Exhibit 10.1

 

Execution Version

 

 

 

CREDIT AND GUARANTY AGREEMENT

 

by and among

 

HUNT COMPANIES FINANCE TRUST, INC.

 

as Borrower,

 

FIVE OAKS ACQUISITION CORP. AND HUNT CMT EQUITY, LLC

 

as Guarantors,

 

THE LENDERS PARTIES HERETO FROM TIME TO TIME

 

as the Lenders,

 

CORTLAND CAPITAL MARKET SERVICES LLC,

 

together with its successors and assigns

 

as the Administrative Agent

 

and

 

CORTLAND CAPITAL MARKET SERVICES LLC,

 

together with its successors and assigns

 

as the Collateral Agent

 

Dated as of January 15, 2019

 

 

 

 

 

 

TABLE OF CONTENTS

 

    Page       Article I DEFINITION AND CONSTRUCTION 1       1.1 Definitions 1
1.2 Construction 36 1.3 Accounting Terms; GAAP; Pro Forma Calculations 37      
Article II AMOUNT AND TERMS OF LOANS 37       2.1 Credit Facilities 37 2.2
[Reserved] 37 2.3 Interest Rates; Payment of Principal and Interest 37 2.4
Computation of Interest and Fees; Maximum Interest Rate 39 2.5 Request for
Borrowing 40 2.6 [Reserved] 43 2.7 Repayment of Borrowings 43 2.8 Prepayments 43
2.9 Fees 44 2.10 Maintenance of Loan Account; Statements of Obligations 44 2.11
Increased Costs 45 2.12 [Reserved] 45 2.13 Funding Sources 45 2.14 Place of
Loans 46 2.15 Incremental Term Loans 46 2.16 Mitigation of Obligations 49 2.17
Pro Rata Treatment 49       Article III CONDITIONS TO LOANS 49       3.1
Conditions Precedent to the Initial Term Loan 49 3.2 Conditions Precedent to All
Loans 51 3.3 Maturity Date 52       Article IV REPRESENTATIONS AND WARRANTIES OF
THE BORROWER 52       4.1 Due Organization 52 4.2 Securities and Subsidiaries 52
4.3 Requisite Power and Authorization 52 4.4 Binding Agreements 53 4.5 Other
Agreements 53 4.6 Litigation:  Adverse Facts and Compliance with Laws 53 4.7
Government Consents 54 4.8 Title to Assets; Liens 54 4.9 ERISA 54

 

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TABLE OF CONTENTS
(continued)

 

4.10 Payment of Taxes 55 4.11 Governmental Regulation 55 4.12 Disclosure 55 4.13
Debt 55 4.14 Existing Defaults 56 4.15 No Material Adverse Effect 56 4.16
Security Documents 56 4.17 Solvency 56 4.18 Use of Proceeds 56 4.19
Anti-Corruption and Anti-Money Laundering Laws and Sanctions 57 4.20 REIT
Status; Loan Party Tax Status 57 4.21 Ownership 57 4.22 Borrower Financial
Covenants 57       Article V AFFIRMATIVE COVENANTS OF THE BORROWER 57       5.1
Accounting Records and Inspection 57 5.2 Financial Statements 58 5.3
Certificates; Other Information 58 5.4 Existence 59 5.5 Payment of Taxes and
Claims 59 5.6 Compliance with Laws and Material Contractual Obligations 60 5.7
Further Assurances 60 5.8 Payment of Obligations 60 5.9 Maintenance of Insurance
60 5.10 Maintenance of Property and Licenses 60 5.11 Covenant to Guarantee
Obligations and Give Security 61 5.12 ERISA 61 5.13 Post-Closing Items 61 5.14
REIT Status. 61 5.15 Cash Management 61       Article VI NEGATIVE COVENANTS OF
THE BORROWER 61       6.1 Debt 61 6.2 Liens 64 6.3 Debt Prepayments 65 6.4
Dividends 65 6.5 Restriction on Fundamental Changes 65 6.6 Sale of Assets 66 6.7
Transactions with Shareholders and Affiliates 66 6.8 Conduct of Business 67 6.9
Amendments or Waivers of Certain Documents; Actions Requiring the Consent of the
Agents 67 6.10 Limitation on Negative Pledges 67 6.11 Margin Regulation 68 6.12
Financial Covenants 68

 

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TABLE OF CONTENTS
(continued)

 

6.13 Plans 69 6.14 Change of Servicer and Special Servicer 69       Article VII
EVENTS OF DEFAULT AND REMEDIES 69       7.1 Events of Default 69 7.2 Remedies 72
7.3 Borrower’s Right to Cure 73       Article VIII EXPENSES AND INDEMNITIES 73  
    8.1 Expenses 73 8.2 Indemnity 74       Article IX ASSIGNMENT AND
PARTICIPATIONS 74       9.1 Successors and Assigns Generally 75       Article X
AGENT; THE LENDER GROUP 80       10.1 Appointment and Authorization of Agent 80
10.2 Delegation of Duties 81 10.3 General Immunity 81 10.4 Reliance by Agent 82
10.5 Knowledge of Defaults/Events of Default 83 10.6 Credit Decision 83 10.7
Costs and Expenses; Indemnification 84 10.8 Agent in Individual Capacity 84 10.9
Successor Agent 85 10.10 Lender in Individual Capacity 86 10.11 Withholding
Taxes 86 10.12 Collateral and Guarantor Matters 89 10.13 Restrictions on Actions
by Lenders; Sharing of Payments 91 10.14 Agency for Perfection 91 10.15 Payments
by Agent to the Lenders 92 10.16 Concerning the Collateral and Related Loan
Documents 92 10.17 Field Examinations and Examination Reports; Confidentiality;
Disclaimers by Lenders; Other Reports and Information 92 10.18 Several
Obligations; No Liability 93 10.19 [Reserved] 93 10.20 Representations and
Warranties of each Agent 93       Article XI MISCELLANEOUS 94       11.1 No
Waivers, Remedies 94 11.2 Waivers and Amendments 94 11.3 Notices 96 11.4 Release
of Borrowing Base Eligible Assets 96

 

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TABLE OF CONTENTS
(continued)

 

11.5 Valuation Confirmation Process 96 11.6 Headings 98 11.7 Execution in
Counterparts; Effectiveness 98 11.8 GOVERNING LAW 98 11.9 JURISDICTION AND VENUE
99 11.10 WAIVER OF TRIAL BY JURY 99 11.11 Independence of Covenants 99 11.12
Confidentiality 100 11.13 Complete Agreement 100 11.14 Severability 101 11.15
PATRIOT Act Notice 101       Article XII THE GUARANTY 101       12.1 The
Guarantee 101 12.2 Obligations Unconditional 102 12.3 Reinstatement 103 12.4
Certain Additional Waivers 103 12.5 Remedies 104 12.6 Rights of Contribution 104
12.7 Guaranty of Payment; Continuing Guarantee 104 12.8 Representations and
Warranties of each Guarantor 104

 

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CREDIT AND GUARANTY AGREEMENT

 

THIS CREDIT AND GUARANTY AGREEMENT, dated as of January 15, 2019, is entered
into by and among, on the one hand, the lenders identified on the signature
pages hereof, CORTLAND CAPITAL MARKET SERVICES LLC (“Cortland”), as the
administrative agent for the Lenders (in such capacity, together with its
successors and permitted assigns in such capacity, “Administrative Agent”), and
as the collateral agent for the Lenders (in such capacity, together with its
successors and permitted assigns in such capacity, “Collateral Agent” and,
together with the Administrative Agent, the “Agents”), and, on the other hand,
HUNT COMPANIES FINANCE TRUST, INC., a Maryland corporation (“Borrower”), FIVE
OAKS ACQUISITION CORP., a Delaware corporation (“FOAC”), HUNT CMT EQUITY, LLC, a
Delaware limited liability company (“Hunt CMT Equity” and together with FOAC,
the “Guarantors” and each individually a “Guarantor”).

 

The parties agree as follows:

 

Article I

 

DEFINITION AND CONSTRUCTION

 

1.1           Definitions. For purposes of this Agreement (as defined below),
the following initially capitalized terms shall have the following meanings:

 

“Additional Lender” has the meaning set forth in Section 2.15(b).

 

“Adjusted EBITDA” means, for any period, for Borrower and its Subsidiaries on a
consolidated basis, an amount equal to (a) GAAP net income plus (i) realized and
unrealized losses, (ii) interest expenses, (iii) depreciation and amortization,
(iv) taxes, (vi) other non-cash expenses considered to be non-operating in
nature minus (b)(i) interest expense on warehousing debt and securitizations and
(ii) realized and unrealized gains.

 

“Administrative Agent” has the meaning set forth in the preamble to this
Agreement.

 

“Administrative Questionnaire” means an Administrative Questionnaire in a form
supplied by the Administrative Agent.

 

“Affiliate” means, with respect to any Person, any other Person which, directly
or indirectly, controls, is controlled by, or is under common control with, such
Person. For purposes of this definition, “control” (together with the
correlative meanings of “controlled by” and “under common control with”) means
possession, directly or indirectly, of the power (a) to vote 15% or more of the
securities (on a fully diluted basis) having ordinary voting power for the
directors or managing general partners (or their equivalent) of such Person, or
(b) to direct or cause the direction of the management or policies of such
Person, whether through the ownership of voting securities, by contract, or
otherwise; provided, that no issuer of a Specified Third Party Securitization
shall be considered an “Affiliate” of such Person; provided, further, that Hunt
Investment Management, LLC and its affiliates shall not be considered an
“Affiliate” of the Borrower or any of its subsidiaries.

 

 - 1 - 

 

 

“Agency” means The Federal National Mortgage Association, The Federal Home Loan
Mortgage Corporation, The Government National Mortgage Association, the Federal
Housing Administration, a division of HUD, and including the Federal Housing
Commissioner and the Secretary of HUD where appropriate under the FHA
Regulations, United States Department of Housing and Urban Development, Consumer
Financial Protection Bureau, an agency of the United States, the U.S. Department
of Veterans Affairs, an executive branch department of the United States of
America headed by the Secretary of Veterans Affairs, or any successor of the
foregoing.

 

“Agent” or “Agents” has the meaning set forth in the preamble to this Agreement.

 

“Agent’s Account” means a Deposit Account as designated in writing by the
applicable Agent to the Borrower and the Lenders form time to time.

 

“Agent Fee Letter” means that certain fee letter agreement dated as of the
Closing Date by and between Borrower and Cortland.

 

“Agent-Related Persons” means any Agent, together with its Affiliates, partners,
directors, officers, employees, agents, trustees, administrators, managers,
advisors and representatives.

 

“Agreement” means this Credit and Guaranty Agreement by and among the Borrower,
the Guarantors, the Lenders and the Agents, together with all exhibits and
schedules hereto.

 

“Anticipated Repayment Date” means, the five-year anniversary of the Closing
Date.

 

“Anti-Corruption Laws” means all laws, rules, and regulations of any
jurisdiction applicable to any Loan Party from time to time concerning or
relating to bribery or corruption, including without limitation the United
States Foreign Corrupt Practices Act of 1977, as amended and other similar
legislation in any other jurisdictions.

 

“Anti-Money Laundering Laws” means applicable laws or regulations in any
jurisdiction in which the Borrower or any Loan Party is located or doing
business that relates to money laundering, any predicate crime to money
laundering, or any financial record keeping and reporting requirements related
thereto.

 

“Applicable Advance Rate” means, for each Borrowing Base Eligible Asset, the
percentage as set forth below:

 

Senior Commercial Real Estate Loan             Multi-Family:   80%       
Non-Multi-Family:   75%        Senior Commercial Real Estate Construction Loan 
           Multi-Family:   65%        Non-Multi-Family:   60%       
Subordinated Commercial Real Estate Loan:   50%        Preferred Equity
Investment:   45%        Borrowing Base Subsidiary and Borrowing Base Debt
Subsidiary:   50%        Initial MSRs:   40%        MSRs (other than Initial
MSRs):   50%        Cash:   100%

 

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The Applicable Advance Rate for a Borrowing Base Eligible Asset comprised of
equity interests in a Borrowing Base Subsidiary (other than a Borrowing Base
Debt Subsidiary) shall be determined and applied with respect to each Mortgage
Asset held by such Borrowing Base Subsidiary based on the Applicable Advance
Rates applicable to such type of Mortgage Asset as set forth above.

 

“Application Event” means the occurrence of (a) a failure by the Borrower to
repay in full all of the Obligations on the Maturity Date, or (b) an Event of
Default and the election by the Required Lenders to require that payments and
Proceeds of Collateral be applied pursuant to Section 2.3(a)(ii)(E) and (F) of
this Agreement.

 

“Approved Fund” means any fund that is administered or managed by (a) a Lender,
(b) an Affiliate of a Lender, (c) an entity or an Affiliate of an entity that
administers or manages a Lender or (d) an entity that is managed or advised by
the investment manager or investment advisor of a Lender.

 

“Asset” means any interest of a Person in any kind of property or asset, whether
real, personal, or mixed real and personal, or whether tangible or intangible;
provided, that “Assets” shall be determined without regard to the effects of
consolidation of any issuer of a Specified Third Party Securitization on the
financial statements of such Person under Accounting Standards Codification
Section 810, as amended, modified or supplemented from time to time, or
otherwise under GAAP.

 

“Asset Coverage Ratio” means, as of any date of determination, the ratio of (a)
the Borrowing Base to (b) the aggregate principal amount of funded and
outstanding Loans.

 

“Assigned Value” means, as of any date of determination, as to any single asset
included as a Borrowing Base Eligible Asset, the value of such Borrowing Base
Eligible Asset as of such date of determination as set forth below:

 

(a)at any time prior to the occurrence of a VAE:

 

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(i)which is a Mortgage Asset shall, in each case, be the current outstanding
principal balance of such Borrowing Base Eligible Asset (not taking into account
any amounts held in reserves in respect of such Mortgage Asset);

 

(ii)which is comprised of the equity interests of a Borrowing Base Debt
Subsidiary shall be the excess of (A) the current outstanding principal balance
of the Mortgage Assets held by such Borrowing Base Debt Subsidiary plus any
restricted cash held in the Borrowing Base Debt Subsidiary (not taking into
account any amounts held in reserves) over (B) the current outstanding principal
balance of the associated Warehousing Debt, Securitization Indebtedness and/or
all other debt outstanding owed related to such Mortgage Assets (not taking into
account any amounts held in reserves in respect of the related Mortgage Assets);
provided, that only debt to unaffiliated third parties shall be taken into
account for purposes of clause (B) so long as any debt owed to Affiliates of the
Borrower is pledged as Collateral (directly or indirectly) to the Collateral
Agent for the benefit of the Lenders;

 

(iii)which is comprised of the equity interests of a Borrowing Base Subsidiary
that is not a Borrowing Base Debt Subsidiary, shall be the current outstanding
principal balance of the Mortgage Assets held by such Borrowing Base Subsidiary
(not taking into account any amounts held in reserves in respect of the related
Mortgage Assets, outstanding Debt and other liabilities);

 

(iv)which are MSRs, the aggregate fair market value of such MSRs, determined by
the MSR Valuation Agent, on a quarterly basis (which market value shall be
subject to the Valuation Confirmation Process, except that (1) any valuations
shall be provided by a MSR Valuation Agent and (2) such Valuation Confirmation
Process shall occur regardless of whether or not a VAE has occurred); and

 

(v)for all other Borrowing Base Eligible Assets, the current outstanding
principal balance of such Borrowing Base Eligible Assets (not taking into
account any amounts held in reserves in respect of such Borrowing Base Eligible
Assets, outstanding Debt and other liabilities).

 

(b)          At any time following the occurrence of a VAE, the “Assigned Value”
in respect of any Borrowing Base Eligible Asset:

 

(i)which is either a Subordinated Commercial Real Estate Loan or Preferred
Equity Investment and has experienced a VAE under clause (i) or (ii) of the
definition thereof, for the first thirty (30) days after the VAE, 50% times the
Assigned Value determined pursuant to clause (a)(i) above and, thereafter for so
long as such VAE continues to apply, zero (unless a valuation by a Valuation
Agent has been obtained by the Borrower, in which case, the Assigned Value shall
be the product of (1) Determined Valuation of the underlying mortgaged property
multiplied by (2) the loan to value ratio of such Borrowing Base Eligible Asset
as of its origination date);

 

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(ii)which is either a Subordinated Commercial Real Estate Loan or Preferred
Equity Investment and has experienced a VAE under clause (iii), (iv) or (vi) of
the definition thereof, for the first thirty (30) days after the VAE, 75% times
the Assigned Value determined pursuant to clause (a)(i) above and, thereafter
for so long as such VAE continues to apply, zero (unless a valuation by a
Valuation Agent has been obtained by the Borrower, in which case, the Assigned
Value shall be the product of (1) Determined Valuation of the underlying
mortgaged property multiplied by (2) the loan to value ratio of such Borrowing
Base Eligible Asset as of its origination date);

 

(iii)which is comprised of the equity interests of a Borrowing Base Debt
Subsidiary and has experienced a VAE under clause (i) or (ii) of the definition
thereof (and which Assigned Value shall only be applied to the particular
underlying Mortgage Asset(s) which has experienced a VAE), for the first thirty
(30) days after such VAE, 50% times the Assigned Value determined pursuant to
clause (a)(ii) above and, thereafter for so long as such VAE continues to apply,
zero (unless a valuation by a Valuation Agent has been obtained by the Borrower
with respect to each affected Mortgage Asset, in which case, the Assigned Value
shall be determined in accordance with clause (a)(ii) above with respect to the
affected Mortgage Assets except that the following calculation shall be used for
purposes of clause (a)(ii)(A) above: the product of (1) Determined Valuation
multiplied by (2) loan to value ratio of such Borrowing Base Eligible Asset as
of its origination date);

 

(iv)which is comprised of the equity interests of a Borrowing Base Debt
Subsidiary and has experienced a VAE under clause (v) of the definition thereof,
clause (vi) of the definition thereof (but only to the extent the occurrence of
a material modification of an Borrowing Base Eligible Asset or a Mortgage Asset
held by a Borrowing Base Debt Subsidiary results in a modification that has a
material adverse effect on such Borrowing Base Debt Subsidiary) or clause (vii)
of the definition thereof, for the first thirty (30) days after such VAE, 75%
times the Assigned Value determined pursuant to clause (a)(ii) above and,
thereafter for so long as such VAE continues to apply, zero (unless a valuation
by a Valuation Agent has been obtained by the Borrower with respect to each
affected Mortgage Asset, in which case, the Assigned Value shall be determined
in accordance with clause (a)(ii) above with respect to the affected Mortgage
Assets except that the following calculation shall be used for purposes of
clause (a)(ii)(A) above: the product of (1) Determined Valuation of the
underlying mortgaged property multiplied by (2) the loan to value ratio of such
Borrowing Base Eligible Asset as of its origination date);

 

(v)which is comprised of the equity interests of a Borrowing Base Subsidiary
that is not a Borrowing Base Debt Subsidiary (and which Assigned Value shall be
applied only to the particular underlying Mortgage Asset(s) which has
experienced a VAE), the Assigned Value shall be determined and applied with
respect to each Mortgage Asset held by such Borrowing Base Subsidiary based on
clauses (i), (ii), (iii), (vi) and (vii) of this section (b);

 

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(vi)which is either a Senior Commercial Real Estate Loan, a Senior Commercial
Real Estate Construction Loan and has experienced a VAE, for the first thirty
(30) days after the VAE, 90% times the Assigned Value determined pursuant to
clause (a)(i) above, between thirty-one (31) days after the VAE and sixty (60)
days after the VAE, 80% times the Assigned Value determined pursuant to clause
(a)(i) above, between sixty-one (61) days after the VAE and ninety (90) days
after the VAE, 70% times the Assigned Value determined pursuant to clause (a)(i)
above and, thereafter for so long as such VAE continues to apply, zero (unless a
valuation by a Valuation Agent has been obtained by the Borrower, in which case,
the Assigned Value shall be the product of (1) Determined Valuation of the
underlying mortgaged property multiplied by (2) the loan to value ratio of such
Borrowing Base Eligible Asset as of its origination date); and

 

(vii)which is comprised of any Borrowing Base Eligible Asset that is not covered
under clauses (i) through (vi) above and has experienced a VAE, for the first
thirty (30) days after the VAE, 75% times the Assigned Value determined pursuant
to clause (a) above and, thereafter for so long as such VAE continues to apply,
zero (unless a valuation by a Valuation Agent has been obtained by the Borrower,
in which case, the Assigned Value shall be the product of (1) Determined
Valuation of the underlying asset multiplied by (2) the loan to value ratio of
such Borrowing Base Eligible Asset as of its origination date).

 

For avoidance of doubt, a Mortgage Asset in a Borrowing Base Debt Subsidiary
which has experienced a VAE will only trigger a VAE for that individual Mortgage
Asset and not for the entire Borrowing Base Debt Subsidiary.

 

“Assignment and Acceptance” means an Assignment and Acceptance Agreement
substantially in the form of Exhibit A-1 or such other form approved by the
Administrative Agent.

 

“B Note” means a promissory note secured by a mortgage on multi-family or
commercial real estate property, which note is subordinate in right of payment
to one or more separate promissory notes secured by the same property.

 

“Bankruptcy Code” means title 11 of the United States Code, 11 U.S.C. §§ 101 et
seq., as amended or supplemented from time to time, and any successor statute,
and all of the rules and regulations issued or promulgated in connection
therewith.

 

“Bankruptcy Plan” has the meaning set forth in Section 9.1(f)(iii).

 

“Basel III” means the agreements on capital requirements, leverage ratio and
liquidity standards contained in “Basel III: A global regulatory framework for
more resilient banks and banking systems”, “Basel III: International framework
for liquidity risk measurement, standards and monitoring” and “Guidance for
national authorities operating the countercyclical capital buffer” published by
the Basel Committee on Banking Supervision on 16 December 2010, each as amended,
supplemented or restated.

 

 - 6 - 

 

 

“Board of Directors” means, as to any Person, the board of directors (or
comparable managers) of such Person, or any committee thereof duly authorized to
act on behalf of the board of directors (or comparable managers).

 

“Board of Governors” means the Board of Governors of the Federal Reserve System
of the United States of America, or any successor thereto.

 

“Borrower” has the meaning set forth in the introduction to this Agreement.

 

“Borrower Affiliate” means any Affiliate of the Borrower (other than a natural
Person, or a holding company, investment vehicle or trust for or owned and
operated for the primary benefit of a natural Person or the Borrower and its
Subsidiaries).

 

“Borrower DACA” means the deposit account control agreement by and among the
Borrower, Wells Fargo and the Collateral Agent with respect to the Borrower’s
deposit account number              .

 

“Borrower Financial Covenants” shall mean the covenants set forth in Section
6.12.

 

“Borrowing Base” means, as of any date of determination, the sum of the
Borrowing Base Value of each Borrowing Base Eligible Asset as of such date as
determined by the most recent Borrowing Base Certificate and adjusted as
reflected in any Determined Valuation; provided that, at the time of origination
or purchase by the Borrower or its Subsidiaries of a Borrowing Base Eligible
Asset, the allocated Borrowing Base Value of any single property underlying any
Borrowing Base Eligible Asset shall not comprise in excess of 10.0% of the total
Borrowing Base Value of all Borrowing Base Eligible Assets (and any such excess
shall be disregarded for purposes of determining the Borrowing Base); provided,
further, that the Borrowing Base shall be recalculated on (i) the last day of
each fiscal quarter, (ii) the date on which any Loan is requested and (iii) the
date on which the Borrower has actual knowledge of a VAE.

 

“Borrowing Base Certificate” means a certificate, signed and certified as
accurate and complete by a Responsible Officer of the Borrower, in substantially
the form of Exhibit B-1.

 

“Borrowing Base Debt Subsidiary” means any Subsidiary of the Borrower that has
associated Warehousing Debt, Securitization Indebtedness or other debt
outstanding.

 

“Borrowing Base Deficiency” means the circumstance that exists in the event that
the outstanding aggregate principal amount of the Loans outstanding under this
Agreement exceeds the Borrowing Base on any date of determination.

 

“Borrowing Base Eligibility Criteria” means,

 

(a)           with respect to an asset which the Borrower represents and
warrants is a Borrowing Base Eligible Asset:

 

 - 7 - 

 

 

(i)Such asset is (x) held by the Borrower or a Subsidiary thereof (other than a
Borrowing Base Subsidiary) and is (A) a Senior Commercial Real Estate Loan,
(B) a Subordinated Commercial Real Estate Loan, (C) a Preferred Equity
Investment (directly or indirectly) or (D) a Senior Commercial Real Estate
Construction Loan, (y) an equity interest in a Borrowing Base Subsidiary that is
not a Borrowing Base Debt Subsidiary, which subsidiary holds (directly or
indirectly), any asset referred to in subclause (x) of this clause (i) that
would otherwise qualify as Borrowing Base Eligible Asset or (z) an equity
interest in a Borrowing Base Debt Subsidiary that (A) owns (directly or
indirectly), any asset referred to in subclause (x) of this clause (i) that
would otherwise qualify as Borrowing Base Eligible Assets and (B) to the extent
the Borrowing Base Debt Subsidiary owns any asset of the type set forth in
subclauses (x)(B) or (x)(C) of this clause (i), such assets do not exceed 15% of
the total assets held by such subsidiary as measured by the respective
outstanding principal balance of all assets held by such subsidiary, including,
without limitation, any assets of the type set forth in subclauses (x)(B) or
(x)(C) of this clause (i);

 

(ii)such asset (or, in the case of any Borrowing Base Subsidiary, the associated
Mortgage Asset), together with the underlying loan documents related thereto
(A) is in full force and effect and constitutes the legal, valid and binding
obligation of the obligor thereunder (subject to customary qualifications and
exceptions), (B) is not subject to any material litigation or dispute and
(C) contains provisions that the obligor’s payment obligations thereunder are
absolute and unconditional without any right of rescission, setoff, counterclaim
or defense against the holder thereof (subject to customary qualifications and
exceptions);

 

(iii)such asset (or, in the case of any Borrowing Base Subsidiary, the
associated Mortgage Asset) and any related collateral are each in compliance in
all material respects with any applicable laws (subject to customary
qualifications and exceptions);

 

(iv)at the time of purchase or origination (as applicable), such asset (or, in
the case of any Borrowing Base Subsidiary, the associated Mortgage Asset) is not
in payment default. At any time thereafter, such asset or Mortgage Asset is not
in payment default after giving effect to any applicable grace, cure or notice
periods (as such periods may be extended);

 

(v)for any Subordinated Commercial Real Estate Loan or Preferred Equity
Investment, such asset (or, in the case of any Borrowing Base Subsidiary, the
associated Mortgage Asset) is eligible to be sold and does not by its terms
prohibit the granting of a security interest therein, subject to Section 6.2(d);

 

(vi)such asset (or, in the case of any Borrowing Base Subsidiary, the associated
Mortgage Asset) does not contain a confidentiality provision that would prohibit
the Agents from reviewing the asset and underlying loan documentation
(notwithstanding that the Agents are advised of the confidential nature of
information relating to the asset and agrees to keep such information
confidential);

 

 - 8 - 

 

 

(vii)the applicable Subsidiary of the Borrower has good and marketable title to,
and is the sole owner of, such asset (or, in the case of any Borrowing Base
Subsidiary, the associated Mortgage Asset) subject, in the case of Mortgage
Assets of Borrowing Base Debt Subsidiaries, to the terms of the associated
Warehousing Debt, Securitization Indebtedness or other applicable debt;

 

(viii)such asset (or, in the case of any Borrowing Base Subsidiary, the
associated Mortgage Asset) will not cause the Borrower to be required to
register as an investment company under the Investment Company Act of 1940;

 

(ix)such asset (or, in the case of any Borrowing Base Subsidiary, the associated
Mortgage Asset) is not a Margin Security;

 

(x)for any Subordinated Commercial Real Estate Loan or Preferred Equity
Investment, whether held directly or by a Borrowing Base Subsidiary or Borrowing
Base Debt Subsidiary, the loan to value percentage of all indebtedness senior to
such asset (or, in the case of any Borrowing Base Subsidiary or Borrowing Base
Debt Subsidiary, the associated Mortgage Asset) does not exceed 80% and the
combined loan to value percentage for such asset including the subordinated
mortgage loan or preferred equity does not exceed 90%;

 

(xi)such asset is cash or Cash Equivalents held in a Deposit Account that is the
subject of a control agreement in favor of the Collateral Agent for the benefit
of the Secured Parties; provided that, any cash or Cash Equivalents pledged
under Section 6.2(c) to secure Debt permitted under Section 6.1(l) shall not be
a Borrowing Base Eligible Asset;

 

(xii)for any Securities that are encumbered by or otherwise subject to a
Permitted Collateral Lien (other than in respect to Liens arising pursuant to
clauses (d) and (g) of the definition thereof) such Securities have not been
encumbered by or otherwise subject to such Permitted Collateral Lien for longer
than ten (10) Business Days after Borrower or any Grantor, as applicable,
obtains knowledge thereof;

 

(xiii)such asset (or, in the case of any Borrowing Base Subsidiary, the
associated Mortgage Asset) is not secured by hotels or retail malls (other than
strip centers);

 

(xiv)such asset (or, in the case of any Borrowing Base Subsidiary, the
associated Mortgage Asset) has been originated in accordance with the
Underwriting Guidelines;

 

(xv)such asset (or, in the case of any Borrowing Base Subsidiary, the associated
Mortgage Asset) which is a health care bridge loan shall be eligible for takeout
financing by a government sponsored agency upon completion of construction
and/or business plan, as applicable;

 

(xvi)such asset (or, in the case of any Borrowing Base Subsidiary, the
associated Mortgage Asset) which is a Mortgage Asset backed by multi-family
properties has an “as-is” loan to value ratio of no greater than 82.5% and an
“as-renovated” loan to value ratio of no greater than 80%;

 

 - 9 - 

 

 

(xvii)such asset (or, in the case of any Borrowing Base Subsidiary, the
associated Mortgage Asset) which is a Mortgage Asset backed by non-multi-family
properties has an “as-is” loan to value ratio of no greater than 80% and an
“as-renovated” loan to value ratio of no greater than 75%;

 

(xviii)such asset (or, in the case of any Borrowing Base Subsidiary, the
associated underlying asset) which is a security must have a CUSIP number and be
issued by the Borrower or its Affiliate or the Borrower’s external manager or
its Affiliates and further must be collateralized by loans originated by
Borrower or its Affiliate or the Borrower’s external manager or its Affiliates
in accordance with the Underwriting Guidelines;

 

(xix)for such assets (or, in the case of any Borrowing Base Subsidiary, the
associated underlying asset) which are MSRs, (A) the Borrower or its Affiliate
has obtained (continues to maintain) all required consents and approvals to
service such MSRs and to pledge such MSRs to the Collateral Agent on behalf of
the Lenders (with any related acknowledgment agreements (if any) in form and
substance acceptable to the Required Lenders), (B) the related servicer has not
received a termination notice or otherwise been terminated under the related
servicing agreement and (C) with respect to the Initial MSRs only, the related
Grantor shall not remove any such pool of MSRs from the Borrowing Base (in
connection with a sale or otherwise) unless MSRs relating to all four of the
Securitization Transactions are removed from the Borrowing Base, in each case,
unless otherwise agreed to by the Required Lenders acting in their sole and
absolute discretion;

 

(xx)the Collateral Agent on behalf of the Lenders shall have a first priority
security interest in such Borrowing Base Eligible Asset (or if a Borrowing Base
Eligible Asset is held directly or indirectly by a Borrowing Base Subsidiary
whose equity interests are pledged to the Collateral Agent on behalf of the
Lenders, then the Collateral Agent on behalf of the Lenders shall have a first
priority security interest in the equity of such Borrowing Base Subsidiary).

 

(b)          the Borrower represents and warrants that the Borrowing Base
Eligible Assets meet the following portfolio criteria:

 

(i)no more than 20% of the Borrowing Base Eligible Assets (by Assigned Value)
shall be secured by non-mall retail properties;

 

(ii)no single asset (or, in the case of any Borrowing Base Subsidiary, the
associated Mortgage Asset) shall constitute more than 12.5% of the Borrowing
Base Eligible Assets (by Assigned Value);

 

(iii)no single sponsor of an asset shall constitute more than 20% of the
Borrowing Base Eligible Assets (by Assigned Value);

 

 - 10 - 

 

 

(iv)no more than 10% of the Borrowing Base Eligible Assets (by Assigned Value)
shall be MSRs and no MSRs shall be held in a Borrowing Base Debt Subsidiary;

 

(v)no more than 10% of the Borrowing Base Eligible Assets (by Assigned Value)
shall be assets that are not originated by the Borrower or its Affiliates;
provided that such limitation shall not apply to assets originated by Borrower’s
external manager or its Affiliates;

 

(vi)no more than 15% of the Borrowing Base Eligible Assets (by Assigned Value)
shall constitute health care bridge loans;

 

(vii)no asset shall be a non-U.S. asset or an asset which is not denominated in
U.S. Dollars;

 

(viii)no asset shall be a participation interest in a loan for which none of the
Borrower or its Affiliates or the Borrower’s external manager or its Affiliates
holds majority lender status or similar voting control for the subject loan;

 

(ix)no asset shall be (or represent an interest in) a subordinate or mezzanine
loan in a commercial real estate construction loan;

 

(x)at the time of origination or purchase by the Borrower or its Subsidiaries of
any Borrowing Base Eligible Asset, the outstanding principal balance of any
single property underlying any Borrowing Base Eligible Asset shall not exceed
10.0% of the aggregate outstanding principal balance of the value of all
properties underlying all Borrowing Base Eligible Assets; and

 

(xi)no more than 25% of the Borrowing Base Eligible Assets (by Assigned Value)
in the aggregate shall be fixed rate assets;

 

provided, however, that for purposes of calculating the concentration limits set
forth in clause (b) above, the Assigned Value for any Borrowing Base Eligible
Asset in a Borrowing Base Debt Subsidiary shall be used without taking into
account the outstanding principal balance of the associated Warehousing Debt or
Securitization Indebtedness of such Borrowing Base Debt Subsidiary.

 

“Borrowing Base Eligible Assets” means (a) on and from the Closing Date, the
assets set forth on Schedule C-1 and (b) as of any date of determination after
the Closing Date, the assets that (pursuant to a Borrowing Base Certificate) the
Borrower has represented and warranted satisfies the Borrowing Base Eligibility
Criteria (except to the extent compliance with any one or more of such Borrowing
Base Eligibility Criteria is waived by the Agents in writing with respect to any
such asset). In the event an asset ceases to satisfy the Borrowing Base
Eligibility Criteria, it shall no longer constitute a Borrowing Base Eligible
Asset.

 

“Borrowing Base Subsidiary” means any Subsidiary of the Borrower whose equity
interests constitute Borrowing Base Eligible Assets pursuant to subclauses
(i)(x), (i)(y) or (i)(z) of the definition of Borrowing Base Eligibility
Criteria and shall include, without limitation, all Borrowing Base Debt
Subsidiaries listed on Schedule C-2.

 

 - 11 - 

 

 

“Borrowing Base Value” means, with respect to any Borrowing Base Eligible Asset
as of any date of determination, the sum of (a) product of (x) the Applicable
Advance Rate for such Borrowing Base Eligible Asset as of such date and (y) the
Assigned Value of such Borrowing Base Eligible Asset as of such date, plus (b)
the consolidated unrestricted cash and Cash Equivalents of the Borrower and its
Subsidiaries but only to the extent that such unrestricted cash and Cash
Equivalents are (i) not already accounted for in the Assigned Value of a
Borrowing Base Eligible Asset and (ii) in a Deposit Account that is the subject
of a control agreement in favor of the Collateral Agent for the benefit of the
Secured Parties.

 

“Business Day” means a day when major commercial banks are open for business in
New York, New York, other than Saturdays or Sundays.

 

“Capital Event” means any common or preferred equity offering of the Borrower.

 

“Capitalized Lease Obligations” means with respect to any Person, the amount of
all obligations of such Person to pay rent or other amounts under a lease of
property to the extent and in the amount that such obligations are required to
be classified and accounted for as a capital lease on a balance sheet of such
Person in accordance with GAAP.

 

“Cash Cure Amount” has the meaning set forth in Section 7.3(c).

 

“Cash Equivalents” means (a) marketable direct obligations issued by, or
unconditionally guaranteed by, the United States or issued by any agency thereof
and backed by the full faith and credit of the United States, in each case
maturing within 1 year from the date of acquisition thereof, (b) marketable
direct obligations issued by any state of the United States or any political
subdivision of any such state or any public instrumentality thereof maturing
within 1 year from the date of acquisition thereof and, at the time of
acquisition, having one of the two highest ratings obtainable from either
Standard & Poor’s Rating Group (“S&P”) or Moody’s Investors Service, Inc.
(“Moody’s”), (c) commercial paper maturing no more than two hundred seventy
(270) days from the date of creation thereof and, at the time of acquisition,
having a rating of at least A-1 from S&P or at least P-1 from Moody’s, (d)
certificates of deposit or bankers’ acceptances maturing within 1 year from the
date of acquisition thereof issued by any bank organized under the laws of the
United States or any state thereof having at the date of acquisition thereof
combined capital and surplus of not less than $250,000,000, (e) demand deposit
accounts maintained with any bank organized under the laws of the United States
or any state thereof having combined capital and surplus of not less than
$1,000,000,000, so long as the amount maintained with any individual bank is
less than or equal to $1,000,000 and is insured by the Federal Deposit Insurance
Corporation, or larger amounts, to the extent that such amounts are covered by
insurance which is reasonably satisfactory to the Required Agents, (f) demand
deposit accounts maintained with any of the financial institutions listed on
Schedule A-1 hereto (as may be modified from time to time with the consent of
the Required Agents, which consent shall not be unreasonably withheld or
delayed), Affiliates thereof, or any Lender that is a bank that is insured by
the Federal Deposit Insurance Corporation, and (g) Investments in money market
funds substantially all of whose assets are invested in the types of assets
described in clauses (a) through (e) above.

 

 - 12 - 

 

 

“Change in Law” means the occurrence, after the date of this Agreement, of any
of the following: (a) the adoption or taking effect of any law, rule, regulation
or treaty. (b) any change in law, rule or treaty in the administration,
interpretation, implementation or application thereof by any Governmental
Authority or (c) the making or issuance of any request, rule, guideline or
directive (whether or not having the force of law) by any Governmental
Authority; provided that notwithstanding anything herein to the contrary, (x)
the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests,
rules, guidelines or directives thereunder or issued in connection therewith and
(y) all requests, rules, guidelines or directives promulgated by the Bank for
International Settlements, the Basel Committee on Banking Supervision (or any
successor or similar authority) or the United States or foreign authorities, in
each case pursuant to Basel III, shall in each case be deemed to be a “Change in
Law”, regardless of the date enacted, adopted or issued.

