Exhibit 10.1

ASSET PURCHASE AGREEMENT

dated as of November 1, 2017

by and between

Ares Capital Corporation, as Seller, and

Bearcub Acquisitions LLC, as Buyer

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TABLE OF CONTENTS

 

         Page  

ARTICLE I DEFINITIONS

     1  

Section 1.01.

 

Certain Defined Terms

     1  

ARTICLE II PURCHASE AND SALE; CLOSING

     1  

Section 2.01.

 

Purchase and Sale of Assets

     1  

Section 2.02.

 

Other Closing Matters

     3  

Section 2.03.

 

Closing

     3  

ARTICLE III PURCHASE PRICE

     3  

Section 3.01.

 

Purchase Price

     3  

Section 3.02.

 

Certain Closing-Related Deliverables

     4  

Section 3.03.

 

Closing Date Payment

     4  

Section 3.04.

 

Post-Closing Statement

     4  

Section 3.05.

 

Reconciliation of Post-Closing Statements

     5  

Section 3.06.

 

Post-Closing Adjustment

     5  

ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE SELLER

     6  

Section 4.01.

 

Incorporation and Authority of the Seller Parties; Enforceability

     6  

Section 4.02.

 

No Conflict

     6  

Section 4.03.

 

Consents and Approvals

     7  

Section 4.04.

 

Absence of Litigation

     7  

Section 4.05.

 

Taxes

     7  

Section 4.06.

 

Brokers

     7  

Section 4.07.

 

Title

     7  

Section 4.08.

 

Loan Agreements

     7  

Section 4.09.

 

Transferred Equity

     8  

Section 4.10.

 

Disclaimer of Warranties

     8  

ARTICLE V REPRESENTATIONS AND WARRANTIES OF THE BUYER

     8  

Section 5.01.

 

Incorporation and Authority of Buyer

     8  

Section 5.02.

 

No Conflict

     9  

Section 5.03.

 

Consents and Approvals

     9  

Section 5.04.

 

Securities Matters

     9  

 

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TABLE OF CONTENTS

(continued)

 

         Page  

Section 5.05.

 

Brokers

     9  

Section 5.06.

 

Availability of Funds

     9  

Section 5.07.

 

Independent Investigation

     9  

ARTICLE VI ADDITIONAL AGREEMENTS

     10  

Section 6.01.

 

Non-Disclosure

     10  

Section 6.02.

 

Non-Solicitation

     10  

ARTICLE VII FURTHER ASSURANCES

     11  

Section 7.01.

 

Further Assurances

     11  

Section 7.02.

 

Collateral Actions and Costs and Expenses

     11  

Section 7.03.

 

Non-Fiduciary Bailee

     12  

ARTICLE VIII TAX MATTERS

     13  

Section 8.01.

 

Transfer Taxes

     13  

Section 8.02.

 

Cooperation

     13  

ARTICLE IX INDEMNIFICATION

     13  

Section 9.01.

 

Survival

     13  

Section 9.02.

 

Indemnification by the Seller

     14  

Section 9.03.

 

Indemnification by the Buyer

     14  

Section 9.04.

 

Notification of Claims

     14  

Section 9.05.

 

Exclusive Remedies

     15  

Section 9.06.

 

Limitations

     15  

Section 9.07.

 

Additional Indemnification Provisions

     15  

Section 9.08.

 

Effect of Investigation

     15  

Section 9.09.

 

Certain Indemnity Matters

     16  

ARTICLE X MISCELLANEOUS

     16  

Section 10.01.

 

Rules of Construction

     16  

Section 10.02.

 

Expenses

     17  

Section 10.03.

 

Notices

     17  

Section 10.04.

 

Public Announcements

     18  

Section 10.05.

 

Severability

     18  

Section 10.06.

 

Assignment

     18  

 

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TABLE OF CONTENTS

(continued)

 

         Page  

Section 10.07.

 

No Third-Party Beneficiaries

     19  

Section 10.08.

 

Entire Agreement

     19  

Section 10.09.

 

Amendments

     19  

Section 10.10.

 

Waiver

     19  

Section 10.11.

 

Counterparts

     19  

Section 10.12.

 

Governing Law

     19  

Section 10.13.

 

Dispute Resolution; Consent to Jurisdiction

     19  

Section 10.14.

 

Waiver of Jury Trial

     20  

Section 10.15.

 

Specific Performance

     20  

Section 10.16.

 

Disclosure Schedule

     21  

EXHIBITS AND SCHEDULES

 

Exhibit A    Definitions Schedule A    Loan Agreements and Warrants to be
Transferred at Closing Schedule B    Collateral Disclosure Schedule   
Disclosure Schedule

 

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This ASSET PURCHASE AGREEMENT, dated as of November 1, 2017, is made by and
between Ares Capital Corporation, a Maryland corporation (the “Seller” and,
together with each Seller Designee permitted pursuant to this Agreement, the
“Seller Parties”), and Bearcub Acquisitions LLC, a Delaware limited liability
company (the “Buyer”).

PRELIMINARY STATEMENTS

A. The Seller owns or controls, directly or indirectly, each of the other Seller
Parties.

B. At the Closing, the Seller Parties desire to sell to the Buyer, and the Buyer
desires to purchase from the Seller Parties, certain of the assets of the Seller
Parties, and the Buyer desires to assume certain Liabilities of the Seller
Parties, in each case, upon the terms and subject to the conditions set forth in
this Agreement.

NOW, THEREFORE, in consideration of the foregoing and the representations,
warranties, covenants and agreements set forth in this Agreement, and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Parties, intending to be legally bound, agree as follows:

ARTICLE I

DEFINITIONS

Section 1.01. Certain Defined Terms. Capitalized terms used in this Agreement
have the meanings specified in Exhibit A.

ARTICLE II

PURCHASE AND SALE; CLOSING

Section 2.01. Purchase and Sale of Assets.

(a) Transferred Assets. On the terms and subject to the conditions set forth in
this Agreement and subject to the exclusions set forth in Section 2.01(b) and
Section 2.02(a), at the Closing each of the applicable Seller Parties shall
sell, convey, assign, transfer and deliver to the Buyer, and the Buyer shall
purchase, acquire and accept from such Seller Party, all of such Seller Party’s
right, title and interest in, to and under the following assets, properties and
rights, free and clear of all Liens, other than Permitted Liens (collectively,
the “Transferred Assets”):

(i) all rights under the Loan Agreements (the “Transferred Loan Agreements”),
including (A) all interest and other amounts (including the Fees) due and
payable from the Obligors in respect of such Transferred Loan Agreements from
and after the Closing and (B) subject to Article VII hereof, all security
interests in any Collateral;

(ii) the Transferred Equity, including all dividends, distributions and other
amounts due and payable from the issuers in respect of the Transferred Equity
from and after the Closing;

(iii) all amounts of cash and other assets held in escrow by a Seller Party for
the benefit of an Obligor under such Transferred Loan Agreements;

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(iv) all receivables and amounts (whether accrued, contingent, owing or payable
in the future) as of the Closing Date related to the Fees; and

(v) all rights, claims, causes of action (including counterclaims) and defenses
(other than those defenses related to any pre-Closing Action) relating to such
Transferred Assets and Assumed Liabilities.

(b) Excluded Assets. Only the Transferred Assets shall be transferred to the
Buyer and all other assets, rights and properties of the Seller Parties (the
“Excluded Assets”) shall be retained by the Seller Parties and their respective
Affiliates and shall be excluded from the Transferred Assets notwithstanding any
other provision of this Agreement, including:

(i) all cash and cash equivalents solely to the extent relating to the Excluded
Assets (and, for the avoidance of doubt, excluding any cash and cash equivalents
required to be paid to the Buyer pursuant to Section 2.02(a));

(ii) all rights, claims, causes of action (including counterclaims) and defenses
(including those defenses related to any pre-Closing Action) relating to the
Excluded Assets or Excluded Liabilities;

(iii) any Permits held by any Seller Party;

(iv) all intellectual property of any Seller Party unless such intellectual
property was acquired by such Seller Party as a result of foreclosure or similar
actions taken by such Seller Party against the Obligor under any Transferred
Loan Agreement; and

(v) any rights of any of the Seller Parties under the Transaction Agreements.

(c) Assumed Liabilities. On the terms and subject to the conditions set forth in
this Agreement and subject to the exclusions set forth in Section 2.01(d), the
Buyer shall, effective at the time of the Closing, assume and thereafter timely
pay, discharge and perform in accordance with their terms, all Liabilities of
the Seller Parties solely to the extent arising from or related to the
Transferred Assets and Transferred Credit Documents that arise from and after
the Closing and excluding any Liability relating to periods prior to the Closing
(including any lender liability claims) and excluding any Liabilities that are
asserted after the Closing Date but arise out of or relate to any action or
omission of the Seller Parties that occurs prior to the Closing (the “Assumed
Liabilities”).

