MASTER CREDIT AND SECURITY AGREEMENT

This Master Credit and Security Agreement (the “Agreement” ) is entered into as of February 28, 2006, between Tribeca Lending Corporation, a New York corporation (the “Company” ), having its principal office at Six Harrison Street, New York, New York 10013, and Sky Bank, an Ohio banking corporation (the “Bank” ), having an office at 110 East Main Street, Salineville, Ohio 43945. The Subsidiaries of the Company which receive Company Subsidiary Loans under this Agreement or which have heretofore received Company Subsidiary Loans will also become parties hereto.

WHEREAS, the Company has entered into a certain Warehouse Line of Credit and Security Agreement with Bank originally dated as of September 30, 2003, as amended from time to time and as amended and restated as of October 18, 2005 (the “Warehouse Line of Credit Agreement”) pursuant to which Bank has granted a warehouse line of credit to Company (the “Warehouse Line of Credit”) for the purpose of financing the Company’s origination of first lien residential mortgage loans (the “Warehouse Line Loans”);

Whereas, Bank, the Company and certain Company Subsidiaries have previously entered into loan arrangements, whereby Bank and the Company and each respective Company Subsidiary entered into a separate term loan and security agreement and a promissory note for the purpose of financing the transfer, assignment and sale of the Warehouse Line Loans from the Company to Company Subsidiaries;

Whereas Bank, the Company and each Company Subsidiary which have previously entered into a loan and security agreement, desire to amend and restate each such loan and security agreement;

Whereas, at the request of the Company, Bank will from time to time continue to extended credit to Company Subsidiaries and to additional Subsidiaries of the Company (i) to finance each such Company Subsidiary’s acquisition of Warehouse Line Loans financed by the Company under the Warehouse Line of Credit, or (ii) to consolidate and refinance such extensions of credit made earlier by Bank to a Company Subsidiary, and a list of all such now outstanding extensions of credit from Bank to an existing Company Subsidiary being set forth on Schedule I attached hereto; and

WHEREAS, the Company has accordingly asked Bank, and Bank is willing, to amend and restate each such existing loan and security agreement and to continue to extend credit to Subsidiaries of the Company from time to time to finance the acquisition, assignment, and purchase of the Warehouse Line Loans from the Company; and the parties now desire to set forth herein the terms and conditions to which all such prior extensions of credit shall now be subject, and under which all such future extensions of credit for those purposes shall be made, and the security provided for the repayment thereof;

NOW, THEREFORE, in consideration of the premises and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows:

Section 1.1.Defined Terms . Capitalized terms defined below or elsewhere in this Agreement (including the Exhibits hereto) shall have the following meanings:

“Administrative Services Agreement” has the meaning set forth in Section 10.1 hereof.

“ Administrative Servicing Fee ” means the amounts to be agreed to be paid to Franklin Credit as compensation for administrative services it provides in connection with the Pledged Mortgage Loans pursuant to the Administrative Services Agreement, which amount will be described in the Administrative Services Agreement.

 “Affiliate” has the meaning set forth in Rule 12b-2 of the General Rules and Regulations under the Exchange Act.

“Aggregate Pool Value” means, as of any date of determination, the sum of the Pool Values of each Mortgage Pool as of said date.

“Agreement” means this Master Credit and Security Agreement, either as originally executed or as it may from time to time be supplemented, modified or amended.

“Alternate Base Rate” shall mean, the one (1) month London Interbank Offered Rate (LIBOR) as published in the "MONEY RATES" column of The Wall Street Journal. The interest rate shall be adjusted on the first day of each month based upon the Alternate Base Rate then in effect, or if the first day of the month is not a Business Day, then based upon the Alternate Base Rate in effect on the first Business Day of such month. It is understood and agreed that the Alternate Base Rate is a reference rate only and does not necessarily represent the lowest or best rate actually charged to any customer.

“Bank” has the meaning set forth in the first paragraph of this Agreement.

“BOS” means BoS (USA), Inc., a Delaware corporation., provided, however, any reference to BOS in this Agreement shall only have and take effect if and when the BOS Master Agreement has been entered into by Company and BOS .

“BOS Account” means the account designated the Tribeca-BOS Collateral Account established by Bank, as servicer, for the benefit of BOS under and pursuant to the BOS Master Agreement.

“BOS Master Agreement” means, if and when executed, that certain Master Credit and Security Agreement among BOS, the Company and its Subsidiaries which from time to time become a party thereto, as the same may be amended from time to time.

“ BOS Portfolio Deficiency Amount ” means an amount equal to the amount by which (i) the total amount allocable pursuant to Section 2.5(a)(i) and Section 2.5(a)(ii) of the BOS Master Agreement exceeds (ii) the amount on deposit, prior to such allocations pursuant to Section 2.5(a)(i) and Section 2.5(a)(ii) of the BOS Master Agreement, in the BOS Account.

“Business Day” means any day (excluding Saturday, Sunday and any legal holidays) on which banks in Cleveland, Ohio are generally open for the conduct of their commercial banking business. 

“Collateral” has the meaning set forth in Section 3 hereof.

“Collateral Documents” means all Mortgage Loan Documents evidencing or securing or pertaining to any Pledged Mortgage Loan, whether now existing or hereafter arising, some or all of which may have been previously delivered to Bank by either the Company pursuant to the Warehouse Line of Credit Agreement or by a Company Subsidiary in connection with an existing Company Subsidiary Loan, and being generally described on Exhibit B attached hereto. Each Company Subsidiary obtaining a Company Subsidiary Loan hereunder shall be deemed to have delivered, or re-delivered, as applicable, to Bank hereunder all Collateral Documents evidencing or securing or related to the Pledged Mortgage Loans comprising the Mortgage Pool of Mortgage Loans owned by such Company Subsidiary. The term Collateral Documents shall also include any endorsements and assignments of such Mortgage Loan Documents from the Company to the applicable Company Subsidiary or from any other Company Subsidiary to the applicable Company Subsidiary.

“Commitment” has the meaning set forth in Section 2.1(a) hereof.

“Company” has the meaning set forth in the first paragraph of this Agreement.

“Company Subsidiary” means each Subsidiary of the Company, whether now existing or hereafter organized and created, which becomes a party to this Agreement and which has heretofore received or which hereafter receives a Company Subsidiary Loan.

“ Company Subsidiary Loan” means any of the now existing loans from Bank to a Company Subsidiary which are listed on Schedule I attached hereto, or any loan contemporaneously herewith or hereafter made by Bank to a Company Subsidiary pursuant to this Agreement.

“Company Subsidiary Loan Request” means the current form in use by Bank as set forth in Exhibit A hereto. The Bank shall have the right, on not less than thirty (30) Business Days’ prior written notice to Company, to modify Exhibit A to conform to current legal requirements or Bank practices, and, as so modified, said Exhibits shall be deemed a part hereof.

“ Consolidated ” refers to the consolidation of accounts in accordance with GAAP.

“Corporate Advances” means all customary, reasonable and necessary “out of pocket” costs and expenses incurred in the performance by Company or any subservicer of its servicing obligations with respect to the preservation, restoration and protection of any Pledged Mortgage Loan.

 “Custodian” means the organization which holds Mortgage Loan Documents under any custodial agreement hereafter entered into by Bank, Company and Company Subsidiaries. No Custodial Agreement is currently in effect with respect to the Pledged Mortgage Loans, and, unless otherwise hereafter agreed to by Bank, Company and Company Subsidiaries, all Mortgage Loan Documents will be held by Bank.

“Custodial Agreement ” means any custodial agreement hereafter entered into by Bank, Company and the Company Subsidiaries. No such Custodial Agreement is currently in effect with respect to the Pledged Mortgage Loans.