 

“Change of Control Event” means the occurrence of any of the following events
has occurred without the prior written approval of the Required Lenders:

 

(a)          any “person” or “group” (within the meaning of Section 13(d) or
14(d) of the Exchange Act) shall become, or obtain rights (whether by means of
warrants, options or otherwise) to become, the “beneficial owner” (as defined in
Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of a
percentage of the total voting power of all classes of capital stock of the
Borrower entitled to vote generally in the election of directors, of thirty-five
percent (35%) or more;

 

(b)          the Borrower shall cease to maintain its status as a publicly
traded REIT;

 

(c)          the consummation of a merger or consolidation of the Borrower with
or into another entity or any other reorganization of the Borrower pursuant to
which the Borrower is not the surviving entity following such merger,
consolidation or reorganization;

 

(d)          a transfer of all or substantially all of the Borrower’s Assets
(excluding any transfer in connection with any Securitization Transaction or any
repurchase or other similar transactions);

 

provided that, notwithstanding anything to the contrary herein, any event that
does not result in a Change of Manager Event, will not constitute a Change of
Control Event.

 

“Change of Manager Event” means Hunt Investment Management, LLC or any of its
Affiliates ceases to be the manager of the Borrower in accordance with the terms
of that certain Asset Management Agreement dated January 8, 2018 (as amended
from time to time, the “Asset Management Agreement”), and a replacement for such
manager, which replacement shall be approved by the Required Lenders, has not
occurred within ninety (90) days.

 

“Closing Date” means the date on which each of the conditions precedent
specified in Section 3.1 have been satisfied or waived in a manner reasonably
satisfactory to the Agent and the Lenders.

 

 - 13 - 

 

 

“Code” means the Internal Revenue Code of 1986, as amended or supplemented from
time to time, and any successor statute, and all of the rules and regulations
issued or promulgated in connection therewith.

 

“Collateral” has the meaning ascribed thereto in the Security Agreement;
provided, however, that, to the extent such Collateral is denominated in a
currency, such denomination shall be in Dollars.

 

“Collateral Agent” has the meaning set forth in the preamble to this Agreement.

 

“Collateral Agent’s Liens” means the Liens granted by any Loan Party to the
Collateral Agent, for the benefit of the Lenders, under the Loan Documents.

 

“Collections” means all cash, checks, notes, instruments, and other items of
payment.

 

“Commitments” means any Term Loan Commitment or Incremental Term Loan
Commitment, as applicable.

 

“Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. §§ 1 et
seq.), as amended from time to time, and any successor statute.

 

“Compliance Certificate” means a certificate duly executed by a Responsible
Officer of the Borrower, substantially in the form of Exhibit P-1.

 

“Connection Income Taxes” means Other Connection Taxes that are imposed on or
measured by net income (however denominated) or that are franchise Taxes or
branch profits Taxes.

 

“Contingent Obligation” means, as to any Person and without duplication of
amounts, any written obligation of such Person guaranteeing or intended to
guarantee (whether guaranteed, endorsed, co-made, discounted, or sold with
recourse to such Person) any Debt, noncancellable lease, dividend, reimbursement
obligations relating to letters of credit, or any other obligation that pertains
to Debt, a noncancellable lease, a dividend, or a reimbursement obligation
related to letters of credit (each, a “primary obligation”) of any other Person
(“primary obligor”) in any manner, whether directly or indirectly, including any
written obligation of such Person, irrespective of whether contingent, (a) to
purchase any such primary obligation, (b) to advance or supply funds (whether in
the form of a loan, advance, stock purchase, capital contribution, or otherwise)
(i) for the purchase, repurchase, or payment of any such primary obligation or
any Asset constituting direct or indirect security therefor, or (ii) to maintain
working capital or equity capital of the primary obligor, or otherwise to
maintain the net worth, solvency, or other financial condition of the primary
obligor, or (c) to purchase or make payment for any Asset, securities, services,
or noncancellable lease if primarily for the purpose of assuring the owner of
any such primary obligation of the ability of the primary obligor to make
payment of such primary obligation.

 

“Contractual Obligation” means, as applied to any Person, any indenture,
mortgage, deed of trust, contract, undertaking, agreement, or other instrument
to which that Person is a party or by which any of its Assets is subject.

 

 - 14 - 

 

 

“Cortland” has the meaning set forth in the introduction to this Agreement.

 

“Credit Facilities” means each of (a) the Term Loan Commitments and the Initial
Term Loans made thereunder and (b) the Incremental Term Commitments and the
Incremental Term Loans made thereunder.

 

“Cure Expiration Date” has the meaning set forth in Section 7.3(a).

 

“Debt” means, with respect to any Person, (a) all indebtedness, whether or not
represented by bonds, debentures, notes, securities, or other evidences of
indebtedness, for the repayment of money borrowed, (b) all indebtedness
representing deferred payment of the purchase price of property or Assets,
exclusive of trade payables that are due and payable in the ordinary course of
such Person’s business, (c) all Capitalized Lease Obligations of such Person and
(d) all indebtedness currently due and payable under guaranties, endorsements,
assumptions, or other Contingent Obligations in respect of the foregoing;
provided that “Debt” shall be determined without regard to the effects of
consolidation of any issuer of a Specified Third Party Securitization on the
financial statements of such Person under Accounting Standards Codification
Section 810, as amended, modified or supplemented from time to time, or
otherwise under GAAP.

 

“Debt for Borrowed Money” means any Debt for borrowed money incurred in
connection with corporate borrowings. For the avoidance of doubt, “Debt for
Borrowed Money” shall exclude Debt permitted under Sections 6.1(c), (d), (e),
(f), (g), (j), (l), (m) and (n).

 

“Debtor Relief Laws” means the Bankruptcy Code, and all other liquidation,
conservatorship, bankruptcy, assignment for the benefit of creditors,
moratorium, rearrangement, receivership, insolvency, reorganization or similar
debtor relief laws of the United States of America or other applicable
jurisdictions from time to time in effect.

 

“Default” means an event, act, or occurrence which, with the giving of notice or
the passage of time, would become an Event of Default.

 

“Default Margin” means, automatically, after the occurrence of an Event of
Default, 2.0% per annum, accruing in each case, from the date of such Event of
Default until the date such Event of Default is cured or waived.

 

 - 15 - 

 

 

“Defaulting Lender” means any Lender that (a) has failed to (i) fund all or any
portion of its Loans within two (2) Business Days of the date such Loans were
required to be funded hereunder unless such Lender notifies the Agents and the
Borrower in writing that such failure is the result of such Lender’s good faith
determination that one or more conditions precedent to funding (each of which
conditions precedent, together with any applicable default, shall be
specifically identified in such writing) has not been satisfied, or (ii) pay to
the Agents or any other Lender any other amount required to be paid by it
hereunder within two (2) Business Days of the date when due, (b) has notified
the Borrower or the Agents in writing that it does not intend to comply with its
funding obligations hereunder, or has, subject to Section 11.12, made a public
statement to that effect (unless such writing or public statement relates to
such Lender’s obligation to fund a Loan hereunder and states that such position
is based on such Lender’s good faith determination that a condition precedent to
funding (which condition precedent, together with any applicable default, shall
be specifically identified in such writing or public statement) cannot be
satisfied), (c) has failed, within three (3) Business Days after written request
by the Agents or the Borrower, to confirm in writing to the Agents and the
Borrower that it will comply with its prospective funding obligations hereunder
(provided that such Lender shall cease to be a Defaulting Lender pursuant to
this clause (c) upon receipt of such written confirmation by the Agents and the
Borrower), or (d) has, or has a direct or indirect parent company that has,
(i) become the subject of a proceeding under any Debtor Relief Law, or (ii) had
appointed for it a receiver, custodian, conservator, trustee, administrator,
assignee for the benefit of creditors or similar Person charged with
reorganization or liquidation of its business or assets, including the Federal
Deposit Insurance Corporation or any other state or federal regulatory authority
acting in such a capacity; provided that a Lender shall not be a Defaulting
Lender solely by virtue of the ownership or acquisition of any equity interest
in that Lender or any direct or indirect parent company thereof by a
Governmental Authority so long as such ownership interest does not result in or
provide such Lender with immunity from the jurisdiction of courts within the
United States or from the enforcement of judgments or writs of attachment on its
assets or permit such Lender (or such Governmental Authority) to reject,
repudiate, disavow or disaffirm any contracts or agreements made with such
Lender. Any determination by the Required Agents that a Lender is a Defaulting
Lender under any one or more of clauses (a) through (d) above shall be
conclusive and binding absent manifest error, and such Lender shall be deemed to
be a Defaulting Lender upon delivery of written notice of such determination to
the Borrower and each Lender; provided that either Agent can declare the other
Agent to be a Defaulting Lender under any one or more of clauses (a) through (d)
above.

 

“Defaulting Lender Rate” means the Federal Funds Rate.

 

“Deposit Account” means any “deposit account” (as that term is defined in the
UCC).

 

“Designated Account” means account number              of the Borrower
maintained with Wells Fargo, or such other deposit account of the Borrower
(located within the United States) designated, in writing, from time to time, by
the Borrower to the Agents.

 

“Determined Valuation” has the meaning set forth in Section 11.5.

 

“Distribution” has the meaning set forth in Section 6.4.

 

“Dollars” or “$” means United States dollars.

 

“Eligible Assignee” means any Person that meets the requirements to be an
assignee under Sections 9.1(b)(iii), (v) and (vi) (subject to such consents, if
any, as may be required under Section 9.1(b)(iii)); provided, however, that
“Eligible Assignee” shall not include (a) any natural Person or (b) any
Defaulting Lender, its parent, any of its Subsidiaries or any Person who, upon
becoming a Lender hereunder, would constitute a Defaulting Lender or a
Subsidiary thereof.

 

“Environmental Law” means any federal, state, provincial, foreign or local
statute, law, rule, regulation, ordinance, code, binding and enforceable
guideline, binding and enforceable written policy, or rule of common law now or
hereafter in effect and in each case as amended, or any legally binding judicial
or administrative interpretation thereof, including any judicial or
administrative order, consent decree or judgment, in each case, to the extent
applicable to Borrower or any of its Subsidiaries, relating to the environment,
the effect of the environment on employee health, or Hazardous Materials, in
each case as amended from time to time.

 

 - 16 - 

 

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time, the regulations promulgated thereunder and any successor
thereto.

 

“ERISA Affiliate” means any trade or business (whether or not incorporated)
that, together with any Loan Party, is treated as a single employer under
Section 414(b) or (c) of the Code, or solely for purposes of Section 302 or 303
of ERISA or Section 412 or 430 of the Code, is treated as a single employer
under Section 414 of the Code. Any former ERISA Affiliate of the Loan Parties
shall continue to be considered an ERISA Affiliate of the Loan Parties within
the meaning of this definition with respect to the period such entity was an
ERISA Affiliate of any Loan Party and with respect to liabilities arising after
such period for which any Loan Party could be liable under the Code or ERISA.

 

“ERISA Event” means (a) a “reportable event” within the meaning of Section 4043
of ERISA and the regulations issued thereunder with respect to any Single
Employer Plan (excluding those for which the provision for thirty (30) day
notice to the PBGC has been waived by regulation in effect on the date hereof);
(b) the failure to meet all applicable requirements of the Pension Funding Rules
with respect to any Single Employer Plan, whether or not waived; (c) the filing
of an application for a waiver of the minimum funding standards under the
Pension Funding Rules with respect to any Single Employer Plan; (d) the
termination of any Single Employer Plan or the withdrawal or partial withdrawal
of any Loan Party from any Single Employer Plan or Multiemployer Plan; (e) a
determination that any Single Employer Plan is, or is expected to be, in “at
risk” status (as defined in Section 430 of the Code or Section 303 of ERISA);
(f) a determination that any Multiemployer Plan is, or is expected to be, in
“critical” or “endangered” status under Section 432 of the Code or Section 305
of ERISA; (g) the receipt by any Loan Party or any of their respective ERISA
Affiliates from the PBGC or a plan administrator of any notice relating to an
intention to terminate any Single Employer Plan or to appoint a trustee to
administer any Single Employer Plan; (h) the adoption of any amendment to a
Single Employer Plan that would require the provision of security pursuant to
Section 436(f) of the Code; (i) the receipt by any Loan Party or any of their
respective ERISA Affiliates of any notice, or the receipt by any Multiemployer
Plan from any Loan Party or any of their respective ERISA Affiliates of any
notice, concerning the imposition of Withdrawal Liability or a determination
that a Multiemployer Plan is, or is expected to be, insolvent, within the
meaning of Title IV of ERISA; (j) the failure by any Loan Party or any of their
respective ERISA Affiliates to make a required contribution to a Multiemployer
Plan; (k) the occurrence of a nonexempt prohibited transaction (within the
meaning of Section 4975 of the Code or Section 406 of ERISA) which could
reasonably be expected to result in material liability to any Loan Party; (1)
the receipt from the IRS of notice of disqualification of any Plan intended to
qualify under Section 401(a) of the Code, or the disqualification of any trust
forming part of any Plan intended to qualify for exemption from taxation under
Section 501(a) of the Code; (m) the imposition of a lien pursuant to Section
430(k) of the Code or Section 303(k) of ERISA or a violation of Section 436 of
the Code with respect to any Single Employer Plan; (n) the assertion of a
material claim (other than routine claims for benefits) against any Plan other
than a Multiemployer Plan or the assets thereof, or against any Loan Party or
any of their respective ERISA Affiliates in connection with any Plan; or (o) the
occurrence of an act or omission which could give rise to the imposition on any
Loan Party or any of their respective ERISA Affiliates of any fine, penalty, tax
or related charge under Chapter 43 of the Code or under Section 409, Section
502(c), (i) or (l), or Section 4071 of ERISA in respect of any Plan.

 

 - 17 - 

 

 

“Event of Default” has the meaning set forth in Article VII of this Agreement.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended or
supplemented from time to time, and any successor statute, and all of the rules
and regulations issued or promulgated in connection therewith.

 

“Excluded Assets” has the meaning as set forth in the Security Agreement.

 

“Excluded Information” means any non-public information with respect to the
Borrower or its Subsidiaries or any of their respective securities to the extent
such information could have a material effect upon, or otherwise be material to,
an assigning Lender’s decision to assign Initial Term Loans or a purchasing
Lender’s decision to purchase Initial Term Loans.

 

“Excluded Taxes” means any of the following Taxes imposed on or with respect to
a Recipient or required to be withheld or deducted from a payment to a
Recipient, (a) Taxes imposed on or measured by net income (however denominated),
franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result
of such Recipient being organized under the laws of, or having its principal
office or, in the case of any Lender, its applicable lending office located in,
the jurisdiction imposing such Tax (or any political subdivision thereof) or
(ii) that are Other Connection Taxes, (b) U.S. federal withholding Taxes imposed
on amounts payable to or for the account of such Recipient with respect to an
applicable interest in a Loan or Commitment pursuant to a law in effect on the
date on which (i) such Recipient acquires such interest in the Loan or
Commitment (other than pursuant to an assignment request by the Borrower under
Section 11.2) or (ii) such Recipient changes its lending office, except in each
case to the extent that, pursuant to Section 10.11, amounts with respect to such
Taxes were payable either to such Recipient’s assignor immediately before such
Recipient became a party hereto or to such Recipient immediately before it
changed its lending office, (c) Taxes attributable to such Recipient’s failure
to comply with Section 10.11(b), (c) or (g) and (d) any U.S. federal withholding
Taxes imposed under FATCA.

 

“Executive Order No. 13224” means the Executive Order No. 13224 on Terrorist
Financing, effective September 24, 2001, as the same as been, or shall hereafter
be, renewed, extended, amended or replaced.

 

“Extraordinary Restricted Payments” means (i) the purchase, redemption, or
retirement for value by the Borrower of any of its Securities or the making of
special distributions by the Borrower of capital to its stockholders not
otherwise in the ordinary course of business (specifically excluding any
dividends or distributions by the Borrower necessary for it to maintain its
status as a REIT) or (ii) voluntary repurchases or prepayments of unsecured Debt
(other than in respect of scheduled maturities, principal amortization or in
connection with the prevention or cure of a default thereunder).

 

 - 18 - 

 

 

“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this
Agreement (or any amended or successor version that is substantively comparable
and not materially more onerous to comply with), any current or future
regulations or official interpretations thereof, any agreements entered into
pursuant to Section 1471(b)(1) of the Code, any intergovernmental agreement
entered into in connection with the implementation of such Sections of the Code
and any fiscal or regulatory legislation, rules or practices adopted pursuant to
such intergovernmental agreement.

 

“Federal Funds Rate” means, for any day, the rate per annum (rounded upwards, if
necessary, to the next 1/100th of 1%) equal to the weighted average of the rates
on overnight Federal funds transactions with member banks of the Federal Reserve
System, as published by the Federal Reserve Bank of New York on the next
succeeding Business Day or if such rate is not so published for any Business
Day, the Federal Funds Rate for such day shall be the average rounded upwards,
if necessary, to the next 1/100th of 1% of the quotations for such day on such
transactions received by the Administrative Agent from three major banks of
recognized standing selected by the Administrative Agent.

 

“Federal Reserve Board” means the Board of Governors of the Federal Reserve
System or any successor thereto.

 

“Fee Side Letter” means that certain Fee Side Letter among the Borrower and the
Lender Assignees.

 

“Fundamental Change” has the meaning set forth in Section 6.5.

 

“Funding Date” means any date on which a Loan is made by the Lenders.

 

“Funding Losses” has the meaning set forth in Section 2.5(b)(ii).

 

“GAAP” means generally accepted accounting principles in the United States of
America in effect from time to time.

 

“Governing Documents” means, with respect to any Person, the certificate or
articles of incorporation or formation, by-laws, limited liability company
agreement or other organizational documents of such Person.

 

“Governmental Authority” means the government of the United States of America or
any other nation, or any political subdivision thereof, whether state or local,
and any agency, authority, instrumentality, regulatory body, court, central bank
or other entity exercising executive, legislative, judicial, taxing, regulatory
or administrative powers or functions of or pertaining to government, including
any supranational bodies such as the European Union or the European Central
Bank.

 

“Grantor” has the meaning ascribed thereto in the Security Agreement.

 

“Guarantors” has the meaning set forth in the preamble hereto (and each
individually, a “Guarantor”).

 

“Guaranty” means the Guarantee set forth in Article XII.

 

 - 19 - 

 

 

“Hazardous Materials” means (a) substances (whether solid, liquid or gas) that
are defined or listed in, or otherwise classified pursuant to, any applicable
laws or regulations as “hazardous substances,” “hazardous materials,” “hazardous
wastes,” “toxic substances,” or any other formulation intended to define, list,
or classify substances by reason of deleterious properties such as ignitability,
corrosivity, reactivity, carcinogenicity, toxicity, or “EP toxicity”, (b) oil,
petroleum, or petroleum derived substances, natural gas, natural gas liquids,
synthetic gas, drilling fluids, produced waters, and other wastes associated
with the exploration, development, or production of crude oil, natural gas, or
geothermal resources, (c) any flammable substances or explosives or any
radioactive materials, and (d) asbestos in any form, toxic mold, mycotoxins,
microbial matter, polychlorinated biphenyls or electrical equipment that
contains any oil or dielectric fluid containing levels of polychlorinated
biphenyls in excess of 50 parts per million.

 

“Highest Lawful Rate” means the maximum non-usurious interest rate, as in effect
from time to time, that may be charged, contracted for, reserved, received, or
collected by a Lender in connection with this Agreement or the other Loan
Documents.

 

“Immaterial Subsidiary” means, at any time, any Subsidiary with a Tangible Net
Worth on the last day of the most recently ended Test Period of $2,500,000 or
less; provided that, at any time, the aggregate Tangible Net Worth attributable
to all Immaterial Subsidiaries shall not exceed $5,000,000.

 

“Incremental Amendment” has the meaning set forth in Section 2.15(f)(i).

 

“Incremental Facility Closing Date” has the meaning set forth in Section
2.15(d).

 

“Incremental Lender” has the meaning set forth in Section 2.15(b).

 

“Incremental Term Commitments” has the meaning set forth in Section 2.15(a).

 

“Incremental Term Loan” has the meaning set forth in Section 2.15(c).

 

“Incremental Term Loan Request” has the meaning set forth in Section 2.15(a).

 

“Indemnified Liabilities” has the meaning set forth in Section 8.2.

 

“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or
with respect to any payment made by or on account of any obligation of the
Borrower under any Loan Document and (b) to the extent not otherwise described
in (a), Other Taxes.

 

“Indemnitee” has the meaning set forth in Section 8.2.

 

“Information” has the meaning set forth in Section 11.10.

 

“Initial Dispute Notice” has the meaning as set forth in Section 11.5.

 

“Initial Lender” means Jefferies Leveraged Credit Products, LLC.

 

 - 20 - 

 

 

“Initial MSRs” means the mortgage servicing rights sub-serviced by New Penn
Financial, LLC d/b/a Shellpoint Mortgage Servicing relating to residential
mortgage loans included in one of the following Securitization Transactions: (i)
CSMC Trust 2014-OAK1, Mortgage Pass-Through Certificates, Series 2014-OAK1, (ii)
J.P. Morgan Mortgage Trust 2014-OAK4, Mortgage Pass-Through Certificates, Series
2014-OAK4, (iii) Oaks Mortgage Trust Series 2015-1, Mortgage Pass-Through
Certificates, Series 2015-1 and (iv) Oaks Mortgage Trust Series 2015-2, Mortgage
Pass-Through Certificates, Series 2015-2.

 

“Initial Term Loan” has the meaning set forth in Section 2.1(a)(i).

 

“Initial Valuation” has the meaning as set forth in Section 11.5.

 

“Initial Valuation Agent” means, with respect to any Borrowing Base Eligible
Asset, the initial appraiser or valuation agent who established the fair market
value of such asset at the origination of such Borrowing Base Eligible Asset, or
such other broker or valuation Agent reasonably acceptable to the Required
Lenders in consultation with the Borrower; provided that (i) with respect to
valuations of Mortgage Assets, such entity shall be an appraiser who is a
licensed member of the Appraisal Institute who prepares appraisals in the state
where the Mortgage Asset is located and (ii) such entity must be active in
establishing a fair market value of assets substantially similar to the
applicable Borrowing Base Eligible Asset.

 

“Insolvency Proceeding” means any proceeding commenced by or against any Person
under any provision of the Bankruptcy Code or under any other state or federal
bankruptcy or insolvency law, assignments for the benefit of creditors, formal
or informal moratoria, compositions, extensions generally with creditors, or
proceedings seeking reorganization, arrangement, or other similar relief.

 

“Interest Coverage Ratio” means, with respect to the Borrower and as of any date
of determination, a ratio in which:

 

(a)      the numerator is the Adjusted EBITDA for the twelve months preceding
the most recently ended Test Period; and

 

(b)      the denominator is an amount equal to the interest expense on all of
the Borrower’s Debt (other than non-recourse Debt) for the twelve months
preceding the most recently ended Test Period (but exclusive of any interest
expense on any preferred equity of the Borrower).

 

“Interest Payment Date” means the last day of each Interest Period applicable to
any Loan and the final Maturity Date of such Loan, as applicable.

 

“Interest Period” means, with respect to any Loan, the period commencing on the
twenty-second (22nd) day of each month (or with respect to the initial Interest
Period for such Loan, the date on which the Loan is made) and ending on the date
which is the twenty-second (22nd) day of the following month.  Whenever the last
day of any Interest Period would otherwise occur on a day other than a Business
Day, the last day of such Interest Period shall be extended to occur on the next
succeeding Business Day, provided that if such extension would cause the last
day of such Interest Period to occur in the next following calendar month, the
last day of such Interest Period shall occur on the next preceding Business Day,
and any Interest Period which begins on the last Business Day of a calendar
month (or on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on the last
Business Day of the calendar month in which it would have ended if there were a
numerically corresponding day in such calendar month.

 

 - 21 - 

 

 

“Interest Rate” means (i) during any Interest Period prior to the Anticipated
Repayment Date, 7.25% per annum plus any Default Margin applicable during such
Interest Period, (ii) for the first four Interest Periods following the
Anticipated Repayment Date, 7.50% per annum plus any Default Margin applicable
during such Interest Period, (iii) for the fifth through eighth Interest Periods
following the Anticipated Repayment Date, 7.875% per annum plus any Default
Margin applicable during such Interest Period and (iv) for each Interest Period
thereafter, 8.375% per annum plus any Default Margin applicable during such
Interest Period.

 

“Investment” means, as applied to any Person, any direct or indirect purchase or
other acquisition by that Person of, or beneficial interest in, stock,
instruments, bonds, debentures or other securities of any other Person, or any
direct or indirect loan, advance, or capital contribution by such Person to any
other Person, including all indebtedness and accounts receivable due from that
other Person that did not arise from sales or the rendition of services to that
other Person in the ordinary and usual course of such Person’s business, and
deposit accounts (including certificates of deposit).

 

“IRS” means the United States Internal Revenue Service.

 

“Legal Expenses Cap” has the meaning set forth in Section 8.1 of this Agreement.

 

“Lender” means each lender that (a) has a Term Loan Commitment or is the holder
of an Initial Term Loan, or (b) has an Incremental Term Commitment or is the
holder of an Incremental Term Loan.

 

“Lender Assignees” means each of the entities managed or advised by J.P. Morgan
Investment Management Inc. that are Lenders under this Agreement.

 

“Lender Group” means, individually and collectively, the Lenders and the Agents.

 

“Lender Group Expenses” has the meaning given in Section 8.1.

 

“Lender-Related Person” means, with respect to any Lender, such Lender, together
with such Lender’s Affiliates, officers, directors, employees, attorneys, and
agents.

 

“Lien” means any lien, hypothecation, mortgage, pledge, assignment (including
any assignment of rights to receive payments of money or any easement,
right-of-way, zoning restriction and similar encumbrance on real property) for
security, security interest, charge and encumbrance of any kind (including any
conditional sale or other title retention agreement, any lease in the nature
thereof, and any agreement to give any security interest).

 

“Loan Account” has the meaning set forth in Section 2.10.

 

 - 22 - 

 

 

“Loan Documents” means this Agreement, the Security Agreement, any Notes, the
Agent Fee Letter, the Negative Pledge Agreement, the Borrower DACA, the Mezz
DACA, any other deposit account control agreements and any and all other
documents, agreements, or instruments that have been or are entered into by the
Borrower or Guarantor, on the one hand, and the Agents, on the other hand, in
connection with the transactions contemplated by this Agreement.

 

“Loan Party” means the Borrower or Guarantor, and “Loan Parties” means,
collectively, jointly and severally, the Borrower and the Guarantor.

 

“Loans” has the meaning set forth in Section 2.1(b)(i).

 

“Lockout Period” means the period beginning on the Closing Date and ending on
(and including) the one-year anniversary of the Closing Date.

 

“Margin Securities” means “margin stock” as that term is defined in Regulation U
of the Federal Reserve Board.

 

“Material Adverse Effect” means a material adverse effect on and/or material
adverse developments with respect to (a) the business, operations, properties,
assets or financial condition of the Borrower and its Subsidiaries taken as a
whole; (b) the ability of the Loan Parties, taken as a whole, to fully and
timely perform their Obligations or (c) the validity, binding effect or
enforceability against any Loan Party of this Agreement or any other Loan
Document to which it is a party.

 

“Material Agreements” means (a) the Loan Documents and (b) any agreements,
documents, contracts, indentures and instruments pursuant to which a default,
breach or termination thereof could reasonably be expected to result in a
Material Adverse Effect.

 

“Material Modification” means an amendment, waiver, forbearance or other
modification to or with respect to any (a) Borrowing Base Eligible Asset
(including its related Securitization Transaction) or (b) Borrowing Base
Subsidiary (or any associated Mortgage Asset), as applicable, that:

 

(i)forgives, reduces, waives or forebears from collection one or more payments
of principal or interest, or permits any interest payment due in cash to be
deferred or capitalized and added to the principal amount of such Borrowing Base
Eligible Asset or Mortgage Asset, as applicable (other than as permitted
pursuant to the applicable underlying instrument); provided, however, that any
interest payment waiver, deferral, or capitalization which is structured and
permitted in accordance with the initial closing of any loan transaction shall
not be considered a Material Modification.

 

(ii)contractually or structurally subordinates such Borrowing Base Eligible
Asset or Mortgage Asset, as applicable (other than pursuant to subordination
required under the related documents for such Borrowing Base Eligible Asset or
Mortgage Asset, as applicable) by operation of a priority of payments, turnover
provisions, consents to the transfer or encumbrance of (or waivers or forbears
from exercising rights under any provision restricting transfer or encumbrance
of any such Borrowing Base Eligible Asset or Mortgage Asset), as applicable, or
to a transfer or encumbrance of assets in order to limit recourse to the related
obligor or the granting of liens (other than permitted liens) on any of the
collateral securing such Borrowing Base Eligible Asset or Mortgage Asset, as
applicable, in a manner that materially and adversely affects the value of such
Borrowing Base Eligible Asset or Mortgage Asset, as applicable;

 

 - 23 - 

 

 

(iii)substitutes, alters or releases the collateral securing such Borrowing Base
Eligible Asset or Mortgage Asset, as applicable (other than as permitted
pursuant to the applicable underlying instrument), and each such substitution,
alteration or release, as determined in the sole discretion of the Required
Agents, materially and adversely affects the value of such Borrowing Base
Eligible Asset or Mortgage Asset, as applicable;

 

(iv)delays, postpones or extends (A) the maturity date (after giving effect to
any contractual rights of extension) for such Borrowing Base Eligible Asset or
Mortgage Asset, as applicable or (B) the required scheduled payments in any way
that, individually or in the aggregate, increases the weighted average life of
such Borrowing Base Eligible Asset or Mortgage Asset, as applicable, by 0.50
years or more;

 

(v)modifications of, waivers of, or forbearances from exercising rights with
respect to defaults, events of defaults, grace periods, cure periods, or any
financial covenants contained in any of the documents governing such Borrowing
Base Eligible Asset or Mortgage Asset to the extent such modification, waiver or
forbearance materially and adversely affects the value of such Borrowing Base
Eligible Asset or Mortgage Asset, in each case, as a whole, as applicable;

 

(vi)except for any monetary default arising from the occurrence of a maturity
date that is permitted to be delayed, postponed, or extended pursuant to clause
(iv) above, any waiver of or forbearance from exercising rights with respect to
a monetary default involving an amount due under any of the collateral documents
to the extent such waiver or forbearance materially and adversely affects the
value of such applicable Borrowing Base Eligible Asset or Mortgage Asset, in
each case, as a whole; or

 

(vii)amends, waives, forbears, supplements or otherwise modifies (A) the meaning
of “Net Operating Income” or any respective comparable definitions in the
underlying loan documents for such Borrowing Base Eligible Asset or Mortgage
Asset, as applicable or (B) any term or provision of such underlying loan
documents referenced in or utilized in the calculation of “Net Operating Income”
or any respective comparable definitions for such Borrowing Base Eligible Asset
or Mortgage Asset, as applicable, in either case in a manner that is materially
adverse to the Lenders.

 

“Maturity Date” has the meaning set forth in Section 3.3(a).

 

 - 24 - 

 

 

“Mezz DACA” means any deposit account control agreement to be entered into by
and among any Loan Party other than the Borrower and the Collateral Agent.

 

“Mezzanine Loan” means a whole loan (or interest therein) subordinate to a
senior loan that is secured by one or more direct or indirect ownership
interests in a Person owning, operating or controlling, directly or indirectly,
one or more multi-family or commercial real estate properties that are either
fully constructed or undergoing full or partial construction or renovation.

 

“Mortgage Assets” means any Borrowing Base Eligible Asset that is a (a) Senior
Commercial Real Estate Loan, (b) Senior Commercial Real Estate Construction
Loan, (c) Subordinated Commercial Real Estate Loan, (d) Preferred Equity
Investment or (e) any restricted cash held in a Securitization Transaction.

 

“MSR” means current and future agency commercial mortgage servicing rights held
by the Borrower and its Subsidiaries or the Initial MSRs.

 

“MSR Valuation Agent” means an independent third party valuation agent who is
active in establishing a fair market value of mortgage servicing rights, which
shall initially be MountainView Financial Solutions, LLC.

 

“Multiemployer Plan” means a Plan that is a “multiemployer plan” as defined in
Section 3(37) or Section 4001(a)(3) of ERISA to which any Loan Party or ERISA
Affiliate is obligated to make contributions, or during the preceding five (5)
plan years, has made or been obligated to make contributions.

 

“Negative Pledge Agreement” means that certain Negative Pledge Agreement, dated
contemporaneously herewith, among the Borrower, Hunt Commercial Mortgage Trust,
a Maryland real estate investment trust (“HCMT”), Hunt CRE 2017-FL1 Preferred,
LLC, a Delaware limited liability company (“Hunt Preferred 2017”), Hunt CRE
2018-FL2 Preferred, LLC, a Delaware limited liability company (“Hunt Preferred
2018”), Hunt CRE 2017-FL1 Seller, LLC, a Delaware limited liability company
(“Hunt Seller 2017”) Hunt CRE 2018-FL2 Seller, LLC, a Delaware limited liability
company (“Hunt Seller 2018”) and the Collateral Agent.

 

“Negative Pledgor Subsidiaries” means HCMT, Hunt Preferred 2017, Hunt Preferred
2018, Hunt Seller 2017 and Hunt Seller 2018.

 

“Non-Consenting Lender” has the meaning set forth in Section 11.2.

 

“Notes” means any promissory note requested by a Lender evidencing a Loan made
under this Agreement.

 

 - 25 - 

 

 

 

“Obligations” means all loans (including the Loans), debts, principal, interest
(including any interest that accrues after the commencement of an Insolvency
Proceeding, regardless of whether allowed or allowable in whole or in part as a
claim in any such Insolvency Proceeding), premiums, liabilities (including all
amounts charged to the Borrower’s Loan Account pursuant hereto), obligations
(including indemnification obligations), fees, charges, costs, expenses
(including Lender Group Expenses) (including any portion thereof that accrues
after the commencement of an Insolvency Proceeding, whether or not allowed or
allowable in whole or in part as a claim in any such Insolvency Proceeding),
lease payments, guaranties, covenants, and duties of any kind and description
incurred and outstanding by the Borrower to the Lender Group pursuant to or
evidenced by the Loan Documents and irrespective of whether for the payment of
money, whether direct or indirect, absolute or contingent, due or to become due,
now existing or hereafter arising, and including all interest not paid when due
and all expenses that the Borrower is required to pay or reimburse by the Loan
Documents, by law or otherwise. Any reference in this Agreement or in the Loan
Documents to the Obligations shall include all extensions, modifications,
renewals, or alterations thereof, both prior and subsequent to any Insolvency
Proceeding.

 

“OFAC” means the Office of Foreign Assets Control of the U.S. Department of the
Treasury.

 

“OID” means original issue discount.

 

“Other Connection Taxes” means, with respect to any Recipient, Taxes imposed as
a result of a present or former connection between such Recipient and the
jurisdiction imposing such Tax (other than connections arising solely from such
Recipient having executed, delivered, become a party to, performed its
obligations under, received payments under, received or perfected a security
interest under, engaged in any other transaction pursuant to or enforced any
Loan Document, or sold or assigned an interest in any Loan or Loan Document).

 

“Other Taxes” means all present or future stamp, court or documentary,
intangible, recording, filing or similar Taxes that arise from any payment made
under, from the execution, delivery, performance, enforcement or registration
of, from the receipt or perfection of a security interest under, or otherwise
with respect to, any Loan Document, except any such Taxes that are Other
Connection Taxes imposed with respect to an assignment (other than an assignment
made pursuant to Section 11.2).

 

“Participant” has the meaning set forth in Section 9.1(d).

 

“Participant Register” has the meaning set forth in Section 9.1(d).

 

“PATRIOT Act” means the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act (Title III of
Pub. L. 107-56 (signed into law October 26, 2001)), as the same has been, or
shall hereafter be, renewed, extended, amended or replaced.

 

“Payment Date Statement” means the payment date statement to be provided by the
Administrative Agent to the Lenders pursuant to Section 10.1, substantially in
the form of Exhibit C-1 hereto.

 

“Payment Default” means an Event of Default described in Section 7.1(a) hereof.

 

“PBGC” means the Pension Benefit Guaranty Corporation established pursuant to
Subtitle A of Title IV of ERISA (or any successor).

 

 - 26 - 

 

 

“Pension Act” means the Pension Protection Act of 2006.

 

“Pension Funding Rules” means the rules of the Code and ERISA regarding minimum
funding standards and minimum required contributions (including any installment
payment thereof) to a Single Employer Plan or Multiemployer Plan and set forth
in, with respect to plan years ending prior to the effective date of the Pension
Act, Section 412 of the Code and Section 302 of ERISA, each as in effect prior
to the Pension Act and, thereafter, Sections 412, 430, 431 and 436 of the Code
and Sections 302,303, 304 and 305 of ERISA.

 

“Permitted Collateral Liens” means: (a) Liens for taxes, assessments, or
governmental charges or claims the payment of which is not, at such time,
required by Section 5.5 hereof, (b) any attachment or judgment Lien and Liens
incurred to secure any surety bonds, appeal bonds, supersedeas bonds, or other
instruments serving a similar purpose in connection with the appeal of any such
judgment, in each case, so long as such judgments do not constitute an Event of
Default under Section 7.1(h) of this Agreement, (c) banker’s Liens in the nature
of rights of setoff arising in the ordinary course of business of the Borrower
or any of its Subsidiaries, (d) Liens granted by the Borrower or any of its
Subsidiaries to the Collateral Agent, for the benefit of the Secured Parties, in
order to secure its Obligations under this Agreement and the other Loan
Documents to which it is a party, (e) Liens and deposits in connection with
workers’ compensation, unemployment insurance, social security and other
legislation affecting the Assets, (f) Liens arising by operation of law in favor
of carriers, warehousemen, landlords, mechanics, materialmen, laborers or
employees for sums that are not yet delinquent or are being diligently contested
in good faith, (g) easements, rights of way, zoning restrictions and similar
encumbrances on real property and minor irregularities in the title thereto that
do not (i) secure obligations for the payment of money or (ii) materially impair
the value of such property or its use by any Loan Party or any of its
Subsidiaries in the normal conduct of such Person’s business, (h) leases or
subleases granted to other Persons not materially interfering with the conduct
of the business of the Borrower or any of its Subsidiaries, (i) Liens in
connection with the financing of insurance premiums permitted by Section 6.1(1)
provided that such Liens are limited to the applicable unearned insurance
premiums, (j) Liens in favor of any escrow agent solely on and in respect of any
cash earnest money deposits made by the Borrower or any of its Subsidiaries
incurred in the ordinary course of business and in connection with any letter of
intent or purchase agreement (to the extent that the acquisition or disposition
with respect thereto is otherwise permitted hereunder), (k) Liens encumbering
customary initial deposits and margin deposits, and similar Liens and margin
deposits, and similar Liens attaching to commodity trading accounts and other
brokerage accounts incurred in the ordinary course of business, (1) Liens deemed
to exist as a matter of law in connection with permitted repurchase obligations
incurred in the ordinary course of business or set-off rights and (m) Liens in
favor of collecting banks arising under Section 4-210 of the UCC.

 

“Permitted Debt Certificate” has the meaning set forth in Section
10.12(a)(ii)(A).

 

“Permitted Liens” means the collective reference to the Liens permitted by
Section 6.2.

