SECOND AMENDED AND RESTATED SALE AND SERVICING AGREEMENT

Exhibit 10.2

COMPOSITE VERSION:
REFLECTS ALL AMENDMENTS THROUGH JULY 14, 2009

SECOND AMENDED AND RESTATED
SALE AND SERVICING AGREEMENT

by and among

CS FUNDING VII DEPOSITOR LLC,
as the Seller

CAPITALSOURCE FINANCE LLC,
as the Originator and as the Servicer

EACH OF THE ISSUERS
FROM TIME TO TIME PARTY HERETO,

EACH OF THE LIQUIDITY BANKS
FROM TIME TO TIME PARTY HERETO

CITICORP NORTH AMERICA, INC.,
as the Administrative Agent

and

WELLS FARGO BANK, NATIONAL ASSOCIATION,
as the Backup Servicer and as the Collateral Custodian

Dated as of May 8, 2008

as
Amended and Restated
as of

April 20, 2009

and as
Amended and Restated
as of

June 16, 2009

CONFORMED THROUGH FIRST AMENDMENT, DATED JULY 14, 2009

COMMERCIAL LOAN-BACKED VARIABLE FUNDING CERTIFICATES

TABLE OF CONTENTS

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SECOND AMENDED AND RESTATED SALE AND SERVICING AGREEMENT

      SECOND AMENDED AND RESTATED SALE AND SERVICING AGREEMENT (such agreement as amended, modified, supplemented, restated or replaced from time to time, the “ Agreement ”) dated as of May 8, 2008, as amended by the First Amendment, dated as of July 31, 2008, the Second Amendment, dated as of August 20, 2008, and the Extension and Third Amendment, dated as of March 30, 2009, and as amended and restated as of April 20, 2009 and as AMENDED AND RESTATED as of June 16, 2009, by and among:

     (1)  CS FUNDING VII DEPOSITOR LLC , a Delaware limited liability company, as the seller hereunder (together with its successors and assigns in such capacity, the “ Seller ”);

     (2)  CAPITALSOURCE FINANCE LLC , a Delaware limited liability company (“ CSF ”), as the loan originator (together with its successors and assigns in such capacity, the “ Originator ”), and as the servicer (together with its successors and assigns in such capacity, the “ Servicer ”);

     (3)  EACH OF THE ISSUERS FROM TIME TO TIME PARTY HERETO (together with their respective successors and assigns in such capacities, each an “ Issuer ”);

     (4)  EACH OF THE LIQUIDITY BANKS FROM TIME TO TIME PARTY HERETO (together with their respective successors and assigns in such capacities, each a “ Liquidity Bank ”);

     (5)  CITICORP NORTH AMERICA, INC., a Delaware corporation (“ CNAI ”), as the administrative agent for the Issuers and Liquidity Banks hereunder (together with its successors and assigns in such capacity, including any successor appointed pursuant to ARTICLE XII , the “ Administrative Agent ”); and

     (6)  WELLS FARGO BANK, NATIONAL ASSOCIATION (“ Wells Fargo ”), not in its individual capacity but as the backup servicer (together with its successors and assigns in such capacity, the “ Backup Servicer ”), and not in its individual capacity but as the collateral custodian (together with its successors and assigns in such capacity, the “ Collateral Custodian ”).

RECITALS

      WHEREAS , the Seller has acquired, and may from time to time continue to acquire, certain Assets on the Asset List (each, as defined below) from the Originator pursuant to the Sale Agreement (as defined below);

      WHEREAS , immediately prior to the New Effective Date, CSF and its Affiliates entered into the 2009 Restructuring (as defined below);

      WHEREAS , pursuant to the initial Amendment and Restatement, dated as of April, 2009, the Administrative Agent and the Liquidity Banks agreed to modify certain financial covenants, to extend the Termination Date and to provide additional Availability under the Agreement, and consented to the 2009 Restructuring, in the manner set forth therein,;

      WHEREAS , the parties hereto wish to AMEND AND RESTATE this Agreement on the date hereof in the manner set forth herein;

      NOW, THEREFORE, based upon the foregoing Recitals, the mutual premises and agreements contained herein, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto, intending to be legally bound, hereby agree to AMEND AND RESTATE the Agreement, effective as of the A&R Effective Date as follows:

ARTICLE I

DEFINITION

           Section 1.1 Certain Defined Terms .

     Certain capitalized terms used throughout this Agreement are defined above or in this Section 1.1 . As used in this Agreement and its schedules, exhibits and other attachments, unless the context requires a different meaning, the following terms shall have the following meanings:

“ 1940 Act ”: The Investment Company Act of 1940, as amended.

“ 2007-A/LLC ”: CapitalSource Real Estate Loan LLC, 2007-A, together with its permitted successors and assigns.

“ 2007-A Eligible Asset ”: An Asset on the Asset List that is an “Eligible Asset” within the meaning of that term in the 2007-A Facility and which, on the New Effective Date, is listed on the Asset List and has a Loan Threshold Amount equal to zero.

“ 2007-A Facility ”: The meaning set forth in the defined term “Citibank Facilities”.

“ 2007-A Pledge Agreement ”: That certain Pledge Agreement, dated as of the New Effective Date, pledging the equity interests in 2007-A/LLC held by the Seller in favor of the Administrative Agent, in substantially the form attached hereto as Exhibit 09-C , as such agreement may be amended, modified or supplemented from time to time in accordance with its terms.

“ 2007-A Aggregate Outstanding Asset Balance ”: The meaning set forth for “Aggregate Outstanding Asset Balance” under the 2007-A Facility.

“ 2007-A Special Reduction Amount ”: The meaning set forth for “Special Reduction Amount” under the 2007-A Facility.

“ 2009 CS Secured Note Issuance ”: The issuance of up to $300 million aggregate principal amount of first priority senior secured notes due 2014 issued by CapitalSource Inc. pursuant to that certain Indenture to be entered into on or prior to September 30, 2009, by and among CapitalSource Inc., the guarantors named therein and U.S. Bank, National Association, as trustee and collateral agent.

“ 2009 Restructuring ”: The restructuring of CapitalSource Inc. and its Subsidiaries substantially in the manner set forth in the memorandum and the chart attached hereto as Exhibit 09-A for the purpose of accruing certain tax, accounting and corporate operational benefits for CapitalSource Inc. and its Subsidiaries.

“ 2009 Restructuring Documents ”: The documents, agreements and certificates, including all formation documents, certificates, contribution agreements, operating agreements and related matters entered into in connection with the effectuation of the 2009 Restructuring, all of which have been attached hereto as Exhibit 09-B .

“ A&R Effective Date ”: June 16, 2009, being the date that the conditions precedent set forth in Section 3.5 have been fulfilled to the satisfaction of the Administrative Agent.

“ Account Control Agreement ”: The Account Control Agreement, dated as of the A&R Effective Date, among the Seller, the Servicer, the Administrative Agent, the Collateral Custodian and the Securities Intermediary, as amended, modified, waived, supplemented, restated or replaced from time to time.

“ Accrual Period ”: (a) with respect to each Advance (or portion thereof) funded at an Interest Rate other than the CP Rate, (i) with respect to the first Payment Date, the period from and including the Closing Date to but excluding such first Payment Date and (ii) with respect to any subsequent Payment Date, the period from and including the previous Payment Date to but excluding such subsequent Payment Date, and (b) with respect to each Advance (or portion thereof) funded at an Interest Rate equal to the CP Rate, (i) with respect to the first Payment Date, the period from and including the Closing Date to and including the last day of the calendar month in which the Closing Date occurs and (ii) with respect to any subsequent Payment Date, the period ending on the last day of the calendar month immediately preceding the month in which the Payment Date occurs and commencing on the first day of such immediately preceding calendar month.

“ Acquired Loan ”: A Loan (other than an Excluded Loan) that is either (a) originated by a Person other than the Originator, CapitalSource Inc. or any of their respective Subsidiaries and is acquired by the Originator, CapitalSource Inc. or any of their respective Subsidiaries in an arm’s length transaction from an unaffiliated third party; or (b) extended by the Originator, CapitalSource Inc. or any of their respective Subsidiaries directly to the Obligor as part of a multi-lender Loan in which neither CapitalSource Inc. nor any of its Subsidiaries is the administrative (or other analogous) agent; provided that the calculation of the principal amount of any Acquired Loan hereunder shall exclude any Retained Interest with respect to such Acquired Loan.

“ Addition Date ”: With respect to any Additional Assets, the date on which such Additional Assets become part of the Collateral.

“ Additional Amount ”: Defined in Section 2.16(a).

“ Additional Assets ”: All Assets that become part of the Collateral after the Closing Date.

“ Additional Commitment Amount ”: An amount equal to (i) commencing on the Additional Commitment Success Date, $50,000,000, and (ii) either prior to the occurrence of the Additional Commitment Success Date or on and following the Revolving Period Fail Date, zero.

“ Additional Commitment Success Date ”: The date, prior to the Revolving Period Fail Date, on which both the Wachovia Amendment Date and the Reserve Funding Date have occurred.

“ Adjusted Eurodollar Rate ”: For any Accrual Period, an interest rate per annum equal to a fraction, expressed as a percentage and rounded upwards (if necessary) to the nearest 1/100 of 1%, (i) the numerator of which is equal to the offered quotation to first-class banks in the New York interbank Eurodollar market by the Administrative Agent for Dollar deposits of amounts in same day funds comparable to the outstanding principal amount of the Advance for which an interest rate is then being determined with maturities comparable to the Accrual Period to be applicable to such Advance, determined as of 10:00 a.m. (New York City, New York time) on the date which is two Business Days prior to the commencement of such Accrual Period (and rounded upward to the next whole multiple of 1/16 of 1%) to a fraction, expressed as a percentage and rounded upwards (if necessary) to the nearest

1/100 of 1%, and (ii) the denominator of which is equal to 100% minus the Eurodollar Reserve Percentage for such Accrual Period.

“ Administrative Agent ”: Defined in the Preamble of this Agreement.

“ Advance ”: Defined in Section 2.1(b) .

“ Advance Rate ”: On any Business Day, with respect to each Loan, a percentage determined as follows:

provided, however , in no event shall the Advance Rate with respect to New Advances exceed 50%.

For purposes of calculating the Advance Rate with respect to any Acquired Loans, Agented Loans and Participation Loans, the applicable Advance Rate will be determined by reference to the type of underlying Loan being acquired, assigned, agented or participated in, as the case may be.

“ Advances Outstanding ”: On any day, the aggregate principal amount of all Advances outstanding on such day, after giving effect to all repayments of Advances and the making of new Advances on such day.

“ Affected Party ”: The Administrative Agent, the Purchasers, each Liquidity Bank, all assignees, participants and Affiliates of the Purchasers and each Liquidity Bank, any successor to CNAI as Administrative Agent and any sub-agent of the Administrative Agent.

“ Affiliate ”: With respect to a Person, means any other Person that, directly or indirectly, controls, is controlled by or under common control with such Person, or is a director or officer of such Person. For purposes of this definition, “control” (including the terms “controlling,” “controlled by” and “under common control with”) when used with respect to any specified Person means the possession, direct or indirect, of the power to vote 20% or more of the voting securities of such Person or to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by contract or otherwise.

“ Agent’s Account ”: A special account (account number 40517805) in the name of the Administrative Agent maintained at Citibank, N.A.

“ Agented Loans ”: With respect to any Loan, one or more loans to an Eligible Obligor wherein (a) the loan(s) are originated by the Originator in accordance with the Credit and Collection Policy as a part of a loan transaction that has been fully consummated between the Originator and the related Obligor (without regard to any subsequent syndication of such Loan) prior to such Agented Loans becoming part of the Collateral hereunder, (b) upon an assignment of the loan under the Sale Agreement to the Seller, any

original note related thereto will be endorsed to the Administrative Agent and held by the Collateral Custodian, on behalf of the Secured Parties, (c) the Seller, as assignee of the loan, will have all of the rights but none of the obligations of the Originator with respect to such loan and the Originator’s right, title and interest in and to the Related Property including the right to receive and collect payments directly in its own name and to enforce its rights directly against the Obligor thereof, (d) the loan, if secured, is secured by an undivided interest in the Related Property that also secures and is shared by, on a pro rata basis, all other holders of such Obligor’s loan of equal priority and (e) the Originator (or a wholly owned subsidiary of the Originator) or CSE Mortgage LLC is the administrative (or other analogous) agent for loans to such Obligor.

“ Aggregate Existing Loan Balance ”: On any date of determination, the sum of the Existing Loan Balances of all Eligible Assets included as part of the Collateral on such date.

“ Aggregate Outstanding Asset Balance ”: On any date of determination, the sum of the Outstanding Asset Balances of all Eligible Assets included as part of the Collateral on such date.

“ Aggregate Unpaids ”: At any time, an amount equal to the sum of all unpaid Advances Outstanding, Interest, Breakage Costs, Hedge Breakage Costs and all other amounts owed by the Seller to the Purchasers, the Administrative Agent, the Backup Servicer, each Hedge Counterparty and the Collateral Custodian hereunder (including, without limitation, all Indemnified Amounts, other amounts payable under Article XI and amounts required under Section 2.9 , Section 2.10 , Section 2.14 , Section 2.15 and Section 2.16 to the Affected Parties or Indemnified Parties) or under any Hedging Agreement (including, without limitation, payments in respect of the termination of any such Hedging Agreement) or by the Seller or any other Person under any fee letter (including, without limitation, the Purchaser Fee Letter, the Backup Servicer and Collateral Custodian Fee Letter) delivered in connection with the transactions contemplated by this Agreement (whether due or accrued).

“ Alarm Service Loan ”: An Eligible Loan to a Dealer (or any other Person agreed to by the Administrative Agent) that has secured its repayment obligations with the payments from one or more individuals, businesses or other entities that have entered into security alarm monitoring or security alarm monitoring and maintenance contracts to receive the security alarm monitoring or security alarm monitoring and maintenance services provided thereby.

“ Allocation Adjustment Event ”: With respect to each Loan included in the Collateral subject to the Retained Interest provisions of this Agreement, the occurrence of any one or more of the following under and as defined in any Permitted Securitization Transaction rated by the Rating Agencies, as applicable: (i) a “Servicer Default”, (ii) an “Event of Default” or (iii) an “Accelerated Amortization Event”.

“ Alternative Rate ”: An interest rate per annum equal to the Adjusted Eurodollar Rate calculated on a daily basis; provided that the Alternative Rate shall be the Base Rate (i) for all Advances of any Liquidity Bank which has provided a notice pursuant to clause (a), (b), (c) or (d) of the definition of Eurodollar Disruption Event and (ii) for the relevant Advances of any Liquidity Bank which has provided a notice pursuant to clause (e) of the definition of Eurodollar Disruption Event.

“ Amortization Period ”: Any period between the New Effective Date and the Termination Date that the Revolving Period is not in effect.

“ Amortization Period Fee ”: With respect to any Purchaser, as defined in such Purchaser’s Purchaser Fee Letter.

“ Applicable Law ”: For any Person or property of such Person, all existing and future applicable laws, rules, regulations (including proposed, temporary and final income tax regulations), statutes, treaties, codes, ordinances, permits, certificates, orders and licenses of and interpretations by any Governmental Authority (including, without limitation, usury laws, the Federal Truth in Lending Act, and Regulation Z and Regulation B of the Board of Governors of the Federal Reserve System), and applicable judgments, decrees, injunctions, writs, awards or orders of any court, arbitrator or other administrative, judicial, or quasi-judicial tribunal or agency of competent jurisdiction.

“ Appraisal ”: With respect to any Mortgaged Property as to which an appraisal is required or permitted to be performed pursuant to the terms of this Agreement, an appraisal performed in conformance with the guidelines of the Appraisal Institute.

“ Appraisal Institute ”: The international membership association of professional real estate appraisers.

“ Approved Dealers ”: With respect to any Acquired Loan, (A) the nationally recognized dealers set forth on Schedule VIII hereto and (B) any other nationally recognized dealers that either are (x) designated by the Administrative Agent, acting in its reasonable discretion or (y) proposed by the Servicer by notice to the Administrative Agent and approved by the Administrative Agent in its sole discretion, and that (in case of both clauses (x) and (y)) are (1) Independent of each other, (2) Independent of the Originator and the Servicer and (3) regularly deal in assets in the nature of such Acquired Loan; provided , however , that, the Administrative Agent may designate dealers to be added to, or removed from, the aforementioned Schedule VIII from time to time (and, upon any such designation, such Schedule VIII shall be deemed to have been amended to reflect such designation without further action by any Person).

“ Approved Pricing Service ”: (A) the pricing services set forth on Schedule VIII hereto and (B) any other pricing services that either are (x) designated by the Administrative Agent in its sole discretion or (y) proposed by the Servicer by notice to the Administrative Agent and approved by the Administrative Agent in its sole discretion; provided , however , that, in the case of both clauses (A) and (B), unless otherwise agreed by the Administrative Agent, an Acquired Loan will be considered to be “priced” or “quoted” by an Approved Pricing Service only if, in the reasonable judgment of the Administrative Agent, such Approved Pricing Service will continue to provide quotations with respect to such Acquired Loan on an on-going basis in the ordinary course of its business as a pricing service.

“ Approved Valuation Agent ”: Any Independent third-party appraisal firm designated by the Servicer in writing to the Administrative Agent and approved by the Administrative Agent in its reasonable discretion.

“ Asset Checklist ”: The list of loan documents delivered by or on behalf of the Seller to the Collateral Custodian that identifies each of the items contained in the related Asset File, as amended from time to time.

“ Asset Files ”: With respect to any Asset, as applicable, and Related Security, copies of each of the Required Asset Documents and duly executed originals (to the extent required by the Credit and Collection Policy) and copies of any other Records relating to such Asset and Related Security.

“ Asset List ”: The Asset List dated as of the New Effective Date and provided by or on behalf of the Seller to the Administrative Agent and the Collateral Custodian, in the form of Schedule IV hereto, which Asset List shall contain (i) Loans owned by the Seller on the New Effective Date (including the Loan Threshold Amount of each such Loan) and (ii) additional fundings on or following the New Effective Date with respect to specified revolving loans approved by the Administrative Agent that are currently funded under the 2007-A Facility and may be acquired by the Seller on or following the New Effective

Date, to the extent that such loans qualify as of the date of the initial Advance with respect thereto as Eligible Assets.

“ Asset Valuation Date ”: With respect to any Acquired Loan:

     (1) the Market Value of which is determined with reference to clause (i)(B)(1) of the definition of Market Value, (x) the last day of each calendar month and (y) each date that a Borrowing Base Certificate is delivered;

     (2) the Market Value of which is determined with reference to clauses (i)(B)(2) and (i)(B)(3) of the definition of Market Value, (x) the last day of each calendar month and (y) each other date requested by the Administrative Agent; provided that on any date that the Aggregate Outstanding Asset Balance of all Assets whose Market Value is determined in accordance with clauses (i)(B)(2) or (i)(B)(3) of the definition of Market Value, is less than $50,000,000, clauses (x) and (y) of the preceding sentence shall be replaced with the following: (x) each Quarterly Determination Date and (y) each other date requested by the Administrative Agent.

“ Assets ”: Loans and Rated Retained Securities, individually or collectively, as the context requires.

“ Assignment and Acceptance ”: An assignment and acceptance agreement entered into by a Purchaser, an Eligible Assignee and the Agent, pursuant to which such Eligible Assignee may become a party to this Agreement, in substantially the form of Exhibit M hereto.

“ Assignment of Leases and Rents ”: With respect to any Mortgaged Property, any assignment of leases, rents and profits or similar instrument executed by the Obligor, assigning to the mortgagee all of the income, rents and profits derived from the ownership, operation, leasing or disposition of all or a portion of such Mortgaged Property, whether contained in the Mortgage or in a document separate from the Mortgage, in the form that was duly executed, acknowledged and delivered, as amended, modified, renewed or extended through the Closing Date and from time to time hereafter in accordance with the Credit and Collection Policy.

“ Assignment of Mortgage ”: As to each Loan (other than Agented Loans or Acquired Loans that have been syndicated and with respect to which neither the Originator nor any of its Affiliates is acting in the capacity of administrative agent, and other Loans for which an Assignment of Mortgage has been delivered to Wells Fargo in its capacity as trustee or custodian pursuant to a prior term transaction or warehouse facility involving the Originator or one of its Affiliates) secured by an Interest in Real Property, one or more assignments, notices of transfer or equivalent instruments, each in recordable form and sufficient under the laws of the relevant jurisdiction to reflect the transfer of the related Mortgage or similar security instrument and all other documents related to such Loan and to the Seller and to grant a perfected lien thereon by the Seller in favor of the Administrative Agent, on behalf of the Secured Parties, each such Assignment of Mortgage to be substantially in the form of Exhibit I hereto.

“ Availability ”: At any time, an amount equal to the excess, if any, of (i) the lesser of (a) the Facility Amount and (b) the Maximum Availability over (ii) the Advances Outstanding on such day; provided that (x) during the Amortization Period, or (y) at any time that the Combined Advances Outstanding exceeds the Combined Commitment Amount, the Availability shall be zero.

“ Available Funds ”: With respect to any Payment Date, all amounts received in the Collection Account (including, without limitation, any Collections on the Assets or REO Assets included in the Collateral and earnings from Permitted Investments in the Collection Account) and the Lock-Box Account (to the extent

deposited in the Collection Account in accordance with the provisions of this Agreement) during the Collection Period immediately preceding such Payment Date.

