Execution Version

Amended and Restated Confirmation in respect of Repurchase Transaction

(Class A-R Notes)

September 30, 2020

To:

Investcorp Credit Management BDC, Inc. (f/k/a CM Finance Inc.)

280 Park Avenue, 39th Floor

New York, NY 10017

Attention: Rocco DelGuercio, and Matt Bannon

Tel: (212) 380-5904

Email: rdelguercio@Investcorp.com, mmauer@investcorp.com and
mbannon@Investcorp.com

 

From:

UBS AG, London Branch

Dear Sirs/ Mesdames,

The purpose of this amended and restated confirmation (this “Confirmation”) is
to set forth the terms and conditions of the above-referenced repurchase
transaction between Investcorp Credit Management BDC, Inc. (f/k/a CM Finance
Inc.) (“Seller”) and UBS AG, London Branch (“Buyer”, and “Party” shall mean
either Seller or Buyer), on the Trade Date specified below (the “Transaction”).
This Confirmation evidences the Transaction (replacing the form of Confirmation
required by Annex II to the Agreement which shall not apply to the Transaction)
and forms a binding agreement between Seller and Buyer as to the terms of the
Transaction.

This Confirmation supplements, forms part of, and is subject to the TBMA/ISMA
Global Master Repurchase Agreement (2011 version), dated as of June 11, 2019,
between Seller and Buyer, together with the Annex(es) thereto (as supplemented,
amended or otherwise modified from time to time, the “Agreement”).

With effect from the Amendment Effective Date, this Confirmation amends and
restates the prior Confirmation dated June 21, 2019 (the “Original
Confirmation”) relating to the Transaction described herein, which Original
Confirmation (with respect to the period from and after the Amendment Effective
Date) is hereby superseded and shall be of no further force or effect.

All provisions contained or incorporated by reference in the Agreement shall
govern this Confirmation except as expressly modified below. In the event of any
inconsistency between the provisions of the Agreement and this Confirmation,
this Confirmation will prevail. In this Confirmation, defined words and
expressions shall have the same meaning as in the Agreement unless otherwise
defined in this Confirmation, in which case terms used in this Confirmation
shall take precedence over terms used in the Agreement.

 

 

1    General Terms

    

Seller:

  

Investcorp Credit Management BDC, Inc.

Buyer:

  

UBS AG, London Branch

Calculation Agent:

  

UBS AG, London Branch.

 

The Calculation Agent shall perform all determinations and calculations
hereunder in good faith and in a commercially reasonable manner. For the purpose
of making any determination or calculation hereunder, the Calculation Agent may
rely on any

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information or notice delivered by a third party.

Trade Date:

  

June 21, 2019.

Amendment Effective Date:

  

September 30, 2020.

Purchase Date:

  

June 21, 2019.

Repurchase Date:

  

December 5, 2021, subject to adjustment in accordance with the Business Day
Convention, as such date may be accelerated as provided herein and in the
Agreement.

Purchased Securities:

  

The Class A-R Notes.

 

On the Purchase Date, Seller shall transfer to Buyer the Class A-R Notes having
an Outstanding Class A-R Funded Amount of USD0 in exchange for the Purchase
Price on the Purchase Date, provided that the foregoing obligation of Seller to
make such transfer shall be deemed to be satisfied upon the entry by Buyer and
Seller into the TRS Termination Agreement.

Purchase Price:

  

On any date of determination, 75% of the Outstanding Class A-R Funded Amount as
of such date of determination, as such amount may from time to time be reduced
pursuant to the operation of the “Purchase Price Reduction” provisions herein or
increased pursuant to the immediately succeeding paragraph.

 

Seller agrees that, upon any funding by Buyer of any portion of the Class A-R
Notes under the Revolving Credit Note Agreement on any date after the Trade Date
(resulting in an increase in the Outstanding Class A-R Funded Amount of the
Class A-R Notes), the Purchase Price shall be increased by an amount equal to
such funded amount and Buyer shall be deemed (for all purposes of this
Confirmation) to have paid for such increase in the Purchase Price to Seller.

Repurchase Price:

  

With respect to each Purchased Security, the Purchase Price for such Purchased
Security as of the relevant Repurchase Date, as such amount may from time to
time be reduced by a Voluntary Partial Prepayment pursuant to the operation of
the “Purchase Price Reduction” provisions herein; in which case, for the
avoidance of doubt, the Purchase Price will be reduced by the Prepayment Amount
in respect of such Voluntary Partial Prepayment.

 

For the avoidance of doubt, there shall be no Price Differential incorporated
into the Repurchase Price and all references to Price Differential and Pricing
Rate are hereby deleted from the Agreement. In lieu of Price Differential,
Seller shall be obligated to pay the Transaction Fee Amounts to Buyer as set
forth herein. For the avoidance of doubt, paragraphs 2(kk), 2(ll) and 2(rr) of
the Agreement shall not apply to the Transaction.

Termination of Transaction:

  

Subject to paragraphs 10 and 11 of the Agreement and Buyer’s rights with respect
to a Regulatory Event and as otherwise set forth in this Confirmation, unless
the parties otherwise agree, the Transaction shall not be terminable on demand
by either Party.

Purchase Price Reduction:

  

(a)       Seller may elect to prepay all or a portion of the Repurchase Price of
the Purchased Securities upon at least five Business Days’ prior written notice
to Buyer, any prepayment under this clause (a), a “Voluntary Prepayment”, any
prepayment of all of the then-outstanding Repurchase Price under this clause
(a), a “Voluntary

 

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Full Prepayment” and any prepayment of a portion of the then-outstanding
Repurchase Price under this clause (a), a “Voluntary Partial Prepayment”);
provided that a Voluntary Partial Prepayment may be elected if a portion of the
Outstanding Class A-R Funded Amount of the Purchased Securities has been repaid
by the Issuer for cash in the form of USD on or prior to the related Prepayment
Date (as defined below) and the portion of the Purchased Securities to be
repurchased shall be those which have been repaid and in an amount not in excess
of the Current Repaid Amount.

 

(b)       If a Mandatory Prepayment Event has occurred and is continuing with
respect to the Purchased Securities:

 

(i)       if the Mandatory Prepayment Event is the result of the occurrence of
an event described in clause (a) of the definition of “Mandatory Prepayment
Event”, Buyer may upon at least three Business Days’ prior written notice to
Seller require Seller to prepay the entire Repurchase Price of the Purchased
Securities; and

 

(ii)       if a Mandatory Prepayment Event is the result of the occurrence of an
event described in clause (b) of the definition of “Mandatory Prepayment Event”,
Seller shall prepay the Repurchase Price of the Purchased Securities on the
applicable Mandatory Prepayment Date (as defined in the Indenture) (such date,
the “Prepayment Date” with respect to any such event) in an amount equal to the
portion of the Outstanding Class A-R Funded Amount that has been repaid under
the Indenture as a result of such event (such amount, the “Prepayment Amount”
with respect to any such event),

 

(each of the prepayments in clauses (i) and (ii), a “Mandatory Prepayment”).

 

Each written notice delivered by Seller under clause (a) above or by Buyer under
clause (b)(i) above shall designate the date on which such prepayment is to be
effective (each a “Prepayment Date”). For purposes of any Prepayment Date
relating to a Voluntary Partial Prepayment, the “Prepayment Amount” shall be an
amount equal to the product of (x) the Advance Percentage applicable to Cash (as
specified in the Indenture) and (y) the Current Repaid Amount and in the case of
a Voluntary Full Prepayment, the “Prepayment Amount” shall be an amount equal to
the Repurchase Price.

 

Subject to the Failure to Deliver Equivalent Securities and the timing therein,
on each Prepayment Date:

 

(A)   Buyer shall transfer to Seller or its agent Equivalent Securities, which,
in the case of (x) a Voluntary Partial Prepayment or a Voluntary Full Prepayment
occurring after repayment of the Outstanding Class A-R Funded Amount of the
Notes or (y) a Mandatory Prepayment Event described in clause (b) of the
definition thereof, shall be in the form of USD cash in an amount equal to the
Current Repaid Amount;

 

(B)   Seller shall pay the related Prepayment Amount to Buyer;

 

(C)   Seller shall pay the related Breakage Amount (if any) to Buyer; and

 

(D)   with respect to a Voluntary Partial Prepayment or a Mandatory Prepayment
Event described in clause (b) of the definition thereof that does not result in

 

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     prepayment in full of the Repurchase Price, for each Purchased Security
that is the subject of such prepayment, the Repurchase Price for such Purchased
Security immediately after giving effect to such prepayment shall be equal to
(x) the Repurchase Price thereof immediately prior to such prepayment minus
(y) the related Prepayment Amount for such Purchased Security.

 

For purposes of the foregoing, amounts payable by Buyer and Seller under (A),
(B) and (C) above shall be netted.

Current Repaid Amount:

  

With respect to any Prepayment Date relating to a Voluntary Partial Prepayment
or a Voluntary Full Prepayment occurring after repayment in full of the
Outstanding Class A-R Funded Amount in respect of the Notes, an amount in USD
determined by the Calculation Agent equal to the aggregate amount actually
received by the holder of the Purchased Securities from the Issuer as a
principal repayment of the Outstanding Class A-R Funded Amount in respect of the
Purchased Securities on or prior to such Prepayment Date that has not previously
been delivered by Buyer to Seller as Equivalent Securities.

Mandatory Prepayment
Event:   

It shall constitute a Mandatory Prepayment Event with respect to Seller if:

 

(a)       after giving effect to all applicable notice requirements and grace
periods, an Indenture Event of Default occurs; provided that, for purposes of
this Confirmation, the determination of whether or not an Indenture Event of
Default has occurred with respect to any amount due and payable on the Purchased
Securities on the stated maturity thereof shall be made (x) without giving
effect to the first sentence of Section 2.7(g) of the Indenture and (y) without
giving effect to any grace period in Section 5.1(a) or Section 5.1(b)(i) of the
Indenture; or

 

(b)       a Mandatory Repayment occurs under (and as defined in) the Indenture.

Accelerated Termination
Event:   

Buyer may, at any time following the occurrence of a Regulatory Event, terminate
the Transaction under this Confirmation by notifying Seller of an early
Repurchase Date for the Transaction, which Repurchase Date shall not be earlier
(unless so agreed by Buyer and Seller) than 10 calendar days after the date of
such notice (or such lesser period as may be necessary for Buyer to comply with
its obligations under applicable laws and regulations arising as a result of
such Regulatory Event). Upon knowledge of any Regulatory Event that may occur,
Buyer and Seller shall negotiate in good faith to enter into one or more
financing transactions with substantially the same terms as the effected
Transaction.

Regulatory Event:   

An event which shall occur if, at any time, (a) Buyer determines, in its good
faith commercially reasonable discretion, that Buyer’s involvement in the
transactions contemplated in this Confirmation and the Agreement violates any
law, rule or regulation applicable to Buyer or (b) any applicable Governmental
Authority informs Buyer that Buyer’s involvement in such transactions violates
any law, rule or regulation applicable to Buyer.

Paragraph 6(h):

  

Paragraph 6(h) shall be amended by deleting the words “Subject to paragraph 10,”
at the beginning thereof such that, for the avoidance of doubt, such paragraph
applies with respect to all payment obligations arising out of the occurrence of
an Accelerated Termination Event, Voluntary Partial Prepayment, Voluntary Full
Prepayment or an early Repurchase Date (including, without limitation, payment
obligations in respect of Income that have accrued on or prior to the relevant
date), provided that the foregoing shall be without prejudice to the exercise of
any set-off

 

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pursuant to paragraphs 10(d)(ii) or 10(n) of the Agreement.

Failure to Deliver
Equivalent Securities:
  

In respect of this Transaction, this provision (Failure to Deliver Equivalent
Securities) shall apply in relation to the Buyer’s obligations with respect to
the Class A-R Notes in lieu of paragraph 10(i) of the Agreement and any
reference in the Agreement to paragraph 10(i) in respect of Buyer’s obligations
with respect to the Class A-R Notes shall be deemed to be a reference to this
provision (Failure to Deliver Equivalent Securities).