“ Custodial Fees ” means the amounts(s) to be paid to a Custodian as compensation for the custodial services it provides in connection with the Pledged Mortgage Loans pursuant to the Custodial Agreement, if any, which amount(s), including, if applicable, any portion thereof allocable to the Pledged Mortgage Loans shall be described in such Custodial Agreement.

“Debt” means, with respect to any Person, at any date (a) all indebtedness or other obligations of such Person which, in accordance with GAAP, would be included in determining total liabilities as shown on the liabilities side of a balance sheet of such Person at such date; (b) all indebtedness or other obligations of such Person for borrowed money or for the deferred purchase price of property or services; (c) all indebtedness or other obligations of any other Person for borrowed money or for the deferred purchase price of property or services in respect of which such Person is liable, contingently or otherwise, to pay or advance money or property as guarantor, endorser, or otherwise (except as endorser of negotiable instruments for collection in the ordinary course of business), or which such Person has agreed to purchase or otherwise acquire; and (d) all indebtedness for borrowed money or for the deferred purchase price of property or services secured by a Lien on any property owned or being purchased by such Person (even though such Person has not assumed or otherwise become liable for the payment of such indebtedness).

“Default” means the occurrence of any event or existence of any condition which, but for the giving of notice, the lapse of time, or both, would constitute an Event of Default.

“Escrow Reserves ” With respect to any Pledged Mortgage Loan, the amounts constituting ground rents, taxes, assessments, water rates, sewer rents, municipal charges, mortgage insurance premiums, fire and hazard insurance premiums, condominium charges, and any other payments required to be escrowed by the mortgagor with the mortgagee pursuant to the applicable Mortgage or other Mortgage Loan Document.

“Event of Default” means any of the conditions or events set forth in Section 8.1 hereof.

“Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, and any successor statute.

“FHA” means The Federal Housing Administration of the United States Department of Housing and Urban Development and any successor thereto.

“FHLMC” means The Federal Home Loan Mortgage Corporation and any successor thereto.

“Floating Rate” has the meaning set forth in Section 2.4(a) hereof.

“FNMA” means The Federal National Mortgage Association and any successor thereto.

“Franklin Credit” means Franklin Credit Management Corporation.

“ Franklin Line of Credit ” means the Master Credit and Security Agreement among Sky Bank, Franklin Credit and those subsidiaries of Franklin Credit that now or hereafter are a party thereto.

“GAAP” means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as may be approved by a significant segment of the accounting profession, which are applicable to the circumstances as of the date of determination.

“GNMA” means Government National Mortgage Association or any successor thereto.

“HUD” means the United States Department of Housing and Urban Development or any successor thereto.

“Indemnified Liabilities” has the meaning set forth in Section 9.2 hereof.

“Index” has the meaning set forth in Section 2.4(a) hereof.

“Insurer” means FHA, VA or a private mortgage insurer, as applicable.

“Inter-Creditor Agreement” or “Intercreditor Agreement” means, if and when executed, that certain Inter-Creditor Agreement, dated as of even date herewith, between Bank and BOS, that has been acknowledged and consented to by the Company and the Company Subsidiaries which from time to time become a party hereto. Each Company Subsidiary that becomes a party to this Agreement by executing a counterpart signature page shall also execute a Joinder to the Intercreditor Agreement acknowledging and consenting to the terms and provisions of the Intercreditor Agreement. Neither the Company nor any Company Subsidiary shall be bound by any amendment, restatement or modification to the Intercreditor Agreement, unless the same has been agreed to by the Company.

“Internal Revenue Code” means the Internal Revenue Code of 1986, or any subsequent federal income tax law or laws, as any of the foregoing have been or may from time to time be amended.

“Investor” means a third party financially responsible institution purchasing Mortgage Loans through Company or from a Company Subsidiary pursuant to a Purchase Commitment.

“Lien” means any lien, mortgage, deed of trust, pledge, security interest, charge or encumbrance of any kind, including without limitation any conditional sale or other title retention agreement, any lease in the nature thereof, and any agreement to give any security interest.

“ Loan Documents ” means this Agreement, each Note, each security agreement executed and delivered by any Subsidiary of Company pursuant to Section 3.7 hereof, and any other agreements, instruments or documents now or hereafter executed and delivered pursuant to or in connection with any of the foregoing.

“ Lockbox ” means the post office box opened by Bank pursuant to the Lockbox Terms set forth on Exhibit E attached hereto for the receipt of payments relating to the Collateral.

“Margin Stock” has the meaning assigned to that term in Regulation U of the Board of Governors of the Federal Reserve System as in effect from time to time.

“Mortgage” means  a first-lien mortgage, first lien deed of trust, first lien security deed or similar first lien instrument on improved real property securing a Mortgage Loan .

“Mortgage Loan” means any loan evidenced by a Mortgage Note. A Mortgage Loan, unless otherwise expressly stated herein, means a Residential Mortgage Loan.

  “Mortgage Loan Documents” means the Mortgage, Mortgage Note, credit and closing packages, disclosures, and all other files, records and documents evidencing, securing, guaranteeing or otherwise arising in connection with or relating to any Pledged Mortgage Loan, and including, without limitation, (to the extent applicable) those documents listed on Exhibit B.

“Mortgage Loan Principal Balance” means, as of any date of determination, the outstanding principal balance of such Mortgage Loan as calculated pursuant to the Mortgage Loan Documents.

“ Mortgage Loan Value ” means as of any date of determination, with respect to any Mortgage Loan, the appraised value, at the time of origination, of the mortgaged properties then comprising the security for such Mortgage Loan.

“Mortgage Note” means a note secured by a Mortgage and evidencing a Mortgage Loan.

“Mortgage Pool” means, for each Company Subsidiary that now or hereafter becomes a party to this Agreement by executing a counterpart signature page of this Agreement, the pool of Pledged Mortgage Loans set forth on Exhibit D-1 to the counterpart signature page to be executed by such Company Subsidiary as set forth herein.

  “ Net Worth” means, with respect to Company and its Subsidiaries at any date of determination, (a) Consolidated total assets of Company and its Subsidiaries at such date less (b) the sum of (i) Consolidated total liabilities of Company and its Subsidiaries at such date and (ii) the liquidation value of any redeemable preferred stock of Company and its Subsidiaries at such date, in each case as determined in accordance with GAAP.

“Note” has the meaning set forth in Section 2.3 hereof.

“Notices” has the meaning set forth in Section 11.3 hereof.

“Officer’s Certificate” means a certificate executed on behalf of Company or of a Company Subsidiary by a vice president, cashier or other appropriate officer.

“Permitted Liens” means (i) Liens granted in favor of Bank, and (ii) Liens granted to BOS pursuant to the BOS Master Agreement, provided that any such Lien upon the Collateral is junior and subordinate to the Liens upon the Collateral granted to Bank.

“Person” means and includes natural persons, corporations, limited liability companies, partnerships, joint stock companies, joint ventures, associations, companies, trusts, banks, trust land trusts, business trusts or other organizations, whether or not legal entities, and companies, governmental agencies and political subdivisions thereof.

“Pledged Mortgage Loans” has the meaning set forth in Section 3.1(a) hereof.

“ Pool Value” means, with respect to any Mortgage Pool, as of any date of determination, an amount equal to the sum of the Mortgage Loan Values of each Pledged Mortgage Loan that is included in such Mortgage Pool as of such date, reduced by applicable Administrative Servicing Fees, Custodial Fees and Corporate Advances for such Mortgage Pool.