 

“Person” means and includes natural persons, corporations, partnerships, limited
liability companies, joint ventures, associations, companies, business trusts,
or other organizations, irrespective of whether they are legal entities.

 

 - 27 - 

 

 

“Plan” means any “employee benefit plan” as defined in Section 3(3) of ERISA
which is sponsored, maintained or contributed to by, or required to be
contributed to by, the Borrower or any of its ERISA Affiliates or with respect
to which the Borrower or any of its ERISA Affiliates has or could reasonably be
expected to have liability, contingent or otherwise, under ERISA.

 

“Pledged Equity Interests” has the meaning set forth in the Security Agreement.

 

“Pledged Securities” has the meaning set forth in the Security Agreement.

 

“Preferred Equity Investment” means a direct or indirect preferred equity
ownership interest in a Person owning, operating or controlling, directly or
indirectly, one or more multifamily or commercial real estate properties that
are either fully constructed or undergoing full or partial construction or
renovation.

 

“Pro Rata Share” means, as of any date of determination, with respect to a
Lender’s obligation to make Loans and receive payments of principal, interest,
fees, costs, and expenses or other amounts with respect thereto, the percentage
obtained by dividing (y) the aggregate outstanding principal amount of such
Lender’s Loans by (z) the aggregate outstanding principal amount of all Loans;
provided, that if at the time of such determination, all Loans have been
paid-in-full, then such determination shall be based on the outstanding
principal amount of the Loans as of the next preceding Business Day prior to the
last date on which any Loans were outstanding.

 

“Purchase Money Obligation” shall mean, for any Person, the obligations of such
Person in respect of Debt (including Capitalized Lease Obligations) incurred for
the purpose of financing all or any part of the purchase price of any fixed or
capital assets or the cost of installation, construction or improvement of any
fixed or capital assets; provided, however, that (i) such Debt is incurred
within ninety (90) days after such acquisition, installation, construction or
improvement of such fixed or capital assets by such Person and (ii) the amount
of such Debt does not exceed the lesser of 100% of the fair market value of such
fixed or capital asset or the cost of the acquisition, installation,
construction or improvement thereof, as the case may be.

 

“Proceeds” shall mean all “proceeds” as such term is defined in Section
9-102(a)(64) of the UCC and, in any event, shall include, without limitation,
all dividends or other income from the Pledged Securities, collections thereon
and distributions or payments with respect thereto.

 

“Recipient” means any Agent and any Lender, as applicable.

 

“Register” has the meaning set forth in Section 9.1(c).

 

“Regulation T” means Regulation T of the Board of Governors as in effect from
time to time.

 

“Regulation U” means Regulation U of the Board of Governors as in effect from
time to time.

 

“Regulation X” means Regulation X of the Board of Governors as in effect from
time to time.

 

 - 28 - 

 

 

“REIT” has the meaning set forth in Section 6.4.

 

“Removal Event” shall have occurred in respect of a Person then serving as an
Agent under this Agreement if a court of competent jurisdiction shall have
determined in a final judgment that such Person, or any of its officers,
directors, employees or agents, or other persons under its direction or control,
shall have engaged in any actions or omissions that constitute gross negligence,
willful misconduct or bad faith in connection with the performance of its
obligations under this Agreement as Agent and such actions or omissions have a
material adverse effect on the Lenders or if an Insolvency Proceeding has
commenced with respect to an Agent.

 

“Report” has the meaning set forth in Section 10.17(a).

 

“Request for Borrowing” means an irrevocable written notice from any of the
individuals identified on Exhibit R-1 attached hereto (or, in certain cases, two
of such individuals, all as set forth in further detail in Exhibit R-1 attached
hereto) to the Administrative Agent of the Borrower’s request for a Loan, which
notice shall be substantially in the form of Exhibit R-2 attached hereto.

 

“Required Agents” either Agent acting at the direction of the Required Lenders.

 

“Required Lenders” means, at any time, (a) Lenders holding 100% of the aggregate
amount of the Loans then outstanding at any time there are two or fewer Lenders
and (b) Lenders holding more than 50% of the aggregate amount of the Loans then
outstanding at any time there are three or more Lenders; provided that, for
purposes of determining whether there are two or fewer or three or more Lenders
at any time, Affiliates of any Lender shall, collectively, be deemed to be one
Lender; provided, further, that, for so long as Lenders managed by J.P. Morgan
Investment Management Inc. (taken as a whole) hold more than 20% of the
aggregate amount of the Loans then outstanding, such Lenders shall be one of the
Required Lenders pursuant to clause (a) and (b) above.

 

“Resignation Effective Date” has the meaning set forth in Section 10.9(a).

 

“Responsible Officer” means the president, chief executive officer, chief
operating officer, chief financial officer, secretary, general counsel, vice
president, manager, treasurer or controller of a Person or such Person’s
external manager, or such other officer of such Person or external manager
designated by a Responsible Officer in a writing delivered to the Agents.

 

“Restricted Asset” has the meaning ascribed thereto in the Negative Pledge
Agreement.

 

“Sanctioned Country” means, at any time, a country, region or territory that is
subject to any country-wide or territory-wide Sanctions.

 

“Sanctioned Person” means, at any time, (a) any Person listed in any
Sanctions-related list of designated Persons maintained by OFAC, the U.S.
Department of State, the United Nations Security Council, (b) any Person
operating, organized or resident in a Sanctioned Country or (c) any Person owned
or controlled by any such Person or Persons described in the foregoing clauses
(a) or (b).

 

 - 29 - 

 

 

“Sanctions” means all economic or financial sanctions or trade embargoes
imposed, administered or enforced from time to time by (a) the U.S. government,
including those administered by OFAC or the U.S. Department of State or (b) the
United Nations Security Council.

 

“SEC” means the Securities and Exchange Commission of the United States of
America or any successor thereto.

 

“Second Valuation” has the meaning as set forth in Section 11.5.

 

“Second Valuation Agent” means any independent broker (other than the Initial
Valuation Agent) acceptable to the Borrower undertaken to determine the Second
Valuation; provided that (i) with respect to valuations of Mortgage Assets, such
entity shall be an appraiser who is a licensed member of the Appraisal Institute
who prepares appraisals in the state where the Mortgage Asset is located and
(ii) such entity must be active in establishing a fair market value of assets
substantially similar to the applicable Borrowing Base Eligible Asset.

 

“Secured Obligations” means all Obligations.

 

“Secured Parties” has the meaning set forth in the Security Agreement.

 

“Securities” means the capital stock, membership interests, partnership
interests (whether limited or general) or other securities or equity interests
of any kind of a Person, all warrants, options, convertible securities, and
other interests which may be exercised in respect of, converted into or
otherwise relate to such Person’s capital stock, membership interests,
partnership interests (whether limited or general) or other equity interests and
any other securities, including debt securities of such Person.

 

“Securitization Entity” has the meaning defined in the definition of
“Securitization Transaction.”

 

“Securitization Indebtedness” means (a) indebtedness of any Subsidiaries of the
Borrower incurred pursuant to on-balance sheet Securitization Transactions
treated as financings and (b) any indebtedness or other securities issued by a
Securitization Entity or a Subsidiary of the Borrower pursuant to a
Securitization Transaction, which, in each case, is non-recourse to the Borrower
(except for customary representations, warranties, covenants, indemnities and
other agreements made or given by the Borrower, or made or given by a Subsidiary
of the Borrower and guaranteed by the Borrower, in connection with a
Securitization Transaction).

 

“Securitization Transaction” means a public or private transfer, sale or
financing of servicing advances and/or mortgage loans, installment contracts,
other loans and any other financial asset capable of being securitized by which
the Borrower or any of its Subsidiaries directly or indirectly securitizes a
pool of specified financial assets including, without limitation, any such
transaction involving the sale of specified servicing advances or mortgage loans
(directly or through a depositor) to a special purpose entity (a “Securitization
Entity”) established for the purpose of issuing asset-backed or mortgaged-backed
or mortgage pass-through securities of any kind.

 

 - 30 - 

 

 

“Security Agreement” means that certain Pledge and Security Agreement, dated
contemporaneously herewith, among Borrower, the Guarantors, the other Grantors
from time to time party thereto and the Collateral Agent.

 

“Senior Commercial Real Estate Construction Loan” means a whole loan (or senior
or pari passu interest therein) made to finance the construction of multi-family
or commercial real estate properties and secured by a mortgage thereon, which
loan is not subordinate in right of payment to any separate loan secured by the
same property.

 

“Senior Commercial Real Estate Loan” means a whole loan (or senior or pari passu
interest therein) secured by a mortgage on multi-family or commercial real
estate properties, which loan is not subordinate in right of payment to any
separate loan secured by the same property; provided, that a Senior Commercial
Real Estate Construction Loan shall not constitute a Senior Commercial Real
Estate Loan.

 

“Single Employer Plan” means any Plan that is covered by Title W of ERISA or the
Pension Funding Rules, but which is not a Multiemployer Plan.

 

“Solvent” means, with respect to any Person, as of any date of determination,
(a) the amount of the “present fair saleable value” of the assets of such Person
will, as of such date, exceed the amount of all “liabilities of such Person,
contingent or otherwise,” as of such date, (b) the “present fair saleable value”
of the assets of such Person will, as of such date, be greater than the amount
that will be required to pay the liability of such Person on its debts as such
debts become absolute and matured, (c) such Person will not have, as of such
date, an unreasonably small amount of capital with which to conduct its
business, (d) such Person will be able to pay its debts as they mature and (e)
such Person is not insolvent within the meaning of any applicable requirements
of law. For purposes of this definition, (i) “debt” shall mean liability on a
“claim,” (ii) “claim” shall mean any (A) right to payment, whether or not such a
right is reduced to judgment, liquidated, unliquidated, fixed, contingent,
matured, unmatured, disputed, undisputed, legal, equitable, secured or unsecured
or (B) right to an equitable remedy for breach of performance if such breach
gives rise to a right to payment, whether or not such right to an equitable
remedy is reduced to judgment, fixed, contingent, matured or unmatured,
disputed, undisputed, secured or unsecured and (iii) such other quoted terms
used in this definition shall be determined in accordance with applicable
federal and state laws governing determinations of the insolvency of debtors.

 

“Specified Third Party Securitization” means any securitization transaction that
was not established or sponsored by Borrower or Borrower’s external manager or
any of their respective Affiliates.

 

“Subordinated Commercial Real Estate Loan” means (1) a whole loan (or interest
therein) secured by a mortgage on multi-family or commercial real estate
properties, which loan is subordinate in right of payment to one or more
separate loans secured by the same applicable property, (2) a subordinate
interest in a Senior Commercial Real Estate Loan (including, without limitation,
a B Note) or (3) a Mezzanine Loan; provided, that for the avoidance of doubt,
(i) a Preferred Equity Investment shall not constitute a Subordinated Commercial
Real Estate Loan and (ii) a subordinate or mezzanine interest in a commercial
real estate construction shall not be a Subordinated Commercial Real Estate
Loan.

 

 - 31 - 

 

 

“Subsidiary” means, with respect to any Person, any corporation, partnership,
association, joint venture, limited liability company or other entity
(heretofore, now or hereafter established) of which at least a majority of the
securities or other ownership interests having by the terms thereof ordinary
voting power to elect a majority of the board of directors or other persons
performing similar functions of such corporation, partnership, limited liability
company or other entity (without regard to the occurrence of any contingency) is
at the time directly or indirectly owned or controlled by such Person or one or
more Subsidiaries of such Person or by such Person and one or more Subsidiaries
of such Person, and shall include all Persons the accounts of which are
consolidated with those of such Person pursuant to GAAP; provided that no issuer
of a Specified Third Party Securitization shall be considered a “Subsidiary” of
Borrower or any of its Affiliates.

 

“Swap Agreement” means any agreement with respect to any swap, forward, future
or derivative transaction or option or similar agreement involving, or settled
by reference to, one or more rates, currencies, commodities, equity or debt
instruments or securities, or economic, financial or pricing indices or measures
of economic, financial or pricing risk or value or any similar transaction or
any combination of these transactions; provided that no phantom stock or similar
plan providing for payments only on account of services provided by current or
former directors, officers, employees or consultants of any of the Loan Parties
shall be a Swap Agreement.

 

“Tangible Net Worth” means with respect to any Person and any date, all amounts
that would be included under capital or shareholder’s equity (or any like
caption) on the balance sheet of such Person (inclusive of preferred equity,
irrespective of GAAP treatment of such preferred equity, so long as such
preferred equity does not have any mandatory redemption provisions that are
applicable until the date that is ninety-one (91) days after the Maturity Date
of the Loans), minus (a) amounts owing to that Person from any Affiliate
thereof, or from officers, employees, partners, members, directors, shareholders
or other Persons similarly affiliated with such Person or any Affiliate thereof,
(b) intangible assets, and (c) prepaid taxes and/or expenses, plus deferred
origination fees, net of deferred origination costs, all on or as of such date;
provided that “Tangible Net Worth” shall be determined without regard to the
effects of consolidation of any issuer of a Specified Third Party Securitization
on the financial statements of such Person under Accounting Standards
Codification Section 810, as amended, modified or supplemented from time to
time, or otherwise under GAAP. For sake of clarity, mortgage servicing rights
shall not be deemed to be intangible assets and shall be accounted for using
their fair market value.

 

“Taxes” means all present or future taxes, levies, imposts, duties, deductions,
withholdings (including backup withholding), assessments, fees or other charges
imposed by any Governmental Authority, including any interest, additions to tax
or penalties applicable thereto.

  

 - 32 - 

 

 

“Term Loan Commitment” means, as to any Lender, the obligation of such Lender,
if any, to make an Initial Term Loan to the Borrower hereunder in a principal
amount not to exceed the amount set forth under the heading “Term Loan
Commitment” opposite such Lender’s name on Annex A-1 or, as the case may be, in
the Assignment and Acceptance pursuant to which such Lender became a party
hereto, as the same may be changed from time to time pursuant to the terms
hereof; provided, that, with respect to the Initial Term Loan, if the Closing
Date does not occur on or prior to Term Loan Commitment Termination Date, the
Term Loan Commitment shall terminate on the Term Loan Commitment Termination
Date.

 

“Term Loan Commitment Termination Date” means March 31, 2019.

 

“Term Loan Increase” has the meaning set forth in Section 2.15(a).

 

“Term Loan Maturity Date” means (a) with respect to the Initial Term Loans, the
Maturity Date and (b) with respect to any Incremental Term Loans, the final
maturity date as specified in the applicable Incremental Amendment; provided
that, if any such day is not a Business Day, the applicable Term Loan Maturity
Date shall be the Business Day immediately succeeding such day.

 

“Test Period” means the time period from the first day of each fiscal quarter,
through and including the last day of such fiscal quarter.

 

“Third Valuation” has the meaning as set forth in Section 11.5.

 

“Third Valuation Agent” means any independent broker (other than the Initial
Valuation Agent and the Second Valuation Agent) acceptable to the Borrower and
the Required Lenders undertaken to determine the Third Valuation; provided that
(i) with respect to valuations of Mortgage Assets, such entity shall be an
appraiser who is a licensed member of the Appraisal Institute who prepares
appraisals in the state where the Mortgage Asset is located and (ii) such entity
must be active in establishing a fair market value of assets substantially
similar to the applicable Borrowing Base Eligible Asset.

 

“Total Net Leverage Ratio” means, at any date, the ratio of (a) aggregate
outstanding consolidated Debt of the Borrower and its Subsidiaries (net of any
unrestricted cash and Cash Equivalents and Warehousing Debt secured by loans
available for sale) on such date to (b) consolidated Tangible Net Worth of the
Borrower and its Subsidiaries for the most recently ended Test Period.

 

“Transactions” means collectively, the transactions to occur on or prior to the
Closing Date including the execution, delivery and performance of the Loan
Documents, the initial borrowings hereunder and the use of proceeds thereof.

 

 - 33 - 

 

 

“Treasury Constant Yield” means the arithmetic mean of the rates published as
“Treasury Constant Maturities” as of 5:00 p.m. (Eastern time), for the five (5)
Business Days preceding the date on which acceleration has been declared, or, as
applicable, the date on which a prepayment subject to a Yield Maintenance
Premium pursuant to this Agreement is made, as shown on the USD screen of
Reuters (or such other page as may replace that page on that service, or such
other page or replacement therefor on any successor service), or if such service
is not available, the Bloomberg Service (or any successor service), or if
neither Reuters nor the Bloomberg Service is available, under Section 504 in the
weekly statistical release designated H.15(519) (or any successor publication)
published by the Board of Governors of the Federal Reserve System, for “On the
Run” United States Treasury obligations with a term corresponding to the period
beginning on the date of prepayment and ending on the Yield Maintenance Date. If
no such maturity shall so exactly correspond, yields for the two most closely
corresponding published maturities shall be calculated pursuant to the foregoing
sentence and the Treasury Constant Yield shall be interpolated or extrapolated
(as applicable) from such yields on a straight-line basis (rounding, in the case
of relevant periods, to the nearest month).

 

“UCC” means the New York Uniform Commercial Code as in effect from time to time.

 

“Underwriting Guidelines” means the underwriting guidelines of the Borrower and
its Subsidiaries set forth on Exhibit U-1 hereto, with any changes thereto
approved in writing by the Required Lenders.

 

“Unencumbered Asset Ratio” means, at any date, the ratio of (a) the sum of (i)
the Assigned Value of the Borrowing Base Eligible Assets comprised of Senior
Commercial Real Estate Loans and Senior Commercial Real Estate Construction
Loans that are not encumbered by a Lien other than Permitted Liens plus (ii) the
Assigned Value of other Borrowing Base Eligible Assets that are not encumbered
by a Lien other than Permitted Liens to (b) the aggregate principal amount of
funded and outstanding Loans.

 

“Updated Valuation” has the meaning set forth in Section 11.5.

 

“Upfront Fees” shall have the meaning assigned to such term in the Fee Side
Letter.

 

“VAE” means with respect to (a) any Borrowing Base Eligible Asset or (b) in the
case of a Borrowing Base Eligible Asset that is comprised of Securities in a
Borrowing Base Subsidiary, one or more related Mortgage Assets, as applicable,
the occurrence of any of the following:

 

  (i) any payment default or any other default(s) (in each case, after giving
effect to any applicable grace, cure or notice periods in accordance with the
underlying loan documents) that, in the case of a non-payment default, could,
individually or in the aggregate, reasonably be expected to materially and
adversely affect value of such Borrowing Base Eligible Asset or Mortgage Asset
as a whole;         (ii) an insolvency event with respect to an underlying
borrower;         (iii) the loan to value percentage is greater than 90%;      
  (iv) for any Subordinated Commercial Real Estate Loan or Preferred Equity
Investment, the first lien loan to value is greater than 80%;

 

 - 34 - 

 

 

  (v) for any Mortgage Assets held by a Borrowing Base Debt Subsidiary or in a
Securitization Transaction, the aggregate outstanding principal balance of the
associated Warehousing Debt, Securitization Indebtedness or other debt exceeds:
(A) with respect to floating rate collateral, 87% of the aggregate outstanding
principal balance of all Mortgage Assets of such Borrowing Base Debt Subsidiary
or Securitization Transaction, as applicable and (B) with respect to fixed rate
collateral, 93% of the aggregate outstanding principal balance of all Mortgage
Assets of such Borrowing Base Debt Subsidiary or Securitization Transaction, as
applicable;         (vi) the occurrence of a Material Modification with respect
to such Borrowing Base Eligible Asset or Mortgage Asset, as applicable; and    
    (vii) a default (after giving effect to any applicable grace, cure or notice
periods as such periods may be extended with the approval of the applicable
counterparties to such Warehousing Debt) that occurs under any Warehousing Debt
or Securitization Indebtedness for which a Borrowing Base Debt Subsidiary is a
sponsor, issuer or borrower that results in a Material Adverse Effect on the
value of such Borrowing Base Debt Subsidiary as a whole.

 

“Valuation Agent” means, any of the Initial Valuation Agent, Second Valuation
Agent and/or the Third Valuation Agent, as the context may require.

 

“Valuation Confirmation Process” has the meaning as set forth in Section 11.5.

 

“Valuation Report” has the meaning as set forth in Section 11.5.

 

“Warehousing Debt” means any warehouse, purchase, repurchase, participation or
other similar financing facility extended by a lender or repo buyer to the
Borrower or a Subsidiary thereof to finance the funding, acquisition or
ownership of (a) Senior Commercial Real Estate Loans, (b) Senior Commercial Real
Estate Construction Loan, (c) Subordinated Commercial Real Estate Loan, (d)
Mezzanine Loans or (e) mortgage loans, mortgaged-backed or mortgage pass-through
securities or other mortgage-related assets of any kind, but only for such time
as the foregoing remain financed under such facility.

 

“Weighted Average Life to Maturity” means, when applied to any Debt at any date,
the number of years obtained by dividing: (a) the sum of the products obtained
by multiplying (i) the amount of each then remaining installment, sinking fund,
serial maturity or other required payments of principal, including payment at
final maturity, in respect thereof, by (ii) the number of years (calculated to
the nearest one-twelfth) that will elapse between such date and the making of
such payment; by (b) the then outstanding principal amount of such Debt.

 

“Withdrawal Liability” means any liability to a Multiemployer Plan as a result
of a “complete withdrawal” or “partial withdrawal” from such Multiemployer Plan,
as such terms are defined in Section 4201(b) of ERISA.

 

“Withholding Agent” means any Loan Party and any Agent.

 

“Yield Maintenance Date” means the date which is the four year anniversary of
the Closing Date.

 

 - 35 - 

 

 

“Yield Maintenance Premium” means, with respect to any Loan prepaid prior to the
Yield Maintenance Date, for the benefit of each Lender, an amount equal to the
product of:

 

(i)          a fraction whose numerator is the principal amount of the Loans so
prepaid and whose denominator is the aggregate principal amount of the Loans
outstanding before giving effect to such payment, multiplied by

 

(ii)         the excess of (A) the sum of the respective present values
(computed as of the date of prepayment) of the remaining scheduled payments
(assuming such payments are made as scheduled) of principal and interest with
respect to the portion of the Loans prepaid prior to the Yield Maintenance Date
(assuming no prepayments or acceleration of the Loans ahead of the Yield
Maintenance Date and all remaining principal amount on the Loans on the Yield
Maintenance Date is paid in a single balloon payment on the Yield Maintenance
Date), determined by discounting such payments to the date on which such
prepayment is made at a rate, when compounded monthly, is equivalent to the
Treasury Constant Yield plus 1.00% when compounded semi-annually (for the
avoidance of doubt deducting from the sum of such present values any interest
paid for the period from the date of prepayment to the next succeeding Payment
Date in the event such payment is not made on a Payment Date), over (B) the
aggregate principal amount of the Loans outstanding on such date immediately
prior to such prepayment;

 

provided that the Yield Maintenance Premium shall not be less than one percent
(1.00%) of the principal amount of the Loans so prepaid. For the avoidance of
doubt, the Yield Maintenance Premium shall be $0 for any Loans prepaid after the
Yield Maintenance Date.

 

1.2          Construction. Unless the context of this Agreement clearly requires
otherwise, references to the plural include the singular and to the singular
include the plural, the part includes the whole, the term “including” is not
limiting, and the term “or” has, except where otherwise indicated, the inclusive
meaning represented by the phrase “and/or.” References in this Agreement to a
“determination” or “designation” include estimates by the Agents (in the case of
quantitative determinations or designations), and beliefs by the Agents (in the
case of qualitative determinations or designations). The words “hereof,”
“herein,” “hereby,” “hereunder,” and similar terms in this Agreement refer to
this Agreement as a whole and not to any particular provision of this Agreement.
Article, section, subsection, clause, exhibit, and schedule references are to
this Agreement unless otherwise specified. Any reference herein to this
Agreement or any of the Loan Documents includes any and all alterations,
amendments, restatements, changes, extensions, modifications, renewals, or
supplements thereto or thereof, as applicable, made in accordance with the terms
hereof or thereof. Any reference herein or in any other Loan Document to the
satisfaction or repayment in full of the Obligations, any reference herein or in
any other Loan Document to the Obligations being “paid in full” or “repaid in
full” (except as set forth in Section 2.3(a)(v)), and any reference herein or in
any other Loan Document to the action by any Person to repay the Obligations in
full, shall mean the repayment in full in cash in Dollars of all Obligations
other than contingent indemnification Obligations as to which no claim has been
asserted or is anticipated. All payments hereunder or any other Loan Document in
respect of the Obligations shall be made in Dollars.

 

 - 36 - 

 

 

1.3          Accounting Terms; GAAP; Pro Forma Calculations. (a) Except as
otherwise expressly provided herein, all terms of an accounting or financial
nature shall be construed in accordance with GAAP, as in effect from time to
time; provided that, if the Borrower notifies Agents that the Borrower wishes to
amend any provision hereof to eliminate the effect of any change occurring after
the date hereof in GAAP or in the application thereof on the operation of such
provision (or if any Agent notifies the Borrower that the Required Lenders
request an amendment to any provision hereof for such purpose), regardless of
whether any such notice is given before or after such change in GAAP or in the
application thereof, then the Borrower’s (and the Guarantor’s, as applicable)
compliance with such provision shall be determined on the basis of GAAP as in
effect and applied immediately before such change shall have become effective
until such notice shall have been withdrawn or such provision amended in
accordance herewith.

 

Article II

AMOUNT AND TERMS OF LOANS

 

2.1          Credit Facilities. Subject to the terms and conditions of this
Agreement:

 

(a)          Each Lender agrees, severally and not jointly, to make an Initial
Term Loan (the “Initial Term Loan”) to the Borrower on the Closing Date in an
amount equal to the Term Loan Commitment of such Lender; provided, that such
Closing Date shall occur no later than the Term Loan Commitment Termination
Date.

 

(b)          The Borrower may make only one borrowing under the Term Loan
Commitment, which shall be on the Closing Date. Any amount borrowed under this
Section 2.1(a) and subsequently repaid or prepaid may not be reborrowed. Subject
to Section 2.7 and Section 2.8, all amounts owed hereunder with respect to the
Initial Term Loans shall be paid in full no later than the Maturity Date. Each
Lender’s Term Loan Commitment shall terminate immediately and without further
action on the Closing Date after giving effect to the funding of such Lender’s
Term Loan Commitment on the Closing Date.

 

2.2          [Reserved].

 

2.3          Interest Rates; Payment of Principal and Interest.

 

(a)          Borrower shall make each payment due hereunder by making, or
causing to be made in Dollars in immediately available funds, the amount thereof
available to Agent’s Account, not later than 1:00 p.m. (Eastern Time), on the
date of payment, for the account of the Lender Group. All payments received by
the Administrative Agent after 1:00 p.m. (Eastern Time), may be deemed received
on the next Business Day (in the Administrative Agent’s sole discretion) and any
applicable interest shall continue to accrue.

 

(i)          Unless the Administrative Agent receives written notice from
Borrower prior to the date on which any payment is due to the Lenders that the
Borrower will not make such payment in full in Dollars in immediately available
funds as and when required, the Administrative Agent may assume that the
Borrower has made (or will make) such payment in full to the Administrative
Agent on such date in Dollars in immediately available funds and the
Administrative Agent may (but shall not be so required), in reliance upon such
assumption, distribute to each Lender on such due date an amount equal to the
amount then due such Lender.

 

 - 37 - 

 

 

(ii)         Except as otherwise provided with respect to Defaulting Lenders,
aggregate principal and interest payments shall be apportioned among the Lenders
in accordance with their Pro Rata Share and applied thereto and payments of fees
and expenses (other than fees or expenses that are for the Administrative
Agent’s separate account, after giving effect to any agreements between the
Agents and individual Lenders) shall be apportioned ratably among the Lenders in
accordance with Section 2.17. All payments shall be remitted to the Agents and
all such payments, and all Proceeds of Collateral received by the Agents, shall
be applied as follows:

 

(A)         first, to pay any fees and Lender Group Expenses then due to the
Agents under the Loan Documents, until paid in full,

 

(B)         second, to pay any fees and Lender Group Expenses then due to the
Lenders (other than Defaulting Lenders) under the Loan Documents, on a ratable
basis, until paid in full,

 

(C)         third, ratably to pay interest due to the Lenders (other than
Defaulting Lenders) in respect of the Loans until paid in full,

 

(D)         fourth, to pay the principal of all Loans then due to the Lenders
(other than Defaulting Lenders) until paid in full,

 

(E)         fifth, to pay any other Obligations owed to Lenders (other than
Defaulting Lenders), until paid in full,

 

(F)         sixth, to pay any Obligations owed to Defaulting Lenders until paid
in full, and

 

(G)         seventh, to the Borrower (to be wired to the Designated Account) or
such other Person entitled thereto under applicable law.

 

(iii)        the Administrative Agent promptly shall distribute to each Lender,
pursuant to the applicable wire instructions received from each Lender in
writing, such funds as it may be entitled to receive.

 

(iv)        For purposes of the foregoing, “paid in full” means payment of all
amounts owing under the Loan Documents according to the terms thereof, including
loan fees, service fees, professional fees, interest (and specifically including
interest accrued after the commencement of any Insolvency Proceeding), default
interest, interest on interest, and expense reimbursements, whether or not any
of the foregoing would be or is allowed or disallowed in whole or in part in any
Insolvency Proceeding, other than contingent indemnification Obligations as to
which no claim has been asserted or is anticipated.

 

 - 38 - 

 

 

(v)         In the event of a direct conflict between the priority provisions of
this Section 2.3 and other provisions contained in any other Loan Document, it
is the intention of the parties hereto that such priority provisions in such
documents shall be read together and construed, to the fullest extent possible,
to be in concert with each other. In the event of any actual, irreconcilable
conflict that cannot be resolved as aforesaid, the terms and provisions of this
Section 2.3 shall control and govern.

 

(b)          Each Loan shall bear interest upon the unpaid principal balance
thereof, from the date advanced or continued, at a rate, per annum, equal to the
lesser of (i) the Interest Rate and (ii) the Highest Lawful Rate. Interest due
with respect to each Loan shall be due and payable, in arrears, on each Interest
Payment Date applicable to that Loan and on the Maturity Date.

 

(c)          Unless prepaid in accordance with the terms hereof, the outstanding
principal balance of all Loans, together with accrued and unpaid interest
thereon, shall be due and payable, in full, on the Maturity Date.

 

(d)          Any Lender by written notice to the Borrower (with a copy to the
Agents) may request that Loans made by it be evidenced by a promissory note. In
such event, the Borrower shall execute and deliver to such Lender a promissory
note, substantially in the form of Exhibit A-2 payable to such Lender (or, if
requested by such Lender, to such Lender and its registered assigns).
Thereafter, the Loans evidenced by such promissory note and interest thereon
shall at all times (including after assignment pursuant to Section 9.1) be
represented by one or more promissory notes in such form payable to the payee
named therein (or to such payee and its registered assigns). For the avoidance
of doubt, assignments of any Loans by Lenders (irrespective of whether
promissory notes are issued hereunder) shall be in accordance with the
provisions of Section 9.1 of this Agreement.

 

2.4          Computation of Interest and Fees; Maximum Interest Rate.

 

(a)          All computations of interest with respect to the Loans and
computations of the fees due hereunder for any period shall be calculated on the
basis of a year of 360 days for the actual number of days elapsed in such
period. Interest shall accrue from the first day of the making of a Loan (or the
date on which interest or fees or other payments are due hereunder, if
applicable) to (but not including) the date of repayment of such Loan (or the
date of the payment of interest or fees or other payments, if applicable) in
accordance with the provisions hereof.

 

(b)          Anything to the contrary contained in this Agreement
notwithstanding, the Borrower shall not be obligated to pay, and the Agents
shall not be entitled to charge, collect, receive, reserve, or take interest (it
being understood that interest shall be calculated as the aggregate of all
charges which constitute interest under applicable law that are contracted for,
charged, reserved, received, or paid) in excess of the Highest Lawful Rate.
During any period of time in which the interest rates specified herein exceed
the Highest Lawful Rate, interest shall accrue and be payable at such Highest
Lawful Rate; provided, however, that, if the interest rate otherwise applicable
hereunder declines below the Highest Lawful Rate, interest shall continue to
accrue and be payable at the Highest Lawful Rate (so long as there remains any
unpaid principal with respect to the Loans) until the interest that has been
paid hereunder equals the amount of interest that would have been paid if
interest had at all times accrued and been payable at the applicable interest
rates otherwise specified in this Agreement. For purposes of this Section 2.4,
the term “applicable law” shall mean that law in effect from time to time and
applicable to this loan transaction which lawfully permits the charging and
collection of the highest permissible, lawful, non-usurious rate of interest on
such loan transaction and this Agreement, including laws of the State of New
York and, to the extent controlling or the laws of the United States of America.

 

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2.5          Request for Borrowing.

 

(a)          Each Loan shall be made on a Business Day.

 

(b)          Each Loan that is proposed to be made after the Closing Date shall
be made upon written notice, by way of a Request for Borrowing, which Request
for Borrowing shall be irrevocable and shall be given by mail, electronic mail
(in a format bearing a copy of the signature(s) required thereon), or personal
service, and delivered to the Administrative Agent at the address provided in
Exhibit 11.3, by the Borrower giving the Administrative Agent notice at least
ten (10) Business Days before the date the Loan is to be made, and such notice
shall specify that a Loan is requested and state the amount (subject to the
provisions of this Article II).

 

(c)          If the notice provided for in clause (b) of this Section 2.5 with
respect to a Loan is received by the Administrative Agent not later than 1:00
p.m. (Eastern Time), on a Business Day, such day shall be treated as the first
Business Day of the required notice period. In any other event, such notice will
be treated as having been received immediately before 1:00 p.m. (Eastern Time)
of the next Business Day and such day shall be treated as the first Business Day
of the required notice period.

 

(d)          Promptly after receipt of a Request for Borrowing pursuant to
Section 2.5(b), the Administrative Agent shall notify the Lenders on the same
Business Day that the Administrative Agent receives such Request for Borrowing
(or the next Business Day of such Request for Borrowing is received after 1:00
p.m. (Eastern Time) on such Business Day), by electronic mail (in a format
bearing a copy of the signature(s) required thereon) or other similar form of
transmission, of the requested Loan. Each Lender shall make the amount of such
Lender’s Pro Rata Share of the requested Loan available to the Administrative
Agent in immediately available funds, to Agent’s Account, not later than 1:00
p.m. (Eastern Time) on the Funding Date applicable thereto. After the
Administrative Agent’s receipt of all proceeds of such Loans, the Administrative
Agent shall make the proceeds thereof available to the Borrower on the
applicable Funding Date by transferring to the Designated Account immediately
available funds equal to the proceeds that are requested by the Borrower to be
sent to the Borrower in the applicable Request for Borrowing or apply such
proceeds (after deduction of any Lender Group Expenses) as directed by the
Borrower.

 

 - 40 - 

 

 

(e)          Unless the Administrative Agent receives written notice from a
Lender, prior to 12:00 p.m. (Eastern Time) on the date of such Loan, that such
Lender will not make available as and when required hereunder to the
Administrative Agent for the account of the Borrower the amount of that Lender’s
Pro Rata Share of the Loan, the Administrative Agent may assume that each Lender
has made or will make such amount available to the Administrative Agent in
immediately available funds on the Funding Date and the Administrative Agent may
(but shall not be so required), in reliance upon such assumption, make available
to the Borrower on such date a corresponding amount. If and to the extent any
Lender (other than the Administrative Agent) shall not have made its full amount
available to the Administrative Agent in immediately available funds and the
Administrative Agent in such circumstances has made available to the Borrower
such amount, that Lender shall on the Business Day following such Funding Date
make such amount available to the Administrative Agent, together with interest
at the Defaulting Lender Rate for each day during such period. A notice
submitted by the Administrative Agent to any Lender with respect to amounts
owing under this subsection shall be conclusive, absent manifest error. If such
amount is so made available, such payment to the Administrative Agent shall
constitute such Lender’s Loan on the date of such Loan for all purposes of this
Agreement. If such amount is not made available to the Administrative Agent on
the Business Day following the Funding Date, the Administrative Agent will
notify Borrower of such failure to fund and, upon demand by the Administrative
Agent, the Borrower shall pay such amount to the Administrative Agent for the
Administrative Agent’s account, together with interest thereon for each day
elapsed since the date of such Loan, at a rate per annum equal to the interest
rate applicable at the time to the Loans composing such Loan, without in any way
prejudicing the rights and remedies of the Borrower against the Defaulting
Lender.

 

 - 41 - 

 

 

(f)          Notwithstanding the provisions of Section 2.3(a)(ii), the
Administrative Agent shall not be obligated to transfer to a Defaulting Lender
any payments made by the Borrower to the Administrative Agent for the Defaulting
Lender’s benefit or any Proceeds of Collateral that would otherwise be remitted
hereunder to the Defaulting Lender, and, in the absence of such transfer to the
Defaulting Lender, the Administrative Agent shall transfer any such payments (i)
first, to the payment of any amounts owing by such Defaulting Lender to the
Administrative Agent hereunder, (ii) second, as the Borrower may request (so
long as no Default or Event of Default exists), to the funding of any Loan in
respect of which such Defaulting Lender has failed to fund its portion thereof
as required by this Agreement, as determined by the Required Agents, (iii)
third, if so determined by the Required Agents and the Borrower, to be held in a
deposit account and released pro rata in order to satisfy such Defaulting
Lender’s potential future funding obligations with respect to Loans under this
Agreement, (iv) fourth, to the payment of any amounts owing to the Lenders as a
result of any judgment of a court of competent jurisdiction obtained by any
Lender against such Defaulting Lender as a result of such Defaulting Lender’s
breach of its obligations under this Agreement, (v) fifth, so long as no Default
or Event of Default exists, to the payment of any amounts owing to the Borrower
as a result of any judgment of a court of competent jurisdiction obtained by the
Borrower against such Defaulting Lender as a result of such Defaulting Lender’s
breach of its obligations under this Agreement, and (vi) sixth, to such
Defaulting Lender or as otherwise directed by a court of competent jurisdiction;
provided that if (x) such payment is a payment of the principal amount of any
Loans in respect of which such Defaulting Lender has not fully funded its
appropriate share, and (y) such Loans were made at a time when the conditions
set forth in Section 3.2 were satisfied or waived, such payment shall be applied
solely to pay the Loans of all Non-Defaulting Lenders on a pro rata basis prior
to being applied to the payment of any Loans of such Defaulting Lender until
such time as all Loans are held by the Lenders in accordance with their Pro Rata
Share. Any payments, prepayments or other amounts paid or payable to a
Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting
Lender pursuant to this Section 2.5(f) shall be deemed paid to and redirected by
such Defaulting Lender, and each Lender irrevocably consents hereto. Solely for
the purposes of voting or consenting to matters with respect to the Loan
Documents (including the calculation of Pro Rata Share in connection therewith)
and for the purpose of calculating the fee payable under Section 2.9(b), such
Defaulting Lender shall be deemed not to be a “Lender” and such Lender’s Term
Loan Commitment shall be deemed to be zero; provided, that the foregoing shall
not apply to any of the matters governed by Sections 11.2(a) through (c). This
Section shall remain effective with respect to such Defaulting Lender until the
earlier of (y) the date on which all of the non-Defaulting Lenders, the Required
Agents and the Borrower shall have waived, in writing, the application of this
Section 2.5(f) to such Defaulting Lender, or (z) the date on which such
Defaulting Lender makes payment of all amounts that it was obligated to fund
hereunder, pays to the Administrative Agent all amounts owing by Defaulting
Lender in respect of the amounts that it was obligated to fund hereunder, and,
if requested by the Required Agents, provides adequate assurance of its ability
to perform its future obligations hereunder (on which earlier date, so long as
no Event of Default has occurred and is continuing, any remaining cash
collateral held by the Collateral Agent pursuant to Section 2.5(f)(ii) shall be
released to the Borrower). The operation of this Section shall not be construed
to increase or otherwise affect the Term Loan Commitment of any Lender, if any,
to relieve or excuse the performance by such Defaulting Lender or any other
Lender of its duties and obligations hereunder, or to relieve or excuse the
performance by the Borrower of its duties and obligations hereunder to the
Agents or to the Lenders other than such Defaulting Lender. Any failure by any
Defaulting Lender to fund amounts that it was obligated to fund hereunder shall
constitute a material breach by such Defaulting Lender of this Agreement and
shall entitle the Borrower at its option, upon written notice to the Agents, to
arrange for a substitute Lender to assume the Term Loan Commitment of such
Defaulting Lender, such substitute Lender to be reasonably acceptable to the
Required Agents. In connection with the arrangement of such a substitute Lender,
the Defaulting Lender shall have no right to refuse to be replaced hereunder,
and agrees to execute and deliver a completed form of Assignment and Acceptance
in favor of the substitute Lender (and agrees that it shall be deemed to have
executed and delivered such document if it fails to do so) subject only to being
repaid its share of the outstanding Obligations (including all interest, fees,
and other amounts that may be due and payable in respect thereof); provided,
that any such assumption of the Term Loan Commitment of such Defaulting Lender
shall not be deemed to constitute a waiver of any of the Lender Groups’ or the
Borrower’s rights or remedies against any such Defaulting Lender arising out of
or in relation to such failure to fund, including Borrower’s right to require
Defaulting Lender to reimburse the Borrower for any fees, charges or expenses
incurred by the Borrower under this Section 2.5(f) as a result of the failure by
any Defaulting Lender to fund amounts that it was obligated to fund hereunder.
In the event of a direct conflict between the priority provisions of this
Section 2.5(f) and any other provision contained in this Agreement or any other
Loan Document, it is the intention of the parties hereto that such provisions be
read together and construed, to the fullest extent possible, to be in concert
with each other. In the event of any actual, irreconcilable conflict that cannot
be resolved as aforesaid, the terms and provisions of this Section 2.5(f) shall
control and govern.