 

It is acknowledged by each of the Parties hereto that the Class A-R Notes are
unique assets, and that accordingly no asset other than the Purchased Securities
will qualify as Equivalent Securities.

 

Notwithstanding anything to the contrary in paragraph 10 of the Agreement or
otherwise in the Agreement or this Confirmation and without duplication of the
Cure Period provisions below, if Buyer (the “Transferor”) fails to deliver to
Seller (the “Transferee”) any Purchased Security (an “Unavailable Asset”) by the
time (the “Due Date”) required under this Transaction or within such other
period as may be agreed in writing by the Transferor and the Transferee (such
failure, a “Transfer Failure”):

 

(a)       the Transferor, acting in good faith and a commercially reasonable
manner, shall try for a period of 10 calendar days from the day following the
Due Date in respect of the Unavailable Asset (the last day of such period, the
“Transfer Cut-Off Date”) to obtain such Unavailable Asset (and, where the
Transfer Failure is in respect of Buyer’s obligation to deliver the Purchased
Securities on the scheduled Repurchase Date for this Transaction, this
Transaction shall be deemed to continue until, and terminate upon, the Extended
Termination Date);

 

(b)       if the Transferor obtains any Unavailable Asset on or prior to the
Transfer Cut-Off Date, the Transferor shall promptly give notice to the
Transferee of its ability to deliver such Unavailable Asset and shall transfer
such Unavailable Asset to the Transferee on the third Business Day following the
day on which the Transferor delivers such notice in settlement of the relevant
Transfer Failure; and

 

(c)       if any Unavailable Asset is repaid in full or in part by the relevant
issuer prior to the Transfer Cut-Off Date, then either Party may give notice to
the other Party of such repayment after becoming aware of the same, and the
Transferor shall transfer a sum of money equivalent to the proceeds of such
repayment to the Transferee no later than two Business Days following the day on
which the Transferor delivers or receives such notice, in exchange for the
payment by the Transferee of all or a ratable portion of any unpaid Repurchase
Price (as applicable).

 

For the avoidance of doubt, in relation to this Transaction, the Parties’ other
obligations under the Agreement shall continue, and if such Transfer Failure
occurred in connection with the relevant Repurchase Date for this Transaction,
the Transaction shall terminate on the day (the “Extended Termination Date”)
which is, with respect to the last Unavailable Asset, the earliest to occur of:

 

(i)       the Business Day on which the Transferor transfers such last
Unavailable Asset in accordance with sub-paragraph (c) above; or

 

(ii)      the day on which the Transferor transfers proceeds of such repayment
if such last Unavailable Asset is repaid in full in accordance with
sub-paragraph (c)

 

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above.

 

If any such Transfer Failure continues to subsist after the Due Date for this
Transaction, the Transaction Fee Amounts in respect of such Unavailable Assets
shall cease to accrue on the Due Date for this Transaction and no further
Transaction Fee Amounts shall be payable in respect of this Transaction,
notwithstanding the continuance of the Parties’ obligations up to the Extended
Termination Date under this provision.

Determination of Default

Valuation Time:

  

The “Default Valuation Time” means, in relation to an Event of Default, the
close of business in the applicable market on the 40th dealing day after the day
on which the non-Defaulting Party delivers notice designating an Early
Termination Date pursuant to paragraph 10(b) of the Agreement or, where that
Event of Default is the occurrence of an Act of Insolvency in respect of which
Automatic Early Termination is specified in Annex I, the close of business on
the 40th dealing day after the day on which the non-Defaulting Party first
became aware of the occurrence of such Event of Default.

 

Paragraph 10(f)(i) of the Agreement shall be amended by adding the words “(but
in no event later than the Default Valuation Time)” immediately following the
words “on or about the early Termination Date”.

 

Paragraph 10(f)(ii) of the Agreement shall be amended by adding the words “(but
in no event later than the Default Valuation Time)” immediately following the
words “on or about the early Termination Date”.

 

For the avoidance of doubt, the amount payable pursuant to paragraph 10(d) of
the Agreement cannot be calculated until the Default Market Values of all of the
Equivalent Securities and any Equivalent Margin Securities under each
Transaction can be calculated. As such, the payment under paragraph 10(d)(ii)
will be delayed until the latest date on which the Default Market Value has been
determined with respect to any such Equivalent Securities and any Equivalent
Margin Securities.

 

The parties acknowledge that (a) the Purchased Securities under this Transaction
are expected to be illiquid and unique and that there may be no other
commercially reasonable determinant of value with respect to such Purchased
Securities other than the price at which willing buyers agree to purchase such
Purchased Securities or the relevant Portfolio Assets, (b) if the Buyer were
forced to liquidate such Purchased Securities or the relevant Portfolio Assets
on the date an Event of Default occurs (or shortly thereafter), such liquidation
would likely result in a commercially unreasonable price, and (c) giving the
Buyer an extended period of time to liquidate such Purchased Securities or the
relevant Portfolio Assets is more likely to produce a commercially reasonable
result. For avoidance of doubt, Buyer may, at any time, use any commercially
reasonable determinant of value (whether the price at which willing buyers agree
to purchase such Purchased Securities or the relevant Portfolio Assets or
otherwise).

Income:

  

Notwithstanding anything to the contrary in paragraph 5 (Income) of the
Agreement, “Income” means, without double counting:

 

(i) any interest or dividend payment or any other payment or distribution (other
than any principal payment or repayment, which, for the avoidance of doubt,
includes any repayment of the Outstanding Class A-R Funded Amount in connection
with a Mandatory Repayment under (and as defined in) the Indenture) paid with
respect to

 

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any Purchased Securities and not otherwise received by Seller; and

 

(ii) any interest or dividend payment or any other payment or distribution
(other than any principal payment or repayment, which, for the avoidance of
doubt, includes any repayment of the Outstanding Class A-R Funded Amount in
connection with a Mandatory Repayment under (and as defined in) the Indenture)
paid with respect to any Class A-R Notes and with respect to (x) the Monthly
Period (as defined in the Indenture) commencing on and including May 15, 2019,
and (y) the Monthly Period (as defined in the Indenture) commencing on and
including June 15, 2019, and, in each case, that are not otherwise received by
Seller.

 

Buyer shall transfer to Seller an amount equal to (and in the same currency as)
the amount of all Income paid or distributed on or in respect of the Purchased
Securities within one Business Day after the date on which such Income is paid
or distributed to, and actually received by, holders of the Purchased
Securities, and paragraph 5(a) of the Agreement shall be amended accordingly.
For avoidance of doubt, (a) references to the amount of any Income paid shall be
to an amount paid net of any withholding or deduction for or on account of taxes
or duties and (b) Buyer shall not (except in connection with a termination of
this Transaction resulting from an Event of Default) net or set-off against or
otherwise apply the Income payment or payments to reduce the amount, if any, to
be transferred to Buyer by Seller upon termination of this Transaction.

 

Paragraph 2(u) of the Agreement shall be amended by deleting the words “(other
than Distributions)”.

 

Paragraph 2(v) of the Agreement shall be amended by deleting the words “other
than a Distribution”.

Clawback:

  

If (a) any distribution (whether as an Income payment or otherwise) on a
Purchased Security, an Equivalent Security or, if the Equivalent Security is
cash, such cash, is received by Buyer and subsequently paid by Buyer to Seller
hereunder, and (b) Buyer is subsequently required to transfer all or a portion
of such payment to the issuer of such Security (or trustee, paying agent or
similar party) (the amount transferred, the “Clawback Amount”), then promptly
after receiving notice of such Clawback Amount from Buyer, Seller shall transfer
an amount equal to the Clawback Amount to Buyer. Buyer agrees to pay over to
Seller within one Business Day after receipt any amounts subsequently recovered
(but only to the extent such amounts are actually received by Buyer and Buyer is
not otherwise obligated to pay such amounts to Seller pursuant to any other
provision hereunder such that payment would result in duplicative payments by
Buyer or any other party), and to make reasonable efforts to claim and collect
such recoveries. No interest shall be payable by Buyer or Seller in relation to
Clawback Amounts or amounts recovered in respect thereof for the period prior to
such amounts becoming payable under this provision. This provision shall survive
the termination of the Transaction.

Cure Period:

  

Notwithstanding paragraph 10(a) of the Agreement as amended by any Annex, the
failure of a Party (“X”) to make any payment or delivery referred to in such
paragraph (other than a payment or delivery referred to in paragraph 10(a)(iv)
of the Agreement) in respect of the Transaction will not give rise to the right
of the other Party to deliver a Default Notice to X unless such failure is not
remedied on or before the first Business Day after notice of such failure is
given to X.

Events of Default:

  

In addition to the Events of Default set forth in the Agreement, if any of the
following events occurs, it shall constitute an Event of Default with respect to
the

 

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relevant Party specified below which shall be the Defaulting Party:

 

(a)       with respect to Seller, if Seller fails to pay any Transaction Fee
Amount due on a Transaction Fee Payment Date, and Buyer, as non-Defaulting
Party, serves a Default Notice on the Seller as Defaulting Party;

 

(b)       with respect to Seller, if Seller breaches any of the covenants set
forth in the section “Certain Covenants of Seller” below and Buyer, as
non-Defaulting Party, serves a Default Notice on the Seller as Defaulting Party;

 

(c)       with respect to Seller, if Seller breaches the CM Finance Financials
Requirement and such failure is not cured within three Business Days following
notice from Buyer to Seller of such failure, and Buyer, as non-Defaulting Party,
serves a Default Notice on the Seller as Defaulting Party;

 

(d)       with respect to Seller, if Seller fails to pay the applicable Breakage
Amount (if any) on any Prepayment Date or early Repurchase Date, and Buyer, as
non-Defaulting Party, serves a Default Notice on the Seller as Defaulting Party;

 

(e)       with respect to Seller, Seller fails to pay any Clawback Amount in
accordance with the “Clawback” provisions herein and Buyer, as non-Defaulting
Party, serves a Default Notice on the Seller as Defaulting Party;

 

(f)       with respect to Seller, if Seller’s Investment Manager ceases to be
responsible for the asset management, loan servicing, special servicing or
underwriting services of Seller and its subsidiaries, and Buyer, as
non-Defaulting Party, serves a Default Notice on the Seller as Defaulting Party;

 

(g)       with respect to Seller, notwithstanding anything to the contrary in
the Agreement, if Seller fails to deliver Purchased Securities on any Purchase
Date (including without limitation, as a result of a failure by the Issuer to
issue the related Purchased Securities on or prior to such Purchase Date),
including, for the avoidance of doubt, each Additional Purchase Date and Buyer,
as non-Defaulting Party, serves a Default Notice on Seller as Defaulting Party;

 

(h)       with respect to Seller, the occurrence of any of the events set forth
in Section 10(b) of the Collateral Management Agreement, and Buyer, as
non-Defaulting Party, serves a Default Notice on Seller as Defaulting Party;

 

(i)       with respect to Seller, the occurrence of any breach by Seller, as
Sole Member, of any of its obligations under the Issuer Contribution Agreement,
and Buyer, as non-Defaulting Party, serves a Default Notice on Seller as
Defaulting Party;

 

(j)       with respect to Seller, a Zero Value Portfolio Asset EoD (as defined
the “Zero Value Portfolio Asset EoD” provisions below) has occurred, and Buyer,
as non-Defaulting Party, serves a Default Notice on Seller as Defaulting Party;
and

 

(k)       with respect to Seller, on any date of determination by the
Calculation Agent, the Asset Coverage Ratio is less than 150%.

 

Each of the foregoing Events of Default shall be an “Exempt Event of Default”
for purposes of the Agreement.