“ Post-Default Rate ” means in respect of any day (a “ Post-Default Day ”) an Event of Default has occurred and is continuing hereunder, a rate per annum on a 360 day per year basis equal to 2% per annum plus the applicable Floating Rate on such Post-Default Day.

“Predatory Loan” means (a) a“high cost mortgage” as defined in Section 152(a) of the Home Ownership and Equity Protection Act of 1994; (b) a “high cost home loan” or a “predatory loan” within the meaning of any corresponding state or local laws, including but not limited to, the Georgia Fair Lending Act, the New York State Anti-Predatory Lending Law, and the New Jersey Homeownership Security Act; (c) any loan which under any other state or local law or ordinance could result in such loan being deemed to be unenforceable or could result in the refund or recession of all principal and/or interest paid or to be paid under such loan; and (d) any loan which under a state or local law may otherwise subject the originator and/or holder of such loan to civil or criminal sanctions related to the origination, holding, servicing, and/or transfer of such loan.

“ Principal Payment ” means, as of any date of determination, an amount equal to any unpaid principal which is then due and payable under any Note on such date.

“Purchase Commitment” means a written commitment, issued in favor of Company or of a Company Subsidiary by an Investor pursuant to which that Investor commits to purchase one or more Mortgage Loans, or any whole loan purchase agreement by and between a Company Subsidiary and the Investor, governing the terms and conditions of any such purchases.

“Redemption Amount” means with respect to any Mortgage Loan, as of any date of determination, the outstanding principal amount of such Mortgage Loan as of such date.

“Related Loan” means with respect to each Mortgage Pool listed on Exhibit D-1 to any counterpart signature page now or hereafter executed by a Company Subsidiary, the Company Subsidiary Loan made to such Company Subsidiary to which such Mortgage Pool is attributed.

“ Related Mortgage Pool ” means the Mortgage Pool acquired with the proceeds of such Company Subsidiary Loan, as listed on Exhibit D-1 to any counterpart signature page now or hereafter executed by a Company Subsidiary.

“ Restricted Payment ” means any dividend, distribution, loan, advance, guaranty, extension of credit or other payment (whether in cash, securities or other property) to or for the benefit of any Person who holds an equity interest in the Company or any Company Subsidiary, whether or not such interest is evidenced by a security, and any other payment, whether in cash, securities or other property, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any capital stock of the Company or any Company Subsidiary, provided, however, Restricted Payments shall not include Administrative Servicing Fees payable under the Administrative Services Agreement, disbursements to Company pursuant to Section 2.5(a)(vi), or premiums, points and fees from the sale of Pledged Mortgage Loans which have been redeemed pursuant to Section 3.4. 

“Residential Mortgage Loan” means a Mortgage Loan secured by a Mortgage covering improved real property containing a one- to four-family residence.

“ Sky Account ” means the account designated as the “Tribeca-Sky Collateral Account established by Bank pursuant to the Lockbox Terms, and any replacement thereof.

“ Sky Portfolio Deficiency Reimbursement Amount ” means an amount equal to the (i) aggregate amount of all transfers made from the BOS Account to the Sky Account pursuant to Section 2.5(a)(iv) of the BOS Master Agreement, less (ii) the aggregate amount of all transfers made from the Sky Account to the BOS Account pursuant to Section 2.5(a)(iii) of this Agreement.

“ Sky Portfolio Deficiency Reimbursement Obligation ” refers to the obligation of Company and the Company Subsidiaries to reimburse the BOS Account for transfers made from the BOS Account to the Sky Account pursuant to Section 2.5(a)(iv) of the BOS Master Agreement.

“Statement Date” has the meaning set forth in Sections 4.2(d) or 6.1(b)(ii), as applicable.

“Subsidiary” means any corporation, association or other business entity in which more than fifty percent (50%) of the total voting power or shares of stock entitled to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by any Person or one or more of the other Subsidiaries of that Person or a combination thereof.

“ Success Fees ” has the meaning set forth in Section 2.10.

“Underwriting Standards” means Company’s Liberty Loan Underwriting Guidelines dated July 25, 2005, as amended from time to time by Company upon approval of Bank.

“VA” means the Department of Veterans Affairs and any successor thereto.

“ Warehouse Line Loans” means Residential Mortgage Loans originated by Company by financing provided under the Warehouse Line of Credit.

Section 1.2.Other Definitional Provisions . (a)    Accounting terms not otherwise defined herein shall have the meanings given them under GAAP.

(b)   Defined terms may be used in the singular or the plural, as the context requires.

Section 2.1.The Commitment . (a)    Subject to the terms and conditions of this Agreement, including, without limitation Section 2.2 below, and provided no Default has occurred and is continuing, Bank agrees, from time to time during the period from the date hereof to the expiration date of the Commitment as provided in Section 2.6 hereof, to make Company Subsidiary Loans to, or on behalf of, Company Subsidiaries, provided, however, that the total aggregate principal amount which is outstanding at any one time of all such Company Subsidiary Loans shall not exceed the lesser of (i) the aggregate approved principal amount of all Company Subsidiary Loans which have been approved by Bank under this Agreement from time to time, but not less than the aggregate amount of the Warehouse Line of Credit outstanding from time to time which is eligible hereunder for rollover into a Company Subsidiary Loan, or (ii) any regulatory limitations applicable to Bank which are now or hereafter in effect (the “ Commitment ”), and provided further that (w) the principal amount of such Company Subsidiary Loan shall not exceed the principal amount of indebtedness outstanding under the Mortgage Notes in the Related Mortgage Pool, and (x) the total aggregate principal amount of such Company Subsidiary Loan shall not exceed 75% of the Pool Value of the Related Mortgage Pool.

(b)   Company Subsidiary Loans approved by Bank from time to time as provided herein shall be used by Company Subsidiaries solely for the following purposes: (i) financing (including the points and fees charged by Bank in connection with such financing) each such Company Subsidiary’s purchase and acquisition of first mortgage lien Warehouse Line Loans originated by Company under the Warehouse Line of Credit, or (ii) the consolidation and refinancing (including the points and fees charged by Bank in connection with such consolidation and refinancing) of then existing Company Subsidiary Loans made by Bank to one or more Company Subsidiaries.

(c)   All Company Subsidiary Loans outstanding prior to the date of this Agreement for the purpose of funding or financing the purchase of Pledged Mortgage Loans, such loans being listed on Schedule I attached hereto, shall be treated as having been issued under, and shall be subject to the covenants of, this Agreement. The Company shall cause all of its Subsidiaries which have such Company Subsidiary Loans outstanding to Bank to become parties to this Agreement by executing a counterpart signature page in the form of Exhibit D . In the event that the terms of this Agreement shall conflict with the terms of the loan documentation for such a Company Subsidiary Loan, the terms of this Agreement shall prevail, except for interest rate terms, which shall not be affected by the terms of this Agreement, and except that any default under any such loan, which has not been cured or waived, shall remain in effect.

(d)   The Warehouse Line of Credit extended by Bank to Company shall be separate from and shall not be subject to this Agreement except as specifically otherwise provided in this Agreement.