(d) Excluded Liabilities. The Buyer is not assuming or agreeing to pay,
discharge or otherwise become liable for any Liabilities other than the Assumed
Liabilities, and, without limiting the foregoing, no Liabilities of any Seller
Party, other than the Assumed Liabilities, shall be assumed by the Buyer,
notwithstanding any other provision of this Agreement (the “Excluded
Liabilities”). The Excluded Liabilities shall include the following Liabilities
of any Seller Party:

(i) any indebtedness;

 

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(ii) any Liability to the extent relating to any Excluded Asset; and

(iii) any Excluded Taxes.

Section 2.02. Other Closing Matters.

(a) If any Party discovers, within 90 days following the Closing Date, that
there were assets of the Seller Parties that constitute Transferred Assets in
accordance with the terms of this Agreement, but that were not so transferred,
the applicable Seller Parties shall promptly assign and transfer to the Buyer
all of their right, title and interest in and to such assets. For the avoidance
of doubt, the Parties acknowledge and agree that any such Transferred Assets
described in the preceding sentence shall be treated as having been acquired by
the Buyer at the Closing for applicable Tax purposes. If any Party discovers,
within 90 days following the Closing Date, that there were assets of the Seller
Parties that do not constitute Transferred Assets, but that were transferred at
or following the Closing to the Buyer or a Designated Buyer, the Buyer shall or
shall cause its Affiliates promptly to assign and transfer to the applicable
Seller Parties all of its or their right, title and interest in and to such
assets. Without limiting the foregoing, the Parties acknowledge that if any
Party (the “Receiving Party”) receives a payment from a third party that is due
to the other Party, the Receiving Party shall promptly pay it over to the other
Party.

(b) Subject to Article VII herein, Seller Parties acknowledge and agree that, at
the request of the Buyer, the applicable Seller Parties shall sell, convey,
assign, transfer and deliver certain of the applicable Transferred Assets (as
directed by the Buyer) to one or more Affiliates of the Buyer (each, a
“Designated Buyer”) at the Closing. Buyer hereby directs that the Transferred
Equity be sold, conveyed, assigned, transferred and delivered to Achilles
Technology Management Co I, Inc.

Section 2.03. Closing. The closing of the sale and purchase of the Transferred
Assets and the assumption of the Assumed Liabilities (the “Closing”) shall take
place at the offices of Dechert LLP, 1095 Avenue of the Americas, New York, New
York 10036 at 10:00 a.m. (New York time) on the Closing Date. The date on which
the Closing occurs is referred to in this Agreement as the “Closing Date”. For
all purposes under this Agreement and each other Transaction Agreement, (a) all
matters at the Closing will be considered to take place simultaneously and
(b) the Closing shall be deemed effective as of 12:01 a.m. (New York time) on
the Closing Date.

ARTICLE III

PURCHASE PRICE

Section 3.01. Purchase Price.

(a) The aggregate consideration to be paid by the Buyer to the Seller or the
Seller Designee, as applicable, at the Closing for the sale of the Transferred
Assets and the assumption of the Assumed Liabilities shall be an amount in cash
equal to $125,799,811.

(b) The aggregate consideration payable pursuant to this Section 3.01 is
referred to in this Agreement as the “Purchase Price”. The Purchase Price shall
be subject to any upward or downward Post-Closing Adjustment pursuant to
Section 3.06.

 

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Section 3.02. Certain Closing-Related Deliverables.

(a) At the Closing, the Seller shall deliver or cause to be delivered to the
Buyer the counterparts of the Seller Transaction Agreements, duly executed by
the applicable Seller Parties, including:

(i) a warrant assignment with respect to the Transferred Equity, duly executed
by the applicable Seller Parties;

(ii) a certificate from each Seller Party in compliance with the Treasury
Regulations promulgated under Section 1445 of the Code and in form and substance
reasonably satisfactory to the Buyer certifying that withholding is not required
under Section 1445 of the Code with respect to the transfer of such Transferred
Assets by such Seller Party; and

(iii) (x) an assignment or (y) a joint instruction and notice of loan
assignment, as applicable, with respect to each such Transferred Loan Agreement,
duly executed by the applicable Seller Party and the applicable Obligor.

(b) At the Closing, the Buyer shall deliver or cause to be delivered to the
Seller the counterparts of the Buyer Transaction Agreements, duly executed by
the Buyer or the applicable Designated Buyer.

Section 3.03. Closing Date Payment. At the Closing, the Buyer shall pay or shall
cause to be paid to the Seller, by wire transfer of immediately available funds
to an account designated by the Seller in writing, the amount set forth in
Section 3.01(a). Such amount paid by the Buyer to the Seller at the Closing is
referred to in this Agreement as the “Closing Date Payment”.

Section 3.04. Post-Closing Statement.

(a) Within 120 days after the Closing Date, the Buyer shall prepare and deliver
to the Seller a statement (the “Initial Settlement Statement”) setting forth the
Buyer’s good faith calculation of the actual Purchase Price, together with
reasonable supporting detail as to each of the calculations contained therein.
The Initial Settlement Statement shall be prepared on a basis consistent with
Schedule A.

(b) In connection with the Buyer’s preparation of the Initial Settlement
Statement, the Seller shall, upon reasonable advance notice and only during the
normal operating hours of the Seller, make available to the Buyer and its
Representatives all (i) relevant information reasonably requested by the Buyer
and (ii) individuals in the Seller’s and the Seller’s Affiliates’ employ
responsible for and knowledgeable about the information to be used in the
preparation of the Initial Settlement Statement to respond to the reasonable
inquiries of, or reasonable requests for information by, the Buyer or its
Representatives.

 

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(c) During the 30-day period immediately following the Seller’s receipt of the
Initial Settlement Statement (the “Review Period”), the Seller and its
Representatives shall be permitted to review the Buyer’s work papers used in the
preparation of the Initial Settlement Statement, and the Buyer shall, upon
reasonable advance notice and only during the normal operating hours of the
Buyer, make available all individuals in its and its Affiliates’ employ
responsible for and knowledgeable about the information used in, and the
preparation of the Initial Settlement Statement to respond to the reasonable
inquiries of, or reasonable requests for information by, the Seller or its
Representatives.

Section 3.05. Reconciliation of Post-Closing Statements.

(a) The Seller shall notify the Buyer in writing (the “Notice of Disagreement”)
before the expiration of the Review Period if the Seller does not agree with the
Initial Settlement Statement. The Notice of Disagreement shall set forth in
reasonable detail the basis for such dispute, the amounts involved in such
dispute and the Seller’s determination of the amounts that should be contained
in the Initial Settlement Statement. If the Seller does not deliver a Notice of
Disagreement prior to the expiration of the Review Period, then the Initial
Settlement Statement shall be conclusive and binding on the Parties and shall
constitute the Final Settlement Statement.

(b) During the 30-day period immediately following the delivery of a Notice of
Disagreement (the “Consultation Period”), the Seller and the Buyer shall seek in
good faith to resolve all differences that they may have with respect to the
matters specified in the Notice of Disagreement.

(c) If, at the end of the Consultation Period, the Seller and the Buyer have
been unable to resolve all differences that they may have with respect to the
matters specified in the Notice of Disagreement, the Seller and the Buyer shall
each have the right to submit their disputes to a mutually satisfactory and
nationally recognized accounting firm as shall be agreed upon by the Seller and
the Buyer, which shall resolve the Parties’ disputes based on rules and
procedures mutually satisfactory to the Parties; provided that such accounting
firm shall only address those items that the Parties have designated as being in
dispute and its decision for each disputed item must be within the range of
values assigned to such item in the Initial Settlement Statement and the Notice
of Disagreement.

(d) The statement of the Purchase Price that is conclusive and binding on the
Parties (the “Final Settlement Statement”) is (i) as set forth in the Initial
Settlement Statement, if no Notice of Disagreement is delivered to the Buyer
during the Review Period, (ii) as determined through agreement of the Parties
pursuant to Section 3.05(b), or (iii) as determined by the independent
accounting firm pursuant to Section 3.05(c).

Section 3.06. Post-Closing Adjustment. For purposes of this Agreement,
“Post-Closing Adjustment” means (a) the Purchase Price (as set forth on the
Final Settlement Statement) less (b) the Closing Date Payment. If the
Post-Closing Adjustment is a positive amount, then the Buyer shall pay in cash
to the Seller the amount of the Post-Closing Adjustment. If the Post-Closing
Adjustment is a negative amount, then the Seller shall pay in cash to the Buyer
the absolute value of the amount of the Post-Closing Adjustment. Any such
payment shall be made within three Business Days after the Final Settlement
Statement becomes final, together with simple interest thereon at a rate of 3%
per annum for each day from the Closing Date to the date payment is made in
full.

