Exhibit 10.21

 

EXECUTION VERSION

 

MASTER PARTICIPATION AND ASSIGNMENT AGREEMENT

 

Master Participation and Assignment Agreement (as amended from time to time,
this “Agreement”), dated as of August 28, 2019, between BCSF II-C, LLC, a
Delaware limited liability company (the “Closing Date Seller”), and BCC Middle
Market CLO 2019-1, LLC, a Cayman Islands limited liability company (the
“Issuer”).

 

RECITALS

 

WHEREAS, the Closing Date Seller owns certain loans (the “Collateral
Obligations”) and the Issuer desires to purchase certain of such Collateral
Obligations and/or portions thereof as set forth on Annex A hereto;

 

WHEREAS, on or prior to the date hereof, the Collateral Obligations have been
released from the security interest therein granted to Wells Fargo Bank,
National Association, as collateral agent (in such capacity, the “Collateral
Agent”), for the benefit of the secured parties pursuant to that certain credit
and security agreement, dated as of February 19, 2019 (the “Credit Agreement”),
among the Closing Date Seller, as borrower, the Lenders from time to time
parties thereto, Citibank, N.A., as administrative agent, Bain Capital Specialty
Finance, Inc., as equityholder and servicer and the Collateral Agent, as
Collateral Agent, custodian and collateral administrator;

 

WHEREAS, the Issuer and the Transferor have entered into a master loan sale
agreement (as amended from time to time, the “Loan Sale Agreement”), dated as of
the date hereof, pursuant to which the Transferor has agreed to sell certain
loans, including the Transferred Assets, to the Issuer, subject to the
conditions precedent to each such sale set forth in the Loan Sale Agreement;

 

WHEREAS, the settlement of the acquisition of the Transferred Assets by the
Transferor from the Closing Date Seller and by the Issuer from the Transferor
shall occur, solely for administrative convenience, pursuant to and in
accordance with this Agreement whereby the Closing Date Seller will (i) grant a
participation interest in each Transferred Asset directly to the Issuer pursuant
to Section 2.01 and (ii) thereafter cause an assignment of each such Transferred
Asset to be delivered to the Issuer so that the Issuer becomes the record owner
of such Transferred Asset pursuant to Section 2.05;

 

WHEREAS, such grant by the Closing Date Seller and acquisition by the Issuer of
such participation interest in each Transferred Asset is referred to herein as
the “Transfer” of such Transferred Asset; and

 

WHEREAS, with respect to any Transferred Asset, the Closing Date Seller and the
Issuer will cause the relevant participation to be elevated to an assignment as
soon as practicable, pursuant to the provisions of Section 2.05, after the
Settlement Date.  Such elevation is referred to herein as the “Elevation” with
respect to any Transferred Asset, and the date of any Elevation of such
Transferred Asset is referred to herein as the related “Elevation Date”.

 

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AGREEMENT

 

Accordingly, in consideration of the mutual agreements set forth herein and
other valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto hereby agree as follows.

 

ARTICLE I
Definitions

 

SECTION 1.01              Certain Definitions; Interpretation.

 

(a)                                 Capitalized terms used but not otherwise
defined herein shall have the meanings assigned to such terms in the Loan Sale
Agreement or, if not defined therein, in the Indenture. In addition, as used
herein, the following defined terms, unless the context otherwise requires,
shall have the following meanings (to the extent not otherwise defined herein):

 

“Agreement” has the meaning specified in the Preamble.

 

“Closing Date Seller” has the meaning specified in the Preamble.

 

“Collateral Agent” has the meaning specified in the Preamble.

 

“Collateral Obligations” has the meaning specified in the Recitals.

 

“Elevation” has the meaning specified in the Recitals.

 

“Elevation Date” has the meaning specified in the Recitals.

 

“Income Collections” has the meaning specified in Section 2.01.

 

“Indenture” means the Indenture, dated as of August 28, 2019 (as amended,
modified, restated or supplemented from time to time), between the Issuer, BCC
Middle Market CLO 2019-1 Co-Issuer, LLC, as co-issuer and Wells Fargo Bank,
National Association, as trustee (together with its successors and assigns in
such capacity, the “Trustee”).

 

“Issuer” has the meaning specified in the Preamble.

 

“Loan Sale Agreement” has the meaning specified in the Recitals.

 

“Participation Interest” and “Participation Interests” have the meanings
specified in Section 2.01.

 

“Participation Percentage” means, with respect to each Collateral Obligation,
the percentage set forth on Annex A hereto representing the percentage portion
of such Collateral Obligation conveyed to the Issuer by the Closing Date Seller
pursuant to the terms of this Agreement.

 

“Portfolio Manager” means Bain Capital Specialty Finance, Inc., in its capacity
as portfolio manager under the Portfolio Management Agreement, dated as of
August 28, 2019, by and between the Issuer and the Portfolio Manager.

 

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“Proceeding” means any suit in equity, action at law or other judicial or
administrative proceeding thereof.

 

“Representing Party” has the meaning specified in Section 3.01.

 

“Settlement Date” means August 28, 2019.

 

“Transfer” has the meaning specified in the Recitals.

 

“Transferor” has the meaning specified in the Recitals.

