Note 8 – Borrowings

At March 31, 2013 and December 31, 2012, the Company had borrowings outstanding under the Company’s master repurchase agreement entered into with JPMorgan Chase Bank, N.A. (“JPMorgan”) (the “JPMorgan Facility”) and the Wells Facility. At March 31, 2013 and December 31, 2012, the Company’s borrowings had the following debt balances, weighted average maturities and interest rates:


	March 31, 2013								December 31, 2012
	Debt Balance		Weighted Average Remaining Maturity			Weighted Average Rate			Debt Balance		Weighted Average Remaining Maturity			Weighted Average Rate
Wells Facility borrowings	$	211,941		1.3 years	*		1.4	%	$	225,155		1.1 years	*		1.8	%		**
JPMorgan Facility borrowings		3		1.8 years	*		2.7	%		3		5 days			2.7	%	L+250

Total borrowings	$	211,944		1.3 years			1.4	%	$	225,158		1.1 years			1.8	%

*	Assumes extension options on the Wells Facility and JPMorgan Facility are exercised.

At December 31, 2012, borrowings outstanding under the Wells Facility bore interest at a LIBOR plus 125 basis points, 150 basis points or 235 basis points depending on the collateral pledged. At March 31, 2013, borrowings outstanding under the Wells Facility bore interest at a LIBOR plus 105 basis points or 175 basis points depending on the collateral pledged.

At March 31, 2013, the Company’s borrowings had the following remaining maturities:


	Less than 1 year		1 to 3 years		3 to 5 years		More than 5 years		Total
Wells Facility borrowings*	$	166,467	$	45,474	$	—	$	—	$	211,941
JPMorgan Facility borrowings		—		3		—		—		3

Total	$	166,467	$	45,477	$	—	$	—	$	211,944

*	Assumes extension options on Wells Facility with respect to the Hilton CMBS are exercised.

At March 31, 2013, the Company’s collateralized financings were comprised of borrowings outstanding under the JPMorgan Facility and the Wells Facility. The table below summarizes the outstanding balances at March 31, 2013 as well as the maximum and average balances for the three months ended March 31, 2013.


			For the three months ended March 31, 2013
	Balance at March 31, 2013		Maximum Month-End Balance		Average Month-End Balance
Wells Facility borrowings	$	211,941	$	225,155	$	216,947
JPMorgan Facility borrowings		3		3		3

Total	$	211,944

In February 2013, the Company, through two of the Company’s subsidiaries, entered into a Second Amended and Restated Master Repurchase Agreement (the “Amended JPMorgan Master Repurchase Agreement”) with JPMorgan. The Amended JPMorgan Master Repurchase Agreement extended the maturity date of the JPMorgan Facility to January 31, 2014, with an option to further extend the maturity date for 364 days, subject to the Company’s satisfaction of certain customary conditions. The interest rate on the JPMorgan Facility is LIBOR+2.5%. The Company paid JPMorgan an upfront structuring fee of 0.50% of the facility amount for the first year of the term and, if the 364-day extension option is exercised, it will be required to pay an extension fee of 0.25% of the facility amount. The Company has agreed to provide a guarantee of the obligations of its borrower subsidiaries under the Amended JPMorgan Master Repurchase Agreement.

In February 2013, the Company amended the Wells Facility to reduce the interest rate as follows: (i) with respect to the outstanding borrowings used to provide financing for the AAA-rated CMBS, the interest rate was reduced to LIBOR+1.05% from LIBOR+1.25% - 1.50% (depending on the collateral pledged); and (ii) with respect to the outstanding borrowings used to provide financing for the Hilton CMBS, the interest rate was reduced to LIBOR+1.75% from LIBOR+2.35%. In addition, the maturity date of the Wells Facility with respect to the outstanding borrowings used to provide financing for the AAA-rated CMBS was extended to March 2014 and the Maximum Amount (as defined in the Wells Facility) was reduced to the outstanding balance of $212,343. The portion available to finance the Hilton CMBS matures in November 2014 and may be extended for an additional year upon the payment of an extension fee equal to 0.50% on the then aggregate outstanding repurchase price for all such assets.

The Company’s repurchase agreements are subject to certain financial covenants and the Company was in compliance with these covenants at March 31, 2013 and December 31, 2012.