EXECUTION VERSION

 

COLLATERAL ADMINISTRATION AGREEMENT

 

This COLLATERAL ADMINISTRATION AGREEMENT, dated as of June 27, 2014 (this
“Agreement”), is entered into by and among BDCA-CB FUNDING, LLC, a limited
liability company formed under the laws of the State of Delaware (the
“Borrower”), BUSINESS DEVELOPMENT CORPORATION OF AMERICA, a Maryland
corporation, as collateral manager (in such capacity, the “Collateral Manager”),
CITIBANK, N.A., as administrative agent (in such capacity, the “Administrative
Agent”), and U.S. BANK NATIONAL ASSOCIATION (“U.S. Bank”), as collateral
administrator under and for purposes of this Agreement (in such capacity, the
“Collateral Administrator”).

 

WITNESSETH:

 

WHEREAS, pursuant to the terms of that certain Credit and Security Agreement
dated as of June 27, 2014 (the “Credit Agreement”), by and among the Borrower,
the lenders from time to time party thereto, the Administrative Agent, and U.S.
Bank, as Collateral Agent (in such capacity, the “Collateral Agent”) and as
custodian (in such capacity, the “Custodian”), the Borrower has pledged certain
collateral (the “Collateral”), which includes, among other things, all of the
Collateral Loans and Eligible Investments as security for the Advances and other
Obligations;

 

WHEREAS, the Borrower wishes to engage U.S. Bank to act as Collateral
Administrator to perform certain administrative duties with respect to the
Collateral pursuant to the terms of this Agreement; and

 

WHEREAS, U.S. Bank is prepared to perform as Collateral Administrator certain
specified obligations of the Borrower, or the Collateral Manager, on its behalf,
under the Credit Agreement (and certain other services) as specified herein,
upon and subject to the terms of this Agreement (but without assuming the
obligations or liabilities of the Borrower or the Collateral Manager under the
Credit Agreement);

 

NOW, THEREFORE, in consideration of the mutual covenants contained herein, and
other good and valuable consideration the receipt of which is hereby
acknowledged, the parties hereto agree as follows:

 

1.           Definitions. Capitalized terms not otherwise defined in this
Agreement shall have the meanings set forth in the Credit Agreement. The rules
of construction set forth in Section 1.02 of the Credit Agreement shall apply to
this Agreement as if fully set forth herein.

 

 

 

 

2.           Powers and Duties of Collateral Administrator.

 

(a)          The Borrower hereby appoints U.S. Bank as, and U.S. Bank hereby
accepts the appointment to act as, the Collateral Administrator pursuant to the
terms of this Agreement, until the earlier to occur of (i) U.S. Bank’s
resignation or removal as the Collateral Administrator pursuant to Section 7
hereof and (ii) the termination of this Agreement pursuant to Section 6 hereof.
In such capacity, the Collateral Administrator shall assist the Borrower and the
Collateral Manager in connection with maintaining a database of certain
characteristics with respect to the Collateral on an ongoing basis as provided
herein and in providing to the Borrower and the Collateral Manager certain
reports, schedules and calculations, all as more particularly described in
Section 2(b) below (in each case, such reports, schedules and calculations shall
be prepared in such form and content, and in such greater detail, as may be
mutually agreed upon by the parties hereto from time to time and as may be
required by the Credit Agreement) based upon information and data received from
the Borrower and/or the Collateral Manager, as required to be prepared and
delivered (or which are necessary to be prepared and delivered in order that
certain other reports, schedules and calculations can be prepared and delivered)
under Article VIII of the Credit Agreement. U.S. Bank’s duties and authority to
act as Collateral Administrator hereunder are limited to the duties and
authority specifically set forth in this Agreement. By entering into, or
performing its duties under, this Agreement, the Collateral Administrator shall
not be deemed to assume any obligations or liabilities of the Borrower or the
Collateral Manager under the Credit Agreement or any other Facility Document,
and nothing herein contained shall be deemed to release, terminate, discharge,
limit, reduce, diminish, modify, amend or otherwise alter in any respect the
duties, obligations or Liabilities of the Borrower or the Collateral Manager
under or pursuant to the Credit Agreement or any other Facility Document.

 

(b)          The Collateral Administrator shall perform the following general
functions from time to time:

 

(i)Promptly, and in any event within thirty (30) days after the Closing Date,
create a collateral database with respect to the Collateral (the “Collateral
Database”);

 

(ii)Update the Collateral Database promptly and on an ongoing basis for changes,
including for ratings changes as provided by the Collateral Manager, and to
reflect the sale or other disposition of the Collateral Loans included in the
Collateral (the “Portfolio Collateral”) and the addition to the Collateral of
additional Collateral Loans from time to time, in each case based upon, and to
the extent of, information furnished to the Collateral Administrator by or on
behalf of the Borrower or the Collateral Manager as may be reasonably required
by the Collateral Administrator, or by the agents for the Obligors from time to
time, or based on information maintained by U.S. Bank in its capacity as
Collateral Agent under the Credit Agreement;

 

(iii)Provide information contained in the Collateral Database to the Collateral
Manager on behalf of the Borrower, as the Collateral Administrator and the
Collateral Manager shall reasonably agree, including by way of reasonable
electronic access (by access to the Collateral Administrator’s internet website)
to the reports generated by the Collateral Administrator pursuant to this
Agreement;

 

(iv)Track the receipt and daily allocation of cash to the Collection Account
(and any subaccount thereto) with respect to Interest Proceeds and Principal
Proceeds and the outstanding balance therein, and any withdrawals therefrom and,
on each Business Day, provide to the Borrower and the Collateral Manager daily
reports reflecting such actions to the Covered Accounts as of the close of
business on the preceding Business Day;

 

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(v)[Reserved].

