS Agreement ” means those agreements by and among the Borrower, Lender, MERS and MERSCORP, Inc., as amended, modified, supplemented, extended, restated or replaced from time to time.

“ MERS Loans ” means any Mortgage Loan for which (a) the Borrower has designated or will designate MERS as, and has taken or will take such action as is necessary to cause MERS to be, the mortgagee of record, as nominee for the Borrower, in accordance with the MERS Procedures Manual and (b) the Borrower has designated or will designate the Administrative Agent as the interim funder on the MERS® System.

“ MERS® System ” means the system of recording transfers of mortgages electronically maintained by MERS.

“ MIN ” means, with respect to each Mortgage Loan, the Mortgage Identification Number for such Mortgage Loan registered with MERS on the MERS® System.

“ MOM Loan ” means, with respect to any Mortgage Loan, MERS acting as the mortgagee of such Mortgage Loan, solely as nominee for the originator or the Borrower, as the case may be, of such Mortgage Loan and its successors and assignees.

“ Mortgage ” means a mortgage or deed of trust, on standard forms in form and substance satisfactory to the Administrative Agent, securing a Mortgage Note and granting a perfected, first or second priority lien on residential real property consisting of land and a one-to-four-family dwelling thereon which is completed and ready for occupancy.

“ Mortgage Collateral ” means all Mortgage Notes and all servicing rights in respect to such Mortgage Notes (a) which are made payable to the order of the Borrower or have been endorsed (without restriction or limitation) payable to the order of the Borrower, (b) in which the Administrative Agent has been granted and continues to hold a perfected first priority security interest, (c) which are in form and substance acceptable to the Administrative Agent in its reasonable discretion, (d) which are secured by Mortgages, and (e) which conform in all respects with all the requirements for purchase of such Mortgage Note under the Take-Out Commitments and are valid and enforceable in accordance with their respective terms.

“ Mortgage Loan ” means a mortgage loan which is evidenced by a Mortgage Note and secured by a Mortgage, together with the rights and obligations of a holder thereof and payments thereon and proceeds therefrom.

“ Mortgage Note ” means the note or other evidence of indebtedness evidencing the indebtedness of an Obligor under a Mortgage Loan.

“ Net Income ” of any Person means, for any period, the net income of such Person (excluding extraordinary gains but including extraordinary losses) for such period, calculated in accordance with GAAP.

“ Net Worth ” of any Person means, as of any date, an amount equal to all Consolidated assets of such Person minus such Person’s Consolidated liabilities, each as determined in accordance with GAAP.

“ Note ” means any promissory note delivered by the Borrower to any Lender pursuant to Section 2.2 in the form attached hereto as Exhibit A and all renewals, modifications, amendments, restatements, and extensions thereof.

“ Notice of Assignment ” has the meaning specified in Section 11.11(b)(ii) .

“ Obligations ” means all present and future Indebtedness, obligations (including indemnification obligations and expense reimbursement obligations), fees, debts, reasonable attorneys' fees and other costs incurred in the drafting, negotiation, enforcement or collection of any Loan Document, covenants, Guaranty Obligations, duties and liabilities of any kind and description owing by any Related Party or Guarantor to the Administrative Agent or any Lender arising pursuant to or in connection with this Agreement or any other Loan Document, irrespective of whether for the payment of money and regardless of whether any such Indebtedness, obligations, and liabilities are direct, indirect, fixed, contingent, joint, several or joint and several or hereafter arising, including without limitation any fees, interest or other amounts that would have accrued but for the commencement of any proceeding under any Debtor Law, and all renewals and extensions thereof, or any part thereof, all interest accrued thereon, and reasonable attorneys’ fees and other costs incurred in the drafting, negotiation, enforcement or collection thereof.

“ Obligor ” means the Person or Persons obligated to pay the Indebtedness which is the subject of a Mortgage Loan.

“ Operating Account ” means the non-interest bearing demand checking accounts (whether one or more) established by the Borrower with the Administrative Agent and subject to a Control Agreement to be used for the Borrower’s operations.  Subject to the rights of the Administrative Agent and the Lenders under Section 11.10 hereof, the Borrower shall be entitled to withdraw funds from the Operating Account.