 

(g)          All Loans shall be made by the Lenders contemporaneously and in
accordance with their Pro Rata Shares. It is understood that (i) no Lender shall
be responsible for any failure by any other Lender to perform its obligation to
make any Loan (or other extension of credit) hereunder, nor shall any Commitment
of any Lender be increased or decreased as a result of any failure by any other
Lender to perform its obligations hereunder, and (ii) no failure by any Lender
to perform its obligations hereunder shall excuse any other Lender from its
obligations hereunder.

 

 - 42 - 

 

 

2.6          [Reserved].

 

2.7          Repayment of Borrowings.

 

(a)          The Borrower shall pay to the Administrative Agent in full and
without notice or demand for the account of the Lenders, on the Maturity Date,
all amounts of the Loans then outstanding, in each case, together with accrued
and unpaid interest on the principal amount to be paid to but excluding the date
of such payment.

 

(b)          All repayments of the Loans made pursuant to this Section 2.7 shall
be applied in the manner set forth in Section 2.3(a)(ii).

 

2.8          Prepayments.

 

(a)          The Loans may not be voluntarily prepaid during the Lockout Period.
Subject to Section 2.8(c), following the Lockout Period, the Borrower shall have
the right, at any time and from time to time, to prepay the Loans. The Borrower
shall give the Administrative Agent written notice no later than 1:00 p.m.
(Eastern Time) not less than three (3) Business Days prior to any such
prepayment. In each case, such notice shall specify the date on which such
prepayment is to be made (which shall be a Business Day), and the amount of such
prepayment. Each such prepayment shall be in an aggregate minimum amount of
$500,000 and shall include the Yield Maintenance Premium, if applicable, as well
as interest accrued on the principal amount prepaid to, but not including, the
date of payment in accordance with the terms hereof (or, in each case, such
lesser amount constituting the amount of all Loans then outstanding).

 

(b)          Within five (5) Business Days after the occurrence of a Borrowing
Base Deficiency, the Borrower shall prepay the outstanding principal amount of
the Loans in an amount equal to the sum of (x) the aggregate amount necessary to
eliminate such Borrowing Base Deficiency plus (y) the Yield Maintenance Premium
applicable to the principal amount of the Loan prepaid on such prepayment date,
if any; provided, however, that, no Yield Maintenance Premium shall be due and
payable for an initial $4,000,000 of principal prepaid by the Borrower
(calculated in the aggregate) in connection with cures of the Borrowing Base
Deficiency.

 

(c)          Voluntary prepayments of Loans shall be applied first, to reduce
any outstanding Lender Group Expenses and, second, in such order as the Borrower
may direct. The Borrower may prepay the Loans subject to the payment of any
accrued interest plus the Yield Maintenance Premium applicable to such
prepayment.

 

(d)          Notwithstanding anything else contained herein, no Yield
Maintenance Premium shall be due on the voluntary prepayment of any Lender’s
Loan if, at the time of such prepayment (or on the next Interest Payment Date),
the Borrower is or would be required to pay a gross up indemnity with respect to
any Taxes pursuant to Section 10.11 or compensate such Lender for any increased
costs pursuant to Section 2.11. Other than as set forth in the immediately
preceding sentence and Section 2.8(b) above, Yield Maintenance Premium shall be
due on any prepayment of any Loan prepaid prior to the Yield Maintenance Date.

 

 - 43 - 

 

 

(e)          If a Change of Manager Event occurs, the Borrower will, at the
Lenders’ option (as provided by Lenders in writing to Borrower and Agents),
prepay the Loans, plus accrued interest plus the Yield Maintenance Premium
applicable to the principal amount of the Loan prepaid on such prepayment date,
if any.

 

(f)          If a Change of Control Event occurs, the Borrower will, at the
Lenders’ option (as provided by Lenders in writing to Borrower and Agents),
prepay the Loans plus accrued interest plus the Yield Maintenance Premium
applicable to the principal amount of the Loan prepaid on such prepayment date,
if any.

 

2.9          Fees.

 

(a)          Agent Fees. The Borrower agrees to pay to the Agents for their own
benefit the fees in the amount and at the times set forth in the Agent Fee
Letter. Such Fees shall be fully earned when paid and shall be non-refundable
for any reason whatsoever.

 

(b)          Closing Date Fees. On the Closing Date, the Borrower agrees to pay
to Initial Lender and the Lender Assignees the Upfront Fees set forth in the Fee
Side Letter.

 

2.10        Maintenance of Loan Account; Statements of Obligations. The
Administrative Agent shall maintain an account on its books in the name of the
Borrower (the “Loan Account”) on which the Borrower will be charged with all
Loans made by the Lenders (or the Administrative Agent on behalf thereof) to the
Borrower or for the Borrower’s account and all interest, fees, and expenses (in
each case, as and when payable hereunder or under the other Loan Documents). The
Administrative Agent shall render statements regarding the Loan Account to the
Borrower, including principal, interest, fees, and including an itemization of
all expenses owing, and, subject to the entries in the Register, which shall be
controlling absent manifest error, such statements shall be conclusively
presumed to be correct and accurate (absent manifest error) and constitute an
account stated between the Borrower and the Administrative Agent unless, within
ninety (90) days after receipt thereof by the Borrower, the Borrower shall
deliver to the Administrative Agent written objection thereto describing the
error or errors contained in any such statements.

 

 - 44 - 

 

 

2.11        Increased Costs.

 

(a)          If any change in, or the introduction, adoption, effectiveness,
interpretation or reinterpretation or phase-in, in each case after the date
hereof, of any law or regulation, directive, guideline, decision or request
(whether or not having the force of law) of any court, central bank, regulator
or other Governmental Authority (a “Regulatory Change”) affects the amount of
capital required to be maintained by any Lender and such Lender determines (in
its good faith discretion) that the rate of return on its capital as a
consequence of the Loans or other advances of funds made by such Lender pursuant
to this Agreement or any of the Loan Documents relating to fundings or
commitments under this Agreement is reduced to a level below that which such
Lender would have achieved but for the occurrence of any such circumstance,
then, in any such case within thirty (30) days after written notice (which may
be by email) from time to time by such Lender to the Borrower, the Borrower
shall pay to such Lender compensation sufficient to compensate such Lender for
such reduction in rate of return; provided, that such Lender shall provide the
Borrower with such notice within a reasonable period of time following such
Lender’s discovery of such increased costs or reductions. A statement of such
Lender as to any such additional amount or amounts (including calculations
thereof in reasonable detail), in the absence of manifest error, shall be
conclusive and binding on the Borrower and such Lender. Notwithstanding the
forgoing, (a) the Dodd-Frank Wall Street Reform and Consumer Protection Act and
all requests, rules, guidelines or directives thereunder or issued in connection
therewith, and (b) all requests, rules, guidelines or directives promulgated by
the Bank for International Settlements, the Basel Committee on Banking
Supervision (or any successor or similar authority) or the United States or
foreign Governmental Authorities, in each case pursuant to Basel III, shall, in
the case of clause (a) and clause (b), be deemed to be introduced, adopted,
implemented and/or effective after the date hereof (regardless of the date
enacted, adopted, issued, implemented and/or effective). Notwithstanding
anything to the contrary in this Section 2.11(a), the Borrower shall not be
required to compensate any Lender pursuant to this Section 2.11(a) for any
amounts incurred more than nine months prior to the date that such Lender
notifies the Borrower of such Lender’s intention to claim compensation therefor;
provided that, if the circumstances giving rise to such claim have a retroactive
effect, then such nine month period shall be extended to include the period of
such retroactive effect.

 

(b)          If any Change in Law shall:

 

(i) impose, modify or deem applicable any reserve, special deposit, compulsory
loan, insurance charge or similar requirement against assets of, deposits with
or for the account of, or credit extended or participated in by, any Lender;

 

(ii) subject any Recipient to any Taxes (other than (A) Indemnified Taxes,
(B) Taxes described in clauses (b) through (d) of the definition of Excluded
Taxes and (C) Connection Income Taxes) on its loans, loan principal, letters of
credit, commitments, or other obligations, or its deposits, reserves, other
liabilities or capital attributable thereto; or

 

(iii) impose on any Lender any other condition, cost or expense (other than
Taxes) affecting this Agreement or Loans made by such Lender or any
participation therein;

 

and the result of any of the foregoing shall be to increase the cost to such
Lender or such other Recipient of making, converting to, continuing or
maintaining any Loan or of maintaining its obligation to make any such Loan or
to reduce the amount of any sum received or receivable by such Lender or other
Recipient hereunder (whether of principal, interest or any other amount) then,
upon request of such Lender or other Recipient, the Borrower will pay to such
Lender or other Recipient, as the case may be, such additional amount or amounts
as will compensate such Lender or other Recipient, as the case may be, for such
additional costs incurred or reduction suffered.

 

2.12        [Reserved].

 

2.13        Funding Sources. Nothing herein shall be deemed to obligate the
Lenders (or the Agents on behalf thereof) to obtain the funds to make any Loan
in any particular place or manner and nothing herein shall be deemed to
constitute a representation by the Agents or any Lender that it has obtained or
will obtain such funds in any particular place or manner.

 

 - 45 - 

 

 

2.14        Place of Loans. All Loans made hereunder shall be disbursed by
credit to the Designated Account or as may otherwise be agreed to between
Borrower and the Agents.

 

2.15        Incremental Term Loans.

 

(a)          Incremental Term Commitments. The Borrower may at any time or from
time to time after the Closing Date, by written notice to the Agents (whereupon
the Administrative Agent shall promptly deliver a copy to each of the Lenders)
(an “Incremental Term Loan Request”), request the establishment of one or more
new commitments which shall be in the same Credit Facility as any outstanding
Initial Term Loans (a “Term Loan Increase” and, collectively with any Term Loan
Increase, the “Incremental Term Commitments”) in an aggregate principal amount
not to exceed, $40,000,000.

 

(b)          Incremental Term Loan Request. Each Incremental Term Loan Request
from the Borrower pursuant to this Section 2.15 shall set forth the requested
amount and proposed terms of the relevant Incremental Term Loans. Incremental
Term Loans may be made by any existing Lender (but no existing Lender will have
an obligation to make any Incremental Term Commitment) or by any other bank or
other financial institution or (any such other bank or other financial
institution being called an “Additional Lender”) (each such existing Lender or
Additional Lender providing such, an “Incremental Lender”); provided that (i)
Borrower shall only be permitted to request all or a portion (as applicable) of
the Term Loan Increase from Additional Lenders if the Borrower has offered each
of the existing Lenders an opportunity to provide such Term Loan Increase and
the existing Lenders have declined to provide all or a portion of the Term Loan
Increase (or have not responded in writing to the Borrower within ten (10)
Business Days of any such offer) and (ii) for so long as any of the Required
Lenders are managed or advised by J.P. Morgan Investment Management Inc., the
Additional Lender must be an entity advised or managed by J.P. Morgan Investment
Management Inc. or otherwise approved by J.P. Morgan Investment Management Inc.
(such approval not to be unreasonably withheld, delayed or conditioned);
provided, further, that each Additional Lender, prior to becoming an Incremental
Lender hereunder, shall have provided the Agents with a duly executed IRS From
W-9, or such other applicable IRS Form, a fully completed Administrative Agent
Questionnaire, and all “know your customer” documentation requested by the
Agents.

 

(c)          Incremental Term Loans. On any Incremental Facility Closing Date on
which any Incremental Term Commitments are effected, subject to the satisfaction
of the terms and conditions in this Section 2.15, (i) each Incremental Lender
shall make a loan to the Borrower (an “Incremental Term Loan”) in an amount
equal to its Incremental Term Commitment and (ii) each Incremental Lender shall
become a Lender hereunder with respect to the Incremental Term Commitment and
the Incremental Term Loans made pursuant thereto.

 

 - 46 - 

 

 

(d)          Effectiveness of Incremental Amendment. The effectiveness of any
Incremental Amendment, and the Incremental Term Commitments thereunder, shall be
subject to the satisfaction on the date thereof (the “Incremental Facility
Closing Date”) of each of the following conditions:

 

(i)          no Default or Event of Default has occurred and is continuing or
would result from the Incremental Term Loan; provided that, solely with respect
to any Incremental Term Loans incurred in connection with an acquisition that is
permitted under this Agreement, no Default or Event of Default shall exist at
the time the definitive documentation for such acquisition is executed;

 

(ii)         after giving effect to such Incremental Term Commitments, the
conditions of Section 3.2(a) shall be satisfied (it being understood that all
references to “such date” or similar language in such Section 3.2(a) shall be
deemed to refer to the effective date of such Incremental Amendment); provided
that, if the proceeds of any Incremental Term Commitments are being used to
finance an acquisition permitted hereunder, (x) the reference in Section 3.2(a)
to the accuracy of the representations and warranties shall refer to the
accuracy of the representations and warranties that would constitute “specified
representations” and the representations and warranties in the relevant
acquisition agreement, the breach of which would permit the buyer to terminate
its obligations thereunder or decline to consummate such acquisition and (y) the
reference to “Material Adverse Effect” in the “specified representations” shall
be understood for this purpose to refer to “Material Adverse Effect” or similar
definition as defined in the main transaction agreement governing such
acquisition permitted hereunder;

 

(iii)        after giving effect to such Incremental Term Commitments, the
Borrower is in compliance with the financial covenants set forth in Section
6.12; provided that, solely with respect to any Incremental Term Loans incurred
in connection with an acquisition that is permitted under this Agreement,
compliance with the financial covenants set forth in Section 6.12 shall exist at
the time the definitive documentation for such acquisition is executed; and

 

(iv)        to the extent reasonably requested by the Agents, the Agents shall
have received (A) customary legal opinions addressed to the Agents and the
Lenders, board resolutions and officers’ certificates consistent with those
delivered on the Closing Date other than changes to such legal opinion resulting
from a change in law, change in fact or change to counsel’s form of opinion
reasonably satisfactory to the Agents and (B) reaffirmation agreements and/or
such amendments to the Security Agreement, as may be reasonably requested by the
Agents in order to ensure that the enforceability of the Security Agreement and
the perfection and priority of the Liens thereunder are preserved and
maintained.

 

 - 47 - 

 

 

(e)          Required Terms. The terms, provisions and documentation of the
Incremental Term Loans and Incremental Term Commitments shall be as agreed
between the Borrower and the applicable Incremental Lenders providing such
Incremental Term Commitments, and except (x) to the extent otherwise permitted
under this Section 2.15, (y) to the extent more restrictive on the Borrower or
the Guarantors (when taken as a whole) in any material respect than those with
respect to the Initial Term Loans existing on the Incremental Facility Closing
Date (but excluding any terms or conditions applicable after the Maturity Date)
or (z) to the extent relating only to provisions of a mechanical or
administrative nature, shall be reasonably satisfactory to the Agents. In any
event:

 

(i)          the Incremental Term Loans:

 

(A)         shall rank pari passu in right of payment and in respect of the
Collateral with the Initial Term Loans;

 

(B)         shall not mature earlier than the Maturity Date of any Initial Term
Loans outstanding at the time of incurrence of such Incremental Term Loans;

 

(C)         shall have a Weighted Average Life to Maturity no shorter than the
remaining Weighted Average Life to Maturity of any Initial Term Loans
outstanding at the time of incurrence of such Incremental Term Loans;

 

(D)         subject to Section 2.15(f) below, shall have an applicable rate and
amortization determined by the Borrower and the applicable Incremental Lenders;
and

 

(E)         may participate on a pro rata basis or less than pro rata basis (but
not on a greater than pro rata basis) in any voluntary or mandatory prepayments
of Initial Term Loans hereunder, as specified in the applicable Incremental
Amendment; and

 

(ii)         the proceeds, if any of the Incremental Term Loans, will be used
for general corporate purposes of the Borrower and its Subsidiaries including,
without limitation, for capital expenditures, permitted acquisitions and other
permitted investments, restricted payments, refinancing of indebtedness and any
other transaction not prohibited by this Agreement.

 

(f)          Incremental Amendment.

 

(i)          Incremental Term Commitments shall become Commitments under this
Agreement pursuant to an amendment (an “Incremental Amendment”) to this
Agreement and, as appropriate, amendments to the other Loan Documents, executed
by the Borrower, each Incremental Lender providing such Commitments and the
Agents, as applicable. The Incremental Amendment may, without the consent of any
other Loan Party or, Lender, effect such amendments to this Agreement and the
other Loan Documents as may be necessary or appropriate, in the reasonable
opinion of the Agents and the Borrower, to effect the provisions of this Section
2.15.

 

(ii)         The Lenders hereby irrevocably authorize the Agents to enter into
amendments to this Agreement and the other Loan Documents with the Loan Parties
as may be necessary in order to establish new Loans or commitments made or
established pursuant to this Section 2.15 and such technical amendments as may
be necessary or appropriate in the reasonable opinion of the Agents and the
Borrower in connection with the establishment of such new Loans, in each case on
terms consistent with this Section 2.15, including any amendments that are not
adverse to the interests of any Lender that are made to effectuate changes
necessary to enable any Incremental Term Loans to be fungible for United States
federal income tax purposes with the Initial Term Loans, which shall include any
amendments that do not reduce the ratable amortization received by each Lender
thereunder.

 

(g)          This Section 2.15 shall supersede any provisions in Section 3.3,
Section 9.1 or Section 11.2 to the contrary.

 

 - 48 - 

 

 

2.16        Mitigation of Obligations. If any Lender requests compensation under
Section 2.11, or if the Borrower is required to pay any additional amount to any
Lender or any Governmental Authority for the account of any Lender pursuant to
Section 10.11, then such Lender shall use reasonable efforts to designate a
different one of its lending offices or to assign its rights and obligations
hereunder to another of its offices, branches or affiliates, if (i) in the
reasonable judgment of such Lender, such designation or assignment would
eliminate or reduce amounts payable pursuant to Sections 2.11 or 10.11, as
applicable, and (ii) in the reasonable judgment of such Lender, such designation
or assignment would not subject such Lender to any material unreimbursed cost or
expense and would not otherwise be materially disadvantageous to such Lender.
The Borrower hereby agrees to pay all reasonable costs and expenses incurred by
any Lender in connection with any such designation or assignment.

 

2.17        Pro Rata Treatment.

 

(a)          Each Loan shall be allocated among the Lenders in accordance with
their respective Pro Rata Share.

 

(b)          Except for prepayments contemplated by Section 2.8(d)(y), each
repayment by the Borrower in respect of principal or interest on the Initial
Term Loans and each payment in respect of fees or expenses payable hereunder
shall be applied to the amounts of such obligations owing to the Lenders
entitled thereto in accordance with their respective Pro Rata Share. Each
voluntary prepayment by the Borrower of Initial Term Loans shall be applied to
the amounts of such obligations owing to the Lenders in accordance with their
respective Pro Rata Share (unless such payment is made in accordance with
Section 9.1(f), in which case it shall be made in accordance with such Section).

 

Article III

CONDITIONS TO LOANS

 

3.1          Conditions Precedent to the Initial Term Loan. The obligation of
each Lender to make its initial Loan hereunder is, in addition to the conditions
set forth in Section 3.2 hereof, subject to the fulfillment, to the reasonable
satisfaction of Agents and each Lender and its counsel, of each of the following
conditions on or before the Closing Date:

 

(a)          The Lenders and the Agents shall have received all documentation
and other information required by regulatory authorities under applicable “know
your customer” and anti-money laundering rules and regulations, including the
PATRIOT Act;

 

(b)          The Agents shall have received the results of a recent lien, tax
lien, judgment and litigation search in each of the jurisdictions or offices in
which UCC financing statement or other filings or recordations should be made to
evidence or perfect security interests in all assets of the Loan Parties (or
would have been made at any time during the five years immediately preceding the
Closing Date to evidence or perfect Liens on any assets of the Loan Parties),
and such search shall reveal no Liens or judgments on any of the assets of the
Loan Parties, except for Permitted Liens or Liens and judgments to be terminated
on the Closing Date pursuant to documentation satisfactory to the Agents;

 

 - 49 - 

 

 

(c)          The Agents shall have received this Agreement, any Notes, the
Negative Pledge Agreement, the Security Agreement, the Agent Fee Letter and each
other Loan Document, each duly executed and delivered by each party thereto,
each in form and substance reasonably satisfactory to the Agents;

 

(d)          Each Lender requesting a Note shall have received originals of each
Note (with a copy to the Administrative Agent), duly executed by the Borrower;

 

(e)          The Agents shall have received the written opinions, in the form
attached hereto as Exhibit 3.1(e), and dated the date of the Closing Date, of
counsel to the Loan Parties and the grantors party to the Negative Pledge
Agreement, with respect to this Agreement and the other Loan Documents, which
written opinions shall be in form and substance reasonably satisfactory to the
Agents and their counsel;

 

(f)          The Agents shall have received a certificate of status with respect
to each Loan Party dated within thirty (30) days of the date of this Agreement,
such certificate to be issued by the Secretary of State of the jurisdiction of
organization of each Loan Party, which certificate shall indicate that such Loan
Party is in good standing in such State;

 

(g)          The Agents shall have received a copy of each Loan Party’s
Governing Documents, certified by a Responsible Officer with respect to such
Loan Party;

 

(h)          The Agents shall have received a copy of the resolutions or the
unanimous written consent with respect to each Loan Party, certified as of the
Closing Date by a Responsible Officer of such Loan Party, authorizing (A) the
transactions contemplated by the Loan Documents to which such Loan Party is or
will be a party, and (B) the execution, delivery and performance by such Loan
Party of each Loan Document to which such Loan Party is or will be a party and
the execution and delivery of the other documents to be delivered by such Loan
Party in connection herewith and therewith;

 

(i)          The Agents shall have received a signature and incumbency
certificate of the Responsible Officer with respect to each Loan Party executing
this Agreement, any Notes, the Negative Pledge Agreement, the Security Agreement
and the other Loan Documents not previously delivered to each Agent to which
each Loan Party is a party, certified by a Responsible Officer with respect to
each Loan Party;

 

(j)          The Collateral Agent shall have received originals of any Pledged
Securities that are certificated;

 

(k)          [reserved];

 

(l)          The Agents shall have received copies of all consents (if any) set
forth on Schedule 4.3;

 

(m)          Except as set forth in any publicly available information
(including, without limitation, Exchange Act filings, financial statements,
earnings calls, presentations, press releases and other similar disclosures),
which is publicly available on or before December 31, 2018, since December 31,
2017, no Material Adverse Effect has occurred;

 

 - 50 - 

 

 

(n)          the Borrower shall have paid all fees incurred in connection with
the transactions evidenced by this Agreement on the Closing Date and all Lender
Group Expenses (which in the case of legal fees, shall be subject to the Legal
Expenses Cap) incurred in connection with the transactions evidenced by this
Agreement for which the Borrower received an invoice at least three (3) Business
Days prior to the Closing Date;

 

(o)          the Administrative Agent shall have received a Request for
Borrowing one (1) Business Day prior to the Closing Date, including a general
statement as to the proposed use of proceeds of the draw; and

 

(p)          all other documents and legal matters in connection with the
transactions contemplated by this Agreement shall have been delivered or
executed or recorded and shall be in form and substance reasonably satisfactory
to Agents and their counsel.

 

3.2          Conditions Precedent to All Loans. The obligation of the Lenders to
make any Loan hereunder (or to extend any other credit hereunder) is subject to
the fulfillment, at or prior to the time of the making of such Loan, of each of
the following conditions:

 

(a)          The representations and warranties of the Borrower contained in
this Agreement and the other Loan Documents shall be true and correct on the
Closing Date or, with respect to any Loans made after the Closing Date, in all
material respects (except that such materiality qualifier shall not be
applicable to any representation or warranty to the extent that such
representation or warranty is qualified or modified by materiality) on and as of
the date of such Loan as though made on and as of such date (except to the
extent that such representations and warranties solely relate to an earlier
date) (subject in the case of Incremental Term Loans to Section 2.15(d)(ii));

 

(b)          No Event of Default or Default shall have occurred and be
continuing on the date of such Loan, nor shall either result from the making of
such Loan (subject in the case of Incremental Term Loans to Section 2.15(d)(i));

 

(c)          The Borrower is in compliance with the covenants set forth in
Section 6.12 both before and after giving effect to such Loan (subject in the
case of Incremental Term Loans to Section 2.15(d)(iii));

 

(d)          The Borrower shall have delivered to the Administrative Agent a
Request for Borrowing pursuant to the terms of Section 2.1(b), Section 2.5 and
Section 2.15 hereof, as applicable;

 

(e)          The Borrower shall have delivered a Borrowing Base Certificate to
the Agents at least three (3) Business Days prior to the date of any such Loan,
including a general statement as to the proposed use of proceeds of the draw;
and

 

(f)          The aggregate principal amount of all Loans under this Agreement,
irrespective of whether such Loans have been repaid or prepaid, shall not exceed
$40,250,000 (subject to Section 2.15).

 

 - 51 - 

 

 

3.3          Maturity Date.

 

(a)          This Agreement shall continue in full force and effect for a term
ending on the earlier of (the “Maturity Date”): (a) the six-year anniversary of
the Closing Date and (b) such earlier date on which the Loans shall become due
and payable in accordance with the terms of this Agreement and the other Loan
Documents.

 

Article IV

REPRESENTATIONS AND WARRANTIES OF THE BORROWER

 

Each Loan Party makes the following representations and warranties as of the
date hereof, the Closing Date and on and as of the date of each Loan as though
made on and as of the date of the making of such Loan (except to the extent that
such representations and warranties relate solely to an earlier date) and such
representations and warranties shall survive the execution and delivery of this
Agreement and the making of the Loans:

 

4.1          Due Organization. Each of the Borrower and its Subsidiaries is a
duly organized and validly existing limited liability company in good standing
under the laws of the jurisdiction of its incorporation or organization and is
duly qualified to conduct business in all other jurisdictions where its failure
to do so could reasonably be expected to have a Material Adverse Effect.

 

4.2          Securities and Subsidiaries. Schedule 4.2 sets forth (i) each Loan
Party and its jurisdiction of incorporation or organization as of the Closing
Date and (ii) the number of each class of its Securities authorized, and the
number outstanding, on the Closing Date and the number of Securities covered by
all outstanding options, warrants, rights of conversion or purchase and similar
rights on the Closing Date. All Securities of each Loan Party are duly and
validly issued and are fully paid and non-assessable, and, other than the
Securities of the Borrower, are owned by the Borrower, directly or indirectly.
Each Loan Party is the record and beneficial owner of, and has good and
marketable title to, the Securities pledged by (or purported to be pledged by)
it under the Security Agreement, to the knowledge of each Loan Party, free of
any and all Permitted Collateral Liens (other than in respect to Liens arising
pursuant to clause (d) of the definition thereof), and, as of the Closing Date,
there are no outstanding warrants, options or other rights (including
derivatives) to purchase, or shareholder, voting trust or similar agreements
outstanding with respect to, or property that is convertible into, or that
requires the issuance or sale of, any such Securities (or any economic or voting
interests therein).

 

4.3          Requisite Power and Authorization. Each Loan Party has all
requisite power and authority to execute and deliver this Agreement and the
other Loan Documents to which it is a party, and, if applicable, to borrow the
sums provided for in this Agreement. Each of the Borrower and its Subsidiaries
has all governmental licenses, authorizations, consents, and approvals necessary
to own and operate its Assets and to carry on its businesses as now conducted
and as proposed to be conducted, other than licenses, authorizations, consents,
and approvals that are not currently required or the failure to obtain which
could not reasonably be expected to be materially adverse to any Lender. The
execution, delivery, and performance of this Agreement and the other Loan
Documents have been duly authorized by each Loan Party and all necessary limited
liability company or corporate action in respect thereof has been taken, and,
other than as set forth on Schedule 4.3, the execution, delivery, and
performance thereof do not require any other material consent or approval of any
other Person that has not been obtained.

 

 - 52 - 

 

 

4.4          Binding Agreements. This Agreement and the other Loan Documents to
which any Loan Party is a party, when executed and delivered by such Loan Party,
will constitute the legal, valid, and binding obligations of such Loan Party,
enforceable against such Loan Party in accordance with their terms except as the
enforceability hereof or thereof may be affected by: (a) bankruptcy, insolvency,
reorganization, moratorium, or other similar laws affecting the enforcement of
creditors’ rights generally, and (b) equitable principles of general
applicability (whether considered in a proceeding in equity or law).

 

4.5          Other Agreements. The execution, delivery, and performance by each
Loan Party of this Agreement and the other Loan Documents to which any Loan
Party is a party, do not and will not: (a) violate (i) in any material respect
any provision of any federal (including the Exchange Act), state or local law,
rule, or regulation (including Regulations T, U, and X of the Federal Reserve
Board) binding on any Loan Party, (ii) in any material respect any order of any
Governmental Authority, court, arbitration board or tribunal binding on any Loan
Party or (iii) the Governing Documents of any Loan Party, or (b) contravene any
provisions of, result in a breach of, constitute (with the giving of notice or
the lapse of time) a default under, or result in the creation of any Lien (other
than Liens granted by the Loan Parties to the Collateral Agent, for the benefit
of the Secured Parties, to secure the Obligations under this Agreement) upon any
of the Assets of any Loan Party pursuant to any Material Agreement, or (c)
require termination of any Material Agreement, or (d) constitute a tortious
interference with any material Contractual Obligation of the Borrower or its
Subsidiaries.

 

4.6          Litigation: Adverse Facts and Compliance with Laws.

 

(a)          There is no action, suit, proceeding, or arbitration (irrespective
of whether purportedly on behalf of any Loan Party) at law or in equity, or
before or by any federal, state, municipal, or other governmental department,
commission, board, bureau, agency, or instrumentality, domestic or foreign,
pending or threatened in writing against or affecting the Borrower and any of
its Subsidiaries, that could reasonably be expected to have a Material Adverse
Effect, or could reasonably be expected to materially and adversely affect any
Loan Party’s ability to perform its obligations under the Loan Documents to
which it is a party (including Borrower’s or any Guarantor’s ability to repay
any or all of the Loans when due);

 

(b)          Neither the Borrower nor any of its Subsidiaries is subject to or
in default with respect to any order, final judgment, writ, injunction, decree,
rule, or regulation of any Governmental Authority in a manner that could
reasonably be expected to have a Material Adverse Effect or could reasonably be
expected to materially and adversely affect any Loan Party’s ability to perform
its obligations under the Loan Documents to which it is a party (including
Borrower’s or any Guarantor’s ability to repay any or all of the Loans when
due);

 

 - 53 - 

 

 

(c)          Neither the Borrower nor any of its Subsidiaries (i) has failed to
comply with Environmental Laws or to obtain, maintain and comply with any
permit, license or other approval required to be obtained by the Borrower or any
of its Subsidiaries under any Environmental Law, (ii) is subject to any material
liability under Environmental Law, (iii) has received written notice of any
claim alleging that it is in violation of Environmental Law or has liability
under Environmental Law or (iv) has actual knowledge of existing facts or
circumstances that would reasonably be expected to form the basis of a claim
that it has liability under Environmental Law, except, in the case of each of
items (i) through (iv) above, would not reasonably be expected to have a
Material Adverse Effect;

 

(d)          Each Loan Party and all Affiliates of all of the foregoing are in
compliance with the Foreign Corrupt Practices Act of 1977 and any applicable
foreign counterpart thereto. No Loan Party or Affiliate of any of the foregoing
has made, offered, promised or authorized a payment of money or anything else of
value (i) in order to assist in obtaining or retaining business for or with, or
directing business to, any foreign official, foreign political party, party
official or candidate for foreign political office, (ii) to any foreign
official, foreign political party, party official or candidate for foreign
political office, or (iii) with the intent to induce the recipient to misuse his
or her official position to direct business wrongfully to any Loan Party or any
Affiliate of any of the foregoing, or any other Person, in violation of the
Foreign Corrupt Practices Act; and

 

(e)          (i) There is no action, suit, proceeding or investigation pending
or, to the best of the Borrower’s knowledge, threatened in writing against or
affecting the Borrower or any of its Subsidiaries that questions the validity or
the enforceability of this Agreement or other the Loan Documents, and (ii) there
is no action, suit, or proceeding pending against or affecting any Loan Party
pursuant to which, on the date of the making of any Loan hereunder, there is not
in effect a binding injunction that could reasonably be expected to materially
and adversely affect the validity or enforceability of this Agreement or the
other Loan Documents.

 

4.7          Government Consents. Other than such as may have previously been
obtained, filed, or given, as applicable, no consent, license, permit, approval,
or authorization of, exemption by, notice to, report to or registration, filing,
or declaration with, any Governmental Authority is required in connection with
the execution, delivery, and performance by the Loan Parties of the Loan
Documents to which they are a party, in each case, except as could not
reasonably be expected to have a Material Adverse Effect.

 

4.8          Title to Assets; Liens. Except for Permitted Liens, all of the
Assets held by the Borrower and its Subsidiaries are free from all Liens of any
nature whatsoever. Except for Permitted Liens, the Borrower and its Subsidiaries
have good and sufficient title to all of the Assets held by the Borrower and its
Subsidiaries.

 

4.9          ERISA. Except as could not reasonably expected to have a Material
Adverse Effect, each Plan is in compliance with the applicable provisions of
ERISA, the Code and other Federal and state laws. Except as could not reasonably
be expected to have a Material Adverse Effect, (i) no ERISA Event has occurred
or is reasonably expected to occur; (ii) no Loan Party has incurred, or
reasonably expects to incur, any liability (including liability as an ERISA
Affiliate of another Person) under Title IV of ERISA with respect to any Single
Employer Plan (other than premiums due and not delinquent under Section 4007 of
ERISA); (iii) no Loan Party has incurred or reasonably expects to incur any
liability (including liability as an ERISA Affiliate of another Person), and no
event has occurred which, with the giving of notice under Section 4219 of ERISA,
would result in such liability, under Section 4201 or 4243 of ERISA with respect
to a Multiemployer Plan; and (iv) neither any Loan Party nor any of its ERISA
Affiliate has engaged in a transaction that could be subject to Section 4069 or
4212(c) of ERISA.

 

 - 54 - 

 

 

4.10        Payment of Taxes. All material tax returns and reports of the Loan
Parties (and all parent entities of such Loan Parties with which any Loan Party
is or has been consolidated or combined) required to be filed by it have been
timely filed (inclusive of any permitted extensions), and all material Taxes,
governmental assessments, fees, and amounts required to be withheld and paid to
a Governmental Authority and all other governmental charges imposed upon the
Loan Parties, and upon their Collateral, income, and franchises, that are due
and payable have been paid except for any claims for Taxes that are being
contested, in good faith, by appropriate proceedings promptly instituted and
diligently conducted, and with respect to which an adequate reserve or other
appropriate provision, if any, shall have been made in order to be in conformity
with GAAP.

 

4.11        Governmental Regulation.

 

(a)          The Loan Parties are not, nor immediately after the application by
the Borrower of the proceeds of the Loans will they be, required to be
registered as an “investment company” under the Investment Company Act of 1940,
as amended.

 

(b)          No Loan Party holds any interest in any Margin Securities. No part
of the proceeds of the loans made to the Borrower will be used to purchase or
carry any Margin Securities or to extend credit to others for the purpose of
purchasing or carrying any Margin Securities or for any purpose that violates
the provisions of Regulation T, U or X of the Board of Governors.

 

(c)          No Loan Party is subject to regulation under any federal, state, or
local law, rule, or regulation generally limiting its ability to incur Debt.

 

4.12        Disclosure. No written statement, representation or warranty of any
Loan Party contained in this Agreement or any other document, certificate, or
written information furnished to any Agent or any Lender with respect to the
business, operations, Collateral, or condition (financial or otherwise) of the
Loan Parties in connection with the transactions contemplated by this Agreement
(other than projections, pro forma financial statements and budgets and
information of a general economic or industry-wide nature) contains any untrue
statement of a material fact or omits to state a material fact necessary in
order to make the statements contained herein or therein, in light of the
circumstances under which they were made, not materially misleading. There is no
fact known to any Loan Party (other than matters of a general economic
industry-wide nature) that any Loan Party believes reasonably could be expected
to have a Material Adverse Effect, that has not been disclosed herein or in such
other documents, certificates, and statements furnished to any Agent or any
Lender for use in connection with the transactions contemplated hereby.

 

4.13        Debt. The Borrower and its Subsidiaries do not have any Debt
outstanding other than Debt permitted by Section 6.1 hereof.