 

“Transferred Assets” means the Collateral Obligations or portions thereof (if
less than 100%, in the case of Partially-Participated Assets) equal to the
applicable Participation Percentage of each such Collateral Obligation conveyed
by the Closing Date Seller to the Issuer hereunder, in each case as set forth on
Annex A hereto.

 

(b)                                 In this Agreement, unless a contrary
intention appears:

 

(i)                                     the singular number includes the plural
number and vice versa;

 

(ii)                                  reference to any Person includes such
Person’s successors and assigns but, if applicable, only if such successors and
assigns are permitted by the Transaction Documents;

 

(iii)                               reference to any gender includes each other
gender;

 

(iv)                              reference to day or days without further
qualification means calendar days;

 

(v)                                 unless otherwise stated, reference to any
time means New York, New York time;

 

(vi)                              references to “writing” include printing,
typing, lithography, electronic or other means of reproducing words in a visible
form;

 

(vii)                           reference to any agreement (including any
Transaction Document), document or instrument means such agreement, document or
instrument as amended, modified, supplemented, replaced, restated, waived or
extended and in effect from time to time in accordance with the terms thereof
and, if applicable, the terms of the other Transaction Documents, and reference
to any promissory note includes any promissory note that is an extension or
renewal thereof or a substitute or replacement therefor;

 

(viii)                        reference to any requirement of law means such
requirement of law as amended, modified, codified, replaced or reenacted, in
whole or in part, and in effect from time to time, including rules and
regulations promulgated thereunder and reference to any Section or other
provision of any requirement of law means that provision of such requirement of
law from time to time in effect and

 

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constituting the substantive amendment, modification, codification, replacement
or reenactment of such Section or other provision; and

 

(ix)                              references to “including” means “including,
without limitation”.

 

(c)                                  The titles of Articles and Sections hereof
are for convenience only, and they neither form a part of this Agreement nor are
to be used in the construction or interpretation hereof.

 

ARTICLE II
Transfer

 

SECTION 2.01              Transfer.  Upon the terms and subject to the
conditions hereof on the Settlement Date, the Closing Date Seller hereby
irrevocably grants to the Issuer, and the Issuer hereby acquires from the
Closing Date Seller, an undivided participation interest in each Transferred
Asset, which interest shall be understood to include all of (or, in the case of
a Partially-Participated Asset, the Issuer’s Pro Rata Share of) the Closing Date
Seller’s right, title, benefit and interest in and to any interest accruing from
and after the Settlement Date, any Interest Proceeds and Principal Proceeds and
any other payments, proceeds or other period distributions to the extent
provided in Section 2.02 (collectively, “Income Collections”) and, to the extent
permitted to be transferred under applicable law and under the applicable
transfer document or assignment agreement (or, in the case of any Underlying
Instrument that is in the form of a note, any chain of endorsement) executed and
delivered in connection with a Transferred Asset, all claims, causes of action
and any other right of the Closing Date Seller (in its capacity as a lender
under such documentation), whether known or unknown, against any Obligor or any
of its affiliates, agents, representatives, contractors, advisors or other
Person arising under or in connection with such documentation or that is in any
way based on or related to any of the foregoing or the loan transactions
governed thereby, including contract claims, tort claims, malpractice claims,
statutory claims and all other claims at law or in equity related to the rights
and obligations sold and purchased pursuant to this Agreement (each, a
“Participation Interest” and, collectively, the “Participation Interests”), upon
the terms and subject to the conditions set forth in this Agreement.  The Issuer
hereby assumes all obligations and liabilities of the Closing Date Seller as
lender with respect to or in connection with each related Participation Interest
arising or occurring on or after the Settlement Date.  The consideration for the
transfer of the Participation Interests from the Closing Date Seller to the
Issuer shall consist of cash paid to the Closing Date Seller by the Issuer.  The
parties hereto agree that, solely for administrative convenience, any amount
paid in cash by the Issuer to the Closing Date Seller pursuant to this Agreement
on account of its purchase of a Participation Interest to be conveyed hereunder
shall be treated for all purposes hereunder and under the Loan Sale Agreement as
if such amount had been paid by the Issuer to the Transferor, in partial or full
satisfaction of its obligations to pay the purchase price of such initial
Transferred Assets under the Loan Sale Agreement and/or a capital contribution
by the Transferor to the Closing Date Seller; provided that the Issuer, the
Closing Date Seller and the Transferor may agree to net certain amounts payable
hereunder with other amounts paid in connection with the sale of the Notes and
incurrence of the Class A-1L Loans issued under the Indenture and the
distribution of the proceeds thereof.  The Participation Interests are the
“Closing Date Participation Interests” referred to in the Loan Sale Agreement
and in the Indenture.

 

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SECTION 2.02              Income Collections; Payments of Income Collections and
Other Payments Received After the Settlement Date.

 

(a)                                 With respect to each Transferred Asset, the
Issuer shall all rights to Income Collections that, as of the Settlement Date,
are accrued but unpaid with respect to the period from and after the Settlement
Date.