“ Other Taxes ” means all present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies arising from any payment made hereunder or under any other Loan Document or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement or any other Loan Document.

“ Parent ” means M/I Homes, Inc., an Ohio corporation, and owner of all of the outstanding capital stock of the Borrower.

“ Parent Debt Agreement ” means that certain Second Amended and Restated Credit Agreement, dated as of October 6, 2006, among the Parent, JPMorgan Chase Bank, N.A., as agent, and the lenders party thereto, and all amendments, modifications and supplements thereto

and amendments and restatements thereof, and including any subsequent credit facilities refinancing any indebtedness thereunder.

“ PBGC ” means the Pension Benefit Guaranty Corporation or any Governmental Authority succeeding to any of its functions.

“ Permitted Liens ” means (i) Liens in favor of the Administrative Agent to secure the Obligations (ii) a first Lien in respect of a Second Lien/HELOC Loan in each instance in which the Borrower has become the owner of a Single Family Property through foreclosure or other similar procedure, and (iii) ad valorem taxes and assessments not yet due and payable.

“ Person ” means any individual, corporation, partnership, joint venture, association, joint stock company, limited liability company, trust, unincorporated organization, Governmental Authority, or any other form of entity.

“ Prime Loan ” means a Single Family Mortgage Loan that is (a) secured by a first-lien Mortgage and (b) a Conforming Loan, FHA Loan, or VA Loan.

“ Principal Residence ” means a Single Family dwelling that the Obligor occupies as his or her primary residence.

“ Property ” means any interest in any kind of property or asset, whether real, personal or mixed, or tangible or intangible.

“ Purchasers ” has the meaning specified in Section 11.11(b)(i) .

“ Regulation U ” means Regulation U issued by the Board of Governors of the Federal Reserve System as in effect from time to time.

“ Regulation T ” means Regulation T issued by the Board of Governors of the Federal Reserve System as in effect from time to time.

“ RegulationX ” means Regulation X issued by the Board of Governors of the Federal Reserve System as in effect from time to time.

“ Related Persons ” means the Borrower and each of the Borrower's Subsidiaries.

“ Reportable Event ” means (1) a reportable event described in Sections 4043(c)(5) or (6) of ERISA or the regulations promulgated thereunder, or (2) any other reportable event described in Section 4043(c) of ERISA or the regulations promulgated thereunder other than a reportable event not subject to the provision for 30-day notice to the PBGC pursuant to a waiver by the PBGC under Section 4043(a) of ERISA.

“ Required Lenders ” means, at any time, the holders of 50.1% or more of the Commitments, or if at any time the Commitments are terminated, the holders of 50.1% or more of the aggregate outstanding principal amount of all Loans; provided , however , that if only two Lenders hold the Commitments or 100% of the aggregate outstanding principal amount of all

Loans when the Commitments are terminated, then Required Lenders shall mean both such Lenders.

“ Required Mortgage Documents ” means, as to any Mortgage Loan, the items described on Schedule A to the Security Agreement.

“ Requirement of Law ” as to any Person means the charter and by-laws or other organizational or governing documents of such Person, and any law, statute, code, ordinance, order, rule, regulation, judgment, decree, injunction, franchise, permit, certificate, license, authorization or other determination, direction or requirement (including, without limitation, any of the foregoing which relate to environmental standards or controls, energy regulations and occupational, safety and health standards or controls) of any arbitrator, court, or other Governmental Authority, in each case applicable to or binding upon such Person or any of its Property or to which such Person or any of its Property is subject.

“ Restricted Payment ” shall mean (i) any dividend or other distribution, direct or indirect, on account of any shares of any class of capital stock or equity interest of any Related Party now or hereafter outstanding, (ii) any redemption, retirement, sinking fund or similar payment, purchase or other acquisition for value, direct or indirect, of any shares of any class of capital stock or equity interest of any Related Party now or hereafter outstanding, (iii) any payment made to redeem, purchase, repurchase or retire, or to obtain the surrender of, any outstanding warrants, options or other rights to acquire shares of any class of capital stock or equity interest of any Related Party now or hereafter outstanding, and (iv) any payment or prepayment of principal, premium, if any, or interest, fees or other charges on or with respect to, and any redemption, purchase, retirement, defeasance, sinking fund or similar payment and any claim to rescission with respect to, any Indebtedness subordinated to any Obligation.