 

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4.14        Existing Defaults. Neither the Borrower nor any of its Subsidiaries
is in default in the performance, observance or fulfillment of any of the
obligations contained in any Contractual Obligation applicable to it, and no
condition exists which, with or without the giving of notice or the lapse of
time, would constitute a default under any such Contractual Obligation, except,
in any such case, where the consequences, direct or indirect, of such default or
defaults, if any, could not reasonably be expected to have a Material Adverse
Effect. No event of default has occurred under any Securitization Transaction
which remains uncured or unwaived and no circumstance, event or condition has
occurred or exists which, with the giving of notice and/or the expiration of the
applicable period would constitute an event of default under the documents
relating to the Securitization Transactions.

 

4.15        No Material Adverse Effect. No event or development has occurred
which could reasonably be expected to result in a Material Adverse Effect.

 

4.16        Security Documents. The Security Agreement is effective to create in
favor of the Collateral Agent, for the benefit of the Secured Parties, a legal,
valid, binding and enforceable first-priority security interest in the
Collateral described herein and therein and in proceeds and products thereof as
set forth herein and therein (subject to Permitted Collateral Liens). In the
case of (i) Pledged Securities represented by certificates, (x) when such
certificates are delivered to the Collateral Agent or (y) when financing
statements in appropriate form are filed in the offices specified on Schedule
4.16, and (ii) the other Collateral described in the Security Agreement, when
financing statements in appropriate form are filed in the offices specified on
Schedule 4.16 and such other filings as are specified on Schedule 2 to the
Security Agreement have been completed, the Lien created by the Security
Agreement shall constitute a fully perfected Lien on, and security interest in,
all right, title and interest of the Loan Parties in such Collateral and the
proceeds and products thereof, as security for the Secured Obligations (as
defined in the Security Agreement), in each case, prior and superior in right to
any other Person (subject to Permitted Collateral Liens).

 

4.17        Solvency. The Borrower is, each Loan Party is, and the other
Subsidiaries of the Borrower are taken as a whole, both immediately before and
immediately following the making of each Loan and after giving effect to the
application of the proceeds of each Loan, the pledge of Collateral and the
guarantee in favor of the Agents and the Lenders, as applicable, Solvent.

 

4.18        Use of Proceeds.

 

(a)          The proceeds of the Loans shall be used (i) to redeem existing
preferred equity of the Borrower and its Subsidiaries, (ii) to permit the
Borrower and its Subsidiaries to purchase or originate and hold Borrowing Base
Eligible Assets, (iii) for any general other corporate purposes of the Borrower
and its Subsidiaries (including for capital expenditures, permitted acquisitions
and other permitted investments, restricted payments, refinancing of
indebtedness and any other transaction not prohibited by the Loan Documents) and
(iv) to pay fees and expenses related to the Transactions.

 

 - 56 - 

 

 

(b)          No part of the proceeds of the Loans will be used, directly or
indirectly, for any payment to any governmental official or employee, political
party, official of a political party, candidate for political office, or anyone
else acting in an official capacity, in order to obtain, retain or direct
business or obtain any improper advantage, in violation of the United States
Foreign Corrupt Practices Act of 1977, as amended.

 

4.19        Anti-Corruption and Anti-Money Laundering Laws and Sanctions. Each
Loan Party has implemented and maintains in effect policies and procedures
reasonably designed to ensure compliance by each Loan Party, their Subsidiaries
and their respective directors, officers, employees and agents with
Anti-Corruption Laws, Anti-Money Laundering Laws and Sanctions, and each Loan
Party and its Subsidiaries and their respective directors, officers and
employees are, to the knowledge of each Loan Party, its directors and agents, in
compliance with Anti-Corruption Laws, Anti-Money Laundering Laws, and Sanctions
in all material respects. None of (i) the Loan Parties or, to the knowledge of
each Loan Party, their Subsidiaries, or to the knowledge of the Loan Parties or
such Subsidiaries, any of their respective directors, officers or employees, or
(ii) to the knowledge of the Loan Parties, any agent of the Loan Parties or any
Subsidiary that will act in any capacity in connection with or benefit from the
credit facility established hereby, is a Sanctioned Person. No Loan, use of
proceeds from this Agreement or other transaction contemplated by this Agreement
will violate Anti-Corruption Laws, Anti-Money Laundering Laws or Sanctions.

 

4.20        REIT Status; Loan Party Tax Status. The Borrower has been organized
and operated in a manner that has allowed it to qualify and has qualified as a
REIT commencing with its taxable year ending 2012 and its proposed method of
operation will enable it to meet the requirements for qualification and taxed as
a REIT under the Code. Hunt Commercial Mortgage Trust has been organized and
operated in a manner that has allowed it to elect to qualify as a REIT
commencing with its taxable year ending 2018 and its proposed method of
operation will enable it to meet the requirements for qualification and taxed as
a REIT under the Code.

 

4.21        Ownership. Each of the grantors under the Security Agreement owns
all legal and equitable title to the assets pledged by it to the Lenders.

 

4.22        Borrower Financial Covenants. As of the Closing Date, all Borrower
Financial Covenants are satisfied.

 

Article V

AFFIRMATIVE COVENANTS OF THE BORROWER

 

The Borrower covenants and agrees that until payment, in full, of the Loans,
with interest accrued and unpaid thereon, the Borrower will, and will cause its
Subsidiaries to, do each and all of the following:

 

5.1          Accounting Records and Inspection.

 

(a)          Maintain adequate financial and accounting books and records in
accordance with sound business practices and GAAP consistently applied; and

 

 - 57 - 

 

 

(b)          permit any representative of the Agents (and after the occurrence
and during the continuance of an Event of Default, any representatives of each
Lender) upon reasonable notice to the Borrower, at any time during usual
business hours, to inspect, audit, and examine the Borrower’s financial and
accounting books and records and to make copies and take extracts therefrom, and
to discuss its affairs, financing, and accounts with the Borrower’s or the
Guarantors’ officers and independent public accountants (provided that the
Borrower shall have the opportunity to be present at any meeting with its
independent public accountants); provided that unless an Event of Default has
occurred and is continuing, no more than one inspection per year may be made at
the Borrower’s expense.

 

5.2          Financial Statements. Furnish to the Agents:

 

(a)          As soon as publicly available (including, pursuant to any filing
under the Exchange Act or with any national securities exchange), but in any
event within ninety (90) days after the end of each fiscal year of the Borrower
(commencing with the fiscal year ended December 31, 2018), a copy of the
consolidated balance sheet of the Borrower as at the end of such fiscal year and
the related consolidated statements of income or operations, changes in
stockholders’ equity and cash flows for such fiscal year, all in reasonable
detail and prepared in accordance with GAAP, audited and accompanied by a
customary report and opinion of an independent certified public accounting firm
of nationally recognized standing (including without limitation Ernst & Young,
PricewaterhouseCoopers LLP, Deloitte, KPMG, CohnReznick LLP and Grant Thornton)
which report and opinion shall be prepared in accordance with generally accepted
auditing standards and shall not be subject to any “going concern” or like
qualification or exception or any qualification or exception as to the scope of
such audit (other than a “going concern” qualification resulting solely from an
upcoming maturity date under the Credit Facilities occurring within one year
from the time such opinion is delivered); and

 

(b)          As soon as publicly available (including, pursuant to any filing
under the Exchange Act or with any national securities exchange), but in any
event within forty-five (45) days after the end of each of the first three
fiscal quarters of each fiscal year of the Borrower (commencing with the fiscal
quarter ended March 31, 2019), a copy of the unaudited consolidated balance
sheet of the Borrower as at the end of such fiscal quarter and the related
unaudited consolidated statements of income or operations, changes in
stockholders’ equity and cash flows for such fiscal quarter and the portion of
the fiscal year through the end of such fiscal quarter, all in reasonable detail
(subject only to normal year-end audit adjustments).

 

5.3          Certificates; Other Information. Furnish to the Agents:

 

(a)          concurrently with the delivery of the financial statements pursuant
to Section 5.2(a) and (b), (i) a completed Compliance Certificate duly executed
by a Responsible Office of the Borrower containing all information and
calculations necessary (in reasonable detail) for determining (A) that no Event
of Default or any Default has occurred or is continuing, (B) if a Default has
occurred, a statement as to the nature thereof and the action which is proposed
to be taken in respect thereto and (C) compliance by the Borrower with Section
6.12, in each case, as of the last day of the fiscal quarter or fiscal year of
the Borrower (including the supporting calculations related thereto), (ii) a
duly completed Borrowing Base Certificate setting forth the Borrowing Base based
on the most recent Borrowing Base Value and (iii) notice of any event giving
rise to the occurrence of a VAE;

 

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(b)          promptly (but in any event within five (5) Business Days unless
otherwise specified), after a Responsible Officer of the Borrower or any
Guarantor has knowledge thereof, written notice of:

 

(i)          the occurrence of any Event of Default or any Default;

 

(ii)         any Material Modification that occurs and, in any such event, the
Borrower shall also supply the Agents with copies of any modifications, waivers
or forbearances allowed by the Borrower pursuant thereto within five (5)
Business Days following the occurrence thereof;

 

(iii)        the occurrence of a VAE in respect of any Borrowing Base Eligible
Asset within five (5) Business Days following the occurrence thereof;

 

(iv)        [reserved];

 

(v)         a judgment by any competent court against the Borrower or any of its
Subsidiaries for the payment of money in an amount greater than $3,500,000;

 

(vi)        any default or event of default as defined in any Contractual
Obligation relating to Debt, in each case in an amount not less than $3,500,000
and irrespective of whether such Debt is accelerated or such default waived;

 

(c)          as soon as practicable, written notice of any condition or event
which has resulted or could reasonably be expected to result in a Material
Adverse Effect.

 

(d)          such other information as any Agent and any Lender may reasonably
request from time to time in connection with any of the Collateral or other
business or financial information of the Borrower and its Subsidiaries; and

 

(e)          If requested by any Agent from time to time, promptly deliver to
the Agents copies of any annual report to be filed in connection with each Plan.

 

5.4          Existence. Preserve and maintain its legal existence and all of its
material rights, privileges, licenses and franchises and qualify and remain
qualified in good standing (where relevant) as a foreign limited liability
company, statutory trust or limited partnership, as applicable, in each other
jurisdiction where the nature of its business requires such qualification and to
the extent such concept exists in such jurisdiction.

 

5.5          Payment of Taxes and Claims. File all material Tax returns
including income Tax returns required to be filed by or on behalf of the Loan
Parties. Pay all (a) material Taxes, governmental assessments, and other
governmental charges imposed on any of the Loan Parties or upon any of the
Borrowing Base Eligible Assets or the Collateral or in respect of any of its
businesses, incomes, Collateral, or Borrowing Base Eligible Assets before any
penalty or interest accrues thereon, and (b) all claims in excess of $100,000 in
the aggregate (including claims for labor, services, materials, and supplies)
for sums which have become due and payable and which by law have or may become a
Lien upon any of the Collateral or Borrowing Base Eligible Assets, prior to the
time when any penalty or fine shall be incurred with respect thereto; provided,
however, that, unless such Taxes, assessments, charges, or claims have become a
federal tax Lien on any of the Collateral or the Borrowing Base Eligible Assets,
no such Tax, assessment, charge, or claim need be paid if the same is being
diligently contested, in good faith, by appropriate proceedings promptly
instituted and diligently conducted and if an adequate reserve or other
appropriate provision, if any, shall have been made therefor as required in
order to be in conformity with GAAP.

 

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5.6          Compliance with Laws and Material Contractual Obligations. (a)
Comply in all material respects with the requirements of all applicable laws,
rules, regulations (including Regulations T, U and X of the Federal Reserve
Board), and orders of any Governmental Authority, noncompliance with which could
reasonably be expected to have a Material Adverse Effect and (b) perform in all
material respects its obligations under Material Agreements to which it is a
party.

 

5.7          Further Assurances. At any time or from time to time upon the
request of the Agents, execute and deliver such further documents and do such
other acts and things as the Agents may reasonably request in order to effect
fully the purposes of this Agreement or the other Loan Documents and to provide
for payment of the Loans made hereunder, with interest thereon, in accordance
with the terms of this Agreement.

 

5.8          Payment of Obligations. Pay, discharge or otherwise satisfy as the
same shall become due and payable in the normal conduct of its business all its
material obligations and liabilities including, without limitation, any such
material obligations pursuant to any agreement by which it or any of its
properties is bound.

 

5.9          Maintenance of Insurance. Maintain with financially sound and
reputable insurance companies not Affiliates of the Borrower insurance with
respect to its properties and business against loss or damage of the kinds
customarily insured against by Persons engaged in the same or a similar business
of such types and in such amounts (after giving effect to any self-insurance
compatible with the following standards) as are customarily carried under
similar circumstances by such other Persons.

 

5.10        Maintenance of Property and Licenses. In addition to the
requirements of the Security Agreement, (a) protect and preserve all property
necessary in and material to their business then being conducted, including
copyrights, patents, real estate, trade names, service marks and trademarks, (b)
maintain in good working order and condition, ordinary wear and tear and
casualty excepted, all buildings, equipment and other tangible real and personal
property necessary and material to its business as then being conducted and (c)
from time to time make or cause to be made all repairs, renewals and
replacements thereof and additions to such property necessary and material for
the conduct of its business as then being conducted, so that the business
carried on in connection therewith may be conducted in a commercially reasonable
manner.

 

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5.11        Covenant to Guarantee Obligations and Give Security. Execute any and
all further documents, financing statements, agreements and instruments, and
take all further action (including filing Uniform Commercial Code and other
financing statements) that may be required under applicable requirements of law,
or that the Required Lenders or the Agents may reasonably request, in order to
effectuate the Transactions contemplated by the Loan Documents and in order to
grant, preserve, protect and perfect the validity and priority of the security
interests created or intended to be created by the Loan Documents.
Notwithstanding anything to the contrary set forth herein, in no event shall
this Section 5.11 require the granting of any Lien on any Excluded Assets.

 

5.12        ERISA. (a) Make, or cause to be made, timely payment of
contributions required to meet the requirements of the Pension Funding Rules
with respect to each Single Employer Plan; (b) notify the Agents as soon as
practicable (but in any event within five (5) Business Days) of any ERISA Event;
and (c) furnish to the Agents, promptly upon Agent’s request therefor, such
additional information concerning any Single Employer Plan as may be reasonably
requested by the Agents from time to time.

 

5.13        Post-Closing Items. Within the time periods specified on Schedule
5.13 (or such later date to which the Agents consent in writing), comply with
the provisions set forth in Schedule 5.13.

 

5.14        REIT Status. Each of the Borrower and Hunt Commercial Mortgage Trust
shall maintain its REIT status; none of the other Loan Parties (other than a
taxable REIT subsidiary formed for the purpose of owning non-qualifying assets)
shall be treated as a corporation separate from the Borrower for U.S. federal
income tax purposes.

 

5.15        Cash Management. With respect to any asset underlying a Borrowing
Base Subsidiary, the Borrower shall cause any distributions or payments on such
asset which are distributable or payable to the Borrowing Base Subsidiary
(either directly or indirectly and after the payment of any related Warehouse
Debt or Securitization Indebtedness due and payable on such date, if applicable)
to be deposited promptly (and no later than two (2) Business Days following
receipt thereof), into an account which is under the control of the Collateral
Agent on behalf of the Lenders and subject to the Borrower DACA.

 

Article VI

NEGATIVE COVENANTS OF THE BORROWER

 

The Borrower covenants and agrees that, until payment, in full, of the Loans,
with interest accrued and unpaid thereon, the Borrower will not and will not
permit any of its Subsidiaries to do any of the following:

 

6.1          Debt. Create, incur, assume, permit, guarantee, or otherwise become
or remain, directly or indirectly, liable with respect to any Debt, except:

 

(a)          Debt evidenced by this Agreement and the other Loan Documents;

 

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(b)          Debt or amounts available under Debt facilities (whether or not
drawn) existing on the Closing Date and listed on Schedule 6.1 and any draws,
refinancings, renewals or extensions thereof so long as: (i) such draws,
refinancings, renewals, replacements or extensions do not result in an increase
in the aggregate maximum principal amount of the Debt permitted under such Debt
facilities so drawn, refinanced, renewed, or extended (other than for accrued
interest and premiums and fees), (ii) such draws, refinancings, renewals,
replacements, or extensions do not result in a shortening of the average
weighted maturity of the Debt so drawn, refinanced, renewed, replaced, or
extended, nor are they on terms or conditions that, taken as a whole, are
materially more burdensome or restrictive to the Borrower or any of its
Subsidiaries, and (iii) the Debt that is drawn, refinanced, renewed, replaced,
or extended is not recourse to any Person that is liable on account of the Loans
other than those Persons which were obligated with respect to the Debt that was
drawn, refinanced, renewed, replaced, or extended;

 

(c)          Warehousing Debt;

 

(d)          Securitization Indebtedness;

 

(e)          Debt in respect of Capitalized Lease Obligations and Purchase Money
Obligations financing an acquisition, construction, repair, replacement, lease
or improvement of a fixed or capital asset incurred by the Borrower or any of
its Subsidiaries within two hundred seventy (270) days after the acquisition,
construction, repair, replacement, lease or improvement of the applicable asset
in an aggregate principal amount not to exceed $5,000,000;

 

(f)          Debt in respect of netting services, overdraft protections and
otherwise in connection with deposit accounts incurred in the ordinary course of
business;

 

(g)          guaranties in the ordinary course of business of the obligations of
suppliers, customers, franchisees and licensees of the Borrower and its
Subsidiaries;

 

(h)          Debt of the Borrower or any of its Subsidiaries in respect of
letters of credit, bank guarantees, bankers’ acceptances, warehouse receipts or
similar instruments created or issued in the ordinary course of business in
connection with workers’ compensation claims, health, disability or other
employee benefits or property, casualty or liability insurance or self-insurance
or other Debt with respect to reimbursement-type obligations regarding workers’
compensation claims;

 

(i)          Debt owing to any insurance company in connection with the
financing of any insurance premiums permitted by such insurance company in the
ordinary course of business in an amount not exceed $500,000 at any time
outstanding;

 

(j)          (i) Debt representing deferred compensation or stock-based
compensation incurred in the ordinary course of business and (ii) Debt issued by
the Borrower or any Subsidiary to current or former officers, directors,
employees, managers and consultants, and their respective personnel, estates,
spouses or former spouses, of any the Borrower or any Subsidiary, in lieu of or
combined with cash payments, to finance the purchase or redemption by any such
Person of Securities of the Borrower or any Subsidiary, in each case, to the
extent such purchase or redemption is permitted by Section 6.4;

 

(k)          for the avoidance of doubt, any amounts payable by the Borrower or
any of its Subsidiaries with respect to declared and unpaid dividends that were
permitted by Section 6.4 at the time of declaration;

 

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(l)          Debt of the Borrower or any of its Subsidiaries under any Swap
Agreements so long as such Swap Agreements are used solely as a part of its
normal business operations as a risk management strategy or a hedge against
changes resulting from market operations and not as a means to speculate for
investment purposes on trends and shifts in financial or commodities markets;

 

(m)          Debt incurred in the ordinary course of business under incentive,
non-compete, consulting, deferred compensation, or other similar arrangements
incurred by the Borrower or any of its Subsidiaries;

 

(n)          Debt in respect of Taxes, governmental assessments or governmental
charges to the extent that payment thereof shall not at the time be required to
be made hereunder;

 

(o)          Additional senior secured loans (which shall rank pari passu with
all outstanding senior secured loans (including the Loans)) in an aggregate
amount up to $40,000,000 (in minimum increments of $10,000,000); provided, that,
such debt shall be (1) on terms no more favorable to the lenders thereof than
the terms applicable to the Debt evidenced by this Agreement and the other Loan
Documents (and if such Debt is on more favorable terms than the terms of this
Agreement and the Loan Documents, then the Borrower shall be required to cause
an amendment to this Agreement and the Loan Documents to give the benefit of
such more favorable terms to the Lenders), (2) such additional Debt shall not
mature prior to or have a weighted average life shorter than the Debt evidenced
by this Agreement and the other Loan Document and (3) the Lender Assignees shall
have a right of first offer to participate as lenders in such additional senior
secured loans;

 

(p)          Debt assumed or incurred by any Subsidiary with respect to any
Asset acquired by such Subsidiary as a result of a foreclosure, deed-in-lieu or
other similar proceeding or transactions in connection with the ownership by
such Subsidiary of any Senior Commercial Real Estate Loans, Senior Commercial
Real Estate Construction Loans, Mezzanine Loans, Subordinated Commercial Real
Estate Loans or Preferred Equity Investment so long as, with respect to any new
Debt that is incurred, the loan-to-value ratio of such Debt does not exceed 80%
at the time incurred (it being understood that any such Debt shall be
non-recourse to the Borrower and the documents governing such Debt may include
customary carve-outs to limit recourse such as recourse to the Borrower for
environmental matters, fraud, misrepresentation or voluntary and involuntary
bankruptcy filings);

 

(q)          Contingent Obligations resulting from the endorsement of
instruments for collection in the ordinary course of business or that otherwise
become due and are satisfied within twenty (20) days thereof;

 

(r)          Debt between the Borrower and any of its Subsidiaries and so long
as such Debt is evidenced by a promissory note and subordinated to the Loans
pursuant to an Intercompany Subordination Agreement to the extent that the
obligor on such Debt is a Loan Party;

 

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(s)          Debt which may be deemed to exist pursuant to any performance
bonds, surety bonds, statutory bonds, appeal bonds or similar obligations
incurred in the ordinary course of business;

 

(t)          Guarantees of any Debt permitted pursuant to this Section 6.1;

 

Any Debt incurred by any Loan Party or any Subsidiary that is permitted by this
Section 6.1 shall only be issued to the extent that (i) there is no Borrowing
Base Deficiency hereunder, (ii) no Default or Event of Default has occurred and
is continuing and (iii) the Borrower’s Total Net Leverage Ratio is not greater
than 4.5:1.0, in each case, at the time of any subsequent funding of such
permitted debt (taking into account the funding of the related loan amount);
provided, that clause (iii) hereof shall only apply to Debt for Borrowed Money.
The Borrower may issue preferred equity which is subordinate to the Loans with a
maturity date beyond the final legal maturity of the Loans which shall not be
considered Debt in the Total Net Leverage Ratio.

 

6.2          Liens. Create, incur, assume, or permit to exist, directly or
indirectly, any Lien on or with respect to any of its Assets, of any kind,
whether now owned or hereafter acquired, or any income or profits therefrom,
except:

 

(a)          Permitted Collateral Liens;

 

(b)          Liens on Assets securing Debt permitted under Sections 6.1(a), (c),
(d), (e), (h), (l), (o), (p) and (t); provided that, with respect to any Liens
securing Debt permitted under Section 6.1(l), such Liens shall be permitted to
the extent they are created, incurred, or exist on or with respect to cash, Cash
Equivalents and/or letters of credit (and proceeds thereof) in an aggregate
amount not to exceed 10% of the Tangible Net Worth of the Borrower and its
Subsidiaries;

 

(c)          Liens on Mezzanine Loans, Subordinated Commercial Real Estate Loans
and Preferred Equity Investments to the extent securing Debt permitted under
Sections 6.1(c) and (d); provided that, any Liens on Mezzanine Loans,
Subordinated Commercial Real Estate Loans and Preferred Equity Investments
created, incurred, assumed, or existing pursuant to this clause (d) do not
exceed the 15% of the aggregate outstanding amount of any related Warehousing
Debt facility or Securitization Indebtedness; and

 

(d)          Liens securing Debt or amounts available under Debt facilities
(whether or not drawn) existing on the Closing Date and listed on Schedule 6.2.

 

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6.3          Debt Prepayments. Make or offer to make (or give any notice in
respect thereof) any optional or voluntary payment, prepayment, repurchase or
redemption of, or voluntarily or optionally defease, or otherwise satisfy prior
to the scheduled maturity thereof in any manner, any Debt (other than the Loans
and, for the avoidance of doubt, any revolving credit facilities, overdraft
lines of credit or other similar revolving obligations); except that (a) the
Borrower or any of its Subsidiaries may make such voluntary payments,
repayments, repurchases or redemptions of, or voluntary or optional
defeasements, or otherwise satisfy prior to the scheduled maturity thereof in
any manner (other than payments, repayments, repurchases, redemptions or
defeasements constituting Extraordinary Restricted Payments), any Debt so long
as (i) no Event of Default or Default has occurred and is continuing or would
result therefrom and (ii) the Borrower is in pro forma compliance with the
financial covenants set forth in Section 6.12 immediately before and after
giving effect to such payments (b) the Borrower shall be permitted to make
Extraordinary Restricted Payments but only with the prior written consent of the
Required Lenders (not to be unreasonably withheld, delayed or conditioned unless
an Event of Default or Default has occurred and is continuing or would result
therefrom) and (c) the Borrower or any of its Subsidiaries may make such
voluntary payments, repayments, repurchases or redemptions of, or voluntary or
optional defeasements, or otherwise satisfy prior to the scheduled maturity
thereof, any Warehousing Debt or Securitization Indebtedness unless an Event of
Default or Default has occurred and is continuing or would result therefrom.

 

6.4          Dividends. The Borrower shall not make or declare, directly or
indirectly, any dividend or other payment or distribution on account of any
interest of any class of equity securities in Borrower, whether now or hereafter
outstanding (collectively, a “Distribution”); except (a) the Borrower may make
Distributions (other than Extraordinary Restricted Payments) so long as (i) no
Event of Default or Default has occurred and is continuing or would result
therefrom and (ii) the Borrower is in pro forma compliance with the financial
covenants set forth in Section 6.12 immediately before and after giving effect
to such Distribution and (b) notwithstanding anything to the contrary in this
Agreement, the Borrower may make Distributions at any time in an amount
necessary to maintain its status as a “real estate investment trust” as defined
in Section 856 of the Code (“REIT”) and avoid the imposition of income and
excise tax on the Borrower. The Borrower shall be permitted to make
Extraordinary Restricted Payments but only with the prior written consent of the
Required Lenders (not to be unreasonably withheld, delayed or conditioned unless
an Event of Default or Default has occurred and is continuing or would result
therefrom).

 

6.5          Restriction on Fundamental Changes. Change its name, change the
nature of its business, enter into any merger, consolidation, reorganization, or
recapitalization, or reclassify its partnership interests (whether limited or
general) or membership interests, as applicable, or convey, sell, assign, lease,
transfer, or otherwise dispose of, in one transaction or a series of
transactions, all or any substantial part of its business or Assets, whether now
owned or hereafter acquired (each, a “Fundamental Change”) except:

 

(a)          Borrower or any of its Subsidiaries may sell Assets in accordance
with the provisions of Section 6.6;

 

(b)          Borrower or any of its Subsidiaries may change its name or
corporate, partnership or limited liability structure so long as (i) the Loan
Parties provide written notice thereof (together with copies of any documents
evidencing any such change) to the Agents on or before the date that is ten (10)
Business Days prior to the date when such name or structure change occurs and
(ii) any other Subsidiaries of the Borrower provide written notice thereof
(together with copies of any documents evidencing any such change) to the Agents
on or before the date that is thirty (30) days after the date when such name or
structure change occurs; and

 

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(c)          the conveyance, sale, assignment, lease, transfer, or other
disposal of all or any substantial part of its business or Collateral, merger,
consolidation or reorganization of any Person, on the one hand, with and into
the Borrower or any of its Subsidiaries, provided that (i) the Lender Group’s
rights in any Assets, including, without limitation, the existence, perfection
and priority of any Lien thereon, are not adversely affected by such merger,
consolidation or reorganization, (ii) upon the consummation of such conveyance,
sale, assignment, lease, transfer, or other disposal of all or any substantial
part of its business or Assets, merger, consolidation or reorganization, the
Borrower and any applicable Subsidiary expressly reaffirms its Obligations to
the Lender Group under this Agreement and the other Loan Documents to which it
is a party and (iii) such acts do not result in a Change of Control Event.

 

6.6           Sale of Assets. Sell, assign, transfer, convey, or otherwise
dispose of its Assets (any such transaction, a “Sale”), whether now owned or
hereafter acquired, except for (a) any Sale by the Borrower in the ordinary
course of business (it being understood that any Sale of MSRs shall not be
considered to be in the ordinary course of business of the Borrower for purposes
of this subclause (a)), (b) any Sale of obsolete, worn out or surplus tangible
property, (c) any Sale of Assets for the liquidation, dissolution or winding up
of a wholly-owned Subsidiary of the Borrower (i) if from a non-Loan Party
Subsidiary, to any another Subsidiary and (ii) if from a Loan Party, to another
Loan Party, (d) any transaction permitted by Sections 6.4 or 6.5 of this
Agreement; (e) any Sale pursuant to, or in connection with, any Securitization
Transaction or Warehousing Debt; (f) any other Sale of Assets of the Borrower
and the Subsidiaries so long as (i) the Borrower is in compliance with the
financial covenants set forth in Section 6.12 immediately before such Sale of
Assets, and immediately after giving effect thereto, (ii) any such Sale of
Assets shall be for fair market value consideration (as determined by the
Borrower in good faith and consistent with the Assigned Value given such Asset
for purposes of this Agreement in the most recent Borrowing Base Certificate
delivered to the Agents) and of which at least 75% of such consideration shall
be comprised of cash or Cash Equivalents and (iii) no Default or Event of
Default has occurred and is continuing or would result therefrom, in each case,
immediately prior to and after giving effect to such Sale for fair market value.

 

6.7           Transactions with Shareholders and Affiliates. Enter into or
permit to exist, directly or indirectly, any transaction (including the
purchase, sale, lease, or exchange of any Asset or the rendering of any service)
with any holder of 15 % or more of any class of Securities of the Borrower or
any of its Subsidiaries or Affiliates, or with any Affiliate of the Borrower or
of any such holder, in each case other than (x) a Loan Party or (y) any
Subsidiary of the Borrower, on terms that are less favorable to such Subsidiary,
than those terms that might be obtained at the time from Persons who are not
such a holder, Subsidiary, or Affiliate, or, if such transaction is not one in
which terms could be obtained from such other Person, on terms that are no less
favorable than terms negotiated in good faith on an arm’s length basis. Prior to
the Borrower or any of its Subsidiaries engaging in any such transaction
described in this Section 6.7, other than transactions in de minimis amounts,
the Borrower shall determine that such transaction has been negotiated in good
faith and on an arm’s length basis. In no event shall the foregoing restrictive
covenant apply to (a) any transaction permitted by Section 6.4 or
(b) transactions involving the use, transfer, or other disposition of any Asset,
to the extent that (i) the Distribution by the Borrower of such Asset would not
have violated this Agreement and (ii) such use, transfer, or other disposition
would not otherwise result in an Event of Default or an Default.

 

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6.8           Conduct of Business. Engage in any business other than the
business to which it is engaged as of the Closing Date and any related
businesses or activities substantially similar or related thereto or reasonable
extensions of any such business or activities including, without limitation, the
commercial real estate mortgage business, commercial real estate brokerage
business, commercial real estate business, commercial real estate-related
securities acquisitions and acquisitions of MSRs.

 

6.9           Amendments or Waivers of Certain Documents; Actions Requiring the
Consent of the Agents. Agree to any amendment to or waiver of the terms or
provisions of its Governing Documents except for amendments or waivers which
would not, either individually or collectively, be materially adverse to the
interests of the Lender Group; provided, that any amendment or waiver to the
Governing Documents which adversely affects the validity or priority of the
Lender’s security interest in any of the Collateral shall be deemed to be
materially adverse to the interests of the Lender Group.

 

6.10         Limitation on Negative Pledges. Enter into or suffer to exist or
become effective any agreement or other arrangement that prohibits, restricts or
imposes any condition upon the ability of the Borrower or any of its
Subsidiaries to create, incur, assume or suffer to exist any Lien upon any
Collateral (other than Securities in Securitization Entities), whether now owned
or hereafter acquired, to secure the Obligations, except for any restrictions
that:

 

(a)          exist under this Agreement and the other Loan Documents;

 

(b)          exist on the date hereof and (to the extent not otherwise permitted
by this Section 6.10) are listed on Schedule 6.10 hereto;

 

(c)          are binding on a Subsidiary or its Assets at the time such
Subsidiary or its Assets first becomes a Subsidiary or owned by a Subsidiary, as
applicable, so long as such restrictions were not entered into solely in
contemplation of such Person becoming a Subsidiary;

 

(d)          are customary restrictions and conditions contained in any
agreement relating to any transaction permitted by Section 6.6 pending the
consummation of such transaction; provided that such restrictions and conditions
apply only to the property that is the subject of such transaction and not to
the proceeds to be received by the Borrower or any of its Subsidiaries in
connection with such transaction;

 

(e)          are customary restrictions in leases, subleases, licenses or asset
sale agreements otherwise permitted hereby so long as such restrictions relate
solely to the assets subject thereto;

 

(f)          are customary provisions restricting subletting or assignment of
any lease governing a leasehold interest of the Borrower or any Subsidiary;

 

(g)          are customary provisions restricting assignment or transfer of any
agreement entered into in the ordinary course of business; and

 

(h)          are amendments, modifications, restatements, refinancings or
renewals of the agreements, contracts or instruments referred to in Sections
6.10(b) through (g) above; provided that such amendments, modifications,
restatements, refinancings or renewals, taken as a whole, are not materially
more restrictive with respect to such encumbrances and restrictions than those
contained in such predecessor agreements, contracts or instruments.

 

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6.11         Margin Regulation. Use any portion of the proceeds of any of the
Loans in any manner which could reasonably be expected to cause the Loans, the
application of such proceeds, or the Transactions to violate Regulations T, U or
X of the Federal Reserve Board, or any other regulation of such board, or to
violate the Exchange Act, or to violate the Investment Company Act of 1940.

 

6.12         Financial Covenants. The Borrower shall not:

 

(a)          Minimum Asset Coverage Ratio. Commencing with the fiscal quarter
ending March 31, 2019, permit the Asset Coverage Ratio on the last day of each
Test Period, be less than 110%.

 

(b)          Minimum Unencumbered Asset Ratio. Commencing with the fiscal
quarter ending March 31, 2019, permit the Unencumbered Asset Ratio on the last
day of each Test Period, be less than of 135%.

 

(c)          Maximum Total Net Leverage Ratio. Commencing with the fiscal
quarter ending March 31, 2019, permit the Total Net Leverage Ratio on the last
day of each Test Period to exceed 6.00:1.00; provided that, after any equity
offering of the Borrower, the Total Net Leverage Ratio shall step down to a
ratio no greater than 120% of the ratio immediately after the Capital Event,
with a floor of 4.50:1.00.

 

(d)          Minimum Tangible Net Worth. Permit the Tangible Net Worth on the
last day of each Test Period (commencing with the fiscal quarter ending March
31, 2019), to be less than the amount equal to the sum of (i) eighty percent
(80%) of the Borrower’s and its Subsidiaries’ Tangible Net Worth as of October
31, 2018 (provided that any preferred equity of the Borrower outstanding as of
such date and on or prior to the Closing Date shall not be included in the
calculation of Tangible Net Worth), which Tangible Net Worth is equal to as of
such date, plus (ii) eighty percent (80%) of the net proceeds (after deducting
transaction costs) that the Borrower and its Subsidiaries receive from
subsequent equity issuances.

 

(e)          Minimum Interest Coverage Ratio. Commencing with the fiscal quarter
ending March 31, 2019, permit the Interest Coverage Ratio on the last day of
each Test Period, to be less than 1.4x.

 

(f)           Loan Concentration.

 

(i)          Permit less than 65.0% of loans held for investment (as defined in
the consolidated balance sheet of the Borrower) by the Borrower to be comprised
of Senior Commercial Real Estate Loans, as measured by the average daily
outstanding principal balance of all loans held for investment (as defined in
the consolidated balance sheet of the Borrower) during a fiscal quarter and as
adjusted for non-controlling interests for which none of the Borrower or its
Affiliates or the Borrower’s external manager or its Affiliates holds majority
lender status or similar voting control for the subject loan.

 

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(ii)         Permit more than 30% of total assets (by unpaid principal balance
or if unpaid principal balance is not available, by book value (which in the
case of MSRs, shall be the value provided by the Valuation Agent) owned by the
Borrower to be comprised of non-multi-family assets during a fiscal quarter.

 

(iii)        Permit more than 30% of the Borrowing Base Eligible Assets (by
unpaid principal balance or if unpaid principal balance is not available, by
book value (which in the case of MSRs, shall be the value provided by the
Valuation Agent) to be comprised of non-multi-family assets during a fiscal
quarter.

 

6.13         Plans. No Loan Party shall become a party to any Multiemployer Plan
or Single Employer Plan other than any such plan to which the Loan Party as a
party on the date of this Agreement without first notifying the Agents, or fail
to meet all of the requirements of the Pension Funding Rules with respect to a
Single Employer Plan. No Loan Party shall, or shall cause or permit any ERISA
Affiliate to (a) cause or permit to occur any event that could result in the
imposition of a Lien against a Loan Party under the Pension Funding Rules or (b)
cause or permit to occur an ERISA Event which could reasonably be expected to
have a Material Adverse Effect.

 

6.14         Change of Servicer and Special Servicer. The Borrower shall not
permit a change in special servicer for any of Mortgage Assets from an affiliate
of Hunt Investment Management, LLC to an unaffiliated entity without written
approval by the Required Lender(s) at their sole discretion within ninety (90)
days of the change occurring. The Borrower shall not permit a change in the
primary servicer for any of Mortgage Assets which has a rating lower than “CMS3”
by Fitch Ratings or which causes the securities in the related Securitization
Transaction to be downgraded, unless otherwise approved by the Required
Lender(s) at their sole discretion within ninety (90) days of the change
occurring.

 

Article VII

 

EVENTS OF DEFAULT AND REMEDIES

 

7.1           Events of Default. The occurrence of any one or more of the
following events, acts, or occurrences shall constitute an event of default
(“Event of Default”) hereunder:

 

(a)          Failure to Make Payments When Due.

 

(i)          Any Loan Party shall (A) fail to pay any amount owing hereunder
with respect to the principal of any of the Loans when such amount is due,
whether at stated maturity, by acceleration, or otherwise or (B) fail to comply
with Section 2.8(b); or

 

(ii)         Any Loan Party shall fail to pay, within three (3) Business Days of
the date when due, any amount owing hereunder with respect to interest on any of
the Loans or with respect to any other amounts (including fees, costs, or
expenses) other than the amounts specified in clause (i) above, payable in
connection herewith.

 

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(b)          Breach of Certain Covenants.

 

(i)          Any Loan Party shall fail to perform or comply with any covenant,
term, or condition contained in Article VI of this Agreement or in any other
Loan Document; provided that an Event of Default with respect to Section 6.12
shall not occur until the Cure Expiration Date; and

 

(ii)         Any Loan Party shall fail to perform or comply with any other
covenant, term, or condition contained in this Agreement or other Loan Documents
to which it is a party and such failure shall not have been remedied or waived
within twenty (20) days after the earlier of (x) knowledge of the occurrence
thereof by the Borrower or (y) receipt of notice from any Agent of the
occurrence thereof; provided, however, that this clause (ii) shall not apply to:
(1) the covenants, terms, or conditions referred to in subsections (a) and (c)
of this Section 7.1; or (2) the covenants, terms, or conditions referred to in
clause (i) above of this subsection (b).

