Exhibit 10.2

 

  SALE AND SERVICING AGREEMENT   Among   HERCULES FUNDING II LLC,   as Borrower
  And   HERCULES TECHNOLOGY GROWTH CAPITAL, INC.,   as Originator and Servicer  
And LYON FINANCIAL SERVICES, INC.,

d/b/a U.S. Bank Portfolio Services,

as Backup Servicer   And   WELLS FARGO FOOTHILL, LLC,   as Agent  

Dated as of August 25, 2008

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TABLE OF CONTENTS

Page

 

ARTICLE I

 

DEFINITIONS

1

Section 1.01

Definitions

1

Section 1.02

Other Definitional Provisions 16  

ARTICLE II

 

CONVEYANCE OF THE PURCHASED ASSETS; BORROWINGS UNDER LOAN AGREEMENT 16

Section 2.01

Conveyance of the Purchased Assets; Borrowings 16

Section 2.02

Ownership and Possession of Loan Files 17

Section 2.03

Books and Records; Intention of the Parties 18

Section 2.04

Delivery of Loan Files 18

Section 2.05

Acceptance by the Agent of the Loan Files; Certification by the Collateral
Custodian 18

Section 2.06

Conditions Precedent to Closing 20

Section 2.07

Conditions to Borrowings 20

Section 2.08

Conditions to Transfers of Loans 21  

ARTICLE III

 

REPRESENTATIONS AND WARRANTIES 22

Section 3.01

Representations and Warranties of the Borrower 22

Section 3.02

Representations and Warranties of the Originator 24

Section 3.03

Representations and Warranties Regarding the Loans 26

Section 3.04

Notice of Breach of Representations and Warranties 28

Section 3.05

Repurchase of Ineligible Loans 29  

ARTICLE IV

 

ADMINISTRATION AND SERVICING OF LOANS 30

Section 4.01

Appointment of the Servicer 30

Section 4.02

Duties and Responsibilities of the Servicer 30

Section 4.03

Authorization of the Servicer 32

Section 4.04

Collection of Payments 33

Section 4.05

[Intentionally Omitted] 34

Section 4.06

Realization Upon Defaulted Loans or Charged-Off Loans 34

Section 4.07

Maintenance of Insurance Policies 34

Section 4.08

Representations and Warranties of the Servicer 34

Section 4.09

Covenants of the Servicer 36

Section 4.10

The Collateral Custodian; The Agent 38

Section 4.11

[Intentionally Omitted] 40

Section 4.12

[Intentionally Omitted] 40

Section 4.13

The Backup Servicer 40

Section 4.14

Representations and Warranties of the Backup Servicer 43

Section 4.15

Covenants of the Backup Servicer 44

Section 4.16

Payment of Certain Expenses by the Servicer and the Borrower 44

Section 4.17

Reports 44

Section 4.18

Annual Statement as to Compliance 45

Section 4.19

[Intentionally Omitted] 45

Section 4.20

Limitation on Liability 45

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TABLE OF CONTENTS

(continued)

Page

 

Section 4.21

The Servicer and the Backup Servicer Not to Resign 46

Section 4.22

Access to Certain Documentation and Information Regarding the Transferred Loans
46

Section 4.23

Identification of Records 47  

ARTICLE V

 

ESTABLISHMENT OF CASH MANAGEMENT ACCOUNT 47

Section 5.01

Cash Management Account 47  

ARTICLE VI

 

[RESERVED] 47  

ARTICLE VII

 

COVENANTS 47

Section 7.01

Financial and Serviced Portfolio Covenants of Hercules 47

Section 7.02

Covenants Regarding Purchased Assets 48  

ARTICLE VIII

 

THE SERVICER AND THE COLLATERAL CUSTODIAN 49

Section 8.01

Indemnification; Third Party Claims 49

Section 8.02

Relationship of Servicer to the Borrower and the Agent 51

Section 8.03

Servicer May Be a Lender 51

Section 8.04

Indemnification of the Agent and other Persons Under the Loan Agreement 52  

ARTICLE IX

 

SERVICER DEFAULT 52

Section 9.01

Servicer Default 52

Section 9.02

Appointment of Successor 54

Section 9.03

Waiver of Defaults 57

Section 9.04

Accounting Upon Termination of Servicer 57  

ARTICLE X

 

TERMINATION 58

Section 10.01

Termination 58  

ARTICLE XI

 

MISCELLANEOUS PROVISIONS 58

Section 11.01

Amendment 58

Section 11.02

Duration of Agreement 58

Section 11.03

GOVERNING LAW; JURISDICTION 58

Section 11.04

Notices 59

Section 11.05

Severability of Provisions 60

Section 11.06

No Partnership 60

Section 11.07

Counterparts 60

Section 11.08

Successors and Assigns 60

Section 11.09

Headings 60

Section 11.10

Non-Petition Agreement 60

Section 11.11

Due Diligence 60

Section 11.12

No Reliance

61

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TABLE OF CONTENTS

(continued)

 

Page

 

Section 11.13

Conflicts 61

Section 11.14

No Agency 62

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EXHIBIT A   Form of Servicer Report EXHIBIT B Form of S&SA Assignment EXHIBIT C
Form of Loan Schedule EXHIBIT D-1 Form of Initial Collateral Certification
EXHIBIT D-2 Form of Final Collateral Certification EXHIBIT E Form of Assignment
of Mortgage EXHIBIT F Form of Request for Release of Documents and Receipt
EXHIBIT G Form of Servicer’s Certificate EXHIBIT H Credit and Collection Policy

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SALE AND SERVICING AGREEMENT

This Sale and Servicing Agreement is entered into as of August 25, 2008, among
Hercules Funding II LLC, a Delaware limited liability company, as Borrower (in
such capacity, the “Borrower”), Hercules Technology Growth Capital, Inc., a
Maryland corporation (“Hercules”), as Originator (in such capacity, the
“Originator”) and as Servicer (in such capacity, the “Servicer”), Wells Fargo
Foothill, LLC, a Delaware limited liability company, as Agent for Lenders under
the Loan Agreement (as hereinafter defined) (in such capacity, the “Agent”), and
Lyon Financial Services, Inc., a Minnesota corporation, doing business as U.S.
Bank Portfolio Services, as Backup Servicer (in such capacity, the “Backup
Servicer”).

W I T N E S S E T H:

In consideration of the mutual agreements herein contained, the parties hereto
hereby agree as follows for the benefit of each of them and for the benefit of
the Agent and Lenders:

ARTICLE I  

DEFINITIONS

Section 1.01.  Definitions.

Whenever used in this Agreement, the following words and phrases, unless the
context otherwise requires, shall have the meanings specified in this
Article.  Unless otherwise specified, all calculations of interest with respect
to the Notes described herein shall be made on the basis of a 360-day year and
the actual number of days elapsed in each Accrual Period.

“1940 Act”:  The Investment Company Act of 1940, as amended, and the rules and
regulations promulgated thereunder.

“Accepted Servicing Practices”: The servicing practices and collection
procedures of the Servicer that are in accordance with the applicable Obligor
Loan Documents and Applicable Law and which are consistent with the higher
standard of (i) customary servicing practices of prudent institutions which
service loans or other financial assets similar to the Transferred Loans for
their own account or for the account of others and (ii) the same care, skill,
prudence and diligence with which the Servicer services and administers loans or
other financial assets which are similar to the Transferred Loans serviced or
administered pursuant to this Agreement, for its own account or for the account
of others; provided that, with respect to the Backup Servicer acting as
Servicer, the servicing standard applicable to the Backup Servicer shall be the
same care, skill and diligence with which the Backup Servicer services and
administers loans for its own accounts or for the accounts of others.

“Accreted Interest”:  The accrued interest on a PIK Loan that is added to the
principal amount of such PIK Loan instead of being paid as it accrues.

“Advance Rate:  On any date a percentage equal to 50%.

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“Advances Outstanding:  As of any date of determination, the aggregate principal
amount of Borrowings outstanding on such date, after giving effect to all
repayments of Borrowings and makings of new Borrowings on such date.

“Affiliate”:  With respect to any specified Person, any other Person controlling
or controlled by or under common control with such specified Person. For the
purposes of this definition, “control” when used with respect to any specified
Person means the power to direct the management and policies of such Person,
directly or indirectly, whether through the ownership of voting securities, by
contract or otherwise, and the terms “controlling” and “controlled” have
meanings correlative to the foregoing; provided, that in the case of the
Servicer or any Subsidiary, “Affiliate” shall not include any Person that is a
Portfolio Investment.

“Agent”: Wells Fargo Foothill, LLC, a Delaware limited liability company, as
Agent for the Lenders under the Loan Agreement, or any successor Agent under the
Loan Agreement.

“Agent’s Account”:  Has the meaning set forth in the Loan Agreement.

“Aggregate Outstanding Loan Balance”:  As of any date of determination, the sum
of the Outstanding Loan Balances of all Eligible Loans included as part of the
Collateral on such date minus the Outstanding Loan Balance of all Charged-Off
Loans included as part of the Collateral (and specifically excluding all
Ineligible Loans) on such date.

“Aggregate Unpaids”:  At any time, an amount equal to the sum of all unpaid
Advances Outstanding, Interest Payment Amounts and Interest Carry-Forward
Amounts, and all other amounts owed to the Agent and the Lender Group, the
Servicer, the Backup Servicer, and the Originator hereunder and under the Loan
Agreement (including, without limitation, all amounts in respect of indemnities
hereunder or under the Loan Agreement, other amounts payable under Section 8.01,
Section 8.04, and amounts required to be paid by the Borrower or any other
Person under the Fee Letter or any other fee letter delivered in connection with
the transactions contemplated by this Agreement or the Loan Agreement, in each
case whether due or accrued.

“Agreement”:  This Sale and Servicing Agreement, as it may be amended and
supplemented from time to time.

“Applicable Law”:  For any Person or property of such Person, all existing and
future applicable laws, rules, regulations (including proposed, temporary and
final income tax regulations), statutes, treaties, codes ordinances, permits,
certificates, orders and licenses of and interpretations by any Governmental
Authority (including, without limitation, usury laws, predatory lending laws,
the Federal Truth in Lending Act, and Regulation Z and Regulation B of the
Federal Reserve Board), and applicable judgments, decrees, injunctions, writs,
orders, or line action of any court, arbitrator or other administrative,
judicial, or quasi-judicial tribunal or agency of competent jurisdiction.

“Assignment of Mortgage”:  As to each Loan secured by an interest in real
property, one or more collateral assignments, notices of transfer or equivalent
instruments, each in recordable form and sufficient under the laws of the
relevant jurisdiction to reflect the transfer as collateral of the related
mortgage, deed of trust, security deed, immovable hypothec, deed of hypothec or
similar security instrument and all other documents related to such Loan to the
Borrower and to grant a perfected Lien thereon by the Borrower in favor of the
Agent, on behalf of the Lender Group, each such Assignment of Mortgage to be
substantially in the form of Exhibit E hereto.

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“Availability”:  Has the meaning set forth in the Loan Agreement.

“Backup Servicer”:  Lyon Financial Services, Inc., a Minnesota corporation,
doing business as U.S. Bank Portfolio Services, as Backup Servicer under this
Agreement, or any successor backup servicer under this Agreement.

“Backup Servicer Expenses”:  The reasonable out-of-pocket expenses to be paid to
the Backup Servicer under and in accordance with the Backup Servicer Fee Letter.

“Backup Servicer Fee”:  The fee to be paid to the Backup Servicer under the
terms of the Backup Servicer Fee Letter.

“Backup Servicer Fee Letter”:  Means the fee letter, dated as of the date
hereof, among the Originator and the Backup Servicer.

“Bankruptcy Code”: Title 11 of the United States Code.

“Bankruptcy Event”:  With respect to a Person, shall be deemed to have occurred
if either:

       (a)  a case or other proceeding shall be commenced, without the
application or consent of such Person, in any court seeking the liquidation,
reorganization, debt arrangement, dissolution, winding up, or composition or
readjustment of debts of such Person, the appointment of a trustee, receiver,
custodian, liquidator, assignee, sequestrator or the like for such Person or for
all or substantially all of its assets, or any similar action with respect to
such Person under any law relating to bankruptcy, insolvency, reorganization,
winding up or composition or adjustment of debts, and such case or proceeding
shall continue undismissed or unstayed, and in effect, for a period of 60
consecutive days; or an order for relief in respect of such Person shall be
entered in an involuntary case or proceeding under any such law now or hereafter
in effect; or

       (b)  such Person shall commence a voluntary case or other proceeding
under any applicable bankruptcy, insolvency, reorganization, debt arrangement,
dissolution or other similar law now or hereafter in effect, or shall consent to
the appointment of or taking possession by a receiver, liquidator, assignee,
trustee, custodian, sequestrator (or other similar official) for such Person or
for any substantial part of its assets, or shall make any general assignment for
the benefit of creditors, or shall fail to, or admit in writing its inability
to, pay its debts generally as they become due, or, if a corporation or similar
entity, its board of directors shall vote to implement any of the foregoing.

“Bankruptcy Laws”:  The Bankruptcy Code and all other applicable liquidation,
conservatorship, bankruptcy, moratorium, rearrangement, receivership,
insolvency, reorganization, suspension of payments, composition or adjustment of
debts or similar debtor relief laws from time to time in effect affecting the
rights of creditors generally.

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“Bankruptcy Proceeding”:  Any case, action or proceeding before any Governmental
Authority relating to a Bankruptcy Event.

“Borrower”: Hercules Funding II LLC, a Delaware limited liability company.

“Borrowing”: Has the meaning set forth in Section 2.01(b) hereof.

“Borrowing Base”:  Has the meaning set forth in the Loan Agreement.

“Borrowing Base Certificate”: Has the meaning set forth in the Loan Agreement.

“Business Day”:  Any day other than (i) a Saturday or Sunday or (ii) a day on
which banking institutions in New York City, Palo Alto, California, Madison,
Minnesota, or Dallas, Texas, or in the city in which the Servicer’s servicing
operations are located, are authorized or obligated by law or executive order to
be closed.

“Cash Management Account”:  Has the meaning set forth in the Loan Agreement.

“Charged-Off Loan”:  Any Transferred Loan (i) that is 180 days or more past due
with respect to any interest or principal payment, (ii) as to which a Bankruptcy
Event has occurred with respect to the related Obligor, (iii) as to which the
related Obligor has suffered any Material Adverse Change, (iv) that is or should
be written off as uncollectible by the Servicer in accordance with the Credit
and Collection Policy, (v) that has been placed on non-accrual status by the
Servicer in accordance with the Credit and Collection Policy, (vi) all or any
portion of which has been converted into or exchanged for an Equity Security or
(vii) has been sold for less than its Outstanding Loan Balance upon foreclosure
or upon exercise of remedies, provided, that only the portion of the Transferred
Loan not recouped in such sale shall be deemed to be “charged-off” for purposes
of clause (vii).

“Closing Date”: August 25, 2008.

“Code”:  The Internal Revenue Code of 1986, as amended from time to time, and
the regulations promulgated by the United States Treasury thereunder.

“Collateral”: Has the meaning provided in the Loan Agreement.

“Collateral Custodian”: Means a Person acceptable to both Borrower and Agent
that is appointed pursuant to a Collateral Custodian Agreement acceptable to
such Person, Borrower and Agent to hold the original Obligor Loan Documents to
be delivered under this Agreement or the Loan Agreement for Agent’s benefit.  As
of the Closing Date, there is no Collateral Custodian, and the original Obligor
Loan Documents required to be delivered under this Agreement or the Loan
Agreement will be delivered directly to and held by Agent.  Borrower and Agent
shall notify Originator, Servicer and Backup Servicer of the appointment of any
Collateral Custodian.

“Collateral Custodian Agreement” means a written agreement pursuant to which
Borrower and Agent appoint a Collateral Custodian with respect to this Agreement
and the Loan Agreement and specify the duties and compensation of such
Collateral Custodian.

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“Collateral Custodian Fee”:  Means any fees payable to a Collateral Custodian in
accordance with its Collateral Custodian Agreement.

“Collection Period”:  With respect to any Payment Date, the period from and
including the day following the Record Date for the preceding Payment Date (or,
in the case of the initial Payment Date, from and including the Closing Date) to
and including the Record Date with respect to the current Payment Date.

“Collections”:  (a) All cash collections or other cash proceeds received by the
Borrower or by the Servicer or the Originator on behalf of the Borrower from any
source in payment of any amounts owed in respect of a Transferred Loan,
including, without limitation, Interest Collections, Principal Collections,
Insurance Proceeds, and all Recoveries, (b) all amounts received by the Borrower
in connection with the removal of a Transferred Loan from the Collateral
pursuant to Section 3.05 and (c) any other funds received by or on behalf of the
Borrower with respect to any Transferred Loan or Related Property, but
excluding, in the case of (a), (b) or (c), as applicable, amounts in respect of
any Retained Interest and Excluded Amounts.

“Commission”:  The Securities and Exchange Commission.

“Continued Errors”: Has the meaning set forth in Section 9.02(d) hereof.

“Credit and Collection Policy”:  Means, with respect to the initial Servicer,
the written credit and collection policies and procedures of the Originator and
Servicer in effect for any Loans to be transferred to Borrower as of the Closing
Date and attached hereto as Exhibit H, as such policies and procedures may be
amended or supplemented from time to time in compliance with Section 4.09(f) and
with respect to a Successor Servicer, the customary written credit and
collection policies and procedures of such Successor Servicer.

“Debt to Worth Ratio” means, with respect to any Person as of any date of
determination, a ratio of (a) the sum of (i) the outstanding amount of all
Indebtedness of such Person as of such date, minus (ii) the outstanding amount
of the Subordinated Debt of such Person as of such date, to (b) the sum of (i)
Tangible Net Worth of such Person as of such date, plus (ii) the outstanding
amount of the Subordinated Debt of such Person as of such date.

“Default”:  Any occurrence that is, or with notice or the lapse of time or both
would become, an Event of Default.

“Defaulted Loan”:  Has the meaning provided in the Loan Agreement.

“Delinquent Loan”:  Has the meaning provided in the Loan Agreement.

“Distribution Account”:  The account established and maintained pursuant to
Section 5.01(a)(2) hereof.

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“Dollars” or “$” refers to lawful money of the United States of America.

“Eligible Loan”: On any date of determination, any Transferred Loan which both
(a) complies with the representations and warranties set forth in Section 3.03
and (b) is an Eligible Note Receivable under the Loan Agreement.

“Eligible Note Receivable”: Has the meaning set forth in the Loan Agreement.

“Eligible Servicer”:  (x) Hercules or (y) any other Person to which the Agent
may consent in writing.

“Equity Security”:  Any equity security or other obligation or security that
does not entitle the holder thereof to receive periodic payments of interest and
one or more installments of principal.

“Errors”: Has the meaning set forth in Section 9.02(d) hereof.

“Event of Default”:  Either a Servicer Default or an “Event of Default” under
the Loan Agreement.

“Exchange Act”:  The Securities Exchange Act of 1934, as amended, and the rules
and regulations promulgated thereunder.

“Excluded Amounts”:  Any Collections received with respect to Loans which have
been removed from the Collateral pursuant to Section 3.05 to the extent such
Collections are attributable to a time after the effective date of the
applicable substitution, repurchase or release.

“Fair Market Value”:  With respect to a Transferred Loan included in the
Collateral if such Transferred Loan has been reduced in value on such date of
determination below the original principal amount (other than as a result of the
allocation of a portion of the original principal amount to warrants or other
equity entitlements), the fair market value of such Transferred Loan as required
by, and in accordance with, the 1940 Act and any orders of the Commission issued
to the Originator, to be determined by the Board of Directors of the Originator
and reviewed by its auditors and communicated to the Servicer.

“Fee Letter”:  Has the meaning provided in the Loan Agreement.

“Final Collateral Certification”:  The certification in the form of Exhibit D-2
hereto prepared by the Agent or, if a Collateral Custodian has been appointed,
the Collateral Custodian.

“GAAP”:  Generally Accepted Accounting Principles as in effect in the United
States.