“ Second Lien/HELOC Loan ” means a Single Family Mortgage Loan which (a) is secured by a traditional closed-end second-lien Mortgage or an open-end HELOC Mortgage, and in each case is a Conforming Loan, FHA Loan or VA Loan, (b) has a CLTV less than or equal to 95%, and (c) has a principal balance not greater than the current FNMA/FHLMC loan size limit for such Mortgages.

“ Second/Vacation Property ” means a Single Family dwelling that is not used for rental purposes and that the Obligor occupies for some portion of the year.

“ Security Agreement ” means the Security Agreement between the Borrower and the Administrative Agent, dated as of the Effective Date, in substantially the form attached as Exhibit E , as the same may from time to time be further supplemented, amended, or restated.

“ Security Instrument ” means (a) the Security Agreement and (b) such other executed documents, instruments, certificates, agreements and financing statements as are or may be necessary to grant to the Administrative Agent a perfected first prior and continuing security interest in and to all Mortgage Collateral, and any and all other agreements, certificates or instruments now or hereafter executed and delivered by the Borrower in connection with, or as security for the payment or performance of, all or any of the Obligations or the Secured Obligations (as defined in the Security Agreement), including the Borrower’s obligations under

the Notes and this Agreement, as such agreements may be amended, modified or supplemented from time to time.

“ Servicing Agreements ” means all agreements between the Related Persons and Persons other than a Related Person pursuant to which the Borrower undertakes to service Mortgage Loans.

“ Servicing Records ” means all contracts and other documents, books, records and other information (including without limitation, computer programs, tapes, discs, punch cards, data processing software and related property and rights) maintained with respect to the Servicing Rights.

“ Servicing Rights ” means all of right, title and interest of any Related Person (i) in and under the Servicing Agreements or (ii) to service any Mortgage Collateral, including, without limitation, in each instance the rights of the Borrower to income and reimbursement thereunder.

“ Settlement Account ” means the non-interest bearing demand deposit account established by the Borrower with the Administrative Agent, subject to a Control Agreement, to be used for (i) the deposit of proceeds from the sale of Mortgage Collateral, and (ii) the payment of the Obligations; provided that , (a) the Settlement Account shall be pledged to the Administrative Agent for the benefit of the Administrative Agent, and (b) the Borrower shall not be entitled to withdraw funds from the Settlement Account.

“ Single Family ” means residential real property consisting of land and a completed one-to-four unit single family dwelling thereon (including Principal Residences, Second/Vacation Property and Investment Property), which is fully completed and ready for occupancy, and which is not used for commercial purposes, is not a leasehold interest, and is not a manufactured or mobile home.

“ Subsidiary ” means, with respect to any Person, any corporation, association, partnership, joint venture, or other business or corporate entity, enterprise or organization which is directly or indirectly (through one or more intermediaries) controlled by or owned fifty percent (50%) or more by such Person.

“ Take-Out Commitment ” means with respect to any Eligible Mortgage Loan, a written master commitment of an Investor to purchase a pool of Mortgage Loans or an individual commitment of an Investor to purchase an individual Mortgage Loan under which such Eligible Mortgage Loan(s) will be delivered to such Investor on terms satisfactory to the Administrative Agent, in its reasonable discretion.

“ Tangible Net Worth ” means, as of any date, for any Person, the Net Worth of such Person minus all Consolidated assets of such Person which would be classified as intangible assets under GAAP, including but not limited to goodwill (whether representing the excess cost over book value of assets acquired or otherwise), patents, trademarks, trade names, copyrights, franchises, deferred charges, and capitalized servicing rights.