 

(c)          Breach of Representation or Warranty. Any financial statement,
representation, warranty, or certification made or furnished by the Borrower or
any other Loan Party under this Agreement or in any document, letter, or other
writing or instrument furnished or delivered by the Borrower to any Agent or any
Lender pursuant to or in connection with this Agreement or any other Loan
Document to which it is a party shall have been false, incorrect, or incomplete
in any material respect (except that such materiality qualifier shall not be
applicable to any representation or warranty to the extent that such
representation or warranty is qualified or modified by materiality or “Material
Adverse Effect”) when made, deemed made or reaffirmed, as the case may be.

 

(d)          Involuntary Bankruptcy.

 

(i)          If an involuntary petition under chapter 7 or chapter 11 of the
Bankruptcy Code or any similar proceeding shall be filed against the Borrower or
any of its Subsidiaries (other than Immaterial Subsidiaries) under any other
applicable law and any of the following events occur: (1) such Person consents
to the institution of the involuntary case or similar proceeding; (2) the
petition commencing the involuntary case or similar proceeding is not timely
controverted; (3) the petition commencing the involuntary case or similar
proceeding is not dismissed within sixty (60) days of the date of the filing
thereof; provided, however, that, during the pendency of such period, the Lender
Group shall be relieved of its obligation to make additional Loans; (4) an
interim trustee is appointed to take possession of all or a substantial portion
of the Collateral of the Borrower or any of its Subsidiaries (other than
Immaterial Subsidiaries); or (5) an order for relief shall have been issued or
entered therein.

 

(ii)         A decree or order of a court having jurisdiction in the premises
for the appointment of a receiver, liquidator, sequestrator, custodian, trustee,
or other officer having similar powers over the Borrower or any of its
Subsidiaries (other than Immaterial Subsidiaries) to take possession of all or a
substantial portion of its Collateral shall have been entered and, within sixty
(60) days from the date of entry, is not vacated, discharged, or bonded against,
provided, however, that, during the pendency of such period, the Lender Group
shall be relieved of its obligations to make additional Loans.

 

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(e)          Voluntary Bankruptcy. The Borrower or any of its Subsidiaries
(other than Immaterial Subsidiaries) shall file a petition for relief under
chapter 7 or chapter 11 of the Bankruptcy Code; the Borrower or any of its
Subsidiaries (other than Immaterial Subsidiaries) shall commence or otherwise
consent to Insolvency Proceedings or shall otherwise institute any similar
proceeding under any other applicable law, or shall consent thereto; the
Borrower or any of its Subsidiaries (other than Immaterial Subsidiaries) shall
consent to the conversion of an involuntary case to a voluntary case; or the
Borrower or any of its Subsidiaries (other than Immaterial Subsidiaries) shall
consent or acquiesce to the appointment of a receiver, liquidator, sequestrator,
custodian, trustee, or other officer with similar powers to take possession of
all or a substantial portion of its Collateral; the Borrower or any of its
Subsidiaries (other than Immaterial Subsidiaries) shall generally fail to pay
debts as such debts become due or shall admit in writing its inability to pay
its debts generally; or the Borrower or any of its Subsidiaries (other than
Immaterial Subsidiaries) shall make a general assignment for the benefit of
creditors.

 

(f)           Dissolution. Any order, judgment, or decree shall be entered
decreeing the dissolution of the Borrower or any of its Subsidiaries (other than
Immaterial Subsidiaries), and such order, judgment or decree shall remain
undischarged or unstayed for a period in excess of sixty (60) days.

 

(g)         Change of Control. A Change of Control Event shall occur.

 

(h)          Judgments and Attachments. The Borrower or any of its Subsidiaries
shall suffer any money judgment, writ, or warrant of attachment, or similar
process involving payment of money in an amount, net of any portion thereof that
is covered by or recoverable by the Borrower or such Subsidiary under applicable
insurance policies (if any) in excess of $3,500,000 and shall not discharge,
vacate, bond, or stay the same within a period of sixty (60) days.

 

(i)           Guaranty. (1) If the obligation of any Guarantor under the
Guaranty is limited or terminated by operation of law or such Guarantor
thereunder, (2) if any Guarantor shall fail to perform or comply with any
covenant, term, or condition contained in the Guaranty or (3) any financial
statement, representation, warranty, or certification made or furnished by any
Guarantor under this Agreement, the Guaranty or in any document, letter, or
other writing or instrument furnished or delivered by such Guarantor to any
Agent or any Lender pursuant to or in connection with this Agreement, the
Guaranty or any other Loan Document to which it is a party, or as an inducement
to the Lender Group to enter into this Agreement or any other Loan Document
shall have been false, incorrect, or incomplete in any material respect (except
that such materiality qualifier shall not be applicable to any representation or
warranty to the extent that such representation or warranty is qualified or
modified by materiality or “Material Adverse Effect”) when made, deemed made or
reaffirmed, as the case may be.

 

(j)           Cross-Default. The Borrower or any of its Subsidiaries shall be in
default relating to Debt (other than Debt evidenced by this Agreement) which is
outstanding in excess of a principal amount of $3,500,000, individually or in
the aggregate, and such default shall continue beyond any or all applicable
grace, cure and notice periods relating to such Debt (as such periods may be
extended with the approval of all applicable counterparties to such Debt and by
the Required Lenders).

 

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(k)          ERISA. There occurs one or more ERISA Events which has resulted or
could reasonably be expected, individually or in the aggregate, to result in a
Material Adverse Effect.

 

(l)           Agent’s Liens. If any Loan Document that purports to create a Lien
shall fail or cease to create, except to the extent permitted by the terms of
any such Loan Document, a valid and perfected Lien on the Collateral; and

 

(m)          Loan Documents. Any provision of any Loan Document shall at any
time for any reason be declared to be null and void, or the validity or
enforceability thereof shall be contested by any Loan Party or any Negative
Pledgor Subsidiary, or a proceeding shall be commenced by any Loan Party, any
Negative Pledgor Subsidiary or any Governmental Authority having jurisdiction
over any Loan Party or any Negative Pledgor Subsidiary, seeking to establish the
invalidity or unenforceability thereof, or any Loan Party or any Negative
Pledgor Subsidiary shall deny in writing that any Loan Party or Negative Pledgor
Subsidiary has any liability or obligation purported to be created under any
Loan Document.

 

7.2           Remedies. Upon the occurrence of an Event of Default:

 

(a)          If such Event of Default arises under subsections (d) or (e) of
Section 7.1 hereof, then all of the Obligations owing hereunder or under the
other Loan Documents automatically shall become immediately due and payable,
without presentment, demand, protest, notice, or other requirements of any kind,
all of which are hereby expressly waived by the Borrower; and

 

(b)          In the case of any other Event of Default that has occurred and is
continuing, the Required Agents may declare all of the Obligations owing
hereunder or under the Loan Documents to be, and the same immediately shall
become due and payable, without presentment, demand, protest, further notice, or
other requirements of any kind, all of which are hereby expressly waived by the
Borrower.

 

Upon any exercise of rights pursuant to Sections 7.2(a) and (b) above, the
Agents (without notice to or demand upon the Borrower, which are expressly
waived by the Borrower to the fullest extent permitted by law), shall be
entitled to proceed to protect, exercise, and enforce the Lender Group’s rights
and remedies hereunder or under the other Loan Documents, or any other rights
and remedies as are provided by law or equity. The Agents may determine, in
their sole discretion, the order and manner in which the Lender Group’s rights
and remedies are to be exercised. All payments received by the Agents shall be
applied in accordance with Section 2.3 (a)(ii).

 

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7.3           Borrower’s Right to Cure. 

 

(a)          Notwithstanding anything to the contrary contained in Section 7.1,
for purposes of determining whether an Event of Default has occurred under any
financial covenant set forth in Section 6.12, any cash received by the Borrower
after the last day of the fiscal quarter in respect of which such Event of
Default has occurred and on or prior to the date that is five (5) Business Days
after the date on which financial statements are required to be delivered for
such fiscal quarter (the “Cure Expiration Date”) will, at the request of the
Borrower, be included in the calculation of Borrowing Base or the Borrowing Base
Eligible Assets solely for the purposes of determining compliance with the
financial covenants set forth in Section 6.12 at the end of such fiscal quarter
and any subsequent period that includes such fiscal quarter (a “Cash Cure
Amount”); provided that (a) the amount of any Cash Cure Amount and the use of
proceeds therefrom will be no greater than the amount required to cause the
Borrower to be in compliance with the financial covenants set forth in Section
6.12 and (b) the proceeds of all Cash Cure Amounts shall be applied to prepay
the Loans and accompanied by the applicable Yield Maintenance Premium required
by Section 2.8(d) (if any). Upon the delivery of the Cash Cure Amount to the
Borrower prior to the Cure Expiration Date, any Event of Default that has
occurred pursuant to Section 6.12 shall be deemed to not have occurred and, for
the avoidance of doubt, neither any Agent nor any Lender shall exercise the
right to accelerate the Loans and none of any Agent, any Lender or any Secured
Party shall exercise any right to foreclose on or take possession of the
Collateral or exercise any other remedy pursuant to Section 7.2, the other Loan
Documents or applicable law prior to the Cure Expiration Date solely on the
basis of an Event of Default having occurred and continuing under Section 6.12
(except to the extent that the Borrower has confirmed that in writing that it
does not intend to provide a Cash Cure Amount). For the avoidance of doubt, the
Borrower shall not be able to obtain any Loan hereunder until receipt by the
Agents of the Cash Cure Amount; and

 

(b)          Notwithstanding anything to the contrary herein, the Borrower shall
(to the extent capable of cure) have five (5) Business Days to cure any event
that would give rise to a reduction in value of any Borrowing Base Eligible
Asset, including, for the avoidance of doubt, a VAE and any event described in
Section 11.5.

 

Article VIII

EXPENSES AND INDEMNITIES

 

8.1           Expenses. The Borrower shall pay without duplication, (i) all
reasonable and documented out-of-pocket costs and expenses (except allocated
costs of in-house counsel) reasonably incurred by the Agents and the Lenders in
connection with the preparation, negotiation, execution, delivery and
administration of this Agreement and the other Loan Documents, or any
amendments, modifications or waivers of the provisions hereof or thereof,
including the reasonable and documented fees, charges and disbursements of
counsel (but limited to (A) one primary counsel for the Agents, (B) one primary
counsel for the Lenders and (C) if necessary, one local counsel in each relevant
jurisdiction (which may include a single special counsel acting in multiple
jurisdictions) and in the case of an actual or perceived conflict of interest,
where the party affected by such conflict, informs the Borrower of such conflict
and thereafter retains its own counsel, of another firm of counsel for each such
affected person); provided, however, that the Borrower is not obligated to
reimburse the Lenders for legal fees incurred on or before the Closing Date in
connection with the preparation of this Agreement and the other Loan Documents
to the extent that such legal fees exceed $250,000 (the “Legal Expenses Cap”)
and (ii) all out-of-pocket costs and expenses incurred by each Agent or each
Lender (including the fees, charges and disbursements of any counsel for any
Agent or any Lender) in connection with the development, preparation,
negotiation and execution of any amendment, waiver, consent or other
modification of the provisions of this Agreement or any other Loan Document and
the enforcement or protection of any rights and remedies under this Agreement
(including, without limitation, with respect to the Collateral) and the other
Loan Documents, including all such costs and expenses incurred during any legal
proceeding, including any proceeding under any Debtor Relief Law, and including
in connection with any workout, restructuring or negotiations in respect of the
Credit Facilities and the Loan Documents, including the customary and reasonable
fees, charges and disbursements of counsel (collectively, the expenses set forth
in clause (i) and (ii), the “Lender Group Expenses”).

 

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8.2           Indemnity. In addition to the payment of expenses pursuant to
Section 8.1 hereof, the Borrower agrees to indemnify, exonerate, defend, pay,
and hold harmless the Agent-Related Persons and the Lender-Related Persons
(collectively the “Indemnitees” and individually as “Indemnitee”) from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, causes of action, judgments, suits, claims, costs, expenses, and
disbursements of any kind or nature whatsoever (including the reasonable and
documented fees and disbursements of (A) one primary counsel for the
Agent-Related Persons, taken as a whole, (B) one primary counsel for the
Lender-Related Persons, taken as a whole, and (C) if reasonably necessary, one
local counsel in each relevant jurisdiction for the Agent-Related Persons and
Lender-Related Persons (which may include a single special counsel acting in
multiple jurisdictions) and in the case of an actual or perceived conflict of
interest, where the party affected by such conflict is advised in writing by its
outside counsel and informs the Borrower of such conflict and thereafter retains
its own counsel, of another firm of counsel for each such affected person) in
connection with any investigation, administrative, or judicial proceeding,
whether such Indemnitee shall be designated a party thereto), that may be
imposed on, incurred by, or asserted against such Indemnitee, in any manner
relating to or arising out of the execution a, delivery, enforcement,
performance, syndication or administration of any Loan Document or any other
agreement, letter or instrument delivered in connection with the transactions
contemplated thereby, the business or Assets of any Loan Party (to include,
without limitation, any actual or alleged presence or release of Hazardous
Material on or from any property currently or formerly owned or operated by
Borrower, any Subsidiary or any other Loan Party, or any violation of any
Environmental Law related in any way to the Borrower, and any Subsidiary or any
other Loan Party), the Commitments, the use or intended use of the proceeds of
the Loans or the consummation of the transactions contemplated by this
Agreement, including any matter relating to or arising out of the filing or
recordation of any of the Loan Documents which filing or recordation is done
based upon information supplied by the Borrower to the Agents and its counsel
(the “Indemnified Liabilities”); provided, that the Borrower shall have no
obligation hereunder to any Indemnitee to the extent (x) that such Indemnified
Liabilities are found in a final non-appealable judgment by a court of competent
jurisdiction to have resulted from the gross negligence, bad faith, or willful
misconduct of such Indemnitee or (y) any dispute solely among Indemnitees (other
than any claims against an Indemnitee in its capacity or in fulfilling its role
as an agent or arranger or any similar role hereunder or under any other Loan
Document and other than any claims arising out of any act or omission of the
Borrower). The obligations of the Borrower under this Section 8.2 shall survive
the termination of this Agreement and the discharge of the Borrower’s other
obligations hereunder. This Section 8.2 shall not apply with respect to Taxes,
which shall be governed by Section 10.11, other than any Taxes that represent
liabilities, obligations, losses or damages, arising from a non-Tax claim.

 

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Article IX

 

ASSIGNMENT AND PARTICIPATIONS

 

9.1           Successors and Assigns Generally. (a)     The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns permitted hereby, except that,
subject to Section 9.1(f), neither the Borrower nor any other Loan Party may
assign or otherwise transfer any of its rights or obligations hereunder without
the prior written consent of the Agents and each Lender, and no Lender may
assign or otherwise transfer any of its rights or obligations hereunder except
(i) to an assignee in accordance with the provisions of Section 9.1(b), (ii) by
way of participation in accordance with the provisions of Section 9.1(d), or
(iii) by way of pledge or assignment of a security interest subject to the
restrictions of Section 9.1(e) (and any other attempted assignment or transfer
by any party hereto shall be null and void). Nothing in this Agreement,
expressed or implied, shall be construed to confer upon any Person (other than
the parties hereto, their respective successors and assigns permitted hereby,
Participants to the extent provided in Section 9.1(d) and, to the extent
expressly contemplated hereby, the Agent-Related Persons of each of the Agents
and the Lenders) any legal or equitable right, remedy or claim under or by
reason of this Agreement.

 

(b)          Assignments by Lenders. Any Lender may at any time assign to one or
more assignees all or a portion of its rights and obligations under this
Agreement (including all or a portion of its Commitment and the Loans at the
time owing to it); provided that (in each case with respect to any Credit
Facility) any such assignment shall be subject to the following conditions:

 

(i)          Minimum Amounts. Except in the case of an assignment to a Lender or
an Affiliate of a Lender, the aggregate amount of the Commitment (which for this
purpose includes Loans outstanding thereunder) or, if the applicable Commitment
is not then in effect, the principal outstanding balance of the Loans of the
assigning Lender subject to each such assignment (determined as of the date the
Assignment and Acceptance with respect to such assignment is delivered to the
Administrative Agent) shall not be less than $1,000,000, unless so long as no
Event of Default has occurred and is continuing, the Borrower consents in
writing to the assignment of such lesser amount (each such consent not to be
unreasonably conditioned, withheld or delayed).

 

(ii)         Proportionate Amounts. Each partial assignment shall be made as an
assignment of a proportionate part of all the assigning Lender’s rights and
obligations under this Agreement with respect to the Loan or the Commitment
assigned, except that this clause (ii) shall not prohibit any Lender from
assigning all or a portion of its rights and obligations among Initial Term
Loans on a non-pro rata basis.

 

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(iii)        Required Consents. No consent shall be required for any assignment
except to the extent required by Section 9.1(b)(i) and, in addition: (A) the
written consent of the Borrower shall be required (such consent not to be
unreasonably conditioned, withheld or delayed); provided that, no consent of the
Borrower shall be required (x) in the event a Default (after expiry of any
grace, cure and notice periods or as further extended with the approval of the
Required Lenders) or an Event of Default has occurred and is continuing at the
time of such assignment or (y) if such assignment is to a Lender, an Affiliate
of a Lender or an Approved Fund; provided, further, that the Borrower shall be
deemed to have consented to any such assignment unless it shall object thereto
by written notice to the Agents within ten (10) Business Days after having
received written notice thereof (which notice shall provide, in bold type face,
that if the Borrower does not object in writing to such assignment within ten
(10) Business Days, the Borrower’s consent shall have been deemed to have been
provided) and (B) the consent of the Agents (such consent not be unreasonably
withheld or delayed) shall be required for assignments in respect of any Loans
to a Person who is not a Lender, an Affiliate of a Lender or an Approved Fund.

 

(iv)        Assignment and Acceptance. The parties to each assignment shall
execute and deliver to the Administrative Agent an Assignment and Acceptance,
together with a processing and recordation fee of $3,500; provided that the
Required Agents may, in their sole discretion, elect to waive such processing
and recordation fee in the case of any assignment. The assignee, if it is not a
Lender, shall deliver to the Agents an Administrative Questionnaire, a duly
executed IRS Form W-9, or such other IRS Form as applicable, and all “know your
customer” documentation requested by the Administrative Agent.

 

(v)         No Assignment to Certain Persons. No such assignment shall be made
to the Borrower or any of the Borrower’s Affiliates or Subsidiaries except as
permitted by Section 9.1(f).

 

(vi)        Certain Additional Payments. In connection with any assignment of
rights and obligations of any Defaulting Lender hereunder, no such assignment
shall be effective unless and until, in addition to the other conditions thereto
set forth herein, the parties to the assignment shall make such additional
payments to the Administrative Agent in an aggregate amount sufficient, upon
distribution thereof as appropriate (which may be outright payment, purchases by
the assignee of participations or subparticipations, or other compensating
actions, including funding, with the consent of the Borrower and the Required
Agents, the applicable pro rata share of Loans previously requested but not
funded by the Defaulting Lender, to each of which the applicable assignee and
assignor hereby irrevocably consent), to pay and satisfy in full all payment
liabilities then owed by such Defaulting Lender to the Agents and each other
Lender hereunder (and interest accrued thereon), in accordance with its
applicable percentage. Notwithstanding the foregoing, in the event that any
assignment of rights and obligations of any Defaulting Lender hereunder shall
become effective under applicable law without compliance with the provisions of
this paragraph, then the assignee of such interest shall be deemed to be a
Defaulting Lender for all purposes of this Agreement until such compliance
occurs.

 

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Subject to acceptance and recording thereof by the Administrative Agent pursuant
to Section 9.1(c), and receipt of all requirements under Section 9.1(b)(iv) by
the Administrative Agent, from and after the Administrative Agent has recorded
such Assignment and Acceptance in the Register, the assignee thereunder shall be
a party to this Agreement and, to the extent of the interest assigned by such
Assignment and Acceptance, have the rights and obligations of a Lender under
this Agreement, and the assigning Lender thereunder shall, to the extent of the
interest assigned by such Assignment and Acceptance, be released from its
obligations under this Agreement (and, in the case of an Assignment and
Acceptance covering all of the assigning Lender’s rights and obligations under
this Agreement, such Lender shall cease to be a party hereto) but shall continue
to be entitled to the benefits of Section 2.11, Section 8.1 and Section 8.2 with
respect to facts and circumstances occurring prior to the effective date of such
assignment; provided, that except to the extent otherwise expressly agreed by
the affected parties, no assignment by a Defaulting Lender will constitute a
waiver or release of any claim of any party hereunder arising from that Lender’s
having been a Defaulting Lender. Any assignment or transfer by a Lender of
rights or obligations under this Agreement that does not comply with this
paragraph shall be treated for purposes of this Agreement as a sale by such
Lender of a participation in such rights and obligations in accordance with
Section 9.1(d).

 

(c)          Register. The Administrative Agent, acting solely for this purpose
as a non-fiduciary agent of the Borrower, shall maintain at one of its offices
in Chicago, Illinois a copy of each Assignment and Assumption delivered to it
and a register for the recordation of the names and addresses of the Lenders,
and the Commitments of, and principal amounts (and stated interest) of the Loans
owing to, each Lender pursuant to the terms hereof from time to time (the
“Register”). The entries in the Register shall be conclusive absent manifest
error, and the Borrower, the Administrative Agent and the Lenders shall treat
each Person whose name is recorded in the Register pursuant to the terms hereof
as a Lender hereunder for all purposes of this Agreement. The Register shall be
available for inspection by the Borrower and any Lender, at any reasonable time
and from time to time upon reasonable prior written notice.

 

(d)          Participations.

 

(i)        Any Lender may at any time, sell participations to any Person (other
than a natural Person, or a holding company, investment vehicle or trust for, or
owned and operated for the primary benefit of, a natural Person, or the Borrower
or any of the Borrower’s Affiliates or Subsidiaries) (each, a “Participant”) in
all or a portion of such Lender’s rights and/or obligations under this Agreement
(including all or a portion of its Commitment and/or the Loans owing to it);
provided that (i) such Lender’s obligations under this Agreement shall remain
unchanged, (ii) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations and (iii) the Borrower, the
Administrative Agent and Lenders shall continue to deal solely and directly with
such Lender in connection with such Lender’s rights and obligations under this
Agreement.

 

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(ii)         Any agreement or instrument pursuant to which a Lender sells such a
participation shall provide that such Lender shall retain the sole right to
enforce this Agreement and to approve any amendment, modification or waiver of
any provision of this Agreement; provided that such agreement or instrument may
provide that such Lender will not, without the consent of the Participant, agree
to any amendment, modification or waiver described in Sections 11.2(a)-(i) that
affects such Participant. The Borrower agrees that each Participant shall be
entitled to the benefits of Sections 2.11, 2.16 and 10.11 (subject to the
requirements and limitations therein, including the requirements under Section
10.11 (it being understood that the documentation required under Section 10.11
shall be delivered to the participating Lender)) to the same extent as if it
were a Lender and had acquired its interest by assignment pursuant to paragraph
(b) of this Section; provided that such Participant (A) agrees to be subject to
the provisions of Section 2.16 as if it were an assignee under paragraph (b) of
this Section; and (B) shall not be entitled to receive any greater payment under
Sections 2.11 or 10.11, with respect to any participation, than its
participating Lender would have been entitled to receive, except to the extent
such entitlement to receive a greater payment results from a Change in Law that
occurs after the Participant acquired the applicable participation. To the
extent permitted by law, each Participant also shall be entitled to the benefits
of Section 10.13 as though it were a Lender; provided that such Participant
agrees to be subject to Section 10.13 as though it were a Lender. Each Lender
that sells a participation shall, acting solely for this purpose as a
non-fiduciary agent of the Borrower, maintain a register on which it enters the
name and address of each Participant and the principal amounts (and stated
interest) of each Participant’s interest in the Loans or other obligations under
the Loan Documents (the “Participant Register”); provided that no Lender shall
have any obligation to disclose all or any portion of the Participant Register
(including the identity of any Participant or any information relating to a
Participant’s interest in any commitments, loans, letters of credit or its other
obligations under any Loan Document) to any Person except to the extent that
such disclosure is necessary to establish that such commitment, loan, letter of
credit or other obligation is in registered form under Section 5f.103-1(c) of
the United States Treasury Regulations. The entries in the Participant Register
shall be conclusive absent manifest error, and such Lender shall treat each
Person whose name is recorded in the Participant Register as the owner of such
participation for all purposes of this Agreement notwithstanding any notice to
the contrary. For the avoidance of doubt, the Administrative Agent (in its
capacity as Administrative Agent) shall have no responsibility for maintaining a
Participant Register.

 

(iii)        No consent shall be required for any participation except that the
consent of the Borrower shall be required (such consent not to be unreasonably
conditioned, withheld or delayed); provided that, no consent of the Borrower
shall be required (x) in the event a Default (after expiry of any grace, cure
and notice periods or as further extended with the approval of the Required
Lenders) or an Event of Default has occurred and is continuing at the time of
such participation or (y) if such participation is to a Lender, an Affiliate of
a Lender or an Approved Fund; provided, further, that the Borrower shall be
deemed to have consented to any such participation unless it shall object
thereto by written notice to the Agents within ten (10) Business Days after
having received written notice thereof (which notice shall provide, in bold type
face, that if the Borrower does not object in writing to such participation
within ten (10) Business Days, the Borrower’s consent shall have been deemed to
have been provided).

 

(e)          Certain Pledges. Any Lender may at any time pledge or assign a
security interest in all or any portion of its rights under this Agreement to
secure obligations of such Lender, including any pledge or assignment to secure
obligations to a Federal Reserve Bank; provided that no such pledge or
assignment shall release such Lender from any of its obligations hereunder or
substitute any such pledgee or assignee for such Lender as a party hereto.

 

(f)           Assignments to Borrower and Borrower Affiliates. Notwithstanding
anything in this Agreement to the contrary, any Lender may, at any time, assign
all or a portion of its Loans on a pro rata basis to the Borrower or any
Borrower Affiliate, subject to the following limitations:

 

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(i)          immediately and automatically, without any further action on the
part of the Borrower, any Lender, any Agent or any other Person, upon the
effectiveness of such assignment of Loans from a Lender to the Borrower, such
Loans and all rights and obligations as a Lender related thereto shall, for all
purposes under this Agreement, the other Loan Documents and otherwise, be deemed
to be irrevocably prepaid, terminated, extinguished, cancelled and of no further
force and effect (and which, for the avoidance of doubt, shall not constitute
voluntary or mandatory payments or prepayments for purposes of Section 2.8
hereof) and the Borrower shall neither obtain nor have any rights as a Lender
hereunder or under the other Loan Documents by virtue of such assignment such
purchases (and the payments made by the Borrower and the cancellation of the
purchased Loans, in each case in connection therewith);

 

(ii)         any Borrower Affiliate may, with the consent of the Borrower,
including without limitation, in exchange for Debt or Securities permitted to be
issued, contribute, directly or indirectly, the principal amount of such Loans
or any portion thereof, plus all accrued and unpaid interest thereon, to the
Borrower for the purpose of cancelling and extinguishing such Loans; provided
that, upon the date of such contribution, assignment or transfer, (x) the
aggregate outstanding principal amount of Loans shall reflect such cancellation
and extinguishing of the Loans then held by the Borrower and (y) the Borrower
shall promptly provide written notice to the Agents of such contribution of such
Loans, and the Administrative Agent, upon receipt of such notice, shall reflect
the cancellation of the applicable Loans in the Register;

 

(iii)        (A) for purposes of any consent to any amendment, waiver or
modification of, or any action under, and for the purpose of any direction to
any Agent or any Lender to undertake any action (or refrain from taking any
action) under, this Agreement or any other Loan Document, each applicable
Borrower Affiliate will be deemed to have consented in the same proportion as
the Lenders that are not Borrower Affiliate consented to such matter, unless
such matter requires the consent of all or all affected Lenders and adversely
affects such Borrower Affiliate more than other Lenders in any material respect,
(B) for purposes of voting on any plan of reorganization or plan of liquidation
pursuant to any Debtor Relief Laws (a “Bankruptcy Plan”), each Borrower
Affiliate hereby agrees (x) not to vote on such Bankruptcy Plan, (y) if such
Borrower Affiliate does vote on such Bankruptcy Plan notwithstanding the
restriction in the foregoing clause (x), such vote will be deemed not to be in
good faith and shall be “designated” pursuant to Section 1126(e) of the
Bankruptcy Code (or any similar provision in any other Debtor Relief Laws), and
such vote shall not be counted in determining whether the applicable class has
accepted or rejected such Bankruptcy Plan in accordance with Section 1126(c) of
the Bankruptcy Code (or any similar provision in any other Debtor Relief Laws)
and (z) not to contest any request by any party for a determination by a court
of competent jurisdiction effectuating the foregoing clause (y), in each case
under this clause (B) unless such Bankruptcy Plan adversely affects such
Borrower Affiliate more than other Lenders in any material respect and (C) each
Borrower Affiliate hereby irrevocably appoints the Agents (such appointment
being coupled with an interest) as such Borrower Affiliate’s attorney-in-fact,
with full authority in the place and stead of such Borrower Affiliate and in the
name of such Borrower Affiliate (solely in respect of Loans held by such
Borrower Affiliate and not in respect of any other claim or status such Borrower
Affiliate may otherwise have), from time to time in either Agent’s discretion to
take any action and to execute any instrument that the Agents may deem
reasonably necessary or appropriate to carry out the provisions of this Section
9.1(f)(iv), including to ensure that any vote of such Borrower Affiliate on any
Bankruptcy Plan is withdrawn or otherwise not counted;

 

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(iv)        the Borrower and any Borrower Affiliate shall represent and warrant,
on the date of any such assignment, that neither it, its Affiliates nor any of
its respective directors or officers has any Excluded Information that has not
been disclosed to the Lenders generally (other than to the extent any such
Lender does not wish to receive material non-public information with respect to
the Borrower or its Subsidiaries or any of their respective securities) prior to
such date;

 

(v)         all parties to the relevant transactions shall render customary “big
boy” disclaimer letters; and

 

(vi)        no Event of Default shall have occurred and be continuing before or
immediately after giving effect to such assignment.

 

Article X

 

AGENT; THE LENDER GROUP

 

10.1         Appointment and Authorization of Agent. Effective as of the Closing
Date, each Lender hereby designates and appoints Cortland as the Administrative
Agent and Collateral Agent as their representatives under this Agreement and the
other Loan Documents and each Lender hereby irrevocably authorizes each Agent to
execute and deliver each of the other Loan Documents on its behalf and to take
such other action on its behalf under the provisions of this Agreement and each
other Loan Document and to exercise such powers and perform such duties as are
expressly delegated to each Agent by the terms of this Agreement or any other
Loan Document, together with such powers as are reasonably incidental thereto.
The Agents agree in their respective capacities as Administrative Agent and
Collateral Agent, as applicable, to act as agent for and on behalf of the
Lenders on the express conditions contained in this Article X. The provisions of
this Article X (other than Section 10.9 and Section 10.11) are solely for the
benefit of the Agents, and the Lenders, and the Borrower and its Subsidiaries
shall have no rights as a third party beneficiary of any of the provisions
contained herein. The Agents shall not have any duties or responsibilities,
except those expressly set forth herein, nor shall the Agents have or be deemed
to have any fiduciary relationship with any Lender, and no implied covenants,
functions, responsibilities, duties, obligations or liabilities shall be read
into this Agreement or any other Loan Document or otherwise exist against the
Agents; it being expressly understood and agreed that the use of the word
“Agent” is for convenience only, that the Agents are merely the representative
of the Lenders, and only has the contractual duties set forth herein. Without
limiting the generality of the foregoing, the use of the term “agent” in this
Agreement or the other Loan Documents with reference to Agents is not intended
to connote any fiduciary or other implied (or express) obligations arising under
agency doctrine of any applicable law. Instead, such term is used merely as a
matter of market custom, and is intended to create or reflect only a
representative relationship between independent contracting parties. Each Lender
hereby further authorizes the Collateral Agent to act as the secured party under
each of the Loan Documents that create a Lien on any item of Collateral. Except
as expressly otherwise provided in this Agreement, the Agents shall have and may
use their sole discretion with respect to exercising or refraining from
exercising any discretionary rights or taking or refraining from taking any
actions that the Agents expressly are entitled to take or assert under or
pursuant to this Agreement and the other Loan Documents. Without limiting the
generality of the foregoing, or of any other provision of the Loan Documents
that provides rights or powers to the Agents, the Lenders agree that the Agents
shall have the right to exercise the following powers as long as this Agreement
remains in effect: (a) maintain, in accordance with its customary business
practices, ledgers and records reflecting the status of the Obligations, the
Collateral, the Collections of the Borrower and its Subsidiaries, and related
matters, (b) execute or file any and all financing or similar statements or
notices, amendments, renewals, supplements, documents, instruments, proofs of
claim, notices and other written agreements with respect to the Loan Documents,
(c) make Loans, for itself (to the extent such Agent is also a Lender) or on
behalf of Lenders as provided in the Loan Documents, (d) exclusively receive,
apply, and distribute the Collections of the Borrower and its Subsidiaries as
provided in the Loan Documents, (e) open and maintain such bank accounts and
cash management arrangements as the Agents deem necessary and appropriate in
accordance with the Loan Documents for the foregoing purposes with respect to
the Collateral and the Collections of the Borrower and its Subsidiaries,
(f) perform, exercise, and enforce any and all other rights and remedies of the
Lender Group with respect to the Borrower, the Obligations, the Collateral, the
Collections of the Borrower and its Subsidiaries, or otherwise related to any of
same as provided in the Loan Documents, and (g) incur and pay such Lender Group
Expenses as the Agents may deem necessary or appropriate for the performance and
fulfillment of its functions and powers pursuant to the Loan Documents. At least
three (3) Business Days prior to any Interest Payment Date and with respect to
any other payment in respect of the Loans hereunder, promptly upon receipt of a
prepayment notice from the Borrowers, the Administrative Agent shall provide the
Lenders with a Payment Date Statement relating to such payment to Lenders.

 

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10.2         Delegation of Duties. The Agents may execute any of its duties
under this Agreement or any other Loan Document by or through agents, employees
or attorneys in fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The Agents shall not be responsible for the
negligence or misconduct of any agent or attorney in fact selected by it with
reasonable care except to the extent that a court of competent jurisdiction
determines in a final and nonappealable judgment that the such Agent acted with
gross negligence or willful misconduct in the selection of such sub-agents. In
connection with perfecting its security interest in any Collateral which
constitutes Instruments or certificated Pledged Securities, for so long as
Cortland is the Collateral Agent under this Agreement, it shall appoint (and
maintain an agreement with) a sub-agent who has secure and fire resistant
facilities in accordance with customary standards for custody of Instruments and
certificated Pledged Securities, who shall take possession of the related
Collateral and maintain it in such location for purposes of custodial safe
keeping.

 

10.3         General Immunity.

 

(a)          No Responsibility for Certain Matters. No Agent shall be
responsible to any Lender (or any other Secured Party) for the execution,
effectiveness, genuineness, validity, enforceability, collectability or
sufficiency hereof or any other Loan Document or for any representations,
warranties, recitals or statements made herein or therein or made in any written
or oral statements or in any financial or other statements, instruments, reports
or certificates or any other documents furnished or made by any Agent to the
Lenders (or any other Secured Party) or by or on behalf of any Loan Party to any
Agent or any Lender (or any other Secured Party) in connection with the Loan
Documents and the transactions contemplated thereby or for the financial
condition or business affairs of any Loan Party or any other Person liable for
the payment of any Obligations, nor shall any Agent be required to ascertain or
inquire as to the performance or observance of any of the terms, conditions,
provisions, covenants or agreements contained in any of the Loan Documents or as
to the use of the proceeds of the Loans or as to the existence or possible
existence of any Default or Event of Default or to make any disclosures with
respect to the foregoing. Anything contained herein to the contrary
notwithstanding, the Agents shall not have any liability arising from
confirmations of the amount of outstanding Loans or the component amounts
thereof.

 

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(b)          Exculpatory Provisions. No Agent-Related Person shall be liable for
any action taken or omitted by any Agent under or in connection with any of the
Loan Documents except to the extent caused by such Agent’s gross negligence or
willful misconduct, as determined by a court of competent jurisdiction in a
final, non-appealable order; provided, that any action taken or omitted by any
Agent at the direction of the Required Lenders (or such other Lenders as the
case may be) shall not constitute gross negligence or willful misconduct on the
part of such Agent. Each Agent shall be entitled to refrain from any act or the
taking of any action (including the failure to take an action) in connection
herewith or any of the other Loan Documents or from the exercise of any power,
discretion or authority vested in it hereunder or thereunder unless and until
such Agent shall have received instructions in respect thereof from Required
Lenders (or such other Lenders as may be required to give such instructions
under Section 11.2) and, upon receipt of such instructions from Required Lenders
(or such other Lenders, as the case may be), such Agent shall be entitled to act
or (where so instructed) refrain from acting, or to exercise such power,
discretion or authority, in accordance with such instructions. Without prejudice
to the generality of the foregoing, (i) each Agent shall be entitled to rely,
and shall be fully protected in relying, upon any communication, instrument or
document believed by it to be genuine and correct and to have been signed or
sent by the proper Person or Persons, and shall be entitled to rely and shall be
protected in relying on opinions and judgments of attorneys (who may be
attorneys for the Loan Parties), accountants, experts and other professional
advisors selected by it; and (ii) no party hereto shall have any right of action
whatsoever against any Agent in such capacity as a result of such Agent in such
capacity acting or (where so instructed) refraining from acting hereunder or any
of the other Loan Documents in accordance with the instructions of Required
Lenders (or such other Lenders as may be required to give such instructions
under Section 11.2).

 

10.4         Reliance by Agent. The Agents shall be fully justified in failing
or refusing to take any action under this Agreement or any other Loan Document
unless Agent shall first receive such advice or concurrence of the Lenders as it
deems appropriate and until such instructions are received, the Agents shall
act, or refrain from acting, as it deems advisable. If an Agent so requests, it
shall first be indemnified to its reasonable satisfaction by the Lenders against
any and all liability and expense that may be incurred by it by reason of taking
or continuing to take any such action. The Agents shall in all cases be fully
protected in acting, or in refraining from acting, under this Agreement or any
other Loan Document in accordance with a request or consent of the requisite
Lenders and such request or consent and shall not be liable for any action taken
or not taken by it in accordance with the advice of any such counsel,
accountants or experts.

 

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10.5         Knowledge of Defaults/Events of Default. The Agents shall not be
deemed to have knowledge or notice of the occurrence of any Default and/or Event
of Default, unless the Agents shall have received written notice from a Lender
or the Borrower referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a “notice of default.” The
Administrative Agent will notify the Lenders of its receipt of any such notice.
The Agents shall take such action with respect to such Default and/or Event of
Default in accordance with Article VII; provided that, unless and until the
Agents have received any such direction, the Agents (but shall not be obligated
to) take any action, or refrain from taking any action, with respect to such
Default and/or Event of Default as it shall deem advisable or in the best
interest of the Lenders.

