EXECUTION COPY

 

April 28, 2014

 

Reimbursement Agreement

 

This reimbursement agreement is entered into on and as of the date set forth
above (this “Agreement”) and sets forth certain agreements between RCAP
Holdings, LLC, a Delaware limited liability company (“Holdings”), and RCS
Capital Corporation, a Delaware corporation (the “Corporation”).

 

On the date of this Agreement, the Corporation shall consummate the transactions
contemplated by the Agreement and Plan of Merger dated as of January 16, 2014,
among the Corporation, Clifford Acquisition, Inc., a Delaware corporation,
Cetera Financial Holdings, Inc., a Delaware corporation, and the other parties
thereto. To facilitate the consummation of such transactions, the Corporation
shall also, on the date of this Agreement, enter into (a) the First Lien Credit
Agreement, with Holdings, RCS Capital Management, LLC, the lenders party
thereto, and Barclays Bank PLC, as administrative agent and as collateral agent,
and (b) the Second Lien Credit Agreement, with Holdings, RCS Capital Management,
LLC, the lenders party thereto, and Bank of America, N.A., as administrative
agent and as collateral agent. Collectively, the First Lien Credit Agreement and
Second Lien Credit Agreement are referred to herein as the “Financing
Agreements.”

 

The Financing Agreements provide, among other things, that (a) an amount of the
proceeds of the term loans under the Financing Agreements necessary to repay all
amounts outstanding under the First Allied Seller Notes (as defined below) shall
be placed into escrow (the “Special Escrow”) by the Corporation for the
repayment of such amounts, (b) the amount deposited in the Special Escrow by the
Corporation may be drawn on by Holdings to repay its obligations under the First
Allied Seller Notes, and (c) the failure to prepay the outstanding principal
amount of the term loan and revolving loan indebtedness, and all accrued but
unpaid interest thereon (collectively, the “First Allied Indebtedness”), under
First Allied Credit Agreement (as defined below) within 90 days following the
closing date under the Financing Agreements will be an event of default under
such Financing Agreements. In connection with the foregoing, Holdings DOES
HEREBY agree, solely for the benefit of the Corporation and the Corporation’s
successors and assigns (and not any third party), that Holdings shall, (x)
reimburse the Corporation for any amounts drawn on by Holdings from the Special
Escrow in connection with repaying Holdings’ obligations under the First Allied
Sellers Notes, within 5 business days of drawing upon any such amounts;
provided, however, that if Holdings shall fail to reimburse the Corporation
within such 5 business day period for the amounts drawn from the Special Escrow,
then, until such unreimbursed amounts shall have been paid in full, interest
shall accrue thereon at LIBOR plus the Applicable Margin for Term Loans (each,
as defined in the Financing Agreements); provided, further, however, that the
interest imposed by the preceding proviso shall not excuse the default of
Holdings to pay its reimbursement obligations hereunder, and (y) if the First
Allied Contribution (as defined below) is not consummated prior to the ninetieth
day following the closing date under the Financing Agreements, prepay in full
the amount of the First Allied Indebtedness on or prior to such ninetieth day.

 

 

 

 

Reimbursement Agreement

Page 2 of 3

 

As used in this Agreement, the term (i) “First Allied Credit Agreement” shall
mean the Amended and Restated Credit Agreement dated as of January 2, 2013,
between First Allied Holdings Inc. and Fifth Third Bank, as amended, modified,
restated, or amended and restated from time to time, (ii) “First Allied
Contribution” shall mean the contribution by Holdings of its right, title and
interest in all 46,920,050 issued and outstanding shares of common stock, par
value $0.0001 per share, of First Allied Holdings Inc. to the Corporation, on
the terms and subject to the conditions set forth in the Contribution Agreement
dated as of April 3, 2014 between Holdings and the Corporation, and (iii) “First
Allied Seller Notes” shall mean the Exchangeable Promissory Notes issued by
Holdings as partial consideration for its September 25, 2013 acquisition of
First Allied Holdings Inc.

 

This Agreement shall be binding upon each of the parties and their respective
legal representatives, successors and assigns. This Agreement shall be governed
by and construed in accordance with the internal laws of the State of New York.
This Agreement may be executed (including by facsimile transmission) with
counterpart signature pages in one or more counterparts, all of which when taken
together shall constitute one agreement.

 

[END OF TEXT]

 

 

 

 

Reimbursement Agreement

Page 3 of 3

 

This Agreement has been duly executed and delivered by the parties hereto as of
the date first above written.

 

  Corporation:       RCS Capital Corporation       By: /s/ William M. Kahane  
Name: William M. Kahane   Title: Chief Executive Officer       Holdings:      
RCAP Holdings, LLC       By: /s/ Nicholas S. Schorsch   Name: Nicholas S.
Schorsch   Title: Managing Member