 

(vi)Reasonably cooperate with the Independent Accountants appointed by the
Borrower in the preparation by such accountants of the reports required under
Section 8.09 of the Credit Agreement;

 

(vii)Not later than three (3) Business Days prior to the day on which each
Monthly Report or Payment Date Report is required to be provided by the Borrower
pursuant to Section 8.07 of the Credit Agreement, the Collateral Administrator
shall prepare the relevant report using the information contained in the
Collateral Database and provide the results of such calculations to the
Collateral Manager so that the Collateral Manager may confirm such results. Upon
approval by the Collateral Manager, the Collateral Administrator shall deliver
the Monthly Report or Payment Date Report, as applicable, in accordance with
Section 8.07 of the Credit Agreement; and

 

(viii)So long as the same Person serves as the Collateral Administrator
hereunder and as the Collateral Agent under the Credit Agreement, provide such
other information with respect to the Collateral as may be routinely maintained
by the Collateral Administrator in performing its ordinary function as the
Collateral Agent pursuant to the Credit Agreement, or as may be required by the
Credit Agreement, as the Borrower or the Collateral Manager may reasonably
request from time to time.

 

(c)          The Borrower and the Collateral Manager shall cooperate with the
Collateral Administrator in connection with the matters described herein,
including calculations and information relating to the Monthly Reports and the
Payment Date Reports or as otherwise reasonably requested hereunder. Without
limiting the generality of the foregoing, the Collateral Manager shall advise in
a timely manner the Collateral Administrator of the results of any
determinations required or permitted to be made by it or the Borrower (or
Collateral Manager on its behalf) under the Credit Agreement and supply the
Collateral Administrator with such other information as is maintained by the
Collateral Manager that the Collateral Administrator may from time to time
request with respect to the Collateral and reasonably needed to complete the
reports and certificates required to be prepared by the Collateral Administrator
hereunder or required to permit the Collateral Administrator to perform its
obligations hereunder (including determinations of Market Value, Aggregate
Principal Balance, Concentration Limitations and the Borrowing Base, as
applicable) and any other information that may be reasonably required under the
Credit Agreement with respect to a Collateral Loan (including as to its
designation as a Covenant Lite Loan, Defaulted Collateral Loan, DIP Collateral
Loan, Noteless Loan, PIK Loan, Partial PIK Loan, Unquoted / Single-Bid
Collateral Loan, Credit Risk Collateral Loan, Ineligible Collateral Loan, Equity
Security, Standard Collateral Loan, First Lien Obligation, Floor Obligation,
Specified Eligible Investment, Structured Finance Obligation or Uncertificated
Security). Nothing herein shall obligate the Collateral Administrator to
determine independently the correct characterization or categorization of any
item of Collateral under the Credit Agreement (it being understood that any such
characterization or categorization shall be based exclusively upon the
determination and notification received by the Collateral Administrator from the
Collateral Manager). The Collateral Manager shall review and verify the contents
of the aforesaid reports. To the extent any of the information in such reports
conflicts with information, data or calculations in the records of the
Collateral Manager, the Collateral Manager shall notify the Collateral
Administrator of such discrepancy and use reasonable efforts to assist the
Collateral Administrator in reconciling such discrepancy. The Collateral Manager
further agrees to send such reports, instructions, statements and certificates
to the Borrower for execution. In addition, the Collateral Manager shall provide
prompt notice to the Collateral Administrator upon the Collateral Manager’s
obtaining knowledge of a Collateral Loan becoming a Defaulted Collateral Loan.

 

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(d)          If, in performing its duties under this Agreement, the Collateral
Administrator is required to decide between alternative courses of action, the
Collateral Administrator may request written instructions from the Borrower or
the Collateral Manager acting on behalf of the Borrower as to the course of
action desired by it. If the Collateral Administrator does not receive such
instructions within two (2) Business Days after it has requested them, the
Collateral Administrator may, but shall be under no duty to, take or refrain
from taking any such courses of action. The Collateral Administrator shall act
in accordance with instructions received after such two (2) Business Day period
except to the extent it has already taken, or committed itself to take, action
inconsistent with such instructions. The Collateral Administrator shall be
entitled to rely on the advice of legal counsel and independent accountants in
performing its duties hereunder and shall be deemed to have acted in good faith
if it acts in accordance with such advice.

 

(e)          Nothing herein shall prevent the Collateral Administrator or any of
its Affiliates from engaging in other businesses or from rendering services of
any kind to any Person.

 

3.          Compensation. The Borrower agrees to pay, and the Collateral
Administrator shall be entitled to receive, compensation for, and reimbursement
for all expenses in connection with, the Collateral Administrator’s performance
of the duties called for herein and as provided in the Collateral Agent Fee
Letter; provided that such amounts will be payable solely from and pursuant to
Section 9.01 of the Credit Agreement.

 

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4.          Limitation of Responsibility of the Collateral Administrator;
Indemnification.

 