Section 2.2.   Procedures for Obtaining Company Subsidiary Loans. Each Company Subsidiary Loan Request is subject to Bank’s approval. Such Bank approval is subject to the Conditions Precedent set forth in Section 4.2. Before providing final approval and funding any Company Subsidiary Loan, Bank shall have a reasonable amount of time (not less than two (2) Business Days or more than four (4) business days) to examine and verify the Collateral Documents required to be delivered to Bank or to Custodian, as set forth in Section 4.2, and may reject such of them as do not meet the requirements of this Agreement, and/or may reduce the amount of such Company Subsidiary Loan. Bank, in all events, reserves the right to reject any Company Subsidiary Loan Request to finance the acquisition of a Warehouse Line Loan which does not qualify for re-finance hereunder or under the Warehouse Line of Credit Agreement, including, without limitation, any Warehouse Line Loan which is a Predatory Loan. Bank furthermore reserves the right to reject a Company Subsidiary Loan Request if (i) the Mortgage Pool designation related to such Company Subsidiary Loan Request will result in the requested loan having a loan to value ratio in excess of seventy-five percent (75%) (the ratio of the principal balance of the proposed loan to the Pool Value of the proposed Mortgage Pool), or (ii) the initial principal balance of the proposed loan will exceed the aggregate outstanding principal balance of the Mortgage Loans which will comprise the proposed Mortgage Pool.

Section 2.3.Note. Each Company Subsidiary Loan, and the corresponding Company Subsidiary’s obligation to pay the principal of, and interest on such Company Subsidiary Loan, shall hereafter be evidenced by a promissory note of such Company Subsidiary payable to the order of Bank, in substantially the form of Exhibit C attached hereto. All existing promissory notes evidencing Company Subsidiary Loans heretofore granted by Bank to a Company Subsidiary shall remain in full force and effect. The term “Note” or “Notes” shall mean each and all such existing promissory notes evidencing Company Subsidiary Loans, and all promissory notes hereafter executed and delivered by a Company Subsidiary to evidence Company Subsidiary Loans, and shall include all extensions, renewals and modifications thereof, and all substitutions therefor.

Section 2.4.   Interest and Transaction Fees . (a)  Subject to Subsection (b) below, the unpaid principal balance of each Company Subsidiary Loan shall bear interest, payable monthly, on the fifth (5 ^th ) day of each month, from the date of such Company Subsidiary Loan until paid in full, at a floating per annum rate of interest (the “ Floating Rate ”) based upon an index which will be the Federal Home Loan Bank of Cincinnati 30 day advance rate (the “Index”), plus the applicable margin in accordance with the following matrixes:

For Company Subsidiary Loans originated prior to July 1, 2005 and Company Subsidiary Loans which re-finance a Company Subsidiary Loan which originated prior to July 1, 2005

For Company Subsidiary Loans originated on or after July 1, 2005 and Company Subsidiary Loans which re-finance a Company Subsidiary Loan which originated on or after July 1, 2005

The interest rate charged herein shall be adjusted monthly, effective on the first (1 ^st ) day of each month, based upon the Index in effect on the last Business Day of the then prior month. The Federal Home Loan Bank of Cincinnati 30 day advance rate shall mean the highest rate of interest as published daily by Bloomberg under the symbol FHL5LBR1. If the Index becomes unavailable during the term of this Agreement, the interest rate will be based upon such other index which has been mutually agreed to among the Company, Bank and BOS, and in the event that Bank, Company and BOS shall not so agree, the interest rate shall be the Alternate Base Rate. Interest will be calculated on the basis of actual days elapsed over a 360 day year (365/360 basis), and principal and interest payments will be billed monthly and will be due on the fifth day of each month.

(b) If an Event of Default has occurred and is continuing hereunder, Company and Company Subsidiary shall be obligated to pay to Bank interest on the outstanding principal balance of each Company Subsidiary Loan at a rate per annum equal to the Post-Default Rate until such Company Subsidiary Loan is paid in full or such Event of Default is cured or waived by Bank.

(c) At the time of closing of each Company Subsidiary Loan, such Company Subsidiary or Company shall pay Bank a transaction fee equal to one-half of one percent (.50%) of the amount of such Company Subsidiary Loan.

(d) The books and records of Bank, absent manifest error, shall constitute prima facie evidence of the principal balance of each Company Subsidiary Loan and the date and amount of each payment of principal and interest and applicable interest rates and other information with respect thereto.

Section 2.5.   Payments . (a) The Company and each Company Subsidiary which becomes a party to this Agreement shall ensure that any and all payments on the Pledged Mortgage Loans shall be made as specified in Section 3.5, except as otherwise provided in Section 2.9. The Bank shall receive, record and forward to Company or the Company Subsidiary the record of all payments made by Pledged Mortgage Loan obligors in accordance with the Lock Box Terms. So long as no Event of Default shall have occurred and be continuing, Pledged Mortgage Loan payments deposited in the lockbox or otherwise received by Company or any Company Subsidiary shall be deposited into the Sky Account and shall be applied by Bank, on or about the 5 ^th , 12 ^th , 19 ^th and 26 ^th day of each month in the following orders:

  (i) First, all amounts received in respect of each Mortgage Pool shall be applied to the following obligations in the following order:

(ii) Second, any amounts remaining after the allocations set forth in clause 2.5(a)(i) above are applied with respect to each Mortgage Pool shall be aggregated and then applied to the following obligations in the following order, in each case to the extent not applied pursuant to clause 2.5(a)(i) above:

(iii) Third, after the allocations set forth in clause 2.5(a)(ii), an amount equal to the Sky Portfolio Deficiency Reimbursement Amount, if any, shall be deposited by Bank into the BOS Account for application to toward the Sky Portfolio Deficiency Reimbursement Obligation.

(iv) Fourth, after the allocation set forth in clause 2.5(a)(iii), an amount equal to the BOS Portfolio Deficiency Amount, if any, shall be deposited by Bank into the BOS Account.

(v) Fifth, any amount remaining after the allocations set forth in clause 2.5(a)(iv) above shall be applied to pay any other accrued and unpaid sums due to Bank hereunder, including, without limitation, any unpaid Success Fees then due.

(vi)   Sixth, any amounts remaining after the allocations set forth in clause 2.5(a)(v) above shall be applied to pay the principal balance of the Company Subsidiary Loans, applied in the order of origination of the Company Subsidiary Loans (i.e. starting with the oldest Company Subsidiary Loan), provided, however, a portion of such remaining amounts, as determined by Bank from time to time at Bank’s sole discretion, may be allocated and distributed to Company for the benefit of the company Subsidiaries.

(b) If at any time an Event of Default has occurred and is then continuing, the provisions of Section 8.3 shall apply

(c) Subject to the general order of application of funds in the Sky Account set forth in Section 2.5 above, Company or a Company Subsidiary may prepay any Company Subsidiary Loan, in whole or in part at any time and from time to time, without premium or penalty (but subject to the Success Fee), provided, however, that at the time of such prepayment the Company or Company Subsidiary, as the case may be, shall pay all accrued interest on the principal so prepaid; and provided, further, however, that except as otherwise provided in Section 3.4 below, the Pledged Mortgage Loans related to such Company Subsidiary Loan shall continue to be held as Collateral and payments from the Pledged Mortgage Loans shall continue to be applied in accordance with the above toward any remaining Company Subsidiary Loans or any other sums due to Bank hereunder. Notwithstanding the foregoing, upon payoff of a Company Subsidiary Loan through the proceeds of the BOS Master Agreement, Bank will release possession of the Collateral Documents for the Related Mortgage Pool securing such paid off Company Subsidiary Loan to BOS, or to the BOS Custodian under the BOS Master Agreement, and Bank’s security interest in the Pledged Mortgage Loans comprising such Related Mortgage Pool shall be subordinate to the security interest in such Pledged Mortgage Loans granted to BOS under the BOS Master Agreement, as set forth in the Intercreditor Agreement.

Section 2.6.   Expiration and/or Termination of Commitment . (a)    Unless terminated earlier as permitted hereunder, the Commitment shall expire of its own term, and without the necessity of action by Bank, two (2) years following the date of execution of this Agreemen t . No such expiration, however, shall in and of itself operate to accelerate the due date of any outstanding Company Subsidiary Loan, or otherwise terminate the obligations, terms and covenants herein with respect to any then outstanding Company Subsidiary Loans.