 

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Breakage Amounts:

  

If (a) the Repurchase Date for this Transaction occurs prior to the scheduled
Repurchase Date by reason of the occurrence of an Event of Default (where Seller
is the Defaulting Party), a Mandatory Prepayment (other than a Mandatory
Prepayment that is the result of the occurrence of the event described in clause
(b) of the definition of “Mandatory Prepayment Event”), a Voluntary Full
Prepayment or an event described in paragraph 11(a) of the Agreement in respect
of which Seller is the notifying party or (b) a Prepayment Date occurs in
connection with a Voluntary Partial Prepayment, then, without limitation of any
other payments or deliveries that become due as a result of such event but
without duplication, on such Repurchase Date, Seller shall pay to Buyer an
amount equal to the Breakage Amount for this Transaction or the applicable
portion thereof. For the avoidance of doubt, no Breakage Amount shall be payable
by Seller in respect of any Repurchase Date occurring as a result of a
Regulatory Event.

 

“Breakage Amount” shall mean, with respect to the Transaction evidenced hereby
(or, in the case of a Voluntary Partial Prepayment the applicable portion
thereof that is the subject of such Voluntary Partial Prepayment), the present
value (using a discount factor implied by the mid-point between the forward bid
and offered side LIBOR curves for fixed-for-floating LIBOR swaps of the relevant
tenors) of the product of (a) 50% of the Maximum RCN Facility Funding Commitment
multiplied by (b) 2.50% that would have been payable to Buyer under such
Transaction (or the applicable portion thereof) from (and including) the early
Repurchase Date or applicable Prepayment Date (as applicable) to (but excluding)
the scheduled Repurchase Date, as determined by the Calculation Agent; provided
that if (i) such LIBOR curves do not appear on the relevant Bloomberg page (or
any replacement page), as of the relevant time of determination by the
Calculation Agent, (ii) a public statement or publication of information has
been made by or on behalf of the administrator of LIBOR or a governmental
authority or regulatory supervisor having jurisdiction or regulatory authority
over Buyer, identifying a date after which LIBOR shall no longer be used or
shall no longer be representative for determining interest rates for loans, or
(iii) Buyer determines that any replacement curves are appropriate to determine
amounts equivalent to the Breakage Amount for transactions that are similar to
those contemplated under this Confirmation with similarly situated
counterparties, such replacement curves shall be utilized by the Calculation
Agent for purposes of determining the Breakage Amount.

 

2    Purchased Securities, Margining and Substitutions

Marking to Market:

  

The Parties agree that, with respect to this Transaction, the provisions of
paragraphs 4(a) to (i) (inclusive), 4(k) and 4(l) of the Agreement shall not
apply and instead margin shall be provided separately in respect of this
Transaction in accordance with the terms of this Confirmation. For the avoidance
of doubt, the provisions of paragraph 8(d) of the Agreement shall not apply to
the Transaction.

Margin Maintenance:

  

Subject to the “Timing of Transfer of Eligible Margin” provision of this
Confirmation:

 

(a)    if at any time the Net Transaction Exposure for the Transaction is
greater than the Minimum Transfer Amount, Buyer may, by notice to Seller,
require Seller to, and Seller shall following such notice, transfer to Buyer an
amount of Eligible Margin such that, immediately following such transfer, the
Net Transaction Exposure is not greater than zero;

 

(b)    if at any time (i) the Net Transaction Exposure for the Transaction is
less

 

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     than zero and (ii) the absolute value of the Net Transaction Exposure for
the Transaction exceeds the Minimum Transfer Amount, Seller may, by notice to
Buyer, require Buyer to, and Buyer shall following such notice, transfer an
amount of Eligible Margin to Seller equal to the Net Transaction Exposure;

 

(c)    if at any time the Class A-R Supplemental Margin Amount for the
Transaction is a positive number, Buyer may, by notice to Seller, require Seller
to, and Seller shall following such notice, transfer to Buyer an amount of
Eligible Margin equal to the Class A-R Supplemental Margin Amount;

 

(d)    if at any time the Class A-R Supplemental Margin Amount for the
Transaction is a negative number, Seller may, by notice to Buyer, require Buyer
to, and Buyer shall following such notice, transfer an amount of Eligible Margin
to Seller equal to the absolute value of the Class A-R Supplemental Margin
Amount;

 

provided that:

 

(i) Buyer shall only be obligated to transfer Eligible Margin to Seller pursuant
to sub-clause (d) above if (and only to the extent that) such transfer of
Eligible Margin by Buyer is a return of Eligible Margin that has previously been
transferred by Seller to Buyer pursuant to sub-clause (c) above in respect of
the Transaction and has not been previously returned by Buyer to Seller; and

 

(ii) Buyer or Seller may not transfer Eligible Margin except to the extent that
it is requested by the other Party to do so in accordance with the applicable
sub-clause (a) through (d) above and accordingly, any Eligible Margin
transferred by either Party in breach of this sub-clause (iii) shall not qualify
as Eligible Margin and shall be assigned a zero value for all purposes hereof
unless, until and solely to the extent that Eligible Margin is subsequently
requested by the other Party in accordance with any of sub-clauses (a) through
(d) above.

 

Seller acknowledges that failure to timely Transfer Eligible Margin may have
ramifications under the Indenture, Collateral Management Agreement and Issuer
Contribution Agreement, including, but not limited to, failure of conditions
necessary to purchase or sell Portfolio Assets thereunder and acceleration of
the Notes.

Class A-R Supplemental Margin Amount:   

As of any date of determination by the Calculation Agent, the “Class A-R
Supplemental Margin Amount” shall be equal to:

 

(a)    the product of (i) the excess (if any) of (A) the quotient of
(1) Repurchase Price divided by (2) Trigger over (B) Prospective Inclusion MV
multiplied by (ii) the Class A-R Note Cash-Out Percentage minus

 

(b)    the product of (i) Supplemental Margin Held multiplied by (ii) the
Class A-R Note Cash-Out Percentage,

 

where:

 

“Prospective Inclusion MV” means, as of any date of determination, the Portfolio
Inclusion MV as of such date of determination, but determined as if the trade
date or contribution date for any proposed sale, disposition or acquisition of
any Portfolio

 

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Asset that has been identified in a Collateral Change Event Notice (as each such
term is defined in the Issuer Contribution Agreement) has already occurred;

 

“Repurchase Price” for purposes of calculating the Class A-R Supplemental Margin
Amount means the sum of: (i) all of the Repurchase Prices in respect of all
Purchased Securities (which shall, for the avoidance of doubt, give effect to
reductions in such Repurchase Prices resulting from any Voluntary Partial
Prepayment) plus (ii) the Repurchase Prices (as defined in the Class A Note Repo
Confirmation) of all of the Purchased Securities (as defined in the Class A Note
Repo Confirmation) under the Class A Note Repo Confirmation;

 

“Supplemental Margin Held” means, as of any date of determination, the aggregate
Market Value of all Eligible Margin held by UBS as Buyer in respect of (a) the
Class A Supplemental Margin Amount (as defined in the Class A Note Repo
Confirmation and (b) Class A-R Supplemental Margin Amount, in each case, but not
yet returned to Seller prior to such date of determination; and

 

“Trigger” means 60%.

Eligible Margin:

  

USD cash only.

Net Transaction Exposure:

  

As of any time, an amount equal to the excess (if any) of:

 

(a)    the Purchased Securities Exposure Amount over

 

(b)    an amount equal to the product of (i) the amount of Net Margin
(determined exclusive of Supplemental Margin Held) provided to Buyer by Seller
multiplied by (ii) the Class A-R Note Cash-Out Percentage.

Purchased Securities Exposure Amount:

  

An amount equal to the product of:

 

(a) the excess (if any) of (i) the Portfolio Inclusion MV over (ii) the Market
Value of the Purchased Securities, multiplied by

 

(b) the Class A-R Note Cash-Out Percentage.

Minimum Transfer Amount:

  

As of any time, the Minimum Transfer Amount shall be:

 

(a) at all times from and including the Purchase Date to and including such time
as the Purchased Securities Exposure Amount is first greater than the 7.5%
Threshold, the 7.5% Threshold; or

 

(b) otherwise, the product of (i) USD250,000 multiplied by (ii) the Class A-R
Note Cash-Out Percentage.

 

“7.5% Threshold” means an amount equal to the product of (a) 7.5% multiplied by
(b) the Portfolio Inclusion MV multiplied by (c) the Class A-R Note Cash-Out
Percentage.

Net Margin:

  

The definition of Net Margin in paragraph 2(gg) of the Agreement shall be
deleted in its entirety and replaced with the following:

 

“The ‘Net Margin’ provided to a party at any time shall mean the excess (if any)
at that time of (i) the sum of the amount of Cash Margin paid to that party
(including accrued interest on such Cash Margin which has not been paid to the
other party)

 

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under the Margin Maintenance provisions in this Confirmation and the Margin
Maintenance provisions in the Class A Note Repo Confirmation (in each case,
excluding any Cash Margin which has been repaid to the other party) over
(ii) the sum of the amount of Cash Margin paid to the other party (including
accrued interest on such Cash Margin which has not been paid by the other party)
under the Margin Maintenance provisions in this Confirmation and the Margin
Maintenance provisions in the Class A Note Repo Confirmation (excluding any Cash
Margin which has been repaid by the other party) and for this purpose any
amounts not denominated in the Base Currency shall be converted into the Base
Currency at the Spot Rate prevailing at the relevant time.”

Timing of Transfer of Eligible Margin:   

Where Eligible Margin is to be transferred under the Margin Maintenance
provisions hereof, unless otherwise agreed between the Parties, if the relevant
notification is received:

 

(a)       on a Business Day at or prior to the Margin Transfer Notification
Time, then the transfer shall be made not later than the close of business on
the same Business Day; and

 

(b)       on a Business Day after the Margin Transfer Notification Time or on a
day that is not a Business Day, then the relevant transfer shall be made not
later than the close of business on the next Business Day after the date such
notification is received.

 

“Margin Transfer Notification Time” means 10:00 am (New York time).

Portfolio Inclusion MV:   

On any date of determination by the Calculation Agent, an amount equal to the
sum of:

 

(a)       with respect to each Portfolio Asset held by the Issuer on such date,
including any Zero Value Portfolio Asset, the Purchase Amount of such Portfolio
Asset (as of the date of acquisition), plus

 

(b)       the aggregate amount of all cash held by the Issuer on such date in,
or required to be deposited in, the Principal Collection Subaccount and
Delayed-Draw/Committed Proceeds/Revolver Account, plus

 

(c)       the aggregate market value of all Eligible Investments held by the
Issuer on such date which are credited, or required to be credited to, to the
Principal Collection Subaccount and Delayed-Draw/Committed Proceeds/Revolver
Account.

Market Value:

  

Notwithstanding paragraph 2(ee) of the Agreement, “Market Value” shall mean:

 

(a)       with respect to Eligible Margin, the amount of cash;

 

(b)       with respect to the Purchased Securities, on any date of determination
by the Calculation Agent, an amount equal to the market value of all of the
Purchased Securities, calculated as the sum of:

 

(i)  with respect to each Portfolio Asset held by the Issuer on such date, other
than any Zero Value Portfolio Asset, the product of (A) the Current Price with
respect to such Portfolio Asset multiplied by (B) the Principal Balance with
respect to such Portfolio Asset, in each case on such date of determination,
plus

 

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(ii)   the aggregate amount of all cash held by the Issuer on such date in, or
required to be deposited in, the Principal Collection Subaccount and
Delayed-Draw/Committed Proceeds/Revolver Account, plus

 

(iii)   the aggregate market value of all Eligible Investments held by the
Issuer on such date which are credited to, or required to be credited to, the
Principal Collection Subaccount and Delayed-Draw/Committed Proceeds/Revolver
Account.

 

For the avoidance of doubt, Zero Value Portfolio Assets are excluded from and
thus have a value of zero in the calculation of the Market Value of the
Purchased Securities.