(a)          The Collateral Administrator will have no responsibility under this
Agreement other than to render the services expressly called for hereunder in
good faith and without willful misconduct, gross negligence or reckless
disregard of its duties hereunder. The Collateral Administrator shall incur no
liability to anyone in acting upon any signature, instrument, statement, notice,
resolution, request, direction, consent, order, certificate, report, opinion,
bond or other document or paper reasonably believed by it to be genuine and
reasonably believed by it to be signed by the proper party or parties. The
Collateral Administrator may exercise any of its rights or powers hereunder or
perform any of its duties hereunder either directly or by or through agents or
attorneys, and the Collateral Administrator shall not be responsible for any
misconduct or negligence on the part of any agent (other than an Affiliate of
the Collateral Administrator) or attorney appointed hereunder with due care by
it. Neither the Collateral Administrator nor any of its affiliates, directors,
officers, shareholders, agents or employees will be liable to any other parties
hereto, the Borrower, the Collateral Manager or any other Person, except by
reason of acts or omissions by the Collateral Administrator constituting bad
faith, willful misconduct, gross negligence or reckless disregard of the
Collateral Administrator’s duties hereunder. The Collateral Administrator shall
in no event have any liability for the actions or omissions of the Borrower, the
Collateral Manager, the Custodian (but only if not the same Person as the
Collateral Administrator) or any other Person, and shall have no liability for
any inaccuracy or error in any duty performed by it that results from or is
caused by inaccurate, untimely or incomplete information or data received by it
from the Borrower, the Collateral Manager, the Custodian (but only if not the
same Person as the Collateral Administrator) or another Person except to the
extent that such inaccuracies or errors are caused by the Collateral
Administrator’s own bad faith, willful misconduct, gross negligence or reckless
disregard of its duties hereunder. The Collateral Administrator shall not be
liable for failing to perform or any delay in performing its specified duties
hereunder which results from or is caused by a failure or delay on the part of
the Borrower, the Collateral Manager, the Custodian (but only if not the same
Person as the Collateral Administrator) or any other Person in furnishing
necessary, timely and accurate information to the Collateral Administrator. The
duties and obligations of the Collateral Administrator and its employees or
agents shall be determined solely by the express provisions of this Agreement
and they shall not be under any obligation or duty except for the performance of
such duties and obligations as are specifically set forth herein, and no implied
covenants shall be read into this Agreement against them.

 

(b)          The Collateral Administrator may rely conclusively on any notice,
certificate or other document (including telecopier or other electronically
transmitted instructions, documents or information) furnished to it hereunder
and reasonably believed by it in good faith to be genuine. The Collateral
Administrator shall not be liable for any action taken by it in good faith and
reasonably believed by it to be within the discretion or powers conferred upon
it, or taken by it pursuant to any direction or instruction by which it is
governed hereunder, or omitted to be taken by it by reason of the lack of
direction or instruction required hereby for such action. The Collateral
Administrator shall not be bound to make any investigation into the facts or
matters stated in any certificate, report or other document; provided, however,
that, if the form thereof is prescribed by this Agreement, the Collateral
Administrator shall examine the same to determine whether it conforms on its
face to the requirements hereof. The Collateral Administrator shall not be
deemed to have knowledge or notice of any matter unless actually known to a
Responsible Officer of the Collateral Administrator responsible for the
administration of this Agreement. Under no circumstances shall the Collateral
Administrator be liable for indirect, punitive, special or consequential damages
under or pursuant to this Agreement, its duties or obligations hereunder or
arising out of or relating to the subject matter hereof. It is expressly
acknowledged by the Borrower and the Collateral Manager that application and
performance by the Collateral Administrator of its various duties hereunder
(including recalculations to be performed in respect of the matters contemplated
hereby) shall be based upon, and in reliance upon, data and information provided
to it by the Collateral Manager (and/or the Borrower) with respect to the
Collateral, and the Collateral Administrator shall have no responsibility for
the accuracy of any such information or data provided to it by such Persons.
Nothing herein shall impose or imply any duty or obligation on the part of the
Collateral Administrator to verify, investigate or audit any such information or
data, or to determine or monitor on an independent basis whether any obligor
under the Collateral is in default or in compliance with the underlying
documents governing or securing such securities, from time to time, the role of
the Collateral Administrator hereunder being solely to perform certain
mathematical computations and data comparisons and to provide certain reports
and other deliveries, as provided herein. For purposes of monitoring changes in
ratings, the Collateral Administrator shall be entitled to use and rely (in good
faith) exclusively upon one or more reputable electronic financial information
reporting services, and shall have no liability for any inaccuracies in the
information reported by, or other errors or omissions of, any such services.

 

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(c)          The Borrower shall, and hereby agrees to, reimburse, indemnify and
hold harmless the Collateral Administrator and its affiliates, directors,
officers, shareholders, agents and employees for and from any and all losses,
damages, liabilities, demands, charges, costs, expenses (including the
reasonable fees and expenses of counsel and other experts) and claims of any
nature in respect of, or arising from any acts or omissions performed or omitted
by the Collateral Administrator, its affiliates, directors, officers,
shareholders, agents or employees pursuant to or in connection with the terms of
this Agreement, or in the performance or observance of its duties or obligations
under this Agreement; provided the same are in good faith and without willful
misconduct and/or gross negligence on the part of the Collateral Administrator
or without reckless disregard of its duties hereunder. For the avoidance of
doubt, the obligations of the Borrower under this Section 4(c) shall be payable
only in accordance with the order specified in the priorities set forth in
Section 9.01 of the Credit Agreement and shall survive the termination of this
Agreement and any earlier resignation or removal of the Collateral
Administrator.

 

(d)          Nothing herein shall obligate the Collateral Administrator to
determine independently any characteristic of a Collateral Loan, or to evaluate
or verify the Collateral Manager’s characterization of any Collateral
Obligation, including whether any item of Collateral is a Covenant Lite Loan,
Defaulted Collateral Loan, DIP Collateral Loan, Noteless Loan, PIK Loan, Partial
PIK Loan, Unquoted / Single-Bid Collateral Loan, Credit Risk Collateral Loan,
Ineligible Collateral Loan, Equity Security, Standard Collateral Loan, First
Lien Obligation, Floor Obligation, Specified Eligible Investment, Structured
Finance Obligation or Uncertificated Security, any such determination being
based exclusively upon notification the Collateral Administrator receives from
the Collateral Manager or from (or in its capacity as) the Collateral Agent
(based upon notices received by the Collateral Agent from the obligor, trustee
or agent bank under an underlying governing document, or similar source) and
nothing herein shall obligate the Collateral Administrator to review or examine
any underlying instrument or contract evidencing, governing or guaranteeing or
securing any Collateral Loan in order to verify, confirm, audit or otherwise
determine any characteristic thereof.