 

(b)                                 If at any time after the Settlement Date the
Closing Date Seller receives any Income Collections in respect of the
Transferred Assets, the Closing Date Seller shall deliver (or cause to be
delivered), and the Collateral Agent hereby acknowledges and agrees to release,
promptly to the Issuer such Income Collections.  If at any time after the
Settlement Date the Closing Date Seller receives any other payment (including
principal, interest (to the extent relating to the period from and after the
Settlement Date) or any other amount) with respect to a Transferred Asset, the
Closing Date Seller shall deliver (or cause to be delivered) such payment
promptly to the Issuer.

 

(c)                                  Without limiting the foregoing, the Closing
Date Seller agrees (a) until the Elevation of each Transferred Asset has been
completed, to maintain its existing custodial arrangements and bank accounts
established to receive proceeds of such Transferred Asset and (b) to remit (or
cause to be remitted) to the Issuer, promptly (but not more than two Business
Days) after receipt of such payment and identification thereof, each payment
received in connection with each Transferred Asset to which the Issuer is
entitled in accordance with Section 2.01.  The Closing Date Seller acknowledges
that from and after the Settlement Date it shall have no equitable or beneficial
interest in any payment received by it with respect to any Transferred Asset
(other than any accrued and unpaid interest with respect to the period of time
prior to and excluding the Settlement Date).

 

SECTION 2.03              Treatment of Transfer; Backup Grant of Security
Interest.

 

(a)                                 Each party hereto (i) agrees that each
Transfer shall be a sale of the relevant Transferred Asset for all relevant
purposes (other than tax and accounting purposes) and (ii) intends, and has as
its business objective, that each Transfer be an absolute transfer and not be a
transfer as security for a loan.  The relationship between the Closing Date
Seller and the Issuer shall be that of seller and buyer.  Neither party is a
trustee or agent for the other party, nor does either party have any fiduciary
obligations to the other party.  This Agreement shall not be construed to create
a partnership or joint venture between the parties hereto.

 

(b)                                 If, notwithstanding such intention, any
Transfer is characterized by a court of competent jurisdiction as a transfer as
security for a loan rather than a sale of a participation interest in the
relevant Transferred Asset, or any Transfer shall for any reason be ineffective
to transfer to the Issuer all of the Closing Date Seller’s right, title and
interest in any Transferred Asset (including the Income Collections received by
it with respect to such Transferred Asset), then the Closing Date Seller shall
be deemed to have granted to the Issuer, and the Closing Date Seller hereby
grants to the Issuer, a security interest in and lien on all the Closing Date
Seller’s right, title and interest in and to such Transferred Asset (including
the Income Collections received by the Closing Date Seller with respect to such
Transferred Asset), whether now existing or

 

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hereafter acquired, in order to secure such loan and all other obligations of
the Closing Date Seller hereunder.

 

(c)                                  After the Settlement Date, the Closing Date
Seller shall record in the Closing Date Seller’s books and records the fact that
the Closing Date Seller is no longer the beneficial owner of the Transferred
Assets conveyed to the Issuer hereunder and, after the relevant Elevation Date
with respect to any Transferred Asset, the Closing Date Seller shall record in
the Closing Date Seller’s books and records the fact that the Closing Date
Seller is no longer the record owner or beneficial owner of such Transferred
Asset.  After the Settlement Date, the Issuer shall record in the Issuer’s books
and records that fact that the Issuer is the beneficial owner of the Transferred
Assets and, after the relevant Elevation Date with respect to any Transferred
Asset, the Issuer shall record in the Issuer’s books and records the fact that
the Issuer is the record owner and beneficial owner of such Transferred Asset. 
The parties hereto acknowledge and agree that, with respect to
Partially-Participated Assets, the Closing Date Seller shall remain the record
and beneficial owner of the portion of the Collateral Obligation not so sold to
the Issuer hereunder, and the Closing Date Seller’s books and records shall
reflect such understanding.

 

SECTION 2.04              Documents; Exercise of Rights and Remedies;
Indemnification.

 

(a)                                 Prior to Elevation, the Closing Date Seller
shall furnish to the Issuer (or its collateral administrator) copies of any
Underlying Instruments and applicable credit documentation in its possession in
respect of a Transferred Asset and, as and when available to the Closing Date
Seller (without prejudice to Section 2.05(b)), a copy of each transfer document
or assignment agreement (or, in the case of any Underlying Instrument that is in
the form of a note, any chain of endorsement), amendment, consent or waiver in
connection with any such documentation, provided that the Closing Date Seller is
not prohibited from doing so under the related Underlying Instruments or
applicable credit documentation after taking into account the next sentence. 
The Issuer agrees that it shall maintain the confidentiality of any such
documents to the extent required therein and to the same extent as if it were a
party thereto and shall, upon the Closing Date Seller’s request, provide to the
Closing Date Seller a confidentiality undertaking to such effect in accordance
with the terms of the such documentation prior to the delivery thereof.