 

10.6         Credit Decision. Each Lender acknowledges that none of the
Agent-Related Persons has made any representation or warranty to it, and that no
act by any Agent hereinafter taken, including any review of the affairs of the
Borrower and its Subsidiaries or Affiliates, shall be deemed to constitute any
representation or warranty by any Agent-Related Person to any Lender. Each
Lender represents to the Agents that it has, independently and without reliance
upon any Agent-Related Person and based on such documents and information as it
has deemed appropriate, made its own appraisal of and investigation into the
business, prospects, operations, property, financial and other condition and
creditworthiness of the Borrower and any other Person party to a Loan Document,
and all applicable bank regulatory laws relating to the transactions
contemplated hereby, and made its own decision to enter into this Agreement and
to extend credit to the Borrower. Each Lender also represents that it will,
independently and without reliance upon any Agent-Related Person and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals and decisions in taking or
not taking action under this Agreement and the other Loan Documents, and to make
such investigations as it deems necessary to inform itself as to the business,
prospects, operations, property, financial and other condition and
creditworthiness of the Borrower and any other Person party to a Loan Document.
Except for notices, reports, and other documents expressly herein required to be
furnished to the Lenders by the Agents, the Agents shall not have any duty or
responsibility to provide any Lender with any credit or other information
concerning the business, prospects, operations, property, financial and other
condition or creditworthiness of the Borrower and any other Person party to a
Loan Document that may come into the possession of any of the Agent-Related
Persons.

 

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10.7         Costs and Expenses; Indemnification. The Agents may incur and pay
Lender Group Expenses to the extent such Agent reasonably deems necessary or
appropriate for the performance and fulfillment of its functions, powers, and
obligations pursuant to the Loan Documents, including court costs, attorneys’
fees and expenses, fees and expenses of financial accountants, advisors,
consultants, and appraisers, costs of collection by outside collection agencies,
auctioneer fees and expenses, and costs of security guards or insurance premiums
paid to maintain the Collateral, whether or not Borrower is obligated to
reimburse the Agents or Lenders for such expenses pursuant to this Agreement or
otherwise. The Agents are authorized and directed to deduct and retain
sufficient amounts from the Collections of the Borrower and its Subsidiaries
received by the Agents to reimburse the Agents for such out-of-pocket costs and
expenses prior to the distribution of any amounts to Lenders. In the event the
Agents are not reimbursed for such costs and expenses by the Borrower or from
the Collections of the Borrower and its Subsidiaries received by the Agents,
each Lender hereby agrees that it is and shall be obligated to pay to or
reimburse the Agents for the amount of such Lender’s Pro Rata Share thereof.
Whether or not the transactions contemplated hereby are consummated, the Lenders
shall indemnify upon demand the Agent-Related Persons (to the extent not
reimbursed by or on behalf of the Borrower and without limiting the obligation
of the Borrower to do so), according to their Pro Rata Shares, from and against,
and the Lenders shall hold each Agent-Related Person harmless from, any and all
Indemnified Liabilities; provided, however, that no Lender shall be liable for
the payment to any Agent-Related Person of any portion of such Indemnified
Liabilities resulting solely from such Person’s gross negligence or willful
misconduct nor shall any Lender be liable for the obligations of any Defaulting
Lender in failing to make a Loan or other extension of credit hereunder. Without
limitation of the foregoing, each Lender shall reimburse the Agents upon demand
for such Lender’s Pro Rata Share of any costs or out of pocket expenses
(including attorneys, accountants, advisors, and consultants fees and expenses)
incurred by any Agent in connection with the preparation, execution, delivery,
administration, modification, amendment, or enforcement (whether through
negotiations, legal proceedings or otherwise) of, or legal advice in respect of
rights or responsibilities under, this Agreement, any other Loan Document, or
any document contemplated by or referred to herein, to the extent that any Agent
is not reimbursed for such expenses by or on behalf of the Borrower; provided,
however, that following the occurrence and continuance of an Event of Default,
to the extent the Agents seek to take an action which will cause them to incur a
cost or expense in excess of $10,000, the Agents shall promptly seek prior
written consent of the Required Lenders with respect to such action. The
undertaking in this Section shall survive the payment of all Obligations
hereunder and the resignation or replacement of any Agent.

 

10.8         Agent in Individual Capacity. The Agents and their Affiliates may
make loans to, accept deposits from, acquire Securities in, and generally engage
in any kind of banking, trust, financial advisory, underwriting, or other
business with Borrower and its Subsidiaries and Affiliates and any other Person
party to any Loan Documents as though the Agents were not Agents hereunder, and,
in each case, without notice to or consent of the other members of the Lender
Group. The other members of the Lender Group acknowledge that, pursuant to such
activities, the Agents or their Affiliates may receive information regarding
Borrower or its Affiliates or Borrower’s external manager and its Affiliates and
any other Person party to any Loan Documents that is subject to confidentiality
obligations in favor of the Borrower or such other Person and that prohibit the
disclosure of such information to the Lenders, and the Lenders acknowledge that,
in such circumstances (and in the absence of a waiver of such confidentiality
obligations, which waiver the Agents will use commercially reasonable efforts to
obtain), the Agents shall not be under any obligation to provide such
information to them. The terms “Lender” and “Lenders” include each Agent in its
individual capacity.

 

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10.9         Successor Agent. 

 

(a)          Any Agent may at any time give notice of its resignation to the
Lenders and the Borrower. At any time, the Agent may be removed by the Required
Lenders or the Borrower, upon thirty (30) days’ prior written notice to such
Agent, the Lenders and the Borrower. Upon receipt of any such notice of
resignation or removal, the Required Lenders shall have the right, in
consultation with the Borrower, to appoint a successor Agent for the Lenders. In
connection with a resignation, if no such successor shall have been so appointed
by the Required Lenders and shall have accepted such appointment within thirty
(30) days after the retiring Agent gives notice of its resignation (or such
earlier date as may be agreed by the Required Lenders) (the “Resignation
Effective Date”), then the retiring Agent may (but shall not be obligated to),
on behalf of the Lenders, appoint a successor Agent meeting the qualifications
set forth above; provided that in no event shall any such successor Agent be a
Defaulting Lender. Whether or not a successor has been appointed, such
resignation shall become effective in accordance with such notice on the
Resignation Effective Date. Upon the occurrence of a Removal Event, an Agent may
be removed upon five (5) Business Days’ prior written notice by the Required
Lenders or the Borrower, delivered to such Agent, the Lenders and the Borrower;
provided, however, that, such removal shall not be effective until a successor
Agent acceptable to the Required Lenders has been selected; provided, further,
that if no such successor Agent has been appointed within thirty (30) days of
such removal, the Required Lenders or the Borrower may petition any court of
competent jurisdiction for the appointment of a successor Agent.

 

(b)          If the Person serving as Agent is a Defaulting Lender pursuant to
clause (d) of the definition thereof, the Required Lenders may, to the extent
permitted by applicable law, by notice in writing to the Borrower and such
Person remove such Person as Agent and, in consultation with the Borrower,
appoint a successor. If no such successor shall have been so appointed by the
Required Lenders and shall have accepted such appointment within thirty (30)
days (or such earlier day as shall be agreed by the Required Lenders) (the
“Removal Effective Date”), then such removal shall nonetheless become effective
in accordance with such notice on the Removal Effective Date.

 

(c)          With effect from the Resignation Effective Date or the Removal
Effective Date (as applicable) (i) the retiring or removed Agent shall be
discharged from its duties and obligations hereunder and under the other Loan
Documents (except that in the case of any collateral security held by the
Collateral Agent on behalf of the Lenders under any of the Loan Documents, the
retiring or removed Collateral Agent shall continue to hold such collateral
security until such time as a successor Collateral Agent is appointed) and (ii)
except for any indemnity payments owed to the retiring or removed Agent, all
payments, communications and determinations provided to be made by, to or
through the Agent shall instead be made by or to each Lender directly, until
such time, if any, as the Required Lenders appoint a successor Agent as provided
for above. Upon the acceptance of a successor’s appointment as an Agent
hereunder, such successor shall succeed to and become vested with all of the
rights, powers, privileges and duties of the retiring or removed Agent (other
than any rights to indemnity payments owed to the retiring or removed Agent),
and the retiring or removed Agent shall be discharged from all of its duties and
obligations hereunder or under the other Loan Documents. The fees payable by the
Borrower to a successor Agent shall be the same as those payable to its
predecessor unless otherwise agreed between the Borrower and such successor.
After the retiring or removed Agent’s resignation or removal hereunder and under
the other Loan Documents, the provisions of this Article X and Section 8.1 shall
continue in effect for the benefit of such retiring or removed Agent, its
sub-agents and their respective Agent-Related Persons in respect of any actions
taken or omitted to be taken by any of them while the retiring or removed Agent
was acting as Agent.

 

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10.10       Lender in Individual Capacity. Any Lender and its respective
Affiliates may make loans to, accept deposits from, acquire Securities in and
generally engage in any kind of banking, trust, financial advisory,
underwriting, or other business with Borrower and its Subsidiaries and
Affiliates and any other Person party to any Loan Documents as though such
Lender were not a Lender hereunder without notice to or consent of the other
members of the Lender Group. The other members of the Lender Group acknowledge
that, pursuant to such activities, such Lender and its respective Affiliates may
receive information regarding Borrower or its Affiliates or Borrower’s external
manager and its Affiliates and any other Person party to any Loan Documents that
is subject to confidentiality obligations in favor of the Borrower or such other
Person and that prohibit the disclosure of such information to the Lenders, and
the Lenders acknowledge that, in such circumstances (and in the absence of a
waiver of such confidentiality obligations, which waiver such Lender will use
commercially reasonable efforts to obtain), such Lender shall not be under any
obligation to provide such information to them.

 

10.11       Withholding Taxes.

 

(a)          Any and all payments made by the Borrower hereunder or under any
note or other Loan Document will be made free and clear of, and without
deduction or withholding for, any present or future Taxes, except as required by
applicable law. If any applicable law (as determined in the good faith
discretion of an applicable Withholding Agent) requires the deduction or
withholding of any Tax from any such payment by a Withholding Agent, then the
applicable Withholding Agent shall be entitled to make such deduction or
withholding and shall timely pay the full amount deducted or withheld to the
relevant Governmental Authority in accordance with applicable law and, if such
Tax is an Indemnified Tax, then the sum payable by the Borrower shall be
increased as necessary so that after such deduction or withholding has been made
(including such deductions and withholdings applicable to additional sums
payable under this Section) the applicable Recipient receives an amount equal to
the sum it would have received had no such deduction or withholding been made.
The Borrower shall timely pay to the relevant Governmental Authority in
accordance with applicable law, or at the option of the Administrative Agent
timely reimburse it for the payment of any Other Taxes. The Borrower will
furnish to the Administrative Agent as soon as practicable after the date the
payment of any Tax is due pursuant to applicable law certified copies of tax
receipts issued by the applicable Governmental Authority evidencing such payment
of such Tax by the Borrower, a copy of the return reporting such payment or
other evidence of such payment reasonably satisfactory to the Administrative
Agent. The Borrower shall indemnify each Recipient, within ten (10) days after
demand therefor, for the full amount of any Indemnified Taxes (including
Indemnified Taxes imposed or asserted on or attributable to an amount payable
under this Section 10.11), payable or paid by such Recipient or required to be
withheld or deducted from a payment to such Recipient and any reasonable
expenses arising therefrom or with respect thereto, whether or not such
Indemnified Taxes were correctly or legally imposed or asserted by the relevant
Governmental Authority. A certificate as to the amount of such payment or
liability delivered to the Borrower by a Lender (with a copy to the
Administrative Agent), or by an Agent on its own behalf or on behalf of a
Lender, shall be conclusive absent manifest error. For purposes of this Section
10.11, the term “applicable law” includes FATCA.

 

(b)          Each Agent shall deliver to the Borrower a properly completed and
executed IRS Form W-9 on or prior to the date it becomes an Agent under this
Agreement and at any other time reasonably requested by the Administrative Agent
or the Borrower. If a Lender is entitled to claim an exemption from, or
reduction of, United States withholding tax, Lender agrees with and in favor of
the Administrative Agent and the Borrower, to deliver to the Administrative
Agent whichever of the following is applicable:

 

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(i)          if such Lender claims an exemption from United States federal
withholding tax pursuant to the portfolio interest exception under Section
881(c) of the Code, (A) a statement of the Lender, signed under penalty of
perjury, that it is not (I) a “bank” as described in Section 881(c)(3)(A) of the
Code, (II) a 10.0% shareholder of the Borrower (within the meaning of Section
881(c)(3)(B) of the Code), or (III) a “controlled foreign corporation” described
in Section 881(c)(3)(C) of the Code, and (B) a properly completed and executed
IRS Form W-8BEN or W-8BEN-E (or successor form), as applicable, on or prior to
the date it becomes a Lender under this Agreement and at any other time
reasonably requested by Administrative Agent or the Borrower;

 

(ii)         if such Lender claims an exemption from, or a reduction of,
withholding tax under an income tax treaty to which the United States is a
party, two properly completed and executed copies of IRS Form W-8BEN or W-8BEN-E
(or successor form), as applicable, on or prior to the date it becomes a Lender
under this Agreement and at any other time reasonably requested by the
Administrative Agent or the Borrower;

 

(iii)        if such Lender claims that interest paid under this Agreement is
exempt from United States withholding tax because it is effectively connected
with a United States trade or business of such Lender, two properly completed
and executed copies of IRS Form W-8ECI (or successor form) (together with
applicable attachments) on or prior to the date it becomes a Lender under this
Agreement and at any other time reasonably requested by the Administrative Agent
or the Borrower;

 

(iv)        two properly completed and executed copies of IRS Form W-8IMY (or
successor form) (together with the relevant documentation under this
Section 10.11(b) and/or any other certification documents from each beneficial
owner, as applicable) on or prior to the date it becomes a Lender under this
Agreement and at any other time reasonably requested by the Administrative Agent
or the Borrower; or

 

(v)         such other form or forms, including IRS Form W-9 (or successor
form), as may be required under the Code or other laws of the United States as a
condition to exemption from, or reduction of, United States withholding or
backup withholding tax on or prior to the date it becomes a Lender under this
Agreement and at any other time reasonably requested by the Administrative Agent
or the Borrower.

 

Each Agent and each such Lender agree to promptly notify, in writing, the
Administrative Agent and the Borrower of any change in circumstances which would
modify or render invalid any claimed exemption or reduction. Each Agent and each
such Lender agree to update any expired, obsolete or inaccurate form provided
pursuant to Section 10.11(b), (c) or (g) or to promptly notify the Borrower and
the Administrative Agent in writing of its legal inability to do so.

 

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(c)          If an Agent or a Lender is entitled to an exemption from, or
reduction of, withholding tax in a jurisdiction other than the United States or
backup withholding, such Agent or such Lender agrees with and in favor of the
Administrative Agent and the Borrower to deliver to the Administrative Agent any
such form or forms as may be required as a condition to exemption from, or
reduction of, foreign withholding or backup withholding tax on or prior to the
date it becomes an Agent or a Lender under this Agreement and at any other time
reasonably requested by the Administrative Agent or the Borrower.

 

Each Agent and each such Lender agrees promptly to notify, in writing, the
Administrative Agent and the Borrower of any change in circumstances which would
modify or render invalid any claimed exemption or reduction.

 

(d)          If any Lender claims exemption from, or reduction of, withholding
tax and such Lender sells, assigns, grants a participation in, or otherwise
transfers all or part of the Obligations of the Borrower, such Lender agrees to
notify the Administrative Agent and the Borrower of the percentage amount in
which it is no longer the beneficial owner of Obligations of the Borrower. To
the extent of such percentage amount, the Administrative Agent and the Borrower
will treat such Lender’s documentation provided pursuant to Sections 10.11(b),
10.11(c) or 10.11(g) as no longer valid. With respect to such percentage amount,
such Lender may provide new documentation, pursuant to Sections 10.11(b),
10.11(c) or 10.11(g), if applicable.

 

(e)          If any Lender is entitled to a reduction in the applicable
withholding tax, the Administrative Agent may withhold from any payment to such
Lender an amount equivalent to the applicable withholding tax after taking into
account such reduction. If the forms or other documentation required by
subsection (b), (c) or (g) of this Section 10.11 are not delivered to the
Administrative Agent, then the Administrative Agent may withhold from any
payment to such Lender not providing such forms or other documentation an amount
equivalent to the applicable withholding tax.

 

(f)           If any party determines, in its sole discretion exercised in good
faith, that it has received a refund of any Taxes as to which it has been
indemnified pursuant to this Section 10.11 (including by the payment of
additional amounts pursuant to this Section 10.11), it shall pay to the
indemnifying party an amount equal to such refund (but only to the extent of
indemnity payments made under this Section 10.11 with respect to the Taxes
giving rise to such refund), net of all out-of-pocket expenses (including Taxes)
of such indemnified party and without interest (other than any interest paid by
the relevant Governmental Authority with respect to such refund). Such
indemnifying party, upon the request of such indemnified party, shall repay to
such indemnified party the amount paid over pursuant to this paragraph (f) (plus
any penalties, interest or other charges imposed by the relevant Governmental
Authority) in the event that such indemnified party is required to repay such
refund to such Governmental Authority. Notwithstanding anything to the contrary
in this paragraph (f), in no event will the indemnified party be required to pay
any amount to an indemnifying party pursuant to this paragraph (f) the payment
of which would place the indemnified party in a less favorable net after-Tax
position than the indemnified party would have been in if the Tax subject to
indemnification and giving rise to such refund had not been deducted, withheld
or otherwise imposed and the indemnification payments or additional amounts with
respect to such Tax had never been paid. This paragraph shall not be construed
to require any indemnified party to make available its Tax returns (or any other
information relating to its Taxes that it deems confidential) to the
indemnifying party or any other Person.

 

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(g)          If a payment made to a Lender under any Loan Document would be
subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to
fail to comply with the applicable reporting requirements of FATCA (including
those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such
Lender shall deliver to the Borrower and the Administrative Agent at the time or
times prescribed by law and at such time or times reasonably requested by the
Borrower or the Administrative Agent such documentation prescribed by applicable
law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such
additional documentation reasonably requested by the Borrower or the
Administrative Agent as may be necessary for the Borrower and the Administrative
Agent to comply with their obligations under FATCA and to determine that such
Lender has complied with such Lender’s obligations under FATCA or to determine
the amount to deduct and withhold from such payment. Solely for purposes of this
Section 10.11(g), “FATCA” shall include any amendments made to FATCA after the
date of this Agreement.

 

(h)          Each party’s obligations under this Section 10.11 shall survive the
resignation or replacement of the Agents or any assignment of rights by, or the
replacement of, a Lender, the termination of the Commitments and the repayment,
satisfaction or discharge of all obligations under any Loan Document.

 

10.12       Collateral and Guarantor Matters.

 

(a)          The Lenders hereby irrevocably authorize the Collateral Agent to,
and the Collateral Agent shall:

 

(i)          release any Lien and/or negative pledge granted pursuant to the
Negative Pledge Agreement, as applicable, on any Asset (including, for the
avoidance of doubt, the Proceeds of such Asset) upon the termination of the
Commitments and payment and satisfaction in full by the Borrower of all
Obligations;

 

(ii)         release any Lien and/or negative pledge granted pursuant to the
Negative Pledge Agreement, as applicable, on any Asset (including, for the
avoidance of doubt, the Proceeds of such Asset), including any Subsidiary of the
Borrower:

 

(A)         (x) in contemplation of the incurrence, assumption or purchase of
Debt pursuant to Section 6.1 (and the imposition of a Permitted Lien pursuant to
Section 6.2) if the Borrower certifies to the Collateral Agent that such Debt is
contemplated to be incurred within fifteen (15) days of the delivery of such
certificate (the “Permitted Debt Certificate”) or (y) in connection with the
incurrence, assumption or purchase of Debt pursuant to Section 6.1 (and the
imposition of a Permitted Lien pursuant to Section 6.2), in each case on such
terms (including, for the avoidance of doubt, in respect to the priority of such
Liens granted, in each case in connection with the incurrence, assumption or
purchase of such Debt) as is reasonably satisfactory to the party incurring,
assuming or acquiring such Debt and the lender of any such Debt; provided
however, if, in the event the Borrower or any of its Subsidiaries does not incur
Debt contemplated by subclause (x) of this clause (A) within fifteen (15) days
of the delivery of the Permitted Debt Certificate, any Lien and/or negative
pledge that was released by the Collateral Agent in connection with such
Permitted Debt Certificate shall be reinstated with respect to such released
Collateral and such Grantor shall deliver such additional pledge and security
documents as the Collateral Agent may reasonably request in order to give effect
to such reinstatement; or

 

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(B)         that is being sold by any Loan Party, any Grantor or any Negative
Pledgor if the Borrower certifies to the Collateral Agent that the Sale is
permitted under Section 6.6 of this Agreement or the other Loan Documents (and
the Collateral Agent may rely conclusively on any such certificate, without
further inquiry); or

 

(iii)        release any Guarantor, Negative Pledgor or Grantor from its
obligations hereunder if the Borrower certifies to the Collateral Agent that
such Guarantor, Negative Pledgor or Grantor is being sold pursuant to a Sale
that is permitted under Section 6.6 of this Agreement or the other Loan
Documents (and the Collateral Agent may rely conclusively on any such
certificate, without further inquiry).

 

(b)          Upon the occurrence of any event set forth in clause (a) above,
(i) each applicable Asset (including, for the avoidance of doubt, the Proceeds
of such Asset) shall automatically, and without further action, be released as
Collateral for all purposes under the Loan Documents; provided however, if, in
the event the Borrower or any of its Subsidiaries does not incur Debt
contemplated by clause (a)(ii)(A)(x) above within fifteen (15) days of the
delivery of the Permitted Debt Certificate, any Collateral that was released
shall be reinstated with respect to such released Collateral and such Grantor
shall deliver such additional pledge and security documents as the Collateral
Agent may reasonably request in order to give effect to such reinstatement and
(ii) upon the request, and at the expense of the Borrower, the Agents agree, as
applicable, to execute and deliver such release documents and take such other
actions to acknowledge, evidence or complete any such release of such Asset or
Person as may be reasonably requested by the Borrower or any of its
Subsidiaries; provided, however, that upon request by the Collateral Agent or
the Borrower or any of its Subsidiaries at any time, the Lenders will confirm in
writing the Collateral Agent’s authority to release any such Liens and/or
negative pledges granted pursuant to the Negative Pledge Agreement, as
applicable, on particular types or items of Assets (including, for the avoidance
of doubt, the Proceeds of such Asset) pursuant to this Section 10.12; provided,
further, that (1) the Collateral Agent shall not be required to execute any
document necessary to evidence such release on terms that, in the Collateral
Agent’s opinion, would expose the Collateral Agent to liability or create any
obligation or entail any consequence other than the release of such Lien without
recourse, representation, or warranty, and (2) such release shall not in any
manner discharge, affect, or impair the Obligations or any Liens (other than
those expressly being released) upon (or obligations of the Borrower or any of
its Subsidiaries in respect of) all interests retained by the Borrower or any of
its Subsidiaries, including, the proceeds of any sale, all of which shall
continue to constitute part of the Collateral.

 

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(c)          The Agents shall have no obligation whatsoever to any of the
Lenders to assure that the Collateral exists or is owned by the Borrower or is
cared for, protected, or insured or has been encumbered, or that the Collateral
Agent’s Liens have been properly or sufficiently or lawfully created, perfected,
protected, or enforced or are entitled to any particular priority, or to
exercise at all or in any particular manner or under any duty of care,
disclosure or fidelity, or to continue exercising, any of the rights,
authorities and powers granted or available to the Agents pursuant to any of the
Loan Documents, it being understood and agreed that in respect of the
Collateral, or any act, omission, or event related thereto, subject to the terms
and conditions contained herein, the Agents may act in any manner it may deem
appropriate, in its sole discretion given the Collateral Agent’s own interest in
the Collateral in its capacity as a Secured Party and that the Agents shall have
no other duty or liability whatsoever to any Lender as to any of the foregoing,
except as otherwise provided herein.

 

10.13       Restrictions on Actions by Lenders; Sharing of Payments.

 

(a)          Each of the Lenders agrees that it shall not, until an Event of
Default has occurred and is continuing, without the express written consent of
the Agents, and that it shall, to the extent it is lawfully entitled to do so,
upon the written request of the Agents, set off against the Obligations, any
amounts owing by such Lender to the Borrower or any deposit accounts of the
Borrower now or hereafter maintained with such Lender. Each of the Lenders
further agrees that it shall not, unless specifically requested to do so in
writing by the Agents (which request shall not be made by the Agents unless an
Event of Default has occurred and is continuing), take or cause to be taken any
action, including, the commencement of any legal or equitable proceedings, to
foreclose any Lien on, or otherwise enforce any security interest in, any of the
Collateral.

 

(b)          If, at any time or times any Lender shall receive (i) by payment,
foreclosure, setoff, or otherwise, any Proceeds of Collateral or any payments
with respect to the Obligations, except for any such proceeds or payments
received by such Lender from the Agents pursuant to the terms of this Agreement,
or (ii) payments from the Agents in excess of such Lender’s ratable portion of
all such distributions by the Agents, such Lender promptly shall (1) turn the
same over to the Agents, in kind, and with such endorsements as may be required
to negotiate the same to the Agents, or in immediately available funds, as
applicable, for the account of all of the Lenders and for application to the
Obligations in accordance with the applicable provisions of this Agreement, or
(2) purchase, without recourse or warranty, an undivided interest and
participation in the Obligations owed to the other Lenders so that such excess
payment received shall be applied ratably as among the Lenders in accordance
with their Pro Rata Shares; provided, however, that to the extent that such
excess payment received by the purchasing party is thereafter recovered from it,
those purchases of participations shall be rescinded in whole or in part, as
applicable, and the applicable portion of the purchase price paid therefor shall
be returned to such purchasing party, but without interest except to the extent
that such purchasing party is required to pay interest in connection with the
recovery of the excess payment.

 

10.14       Agency for Perfection. The Collateral Agent hereby appoints the
Administrative Agent and each other Lender as its agent (and the Administrative
Agent and each Lender hereby accepts such appointment) for the purpose of
perfecting the Collateral Agent’s Liens in assets which, in accordance with
Article 8 or Article 9, as applicable, of the UCC can be perfected only by
possession or control. Should any Lender obtain possession or control of any
such Collateral, such Lender shall notify the Agents thereof in writing, and,
promptly upon either Agent’s request therefor shall deliver possession or
control of such Collateral to the Collateral Agent or in accordance with either
Agent’s instructions.

 

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10.15       Payments by Agent to the Lenders. All payments to be made by the
Agents to the Lenders shall be made by bank wire transfer of immediately
available funds pursuant to such wire transfer instructions as each party may
designate for itself by written notice to the Agents.

 

10.16       Concerning the Collateral and Related Loan Documents. Each member of
the Lender Group authorizes and directs the Agents to enter into this Agreement
and the other Loan Documents. Each member of the Lender Group agrees that any
action taken by the Agents in accordance with the terms of this Agreement or the
other Loan Documents relating to the Collateral and the exercise by the Agents
of their powers set forth therein or herein, together with such other powers
that are reasonably incidental thereto, shall be binding upon all of the
Lenders.

 

10.17       Field Examinations and Examination Reports; Confidentiality;
Disclaimers by Lenders; Other Reports and Information. By becoming a party to
this Agreement, each Lender:

 

(a)          is deemed to have requested that the Agents furnish such Lender,
promptly after it becomes available, (i) a copy of each field examination or
examination report prepared by the Agents, and (ii) a copy of each document
delivered to the Agents pursuant to Sections 5.3(a), (b) and (c) (each a
“Report” and collectively, “Reports”), and the Agents shall so furnish each
Lender with such Reports,

 

(b)          expressly agrees and acknowledges that the Agents do not (i) make
any representation or warranty as to the accuracy of any Report, and (ii) shall
not be liable for any information contained in any Report,

 

(c)          expressly agrees and acknowledges that the Reports are not
comprehensive audits or examinations, that the Agents or other party performing
any examination will inspect only specific information regarding Borrower and
will rely significantly upon the books of the Borrower and the other Loan
Parties, as well as on representations of the Borrower’s personnel,

 

(d)          agrees to keep all Reports and other material, non-public
information regarding Borrower and its Subsidiaries and their operations,
assets, and existing and contemplated business plans in a confidential manner in
accordance with Section 11.12, and

 

(e)          without limiting the generality of any other indemnification
provision contained in this Agreement, agrees: (i) to hold any Agent and any
other Lender preparing a Report harmless from any action the indemnifying Lender
may take or fail to take or any conclusion the indemnifying Lender may reach or
draw from any Report in connection with any loans or other credit accommodations
that the indemnifying Lender has made or may make to the Borrower, or the
indemnifying Lender’s participation in, or the indemnifying Lender’s purchase
of, a loan or loans of the Borrower, and (ii) to pay and protect, and indemnify,
defend and hold any Agent, and any such other Lender preparing a Report harmless
from and against, the claims, actions, proceedings, damages, costs, expenses,
and other amounts (including, attorneys’ fees and costs) incurred by any Agent
and any such other Lender preparing a Report as the direct or indirect result of
any third parties who might obtain all or part of any Report through the
indemnifying Lender.

 

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In addition to the foregoing: (x) any Lender may from time to time request of
the Agent in writing that the Agents provide to such Lender a copy of any report
or document provided by the Borrower to the Agents that has not been
contemporaneously provided by the Borrower to such Lender, and, upon receipt of
such request, the Agents promptly shall provide a copy of same to such Lender,
(y) to the extent that the Agents are entitled, under any provision of the Loan
Documents, to request additional reports or information from Borrower, any
Lender may, from time to time, reasonably request the Agents to exercise such
right as specified in such Lender’s notice to the Agents, whereupon the Agents
promptly shall request of the Borrower the additional reports or information
reasonably specified by such Lender, and, upon receipt thereof from Borrower,
the Agents promptly shall provide a copy of same to such Lender, and (z) any
time that the Administrative Agent renders to the Borrower a statement regarding
the Loan Account, the Administrative Agent shall send a copy of such statement
to each Lender.

 

10.18       Several Obligations; No Liability. Notwithstanding that certain of
the Loan Documents now or hereafter may have been or will be executed only by or
in favor of the Agents in its capacity as such, and not by or in favor of the
Lenders, any and all obligations on the part of any Agent to make any credit
available hereunder shall constitute the several (and not joint) obligations of
the respective Lenders on a ratable basis, according to their respective
Commitments, to make an amount of such credit not to exceed, in principal
amount, at any one time outstanding, the amount of their respective Commitments.
Nothing contained herein shall confer upon any Lender any interest in, or
subject any Lender to any liability for, or in respect of, the business, assets,
profits, losses, or liabilities of any other Lender. Each Lender shall be solely
responsible for notifying its Participants of any matters relating to the Loan
Documents to the extent any such notice may be required, and no Lender shall
have any obligation, duty, or liability to any Participant of any other Lender.
Except as provided in Section 10.7, no member of the Lender Group shall have any
liability for the acts of any other member of the Lender Group. No Lender shall
be responsible to the Borrower or any other Person for any failure by any other
Lender to fulfill its obligations to make credit available hereunder, nor to
take any other action on its behalf hereunder or in connection with the
financing contemplated herein.

 

10.19       [Reserved].

 

10.20       Representations and Warranties of each Agent. Each Agent makes the
following representations and warranties as of the Closing Date:

 

(a)          It is duly organized and existing under the laws of the
jurisdiction of its organization with full power and authority to execute and
deliver this Agreement and to perform all of the duties and obligations to be
performed by it hereunder;

 

(b)          This Agreement will be, legally and validly entered into by such
Agent, does not, and will not, violate any ordinance, charter, by-law, rule or
statute applicable to it, and is enforceable against such Agent in accordance
with its terms, except as may be limited by bankruptcy, insolvency or similar
laws, or by equitable principles relating to or limiting creditors’ rights
generally; and

 

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(c)          The person executing this Agreement on such Agent’s behalf has been
duly and properly authorized to do so.

 

Article XI

MISCELLANEOUS

 

11.1         No Waivers, Remedies. No failure or delay on the part of any Agent
or any Lender, or the holder of any interest in this Agreement in exercising any
right, power, privilege, or remedy under this Agreement or any of the other Loan
Documents shall impair or operate as a waiver thereof, nor shall any single or
partial exercise of any such right, power, privilege, or remedy preclude any
other or further exercise thereof or the exercise of any other right, power,
privilege, or remedy. The waiver of any such right, power, privilege, or remedy
with respect to particular facts and circumstances shall not be deemed to be a
waiver with respect to other facts and circumstances. The remedies provided for
under this Agreement or the other Loan Documents are cumulative and are not
exclusive of any remedies that may be available to any Agent or any Lender, or
the holder of any interest in this Agreement at law, in equity, or otherwise.

 

11.2         Waivers and Amendments. No amendment or waiver of any provision of
this Agreement or any other Loan Document, and no consent with respect to any
departure by the Borrower therefrom, shall be effective unless the same shall be
in writing and signed by the Administrative Agent, Required Lenders (or by the
Agents at the written request of the Required Lenders) and the Borrower and then
any such waiver or consent shall be effective, but only in the specific instance
and for the specific purpose for which given; provided, however, that no such
waiver, amendment, or consent shall:

 

(a)          postpone or delay any date fixed by this Agreement or any other
Loan Document for any payment of principal, interest, fees, or other amounts due
hereunder or under any other Loan Document, without the prior written consent of
each Lender directly and adversely affected thereby,

 

(b)          reduce the principal of, or the rate of interest on, or the Yield
Maintenance Premium, if any, any Loan or other extension of credit hereunder, or
reduce any fees or other amounts payable hereunder or under any other Loan
Document, without the prior written consent of each Lender directly and
adversely affected thereby,

 

(c)          change the Pro Rata Share that is required to take any action
hereunder, without the prior written consent of each Lender,

 

(d)          amend or modify this Section or any provision of the Agreement
providing for consent or other action by all Lenders, without the prior written
consent of each Lender,

 

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(e)          other than as permitted by Section 10.12, release the Collateral
Agent’s Lien in and to any of the Collateral, without the prior written consent
of each Lender,

 

(f)           change the definition of “Required Lenders” or “Pro Rata Share”,
without the prior written consent of each Lender,

 

(g)          other than as permitted by Section 10.12, release any Loan Party
from any obligation for the payment of money, without the prior written consent
of each Lender, or

 

(h)          amend any of the provisions of Article X, without the prior written
consent of each Lender.

 

and, provided further, however, that no amendment, waiver or consent shall,
unless in writing and signed by the Agents, affect the rights or duties of the
Agents under this Agreement or any other Loan Document.

 

Notwithstanding the foregoing, no amendment, termination or waiver of any
provision of the Loan Documents, or consent to any departure by any Loan Party
therefrom, shall be made other than by a solicitation of all Lenders, in a
manner that treats all Lenders in the same manner, and that requires that any
consent fee or other consideration payable in connection therewith be payable
ratably to all Lenders who consent to the requested amendment, termination,
waiver or consent.

 

If, in connection with any proposed amendment, waiver or consent requiring the
consent of “each Lender” or “each Lender directly affected thereby,” the consent
of the Required Lenders is obtained, but the consent of other necessary Lenders
is not obtained (any such Lender whose consent is necessary but not obtained
being referred to herein as a “Non-Consenting Lender”), then the Borrower may at
its sole expense and effort, upon notice to such Lender and the Administrative
Agent, require such Lender to assign and delegate, without recourse (in
accordance with and subject to the restrictions contained in, and consents
required by, Section 9.1), all of its interests, rights (other than its existing
rights to payments pursuant to Section 2.11 or Section 10.11) and obligations
under this Agreement and the related Loan Documents to an Eligible Assignee that
shall assume such obligations (which assignee may be another Lender, if a Lender
accepts such assignment); provided that:

 

(i)          the Borrower shall have paid to the Administrative Agent the
assignment fee (if any) specified in Section 9.1(b)(iv);

 

(ii)         such Lender shall have received payment of an amount equal to the
outstanding principal of its Loans, accrued interest thereon, accrued fees and
all other amounts payable to it hereunder and under the other Loan Documents
from the assignee (to the extent of such outstanding principal and accrued
interest and fees) or the Borrower (in the case of all other amounts);

 

(iii)        in the case of any such assignment resulting from a claim for
compensation under Section 2.11 or payments required to be made pursuant to
Section 10.11, such assignment will result in a reduction in such compensation
or payments thereafter;

 

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(iv)        such assignment does not conflict with applicable law; and

 

(v)         in the case of any assignment resulting from a Lender becoming a
Non-Consenting Lender, the applicable assignee shall have consented to the
applicable amendment, waiver or consent.

 

A Lender shall not be required to make any such assignment or delegation if,
prior thereto, as a result of a waiver by such Lender or otherwise, the
circumstances entitling the Borrower to require such assignment and delegation
cease to apply.

 

11.3         Notices. Except as otherwise provided herein, all notices, demands,
instructions, requests, and other communications required or permitted to be
given to, or made upon, any party hereto shall be in writing and shall be
delivered or sent by registered or certified mail, postage prepaid, return
receipt requested, or by courier or electronic mail (at such email addresses as
a party may designate in accordance herewith) and shall be deemed to be given
for purposes of this Agreement on the day that such writing is received by the
Person to whom it is to be sent pursuant to the provisions of this Agreement.
Unless otherwise specified in a notice sent or delivered in accordance with the
foregoing provisions of this Section 11.3, notices, demands, requests,
instructions, and other communications in writing shall be given to or made upon
the respective parties hereto at their respective addresses indicated on Exhibit
11.3 attached hereto.

 

11.4         Release of Borrowing Base Eligible Assets. Upon receipt by the
Agents of a written notice from the Borrower at least five (5) Business Days
prior to the date that the Borrower wishes to remove an Asset from the pool of
Borrowing Base Eligible Assets (including but not limited to pursuant to Section
10.12 hereof), for all purposes herein, such Asset shall be removed from the
pool of Borrowing Base Eligible Assets for all purposes hereunder upon
satisfaction of the following:

 

(a)          the Borrower shall deliver to the Agents a description of the
relevant Asset to be removed;

 

(b)          the Borrower shall deliver to the Agents a certificate of a
Responsible Officer certifying that on a pro forma basis after giving effect to
such removal, the Borrower is in compliance with the financial covenants set
forth in Section 6.12; and

 

(c)          no Default or Event of Default shall exist or would be caused by
releasing such Asset.

 

11.5         Valuation Confirmation Process. Notwithstanding the foregoing, the
Borrower may, at any time, at Borrower’s expense, retain the Initial Valuation
Agent to undertake a valuation report (the “Valuation Report”) with respect to
any Borrowing Base Eligible Asset, which in the case of a Mortgage Asset, shall
mean the value of the underlying mortgaged property set forth in an updated
appraisal provided by the Initial Valuation Agent (the Assigned Value in such
Valuation Report, the “Initial Valuation”).

 

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(a)          Following the receipt by the Borrower of a Valuation Report (and
delivery of a copy thereof to the Agents), the Assigned Value in respect of the
relevant Borrowing Base Eligible Asset for the purposes of clause (b) of the
definition of “Assigned Value” shall be calculated based on the amount of the
Initial Valuation (in each case, in accordance with the definition of Assigned
Value), unless the Required Agents notify the Borrower in writing (the “Initial
Dispute Notice”) within five (5) Business Days following receipt of such
Valuation Report that the Required Agents dispute the Initial Valuation.

