NEWCASTLE INVESTMENT CORP.
Common Stock
TERMS AGREEMENT
Dated: January 6, 2004
To: Newcastle Investment Corp.
1251 Avenue of the Americas
New York, New York 10020
Attention: Wesley R. Edens
Ladies and Gentlemen:
We understand that Newcastle Investment Corp., a corporation organized and
existing under the laws of Maryland (the "Company"), proposes to issue and sell
3,300,000 shares of common stock, set forth below (the "Underwritten
Securities"). Subject to the terms and conditions set forth or incorporated by
reference herein, the underwriter named below (the "Underwriter") offers to
purchase the number of Underwritten Securities (as such term is defined in the
Underwriting Agreement referred to below) set forth below opposite its name, at
the purchase price set forth below.
NUMBER
OF SHARES OF
UNDERWRITTEN
UNDERWRITER SECURITIES
Merrill Lynch, Pierce, Fenner & Smith
Incorporated 3,300,000
---------
Total.................................. 3,300,000
=========
The Underwritten Securities shall have the following terms:
Title of Securities: Common Stock, $.01 par value per share
Number of Shares: 3,300,000
Public offering price per share: $26.30
Purchase price per share: $26.015
Number of Option Securities, if any, that may be purchased by the Underwriter:
None
Delayed Delivery Contracts: Not Authorized
Additional co-managers, if any: None
Terms of Lock-up: As stated in section 3(a)(x) of the Underwriting
Agreement, during the period of 30 days from the date of
the Prospectus Supplement, the Company will not, directly
or indirectly, without the prior written consent of
Merrill Lynch, Pierce, Fenner and Smith Incorporated (a)
issue, sell, offer or agree to sell, grant any option for
the sale of, pledge, make any short sale or maintain any
short position, establish or maintain a "put equivalent
position" (within the meaning of Rule 16-a-1(h) under the
1934 Act), enter into any swap, derivative transaction or
other arrangement that transfers to another, in whole or
in part, any of the economic consequences of ownership of
the Common Stock (whether any such transaction is to be
settled by delivery of Common Stock, other securities,
cash or other consideration) or otherwise dispose of, any
Common Stock (or any securities convertible into,
exercisable for or exchangeable for Common Stock) or
interest therein of the Company or of any of its
subsidiaries, other than the Company's sale of Shares
pursuant to this Agreement and the Company's issuance of
Common Stock (i) upon the exercise of presently
outstanding options; (ii) in connection with acquisitions
by the Company or a subsidiary, and (iii) the grant and
exercise of options under, or the issuance and sale of
shares pursuant to, employee stock option plans in effect
on the date hereof or (b) file a registration statement
under the 1933 Act registering shares of Common Stock (or
any securities convertible into, exercisable for or
exchangeable for Common Stock) or any interest in shares
of Common Stock, except for a registration statement on
Form S-8 with respect to shares of Common Stock issuable
under the Newcastle Investment Corp. Nonqualified Stock
Option and Incentive Award Plan, as amended from time to
time.
At the time the Underwriting Agreement and this Agreement
are executed, Merrill Lynch, Pierce, Fenner & Smith
Incorporated shall have received a letter agreement from
the Manager and Fortress Principal Investment Holdings
LLC ("FPIH"), and each director, officer or related party
of the Company and the Manager designated by you and
listed on Schedule II to the Underwriting Agreement,
substantially in the forms attached thereto as Annex III
and Annex IV, respectively.
Other terms: None
Closing date and location: January 9, 2004, 10:00 a.m.; Sidley Austin Brown &
Wood LLP, 787 Seventh Avenue, New York, New York 10019
All of the provisions contained in the Underwriting Agreement attached as Annex
A hereto are hereby incorporated by reference in their entirety herein and shall
be deemed to be a part of this Terms Agreement to the same extent as if such
provisions had been set forth in full herein. Terms defined in such document are
used herein as therein defined.
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Please accept this offer no later than 7:00 P.M. (New York City time) on January
6, 2004 by signing a copy of this Terms Agreement in the space set forth below
and returning the signed copy to us.
Very truly yours,
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By: /s/ Alexander S. Rubin
---------------------------
Name: Alexander S. Rubin
Title: Managing Director
Accepted:
NEWCASTLE INVESTMENT CORP.
By: /s/ Wesley R. Edens
-------------------------------------------
Name: Wesley R. Edens
Title: Chief Executive Officer
FORTRESS INVESTMENT GROUP LLC
By: /s/ Randal A. Nardone
-------------------------------------------
Name: Randal A. Nardone
Title: Chief Operating Officer
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