“Governmental Authority”: With respect to any Person, any national, government,
state, province or other political division thereof, any central bank (or
similar monetary or regulatory authority) thereof, any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to any government, and any court or arbitrator having jurisdiction
over such Person.

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“Indemnified Parties”: Has the meaning set forth in Section 8.01(c) hereof.

“Independent”: When used with respect to any specified Person, such Person (i)
is in fact independent of the Originator, the Servicer, the Borrower or any of
their respective Affiliates, (ii) does not have any direct financial interest
in, or any material indirect financial interest in, the Originator, the
Servicer, the Borrower or any of their respective Affiliates and (iii) is not
connected with the Originator, the Borrower, the Servicer or any of their
respective Affiliates, as an officer, employee, promoter, underwriter, trustee,
partner, director or Person performing similar functions; provided, however,
that a Person shall not fail to be Independent of the Originator, the Borrower,
the Servicer or any of their respective Affiliates merely because such Person is
the beneficial owner of 1% or less of any class of securities issued by the
Originator, the Borrower, the Servicer or any of their respective Affiliates, as
the case may be.

“Ineligible Loan”:  Shall have the meaning given such term in Section
3.05(b)(i).

“Initial Collateral Certification”:  The certification in the form of Exhibit
D-1 hereto prepared by Agent or, if a Collateral Custodian has been appointed,
the Collateral Custodian.

“Insurance Policy”:  With respect to any Transferred Loan included in the
Collateral, an insurance policy covering physical damage to or loss to any
assets or Related Property of the Obligor securing such Transferred Loan.

“Insurance Proceeds”:  Any amounts payable or any payments made to the Borrower
or to the Servicer on its behalf under any Insurance Policy.

“Intangible Assets”:  With respect to any Person, that portion of the book value
of all of such Person’s assets that would be treated as intangibles under GAAP.

“Interest Collections”:  Any and all amounts received with respect to a
Transferred Loan from or on behalf of the related Obligor that are deposited
into the Cash Management Account, or received by the Borrower or by the Servicer
or Originator on behalf of the Borrower in respect of Transferred Loans, not
constituting Principal Collections, and, solely for the purposes of calculating
the Portfolio Yield, any and all amounts accrued in respect of any fees (but
only to the extent such fees are not part of the Retained Interest or were not
received during such Collection Period) owed by any Obligor in respect of any
Transferred Loan.

“Interest Coverage Ratio” means, with respect to any Person for any period, the
ratio of (i) Net Investment Income for such period, to (ii) total interest
expense (including unused line fees) to the extent paid or required to be paid
during such period, in each case determined for such Person.

“Lender”:  Has the meaning set forth in the Loan Agreement.

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“Lien”:  With respect to any asset, (a) any mortgage, lien, pledge, charge,
security interest, hypothecation, option or encumbrance of any kind in respect
of such asset or (b) the interest of a vendor or lessor under any conditional
sale agreement, financing lease or other title retention agreement relating to
such asset.

“Loan”: Any senior loan arising from the extension of credit to an Obligor in
the ordinary course of the Originator’s business including, without limitation,
all Revolving Loans and PIK Loans, and including monies due and owing and all
Interest Collections, Principal Collections and other amounts received from time
to time with respect to such loan or note receivable and all Proceeds thereof.

“Loan Agreement”:  The Loan and Security Agreement among the Agent, the Lenders,
and the Borrower, dated as of August 25, 2008, as it may be amended or
supplemented from time to time.

“Loan Documents”:  This Agreement, the Loan Agreement, each S&SA Assignment, the
Fee Letter, the Backup Servicer Fee Letter, any UCC financing statements filed
pursuant to the terms of this Agreement or the Loan Agreement, and any
additional document, letter, fee letter, certificate, opinion, agreement or
writing the execution of which is necessary or incidental to carrying out the
terms of the foregoing documents.

“Loan Checklist” means the list delivered to the Agent and, if a Collateral
Custodian has been appointed, the Collateral Custodian, pursuant to Section 2.04
that identifies the documents contained in the related Loan File.

“Loan File”:  With respect to any Loan, each of the Obligor Loan Documents
related thereto as reflected on the Loan Checklist accompanying such File..

“Loan Rate”:  For each Transferred Loan in a Collection Period, the current cash
pay interest rate for such Transferred Loan in such period, as specified in the
related Obligor Loan Documents.

“Loan Schedule”:  The schedule of Loans conveyed to the Borrower on each
Transfer Date and delivered to the Agent and Backup Servicer (and, if a
Collateral Custodian has been appointed, with a copy to the Collateral
Custodian) in connection with each Borrowing or as new Loans are contributed to
the Borrower, initially as set forth in Exhibit C hereto.

“Loan Tape”:  Has the meaning set forth in the Section 4.13(b)(ii).

“Lyon Financial”: Lyon Financial Services, Inc., a Minnesota company, d/b/a U.S.
Bank Portfolio Services.

“Material Adverse Change”:  With respect to any Person, any material adverse
change in the business, condition (financial or otherwise), operations,
performance, properties or prospects of such Person.

“Material Adverse Effect”:  With respect to any event or circumstance, means a
material adverse effect on, as applicable, (a) the business, condition
(financial or otherwise), operations, performance, properties or prospects of
the Servicer, the Borrower, the Backup Servicer or, if a Collateral Custodian
has been appointed, the Collateral Custodian, (b) the validity, enforceability
or collectibility of this Agreement, any other Loan Document or the Purchased
Assets, (c) the rights and remedies of the Agent or any member of the Lender
Group under this Agreement or any Loan Document or (d) the ability of any of the
Servicer, the Borrower, the Backup Servicer or, if a Collateral Custodian has
been appointed, the Collateral Custodian, to perform its obligations under this
Agreement or any other Loan Document, or (e) the status, existence, perfection,
priority, or enforceability of the interest of the Borrower in the Purchased
Assets or of the Agent on behalf of the Lender Group in the Collateral.

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“Maturity Date”:  Has the meaning set forth in the Loan Agreement.

“Obligations”:  Has the meaning set forth in the Loan Agreement.

“Obligor”:  With respect to any Loan, the Person or Persons obligated to make
payments pursuant to such Loan, including any guarantor thereof.

“Obligor Loan Documents”: With respect to any Loan, each related promissory note
and any related loan agreement, security agreement, mortgage, moveable or
immoveable hypothec, deed of hypothec, assignments, guarantees, note purchase
agreement, intercreditor and/or subordination agreement, and UCC financing
statements and continuation statements (including amendments or modifications
thereof) executed by the Obligor thereof or by another Person on the Obligor’s
behalf in respect of such Loan and each related promissory note, including,
without limitation, general or limited guaranties and, for each Loan secured by
real property an Assignment of Mortgage, and for each promissory note, an
assignment (which may be by allonge), in blank, signed by an officer of the
Originator.

“Officer’s Certificate”:  A certificate signed by a Responsible Officer of the
Person delivering such certificate, in each case as required by this Agreement.

“Opinion of Counsel”:  A written opinion of counsel who may be employed by the
Servicer, the Borrower, the Originator or any of their respective Affiliates, in
form and substance satisfactory to the Agent.

“Originator”: Hercules and its permitted successors and assigns.

“Originator Indemnified Party”: Has the meaning set forth in Section 8.01(c)
hereof.

“Outstanding Loan Balance”:  With respect to any Loan, as of any date of
determination, the lesser of (i) the Fair Market Value of such Loan and (ii) the
total remaining amounts of principal payable by the Obligor thereof, excluding
principal payments in respect of Accreted Interest.

“Payment Date”: The 15th day of each calendar month, or if any such day is not a
Business Day, the first Business Day following such day, commencing on September
15, 2005.

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“Permitted Liens”:  (a) With respect to the Transferred Loans, Liens in favor of
the Borrower created pursuant to this Agreement and Liens in favor of the Agent,
on behalf of the Lender Group, created pursuant to the Loan Agreement; and

(b) with respect to the Borrower’s interest in the Related Property, any of the
following as to which no enforcement, collection, execution, levy, foreclosure
or realization proceedings shall have been commenced:

(i) Liens for taxes, fees, assessments or other governmental charges or levies,
either not delinquent or being contested in good faith by appropriate
proceedings; provided, that such Liens do not have priority over any of the
Originator’s Liens and the related Obligor maintains adequate reserves therefor
in accordance with GAAP;

(ii) Liens securing claims or demands of materialmen, artisans, mechanics,
carriers, warehousemen, landlords and other like Persons arising in the ordinary
course of the related Obligor’s business and imposed without action of such
parties; provided, that the payment thereof is not yet required;

(iii) Liens arising from judgments, decrees or attachments in circumstances
which do not constitute an “event of default” under the related Obligor Loan
Documents;

(iv) the following deposits, to the extent made in the ordinary course of
business:  deposits under worker's compensation, unemployment insurance, social
security and other similar laws, or to secure the performance of bids, tenders
or contracts (other than for the repayment of borrowed money) or to secure
indemnity, performance or other similar bonds for the performance of bids,
tenders or contracts (other than for the repayment of borrowed money) or to
secure statutory obligations (other than liens arising under ERISA or
environmental liens) or surety or appeal bonds, or to secure indemnity,
performance or other similar bonds;

(v) purchase money liens on equipment (to the extent permitted under the related
Obligor Loan Documents) which has been acquired or held by the related Obligor
and such Liens are incurred for financing the acquisition of the equipment, if,
the Liens are confined to the equipment and proceeds of the equipment; and

(vi) Liens incurred in connection with the extension, renewal or refinancing of
the indebtedness secured by Liens of the type described in clauses (i) through
(iv) above; provided, that any extension, renewal or replacement Lien shall be
limited to the property encumbered by the existing Lien and the principal amount
of the indebtedness being extended, renewed or refinanced (as may have been
reduced by any payment thereon) does not increase.

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“Person”:  Any individual, corporation, partnership, joint venture, limited
liability company, association, joint-stock company, trust, national banking
association, unincorporated organization or government or any agency or
political subdivision thereof.

“PIK Loan”:  A Loan which provides for a portion of the interest that accrues
thereon to be added to the principal amount of such Loan for some period of time
prior to such Loan requiring the current cash payment of such interest on a
monthly or quarterly basis, which cash payment shall be treated as Interest
Collections at the time it is received.

“Portfolio Investment”:  Any investment made by the Originator in the ordinary
course of business in a Person that is accounted for under GAAP as a portfolio
investment of the Originator.

“Prepaid Loan”:  Any Transferred Loan (other than a Charged-Off Loan) that was
terminated or has been prepaid in full or in part prior to its scheduled
maturity date.

“Predecessor Servicer Work Product”: Has the meaning set forth in Section
9.02(d) hereof.

“Proceeding”:  Any suit in equity, action at law or other judicial or
administrative proceeding.

“Proceeds”:  With respect to any Collateral, whatever is receivable or received
when such Collateral is sold, collected, liquidated, foreclosed, exchanged, or
otherwise disposed of, whether such disposition is voluntary or involuntary, and
includes all rights to payment with respect to any Insurance Policy relating to
such Collateral.

“Purchased Assets”:  All right, title and interest, whether now owned or
hereafter received, acquired or arising, and wherever located, of the Originator
in and to the property described in clauses (i) through (ix) below and all
accounts, cash and currency, chattel paper, tangible chattel paper, electronic
chattel paper, copyrights, copyright licenses, other intellectual property
rights, equipment, fixtures, contract rights, general intangibles, instruments,
certificates of deposit, certificated securities, uncertificated securities,
financial assets, securities entitlements, commercial tort claims, deposit
accounts, inventory, investment property, letter-of-credit rights, software,
supporting obligations, accessions, and other property consisting of, arising
out of, or related to any of the following (in each case excluding the Retained
Interest and the Excluded Amounts):

(i)  the Transferred Loans, and all monies due or to become due in payment of
such Transferred Loans on and after the related Transfer Date, including but not
limited to all Collections and all obligations owed to the Originator in
connection with the Transferred Loans;

(ii)  any Related Property securing or purporting to secure the Transferred
Loans (to the extent the Originator has been granted a Lien thereon) including
the related security interest granted by the Obligor under the Transferred
Loans, all proceeds from any sale or other disposition of such Related Property;

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(iii)  all security interests, Liens, guaranties, warranties, letters of credit,
accounts, bank accounts, mortgages or other encumbrances and property subject
thereto from time to time purporting to secure payment of any Transferred Loan,
together with all UCC financing statements or similar filings relating thereto;

(iv)  all claims (including “claims” as defined in Bankruptcy Code § 101(5)),
suits, causes of action, and any other right of the Originator, whether known or
unknown, against the related Obligors, if any, or any of their respective
Affiliates, agents, representatives, contractors, advisors, or any other Person
that in any way is based upon, arises out of or is related to any of the
foregoing, including, to the extent permitted to be assigned under applicable
law, all claims (including contract claims, tort claims, malpractice claims, and
claims under any law governing the purchase and sale of, or indentures for,
securities), suits, causes of action, and any other right of the Originator
against any attorney, accountant, financial advisor, or other Person arising
under or in connection with the related Obligor Loan Documents;

(v)  all cash, securities, or other property, and all setoffs and recoupments,
received or effected by or for the account of the Originator under such
Transferred Loans (whether for principal, interest, fees, reimbursement
obligations, or otherwise) after the related Transfer Date, including all
distributions obtained by or through redemption, consummation of a plan of
reorganization, restructuring, liquidation, or otherwise of any related Obligor
or the related Obligor Loan Documents, and all cash, securities, interest,
dividends, and other property that may be exchanged for, or distributed or
collected with respect to, any of the foregoing;

(vi)  all Insurance Policies;

(vii)  the Obligor Loan Documents with respect to such Transferred Loans;

(viii)  all Warrant Assets with respect to Transferred Loans; and

(ix)  the proceeds of each of the foregoing.

“Record Date”:  With respect to each Payment Date, the 10th day of each calendar
month occurring during the calendar month of such Payment Date, or if any such
day is not a Business Day, the first Business Day following such day, commencing
September 10, 2008.

“Recoveries”:  With respect to any Defaulted Loan or Charged-Off Loan, proceeds
of the sale of any Related Property, proceeds of any related Insurance Policy,
and any other recoveries with respect to such Transferred Loan and Related
Property, and amounts representing late fees and penalties, net of Liquidation
Expenses and amounts, if any, received that are required to be refunded to the
Obligor on such Transferred Loan.

“Related Property”:  With respect to any Loan, any property or other assets of
the Obligor thereunder pledged or purported to be pledged as collateral or in
which a Lien has been granted or purported to be granted to secure the repayment
of such Loan and including, without limitation, intellectual property rights.

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“Released Amounts”:  With respect to any payment or Collection received with
respect to any Transferred Loan on any Business Day (whether such payment or
Collection is received by the Servicer, the Originator or the Borrower), an
amount equal to that portion of such payment or collection constituting Excluded
Amounts or Retained Interest.

“Replaced Loan”:  Defined in Section 3.05(a).

“Responsible Officer”:  When used with respect to:

(a)  the Collateral Custodian (if one has been appointed), any officer within
the Corporate Trust Office of such Person, including any Vice President,
Assistant Vice President, Secretary, Assistant Secretary or any other officer of
such Person customarily performing functions similar to those performed by any
of the above designated officers and also, with respect to a particular matter,
any other officer to whom such matter is referred because of such officer’s
knowledge of and familiarity with the particular subject;

(b)  the Agent, or any Affiliate of the Agent, any Vice President of such
Person; and

(c)  the Borrower, the Servicer, the Originator or any Affiliate of any of them,
the Controller, the President, any Vice President or the Treasurer of such
Person.

“Retained Interest”:  With respect to each Transferred Loan, any origination or
underwriting fee paid to the Originator in connection with the origination or
acquisition of such Transferred Loan under the associated Obligor Loan
Documents, which are being retained by the Originator.

“Retransfer Price”:  Defined in Section 3.05(b).

“Review Criteria”:  Defined in Section 2.05(b)(ii).

“Revolving Loan”:  Any Loan that is a line of credit or other similar extension
of credit by the Originator where the Originator’s commitment under such Loan is
not fully funded and/or the proceeds of such Loan may be repaid and reborrowed.

“S&SA Assignment”:  An assignment of Purchased Assets from the Originator to the
Borrower pursuant to this Agreement, in the form of Exhibit B hereto.

“Sales Price”: With respect to any Transferred Loan and all Related Property and
other Collateral constituting part of the Purchased Assets with respect to such
Transferred Loan, an amount determined by multiplying the Advance Rate times the
Outstanding Loan Balance of such Transferred Loan.

“Scheduled Payment”:  On any Record Date, with respect to any Transferred Loan,
each monthly or quarterly payment (whether principal, interest or principal and
interest) scheduled to be made by the related Obligor after such Record Date
under the terms of such Transferred Loan.

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“Securities Act”: The Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.

“Servicer”: Hercules, in its capacity as the servicer hereunder, or any
successor appointed as herein provided.

“Servicer Default”:  Has the meaning set forth in Section 9.01 hereof.

“Servicer Indemnified Party”: Has the meaning set forth in Section 8.01(a)
hereof.

“Servicer Report”: A report substantially in the form of Exhibit A hereto, to be
delivered as contemplated by Section 4.17(a).

“Servicing Fee”:  For each Payment Date, an amount equal to the sum of the
products, for each day during the related Collection Period, of (a) a fraction,
the numerator of which is the sum of (i) the Aggregate Outstanding Loan Balance
as of the first day of such Collection Period plus (ii) the Aggregate
Outstanding Loan Balance as of the last day of such Collection Period, and the
denominator of which is two, (b) the Servicing Fee Rate, and (c) a fraction, the
numerator of which is 1 and the denominator of which is 360.

“Servicing Fee Rate”:  A rate equal to 1.0% per annum.

“Servicing Records”:  All documents, books, records and other information
(including, without limitation, computer programs, tapes, disks, data processing
software and related property rights) prepared and maintained by the Servicer
with respect to the Loans, any item of Related Property and the related
Obligors, other than the Obligor Loan Documents.

“Servicing Officer”:  Any officer of the Servicer involved in, or responsible
for, the administration and servicing of the Loans whose name and specimen
signature appears on a list of servicing officers annexed to an Officer’s
Certificate furnished by the Servicer on the date hereof to the Borrower and the
Agent, on behalf of the Lender Group, as such list may from time to time be
amended.

“Solvent”:  As to any Person at any time, having a state of affairs such that
all of the following conditions are met: (a) the fair value of the property
owned by such Person is greater than the amount of such Person’s liabilities
(including disputed, contingent and unliquidated liabilities) as such value is
established and liabilities evaluated for purposes of Section 101(32) of the
Bankruptcy Code; (b) the present fair salable value of the property owned by
such Person in an orderly liquidation of such Person is not less than the amount
that will be required to pay the probable liability of such Person on its debts
as they become absolute and matured; (c) such Person is able to realize upon its
property and pay its debts and other liabilities (including disputed, contingent
and unliquidated liabilities) as they mature in the normal course of business;
(d) such Person does not intend to, and does not believe that it will, incur
debts or liabilities beyond such Person’s ability to pay as such debts and
liabilities mature; and (e) such Person is not engaged in business or a
transaction, and is not about to engage in a business or a transaction, for
which such Person’s property would constitute unreasonably small capital.

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“State”:  Any one of the states of the United States of America or the District
of Columbia.

“Subordinated Debt” means any unsecured Indebtedness specifically subordinated
to the prior payment in full in cash of the Obligations and which shall
otherwise be on terms and conditions reasonably satisfactory to Agent and
subject to a Subordination Agreement.

“Subordination Agreement” means a subordination agreement executed and delivered
by Borrower and each of the holders of Subordinated Debt and Agent, the form and
substance of which is satisfactory to Agent.

“Subsidiary”:  With respect to any Person, any corporation, partnership or other
entity of which at least a majority of the securities or other ownership
interests having by the terms thereof ordinary voting power to elect a majority
of the board of directors or other persons performing similar functions of such
corporation, partnership or other entity (irrespective of whether or not at the
time securities or other ownership interests of any other class or classes of
such corporation, partnership or other entity shall have or might have voting
power by reason of the happening of any contingency) is at the time directly or
indirectly owned or controlled by such Person or one or more Subsidiaries of
such Person or by such Person and one or more Subsidiaries of such Person.