 

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ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF THE SELLER

The Seller hereby represents and warrants to the Buyer that, except as set forth
in the Disclosure Schedule:

Section 4.01. Incorporation and Authority of the Seller Parties; Enforceability.
Each Seller Party is a corporation or other entity duly incorporated or formed,
validly existing and, to the extent legally applicable, in good standing under
the Laws of its jurisdiction of incorporation or formation. Each Seller Party
has the requisite corporate or other entity power to execute, deliver and
perform its obligations under the Seller Transaction Agreements (including the
consummation of the Seller Transactions) to which it is a party. Each Seller
Party has the requisite corporate or other power to operate its business with
respect to the Transferred Assets and is duly qualified as a foreign corporation
or other entity to do business, and to the extent legally applicable, in good
standing, in each jurisdiction in which the character of its owned, operated or
leased properties or the nature of its activities makes such qualifications
material to the Transferred Assets, except where the failure to obtain such
qualification to do business would not materially impair or materially delay the
ability of any Seller Party to consummate the Seller Transactions or otherwise
perform their respective obligations under the Seller Transaction Agreements.
The execution, delivery and performance by each Seller Party of the Seller
Transaction Agreements to which it is a party have been duly authorized by all
requisite corporate or other entity action on the part of such Seller Party, and
no shareholder or other similar approval is required in connection with such
Seller Party’s execution, delivery and performance of the Seller Transaction
Agreements. This Agreement has been duly and validly executed and delivered by
the Seller, and upon execution and delivery thereof, the other Seller
Transaction Agreements will be duly and validly executed and delivered by the
Seller Parties party thereto, and (assuming due authorization, execution and
delivery thereof by the other parties hereto and thereto) this Agreement
constitutes, and upon execution and delivery thereof, the other Seller
Transaction Agreements will constitute, legal, valid and binding obligations of
the Seller Parties party thereto, enforceable against the Seller Parties party
thereto in accordance with their respective terms, subject to the Bankruptcy and
Equity Exception.

Section 4.02. No Conflict. Except, in the case of clause (b) below, for any such
conflicts, violations, breaches, defaults, rights or Liens that would not
materially impair or materially delay the ability of the Seller Parties to
consummate the Seller Transactions or otherwise perform their respective
obligations under the Seller Transaction Agreements, the execution, delivery and
performance by the Seller Parties of the Seller Transaction Agreements do not
and will not:

(a) conflict with or violate the certificate or articles of incorporation or
bylaws or similar organizational documents of any of the Seller Parties; or

(b) conflict with or violate any Law applicable to the Seller Parties.

 

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Section 4.03. Consents and Approvals. The execution, delivery and performance by
the Seller Parties of the Seller Transaction Agreements do not and will not
require any Consent, waiver or other action by, or any material filing with or
notification to (excluding any intellectual property security filings, Uniform
Commercial Code filings or similar filings with respect to any of the Collateral
or the perfection of the Collateral), any Government Authority by or with
respect to any Seller Party, except where the failure to obtain such Consent or
waiver, to take such action, or to make such filing or notification, would not
materially impair or materially delay the ability of any Seller Party to
consummate the Seller Transactions or otherwise perform their respective
obligations under the Seller Transaction Agreements.

Section 4.04. Absence of Litigation. There is no Action pending or, to the
knowledge of the Seller, threatened against a Seller Party in its capacity as a
lender under the Loan Agreements.

Section 4.05. Taxes. There are no Liens for Seller Taxes on any Transferred
Asset that would impact the Seller Parties’ security interest in such
Transferred Asset other than Liens for Taxes not yet due and payable.

Section 4.06. Brokers. No broker, finder or investment banker is entitled to any
fee or commission from the Seller or any of its Affiliates in connection with
any Transaction, except for such fees or commissions for which the Seller is
solely responsible and for which none of the Buyer or any of its Affiliates will
have any obligation or liability.

Section 4.07. Title. The applicable Seller Party has good, valid and marketable
title to, is the sole legal and beneficial owner of, and will deliver each
Transferred Asset, free and clear of all Liens, except for Permitted Liens.

Section 4.08. Loan Agreements.

(a) Except as set forth in a compliance certificate delivered to the Seller and
made available to the Buyer, the Seller has not received any written notice from
an Obligor of, or declared, an “Event of Default” under any of the Loan
Agreements.

(b) No Seller Party has received written notice of any alleged breach or default
by any Seller Party under any Loan Agreement.

(c) Except as otherwise made available to the Buyer, (i) no Seller Party has
waived any material rights under any of the Loan Agreements, and (ii) no Obligor
of any Loan Agreement has provided written notice pursuant to the terms of its
applicable Loan Agreement to any Seller Party stating that such Obligor intends
to prepay or refinance any indebtedness arising under such Loan Agreement.

(d) No Seller Party has sold any participation or other interest in any of the
loans arising under the Loan Agreements.

(e) The Seller has made available to the Buyer true and complete written copies
of all Loan Agreements and all amendments, side letters, modifications, waivers,
extensions, cancellations and releases to which the Seller (or the applicable
Seller Party) is a party, as of the Closing Date. All amendments, side letters,
modifications, waivers, extensions, cancellations and releases in respect of any
Loan Agreement to which the Seller is a party are in writing. Schedule A sets
forth a true and complete list of all the Loan Agreements of the applicable
Obligor thereunder.

 

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(f) To the knowledge of the Seller, each Loan Agreement is valid, binding and
enforceable by the Seller Party that is party thereto against the Obligor
thereunder in accordance with its terms, except as may be limited by the
Bankruptcy and Equity Exception.

Section 4.09. Transferred Equity. The Seller has made available to the Buyer the
copies in its possession of the securityholder agreements, warrant agreements or
similar agreements to which a Seller Party is a party with respect to the
Transferred Equity.

Section 4.10. Disclaimer of Warranties. Except as set forth in this Article IV,
none of the Seller Parties have made, or shall be deemed to have made, any other
representation or warranty, express or implied, at Law or in equity, in respect
of the Transferred Assets, including with respect the accuracy or completeness
of any (i) projections, predictions, forecasts, estimates, expenses or
expenditures, future cash flows (or any component thereof) or future financial
condition (or any component thereof) provided to the Buyer or (ii) information,
documents or materials regarding Transferred Assets, including any information
furnished or made available to the Buyer, its Affiliates or their respective
Representatives in any “data rooms,” “virtual data rooms,” management
presentations or in any other form in expectation of, or in connection with, the
Transactions (the “Evaluation Material”), or the appropriateness or suitability
of such information for the purposes of enabling the Buyer to evaluate the
consummation of the Transactions. Any such other representations or warranties
are hereby expressly disclaimed. Other than the indemnification obligations of
the Seller set forth in Article IX and with respect to intentional and knowing
fraud on behalf of the Seller, none of the Seller Parties will have or be
subject to any liability or indemnification obligation to the Buyer or any other
Person resulting from the distribution to the Buyer, its Affiliates or their
respective Representatives of, or the Buyer’s use of or reliance on, any
Evaluation Material in expectation of the Transactions.

ARTICLE V

REPRESENTATIONS AND WARRANTIES OF THE BUYER

The Buyer hereby represents and warrants to the Seller that:

Section 5.01. Incorporation and Authority of Buyer. The Buyer is a limited
liability company organized, validly existing and in good standing under the
Laws of the State of Delaware and has the requisite limited liability company
power to execute, deliver and perform its obligations under the Buyer
Transaction Agreements (including the consummation of the Buyer Transactions).
The execution, delivery and performance of the Buyer Transaction Agreements by
the Buyer have been duly authorized by all requisite limited liability company
action on the part of the Buyer, and no equityholder or other similar approval
is required in connection with the Buyer’s execution, delivery and performance
of the Buyer Transaction Agreements. This Agreement has been, and upon execution
and delivery thereof, the other Buyer Transaction Agreements will be, duly and
validly executed and delivered by the Buyer, and (assuming due authorization,
execution and delivery by the other parties hereto and thereto) this Agreement
constitutes, and upon execution and delivery thereof, the other Buyer
Transaction Agreements will constitute, legal, valid and binding obligations of
the Buyer enforceable against Buyer in accordance with their respective terms,
subject to the Bankruptcy and Equity Exception.

 

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Section 5.02. No Conflict. Except, in the case of clauses (b) and (c) below, for
any such conflicts, violations, breaches, defaults, rights or Liens as would not
materially impair or materially delay the ability of the Buyer to consummate the
Buyer Transactions or otherwise perform its obligations under the Buyer
Transaction Agreements, the execution, delivery and performance by the Buyer of
the Buyer Transaction Agreements do not and will not:

(a) conflict with or violate the certificate of formation or limited liability
company agreement of the Buyer;

(b) conflict with or violate any Law applicable to the Buyer; or

(c) result in any breach or violation of, or constitute a default under, or give
to any Person any right to terminate, amend, accelerate or cancel, or result in
the creation of any Lien on any assets or properties of the Buyer pursuant to,
any note, bond, mortgage, indenture, contract, agreement, lease, license,
permit, franchise or other material instrument to which the Buyer or any of its
subsidiaries is a party or by which any of such assets or properties is bound.

Section 5.03. Consents and Approvals. The execution, delivery and performance by
the Buyer of the Buyer Transaction Agreements do not and will not require any
Consent, waiver or other action by, or any filing with or notification to, any
Government Authority by or with respect to the Buyer, except where the failure
to obtain such Consent or waiver, to take such action, or to make such filing or
notification, would not materially impair or materially delay the ability of the
Buyer to consummate the Buyer Transactions or otherwise perform its obligations
under the Buyer Transaction Agreements.