 

(e)          Without limiting the generality of any terms of this Section 4, the
Collateral Administrator shall have no liability for any failure, inability or
unwillingness on the part of the Collateral Manager or the Borrower or the
Collateral Agent, if not the same Person as the Collateral Administrator, to
provide accurate and complete information on a timely basis to the Collateral
Administrator, or otherwise on the part of any such party to comply with the
terms of this Agreement or the Credit Agreement and shall have no liability for
any inaccuracy or error in the performance or observance on the Collateral
Administrator’s part of any of its duties hereunder that is caused by or results
from any such inaccurate, incomplete or untimely information received by it, or
other failure on the part of any such other party to comply with the terms
hereof.

 

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5.          No Joint Venture. Nothing contained in this Agreement (a) shall
constitute the Borrower, the Collateral Administrator and the Collateral Manager
as members of any partnership, joint venture, association, syndicate,
unincorporated business or other separate entity, (b) shall be construed to
impose any liability as such on any of them or (c) shall be deemed to confer on
any of them any express, implied or apparent authority to incur any obligation
or liability on behalf of the others.

 

6.          Term. This Agreement shall continue in effect so long as the Credit
Agreement remains in effect with respect to the Obligations, unless this
Agreement has been previously terminated in accordance with Section 7 hereof.

 

7.          Termination.

 

(a)          This Agreement may be terminated without cause by any party upon
not less than ninety (90) days’ written notice to each other party. If at any
time, prior to payment in full of all Obligations, the Collateral Administrator
shall resign or be removed as Collateral Agent under the Credit Agreement, such
resignation or removal shall be deemed a resignation or removal of the
Collateral Administrator hereunder.

 

(b)          At the option of the Borrower (with the prior written consent or at
the direction of the Administrative Agent), this Agreement may be terminated
upon ten (10) days’ written notice of termination from the Borrower (or the
Collateral Manager on behalf of the Borrower) to the Collateral Administrator if
any of the following events shall occur:

 

(i)The Collateral Administrator shall, in violation of its duty of care
hereunder, default in the performance of any of its material duties under this
Agreement and shall not cure such default within thirty (30) days (or, if such
default cannot be cured in such time, the Collateral Administrator shall not
have given within thirty (30) days such assurance of cure as shall be reasonably
satisfactory to the Borrower, the Collateral Manager and the Administrative
Agent and cured such default within the time so assured);

 

(ii)A court having jurisdiction in the premises shall enter a decree or order
for relief in respect of the Collateral Administrator in any involuntary case
under any applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, or appoint a receiver, liquidator, assignee, custodian,
trustee, sequestrator (or similar official) of the Collateral Administrator or
for any substantial part of its property, or order the winding up or liquidation
of its affairs; or

 

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(iii)The Collateral Administrator shall commence a voluntary case under
applicable bankruptcy, insolvency or other similar law now or hereafter in
effect, or shall consent to the entry of an order for relief in an involuntary
case under any such law, or shall consent to the appointment of or taking
possession by a receiver, liquidator, assignee, trustee, custodian, sequestrator
or similar official of the Collateral Administrator or for any substantial part
of its property, or shall make any general assignment for the benefit of
creditors, or shall fail generally to pay its debts as they become due.

 

If any of the events specified in clauses (ii) or (iii) of this Section 7(b)
shall occur, the Collateral Administrator shall give written notice thereof to
the Collateral Manager, the Administrative Agent and the Borrower within one (1)
Business Day after the occurrence of such event.

 

(c)          Except when the Collateral Administrator shall be removed pursuant
to subsection (b) of this Section 7 or shall resign pursuant to subsection (d)
of this Section 7, no removal or resignation of the Collateral Administrator
shall be effective until the date as of which a successor collateral
administrator reasonably acceptable to the Administrative Agent, the Borrower
and the Collateral Manager shall have agreed in writing to assume all of the
Collateral Administrator’s duties and obligations pursuant to this Agreement and
shall have executed and delivered an agreement in form and content reasonably
satisfactory to the Administrative Agent, the Borrower, the Collateral Manager
and the Collateral Agent. Upon any resignation or removal of the Collateral
Administrator hereunder, the Borrower shall promptly, and in any case within
thirty (30) days after the related notice of resignation or removal, appoint a
qualified successor consented to by the Administrative Agent to act as
collateral administrator hereunder and cause such successor collateral
administrator to execute and deliver an agreement accepting such appointment as
described in the preceding sentence. If the Borrower fails to appoint such a
qualified successor which duly accepts its appointment by properly executing and
delivering such an agreement within such time, the retiring Collateral
Administrator shall be entitled to petition a court of competent jurisdiction
for the appointment of a successor to serve as collateral administrator
hereunder and shall be indemnified pursuant to Section 4(c) for the reasonable
costs and expenses thereof.

 

(d)          Notwithstanding the foregoing, the Collateral Administrator may
resign its duties hereunder without any requirement that a successor collateral
administrator be obligated hereunder and without any liability for further
performance of any duties hereunder (i) immediately upon the termination
(whether by resignation or removal) of U.S. Bank as Collateral Agent under the
Credit Agreement, or (ii) upon thirty (30) days’ notice to the Collateral
Manager and the Administrative Agent upon any reasonable determination by U.S.
Bank that the taking of any action, or performance of any duty, on its part as
the Collateral Administrator pursuant to the terms of this Agreement would be in
conflict with or in violation of its duties or obligations as the Collateral
Agent under the Credit Agreement or (iii) upon at least sixty (60) days’ prior
written notice of termination to the Collateral Manager, the Administrative
Agent and the Borrower upon the occurrence of any of the following events and
the failure to cure such event within such sixty (60) day notice period: (A)
failure of the Borrower to pay any of the amounts specified in Section 3 hereof
within sixty (60) days after such amount is due pursuant to Section 3 hereof (to
the extent not already paid to the Collateral Administrator pursuant to Section
9.01 of the Credit Agreement) or (B) failure of the Borrower to provide any
indemnity payment to Collateral Administrator pursuant to the terms of this
Agreement, as the case may be, within sixty (60) days of the receipt by the
Borrower of the written request for such payment or reimbursement (to the extent
not already paid to the Collateral Administrator pursuant to Section 9.01 of the
Credit Agreement).