“Successor Engagement Fee”:  The “One-Time Successor Engagement Fee,” as defined
in the Backup Servicer Fee Letter.

“Successor Servicer”:  Defined in Section 9.02(a).

“Tangible Net Worth”:  With respect to any Person, as of any date of
determination, determined on a consolidated basis and in accordance with GAAP,
the result of (a) such Person’s total members’ or shareholder’s equity, minus
(b) all Intangible Assets of such Person, minus (c) all of such Person’s prepaid
expenses, minus (d) all amounts due to such Person from Affiliates of such
Person.

“Termination Date”: The earliest of (i) the date designated as such by the Agent
in its sole discretion by written notice to the Servicer following the
occurrence of an Event of Default, (ii) the date upon which this Agreement
terminates pursuant to Section 10.01 or (iii) the date of the occurrence of a
Bankruptcy Event with respect to the Servicer or the Borrower.

“Third Party Claim”: Has the meaning set forth in Section 8.01(d) hereof.

“Transfer”: Has the meaning set forth in Section 2.08 hereof.

“Transfer Date”:  With respect to each Transferred Loan, the date specified as
the “Transfer Date” in the related S&SA Assignment, on and after which
Collections on such Transferred Loan shall be included as part of the
Collateral.

“Transferred Loans”:  Each Loan that is sold or contributed to the Borrower
hereunder; provided, that the term Transferred Loan shall not include any
Retained Interests.

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“Transition Costs”:  Has the meaning set forth in Section 9.02(a) hereof.

“UCC”:  The Uniform Commercial Code as in effect in the State of New York.

“UCC Assignment”:  A financing statement meeting the requirements of the UCC of
the relevant jurisdiction to reflect an assignment of a secured party’s interest
in collateral.

“UCC Financing Statement”:  A financing statement meeting the requirements of
the UCC of the relevant jurisdiction.

“Underlying Note”:  Each promissory note of an Obligor evidencing a Loan.

“Warrant Asset”:  Means any equity purchase warrants or similar rights
convertible into or exchangeable or exercisable for any equity interests
received by Hercules as an “equity kicker” from the Obligor in connection with
such Transferred Loan; provided that the term Warrant shall in no event include
the right of  Hercules to participate as an investor in future equity financings
by an Obligor.

Section 1.02.  Other Definitional Provisions.

       (a)  Any agreement, instrument or statute defined or referred to herein
or in any instrument or certificate delivered in connection herewith means such
agreement, instrument or statute as from time to time amended, modified or
supplemented and includes (in the case of agreements or instruments) references
to all attachments thereto and instruments incorporated therein; references to a
Person are also to its permitted successors and assigns.

       (b)  All terms defined in this Agreement shall have the defined meanings
when used in any certificate or other document made or delivered pursuant hereto
unless otherwise defined therein.

       (c)  As used in this Agreement and in any certificate or other document
made or delivered pursuant hereto or thereto, accounting terms not defined in
this Agreement or in any such certificate or other document, and accounting
terms partly defined in this Agreement or in any such certificate or other
document to the extent not defined, shall have the respective meanings given to
them under GAAP.  To the extent that the definitions of accounting terms in this
Agreement or in any such certificate or other document are inconsistent with the
meanings of such terms under GAAP, the definitions contained in this Agreement
or in any such certificate or other document shall control.

       (d)  The words “hereof,” “herein,” “hereunder” and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement; Article, Section, Schedule
and Exhibit references contained in this Agreement are references to Articles,
Sections, Schedules and Exhibits in or to this Agreement unless otherwise
specified; and the term “including” shall mean “including without limitation.”

       (e)  The definitions contained in this Agreement are applicable to the
singular as well as the plural forms of such terms and to the masculine as well
as to the feminine and neuter genders of such terms.

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ARTICLE II  

CONVEYANCE OF THE PURCHASED ASSETS;
BORROWINGS UNDER LOAN AGREEMENT

Section 2.01.  Conveyance of the Purchased Assets; Borrowings.

(a)  Conveyance of the Purchased Assets.  (i)  On each Transfer Date, in
consideration of the payment of the Sales Price therefor and subject to the
satisfaction of the conditions to each Transfer set forth in Section 2.08
hereof, the Originator hereby sells and assigns to the Borrower, without
recourse, but subject to the other terms and provisions of this Agreement, all
of the right, title and interest of the Originator in and to the Purchased
Assets identified in the applicable S&SA Assignment and the related Loan
Schedule, and all proceeds of the foregoing.  

          (ii)  On each Transfer Date, the Borrower hereby purchases, and
acknowledges the conveyance to it, of the Purchased Assets identified in the
applicable S&SA Assignment and the related Loan Schedule, receipt of which is
hereby acknowledged by the Borrower.  Concurrently with such delivery, as of the
applicable Transfer Date, the Borrower automatically grants a security interest
in the Purchased Assets identified in the applicable S&SA Assignment and the
related Loan Schedule (a copy of which has or will concurrently therewith be
delivered to the Agent) to the Agent pursuant to the Loan Agreement as security
for the Borrower’s Obligations under the Loan Agreement and the other Loan
Documents.

         (iii)  Notwithstanding anything to the contrary herein, in no event
shall the Borrower be required to purchase the Purchased Assets identified in
any S&SA Assignment and the related Loan Schedule on any Transfer Date if the
conditions precedent to the applicable Transfer set forth in Section 2.08 have
not been fulfilled.

          (iv)  The Servicer shall, at its own expense, within one Business Day
following each Transfer Date, indicate in its computer files that the Purchased
Assets identified in the applicable S&SA Assignment and the related Loan
Schedule have been sold to the Borrower pursuant to this Agreement.

           (v)  The parties hereto intend that the conveyances contemplated
hereby be sales from the Originator to the Borrower of the Purchased Assets
identified in each S&SA Assignment and related Loan Schedule.  In the event the
transactions with respect to the Purchased Assets set forth herein are deemed
not to be a sale, the Originator hereby grants to the Borrower a security
interest in all of the Originator’s right, title and interest in, to and under
such Purchased Assets, to secure all of the Originator’s obligations hereunder,
and this Agreement shall constitute a security agreement under Applicable Law.

       (b)  Borrowings.  (i) Pursuant to the Loan Agreement, the Borrower may,
at its sole option, from time to time request that the Agent or the Lenders make
advance of funds to the Borrower under the Loan Agreement (each, a
“Borrowing”).  Notwithstanding anything to the contrary herein, in no event
shall the Agent or Lenders be required to advance Borrowings if the conditions
precedent to the making of Borrowings set forth Section 2.07 hereof and in
Section 3.01, 3.02, and 3.03 of the Loan Agreement have not been fulfilled.

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Section 2.02.  Ownership and Possession of Loan Files.

With respect to each Loan, as of the related Transfer Date, the ownership of the
related Obligor Loan Documents shall be vested in the Borrower as part of the
Collateral to secure the Obligations, and a security interest in the related
Obligor Loan Documents shall be granted and pledged to the Agent pursuant to the
loan Agreement, and the Agent or, if a Collateral Custodian has been appointed,
the Collateral Custodian, shall take possession of the Loan Files as
contemplated in Section 2.04 hereof.

Section 2.03.  Books and Records; Intention of the Parties.

On or prior to the Closing Date, the Originator shall, at such party’s sole
expense, cause to be filed UCC Financing Statements naming the Borrower as
“secured party” and describing the Purchased Assets being sold by the Originator
to the Borrower with the office of the Secretary of State of the state in which
the Originator is “located” for purpose of the applicable UCC and in any other
jurisdictions as shall be necessary to perfect a security interest in the
Purchased Assets.

Section 2.04.  Delivery of Loan Files.

       (a)  The Originator shall, with respect to each Loan subject to a
Transfer, as of the related Transfer Date, (i) no later than 12:00 p.m. New York
City time on the related Transfer Date, deliver or cause to be delivered to the
Agent or, if a Collateral Custodian has been appointed, the Collateral
Custodian, as the designated agent of the Agent, by facsimile transmission or in
an electronic format mutually agreed to by the Originator and the Agent, the
Loan Schedule and a copy of each executed Underlying Note endorsed in blank and
(ii) within two Business Days after such Transfer Date, deliver (or caused to be
delivered) to the Agent or, if a Collateral Custodian has been appointed, the
Collateral Custodian, each original and duly executed Underlying Note and
Assignment of Mortgage (if any), in each case endorsed in blank, any security
agreement related to each such Loan, and all other Obligor Loan Documents for
each such Loan, including a Loan Checklist for such Loan being transferred (on
which List the Agent or, if a Collateral Custodian has been appointed, the
Collateral Custodian, shall rely).

       (b)  The Agent or, if a Collateral Custodian has been appointed, the
Collateral Custodian, shall take and maintain continuous physical possession of
the Loan Files delivered to it by the Originator and, in connection therewith,
shall act solely as Agent or, in the case of the Collateral Custodian, as the
agent for the Agent, on behalf of the Lender Group in accordance with the terms
hereof and not as agent for the Originator, the Servicer or any other party.

Section 2.05.  Acceptance by the Agent of the Loan Files; Certification by the
Collateral Custodian.

       (a)  Based on the Final Collateral Certification prepared by the Agent
or, if a Collateral Custodian has been appointed, the Final Collateral
Certification received by the Agent from the Collateral Custodian and as of the
date of delivery thereof, the Agent will acknowledge receipt of the Loan Files
delivered to the Agent or, if a Collateral Custodian has been appointed, the
Collateral Custodian on behalf of the Agent, pursuant to Section 2.04 and
declares that it holds and will continue to hold directly the Obligor Loan
Documents and any amendments, replacements or supplements thereto and all other
assets constituting the Collateral delivered to it for the use and benefit of
the Lender Group.

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       (b)  (i)          On or before 3:00 p.m. New York City time on the
related Transfer Date, the Agent will prepare and provide a copy to the Backup
Servicer, the Collateral Custodian (if one has been appointed) and the
Originator, or, if a Collateral Custodian has been appointed, the Collateral
Custodian will deliver to the Agent, with a copy to the Backup Servicer, the
Collateral Custodian and the Originator, an Initial Collateral Certification,
confirming whether or not it has received a copy of each executed Underlying
Note endorsed in blank, for each Loan identified on the Loan Schedule to the
S&SA Assignment with respect to such Transfer Date.

          (ii)  Within five Business Days after its receipt of the remaining
Obligor Loan Documents for each such Transferred Loan, the Agent or, if a
Collateral Custodian has been appointed, the Collateral Custodian, shall review
the related Obligor Loan Documents to confirm that: (A) each related Underlying
Note has been properly executed and has no missing or mutilated pages, (B) UCC
Financing Statements and other filings required by the related Obligor Loan
Documents have been made, (C) other than in the case of a Transferred Loan
secured by receivables only (as identified on the Loan Checklist), an Insurance
Policy is contained in such Obligor Loan Documents with respect to any real or
personal property constituting the Related Property for such Transferred Loan,
(D) the related Outstanding Loan Balance, and Obligor name with respect to such
Transferred Loan is accurately reflected on the related Loan Schedule and (E)
based on the Obligor Loan Documents received, such Transferred Loan is not
already included in the Collateral (collectively, the “Review Criteria”).  Upon
completion of such review, the Agent will prepare and provide a copy to the
Backup Servicer, the Collateral Custodian and the Originator or, if a Collateral
Custodian has been appointed, the Collateral Custodian will deliver a Final
Collateral Certification to the Agent, with a copy to the Backup Servicer, the
Collateral Custodian and the Originator, confirming its receipt of the Obligor
Loan Documents.  Such certification will also contain an exception report
attached as Attachment A thereto which will identify any Transferred Loans for
which (i) the Agent or, if a Collateral Custodian has been appointed, the
Collateral Custodian, has not received a Obligor Loan Document or (ii) any
Review Criteria is not satisfied.

         (iii)  The Originator shall have five Business Days to deliver any
missing Obligor Loan Documents or correct any non-compliance with any Review
Criteria.  If after the conclusion of such time period the Originator has not
delivered such missing Obligor Loan Document or cured any non-compliance by a
Transferred Loan with any Review Criteria and such failure has a material
adverse effect on the value or enforceability of any Transferred Loan or the
interests of the Lender Group in any Transferred Loan, such Transferred Loan
shall be deemed to be an Ineligible Loan and the Originator shall repurchase
such Transferred Loan pursuant to Section 3.05(b) within one Business Day after
notice thereof at the Retransfer Price thereof by depositing such Retransfer
Price directly in the Agent’s Account or the Cash Management Account; provided
that the Originator shall not be required to pay the Retransfer Price with
respect to any such Transferred Loan to the extent that, after giving effect to
the removal of such Loan from the Collateral, the Availability shall exceed
$0.  On or prior to the date of such repurchase, the Originator shall deliver to
the Agent, with a copy to the Backup Servicer and the Collateral Custodian (if
one has been appointed), a certification of a Responsible Officer indicating
that the Originator intends to repurchase such Transferred Loan.

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          (iv)  It is understood and agreed that the obligation of the
Originator to repurchase any such Transferred Loan pursuant to this Section
2.05(b) and Section 3.05 shall constitute the sole remedy with respect to such
failure to comply with the foregoing delivery requirements.

       (c)  In performing its reviews of the Obligor Loan Documents, neither the
Agent nor, if a Collateral Custodian has been appointed, the Collateral
Custodian, shall have any responsibility to determine the genuineness of any
document contained therein and any signature thereon.  Neither the Agent nor, if
a Collateral Custodian has been appointed, the Collateral Custodian, shall have
any responsibility for determining whether any document is valid and binding,
whether the text of any assignment or endorsement is in proper or recordable
form, whether any document has been recorded in accordance with the requirements
of any applicable jurisdiction or whether a blanket assignment is permitted in
any applicable jurisdiction.

Section 2.06.  Conditions Precedent to Closing.  The effectiveness of this
Agreement shall be subject to the satisfaction of the following conditions
precedent as of the Closing Date:

       (a)  all conditions precedent to closing under Section 3.01 of the Loan
Agreement shall have been fulfilled;

       (b)  the Originator shall have delivered to the Agent evidence of a UCC-1
filing filed with the Maryland Department of Assessments and Taxation naming
Originator as seller and Borrower as buyer, to evidence the transfer of the
Transferred Loans and other Purchased Assets pursuant to this Agreement, in form
and substance reasonably satisfactory to the Agent; and

       (c)  the Originator shall have taken any action reasonably requested by
the Agent or the Borrower required to maintain or evidence the ownership
interest of the Borrower in the Purchased Assets and the security interest of
the Agent in the Collateral.

Section 2.07.  Conditions to Borrowings.  On the Closing Date and on any
Business Day prior to the Maturity Date, the Borrower may request a Borrowing
from the Lender Group in accordance with the Loan Agreement.  Any Borrowing
(including any Borrowing made on the Closing Date) shall be subject to the
following conditions:

       (a)  the Servicer shall have delivered to the Agent (with a copy to the
Collateral Custodian, if one has been appointed, and to the Backup Servicer) on
behalf of the Borrower a Borrowing Base Certificate;

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       (b)  all applicable conditions precedent to the Lender Group’s advance of
the Borrowing under Sections 3.01, 3.02, and 3.03 of the Loan Agreement shall
have been fulfilled as of such Borrowing Date.

       (c)  as of such date, neither the Originator nor the Borrower shall have
reason to believe that its insolvency is imminent;

       (d)  on and as of such date, after giving effect to such Borrowing, the
Availability shall exceed zero;

       (e)  the Originator shall have taken any action reasonably requested by
the Agent or the Borrower required to maintain or evidence the ownership
interest of the Borrower in the Purchased Assets and the security interest of
the Agent in the Collateral.;

       (f)  the Originator shall have deposited, or caused to be deposited, in
the Cash Management Account all Collections received with respect to each of the
Loans Transferred on and after its applicable Transfer Date;

       (g)  each of the representations and warranties made by the Originator
contained in Section 3.03 with respect to the Loans on the Closing Date shall be
true and correct as of the applicable Borrowing Date (in the case of a Borrowing
other than on the Closing Date, with the same effect as if then made) and each
of the Borrower and the Originator shall have performed all obligations to be
performed by it under the Loan Documents on or prior to such Borrowing Date; and

       (h)  it shall be a condition to the initial Borrowing that the Servicer
shall have delivered the form of Servicer Report, to be attached hereto as
Exhibit A, to the Backup Servicer and the Agent.

Section 2.08.  Conditions to Transfers of Loans.  On the Closing Date and on any
Business Day prior to the Maturity Date, the Originator may convey Loans to the
Borrower (each such conveyance, a “Transfer”).  Any Transfer (including any
Transfer made on the Closing Date) shall be subject to the following
conditions:  

       (a)  At least two Business Days prior to the proposed Transfer Date, the
Servicer shall give notice to the Agent (with a copy to the Collateral
Custodian, if one has been appointed, and to the Backup Servicer) of such
proposed Transfer Date and provide an estimate of the number of Loans and
aggregate Outstanding Loan Balance of such Loans proposed to be conveyed to the
Borrower on such Transfer Date.

       (b)  On the Business Day prior to the proposed Transfer Date, the
Borrower shall deliver to the Agent (with a copy to the Collateral Custodian, if
one has been appointed, and to the Backup Servicer) a final Loan Schedule
setting forth the Loans proposed to be transferred on such Transfer Date.

       (c)  On the applicable Transfer Date, the Borrower shall deliver to the
Agent (with a copy to the Collateral Custodian, if one has been appointed, and
to the Backup Servicer) a fully-executed S&SA Assignment and a final Loan
Schedule setting forth the Loans Transferred on such Transfer Date.

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       (d)  If the Borrower will consummate a Borrowing on such Transfer Date in
connection with the applicable Transfer, the conditions precedent to such
Borrowing set forth in Section 2.07 hereof and Sections 3.01, 3.02, and 3.03 of
the Loan Agreement shall be satisfied.

       (e)  As of the applicable Transfer Date, neither the Originator nor the
Borrower shall have reason to believe that its insolvency is imminent.

       (f)  The Originator shall have taken any action reasonably requested by
the Agent or the Borrower required to maintain or evidence the ownership
interest of the Borrower in the Purchased Assets and the security interest of
the Agent in the Collateral.

       (g)  Each of the representations and warranties made by the Originator
contained in Section 3.03 with respect to the Loans made on the Closing Date
shall be true and correct as of the applicable Transfer Date, with the same
effect as if then made, and each of the Borrower and the Originator shall have
performed all obligations to be performed by it under the Loan Documents on or
prior to such Transfer Date; provided that, if any representation or warranty
made by the Originator pursuant to Section 3.03 shall be incorrect as of any
Transfer Date with respect to any Loan to be purchased on such date, the
Borrower shall only be relieved of its obligation to purchase such Loan affected
by such breach and, assuming satisfaction or waiver of the other conditions set
forth in this clause (g), the Borrower shall nonetheless be obligated to
purchase all Loans to be purchased on such date that are unaffected by such
breach.

ARTICLE III  

REPRESENTATIONS AND WARRANTIES

Section 3.01.  Representations and Warranties of the Borrower.