 

(b)                                 From and after the Settlement Date, the
Closing Date Seller agrees to promptly forward to the Issuer and the Portfolio
Manager all notices, requests, reports and communications of any nature received
from any Person with respect to each Transferred Asset.  Unless restricted or
prohibited under applicable law, rule, order or the relevant Underlying
Instruments and/or credit documentation, the Closing Date Seller will not
exercise any voting, consent or other right or remedy, or take or refrain from
taking any action, in each case with respect to any Transferred Asset, except as
directed by the Issuer.  With respect to the exercise of any such voting,
consent or other right or remedy, or the taking or refraining from taking any
action with respect to any Transferred Asset, pursuant to the preceding
sentence, which is not directed by the Portfolio Manager on behalf of the
Issuer, the Closing Date Seller will consult with the Issuer with respect
thereto and the Closing Date Seller will take such action or refrain from taking
such action as the Closing Date Seller would take if such Transferred Asset were
beneficially owned by the Closing Date Seller for its own account.

 

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(c)                                  Provided that the Portfolio Manager on
behalf of the Issuer has directed the Closing Date Seller to take such action
and the Closing Date Seller does so, the Issuer shall reimburse the Closing Date
Seller for any and all liabilities, obligations, actual losses, actual damages,
penalties, actions, judgments, suits, costs, expenses, and disbursements,
including legal fees, which may be incurred or made by the Closing Date Seller
in connection with any such action so taken by the Closing Date Seller for which
the Closing Date Seller is not reimbursed at any time by or on behalf of any
Obligor under any applicable Underlying Instruments or credit documentation
(other than any thereof resulting from the Closing Date Seller’s gross
negligence or willful misconduct).  In no event will the Issuer reimburse the
Closing Date Seller for any special, indirect, consequential or punitive damages
in respect to any claim hereunder, whether or not accrued, and whether or not
known or suspected.  In no event will the Closing Date Seller reimburse the
Issuer for any special, indirect, consequential or punitive damages in respect
to any claim hereunder, whether or not accrued, and whether or not known or
suspected.

 

SECTION 2.05              Elevation.

 

(a)                                 Subject to the terms and provisions of the
applicable Transferred Assets and of applicable law, the Closing Date Seller
shall use commercially reasonable efforts to effect an Elevation, as soon as
reasonably practicable, with respect to each such Transferred Asset and take
such action (including the execution and delivery of any transfer document or
assignment agreement (or, in the case of any Underlying Instrument that is in
the form of a note, any chain of endorsement)) as shall be reasonably necessary
in connection therewith and in accordance with the terms and conditions of each
such Transferred Asset and consistent with the terms of this Agreement.  The
Closing Date Seller has prepared individual assignments (or a master assignment)
consistent with the requirements of the related Underlying Instruments and
provided them to the Persons required under such Underlying Instruments, which
assignments will become effective in accordance with such Underlying Instruments
upon obtaining certain consents thereto or upon the passage of time or both. 
The Closing Date Seller shall pay any transfer fees and other expenses payable
in connection with an Elevation and the Issuer will reimburse the Closing Date
Seller for half of such fees and expenses after receipt of an invoice therefor
from the Closing Date Seller detailing such amounts.  The Issuer shall be
responsible for any expenses of administering each Transferred Asset prior to
its Elevation.  At Elevation, the Closing Date Seller shall deliver such
assignment and the credit documentation (or, solely in the case of any
Partially-Participated Assets, copies of the credit documentation) with respect
to the related Transferred Asset in its possession to or as directed by the
Issuer.  The Issuer and the Closing Date Seller acknowledge and agree that,
solely for administrative convenience, any transfer document or assignment
agreement (or, in the case of any Underlying Instrument that is in the form of a
note, any chain of endorsement) required to be executed and delivered in
connection with the transfer of a Transferred Asset in accordance with the terms
of any related Underlying Instruments may reflect that (i) the Closing Date
Seller is assigning such Transferred Asset directly to the Issuer or (ii) the
Issuer is acquiring such Transferred Asset at the closing of such Transferred
Asset.  Nothing in any such transfer document or assignment agreement (or, in
the case of any Underlying Instrument that is in the form of a note, nothing in
such chain of endorsement) shall be deemed to impair the transfers of the
Transferred Assets by the Closing Date Seller to the Issuer in accordance with
the terms of this Agreement.

 

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(b)                                 The Closing Date Seller shall (so far as the
same is within its power and control) maintain its existence as a Delaware
limited liability company until an Elevation has been effected with respect to
each Transferred Asset.  If the Closing Date Seller has not effected an
Elevation of a Transferred Asset on or before the day that is 120 days from the
Settlement Date for whatever reason or if at any time prior thereto the Closing
Date Seller is dissolved prior to effecting an Elevation, the Closing Date
Seller agrees that, following any such date, the Issuer shall be permitted to
take any and all action necessary to effectuate an Elevation and/or finalize an
assignment of any of the Transferred Assets, and in furtherance of the
foregoing, effective immediately upon such date, the Closing Date Seller hereby
makes, constitutes and appoints the Issuer, with full power of substitution, as
its true and lawful agent and attorney-in-fact, with full power and authority in
its name, place and stead, to sign, execute, certify, swear to, acknowledge,
deliver, file, receive and record any and all documents that the Issuer
reasonably deems appropriate or necessary in connection with any Elevation or
finalization of an assignment of any of the Transferred Assets. In addition, the
Closing Date Seller, effective as of the Settlement Date, hereby makes,
constitutes and appoints the Issuer, with full power of substitution, as its
true and lawful agent and attorney-in-fact, with full power and authority in its
name, place and stead, to sign, execute, certify, swear to, acknowledge,
deliver, file, receive and record any and all documents that the Issuer
reasonably deems appropriate or necessary to direct the applicable Obligor or
agent bank with respect to any Transferred Asset to deposit directly into an
account chosen by the Issuer with notice to the Closing Date Seller, the Income
Collections in respect of any Transferred Asset.  The foregoing powers of
attorney are hereby declared to be irrevocable and a power coupled with an
interest, and shall survive and not be affected by the bankruptcy or insolvency
or dissolution of the Closing Date Seller.