Section 5.04. Securities Matters. The Buyer is an “accredited investor” (as such
term is defined in Rule 501 of Regulation D under the Securities Act). The
Transferred Equity is being acquired by the Buyer for its own account, and not
with a view to, or for the offer or sale in connection with, any public
distribution or sale of the Transferred Equity or any interest in it.

Section 5.05. Brokers. No broker, finder or investment banker is entitled to any
fee or commission from the Buyer or any of the Buyer’s Affiliates in connection
with any Transaction, except for such fees or commissions for which the Buyer is
solely responsible and for which none of the Seller or any of its Affiliates
will have any Liability.

Section 5.06. Availability of Funds. The Buyer has cash available or, through
binding arrangements with one or more third parties, has existing borrowing
facilities or firm equity commitments which, together with its available cash,
are sufficient to enable it to consummate the transactions contemplated by this
Agreement.

Section 5.07. Independent Investigation. The Buyer has such knowledge and
experience in financial and business matters that it is capable of evaluating
the merits and risks of its participation in the Transactions and is able to
bear the economic risk associated with the purchase of the Transferred Assets.
The Buyer has conducted its own independent review and analysis of, and based
thereon has formed an independent judgment concerning, the Transferred Assets.
In entering into this Agreement, the Buyer has relied solely upon its own review
and analysis and the specific representations and warranties of the Seller
expressly set forth in Article IV and not on any representations, warranties,
statements or omissions by any Person other than

 

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the Seller, or by the Seller other than those specific representations and
warranties expressly set forth in Article IV. The Buyer acknowledges that,
except for the representations and warranties expressly set forth in Article IV,
none of the Seller Parties have made, or shall be deemed to have made, and the
Buyer has not relied on, is not relying on and hereby disclaims, any other
representation or warranty, express or implied, at Law or in equity, in respect
of the Transferred Assets, including with respect to the accuracy or
completeness of any projections, predictions, forecasts, estimates, expenses or
expenditures, future cash flows (or any component thereof) or future financial
condition (or component thereof), provided to the Buyer, the Evaluation Material
or otherwise, or the appropriateness or suitability of such information for the
purposes of enabling the Buyer to evaluate the consummation of the Transactions.
Any such other representations or warranties are hereby expressly disclaimed.
Other than the indemnification obligations of the Seller Parties set forth in
Article IX and with respect to intentional and knowing fraud on behalf of the
Seller, none of the Seller Parties, their respective Affiliates nor any of their
respective Representatives will have or be subject to any liability or
indemnification obligation to the Buyer or any other Person resulting from the
distribution to the Buyer, its Affiliates or their respective Representatives
of, or the Buyer’s use of or reliance on, any Evaluation Material in expectation
of the Transactions. The Buyer confirms that the Seller has made available to
the Buyer and the Buyer’s Representatives the opportunity to ask questions of
the personnel of the Seller Parties.

ARTICLE VI

ADDITIONAL AGREEMENTS

Section 6.01. Non-Disclosure. Effective upon the Closing, the Non-Disclosure
Agreement dated August 15, 2017, by and between the Buyer and the Seller, as
amended, shall terminate in accordance with Section 9 thereof.

Section 6.02. Non-Solicitation.

(a) During the period beginning on the Closing Date and ending on the one-year
anniversary thereof, the Seller shall not directly engage, solicit, or induce
any transaction with respect to any Obligor (or any of its controlled
subsidiaries) under any of the Transferred Loan Agreements or any issuer (or any
of its controlled subsidiaries) under any of the Transferred Equity, in each
case, that could reasonably be expected to result in any termination, repayment
or refinancing of any obligations under such instruments, obligations or
securities or the issuance of any new alternative or additional financing or
investment, provided that (i) in the ordinary course of its business, the Seller
may assist a third party in connection with financing for transactions involving
(A) any Obligor (or any of its respective controlled affiliates) or (B) any
issuer of the Transferred Equity (or any of its respective controlled
subsidiaries), in each case, solely to the extent such transactions involve a
material acquisition by, or a change of control of, such Obligor or issuer, and
(ii) in the event that the Buyer becomes aware of a breach or potential breach
by the Seller of this provision, the Buyer shall provide the Seller with written
notice (including a reasonable description) of such breach and the Seller shall
have 15 Business Days to cure such breach (to the extent such breach is
curable).

 

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(b) The Seller recognizes that the time and scope limitations set forth in
Section 6.02(a) are reasonable and are properly required for the protection of
the Buyer’s and its Affiliates’ legitimate interests in client relationships and
goodwill, and in the event that any such time or scope limitation is deemed to
be unreasonable by a court of competent jurisdiction, the Buyer and the Seller
agree to submit to the reduction of any or all of said time or scope limitations
to such a period or scope as said court shall deem reasonable under the
circumstances, and in its reduced form, such provision shall then be enforceable
and shall be enforced.

(c) For the avoidance of doubt, this Section 6.02 may be enforced as provided in
Sections 10.12 through 10.15.

ARTICLE VII

FURTHER ASSURANCES

Section 7.01. Further Assurances. Subject in all respects to the limitations of
Sections 7.02 and 7.03 below (including with respect to the Cutoff Date), from
time to time following the Closing, the Parties shall, and shall cause their
respective Affiliates to, use commercially reasonable efforts to execute,
acknowledge and deliver all reasonable further conveyances, notices,
assumptions, releases and other instruments, and shall take such reasonable
actions, as may be necessary or appropriate to make effective the Transactions
and as may be reasonably requested by the other Party.

Section 7.02. Collateral Actions and Costs and Expenses.

(a) Other than as expressly set forth below in this Section 7.02 or in
Section 7.03, the Buyer and the Seller expressly acknowledge and agree that
Buyer shall take all actions necessary to (x) prepare or draft, as applicable,
and (y) file or cause to be filed or deliver, as applicable, such Uniform
Commercial Code financing statements, intellectual property security agreements,
mortgages, share charges, stock pledge agreements, agency transfer agreements,
deposit account control agreements and any other documents, assignments and/or
amendments as may reasonably be necessary or appropriate to make effective the
Transactions and to allow for Buyer to obtain the full benefits of the
Collateral and the Transferred Credit Documents.

(b) The Buyer and the Seller expressly acknowledge and agree that the Buyer
shall be responsible for the payment or reimbursement of all reasonable and
documented out-of-pocket fees, costs and expenses (including attorneys’ fees)
incurred by the Seller or any other Seller Indemnified Party in connection with
its obligations under this Article VII, including the transfer of the
(i) Collateral, (ii) the Transferred Credit Documents and (iii) with respect to
an Agented Transaction, agency to the Buyer or its Affiliates (including, but
not limited to, the Other Transfer Actions and any other actions referenced in
Section 7.02(a)); provided, however, that the Buyer shall not be responsible for
the payment or reimbursement of any such fees, costs and expenses (including
attorneys’ fee) in excess of $35,000 in the aggregate without the prior written
consent of the Buyer; it being understood that if the Buyer does not approve
such payment or reimbursement, then the Seller shall not be required to perform
such obligations. The Seller and the Buyer hereby acknowledge and agree that the
Seller and the other Seller Indemnified Parties will continue to benefit from
any indemnification, exculpation, expense reimbursement or similar provisions in
the Transferred Credit Documents.

 

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Section 7.03. Non-Fiduciary Bailee.

(a) To the extent any of the filings or other actions and execution of such
agreements, instruments and other documents, in each case, in respect of the
Collateral, as specified on Schedule B to this Agreement (collectively, the
“Other Transfer Actions”), have not occurred as of the Closing, the Seller shall
use its commercially reasonable efforts to cooperate with the Buyer in order to
(i) complete the Other Transfer Actions and (ii) with respect to any Agented
Transactions, to cause the Buyer or its Affiliates to become the administrative
agent and collateral agent under the related Transferred Credit Documents, in
each case, until the earlier of (x) such time as all the Other Transfer Actions
have occurred (as mutually determined by the Buyer and the Seller) and (y) 180
days following the Closing Date (the earlier of such dates, the “Cutoff Date”).