The Borrower hereby represents, warrants and covenants to the other parties
hereto and the Lenders that as of each Transfer Date:

       (a)  The Borrower is a limited liability company duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
organization and has, and had at all relevant times, full power to own its
property, to carry on its business as currently conducted and to enter into and
perform its obligations under each Loan Document to which it is a party;

       (b)  The execution and delivery by the Borrower of each Loan Document to
which the Borrower is a party and its performance of and compliance with all of
the terms thereof will not violate the Borrower’s organizational documents or
constitute a default (or an event which, with notice or lapse of time, or both,
would constitute a default) under, or result in the breach or acceleration of,
any material contract, agreement or other instrument to which the Borrower is a
party or which are applicable to the Borrower or any of its assets;

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       (c)  The Borrower has the full power and authority to enter into and
consummate the transactions contemplated by each Loan Document to which the
Borrower is a party, has duly authorized the execution, delivery and performance
of each Loan Document to which it is a party and has duly executed and delivered
each Loan Document to which it is a party; each Loan Document to which it is a
party, assuming due authorization, execution and delivery by the other party or
parties thereto, constitutes a valid, legal and binding obligation of the
Borrower, enforceable against it in accordance with the terms thereof, except as
such enforcement may be limited by bankruptcy, insolvency, reorganization,
receivership, moratorium or other similar laws relating to or affecting the
rights of creditors generally, and by general equity principles (regardless of
whether such enforcement is considered in a proceeding in equity or at law);

       (d)  The Borrower is not in violation of, and the execution and delivery
by the Borrower of each Loan Document to which the Borrower is a party and its
performance and compliance with the terms of each Loan Document to which the
Borrower is a party will not constitute a violation with respect to any order or
decree of any court or any order or regulation of any federal, state, municipal
or governmental agency having jurisdiction over it or its business, which
violation would materially and adversely affect the financial condition or
operations of the Borrower or any of its properties or materially and adversely
affect the performance of any of its duties hereunder;

       (e)  There are no actions or proceedings against, or investigations of,
the Borrower currently pending with regard to which the Borrower has received
service of process, and no action or proceeding against, or investigation of,
the Borrower is, to the knowledge of the Borrower, threatened or otherwise
pending before any court, administrative agency or other tribunal that (A) would
prohibit its entering into any of the Loan Documents to which it is a party or
render its obligations thereunder invalid, (B) seeks to prevent the consummation
of any of the transactions contemplated by any of the Loan Documents to which it
is a party or (C) would prohibit or materially and adversely affect the
performance by the Borrower of its obligations under, or the validity or
enforceability of, any of the Loan Documents to which it is a party;

       (f)  No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by the Borrower of, or compliance by the Borrower with, any of the
Loan Documents to which the Borrower is a party, or for the consummation of the
transactions contemplated by any of the Loan Documents to which the Borrower is
a party, except for such consents, approvals, authorizations and orders, if any,
that have been obtained prior to such date;

       (g)  The Borrower is solvent, is able to pay its debts as they become due
and has capital sufficient to carry on its business and its obligations
hereunder; it will not be rendered insolvent by the execution and delivery of
any of the Loan Documents to which it is a party or the assumption of any of its
obligations thereunder; no petition of bankruptcy (or similar Bankruptcy
Proceeding) has been filed by or against the Borrower;

       (h)  The Borrower will be the sole owner of, each item in the Purchased
Assets transferred by the Originator, free and clear of any Lien other than
Permitted Liens, and, subject to the Loan Agreement, the Agent will have a first
priority perfected security interest in each item of Collateral, in each case
free and clear of any Lien other than Permitted Liens;

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       (i)  The Borrower acquired title to the Purchased Assets in good faith,
without notice of any adverse claim;

       (j)  None of the Loan Documents to which the Borrower is a party, nor any
Officer’s Certificate, statement, report or other document prepared by the
Borrower and furnished or to be furnished by it pursuant to any of the Loan
Documents to which it is a party or in connection with the transactions
contemplated thereby contains any untrue statement of material fact or omits to
state a material fact necessary to make the statements contained herein or
therein not misleading;

       (k)  The Borrower is not required to be registered as an “investment
company,” under the 1940 Act;

       (l)  The Borrower’s principal place of business and chief executive
offices are located at 400 Hamilton Avenue, Suite 310, Palo Alto, California
94301, or at such other address as shall be designated by such party in a
written notice to the other parties hereto; and

       (m)  The Borrower covenants that during the continuance of this Agreement
it will comply in all respects with the provisions of its organizational
documents in effect from time to time.

Section 3.02.  Representations and Warranties of the Originator.

The Originator hereby represents and warrants to the other parties hereto and
the Lenders that as of the Closing Date and as of each Transfer Date:

       (a)  The Originator is a corporation duly organized, validly existing and
in good standing under the laws of the jurisdiction of its organization, is duly
qualified, in good standing and licensed to carry on its business in each state
where the conduct of its business requires it to be so qualified and licensed
and has full corporate power and authority to own its property, to carry on its
business as currently conducted and to enter into and perform its obligations
under each Loan Document to which it is a party;

       (b)  The execution and delivery by the Originator of each Loan Document
to which it is a party and its performance of and compliance with the terms
thereof will not violate the Originator’s organizational documents or constitute
a default (or an event which, with notice or lapse of time, or both, would
constitute a default) under, or result in the breach or acceleration of, any
material contract, agreement or other instrument to which the Originator is a
party or which may be applicable to the Originator or any of its assets in each
case that is likely to affect materially and adversely its ability to carry out
the transactions contemplated hereby;

       (c)  The Originator has the full power and authority to enter into and
consummate all transactions contemplated by the Loan Documents to be consummated
by it, has duly authorized the execution, delivery and performance of each Loan
Document to which it is a party and has duly executed and delivered each Loan
Document to which it is a party; each Loan Document to which it is a party,
assuming due authorization, execution and delivery by each of the other parties
thereto, constitutes a valid, legal and binding obligation of the Originator,
enforceable against it in accordance with the terms hereof, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization,
receivership, moratorium or other similar laws relating to or affecting the
rights of creditors generally, and by general equity principles (regardless of
whether such enforcement is considered in a proceeding in equity or at law);

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       (d)  The Originator is not in violation of, and the execution and
delivery of each Loan Document to which it is a party by the Originator and its
performance and compliance with the terms of each Loan Document to which it is a
party will not constitute a violation with respect to, any order or decree of
any court or any order or regulation of any federal, state, municipal or
governmental agency having jurisdiction over it or its business, which violation
would materially and adversely affect the financial condition, business or
operations of the Originator or its properties or materially and adversely
affect the performance of its duties under any Loan Document to which it is a
party;

       (e)  There are no actions or proceedings against, or investigations of,
the Originator currently pending with regard to which the Originator has
received service of process, and no action or proceeding against, or
investigation of, the Originator is, to the Originator’s knowledge, threatened
or otherwise pending before any court, administrative agency or other tribunal
that (A) would prohibit its entering into any Loan Document to which it is a
party or render its obligations thereunder invalid, (B) seeks to prevent the
consummation of any of the transactions contemplated by any Loan Document to
which it is a party or (C) would prohibit or materially and adversely affect the
sale and contribution of the Purchased Assets to the Borrower, the performance
by the Originator of its obligations under, or the validity or enforceability
of, any Loan Document to which it is a party;

       (f)  No consent, approval, authorization or order of any court or
governmental agency or body is required for:  (1) the execution, delivery and
performance by the Originator of, or compliance by the Originator with, any Loan
Document to which it is a party, (2) the sale and contribution of the Purchased
Assets to the Borrower, or (3) the consummation of the transactions required of
it by any Loan Document to which it is a party, except such as shall have been
obtained before such date, other than:  (A) the filing or recording of financing
statements, instruments of assignment and other similar documents necessary in
connection with the sale of the Purchased Assets to the Borrower, (B) such
consents, approvals, authorizations, qualifications, registrations, filings or
notices as have been obtained or made and (C) where the lack of such consent,
approval, authorization, qualification, registration, filing or notice is
unlikely to have a material adverse effect on its performance hereunder;

       (g)  Immediately prior to the sale of the Purchased Assets to the
Borrower, the Originator had good and valid title to the Purchased Assets sold
by it on such date free and clear of all Liens other than Permitted Liens;

       (h)  The Originator is solvent, is able to pay its debts as they become
due and has capital sufficient to carry on its business and its obligations
under each Loan Document to which it is a party; it will not be rendered
insolvent by the execution and delivery of this Agreement or by the performance
of its obligations under each Loan Document to which it is a party; no petition
of bankruptcy (or similar Bankruptcy Proceeding) has been filed by or against
the Originator prior to the date hereof;

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       (i)  The Originator has transferred the Purchased Assets transferred by
it on each Transfer Date without any intent to hinder, delay or defraud any of
its creditors;

       (j)  The Originator has received fair consideration and reasonably
equivalent value in exchange for the Purchased Assets sold and contributed by it
on each Transfer Date to the Borrower;

       (k)  The Originator has not dealt with any broker or agent or other
Person who might be entitled to a fee, commission or compensation in connection
with the transaction contemplated by this Agreement;

       (l)  The Originator’s principal place of business and chief executive
offices are located at 400 Hamilton Avenue, Suite 310, Palo Alto, California
94301 or at such other address as shall be designated by such party in a written
notice to the other parties hereto;

       (m)  The Originator and the Servicer acknowledge and agree that the
Servicing Fee represents reasonable compensation for the performance of the
servicing duties hereunder and that the entire Servicing Fee shall be treated by
the Servicer and the Originator, for accounting purposes, as compensation for
the servicing and administration of the Transferred Loans pursuant to this
Agreement; and

       (n)  The Originator is in compliance with the financial covenants set
forth in Section 7.01.

It is understood and agreed that the representations and warranties set forth in
this Section 3.02 shall survive delivery of the respective Loan Files to Agent
or, if a Collateral Custodian has been appointed, the Collateral Custodian as
the agent of the Agent, and shall inure to the benefit of the Agent, the
Lenders, the Servicer, and the Borrower.  Upon discovery by the Originator, the
Servicer, the Borrower, or the Agent of a breach of any of the foregoing
representations and warranties that materially and adversely affects the value
of any item of Collateral or the interests of the Lender Group in any item of
Collateral, the party discovering such breach shall give prompt written notice
to the other parties.  The fact that Agent or any Lender has conducted or has
failed to conduct any partial or complete due diligence investigation of the
Loan Files shall not affect any rights of the Lender Group under this Agreement.

Section 3.03.  Representations and Warranties Regarding the Loans.

The Originator hereby represents and warrants, to the Agent, for the benefit of
the Lender Group, that as of the Closing Date with respect to each Loan sold or
contributed to the Borrower on the Closing Date, if any, and as of each Transfer
Date with respect to each Loan sold or contributed to the Borrower on each
Transfer Date:

       (a)  the Loan is evidenced by a promissory note that has been duly
authorized and that, together with the related Obligor Loan Documents, is in
full force and effect and constitutes the legal, valid and binding obligation of
the Obligor of such Loan to pay the stated amount of the Loan and interest
thereon, and the related Obligor Loan Documents are enforceable against such
Obligor in accordance with their respective terms;

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       (b)  the Loan was originated in accordance with the terms of the Credit
and Collection Policy and arose in the ordinary course of the Originator’s
business from the lending of money to the related Obligor;

       (c)  the Loan is not a Defaulted Loan or a Charged-Off Loan, and no
payment or portion thereof is more than 30 days delinquent;

       (d)  the Obligor of such Loan has executed all appropriate documentation
required by the Originator, as required by, and in accordance with, the Credit
and Collection Policy;

       (e)  the Loan, together with the Obligor Loan Documents related thereto,
is a “general intangible,” an “instrument,” a “payment intangible,” an
“account,” or “chattel paper” within the meaning of the UCC of all jurisdictions
that govern the perfection of the security interest granted therein;

       (f)  all material consents, licenses, approvals or authorizations of, or
registrations or declarations with, any Governmental Authority required to be
obtained, effected or given in connection with the making of such Loan have been
duly obtained, effected or given and are in full force and effect;

       (g)  any applicable taxes in connection with the transfer of such Loan
have been paid and the Obligor has been given any assurances (including with
respect to the payment of transfer taxes and compliance with securities laws)
required by the Obligor Loan Documents in connection with the transfer of the
Loan;

       (h)  the Loan is denominated and payable only in Dollars in the United
States;

       (i)  the Loan bears some current cash interest, which is due and payable
monthly or quarterly;

       (j)  the Loan, together with the related Obligor Loan Documents, was
originated in accordance with, and does not contravene in any material respect
any Applicable Laws (including, without limitation, laws, rules and regulations
relating to usury, predatory lending, truth in lending, fair credit billing,
fair credit reporting, equal credit opportunity, fair debt collection practices
and privacy);

       (k)  the Loan, together with the related Obligor Loan Documents, is fully
assignable without consent of the applicable Obligor or any agent with respect
to the Loan (except for such consents which have been obtained prior to the
related Transfer Date), (and, if such Loan is secured by an interest in real
property, an Assignment of Mortgage, in a form reasonably approved by the Agent
and attached hereto as Exhibit E prior to the first Borrowing pursuant to which
a Loan secured by an interest in real property shall become part of the
Collateral, has been delivered to the Agent or, if a Collateral Custodian has
been appointed, the Collateral Custodian);

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       (l)  the Loan was documented and closed in accordance with the Credit and
Collection Policy, and there is only one current original of each promissory
note representing all or a portion of the Outstanding Loan Balance of any Loan
that is included in the Collateral, and each such note has been delivered to the
Agent or, if a Collateral Custodian has been appointed, the Collateral Custodian
on behalf of the Agent, duly endorsed as Collateral;

       (m)  the Loan and the Borrower’s interest in all related Collateral and
Related Property are free of any Liens, except for Permitted Liens, and all
filings and other actions required to perfect the security interest of the
Agent, on behalf of the Lender Group, in the Collateral have been made or taken;

       (n)  the Loan has an original term to maturity of no more than 60 months,
and is either fully amortizing in installments (which installments need not be
in identical amounts) over such term or the principal amount thereof is due in a
single installment at the end of such term;

       (o)  no right of rescission, set off, counterclaim, defense or other
material dispute has been asserted with respect to such Loan;

       (p)  any Related Property with respect to such Loan is insured to the
extent consistent with the Credit and Collection Policy;

       (q)  the Obligor Loan Documents with respect to such Loan are complete in
accordance with the Credit and Collection Policy;

       (r)  the Obligor with respect to such Loan is not a Person who would
cause such Loan to not be an Eligible Note Receivable under the Loan Agreement;

       (s)  such Loan does not contain any confidentiality provision which would
purport to restrict disclosure of data or other information related to such Loan
or the related Obligor if such disclosure is subject to confidentiality
restrictions that reasonably protect against the disclosure of such data or
other information;

       (t)  the Loan does not by its terms permit the payment obligation of the
Obligor thereunder to be converted into or exchanged for equity capital of such
Obligor;

       (u)  the Obligor of such Loan has waived all rights of set-off and/or
counterclaim against the Originator of the Loan and all assignees thereof; and

       (v)  all information on the Loan Schedule delivered to the Agent or, if a
Collateral Custodian has been appointed, the Collateral Custodian on behalf of
the Agent with respect to such Loan is true and correct.

It is understood and agreed that the representations and warranties set forth
herein shall survive delivery of the respective Loan Files to the Borrower
and/or the Agent or, if a Collateral Custodian has been appointed, the
Collateral Custodian, and shall inure to the benefit of the Borrower, Agent and
Lender Group, as applicable, and their successors and assigns, notwithstanding
any restrictive or qualified endorsement or assignment.

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Section 3.04.  Notice of Breach of Representations and Warranties.  It is
understood and agreed that the representations and warranties set forth in
Section 3.03 shall survive the conveyance of the Purchased Assets to the
Borrower and the grant by the Borrower of a security interest in the Collateral
to the Agent, as applicable.  Upon discovery by the Servicer, the Originator,
the Collateral Custodian (if one has been appointed), the Borrower, or the Agent
of a breach of any of such representations and warranties or the representations
and warranties of the Originator set forth in Section 3.02 or 3.03, which breach
materially and adversely affects the value or enforceability of all or any
portion of the Purchased Assets or the interests of the Lender Group in all or
any portion of the Collateral, any party discovering such breach shall give
prompt written notice to the others.  

Section 3.05.  Repurchase of Ineligible Loans.

       (a)  [Intentionally Omitted].

       (b)  Repurchase of Ineligible Loans.

           (i)  Subject to Section 3.05(b)(ii), in the event of a breach of (A)
any representation or warranty set forth in Section 3.03 with respect to a
Transferred Loan (or the Related Property and other related collateral
constituting part of the Purchased Assets related to such Transferred Loan)
(each such Transferred Loan, an “Ineligible Loan”), no later than 30 days after
the earlier of (x) knowledge of such breach on the part of the Originator or the
Servicer and (y) receipt by the Originator or the Servicer of written notice
thereof given by the Borrower or the Agent, or (B) the applicable Transferred
Loan is identified for repurchase pursuant to Section 2.05(b)(ii), the Borrower
shall repay Advances Outstanding in an amount equal to the aggregate Retransfer
Price of such Ineligible Loan(s) to which such breach relates on the terms and
conditions set forth below; provided, that no such repayment shall be required
to be made with respect to any Ineligible Loan (and such Transferred Loan shall
cease to be an Ineligible Loan) if, on or before the expiration of such 30 day
period, the representations and warranties in Section 3.03 with respect to such
Ineligible Loan shall be made true and correct in all material respects with
respect to such Ineligible Loan as if such Ineligible Loan had become part of
the Collateral on such day.  If the Borrower is required to repay Advances
Outstanding pursuant to this Section 3.05(b)(i), the Originator shall make a
contemporaneous deposit to the Cash Management Account of the related Retransfer
Price, as contemplated by Section 3.05(b)(iii).

          (ii)  Notwithstanding anything contained in this Section 3.05(b) to
the contrary, in the event that a Transferred Loan is determined to be an
Ineligible Loan by reason of a breach of any representation and warranty set
forth in Section 3.03 with respect to each Transferred Loan, the Related
Property and other related collateral constituting part of the Purchased Assets
related to such Transferred Loan having been (A) conveyed to the Borrower or
granted as Collateral to the Agent, on behalf of the Lenders, free and clear of
any Lien of any Person claiming through or under the Originator or its
Affiliates and (B) in compliance, in all material respects, with all Applicable
Law, immediately upon the earlier to occur of the discovery of such breach by
the Borrower or receipt by the Borrower of written notice of such breach given
by the Agent, the Originator shall make a contemporaneous deposit to the Cash
Management Account as contemplated by Section 3.05(b)(iii) to enable the
Borrower to repay, and the Borrower shall repay, Advances Outstanding in an
amount equal to the sum of (I) the aggregate Outstanding Loan Balance of such
Ineligible Loan(s), and (II) any accrued and unpaid interest thereon
(collectively, the “Retransfer Price”), and the Agent shall release to the
Borrower (for release to the Originator) any such Ineligible Loan(s) and
relinquish any Lien created thereon pursuant to the Loan Agreement or
otherwise.  On and after the date of payment of the Retransfer Price, the
applicable Ineligible Loan and the Related Property and other related collateral
constituting part of the Purchased Assets with respect to such Ineligible Loan
shall not be included in the Collateral.  

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         (iii)  In consideration of any such release by the Borrower (and by the
Agent on behalf of the Lenders), the Originator shall, on the date of such
repayment, deposit to the Cash Management Account, in immediately available
funds, an amount equal to the Retransfer Price therefor.  Upon each such
repayment, the Agent, on behalf of the Lenders, shall automatically and without
further action be deemed to release to the Borrower (which shall release to the
Originator) all the right, title and interest of the Agent on behalf of the
Lenders (and all right, title and interest of the Borrower) in, to and under
such Ineligible Loan(s) and all monies due or to become due with respect
thereto, all proceeds thereof and all rights to security for any such Ineligible
Loan, and all proceeds and products of the foregoing.  The Borrower and the
Agent shall, at the sole expense of the Borrower, execute such documents and
instruments of transfer as may be prepared by the Borrower and the Originator
(or the Servicer on their behalf) and take such other actions as shall
reasonably be requested by the Borrower to effect the transfer of such
Ineligible Loan pursuant to this Section 3.05.

          (iv)  The Borrower hereby agrees that if any real property collateral
securing any Transferred Loan becomes the subject of any claims, proceedings,
Liens or encumbrances with respect to any material violation or claimed material
violation of any Environmental Law, such Transferred Loan shall for all purposes
hereunder be deemed an Ineligible Loan at and following the time of discovery of
such fact by the Servicer, the Borrower, any Lender, the Agent, or the
Collateral Custodian (if one has been appointed), and the Originator shall
deposit to the Cash Management Account an amount equal to the Retransfer Price
of such Ineligible Loan.  Such Ineligible Loan shall otherwise be treated in
accordance with this Section 3.05.

ARTICLE IV  

ADMINISTRATION AND SERVICING OF LOANS

Section 4.01.  Appointment of the Servicer.