(b)   Either party shall have the right, without cause, at any time to terminate Bank’s Commitment on not less than six (6) months’ prior written notice to the other party. No such termination, however, shall in and of itself operate to accelerate the due date of any outstanding Company Subsidiary Loan, or otherwise terminate the obligations, terms and covenants herein with respect to any then outstanding Company Subsidiary Loans or with respect to then existing Warehouse Line Loans eligible for refinancing under this Agreement.

(c)   The Bank shall, furthermore, have the right to terminate the Commitment upon or following the occurrence of an Event of Default as specified in Section 8. No such termination, however, shall in and of itself operate to accelerate the due date of any outstanding Company Subsidiary Loan (other than the occurrence of an Event of Default), or otherwise terminate the obligations, terms and covenants herein with respect to any then outstanding Company Subsidiary Loans.

    (d)   The Bank shall have the right from time to time and in its sole discretion, to extend the term of this Agreement with prior written agreement with Company and each Company Subsidiary. The length of any such extension shall also be determined in Bank’s sole discretion. Such extension may be made subject to the renegotiation of the terms hereunder and to any other such conditions as Bank and/or Company may deem necessary. Under no circumstances shall such an extension by Bank be interpreted or construed as Bank’s waiver, release or forfeiture of any of its rights, entitlements or interests created hereunder. The Company and each Company Subsidiary acknowledges and understands that Bank is under no obligation whatsoever to extend the term of this Agreement beyond its expiration date as originally stated in this Agreement.

Section 2.7.Method of Making Payments . Except as otherwise specifically provided herein, all payments under a Note shall be received by Bank on the date when due and shall be made in lawful money of the United States of America in immediately available funds at the office of Bank, or such other place as Bank from time to time shall designate. Whenever any payment to be made under a Note shall be stated to be due on a day which is not a Business Day, the due date thereof shall be extended to the next succeeding Business Day, and, with respect to payments of principal, the interest thereon shall be payable at the applicable rate during such extension. Funds received by Bank after 4:00 p.m. New York City time on a Business Day shall be deemed to have been paid on the next succeeding Business Day. On or before 12:00 p.m., New York City time on the date of each payment to Bank, Company shall provide Bank with a spread sheet, in form and detail agreed to by Bank and Company, showing the application of each payment.

Section 2.8.Net Payments . All payments with respect to any Company Subsidiary Loan shall be made without offset or counterclaim and free from any present or future taxes, levies, imports, duties or other similar charges of whatsoever nature imposed by any government or any political subdivision or taxing authority hereof, other than any taxes on or measured by the net income of Bank.

Section 2.9.Direct Payments. Any and all payments received by Company or a Company Subsidiary in connection with Collateral shall be deemed to have been delivered in trust for the benefit of Bank, and unless an Event of Default shall have occurred and be continuing, shall be promptly delivered to the Lockbox for application in accordance with Section 2.5, or if an Event of Default has occurred and is continuing, shall be delivered to Bank or as may otherwise be directed by Bank. Notwithstanding the forgoing, absent an Event of Default, premiums, points and profits received by the Company or a Company Subsidiary from the sale of Pledged Mortgage Loans pursuant to Section 3.4 may be retained by Company and/or Company Subsidiary and do not require application as provided in Section 2.5 and are not required to be delivered to the Lockbox.

Section 2.10. Success Fees. After payoff of each Company Subsidiary Loan, Company or such Company Subsidiary shall pay to Bank a “Success Fee” in an amount equal to fifty percent (50%) of the remaining payments which are subsequently paid under the then remaining Pledged Mortgage Loans comprising the Related Mortgage Pool for such paid off Company Subsidiary Loan, provided, however, that the amount of any Success Fees in respect of any such paid off Company Subsidiary Loan shall not exceed one-half of one percent (0.50%) of the original principal balance of such paid off Company Subsidiary Loan, provided further, no Success Fee shall be due hereunder for any Company Subsidiary Loan which is paid off through the proceeds of the BOS Master Agreement.

Section 2.11.   Mandatory Prepayments of Company Subsidiary Loans.

(a) In furtherance of, and not in any way in limitation of any other obligation of the Company or any Company Subsidiary set forth in this Agreement, (i) if the Company or any Company Subsidiary shall fail to deliver any Collateral Documents relating to any Pledged Mortgage Loan to Bank or Custodian, as the case may be, within sixty (60) days after written notice thereof from Bank or Custodian, or (ii) if the Company or any Company Subsidiary shall fail to replace any Collateral Document not compliant with the requirements of this Agreement with a corrected or completed Collateral Document compliant with such requirements, or to replace any Warehouse Line Loan which is not an Eligible Warehouse Line with an Eligible Warehouse Line Loan, within sixty (60) days after discovery of such noncompliance or ineligibility, or (iii) if any legal action or complaint is filed, including, without limitation a legal action by or on behalf of a Federal, State, or County regulator or agency, or by a local municipality claiming that any Pledged Mortgage Loan is a Predatory Loan, or if there is notification by a Federal, State, or County regulator or agency, or by a local municipality that such a legal action will be imminently filed, or if there is any determination by the regulators or auditors of either Bank or Company that any Pledged Mortgage Loan is a Predatory Loan; then in each of the foregoing cases, the applicable Company Subsidiary shall prepay the Related Loan in an amount not less than Redemption Amount of the affected Pledged Mortgage Loan; provided , however , that in the case of (iii) above, such prepayment need not be made if and so long as the defect or condition causing such Pledged Mortgage Loan to be considered a Predatory Loan is curable and the Company and/or Company Subsidiary takes appropriate action to cure such defect and diligently pursues such curative action to completion and/or with respect to a legal action or complaint, so long as the Company or such Company Subsidiary contests, in good faith, any such legal action or claim by proper proceedings which are diligently pursued. Following receipt of any Redemption Amount pursuant to this Section 2.11(a), provided that the outstanding principal amount of the Related Loan shall not (after giving effect to such release) exceed 75% of the Pool Value of the Related Mortgage Pool, Bank shall release its security interest in and lien upon the redeemed Mortgage Loan.

(b)   In the event BOS shall receive any “Redemption Amount” (as defined in the BOS Master Agreement) pursuant to Section 2.11 of the BOS Master Agreement, and in connection therewith shall release its security interest in and lien upon any redeemed BOS Pledged Mortgage Loan, Bank shall, contemporaneously with the release by BOS, release its secondary security interest an lien thereon.

(c)   In the In the event of any redemption of Pledged Mortgage Loans pursuant to Section 3.4, the applicable Company Subsidiary shall prepay the principal amount of the Related Loan, contemporaneously with the consummation of such redemption, in an amount not less than the sum of the Redemption Amounts of the Pledged Mortgage Loans so redeemed.