(b) In furtherance of the foregoing, until the occurrence of the Cutoff Date,
the Buyer hereby appoints the Seller, and the Seller hereby accepts such
appointment, as the gratuitous, non-fiduciary bailee of the Buyer in respect of
the Transferred Credit Documents (including, without limitation, any insurance
certificate and/or endorsement, landlord waiver or collateral access agreement,
account control agreement or other contractual right of the Seller) for the
benefit of the lenders and the other secured parties under the related
Transferred Credit Documents solely for purposes of maintaining any existing
perfection of the Lien on the Collateral granted under the applicable
Transferred Credit Documents (including if the Seller has any Collateral in its
possession or control, then, the Seller will possess or control such Collateral
as gratuitous, non-fiduciary bailee for perfection for the benefit of the Buyer
as secured party, so as to satisfy the requirements of Sections 8-106(d)(3),
8-301(a)(2), and 9-313(c) of the Uniform Commercial Code until such time as such
possession or control has been transferred to the Buyer (or if earlier, the
Cutoff Date) and to, vote on such matters and to take such other actions as
reasonably requested by the Buyer (in each case, subject to the last sentence of
clause (b) of this Section 7.03). Neither the Seller nor any Seller Indemnified
Party will have any obligation to any lender or any other secured party under
the applicable Transferred Credit Documents, the Buyer or any other Person to
ensure that any Collateral is genuine, owned by any of the Loan Parties, or
perfected as of the Closing Date or any time thereafter, or to preserve rights
or benefits of any Person except as expressly set forth in this Section 7.03(b).
In this Section 7.03(b), “control” has the meaning given that term in Sections
8-106 and 9-314 of the Uniform Commercial Code as in effect of the State of New
York (or, if different, any applicable provisions under the applicable Laws of
another jurisdiction). The duties or responsibilities of the Seller under this
Section 7.03 will include, until the Cutoff Date, being named as the secured
party (of record or otherwise) and additional insured/loss payee on insurance
certificates and endorsements, possessing or controlling the applicable
Collateral, in each case, as gratuitous, non-fiduciary bailee for perfection in
accordance with this Section 7.03. The Buyer (on behalf of itself and its
Affiliates) hereby waives and releases the Seller and the other Seller
Indemnified Parties from all claims and liabilities arising out of the Seller’s
role under this Section 7.03 as gratuitous, non-fiduciary bailee with respect to
any Collateral and for any action taken by the Seller or any other Seller
Indemnified Party at the direction of the Buyer or its Affiliates with respect
to the Collateral or the Transferred Credit Documents other than claims or
liabilities resulting directly from the gross negligence or willful misconduct
of the Seller or any other Seller Indemnified Party (as determined by a court of
competent jurisdiction in a final non-appealable judgment or order). Neither the
Seller nor any other Seller Indemnified Party makes any representation or
warranty as to whether the provisions of this Article VII are sufficient to
perfect or continue the perfection of any security interest in any Collateral,
including any such Collateral in which the Seller has possession or control.
Upon the

 

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occurrence of the Cutoff Date, the gratuitous, non-fiduciary bailee relationship
pertaining to the Collateral shall immediately and automatically terminate
without any further action by any Party or any other Person. The Seller, in its
capacity as gratuitous, non-fiduciary bailee of the Buyer as described in this
Section 7.03, will act at the written direction of (and solely at the written
direction of) the Buyer (unless such action (or any omission to take any action)
is, in the reasonable opinion of the Seller or the Seller’s counsel, contrary
to, and in violation of, any Transferred Credit Document or any applicable Law
or would reasonably be expected to subject the Seller or any other Seller
Indemnified Party to any liability (not adequately covered in the reasonable
opinion of the Seller by any indemnity provided by the Buyer to the Seller
hereunder), including any out-of-pocket fees, costs or expenses) and furthermore
the Seller and the other Seller Indemnified Parties shall also benefit from all
of the provisions of the Transferred Credit Documents and applicable privileges
applicable to bailees or sub-agents of the Buyer with respect to any actions
taken or omitted to be taken in its capacity as bailee or sub-agent of the Buyer
or otherwise at the direction of the Buyer.

ARTICLE VIII

TAX MATTERS

Section 8.01. Transfer Taxes. Notwithstanding anything to the contrary in this
Agreement, any Transfer Taxes imposed or arising with respect to the
Transactions shall be borne equally by the Seller and the Buyer. The Party
required by Law to file a Tax Return with respect to such Transfer Taxes shall
timely prepare, with the other Party’s cooperation, and file such Tax Return.
Each Party agrees to timely execute and deliver (or to cause to be timely
executed and delivered) such certificates or forms as may be necessary or
appropriate and otherwise to cooperate to establish any available exemption from
(or otherwise reduce) such Transfer Taxes.

Section 8.02. Cooperation. The Parties shall reasonably cooperate with each
other in connection with the preparation of Tax Returns related to any issuer of
any Transferred Equity (including any such issuer’s subsidiaries) and shall
preserve all information, returns, books, records and documents relating to any
liabilities for Taxes with respect to any taxable period (or portion thereof)
ending on or before the Closing Date until the later of the expiration of all
applicable statutes of limitation and extensions thereof or a final
determination with respect to Taxes for such period, and shall not destroy or
otherwise dispose of any such record without first providing the other Party a
reasonable opportunity to review and copy the same.

ARTICLE IX

INDEMNIFICATION

Section 9.01. Survival.

(a) The representations and warranties of the Seller and the Buyer contained in
or made in this Agreement or any other Transaction Agreement shall survive in
full force and effect until the one-year anniversary of the Closing Date;
provided, however, that the Seller Fundamental Representations shall survive
until the expiration of the applicable statute of limitations; provided further,
that any claim arising under this Article IX that is pending at the expiration
of the survival period for the applicable representation and warranty shall
survive until such claim is resolved by the Parties or by a court of competent
jurisdiction and any amounts payable hereunder are finally determined and paid.

 

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(b) Any covenant and agreement to be performed by the Parties after the Closing
shall survive the Closing in accordance with its terms, or if no term is
specified, until the expiration of the applicable statute of limitations.

Section 9.02. Indemnification by the Seller. From and after the Closing Date,
the Seller shall indemnify and hold harmless the Buyer and its Affiliates, and
each of their respective directors, officers, stockholders, agents, employees
and other Representatives (collectively, the “Buyer Indemnified Parties”)
against, and reimburse any Buyer Indemnified Party for, Losses that such Buyer
Indemnified Party may suffer or incur, or become subject to, as a result of:

(a) any breach of, or inaccuracy in, any representations or warranties made by
the Seller in this Agreement or any other Transaction Agreement;

(b) any breach or failure by the Seller to perform or comply with any of its
covenants or agreements contained in this Agreement or any other Transaction
Agreement; or

(c) any Excluded Liability.

Section 9.03. Indemnification by the Buyer. From and after the Closing Date, the
Buyer shall indemnify and hold harmless the Seller, the Seller Designees, and
their respective Affiliates, and each of their respective directors, officers,
stockholders, agents, employees and other Representatives (collectively, the
“Seller Indemnified Parties”) against, and reimburse any Seller Indemnified
Party for, Losses that such Seller Indemnified Party may suffer or incur, or
become subject to, as a result of:

(a) any breach of, or inaccuracy in, any representations or warranties made by
the Buyer in this Agreement or any other Transaction Agreement;

(b) any breach or failure by the Buyer to perform or comply with any of its
covenants or agreements contained in this Agreement or any other Transaction
Agreement; or

(c) any Assumed Liability.

Section 9.04. Notification of Claims.

(a) Except as otherwise provided in this Agreement, a Buyer Indemnified Party or
Seller Indemnified Party (each, an “Indemnified Party”) shall promptly notify
the indemnifying party (the “Indemnifying Party”) in writing of any pending
claim by a third party that would give rise to a right of indemnification under
this Agreement (a “Third Party Claim”); provided, however, that the failure to
provide such notice shall not release the Indemnifying Party from any of its
obligations under this Article IX except to the extent the Indemnifying Party is
prejudiced by such failure.

 

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(b) Upon receipt of a notice of a claim for indemnity from an Indemnified Party
pursuant to Section 9.04(a), the Indemnifying Party shall have the right to
assume the defense and control of any Third Party Claim and, in the event that
the Indemnifying Party shall assume the defense of such claim, it shall allow
the Indemnified Party a reasonable opportunity to participate in the defense of
such Third Party Claim with its own counsel and at its own expense; provided,
however, that the Indemnifying Party shall not be entitled to assume the defense
of a Third Party Claim that seeks the imposition of criminal penalties or other
sanctions that would be reasonably expected to materially and adversely affect
any of the Transferred Assets or the Assumed Liabilities. The Person that shall
control the defense of any such Third Party Claim (the “Controlling Party”)
shall select counsel of recognized standing and competence after consultation
with the other Party and shall take all steps reasonably necessary in the
defense or settlement of such Third Party Claim.

(c) The Seller or the Buyer, as the case may be, shall, and shall cause each of
its Affiliates and Representatives to, cooperate fully with the Controlling
Party in the defense of any Third Party Claim. The Indemnifying Party shall be
authorized to consent to a settlement of, or the entry of any judgment arising
from, any Third Party Claim, without the consent of any Indemnified Party;
provided that the (x) Indemnifying Party shall (i) pay all amounts arising out
of such settlement or judgment and (ii) obtain, as a condition of any
settlement, a release of any Indemnified Party potentially affected, and
(y) settlement does not include any injunctive or equitable relief or admission
of Indemnified Party wrongdoing.