“ Taxes ” means all present or future taxes, levies, imposts, duties, deductions, withholdings, assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

“ Termination Event ” means (a) the occurrence with respect to any ERISA Plan of a Reportable Event, (b) the withdrawal of the Borrower or any ERISA Affiliate from an ERISA Plan during a plan year in which it was a "substantial employer," as defined in Section 4001(a)(2) of ERISA, (c) the distribution to affected parties of a notice of intent to terminate any ERISA Plan or the treatment of any ERISA Plan amendment as a termination under Section 4041 of ERISA, (d) the institution of proceedings to terminate any ERISA Plan by the PBGC under Section 4042 of ERISA, or (e) any other event or condition which might constitute grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any ERISA Plan.

“ Total Liabilities ” of any Person means, as of any date, the sum of (a) all Liabilities of such Person as of such date and (b) the aggregate amount of Mortgage Loans purchased and remaining under any Mortgage Loan purchase facility of such Person.

“ UCC ” means the Ohio Uniform Commercial Code, as the same may hereafter be amended.

“ UETA ” means the Ohio Uniform Electronic Transaction Act, as amended from time to time.

“ Unit Collateral Value ” means, on any day, with respect to each Eligible Mortgage Loan included in the Borrowing Base, the Applicable Advance Rate Percentage of the least of the following:

(i)           the outstanding principal balance of the Mortgage Note constituting such Mortgage Loan;

(ii)           the actual out-of-pocket cost to the Borrower of such Mortgage Loan minus the amount of principal paid under such Mortgage Loan and delivered to Lender for application to the prepayment of the Loans;

(iii)           the amount at which an Investor has committed to purchase the Mortgage Loan pursuant to a Take-Out Commitment; or

(iv)           the Market Value of the Mortgage Note constituting such Mortgage Loan;

provided that , if any such Eligible Mortgage Loan included in the Borrowing Base becomes an Aged Loan, the Unit Collateral Value of such Mortgage Loan as determined by the above calculation shall be reduced by twenty-five percent (25%), and the Borrower shall immediately, on such Eligible Mortgage Loan’s thirty-first (31st) day in the Borrowing Base, make repayment required by Section 2.5 ; and

provided further that , if any such Aged Loan is included in the Borrowing Base for more than sixty (60) days, the Unit Collateral Value of such Mortgage Loan shall be reduced by an

additional twenty-five percent (25%), and the Borrower shall immediately, on such Eligible Mortgage Loan’s sixty-first (61st) day in the Borrowing Base, make repayment required by Section 2.5 ; and

provided further that , no Eligible Mortgage Loan may be included in the Borrowing Base for more than ninety (90) days, such that on the ninety-first (91st) day after such Eligible Mortgage Loan is first included in the Borrowing Base, the Unit Collateral Value of such Mortgage Loan shall be reduced to zero, and the Borrower shall immediately make repayment required by Section 2.5 .

“ VA ” means the Veterans Administration and any successor thereto.

“ VA Loan ” means a Mortgage Loan guaranteed by the VA.

“ Wet Loan ” means an Eligible Mortgage Loan that is included in the Borrowing Base, but for which the Required Mortgage Documents have not been delivered to Lender.

Other Definitional Provisions .

(a)           Unless otherwise specified therein, all terms defined in this Agreement shall have the above-defined meanings when used in the Notes or any other Loan Document, certificate, report or other document made or delivered pursuant hereto.

(b)           Each term defined in the singular form in Section 1.1 shall mean the plural thereof when the plural form of such term is used in this Agreement, the Notes or any other Loan Document, certificate, report or other document made or delivered pursuant hereto, and each term defined in the plural form in Section 1.1 shall mean the singular thereof when the singular form of such term is used herein or therein.

(c)           The words “hereof,” “herein,” “hereunder” and similar terms when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement, and section, subsection, schedule and exhibit references herein are references to sections, subsections, schedules and exhibits to this Agreement unless otherwise specified.  The word “or” is not exclusive, and the word “including” (in its various forms) means “including without limitation.”

(d)           Unless the context otherwise requires or unless otherwise provided herein, the terms defined in this Agreement which refer to a particular agreement, instrument or document also refer to and include all renewals, extensions, modifications, amendments and restatements of such agreement, instrument or document, provided that , nothing contained in this section shall be construed to authorize any such renewal, extension, modification, amendment or restatement.