Section 3.1.   Assignments and Grants of Security Interest by Company and Company Subsidiary . As security for (i) the payment of the Note made by it and the performance of all of such Company Subsidiary’s obligations under this Agreement, and (ii) the obligations of any other Company Subsidiary, under that other Company Subsidiary’s Note and under this Agreement, whether such other Company Subsidiary is now existing or is hereafter created, and whether such other Company Subsidiary’s Loan was made prior to or after the Company Subsidiary Loan to the Company Subsidiary granting this security interest, and (iii) all other now existing or hereafter arising obligations of the Company to Bank under this Agreement, Company does hereby, each Company Subsidiary which contemporaneously herewith becomes a party to this Agreement does hereby, and each Company Subsidiary which contemporaneously herewith or hereafter becomes a party to this Agreement shall, by executing a counterpart signature page to this Agreement thereby, grant and convey to Bank a security interest in all rights, titles and interests of Company and the Company Subsidiary, respectively, in and to the following described property (collectively, the “Collateral”), and each Company Subsidiary which becomes a party hereto contemporaneously herewith does hereby confirm and reaffirm its prior grant and conveyance to Bank of a security interest in all of its right, title, and interest in the following described Collateral:  

(a)   All Mortgage Loans, including, without limitation, all Mortgage Notes and Mortgages evidencing or securing such Mortgage Loans and all other related Mortgage Loan Documents which from time to time are delivered, or caused to be delivered, or which heretofore have been delivered to Bank (including delivery to a third party on behalf of Bank) pursuant hereto or in respect of which a Company Subsidiary Loan has been made by Bank or which is hereafter made by Bank hereunder (the “Pledged Mortgage Loans” ); each Company Subsidiary which has obtained, is obtaining, or hereafter obtains a Company Subsidiary Loan shall deliver a schedule, in form and detail acceptable to Bank listing the Mortgage Loans comprising the Mortgage Pool purchased from the proceeds of such Company Subsidiary Loan and pledged hereunder, which schedule shall be attached as Exhibit D-1 to each Company Subsidiary’s counterpart signature page to this Agreement, and shall be deemed to be a part of this Agreement.

(b)   All mortgage insurance and all commitments issued by Insurers to insure or guarantee any Pledged Mortgage Loans; and all personal property, contract rights, servicing and servicing fees and income, accounts and general intangibles of whatsoever kind relating to the Pledged Mortgage Loans, said Insurer commitments and the Purchase Commitments, and all other documents or instruments delivered to Bank in respect of the Pledged Mortgage Loans, including, without limitation, the right to receive all insurance proceeds and condemnation awards which may be payable in respect of the premises encumbered by any Pledged Mortgage Loan;

(c)   All right, title and interest of Company and/or the Company Subsidiary in and to all files, surveys, certificates, correspondence, appraisals, computer programs, tapes, discs, cards, accounting records, information and data of Company and/or the Company Subsidiary relating to the Pledged Mortgage Loans;

(d)   All property of Company and/or the Company Subsidiary, in any form or capacity now or at any time hereafter in the possession or direct or indirect control of Bank relating to the Pledged Mortgage Loans (including possession by a parent company, affiliate or subsidiary of Bank) or any third party on behalf of Bank relating to the Pledged Mortgage Loans;

(e)   The Company and the Company Subsidiary’s rights (but not any obligations or liabilities of Company or the Company Subsidiary) under all Purchase Commitments now held or hereafter acquired by Company and/or the Company Subsidiary covering Pledged Mortgage Loans and all proceeds resulting from the sale of Pledged Mortgage Loans to Investors pursuant thereto;

(f)   All rights (but not any obligations or liabilities) of Company and of the Company Subsidiary under the Administrative Services Agreement;

(g)   All rights (but not any obligations or liabilities) of the Company Subsidiary under the purchase agreement or other sale or assignment agreement pursuant to which any Warehouse Line Loans constituting Pledged Mortgage Loans were sold, assigned or otherwise transferred by the Company to such Company Subsidiary;

(h)   All rights, title and interest in and to the Sky Account and the Lockbox, and

(i)   All replacements, products and proceeds of any and all of the foregoing (provided however, premiums or profits made on the sale of Pledged Mortgage Loans which have been redeemed pursuant to Section 3.4 shall be kept by Company).

Without limiting the foregoing, it is the express intention of Company, and of each Company Subsidiary that now or hereafter becomes a party to this Agreement, that the security interest granted above is and shall be a continuing security interest covering all now present (or then present), and all future obligations of Company to Bank hereunder or arising hereunder; and all now present (or then present), and all future obligations of each and every Company Subsidiary to Bank hereunder or arising hereunder, and that the security interests granted herein by Company and each Company Subsidiary shall remain in effect until all indebtedness secured hereby has been paid in full and the Commitment has expired or has been otherwise terminated.

Upon the request of Bank, Company and the Company Subsidiaries shall execute any further document or instrument reasonably requested by Bank to further evidence or effectuate the assignments and security interests set forth in this Section. Furthermore, Company and the Company Subsidiaries (a) hereby authorize Bank to sign (if required) and file financing statements at any time with respect to any of the Collateral, without such financing statements being executed by, or on behalf of, Company or the Company Subsidiaries, (b) shall, at any time on request of Bank, execute or cause to be executed financing statements in respect of any Collateral and (c) shall reasonably cooperate to provide any information reasonably required by Bank in connection with the filing of financing statements with respect to the Collateral. The Company and the Company Subsidiaries agree to pay all filing fees, including fees for filing amendments and continuation statements in connection with such financing statements, and to reimburse Bank for all costs incurred in connection therewith.

Section 3.2 Reserved.

Section 3.3.Reserved.

Section 3.4.   Right of Redemption from Pledge - Sale to Investor or Syndication Transaction . Provided no Default or Event of Default has occurred and is continuing, Company and/or Company Subsidiary may redeem Pledged Mortgage Loans from the security interest created under this Agreement by selling the same to an Investor provided that Bank shall have determined that (i) the aggregate principal amount of Company Subsidiary Loans outstanding hereunder will be less than seventy-five percent (75%) of the Aggregate Pool Value (after giving effect to such redemption), (ii) that the projected cash flow of any affected Mortgage Pool (after giving effect to such redemption) will adequately service the Related Loan, and (iii) the sum of the Redemption Amounts of the Pledged Mortgage Loans shall not exceed ten percent (10%) of aggregate total principal amount of all Mortgage Loans sold to such Investor contemporaneously with such redemption, and provided, further, in any event, Pledged Mortgage Loans shall only be redeemed from a Mortgage Pool which has been mutually agreed to by Bank and Company. Each Company Subsidiary shall provide Bank with not less than five (5) Business Days advance written notice of any proposed redemption. In the event Bank shall approve such redemption, such redemption shall be effected by paying or causing Investor to pay to the Sky Account in cash the Redemption Amount for such redeemed Pledged Mortgage Loans, for application in accordance with Section 2.5.

Section 3.5. Collection and Servicing Rights. (a) Unless written notice to the contrary is provided from Bank to Company, the Lockbox, in accordance with the terms of the Lock Box Terms shall be utilized by Company Subsidiary for the receiving, collecting, and processing of all sums payable to the Company Subsidiary in respect of the Collateral. Under that Lock Box Terms, Bank shall be entitled to receive all sums payable to the Company Subsidiary in respect of the Collateral (except as otherwise provided in the Intercreditor Agreement) for deposit into the Sky Account. All amounts payable to the Company Subsidiary for the purchase by any Investor under a Purchase Commitment of any Pledged Mortgage Loans shall be deposited into the Sky Account. The Company Subsidiary shall instruct each Pledged Mortgage Loan obligor to direct all payments due under the Pledged Mortgage Loans, and shall direct each Investor to pay the amounts payable for the purchase of such Pledged Mortgage Loans, directly to the Lockbox address at Bank. Subject to the terms and provisions of the Inter-Creditor Agreement, following the occurrence of any Event of Default, Bank may, at any time thereafter, upon written notice be entitled to service, receive and collect all sums payable to the Company Subsidiary in respect of the Pledged Mortgage Loans, and in such case: (i) Bank in its discretion may, in its own name or in the name of the Company Subsidiary or otherwise, demand, sue for, collect or receive any money or property at any time payable or receivable on account of or in exchange for any of the Pledged Mortgage Loans, but shall be under no obligation to do so; and (ii) except as otherwise provided herein and except as may be otherwise provided in the Inter-Creditor Agreement, all amounts so received and collected by Bank shall be held by it as part of the Collateral.