Section 9.05. Exclusive Remedies. Except as otherwise expressly set forth in
this Agreement, including Section 3.05, and except for any claims arising out of
or relating to the intentional and knowing fraud on the part of any Party, any
claim for injunctive relief or other equitable relief, including with respect to
enforcing its rights under Section 6.02, following the Closing, the
indemnification provisions of this Article IX shall be the sole and exclusive
remedies of any Seller Indemnified Party and any Buyer Indemnified Party,
respectively, for any Losses.

Section 9.06. Limitations. In the event of any claim for indemnification under
Sections 9.02 and 9.03, the aggregate liability of either Party shall in no
event exceed the purchase price of the relevant Transferred Asset that gave
raise to such claim. The maximum aggregate liability of either Party for any
Losses under this Article IX (other than with respect to Losses arising out of
or relating to an Assumed Liability or an Excluded Liability) shall in no event
exceed the Purchase Price.

Section 9.07. Additional Indemnification Provisions. With respect to each
indemnification obligation contained in this Agreement (i) each such obligation
shall be reduced by any Tax benefit actually realized by the Indemnified Party;
(ii) each such obligation shall be increased by any Tax cost actually incurred
by the Indemnified Party; and (iii) all Losses shall be net of any amounts that
have been actually recovered by the Indemnified Party pursuant to any other
indemnification or insurance (net of any costs incurred in connection with such
recovery).

Section 9.08. Effect of Investigation. Any Indemnified Party’s right to
indemnification or other remedy shall not be affected or deemed waived by reason
of any investigation made by or on behalf of the Indemnified Party or by reason
of the fact that the Indemnified Party or any of its Representatives knew or
should have known at any time that any representation or warranty is, was or
might be breached or inaccurate.

 

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Section 9.09. Certain Indemnity Matters. Notwithstanding anything to the
contrary contained in this Agreement, no Indemnified Party shall be entitled to
indemnification for (i) duplicative Losses, (ii) except to the extent relating
to a Third Party Claim, any punitive or consequential damages relating to the
breach or alleged breach of this Agreement; or (iii) any Losses (or portion
thereof) to the extent such Losses (or portion thereof) were included as a
liability in the calculation of the Closing Date Payment or otherwise reflected
in the adjustment to the Purchase Price pursuant to Article III.

ARTICLE X

MISCELLANEOUS

Section 10.01. Rules of Construction. The following rules of construction shall
govern the interpretation of this Agreement:

(a) references to “applicable” Law or Laws with respect to a particular Person,
thing or matter means only such Law or Laws as to which the Government Authority
that enacted or promulgated such Law or Laws has jurisdiction over such Person,
thing or matter as determined under the Laws of the State of New York as
required to be applied thereunder by a court sitting in the State of New York;
references to any statute, rule, regulation or form (including in the definition
thereof) shall be deemed to include references to such statute, rule, regulation
or form as amended, modified, supplemented or replaced from time to time (and,
in the case of any statute, include any rules and regulations promulgated under
such statute), and all references to any section of any statute, rule,
regulation or form include any successor to such section;

(b) when calculating the period of time before which, within which or following
which any act is to be done or step taken pursuant to this Agreement, the date
that is referenced in beginning the calculation of such period will be excluded
(for example, if an action is to be taken within two days after a triggering
event and such event occurs on a Tuesday, then the action must be taken by
Thursday); and if the last day of such period is a non-Business Day, the period
in question will end on the next succeeding Business Day;

(c) whenever the context requires, words in the singular shall be held to
include the plural and vice versa, and words of one gender shall be held to
include the other gender as the context requires;

(d) (i) the provision of the table of contents, the division into Articles,
Sections and other subdivisions and the insertion of headings are for
convenience of reference only and shall not affect or be utilized in construing
or interpreting this Agreement; and (ii) references to the terms “Article”,
“Section”, “subsection”, “subclause”, “clause”, “Schedule” and “Exhibit” are
references to the Articles, Sections, subsections, subclauses, clauses,
Schedules and Exhibits to this Agreement unless otherwise specified;

(e) (i) the terms “hereof”, “herein”, “hereby”, “hereto” and derivative or
similar words refer to this entire Agreement, including the Schedules and
Exhibits hereto; (ii) the terms “include”, “includes”, “including” and words of
similar import when used in this Agreement mean “including, without limitation”
unless otherwise specified; (iii) the term “any” means “any and all”; and
(iv) the term “or” shall not be exclusive and shall mean “and/or”;

 

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(f) (i) references to “days” mean calendar days unless Business Days are
expressly specified; (ii) references to “written” or “in writing” include in
electronic form; and (iii) references to “$” mean U.S. dollars;

(g) references to any Person includes such Person’s successors and permitted
assigns; and

(h) each Party has participated in the negotiation and drafting of this
Agreement and if an ambiguity or question of interpretation should arise, this
Agreement shall be construed as if drafted jointly by the Parties and no
presumption or burden of proof shall arise favoring or burdening either Party by
virtue of the authorship of any provision in this Agreement; the language used
herein will be deemed to be the language chosen by the Parties to express their
mutual intent, and no rule of strict construction will be applied against either
Party.

Section 10.02. Expenses. Except as otherwise specified in the Transaction
Agreements, each Party will pay its own costs and expenses, including legal,
consulting, financial advisor and accounting fees and expenses, incurred in
connection with the Transactions, irrespective of when incurred.

Section 10.03. Notices. All notices and other communications under or by reason
of the Transaction Agreements shall be in writing and shall be deemed to have
been duly given or made (a) when personally delivered, (b) when delivered by
e-mail transmission with receipt confirmed or (c) one Business Day after deposit
with overnight courier service, in each case as indicated below (or such other
address, e-mail address or attention party as the recipient party has specified
by prior notice given to the sending party in accordance with this
Section 10.03):

If to the Seller, to:

Ares Capital Corporation

245 Park Avenue, 44th Floor

New York, New York 10167

Attention:     General Counsel

E-mail:         arccgeneralcounsel@aresmgmt.com

With a copy (which will not constitute notice) to:

Morgan, Lewis & Bockius LLP

101 Park Avenue, New York, NY 10178

Attention:      Alec Dawson

                       Sheryl Orr

E-mail:          alec.dawson@morganlewis.com

                       sheryl.orr@morganlewis.com

If to the Buyer, to:

Bearcub Acquisitions LLC

c/o Hercules Capital, Inc.

400 Hamilton Avenue

Suite 310

Palo Alto, California 94301

Attention:     Melanie Grace

E-mail:         mgrace@htgc.com

 

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with a copy (which will not constitute notice) to:

Dechert LLP

1095 Avenue of the Americas

New York, New York 10036

Attention:     Jay R. Alicandri

                      Martin Nussbaum

                      Ian A. Hartman

E-mail:         jay.alicandri@dechert.com

                      martin.nussbaum@dechert.com

                      ian.hartman@dechert.com

Section 10.04. Public Announcements. Unless, in the Buyer’s or the Seller’s good
faith judgment, required by Law or the rules or regulations of the New York
Stock Exchange or NASDAQ, neither the Buyer nor the Seller, nor any of their
respective Affiliates, agents or representatives will make any press release or
public announcement concerning, or otherwise disclose to any third party (other
than such party’s advisors, representatives and agents on a need-to-know and
confidential basis), the terms or existence of this Agreement or the
Transactions, except with the prior written consent of the other Party.
Notwithstanding the foregoing, the Parties recognize that each of them or their
respective Affiliates has securities that are traded in the public markets,
including that certain of the Buyer’s Affiliates issue securities from time to
time, and therefore disclosure of this Agreement or the Transactions may be
necessary in that context; provided that in such event, the disclosing party
shall give the other party an opportunity to review and comment on such
disclosure documents and the disclosing party will consider and incorporate all
such comments in good faith.

Section 10.05. Severability. If any term or provision of this Agreement is held
invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of all other terms and provisions of this Agreement will not in
any way be affected or impaired. If the final judgment of a court of competent
jurisdiction or other Government Authority declares that any term or provision
hereof is invalid, illegal or unenforceable, the court making such determination
will have the power to replace any invalid, illegal or unenforceable term or
provision with a term or provision that is valid, legal and enforceable and that
comes closest to expressing the intention of the Parties.

Section 10.06. Assignment. This Agreement will be binding upon and inure to the
benefit of and be enforceable by the respective successors and permitted assigns
of the Parties. Neither Party may assign (whether by operation of Law or
otherwise) this Agreement or any rights, interests or obligations provided by
this Agreement without the prior written consent of the other Party; provided,
however, that the Buyer may assign (whether by operation of Law or otherwise)
this Agreement and any or all rights and obligations under this Agreement to any
of its Affiliates; provided further, that either Party may assign this Agreement
to any Person that succeeds to all or substantially all of the business or
assets of such Party by purchase, merger or consolidation. Any attempted
assignment in violation of this Section 10.06 shall be void ab initio.

 

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Section 10.07. No Third-Party Beneficiaries. Except as otherwise set forth in
this Agreement (including Article IX), this Agreement and the other Transaction
Agreements are for the sole benefit of the Parties and their respective
successors and permitted assigns, and, except as expressly set forth in the
applicable Transaction Agreement, nothing in the Transaction Agreements shall
create or be deemed to create any third-party beneficiary rights in any Person
not a party to the Transaction Agreements, including any Affiliates of any
Party.