Determination of When Assets are Held
or Disposed of:

  

For purposes of calculating Portfolio Inclusion MV, Market Value pursuant to
clause (b) thereof and the status of an asset (or a portion thereof) as a Zero
Value Portfolio Asset, with respect to:

 

(a)       the Inclusion of any asset which would not, on its Inclusion Date, be
a Zero Value Portfolio Asset, the Portfolio Asset Trade Date shall be used to
determine whether and when a Portfolio Asset is held by the Issuer; and

 

(b)       the Inclusion of any asset which would, on its Inclusion Date, be a
Zero Value Portfolio Asset, the Business Day preceding the Portfolio Asset Trade
Date shall be used to determine whether and when a Portfolio Asset is held by
the Issuer;

 

(c)       the disposition of any asset,

 

(i)  where the asset is a Zero Value Portfolio Asset which is a Defaulted
Obligation, the settlement date for any disposition shall be used to determine
whether and when a Portfolio Asset is held by the Issuer (and, correspondingly,
in the event that the Buyer holds margin, any margin held in respect of such
Defaulted Obligation shall not be released until after the sale proceeds in
respect of such disposition are received), and

 

(ii)   otherwise, (A) where the disposition is to an Approved Dealer on Approved
Terms, the Portfolio Asset Trade Date of such disposition shall be used to
determine whether and when a Portfolio Asset is held by the Issuer and
(B) otherwise the settlement date of such disposition shall be used to determine
whether and when a Portfolio Asset is held by the Issuer; and

 

(d)       cash to be paid or received or Eligible Investments to be liquidated
in relation to Inclusion or disposition of a Portfolio Asset, such cash or
Eligible Investments shall be debited or credited as of the relevant date on
which such Portfolio Asset becomes or ceases to be held by the Issuer as
determined by the Calculation Agent in accordance with the preceding clause (a),
(b) or (c) (as applicable).

Current Price:

  

On any date of determination by the Calculation Agent with respect to any
Portfolio Asset, including as of the related Inclusion Date of such Portfolio
Asset, the net cash proceeds (expressed as a percentage of par) that would be
received from the sale of such Portfolio Asset on such date, exclusive of
accrued interest and capitalized interest and net of the related Costs of
Assignment (as defined below), as

 

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determined by the Calculation Agent.

 

In the event that the Issuer proposes to engage in a sale of a Portfolio Asset,
the Issuer will notify the Calculation Agent of the proposed buyer, the proposed
sale price and proposed settlement date in accordance with the Indenture. (If
such sale is entered into, it is a “Sale”, and the agreed sale price is the
“Sale Price”). After the date on which such notice is received by the
Calculation Agent (the “Sale Notice Date”) and at all times until the settlement
of such transaction, the Current Price (“Sale Adjusted Price”) will be equal to:

 

(a)       if (x) such Sale is to an Approved Dealer on Approved Terms, (y) the
Calculation Agent has received a copy of the related fully executed and
delivered confirmation in substantially the form prescribed by the Loan
Syndications & Trading Association or the Loan Market Association (as
applicable) and (z) the Calculation Agent has determined, based on such
confirmation, that such a Sale constitutes a direct sale to an Approved Dealer,
the Sale Price, exclusive of accrued interest and capitalized interest and net
of the related Costs of Assignment; and

 

(b)       if such Sale is not to one of the Approved Dealers or is not on
Approved Terms, the lesser of (i) the Current Price determined as if there were
no Sale and (ii) the Sale Price exclusive of accrued interest and capitalized
interest and net of the related Costs of Assignment.

 

If the Issuer is to sell a Portfolio Asset for a clean price below the Current
Price of such asset (a “Low Sale”), the Seller will be obligated to transfer
additional Eligible Margin required to reflect the use of the Sale Adjusted
Price as the Current Price prior to, and as a condition of, consummation of the
relevant Low Sale.

 

“Approved Terms” means terms evidenced in a binding confirmation in market
standard form between Issuer and the buyer under the Sale.

 

“Costs of Assignment” means, with respect to any Portfolio Asset, the sum
(without duplication) of (a) any costs of any exchange, sale, transfer or
assignment transaction with respect to such Portfolio Asset that would be paid
by a hypothetical seller in effecting such transaction under the terms of such
Portfolio Asset or otherwise actually imposed on such hypothetical seller by any
applicable trustee, administrative agent, registrar, borrower or Portfolio Asset
Obligor incurred in connection with any such transaction with respect to such
Portfolio Asset (including, without limitation, any amounts reimbursable by such
person in respect of any tax or other governmental charge incurred with respect
thereto), (b) any reasonable expenses that would be incurred by a hypothetical
seller in connection with any such transaction and (c) any reasonable
administrative, legal or accounting fees, costs and expenses (including, without
limitation, any fees and expenses of the trustee of or outside counsel to the
Portfolio Asset Obligor on such Portfolio Asset) that a would be incurred by a
hypothetical seller in connection with any such transaction.

Zero Value Portfolio Asset:

  

(a)       Any Portfolio Asset that, at any time after the Inclusion/Amendment
Date on any date of determination by the Calculation Agent, has (i) become, as
determined by the Calculation Agent, a Defaulted Obligation for a continuous
period of 14 calendar days, or (ii) ceased to comply with any of the Asset
Eligibility Criteria;

 

(b)       Any Illiquid Loan that is deemed to be a Zero Value Portfolio Asset as
a result of Seller’s failure to comply with the requirements described in the
“Third

 

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Party Valuations” provision below;

 

(c)       Any Portfolio Asset which (i) together with any other Portfolio
Assets, has resulted in a breach of any of the Repo Portfolio Criteria; provided
that (i) where a Repo Portfolio Criterion is expressed as a maximum, a Portfolio
Asset shall constitute a Zero Value Portfolio Asset as a result of a violation
of the Repo Portfolio Criteria only with respect to the portion of such
Portfolio Asset that (together with the equivalent and equal portions of any
other Portfolio Assets which are members of the category subject to such
maximum) causes the failure by the Issuer to satisfy any of the Repo Portfolio
Criteria, allocated across Portfolio Assets by the Buyer (in the case where a
Portfolio Asset violates or causes the violation of more than one of the Repo
Portfolio Criteria) and (ii) where a Repo Portfolio Criterion is expressed as a
minimum, a Portfolio Asset shall constitute a Zero Value Portfolio Asset as a
result of a violation of the Repo Portfolio Criteria only with respect to the
portion of such Portfolio Asset that (together with the equivalent and equal
portions of any other Portfolio Assets that are not members of the category
subject to such minimum) causes the failure by the Issuer to satisfy any of the
Repo Portfolio Criteria, allocated across Portfolio Assets by the Buyer (in the
case where a Portfolio Asset violates or causes a violation of more than one of
the Repo Portfolio Criteria);

 

(d)       Any Portfolio Asset that does not at the time of Inclusion satisfy the
conditions and requirements set forth in Section 12.2(a) and 12.3(b) of the
Indenture and that has not since such time satisfied such conditions and
requirements;

 

(e)       Any Portfolio Asset with respect to which Seller took, agreed or
consented to any action under the Collateral Management Agreement, including,
but not limited to, actions relating to voting rights in respect of any
Portfolio Asset, without providing Buyer (acting in its capacity as Liquidation
Agent or otherwise) with any prior or subsequent notice in relation thereto
required by the Collateral Management Agreement within the timeframes set out
therein;

 

(f) [reserved]

 

(g) Any Portfolio Asset in relation to which the Collateral Manager did not
provide an Advance Restructuring Notice (as defined in the Collateral Management
Agreement) when originally due under the Collateral Management Agreement; and

 

(h) Any Portfolio Asset in relation to which the Collateral Manager did not
provide a Post-Restructuring Notice (as defined in the Collateral Management
Agreement) when originally due pursuant to the Collateral Management Agreement.

Determination of Status of Certain Portfolio Assets:

  

For purposes hereof, whether any Portfolio Asset meets the criteria of any of
the following definitions shall be determined by the Buyer as of the latest of
(a) the Inclusion Date for such Portfolio Asset and (b) the most recent
Amendment Date for such Portfolio Asset (such latest date, the
“Inclusion/Amendment Date”):

 

(1) Illiquid Loan;

 

(2) Liquid Loan;

 

(3) Middle-Market Loan;

 

(4) Cov-Lite Loan;

 

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(5) Second Lien Loan;

 

(6) Second Lien Liquid Loan;

 

(7) Senior Secured First Out Loan;

 

(8) Senior Secured Last Out Loan;

 

(9) Senior Secured Last Out (Type I) Loan;

 

(10) Senior Secured Last Out (Type II) Loan;

 

(11) Senior Secured Liquid Loan;

 

(12) Senior Secured Loan;

 

(13) Senior Secured (Large Cap) Loan:

 

(14) Senior Secured (Type I) Loan;

 

(15) Senior Secured (Type I CL) Loan:

 

(16) Senior Secured (Type II) Loan;

 

(17) Senior Secured (Type III) Loan;

 

(18) Senior Secured (Type IV) Loan;

 

(19) Senior Secured Bonds;

 

(20) Non-Senior Secured Bonds; and

 

(21) Traditional Second Lien Loan.

Zero Value Portfolio Asset EoD:

  

With respect to any asset which would, as of its Inclusion Date, be a Zero Value
Portfolio Asset due to failure to satisfy the Asset Eligibility Criteria or Repo
Portfolio Criteria, it shall be a “Zero Value Portfolio Asset EoD” if the
Portfolio Asset Trade Date for the Zero Value Portfolio Asset occurs prior to
the later of:

 

(a)       one Business Day after the date on which the Issuer notified UBS of
the intended Inclusion of such asset; and

 

(b)       one Business Day after the date on which the Seller posted any
additional Margin required based on recalculation of the Market Value of the
Purchased Securities in connection with the acquisition of an asset that would,
on its Inclusion Date, be a Zero Value Portfolio Asset (such recalculation
occurring as of the Business Day preceding the Portfolio Asset Trade Date as
described in clause (b) of the “ Determination of When Assets are Held or
Disposed of “ provision above).

 

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Repo Portfolio Criteria:

  

Criteria that are satisfied on any date of determination by Buyer so long as:

 

(a)       the Aggregate Principal Balance of all Portfolio Assets that are
Second Lien Loans does not exceed 60.0% of the Aggregate Portfolio Par Value;

 

(b)       the Aggregate Principal Balance of all Portfolio Assets that are
Middle Market Loans does not exceed 80.0% of the Aggregate Portfolio Par Value;

 

(c)       the Aggregate Principal Balance of all Portfolio Assets consisting of
Cov-Lite Loans does not exceed 0.0% of the Aggregate Portfolio Par Value; and

 

(d)       the Aggregate Principal Balance of all Portfolio Assets consisting of
Bonds does not exceed 15.0% of the Aggregate Portfolio Par Value.

Third Party Valuations:

  

Seller shall procure that the Initial Valuation Company or a Fallback Valuation
Company provide valuations in respect of each Portfolio Asset that was, as of
the related Inclusion Date an Illiquid Loan (an “Asset Valuation Report”) to
Buyer as follows:

 

(a)       with respect to each such Illiquid Loan acquired by the Issuer, on or
before the Inclusion Date of such Illiquid Loan; and

 

(b)       within 20 calendar days of the last day of each Asset Valuation Report
Period, an Asset Valuation Report in respect of each such Illiquid Loan held by
the Issuer as of such date which remains, as of the last day of such Asset
Valuation Report Period, an Illiquid Loan.

 

For purposes of the foregoing, “Asset Valuation Report Period” means each
calendar quarter ending on March 31, June 30, September 30 and December 31.

 

If, on any date of determination by the Calculation Agent, Seller has failed to
procure an Asset Valuation Report in respect of one or more Illiquid Loans in
accordance with the requirements of clause (a) or (b), each such Illiquid Loan
omitted from such Asset Valuation Report shall be deemed to be a Zero Value
Portfolio Asset until such time as such Illiquid Loan is included in a
subsequent Asset Valuation Report or an equivalent report from the Initial
Valuation Company or a Fallback Valuation Company delivered at any time after
such date of determination (which equivalent report may be requested by Seller
at any time).