(b)   In the event of any conflict between the terms of the Lock Box Terms and the terms of the Administrative Services Agreement, the Lock Box Terms shall prevail. The Bank shall have the right on not less than thirty (30) days prior notice to Company and each Company Subsidiary to reasonably modify the Lock Box Terms to conform to then current Bank practices upon mutual agreement of Company, not to be unreasonably delayed, and/or banking regulations.

Section 3.6.   Return of Collateral . If no Company Subsidiary Loans, interest or other amounts evidenced by any Note or due under a Company Subsidiary Loan or under this Agreement shall be outstanding and unpaid, and all other indebtedness of the Company or the Company Subsidiaries to Bank pursuant to this Agreement and the Notes, whether now existing or hereafter arising, has been paid and satisfied in full, Bank shall notify BOS thereof and promptly deliver or release all Collateral in its possession or in the possession of the Custodian in accordance with the terms of the Intercreditor Agreement, provided, further however, if BOS shall notify Bank that it no longer has an interest in the Collateral, Bank shall promptly deliver or release all Collateral in its possession to Company or to the Company Subsidiaries, as appropriate. In such event, the Bank shall also execute and deliver such assignments and other instruments and documents reasonably requested by Company or by the Company Subsidiaries to vest title in the Collateral to Company or the Company Subsidiaries, as appropriate. The timely receipt of Company or of Company Subsidiaries, as appropriate, for any Collateral released or delivered pursuant to any provision of this Agreement shall be a complete and full acquittance for the Collateral so returned, and Bank shall hereafter be discharged from any liability or responsibility therefor.

Section 3.7.Cross - Collateralization to BOS Master Agreement .

(a)   In consideration for (i) the benefits received and receivable by Company and its Company Subsidiaries from Bank under this Agreement, (ii) the benefits received and receivable by Company and its applicable Subsidiaries under the BOS Master Agreement and (iii) Bank’s consent to a second priority security interest and lien on the Collateral in favor of BOS to secure the obligations of Company and its applicable Subsidiaries to BOS under the BOS Master Agreement, Company hereby grants, and shall cause each Subsidiary which now or hereafter becomes a party to the BOS Master Agreement to grant, a security interest and lien (junior to the security interest and lien in favor of BOS in accordance with the terms of the Intercreditor Agreement) upon all collateral pledged or pledgable to BOS under the BOS Master Agreement as additional security for the obligations of Company and its Company Subsidiaries to Bank under this Agreement and the Notes. To effectuate the foregoing, Company and each Subsidiary which contemporaneously herewith or hereafter becomes a party to the BOS Master Agreement shall execute and deliver in favor of Bank a Supplemental Security Agreement in the form attached hereto as Exhibit F, and the Company shall cause each additional Subsidiary from time to time thereafter becomes a party to the BOS Master Agreement to execute and deliver in favor of Bank on the date that such Subsidiary becomes a party thereto a joinder to such Supplemental Security Agreement.

(b)   In consideration for (i) the benefits received and receivable by Bank from the grant by Company and its applicable Subsidiaries under the BOS Master Agreement of a priority security interest and lien in favor of Bank (junior to the security interest and lien in favor of BOS in accordance with the terms of the Intercreditor Agreement) upon all collateral pledged or pledgable to BOS under the BOS Master Agreement as additional security for the obligations of Company and its Company Subsidiaries to Bank under this Agreement, and (ii) the benefits received and receivable by Bank from the consent of BOS to the grant of that second priority security interest and lien in favor of Bank upon all collateral pledged or pledgable to BOS under the BOS Master Agreement, Bank hereby consents, subject to the terms and provisions of the Intercreditor Agreement, to the grant by Company and by each Company Subsidiary which now or hereafter becomes a party to this Agreement of a second priority security interest and lien in favor of BOS upon all Collateral under this Agreement as additional security for the obligations of Company and its applicable Subsidiaries to BOS under the BOS Master Agreement.

Section 4.1.Effectiveness of Agreements This Agreement shall become effective when each of following conditions has been satisfied to the satisfaction of Bank:

(a) The Company shall have executed and delivered to Bank this Agreement, and each Company Subsidiary which heretofore has received or contemporaneously herewith or hereafter receives a Company Subsidiary Loan shall have executed and delivered to Bank a counterparty signature page to this Agreement.

Section 4.2.   Relating to a Company Subsidiary Loan . The obligation of Bank to fund an approved Company Subsidiary Loan is subject to (i) the receipt by Bank of the following documents, all of which must be satisfactory in form and content to Bank in its reasonable discretion, and (ii) the satisfaction of the following conditions precedent:

Section 4.3. Acceptance of Proceeds. Acceptance of the proceeds of any requested Company Subsidiary Loan by a Company Subsidiary shall be deemed a representation by Company and such Company Subsidiary that all conditions set forth in Section 4.2 hereof shall have been satisfied as of the date of such Company Subsidiary Loan.

Section 5.1.   By Company. In order to induce Bank to enter into this Agreement and make each Company Subsidiary Loan, Company hereby represents and warrants to Bank, as of the date of this Agreement and as of the date of each Company Subsidiary Loan Request and of each Company Subsidiary Loan, that:

(a)   Organization; Good Standing . The Company is a corporation duly organized, validly existing, and in good standing under the laws of the State of New York and is duly registered to do business and is in good standing under the laws of the State of New York, has the full legal power and authority to own its property and to carry on its business as currently conducted, and is duly qualified as a foreign corporation to do business in and is in good standing in each jurisdiction in which the transaction of its business makes such qualification necessary, except in jurisdictions, if any, where a failure to be in good standing has no material adverse effect on the business, operations, assets or financial condition of Company.

(b)   Authorization and Enforceability . The Company has the power and authority to execute, deliver and perform this Agreement and all other documents contemplated hereby or thereby. The execution, delivery and performance by Company of this Agreement and all other documents contemplated hereby or thereby, have been duly and validly authorized by all necessary corporate action on the part of Company (none of which actions have been modified or rescinded, and all of which actions are in full force and effect) and do not and will not conflict with or violate any provision of law or of the articles of organization or bylaws of Company, conflict with or result in a breach of or constitute a default or require any consent under, or result in the creation of any Lien upon any property or assets of Company (other than Permitted Liens), or result in or require the acceleration of any indebtedness of Company pursuant to any agreement, instrument or indenture to which Company is a party or by which Company or its property may be bound or affected. This Agreement and all other documents contemplated hereby or thereby constitute legal, valid, and binding obligations of Company enforceable in accordance with their respective terms, except as limited by bankruptcy, insolvency or other similar laws affecting the enforcement of creditors’ rights and by general principles of equity.

(c) Approvals . The execution and delivery of this Agreement and all other documents contemplated hereby or thereby and the performance of Company’s obligations hereunder and thereunder do not require any license, consent, approval or other action of any state or federal agency or governmental or regulatory authority.

(d) Financial Condition . The balance sheet of Company as at the Statement Date, and the related statements of income and cash flows for the fiscal year ended on the Statement Date, heretofore furnished to Bank, fairly present the financial condition of Company as at the Statement Date and the results of its operations for the fiscal period ended on the Statement Date. The Company had, on the Statement Date, no known liabilities, direct or indirect, fixed or contingent, matured or unmatured, or liabilities for taxes, long-term leases or unusual forward or long-term commitments not disclosed by, or reserved against in, said balance sheet and related statements, except as heretofore disclosed to Bank in writing, and except for Bank’s extension(s) of credit to Company and its Subsidiaries. Except for financial statements prepared for interim periods between the fiscal year-end, all financial statements were prepared in accordance with GAAP applied on a consistent basis throughout the periods involved. Since the Statement Date, there has been no material adverse change in the business, operations, assets or financial condition of Company, nor is Company aware of any state of facts which (with or without notice or lapse of time or both) could reasonably be expected to result in any such material adverse change.