 

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(e)          Any corporation into which the Collateral Administrator may be
merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which the Collateral
Administrator shall be a party, or any corporation succeeding to all or
substantially all of the corporate trust business of the Collateral
Administrator, shall be the successor of the Collateral Administrator hereunder
without the execution or filing of any paper or any further act on the part of
any of the parties hereto.

 

8.           Representations and Warranties.

 

(a)          The Collateral Manager hereby represents and warrants to the
Collateral Administrator and the Borrower as follows:

 

(i)The Collateral Manager is a corporation duly organized and validly existing
under the laws of the State of Maryland, with full power and authority to own
and operate its assets and properties, conduct the business in which it is now
engaged and to execute and deliver and perform its obligations under this
Agreement and the other Facility Documents to which it is a party.

 

(ii)The Collateral Manager is in good standing in the State of Maryland. The
Collateral Manager is duly qualified to do business and, to the extent
applicable, is in good standing in each other jurisdiction in which the nature
of its business, assets and properties, including the performance of its
obligations under this Agreement, the other Facility Documents to which it is a
party and its Constituent Documents, requires such qualification, except where
the failure to be so qualified or in good standing could not reasonably be
expected to have a Material Adverse Effect.

 

(iii)The execution and delivery by the Collateral Manager of, and the
performance of its obligations under the Facility Documents to which it is a
party and the other instruments, certificates and agreements contemplated
thereby are within its powers and have been duly authorized by all requisite
action by it and have been duly executed and delivered by it and constitute its
legal, valid and binding obligations enforceable against it in accordance with
their respective terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting creditors’ rights generally or general principles of equity,
regardless of whether considered in a proceeding in equity or at law.

 

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(iv)None of the execution and delivery by the Collateral Manager of this
Agreement or the other Facility Documents to which it is a party, the
consummation of the transactions herein or therein contemplated, or compliance
by it with the terms, conditions and provisions hereof or thereof, will (1)
conflict with, or result in a breach or violation of, or constitute a default
under its Constituent Documents, (2) conflict with or contravene (A) any
Applicable Law, (B) any indenture, agreement or other contractual restriction
binding on or affecting it or any of its assets, including any Related Document,
or (C) any order, writ, judgment, award, injunction or decree binding on or
affecting it or any of its assets or properties or (3) result in a breach or
violation of, or constitute a default under, or permit the acceleration of any
obligation or liability in any contractual obligation or any agreement or
document to which it is a party or by which it or any of its assets are bound
(or to which any such obligation, agreement or document relates), except in the
case of clause (1) above, where such conflicts, breaches, violations or defaults
could not reasonably be expected to have a Material Adverse Effect.

 

(v)The Collateral Manager has obtained, maintained and kept in full force and
effect all Governmental Authorizations and Private Authorizations which are
necessary for it to properly carry out its business, except where the failure to
do so could not reasonably be expected to have a Material Adverse Effect, and
made all material Governmental Filings necessary for the execution and delivery
by it of the Facility Documents to which it is a party, and the performance by
the Collateral Manager of its obligations under this Agreement and the other
Facility Documents to which it is a party, and no material Governmental
Authorization, Private Authorization or Governmental Filing which has not been
obtained or made is required to be obtained or made by it in connection with the
execution and delivery by it of any Facility Document to which it is a party or
the performance of its obligations under this Agreement and the other Facility
Documents to which it is a party.

 

(vi)The Collateral Manager has duly observed and complied in all material
respects with all Applicable Laws relating to the conduct of its business and
its assets. The Collateral Manager has preserved and kept in full force and
effect its legal existence. The Collateral Manager has preserved and kept in
full force and effect its rights, privileges, qualifications and franchises,
except where the failure to do so could not reasonably be expected to result in
a Material Adverse Effect. Without limiting the foregoing, neither the
Collateral Manager nor, to the Collateral Manager’s knowledge, any Affiliate of
the Collateral Manager is (1) a country, territory, organization, person or
entity named on an OFAC list; (2) a Person that resides or has a place of
business in a country or territory named on such lists or which is designated as
a “NonCooperative Jurisdiction” by the Financial Action Task Force on Money
Laundering, or whose subscription funds are transferred from or through such a
jurisdiction; (3) a “Foreign Shell Bank” within the meaning of the PATRIOT Act,
i.e., a foreign bank that does not have a physical presence in any country and
that is not affiliated with a bank that has a physical presence and an
acceptable level of regulation and supervision; or (4) a person or entity that
resides in or is organized under the laws of a jurisdiction designated by the
United States Secretary of the Treasury under Sections 311 or 312 of the PATRIOT
Act as warranting special measures due to money laundering concerns. The
Collateral Manager is in compliance with all applicable OFAC rules and
regulations and also in compliance with all applicable provisions of the PATRIOT
Act.

 

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(b)          The Borrower hereby represents and warrants to the Collateral
Administrator and the Collateral Manager as follows:

 

(i)The Borrower is a limited liability company formed and validly existing under
the laws of the State of Delaware, with full power and authority to own and
operate its assets and properties, conduct the business in which it is now
engaged and to execute and deliver and perform its obligations under this
Agreement and the other Facility Documents to which it is a party.

 

(ii)The Borrower is in good standing in the State of Delaware. The Borrower is
duly qualified to do business and, to the extent applicable, is in good standing
in each other jurisdiction in which the nature of its business, assets and
properties, including the performance of its obligations under this Agreement,
the other Facility Documents to which it is a party and its Constituent
Documents, requires such qualification, except where the failure to be so
qualified or in good standing could not reasonably be expected to have a
Material Adverse Effect.