Dispute Rights:

  

Provided that no Event of Default has occurred and is continuing with respect to
Seller, if Seller in good faith has a commercially reasonable basis for
disagreement with the Calculation Agent’s determination of the Current Price of
any Portfolio Asset, then Seller may dispute such determination by giving notice
of such dispute (a “Dispute Notice”) to Buyer and the Calculation Agent no later
than (a) if Seller receives notice of the Calculation Agent’s determination of a
Current Price in dispute at or prior to noon (New York time) on any Business
Day, by the close of business on such Business Day and (b) if Seller receives
notice of the Calculation Agent’s determination of a Current Price in dispute
after noon (New York time) on any Business Day, by noon (New York time) on the
following Business Day. Any such Dispute Notice shall specify, in reasonable
detail, the bid-side market price Seller believes should be attributed to any
such Portfolio Asset, along with reasonable evidence supporting such value.

 

Promptly following delivery of a Dispute Notice in relation to any Portfolio
Asset, the Calculation Agent and Seller shall negotiate in good faith to try to
agree to the

 

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disputed Current Price. If by 10:00 a.m. (New York time) on the Business Day
following the day on which the Dispute Notice is delivered, the Calculation
Agent and Seller are unable to agree, then:

 

(i)  Seller shall request that the Initial Valuation Company provide an Eligible
Valuation to the Calculation Agent;

 

(ii)   if (A) no such Eligible Valuation is received by the Calculation Agent
from the Initial Valuation Company by 2:00 p.m. (New York time) on the fifth
Business Day following such request (a “Valuation Non-Delivery”) or (B) the
Buyer in good faith has a commercially reasonable basis to disagree with the
Initial Valuation Company’s Eligible Valuation (a “Valuation Disagreement”) and
the Calculation Agent notifies Seller of such disagreement on the day such
Eligible Valuation is received by the Calculation Agent (the earlier of such
fifth Business Day and the day of such notification, the “Notification Day”),
then no later than 10:00 a.m. (New York time) on the Business Day next following
the Notification Day, the Calculation Agent shall deliver a request (a “Back-Up
Request”) to any of the Fallback Valuation Companies to provide an Eligible
Valuation for such disputed Portfolio Asset; and

 

(iii)   the Current Price in relation to such disputed Portfolio Asset shall be:

 

(A)   if the Initial Valuation Company provides an Eligible Valuation and the
Calculation Agent does not provide a Back-Up Request, the Resolved Current Price
in relation to the Eligible Valuation provided by the Initial Valuation Company;

 

(B)   if the Calculation Agent provides a Back-Up Request and the Fallback
Valuation Company provides an Eligible Valuation for such disputed Portfolio
Asset by no later than 2:00 p.m. (New York time) on the fifth Business Day
following such request, the Resolved Current Price in relation to the Eligible
Valuation provided by the Fallback Valuation Company;

 

(C)   if the Calculation Agent provides a Back-Up Request as a result of a
Valuation Non-Delivery and the Fallback Valuation Company fails to provide an
Eligible Valuation for such disputed Portfolio Asset by no later than 2:00 p.m.
(New York time) on the fifth Business Day following such request, the Current
Price originally determined by the Calculation Agent; and

 

(D)   if the Calculation Agent provides a Back-Up Request as a result of a
Valuation Disagreement and the Fallback Valuation Company fails to provide an
Eligible Valuation for such disputed Portfolio Asset by no later than 2:00 p.m.
(New York time) on the fifth Business Day following such request, the Eligible
Valuation provided by the Initial Valuation Company.

 

If Seller has delivered a Dispute Notice, during the pendency of such dispute,
the Parties shall be required to deliver or return (as applicable) margin based
on the Calculation Agent’s determination in accordance with this Confirmation;
provided that, following resolution of the dispute, the Parties shall be
required to deliver or return (as applicable) margin based on the Current Price
so determined. For the avoidance of doubt, with respect to the dispute of the
Current Price of any Portfolio

 

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Asset, upon the determination of such Current Price in accordance with the
foregoing, the Calculation Agent shall recalculate the relevant Market Value of
the related Purchased Securities using such Current Price for such Portfolio
Asset.

 

“Eligible Valuation” shall mean, with respect to any disputed Portfolio Asset, a
valuation (which may be quoted in a range of values) for the outstanding
principal amount of such Portfolio Asset (expressed as a percentage of par) that
would be received from the sale of such Portfolio Asset on the date such
valuation is provided, exclusive of accrued interest and capitalized interest;
and

 

“Resolved Current Price” shall be, with respect to any Eligible Valuation that
is:

 

(I)    quoted as a range of values where the difference between the lowest and
highest values in such range (each expressed as a percentage of par) is an
amount greater than 5% of par, as determined by the Calculation Agent, the
lowest value in such range;

 

(II)   quoted as a range of values where the difference between the lowest and
highest values in such range (each expressed as a percentage of par) is an
amount less than or equal to 5% of par, as determined by the Calculation Agent,
the mid-point between the lowest and highest value in such range, as determined
by the Calculation Agent; and

 

(III)   not quoted as a range of values, such Eligible Valuation.

Interest on Cash Margin:

  

The interest rate applicable to Cash Margin shall be a rate per annum equal to
the overnight Federal Funds (Effective) Rate for each day cash is held as Margin
hereunder, as reported in Federal Reserve Publication H.15-519.

Substitutions:

  

No substitutions of Purchased Securities shall be permitted.

 

3    Fees

Transaction Fees:

  

On each Transaction Fee Payment Date, for each Purchased Security, Seller shall
pay to Buyer an amount equal to the applicable Transaction Fee Amount for such
Purchased Security for the related Transaction Fee Period.

Transaction Fee Payment Dates:

  

For each Purchased Security, the 9th Business Day after the end of each
Transaction Fee Period, subject to adjustment in accordance with the Business
Day Convention.

Transaction Fee Periods:

  

For each Purchased Security, each period from (and including) the 15th calendar
day of each calendar month (each, a “Monthly Date”) to, but excluding, the next
following Monthly Date; provided that (a) the initial Transaction Fee Period
shall commence on (and include) the Purchase Date for such Purchased Security
and shall end on, but exclude, the 15th day of the calendar month immediately
following such Purchase Date, and (b) the final Transaction Fee Period shall end
on (and exclude) the Repurchase Date for such Purchased Security.

Transaction Fee Amounts:

  

With respect to the Purchased Securities and any Transaction Fee Period, the
Transaction Fee Amount shall be the aggregated amount of the sums of the
following amounts for each day in such Transaction Fee Period:

 

(a)       with respect to the Outstanding Class A-R Funded Amount of the
Purchased Securities, the product of (i) the Repurchase Price of the Purchased

 

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Securities multiplied by (ii) the Applicable Transaction Fee Rate on such day
multiplied by (iii) 1/360; and

 

(b)       with respect to the portion of the Remaining Unfunded Facility
Commitment attributable to the Purchased Securities, the product of (i) the
amount of such portion multiplied by (ii) the Applicable Transaction Fee Rate on
such day multiplied by (iii) 1/360.

 

Each Transaction Fee Amount shall be payable by Seller to Buyer on a Transaction
Fee Payment Date for the related Transaction Fee Period.

Applicable Transaction Fee Rate:

  

For each Transaction Fee Period, a rate per annum equal to:

 

(a)       with respect to the Outstanding Class A-R Funded Amount of the
Purchased Securities, the sum of (i) LIBOR determined on the Reset Date for such
Transaction Fee Period plus (ii) the Drawn Spread; and

 

(b)       with respect to the portion of the Remaining Unfunded Facility
Commitment attributable to the Purchased Securities, the Undrawn Spread.

 

Where:

 

“LIBOR”, for any Reset Date, means the London Interbank Offered Rate for the
Relevant Period in respect of USD as quoted on the Bloomberg Screen BTMM Page
(or such other page as may replace the Bloomberg Screen BTMM Page) under the
heading “LIBOR-FIX-BBAM<GO>” (or any replacement heading) as of 11:00 a.m.,
London time, on the day (the “Determination Date”) that is two London banking
days preceding such date.

 

If (i) such rate does not appear on the Bloomberg Screen BTMM Page (or any
replacement page) under such heading (or any replacement heading), as of such
time on a Determination Date, (ii) a public statement or publication of
information has been made by or on behalf of the administrator of LIBOR or a
governmental authority or regulatory supervisor having jurisdiction or
regulatory authority over Buyer, identifying a date after which LIBOR shall no
longer be used or shall no longer be representative for determining interest
rates for loans, or (iii) Buyer provides notice to Seller of a replacement rate
that is appropriate for transactions that are similar to those contemplated
under this Confirmation with similarly situated counterparties, LIBOR shall be
deemed to be such rate as determined by the Calculation Agent.

 

For any Transaction Fee Period that is less than the Relevant Period, LIBOR
shall be determined through the use of straight line interpolation by reference
to two rates based on LIBOR, one of which shall be determined as if the Relevant
Period were the period of time for which rates are available next shorter than
the length of the Transaction Fee Period and the other of which shall be
determined as if the Relevant Period were the period of time for which rates are
available next longer than the length of the Transaction Fee Period.

 

“Relevant Period” means one month.

 

“Reset Date” with respect to any Transaction Fee Period, means the first day of
such Transaction Fee Period.

 

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“Drawn Spread” means 3.15%.

 

“Undrawn Spread” means 0.75%.

 

4    Miscellaneous

Voting Rights:

  

Where any voting or consent rights fail to be exercised in relation to any
Purchased Securities, Buyer shall be entitled to exercise such voting or consent
rights in its sole discretion and shall not have any obligation to arrange for
voting or consent rights to be exercised in accordance with the instructions of
Seller.

Business Day:

  

Notwithstanding paragraph 2(f) of the Agreement, “Business Day” means any day on
which commercial banks are open for general business (including dealings in
foreign exchange and foreign currency deposits) in New York, Houston and London
and that is a TARGET Settlement Day, other than a Saturday, Sunday or other day
which the New York Stock Exchange or banks are authorized or obligated by law or
executive order to close in New York, New York.

Business Day Convention:

  

The convention for adjusting any relevant date if it would otherwise fall on a
day that is not a Business Day so that such date will be the first following day
that is a Business Day.

Unpaid Amounts:

  

For the avoidance of doubt, on the final Repurchase Date (whether occurring
prior to, on, or after, the scheduled Repurchase Date, and whether occurring as
a result of an Event of Default, a Prepayment Date, or otherwise), if there are
amounts that became payable by one Party to the other Party on or prior to such
Repurchase Date and which remain unpaid as at such Repurchase Date, such amounts
shall remain an outstanding obligation of such Party and shall be netted with
and set off against the amounts otherwise payable by the Parties on such
Repurchase Date.

Interest on Amounts Payable:

  

Any amount due from one party to the other following the occurrence of an Event
of Default shall be paid together with (to the extent permitted under applicable
law) interest thereon (both before and after judgment) in USD, from (and
including) the date on which such amount was originally due to (but excluding)
the date such amount is paid, at a rate per annum equal to the overnight Federal
Funds (Effective) Rate for each day such amount remains outstanding (as reported
in Federal Reserve Publication H.15-519) plus 1% per annum. Such interest will
accrue daily without compounding based on the actual number of days elapsed. The
provisions of this paragraph shall supersede any conflicting provisions in
paragraph 12 of the Agreement.

Tax Matters:

  

(a)       For (and only for) U.S. Federal income tax purposes, each Party
agrees: (i) to treat the purchase hereunder of Purchased Securities as if Buyer
had made a loan to Seller secured by such Purchased Securities, (ii) to treat
Seller as beneficial owner of such Purchased Securities, and (iii) not to take
any inconsistent position on any related tax return, unless otherwise required
by applicable law.

 

(b)       Notwithstanding anything else in the Agreement, if the Defaulting
Party exercises its right to assign rights to payment under paragraph 16(b) of
the Agreement following an Event of Default, if any withholding or other taxes
are imposed on payments to any assignee, the payor’s obligation to gross-up any
such payment in respect of such tax to such assignee shall be limited to the
amount of any gross-up it would have been obligated to pay immediately before
any such

 

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assignment occurred.