“ Average Pool Charged-Off Ratio ”: As of any Determination Date, the percentage equivalent of a fraction (i) the numerator of which is equal to the sum of the Outstanding Asset Balance of all Assets that became Charged-Off Assets (net of Recoveries during such Collection Period) during the Collection Period related to such Determination Date and each of the 11 preceding Determination Dates (or such lesser number as shall have elapsed as of such Determination Date), and (ii) the denominator of which is equal to a fraction the numerator of which is the sum of the Aggregate Outstanding Asset Balance as of the first day of the Collection Period related to such Determination Date and each of the 11 preceding Determination Dates (or such lesser number as shall have elapsed as of such Determination Date) and the denominator of which is 12 (or the corresponding lesser number of Determination Dates included in the calculations described herein).

“ Average Portfolio Charged-Off Ratio ”: As of any Determination Date, the percentage equivalent of a fraction (a) the numerator of which is equal to the sum of the portion of the outstanding balance of all Investment Loans of CapitalSource Inc. and its Consolidated Subsidiaries that became Charged-Off Investment Loans (net of recoveries) during the preceding 12 months, and (b) the denominator of which is equal to a fraction the numerator of which is the sum of the outstanding balance of all Investment Loans of CapitalSource Inc. and its Consolidated Subsidiaries at the beginning of each of the preceding 12 months, and the denominator of which is twelve; provided , that , Liquid Real Estate Assets shall not be included in the calculation of the Average Portfolio Charged-Off Ratio.

“ Average Portfolio Delinquency Ratio ”: As of any Determination Date, the percentage equivalent of a fraction the numerator of which is equal to the sum of the Portfolio Delinquency Ratio on such Determination Date and each of the two preceding Determination Dates (or such lesser number as shall have elapsed as of such Determination Date) and the denominator of which is equal to three (or the corresponding lesser number of Determination Dates included in the calculations described herein).

“ Backup Servicer ”: Wells Fargo Bank, National Association, not in its individual capacity, but solely as Backup Servicer, its successor in interest pursuant to Section 7.3 or such Person as shall have been appointed as Backup Servicer pursuant to Section 7.5 .

“ Backup Servicer and Collateral Custodian Fee Letter ”: The Backup Servicer Fee Letter and Collateral Custodian Fee Letter, dated as of May 8, 2008, by and among the Servicer, the Administrative Agent, the Backup Servicer and the Collateral Custodian, as such letter may be amended, modified, supplemented, restated or replaced from time to time.

“ Backup Servicer Fee Rate ”: The rate per annum set forth in the Backup Servicer and Collateral Custodian Fee Letter as the “Backup Servicer Fee Rate.”

“ Backup Servicer Termination Notice ”: Defined in Section 7.5 .

“ Backup Servicing Fee ”: Defined in the Backup Servicer and Collateral Custodian Fee Letter.

“ Banded Floating Rate Loan ”: A Loan where the interest rate payable by the Obligor thereof fluctuates between a minimum interest rate and a maximum interest rate allowable under its Underlying Instruments.

“ Bankruptcy Code ”: The United States Bankruptcy Reform Act of 1978 (11 U.S.C. § 101, et seq .), as amended from time to time.

“ Base Rate ”: On any date, a fluctuating interest rate per annum equal to the highest of (a) the Prime Rate, (b) the CD Rate and (c) the Federal Funds Rate plus 1.5%.

“ Benefit Plan ”: Any employee benefit plan as defined in Section 3(3) of ERISA in respect of which the Seller or any ERISA Affiliate of the Seller is, or at any time during the immediately preceding six years was, an “employer” as defined in Section 3(5) of ERISA.

“ Borrowing Base ”: On any date of determination (a) during the Revolving Period or otherwise in conjunction with the making of any Advance, the Existing Loan Balances of Eligible Assets minus the amount (calculated without duplication) by which such Existing Loan Balances exceed any applicable Pool Concentration Criteria (with respect to clause (xvi) of the definition of “Pool Concentration Criteria”, Eligible Assets with the longest weighted average life shall be excluded first and, with respect to clause (xvii) of the definition of “Pool Concentration Criteria”, Eligible Assets with the lowest Loan Margin shall be excluded first), and (b) at all other times not set forth in clause (a) above, the Existing Loan Balances of Eligible Assets.

“ Borrowing Base Certificate ”: Each certificate, in the form of Exhibit A-3 , required to be delivered by the Seller along with each Borrowing Notice.

“ Borrowing Notice ”: Each notice, in the form of Exhibit A-1 or A-2 (as applicable), required to be delivered by the Seller (i) in respect of (a) the Initial Advance and each incremental Advance (as applicable), (b) any reduction of the Facility Amount or repayment of the Advances Outstanding, or (c) any reinvestment of Principal Collections under Section 2.9(b) ; and (ii) on each Determination Date.

“ Breakage Costs ”: Any amount or amounts as shall compensate a Purchaser for any loss, cost or expense incurred by such Purchaser (as determined by the Administrative Agent in its sole discretion) as a result of a prepayment by the Seller of Advances Outstanding or Interest. All Breakage Costs shall be due and payable hereunder upon demand.

“ Business Day ”: Any day other than a Saturday or a Sunday on which (a) banks are not required or authorized to be closed in Minneapolis, Minnesota or New York City, New York, and (b) if the term “Business Day” is used in connection with the determination of the LIBOR Rate, dealings in United States dollar deposits are carried on in the London interbank market.

“C AFCO ”: CAFCO, LLC, together with its successors and assigns, each as permitted pursuant to this Agreement.

“ Capital Contribution Agreement ”: That certain Capital Contribution Agreement, dated as of the New Effective Date, made by the Seller in favor of 2007-A/LLC, in substantially the form attached hereto as Exhibit 09-D , as such agreement may be amended, modified or supplemented from time to time in accordance with its terms.

“ Capital Stock ”: Any capital stock or membership interests (in the case of a limited liability company) or equivalent equity interests of CapitalSource Inc. or any Consolidated Subsidiary (to the extent issued to a Person other than CapitalSource Inc.), whether common or preferred.

“ CapitalSource Bank Entities ”: The “CapitalSource Bank Entities” under and as defined in the Credit Agreement.

“ CapitalSource Bank Transaction ”: The “CapitalSource Bank Transaction” under and as defined in the Credit Agreement.

“ CD Rate ”: A fluctuating interest rate per annum equal to 1/2 of one percent above the latest three-week moving average of secondary market morning offering rates in the United States for three-month certificates of deposit of major United States money market banks, such three-week moving average being determined weekly on each Monday (or, if such day is not a Business Day, on the next succeeding Business Day) for the three-week period ending on the previous Friday by Citibank on the basis of such rates reported by certificate of deposit dealers to and published by the Federal Reserve Bank of New York or, if such publication shall be suspended or terminated, on the basis of quotations for such rates received by Citibank from three New York certificate of deposit dealers of recognized standing selected by Citibank, in either case adjusted to the nearest 1/4 of one percent or, if there is no nearest 1/4 of one percent, to the next higher 1/4 of one percent.

“ Change-in-Control ”: Any of the following:

     (a) any “Person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) or two or more Persons acting in concert shall have acquired “beneficial ownership” (as such term is defined in Sections 13(d)-3 and 13(d)-6 of the Exchange Act), directly or indirectly, of, or shall have acquired by contract or otherwise, or shall have entered into a contract or arrangement that, upon consummation, will result in its or their acquisition of, or control over, Voting Stock of CapitalSource Inc. (or other securities convertible into such Voting Stock) representing 33-1/3% or more of the combined voting power of all Voting Stock of CapitalSource Inc.,

     (b) the replacement of greater than 50% of the Board of Directors of CapitalSource Inc. or any other “Credit Party” (as such term is defined in the Credit Agreement) over a two year period from the directors who constituted the Board of Directors at the beginning of such period, and such replacements shall not have been approved or nominated by a vote of at least a majority of the Board of Directors of CapitalSource Inc. or any other Credit Party then still in office who were either members of such Board of Directors at the beginning of such period or whose election as a member of such Board of Directors was previously so approved,

     (c) the sale, lease, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of greater than 50% of the value of the assets of CapitalSource Inc. and its Subsidiaries taken as a whole to any “Person”,

     (d) the adoption by the stockholders of CapitalSource Inc. of a plan or proposal for the liquidation or dissolution of CapitalSource Inc., or

     (e) CapitalSource Inc. shall fail to own, directly or indirectly, all of the issued and outstanding Capital Stock of CSF; or

     (f) the creation or imposition of any Lien on any limited liability company membership interests in the Seller or the New Parent; provided, however , that it shall not be a Change-in-Control if a Lien on the limited liability membership interests of the Seller or the New Parent shall be created or imposed (i) in favor of the agent and lenders in connection with the “Credit Agreement” described in clause (i) of such defined term, or (ii) in connection with (and for the sole benefit of) the 2009 CS Secured Note Issuance; or

Notwithstanding the foregoing, solely for the purpose of determining whether there has been a Change-in-Control pursuant to clause (a) above, any purchase by one or more Excluded Persons which increases any of such Excluded Persons’ direct or indirect ownership interest (whether individually or in the aggregate) in the Voting Stock of CapitalSource Inc. shall not constitute a Change-in-Control even if the amount of Voting Stock acquired or controlled by such Excluded Person(s) exceeds (whether individually or in the

aggregate) 33-1/3% of the combined voting power of all Voting Stock of CapitalSource Inc.; provided , however , that for so long as any of such Excluded Persons’ direct or indirect ownership interest in the Voting Stock of CapitalSource Inc. exceeds (individually or in the aggregate) 33-1/3% of the combined voting power of all Voting Stock of CapitalSource Inc., the initiation by CapitalSource Inc. of any action intended to terminate or having the effect of terminating the registration of its securities under Section 12(g) of the Exchange Act or intended to suspend or having the effect of suspending its obligation to file reports with the U.S. Securities and Exchange Commission under Sections 13 and 15(d) of the Exchange Act, shall constitute a Change-in-Control. For the purposes of this defined term, “Excluded Person” shall mean, each of John Delaney, Farallon Capital Management, LLC, and Madison Dearborn Partners, LLC, and “beneficial ownership” shall have the meaning provided in Rule 13d-3 of the Securities and Exchange Commission under the Exchange Act.

“ Charged-Off Asset ”: An Asset with respect to which either of the following occurs: (a) the Servicer has deemed such Asset to be “charged-off” pursuant to the criteria set forth in the Credit and Collection Policy or (b) all or any portion of one or more principal or interest payments (other than in respect of default rate interest) remain unpaid for at least 120 days from the original due date for such payment (without giving effect to any Servicer Advance thereon).

“ Charged-Off Investment Loan ”: A “Charged-Off Investment Loan” under and as defined in the Credit Agreement.

“ Charged-Off Portfolio Asset ”: A Portfolio Asset the Servicer has deemed to be “charged-off” pursuant to the criteria set forth in the Credit and Collection Policy.

“ CHARTA ”: CHARTA, LLC, together with its successors and assigns, each as permitted pursuant to this Agreement.

“ Citibank ”: Citibank, N.A.

“ Citibank Facilities ”: The securitization/warehouse facilities provided under (i) this Agreement, and (ii) the Third Amended and Restated Sale and Servicing Agreement, dated as of April 20, 2009 (the “ 2007-A Facility ”), by and among 2007-A/LLC, CSE Mortgage LLC, each of the Issuers and Liquidity Banks from time to time party thereto, Citicorp North America, Inc., as the Administrative Agent and Wells Fargo Bank, National Association, as the Backup Servicer and as the Collateral Custodian, and the related documentation with respect thereto, in each case, as now or hereafter amended, modified, supplemented, restated or replaced or substituted from time to time in accordance with their respective terms.

“ Clearing Agency ”: An organization registered as a “clearing agency” pursuant to Section 17A of the Exchange Act.

“ Closing Date ”: Either (i) for the purposes of all provisions herein and in the Transaction Documents relating to and referencing the delivery of closing documents hereunder and which are not relating to or referencing the effectiveness of this Agreement, the commitment hereunder or the funding of or accrual of the Initial Advance (including, without limitation, Section 2.1(a)), May 8, 2008, or (ii) for the purposes of all provisions herein and in the Transaction Documents relating to or referencing the effectiveness of this Agreement, the Commitment of any Purchaser, or the funding of or accrual of the Initial Advance hereunder (including, without limitation, Sections 2.1(b), 2.1(d) and 4.2), May 9, 2008.

“ Code ”: The Internal Revenue Code of 1986, as amended from time to time.

“ Collateral ”: All right, title, and interest (whether now owned or hereafter acquired or arising, and wherever located) of the Seller in all accounts, cash and currency, chattel paper, tangible chattel paper, electronic chattel paper, copyrights, copyright licenses, equipment, fixtures, general intangibles, instruments, commercial tort claims, deposit accounts, securities accounts, inventory, investment property, letter-of-credit rights, software, supporting obligations, accessions, and other property consisting of, arising out of, or related to any of the following (in each case excluding the Retained Interest and the Excluded Amounts): (i) the Existing Assets and the Additional Assets, and all monies due or to become due in payment under such Existing Assets and the Additional Assets on and after the related Cut-Off Date, including but not limited to all Collections, but excluding any Excluded Amounts; (ii) the rights (but not the obligations) of the Seller under all Transaction Documents, (iii) the Special Funding Account, (iv) the Seller’s membership interests or other equity interests in any REO Asset Owner, (v) all Related Security with respect to the Existing Assets and the Additional Assets, and (vi) all income and Proceeds of the foregoing.

“ Collateral Custodian ”: Wells Fargo Bank, National Association, not in its individual capacity, but solely as Collateral Custodian, its successor in interest pursuant to Section 8.3 or such Person as shall have been appointed Collateral Custodian pursuant to Section 8.5 .

“ Collateral Custodian Fee ”: Defined in the Backup Servicer and Collateral Custodian Fee Letter.

“ Collateral Custodian Termination Notice ”: Defined in Section 8.5 .

“ Collection Account ”: Defined in Section 6.4(f) .

“ Collection Date ”: The date following the Termination Date on which the Aggregate Unpaids have been reduced to zero and indefeasibly paid in full.

“ Collection Period ”: Each calendar month.

“ Collections ”: (a) All cash collections and other cash proceeds of any Asset, including, without limitation, Scheduled Payments, Finance Charges, Prepayments, Insurance Proceeds, all Recoveries or other amounts received in respect thereof but excluding any Excluded Amounts, (b) any cash proceeds or other funds received by the Seller or the Servicer with respect to any Related Security, (c) all payments received pursuant to any Hedging Agreement or Hedge Transaction, (d) all cash collections and cash proceeds of any REO Asset, and (e) all Deemed Collections.

“ Combined Advances Outstanding ”: As of any day, the aggregate amount of Advances Outstanding hereunder plus all “Advances Outstanding” under the 2007-A Facility.

“ Commercial Paper Notes ”: On any day, any short-term promissory notes of any Issuer issued by such Issuer in the commercial paper market.

“ Commitment ”: With respect to each Liquidity Bank the commitment of such Liquidity Bank to make Advances in accordance herewith in an amount not to exceed (a) with respect to Citibank, prior to the Termination Date, an amount equal to (i) $185,000,000 plus (ii) the Additional Commitment Amount minus (iii) the sum of (x) all Term Loan Reduction Amounts, if any, plus (y) all Special Reduction Amounts, if any, or such amount as reduced or increased by any Assignment and Acceptance Agreement or (b) on or after the Termination Date, such Liquidity Bank’s pro rata share of the aggregate Advances Outstanding. Any reduction (or termination) of the Facility Amount pursuant to the terms of this Agreement shall reduce ratably (or terminate) each Liquidity Bank’s Commitment.

“ Commitment Fee ”: With respect to any Purchaser, as defined in such Purchaser’s Purchaser Fee Letter.

“ Confirmation and Undertaking Letter ”: The Intercreditor and Lockbox Confirmation and Undertaking Letter, dated the New Effective Date, among the Administrative Agent, the Seller, the Servicer and Originator, CapitalSource Inc., CapitalSource Funding Inc. and CSF, regarding certain agreements between the parties with respect to the Lock-Box Agreement and the Intercreditor Agreement, as the Confirmation and Undertaking Letter may be amended, restated, modified or supplemented from time to time.

“ Consolidated Funded Indebtedness ”: As of any date of determination, all outstanding Indebtedness of the Originator and its Subsidiaries determined on a consolidated basis in accordance with GAAP.

“ Consolidated Subsidiary ”: At any date any Subsidiary the accounts of which, in accordance with GAAP, would be consolidated with those of CapitalSource Inc. in its consolidated and consolidating financial statements as of such date.

“ Consolidated Tangible Net Worth ”: As of any date of determination, the assets less the liabilities of CapitalSource Inc. and its Consolidated Subsidiaries, the CapitalSource Bank Entities and each Healthcare REIT Consolidated Subsidiary, less intangible assets (including goodwill), less loans or advances to stockholders, directors, officers or employees, all determined in accordance with GAAP; provided, however , that if CapitalSource Inc.’s financial statements as of such date include goodwill created as a result of the CapitalSource Bank Transaction, then all such goodwill in an amount not to exceed $200,000,000 shall be treated as a tangible asset for the purpose of this definition; provided, further, however , that with respect to any Consolidated Subsidiary, CapitalSource Bank Entity or Healthcare REIT Consolidated Subsidiary that all of the shares of Capital Stock are not, directly or indirectly, owned by CapitalSource Inc., then, with respect to any such Person, the Consolidated Tangible Net Worth of such Person shall be calculated by multiplying the Consolidated Tangible Net Worth of such Person by the percentage of the aggregate proceeds that would be distributed to CapitalSource Inc., directly or indirectly, upon the dissolution of such Person.

“ Continuing Directors ”: The directors of CapitalSource Inc. on the Closing Date, and each other director if, in each case, such other director’s nomination for election to the board of directors is recommended by majority of the then Continuing Directors or such other director receives the vote of the Investors in his or her election by the stockholders of CapitalSource Inc.

“ Contractual Obligation ”: With respect to any Person, any provision of any securities issued by such Person or any indenture, mortgage, deed of trust, contract, undertaking, agreement, instrument or other document to which such Person is a party or by which it or any of its property is bound or is subject.

“ Core Transaction Terms ”: Defined in Section 4.3(v) .

“ Corporate Trust Office ”: With respect to Wells Fargo, the office at which any particular time its corporate trust business shall be principally administered, which office at the date of the execution of this Agreement is located at the address set forth under the signature of Wells Fargo on the applicable signature page hereto.

“ CP Rate ”: For any day during any Accrual Period, the per annum rate equivalent to the weighted average of the per annum rates paid or payable by an Issuer from time to time as interest on or otherwise (by means of interest rate hedges or otherwise) in respect of the promissory notes issued by such Issuer that are allocated, in whole or in part, by the Administrative Agent on behalf of such Issuer to fund or maintain the Advances Outstanding funded by such Issuer during such period, as determined by the

Administrative Agent (on such Issuer’s behalf) and reported to the Seller and the Servicer, which rates shall reflect and give effect to (i) the commissions of placement agents and dealers in respect of such promissory notes, to the extent such commissions are allocated, in whole or in part, to such promissory notes by the Administrative Agent (on such Issuer’s behalf) and (ii) other borrowings by such Issuer, including, without limitation, borrowings to fund small or odd dollar amounts that are not easily accommodated in the commercial paper market; provided that if any component of such rate is a discount rate, in calculating the CP Rate, the Administrative Agent shall for such component use the rate resulting from converting such discount rate to an interest bearing equivalent rate per annum .

“ Credit Agreement ”: (i) That certain Credit Agreement, dated as of March 14, 2006, among CapitalSource Inc., the guarantors listed therein, the lenders listed therein, Wachovia Bank, National Association, as administrative agent, swingline lender and issuing lender, Bank of America, N.A., as issuing lender, Wachovia Capital Markets, LLC, as sole bookrunner and lead arranger, and Bank of Montreal, Barclays Bank PLC and SunTrust Bank, as co-documentation agents, as such agreement has been and may in the future be amended, modified or supplemented from time to time, and (ii) any other credit facility entered into by CapitalSource Inc. from time to time following the New Effective Date.

“ Credit Agreement Advances Outstanding ”: Either (i) the meaning set forth for “Advances Outstanding” under the Existing Credit Agreement, or (ii) the analogous term for aggregate principal amounts outstanding under the Credit Agreement.

“ Credit Agreement Mandatory Reduction Amount ”: The sum of the required reductions in the Credit Agreement Advances Outstanding required to paid under Section 2.6(b)(iii) (or analogous provision under an amendment, modification or replacement) of the Credit Agreement and arising pursuant to (a) the application of Section 2.6(b)(i) of the Existing Credit Agreement (or analogous provision under an amendment, modification or replacement of the Credit Agreement providing for mandatory reductions resulting from receipt of cash proceeds), or (b) the application of Section 2.6(b)(ii) of the Existing Credit Agreement (or analogous provision under an amendment, modification or replacement of the Credit Agreement providing for scheduled mandatory reductions of principal); provided that:

     (i) to the extent (x) any amendment, modification, waiver, extension, replacement or other modification to the Existing Credit Agreement results in an increase in any mandatory reduction of principal payable under Section 2.6(b) of the Credit Agreement (or an analogous provision under an amendment, modification or replacement of the Credit Agreement providing for mandatory reductions of principal), or (y) any consensual increased payment is made in excess of the amount of such mandatory reduction under Section 2.6(b), such increased amount shall not be considered a Credit Agreement Mandatory Reduction Amount and shall be considered a Credit Agreement Optional Reduction Amount;

     (ii) to the extent any amendment, modification, waiver, extension, replacement or other modification to the Existing Credit Agreement results in a decrease in any mandatory reduction of principal payable under Section 2.6(b) of the Credit Agreement (or an analogous provision under an amendment, modification or replacement of the Credit Agreement providing for mandatory reductions of principal), only such required amount shall be considered a Credit Agreement Mandatory Reduction Amount and any additional payments of principal shall be considered a Credit Agreement Optional Reduction Amount; and

     (iii) no Credit Agreement Reduction Amount Exempted Amount shall be a Credit Agreement Mandatory Reduction Amount.