Section 10.08. Entire Agreement. This Agreement and the other Transaction
Agreements (and all exhibits and schedules hereto and thereto) collectively
constitute and contain the entire agreement and understanding of the Parties
with respect to the subject matter hereof and thereof and supersede all prior
negotiations, correspondence, understandings and agreements, whether written or
oral, among the Parties respecting the subject matter hereof and thereof.

Section 10.09. Amendments. The Transaction Agreements (including all exhibits
and schedules thereto) may be amended, restated supplemented or otherwise
modified, only by written agreement making specific reference to the applicable
Transaction Agreement to be amended, restated, supplemented or otherwise
modified, in each case duly executed by each party to such Transaction
Agreement.

Section 10.10. Waiver. No failure on the part of either Party to exercise, and
no delay in exercising, any right, power or remedy under any Transaction
Agreement shall operate as a waiver thereof, nor shall any single or partial
exercise of such right, power or remedy by such Party preclude any other or
further exercise thereof or the exercise of any other right, power or remedy.

Section 10.11. Counterparts. Each Transaction Agreement may be executed in
counterparts, each of which shall be deemed an original, but all of which when
taken together shall constitute one and the same instrument. Facsimiles, e-mail
transmission of .pdf signatures or other electronic copies of signatures shall
be deemed to be originals.

Section 10.12. Governing Law. The Transaction Agreements, and any Action that
may be based upon, arise out of or relate or be incidental to any Transaction,
any Transaction Agreement, the negotiation, execution, performance or
consummation thereof or the inducement of any Party to enter therein, whether
for breach of contract, tortious conduct or otherwise, and whether now existing
or hereafter arising (each, a “Transaction Dispute”), will be governed by and
construed and enforced in accordance with the Laws of the State of New York,
without giving effect to any Law that would cause the Laws of any jurisdiction
other than the State of New York to be applied.

Section 10.13. Dispute Resolution; Consent to Jurisdiction.

(a) Any Transaction Dispute will exclusively be brought and resolved in the U.S.
District Court for the Southern District of New York (where federal jurisdiction
exists) or the Commercial Division of the Courts of the State of New York
sitting in the County of New York (where federal jurisdiction does not exist),
and the appellate courts having jurisdiction of appeals in such courts. In that
context, and without limiting the generality of the foregoing, each Party
irrevocably and unconditionally:

(i) submits for itself and its property to the exclusive jurisdiction of such
courts with respect to any Transaction Dispute and for recognition and
enforcement of any judgment in respect thereof, and agrees that all claims in
respect of any Transaction Dispute shall be exclusively heard and determined in
such courts;

 

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(ii) agrees that venue would be proper in such courts, and waives any objection
that it may now or hereafter have that any such court is an improper or
inconvenient forum for the resolution of any Transaction Dispute; and

(iii) agrees that the mailing by certified or registered mail, return receipt
requested, to the Persons listed in Section 10.03 of any process required by any
such court, will be effective service of process; provided, however, that
nothing herein will be deemed to prevent a Party from making service of process
by any means authorized by the Laws of the State of New York.

(b) The foregoing consent to jurisdiction will not constitute submission to
jurisdiction or general consent to service of process in the State of New York
for any purpose except with respect to any Transaction Dispute.

(c) Nothing in this Section 10.13 is intended to supersede the dispute
procedures set forth in Section 3.04 or Section 3.05 with respect to the Initial
Settlement Statement and the Final Settlement Statement or preclude the ability
of any Party to seek specific performance pursuant to Section 10.15 in a court
of competent jurisdiction.

Section 10.14. Waiver of Jury Trial. To the maximum extent permitted by Law,
each Party irrevocably and unconditionally waives any right to trial by jury in
any forum in respect of any Transaction Dispute and covenants that neither it
nor any of its Affiliates or Representatives will assert (whether as plaintiff,
defendant or otherwise) any right to such trial by jury.

Section 10.15. Specific Performance. Each Party agrees that irreparable damage
would occur and the Parties would not have an adequate remedy at Law if any
provision of this Agreement is not performed in accordance with its specific
terms or is otherwise breached. Accordingly, each Party agrees that the other
Party will be entitled to seek injunctive relief from time to time to prevent
breaches of the provisions of this Agreement and seek to enforce specifically
the terms and provisions of this Agreement without the requirement of posting
any bond or other indemnity, in addition to any other remedy to which it may be
entitled, at Law or in equity, and each Party agrees not to raise any objections
to the availability of the equitable remedy of specific performance to prevent
or restrain breaches of this Agreement, and to specifically enforce the terms of
this Agreement to prevent breaches or threatened breaches of, or to enforce
compliance with, the covenants and obligations of such Party under this
Agreement. Each Party expressly disclaims that it is owed any duties not
expressly set forth in this Agreement, and waives and releases all tort claims
and causes of action that may be based upon, arise out of or relate to this
Agreement, or the negotiation, execution or performance of this Agreement.

 

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Section 10.16. Disclosure Schedule. Inclusion of information in the Disclosure
Schedule will not be construed as an admission that such information is material
to the Transferred Assets or the Assumed Liabilities. The Disclosure Schedule
has been arranged for purposes of convenience in separately titled Sections
corresponding to the Sections of this Agreement, however, each Section of the
Disclosure Schedule shall be deemed to incorporate by reference all information
disclosed in any other Section of the Disclosure Schedule to the extent it is
reasonably apparent on its face that the disclosure of such matter is applicable
to such Section of the Disclosure Schedule.

[Remainder of page intentionally left blank.]

 

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IN WITNESS WHEREOF, the Seller and the Buyer have caused this Agreement to be
executed on the date first written above by their respective duly authorized
officers.

 

SELLER: ARES CAPITAL CORPORATION By:  

/s/ Ian Fitzgerald

 

Name: Ian Fitzgerald

Title:   Authorized Signatory

BUYER: BEARCUB ACQUISITIONS LLC By:  

/s/ Melanie Grace

 

Name: Melanie Grace

Title:   General Counsel

Signature Page to Asset Purchase Agreement

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EXHIBIT A

DEFINITIONS

“Action” means any action, suit, arbitration, proceeding or investigation by or
before any Government Authority.

“Affiliate” means, with respect to any specified Person, any other Person that,
at the time of determination, directly or indirectly through one or more
intermediaries, controls, is controlled by or is under common control with such
specified Person; provided, however, that for the purposes of this Agreement no
Seller Party shall be deemed an Affiliate of Buyer.

“Agented Transaction” means any lending arrangement with an Obligor and
constituting a Transferred Asset pursuant to which the Seller or one of its
Affiliates was appointed as administrative agent or collateral agent prior to
the Closing Date with respect to the related Collateral pursuant to the
applicable Transferred Credit Documents.

“Agreement” means this Asset Purchase Agreement, dated as of the Closing Date,
by and between the Seller and the Buyer, including the Disclosure Schedule, this
Exhibit A and the Schedules, and all amendments to such agreement made in
accordance with Section 10.09.

“Bankruptcy and Equity Exception” means the effect on enforceability of (a) any
applicable Law relating to bankruptcy, reorganization, insolvency, moratorium,
fraudulent conveyance or preferential transfers, or similar Law relating to or
affecting creditors’ rights generally and (b) general principles of equity
(regardless of whether enforceability is considered in a proceeding in equity or
at law).

“Business Day” means any day that is not a Saturday, Sunday or other day on
which commercial banks in the City of New York, New York are required or
authorized by Law to be closed.

“Buyer Transaction Agreements” means this Agreement and each other Transaction
Agreement to which the Buyer is named as a party on the signature pages thereto.

“Buyer Transactions” means the transactions contemplated by the Buyer
Transaction Agreements.

“Code” means the Internal Revenue Code of 1986, as amended.

“Consent” means any consent, approval or authorization.

“Collateral” means any property and interests in property of any Loan Party in
or upon which a Lien is granted pursuant to any of the Transferred Credit
Documents in favor of or for the benefit of any agent, lender or other secured
party under any such Transferred Credit Document.

“Disclosure Schedule” means the Disclosure Schedule dated as of the Closing Date
delivered by the Seller to the Buyer.

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“Excluded Taxes” means all liabilities of the Seller or any of its Affiliates
and with respect to the Transferred Assets and Assumed Liabilities in respect of
any Tax for any taxable periods (or portion thereof) ending on or before the
Closing Date, including any Taxes arising out of, relating to or in respect of,
or as a result of owning, the Transferred Assets for such periods.

“Fees” means payments owed to the Seller Parties with respect to the Loan
Agreements from unused line fees, fees for serving as Loan Agreement Agent,
letter of credit fees, management fees, success fees, end of term fees and other
fees (in each case, whether or not accrued).

“GAAP” means U.S. generally accepted accounting principles.