 

(c)       Each party shall provide the other party with a properly executed IRS
Form W-8 or W-9 (as applicable). If either Party exercises its right to assign
rights to payment under paragraph 16(b) of the Agreement, prior to being
entitled to receive any gross-up payments in respect of any taxes withheld, any
assignee will be required to submit to the payor an executed, complete IRS Form
W-8 or W-9 (as applicable) establishing any available exemption or reduction
from any US withholding taxes that may be imposed on the payment assigned.

Certain Covenants of Seller:

  

(i)       Seller agrees that Seller will not permit any securities to be issued
under the Indenture to any person or entity other than Seller and that Seller
will not direct or permit the Issuer to issue any securities other than in
conjunction with a Purchase Date or otherwise as required under the Indenture or
other transaction documents.

 

(ii)      Seller agrees that Seller will not sell, transfer or otherwise dispose
of any securities issued under the Indenture (or any interest therein) other
than pursuant to the Transaction.

 

(iii)    Seller agrees that if CM Investment Partners LLC ceases to be a
business development company (within the meaning of the U.S. Investment Company
Act of 1940) and to file publicly-available financials as required of a public
business development company, Seller will provide, or cause to be provided, to
Buyer quarterly unaudited financial statements within 60 days of each
quarter-end and annual audited financial statements within 120 days of the
year-end, prepared in accordance with generally accepted accounting principles
(as in effect in the relevant jurisdiction) (such covenant, the “CM Finance
Financials Requirement”).

 

(iv)      Seller shall maintain an Asset Coverage Ratio of at least 150%.

Notification of Events of Default:

  

Each Party shall notify the other Party as soon as reasonably practicable upon
becoming aware of the occurrence of any Event of Default with respect to such
notifying Party or event which with the giving of notice and/or lapse of time
could become an Event of Default with respect to such notifying Party.

Representations and acknowledgements:

  

Unless agreed to the contrary expressly and in writing in this Confirmation and
notwithstanding any communication that each Party (and/or its Affiliates) may
have had with the other Party or any of its Affiliates, in respect of the
Transaction subject to this Confirmation, each Party will be deemed to represent
to the other Party on the Trade Date, the Amendment Effective Date, each
Purchase Date of the Transaction, and each date on which the Transaction is
terminated (in whole or in part) that:

 

(i)       it is entering into or terminating (in whole or in part) the
Transaction for its own account;

 

(ii)      none of the other Party or any of its Affiliates or agents are acting
as a fiduciary or financial adviser for it;

 

(iii)    it is a sophisticated investor that has made its own independent
decisions to enter into the Transaction, as to whether the Transaction is
appropriate or proper for it and as to any related investment, hedging and/or
trading based upon its own judgment and upon advice from such legal, regulatory,
tax, financial, accounting and other advisers as it has deemed necessary, and
not upon any view expressed by the

 

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other Party or any of its Affiliates or agents;

 

(iv)      it is not relying on any communication (written or oral) of the other
Party or any Affiliate or agent thereof except those expressly set forth in the
Agreement, except that nothing in the Agreement will limit or exclude any
liability of a party for fraud;

 

(v)       it is capable of assessing the merits of and understanding (on its own
behalf or through independent professional advice), and understands and accepts,
the terms, conditions and risks of the Transaction, and is also capable of
assuming, and assumes, the risks of the Transaction;

 

(vi)      having made all necessary enquiries with relevant authorities, its
entry into or termination (in whole or in part) of the Transaction will not
contravene any applicable law, decree, regulation, regulatory guidance,
regulatory request, regulatory briefing or order of any government or
governmental body (including any court or tribunal); and

 

(vii)    to the extent required to do so, it has notified relevant authorities,
in a manner acceptable to such authorities, of its entry into the Transaction.

 

Unless agreed to the contrary expressly and in writing in this Confirmation and
notwithstanding any communication that each Party (and/or its Affiliates) may
have had with the other Party, in respect of the Transaction subject to this
Confirmation, each Party will be deemed to acknowledge on the date on which it
enters into the Transaction that:

 

(a)       none of the other Party or its Affiliates provides investment, tax,
accounting, legal or other advice in respect of the Transaction;

 

(b)       it has been given the opportunity to obtain information from the other
Party concerning the terms and conditions of the Transaction necessary in order
for it to evaluate the merits and risks of the Transaction; provided that,
notwithstanding the foregoing, (i) it and its advisors are not relying on any
communication (written or oral and including, without limitation, opinions of
third party advisors) of the other Party or its Affiliates as (A) legal,
regulatory, tax, business, investments, financial, accounting or other advice,
(B) a recommendation to enter into the Transaction or (C) an assurance or
guarantee as to the expected results of the Transaction; it being understood
that information and explanations related to the terms and conditions of the
Transaction are made incidental to the other Party’s business and shall not be
considered (x) legal, regulatory, tax, business, investments, financial,
accounting or other advice, (y) a recommendation to enter into the Transaction
or (z) an assurance or guarantee as to the expected results of the Transaction
and (ii) any such communication should not be the basis on which such Party has
entered into the Transaction, and should be independently confirmed by such
Party and its advisors prior to entering into the Transaction;

 

(c)       none of the Parties or any Affiliate thereof has any obligation to,
and it will not, select securities or transfers of currency, with regard to the
needs or interests of any person other than itself, and each Party and its
Affiliates may accept deposits from, make loans or otherwise extend credit to,
and generally engage in any kind of commercial or investment banking business
with the issuer of any Purchased Security or its affiliates or any other person
or entity having obligations relating to the Purchased Securities and may act
with respect to such business in the same manner as if the Transaction did not
exist, regardless of whether any such action

 

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may have an adverse effect on either Party’s position under the Transaction;

 

(d)       each Party and its Affiliates may, whether by virtue of the types of
relationships described above or otherwise, at the date hereof or at times
hereafter be in possession of information in relation to the Issuer which is or
may be material in the context of the Transaction and which is or may not be
known to the general public or to one or both of the Parties, and the
Transaction does not create any obligation on the part of any of the Parties and
their respective Affiliates to disclose to either Party any such relationship or
information (whether or not confidential);

 

(e)       neither Party makes any representations or warranties to the other in
connection with, and shall have no responsibility with respect to, the accuracy
of any statements, warranties or representations made in or in connection with
the Purchased Securities, any information contained in any document filed by the
issuer of the Purchased Securities (the “Issuer”) with any exchange or with any
governmental entity regulating the purchase and sale of securities, the solvency
or financial condition of the Issuer, or the legality, validity, binding effect
or enforceability of the obligations of the Issuer in respect of the Purchased
Securities. Each Party acknowledges that it has, independently and without
reliance on the other and based on such documents and information as it has
deemed appropriate, made its own credit analysis and decision to enter into the
Transaction and will continue to be responsible for making its own independent
appraisal of the business, affairs and financial condition of the Issuer; and

 

(f)       the Transaction does not create either a direct or indirect obligation
of the Issuer owing to Seller or a direct or indirect participation in any
obligation of the Issuer owing to Buyer. The Seller acknowledges that the Seller
shall not have any voting rights with respect to the Purchased Securities or any
other rights under or with respect to the Purchased Securities, other than as
expressly set forth herein.

 

Each Party acknowledges and agrees that (i) the Transaction to which this
Confirmation relates is (x) a “securities contract”, as defined in Section 741
of the federal Bankruptcy Code, Title 11 of the United States Code, as amended
(the “Bankruptcy Code”) and (y) a “repurchase agreement” as that term is defined
in Section 101 of Title 11 of the Bankruptcy Code (except insofar as the type of
Securities subject to the Transaction or the term of the Transaction would
render such definition inapplicable) and (ii) the exercise by either Party of
any right under the Agreement to cause the liquidation, termination or
acceleration of the Transaction, because of a condition of the kind specified in
Section 365(e)(1) of the Bankruptcy Code shall not be stayed, avoided, or
otherwise limited by operation of any provision of the Bankruptcy Code or by
order of a court or administrative agency in any proceeding under the Bankruptcy
Code.

Additional Seller Representations:

  

The following additional paragraph 9(A), subsections (i) and (ii) shall be
inserted into the Agreement:

 

“9(A). Additional Representations and Notice.

 

(i) Seller Representations. Seller represents and warrants on and as of the date
hereof and on and as of each date this Agreement or any Transaction remains
outstanding:

 

(A)      No Prohibited Transactions. Seller represents and warrants that Seller
is not an “employee benefit plan” subject to Title I of the Employee Retirement
Income Security Act of 1974, as amended (“ERISA”) or a

 

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“plan” within the meaning of Section 4975 of the Internal Revenue Code of 1986,
as amended (the “Code”), and all investors in Seller acquire “publicly-offered
securities” within the meaning of 29 CFR § 2510.3-101. Any subsequent permitted
assignee of Seller will be deemed to have represented and warranted, that (i) no
portion of the assets used by such assignee to either (x) acquire and hold the
Purchased Securities or (y) enter into or assume the obligations under the
Transaction evidenced hereby constitutes the assets of any employee benefit plan
subject to Title I of ERISA, a “governmental plan” within the meaning of
Section 3(32) of ERISA, or a “plan” within the meaning of Section 4975(e)(1) of
the Code or (ii) both the purchase and holding of such Purchased Securities by
such assignee and the assumption of the obligations under the Transaction
evidenced hereby will constitute neither (x) a non-exempt “prohibited
transaction” under (and as defined in) Section 406 of ERISA or Section 4975 of
the Code nor (y) a similar violation under any applicable similar federal,
state, local, non-U.S. or other law, rule or regulation.

 

(B)       Notice Requirement. Seller agrees to notify Buyer immediately if any
time it learns or discovers facts at variance with the foregoing representations
and warranties.

 

(ii) Seller represents and warrants that its acquisition of the Purchased
Securities complied with the terms of the Indenture.

 

(iii) Seller represents and warrants that either (i) the Purchased Securities
are not required to be retained by the Collateral Manager (or a “majority owned
affiliate” of the Collateral Manager) pursuant to Section 15G of the Securities
Exchange Act of 1934 and the rules promulgated thereunder (the “Risk Retention
Rules”) or (ii) the Purchased Securities are required to be retained by the
Collateral Manager (or a “majority owned affiliate” of the Collateral Manager)
pursuant to the Risk Retention Rules and the entry by the Collateral Manager (or
a “majority owned affiliate” of the Collateral Manager) into the transactions
contemplated by the Collateral Management Agreement will not violate or conflict
with the Risk Retention Rules.

 

The first sentence in the last paragraph of paragraph 9 of the Agreement shall
be amended by adding “on the Amendment Effective Date,” after the words “On the
date on which any Transaction is entered into pursuant hereto,”.

Transfer; Assignment; Amendment;

  

Neither Buyer nor Seller will have the right to transfer, assign, amend, modify
or supplement the Agreement or this Confirmation or any interest or obligation
or right or benefit received in or under the Agreement or this Confirmation
without the prior written consent of each party.

Disapplication and Modification of Provisions of the Annex I:   

The following provisions of Annex I to the Agreement shall not apply to the
Transaction evidenced by this Confirmation:

 

Parts 1(a), 1(b), 1(d)(i), 1(d)(iii), 1(d)(iv), 1(n), 2(b), and 2(c) of Annex I.

Counterparts Clause:

  

This Confirmation may be signed or executed in any number of counterparts, and
by each Party on separate counterparts. Each counterpart is an original but
shall not be effective until each Party has executed and delivered at least one
counterpart. All counterparts together shall constitute one and the same
instrument. This has the same effect as if the signatures on the counterparts
were on a single original of this Confirmation. Delivery of an executed
counterpart signature page of this

 

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Confirmation by email (portable document format (“pdf”)) or facsimile copy shall
be as effective as delivery of a manually executed counterpart of this
Confirmation.

No effect, Inconsistency:

  

The terms set forth in the Confirmation for this trade shall apply only to the
Transaction.