The Borrower hereby appoints Hercules Technology Growth Capital, Inc. as the
Servicer hereunder to service the Transferred Loans and enforce its respective
rights and interests in and under each Transferred Loan in accordance with the
terms and conditions of this Article IV and to serve in such capacity until the
termination of its responsibilities pursuant to Section 9.01.  Hercules
Technology Growth Capital, Inc. hereby accepts such appointment and agrees to
perform the duties and obligations with respect thereto set forth herein.  The
Servicer and the Borrower hereby acknowledge that the Agent and the Lender Group
are third party beneficiaries of the obligations undertaken by the Servicer
hereunder.

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Section 4.02.  Duties and Responsibilities of the Servicer.

       (a)  The Servicer shall conduct the servicing, administration and
collection of the Transferred Loans and shall take, or cause to be taken, all
such actions as may be necessary or advisable to service, administer and collect
Transferred Loans from time to time on behalf of the Borrower and as the
Borrower’s agent.  The Servicer will service, administer and make collections on
the Transferred Loans with reasonable care, using that degree of skill and
attention that the Servicer exercises with respect to all comparable loans that
it services for itself or others and in accordance with the Accepted Servicing
Practices.

       (b)  The duties of the Servicer, as the Borrower’s agent, shall include,
without limitation:

           (i)  preparing and submitting of claims to, and post-billing liaison
with, Obligors on Transferred Loans;

          (ii)  maintaining all necessary Servicing Records with respect to the
Transferred Loans and providing such reports to the Borrower, the Agent and the
Lender Group in respect of the servicing of the Transferred Loans (including
information relating to its performance under this Agreement) as may be required
hereunder, under the Loan Agreement, or as the Borrower or the Agent may
reasonably request;

         (iii)  maintaining and implementing administrative and operating
procedures (including, without limitation, an ability to re-create Servicing
Records evidencing the Transferred Loans in the event of the destruction of the
originals thereof) and keeping and maintaining all documents, books, records and
other information reasonably necessary or advisable for the collection of the
Transferred Loans (including, without limitation, records adequate to permit the
identification of each new Transferred Loan and all Collections of and
adjustments to each existing Transferred Loan); provided, that any successor
Servicer shall only be required to re-create the Servicing Records of each prior
Servicer to the extent such records have been delivered to it in a format
reasonably acceptable to such successor Servicer;

          (iv)  promptly delivering to the Borrower, the Agent, the Lender Group
and the Collateral Custodian (if one has been appointed), from time to time,
such information and Servicing Records (including information relating to its
performance under this Agreement) as the Borrower, the Agent, or the Collateral
Custodian (if one has been appointed) may from time to time reasonably request;

           (v)  identifying each Transferred Loan clearly and unambiguously in
its Servicing Records to reflect that such Transferred Loan is owned by the
Borrower and pledged to the Agent, for the benefit of the Lender Group;

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          (vi)  complying in all material respects with the Credit and
Collection Policy in regard to each Transferred Loan;

         (vii)  complying in all material respects with all Applicable Laws with
respect to it, its business and properties and all Transferred Loans and
Collections with respect thereto;

        (viii)  preserving and maintaining its existence, rights, licenses,
franchises and privileges as a corporation in the jurisdiction of its
organization, and qualifying and remaining qualified in good standing as a
foreign corporation and qualifying to and remaining authorized and licensed to
perform obligations as Servicer (including enforcement of collection of
Transferred Loans on behalf of the Borrower and the Agent,) in each jurisdiction
where the failure to preserve and maintain such existence, rights, franchises,
privileges and qualification would materially adversely affect (A) the rights or
interests of the Borrower, the Agent, and the Lender Group in the Transferred
Loans, (B) the collectibility of any Transferred Loan, or (C) the ability of the
Servicer to perform its obligations hereunder;

          (ix)  notifying the Borrower and the Agent of any material action,
suit, proceeding, dispute, offset deduction, defense or counterclaim that (1) is
or is threatened to be asserted by an Obligor with respect to any Transferred
Loan; or (2) would reasonably be expected to have a Material Adverse Effect; and

       (c)  The Borrower and Servicer hereby acknowledge that none of the Agent
or the Lender Group, nor the Collateral Custodian (if one has been appointed),
shall have any obligation or liability with respect to any Transferred Loans,
nor shall any of them be obligated to perform any of the obligations of the
Servicer hereunder.

Section 4.03.  Authorization of the Servicer.

       (a)  Each of the Borrower and the Agent, on behalf of the Lender Group,
hereby authorizes the Servicer (including any successor thereto) to take any and
all reasonable steps in its name and on its behalf necessary or desirable and
not inconsistent with the pledge of the Transferred Loans pursuant to the Loan
Agreement, in the determination of the Servicer, to collect all amounts due
under any and all Transferred Loans, including, without limitation, endorsing
any of their names on checks and other instruments representing Collections,
executing and delivering any and all instruments of satisfaction or
cancellation, or of partial or full release or discharge, and all other
comparable instruments, with respect to the Transferred Loans and, after the
delinquency of any Transferred Loan and to the extent permitted under and in
compliance with Applicable Law, to commence proceedings with respect to
enforcing payment thereof, to the same extent as the Originator could have done
if it had continued to own such Loan.  The Borrower shall furnish the Servicer
(and any successors thereto) with any powers of attorney and other documents
necessary or appropriate to enable the Servicer to carry out its servicing and
administrative duties hereunder, and shall cooperate with the Servicer to the
fullest extent in order to ensure the collectibility of the Transferred
Loans.  In no event shall the Servicer be entitled to make the Borrower, the
Collateral Custodian (if one has been appointed), the Agent or any member of the
Lender Group a party to any litigation without such party’s express prior
written consent, or to make the Borrower a party to any litigation (other than
any routine foreclosure or similar collection procedure) without the Agent’s
consent.

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       (b)  After an Event of Default has occurred and is continuing, at the
Agent’s direction, the Servicer shall take such action as the Agent may deem
necessary or advisable to enforce collection of the Transferred Loans; provided,
that the Agent may, at any time after an Event of Default has occurred and is
continuing, notify any Obligor with respect to any Transferred Loans of the
pledge of such Transferred Loans to the Agent and direct that payments of all
amounts due or to become due to the Borrower thereunder be made directly to the
Agent or any servicer, collection agent or lock-box or other account designated
by the Agent and, upon such notification and at the expense of the Borrower, the
Agent may enforce collection of any such Transferred Loans and adjust, settle or
compromise the amount or payment thereof.  The Agent shall give written notice
to any successor Servicer of the Agent’s actions or directions pursuant to this
Section 4.3(b).

Section 4.04.  Collection of Payments.

       (a)  Collection Efforts, Modification of Loans.  The Servicer will make
reasonable efforts to collect all payments called for under the terms and
provisions of the Transferred Loans as and when the same become due, and will
follow those collection procedures as are consistent with Accepted Servicing
Practices.  The Servicer may not waive, modify or otherwise vary any provision
of a Transferred Loan, except as may be in accordance with the Credit and
Collection Policy.  Notwithstanding anything to the contrary contained herein,
the Servicer will not take any action with respect to any Transferred Loans that
is prohibited under the Loan Agreement.

       (b)  Taxes and other Amounts.  To the extent provided for in any
Transferred Loan, the Servicer will use its best efforts to collect all payments
with respect to amounts due for taxes, assessments and insurance premiums
relating to such Transferred Loans or the Related Property and remit such
amounts to the appropriate Governmental Authority or insurer on or prior to the
date such payments are due.

       (c)  Payments to Cash Management Account.  On or before the Transfer Date
with respect to each Transferred Loan, the Servicer shall have instructed all
Obligors to make all payments in respect of all Transferred Loans included in
the Collateral directly to a Cash Management Account established pursuant to the
Loan Agreement.  Servicer shall also be responsible for compliance with the all
other requirements of the cash management provisions in Section 2.6 of the Loan
Agreement.

       (d)  Adjustments.  If (i) the Servicer makes a deposit into the Cash
Management Account in respect of a Collection of a Transferred Loan included in
the Collateral and such Collection was received by the Servicer in the form of a
check that is not honored for any reason or (ii) the Servicer makes a mistake
with respect to the amount of any Collection and deposits an amount that is less
than or more than the actual amount of such Collection, the Servicer shall
appropriately adjust the amount subsequently deposited into the Cash Management
Account to reflect such dishonored check or mistake.  Any Scheduled Payment in
respect of which a dishonored check is received shall be deemed not to have been
paid.

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       (e)  Released Amounts.  The Agent hereby agrees that it shall release to
the Borrower from the Collateral, and the Borrower hereby agrees to release to
the Originator, an amount equal to the Released Amounts promptly upon receipt of
an Officer’s Certificate of the initial Servicer (or the Originator if the
initial Servicer is no longer the Servicer) setting forth the calculation
thereof, which release shall be automatic and shall require no further act by
the Agent; provided, that, the Agent and the Borrower, as applicable, shall
execute and deliver such instruments of release and assignment, or otherwise
confirm the foregoing release, as may reasonably be requested by the Servicer on
behalf of the Borrower or the Originator, as applicable, in writing.  Upon such
release, such Released Amounts shall not constitute and shall not be included in
the Collateral.  Immediately upon the release to the Borrower by the Agent of
the Released Amounts, the Borrower hereby irrevocably agrees to release to the
Originator such Released Amounts, which release shall be automatic and shall
require no further act by the Borrower; provided, that the Borrower shall
execute and deliver such instruments of release and assignment, or otherwise
confirming the foregoing release of any Released Amounts, as may be reasonably
requested by the Originator.

Section 4.05.  [Intentionally Omitted].

Section 4.06.  Realization Upon Defaulted Loans or Charged-Off Loans.

The Servicer will use its reasonable efforts to repossess or otherwise
comparably convert the ownership of any Related Property with respect to a
Defaulted Loan or Charged-Off Loan and will act as sales and processing agent
for Related Property that it repossesses.  The Servicer will follow the
practices and procedures set forth in the Credit and Collection Policy in order
to realize upon such Related Property.  Without limiting the foregoing, the
Servicer may sell any such Related Property with respect to any Defaulted Loan
or Charged-Off Loan to the Servicer or its Affiliates for a purchase price equal
to the then fair market value thereof (including, if applicable, the fair market
value of any Warrant Assets included in such sale) ; any such sale to be
evidenced by a certificate of a Responsible Officer of the Servicer delivered to
the Agent identifying the Defaulted Loan or Charged-Off Loan and the Related
Property, setting forth the sale price of the Related Property and certifying
that such sale price is the fair market value of such Related Property;
provided, that if after giving effect to such sale (a) the Availability would
not be greater than or equal to zero or (b) a Default or an Event of Default
would exist, then the Servicer prior to selling any Related Property with
respect to a Defaulted Loan or Charged-Off Loan shall obtain the prior written
consent of the Agent.  In any case in which any such Related Property has
suffered damage, the Servicer will not expend funds in connection with any
repair or toward the repossession of such Related Property unless it reasonably
determines that such repair and/or repossession will increase the Recoveries by
an amount greater than the amount of such expenses.  The Servicer will remit to
the Cash Management Account the Recoveries received in connection with the sale
or disposition of Related Property with respect to a Defaulted Loan or
Charged-Off Loan.

Section 4.07.  Maintenance of Insurance Policies.

The Servicer will require that each Obligor with respect to a Transferred Loan
maintain an Insurance Policy with respect to each Transferred Loan and the
Related Property, to the extent consistent with the Credit and Collection
Policy.  In connection with its activities as Servicer, the Servicer agrees to
present, on behalf of the Borrower and the Agent, on behalf of the Lender Group,
with respect to the respective interests, claims to the insurer under each
Insurance Policy and any such liability policy, and to settle, adjust and
compromise such claims, in each case, consistent with the terms of each related
Transferred Loan.

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Section 4.08.  Representations and Warranties of the Servicer.

The Servicer hereby represents and warrants as follows:

       (a)  Organization and Good Standing; Power and Authority.  The Servicer
is a corporation duly organized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation with all requisite corporate power
and authority to own its properties and to conduct its business as presently
conducted and to enter into and perform its obligations pursuant to this
Agreement and each other Loan Document to which it is a party.

       (b)  Due Qualification.  The Servicer is qualified to do business as a
corporation, is in good standing, and has obtained all licenses and approvals as
required under the laws of all jurisdictions in which the ownership or lease of
its property and or the conduct of its business (other than the performance of
its obligations hereunder) requires such qualification, standing, license or
approval, except to the extent that the failure to so qualify, maintain such
standing or be so licensed or approved would not have an adverse effect on the
interests of the Borrower or of the Lender Group.  The initial Servicer is
qualified to do business as a corporation, is in good standing, and has obtained
all licenses and approvals as required under the laws of all states in which the
performance of its obligations pursuant to this Agreement requires such
qualification, standing, license or approval, except where the failure to
qualify or obtain such license or approval would not reasonably be expected to
have a Material Adverse Effect on its ability to perform hereunder.

       (c)  Due Authorization.  The Servicer has duly authorized the execution,
delivery and performance of this Agreement by all requisite corporate action.

       (d)  No Violation.  The consummation of the transactions contemplated by,
and the fulfillment of the terms of, this Agreement by the Servicer (with or
without notice or lapse of time) will not (i) conflict with, result in any
breach of any of the terms or provisions of, or constitute a default under, the
articles of incorporation or by-laws of the Servicer, or any material
contractual obligation to which the Servicer is a party or by which it or any of
its property is bound, (ii) result in the creation or imposition of any Lien
upon any of its properties pursuant to the terms of any such contractual
obligation (other than this Agreement), or (iii) violate in any material respect
any Applicable Law.

       (e)  No Consent.  No consent, approval, authorization, order,
registration, filing, qualification, license or permit of or with any
Governmental Authority having jurisdiction over the Servicer or any of its
properties is required to be obtained by or with respect to the Servicer in
order for the Servicer to enter into this Agreement or perform its obligations
hereunder.

       (f)  Binding Obligation.  This Agreement constitutes a legal, valid and
binding obligation of the Servicer, enforceable against the Servicer in
accordance with its terms, except as such enforceability may be limited by (i)
applicable Bankruptcy Laws and (ii) general principles of equity (whether
considered in a suit at law or in equity).

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       (g)  No Proceedings.  Except as previously disclosed to the Agent and
Lender Group in writing, there are no proceedings or investigations (formal or
informal) pending or threatened against the Servicer, before any Governmental
Authority (i) asserting the invalidity of this Agreement, (ii) seeking to
prevent the consummation of any of the transactions contemplated by this
Agreement or (iii) seeking any determination or ruling that would (in the
reasonable judgment of the Servicer) be expected to have a Material Adverse
Effect.

       (h)  Reports Accurate.  All Servicer Certificates, information, exhibits,
financial statements, documents, books, Servicing Records or reports furnished
or to be furnished by the Servicer to the Agent, any member of the Lender Group
or any other party in connection with this Agreement are and will be accurate,
true and correct in all material respects.

       (i)  No Servicer Default.  No event has occurred and is continuing and no
condition exists, or would result from a Borrowing or from the application of
the proceeds therefrom, which constitutes or may reasonably be expected to
constitute a Servicer Default.

       (j)  Material Adverse Change.  Since December 31, 2007, there has been no
Material Adverse Change with respect to the initial Servicer.

       (k)  Credit and Collection Policy.  It has at all times, since the
adoption of the Credit and Collection Policy, complied with the Credit and
Collection Policy with respect to each Transferred Loan.

Section 4.09.  Covenants of the Servicer.

The Servicer hereby covenants that:

       (a)  Compliance with Law.  The Servicer will comply in all material
respects with all Applicable Laws, including those with respect to the
Transferred Loans, the Related Property and Obligor Loan Documents or any part
thereof.

       (b)  Preservation of Corporate Existence.  The Servicer will preserve and
maintain its corporate existence, rights, franchises and privileges in the
jurisdiction of its formation, and qualify and remain qualified in good standing
as a foreign corporation in each jurisdiction where the failure to maintain such
existence, rights, franchises, privileges and qualification could reasonably be
expected to have, a Material Adverse Effect.

       (c)  Obligations with Respect to Transferred Loans.  The Servicer will
duly fulfill and comply with all obligations on the part of the Borrower to be
fulfilled or complied with under or in connection with each Transferred Loan
under this Agreement, the Loan Agreement or any other Loan Document and will do
nothing to impair the rights of the Borrower or the Agent, on behalf of Lender
Group, in, to and under the Collateral.

       (d)  Preservation of Security Interest.  The Borrower or the initial
Servicer on behalf of the Borrower will execute and file (or cause the execution
and filing of) such financing and continuation statements and any other
documents and take such other actions that may be required by any law or
regulation of any Governmental Authority to preserve and protect fully the
interest of the Agent, on behalf of Lender Group, in, to and under the
Collateral.

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       (e)  Change of Name or Location; Records.  The initial Servicer (i) shall
not change its name, move the location of its principal executive office or
change its jurisdiction of incorporation, without 30 days’ prior written notice
to the Borrower and the Agent, and (ii) shall not move, or, if a Collateral
Custodian has been appointed, consent to the Collateral Custodian moving the
Obligor Loan Documents, without 45 days’ prior written notice to the Borrower
and the Agent, and (iii) will promptly take all actions required of each
relevant jurisdiction in order to continue the first priority perfected security
interest of the Agent, on behalf of Lender Group, in all Collateral, including
delivery of an Opinion of Counsel.

       (f)  Credit and Collection Policy.  The initial Servicer will (i) comply
in all material respects with the Credit and Collection Policy in regard to each
Transferred Loan and the Related Property included in the Collateral, including,
without limitation, performing the loan grading and asset valuation functions
specified in the Credit and Collection Policy on a quarterly basis, and (ii)
furnish to the Agent, at least ten Business Days prior to its proposed effective
date, notice of any proposed change in the Credit and Collection Policy.  The
initial Servicer will not agree or otherwise permit any change in the Credit and
Collection Policy without the prior written consent of the Agent (which consent
shall not unreasonably be withheld), and Agent shall be deemed to have consented
to any such proposed change unless Agent has notified Servicer to the contrary
no later than ten Business Days after Agent’s receipt of such notice from
Servicer.

       (g)  Notice of Certain Events.  The Servicer will furnish to the Agent,
as soon as possible and in any event within one Business Day after the Servicer
shall have knowledge of the occurrence of any Default or Event of Default, a
written statement setting forth the details of such event and the action that
the Servicer proposes to take with respect thereto.

       (h)  Extension or Amendment of Transferred Loans.  The Servicer will not,
except as otherwise permitted in Section 4.04(a), extend, amend or otherwise
modify the terms of any Transferred Loan.

       (i)  Other.  The Servicer will furnish to the Agent and the Lender Group
such other information, documents records or reports respecting the Transferred
Loans or the condition or operations, financial or otherwise of the Servicer as
the Borrower, the Agent or the Lender Group may from time to time reasonably
request in order to protect the respective interests of the Borrower, the Agent
or the Lender Group under or as contemplated by this Agreement, the Loan
Agreement or any other Loan Document.

       (j)  [Intentionally Omitted].  

       (k)  Inspection of Records.  The Servicer will, at any time and from time
to time during regular business hours, as requested by the Agent (in the case of
a Successor Servicer, with at least with five Business Days notice), permit the
Agent and the Lender Group, or their respective agents or representatives, (i)
to examine and make copies of and take abstracts from all books, records and
documents (including computer tapes and disks) relating to the Transferred Loans
and the related Obligor Loan Documents and (ii) to visit the offices and
properties of the Borrower, the Originator or the Servicer, as applicable, for
the purpose of examining such materials described in clause (i), and to discuss
matters relating to the Transferred Loans or the Borrower’s, the Originator’s or
the Servicer’s performance hereunder, under the Obligor Loan Documents and under
the other Loan Documents to which such Person is a party with such officers,
directors, employees or independent public accountants of the Borrower, the
Originator or the Servicer, as applicable, as might reasonably be determined to
have knowledge of such matters.  Prior to the occurrence of an Event of Default
or a Trigger Event, the Servicer (or, if a Successor Servicer has been
appointed, the Borrower) shall bear the expense of up to three such inspections
in any 12-month period.  Upon and after the occurrence of an Event of Default,
the initial Servicer shall be required to bear the expense of all such
inspections.