 

SECTION 2.06              Payments to Issuer.  On or prior to the date of this
Agreement, the Closing Date Seller has directed Wells Fargo Bank, National
Association, in its capacity as Collateral Agent under the Credit Agreement, to
release the Collateral Obligations set forth on Annex A hereto from the lien of
the Collateral Agent for the benefit of the secured parties under the Credit
Agreement and to release to the Issuer all payments and distributions in respect
of such Collateral Obligations (including Income Collections thereon) received
by the Collateral Agent and due to the Issuer pursuant to the terms of this
Agreement.  The Collateral Agent acknowledges and agrees that the Collateral
Obligations listed on Annex A hereto have been released from the lien of the
Collateral Agent for the benefit of the secured parties under the Credit
Agreement, that all conditions precedent thereto have been satisfied, and that
the Collateral Agent will release to the Issuer all payments and distributions
in respect of such Collateral Obligations (including Income Collections thereon)
received by the Collateral Agent and due to the Issuer pursuant to the terms of
this Agreement

 

SECTION 2.07              Conduct of Business.  The Closing Date Seller
represents, warrants and agrees that, from and after the Settlement Date, it
will not engage in any activities with respect to the Transferred Assets other
than holding record ownership of the Transferred Assets, receiving payments in
respect of the Transferred Assets and remitting (or causing to be remitted) to
the Issuer such payments as required hereunder, effecting Elevations with
respect to the Transferred Assets and performing its other agreements hereunder
with respect to such Transferred Assets.  The Closing Date Seller represents,
warrants and agrees that, from and after the date hereof, it shall not sell,
grant a security interest in or lien on, or otherwise pledge, mortgage,
hypothecate or encumber (or permit such to occur or suffer such to exist other
than any security interest therein which will

 

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be released contemporaneously with the Transfer of such Transferred Asset
hereunder and the grant of the security interest therein granted by the Closing
Date Seller to the Issuer hereunder), any part of the Transferred Assets except
for the grant of the Participation Interests to the Issuer as provided herein.

 

SECTION 2.08              Further Assurances.  Each party agrees to execute and
deliver all such further documents as may be reasonably requested by the other
party in order to effect each Transfer and each Elevation as contemplated
hereby.

 

ARTICLE III
Representations and Warranties

 

SECTION 3.01              Representations and Warranties of Each Party.  Each
party hereto (each, the “Representing Party”) represents and warrants to the
other party as follows:

 

(i)                                     the Representing Party is duly
incorporated or formed, as applicable, and validly existing as an entity and is
in good standing under the laws of its jurisdiction of incorporation;

 

(ii)                                  the Representing Party has the requisite
power and authority to enter into and perform this Agreement;

 

(iii)                               this Agreement has been duly authorized by
all necessary action on the part of the Representing Party, has been duly
executed by the Representing Party and is the valid and binding agreement of the
Representing Party enforceable against such party in accordance with its terms;

 

(iv)                              the Representing Party is adequately
capitalized in light of its contemplated business or activities;

 

(v)                                 no Transfer will be a transfer of property
in connection with any preexisting indebtedness owed by the Closing Date Seller
to the Issuer;

 

(vi)                              there are no agreements or understandings
between the Representing Parties (other than this Agreement) relating to or
affecting the Transfer or the Transferred Assets and the proceeds thereof;

 

(vii)                           the Representing Party conducts its business or
activities solely in its own name;

 

(viii)                        the Representing Party provides for the payment of
its expenses and liabilities from its own funds;

 

(ix)          the Representing Party has not guaranteed and is not otherwise
contractually liable for the payment of any liability of the other party;

 

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(x)                                 neither the assets nor the creditworthiness
of the Representing Party is generally held out as being available for the
payment of any liability of the other party;

 

(xi)                              the Representing Party maintains an
arm’s-length relationship with the other party;

 

(xii)                           the Representing Party maintains separate
financial records that enable its assets to be readily ascertained as separate
and apart from those of the other party;

 

(xiii)                        the Representing Party’s funds are not commingled
with those of the other party; and

 

(xiv)                       none of the execution, delivery and performance of
this Agreement by the Representing Party will:

 

(A)                               conflict with, result in any breach of or
constitute a default (or an event which, with the giving of notice or passage of
time, or both, would constitute a default) under, any term or provision of the
organizational documents of the Representing Party or any indenture, agreement,
order, decree or other instrument to which the Representing Party is a party or
by which the Representing Party is bound, which conflict, breach or default
would have a material adverse effect with respect to the Representing Party; or

 

(B)                               violate any provision of any law, rule or
regulation applicable to the Representing Party of any regulatory body,
administrative agency or other governmental instrumentality having jurisdiction
over the Representing Party or its properties, which violation would have a
material adverse effect with respect to the Representing Party.