Buyer’s Bank Account Details:

  

Account Name: UBS AG, Stamford Branch

SWIFT BIC Code: UBSWUS33

 

For the benefit of:

 

UBS AG, London Branch

SWIFT BIC Code: UBSWGB2L

 

Account No.: /101-WA41275-000

Seller’s Bank Account Details:

  

As specified separately to Buyer from Seller.

Notices:

  

If to Seller:

 

Address: Investcorp Credit Management BDC, Inc.

65 East 55th Street, 15th Floor
New York, New York 10022
Attention: Rocco DelGuercio and Matt Bannon
Tel: (212) 380-5904
Email: rdelguercio@Investcorp.com, mmauer@investcorp.com and
mbannon@Investcorp.com

 

If to Buyer:

 

As specified in the Annex to the Agreement.

Governing Law:

  

This Confirmation and any non-contractual obligations arising out of or in
connection with this Confirmation or this Transaction shall be governed by, and
interpreted in accordance with, the laws of England.

 

Each party irrevocably agrees that the courts of England or the courts of the
State of New York located in the City and County of New York or in the United
States District Court for the Southern District of New York (the “New York
Courts”) shall have exclusive jurisdiction to hear and decide any suit, action
or proceedings, and to settle any disputes, which may arise out of or in
connection with this the Transaction, including without limitation to any
disputes arising out of or in connection with the existence, creation, validity,
effect, interpretation performance and/or termination of the legal relationships
established by this Confirmation and to any disputes arising out of any
non-contractual obligations arising out of or in connection with this
Confirmation, (respectively, “Proceedings” and “Disputes”) and, for these
purposes, each party irrevocably submits to the jurisdiction of the courts of
England or the New York Courts.

 

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Each party irrevocably waives any objection which it might at any time have to
the courts of England or the New York Courts being nominated as the fora to hear
and decide any Proceedings and to settle any Disputes and agrees not to claim
that the courts of England or the New York Courts are not convenient or
appropriate fora.

 

Buyer hereby appoints the person identified in Annex I as its agent to receive
on its behalf service of process in such courts. If such agent ceases to be its
agent, Buyer shall promptly appoint, and notify Seller of the identity of, a new
agent in England. If Buyer fails to appoint such an agent, Buyer agrees that
Seller shall be entitled to appoint one on behalf of Buyer at the expense of
Buyer.

 

Seller hereby appoints the person identified in Annex I as its agent to receive
on its behalf service of process in such courts. If such agent ceases to be its
agent, Seller shall promptly appoint, and notify Buyer of the identity of a new
agent in England. If Seller fails to appoint such an agent, Seller agrees that
Buyer shall be entitled to appoint one on behalf of Seller at the expense of
Seller.

 

Each party shall deliver to the other, within 30 days of the date of this
Confirmation in the case of the appointment of a person identified in Annex I or
of the date of the appointment of the relevant agent in any other case, evidence
of the acceptance by the agent appointed by it pursuant to this paragraph of
such appointment.

 

Any Affiliate of Buyer, performing obligations under or in connection with this
Confirmation, shall be entitled to the benefits of and shall be subject to the
Governing Law provisions of this Confirmation..

 

Waiver of Jury Trial. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO
TRIAL BY JURY IN ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO
THIS CONFIRMATION OR ANY TRANSACTION, AND ACKNOWLEDGES THAT THIS WAIVER IS A
MATERIAL INDUCEMENT TO THE OTHER PARTY’S ENTERING INTO THIS CONFIRMATION.

 

Paragraph 17 of the Agreement shall not apply to this Transaction.

 

5    Additional Defined Terms

 

The following terms shall have the respective meanings specified below:

 

“Account” has the meaning given to such term in the Indenture.

 

“Aggregate Portfolio Par Value” means, on any date of determination, the
Aggregate Principal Balance of (a) all Portfolio Assets held by the Issuer plus
(b) all Cash credited or required to be credited to the Principal Collection

 

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Subaccount and Eligible Investments acquired with such Cash.

“Aggregate Principal Balance” means, when used with respect to all or a portion
of the Portfolio Assets or the Collateral, the sum of the Principal Balances of
all or of such portion of the Portfolio Assets or Collateral, as applicable.

“Amendment Date” means, with respect to any Portfolio Asset, the effective date
of any amendment or action described in Section 2(h) of the Collateral
Management Agreement.

“Approved Dealer” means each of Bank of America Securities LLC; Barclays Bank
plc; BNP Paribas; Cantor Fitzgerald; Castle Oak; CIBC World Markets, Inc.;
Citibank, N.A.; Credit Agricole Cheuveux North America, Inc.; Credit Suisse
First Boston LLC; Deutsche Bank Securities Inc.; Goldman Sachs & Co.;
Guggenheim; Global Hunter; Jefferies & Company Inc.; JPMorgan Chase Bank, N.A.;
Macquarie; Miller Tabak Roberts Securities, LLC; Morgan Stanley & Co.; Nomura;
RBC Capital Markets Corp.; SG Americas Securities LLC; Sterne, Age & Leach,
Inc.; The Royal Bank of Scotland plc.; UBS AG; Wachovia Capital Markets LLC;
provided that (i) the Calculation Agent may at any time, upon written notice to
Seller, delete any name listed in the foregoing list so long as such deletion is
consistent with the general application of its internal credit and risk policies
with respect to such Approved Dealer (and not designed to circumvent the rights
of Seller hereunder) and (ii) the parties may, at any time, agree in writing to
add or remove an Approved Dealer to or from the foregoing list.

“Asset Coverage Ratio” has the meaning given to such term in the Indenture.

“Asset Eligibility Criteria” has the meaning given to such term in the
Indenture.

“Bonds” has the meaning given to such term in the Indenture.

“Cash” has the meaning given to such term in the Indenture.

“Class A Note Repo Confirmation” means the Confirmation in respect of Repurchase
Transaction, as amended and restated as of the Amendment Effective Date, between
Investcorp Credit Management BDC, Inc. and UBS with respect to which the
Purchased Securities (as defined therein) are the Class A Notes.

“Class A Notes” means the Class A-1 Notes.

“Class A-1 Notes” means the Class A-1 Notes issued under the Indenture.

“Class A-R Note Cash-Out Percentage” means the quotient (expressed as a
percentage) equal to:

(a) the Repurchase Price under this Transaction

divided by

(b) the sum of (i) the Repurchase Price under this Transaction plus (ii) the
aggregate Repurchase Prices under (and as defined in) the Class A Note Repo
Confirmation.

“Class A-R Notes” means the Class A-R Notes issued under the Indenture.

“Collateral” has the meaning given to such term in the Indenture.

“Collateral Management Agreement” has the meaning given to such term in the
Indenture.

“Collateral Manager” has the meaning given to such term in the Indenture.

“Consolidated Leverage Ratio” means, as of any date of determination with
respect to any Portfolio Asset

 

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Obligor and a particular Portfolio Asset of such Portfolio Asset Obligor, the
ratio of:

(a)       the Principal Balances of such Portfolio Asset and the outstanding
principal amount of all other Indebtedness of such Portfolio Asset Obligor and
its Subsidiaries that is of equal or higher seniority with such Portfolio Asset
and is secured by a similar ranking lien or security interest in the same
collateral as of such date of calculation that would be stated on a consolidated
balance sheet (excluding any notes thereto); provided that, for purposes of this
definition only, the amount of Indebtedness shall be determined only to the
extent that it has been advanced such that any undrawn amount thereunder shall
not constitute Indebtedness for purposes of this clause (a); to

(b)       EBITDA of such Portfolio Asset Obligor for the most recent four fiscal
quarters (or last twelve months if available) for which financial reports are
available for such Portfolio Asset Obligor.

“Cov-Lite Loan” means a Loan (a) which is a Non-Markit Loan and (b) with respect
to which the Underlying Instrument does not include any financial covenants with
which compliance is determined on an ongoing maintenance basis.

“Daily Report” has the meaning given to such term in the Indenture.

“Defaulted Obligation” has the meaning given to such term in the Indenture.

“Delayed-Draw Loan” has the meaning given to such term in the Indenture.

“EBITDA” means with respect to any Portfolio Asset and any period, (a) the
meaning of the term “Adjusted EBITDA”, the term “EBITDA” or any comparable
definition in the related Underlying Instrument for such period and Portfolio
Asset Obligor, as reported for such period pursuant to the related Underlying
Instrument, and (b) in any case that the term “Adjusted EBITDA”, the term
“EBITDA” or such comparable definition is not defined in such Underlying
Instrument, the sum of (i) the consolidated net income for such period of the
relevant Portfolio Asset Obligor on such Portfolio Asset, plus (ii) to the
extent deducted in calculating such consolidated net income, the sum for such
period of all income tax expense, interest expense, depreciation and
amortization expense and all other non-cash charges, in the case of each of the
foregoing clauses, as reported for such period pursuant to (and in accordance
with the relevant definitions contained in) the related Underlying Instrument;
provided that (x) the relevant Portfolio Asset Obligor referred to above in this
definition shall be the Portfolio Asset Obligor for which consolidated financial
statements are required to be delivered under the related Underlying Instrument
(and, if there is more than one such Portfolio Asset Obligor, for the Portfolio
Asset Obligor with the greatest consolidated aggregate indebtedness for borrowed
money as of the last day of such period) and (y) if the Calculation Agent
determines on a commercially reasonable basis that “Adjusted EBITDA” or “EBITDA”
as reported for such period pursuant to the related Underlying Instrument is not
computed in accordance with generally accepted financial practice for similar
transactions, then “EBITDA” shall mean “Consolidated EBITDA” (determined on a
consolidated basis based upon the Calculation Agent’s selection in good faith of
a definition of “Consolidated EBITDA” that accords with generally accepted
financial practice) in relation to the relevant Portfolio Asset Obligor and its
consolidated subsidiaries for such period.

“Eligible Investments” has the meaning given to such term in the Indenture.

“Expense Account” has the meaning given to such term in the Indenture.

“Fallback Valuation Company” means any of CTS Capital Advisors, LLC, Duff &
Phelps, Valuation Research Corporation, GLC Advisors & Co., Houlihan Capital,
Houlihan Lokey or their respective successors.

“Governmental Authority” means the government of the United States of America or
any other nation, or of 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 supra-national bodies such as the European

 

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Union or the European Central Bank).

“Illiquid Loan” means a Loan which is not a Liquid Loan.

“Inclusion” means a substitution or contribution of Portfolio Assets to the
Issuer pursuant to the Issuer Contribution Agreement or any other acquisition of
Portfolio Assets by the Issuer.

“Inclusion Date” means (a) in the case of a substitution or contribution of
Portfolio Assets to the Issuer pursuant to the Issuer Contribution Agreement,
the settlement date of substitution or contribution or (b) in the case of any
other acquisition thereof by the Issuer, the Portfolio Asset Trade Date for the
acquisition thereof by the Issuer.

“Indebtedness” has the meaning given to such term in the Indenture.

“Indenture” means the Eighth Amended and Restated Indenture dated as of
September 30, 2020, between CM Finance SPV Ltd. and U.S. Bank National
Association, as trustee, as amended, supplemented or otherwise modified from
time to time.

“Indenture Event of Default” means an “Event of Default” (as defined in the
Indenture) occurs with respect to the Issuer under the Indenture.

“Initial Valuation Company” means Lincoln International LLC.

“Issuer Contribution Agreement” has the meaning given to such term in the
Indenture.

“Lien” has the meaning given to such term in the Indenture.

“Liquid Loan” means any Loan which is the subject of at least two bid quotations
as reported on Markit (or any successor nationally recognized loan pricing
service designated by the Buyer).

“Liquidation Agent” has the meaning given to such term in the Indenture.

“Loan” has the meaning given to such term in the Indenture.

“Markit” means Markit Ltd. and any of its subsidiaries, or any successor
thereto.

“Maximum RCN Facility Funding Commitment” has the meaning given to such term in
the Revolving Credit Note Agreement.

“Middle Market Loan” has the meaning given to such term in the Indenture.

“Moody’s” has the meaning given to such term in the Indenture.