“ Credit Agreement Optional Reduction Amount ”: The amount of any reduction in the Credit Agreement Advances Outstanding not classified as a Credit Agreement Mandatory Reduction Amount; provided that no Credit Agreement Reduction Amount Exempted Amount shall be a Credit Agreement Optional Reduction Amount.

“ Credit Agreement Reduction Amount ”: A Credit Agreement Mandatory Reduction Amount or Credit Agreement Optional Reduction Amount.

“ Credit Agreement Reduction Amount Exempted Amount ”: Any reduction in the Credit Agreement Advances Outstanding in the amount required to paid under Section 2.6(b)(i)(1) of the Existing Credit Agreement (or analogous provision under an amendment, modification or replacement of the Credit Agreement providing for scheduled mandatory reductions of principal) determined with reference to the percentage set forth therein; provided that (1) to the extent (x) any amendment, modification, waiver, extension, replacement or other modification to the Existing Credit Agreement results in an increase in such percentage or the mandatory reduction of principal payable under Section 2.6(b)(i)(1) of the Credit Agreement (or an analogous provision under an amendment, modification or replacement of the Credit Agreement providing for mandatory reductions of principal), or (y) any consensual increased payment is made in excess of the amount of such mandatory reduction under Section 2.6(b)(i)(1), such increased amount shall not be considered a Credit Agreement Reduction Amount Exempted Amount and shall be considered a Credit Agreement Optional Reduction Amount, and (2) to the extent any amendment, modification, waiver, extension, replacement or other modification to the Existing Credit Agreement results in a decrease in such percentage or mandatory reduction of principal payable under Section 2.6(b)(i)(1) of the Credit Agreement (or an analogous provision under an amendment, modification or replacement of the Credit Agreement providing for mandatory reductions of principal), only such required amount shall be considered a Credit Agreement Mandatory Reduction Amount Exempted Amount and any additional payments of principal shall be considered a Credit Agreement Optional Reduction Amount.

“ Credit and Collection Policy ”: The written credit policies and procedures manual of the Originator and the Servicer (which policies shall include without limitation policies on a risk rating system, due diligence format, underwriting parameters and credit approval procedures) in the form provided to the Administrative Agent prior to the Closing Date, as it may be amended or supplemented from time to time in accordance with Section 5.1(h) and Section 5.4(f) .

“ CSF LIBOR Rate ”: The Eurodollar or LIBOR rate for 30, 60, 90 or 180 day, as applicable, deposits in Dollars, as and when determined in accordance with the applicable Required Asset Documents.

“ CSF Prime Rate ”: The rate designated by CSF (or the originator of an Acquired Loan) from time to time and/or pursuant to the related Underlying Instruments as its prime rate in the United States, such rate to change as and when the designated rate changes; provided that the CSF Prime Rate is not intended to be the lowest rate of interest charged by CSF (or such originator) in connection with extensions of credit to debtors.

“ CS VII Issuer Financing ”: The transactions evidenced and contemplated by (i) the Indenture dated as of April 19, 2007 (the “ Indenture ”) between CapitalSource Funding VII Trust and Wells Fargo Bank, National Association as Indenture Trustee, and (ii) the Notes issued thereunder (as defined therein).

“ CS VII Issuer Financing SSA ”: the Sale and Servicing Agreement, dated April 19, 2007 among CapitalSource Funding VII Trust, as issuer, CS Funding VII Depositor LLC, as depositor, CSF, as loan originator and servicer and Wells Fargo Bank, National Association, as indenture trustee, collateral custodian and backup servicer, as amended, supplemented, and otherwise modified from time to time.

“ Cut-Off Date ”: With respect to each Existing Asset and Additional Asset, the related Funding Date therefor.

“ Dealer ”: The security alarm dealer who sells one or more security alarm monitoring or security alarm monitoring and maintenance contracts to one or more Persons obligated to pay for the service(s) provided under such contract(s).

“ Deemed Collection ”: Defined in Section 2.4(c) .

“ Delayed-Draw Term Loan ”: A Loan that is fully committed on the closing date thereof and is required by its terms to be fully funded in one or more installments on draw dates to occur within three years after the closing date thereof but which, once fully funded, has the characteristics of a Term Loan.

“ Delinquent Asset ”: An Asset (that is not a Charged-Off Asset) as to which either of the following first occurs: (a) all or any portion of one or more principal or interest payments (other than in respect of default rate interest) remain unpaid for at least 60 days from the original due date for such payment (without giving effect to any Servicer Advance thereon) or (b) consistent with the Credit and Collection Policy such Asset would be classified as delinquent by the Servicer.

“Delinquent Portfolio Asset ”: A Portfolio Asset (that is not a Charged-Off Portfolio Asset) (excluding equity investments) as to which either of the following first occurs: (a) all or any portion of one or more principal or interest payments (other than in respect of default rate interest) remain unpaid for at least 60 days from the original due date for such payment (without giving effect to any Servicer Advance thereon) or (b) consistent with the Credit and Collection Policy (or such similar policies and procedures utilized by the Servicer in servicing such Portfolio Asset) such Portfolio Asset would be classified as delinquent by the Servicer.

“ Derivatives ”: Any exchange-traded or over-the-counter (i) forward, future, option, swap, cap, collar, floor or foreign exchange contract or any combination thereof, whether for physical delivery or cash settlement, relating to any interest rate, interest rate index, currency, currency exchange rate, currency exchange rate index, debt instrument, debt price, debt index, depository instrument, depository price, depository index, equity instrument, equity price, equity index, commodity, commodity price or commodity index, (ii) any similar transaction, contract, instrument, undertaking or security, or (iii) any transaction, contract, instrument, undertaking or security containing any of the foregoing.

“ Determination Date ”: The last day of each Collection Period.

“ DIP Loan ”: A loan to an Obligor that is a “debtor-in-possession” as defined under the Bankruptcy Code.

“ Dollars ”: Means, and the conventional “ $ ” signifies, the lawful currency of the United States.

“ Eligible Asset ”: On any date of determination on or following the New Effective Date, each Asset appearing on the Asset List (A) for which the Administrative Agent, Collateral Custodian and Backup Servicer have received the following no later than 2:00 p.m. (New York City, New York time) on the day prior to the related Funding Date: (1) a faxed copy of the duly executed original promissory note, master purchase agreement and purchase statements, Loan Register and Asset Checklist, as applicable, in a form and substance satisfactory to the Administrative Agent and, with respect to any Loans closed in escrow, a certificate (in the form of Exhibit L ) from the counsel to the Originator or the Obligor of such Loans certifying the possession of the Required Asset Documents; provided that notwithstanding the foregoing, the Required Asset Documents (including any UCCs included in the Required Asset Documents) shall be in the possession of the Collateral Custodian within two Business Days of any related Funding Date as to

any Additional Assets; (2) a Borrowing Notice delivered by the Seller to the Collateral Custodian and the Administrative Agent as part of the Borrowing Notice or Monthly Report delivered by the Servicer, (3) a Borrowing Base Certificate, and (4) a Certificate of Assignment (Exhibit A to the Sale Agreement, including Schedule I thereto); provided that if such Asset is part of a capital contribution to the Seller the Collateral Custodian shall have received the Required Asset Documents within three Business Days of receipt of the Certificate of Assignment and (B) that satisfies each of the following eligibility requirements, as applicable:

(1) With respect to any Asset (other than a 2007-A Eligible Asset):

     (a) the Asset, together with the Related Security, has been originated or acquired by the Originator, sold to the Seller pursuant to (and in accordance with) the Sale Agreement and the Seller has good title, free and clear of all Liens (other than Permitted Liens), on such Asset and Related Security;

     (b) the Asset, (i) (together with the Collections and Related Security related thereto) has been the subject of a grant by the Seller in favor of the Administrative Agent on behalf of the Secured Parties, of a first priority perfected security interest, and (ii) with respect to which, at the time of the sale of such Asset to the Seller, the Originator had a first priority (other than in the case of Senior B-Note Loans or Subordinated Loans) perfected security interest in the Related Property (other than Liens expressly permitted by the Underlying Instruments) relating to such Loan;

     (c) at the time such Asset is included in the Collateral, the Asset (i) is not (and since its origination by the Originator or, in the case of Acquired Loans, acquisition by the Originator has never been) a Charged-Off Asset (either in whole or in part), (ii) is not past due in the case of a Loan, with respect to payments of principal or interest ( provided that if such Asset is past due at the time it is included in the Collateral but not more than ten days past due, the Originator and the Servicer must reasonably believe that such Asset will promptly and in no event later than the date of the next Scheduled Payment due on such Asset, be brought current with respect to all payments due thereunder), and (iii) has never been more than 60 days past due, with respect to payments of principal or interest, or, in the case of Acquired Loans, to the best of the Originator’s knowledge after due inquiry, has never been more than 60 days past due in the 12 months prior to acquisition;

     (d) the Obligors of such Asset that are principally engaged in the origination of mortgage loans to borrowers do not have less than perfect ( i.e. , less than “A”) credit histories, higher debt to income ratios or whose loans that otherwise were underwritten with exceptions to customary “A” quality underwriting guidelines or present other risks,

     (e) the Asset is an “eligible asset” as defined in Rule 3a-7 under the 1940 Act;

     (f) the Asset is an “account”, “chattel paper”, “instrument” or a “general intangible” within the meaning of Article 9 of the UCC of all applicable jurisdictions; provided , however , if the Asset constitutes “tangible chattel paper”, there is not more than one (1) “secured party’s original” counterpart of such chattel paper and the sole manually executed counterpart thereof is in the possession of and has been properly endorsed to the Collateral Custodian;

     (g) the Obligor with respect to such Asset is an Eligible Obligor and such Asset is payable only in Dollars and does not permit the currency in which or the country in which such Asset is payable to be changed;

     (h) the Asset is evidenced by a promissory note, an entry on the Loan Register, security agreement, credit, loan or note purchase agreement or other Underlying Instruments, in each case, that

have been duly authorized and executed, are in full force and effect and constitute the legal, valid, binding and absolute and unconditional payment obligation of the related Obligor, enforceable against such Obligor in accordance with their terms (subject to applicable bankruptcy, insolvency, moratorium or other similar laws affecting the rights of creditors generally and to general principles of equity, whether considered in a suit at law or in equity), and there are no conditions precedent to the enforceability or validity of the Asset that have not been satisfied or validly waived;

     (i) the Asset does not contravene in any material respect any Applicable Laws (including, without limitation all applicable predatory and abusive lending laws and all laws, rules and regulations relating to usury, truth in lending, fair credit billing, fair credit reporting, equal credit opportunity, fair debt collection practices, licensing and privacy) and with respect to which no part thereof is in violation of any Applicable Law in any material respect;

     (j) neither the assignment of the Asset under the Sale Agreement by the Originator, the sale of the Asset hereunder or the granting of a security interest hereunder by the Seller violates, conflicts with or contravenes any Applicable Laws or any contractual or other restriction, limitation or encumbrance;

     (k) on or before the applicable Cut-Off Date, the Obligor of such Asset (or, in the case of Acquired Loans, the applicable agent) shall have been directed to make all payments to the Lock-Box or directly to the Lock-Box Account;

     (l) the Asset requires the Obligor thereof to maintain reasonable and customary property damage and loss insurance with respect to the real or personal property constituting the Related Property (if any) if such Related Property is of a type customarily so insured;

     (m) the Related Property (if any) (i) has not been foreclosed on or repossessed from the current Obligor by the Servicer, and (ii) has not suffered any material loss or damage that has not been repaired or restored or for which insurance proceeds are not available;

     (n) the Asset provides by its terms that the Obligor’s payment obligations are absolute and unconditional without any right of rescission, setoff, counterclaim or defense for any reason against the Originator and the Asset contains a clause that has the effect of unconditionally and irrevocably obligating the Obligor to make periodic payments (including taxes) notwithstanding any damage to, defects in, or destruction of the Related Property (if any) or any other event, including obsolescence of any property or improvements;

     (o) the Asset is not subject to any litigation, dispute, refund, claims of rescission, setoff, netting, counterclaim or defense whatsoever, including but not limited to, claims by or against the Obligor thereof or a payor to or account debtor of such Obligor;

     (p) the Asset requires the Obligor to maintain the Related Property in good condition and to bear all the costs of operating and maintaining same, including taxes and insurance relating thereto;

     (q) the Asset shall not have been originated in, nor shall it be subject to the laws of, any jurisdiction under which the sale, transfer and assignment of such Asset under the Transaction Documents would be unlawful, void or voidable;

     (r) the Asset, together with the Required Asset Documents and Asset File related thereto, is assignable and does not require the consent of or notice to the Obligor to consummate the transactions contemplated by the Transaction Documents or contain any other restriction on the transfer or the assignment of the Asset for the purpose of consummating the transactions contemplated by the

Transaction Documents other than a consent or waiver of such restriction that has been obtained prior to the date on which the Asset was sold to the Seller;

     (s) the Obligor of such Asset is legally responsible for all taxes relating to the Related Security or other security relating to such Asset, and all payments in respect of the Asset are required to be made free and clear of, and without deduction or withholding for or on account of, any taxes, unless such withholding or deduction is required by Applicable Law in which case the Obligor thereof is required to make “gross-up” payments that cover the full amount of any such withholding taxes on an after-tax basis;

     (t) the Asset complies with the representations and warranties made by the Seller and Servicer hereunder and all information provided by the Seller or the Servicer with respect to the Asset is true and correct in all material respects;

     (u) the Asset and the Related Security have not been sold, transferred, assigned or pledged by the Seller to any Person other than as contemplated in the Transaction Documents;

     (v) no selection procedure adverse to the interests of the Administrative Agent or the Secured Parties was utilized by the Seller or Originator in the selection of Assets for inclusion in the Collateral;

     (w) the Asset has not been compromised, adjusted, extended, satisfied, rescinded, set-off or modified by the Seller, the Originator or the Obligor with respect thereto, and no Asset is subject to compromise, adjustment, extension, satisfaction, rescission, set-off, counterclaim, defense, abatement, suspension, deferment, deductible, reduction, termination or modification, whether arising out of transactions concerning the Asset, or otherwise, by the Seller, the Originator or the Obligor with respect thereto except as otherwise permitted under Section 6.4(a) of this Agreement and in accordance with the Credit and Collection Policy;

     (x) the particular Asset is not one as to which the Seller or the Servicer has knowledge which should lead it to expect such Asset will not be paid in full;

     (y) except with respect to DIP Loans, the Obligor of such Asset is not the subject of an Insolvency Event or Insolvency Proceedings and, in the case of a DIP Loan, the Loan Originator or its assignee the Loan Originator or its assignee has been granted a first priority lien status in respect of all or certain of the Obligor’s assets by final order of the applicable federal bankruptcy or district court;

     (z) the Asset is secured by a valid, perfected, first priority (other than with respect to Senior B-Note Loans and Subordinated Loans) security interest in all assets that constitute the collateral for the Asset (subject to Liens expressly permitted by the Underlying Instruments);

     (aa) all material consents, licenses, approvals or authorizations of, or registrations or declarations with, any Governmental Authority required to be obtained, effected or given in connection with the making or performance of the Asset have been duly obtained, effected or given and are in full force and effect;

     (bb) the Asset satisfies all applicable requirements of and was originated or acquired, underwritten and closed in accordance with the Credit and Collection Policy (including without limitation the execution by the Obligor of all documentation required by the Credit and Collection Policy);

     (cc) the Asset was originated or acquired in the ordinary course of the Originator’s business;

     (dd) the Asset arises pursuant to documentation with respect to which the Originator has performed all obligations required to be performed by it thereunder;

     (ee) the Asset is not Margin Stock;

     (ff) the acquisition of the Asset by the Seller will not cause the Seller or the pool of Collateral to be required to be registered as an investment company under the 1940 Act;

     (gg) the Asset is not subject to a guaranty by the Originator or any Affiliate thereof; and

     (hh) the proceeds of the Asset have not and will not be used to finance “ground-up” construction activities.

(2) With respect to any Asset consisting of a Loan (other than a 2007-A Eligible Asset):

     (a) the Loan provides (i) for periodic payments of interest and/or principal in cash, which are due and payable on a monthly, quarterly or semi-annual basis unless otherwise consented to in writing by the Administrative Agent, and (ii) that the Servicer (or, with respect to Acquired Loans or Agented Loans, that the agent or a majority of the related lenders) may accelerate all payments if the Obligor is in default under the Loan and any applicable grace period has expired (in the case of any Subordinated Loan, subject to any applicable intercreditor or subordination agreement);

     (b) the Loan constitutes, and was underwritten as, a Senior Secured Loan or a Subordinated Loan, in each case pursuant to and in accordance with the Credit and Collection Policy;

     (c) each Senior Loan has an original term to maturity of not more than 7 years and each Subordinated Loan has an original term to maturity of not more than 10 years ;

     (d) the Loan provides for cash payments that fully amortize the Outstanding Asset Balance of such Loan on or by its maturity and does not provide for such Outstanding Asset Balance to be discounted pursuant to a prepayment in full;

     (e) the Loan does not permit the Obligor to defer all or any portion of the current cash interest due thereunder;

     (f) the Loan does not permit the payment obligation of the Obligor thereunder to be converted or exchanged for equity capital of such Obligor;

     (g) [Intentionally Omitted];

     (h) except with respect to Subordinated Loans, if the Obligor of such Loan is the Obligor of more than one Loan, all such Loans are cross-collateralized and cross-defaulted;

     (i) the Loan does not represent capitalized interest or payment obligations relating to “put” rights;

     (j) the Loan is not a Loan or extension of credit by the Originator to the Obligor for the purpose of making any past due principal, interest or other payments due on such Loan;

     (k) the Originator (i) has completed to its satisfaction, in accordance with the Credit and Collection Policy, a due diligence audit and collateral assessment with respect to such Loan and (ii) has

done nothing to impair the rights of the Administrative Agent or the Secured Parties with respect to the Loan, the Related Security, the Scheduled Payments or any income or Proceeds therefrom;

     (l) except with respect to Subordinated Loans and Senior B-Note Loans, and to the extent set forth in the definition of those terms, the Loan is not subordinated to any other loan or financing to the related Obligor;

     (m) if the Loan is a Revolving Loan, either it provides by its terms that any future funding thereunder is in the Originator’s sole and absolute discretion or it is subject to the Retained Interest provision of this Agreement;

     (n) the Face Amount of the Loan is the dollar amount thereof shown on the books and records of the Originator and Seller;

     (o) with respect to Subordinated Loans, the Originator has entered into an intercreditor agreement or subordination agreement (or such provisions are contained in the principal Underlying Instruments) with, or provisions for the benefit of, the senior lender, which agreement or provisions are assignable to and have been assigned to the Seller, and which provide that any standstill of remedies by the Originator or its assignee is limited (A) such that no standstill of remedies may be imposed unless (x) a default with respect to the senior obligation has occurred and is continuing and (y) in the case of such a default, other than a payment default, the Originator’s or assignee’s receipt from the senior lender or Obligor of a notice of default by the Obligor under the senior debt, and (B) to no longer than 180 days in duration in the aggregate in any given year;

     (p) with respect to any Acquired Loan and any Excluded Loan, such Loan has been re-underwritten by the Originator and satisfies all of the Originator’s underwriting criteria;

     (q) with respect to any Loan transferred from an Affiliate of the Originator to the Originator, such transfer to the Originator constituted an absolute sale or conveyance (and not a secured loan) and with respect to any such transfer occurring on or after the Closing Date, the Administrative Agent has received a satisfactory legal opinion concerning the acquisition of such Loan by the Originator in a true sale transaction;

     (r) with respect to any Acquired Loan that was acquired in a pool by the Originator along with one or more other Acquired Loans, the Administrative Agent has approved in writing such Loan for inclusion in the Collateral and has completed its own due diligence with respect to such Loan;

     (s) with respect to Agented Loans, the related Underlying Instruments (a) shall include a credit or note purchase or similar agreement containing provisions relating to the appointment and duties of an administrative (or other analogous) agent and intercreditor and (if applicable) subordination provisions, and (b) are duly authorized, fully and properly executed and are the valid, binding and unconditional payment obligation of the Obligor thereof;

     (t) with respect to Agented Loans, CSF or CSE Mortgage LLC (or a wholly owned Subsidiary of CapitalSource Inc.) has been appointed the administrative (or other analogous) agent for all such Loans prior to such Agented Loan becoming a part of the Collateral;

     (u) with respect to Agented Loans, if the entity serving as the collateral agent of the security of the lenders to such Obligor with respect to such Loan has or will change from the time of the origination of the notes, all appropriate assignments of the collateral agent’s rights in and to the collateral on behalf of the lenders have been or will be executed and filed or recorded as appropriate prior to such