(e)           As used herein, in the Notes or in any other Loan Document, certificate, report or other document made or delivered pursuant hereto, accounting terms relating to any Person and not specifically defined in this Agreement or therein shall have the respective meanings given to them under GAAP.

Section 1.2                      Exhibits and Schedules

.  All Exhibits and Schedules attached to this Agreement are incorporated by reference herein and made a part hereof for all purposes.

.  All calculations under the Loan Documents of interest and of fees shall be made on the basis of actual days elapsed (including the first day but excluding the last) and a year of three hundred sixty (360) days.  Each determination by Lender of amounts to be paid hereunder shall, in the absence of manifest error, be conclusive and binding.  Unless otherwise expressly provided herein or unless Lender otherwise consents all financial statements and reports furnished to Lender hereunder shall be prepared and all financial computations and determinations pursuant hereto shall be made in accordance with GAAP.  The Administrative Agent shall deliver to the Borrower an interest billing statement for each month on or before the fifth (5th) day of the next succeeding month, which interest billing statement shall set forth the interest accrued on the Loans for such month; provided that , any failure or delay in delivering such interest billing or any inaccuracy therein shall not affect the Obligations.

Section 2.1                       Commitment and Loans

.  Subject to the terms and conditions contained in this Agreement, each Lender severally agrees to make loans (“ Loans ”) to the Borrower on a revolving credit basis from time to time on any Business Day from the date of this Agreement through the Drawdown Termination Date.  The aggregate amount of all Loans requested in any Borrowing Request must be equal to the lesser of (i) an amount greater than or equal to $25,000 or (ii) an amount equal to the Aggregate Commitments less the Loan Balance.  Notwithstanding anything to the contrary, after giving effect to the transactions contemplated by the Borrowing Request pursuant to which a Loan is requested, and at all other times, the aggregate unpaid principal amount of all Loans outstanding shall not exceed the lesser of (a) the Collateral Value of the Borrowing Base, and (b) the Aggregate Commitments.

Section 2.2                       Promissory Notes; Interest on the Notes

.  The obligation of the Borrower to repay the Loans made by the Lenders, together with interest accruing in connection therewith, shall be evidenced by a Note payable to the order of each Lender. Interest shall accrue on the unpaid balance of the Loans at an interest rate per annum equal to Adjusted Floating LIBOR and shall be payable on the fifteenth day of each calendar month, beginning May 15, 2009.  Interest on the Notes shall be due and payable as provided herein and therein.  The entire Loan Balance and all accrued and unpaid interest thereon shall be finally due and payable on the Drawdown Termination Date.

Section 2.3                       Notice and Manner of Obtaining Loans

.  The Borrower must give written notice (which may be sent by electronic mail) to the Administrative Agent, or telephonic notice promptly confirmed in writing, of each request for Loans.  Each such written request or confirmation must be made in the form and substance of the “ Borrowing Request ” attached hereto as Exhibit B , duly completed.  Each such Borrowing Request must:

(a)           specify the aggregate amount of any such Borrowing of new Loans and the date on which such Loans are to be advanced; and

(b)           be received by the Administrative Agent not later than (i) 2:00 p.m., Eastern time, if there is only one Lender or (ii) 1:00 p.m., Eastern time, if there is more than one Lender, on the day on which any such Loans are to be made.

With each delivery of a Borrowing Request to the Administrative Agent, the Borrower represents and warrants to the Administrative Agent the following:

(i)           the Borrower is entitled to receive the requested Loan under the terms and conditions of this Agreement;

(ii)           all items which the Borrower is required to furnish to the Administrative Agent pursuant to this Agreement accompany the Borrowing Request (or, if Wet Loans, shall be delivered to the Administrative Agent in accordance with the Agreement);

(iii)           all Mortgage Loans offered thereby conform in all respects with the applicable requirements set forth in this Agreement;

(iv)           no Event of Default exists under this Agreement or would result from the Borrowing or the application of the proceeds therefrom;

(v)           no change or event has occurred which with notice and/or the passage of time would constitute an Event of Default;

(vi)           after giving effect to the Loan requested thereby the Loan Balance shall not exceed the lesser of (1) the Collateral Value of the Borrowing Base and (2) the Aggregate Commitments; and

(vii)           after giving effect to the Loans requested thereby, no Applicable Sublimit will be exceeded.