“Non-Markit Loan” means any Loan for which prices are not reported on Markit (or
any successor nationally recognized loan pricing service designated by the
Buyer).

“Non-Senior Secured Bond” means any Bond that is not a Senior Secured Bond.

“Outstanding Class A-R Funded Amount” has the meaning given to such term in the
Revolving Credit Note Agreement.

“Portfolio Asset” has the meaning given to such term in the Indenture, provided
that when the relevant asset is held by the Issuer, this definition shall be
subject to “Determination of When Assets are Held” above.

“Portfolio Asset Obligor” has the meaning given to such term in the Indenture.

 

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“Portfolio Asset Trade Date” means the date on which the Issuer enters into an
agreement to purchase or sell a Portfolio Asset pursuant to an Issuer Order, as
such term is defined in the Indenture, given by the Collateral Manager.

“Principal Balance” has the meaning given to such term in the Indenture.

“Priority Loan Leverage Ratio” means of any date of determination with respect
to any Portfolio Asset Obligor and a particular Portfolio Asset of such
Portfolio Asset Obligor which is a Senior Secured Last Out Loan, the ratio of:

(a)       the Principal Balance of the Senior Secured First Out Loan relating to
such Senior Secured Last Out Loan, to

(b)       EBITDA for the four fiscal quarters (or last twelve months if
available) for which financial reports are available for such Portfolio Asset
Obligor

“Purchase Amount” has the meaning given to such term in the Indenture.

“Priority Revolving Loan” means, as of any date of determination with respect to
any Portfolio Asset Obligor and a particular Portfolio Asset of such Portfolio
Asset Obligor, the Indebtedness of such Portfolio Asset Obligor and its
Subsidiaries in the form of a Revolver Loan that when it is drawn (x) ranks
senior to such Portfolio Asset and (y) is secured by a senior ranking lien or
security interest in a portion of the same collateral as of such date of
calculation that would be stated on a consolidated balance sheet.

“Priority Revolving Loan Leverage Ratio” means, as of any date of determination
with respect to any Portfolio Asset Obligor and a particular Portfolio Asset of
such Portfolio Asset Obligor, the ratio of:

(a)       the outstanding principal amount of the Priority Revolving Loan(s)
relating to such Portfolio Asset determined on the assumption that the maximum
aggregate amount that can be borrowed under such Priority Revolving Loan(s) has
already been fully advanced such that any undrawn amount thereunder shall
constitute outstanding principal amount for purposes of this definition; to

(b)       EBITDA of such Portfolio Asset Obligor for the most recent four fiscal
quarters (or last twelve months if available) for which financial reports are
available for such Portfolio Asset Obligor.

“Remaining Unfunded Facility Commitment” has the meaning given to such term in
the Revolving Credit Note Agreement.

“Revolver Loan” has the meaning given to such term in the Indenture.

“Revolving Credit Note Agreement” has the meaning given to such term in the
Indenture.

“S&P” has the meaning given to such term in the Indenture.

“Second Lien Liquid Loan” means any Liquid Loan that is a Second Lien Loan.

“Second Lien Loan” means any Illiquid Loan that is either (a) a Traditional
Second Lien Loan or (b) a Senior Secured Last Out (Type II) Loan. .

“Senior Secured (Large Cap) Loan” means any Senior Secured Loan that (a) has an
applicable margin or other stated coupon less than (or equal to) 6.0%, including
for such purposes any non-cash portion thereof but excluding for such purposes
any portion thereof derived from the London interbank offered rate, base rate or
other applicable fixed or floating reference rate, (b) has Portfolio Asset
Obligor(s) with EBITDA for the most recent four fiscal quarters (or last twelve
months if available) for which financial reports are available greater than or
equal to $50,000,000, (c) has a Consolidated Leverage Ratio with respect to such
Senior Secured Loan and the related

 

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Portfolio Obligor(s) which is less than or equal to 5.2x, (d) if there is a
Priority Revolving Loan with respect to such Senior Secured Loan, has a Priority
Revolving Loan Leverage Ratio with respect to such Senior Secured Loan and the
related Portfolio Asset Obligor(s) which is less than or equal to 1.75x, and
(e) is not a Senior Secured Liquid Loan.

“Senior Secured (Type I) Loan” means any Senior Secured Loan that (a) has an
applicable margin or other stated coupon less than (or equal to) 9.0%, including
for such purposes any non-cash portion thereof but excluding for such purposes
any portion thereof derived from the London interbank offered rate, base rate or
other applicable fixed or floating reference rate, (b) has Portfolio Asset
Obligor(s) with EBITDA for the most recent four fiscal quarters (or last twelve
months if available) for which financial reports are available greater than or
equal to $25,000,000, (c) has a Consolidated Leverage Ratio with respect to such
Senior Secured Loan and the related Portfolio Obligor(s) which is less than or
equal to 5.2x, (d) if there is a Priority Revolving Loan with respect to such
Senior Secured Loan, has a Priority Revolving Loan Leverage Ratio with respect
to such Senior Secured Loan and the related Portfolio Asset Obligor(s) which is
less than or equal to 1.75x, (e) is not a Senior Secured (Large Cap) Loan,
(f) is not a Cov-Lite Loan and (g) is not a Senior Secured Liquid Loan.

“Senior Secured (Type I CL) Loan” means any Senior Secured Loan (a) which would
be a Senior Secured (Type I) Loan but for the fact that such Loan is a Cov-Lite
Loan and (b) has a Consolidated Leverage Ratio with respect to such Senior
Secured Loan and the related Portfolio Obligor(s) which is less than or equal to
3.5x.

“Senior Secured (Type II) Loan” means any Senior Secured Loan that (a) has an
applicable margin or other stated coupon less than (or equal to) 9.0%, including
for such purposes any non-cash portion thereof but excluding for such purposes
any portion thereof derived from the London interbank offered rate, base rate or
other applicable fixed or floating reference rate portion thereof, (b) has
Portfolio Asset Obligor(s) with EBITDA for the most recent four fiscal quarters
(or last twelve months if available) for which financial reports are available
less than $25,000,000 and equal to or greater than $15,000,000, (c) has a
Consolidated Leverage Ratio with respect to such Senior Secured Loan and the
related Portfolio Obligor(s) which is less than or equal to 5.2x, (d) if there
is a Priority Revolving Loan with respect to such Senior Secured Loan, has a
Priority Revolving Loan Leverage Ratio with respect to such Senior Secured Loan
and the related Portfolio Asset Obligor(s) which is less than or equal to 1.75x,
(e) is not a Cov-Lite Loan and (f) is not a Senior Secured Liquid Loan.

“Senior Secured (Type III) Loan” means any Senior Secured Loan that (a) has
Portfolio Asset Obligor(s) with EBITDA for the most recent four fiscal quarters
(or last twelve months if available) for which financial reports are available
of less than $15,000,000 and (b) is not a Senior Secured Liquid Loan.

“Senior Secured (Type IV) Loan” means any (i) Senior Secured Loan which would
otherwise be a Senior Secured (Type I) Loan or a Senior Secured (Type II) Loan
but for the fact that such Loan does not meet the requirements set forth in
clause (a), (c) or (d) of the definition of “Senior Secured (Type I) Loan” or
“Senior Secured (Type II) Loan”, as applicable, and (ii) Senior Secured Loan
which would otherwise be a Senior Secured (Type I CL) Loan but for the fact that
such Loan does not meet the requirements set forth in clause (b) of the
definition of “Senior Secured (Type I CL) Loan”.

“Senior Secured Bond” means any Bond that (i) is not secured solely or primarily
by common stock or other equity interests, (ii) if it is subordinated by its
terms, is subordinated only to indebtedness for borrowed money, trade claims,
capitalized leases or other similar obligations and (iii) is secured by a valid
first priority perfected security interest or lien in, to or on specified
collateral securing the obligor’s obligations under such obligation

“Senior Secured First Out Loan” has the meaning assigned to such term in the
definition of “Senior Secured Last Out Loan” herein.

“Senior Secured Last Out Loan” means any Loan that would be a Senior Secured
Loan but for the fact that its terms provide that the payment of principal
thereon, either prior to or after any default, event of default, financial
covenant test failure or other event, is to occur after the payment of principal
of any other term loan(s) (each such other term loan, a “Senior Secured First
Out Loan”) of the Portfolio Asset Obligor of such loan.

 

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“Senior Secured Last Out (Type I) Loan” means any Senior Secured Last Out Loan
for which (a) the Priority Loan Leverage Ratio with respect to such Senior
Secured Last Out Loan and the related Portfolio Obligor(s) is less than 1.25x
and (b) the Consolidated Leverage Ratio with respect to such Senior Secured Last
Out Loan and the related Portfolio Obligor(s) is less than 4.5x.

“Senior Secured Last Out (Type II) Loan” means any Senior Secured Last Out Loan
that is not a Senior Secured Last Out (Type I) Loan.

“Senior Secured Liquid Loan” means any Senior Secured Loan that is a Liquid
Loan.

“Senior Secured Loan” means any Loan that (i) is not (and by its terms is not
permitted to become) subordinated in right of payment, liens or otherwise to any
other obligation of the Portfolio Asset Obligor(s) of such Loan, including any
other obligation under the same credit facility, other than any Priority
Revolving Loan, and (ii) is secured by a valid first priority perfected security
interest in or Lien on collateral consisting of all or substantially all the
assets of the Portfolio Asset Obligor(s), other than those assets securing any
Priority Revolving Loan, as to which it is secured by a valid second priority
perfected security interest in or Lien on collateral consisting of all the
assets securing such Priority Revolving Loan.

“TARGET Settlement Day” means any day on which TARGET (the Trans-European
Automated Real-time Gross settlement Express Transfer system) is open.

“Transaction Documents” has the meaning given to such term in the Indenture.

“Traditional Second Lien Loan” means any Loan that (a) is an Illiquid Loan,
(b) would be Senior Secured Loan but for the fact that it is subordinated (in
right of payment, liens or otherwise) to a Senior Secured Loan of the Portfolio
Asset Obligor(s) other than a Priority Revolving Loan, (c) is secured by a valid
second-priority perfected security interest in or Lien on (second only to a
security interest or Lien securing a Senior Secured Loan) collateral consisting
of all or substantially all the assets of the Portfolio Asset Obligor(s) (and in
any event substantially all its assets securing any other Indebtedness); and
(d) is not secured solely or primarily by common stock or other equity
interests; provided that the limitation set forth in this clause (d) shall not
apply with respect to a Loan made to a parent entity that is secured solely or
primarily by the stock of one or more of the subsidiaries of such parent entity
to the extent that (x) the granting by any such subsidiary of a Lien on its own
property would violate law or regulations applicable to such subsidiary (whether
the obligation secured is such Loan or any other similar type of Indebtedness
owing to third parties) and (y) its own property is not subject to a Lien
securing any Indebtedness.

“TRS Termination Agreement” means the termination agreement dated as of the date
hereof between Buyer and Seller relating to the termination of certain total
return swap transactions referencing the Class A Notes and the total return swap
transactions referencing the Class A-R Notes.

“Underlying Instrument” has the meaning given to such term in the Indenture.

“Utilization Percentage” means the quotient (expressed as a percentage) of
(a) Outstanding Class A-R Funded Amount divided by (b) Maximum RCN Facility
Funding Commitment.

[signatures follow on the next page]

 

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By executing this Confirmation and returning it to us, Seller confirms that the
foregoing correctly sets out the terms of the agreement of the Parties.

Yours faithfully,

 

UBS AG, LONDON BRANCH,

In its individual capacity and as Calculation Agent

 

By: _________________________________

Name:

Title:

 

By: _________________________________

Name:

Title:

 

Investcorp Credit Management BDC, Inc. – Signature Page to Class A-R
Confirmation

--------------------------------------------------------------------------------

Confirmed as of the date first above written:

 

INVESTCORP CREDIT MANAGEMENT BDC, INC.

 

By:

 

                          

Name:

 

Title:

 

UBS – Signature Page to Class A-R Confirmation