Agented Loan becoming a part of the Collateral or if such entity has or will change after such Agented Loan becomes part of the Collateral, then prior to such entity becoming the collateral agent;

     (v) with respect to any Agented Loan, all required notifications, if any, have been given to the collateral agent, the payment agent and any other parties required by the Required Asset Documents of, and all required consents, if any, have been obtained with respect to, the Originator’s assignment of such Agented Loan and the Originator’s right, title and interest in the Related Property to the Seller and the Administrative Agent’s security interest therein on behalf of the Secured Parties;

     (w) with respect to Agented Loans, the right to control the actions of and replace the collateral agent and/or the paying agent of the syndicated loans is to be exercised by at least a majority in interest of all holders of such Agented Loans;

     (x) with respect to Agented Loans, all syndicated loans of the Obligor of the same priority are cross-defaulted, the Related Property securing such loans is held by the collateral agent for the benefit of all holders of the syndicated loans and all holders of such loans (a) have an undivided interest in the collateral securing such loans and (b) share in the proceeds of the sale or other disposition of such collateral on a pro rata basis;

     (y) no portion of the proceeds used to make payments of principal or interest on such Loan have come from a new loan by the Originator;

     (z) the Loan or related Underlying Instruments do not contain a confidentiality provision that restricts or purports to restrict the ability of the Administrative Agent or any Secured Party to exercise their rights under this Agreement, including, without limitation, their rights to review the Loan, the Required Asset Documents and Asset File;

     (aa) the Loan is not a consumer loan;

     (bb) [reserved];

     (cc) none of the Loans secured by a Mortgage are high-cost loans as defined by applicable predatory and abusive-lending laws;

     (dd) with respect to any Acquired Loan for which the value of such Acquired Loan has been determined in accordance with clause (i)(B)(1) or (i)(B)(2) of the definition of “Market Value” set forth in Section 1.1 of this Agreement, on the later of May 9, 2008 and the date such Loan is included in the Collateral, the Market Value of such Acquired Loan is not less than 90% of the outstanding principal balance of such Acquired Loan;

     (ee) at origination or acquisition by the Originator, such Loan was assigned Loan Rating 1, Loan Rating 2 or Loan Rating 3 and, as of any date thereafter, such Loan is assigned Loan Rating 1, Loan Rating 2, Loan Rating 3, Loan Rating 4 or Loan Rating 5;

     (ff) if a Subordinated Loan, such Loan must either (i) have an interest coverage ratio that is not less than 1.25:1, or (ii) be made in respect of construction or development of unimproved land;

     (gg) if a Participation Loan, the Loan meets the criteria set forth in clauses (i) - (iii) of the definition of Participation Loan;

     (hh) the Loan was not a Loan made in connection with (i) the construction or development of unimproved land unless (A) the Outstanding Asset Balance of such Loan together with all other Loans made in respect of construction or development of unimproved land does not exceed ten percent (10%) of the aggregate Outstanding Asset Balance of all Loans and (B) the aggregate Outstanding Asset Balance of such Loan does not exceed Seven Million Five Hundred Thousand Dollars ($7,500,000), or (ii) facilitating the trade-in or exchange of the related Mortgaged Property;

     (ii) no provision of the Loan (other than an Alarm Service Loan) has been waived, modified or altered in any respect, except in accordance with the Credit and Collection Policy and by instruments duly authorized and executed and contained in the Required Loan Documents;

     (jj) after giving effect to the transfer of any Loan hereunder, the weighted average life of the Assets in the aggregate shall not exceed 4.0 years; and

     (kk) after giving effect to such transfer of any Loan hereunder, the Loan Margin shall not be less than 3.00%.

(3) In addition to the criteria set forth in clauses (1) and (2) above, with respect to any Loan that is an Alarm Service Loan, the following additional criteria:

(4) In addition to the criteria set forth in clause (1) above, with respect to any Asset constituting a Rated Retained Security, such Rated Retained Security shall have been approved by the Administrative Agent for inclusion as an Asset.

(5) With respect to an Asset that is a 2007-A Eligible Asset, that such Asset is an “Eligible Asset” within the meaning of that term in the 2007-A Facility.

“ Eligible Assignee ”: Means (i) CNAI or any of its Affiliates, (ii) any Person managed by Citibank, CNAI or any of their Affiliates, or (iii) any financial or other institution acceptable to the Administrative Agent and approved by the Seller (which approval by the Seller shall not be unreasonably withheld, delayed or conditioned and shall not be required if a Termination, Event or an Unmatured Termination Event has occurred and is continuing).

“ Eligible Obligor ”: With respect to Existing Assets and the factual and legal status of the Obligors of such Existing Assets prior to the Closing Date, the meaning assigned to the term “Eligible Obligor” in the CS VII Issuer Financing SSA. With respect to (x) Existing Assets and any changes in factual and legal status since the Closing Date or changes based on newly available information, in each case, that would affect the eligibility of such Eligible Obligor of Existing Assets, and (y) with respect to all other Assets, on any date of determination, any Obligor that:

     (i) is a business organization (and not a natural person) duly organized and validly existing under the laws of its jurisdiction of organization,

     (ii) is a legal operating entity, holding company, or special purpose entity;

     (iii) has not entered into the Loan primarily for personal, family or household purposes,

     (iv) is not a Governmental Authority,

     (v) is not an Affiliate of the Originator or Seller,

     (vi) is not in the gaming (other than Obligors in the business of providing services to the gaming industry), nuclear waste, biotechnology or natural resource exploration/production and oil field service industries,

     (vii) is not engaged in the business of conducting proprietary research on new drug development,

     (viii) except for an Obligor with respect to a DIP Loan, is not the subject of an Insolvency Proceeding, and

     (ix) is not an Obligor of a Charged-Off Asset or Delinquent Asset.

“ Eligible Repurchase Obligations ”: Repurchase obligations with respect to any security that is a direct obligation of, or fully guaranteed by, the United States or any agency or instrumentality thereof the obligations of which are backed by the full faith and credit of the United States, in either case entered into with a depository institution or trust company (acting as principal) described in clauses (c)(ii) and (c)(iv) of the definition of Permitted Investments.

“ Environmental Laws ”: Any and all foreign, federal, state and local laws, statutes, ordinances, rules, regulations, permits, licenses, approvals, interpretations and orders of courts or Governmental Authorities, relating to the protection of human health or the environment, including, but not limited to, requirements pertaining to the manufacture, processing, distribution, use, treatment, storage, disposal, transportation, handling, reporting, licensing, permitting, investigation or remediation of hazardous materials. Environmental Laws include, without limitation, the Comprehensive Environmental Response, Compensation, and Liability Act (42 U.S.C. § 9601 et seq .), the Hazardous Material Transportation Act (49 U.S.C. § 331 et seq .), the Resource Conservation and Recovery Act (42 U.S.C. § 6901 et seq .), the

Federal Water Pollution Control Act (33 U.S.C. § 1251 et seq .), the Clean Air Act (42 U.S.C. § 7401 et seq .), the Toxic Substances Control Act (15 U.S.C. § 2601 et seq .), the Safe Drinking Water Act (42 U.S.C. § 300, et seq .), the Environmental Protection Agency’s regulations relating to underground storage tanks (40 C.F.R. Parts 280 and 281), and the Occupational Safety and Health Act (29 U.S.C. § 651 et seq .), and the rules and regulations thereunder, each as amended or supplemented from time to time.

“ Equity Shortfall ”: As of any date of determination, the positive difference, if any, between (1) the product of (i) the Aggregate Outstanding Asset Balances multiplied by (ii) a percentage equal to 100% minus the Maximum Advance Rate and (2) (i) the Aggregate Outstanding Asset Balances minus (ii) Advances Outstanding.

“ ERISA ”: The United States Employee Retirement Income Security Act of 1974, as amended from time to time, and the regulations promulgated and rulings issued thereunder.

“ ERISA Affiliate ”: (a) Any corporation that is a member of the same controlled group of corporations (within the meaning of Section 414(b) of the Code) as the Seller, (b) a trade or business (whether or not incorporated) under common control (within the meaning of Section 414(c) of the Code) with the Seller, or (c) a member of the same affiliated service group (within the meaning of Section 414(m) of the Code) as the Seller, any corporation described in clause (a) above or any trade or business described in clause (b) above.

“ Eurocurrency Liabilities ”: Defined in Regulation D of the Board of Governors of the Federal Reserve System, as in effect from time to time.

“ Eurodollar Disruption Event ”: The occurrence of any of the following: (a) any Liquidity Bank shall have notified the Administrative Agent of a determination by such Liquidity Bank or any of its assignees or participants that it would be contrary to law or to the directive of any central bank or other governmental authority (whether or not having the force of law) to obtain Dollars in the London interbank market to fund any Advance, (b) any Liquidity Bank shall have notified the Administrative Agent of the inability, for any reason, of such Liquidity Bank or any of its assignees or participants to determine the Adjusted Eurodollar Rate, (c) any Liquidity Bank shall have notified the Administrative Agent of a determination by such Liquidity Bank or any of its assignees or participants that the rate at which deposits of Dollars are being offered to such Liquidity Bank or any of its assignees or participants in the London interbank market does not accurately reflect the cost to such Liquidity Bank, such assignee or such participant of making, funding or maintaining any Advance, (d) any Liquidity Bank shall have notified the Administrative Agent of the inability of such Liquidity Bank or any of its assignees or participants to obtain Dollars in the London interbank market to make, fund or maintain any Advance or (e) any Liquidity Bank shall have notified the Administrative Agent that the principal amount of Advances to be funded by it is less than $500,000.

“ Eurodollar Reserve Percentage ”: For any period means the percentage, if any, applicable during such period (or, if more than one such percentage shall be so applicable, the daily average of such percentages for those days in such period during which any such percentage shall be so applicable) under regulations issued from time to time by the Board of Governors of the Federal Reserve System (or any successor) for determining the maximum reserve requirement (including, without limitation, any basic, emergency, supplemental, marginal or other reserve requirements) with respect to liabilities or assets consisting of or including Eurocurrency Liabilities having a term of one month.

“ Excepted Person ”: Defined in Section 13.13(a) .

“ Exchange Act ”: The United States Securities Exchange Act of 1934, as amended.

“ Excluded Amounts ”: (a) Any amount received in the Lock-Box by, on or with respect to any Asset included as part of the Collateral, which amount is attributable to the payment of any tax, fee or other charge imposed by any Governmental Authority on such Asset, (b) any amount representing a reimbursement of insurance premiums and (c) any amount with respect to any Asset retransferred or substituted for upon the occurrence of a Warranty Event (if the Seller has decided that such Asset is no longer to be included in the Collateral) or that is otherwise replaced by a Substitute Asset (if the Seller has decided that such Asset is no longer to be included in the Collateral), to the extent such amount is attributable to a time after the effective date of such replacement.

“ Excluded Loan ”: A Loan listed on Schedule IX (i) that was originated, acquired or extended by the Originator, CapitalSource Inc. or any of their respective Subsidiaries prior to May 1, 2007, (ii) under which the Originator, CapitalSource Inc. or any of their respective Subsidiaries is acting as administrative (or other analogous) agent and a lender thereunder, or (iii) for which the documentation governing such Loan has been amended and restated based upon the form documentation utilized by the Originator and CapitalSource Inc. The Seller and the Servicer shall update Schedule IX , when necessary, on each Funding Date.

“ Existing Assets ”: Each Asset purchased by the Seller under the Sale Agreement and owned by the Seller on the Closing Date.

“ Existing Credit Agreement ”: The Credit Agreement as in existence on the New Effective Date.

“ Existing Loan Balances ”: The Outstanding Asset Balances excluding New Loan Balances.

“ Face Amount ”: With respect to any Asset, the Outstanding Asset Balance thereof, in each case as shown on the applicable Asset List.

“ Facility Amount ”: The aggregate Commitments then in effect; provided that such amount may not at any time exceed (i) $185,000,000 plus (ii) the Additional Commitment Amount minus (iii) the sum of (x) all Term Loan Reduction Amounts, plus (y) all Special Reduction Amounts, without the written agreement of the parties hereto; provided further that, on or after the Termination Date, the Facility Amount shall mean the Advances Outstanding.

“ FDIC ”: The Federal Deposit Insurance Corporation, and any successor thereto.

“ Federal Funds Rate ”: For any period, a fluctuating interest rate per annum equal for each day during such period to the weighted average of the overnight federal funds rates as in Federal Reserve Board Statistical Release H.15(519) or any successor or substitute publication selected by the Administrative Agent (or, if such day is not a Business Day, for the next preceding Business Day), or, if, for any reason, such rate is not available on any day, the rate determined, in the sole opinion of the Administrative Agent, to be the rate at which overnight federal funds are being offered in the national federal funds market at 9:00 a.m. (New York City, New York time).

“ Final Maturity Date ”: The Termination Date.

“ Finance Charges ”: With respect to any Asset, any interest or finance charges owing by an Obligor pursuant to or with respect to such Asset.

“ Financial Sponsor ”: Any Person, including any Subsidiary of another Person, whose principal business activity is acquiring, holding, and selling investments (including controlling interests) in otherwise unrelated companies that each are distinct legal entities with separate management, books and records and

bank accounts, whose operations are not integrated one with another and whose financial condition and creditworthiness are independent of the other companies so owned by such Person.

“ Fitch ”: Fitch, Inc. or any successor thereto.

“ Fixed Rate Asset ”: A Loan that is an Eligible Asset other than a Floating Rate Asset.

“ Fixed Rate Asset Percentage ”: As of any date of determination, the percentage equivalent of a fraction (a) the numerator of which is equal to the sum of the Outstanding Asset Balances of all Fixed Rate Assets and Banded Floating Rate Loans that are within 0.50% of the maximum interest rate allowable under their Required Asset Documents as of such date, and (b) the denominator of which is equal to the Aggregate Outstanding Asset Balance as of such date.

“ Floating Rate Asset ”: A Loan that is an Eligible Asset where the interest rate payable by the Obligor thereof is based on the CSF Prime Rate or CSF LIBOR Rate, plus some specified interest percentage in addition thereto, and the Loan provides that such interest rate will reset immediately upon any change in the related CSF Prime Rate or CSF LIBOR Rate.

“ Funding Date ”: With respect to the initial Funding Date, the Closing Date, and as to any incremental Advance, any Business Day that is one Business Day immediately following the receipt by the Administrative Agent of a Borrowing Notice (along with a Borrowing Base Certificate) in accordance with Section 2.3 .

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

“ Governmental Authority ”: With respect to any Person, any nation or government, any state or other political subdivision thereof, any central bank (or similar monetary or regulatory authority) thereof, any body or entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government and any court or arbitrator having jurisdiction over such Person.

“ H.15 ”: Federal Reserve Statistical Release H.15.

“ Healthcare REIT Consolidated Subsidiary ”: The “Healthcare REIT Consolidated Subsidiary” under and as defined in the Credit Agreement.

“ Hedge Amount ”: On any day, an amount equal to the product of (a) the Borrowing Base and (b) the Fixed Rate Asset Percentage on such day.

“ Hedge Collateral ”: Defined in Section 5.3(b) .

“ Hedge Breakage Costs ”: For any Hedge Transaction, any amount payable by the Seller for the early termination of that Hedge Transaction or any portion thereof.

“ Hedge Counterparty ”: At any date of determination, a Permitted Hedge Counterparty which has entered into a Hedging Agreement that remains in effect and has not been terminated on such date of determination.

“ Hedge Guaranty ”: Any guaranty agreement supporting the obligations of a Hedge Counterparty under its Hedge Agreement, as the same may be in effect from time to time.

“ Hedge Notional Amount ”: For any Advance, the aggregate notional amount in effect on any day under all Hedge Transactions entered into pursuant to Section 5.3(a) for that Advance.

“ Hedge Percentage ”: With respect to:

     (a) Fixed Rate Assets is, on any day that (i) the Aggregate Outstanding Asset Balance exceeds $150,000,000, an amount equal to 100% if the sum of the Outstanding Asset Balances of all Fixed Rate Assets exceeds $50,000,000, (ii) the Aggregate Outstanding Asset Balance exceeds $150,000,000, an amount equal to 0% if the sum of the Outstanding Asset Balances of all Fixed Rate Assets is less than or equal to $50,000,000, (iii) the Aggregate Outstanding Asset Balance is less than or equal to $150,000,000, an amount equal to 100% if the sum of the Outstanding Asset Balances of all Fixed Rate Assets exceeds $20,000,000 or (iv) the Aggregate Outstanding Asset Balance is less than or equal to $150,000,000, an amount equal to 0% if the sum of the Outstanding Asset Balances of all Fixed Rate Assets is less than or equal to $20,000,000;

     (b) Floating Rate Assets is 0%;

     (c) Banded Floating Rate Loans that are within 0.50% of the maximum interest rate allowable under their Required Asset Documents, on any day, is an amount equal to 100%.

“ Hedge Transaction ”: Each interest rate or index rate swap transaction between the Seller and a Hedge Counterparty that is entered into pursuant to Section 5.3(a) and is governed by a Hedging Agreement.

“ Hedged Rate ”: For any Advance, the interest rate payable to a Hedge Counterparty under the Hedge Transaction related to such Advance computed as of the Cut-Off Date under or with respect to the Asset to which that Advance relates.

“ Hedging Agreement ”: Each agreement between the Seller and a Hedge Counterparty that governs one or more Hedge Transactions entered into pursuant to Section 5.3(a) , which agreement shall consist of a “Master Agreement” in a form published by the International Swaps and Derivatives Association, Inc., together with a “Schedule” thereto substantially in such form as the Administrative Agent shall approve in writing, detailing the specific terms of each such Hedge Transaction.

“ Highest Required Investment Category ”: (i) With respect to ratings assigned by Moody’s, “Aa2” or “P-1” for one month instruments, “Aa2” and “P-1” for three month instruments, “Aa3” and “P-1” for six month instruments and “Aa2” and “P-1” for instruments with a term in excess of six months, (ii) with respect to rating assigned by S&P, “A-1” for short-term instruments and “A” for long-term instruments, and (iii) with respect to rating assigned by Fitch (if such investment is rated by Fitch), “F-1+” for short-term instruments and “AAA” for long-term instruments.

“ Increased Costs ”: Any amounts required to be paid by the Seller to an Affected Party pursuant to Section 2.15 .

“ Indebtedness ”: With respect to any Person at any date, (a) all indebtedness of such Person for borrowed money or for the deferred purchase price of property or services (other than current liabilities incurred in the ordinary course of business and payable in accordance with customary trade practices) or that is evidenced by a note, bond, debenture or similar instrument or other evidence of indebtedness customary for indebtedness of that type, (b) all obligations of such Person under leases that shall have been or should be, in accordance with generally accepted accounting principles, recorded as capital leases, (c) all obligations of such Person in respect of acceptances issued or created for the account of such Person, (d) all liabilities secured by any Lien on any property owned by such Person even though such Person has

not assumed or otherwise become liable for the payment thereof, (e) all indebtedness, obligations or liabilities of that Person in respect of Derivatives, and (f) obligations under direct or indirect guaranties in respect of obligations (contingent or otherwise) to purchase or otherwise acquire, or to otherwise assure a creditor against loss in respect of, indebtedness or obligations of others of the kind referred to in clauses (a) through (e) above.

“ Indemnified Amounts ”: Defined in Section 11.1 .

“ Indemnified Parties ”: Defined in Section 11.1 .

“ Indenture ”: Defined in the definition of CS VII Issuer Financing.

“ Independent ”: As to any Person, any other Person (including, in the case of an accountant, a firm of accountants and any member thereof and in the case of an investment banker, an investment bank and any officer thereof) who (i) does not have and is not committed to acquire any material direct or any material indirect financial interest in such Person or in any Affiliate of such Person and (ii) is not connected with such Person as an officer, employee, promoter, underwriter, voting trustee, partner, director or Person performing similar. “Independent” when used with respect to any accountant may include an accountant who audits the books of such Person if in addition to satisfying the criteria set forth above the accountant is independent with respect to such Person within the meaning of Rule 101 of the Code of Professional Conduct of the American Institute of Certified Public Accountants.

“ Independent Director ”: Defined in Section 4.1(u) .

“ Industry ”: The industry of an Obligor as determined by reference to the two digit standard industry classification or North American Industry Classification System codes.

“ Initial Advance ”: The first Advance.

“ Initial Credit Agreement Mandatory Reduction Amount ”: The Credit Agreement Mandatory Reduction Amount and any other amounts paid to existing lenders with respect to principal amounts then owing, arising either (i) in connection with the initial renewal and extension of the Credit Agreement following the New Effective Date, or (ii) pursuant to the terms of the Credit Agreement in effect as a result of execution of the initial renewal and extension of the Credit Agreement following the New Effective Date (but not pursuant to any subsequent renewal or extension of the Credit Agreement following such initial renewal and extension of the Credit Agreement).

“ Insolvency Event ”: With respect to a specified Person, (a) the filing of a decree or order for relief by a court having jurisdiction in the premises in respect of such Person or any substantial part of its property in an involuntary case under any applicable Insolvency Law now or hereafter in effect, or appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official for such Person or for any substantial part of its property, or ordering the winding-up or liquidation of such Person’s affairs, and such decree or order shall remain unstayed and in effect for a period of 60 consecutive days; or (b) the commencement by such Person of a voluntary case under any applicable Insolvency Law now or hereafter in effect, or the consent by such Person to the entry of an order for relief in an involuntary case under any such law, or the consent by such Person to the appointment of or taking possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official for such Person or for any substantial part of its property, or the making by such Person of any general assignment for the benefit of creditors, or the failure by such Person generally to pay its debts as such debts become due, or the taking of action by such Person in furtherance of any of the foregoing.