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       (l)  Keeping of Records.  The Servicer will maintain and implement
administrative and operating procedures (including, in the case of the initial
Servicer,  an ability to recreate records evidencing Transferred Loans and the
related Obligor Loan Documents in the event of the destruction of the originals
thereof), and keep and maintain, all documents, books, computer tapes, disks,
records and other information reasonably necessary or advisable for the
collection of all Transferred Loans (including records adequate to permit the
daily identification of each new Transferred Loan and all Collections of and
adjustments to each existing Transferred Loan).  The Servicer shall give the
Agent and Backup Servicer (with a copy to the Collateral Custodian, if one has
been appointed) prompt notice of any material change in its administrative and
operating procedures referred to in the previous sentence.

       (m)  Compliance with Transferred Loans.  The Servicer will (i) at its own
expense, timely and fully perform and comply with all material provisions,
covenants and other promises required to be observed by it under the Transferred
Loans and the related Obligor Loan Documents; and (ii) timely and fully comply
in all material respects with the Credit and Collection Policy with respect to
each Transferred Loan and the related Obligor Loan Documents.

       (n)  Consolidation or Merger of the Servicer.  The initial Servicer shall
not consolidate or merge with or into, or sell, lease or transfer all or
substantially all of its assets to, any other Person, unless, in the case of any
such action (i) no Event of Default or Material Adverse Effect would occur or be
reasonably likely to occur as a result of such transaction, (ii) Agent provides
its prior written consent to such transaction and (iii) such Person executes and
delivers to the Agent an agreement by which such Person assumes the obligations
of the Servicer hereunder and under the other Loan Documents to which it is a
party, or confirms that such obligations remain enforceable against it, together
with such certificates and opinions of counsel as the Agent may reasonably
request.

Section 4.10.  The Collateral Custodian; The Agent.

       (a)  Appointment; Custodial Duties.  The appointment, duties and
compensation of the Collateral Custodian, if one is appointed, shall be provided
for in its Collateral Custodian Agreement.

       (b)  Concerning the Agent.

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           (i)  Except for its willful misconduct, gross negligence or bad
faith, the Agent may conclusively rely on and shall be fully protected in acting
upon any certificate, instrument, opinion, notice, letter, telegram or other
document delivered to it and that in good faith it reasonably believes to be
genuine and that has been signed by the proper party or parties.  In no event
shall the Agent be liable for special, indirect or consequential loss or damage
of any kind whatsoever (including but not limited to lost profits).

          (ii)  The Agent may consult counsel satisfactory to it and the advice
or opinion of such counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it hereunder
in good faith and in accordance with the advice or opinion of such counsel.

         (iii)  The Agent shall not be liable for any error of judgment, or for
any act done or step taken or omitted by it, in good faith, or for any mistakes
of fact or law, or for anything that it may do or refrain from doing in
connection herewith except in the case of its willful misconduct, gross
negligence or bad faith.

          (iv)  The Agent makes no warranty or representation and shall have no
responsibility (except as expressly set forth in this Agreement) as to the
content, enforceability, completeness, validity, sufficiency, value,
genuineness, ownership or transferability of the Loans or the Obligor Loan
Documents, and will not be required to and will not make any representations as
to the validity or value of any of the Loans.  The Agent shall not be obligated
to take any legal action hereunder that might in its judgment involve any
expense or liability unless it has been furnished with an indemnity reasonably
satisfactory to it.

           (v)  The Agent shall have no duties or responsibilities under this
Agreement except such duties and responsibilities as are specifically set forth
in this Agreement and no covenants or obligations shall be implied in this
Agreement against the Agent.

          (vi)  The Agent shall not be required to expend or risk its own funds
in the performance of its duties hereunder.

         (vii)  It is expressly agreed and acknowledged that the Agent is not
guaranteeing performance of or assuming any liability for the obligations of the
other parties hereto or any parties to the Transferred Loans.

       (c)  Release for Servicing.  From time to time and as appropriate for the
enforcement or servicing of any of the Transferred Loans, the Agent is hereby
authorized, upon receipt from the Servicer on behalf of the Borrower, of a
written request for release of documents and receipt in the form annexed hereto
as Exhibit F to release to the Servicer the related Loan File or the documents
set forth in such request and receipt to the Servicer.  All documents so
released to the Servicer on behalf of the Borrower shall be held by the Servicer
in trust for the benefit of the Borrower, the Agent and the Lender Group, with
respect to their respective interests, in accordance with the terms of this
Agreement.  The Servicer, on behalf of the Borrower, shall return to the Agent
the Loan File or other such documents when the Servicer’s need therefor in
connection with such foreclosure or servicing no longer exists, unless the
Transferred Loan shall be liquidated, in which case, upon receipt of an
additional request for release of documents and receipt certifying such
liquidation from the Servicer to the Agent in the form annexed hereto as Exhibit
F, the Servicer’s request and receipt submitted pursuant to the first sentence
of this Section 4.10(c) shall be released by the Agent to the
Servicer.  Notwithstanding anything in this Section 4.10(c) to the contrary, in
no event shall the Agent be required to release any Loan File or part thereof to
the Servicer.

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       (d)  Release for Payment.  Upon receipt by the Agent of the Servicer’s
request for release of documents and receipt in the form annexed hereto as
Exhibit F (which certification shall include a statement to the effect that all
amounts received in connection with such payment or repurchase have been
credited to the Cash Management Account as provided in this Agreement and the
Loan Agreement), the Agent shall promptly release the related Loan File to the
Servicer, on behalf of the Borrower.

Section 4.11.  [Intentionally Omitted].

Section 4.12.  [Intentionally Omitted].

Section 4.13.  The Backup Servicer.

       (a)  Appointment.  The Borrower and the Agent hereby appoint Lyon
Financial to act as Backup Servicer for the benefit of the Borrower, the Agent
and the Lender Group in accordance with the terms of this Agreement.  Lyon
Financial hereby accepts such appointment and agrees to perform the duties and
responsibilities with respect thereto set forth herein.

       (b)  Duties.  On or before the initial Borrowing Date, and until the
receipt by the Servicer of a notice of termination pursuant to Section 9.01
hereof, the Backup Servicer shall perform, on behalf of the Borrower and the
Agent, for the benefit of the Lender Group, the following duties and
obligations:

           (i)  On or before the Closing Date, the Backup Servicer shall accept
from the Servicer delivery of the information required to be set forth in the
Servicer Reports in hard copy and in an agreed upon electronic format.

          (ii)  Not later than 12:00 noon (New York City time) on each Record
Date (or with respect to the initial Payment Date, the fourth Business Day
preceding the Payment Date), the Servicer shall provide to the Backup Servicer
and the Backup Servicer shall accept delivery of tape in an agreed upon
electronic format (the “Loan Tape”) from the Servicer, which shall include but
not be limited to the following information:  (x) for each Transferred Loan, the
name and number of the related Obligor, the collection status, the loan status,
the date of each Scheduled Payment and the Outstanding Loan Balance and (y) the
Aggregate Outstanding Loan Balance.

         (iii)            Prior to the related Payment Date, the Backup Servicer
shall review the Servicer Report to ensure that it is complete on its face and
that the following items in such Servicer Report have been accurately
calculated, if applicable, and reported:  (A) the Availability, (B) the
Aggregate Outstanding Loan Balance, (C) the Backup Servicer Fee, (D) the
Delinquent Loans, (E) the Defaulted Loans, and (F) the Charged-Off Loans.  The
Backup Servicer shall notify the Agent and the Servicer of any disagreements
with the Servicer Report based on such review not later than the Business Day
preceding such Payment Date.

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          (iv)  If the Borrower or the Servicer disagrees with the report
provided under Section 4.13(b)(iii) by the Backup Servicer or if the Borrower or
the Servicer or any subservicer has not reconciled such discrepancy, the Backup
Servicer agrees to confer with the Borrower or the Servicer to resolve such
disagreement on or prior to the next succeeding Record Date and shall settle
such discrepancy with the Borrower or the Servicer if possible, and notify the
Agent of the resolution thereof.  The Borrower or the Servicer hereby agree to
cooperate at their own expense, with the Backup Servicer in reconciling any
discrepancies herein.  If within 20 days after the delivery of the report
provided under Section 3.13(b)(iii) by the Backup Servicer, such discrepancy is
not resolved, the Backup Servicer shall promptly notify the Agent and the
Servicer of the continued existence of such discrepancy.  Following receipt of
such notice by the Servicer, the Servicer shall deliver to the Borrower, the
Agent and the Backup Servicer no later than the related Payment Date a
certificate describing the nature and amount of such discrepancies and the
actions the Servicer proposes to take with respect thereto.

With respect to the duties described in this Section 4.13(b), in the absence of
bad faith or gross negligence, the Backup Servicer, in the performance of its
duties and obligations hereunder, is entitled to rely conclusively, and shall be
fully protected in so relying, on the contents of each Loan Tape, including, but
not limited to, the completeness and accuracy thereof, provided by the Servicer.

       (c)  Transition to Servicer Role.  After the receipt by the Servicer of
an effective notice of termination pursuant to Section 9.01, all authority,
power, rights and responsibilities of the Servicer under this Agreement, whether
with respect to the Transferred Loans or otherwise, shall pass to and be vested
in the Backup Servicer, subject to and in accordance with the provisions of
Section 4.21, as long as the Backup Servicer is not prohibited by Applicable Law
from fulfilling the same, as evidenced by an Opinion of Counsel.

       (d)  Merger or Consolidation.  Any Person (i) into which the Backup
Servicer may be merged or consolidated, (ii) that may result from any merger or
consolidation to which the Backup Servicer shall be a party, or (iii) that may
succeed to the properties and assets of the Backup Servicer substantially as a
whole, which Person in any of the foregoing cases executes an agreement of
assumption to perform every obligation of the Backup Servicer hereunder, shall
be the successor to the Backup Servicer under this Agreement without further act
on the part of any of the parties to this Agreement.

       (e)  Backup Servicing Compensation.  As compensation for its backup
servicing activities hereunder, the Backup Servicer shall be entitled to receive
the Backup Servicer Fee from the Servicer and such other amounts that are
provided for in the Backup Servicer Fee Letter.  To the extent such Backup
Servicer Fee is not paid by the Servicer, the Backup Servicer shall be entitled
to receive the unpaid balance of its Backup Servicer Fee to the extent of funds
available therefor pursuant to the provision of Section 2.3(b) of the Loan
Agreement.  The Backup Servicer’s entitlement to receive the Backup Servicer Fee
(other than due and unpaid Backup Servicer Fees owed through such date) shall
cease on the earliest to occur of:  (i) it becoming the successor Servicer, (ii)
its removal as Backup Servicer, or (iii) the Termination Date.

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       (f)  Backup Servicer Removal.  The Backup Servicer may be removed with or
without cause by the Agent, or by the Borrower with the prior written approval
of the Agent by notice given in writing to the Backup Servicer.  In the event of
any such removal, a replacement Backup Servicer may be appointed by (i) the
Borrower, acting with the written consent of the Agent or (ii) if no such
replacement is appointed within 30 days following such removal, by the Agent.

       (g)  Scope of Backup Servicing Duties.  The Backup Servicer undertakes to
perform only such duties and obligations as are specifically set forth in this
Agreement, it being expressly understood by all parties hereto that there are no
implied duties or obligations of the Backup Servicer hereunder.  Without
limiting the generality of the foregoing, the Backup Servicer, except as
expressly set forth herein, shall have no obligation to supervise, verify,
monitor or administer the performance of the Servicer.  The Backup Servicer may
act through its agents, attorneys and custodians in performing any of its duties
and obligations under this Agreement, it being understood by the parties hereto
that the Backup Servicer will be responsible for any misconduct or negligence on
the part of such agents, attorneys or custodians acting on the routine and
ordinary day-to-day operations for and on behalf of the Backup
Servicer.  Neither the Backup Servicer nor any of its officers, directors,
employees or agents shall be liable, directly or indirectly, for any damages or
expenses arising out of the services performed under this Agreement other than
damages or expenses that result from the gross negligence or bad faith of it or
them or the failure to perform materially in accordance with this Agreement.

       (h)  Limitation on Liability.  No provision of this Agreement shall be
construed to relieve the Backup Servicer from its own gross negligence, willful
misconduct or bad faith, except that:  (i) the Backup Servicer shall not be
liable for any obligation of the Servicer contained in this Agreement or for any
errors of the Servicer contained in any computer tape, certificate or other data
or document delivered to the Backup Servicer hereunder or on which the Backup
Servicer must rely in order to perform its obligations hereunder, and the
Borrower, the Agent, the Collateral Custodian (if one is appointed), the Backup
Servicer and the Lender Group each agree to look only to the Servicer to perform
such obligations; (ii) the Backup Servicer shall have no responsibility and
shall not be in default hereunder or incur any liability for any failure, error,
malfunction or any delay in carrying out any of their respective duties under
this Agreement if such failure or delay results from the Backup Servicer acting
in accordance with information prepared or supplied by a Person other than the
Backup Servicer or the failure of any such other Person to prepare or provide
such information; and (iii) the Backup Servicer shall have no responsibility,
shall not be in default and shall incur no liability for (A) any act or failure
to act of any third party, including the Servicer (B) any inaccuracy or omission
in a notice or communication received by the Backup Servicer from any third
party, (C) the invalidity or unenforceability of any Transferred Loan or Obligor
Loan Document under Applicable Law, (D) the breach or inaccuracy of any
representation or warranty made with respect to any Transferred Loan, or (E) the
acts or omissions of any successor Backup Servicer.  In no event will the Backup
Servicer (including in its capacity as Successor Servicer) be liable for any
indirect damages, lost profits, special, punitive, or consequential damages
which arise out of or in connection with the services contemplated by this
Agreement even if the Backup Servicer has been informed of the possibility of
such damages.  The Backup Servicer undertakes to perform only such duties and
obligations as are specifically set forth in this Agreement, it being expressly
understood by all parties hereto that there are no implied duties or obligations
of the Backup Servicer hereunder.  If the Backup Servicer (including in its
capacity as successor Servicer) is prevented from fulfilling its obligations
hereunder as a result of government actions, regulations, fires, strikes,
accidents, acts of god or other causes beyond its control, its obligations shall
be suspended for a reasonable time during which such conditions exist.

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Section 4.14.  Representations and Warranties of the Backup Servicer.

The Backup Servicer hereby represents and warrants as follows:

       (a)  Organization and Good Standing.  It is a Minnesota corporation duly
organized, validly existing and in good standing under the laws of the United
States with all requisite power and authority to own its properties and to
conduct its business as presently conducted and to enter into and perform its
obligations pursuant to this Agreement.

       (b)  Due Qualification.  The Backup Servicer is duly qualified to do
business as a national banking association and is in good standing, and have
obtained all necessary licenses and approvals in all jurisdictions in which the
ownership or lease of its property and the conduct of its business requires such
qualification, licenses or approvals except where the failure to so qualify or
have such licenses or approvals has not had, and would not be reasonably
expected to have, a Material Adverse Effect.

       (c)  Power and Authority.  It has the power and authority to execute and
deliver this Agreement and to carry out its terms.  It has duly authorized the
execution, delivery and performance of this Agreement by all requisite action.

       (d)  No Violation.  The consummation of the transactions contemplated by,
and the fulfillment of the terms of, this Agreement by it will not (i) conflict
with, result in any breach of any of the terms or provisions of, or constitute a
default under, its articles of association or any contractual obligation by
which it or any of its property is bound, (ii) result in the creation or
imposition of any Lien upon any of its properties pursuant to the terms of any
contractual obligation (other than the Agreement), or (iii) violate any
Applicable Law.

       (e)  No Consents.  No Consents of or with any Governmental Authority
having jurisdiction over it or any of its respective properties is required to
be obtained in order for it to enter into this Agreement or perform its
obligations hereunder.

       (f)  Binding Obligation.  This Agreement constitutes its legal, valid and
binding obligation, enforceable in accordance with its terms, except as such
enforceability may be limited by (i) applicable Bankruptcy Laws and (ii) general
principles of equity (whether considered in a suit at law or in equity).

       (g)  No Proceedings.  There are no proceedings or investigations pending
or, to the best of its knowledge, threatened, against it before any Governmental
Authority (i) asserting the invalidity of this Agreement, (ii) seeking to
prevent the consummation of any of the transactions contemplated by this
Agreement or (iii) seeking any determination or ruling that might (in its
reasonable judgment) have a Material Adverse Effect.

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Section 4.15.  Covenants of the Backup Servicer.

The Backup Servicer hereby covenants that:

       (a)  Compliance with Law.  The Backup Servicer will comply in all
material respects with all Applicable Laws.

       (b)  Preservation of Existence.  The Backup Servicer will preserve and
maintain its existence, rights, franchises and privileges as a national banking
association in good standing under the laws of the United States.

       (c)  No Bankruptcy Petition.  Prior to the date that is one year and one
day (or such longer preference period as shall then be in effect) after the
Collection Date, the Backup Servicer will not institute against the Borrower, or
join any other Person in instituting against the Borrower, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings or other
similar proceedings under the laws of the United States or any state of the
United States.  This Section 4.15(c) will survive the termination of this
Agreement.

       (d)  No Changes in Backup Servicer Fee.  The Backup Servicer will not
make any changes to Backup Servicer Fee set forth in the Backup Servicer Fee
Letter without the prior written approval of the Agent.

Section 4.16.  Payment of Certain Expenses by the Servicer and the Borrower.

       (a)  The Servicer will be required to pay all fees and expenses incurred
by it in connection with the transactions and activities contemplated by this
Agreement, including fees and disbursements of legal counsel and independent
accountants, taxes imposed on the Servicer, expenses incurred in connection with
payments and reports pursuant to this Agreement, and all other fees and expenses
not expressly stated under this Agreement for the account of the Borrower.  In
consideration for the payment by the Borrower of the Servicing Fee, the Servicer
(so long as it is the Originator or an Affiliate thereof) will be required to
pay all reasonable fees and expenses owing to any bank or trust company in
connection with the maintenance of the Cash Management Accounts, and the Backup
Servicer Fee pursuant to the Backup Servicer Fee Letter, and any Collateral
Custodian Fee pursuant to any Collateral Custodian Agreement.  The Servicer
shall be required to pay such expenses for its own account and shall not be
entitled to any payment therefor other than the Servicing Fee.

       (b)  The Borrower will be required to pay all fees and expenses incurred
by the Agent, Lender Group or any Successor Servicer in connection with the
transactions and activities contemplated by this Agreement, including reasonable
fees and disbursements of legal counsel and independent accountants.

Section 4.17.  Reports.

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       (a)  Servicer Report.  With respect to each Record Date and the related
Collection Period, the Servicer will provide to the Borrower, the Backup
Servicer, and the Agent (and if so requested by Agent, with copies for each
Lender), on the related Record Date, a monthly statement (a “Servicer Report”),
signed by a Responsible Officer of the Servicer and substantially in the form of
Exhibit A.  Except as otherwise set forth herein, the Backup Servicer shall have
no obligation to review any information in the Servicer Report.

       (b)  Servicer’s Certificate.  Together with each Servicer Report, the
Servicer shall submit to the Borrower, the Backup Servicer, and the Agent (and
if so requested by Agent, with copies for each Lender) a certificate
substantially in the form of Exhibit G (a “Servicer’s Certificate”), signed by a
Responsible Officer of the Servicer, which shall include a certification by such
Responsible Officer that no Default or Event of Default has occurred and is
continuing.  Except as otherwise set forth herein, the Backup Servicer shall
have no duty to review any information set forth in the Servicer’s Certificate.

       (c)  Financial Statements.  The initial Servicer will submit to the
Borrower, the Backup Servicer, and the Agent (and if so requested by Agent, with
copies for each Lender), within 45 days following the end of each of the
Servicer’s fiscal quarters (other than the final fiscal quarter), commencing for
the fiscal quarter ending on September 30, 2008, unaudited financial statements
of the Servicer (including an analysis of delinquencies and losses for each
fiscal quarter) as of the end of each such fiscal quarter.  The Servicer shall
submit to the Borrower, the Backup Servicer, and the Agent (and if so requested
by Agent, with copies for each Lender), within 90 days following the end of the
Servicer’s fiscal year, commencing with the fiscal year ending on December 31,
2008, annual audited financial statements as of the end of such fiscal
year.  Except as otherwise set forth herein, the Backup Servicer shall have no
duty to review any of the financial information set forth in such financial
statements.