 

SECTION 3.02              Representations and Warranties of the Closing Date
Seller.  The Closing Date Seller represents and warrants to the Issuer as
follows:

 

(i)                                     Upon the Elevation on the relevant
Elevation Date with respect to any Transferred Asset, the Issuer will receive
good and marketable title to such Transferred Asset, free and clear of any
pledge, lien, investment interest, charge, claim, equity or encumbrance of any
kind created by the Closing Date Seller or any Person claiming through the
Closing Date Seller.  The participation in each Transferred Asset granted
hereunder will be granted by the Closing Date Seller to the Issuer free and
clear of any encumbrance, equity, participation interest, lien, pledge, charge,
claim or security interest (other than any security interest therein which will
be released contemporaneously with the Transfer of such Transferred Asset
hereunder, the security interest granted hereunder by the Closing Date Seller to
the Issuer and Closing Date Seller’s record ownership of the related Transferred

 

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Asset which, from and after the Settlement Date to and including the Elevation
Date with respect thereto will be and remain free and clear of any encumbrance,
equity, participation interest, lien, pledge, charge, claim or security
interest). There is no funding obligation in respect of the Transferred Assets
that the Issuer is or shall be required to pay or otherwise perform that the
Closing Date Seller has not paid or otherwise performed in full.

 

(ii)                                  None of the execution, delivery and
performance by the Closing Date Seller of this Agreement will adversely affect
the nature of the title to any Transferred Asset received by the Issuer as
provided in Section 3.02(i).

 

(iii)                               No consent, license, approval or
authorization from, or registration or qualification with, any governmental
body, agency or authority, nor any consent, approval, waiver or notification of
any creditor or lessor is required in connection with the execution, delivery
and performance by the Closing Date Seller of this Agreement, except (A) such as
have been obtained and are in full force and effect or (B) those with respect to
which the failure to obtain them would not have a material adverse effect with
respect to the Closing Date Seller.

 

(iv)                              The Closing Date Seller has valid business
reasons for transferring the Transferred Assets to the Issuer rather than
obtaining a secured loan with the Transferred Assets as collateral.  The Closing
Date Seller is not effecting any Transfer in contemplation of the Closing Date
Seller’s insolvency or with any actual intent to hinder, delay or defraud any of
its creditors.

 

(v)                                 All corporate actions of the Closing Date
Seller, with respect to the transactions contemplated hereby, have been and will
continue to be reflected in any minutes of the Closing Date Seller.  This
Agreement is and will continue to be an official record of the Closing Date
Seller.

 

(vi)                              The Closing Date Seller has been solvent at
all relevant times before each Transfer and will not be rendered insolvent by
any Transfer.  Before the date hereof, the Closing Date Seller did not engage in
or have plans to engage in any business or transaction as a result of which the
total assets remaining with the Closing Date Seller would constitute an
unreasonably small amount of capital.  The Closing Date Seller has not incurred
and does not intend to incur, debts that would be beyond its ability to pay as
they mature.

 

SECTION 3.03              No Liability.  The Closing Date Seller makes no
representation or warranty, express or implied, and assumes no responsibility,
with respect to the genuineness, authorization, execution, delivery, validity,
legality, value, sufficiency, perfection, priority, enforceability or
collectability of any Underlying Instruments or credit documentation executed
and delivered in connection with a Transferred Asset.  The Closing Date Seller
assumes no responsibility for (except as otherwise expressly provided herein)
(a) any representation or warranty made by, or the accuracy, completeness,
correctness or sufficiency of any information (or the validity, completeness or
adequate disclosure of assumptions underlying any estimates, forecasts or
projections contained in such information) provided directly or indirectly by,
any obligor in respect

 

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of a Transferred Asset or any Underlying Instruments or credit documentation
thereof or by any other Person, (b) the performance or observance by any obligor
of any of the provisions of any Underlying Instruments or credit documentation
in respect of a Transferred Asset (whether on, before or after the Settlement
Date), (c) the filing, recording, or taking of any action with respect to any
Underlying Instruments or credit documentation in respect of a Transferred
Asset, (d) the financial condition of any obligor in respect of a Transferred
Asset or of any other Person or (e) any other matter whatsoever relating to any
obligor in respect of a Transferred Asset, any other Person or the Transferred
Assets.

 

In making, managing, handling and transferring the Transferred Assets, the
Closing Date Seller shall exercise the same care as it normally exercises with
respect to loans held for its own account, but the Closing Date Seller shall
have no further responsibility to the Issuer except as expressly provided herein
and except for its own gross negligence or willful misconduct which results in
actual loss to the Issuer.

 

ARTICLE IV
Miscellaneous

 

SECTION 4.01              Amendments.  This Agreement may not be amended,
altered, supplemented or otherwise modified, except by the execution and
delivery of a written agreement by each of the parties hereto.