“ Insolvency Laws ”: The Bankruptcy Code and all other applicable liquidation, conservatorship, bankruptcy, moratorium, rearrangement, receivership, insolvency, reorganization, suspension of payments, or similar debtor relief laws from time to time in effect affecting the rights of creditors generally.

“ Insolvency Proceeding ”: Any case, action or proceeding before any court or other Governmental Authority relating to any Insolvency Event.

“ Instrument ”: Any “instrument” (as defined in Article 9 of the UCC), other than an instrument that constitutes part of chattel paper.

“ Insurance Policy ”: With respect to any Asset an insurance policy covering liability and physical damage to or loss of the Related Property.

“ Insurance Proceeds ”: Any amounts payable or any payments made on or with respect to an Asset under any Insurance Policy.

“ Intercreditor Agreement ”: The Fourth Amended and Restated Intercreditor and Lockbox Administration Agreement, dated as of June 30, 2005, by and among each of the financing agents from time to time party thereto, Bank of America, N.A., as the lockbox bank, CSF, as the originator, as the original servicer and as the lockbox servicer, and CapitalSource Funding LLC, as the owner of the account and as the owner of the lockbox, as amended, modified, waived, supplemented, restated or replaced from time to time.

“ Interest ”: For each Accrual Period and each Advance outstanding, the sum of the products of:

          where:

provided that (i) no provision of this Agreement shall require the payment or permit the collection of Interest in excess of the maximum permitted by Applicable Law and (ii) Interest shall not be considered paid by any distribution if at any time such distribution is rescinded or must otherwise be returned for any reason.

“ Interest Collections ”: Any and all amounts received in respect of any interest, fees or other similar charges (including any Finance Charges) from or on behalf of any Obligor that are deposited into the Collection Account, or received by or on behalf of the Seller by the Servicer or Originator in respect of an Asset, in the form of cash, checks, wire transfers, electronic transfers or any other form of cash payment (net of any payment owed by the Seller to, and including any receipts from, any Hedge Counterparties).

“ Interests in Real Property ”: A fee simple interest, a financeable estate for years or a leasehold interest, in each case in real property.

“ Interest Rate ”: For any Accrual Period and for each Advance outstanding for each day during such Accrual Period:

     (i) to the extent the applicable Purchaser is an Issuer that has funded the applicable Advance through the issuance of commercial paper or other senior notes, a rate equal to the applicable CP Rate; or

     (ii) to the extent the applicable Purchaser is (x) an Issuer that did not fund the applicable Advance through the issuance of commercial paper or other senior notes, or (y) is a Liquidity Bank, a rate equal to the Alternative Rate;

provided that the Interest Rate shall be the Base Rate for any Accrual Period for any Advance as to which a Purchaser has funded the making or maintenance thereof without having received at least two Business Days’ prior written notice thereof (including, without limitation, by reason of a sale of an interest therein to any Liquidity Bank under the applicable Liquidity Agreement).

“ Investment Loan ”: An “Investment Loan” under and as defined in the Credit Agreement.

“ Investors ”: The Persons listed on Schedule VI attached hereto.

“ ISDA Definitions ”: The 2000 ISDA Definitions as published by the International Swaps and Derivatives Association, Inc.

“ Issuer ”: CHARTA, CAFCO and any other any Person that becomes an owner of Advances, by assignment or otherwise, and whose principal business consists of issuing commercial paper or other securities to fund its acquisition or maintenance of receivables, accounts, instruments, chattel paper, general intangibles and other similar assets.

“ Issuer Purchase Limit ”: With respect to each Issuer, the lesser of (1) (i) $185,000,000 plus (ii) the Additional Commitment Amount minus (iii) the sum of (x) all Term Loan Reduction Amounts, plus (y) all Special Reduction Amounts, and (2) the Facility Amount in effect from time to time.

“ LIBOR Rate ”: For any day during any Accrual Period and any Advance or portion thereof, an interest rate per annum equal to the rate per annum at which deposits in Dollars are offered by the principal office of Citibank in London, England to prime banks in the London interbank market at 11:00 A.M. (London time) two (2) Business Days preceding the applicable Funding Date (with respect to the initial Accrual Period for such Advance) and as of the second Business Day immediately preceding the first day of the applicable Accrual Period (with respect to all subsequent Accrual Periods for such Advance).

“ Lien ”: Any mortgage, lien, pledge, charge, right, claim, security interest or encumbrance of any kind of or on any Person’s assets or properties in favor of any other Person (including any UCC financing statement or any similar instrument filed against such Person’s assets or properties).

“ Liquid Real Estate Assets ”: The “Liquid Real Estate Assets” under and as defined in the Credit Agreement.

“ Liquidation Expenses ”: With respect to (a) any Asset, the aggregate amount of all out-of-pocket expenses reasonably incurred by the Servicer (including amounts paid to any subservicer) and any reasonably allocated costs of counsel (if any), in each case in accordance with the Servicer’s customary procedures in connection with the repossession, refurbishing and disposition of any related assets securing such Asset upon or after the expiration or earlier termination of such Asset and other out-of-pocket costs related to the liquidation of any such assets, including the attempted collection of any amount owing pursuant to such Asset if it is a Charged-Off Asset, and if requested by the Administrative Agent, the Servicer and Originator must provide to the Administrative Agent a breakdown of the Liquidation

Expenses for any Asset along with any supporting documentation therefor, and (b) any Portfolio Asset, the aggregate amount of all out-of-pocket expenses reasonably incurred by the Servicer (including amounts paid to any subservicer) and any reasonably allocated costs of counsel (if any), in each case in accordance with the Servicer’s customary procedures in connection with the repossession, refurbishing and disposition of any related assets securing such Portfolio Asset upon or after the expiration or earlier termination of such Portfolio Asset and other out-of-pocket costs related to the liquidation of any such assets, including the attempted collection of any amount owing pursuant to such Portfolio Asset if it is a Charged-Off Portfolio Asset, and if requested by the Administrative Agent, the Servicer and Originator must provide to the Administrative Agent a breakdown of the Liquidation Expenses for any Portfolio Asset along with any supporting documentation therefor.

“ Liquidity Agreement ”: With respect to each Purchaser that is an Issuer, the asset purchase agreement, secondary market agreement or other liquidity agreement, by and among such Purchaser, the Liquidity Banks named therein, and the Administrative Agent, as such agreement may be amended, modified, waived, supplemented, restated or replaced from time to time.

“ Liquidity Bank ”: Citibank and each other Person or Persons who provide liquidity support to any Purchaser which is an Issuer pursuant to a Liquidity Agreement in connection with the issuance by such Issuer of Commercial Paper Notes.

“ Liquidity Factor Reduction Event ”: With respect to each Asset included as part of the Collateral subject to the Retained Interest provisions of this Agreement, a “Liquidity Factor Reduction Event” under and as defined in any Permitted Securitization Transaction rated by the Rating Agencies.

“ Loan ”: Any loan originated by the Originator or CSE Mortgage LLC or, in the case of an Acquired Loan, otherwise acquired by the Originator, that is identified on an Asset List and sold or contributed to the Seller hereunder and included as part of the Collateral, which loan includes, without limitation, (i) the Required Asset Documents and Asset File, and (ii) all right, title and interest of the Originator in and to the loan and any Related Property.

“ Loan Interest Rate ”: With respect to each Eligible Asset, the annual rate of interest borne by the related Underlying Instrument, as shown on the Asset List, and, in the case of an adjustable rate Loan, as the same may be periodically adjusted in accordance with the terms thereof.

“ Loan Margin ”: With respect to all Eligible Assets and for any date of determination, the positive difference between (x) the weighted average Loan Interest Rate of such Eligible Assets based on the unpaid principal balance of such Eligible Assets and (y) the then-current value of the LIBOR Rate.

“ Loan Rating ”: Shall mean either Loan Rating 1, Loan Rating 2, Loan Rating 3, Loan Rating 4, Loan Rating 5 or Loan Rating 6, as applicable.

“ Loan Rating 1 ”: Shall mean a rating of 1 pursuant to the Credit and Collection Policy of the Originator.

“ Loan Rating 2 ”: Shall mean a rating of 2 pursuant to the Credit and Collection Policy of the Originator.

“ Loan Rating 3 ”: Shall mean a rating of 3 pursuant to the Credit and Collection Policy of the Originator.

“ Loan Rating 4 ”: Shall mean a rating of 4 pursuant to the Credit and Collection Policy of the Originator.

“ Loan Rating 5 ”: Shall mean a rating of 5 pursuant to the Credit and Collection Policy of the Originator.

“ Loan Rating 6 ”: Shall mean a rating of 6 pursuant to the Credit and Collection Policy of the Originator.

“ Loan Register ”: Defined in Section 5.4(n) .

“ Loan Threshold Amount ”: With respect to each Eligible Asset that is a Loan, the Outstanding Asset Balance of such Loan as of the New Effective Date as set forth on Schedule V .

“ Loan-to-Liquidation Value ” or “ LLV ”: With respect to any Loan, as of the date of its origination, the percentage equivalent of a fraction (i) the numerator of which is equal to the maximum availability (as provided in the applicable Underlying Instruments) of such Loan as of the date of its origination and (ii) the denominator of which is equal to the liquidation value of the Related Property securing such Loan that is subject to a first priority lien in favor of the Originator (as determined by the Servicer in accordance with the Credit and Collection Policy and in a commercially reasonable manner).

“ Loan-to-Value Ratio ” or “ LTV ”: With respect to any Loan, as of the date of its origination, the percentage equivalent of a fraction (a) the numerator of which is equal to the total commitment amount of such Loan as of the date of its origination (as provided in the related Underlying Instruments) (or the Outstanding Asset Balance with respect to Delayed-Draw Term Loans as determined on the last day of each calendar month) plus the total commitment amount or principal amount, as the case may be, as of the applicable date of origination or incurrence, of all loans and other indebtedness that is senior to or pari passu with such Loan in the “capital structure” of the related Obligor (as defined in, and as determined by the Servicer in accordance with, the Credit and Collection Policy and in a commercially reasonable manner), and (b) the denominator of which is equal to the lower of the Obligor’s cost to acquire the Related Property or the current value (determined by means of an Appraisal) of the Related Property.

“ Lock-Box ”: The post office box to which Collections are remitted for retrieval by a Lock-Box Bank and deposited by such Lock-Box Bank into a Lock-Box Account, the details of which are contained in Schedule II .

“ Lock-Box Account ”: The account maintained at the Lock-Box Bank for the purpose of receiving Collections, the details of which are contained in Schedule II , as such schedule may be amended from time to time.

“ Lock-Box Agreement ”: The Fifth Amended and Restated Three Party Agreement Relating to Lockbox Services and Control (with Activation Upon Notice), dated as of June 30, 2005, by and among certain financing agents party thereto, Bank of America, N.A., as the lockbox bank, CSF, as the originator, as the original servicer and as the lockbox servicer, and CapitalSource Funding LLC, as the owner of the account and as the owner of the lockbox, as amended, modified, waived, supplemented, restated or replaced from time to time.

“ Lock-Box Bank ”: Bank of America, N.A., or any of the banks or other financial institutions holding one or more Lock-Box Accounts.

“ Margin Stock ”: Margin Stock as defined under Regulation U.

“ Market Value ”: With respect to any Acquired Loan or Excluded Loan and any Asset Valuation Date an amount determined by the Servicer (or, at any time that the Backup Servicer is acting as Servicer, by the Administrative Agent or its designee), in the exercise of its reasonable discretion, equal to:

(i) with respect to an Acquired Loan, the lesser of : (A) the outstanding principal balance of such Acquired Loan and (B) the value determined in accordance with the following, in the following order of priority:

     (1) the price quoted for such Acquired Loan by an Approved Pricing Service as of such Asset Valuation Date;

     (2) if the Servicer reasonably determines that it is unable to obtain a quote from an Approved Pricing Service (or the Servicer otherwise reasonably determines that clause (1) of this definition is inapplicable), the arithmetic mean of three bona fide firm bid-side quotations (or, if the Servicer reasonably determines that it is unable to obtain three such bids, then two bids) from Approved Dealers (as of the Asset Valuation Date or as of such other proximate date as may be approved by the Administrative Agent in its sole discretion) for an aggregate principal amount of such Acquired Loan in an amount not less than (i) the outstanding principal balance of the applicable Acquired Loan or (ii) such lesser amount as the Servicer may determine in its sole discretion; provided , that if the Servicer is unable to obtain at least two such bids, it shall promptly so inform the Administrative Agent, and the Administrative Agent may either (x) itself obtain two such bids from Approved Dealers (in which case the arithmetic mean of such bids shall be used for determining the value pursuant to this clause (2) ) or (y) require that the determination of the value be made pursuant to clause (3) below; and

     (3) the lesser of (i) the purchase price paid by the Originator, CapitalSource Inc. or their respective Subsidiaries to an unaffiliated third party for such Acquired Loan or (ii) the value of such Acquired Loan on the books of the Seller as such may have been reduced in accordance with the Credit and Collection Policy, which value shall be further subject to adjustment in the Administrative Agent’s discretion; provided that the Servicer shall determine and report the amount of any such reduction on each Asset Valuation Date.

and (ii) with respect to an Excluded Loan, the lesser of : (A) the outstanding principal balance of such Excluded Loan and (B) the lesser of (x) the purchase price paid by the Originator, CapitalSource Inc. or their respective Subsidiaries to an unaffiliated third party for such Excluded Loan or the par value at origination or extension, as applicable, or (y) the value of such Excluded Loan on the books of the Seller as such may have been reduced in accordance with the Credit and Collection Policy.

“ Material Adverse Effect ”: With respect to any event or circumstance, means a material adverse effect on (a) the business, condition (financial or otherwise), operations, performance, properties or prospects of the Servicer or the Seller, (b) the validity, enforceability or collectibility of this Agreement or any other Transaction Document or the validity, enforceability or collectibility of the Assets generally or any material portion of the Assets, (c) the rights and remedies of the Administrative Agent, the Purchasers and the Secured Parties under the Transaction Documents, (d) the ability of the Seller, the Servicer, the Backup Servicer or the Collateral Custodian to perform its obligations under this Agreement or any Transaction Document, or (e) the status, existence, perfection, priority or enforceability of the Administrative Agent’s or the Secured Parties’ interest in the Collateral.

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

“ Maximum Advance Rate ” as of any Determination Date, equals 70%.

“ Maximum Availability ”: On any date of determination an amount equal to the least of:

     (a) the Facility Amount;

     (b) the sum of (I) the least of (1) the product of the Borrowing Base and the Weighted Average Advance Rate on such date plus the amounts on deposit in the Principal Collections Account, and (2) an amount equal to (i) the Existing Loan Balances, minus (ii) the Minimum Equity Amount plus the amounts on deposit in the Principal Collections Account, and (II) the product of the New Loan Balances and the New Loan Advance Rate; and

     (c) an amount equal to (i) the Borrowing Base plus the New Loan Balances minus (ii) the Minimum Overcollateralization Amount plus (iii) the amount on deposit in the Principal Collections Account.

“ Memorandum of Understanding ”: That certain Memorandum of Understanding, dated as of the New Effective Date, among the Originator, CapitalSource Finance II LLC and the New Parent, in substantially the form attached hereto as Exhibit 09-F , as such agreement may be amended, modified or supplemented from time to time in accordance with its terms.

“ Minimum Equity Amount ”: As of any date of determination, an amount equal to the product of (i) the Existing Loan Balances multiplied by (ii) a percentage equal to 100% minus the Maximum Advance Rate.

“ Minimum Overcollateralization Amount ”: As of any date of determination, an amount equal to the sum of the Outstanding Asset Balances of all Eligible Assets attributable to the three Obligors having the largest aggregate Outstanding Asset Balance of Eligible Assets included as part of the Collateral (excluding solely during the Revolving Period, the amount, calculated without duplication, by which such Eligible Assets exceed any applicable Pool Concentration Criteria).

“ Minimum Pool Yield ”: A Pool Yield equal to 0.75%.

“ Monthly Report ”: Defined in Section 6.10(b) .

“ Moody’s ”: Moody’s Investors Service, Inc., and any successor thereto.

“ Mortgage ”: The mortgage, deed of trust or other instrument creating a first or second Lien on an Interest in Real Property securing a Loan subject to this Agreement, including the Assignment of Leases and Rents related thereto.

“ Mortgaged Property ”: The underlying Interests in Real Property which are subject to the Lien of a Mortgage that secures a Loan, consisting of Interests in Real Property in a parcel or parcels of land, at least one of which parcels is improved by a commercial building or facility, together with Interests in Real Property in such commercial building or facility and any personal property, fixtures, leases and other property or rights pertaining to such land, commercial building or facility which are subject to the related Mortgage.

“ Multiemployer Plan ”: A “multiemployer plan” as defined in Section 4001(a)(3) of ERISA that is or was at any time during the current year or the immediately preceding five years contributed to by the Seller or any ERISA Affiliate on behalf of its employees.

“ NAICS Code ”: the North American Industry Classification System Codes by at least four digits.

“ Net Proceeds of Capital Stock/Conversion of Debt ”: Any and all proceeds (whether cash or non-cash) or other consideration received by CapitalSource Inc. and its Consolidated Subsidiaries, on a consolidated basis, in respect of the issuance of Capital Stock (including, without limitation, the aggregate amount of any and all Indebtedness converted into Capital Stock), after deducting therefrom all reasonable and customary costs and expenses incurred by CapitalSource Inc. and such Consolidated Subsidiary in connection with the issuance of such Capital Stock in each case to the extent classified as equity on the consolidated balance sheet of CapitalSource Inc. and its Consolidated Subsidiaries.

“ New Advances ”: Advances made on and after the New Effective Date in an amount equal to the excess over the related Loan’s Loan Threshold Amount, if any.

“ New Effective Date ”: April 20, 2009, being the date that the conditions precedent set forth in Section 3.3 have been fulfilled to the satisfaction of the Administrative Agent.

“ New Loan Balances ”: The Outstanding Asset Balances with respect to all New Advances.

“ New Loan Advance Rate ”: The weighted average of the Advance Rates with respect to New Advances applicable to the Eligible Assets included in the Collateral on such day, weighted according to the proportion of the Aggregate Outstanding Asset Balance each type of Asset with respect to New Loan Balances represents; provided that the New Loan Advance Rate shall in no event exceed 50%.

“ New Parent ”: CS Funding IX Depositor LLC, Delaware limited liability company, together with its successors and assigns.

“ Noteless Loan ”: A Loan with respect to which the Underlying Instruments do not require the Obligor to execute and deliver a promissory note to evidence the indebtedness created under such Loan.

“ Obligor ”: With respect to any Asset, as applicable, any Person or Persons obligated to make payments pursuant to or with respect to such Asset, including any guarantor thereof. For purposes of calculating any of the Pool Concentration Criteria only, all Assets included as part of the Collateral or to be transferred so as to become part of the Collateral, the Obligor of which is an Affiliate of another Obligor (excluding any Financial Sponsor or Obligors that are Affiliates solely because of common ownership or control by a Financial Sponsor) shall be aggregated with all Assets of such other Obligor; for example , if Corporation A is an Affiliate (other than because of a common Financial Sponsor) of Corporation B, and the sum of the Outstanding Asset Balances of all of Corporation A’s Loans included as part of the Collateral constitutes 10% of the Aggregate Outstanding Asset Balance and the sum of the Outstanding Asset Balances all of Corporation B’s Loans included as part of the Collateral constitutes 10% of the Aggregate Outstanding Asset Balance, the combined Obligor concentration for Corporation A and Corporation B would be 20%.

“ Officer’s Certificate ”: A certificate signed by a Responsible Officer of the Seller or the Servicer, as the case may be, and delivered to the Collateral Custodian.

“ Omnibus Payoff and Restructuring Agreement ”: That certain Omnibus Payoff and Restructuring Agreement dated as of the Closing Date among CSF, CS Funding VII Depositor LLC, CapitalSource Funding VII Trust, Wells Fargo Bank, National Association, Citicorp North America, Inc, Citigroup Global Markets Realty Corp, and each other party thereto.

“ Opinion of Counsel ”: A written opinion of counsel, which opinion and counsel are acceptable to the Administrative Agent in its sole discretion.

“ Optional Sale ”: Defined in Section 2.19 .

“ Optional Sale Date ”: The date of an Optional Sale under Section 2.19 .

“ Optional Sale Proceeds ”: Proceeds from an Optional Sale.

“ Originator ”: Defined in the Preamble of this Agreement but it being understood that all Loans originated by CapitalSource CF LLC and acquired by CSF (or its permitted successors and assigns) from CapitalSource CF LLC shall be deemed to have been originated by CSF (or its permitted successors and assigns) provided such acquisition is reflected on the Borrowing Base Certificate.

“ Other CapitalSource Facilities ”: Collectively, the Wachovia Facilities, the Credit Agreement, the Citibank Facilities (other than this Agreement), or any other securitization or other credit facility that is subject of the “Debt Acceleration” provision found in Section 6.15(k) hereto.