 

(iii)The execution and delivery by the Borrower of, and the performance of its
obligations under the Facility Documents to which it is a party and the other
instruments, certificates and agreements contemplated thereby are within its
powers and have been duly authorized by all requisite action by it and have been
duly executed and delivered by it and constitute its legal, valid and binding
obligations enforceable against it in accordance with their respective terms,
except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting creditors’ rights
generally or general principles of equity, regardless of whether considered in a
proceeding in equity or at law.

 

(iv)None of the execution and delivery by the Borrower of this Agreement or the
other Facility Documents to which it is a party, the Borrowings or the pledge of
the Collateral hereunder, the consummation of the transactions herein or therein
contemplated, or compliance by it with the terms, conditions and provisions
hereof or thereof, will (1) conflict with, or result in a breach or violation
of, or constitute a default under its Constituent Documents, (2) conflict with
or contravene (A) any Applicable Law, (B) any indenture, agreement or other
contractual restriction binding on or affecting it or any of its assets,
including any Related Document, or (C) any order, writ, judgment, award,
injunction or decree binding on or affecting it or any of its assets or
properties or (3) result in a breach or violation of, constitute a default
under, or permit the acceleration of any obligation or liability in, any
contractual obligation or any agreement or document to which it is a party or by
which it or any of its assets are bound (or to which any such obligation,
agreement or document relates).

 

11

 

 

(v)The Borrower has obtained, maintained and kept in full force and effect all
Governmental Authorizations and Private Authorizations which are necessary for
it to properly carry out its business, except where the failure to do so could
not reasonably be expected to have a Material Adverse Effect, and made all
material Governmental Filings necessary for the execution and delivery by it of
the Facility Documents to which it is a party, the Borrowings by the Borrower
under this Agreement, the pledge of the Collateral by the Borrower under this
Agreement and the performance by the Borrower of its obligations under this
Agreement and the other Facility Documents to which it is a party, and no
material Governmental Authorization, Private Authorization or Governmental
Filing which has not been obtained or made is required to be obtained or made by
it in connection with the execution and delivery by it of any Facility Document
to which it is a party, the Borrowings by the Borrower under this Agreement, the
pledge of the Collateral by the Borrower under this Agreement or the performance
of its obligations under this Agreement and the other Facility Documents to
which it is a party.

 

(vi)The Borrower has duly observed and complied in all material respects with
all Applicable Laws relating to the conduct of its business and its assets. The
Borrower has preserved and kept in full force and effect its legal existence.
The Borrower has preserved and kept in full force and effect its rights,
privileges, qualifications and franchises, except where the failure to do so
could not reasonably be expected to result in a Material Adverse Effect. Without
limiting the foregoing, neither the Borrower nor to the Borrower’s knowledge,
any Affiliate of the Borrower is (1) a country, territory, organization, person
or entity named on an OFAC list; (2) a Person that resides or has a place of
business in a country or territory named on such lists or which is designated as
a “NonCooperative Jurisdiction” by the Financial Action Task Force on Money
Laundering, or whose subscription funds are transferred from or through such a
jurisdiction; (3) a “Foreign Shell Bank” within the meaning of the PATRIOT Act,
i.e., a foreign bank that does not have a physical presence in any country and
that is not affiliated with a bank that has a physical presence and an
acceptable level of regulation and supervision; or (4) a person or entity that
resides in or is organized under the laws of a jurisdiction designated by the
United States Secretary of the Treasury under Sections 311 or 312 of the PATRIOT
Act as warranting special measures due to money laundering concerns. The
Borrower is in compliance with all applicable OFAC rules and regulations and
also in compliance with all applicable provisions of the PATRIOT Act.

 

12

 

 

(c)          The Collateral Administrator hereby represents and warrants to the
Collateral Manager and the Borrower as follows:

 

(i)The Collateral Administrator is a national banking association duly
organized, validly existing and in good standing under the laws of the United
States of America and has full organizational power and authority to execute,
deliver and perform this Agreement and all obligations required hereunder and
has taken all necessary corporate action to authorize this Agreement on the
terms and conditions hereof, the execution, delivery and performance of this
Agreement and all obligations required hereunder. No consent of any other Person
including stockholders or other equity holder and creditors of the Collateral
Administrator, and no license, permit, approval or authorization of, exemption
by, notice or report to, or registration, filing or declaration with, any
governmental authority, except those that have been obtained, is required by the
Collateral Administrator in connection with this Agreement or the execution,
delivery, performance, validity or enforceability of this Agreement and the
obligations imposed upon it hereunder. When executed and delivered by the
Collateral Administrator and the other parties hereto, this Agreement will
constitute the legal, valid and binding obligations of the Collateral
Administrator enforceable against the Collateral Administrator in accordance
with its terms, subject, as to enforcement, (a) to the effect of bankruptcy,
insolvency or similar laws affecting generally the enforcement of creditors’
rights as such laws would apply in the event of any bankruptcy, receivership,
insolvency or similar event applicable to the Collateral Administrator and
(b) to general equitable principles (whether enforceability of such principles
is considered in a proceeding at law or in equity).

 

(ii)The execution, delivery and performance of this Agreement and the documents
and instruments required hereunder will not violate any provision of any
existing law or regulation binding on the Collateral Administrator, or any
order, judgment, award or decree of any court, arbitrator or governmental
authority binding on the Collateral Administrator, or the articles of
association or by-laws, as amended, of the Collateral Administrator or of any
mortgage, indenture, lease, contract or other agreement, instrument or
undertaking to which the Collateral Administrator is a party or by which the
Collateral Administrator or any of its assets may be bound, the violation of
which would have a material adverse effect on the business, operations, assets
or financial condition of the Collateral Administrator and will not result in,
or require, the creation or imposition of any lien on any of its property,
assets or revenues pursuant to the provisions of any such mortgage, indenture,
lease, contract or other agreement, instrument or undertaking the creation or
imposition of which would have a material adverse effect on the business
operations, assets or financial condition of the Collateral Administrator.