Additionally, with each Borrowing Request, the Borrower represents and warrants that, except as permitted under this Agreement, the Borrower holds with respect to each of the Mortgage Notes the following:

(i)           unless delivered therewith, a certified copy of the Mortgage relating to such Mortgage Note;

(ii)           mortgagee policies of title insurance conforming to the requirements of the Administrative Agent or binding commitments for the issuance of same;

(iii)           insurance policies insuring the premises subject to the Mortgage and naming the Borrower as lender loss payee, each as required by the Administrative Agent; and

(iv)           unless delivered therewith, an original of any executed Take-Out Commitment or document evidencing any Hedging Arrangement relating to such Mortgage Note.

With the delivery of each Borrowing Request, the Borrower agrees that it holds the above referenced items in trust for the Administrative Agent, and will at any time deliver the same to the Administrative Agent upon request or, upon written instructions from the Administrative Agent, to any Person designated by the Administrative Agent, promptly, and in any event within two (2) Business Days after such request or instructions.  The Borrower further agrees that it will not deliver any of the above items, nor give, transfer, or assign any interest in same, to any Person other than the Administrative Agent (or the Person or Persons designated by the Administrative Agent) without the prior written consent of the Administrative Agent.

Each such telephonic request shall be deemed a representation, warranty, acknowledgment and agreement by the Borrower as to the matters which are required to be set out in such written confirmation.  If all conditions precedent to such Loan have been met, the Administrative Agent will, promptly upon receipt of funds from the Lenders, on the date remit to the Borrower the amount of such Loan in immediately available dollars, by crediting the Funding Account with immediately available funds in the amount of such Loan.

Section 2.4                       Fees .

(a)           In consideration of the Lenders’ commitment to make the Loans, the Borrower will pay to the Administrative Agent for the pro rata account of each Lender a non-refundable unused fee determined on a daily basis by applying a rate of 45.0 basis points (0.45%) per annum to the unused amount of each such Lender’s Commitment on each day during the term of the Loans.  This unused fee shall be due and payable quarterly in arrears on the fifteenth (15 th ) day following each Fiscal Quarter.

(b)           The Borrower shall pay to the Administrative Agent, an annual maintenance fee in the amount and at the time set forth in the Fee Letter.

(c)           In further consideration of the Lenders’ commitment to make the Loans, the Borrower will pay to the Administrative Agent for the pro rata account of each Lender a non-refundable closing fee in the amount and at the time set forth in the Fee Letter.

Section 2.5                       Mandatory Repayments

.  If at any time the Loan Balance exceeds the lesser of (i) the Collateral Value of the Borrowing Base (as a result of an Applicable Sublimit being exceeded or otherwise) or (ii) the Aggregate Commitments, then the Borrower (x) shall repay the amount of such excess or (y) so long as the Loan Balance does not exceed the Aggregate Commitments, pledge to the Administrative Agent additional Eligible Mortgage Loans which have an aggregate Unit Collateral Value equal to or greater than such excess, in each case, within two (2) Business Days after the Borrower becomes aware of any such Borrowing Base deficiency; provided that , after giving effect to any pledge of additional Eligible Mortgage Loans, the Unit Collateral Value of such Mortgage Loans when added to the Unit Collateral Value of all other Mortgage Loans in the same Mortgage Loan classification does not exceed the Applicable Sublimit for such Mortgage Loan classification.