“ Other Costs ”: Defined in Section 13.9(c) .

“ Outstanding Asset Balance ”: With respect to any Asset at any time, the sum of (a) all future Scheduled Payments becoming due under or with respect to such Asset plus (b) any past due Scheduled Payments with respect to such Asset (other than with respect to those payments to the extent a Servicer Advance is outstanding with respect thereto); provided that notwithstanding anything to the contrary contained herein, for purposes of determining the Outstanding Asset Balance, if any Asset is a Charged-Off Asset or if any portion of an Asset is deemed to be “charged-off” in accordance with the provisions of the definition of Charged-Off Asset, then the entire Asset shall be deemed to have an Outstanding Asset Balance of zero, except for purposes of calculating the Average Pool Charged-Off Ratio; provided further that notwithstanding anything to the contrary contained herein, the Outstanding Asset Balance of any Asset that is a Delinquent Asset shall be deemed to be zero and the Outstanding Asset Balance at any time of any Asset that is an Acquired Loan (other than an Excluded Loan) shall be the Market Value of such Acquired Loan on its most recent Asset Valuation Date.

“ Parent Undertaking — Originator ”: The Parent Undertaking Agreement, in substantially the form of Exhibit N hereto, dated as of the Closing Date and confirmed on the New Effective Date, relating to the obligations of the Originator, made by CapitalSource Inc. in favor of the Seller, and assigned to the Administrative Agent, as such Parent Undertaking Agreement may be amended, modified, supplemented, restated or replaced from time to time.

“ Parent Undertaking — Servicer ”: The Parent Undertaking Agreement, in substantially the form of Exhibit O hereto, dated as of the Closing Date and confirmed on the New Effective Date, relating to the obligations of the Servicer, made by CapitalSource Inc. in favor of the Administrative Agent, as such Parent Undertaking Agreement may be amended, modified, supplemented, restated or replaced from time to time.

“ Participation Loan ”: A Loan to an Obligor, originated by the Originator and serviced by the Servicer in the ordinary course of its business, in which a participation interest has been granted to another Person in accordance with the Credit and Collection Policy and (i) such transaction has been fully consummated, pursuant to a participation agreement, (ii) such Loan (other than in the case of a Noteless Loan) is represented by a separate promissory note, and (iii) the Originator has the right to receive and collect payments directly in its own name, and to enforce its rights directly against the Obligor thereof including the right to proceed against collateral; provided that any such Loan shall exclude any Retained Interest.

“ Payment Date ”: The 15th day of each calendar month or, if any such day is not a Business Day, the next succeeding Business Day.

“ Payment Duties ”: Defined in Section 8.2(b) .

“ Permitted Hedge Counterparty ”: Means (a) Citibank, N.A. and its successors and assigns, and (b) any entity that (i) on the date of entering into a Hedging Agreement (x) is an interest rate swap dealer that has been approved in writing by the Administrative Agent (which approval shall not be unreasonably withheld), and (y) has a long-term unsecured debt rating of not less than “A” by S&P, not less than “A2” by Moody’s and not less than “A” by Fitch (if such entity is rated by Fitch) (“ Long-term Rating Requirement ”) and a short-term unsecured debt rating of not less than “A-1” by S&P, not less than “P-1” by Moody’s and not less than “F-1” by Fitch (if such entity is rated by Fitch) (“ Short-term Rating Requirement ”), and (ii) in a Hedging Agreement (x) consents to the assignment of the Seller’s rights under each Hedging Agreement to the Administrative Agent for the benefit of the Secured Parties pursuant to Section 5.3(b) and (y) agrees that in the event that Moody’s, S&P or Fitch reduces its long-term unsecured debt rating below the Long-term Rating Requirement, or reduces its short-term unsecured debt rating below the Short-term Rating Requirement, it shall transfer its rights and obligations under each Hedge Transaction to another entity that meets the requirements of clause (i) and (ii) hereof and has entered into a Hedging Agreement with the Seller on or prior to the date of such transfer.

“ Permitted Investments ”: With respect to any Payment Date means negotiable instruments or securities or other investments maturing on or before such Payment Date (a) which, except in the case of demand or time deposits, investments in money market funds and Eligible Repurchase Obligations, are represented by instruments in bearer or registered form or ownership of which is represented by book entries by a Clearing Agency or by a Federal Reserve Bank in favor of depository institutions eligible to have an account with such Federal Reserve Bank who hold such investments on behalf of their customers, (b) that, as of any date of determination, mature by their terms on or prior to the Business Day immediately preceding the next Payment Date immediately following such date of determination, and (c) that evidence:

     (1) direct obligations of, and obligations fully guaranteed as to full and timely payment by, the United States (or by any agency thereof to the extent such obligations are backed by the full faith and credit of the United States);

     (2) demand deposits, time deposits or certificates of deposit of depository institutions or trust companies incorporated under the laws of the United States or any state thereof and subject to supervision and examination by federal or state banking or depository institution authorities; provided that at the time of the Seller’s investment or contractual commitment to invest therein, the commercial paper, if any, and short-term unsecured debt obligations (other than such obligation whose rating is based on the credit of a Person other than such institution or trust company) of such depository institution or trust company shall have a credit rating from each Rating Agency in the Highest Required Investment Category;

     (3) commercial paper, or other short term obligations, having, at the time of the Seller’s investment or contractual commitment to invest therein, a rating in the Highest Required Investment Category granted by each Rating Agency;

     (4) demand deposits, time deposits or certificates of deposit that are fully insured by the FDIC and either have a rating on their certificates of deposit or short-term deposits from Moody’s and S&P of “P-1” and “A-1”, respectively, and if rated by Fitch, from Fitch of “F-1+”;

     (5) notes that are payable on demand or bankers’ acceptances issued by any depository institution or trust company referred to in clause (ii) above;

     (6) investments in taxable money market funds or other regulated investment companies having, at the time of the Seller’s investment or contractual commitment to invest therein, a rating of the Highest Required Investment Category from Moody’s, S&P and Fitch (if rated by Fitch);

     (7) time deposits (having maturities of not more than 90 days) by an entity the commercial paper of which has, at the time of the Seller’s investment or contractual commitment to invest therein, a rating of the Highest Required Investment Category granted by each Rating Agency; or

     (8) Eligible Repurchase Obligations with a rating acceptable to the Administrative Agent, which rating, in the case of Fitch, shall be “F-1+” and, in the case of S&P, shall be “A-1”.

The Collateral Custodian may pursuant to the direction of the Servicer or Administrative Agent, as applicable, purchase or sell to itself or an Affiliate, as principal or agent, the Permitted Investments described above.

“ Permitted Liens ”: With respect to the Collateral (i) Liens for state, municipal or other local taxes (other than payroll taxes) if such taxes shall not at the time be due and payable or are being contested in good faith by appropriate proceedings and with respect to which adequate reserves or other appropriate provisions are being maintained in accordance with GAAP so long as there exists no material risk of sale, forfeiture, loss, or loss of or interference with use or possession of, or diminution of value, utility or useful life of, the related Collateral, (ii) Liens imposed by operation of law, such as materialmen’s, mechanics’, carriers’, workmen’s and repairmen’s liens and other similar liens arising in the ordinary course of business securing obligations that are not overdue for a period of more than thirty (30) days or are being contested in good faith by appropriate proceedings and with respect to which adequate reserves or other appropriate provisions are being maintained in accordance with GAAP so long as there exists no material risk of sale, forfeiture, loss, or loss of or interference with use or possession of, or diminution of value, utility or useful life of, the related Collateral, (iii) Liens (other than any Lien imposed by ERISA) on or in respect of deposits or pledges of cash or letters of credit posted in the ordinary course of business (including, without limitation, surety bonds and appeal bonds) in connection with workers’ compensation, unemployment insurance and other types of social security benefits or to secure the performance of tenders, bids, leases, contracts (other than for the repayment of Indebtedness), statutory obligations and other similar obligations, provided that any such Lien attaches only to the cash collateral or letter of credit posted to secure such obligation, and (iv) Liens pursuant to indebtedness incurred by an Obligor that is subordinated, pursuant to a customary and appropriate subordination agreement, to all present and future obligations, indebtedness and liabilities of Obligor or any related guarantor under or in respect of the related Asset at any time and from time to time of every kind, nature and description, direct or indirect, secured or unsecured, joint and several, absolute or contingent, due or to become due, matured or unmatured, now existing or hereafter arising, contractual or tortious, liquidated or unliquidated, such that the Lien in favor of the Originator is senior in priority and the subordinated lien holder is subject to restrictions for a customary and reasonable period of time with respect to its right to take foreclosure actions or exercise other remedies with respect to the related collateral (other than the subordinated lien holder’s customary purchase option of the senior indebtedness at par) in accordance with its credit and collection policies. With respect to the Assets, Liens in favor of the Administrative Agent.

“ Permitted Securitization Transaction ”: Any financing transaction undertaken by the Seller or an Affiliate of the Seller that is secured, directly or indirectly, by the Collateral or any portion thereof or any interest therein, including any sale, lease, whole loan sale, asset securitization, secured loan or other transfer.

“ Person ”: An individual, partnership, corporation (including a business trust), limited liability company, joint stock company, trust, unincorporated association, sole proprietorship, joint venture, government (or any agency or political subdivision thereof) or other entity.

“ Placement Agent ”: Defined in Section 2.22 .

“ Pool Charged-Off Ratio ”: As of any Determination Date, the product of (i) 12 and (ii) the percentage equivalent of a fraction, (a) the numerator of which is equal to the sum of the Outstanding Asset Balances of all Eligible Assets that became Charged-Off Assets (net of Recoveries during such Collection Period) during the Collection Period related to such Determination Date, and (b) the denominator of which is equal to the Aggregate Outstanding Asset Balance as of the first day of the Collection Period related to such Determination Date.

“ Pool Concentration Criteria ”: On any day, each of the concentration limitations as set forth below, which concentration limitations (unless otherwise indicated) shall, in each case consider the Existing Loan Balance of one or more Loans and be measured on the basis of a percentage of the Aggregate Existing Loan Balances:

     (i) the sum of the Existing Loan Balance representing exposure to a single Obligor shall not exceed the greater of (i) 3% of the Aggregate Existing Loan Balance, or (ii) $30,000,000; provided however that in no event shall the aggregate Existing Loan Balance representing exposure to a single Obligor exceed $50,000,000;

     (ii) no more than 25% of the Aggregate Existing Loan Balance shall have an Existing Loan Balance in excess of $25,000,000;

     (iii) (A) the aggregate Existing Loan Balance of all Eligible Assets the Obligors of which are domiciled within a single state (other than Florida and California) shall not exceed the greater of (x) $20,000,000 and (y) 20% of the Aggregate Existing Loan Balance and (B) the aggregate Existing Loan Balance of all Eligible Assets the Obligors of which are domiciled in either the state of Florida or the state of California shall not exceed the greater of (x) $20,000,000 and (y) 30% of the Aggregate Existing Loan Balance;

     (iv) the aggregate Existing Loan Balance of Eligible Assets the Obligors of which are domiciled outside of the United States or Canada shall not exceed the greater of (x) $20,000,000 and (y) 10% of the Aggregate Existing Loan Balance of all Eligible Assets;

     (v) the aggregate Existing Loan Balance of Eligible Assets within a single industry (which shall be determined by the Originator based on the four digit NAIC code and included on the Asset List) shall not exceed the greater of (x) $20,000,000 and (y) 30% of the Aggregate Existing Loan Balance of all Eligible Assets;

     (vi) the aggregate Existing Loan Balance of Assets consisting of Subordinated Loans shall not exceed the greater of (x) $20,000,000 and (y) 20% of the Aggregate Existing Loan Balance of all Eligible Assets;

     (vii) the aggregate Existing Loan Balance of Eligible Assets assigned Loan Rating 4 shall not exceed 20% of the Aggregate Existing Loan Balance of all Eligible Assets, and the aggregate Existing Loan Balance of Eligible Assets assigned Loan Rating 5 shall not exceed 10% of the Aggregate Existing Loan Balance of all Eligible Assets;

     (viii) the aggregate Existing Loan Balance of DIP Loans shall not exceed the greater of (x) $20,000,000 or (y) 20% of the Aggregate Existing Loan Balance of all Eligible Assets;

     (ix) the aggregate Existing Loan Balance of Eligible Assets subject to Scheduled Payments of interest on a basis other than monthly shall not exceed the greater of (x) $20,000,000 and (y) 25% of the Aggregate Existing Loan Balance of all Eligible Assets;

     (x) the aggregate Existing Loan Balance of all Senior B-Note Loans shall not exceed the greater of (x) $20,000,000 and (y) 20% of the Aggregate Existing Loan Balance of all Eligible Assets; provided, however that any Senior B-Note Loan or portion thereof in excess of this limitation shall be considered a Subordinated Loan for purposes of determining eligibility;

     (xi) [Intentionally Omitted];

     (xii) the aggregate Existing Loan Balance of Acquired Loans shall not exceed 50% of the Aggregate Existing Loan Balance of all Eligible Assets;

     (xiii) the aggregate Existing Loan Balance of any single bulk purchase of Acquired Loans shall not exceed the greater of (x) $20,000,000 and (y) 20% of the Aggregate Existing Loan Balance of all Eligible Assets without the approval of the Administrative Agent;

     (xiv) the sum of (a) the aggregate Existing Loan Balance of Senior Loans and Senior B-Note Loans with an original term to maturity of 7 years or greater and (b) the aggregate Existing Loan Balance of Subordinated Loans with an original term to maturity of 10 years or greater shall not exceed $100,000,000;

     (xv) the aggregate Existing Loan Balance of the Rated Retained Securities shall not exceed 2.5% of the Aggregate Existing Loan Balance of all Eligible Assets;

     (xvi) the weighted average life of the Eligible Assets shall not exceed 4.0 years; and

     (xvii) the Loan Margin shall not be less than 3.00%.

“ Pool Rate ”: As of any Determination Date, the annualized percentage equivalent of a fraction, (a) the numerator of which is equal to all Interest Collections on Assets included in the Aggregate Outstanding Asset Balance as of the first day of the Collection Period related to such Determination Date that are deposited into the Collection Account during such Collection Period, and (b) the denominator of which is equal to the Aggregate Outstanding Asset Balance as of the first day of such Collection Period.

“ Pool Yield ”: On any day, the excess, if any, of (a) the Pool Rate on such day over (b) the sum of (i) the weighted average Interest Rate applicable to the Advances multiplied by the Pool Yield Applicable Advance Rate, (ii) the weighted average Program Fee Rate applicable to the Advances multiplied by the Pool Yield Applicable Advance Rate, (iii) the Structuring and Agency Fee Rate multiplied by the Pool Yield Applicable Advance Rate, (iv) the Commitment Fee Rate multiplied by the Pool Yield Applicable Advance Rate and (iv) the Servicing Fee Rate, in each case as of such day.

“ Pool Yield Applicable Advance Rate ”: On any date of determination, the sum of (A)(i) the advance rate utilized in clause (b)(I) of the definition of “Maximum Availability” multiplied by the Existing Loan Balances, plus (ii) the New Loan Advance Rate multiplied by the New Loan Balances, divided by (B) the Aggregate Outstanding Asset Balance.

“ Portfolio Aggregate Outstanding Asset Balance ”: With respect to all Portfolio Assets, on any day, the sum of the Portfolio Outstanding Asset Balances of such Portfolio Assets on such date. Notwithstanding anything to the contrary contained herein, for purposes of determining the Portfolio Aggregate Outstanding Asset Balance, if any portion of a Portfolio Asset is deemed to be “charged-off” in accordance with the provisions of the definition of Charged-Off Portfolio Asset, then the entire Portfolio Asset shall have a zero Outstanding Asset Balance, except for purposes of calculating the Average Portfolio Charged-Off Ratio.

“ Portfolio Asset ”: Any asset owned or serviced by the Originator (including each Asset). For the avoidance of doubt, the term Portfolio Asset shall not include any asset owned and/or serviced solely by one or more Affiliates of the Originator (but not by the Originator); provided that (i) such asset shall not have been originated or acquired by the Originator and (ii) such asset shall not be included in the consolidated financial statements of the Originator.

“ Portfolio Delinquency Ratio ”: As of any Determination Date, the percentage equivalent of a fraction, (i) the numerator of which is equal to the sum of the Portfolio Outstanding Asset Balances of all Delinquent Portfolio Assets on such date and (ii) the denominator of which is equal to the Portfolio Aggregate Outstanding Asset Balance on such date.

“ Portfolio Outstanding Asset Balance ”: With respect to any Portfolio Asset, the sum of (i) the portion of all future Scheduled Payments becoming due under or with respect to such Portfolio Asset plus (ii) any past due Scheduled Payments with respect to such Portfolio Asset.

“ Prepaid Asset ”: Any Asset (other than a Charged-Off Asset) that was terminated or has been prepaid in full or in part prior to its scheduled expiration date.

“ Prepayment Amount ”: Defined in Section 6.4(b) .

“ Prepayments ”: Any and all (i) partial or full prepayments on or with respect to an Asset (including, with respect to any Asset and any Collection Period, any Scheduled Payment, Finance Charge or portion thereof that is due in a subsequent Collection Period that the Servicer has received, and pursuant to the terms of Section 6.4(b) expressly permitted the related Obligor to make, in advance of its scheduled due date, and that will be applied to such Scheduled Payment on such due date), (ii) Recoveries, and (iii) Insurance Proceeds.

“ Prime Rate ”: The rate announced publicly by Citibank from time to time as its base rate in the United States, such rate to change as and when such designated rate changes. The Prime Rate is not intended to be the lowest rate of interest charged by Citibank or any other specified financial institution in connection with extensions of credit to debtors.

“ Prime Rate Asset ”: A Floating Rate Asset where the interest rate payable by the Obligor thereof is based on the CSF Prime Rate.

“ Principal Collections ”: Any and all amounts received in respect of any principal due and payable from or on behalf of Obligors that are deposited into the Principal Collections Account, or received by or on

behalf of the Seller by the Servicer or Originator in respect of Assets, in the form of cash, checks, wire transfers, electronic transfers or any other form of cash payment.

“ Principal Collections Account ”: Defined in Section 6.4(f) .

“ Pro Rata CS VII Reduction Amount ”: An amount equal to the product of (i) the Pro Rata Reduction Amount multiplied by (ii) the quotient of (x) the Advances Outstanding hereunder, divided by (y) the Combined Advances Outstanding.

“ Pro Rata Percentage ”: As of any date of determination (determined prior to the payment or allocation of any Special Reduction Amount hereunder), the quotient (expressed as a percentage) of (i) the Combined Advances Outstanding, divided by (ii) the Credit Agreement Advances Outstanding.

“ Pro Rata Reduction Amount ”: An amount (expressed in dollars) equal to the Pro Rata Percentage of any Credit Agreement Reduction Amount.

“ Proceeds ”: With respect to any Collateral, whatever is receivable or received when such Collateral is sold, liquidated, foreclosed, exchanged, or otherwise disposed of, whether such disposition is voluntary or involuntary, and includes all rights to payment with respect to any insurance relating to such Collateral.

“ Program Fee ”: With respect to any Purchaser, as defined in the Purchaser Fee Letter.

“ Program Fee Rate ”: With respect to any Purchaser, the rate set forth in the Purchaser Fee Letter.

“ Purchaser ”: (i) any Issuer and (ii) any Liquidity Bank, as the context requires; and “ Purchasers ” means collectively (a) the Issuers and (b) the Liquidity Banks.

“ Purchaser Affiliate ”: With respect to a Purchaser, means any other Person that, directly or indirectly, controls, is controlled by or under common control with such Person. For purposes of this definition, “control” (including the terms “controlling,” “controlled by” and “under common control with”) when used with respect to any specified Person means the possession, direct or indirect, of the power to vote 50% or more of the voting securities of such Person or to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by contract or otherwise

“ Purchaser Fee Letter ”: The Amended and Restated Purchaser Fee Letter, dated as of the New Effective Date, by and among the Seller, the Servicer, the Administrative Agent, 2007-A/LLC and CSE Mortgage LLC, as amended, modified, waived, supplemented, restated or replaced from time to time.

“ Qualified Institution ”: Defined in Section 6.4(f) .

“ Qualified Transferee ”:

     (a) The Seller, the Administrative Agent or any of their Affiliates; or

     (b) any other Person which:

     (i) has at least $50,000,000 in capital/statutory surplus or shareholders’ equity (except with respect to a pension advisory firm or similar fiduciary); and

     (ii) is regularly engaged in the business of making or owning commercial real estate loans or operating commercial real estate properties; and

     (iii) is one of the following: (I) an insurance company, bank, savings and loan association, investment bank, trust company, commercial credit corporation, pension plan, pension fund, pension fund advisory firm, mutual fund, real estate investment trust, governmental entity or plan; (II) an investment company, money management firm or a “qualified institutional buyer” within the meaning of Rule 144A under the Securities Act of 1933, as amended, or an “institutional accredited investor” within the meaning of Regulation D under the Securities Act of 1933, as amended; or (III) the trustee, collateral agent or administrative agent in connection with (x) a securitization of the subject Asset through the creation of collateralized debt or loan obligations or (y) an asset-backed commercial paper transaction funded by a commercial paper conduit whose commercial paper notes are rated at least “A-1” by S&P or at least “P-1” by Moody’s, or (z) a repurchase transaction funded by an entity which would otherwise be a Qualified Transferee so long as the “equity interest” (other than any nominal or de minimis equity interest) in the special purpose entity that issues notes or certificates in connection with any such collateralized debt or loan obligation, asset-backed commercial paper funded transaction or repurchase transaction is owned by one or more entities that are Qualified Transferees under subclauses (A) or (B) above; or (IV) any entity Controlled (as defined below) by any of the entities described in subclauses (i), (ii) or (iii) above.

