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Date
Rule
802.2, 802.5
Staff
Michael Verne
Response/Comments
1) Agree 2) The latter 3) Servicing fee income would only be exempt for the realty-backed loans originated by the REIT

Question

From: (redacted)

Sent: Thursday, October05, 2006 2:00 PM

To:Verne, B. Michael

Subject: RE: Realty Exemptions

Mike.

Thanks again for your help with my questions below.Because no good deed goes unpunished, I have a few follow up questions.

(1) With respect to #3 below, I assume the entity inquestion would be deemed to underwrite title policies for the REIT if it doesso for transactions in which the REIT is selling property to third parties. Doyou agree?

(2) If the REIT holds vacant land which it leases to athird party, is this exempt realty or would it only be exempt if the rentalpayments in the last 36 months were less than $5 million?

(3) Servicing fee income on servicing mortgage and netlease debt portfolios would be exempt if the debt was generated by originatingand servicing realty backed loans. Is this correct? Would it also be exempt ifthe realty backed loans were originated by third parties?

Thanksagain Mike,

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