Section 2.6                      Payments to the Administrative Agent

.  All payments of interest on the Notes, all payments of principal, including any principal payment made with proceeds of Mortgage Collateral, and fees hereunder shall be made directly to the Administrative Agent without condition or deduction or any counterclaim, defense, recoupment, setoff, or withholding or deduction for taxes, for the pro rata benefit of each Lender, in federal or other immediately available funds before (a) 3:00 p.m. (Eastern time) if there is only one Lender and (b) 1:00 p.m. (Eastern time) if there is more than one Lender, in each case on the respective dates when due via wire transfer of immediately available funds to the Settlement Account.  The Administrative Agent shall promptly distribute such payments to the Lenders upon receipt in like funds as received.  The Borrower shall send notice to the Administrative Agent before (a) 3:00 p.m. (Eastern time) if there is only one Lender and (b) 12:00 noon (Eastern time) if there is more than one Lender, in each case on the day any payment of principal or interest is received by the Administrative Agent which sets forth the Loans against which such payment is to be applied.  Any payment (or any payment received without a notice regarding application of such payment) received by the Administrative Agent after such time will be deemed to have been made on the next following Business Day.  Should any such payment become due and payable on a day other than a Business Day, the maturity of such payment shall be extended to the next succeeding Business Day, and, in the case of a payment of principal or past due interest, interest shall accrue and be payable thereon for the period of such extension as provided in the Loan Document under which such payment is due.  Each payment under a Loan Document shall be payable at the place provided therein and, if no specific place of payment is provided, shall be payable at the place of payment of the Notes.  Prior to the occurrence of an Event of Default and exercise of remedies by the Administrative Agent, when the Administrative Agent collects or receives money on account of the Obligations, the Administrative Agent shall apply all such money so distributed, as follows:

(a)           first, to any reimbursements due the Administrative Agent under Section 5.5 ;

(b)           second, to any reimbursement due to the Lenders under Section 5.5 ;

(c)           third, prior to a Default or Event of Default, to the payment of the Loans then due, as directed by the Borrower

(d)           fourth, to the prepayment of principal on the Notes, together with accrued and unpaid interest on the principal so prepaid; and

(e)           last, for the payment or prepayment of any other Obligations and the balance, if any, after all the Obligations have been indefeasibly paid in fully, to the Borrower or as otherwise required by Law.

All payments applied to principal or interest on any Note shall be applied first to any interest then due and payable, then to principal then due and payable, and last to any prepayment of principal and interest.

Section 2.7                       Notification by the Administrative Agent

.  Promptly after receipt thereof, the Administrative Agent will notify each Lender of the contents of each Borrowing Request and repayment notice received by it hereunder.  Upon the request of the Administrative Agent, not

later than 1:00 p.m. (Eastern time) on the day on which any Loans are to be made, each Lender shall make available its pro rata portion of the Loan or Loans in accordance with such Lender’s Commitment in immediately available funds to the Administrative Agent at its address specified on the Administrative Agent’s signature page hereto.

Section 2.8                       Non-Receipt of Funds by the Administrative Agent .

(a)           Unless the Administrative Agent shall have been notified in writing by any Lender prior to a Borrowing that such Lender will not make the amount that would constitute its share of such Borrowing available to the Administrative Agent, the Administrative Agent may assume that such Lender is making such amount available to the Administrative Agent, and the Administrative Agent may, in its sole and absolute discretion, in reliance upon such assumption, make available to the Borrower a corresponding amount.  If such amount is not made available to the Administrative Agent by the required time therefor, and Administrative Agent elects to make such corresponding amount available to the Borrower, such Lender shall pay to the Administrative Agent, on demand, such amount with interest thereon, at a rate equal to the greater of the Federal Funds Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation, plus any administrative, processing or similar fees charged by the Administrative Agent in connection with the foregoing, for the period until such Lender makes such amount immediately available to the Administrative Agent.  A certificate of the Administrative Agent submitted to any Lender with respect to any amounts owing under this paragraph shall be conclusive in the absence of manifest error.  If such Lender's share of such Borrowing is not made available to the Administrative Agent by such Lender within three (3) Business Days after such Borrowing date, the Administrative Agent shall also be entitled to recover such amount with interest thereon at the rate per annum applicable to the relevant Loan, on demand, from the Borrower.  Nothing in this Section shall be deemed to limit the rights of the Borrower against any such Lender.