(e)   Litigation . There are no actions, claims, suits or proceedings pending, or to the knowledge of Company, threatened against or affecting Company in any court or before any arbitrator or before any government commission, board, bureau or other administrative agency which may reasonably be expected to result in any material and adverse change in the business, operations, assets, licenses, qualifications or financial condition of Company.

(f)   Compliance with Laws . The Company, to the best of its knowledge, is not in violation of any provision of any law, or of any judgment, award, rule, regulation, order, decree, writ or injunction of any court or public regulatory body or authority which might have a material adverse effect on the business, operations, assets or financial condition, of Company.

(g)   Regulation U . No part of the proceeds of any Company Subsidiary Loans made hereunder will be used to purchase or carry any Margin Stock or to extend credit to others for the purpose of purchasing or carrying any Margin Stock.

(h)   Investment Company Act . The Company is not an “investment company,” or a company controlled by an “investment company,” within the meaning of the Investment Company Act of 1940, as amended.

(i)   Payment of Taxes . The Company has filed or caused to be filed all federal, state, and local income, excise, property and other tax returns with respect to the operations of Company, which are required to be filed, all such returns are true and correct in all material respects, and Company has paid or caused to be paid all taxes as shown on such returns or on any assessment to the extent that such taxes have become due, except in cases where Company has disputed in good faith the amount of said taxes, and pursuant to which adequate reserves have been established if required by GAAP.

(j)   Agreements . The Company is not a party to any agreement, instrument or indenture or subject to any restriction materially and adversely affecting its business, operations, assets or financial condition, except as disclosed in the financial statements described in Section 5.1(d) hereof. The Company is not in default in the performance, observance or fulfillment of any of the obligations, covenants or conditions contained in any agreement, instrument, or indenture which default could reasonably be expected to have a material adverse effect on the business, operations, properties or financial condition of Company. No holder of any indebtedness of Company has given notice of any asserted default thereunder, and no liquidation or dissolution of Company and no receivership, insolvency, bankruptcy, reorganization or other similar proceedings relative to Company or any of its properties is pending, or to the knowledge of Company, threatened.

(k)   Title to Properties . The Company or the applicable Company Subsidiary has good, valid, insurable (in the case of real property) and marketable title to all material portions of its properties and assets (whether real or personal, tangible or intangible) reflected on the financial statements described in Section 5.1(d) hereof, and all such properties and assets are free and clear of all Liens except as disclosed in such financial statements.

(l)   Reserved .

(m)   Eligibility . The Company has and shall maintain in good standing all state and local permits, licenses, approvals, registrations and qualifications which are required in order to permit Company to conduct its business, in all material manners, as presently conducted, and which if not maintained in good standing could materially and adversely affect Company’s business, operations, assets, or financial condition or which could materially and adversely impair the ability of Company to perform its obligation hereunder.

Section 5.2. By the Company Subsidiary. In order to induce Bank to make a Company Subsidiary Loan, each Company Subsidiary does represent and warrant to Bank, as of the date of each Company Subsidiary Loan Request and each Company Subsidiary Loan, that:

(a)   Organization; Good Standing; Subsidiaries . Such Company Subsidiary is a duly organized, validly existing and in good standing under the laws of the state of its jurisdiction of incorporation, and is duly registered to do business in and is in good standing under the laws of the state of its jurisdiction of incorporation, and has the full legal power and authority to own its property and to carry on its business as currently conducted, and is duly qualified to do business as a foreign corporation and is in good standing in each jurisdiction in which the transaction of its business makes such qualification necessary, except in jurisdictions, if any, where a failure to be in good standing has no material adverse effect on the business, operations, assets or financial condition of the Company Subsidiary. Such Company Subsidiary has no Subsidiaries.

(b)   Authorization and Enforceability . Such Company Subsidiary has the power and authority to execute, deliver and perform this Agreement, and all other documents contemplated hereby and thereby. The execution, delivery and performance by such Company Subsidiary of the Note, this Agreement and all other documents contemplated hereby and thereby and the borrowing of any Company Subsidiary Loan under this Agreement, have been duly and validly authorized by all necessary corporate action on the part of such Company Subsidiary (none of which actions have been modified or rescinded, and all of which actions are in full force and effect) and do not and will not conflict with or violate any provision of law or of the articles of organization, bylaws or operating agreement of such Company Subsidiary, conflict with or result in a breach of or constitute a default or require any consent under, or result in the creation of any Lien upon any property or assets of such Company Subsidiary (other than Permitted Liens), or result in or require the acceleration of any indebtedness of such Company Subsidiary pursuant to any agreement, instrument or indenture to which such Company Subsidiary is a party or by which such Company Subsidiary or its property may be bound or affected. This Agreement, and all other documents contemplated hereby constitute legal, valid, and binding obligations of such Company Subsidiary enforceable in accordance with their respective terms, except as limited by bankruptcy, insolvency or other similar laws affecting the enforcement of creditors’ rights and by general principles of equity.

(c)   Approvals . The execution and delivery of the Note, this Agreement, and all other documents contemplated hereby and thereby and the performance of such Company Subsidiary’s obligations hereunder and thereunder do not require any license, consent, approval or other action of any state or federal agency or governmental or regulatory authority.

(d)   Default There exists no Default or Event of Default and all representations and warranties made by Company and each Company Subsidiary herein or in any Note or in any other document delivered by Company and each Company Subsidiary in connection herewith or therewith are true and correct.

    (e)   Litigation . There are no actions, claims, suits or proceedings pending, or to the knowledge of such Company Subsidiary, threatened against or affecting such Company Subsidiary in any court or before any arbitrator or before any government commission, board, bureau or other administrative agency which may reasonably be expected to result in any material and adverse change in the business, operations, assets, licenses, qualifications or financial condition of such Company Subsidiary.

(f)   Compliance with Laws . The Company Subsidiary, to the best of its knowledge, is not in violation of any provision of any law, or of any judgment, award, rule, regulation, order, decree, writ or injunction of any court or public regulatory body or authority which might have a material adverse effect on the business, operations, assets or financial condition, of such Company Subsidiary.

(g)   Regulation U . No part of the proceeds of any Company Subsidiary Loan will be used to purchase or carry any Margin Stock or to extend credit to others for the purpose of purchasing or carrying any Margin Stock.

(h)   Investment Company Act . Such Company Subsidiary is not an “investment company,” or a company controlled by an “investment company,” within the meaning of the Investment Company Act of 1940, as amended.

(i)   Payment of Taxes . Such Company Subsidiary has, to the best of its knowledge, filed or caused to be filed all federal, state, and local income, excise, property and other tax returns with respect to the operations of such Company Subsidiary, which, to the best knowledge of such Company Subsidiary, are required to be filed, all such returns are true and correct in all material respects, and such Company Subsidiary has paid or caused to be paid all taxes as shown on such returns or on any assessment to the extent that such taxes have become due, except in cases where such Company Subsidiary has disputed in good faith the amount of said taxes, and pursuant to which adequate reserves have been established if required by GAAP .

(j)   Agreements . Such Company Subsidiary is not a party to any agreement, instrument or indenture or subject to any restriction materially and adversely affecting its business, operations, assets or financial condition, except as disclosed in the financial statements described in Section 5.1(d). Such Company Subsidiary is not i