For purposes of this definition only, “Control” means the ownership, directly or indirectly, in the aggregate of more than 50% of the beneficial ownership interests of an entity and the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of an entity, whether through the ability to exercise voting power, by contract or otherwise, and “Controlled” has the meaning correlative thereto.

“ Qualified Utilization ”: Defined in Section 2.21(b) .

“ Quarterly Determination Date ”: March 31, June 30, September 30 and December 31 of each calendar year.

“ Rated Retained Securities ”: Each of (i) the CapitalSource Commercial Loan Trust Class E Floating Rate Deferrable Asset Backed Notes, Series 2006-1; and (ii) such other securities as agreed upon by the Administrative Agent.

“ Rating Agency ”: Each of S&P, Moody’s and Fitch.

“ Records ”: All documents relating to the Assets, including books, records and other information (including without limitation, computer programs, tapes, disks, punch cards, data processing software and related property and rights) executed in connection with the origination or acquisition of the Collateral or maintained with respect to the Collateral and the related Obligors that the Seller, the Originator or the Servicer have generated, in which the Seller, the Originator or the Servicer have acquired an interest pursuant to the Sale Agreement or in which the Seller, the Originator or the Servicer have otherwise obtained an interest.

“ Recoveries ”: As of the time any Related Property or any other related property is sold, discarded (after a determination by the Servicer that such Related Property or any other related property has little or no remaining value) or otherwise determined to be fully liquidated by the Servicer in accordance with the Credit and Collection Policy (or such similar policies and procedures utilized by the Servicer in servicing the Portfolio Assets) with respect to any Charged-Off Asset or Charged-Off Portfolio Asset, the proceeds from the sale of the Related Property or any other related property, the proceeds of any related Insurance Policy, any distribution from a REO Asset Owner with respect to a REO Asset, any other recoveries with respect to such Charged-Off Asset or Charged-Off Portfolio Asset (including recoveries

in the form of sale proceeds from Optional Sales), the Related Property, any other related property, and amounts representing late fees and penalties, net of Liquidation Expenses and amounts, if any, received that are required under such Asset or Portfolio Asset, as applicable, to be refunded to the related Obligor.

“ Refinancing ”: Defined in Section 2.22 .

“ Register ”: Defined in Section 13.16(c) .

“ Regulation U ”: Regulation U of the Board of Governors of the Federal Reserve System, 12 C.F.R. §221, or any successor regulation.

“ Related Property ”: With respect to an Asset, any property or other assets pledged as collateral to the Originator to secure repayment of such Asset including all Proceeds from any sale or other disposition of such property or other assets.

“ Related Security ”: All of the Seller’s right, title and interest in and to:

     (a) any Related Property securing an Asset and all Recoveries related thereto;

     (b) all Required Asset Documents, Asset Files related to any Asset, Records, and the documents, agreements, and instruments included in the Asset File or Records, including without limitation, rights of recovery of the Seller against the Originator;

     (c) all Insurance Policies with respect to any Asset;

     (d) all security interests, liens, guaranties, warranties, letters of credit, accounts, bank accounts, mortgages or other encumbrances and property subject thereto from time to time purporting to secure or support payment of any Asset, together with all UCC financing statements or similar filings signed by an Obligor relating thereto;

     (e) the Collection Account, each Lock Box, all Lock Box Accounts and the Securities Account, together with all cash and investments in each of the foregoing other than amounts earned on investments therein;

     (f) any Hedging Agreement and any payment from time to time due thereunder;

     (g) the Sale Agreement and the assignment to the Administrative Agent of all UCC financing statements filed by the Seller against the Originator under or in connection with the Sale Agreement; and

     (h) the proceeds of each of the foregoing.

“ REO Asset ”: With respect to any Loan, any Related Property that has been foreclosed on or repossessed from the current Obligor by the Servicer, and is being managed by the Servicer on behalf of, and in the name of, any REO Asset Owner, for the benefit of the Secured Parties and any other equity holder of such REO Asset Owner.

“ REO Asset Owner ”: Defined in Section 6.17.

“ REO Contribution Agreement ”: Defined in Section 6.17.

“ REO Pledge Agreement ”: That certain Pledge Agreement, dated as of the A&R Effective Date, pledging the equity interests in any REO Asset Owner established from time to time and held by the Seller, in

favor of the Administrative Agent, in substantially the form attached hereto as Exhibit 09-I , as such agreement may be amended, modified or supplemented from time to time in accordance with its terms.

“ REO Servicing Standard ”: Defined in Section 6.17.

“ Replaced Asset ”: Defined in Section 2.18(a) .

“ Reporting Date ”: The date that is two Business Days prior to each Payment Date.

“ Required Advance Reduction Amount ”: On any day, an amount equal to the sum of (1) the greater of (i) the positive difference, if any, of Advances Outstanding on such day minus the Maximum Availability on such day, and (ii) with respect to all other Principal Collections, 75% (or, in connection with an Optional Sale under Section 2.19 , such other amount set forth in the consent provided in connection therewith), of the amount of Principal Collections (including, without limitation, principal reductions under Revolving Loans) in the Principal Collections Account, plus (2) the Special Reduction Amount, and minus (3) amounts paid to the Administrative Agent and applied in the manner set forth in Section 2.8 .

“ Required Asset Documents ”: With respect to Existing Assets, the meaning assigned to the term “Required Loan Documents” in the CS VII Issuer Financing SSA. With respect to all other Assets, as follows: With respect to (i) any Noteless Loan identified as a Noteless Loan on the Asset Checklist, a copy of the related Loan Register (together with a certificate of a Responsible Officer of the Servicer certifying to the accuracy of such Loan Register as of the date such Loan is included as a part of the Collateral), (ii) all Loans other than Noteless Loans, the duly executed original of the promissory note and an assignment (which may be by endorsement or allonge) of each such promissory note to the Seller and then the Administrative Agent, signed by an officer of the Originator and the Seller, respectively, (iii) any Loan, any related loan agreement and the Asset Checklist together with, to the extent set forth on the Asset Checklist, duly executed (if applicable) originals or copies of each of any related participation agreement, acquisition agreement, subordination agreement, intercreditor agreement, security agreements or similar instruments, UCC financing statements, guarantee, or Insurance Policy (iv) for each Loan, other than Agented Loans or Acquired Loans (or other Loans for which an Assignment of Mortgage has been delivered to Wells Fargo in its capacity as trustee or custodian pursuant to a prior term transaction or warehouse facility involving the Originator or one of its Affiliates), secured by real property, an Assignment of Mortgage, (v) for any Loan identified as an Acquired Loan on the Asset Checklist, the duly executed original assignment agreement; provided that with respect to any Acquired Loan, any of the foregoing documents, other than any related promissory notes in the case of Acquired Loans only, may be copies, and (vi) for any Loan identified as an Alarm Service Loan on the Asset Checklist, the duly executed version of each of the following: the original (and to the extent it exists, the sole chattel paper counterpart) master purchase agreement and, if any, security agreement and a copy of the purchase statement related to each Alarm Service Loan, signed by an officer of the originator of such Alarm Service Loan together with copies of any related assignment agreements, subordination agreement (if set forth on the Asset Checklist), intercreditor agreement (if set forth on the Asset Checklist), security agreements or instruments (to the extent any security interest in collateral has been granted and as set forth in the Asset Checklist or the Asset List), UCC financing statements (to the extent any security interest in collateral has been granted and as set forth in the Asset Checklist or the Asset List) and guarantee (if set forth on the Asset Checklist).

“ Required Reports ”: Collectively, the Monthly Report, the Servicer’s Certificate required pursuant to Section 6.10(c) , the financial statements of the Servicer required pursuant to Section 6.10(d) , the annual statements as to compliance required pursuant to Section 6.11 , and the annual independent public accountant’s report required pursuant to Section 6.12 .

“ Reserve Funding Date ”: The date (which must occur prior to the Revolving Period Fail Date) on which the Seller shall deposit $12,500,000 in the Special Funding Account pursuant to the provisions of Section 2.21 .

“ Responsible Officer ”: With respect to any Person, any duly authorized officer of such Person with direct responsibility for the administration of this Agreement and also, with respect to a particular matter, any other duly authorized officer to whom such matter is referred because of such officer’s knowledge of and familiarity with the particular subject.

“ Restricted Junior Payment ”: (i) any dividend or other distribution, direct or indirect, on account of any class of membership interests of the Seller now or hereafter outstanding, except a dividend payment solely in interests of that class of membership interests or in any junior class of membership interests of the Seller; (ii) any redemption, retirement, sinking fund or similar payment, purchase or other acquisition for value, direct or indirect, of any class of membership interest of the Seller 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 membership interests of Seller now or hereafter outstanding, and (iv) any payment of management fees by the Seller (except for reasonable management fees to the Originator or its Affiliates in reimbursement of actual management services performed).

“ Retained Interest ”: (A) With respect to any Revolving Loan or any Loan with an unfunded commitment on the part of the Originator that does not provide by its terms that funding thereunder is in Originator’s sole and absolute discretion and that is transferred by the Originator to the Seller and/or by the Seller to the Purchasers, all of the obligations, if any, to provide additional funding with respect to such Revolving Loan, and (B) with respect to any Acquired Loan, any Participation Loan or any Agented Loan that is transferred by the Originator to the Seller and/or by the Seller to the Purchasers, (i) all of the obligations, if any, of the agent(s) under the documentation evidencing such Acquired Loan, Participation Loan, or Agented Loan and (ii) the applicable portion of the interests, rights and obligations under the documentation evidencing such Acquired Loan, Participation Loan, or Agented Loan that relate to such portion(s) of the indebtedness that is owned by another lender or is being retained by the Originator pursuant to clause (A) of this definition.

“ Retransfer Date ”: Defined in Section 4.6 .

“ Retransfer Price ”: Defined in Section 4.6 .

“ Review Criteria ”: Defined in Section 8.2(b)(i) .

“ Revolving Loan ”: A Loan that is a line of credit or contains an unfunded commitment arising from an extension of credit by the Originator to an Obligor, pursuant to the terms of which amounts borrowed may be repaid and subsequently reborrowed; provided that any such Loan shall exclude any Retained Interest.

“ Revolving Period ”: The period, if any, commencing upon the occurrence of each of the Wachovia Amendment Date and the Reserve Funding Date on or prior to the Revolving Period Fail Date, and ending on the earliest to occur of (a) the day immediately preceding the Termination Date (without consideration of the Termination Extension Date), (b) the occurrence of any Determination Date on which (i) the Average Portfolio Delinquency Ratio equals or exceeds 6.50%, (ii) the Average Pool Charged-Off Ratio equals or exceeds 4.00%, (iii) the Pool Yield equals or is less than 1.00%, and (c) the occurrence of any Quarterly Determination Date on which (i) the Average Portfolio Charged-Off Ratio exceeds 10.00%,

or (ii) the Originator’s ratio of Consolidated Funded Indebtedness to Consolidated Tangible Net Worth exceeds 6 to 1.

“ Revolving Period Fail Date ”: June 1, 2009.

“ S&P ”: Standard & Poor’s, a division of The McGraw-Hill Companies, Inc., and any successor thereto.

“ Sale Agreement ”: The Amended and Restated Loan Sale Agreement, dated as of the Closing Date, between the Originator and the Seller, as amended on the New Effective Date, and as it may be further amended, modified, waived, supplemented, restated or replaced from time to time.

“ Scheduled Payments ”: With respect to any Asset, each monthly, quarterly, or annual payment of principal required to be made by the Obligor thereof under the terms of such Asset; in all cases, excluding any payment in the nature of, or constituting, interest.

“ Secured Party ”: (i) each Purchaser, (ii) the Administrative Agent and (iii) each Hedge Counterparty that is either a Purchaser or an Affiliate of the Administrative Agent if that Affiliate is a Hedge Counterparty that executes a counterpart of this Agreement agreeing to be bound by the terms of this Agreement applicable to a Secured Party.

“ Securities Account ”: Defined in Section 6.4(h) .

“ Securities Intermediary ”: Defined in Section 8.11(a) .

“ Seller ”: Defined in the Preamble of this Agreement.

“ Senior Loan ”: A Loan that (i) is secured by a first priority lien on all of the Obligor’s assets constituting Collateral for such Loan (subject to Permitted Liens), (ii) has a Loan-to-Value Ratio less than or equal to 90% and (iii) provides that the payment obligation of the related Obligor on such Loan is either senior to, or pari passu with, all other loans or financings to such Obligor.

“ Senior B-Note Loan ”: Any multilender Loan that (i) is secured by a first priority lien on all the Obligor’s assets constituting Collateral for such Loan (subject to Permitted Liens), (ii) has a Loan-to-Value Ratio less than or equal to 90%, and (iii) that contains provisions which, upon the occurrence of an event of default under the underlying loan documents or in the case of any liquidation or foreclosure on the related Collateral, the Originator’s (or its assignee’s) portion of such Loan would be paid only after the other lender party to such Loan (whose right to payment is contractually senior to the Originator or such assignee) is paid in full.

“ Senior Secured Loan ”: Either a Senior Loan or a Senior B-Note Loan.

“ Servicer ”: CSF, and each successor (in the same capacity) appointed as Successor Servicer pursuant to Section 6.16(a) .

“ Servicer Advance ”: An advance of Scheduled Payments made by the Servicer pursuant to Section 6.5 .

“ Servicer Default ”: Defined in Section 6.15 .

“ Servicer Termination Notice ”: Defined in Section 6.15 .

“ Servicer’s Certificate ”: Defined in Section 6.10(c) .

“ Servicing Fee ”: Defined in Section 2.14(b); provided , that solely with respect to Servicing Fee payable to the Backup Servicer acting as successor Servicer hereunder, “Servicing Fee” instead means as set forth in the following language (with capitalized terms used in such language but not defined herein to have the meaning given such terms in the CS VII Issuer Financing SSA, and with the definition of Servicing Fee and references to Servicing Fee Rate set forth in Section 2.14(b) deemed to be replaced by the substantive meaning of the following language, but applied in the context of this Agreement): with respect to each Eligible Asset (including any Eligible Asset that has been foreclosed and for which the related Mortgaged Property has become a Foreclosure Property, but excluding any Liquidated Loan), for each Remittance Period, a per annum fee equal to the sum of (i) 1.00% of the Principal Balance of each Loan (other than Revolving Loans) and (ii) 1.25% of the Principal Balance of each Revolving Loan, in each case at the beginning of such Remittance Period payable to the Servicer for the servicing of such Eligible Loan out of Scheduled Payments made by the Obligor thereunder in an amount determined in the manner in effect on the related Transfer Date (or, in the case of Additional Assets, the related Funding Date).

“ Servicing Fee Rate ”: 0.50% per annum for Eligible Assets which are not Workout Assets and 0.75% per annum for Workout Assets, without duplication.

“ Solvent ”: As to any Person at any time, having a state of affairs such that all of the following conditions are met: (a) the fair value of the property of such Person is greater than the amount of such Person’s liabilities (including disputed, contingent and unliquidated liabilities) as such value is established and liabilities evaluated for purposes of Section 101(32) of the Bankruptcy Code; (b) the present fair salable value of the property of such Person in an orderly liquidation of such Person is not less than the amount that will be required to pay the probable liability of such Person on its debts as they become absolute and matured; (c) such Person is able to realize upon its property and pay its debts and other liabilities (including disputed, contingent and unliquidated liabilities) as they mature in the normal course of business; (d) such Person does not intend to, and does not believe that it will, incur debts or liabilities beyond such Person’s ability to pay as such debts and liabilities mature; and (e) such Person is not engaged in a business or a transaction, and is not about to engage in a business or a transaction, for which such Person’s property would constitute unreasonably small capital.

“ Special Funding Account ”: Defined in Section 2.21(a) .

“ Special Reduction Amount ”: An amount equal to (i) with respect to an Initial Credit Agreement Mandatory Reduction Amount, an amount equal to the lesser of (x) the Weighted Average Advance Reduction Amount, and (y) the Pro Rata CS VII Reduction Amount, and (ii) with respect to (A) any Credit Agreement Optional Reduction Amount, and (B) any Credit Agreement Mandatory Reduction Amount arising after the initial renewal and extension of the Credit Agreement following the New Effective Date (other than any Initial Credit Agreement Reduction Amount), an amount equal to the Pro Rata CS VII Reduction Amount.

“ Special Reduction Amount Date ”: The date of payment of a Credit Agreement Reduction Amount under the Credit Agreement.

“ Structuring and Agency Fee ”: With respect to any Purchaser, as defined in the Purchaser Fee Letter.

“ Structuring and Agency Fee Rate ”: With respect to any Purchaser, the rate set forth in the Purchaser Fee Letter.

“ Subordinated Loan ”: Any Loan other than a Senior Loan or a Senior B-Note Loan.

“ Subsidiary ”: 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; provided that any joint ventures in which each party to the joint venture possesses 50% of the Voting Stock of such entity shall be expressly excluded from this definition.

“ Substitute Asset ”: On any day, an Eligible Asset that meets each of the conditions for substitution set forth in Section 2.18 .

“ Successor Servicer ”: Defined in Section 6.16(a) .

“ Swap Breakage Costs ”: For any Hedge Transaction, any amount payable by the Seller for the early termination of that Hedge Transaction or any portion thereof.

“ TALF Program ”: Defined in Section 2.22 .

“ Tape ”: Defined in Section 7.2(b)(ii) .

“ Taxes ”: Any present or future taxes, levies, imposts, duties, charges, assessments or fees of any nature (including interest, penalties, and additions thereto) that are imposed by any Governmental Authority.

“ Termination Date ”: The earliest of (a) the date of the termination of the Facility Amount pursuant to Section 2.4 , (b) the Business Day designated by the Seller to the Administrative Agent as the Termination Date at any time following two Business Days’ prior written notice thereof to the Administrative Agent, (c) the later to occur of (i) April 19, 2010, and (ii) solely in connection with the utilization of this defined term in the defined terms “Amortization Period” and “Final Maturity Date” and subject to the satisfaction of the conditions precedent set forth in Section 3.4 , the Termination Extension Date, or (d) with respect to any Purchaser who is an Issuer the date any Liquidity Agreement shall cease to be in full force and effect, or (e) the date of the declaration or automatic occurrence of the Termination Date pursuant to Section 10.2 .

“ Termination Extension Date ”: The earliest to occur of (i) either (x) the second anniversary of the last day of the Revolving Period or (y) if the Revolving Period never occurs, April 17, 2012, (ii) the date on which the “Commitment Termination Date” (or other date upon which the payment in full of all “Revolving Loans” becomes due and payable under the Credit Agreement) occurs and is not extended under the Credit Agreement, and (iii) and the Collection Date.

“ Termination Event ”: Defined in Section 10.1 .

“ Term Loan ”: A Loan that is a term loan that has been fully funded and does not contain any unfunded commitment on the part of the Originator arising from an extension of credit by the Originator to an Obligor.

“ Term Loan Reduction Amounts ”: Amounts applied from time to time following the New Effective Date pursuant to Section 2.9(a)(6) or Section 2.10(a)(6) to Advances Outstanding from Principal Collections on Term Loans.

“ TNW Test Level ”: The greater of (A) sum of (i) $1,015,000,000, plus (ii) 70% of the cumulative Net Proceeds of Capital Stock/Conversion of Debt received at any time after December 31, 2005 (other than

the period commencing on January 1, 2008 and ending on September 30, 2008), plus (iii) 30% of the cumulative Net Proceeds of Capital Stock/Conversion of Debt received at any time during the period commencing on January 1, 2008 and ending on September 30, 2008, and (B) the covenant level for “Minimum Consolidated Tangible Net Worth” set forth under any of the Other CapitalSource Facilities, including Section 5.32(c) of the Credit Agreement (or any replacement provision thereunder).

“ Transaction ”: Defined in Section 3.2 .

“ Transaction Documents ”: This Agreement, the Sale Agreement, each Hedging Agreement, the Hedge Guaranty, the REO Pledge Agreement, the Account Control Agreement, the Lock-Box Agreement, the Intercreditor Agreement, the Confirmation and Undertaking Letter, the Parent Undertaking-Originator, the Parent Undertaking-Servicer, the Capital Contribution Agreement, the 2007-A Pledge Agreement, the Confirmation and Undertaking Letter, the Memorandum of Understanding, each Variable Funding Certificate, the Purchaser Fee Letter, the Backup Servicer and Collateral Custodian Fee Letter, any UCC financing statements filed pursuant to the terms of this Agreement, and any additional document the execution of which is necessary or incidental to carrying out the terms of the foregoing documents.

“ Transition Expenses ”: The reasonable costs (including reasonable attorneys’ fees) of the Backup Servicer incurred in connection with the transferring the servicing obligations under this Agreement and amending this Agreement to reflect such transfer in an amount not to exceed $100,000.

“ UCC ”: The Uniform Commercial Code as from time to time in effect in the applicable jurisdiction or jurisdictions.

“ Underlying Instruments ”: The indenture, loan agreement, credit agreement or other agreement pursuant to which a Loan has been issued or created and each other agreement that governs the terms of or secures the obligations represented by such Loan or of which the holders of such Loan are the beneficiaries related thereto.