 

SECTION 4.02              Communications.  Except as may be otherwise agreed
between the parties, all communications hereunder shall be made in writing to
the relevant party by personal delivery or by courier or first-class mail by
facsimile or email transmission as follows:

 

To the Closing Date Seller:

 

BCSF II-C, LLC

200 North Clarendon Street, 36th Floor

Boston, Massachusetts 02116

Email: baincapitalcreditdocs@baincapital.com

Attention: Michael Treisman

 

To the Issuer:

 

BCC Middle Market CLO 2019-1, LLC

c/o Bain Capital Specialty Finance, Inc.

200 Clarendon Street, 37th Floor

Boston, Massachusetts 02116

Email: baincapitalcreditdocs@baincapital.com

Attention: Michael Boyle

 

or to such other address, telephone number or facsimile number as either party
may notify to the other party in accordance with the terms hereof from time to
time.  Any communications hereunder shall be effective upon receipt.

 

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SECTION 4.03              Governing Law; Waiver of Trial by Jury; Jurisdiction.

 

(a)                                 This Agreement shall be construed in
accordance with the law of the State of New York, and this Agreement, and all
matters arising out of or relating in any way whatsoever to this Agreement
(whether in contract, tort or otherwise), shall be governed by such law without
reference to its conflicts of laws provisions (other than Section 5-1401 of the
New York General Obligations Law).

 

(b)                                 EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER
OR IN CONNECTION WITH THIS AGREEMENT. Each party hereto (i) certifies that no
representative, agent or attorney of any other party has represented, expressly
or otherwise, that such other party would not, in the event of litigation, seek
to enforce the foregoing waiver and (ii) acknowledges that it and the other
parties hereto have been induced to enter into this Agreement by, among other
things, the mutual waivers and certifications in this Section 4.03(b).

 

(c)                                  Each party hereto hereby irrevocably
submits to the non-exclusive jurisdiction of any New York State or Federal court
sitting in the Borough of Manhattan in The City of New York in any action or
proceeding arising out of or relating this Agreement, and hereby irrevocably
agrees that all claims in respect of such action or proceeding may be heard and
determined in such New York State or Federal court. Each party hereto hereby
irrevocably waives, to the fullest extent that it may legally do so, the defense
of an inconvenient forum to the maintenance of such action or proceeding. Each
party hereto irrevocably consents to the service of any and all process in any
action or proceeding by the mailing or delivery of copies of such process to it
the address set forth in Section 4.02. Each party hereto agrees that a final
judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law.

 

SECTION 4.04              Non-Petition; Limited Recourse.

 

(a)                                 Notwithstanding any other provision of this
Agreement, the Closing Date Seller agrees that it may not, prior to the date
which is one year and one day (or if longer, any applicable preference period
then in effect plus one day) after the payment in full of all Debt and any other
debt obligations of the Issuer that have been rated upon issuance by any rating
agency at the request of the Issuer, institute against, or join any other Person
in instituting against, the Issuer any bankruptcy, reorganization, arrangement,
insolvency, winding-up, moratorium or liquidation Proceedings, or other
Proceedings under U.S. federal or state bankruptcy or similar laws.  Nothing in
this Section 4.04(a) shall preclude, or be deemed to stop, the Closing Date
Seller:

 

(i)                                     from taking any action prior to the
expiration of the aforementioned period in (A) any case or Proceeding
voluntarily filed or commenced by the Issuer or (B) any involuntary insolvency
Proceeding filed or commenced by a Person other than the Issuer; or

 

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(ii)                                  from commencing against the Issuer or any
of its properties any legal action which is not a bankruptcy, reorganization,
arrangement, insolvency, winding-up, moratorium or liquidation Proceeding.

 

(b)                                 Notwithstanding any other provision of this
Agreement, the Issuer agrees that it may not, prior to the date which is one
year and one day (or if longer, any applicable preference period then in effect
plus one day) after the payment in full of all “Obligations” (as defined in the
Credit Agreement) of the Closing Date Seller and the termination of all
“Commitments” (as defined in the Credit Agreement), in each case under the
Credit Agreement, institute against, or join any other Person in instituting
against, the Closing Date Seller any bankruptcy, reorganization, arrangement,
insolvency, winding-up, moratorium or liquidation Proceedings, or other
Proceedings under U.S. federal or state bankruptcy or similar laws.  Nothing in
this Section 4.04(b) shall preclude, or be deemed to stop, the Issuer:

 

(i)                                     from taking any action prior to the
expiration of the aforementioned period in (A) any case or Proceeding
voluntarily filed or commenced by the Closing Date Seller or (B) any involuntary
insolvency Proceeding filed or commenced by a Person other than the Closing Date
Seller; or

 

(ii)                                  from commencing against the Closing Date
Seller or any of its properties any legal action which is not a bankruptcy,
reorganization, arrangement, insolvency, winding-up, moratorium or liquidation
Proceeding.

 

(c)                                  Notwithstanding any other provision of this
Agreement:

 

(i)                                     The obligations of the parties under
this Agreement are at all times limited recourse obligations of such party
payable solely from such party’s assets available at such time, and, following
realization of such assets and application of the proceeds thereof (including,
in the case of the Issuer, in accordance with the applicable priority of
payments under the Indenture and, in the case of the Closing Date Seller, in
accordance with the applicable priority of payments under the Credit Agreement),
all obligations of and any claims against such party hereunder or in connection
herewith after such realization shall be extinguished and shall not thereafter
revive.