(b)           Unless the Administrative Agent shall have been notified in writing by the Borrower prior to the date of any payment due to be made by the Borrower hereunder that the Borrower will not make such payment to the Administrative Agent (including but not limited to situations in which the Borrower informs the Administrative Agent that the Administrative Agent will be receiving proceeds of Collateral on a specific date and that the Borrower intends to use such proceeds to make a payment of principal), the Administrative Agent may assume that the Borrower is making such payment, and the Administrative Agent may, but shall not be required to, in reliance upon such assumption, make available to the Lenders their respective pro rata shares of a corresponding amount.  If such payment is not made to the Administrative Agent by the Borrower within three (3) Business Days after such due date, the Administrative Agent shall be entitled to recover, on demand, from each Lender to which any amount which was made available pursuant to the preceding sentence, such amount with interest thereon at the rate per annum equal to the greater of the Federal Funds Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation, plus administrative, processing or similar fees charged by the Administrative Agent in connection with the foregoing.  Nothing in this Section shall be deemed to limit the rights of the Administrative Agent or any Lender against the Borrower.

Section 2.9                      Increased Cost and Reduced Return.

(a)           If, after the Effective Date, any Lender shall have determined that the adoption of any applicable Law, rule, or regulation regarding capital adequacy or any change therein or in the interpretation or administration thereof by any Governmental Authority, central bank, or comparable agency charged with the interpretation or administration thereof, or any request or directive regarding capital adequacy (whether or not having the force of Law) of any such Governmental Authority, central bank, or comparable agency, has or would have the effect of reducing the rate of return on the capital of such Lender or any corporation controlling such Lender, due to the obligations of such Lender hereunder, to a level below that which such Lender or such corporation could have achieved but for such adoption, change, request, or directive (taking into consideration its policies with respect to capital adequacy), then, within fifteen (15) days after demand by such Lender, the Borrower shall pay to such Lender such additional amount or amounts as will compensate such Lender for such reduction, but only to the extent that such Lender has not been compensated therefor by any increase in Floating LIBOR.

(b)           Each Lender shall promptly notify the Borrower of any event of which it has knowledge, occurring after the Effective Date, which will entitle such Lender to compensation pursuant to this Section.  In the event that any Lender claims compensation under this Section, such Lender shall furnish to the Borrower a statement setting forth the additional amount or amounts to be paid to it hereunder which shall be conclusive in the absence of manifest error.  In determining such amount, such Lender shall act in good faith and may use any reasonable averaging and attribution methods.

Section 2.10                       Settlement Account

.  The Borrower shall not be entitled to withdraw funds from the Settlement Account.  Except upon the occurrence of any Event of Default, to the extent that on any Business Day amounts in the Settlement Account exceed the amount needed in order to maintain the Collateral Value of the Borrowing Base at an amount equal to or greater than the amount of the Loan Balance, the Administrative Agent shall cause such excess amount to be automatically transferred to any Operating Account designated by the Borrower or as the Borrower may otherwise direct the application of such excess amount.  If on any Business Day the amount in the Settlement Account is less than the amount needed to maintain the Collateral Value of the Borrowing Base in an amount equal to or greater than the amount of the Loan Balance, and the Borrower has not made any payment as provided in Section 2.5 , the Administrative Agent may cause an amount equal to such deficiency to be transferred from any Operating Account to the Settlement Account.

The obligation of the Lenders to make Loans hereunder is subject to fulfillment of the conditions precedent stated in this Article III .

Section 3.1                       Initial Loan

.  The obligation of the Lenders to fund any Loan hereunder shall be subject to, in addition to the conditions precedent specified in Section 3.2 , the following terms and conditions:

(a)           The Borrower shall have delivered to the Administrative Agent the following (each of the following documents being duly executed and delivered and in form and substance satisfactory to each Lender, and, with the exception of the Notes, each in a sufficient number of originals that each Lender, the Administrative Agent and its counsel may have an executed original of each document):

(i)           an executed counterpart of this Agreement and of all instruments, certificates and opinions referred to in this Article III not theretofore delivered (except the Borrowing Request, which is to be deliv