“ United States ”: The United States of America.

“ Unmatured Termination Event ”: Any event that, with the giving of notice or the lapse of time, or both, would become a Termination Event.

“ Unrestricted Subsidiary ”: An “Unrestricted Subsidiary” under and as defined in the Credit Agreement.

“ Variable Funding Certificate” or “ VFC ”: Defined in Section 2.1(a) .

“ Voting Stock ”: With respect to any Person, Capital Stock or membership interests (in the case of a limited liability company) issued by such Person the holders of which are ordinarily, in the absence of contingencies, entitled to vote for the election of directors (or persons performing similar functions) of such Person, even though the right so to vote has been suspended by the happening of such contingency.

“ Wachovia Amendment Date ”: The date (which must occur prior to the Revolving Period Fail Date) on which the Servicer shall certify to the Administrative Agent that Wachovia has executed an amendment to the Wachovia Facilities providing for an extension of the maturity date thereunder without any mandatory payment of principal in connection therewith (whether prior to, concurrent with or subsequent to such amendment).

“ Wachovia Facilities ”: The securitization/warehouse facilities provided under (i) that certain Sale and Servicing Agreement, dated as of April 20, 2004 by and among CapitalSource Funding III LLC, as the

seller, CapitalSource Finance LLC, as the originator and servicer, each of the purchasers and purchaser agents from time to time a party thereto, Wachovia Capital Markets, LLC, as the administrative agent and as the WBNA Agent and Wells Fargo Bank, National Association, as the backup servicer and as the collateral custodian, as such agreement has been and may in the future be amended, modified or supplemented from time to time (including any replacement facility thereto or entered into in connection therewith), (ii) that certain Amended and Restated Sale and Servicing Agreement, by and among CSE QRS Funding I LLC, as the seller, CSE Mortgage LLC, as the originator and as the servicer, each of the purchasers and purchaser agents from time to time party thereto, Wachovia Capital Markets, LLC, as the administrative agent and as the VFCC Agent and Wells Fargo Bank, National Association, as the backup servicer and as the Collateral Custodian, as amended through February 17, 2009 as such agreement has been and may in the future be amended, modified or supplemented from time to time (including any replacement facility thereto or entered into in connection therewith), and (iii) that certain Multicurrency Revolving Facility Agreement, dated as of October 3, 2007 by and among CS Europe Finance Limited and CS UK Finance Limited as the borrowers and guarantors, each of the lenders, lender agents, swingline lender agents and swingline lenders party thereto from time to time, CapitalSource Finance LLC, as the servicer, Wachovia Bank, N.A. as the administrative agent and the security trustee and Wachovia Securities International Ltd., as lead arranger and sole bookrunner, as such agreement has been and may in the future be amended, modified or supplemented from time to time (including any replacement facility thereto or entered into in connection therewith).

“ Warranty Asset ”: Any Asset that fails to satisfy any criteria of the definition of Eligible Asset; provided that (a) notwithstanding the foregoing, for purposes of determining what is a Warranty Asset, the criteria set forth in clauses (1)(c) , (1)(d) , 1(l)(i) , 1(s) (but solely to the extent the criteria in such clause 1(s) relates to any express representation and warranty that an Asset is an Eligible Asset), 1(w) , 1(x) , (1)(y) and clauses (2)(e) and 2(f) (but solely to the extent that the criteria in such clauses 2(e) and 2(f) would not be satisfied as a result of the operation of law or an effective court order in connection with an Insolvency Event) and clause (3)(i) of the definition of Eligible Asset and clauses (viii) and (x) in the definition of Eligible Obligor shall apply only as of the applicable Cut-Off Date of such Asset, and the criteria set forth in clause 2(ee) shall apply only to Acquired Loans first included in the Collateral on or after the Closing Date and (b) with respect to Existing Assets, to the extent that corresponding eligibility criteria to those mentioned in clause (a) above exist in the CS VII Issuer Financing SSA, the limitations referred to in clause (a) shall also apply to those criteria in determining whether such an Asset is a Warranty Asset.

“ Warranty Event ”: As to any Asset, the discovery that as of the related Cut-Off Date there had existed a breach of any representation or warranty relating to such Asset and the continuance of such breach through any applicable determination date or beyond any applicable cure period.

“ Weighted Average Advance Rate ”: For any day on which Advances are outstanding, the weighted average of the Advance Rates with respect to Existing Loan Balances applicable to the Eligible Assets included in the Collateral on such day, weighted according to the proportion of the Aggregate Outstanding Asset Balance each type of Asset with respect to Existing Loan Balances represents; provided that the Weighted Average Advance Rate shall in no event exceed 65%.

“ Weighted Average Advance Reduction Amount ”: An amount in reduction of Advances Outstanding hereunder (when combined with reductions of the “Advances Outstanding” under the 2007-A Facility) such that the quotient (expressed as a percentage) of (x) the Combined Advances Outstanding divided by (y) the sum of (i) the Aggregate Outstanding Asset Balance plus (ii) the 2007-A Aggregate Outstanding Asset Balance would be less than or equal to 50%.

“ Workout Asset ”: A Delinquent Asset or a Charged-Off Asset.

“ Zero-Coupon Bond ”: A bond that, at the time of determination, does not make periodic payments of interest.

           Section 1.2 Other Terms .

     All accounting terms used but not specifically defined herein shall be construed in accordance with GAAP. All terms used in Article 9 of the UCC in the State of New York, and used but not specifically defined herein, are used herein as defined in such Article 9.

           Section 1.3 Computation of Time Periods .

     Unless otherwise stated in this Agreement, in the computation of a period of time from a specified date to a later specified date, the word “from” means “from and including” and the words “to” and “until” each mean “to but excluding.”

           Section 1.4 Interpretation .

     In each Transaction Document, unless a contrary intention appears:

     (i) the singular number includes the plural number and vice versa;

     (ii) reference to any Person includes such Person’s successors and assigns but, if applicable, only if such successors and assigns are permitted by the Transaction Documents;

     (iii) reference to any gender includes each other gender;

     (iv) reference to day or days without further qualification means calendar days;

     (v) reference to any time means New York, New York time;

     (vi) reference to any agreement (including any Transaction Document), document or instrument means such agreement, document or instrument as amended, modified, waived, supplemented, restated or replaced and in effect from time to time in accordance with the terms thereof and, if applicable, the terms of the other Transaction Documents, and reference to any promissory note includes any promissory note that is an extension or renewal thereof or a substitute or replacement therefor; and

     (vii) reference to any Applicable Law means such Applicable Law as amended, modified, codified, replaced or reenacted, in whole or in part, and in effect from time to time, including rules and regulations promulgated thereunder and reference to any Section or other provision of any Applicable Law means that provision of such Applicable Law from time to time in effect and constituting the substantive amendment, modification, codification, replacement or reenactment of such Section or other provision.

ARTICLE II

PURCHASE OF THE VARIABLE FUNDING CERTIFICATES

           Section 2.1 The Variable Funding Certificates .

     (a) On the terms and conditions set forth in the Agreement, Seller delivered to the Administrative Agent at its address set forth on the signature pages of this Agreement (for the benefit of the applicable Purchasers) on the Closing Date, a duly executed variable funding certificate (each such certificate, a “ Variable Funding Certificate ” or “ VFC ”), in substantially the form of Exhibit B . Each Variable Funding Certificate shall evidence an undivided ownership interest (and the Seller does hereby sell, transfer, assign and convey such undivided ownership interest to the Administrative Agent for the benefit of the Purchasers) in the Collateral purchased by a Purchaser in an amount equal, at any time, to the percentage equivalent of a fraction (i) the numerator of which is the Advances outstanding under the applicable VFC on such day, and (ii) the denominator of which is the total aggregate Advances Outstanding on such day. Interest shall accrue, and each VFC shall be payable, as described herein; provided that the aggregate amount outstanding under all VFCs at any one time shall not exceed the Facility Amount.

     (b) On the terms and conditions hereinafter set forth, during the Revolving Period, the Seller may, at its option, request advances of funds under the VFCs (each, an “ Advance ”) and the Issuers may, in their sole discretion, fund such Advance ratably in accordance with their Issuer Purchase Limits (or in such other proportion as the Issuers may mutually agree), and if the Issuers do not fund the entire amount of such Advance, the Liquidity Banks shall fund, ratably in accordance with their Commitments, any portion of such Advance not funded by the Issuers; provided , that in no event shall the Purchasers make any Advance if, after giving effect to such Advance, the aggregate Advances Outstanding hereunder would exceed the lesser of (i) the Facility Amount or (ii) the Maximum Availability. Notwithstanding anything contained in this Section 2.1 or elsewhere in this Agreement to the contrary, (i) no Issuer shall fund any Advance at any time if, after giving effect thereto, the outstanding principal amount of Advances funded by such Issuer would exceed such Issuer’s Issuer Purchase Limit, and (ii) no Liquidity Bank shall be obligated to provide the Administrative Agent or the Seller with aggregate funds in connection with an Advance that would exceed such Liquidity Bank’s Commitment then in effect. Each Advance made by the Purchasers hereunder is subject to the interests of the Hedge Counterparties under Section 2.9(a)(1) and Section 2.10(a)(1) of this Agreement.

     (c) Notwithstanding the foregoing or anything in this Agreement or any other Transaction Document to the contrary, (i) nothing contained in this Agreement or any other Transaction Document shall constitute a commitment by any Issuer to fund any Advance and (ii) the Issuers shall not be liable to make any payments under this Agreement or any other Transaction Document (all liability with respect to which shall be an obligation of the Liquidity Banks or the Administrative Agent).

     (d) The initial Advances hereunder were funded on the Closing Date, and were funded against (i) the Seller’s acquisition from the Issuer (as defined in the Indenture) and assignment hereunder of the Existing Assets, free and clear of the Lien of the Indenture, and (ii) any Additional Assets necessary or desirable for the Seller to include as Assets to be financed hereunder in connection with procuring the release of the Existing Assets from the Indenture by repayment of the CS VII Issuer Financing Obligations secured under the Indenture in full.

     (e) Notwithstanding anything to the contrary contained herein, this Agreement and the VFCs to be issued thereunder shall constitute a single revolving debt facility with a single maturity and Seller shall not take any action under the Agreement that would cause Seller to have outstanding one or more

debt obligations with two or more maturities hereunder. For purposes of this section, debt obligations have “two or more maturities” if they have different stated maturities or if the holders of the debt obligations possess different rights concerning the acceleration of or delay in the maturities of the obligations.

           Section 2.2 [Intentionally Omitted] .

           Section 2.3 Procedures for Advances .

     (a) Each Advance from a Purchaser hereunder shall be effected by the Seller (or the Servicer on its behalf) delivering to the Administrative Agent (with a copy to the Collateral Custodian and the Backup Servicer) a duly completed Borrowing Notice (along with a Borrowing Base Certificate) no later than 2:00 p.m. (New York City, New York time) at least one Business Day prior to the proposed Funding Date; provided that no more than two Advances shall be made in any one calendar week without the Administrative Agent’s prior consent. Each Borrowing Notice (along with a Borrowing Base Certificate) shall (i) specify the desired amount of such Advance, which amount must be at least equal to $250,000, (ii) specify the date of such Advance, (iii) specify the Assets to be financed on such Funding Date (including the appropriate file number and Outstanding Asset Balance for each Asset, and identifying each Rated Retained Security or Loan by type and whether such Loan is a Senior Loan, Senior B-Note Loan, Subordinated Loan, Acquired Loan, or Participation Loan) and (iv) include a representation that all conditions precedent for an Advance described in Article III hereof have been met. Each Borrowing Notice shall be irrevocable.

     Each Issuer shall promptly thereafter notify the Administrative Agent whether such Issuer has determined to make the requested Advance on the terms specified by the Seller, and the Issuers shall notify the Administrative Agent of the funding allocation as between them (if other than proportional to their Issuer Purchase Limits). The Administrative Agent shall promptly thereafter notify the Seller whether the Issuers have determined to make the requested purchase and, if so, whether all of the terms specified by the Seller are acceptable to the Issuers. If the Issuers have determined not to make the entire amount of an Advance requested to be made, the Administrative Agent shall promptly send notice of the proposed Advance to all of the Liquidity Banks concurrently specifying the date of such Advance, the aggregate amount of such Advance to be funded by the Liquidity Banks (which amount shall be equal to the portion of the Advance not funded by the Issuers), and each such Liquidity Bank’s portion thereof (determined ratably in accordance with its respective Commitment).

     (b) On the date of each Advance, the applicable Purchasers shall upon satisfaction of the applicable conditions set forth in Article III , make available to the Seller in same day funds, at such bank or other location reasonably designated by Seller in its Borrowing Notice given pursuant to this Section 2.3 , an aggregate amount equal to the least of (i) the amount requested by the Seller for such Advance, (ii) an amount equal to the Availability on such Funding Date or (iii) the Facility Amount.

     (c) Effective on the date of each Advance pursuant to this Section 2.3 , the Seller hereby sells and assigns to the Administrative Agent, for the benefit of the Purchasers making such Advance, all Assets listed on the attachment to the Borrowing Notice delivered in connection with such Advance, and the Related Security and Collections with respect thereto.

     (d) On each Funding Date, the obligation of each Liquidity Bank to remit its pro rata share of each Advance shall be several from that of each other Liquidity Bank and the failure of any Liquidity Bank to so make such amount available to the Seller shall not relieve any other Liquidity Bank of its obligation hereunder. No Liquidity Bank shall be responsible for the failure of any other Liquidity Bank to make funds available in connection with any Advance.

           Section 2.4 Reduction of the Facility Amount; Mandatory and Optional Repayments; Increase of Commitment .

     (a) The Seller may, upon at least 10 days’ prior written notice (such notice to be received by the Administrative Agent no later than 5:00 p.m. (New York City, New York time) on such day) to the Administrative Agent, terminate in whole or reduce in part the portion of the Facility Amount that exceeds the sum of the Advances Outstanding, accrued Interest, Breakage Costs and Hedge Breakage Costs; provided that each partial reduction of the Facility Amount shall be in an aggregate amount equal to at least $1,000,000. Each notice of reduction or termination pursuant to this Section 2.4(a) shall be irrevocable.

     (b) The Seller may, upon one Business Day’s prior written notice (such notice to be received by the Administrative Agent and each Hedge Counterparty no later than 2:00 p.m. (New York City, New York time) on such day) to the Administrative Agent, reduce the Advances Outstanding by remitting, to the Administrative Agent, for payment to the applicable Purchasers, (i) cash and (ii) instructions to reduce such Advances Outstanding, related accrued Interest, Breakage Costs and Hedge Breakage Costs; provided that no such reduction shall be given effect unless the Seller has complied with the terms of any Hedging Agreement requiring that one or more Hedge Transactions be terminated in whole or in part as the result of any such reduction of the Advances Outstanding, and Seller has paid all Hedge Breakage Costs and any payments owing to the relevant Hedge Counterparty for any such termination. Any reduction of the Advances Outstanding shall be in a minimum amount of $250,000. Any such reduction will occur only if sufficient funds have been remitted to pay all such amounts in the succeeding sentence in full. Upon receipt of such amounts, the Administrative Agent shall apply such amounts first to the pro rata reduction of the Advances Outstanding by paying such amounts to the applicable Purchasers, second to the payment of related accrued Interest on the amount of the Advances Outstanding to be repaid by paying such amounts to the applicable Purchasers, and third to the payment of any Breakage Costs and Hedge Breakage Costs and any other payments owing to the applicable Hedge Counterparty in respect of the termination of any Hedge Transaction; provided , however , if such amounts are received during the Amortization Period, such amounts shall be applied in the order of priority set forth in Section 2.10 . Any notice relating to any prepayment pursuant to this Section 2.4(b) shall be irrevocable.

     (c) If on any day (i) the Administrative Agent, as agent for the Secured Parties, does not own or have a valid and perfected first priority security interest in any of the Collateral or (ii) any Asset which has been represented by the Seller to be an Eligible Asset is later determined not to have been an Eligible Asset as of the related Cut-Off Date, upon the earlier of the Seller’s receipt of notice from the Administrative Agent or the Seller becoming aware thereof and the Seller’s failure to cure such breach within 30 days, the Seller shall be deemed to have received on such day a collection (a “ Deemed Collection ”) of such Asset in full and shall on such day pay to the Administrative Agent, on behalf of the Purchasers and each Hedge Counterparty, an amount equal to (x) the Outstanding Asset Balance of the Asset (calculated without regard to either of the provisos contained in the definition of “Outstanding Asset Balance”) to be applied to the pro rata reduction of the principal of each VFC plus (y) any Breakage Costs and Hedge Breakage Costs and any other payments owing to the applicable Hedge Counterparty in respect of the termination of any Hedge Transaction required as a result of the Deemed Collection and retransfer of the related Asset contemplated by this Section 2.4(c) . In connection with any such Deemed Collection, the Administrative Agent, as agent for the Secured Parties, shall automatically and without further action, be deemed to transfer to the Seller (or any Affiliate of the Seller designated by the Seller), free and clear of any Lien created by the Administrative Agent, all of the right, title and interest of the Administrative Agent, as agent for the Secured Parties, in, to, and under the Asset with respect to which the Administrative Agent has received such Deemed Collection, but without any other representation and warranty of any kind, express or implied.

           Section 2.5 Determination of Interest .

     To the extent any Purchaser’s Interest Rate is determined by reference to the CP Rate, the Administrative Agent shall determine such Purchaser’s CP Rate and the Interest (including unpaid Interest, if any, due and payable on a prior Payment Date) to be paid by the Seller with respect to each Advance, as applicable, on each Payment Date for the related Accrual Period and shall advise the Servicer thereof on or before the third Business Day prior to such Payment Date.

           Section 2.6 Percentage Evidenced by each Variable Funding Certificate .

     The variable percentage ownership interest in the Collateral represented by each VFC shall be initially computed on its date of purchase as set forth in Section 2.1(a) . Thereafter, until the Termination Date, each VFC shall be automatically recomputed (or deemed to be recomputed) on each day prior to the Termination Date as set forth in Section 2.1(a) . The variable percentage ownership interest in the Collateral represented by each VFC as computed (or deemed to be recomputed) as of the close of business on the day immediately preceding the Termination Date shall remain constant at all times on and after the Termination Date. The variable percentage ownership interest in the Collateral represented by each VFC shall become zero when its Advances and Interest have been indefeasibly paid in full.

           Section 2.7 Notations on Variable Funding Certificates .

     The Administrative Agent is hereby authorized to enter on a schedule attached to the VFC a notation (which may be computer generated) with respect to each Advance under a VFC made by the applicable Purchaser of: (a) the date and principal amount thereof, and (b) each repayment of principal thereof, and any such recordation shall constitute prima facie evidence of the accuracy of the information so recorded. The failure of the Administrative Agent to make any such notation on the schedule attached to the VFC shall not limit or otherwise affect the obligation of the Seller to repay the Advances in accordance with their respective terms as set forth herein.

           Section 2.8 Settlement Procedures for Special Reduction Amounts and Optional Sales .

     On the Optional Sale Date (with respect to Optional Sales) and or prior to the Special Reduction Amount Date (with respect to Special Reduction Amounts), the Seller shall remit to the Administrative Agent the Optional Sale Proceeds or Special Reduction Amount, as applicable, for payment to reduce Advances Outstanding, related accrued Interest, Breakage Costs and Hedge Breakage Costs. Upon receipt of such amounts, the Administrative Agent shall apply such amounts first to the pro rata reduction of the Advances Outstanding by paying such amounts to the applicable Purchasers, second to the payment of related accrued Interest on the amount of the Advances Outstanding to be repaid by paying such amounts to the applicable Purchasers, third to the payment of any Breakage Costs and Hedge Breakage Costs and any other payments owing to the applicable Hedge Counterparty in respect of the termination of any Hedge Transaction, and fourth , amounts remaining if any, shall be deposited in the Collection Account for distribution pursuant to Section 2.9 or Section 2.10 , as applicable.

           Section 2.9 Settlement Procedures During the Revolving Period .

     (a) On each Payment Date during the Revolving Period, the Servicer shall direct the Collateral Custodian to pay pursuant to the Monthly Report to the following Persons, from (1) the Collection Account, to the extent of Available Funds, and (2) Servicer Advances received with respect to the immediately preceding Collection Period, the following amounts in the following order of priority:

     (1) pro rata to each Hedge Counterparty, any amounts, (other than any Hedge Breakage Costs and any payments due in respect of the termination of any Hedging Transaction), owing to that Hedge Counterparty under its respective Hedging Agreement in respect of any Hedge Transaction(s), for the payment thereof;

     (2) to the Servicer, in an amount equal to any unreimbursed Servicer Advances, for the payment thereof;

     (3) to the Servicer, in an amount equal to any accrued and unpaid Servicing Fees to the end of the preceding Collection Period, for the payment thereof;

     (4) to the extent not paid for by the Originator, pro rata to the Backup Servicer and the Collateral Custodian, in an amount equal to any accrued and unpaid Backup Servicing Fees, Collateral Custodian Fees and Transition Expenses, for the payment thereof;

     (5) to the Administrative Agent, for the account of the applicable Purchasers pro rata in accordance with the amount of Advances Outstanding hereunder (or portions thereof) held by each Purchaser, in an amount equal to any accrued and unpaid Interest (including Interest payable on any prior Payment Date an