Section 4.18.  Annual Statement as to Compliance.

The Servicer will provide to the Borrower, the Backup Servicer, Agent (and if so
requested by Agent, with copies for each Lender), and the Collateral Custodian
(if one has been appointed), within 90 days following the end of each fiscal
year of the Servicer, commencing with the fiscal year ending on December 31,
2008, an annual report signed by a Responsible Officer of the Servicer
certifying that (a) a review of the activities of the Servicer, and the
Servicer’s performance pursuant to this Agreement, for the period ending on the
last day of such fiscal year has been made under such Responsible Officer’s
supervision and (b) the Servicer has performed or has caused to be performed in
all material respects all of its obligations under this Agreement throughout
such year and no Servicer Default has occurred and is continuing (or if a
Servicer Default has occurred and is continuing, specifying each such event, the
nature and status thereof and the steps necessary to remedy such event, and, if
a Servicer Default occurred during such year and no notice thereof has been
given to the Agent, specifying such Servicer Default and the steps taken to
remedy such event).

Section 4.19.  [Intentionally Omitted].

Section 4.20.  Limitation on Liability.

Except as provided herein, none of the directors or officers or employees or
agents of the Servicer shall be under any liability to the Borrower, the Agent,
the other members of the Lender Group or any other Person for any action taken
or for refraining from the taking of any action as expressly provided for in
this Agreement; provided, that this provision shall not protect any such Person
against any liability that would otherwise be imposed by reason of its willful
misfeasance, bad faith or negligence (except with regard to the Backup Servicer
when acting as successor servicer, gross negligence and not negligence shall
apply) in the performance of duties or by reason of its failure to perform
materially in accordance with this Agreement.

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The Servicer shall not be under any obligation to appear in, prosecute or defend
any legal action that is not incidental to its duties to service the Transferred
Loans in accordance with this Agreement that in its reasonable opinion may
involve it in any expense or liability.  The Servicer may, in its sole
discretion, undertake any legal action relating to the servicing, collection or
administration of Transferred Loans and the Related Property that it may
reasonably deem necessary or appropriate for the benefit of the Borrower and the
Lender Group with respect to this Agreement and the rights and duties of the
parties hereto and the respective interests of the Borrower and the Lender Group
hereunder.

Section 4.21.  The Servicer and the Backup Servicer Not to Resign.

Neither the Servicer nor the Backup Servicer shall resign from the obligations
and duties hereby imposed on such Person except upon such Person’s determination
that (i) the performance of its duties hereunder is or becomes impermissible
under Applicable Law and (ii) there is no reasonable action that such Person
could take to make the performance of its duties hereunder permissible under
Applicable Law.  Any such determination permitting the resignation of the
Servicer or the Backup Servicer shall be evidenced as to clause (i) above by an
Opinion of Counsel to such effect delivered to the Borrower and the Agent.  No
such resignation shall become effective until a successor shall have assumed the
responsibilities and obligations of such Person in accordance with the terms of
this Agreement.  Notwithstanding the foregoing, the Backup Servicer reserves the
right, in the exercise of its own discretion, to terminate this Agreement upon
not less than one hundred eighty (180) days notice to the other party, with a
copy to the Agent, Borrower and the Servicer.

Section 4.22.  Access to Certain Documentation and Information Regarding the
Transferred Loans.

The Borrower, the Servicer or, the Collateral Custodian (if one has been
appointed), as applicable, shall provide to the Backup Servicer, the Agent and
the Lender Group access to the Obligor Loan Documents and all other
documentation regarding the Transferred Loans included as part of the Collateral
and the Related Property in such cases where the Agent is required in connection
with the enforcement of the rights or interests of the Agent or the Lender
Group, or by applicable statutes or regulations, to review such documentation,
such access being afforded without charge but only (i) upon two Business Days’
prior written request, (ii) during normal business hours and (iii) subject to
the Servicer’s and the Collateral Custodian’s normal security and
confidentiality procedures.  From and after the Closing Date and periodically
thereafter at the discretion of the Agent or the applicable member of the Lender
Group, the Agent, such member of the Lender Group or its agents may review the
Borrower’s and the Servicer’s collection and administration of the Transferred
Loans in order to assess compliance by the Servicer with the Servicer’s written
policies and procedures, as well as with this Agreement and may conduct an audit
of the Transferred Loans, Obligor Loan Documents and Records in conjunction with
such a review.  Such review shall be reasonable in scope and shall be completed
in a reasonable period of time.  A Successor Servicer shall be entitled to at
least five Business Days notice prior to such review.  The Borrower shall bear
the cost of such audits.

Section 4.23.  Identification of Records.

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The Servicer shall clearly and unambiguously identify each Transferred Loan that
is part of the Collateral and the Related Property in its computer or other
records to reflect that the interest in such Transferred Loans and Related
Property have been transferred to and are owned by the Borrower and that the
Agent, on behalf of the Lender Group, has the security interest and Lien therein
granted by Borrower pursuant to the Loan Agreement.

ARTICLE V  

ESTABLISHMENT OF CASH MANAGEMENT ACCOUNT

Section 5.01.  Cash Management Account.

       (a)  Establishment of Cash Management Account.  The Servicer, for the
benefit of the Agent and the Lender Group, shall cause to be established and
maintained a Cash Management Account in accordance with the requirements of
Section 2.6 of the Loan Agreement.

       (b)  Deposits to Cash Management Account.  The Servicer shall deposit or
cause to be deposited all Collections on or in respect of each Transferred Loan
collected on or after the related Transfer Date (to the extent received by the
Servicer) within one Business Day after receipt thereof.  The Servicer agrees
that it will cause the Originator or other appropriate Person paying such
amounts, as the case may be, to remit directly to the Cash Management Account,
within one Business Day after receipt thereof, all such amounts to the extent
such amounts are received by such Person.  

ARTICLE VI  

[RESERVED]

ARTICLE VII  

COVENANTS

Section 7.01.  Financial and Serviced Portfolio Covenants of Hercules.

       (a)  Minimum Tangible Net Worth.  Hercules, on a consolidated basis with
its Subsidiaries, shall maintain as of the end of each of its fiscal quarters a
sum of (i) Tangible Net Worth, plus (ii) Subordinated Debt, that is greater than
or equal to the sum of (A) $360,000,000, plus (B) ninety percent (90%) of the
cumulative amount of equity raised by Hercules from and after the Closing Date.

       (b)  Maximum Debt to Worth Ratio.  Hercules, on a consolidated basis with
its Subsidiaries, shall maintain as of the end of each of its fiscal quarters a
Debt to Worth Ratio that is less than or equal to 1.25 to 1.00.

       (c)  Minimum Interest Coverage Ratio. Hercules, on a consolidated basis
with its Subsidiaries, shall maintain, as measured on the last day of each of
its fiscal quarters, an Interest Coverage Ratio for the three (3) fiscal month
period then ended that is greater than or equal to 2.00 to 1.00.

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       (d)  Minimum Portfolio Funding Liquidity Covenant.  Hercules, on a
consolidated basis with its Subsidiaries, shall maintain, as measured on the
last day of each of its fiscal months, an aggregate amount of unrestricted cash
balances and borrowing availability under committed lines of credit that is
greater than or equal to seventy-five percent (75%) of the aggregate amount of
unfunded commitments of Borrower to Obligors under the Transferred Loans.

       (e)  Maximum Delinquent Notes Receivable Percentage of Hercules’ Serviced
Portfolios.  Hercules shall not permit the aggregate unpaid principal balance of
all loans that are serviced by Hercules for its Subsidiaries and Affiliates with
respect to which any payment thereunder remains outstanding and unpaid, in whole
or in part, for more than sixty (60) days past the date it became due and
payable as of the last day of any fiscal month, to be in excess of ten percent
(10%) of the aggregate unpaid principal balance of all such loans serviced by
Hercules as of such day.

       (f)  Maximum Defaulted Notes Receivable Percentage of Hercules’ Serviced
Portfolios.  Hercules shall not permit the aggregate unpaid principal balance of
all loans that are serviced by Hercules for its Subsidiaries and Affiliates with
respect to which (a) any payment thereunder remains outstanding and unpaid, in
whole or in part, for more than ninety (90) days past the date it became due and
payable according to the original face and tenor of such loan, (b) with respect
to which foreclosure proceedings have been initiated against any property
securing such loan, or (c) that Hercules deems to be non-collectible as of the
last day of any fiscal month, to be in excess of ten percent (10%) of the
aggregate unpaid principal balance of all such loans serviced by Hercules as of
such day.

Section 7.02.  Covenants Regarding Purchased Assets.

       (a)  Protect Collateral.  The Originator agrees that it shall not sell,
assign, transfer, pledge or encumber in any other manner the Purchased Assets
(except for the assignment and pledge to the Borrower hereunder and the
Borrower’s grant of a security interest in the Collateral to the Agent under the
Loan Agreement).  The Originator shall warrant and defend the right and title
herein granted unto the Borrower in and to the Purchased Assets (and all right,
title and interest represented by the Collateral) against the claims and demands
of all Persons whomsoever.

       (b)  Further Assurances.  The Originator shall, at its own expense,
promptly execute and deliver all further instruments (including financing
statements, stock powers, other powers and other instruments of transfer or
control) requested by the Agent to perfect and protect the transfer of the
Purchased Assets to the Borrower or any security interest granted or purported
to be granted hereby or under the Loan Agreement, or to enable the Borrower
and/or the Agent, as applicable, to exercise and enforce its rights and remedies
hereunder with respect to the Purchased Assets or under the Loan Agreement with
respect to any Collateral, including the rights and remedies under Section 9 of
the Loan Agreement.  In addition, the Originator shall, at its own expense,
promptly take all further action that Agent may request in order to perfect and
protect the transfer of the Purchased Assets to the Borrower or any security
interest granted or purported to be granted hereby or under the Loan Agreement,
or to enable the Borrower and/or the Agent, as applicable, to exercise and
enforce its rights and remedies hereunder with respect to the Purchased Assets
or under the Loan Agreement with respect to any Collateral, including the rights
and remedies under Section 9 of the Loan Agreement.

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       (c)  Collections Held in Trust.  If the Originator receives any
Collections, the Originator shall hold such Collections separate and apart from
its other property in trust for the Borrower and shall, within two Business Days
after receipt thereof, deposit such Collections to the Cash Management Account.

       (d)  Consents.  The Originator shall execute and deliver to the Borrower
and/or the Agent, as applicable, upon request and at the time the Borrower
and/or the Agent, as applicable, exercises its remedies, any document deemed
necessary by the Borrower and/or the Agent, as applicable, in order to evidence
the the Originator’s consent to the Borrower and/or the Agent exercising their
respective remedies hereunder with respect to the Purchased Assets or under the
Loan Agreement with respect to any Collateral, including the rights and remedies
under Section 9 of the Loan Agreement.

ARTICLE VIII  

THE SERVICER AND THE COLLATERAL CUSTODIAN

Section 8.01.  Indemnification; Third Party Claims.

       (a)  The Servicer (so long as it is the Originator or an Affiliate
thereof) shall indemnify the Originator, the Borrower, the Agent and each other
member of the Lender Group, the Collateral Custodian (if one has been
appointed), and the Backup Servicer (in its capacity os Backup Servicer and its
capacity as Successor Servicer), their respective officers, directors,
employees, agents and “control persons,” as such term is used under the
Securities Act and under the Exchange Act (each a “Servicer Indemnified Party”)
and hold harmless each of them against any and all claims, losses, damages,
penalties, fines, forfeitures, reasonable legal fees and related costs,
judgments, and other costs and expenses resulting from any claim, demand,
defense or assertion based on or grounded upon, or resulting from, a breach of
any of the Servicer’s representations and warranties and covenants contained in
this Agreement or in any way relating to the failure of the Servicer to perform
its duties and service the Transferred Loans in compliance with the terms of
this Agreement except to the extent such loss arises out of such Servicer
Indemnified Party’s fraud, gross negligence or willful misconduct; provided,
however, that if the Servicer is not liable pursuant to the provisions of
Section 8.01(b) hereof for its failure to perform its duties and service the
Transferred Loans in compliance with the terms of this Agreement, then the
provisions of this Section 8.01 shall have no force and effect with respect to
such failure; provided, further that (i) no successor Servicer shall be liable
for the breaches of representations or warranties or covenants, or actions or
omissions, of a predecessor Servicer; and (ii) the Servicer shall not be so
required to indemnify a Servicer Indemnified Party or to otherwise be liable to
an Servicer Indemnified Party for any losses in respect of the non-performance
of the Transferred Loans, the creditworthiness of the Obligors with respect to
the Transferred Loans, changes in the market value of the Transferred Loans or
other similar investment risks associated with the Transferred Loans arising
from a breach of any representation or warranty set forth in Section 3.03 hereto
if the effect of such indemnity would be to provide credit recourse to the
Originator for the performance of the Transferred Loans.

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       (b)  None of the Originator or the Servicer or any of their respective
Affiliates, directors, officers, employees or agents shall be under any
liability to the Borrower, the Agent or any member of the Lender Group for any
action taken, or for refraining from the taking of any action, in good faith
pursuant to this Agreement, or for errors in judgment; provided, however, that
this provision shall not protect the Originator, the Servicer or any of their
respective Affiliates, directors, officers, employees, agents against the
remedies provided herein for the breach of any warranties, representations or
covenants made herein, or against any expense or liability specifically required
to be borne by such party without right of reimbursement pursuant to the terms
hereof, or against any expense or liability which would otherwise be imposed by
reason of misfeasance, bad faith or negligence in the performance of the
respective duties of the Servicer or the Originator, as the case may be.  The
Originator, the Servicer and any of their respective Affiliates, directors,
officers, employees, agents may rely in good faith on any document of any kind
which, prima facie, is properly executed and submitted by any Person respecting
any matters arising hereunder.

       (c)  The Originator agrees to indemnify and hold harmless the Borrower,
the Agent, the Backup Servicer (in such capacity and in its capacity as
Successor Servicer), and the Lender Group, as the ultimate assignees from the
Origiator (each an “Originator Indemnified Party,” together with the Servicer
Indemnified Parties, the “Indemnified Parties”), from and against any loss,
liability, expense, damage, claim or injury arising out of or based on (i) any
breach of any representation, warranty or covenant of the Originator, the
Servicer or their Affiliates, in any Loan Document, including, without
limitation, by reason of any acts, omissions, or alleged acts or omissions
arising out of activities of the Originator, the Servicer or their Affiliates,
and (ii) any untrue statement by the Originator, the Servicer or its Affiliates
of any material fact, including, without limitation, any Officer’s Certificate,
statement, report or other document or information prepared by any such Person
and furnished or to be furnished by it pursuant to or in connection with the
transactions contemplated thereby and not corrected prior to completion of the
relevant transaction including, without limitation, such written information as
may have been and may be furnished in connection with any due diligence
investigation with respect to the Transferred Loans or any such Person’s
business, operations or financial condition, including reasonable attorneys’
fees and other costs or expenses incurred in connection with the defense of any
actual or threatened action, proceeding or claim; provided that the Originator
shall not indemnify an Originator Indemnified Party to the extent such loss,
liability, expense, damage or injury is due to either an Originator Indemnified
Party’s willful misfeasance, bad faith or gross negligence or by reason of an
Originator Indemnified Party’s reckless disregard of its obligations hereunder;
provided, further, that the Originator shall not be so required to indemnify an
Originator Indemnified Party or to otherwise be liable to an Originator
Indemnified Party for any losses in respect of the non-performance of the
Transferred Loans, the creditworthiness of the Obligors with respect to the
Transferred Loans, changes in the market value of the Transferred Loans or other
similar investment risks associated with the Transferred Loans arising from a
breach of any representation or warranty set forth in Section 3.03 hereto if the
effect of such indemnity would be to provide credit recourse to the Originator
for the performance of the Transferred Loans.  The provisions of this indemnity
shall run directly to and be enforceable by an Originator Indemnified Party
subject to the limitations hereof.

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       (d)  With respect to a claim subject to indemnity hereunder made by any
Person against an Indemnified Party (a “Third Party Claim”), such Indemnified
Party shall notify the related indemnifying parties (each an “Indemnifying
Party”) in writing of the Third Party Claim within a reasonable time after
receipt by such Indemnified Party of written notice of the Third Party Claim
unless the Indemnifying Parties shall have previously obtained actual knowledge
thereof.  Thereafter, the Indemnified Party shall deliver to the Indemnifying
Parties, within a reasonable time after the Indemnified Party’s receipt thereof,
copies of all notices and documents (including court papers) received by the
Indemnified Party relating to the Third Party Claim.  No failure to give such
notice or deliver such documents shall effect the rights to indemnity
hereunder.  Each Indemnifying Party shall promptly notify the Agent and the
Indemnified Party (if other than the Agent) of any claim of which it has been
notified and shall promptly notify the Agent and the Indemnified Party (if
applicable) of its intended course of action with respect to any claim.

       (e)  If a Third Party Claim is made against an Indemnified Party, while
maintaining control over its own defense, the Indemnified Party shall cooperate
and consult fully with the Indemnifying Party in preparing such defense, and the
Indemnified Party may defend the same in such manner as it may deem appropriate,
including settling such claim or litigation after giving notice to the
Indemnifying Party of such terms and the Indemnifying Party will promptly
reimburse the Indemnified Party upon written request; provided, however, that
the Indemnified Party may not settle any claim or litigation without the consent
of the Indemnifying Party; provided, further, that the Indemnifying Party shall
have the right to reject the selection of counsel by the Indemnified Party if
the Indemnifying Party reasonably determines that such counsel is inappropriate
in light of the nature of the claim or litigation and shall have the right to
assume the defense of such claim or litigation if the Indemnifying Party
determines that the manner of defense of such claim or litigation is
unreasonable.

Section 8.02.  Relationship of Servicer to the Borrower and the Agent.

The relationship of the Servicer (and of any successor to the Servicer as
servicer under this Agreement) to the Borrower and the Agent under this
Agreement is intended by the parties hereto to be that of an independent
contractor and not of a joint venturer, agent or partner of the Borrower or the
Agent.

Section 8.03.  Servicer May Be a Lender.

Each of the Servicer and any Affiliate of the Servicer may in its individual or
any other capacity become a Lender under the Loan Agreement with the same rights
as it would have if it were not the Servicer or an Affiliate thereof except as
otherwise specifically provided herein; provided, however, that at any time that
Hercules or any of its Affiliates is the Servicer, neither the Servicer nor any
of its Affiliates (other than an Affiliate which is a corporation whose purpose
is limited to holding securities and related activities and which cannot incur
recourse debt) may be a Lender.  In its capacity as a Lender, the Servicer or
such Affiliate shall have an equal and proportionate benefit under the
provisions of this Agreement and the Loan Agreement, without preference,
priority, or distinction as among all of the Lenders; provided, during the time
that the Servicer or any Affiliate thereof is a Lender it shall be without
voting rights as a Lender for any purpose set forth in this Agreement or the
Loan Agreement unless the Servicer or such Affiliate is the only Lender at such
time. The Servicer shall notify the Agent promptly after it or any of its
Affiliates proposes to become a Lender.

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Section 8.04.  Indemnification of the Agent and other Persons Under the Loan
Agreement.

Hercules agrees to indemnify each of the Agent and each member of the Lender
Group, the Collateral Custodian (if one is appointed), the Backup Servicer (in
such capacity and in its capacity as Successor Servicer), their respective
employees, officers, directors and agents and each other Person indemnified by
Borrower under Section 11.3 of the Loan Agreement, and to reimburse each such
Person’s reasonable out-of-pocket expenses under Section 11.3 of the Loan
Agreement, as if Hercules were a signatory thereto. This Section 8.04 shall
survive the termination of this Agreement.

ARTICLE IX  

SERVICER DEFAULT

Section 9.01.  Servicer Default.