 

(ii)                                  No recourse shall be had against any
officer, director, employee, shareholder, member, manager, beneficial owner,
trustee, authorized person or incorporator of either party or its manager or
their respective affiliates, successors or assigns for any amounts payable under
this Agreement.

 

(iii)                               The foregoing provisions of this
Section 4.04(c) shall not:

 

(A)                               prevent recourse to such party’s assets for
the sums due or to become due under any security, instrument or agreement that
is part of such assets;

 

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(B)                               constitute a waiver, release or discharge of
any indebtedness or obligation evidenced by this Agreement until all such assets
have been realized; or

 

(C)                               limit the right of either party to name the
other party as a party defendant in any Proceeding or in the exercise of any
other remedy under this Agreement, so long as no judgment in the nature of a
deficiency judgment or seeking personal liability shall be asked for or (if
obtained) enforced against any Person referred to in Section 4.04(c)(ii).

 

(d)                                 This Section 4.04 shall survive the
termination of this Agreement and the payment in full of all Debt pursuant to
the Indenture and related Transaction Documents and the payment in full of all
“Obligations” (as defined in the Credit Agreement) of the Closing Date Seller
under the Credit Agreement.

 

SECTION 4.05              Parties Benefited.

 

(a)                                 This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
permitted assigns.  Neither this Agreement nor any right or obligation in or
under this Agreement may be transferred (whether by way of security or
otherwise) or delegated by either party without the prior written consent of the
other party, except that (i) a party may make a transfer of all (but not less
than all) of its rights and obligations under this Agreement pursuant to a
consolidation or amalgamation with, or merger with or into, or transfer of all
or substantially all its assets to, another entity, and (ii) the Issuer may
assign and transfer its rights hereunder to the Trustee under the Indenture. 
Any purported transfer that is not in compliance with this provision will be
void.

 

(b)                                 No Person shall be a third party beneficiary
of this Agreement.

 

SECTION 4.06              Severability.  If any term, provision, covenant or
condition of this Agreement, or the application thereof to the Closing Date
Seller or the Issuer or any circumstance, is held to be unenforceable, invalid
or illegal (in whole or in part) for any reason (in any relevant jurisdiction),
the remaining terms, provisions, covenants and conditions of this Agreement,
modified by the deletion of the unenforceable, invalid or illegal portion (in
any relevant jurisdiction), will continue in full force and effect, and such
unenforceability, invalidity, or illegality will not otherwise affect the
enforceability, validity or legality of the remaining terms, provisions,
covenants and conditions of this Agreement so long as this Agreement as so
modified continues to express, without material change, the original intentions
of the Closing Date Seller and the Issuer as to the subject matter hereof and
the deletion of such portion of this Agreement will not substantially impair the
respective expectations of the Closing Date Seller and the Issuer or the
practical realization of the benefits hereof that would otherwise be conferred
upon the Closing Date Seller and the Issuer.  The Closing Date Seller and the
Issuer will endeavor in good faith to replace the prohibited or unenforceable
provision with a valid provision, the economic effect of which comes as close as
possible to that of the prohibited or unenforceable provision.

 

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SECTION 4.07              Counterparts.  This Agreement (and each amendment,
modification and waiver in respect of it) may be executed in any number of
counterparts (including by facsimile transmission or other form of electronic
transmission), each of which shall be an original, but all of which together
shall constitute one and the same agreement.  Delivery of an executed
counterpart signature page of this Agreement by facsimile transmission or by
electronic transmission (.pdf) shall be effective as delivery of a manually
executed counterpart of this Agreement.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and delivered as a deed as of the date first written above.

 

 

 

BCSF II-C, LLC,

 

as Closing Date Seller

 

 

 

 

 

By:

/s/ Andrew S. Viens

 

 

Name:

Andrew S. Viens

 

 

Title:

Managing Director

 

 

 

 

BCC MIDDLE MARKET CLO 2019-1, LLC,

 

as Issuer

 

 

 

By: Bain Capital Specialty Finance, Inc.,

 

its designated manager

 

 

 

 

 

By:

/s/ Sally Dornaus

 

 

Name:

Sally Dornaus

 

 

Title:

Chief Financial Officer

 

 

ACKNOWLEDGED:

 

BAIN CAPITAL SPECIALTY FINANCE, INC.,

 

as Transferor

 

 

 

 

 

By:

/s/ Andrew S. Viens

 

 

Name: Andrew S. Viens

 

 

Title: Managing Director

 

 

[Signatures continue on the following page.]

 

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ACKNOWLEDGED AND AGREED:

 

 

WELLS FARGO BANK, NATIONAL ASSOCIATION,

 

as Collateral Agent under the Credit Agreement

 

 

 

 

 

By:

/s/ Michael J. Baker

 

 

Name:

Michael J. Baker

 

 

Title:

Vice President

 

 

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ANNEX A

 

SCHEDULE OF TRANSFERRED ASSETS

 

[Attached]

 

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