 

(b)          If the Required Lenders, in good faith, dispute the Initial
Valuation as set forth in Section 11.5(a) above, the Borrower and the Required
Lenders shall enter into good faith negotiations for two (2) Business Days to
agree upon an amount that shall be used as the Assigned Value for the relevant
Borrowing Base Eligible Asset.

 

(c)          If the Borrower and the Required Lenders cannot agree upon such
amount, the Borrower and the Required Lenders, at Borrower’s expense, shall
retain the Second Valuation Agent to undertake a valuation report with respect
to the Borrowing Base Eligible Asset, which in the case of a Mortgage Asset,
shall mean the value of the underlying mortgaged property set forth in an
updated appraisal provided by the Second Valuation Agent (the Assigned Value in
such additional valuation report, the “Second Valuation”). Following the receipt
by the Borrower of such additional valuation report (and delivery of a copy
thereof to the Agents) and if the amount of the Second Valuation is no more than
10.0% greater or lesser than the amount of the Initial Valuation, the Assigned
Value in respect of the relevant Borrowing Base Eligible Asset for the purposes
of clause (b) of the definition of “Assigned Value” shall be the amount equal to
the average of the Initial Valuation and the Second Valuation.

 

(d)          If the Second Valuation is more than 10.0% greater or lesser than
the amount of the Initial Valuation and either (i) the Required Agents notify
the Borrower in writing within five (5) Business Days following receipt of such
additional valuation report that the Required Lenders dispute the Second
Valuation or (ii) the Borrower notifies the Agents in writing within five (5)
Business Days following receipt of such additional valuation report that it
disputes the Second Valuation, the Borrower shall retain, at Borrower’s expense,
the Third Valuation Agent that is acceptable to the Required Lenders to
undertake a valuation report with respect to the Borrowing Base Eligible Asset,
which in the case of a Mortgage Asset, shall mean the value of the underlying
mortgaged property set forth in an updated appraisal provided by the Third
Valuation Agent (the Assigned Value in such additional valuation report, the
“Third Valuation”). If the amount of the Third Valuation falls within the range
of the Initial Valuation and the Second Valuation, the Assigned Value for such
Borrowing Base Eligible Asset for the purposes of clause (b) above shall be the
amount of the Third Valuation. If the amount of the Third Valuation falls
outside the range of the Initial Valuation and the Second Valuation, the
Assigned Value in respect of the relevant Borrowing Base Eligible Asset for
purposes of clause (b) of the definition of “Assigned Value” shall be the
average of the Initial Valuation, the Second Valuation and the Third Valuation.
The “Determined Valuation” shall mean the valuation of any Borrowing Base
Eligible Asset pursuant to the process referred to above in these clauses
(a)-(d) (such process, the “Valuation Confirmation Process”); provided, that
with respect to any Borrowing Base Eligible Asset which is a Mortgage Asset
(either at origination or as a result of a modification), the Borrower shall be
required to obtain a valuation of the underlying property as well as such
Mortgage Asset to calculate the Determined Valuation.

 

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It is understood and agreed that, if a Valuation Confirmation Process is
commenced, (i) the Valuation Confirmation Process shall be completed within
thirty (30) days of the delivery of the Initial Dispute Notice, (ii) the Initial
Valuation shall apply for all purposes until the completion of the Valuation
Confirmation Process and (iii) after the completion of the Valuation
Confirmation Process, the Determined Valuation shall apply to such Borrowing
Base Eligible Asset unless (a) the applicable VAE is continuing for a period of
ninety (90) days or more (other than pursuant to clause (vi) of the definition
thereof) or (b) a new VAE has occurred, in which instance the Borrower shall
retain the valuation agent that conducted the Determined Valuation to undertake
an updated valuation (the “Updated Valuation”) for such Borrowing Base Eligible
Asset every ninety (90) days; the value of such Borrowing Base Eligible Asset
shall be as determined in the Updated Valuation, provided, however, that the
Required Lenders shall be entitled to dispute the Updated Valuation, in which
case the Borrower and the Required Lenders shall follow the procedures set forth
in the Valuation Confirmation Process in respect of the Updated Valuation.

 

11.6         Headings. Article and Section headings used in this Agreement and
the table of contents preceding this Agreement are for convenience of reference
only and shall neither constitute a part of this Agreement for any other purpose
nor affect the construction of this Agreement. The foregoing shall apply to each
other Loan Document mutatis mutandis.

 

11.7         Execution in Counterparts; Effectiveness. This Agreement may be
executed in any number of counterparts and by different parties on separate
counterparts, each of which, when executed and delivered, shall be deemed to be
an original, and all of which, when taken together, shall constitute but one and
the same Agreement. Delivery of an executed counterpart of this Agreement by
electronic mail (e.g. .pdf or .tiff) shall be equally as effective as delivery
of an original executed counterpart of this Agreement. Any party delivering an
executed counterpart of this Agreement by electronic mail also shall deliver an
original executed counterpart of this Agreement but the failure to deliver an
original executed counterpart shall not affect the validity, enforceability, and
binding effect of this Agreement. The foregoing shall apply to each other Loan
Document mutatis mutandis.

 

11.8         GOVERNING LAW. EXCEPT AS SPECIFICALLY SET FORTH IN ANY OTHER LOAN
DOCUMENT: (A) THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS SHALL BE DEEMED TO
HAVE BEEN MADE IN THE STATE OF NEW YORK; AND (B) THE VALIDITY OF THIS AGREEMENT
AND THE OTHER LOAN DOCUMENTS, AND THE CONSTRUCTION, INTERPRETATION, AND
ENFORCEMENT HEREOF AND THEREOF, AND THE RIGHTS OF THE PARTIES THERETO SHALL BE
DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE
STATE OF NEW YORK.

 

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11.9         JURISDICTION AND VENUE. TO THE EXTENT THEY MAY LEGALLY DO SO, THE
PARTIES HERETO AGREE THAT ALL ACTIONS, SUITS, OR PROCEEDINGS ARISING BETWEEN ANY
MEMBER OF THE LENDER GROUP OR THE BORROWER AND ITS SUBSIDIARIES IN CONNECTION
WITH THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS SHALL BE TRIED AND LITIGATED
ONLY IN THE STATE OR FEDERAL COURTS LOCATED IN THE COUNTY OF NEW YORK, STATE OF
NEW YORK; PROVIDED HOWEVER THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY
COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT AT ANY AGENT’S OPTION, IN THE COURTS
OF ANY JURISDICTION WHERE ANY AGENT ELECTS TO BRING SUCH ACTION TO THE EXTENT
SUCH COURTS HAVE IN PERSONAM JURISDICTION OVER THE RELEVANT OBLIGOR OR IN REM
JURISDICTION OVER SUCH COLLATERAL OR OTHER PROPERTY. THE BORROWER AND ITS
SUBSIDIARIES AND EACH MEMBER OF THE LENDER GROUP, TO THE EXTENT THEY MAY LEGALLY
DO SO, HEREBY WAIVE ANY RIGHT EACH MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON
CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT IN
ACCORDANCE WITH THIS SECTION 11.9 AND STIPULATE THAT THE STATE AND FEDERAL
COURTS LOCATED IN THE COUNTY OF NEW YORK, STATE OF NEW YORK SHALL HAVE IN
PERSONAM JURISDICTION AND VENUE OVER SUCH PERSON FOR THE PURPOSE OF LITIGATING
ANY SUCH DISPUTE, CONTROVERSY, OR PROCEEDING ARISING OUT OF OR RELATED TO THIS
AGREEMENT OR THE OTHER LOAN DOCUMENTS. TO THE EXTENT PERMITTED BY LAW, SERVICE
OF PROCESS SUFFICIENT FOR PERSONAL JURISDICTION IN ANY ACTION AGAINST BORROWER
OR ANY MEMBER OF THE LENDER GROUP MAY BE MADE BY REGISTERED OR CERTIFIED MAIL,
RETURN RECEIPT REQUESTED, TO ITS ADDRESS INDICATED ON EXHIBIT 11.3 ATTACHED
HERETO.

 

11.10       WAIVER OF TRIAL BY JURY. THE BORROWER AND ITS SUBSIDIARIES AND EACH
MEMBER OF THE LENDER GROUP, TO THE EXTENT THEY MAY LEGALLY DO SO, HEREBY
EXPRESSLY WAIVE ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION, CAUSE
OF ACTION, OR PROCEEDING ARISING UNDER OR WITH RESPECT TO THIS AGREEMENT OR THE
OTHER LOAN DOCUMENTS, OR IN ANY WAY CONNECTED WITH, OR RELATED TO, OR INCIDENTAL
TO, THE DEALINGS OF THE PARTIES HERETO WITH RESPECT TO THIS AGREEMENT OR THE
OTHER LOAN DOCUMENTS, OR THE TRANSACTIONS RELATED HERETO OR THERETO, IN EACH
CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND IRRESPECTIVE OF WHETHER
SOUNDING IN CONTRACT, TORT, OR OTHERWISE. TO THE EXTENT THEY MAY LEGALLY DO SO,
THE BORROWER AND ITS SUBSIDIARIES AND EACH MEMBER OF THE LENDER GROUP HEREBY
AGREE THAT ANY SUCH CLAIM, DEMAND, ACTION, CAUSE OF ACTION, OR PROCEEDING SHALL
BE DECIDED BY A COURT TRIAL WITHOUT A JURY AND THAT ANY PARTY HERETO MAY FILE AN
ORIGINAL COUNTERPART OR A COPY OF THIS SECTION 11.10 WITH ANY COURT AS WRITTEN
EVIDENCE OF THE CONSENT OF THE OTHER PARTY OR PARTIES HERETO TO WAIVER OF ITS OR
THEIR RIGHT TO TRIAL BY JURY.

 

11.11       Independence of Covenants. All covenants under this Agreement and
other Loan Documents shall be given independent effect so that if a particular
action or condition is not permitted by any one covenant, the fact that it would
be permitted by another covenant shall not avoid the occurrence of an Event of
Default or Default if such action is taken or condition exists.

 

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11.12       Confidentiality. Each of the Agents and the Lenders agree to
maintain the confidentiality of the Information (as defined below), except that
Information may be disclosed (a) to its Affiliates and to its Agent-Related
Persons (it being understood that the Persons to whom such disclosure is made
will be informed of the confidential nature of such Information and instructed
to keep such Information confidential); (b) to the extent required or requested
by any regulatory authority purporting to have jurisdiction over such Person or
its Agent-Related Persons (including any self-regulatory authority, such as the
National Association of Insurance Commissioners); (c) to the extent required by
applicable laws or regulations or by any subpoena or similar legal process (in
which case such Person shall notify the Borrower (except in the case of a
non-targeted, routine audit or review) as soon as practicable in the event of
such disclosure by such Person unless such notification is prohibited by law,
rule or regulation; provided that, such Person shall not have any liability for
failure to provide such notice); (d) to any other party hereto; (e) in
connection with the exercise of any remedies hereunder or under any other Loan
Document or any action or proceeding relating to this Agreement or any other
Loan Document or the enforcement of rights hereunder or thereunder; (f) subject
to an agreement containing provisions substantially the same as those of this
Section 11.12, to (i) any Eligible Assignee of or Participant in, or any
prospective assignee of or Participant in, any of its rights and obligations
under this Agreement, or (ii) any actual or prospective party (or its
Agent-Related Persons) to any swap, derivative or other transaction under which
payments are to be made by reference to the Borrower and its obligations, this
Agreement or payments hereunder; (g) on a confidential basis to (i) any rating
agency in connection with rating the Borrower or its Subsidiaries or the
Facilities or (ii) the CUSIP Service Bureau or any similar agency in connection
with the issuance and monitoring of CUSIP numbers with respect to the
Facilities; (h) with the consent of the Borrower; or (i) to the extent such
Information (x) becomes publicly available other than as a result of a breach of
this Section 11.12 or (y) becomes available to the Agents, any Lender or any of
their respective Affiliates on a nonconfidential basis from a source other than
the Borrower. In addition, the Agents and the Lenders may disclose the existence
of this Agreement and information about this Agreement to market data
collectors, similar service providers to the lending industry and service
providers to the Agents and the Lenders in connection with the administration of
this Agreement, the other Loan Documents, and the Commitments.

 

For purposes of this Section, “Information” means all information received from
the Borrower or any of its Subsidiaries relating to the Borrower or any of its
Subsidiaries or any of their respective businesses, other than any such
information that is available to the Agents or any Lender prior to disclosure by
the Borrower or any of its Subsidiaries. Any of the Lenders on the Closing Date
shall be considered to have complied with its obligation to maintain the
confidentiality of Information as provided in this Section if such Person has
exercised the same degree of care to maintain the confidentiality of such
Information as such Person would accord to its own confidential information.

 

11.13       Complete Agreement. This Agreement, together with the schedules and
exhibits hereto and the other Loan Documents is intended by the parties hereto
as a final expression of their agreement and is intended as a complete statement
of the terms and conditions of their agreement with respect to the subject
matter of this Agreement and shall not be contradicted or qualified by any other
agreement, oral or written, before the date hereof.

 

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11.14       Severability. If any term, provision, covenant or restriction of
this Agreement is held by a court of competent jurisdiction or other
Governmental Authority to be invalid, void or unenforceable, the remainder of
the terms, provisions, covenants and restrictions of this Agreement shall remain
in full force and effect and shall in no way be affected, impaired or
invalidated so long as the economic or legal substance of the transactions
contemplated hereby is not affected in any manner materially adverse to any
party. Upon such a determination, the parties shall negotiate in good faith to
modify this Agreement so as to effect the original intent of the parties as
closely as possible in an acceptable manner in order that the transactions
contemplated hereby be consummated as originally contemplated to the fullest
extent possible.

 

11.15       PATRIOT Act Notice. Each Lender hereby notifies the Borrower that
pursuant to the requirements of the PATRIOT Act, it may be required to obtain,
verify and record information that identifies the Borrower, which information
includes the name and address of the Borrower and other information that will
allow such Lender to identify the Borrower in accordance with the PATRIOT Act.

 

Article XII

THE GUARANTY

 

12.1         The Guarantee.

 

(a)          The Guarantors hereby, jointly and severally, guarantee to each
Secured Party as hereinafter provided, as primary obligor and not merely as
surety, the payment of the Secured Obligations in full in cash when due (whether
at stated maturity, as a mandatory prepayment, by acceleration, as a mandatory
cash collateralization or otherwise) strictly in accordance with the terms
thereof. Each Guarantor hereby further jointly and severally agrees that if any
of the Secured Obligations are not paid in full in cash when due (whether at
stated maturity, as a mandatory prepayment, by acceleration, as a mandatory cash
collateralization or otherwise), each Guarantor will promptly pay the same,
without any demand or notice whatsoever, and that in the case of any extension
of time of payment or renewal of any of the Secured Obligations, the same will
be promptly paid in full in cash when due (whether at extended maturity, as a
mandatory prepayment, by acceleration, as a mandatory cash collateralization or
otherwise) in accordance with the terms of such extension or renewal.

 

(b)          Each Guarantor, and by its acceptance of this Guaranty, the Agents
and each other Secured Party, hereby confirms that it is the intention of all
such Persons that this Guaranty and the Obligations of each Guarantor hereunder
not constitute a fraudulent transfer or conveyance for purposes of any Debtor
Relief Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent
Transfer Act or any similar foreign, federal or state law to the extent
applicable to this Guaranty and the Obligations of each Guarantor hereunder. To
effectuate the foregoing intention, the Agents, the other Secured Parties and
the Guarantors hereby irrevocably agree that the Obligations of each Guarantor
under this Guaranty at any time shall be limited to the maximum amount as will
result in the Obligations of such Guarantor under this Guaranty not constituting
a fraudulent transfer or conveyance under applicable law after giving full
effect to such Guarantor’s contribution rights but before taking into account
any liabilities of such Guarantor under any other guarantee of such Guarantor
other than any other guarantee of any obligations that are secured on a pari
passu basis with the Obligations.

 

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12.2         Obligations Unconditional.

 

(a)          The obligations of the Guarantors under Section 12.1 are absolute
and unconditional, irrespective of the value, genuineness, validity, regularity
or enforceability of any of the Loan Documents or other documents relating to
the Secured Obligations, or any substitution, release, impairment or exchange of
any other guarantee of or security for any of the Secured Obligations, and, to
the fullest extent permitted by applicable law, irrespective of any other
circumstance whatsoever which might otherwise constitute a legal or equitable
discharge or defense of a surety or guarantor (other than payment in full in
cash of the Secured Obligations, other than Obligations (or any portion thereof)
that are contingent in nature and for which no claim has been made
(“Unliquidated Obligations”)), it being the intent of this Section 12.2 that the
obligations of the Guarantors hereunder shall be absolute and unconditional
under any and all circumstances. Each Guarantor agrees that it shall have no
right of subrogation, indemnity, reimbursement or contribution against any other
Guarantor for amounts paid under this Article XII until such time as the Secured
Obligations (other than Unliquidated Obligations) have been indefeasibly paid in
full in cash and the Commitments have expired or terminated.

 

Without limiting the generality of the foregoing, it is agreed that, to the
fullest extent permitted by law, the occurrence of any one or more of the
following shall not alter or impair the liability of any Guarantor hereunder,
which shall remain absolute and unconditional as described above:

 

(b)          at any time or from time to time, without notice to any Guarantor,
the time for any performance of or compliance with any of the Secured
Obligations shall be extended, or such performance or compliance shall be
waived;

 

(c)          the maturity of any of the Secured Obligations shall be
accelerated, or any of the Secured Obligations shall be modified, supplemented
or amended in any respect, or any right under any of the Loan Documents or other
documents relating to the Secured Obligations shall be waived or any other
guarantee of any of the Secured Obligations or any security therefor shall be
released, impaired or exchanged in whole or in part or otherwise dealt with;

 

(d)          any Lien granted to, or in favor of, the Collateral Agent or any
other holder of the Secured Obligations as security for any of the Secured
Obligations shall fail to attach or be perfected; or

 

(e)          any of the Secured Obligations shall be determined to be void or
voidable (including, without limitation, for the benefit of any creditor of any
Guarantor) or shall be subordinated to the claims of any Person (including,
without limitation, any creditor of Guarantor).

 

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(f)          any failure or omission to assert or enforce or agreement or
election not to assert or enforce, delay in enforcement, or the stay or
enjoining, by order of court, by operation of law or otherwise, of the exercise
or enforcement of, any claim or demand or any right, power or remedy (whether
arising under any Loan Document at law, in equity or otherwise) with respect to
the Secured Obligations or any agreement relating thereto, or with respect to
any other guaranty of or security for the payment of the Secured Obligations;

 

(g)          any exercise of remedies with respect to any security for the
Secured Obligations (including, without limitation, any collateral, including
the Collateral, securing or purporting to secure any of the Secured Obligations)
at such time and in such order and in such manner as the Agents and the Secured
Parties may decide and whether or not every aspect thereof is commercially
reasonable and whether or not such action constitutes an election of remedies
and even if such action operates to impair or extinguish any right of
reimbursement or subrogation or other right or remedy that any Guarantor would
otherwise have, and without limiting the generality of the foregoing or any
other provisions hereof, each Guarantor hereby expressly waives any and all
benefits which might otherwise be available to such Guarantor under applicable
law;

 

(h)          any other circumstance whatsoever which may or might in any manner
or to any extent vary the risk of any Guarantor as an obligor in respect of the
Secured Obligations or which constitutes, or might be construed to constitute,
an equitable or legal discharge of the Borrower or any other Guarantor for the
Secured Obligations, or of such Guarantor under the guarantee contained in this
Article XII or of any security interest granted by any Guarantor, whether in an
Insolvency Proceeding or in any other instance; or

 

(i)          with respect to its obligations hereunder, each Guarantor hereby
expressly waives diligence, presentment, demand of payment, protest and all
notices whatsoever, and any requirement that the Agents or any other holder of
the Secured Obligations exhaust any right, power or remedy or proceed against
any Person under any of the Loan Documents or other documents relating to the
Secured Obligations, or against any other Person under any other guarantee of,
or security for, any of the Secured Obligations.

 

12.3         Reinstatement. The obligations of each Guarantor under this Article
XII shall be automatically reinstated if and to the extent that for any reason
any payment by or on behalf of any Person in respect of the Secured Obligations
is rescinded or must be otherwise restored by any holder of any of the Secured
Obligations, whether as a result of any proceedings under any Debtor Relief Law,
and each Guarantor agrees that it will jointly and severally indemnify the
Agents and each holder of the Secured Obligations on demand for all reasonable
costs and expenses (including, without limitation, the fees, charges and
disbursements of one counsel for the Agents, taken as a whole, and one counsel
for the holders of any Secured Obligations, taken as a whole) incurred by the
Agents or such holders of the Secured Obligations in connection with such
rescission or restoration, including any such costs and expenses incurred in
defending against any claim alleging that such payment constituted a preference,
fraudulent transfer or similar payment under any proceedings under any Debtor
Relief Law.

 

12.4         Certain Additional Waivers. Each Guarantor further agrees that it
shall have no right of recourse to security for the Secured Obligations, except
through the exercise of rights of subrogation pursuant to Section 12.2 and
through the exercise of rights of contribution pursuant to Section 12.6.

 

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12.5         Remedies. Each Guarantor agrees that, to the fullest extent
permitted by law, as between the Guarantors, on the one hand, and the Agents and
the other holders of the Secured Obligations, on the other hand, the Secured
Obligations may be declared to be forthwith due and payable as provided in
Article VII (and shall be deemed to have become automatically due and payable in
the circumstances provided in said Article VII) for purposes of Section 12.1
notwithstanding any stay, injunction or other prohibition preventing such
declaration (or preventing the Secured Obligations from becoming automatically
due and payable) as against any other Person and that, in the event of such
declaration (or the Secured Obligations being deemed to have become
automatically due and payable), the Secured Obligations (whether or not due and
payable by any other Person) shall forthwith become due and payable by each
Guarantor for purposes of Section 12.1. Each Guarantor acknowledges and agrees
that its respective obligations hereunder are secured in accordance with the
terms of the Loan Documents and that the holders of the Secured Obligations may
exercise their remedies thereunder in accordance with the terms thereof.

 

12.6         Rights of Contribution. Each Guarantor agrees that, in connection
with payments made hereunder, each Guarantor shall have contribution rights
against the other Guarantors as permitted under applicable law. Such
contribution rights shall be subordinate and subject in right of payment to the
obligations of such Guarantors under the Loan Documents and no Guarantor shall
exercise such rights of contribution until all Secured Obligations (other than
Unliquidated Obligations) have been indefeasibly paid in full in cash and the
Commitments have terminated.

 

12.7         Guaranty of Payment; Continuing Guarantee. The guarantee given by
each Guarantor in this Article XII is a guaranty of payment and not of
collection, is a continuing guarantee, and shall apply to all Secured
Obligations whenever arising.

 

12.8         Representations and Warranties of each Guarantor. Each Guarantor
hereby (i) represents and warrants to each Agent and each Lender as to itself
that all representations and warranties relating to it contained in this
Agreement and the Loan Documents are true and correct as of the date hereof and
(ii) further represents and warrants to Agents and each Lender as of the date
hereof that:

 

(a)          Such Guarantor has received, or will receive, direct or indirect
benefit from the making of this Agreement with respect to the Secured
Obligations;

 

(b)          Such Guarantor is duly organized, validly existing and in good
standing under the laws of its jurisdiction of formation;

 

(c)          Such Guarantor has the requisite corporate power and authority to
issue this Agreement and to perform its obligations hereunder, and has duly
authorized, executed and delivered this Agreement;

 

(d)          Such Guarantor is not required to obtain any authorization,
consent, approval, exemption or license from, or to file any registration with,
any government authority as a condition to the validity of, or to the execution,
delivery or performance of, this Agreement;

 

 - 104 - 

 

 

(e)          There is no action, suit or proceeding pending or threatened in
writing against Guarantor before any court or arbitrator or any governmental
body, agency or official in which there is a reasonable possibility of an
adverse decision which could affect, in a materially adverse manner, the ability
of Guarantor to perform any of its obligations under, or which in any manner
questions the validity of, this Agreement;

 

(f)          The execution, delivery and performance of this Agreement by
Guarantor does not contravene or constitute a default under any provision of
Guarantor’s certificate of incorporation or by-laws or any material contractual
restriction binding on Guarantor, and to the best of Guarantor’s knowledge does
not contravene or constitute a default under any statue, regulation or rule of
any governmental authority;

 

(g)         This Agreement constitutes the legal, valid and binding obligation
of Guarantor enforceable in accordance with its terms, subject to the effect of
any bankruptcy, insolvency, reorganization, moratorium or similar law affecting
creditors' rights generally, and to general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law);
and

 

(h)          Guarantor is familiar with, and has independently reviewed books
and records regarding, the financial condition of Borrower and is familiar with
the value of any and all collateral intended to be created as security for the
payment of the Secured Obligations; however, Guarantor is not relying on such
financial condition or the collateral as an inducement to enter into this
Agreement.

 

[Signature pages to follow.]

 

 - 105 - 

 

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
and delivered as of the date first set forth above.

 

  HUNT COMPANIES FINANCE TRUST, INC.,   a Maryland corporation, as Borrower    
  By: /s/ Michael Larsen   Name: Michael Larsen   Title: President       FIVE
OAKS ACQUISITION CORP.,   a Delaware corporation, as Guarantor       By: /s/
Michael Larsen   Name: Michael Larsen   Title: President       HUNT CMT EQUITY,
LLC,   a Delaware limited liability company, as Guarantor       By: /s/ Michael
Larsen   Name: Michael Larsen   Title: President

 

 

 

 

  CORTLAND CAPITAL MARKET SERVICES   LLC,   as Administrative Agent and
Collateral Agent,       By: /s/ Emily Ergang Pappas   Name: Emily Ergang Pappas
  Title: Associate Counsel

 

 

 

 

  Jefferies Leveraged Credit Products, LLC,   as Initial Lender       By: /s/
William P. McLoughlin   Name: William P. McLoughlin   Title: SVP

 

 

 

 

ANNEX A

 

Lender Commitments

 

Initial Lender Commitment     Jefferies Leveraged Credit Products, LLC
$40,250,000

 

 

 

 

 

Execution Version

 

EXHIBIT A-1

 

FORM OF ASSIGNMENT AND ACCEPTANCE AGREEMENT

 

This ASSIGNMENT AND ACCEPTANCE AGREEMENT (“Assignment Agreement”) is dated as of
the Effective Date set forth below and is entered into by and between
[the][each]1 Assignor identified in item 1 below ([the][each, an] “Assignor”)
and [the][each]2 Assignee identified in item 2 below ([the][each, an]
“Assignee”). [It is understood and agreed that the rights and obligations of
[the Assignors][the Assignees]3 hereunder are several and not joint.]4
Capitalized terms used but not defined herein shall have the meanings given to
them in the Credit Agreement identified below (as amended, the “Credit
Agreement”), receipt of a copy of which is hereby acknowledged by [the][each]
Assignee. The Standard Terms and Conditions set forth in Annex 1 attached hereto
are hereby agreed to and incorporated herein by reference and made a part of
this Assignment Agreement as if set forth herein in full.

 

For an agreed consideration, [the][each] Assignor hereby irrevocably sells and
assigns to [the Assignee][the respective Assignees], and [the][each] Assignee
hereby irrevocably purchases and assumes from [the Assignor][the respective
Assignors], subject to and in accordance with the Standard Terms and Conditions
and the Credit Agreement, as of the Effective Date inserted by the
Administrative Agent as contemplated below (i) all of [the Assignor’s][the
respective Assignors’] rights and obligations in [its capacity as a
Lender][their respective capacities as Lenders] under the Credit Agreement and
any other documents or instruments delivered pursuant thereto to the extent
related to the amount and percentage interest identified below of all of such
outstanding rights and obligations of [the Assignor][the respective Assignors]
under the respective facilities identified below (including without limitation
any guarantees included in such facilities), and (ii) to the extent permitted to
be assigned under applicable law, all claims, suits, causes of action and any
other right of [the Assignor (in its capacity as a Lender)][the respective
Assignors (in their respective capacities as Lenders)] against any Person,
whether known or unknown, arising under or in connection with the Credit
Agreement, any other documents or instruments delivered pursuant thereto or the
loan transactions governed thereby or in any way based on or related to any of
the foregoing, including, but not limited to, 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 assigned pursuant to clause (i)
above (the rights and obligations sold and assigned by [the][any] Assignor to
[the][any] Assignee pursuant to clauses (i) and (ii) above being referred to
herein collectively as [the][an] “Assigned Interest”). Each such sale and
assignment is without recourse to [the][any] Assignor and, except as expressly
provided in this Assignment Agreement, without representation or warranty by
[the][any] Assignor.

 

 

1 For bracketed language here and elsewhere in this form relating to the
Assignor(s), if the assignment is from a single Assignor, choose the first
bracketed language. If the assignment is from multiple Assignors, choose the
second bracketed language.

 

2 For bracketed language here and elsewhere in this form relating to the
Assignee(s), if the assignment is to a single Assignee, choose the first
bracketed language. If the assignment is to multiple Assignees, choose the
second bracketed language.

 

3 Select as appropriate.

 

4 Include bracketed language if there are either multiple Assignors or multiple
Assignees.

 

 

 

 

1. Assignor[s]:                             2. Assignee[s]:                    
  [Assignee is an [Affiliate][Approved Fund] of [identify Lender]

 

3. Borrower: HUNT COMPANIES FINANCE TRUST, INC., a Maryland corporation       4.
Administrative Agent: Cortland Capital Market Services LLC, as the
Administrative Agent       5. Credit Agreement: The Credit and Guaranty
Agreement dated as of January [__], 2019, by and among Hunt Companies Finance
Trust, Inc., as Borrower, Five Oaks Acquisition Corp. and Hunt CMT Equity, LLC,
as Guarantors, the Lenders parties thereto from time to time, and Cortland
Capital Market Services LLC, as Administrative Agent and Collateral Agent

 

6. Assigned Interest[s]:

 

Assignor[s]5  Assignee[s]6  Facility
Assigned7  Aggregate Amount of
Commitment/Loans
for all Lenders   Amount of
Commitment/Loans
Assigned8   Percentage
Assigned of
Commitment/
Loans8   CUSIP
Number          $                     $                    
                   %             $    $      %             $    $      %   

 

 

5 List each Assignor, as appropriate.

 

6 List each Assignee, as appropriate.

 

7 Designate type of interest being assigned – Initial Term Loan or Incremental
Term Loan.

 

8 Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans of
all Lenders thereunder.

 

 EXHIBIT A-1-2 

 

 

Effective Date: _________ ___, 20[__]9

 

The terms set forth in this Assignment and Acceptance Agreement are hereby
agreed to:

 

  [NAME OF ASSIGNOR], as Assignor         By:       Name:     Title:       [NAME
OF ASSIGNEE], as Assignee         By:        Name:     Title:

 

ACCEPTED [AND CONSENTED]10 THIS ____ DAY OF _______________, 20__       CORTLAND
CAPITAL MARKET SERVICES LLC, as Administrative Agent         By:       Name:    
Title:       [CONSENTED TO THIS ____ DAY OF   ______________, 20__       HUNT
COMPANIES FINANCE TRUST, INC.,   a Maryland corporation,   as Borrower        
By:                                Name:       Title:     ]11          

 

 

9 To be inserted by Administrative Agent and which shall be the effective date
of recordation of transfer in the Register therefor.

 

10 Include to the extent required by Section 9.1(b)(iii)(B) of the Credit
Agreement.

 

11 Include to the extent required by Section 9.1(b)(iii) of the Credit
Agreement.

 

 EXHIBIT A-1-3 

 

 

ANNEX I

 

ANNEX FOR ASSIGNMENT AND ACCEPTANCE AGREEMENT

 

STANDARD TERMS AND CONDITIONS FOR

 

ASSIGNMENT AGREEMENT

 

1.            Representations and Warranties.

 

1.1           Assignor[s]. [The][Each] Assignor (a) represents and warrants that
(i) it is the legal and beneficial owner of [the][the relevant] Assigned
Interest, (ii) [the][such] Assigned Interest is free and clear of any lien,
encumbrance or other adverse claim, (iii) it has full power and authority, and
has taken all action necessary, to execute and deliver this Assignment Agreement
and to consummate the transactions contemplated hereby and (iv) it is not a
Defaulting Lender; and (b) assumes no responsibility with respect to (i) any
statements, warranties or representations made in or in connection with the
Credit Agreement or any other Loan Document, (ii) the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Loan
Documents or any collateral thereunder, (iii) the financial condition of the
Borrower, any of its Subsidiaries or Affiliates or any other Person obligated in
respect of any Loan Document, or (iv) the performance or observance by the
Borrower, any of its Subsidiaries or Affiliates or any other Person of any of
their respective obligations under any Loan Document.

 

1.2           Assignee[s]. [The][Each] Assignee (a) represents and warrants that
(i) it has full power and authority, and has taken all action necessary, to
execute and deliver this Assignment Agreement and to consummate the transactions
contemplated hereby and to become a Lender under the Credit Agreement, (ii) it
meets all the requirements to be an assignee under Section 9.1 of the Credit
Agreement (subject to such consents, if any, as may be required thereunder),
(iii) from and after the Effective Date, it shall be bound by the provisions of
the Credit Agreement as a Lender thereunder and, to the extent of [the][the
relevant] Assigned Interest, shall have the obligations of a Lender thereunder,
(iv) it is sophisticated with respect to decisions to acquire assets of the type
represented by the Assigned Interest and either it, or the Person exercising
discretion in making its decision to acquire the Assigned Interest, is
experienced in acquiring assets of such type, (v) it has received a copy of the
Credit Agreement, and has received or has been accorded the opportunity to
receive copies of the most recent financial statements delivered pursuant to
Section 5.2 thereof and such other documents and information as it deems
appropriate to make its own credit analysis and decision to enter into this
Assignment Agreement and to purchase [the][such] Assigned Interest, (vi) it has,
independently and without reliance upon the Administrative Agent or any other
Lender and based on such documents and information as it has deemed appropriate,
made its own credit analysis and decision to enter into this Assignment
Agreement and to purchase [the][such] Assigned Interest, and (vii) if it is not
a Lender, Assignee has delivered to Administrative Agent all documentation and
other information required by regulatory authorities under applicable “know your
customer” and anti-money laundering rules and regulations, including, without
limitation, the PATRIOT Act, and (viii) if it is a foreign Lender attached to
the Assignment Agreement is any documentation required to be delivered by it
pursuant to the terms of the Credit Agreement, duly completed and executed by
[the][such] Assignee; and (b) agrees that (i) it will, independently and without
reliance on the Administrative Agent, [the][any] Assignor or any other Lender,
and based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under the Loan Documents, and (ii) it will perform in accordance with their
terms all of the obligations which by the terms of the Loan Documents are
required to be performed by it as a Lender.

 

 EXHIBIT A-1-4 

 

 

2.            Payments. From and after the Effective Date, the Administrative
Agent shall make all payments in respect of [the][each] Assigned Interest
(including payments of principal, interest, fees and other amounts) to [the][the
relevant] Assignor for amounts which have accrued to but excluding the Effective
Date and to [the][the relevant] Assignee for amounts which have accrued from and
after the Effective Date. Notwithstanding the foregoing, the Administrative
Agent shall make all payments of interest, fees or other amounts paid or payable
in kind from and after the Effective Date to [the][the relevant] Assignee.

 

3.             General Provisions. This Assignment Agreement shall be binding
upon, and inure to the benefit of, the parties hereto and their respective
successors and assigns. This Assignment Agreement may be executed in any number
of counterparts, which together shall constitute one instrument. Delivery of an
executed counterpart of a signature page of this Assignment Agreement by
telecopy shall be effective as delivery of a manually executed counterpart of
this Assignment Agreement.

 

4.             THIS ASSIGNMENT AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

 EXHIBIT A-1-5 

 

 

EXHIBIT A-2

 

(FORM OF SECURED PROMISSORY NOTE FOR LOANS)

 

SECURED PROMISSORY NOTE FOR LOANS

 

$_____________________ As of _____________ __, 20__ Secured Promissory Note No.
___  

 

FOR VALUE RECEIVED, the undersigned (the “Borrower”), hereby promises to pay to
the order of ___________________, a ___________________ (hereinafter, “Lender”),
such payment to be made to Administrative Agent for the account of Lender, in
such coin or currency of the United States which shall be legal tender in
payment of all debts and dues, public and private, at the time of payment, the
principal sum of $______________ or, if less, the aggregate unpaid principal
amount of all Loans made by the Lender pursuant to the Credit Agreement (as
defined below), payable as set forth in the Credit Agreement.

 

This Secured Promissory Note for Loans (this “Note”) is one of a series of the
promissory notes referred to in, and is issued pursuant to, that certain Credit
Agreement, dated as of January [__], 2019 (as amended, restated, supplemented,
amended and restated or otherwise modified from time to time, the “Credit
Agreement”), among Hunt Companies Finance Trust, Inc. (the “Borrower”), Five
Oaks Acquisition Corp., a Delaware corporation, Hunt CMT Equity, LLC, a Delaware
limited liability company, the lenders party thereto (such lenders, together
with their respective successors and permitted assigns, are referred to
hereinafter each individually as a “Lender” and collectively as the “Lenders”),
and Cortland Capital Market Services LLC, as administrative agent and collateral
agent for the Lenders. Unless otherwise defined herein or the context otherwise
requires, terms used herein or in any of the attachments hereto have the
meanings provided in the Credit Agreement. This Note evidences certain Loans
incurred under the Credit Agreement.

 

This Note is secured and guaranteed as provided in the Credit Agreement and the
Loan Documents. Reference is hereby made to the Credit Agreement and the Loan
Documents for a description of the properties and assets in which a security
interest has been granted, the nature and extent of the security and guarantees,
the terms and conditions upon which the security interest and each guarantee was
granted and the rights of the holder of this Note in respect thereof.

 

All interest shall be computed in the manner provided in Article II of the
Credit Agreement. Upon the occurrence and during the continuation of an Event of
Default, the interest rate provided herein may be increased set forth in the
Credit Agreement.

 

The principal amount and accrued interest of this Note shall be due and payable
in accordance with the Credit Agreement. Notwithstanding the foregoing, the
entire unpaid principal balance hereof and accrued interest thereon shall be due
and payable immediately upon any termination or acceleration of the Credit
Agreement pursuant to the provisions thereof.

 

EXHIBIT A-2-1

 

 

This Note shall be subject to repayment and prepayment in accordance with the
provisions of Section 2.7 and Section 2.8 of the Credit Agreement.

 

To the maximum extent permitted by law, the Borrower waives presentment, demand,
protest and all other notices of any kind.

 

This Note may not be transferred except in compliance with the terms of the
Credit Agreement.

 

This Note shall be governed by, and construed and enforced in accordance with,
the laws of the State of New York.

 

[SIGNATURE PAGE FOLLOWS]

 

EXHIBIT A-2-2

 

 

IN WITNESS WHEREOF, this Note has been duly executed and delivered on the date
first above written.

 

  HUNT COMPANIES FINANCE TRUST, INC.,   a Maryland corporation    
                    By:     Name:     Title:  

 

EXHIBIT A-2-3