 

13

 

 

9.           Amendments. This Agreement may not be amended, changed, modified or
terminated (except as otherwise expressly provided herein) except by the
Collateral Manager, the Borrower and the Collateral Administrator in writing
with the prior written consent of the Administrative Agent.

 

10.         Governing Law. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES UNDER THIS AGREEMENT AND ANY CLAIM, CONTROVERSY, DISPUTE OR CAUSE OF
ACTION (WHETHER IN CONTRACT OR TORT OR OTHERWISE) BASED UPON, ARISING OUT OF OR
RELATING TO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK
(WITHOUT REGARD TO ITS CHOICE OF LAWS RULES OTHER THAN SECTION 5-1401 OF THE NEW
YORK GENERAL OBLIGATIONS LAW).

 

11.         Submission to Jurisdiction; Waivers; Etc. Each party hereto hereby
irrevocably and unconditionally (a) submits for itself and its property in any
legal action or proceeding relating to this Agreement or the other Facility
Documents to which it is a party, or for recognition and enforcement of any
judgment in respect thereof, to the non-exclusive general jurisdiction of the
courts of the State of New York in the Borough of Manhattan, the courts of the
United States of America for the Southern District of New York, and the
appellate courts of any of them; (b) consents that any such action or proceeding
may be brought in any court described in Section 11(a) and waives to the fullest
extent permitted by Applicable Law any objection that it may now or hereafter
have to the venue of any such action or proceeding in any such court or that
such action or proceeding was brought in an inconvenient court and agrees not to
plead or claim the same; (c) agrees that service of process in any such action
or proceeding may be effected by mailing a copy thereof by registered or
certified mail (or any substantially similar form of mail), postage prepaid, to
such party at its address set forth in Section 13 or at such other address as
may be permitted thereunder; (d) agrees that nothing herein shall affect the
right to effect service of process in any other manner permitted by law; and (e)
waives, to the maximum extent not prohibited by law, any right it may have to
claim or recover in any legal action or proceeding against any Secured Party
arising out of or relating to this Agreement or the other Facility Documents any
special, exemplary, punitive or consequential damages.

 

12.         IMPORTANT WAIVERS.

 

(a)          EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHTS IT MAY HAVE TO A
TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR
ANY OTHER FACILITY DOCUMENT OR FOR ANY COUNTERCLAIM HEREIN OR THEREIN OR
RELATING HERETO OR THERETO, OR ANY COURSE OF CONDUCT, COURSE OF DEALING,
STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THE EQUITYHOLDER, THE
BORROWER, THE COLLATERAL MANAGER, THE AGENTS OR ANY OTHER AFFECTED PERSON. EACH
PARTY HERETO ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL AND SUFFICIENT
CONSIDERATION FOR THIS PROVISION (AND EACH OTHER PROVISION OF EACH OTHER
FACILITY DOCUMENT TO WHICH IT IS A PARTY) AND THAT THIS PROVISION IS A MATERIAL
INDUCEMENT FOR ITS ENTERING INTO THIS AGREEMENT AND EACH SUCH OTHER FACILITY
DOCUMENT. TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH PARTY HEREBY WAIVES
ANY RIGHT TO CLAIM OR RECOVER IN ANY LITIGATION WHATSOEVER INVOLVING ANY
INDEMNIFIED PARTY, ANY SPECIAL, EXEMPLARY, PUNITIVE, INDIRECT, INCIDENTAL OR
CONSEQUENTIAL DAMAGES OF ANY KIND OR NATURE WHATSOEVER OR ANY DAMAGES OTHER
THAN, OR IN ADDITION TO, ACTUAL DAMAGES, WHETHER SUCH WAIVED DAMAGES ARE BASED
ON STATUTE, CONTRACT, TORT, COMMON LAW OR ANY OTHER LEGAL THEORY, WHETHER THE
LIKELIHOOD OF SUCH DAMAGES WAS KNOWN AND REGARDLESS OF THE FORM OF THE CLAIM OF
ACTION. NO PARTY OR INDEMNIFIED PARTY SHALL BE LIABLE FOR ANY DAMAGES ARISING
FROM THE USE BY UNINTENDED RECIPIENTS OF ANY INFORMATION OR OTHER MATERIALS
DISTRIBUTED BY IT THROUGH TELECOMMUNICATIONS, ELECTRONIC OR OTHER INFORMATION
TRANSMISSION SYSTEMS IN CONNECTION WITH ANY FACILITY DOCUMENT OR THE
TRANSACTIONS. EACH PARTY CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF
THE OTHER PARTY OR AN INDEMNIFIED PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE,
THAT BUYER OR AN INDEMNIFIED PARTY WOULD NOT SEEK TO ENFORCE ANY OF THE WAIVERS
IN THIS SECTION 12 IN THE EVENT OF LITIGATION OR OTHER CIRCUMSTANCES. THE SCOPE
OF SUCH WAIVERS IS INTENDED TO BE ALL–ENCOMPASSING OF ANY AND ALL DISPUTES THAT
MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THE FACILITY
DOCUMENTS, REGARDLESS OF THEIR LEGAL THEORY.  EACH PARTY ACKNOWLEDGES THAT THE
WAIVERS IN THIS SECTION 12 ARE A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS
RELATIONSHIP, THAT SUCH PARTY HAS ALREADY RELIED ON SUCH WAIVERS IN ENTERING
INTO THE FACILITY DOCUMENTS, AND THAT SUCH PARTY WILL CONTINUE TO RELY ON SUCH
WAIVERS IN THEIR RELATED FUTURE DEALINGS UNDER THE FACILITY DOCUMENTS. EACH
PARTY FURTHER REPRESENTS AND WARRANTS THAT IT HAS REVIEWED SUCH WAIVERS WITH ITS
LEGAL COUNSEL AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES ITS RIGHT TO A JURY
TRIAL AND OTHER RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. THE WAIVERS IN
THIS SECTION 12 ARE IRREVOCABLE, MEANING THAT THEY MAY NOT BE MODIFIED EITHER
ORALLY OR IN WRITING, AND SHALL APPLY TO ANY AMENDMENTS, RENEWALS, SUPPLEMENTS
OR MODIFICATIONS TO ANY OF THE FACILITY DOCUMENTS. IN THE EVENT OF LITIGATION,
THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT. THE
PROVISIONS OF THIS SECTION 12 SHALL SURVIVE TERMINATION OF THE FACILITY
DOCUMENTS AND THE INDEFEASIBLE PAYMENT IN FULL OF THE OBLIGATIONS.