“Government Authority” means any U.S. federal, state or local or any
supra-national or non-U.S. government, political subdivision, governmental,
regulatory or administrative authority, instrumentality, agency, body or
commission, self-regulatory organization or any court, tribunal, or judicial or
arbitral body.

“Law” means any U.S. federal, state, local or non-U.S. statute, law, ordinance,
regulation, rule, code, Order or other requirement or rule of law (including
common law).

“Liabilities” means any liability, debt, guarantee, claim, demand, expense,
commitment or obligation (whether direct or indirect, absolute or contingent,
accrued or unaccrued, liquidated or unliquidated, or due or to become due) of
every kind and description, such as revolving facilities, delayed draw term
loans, lines of credit and any other committed but unfunded facilities,
including all costs and expenses related thereto.

“Lien” means any mortgage, deed of trust, pledge, hypothecation, security
interest, encumbrance, claim, lien or charge of any kind.

“Loan Agreement” means each loan agreement, credit agreement, facilities
agreement, participation agreement, sub-participation agreement, note, success
fee agreement, intercreditor agreement, subordination agreement, agreement among
lenders or similar agreement set forth on Schedule A.

“Loan Agreement Agent” means the administrative agent, collateral agent or other
representative of any bank, lender, financial institution or other Person
extending credit under or in connection with any Transferred Loan Agreement or
other contract.

“Loan Parties” means, collectively, any borrower, obligor, grantor, guarantor or
pledger under any of the Transferred Credit Documents,

“Losses” means all losses, damages, costs, obligations, expenses, settlements,
Taxes, awards and liabilities (including reasonable attorneys’ fees and
reasonable costs of investigation).

“Obligor” means any Person that is a borrower or obligor under any Loan
Agreement.

 

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“Order” means any order, writ, judgment, injunction, temporary restraining
order, decree, stipulation, determination or award entered by or with any
Government Authority.

“Parties” means the Seller and the Buyer.

“Permits” means all permits, licenses, Consents, registrations, concessions,
grants, franchises, certificates, identification numbers exemptions, waivers and
filings issued or required by any Government Authority under applicable Law.

“Permitted Liens” means the following Liens: (a) Liens for Taxes, assessments or
other governmental charges or levies that, in each case, are not yet due or
payable; (b) Liens created by or through, or resulting from any facts or
circumstances relating to, Buyer or its Affiliates; (c) Liens arising out of,
under or in connection with this Agreement or the other Transaction Agreements;
(d) other Liens that individually or in the aggregate would not reasonably be
expected to be material to any of the Transferred Assets; and (e) Liens that
have been created pursuant to any applicable Loan Agreement or agreement
relating to the Transferred Equity.

“Person” means any natural person, general or limited partnership, corporation,
company, trust, limited liability company, limited liability partnership, firm,
association or organization or other legal entity.

“Principal Balance” means, with respect to any Loan Agreement at any time, the
outstanding unpaid legal balance (net of any (i) write-offs, (ii) cash interest
received and applied to principal, (iii) specific allowance for impairment and
(iv) unapplied cash, in each case (where applicable)) as per Seller’s books and
records, in accordance with GAAP, held by the applicable Seller Party under such
Loan Agreement at such time.

“Representative” of a Person means the directors, officers, employees, advisors,
agents, consultants, attorneys, accountants, investment bankers or other
representatives of such Person.

“Securities Act” means the Securities Act of 1933, as amended.

“Seller Designee” means any Affiliate of the Seller designated by the Seller as
a “Seller Party” hereunder.

“Seller Fundamental Representations” means the representations and warranties
made in Sections 4.01 (Incorporation and Authority of the Seller Parties;
Enforceability), 4.06 (Brokers), and 4.07 (Title).

“Seller Transaction Agreements” means this Agreement and each other Transaction
Agreement to which any Seller Party is named as a party on the signature pages
thereto.

“Seller Transactions” means the transactions contemplated by the Seller
Transaction Agreements.

 

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“Tax” or “Taxes” means (a) any taxes, levies, fees, imposts, duties or similar
charges (including any interest, fines, assessments, penalties or additions to
tax imposed in connection therewith or with respect thereto) imposed by any
Government Authority, including (i) taxes imposed on, or measured by, income,
franchise, profits or gross receipts, (ii) ad valorem, value added, capital
gains, sales, goods and services, use, real or personal property, capital stock,
license, branch, payroll, estimated withholding, employment, social security (or
similar), unemployment, compensation, utility, severance, production, excise,
stamp, occupation, premium, windfall profits, escheat, unclaimed property,
transfer and gains taxes and (iii) customs duties; (b) any Liability for the
payment of any items described in clause (a) above as a result of (i) being (or
ceasing to be) a member of an affiliated, consolidated, combined, unitary or
aggregate group or (ii) being included (or being required to be included) in any
Tax Return related to such group; and (c) any liability for the payment of any
amounts as a result of any express or implied obligation to indemnify any other
Person, or any successor or transferee liability, in respect of any of the items
described in clause (a) or (b) above.

“Tax Returns” means any returns and reports (including elections, declarations,
disclosures, schedules, estimates, claims for refunds and information returns)
required to be supplied to a Taxing Authority relating to Taxes.

“Taxing Authority” means any U.S. federal, state or local or non-U.S.
jurisdiction (including any subdivision and any revenue agency of a
jurisdiction) imposing Taxes and the agencies, if any, charged with the
collection of such Taxes for such jurisdiction.

“Transaction Agreements” means this Agreement and any other agreements,
documents or instruments contemplated to be executed in connection with the
Transactions.

“Transactions” means the transactions contemplated by this Agreement and the
other Transaction Agreements.

“Transfer Taxes” means any sales Tax, use Tax, direct or indirect real property
transfer or gains Tax, documentary stamp Tax, business and occupation Tax, value
added Tax or similar Taxes and all related fees.

“Transferred Credit Documents” means, collectively, (i) the Transferred Loan
Agreements and (ii) any security agreements, guarantees, mortgages, intellectual
property security agreements, account control agreements, collateral access
agreements and other similar agreements entered into by the Seller (or one of
its Affiliates), in the capacity as agent, lender or other secured party
thereunder, and one or more of the Loan Parties, in connection with any of the
related Transferred Loan Agreements.

“Transferred Equity” means the equity ownership interests set forth on
Schedule A.

“U.S.” means the United States of America.

 

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INDEX OF DEFINED TERMS

 

Action    Exhibit A Affiliate    Exhibit A Agented Transaction    Exhibit A
Agreement    Exhibit A Assumed Liabilities    Section 2.01(c) Bankruptcy and
Equity Exception    Exhibit A Business Day    Exhibit A Buyer    Preamble Buyer
Indemnified Parties    Section 9.02 Buyer Transaction Agreements    Exhibit A
Buyer Transactions    Exhibit A Closing    Section 2.03 Closing Date   
Section 2.03 Closing Date Payment    Section 3.03 Code    Exhibit A Collateral
   Exhibit A Consent    Exhibit A Consultation Period    Section 3.05(b)
Controlling Party    Section 9.04(b) Cutoff Date    Section 7.03(a) Designated
Buyer    Section 2.02(b) Disclosure Schedule    Exhibit A Evaluation Material   
Section 4.10 Excluded Assets    Section 2.01(b) Excluded Liabilities   
Section 2.01(d) Excluded Taxes    Exhibit A Fees    Exhibit A Final Settlement
Statement    Section 3.05(d) GAAP    Exhibit A Government Authority    Exhibit A
Indemnified Party    Section 9.04(a) Indemnifying Party    Section 9.04(a)
Initial Settlement Statement    Section 3.04(a) Law    Exhibit A Liabilities   
Exhibit A Lien    Exhibit A Loan Agreement    Exhibit A Loan Agreement Agent   
Exhibit A Loan Parties    Exhibit A Losses    Exhibit A Notice of Disagreement
   Section 3.05(a) Obligor    Exhibit A Order    Exhibit A Other Transfer
Actions    Section 7.03(a) Parties    Exhibit A

 

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Permits    Exhibit A Permitted Liens    Exhibit A Person    Exhibit A
Post-Closing Adjustment    Section 3.06 Principal Balance    Exhibit A Purchase
Price    Section 3.01(b) Receiving Party    Section 2.02(a) Representative   
Exhibit A Review Period    Section 3.04(c) Securities Act    Exhibit A Seller   
Preamble Seller Designee    Exhibit A Seller Fundamental Representations   
Exhibit A Seller Indemnified Parties    Section 9.03 Seller Parties    Preamble
Seller Transaction Agreements    Exhibit A Seller Transactions    Exhibit A Tax
   Exhibit A Tax Returns    Exhibit A Taxing Authority    Exhibit A Third Party
Claim    Section 9.04(a) Transaction Agreements    Exhibit A Transaction Dispute
   Section 10.12 Transactions    Exhibit A Transfer Taxes    Exhibit A
Transferred Assets    Section 2.01(a) Transferred Equity    Exhibit A
Transferred Credit Documents    Exhibit A Transferred Loan Agreements   
Section 2.01(a)(i) U.S.    Exhibit A

 

 

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