 

14

 

 

13.         Notices. Any notice, report or other communication given hereunder
shall be delivered in writing, electronically, via facsimile or addressed to the
address for each such party set forth in the Credit Agreement, or to such other
address as any party shall have provided to the other parties in writing. All
notices required or permitted to be given hereunder shall be in writing and
shall be deemed given if such notice is mailed by first class mail, postage
prepaid, hand delivered, sent by overnight courier service guaranteeing next day
delivery or sent by electronic mail or by telecopy (facsimile) in legible form
to the address of such party as provided above.

 

14.         Successors and Assigns. This Agreement shall inure to the benefit
of, and be binding upon, the successors and assigns of each of the Collateral
Manager, the Borrower and the Collateral Administrator; provided, however, that
the Collateral Administrator may not assign its rights and obligations hereunder
without the prior written consent of the Collateral Manager, the Administrative
Agent and the Borrower, except that the Collateral Administrator may delegate
to, employ as agent, or otherwise cause any duty or obligation hereunder to be
performed by, any direct or indirect wholly owned subsidiary of the Collateral
Administrator or its successors without the prior written consent of the
Collateral Manager, the Administrative Agent or the Borrower (provided that in
such event the Collateral Administrator shall remain responsible for the
performance of its duties as the Collateral Administrator hereunder).
Notwithstanding the foregoing, the Collateral Administrator consents to the
pledge of its rights under this Agreement by the Borrower to the Collateral
Agent, as provided in the granting language set forth in Section 7.01 of the
Credit Agreement.

 

15.         Counterparts. This Agreement may be executed in any number of
counterparts and by different parties hereto on separate counterparts, each of
which counterparts, when so executed and delivered, shall be deemed to be an
original and all of which counterparts, taken together, shall constitute but one
and the same Agreement. Delivery of an executed signature page of this Agreement
by facsimile or other electronic transmission shall be effective as delivery of
a manually executed counterpart hereof.

 

16.         Severability. Any provision of this Agreement or any other Facility
Document which is prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or
affecting the validity or enforceability of such provision in any other
jurisdiction.

 

17.         Conflict with the Credit Agreement. If this Agreement shall require
that any action be taken with respect to any matter and the Credit Agreement
shall require that a different action be taken with respect to such matter, and
such actions shall be mutually exclusive, or if this Agreement should otherwise
conflict with the Credit Agreement, the Collateral Administrator shall notify
the Collateral Manager and act in accordance with the Collateral Manager’s
instructions.

 

18.         Subordination. The Collateral Administrator agrees that the payment
of all amounts to which it is entitled pursuant to this Agreement shall be
subordinated to the extent set forth in, and the Collateral Administrator agrees
to be bound by the provisions of, the Credit Agreement (as if it were a party to
the Credit Agreement, in the case of any successor Collateral Administrator that
is not also serving as Collateral Agent under the Credit Agreement).

 

19.         Survival. Notwithstanding anything herein to the contrary, all
indemnifications set forth or provided for in this Agreement shall survive the
termination of this Agreement.

 

15

 

 

20.         No Petition in Bankruptcy. The Collateral Administrator agrees not
to file or join in the filing of an involuntary petition in bankruptcy against
the Borrower for the nonpayment of the Collateral Administrator’s fees or other
amounts payable by the Borrower under this Agreement until the payment in full
of all Obligations issued under the Credit Agreement and the expiration of a
period equal to one year and one day or, if longer, the applicable preference
period under the Bankruptcy Code plus ten (10) days following said payment. The
provisions of this Section 20 shall survive termination of this Agreement.

 

21.         Limited Recourse Against Borrower. Notwithstanding any other
provision of this Agreement, each of the parties hereto hereby agrees that any
obligations of the Borrower under this Agreement are limited recourse
obligations of the Borrower, payable solely from the Collateral in accordance
with Article IX of the Credit Agreement, and following realization of the
Collateral, all obligations of the Borrower under this Agreement and any claims
of a party hereto shall be extinguished and shall not thereafter revive. No
recourse shall be had against any officer, director, employee, manager or member
of the Borrower or its successors and assigns for the payment of any amounts
payable under this Agreement. The provisions of this Section 18 shall survive
the termination of this Agreement.

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

16

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Collateral
Administration Agreement to be executed and delivered as of the day first above
written.

 

  BDCA-CB FUNDING, LLC, as Borrower       By:   Business Development Corporation
of
America, as its sole member

 

  By: /s/ Robert K. Grunewald     Name: Robert K. Grunewald     Title: Chief
Investment Officer

 

  Business Development Corporation
of America, as Collateral Manager

 

  By: /s/ Robert K. Grunewald     Name: Robert K. Grunewald     Title: Chief
Investment Officer

 

[Signature Page to Collateral Administration Agreement]

 

 

 

 

  U.S. BANK NATIONAL ASSOCIATION, as
Collateral Administrator

 

  By: /s/ Jeffrey B. Stone     Name: Jeffrey B. Stone     Title: Vice President

 

[Signature Page to Collateral Administration Agreement]

 

 

 

 

  CITIBANK, N.A., as Administrative Agent

 

  By: /s/ Vincent Nocerino     Name: Vincent Nocerino     Title: Vice President

 

[Signature Page to Collateral Administration Agreement]