       (a)  The occurrence of any of the following events shall constitute a
“Servicer Default”:

                           (1)  any failure by the Servicer to make any payment,
transfer or deposit or to give instructions or notice to the Borrower, the Agent
or any member of the Lender Group as required by this Agreement, or to deliver
any Servicer Report or other report required hereunder on or before the date
such payment, transfer, deposit, instruction of notice or report is required to
be made or given, as the case may be, under the terms of this Agreement;

                           (2)  any failure on the part of the Servicer duly to
observe or perform in any material respect any of the other covenants or
agreements on the part of the Servicer contained in any Loan Document to which
it is a party;

                           (3)  any breach on the part of the Servicer of any
representation or warranty contained in any Loan Document to which it is a party
that has a material adverse affect on the interests of any of the parties hereto
or thereto or any member of the Lender Group;

                           (4)  a Bankruptcy Event shall occur with respect to
the Servicer;

                           (5)  so long as the Servicer or the Originator is an
Affiliate of the Borrower, any “event of default” by the Servicer or the
Originator occurs under any of the Loan Documents;

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                           (6)  so long as Originator or any Affiliate is the
Servicer, if Hercules fails to comply with any of the financial or portfolio
covenants set forth in Section 7.01;

                           (7)  the Servicer shall fail in any material respect
to service the Transferred Loans in accordance with the Credit and Collection
Policy;

                           (8)  the Servicer agrees to or otherwise permits any
change in the Credit and Collection Policy without the prior written consent of
the Agent (which will not unreasonably be withheld);

                           (9)  any financial or asset information reasonably
requested by the Agent as provided herein is not provided as requested within
five Business Days of the receipt by the Servicer of such request;

                          (10)  the rendering against the Servicer of a final
judgment, decree or order for the payment of money in excess of $500,000
(individually or in the aggregate) and the continuance of such judgment, decree
or order unsatisfied and in effect for any period of 61 or more consecutive days
without a stay of execution;

                          (11)  the failure of the Servicer to make any payment
due with respect to aggregate recourse debt or other obligations with an
aggregate principal amount exceeding $500,000 or the occurrence of any event or
condition that would permit acceleration of such recourse debt or other
obligations if such event or condition has not been waived;

                          (12)  so long as Originator or any Affiliate is the
Servicer, if any Change of Control (as defined in the Loan Agreement) with
respect to Servicer is made without the prior written consent of the Borrower
and the Agent;

                          (13)  so long as Originator or any Affiliate is the
Servicer, if the Servicer shall fail to maintain its status as a business
development company or as a registered investment company under the 1940 Act; or

                          (14)  so long as Originator or any Affiliate is the
Servicer, if any change in the management of the Servicer (whether by
resignation, termination, disability, death or lack of day to day management)
relating to any of the individuals that are the Chief Executive Officer, Chief
Legal Officer, Chief Financial Officer, Technology Segment Head, Life Sciences
Head, or Corporate Controller of Servicer as of the Closing Date, or any failure
by any of the aforementioned Persons to provide active and material
participation in the Servicer’s daily activities including, but not limited to,
general management, underwriting, and the credit approval process and credit
monitoring activities, which no later than 90 days after the occurrence of any
event specified above is not (x) cured by the Servicer hiring a reputable,
experienced individual satisfactory to the Agent to replace the Person who is no
longer actively participating in the management of the Servicer or (y) waived in
writing by the Agent.

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       (b)  Upon the occurrence of (i) an Event of Default, or (ii) any event,
condition or circumstance shall occur or exist as shall have a Material Adverse
Effect on the Servicer, the Agent, by notice in writing to the Servicer (with a
copy to the Backup Servicer and the Collateral Custodian, if one has been
appointed) may, in addition to whatever rights such Person may have at law or in
equity to damages, including injunctive relief and specific performance, on
thirty days’ notice, terminate all the rights and obligations of the Servicer
under this Agreement and in and to the Transferred Loans and the proceeds
thereof, as servicer under this Agreement.  Within a commercially reasonable
time following receipt by the Servicer of such written notice, all authority and
power of the Servicer under this Agreement, whether with respect to the
Transferred Loans or otherwise, shall, subject to Section 9.02, pass to and be
vested in a successor servicer, and the successor servicer is hereby authorized
and empowered to execute and deliver, on behalf of the Servicer, as
attorney-in-fact or otherwise, any and all documents and other instruments and
do or cause to be done all other acts or things necessary or appropriate to
effect the purposes of such notice of termination, including, but not limited
to, the transfer and endorsement or assignment of the Transferred Loans and
related documents.  The Servicer agrees to cooperate with the successor servicer
in effecting the termination of the Servicer’s responsibilities and rights
hereunder, including, without limitation, the transfer to the successor servicer
for administration by it of all amounts which shall at the time have been or are
thereafter received with respect to the Purchased Assets.

Section 9.02.  Appointment of Successor.

       (a)  On and after the date the Servicer receives a notice of termination
pursuant to Section 9.01 hereof, or the Agent receives the resignation of the
Servicer evidenced by an Opinion of Counsel, then the Backup Servicer shall
automatically succeed and assume all obligations of the Servicer hereunder, and
all authority and power of the Servicer under this Agreement shall pass to and
be vested in the Backup Servicer.  As compensation therefor, the Backup Servicer
shall be entitled to the Servicing Fee and the Successor Engagement Fee in
addition to reimbursement of expenses incurred by the Backup Servicer in
connection with the transition of the servicing obligations (“Transition
Costs”); provided, however, in no event shall such Transition Costs exceed
$50,000.00 in the aggregate.  In the event that there is no Backup Servicer or
the Backup Servicer is unable to assume such obligations on such date, the Agent
shall submit to Hercules the name of a proposed successor servicer (the
“Successor Servicer”).  Hercules shall have the right to reject one proposed
Successor Servicer within two (2) Business Days of the Agent’s submission and,
upon such rejection Hercules shall have no further consent rights with respect
to the appointment of any Successor Servicer.  If Hercules shall not have
rejected such proposed Successor Servicer within such two (2) Business Day
period, the Agent shall, as promptly as possible, appoint such Successor
Servicer as servicer hereunder so long as such proposed Successor Servicer is
acceptable to the Lender Group.  The Successor Servicer shall accept its
appointment by a written assumption in a form acceptable to the Agent.  In the
event that a Successor Servicer has not accepted its appointment at the time
when the Servicer ceases to act as Servicer, the Agent shall petition a court of
competent jurisdiction to appoint any established financial institution, having
a net worth of not less than United States $50,000,000 and whose regular
business includes the servicing of assets similar to the Transferred Loans, as
the Successor Servicer hereunder.

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       (b)  Upon its appointment, the Backup Servicer or the Successor Servicer,
as applicable, shall be the successor in all respects to the Servicer with
respect to servicing functions under this Agreement and shall be subject to all
the responsibilities, duties and liabilities relating thereto placed on the
Servicer by the terms and provisions hereof, and all references in this
Agreement to the Servicer shall be deemed to refer to the Backup Servicer or the
Successor Servicer, as applicable; provided, however, that the Backup Servicer
or Successor Servicer, as applicable, shall have (i) no liability with respect
to any action performed by the terminated Servicer prior to the date that the
Backup Servicer or Successor Servicer, as applicable, becomes the successor to
the Servicer or any claim of a third party based on any alleged action or
inaction of the terminated Servicer, (ii) no obligation to perform any advancing
obligations, if any, of the Servicer unless it elects to in its sole discretion,
(iii) no obligation to pay any taxes required to be paid by the Servicer
(provided that the Backup Servicer or Successor Servicer, as applicable, shall
pay any income taxes for which it is liable), (iv) no obligation to pay any of
the fees and expenses of any other party to the transactions contemplated
hereby, and (v) no liability or obligation with respect to any indemnification
obligations of any prior Servicer, including the original Servicer.  The
indemnification obligations of the Backup Servicer or the Successor Servicer, as
applicable, upon becoming a successor servicer, are expressly limited to those
instances of negligence or willful misconduct of the Backup Servicer or
Successor Servicer, as applicable.

       (c)  All authority and power granted to the Servicer under this Agreement
shall automatically cease and terminate upon termination of this Agreement and
shall pass to and be vested in the Borrower and, without limitation, the
Borrower is hereby authorized and empowered to execute and deliver, on behalf of
the Servicer, as attorney-in-fact or otherwise, all documents and other
instruments, and to do and accomplish all other acts or things necessary or
appropriate to effect the purposes of such transfer of servicing rights.  The
Servicer agrees to cooperate with the Borrower in effecting the termination of
the responsibilities and rights of the Servicer to conduct servicing of the
Transferred Loans.

       (d)  Upon the Backup Servicer receiving notice that it is required to
serve as the Servicer hereunder pursuant to the foregoing provisions of this
Section 9.02, the Backup Servicer will promptly begin the transition to its role
as Servicer.  Notwithstanding the foregoing, the Backup Servicer may, in its
discretion, appoint, or petition a court of competent jurisdiction to appoint,
any established servicing institution as the successor to the Servicer hereunder
in the assumption of all or any part of the responsibilities, duties or
liabilities of the Servicer hereunder.  As compensation, any Successor Servicer
so appointed shall be entitled to receive the Servicing Fee, together with any
other servicing compensation in the form of assumption fees, late payment
charges or otherwise as provided herein that accrued prior thereto, as well as
Transition Costs.  In the event the Backup Servicer is required to solicit bids
as provided herein, the Backup Servicer shall solicit, by public announcement,
bids from banks meeting the qualifications set forth in this Section 9.02.  Such
public announcement shall specify that the Successor Servicer shall be entitled
to the full amount of the Servicing Fee as servicing compensation, together with
any other servicing compensation in the form of assumption fees, late payment
charges or otherwise as provided herein that accrued prior thereto, in addition
to Transition Costs.  Within 30 days after any such public announcement, the
Backup Servicer shall negotiate and effect the sale, transfer and assignment of
the servicing rights and responsibilities hereunder to the qualified party
submitting the highest qualifying bid.  The Backup Servicer shall deduct from
any sum received by the Backup Servicer from the successor to the Servicer in
respect of such sale, transfer and assignment all costs and expenses of any
public announcement and of any sale, transfer and assignment of the servicing
rights and responsibilities hereunder.  After such deductions, the remainder of
such sum shall be paid by the Backup Servicer to the Servicer at the time of
such sale, transfer and assignment to the Servicer’s successor.  The Backup
Servicer and such successor shall take such action, consistent with this
Agreement, as shall be necessary to effectuate any such succession.  No
appointment of a successor to the Servicer hereunder shall be effective until
written notice of such proposed appointment shall have been provided by the
Backup Servicer to the Agent and the Agent shall have consented thereto.  The
Backup Servicer shall not resign as servicer until a Successor Servicer has been
appointed and accepted such appointment.  Notwithstanding anything to the
contrary contained herein, in no event shall Lyon Financial or the Agent, in any
capacity, be liable for any Servicing Fee or for any differential in the amount
of the Servicing Fee paid hereunder and the amount necessary to induce any
Successor Servicer under this Agreement and the transactions set forth or
provided for by this Agreement.

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If Lyon Financial becomes the Successor Servicer, Lyon Financial shall be
required to service the Transferred Loans in accordance with the Obligor Loan
Documents and Accepted Servicing Practices.

Notwithstanding anything contained in this Agreement to the contrary, Lyon
Financial as successor Servicer, and any other successor servicer, is authorized
to accept and rely on all of the accounting, records (including computer
records) and work of the prior Servicer relating to the Transferred Loans
(collectively, the “Predecessor Servicer Work Product”) without any audit or
other examination thereof, except where, in the exercise of reasonable care,
such audit or examination would be advisable, and Lyon Financial shall have no
duty, responsibility, obligation or liability for the acts and omissions of the
prior Servicer.  If any error, inaccuracy, omission or incorrect or non-standard
practice or procedure (collectively, “Errors”) exist in any Predecessor Servicer
Work Product and such Errors make it materially more difficult to service or
should cause or materially contribute to Lyon Financial making or continuing any
Errors (collectively, “Continued Errors”), Lyon Financial shall have no duty,
responsibility, obligation or liability to perform servicing or for such
Continued Errors; provided, however, that Lyon Financial agrees to use
commercially reasonable efforts to prevent further Continued Errors.  In the
event that Lyon Financial becomes aware of Errors or Continued Errors, Lyon
Financial shall, with the prior consent of the Agent, use its best efforts to
reconstruct and reconcile such data as is commercially reasonable to correct
such Errors and Continued Errors and to prevent future Continued Errors.  Lyon
Financial shall be entitled to recover its costs thereby expended to the extent
of funds available therefor pursuant to the provision of Section 2.3(b) of the
Loan Agreement.  

The Servicer agrees to cooperate and use its best efforts in effecting the
transition of the responsibilities and rights of servicing of the Obligor Loan
Documents, including, without limitation, the transfer to the Backup Servicer as
successor Servicer for the administration by it of all cash amounts that shall
at the time be held by Servicer for deposit, or have been deposited by the
Servicer, or thereafter received with respect to the Obligor Loan Documents and
the delivery to the Backup Servicer as successor Servicer in an orderly and
timely fashion of all files and records with respect to the Obligor Loan
Documents and a computer tape in readable form (consistent with the Loan Tape)
containing all information necessary to enable the Backup Servicer as successor
Servicer to service the Contracts.  In addition, the Servicer agrees to
cooperate and use its best efforts in providing at the Servicer’s expense the
Backup Servicer, as successor Servicer, with reasonable access (including at the
premises of the Servicer) to Servicer’s employees, and any and all of the books,
records (in electronic or other form) or other information reasonably requested
by it to enable the Backup Servicer, as successor Servicer, to assume the
servicing functions hereunder and to maintain a list of key servicing personnel
and contact information.

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Backup Servicer as successor Servicer is authorized and empowered to execute and
deliver, on behalf of Servicer as Servicer, as attorney-in-fact or otherwise,
any and all documents and other instruments, and to do so or accomplish all
other acts or things necessary or appropriate to effect the purposes of such
notice of termination or to perform the duties of the Servicer as
Servicer.  Servicer will provide Backup Servicer, as successor Servicer, with a
Power of Attorney stating such.

Section 9.03.  Waiver of Defaults.

The Agent may waive any events permitting removal of the Servicer as servicer
pursuant to Section 9.01. Upon any waiver of a past default, such default shall
cease to exist and any Servicer Default arising therefrom shall be deemed to
have been remedied for every purpose of this Agreement. No such waiver shall
extend to any subsequent or other default or impair any right consequent thereto
except to the extent expressly so waived.

Section 9.04.  Accounting Upon Termination of Servicer.

Upon termination of the Servicer under this Article IX, the Servicer shall, at
its own expense:

       (a)  deliver to its successor or, if none shall yet have been appointed,
to the Agent, any Collections received and not yet deposited in the Cash
Management Account;

       (b)  deliver to its successor or, if none shall yet have been appointed,
to the Agent or, if a Collateral Custodian has been appointed, the Collateral
Custodian, all Loan Files and related documents and statements held by it
hereunder and a copy of the Loan Tape;

       (c)  deliver to its successor, the Agent, and the Borrower a full
accounting of all funds, including a statement showing the Scheduled Payments
with respect to the Transferred Loans collected by it and a statement of monies
held in trust by it for payments or charges with respect to the Transferred
Loans; and

       (d)  execute and deliver such instruments and perform all acts reasonably
requested in order to effect the orderly and efficient transfer of servicing of
the Transferred Loans to its successor and to more fully and definitively vest
in such successor all rights, powers, duties, responsibilities, obligations and
liabilities of the Servicer under this Agreement.

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ARTICLE X  

TERMINATION

Section 10.01.  Termination.  This Agreement shall terminate upon either:  (A)
the later of (i) the termination of the Loan Agreement and the satisfaction and
discharge of all Obligations due and owing in accordance with the provisions
thereof, or (ii) the disposition of all funds with respect to the last
Transferred Loan and the remittance of all funds due hereunder and the payment
of all amounts due and payable, including, in both cases, without limitation,
indemnification payments payable pursuant to any Loan Document to the Agent, the
Lender Group, the Borrower, the Servicer, the Collateral Custodian (if one has
been appointed) and the Backup Servicer, written notice of the occurrence of
either of which shall be provided to the Agent by the Servicer; or (B) the
mutual written consent of the Servicer, the Borrower and the Agent.

ARTICLE XI  

MISCELLANEOUS PROVISIONS

Section 11.01.  Amendment.

This Agreement may be amended from time to time by the written agreement of the
Servicer, the Originator, the Collateral Custodian (if one has been appointed),
the Backup Servicer, the Agent and the Borrower.

Section 11.02.  Duration of Agreement.

This Agreement shall continue in existence and effect until terminated as herein
provided.

Section 11.03.  GOVERNING LAW; JURISDICTION.

THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK.  EACH OF THE PARTIES TO THIS AGREEMENT HEREBY AGREES TO THE
JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF
NEW YORK AND ANY APPELLATE COURT HAVING JURISDICTION TO REVIEW THE JUDGMENTS
THEREOF. EACH OF THE PARTIES HEREBY WAIVES ANY OBJECTION BASED ON FORUM NON
CONVENIENS AND ANY OBJECTION TO VENUE OF ANY ACTION INSTITUTED HEREUNDER IN ANY
OF THE AFOREMENTIONED COURTS AND CONSENTS TO THE GRANTING OF SUCH LEGAL OR
EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY SUCH COURT.

Section 11.04.  Notices.

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All demands, notices and communications hereunder shall be in writing and shall
be deemed to have been duly given if (i) delivered personally, mailed by
overnight mail, certified mail or registered mail, postage prepaid, or (ii)
transmitted by telecopy, upon telephone confirmation of receipt thereof, as
follows: (A) in the case of the Borrower, to Hercules Funding II LLC, 400
Hamilton Avenue, Suite 310, Palo Alto, California 94301, Attention: Chief
Executive Officer and Chief Financial Officer, telecopy number 650-473-9194,
with a copy to Hercules Funding II LLC, 400 Hamilton Avenue, Suite 310, Palo
Alto, California 94301, Attention: Chief Legal Officer, telecopy number:
650-473-9194 or such other addresses or telecopy or telephone numbers as may
hereafter be furnished to the Agent and the other parties hereto in writing by
the Borrower; (B) in the case of the Originator, to Hercules Technology Growth
Capital, Inc., 400 Hamilton Avenue, Suite 310, Palo Alto, California 94301,
Attention: Chief Executive Officer and Chief Financial Officer, telecopy number
650-473-9194, with a copy to Hercules Technology Growth Capital, Inc., 400
Hamilton Avenue, Suite 310, Palo Alto, California 94301, Attention: Chief Legal
Officer, telecopy number 650-473-9194, or such other addresses or telecopy or
telephone numbers as may hereafter be furnished to the Agent and the other
parties hereto in writing by the Originator, (C) in the case of the Servicer, to
Hercules Technology Growth Capital, Inc., 400 Hamilton Avenue, Suite 310, Palo
Alto, California 94301, Attention: Chief Executive Officer and Chief Financial
Officer, telecopy number 650-473-9194, with a copy to Hercules Technology Growth
Capital, Inc., 400 Hamilton Avenue, Suite 310, Palo Alto, California 94301,
Attention: Chief Legal Officer, telecopy number 650-473-9194, or such other
addresses or telecopy or telephone numbers as may hereafter be furnished to the
Agent and the other parties hereto in writing by the Servicer; (D) in the case
of the Collateral Custodian (if one has been appointed), to such address as may
be specified in its Collateral Custodian Agreement or such other addresses or
telecopy or telephone numbers as may hereafter be furnished to the Agent and the
other parties hereto in writing by the Collateral Custodian; (E) in the case of
the Backup Servicer to Lyon Financial Services, Inc., d/b/a U.S. Bank Portfolio
Services, 1310 Madrid, Suite 103, Marshall MN 56258, Attention:  Joseph Andries,
Ref:  Hercules Funding II LLC, phone: (507) 532-7129, fax: (507) 537-5201, or
such other addresses or telecopy or telephone numbers as may hereafter be
furnished to the Agent and the other parties hereto in writing by the Backup
Servicer; (F) in the case of the Agent, to Wells Fargo Foothill, LLC, 14241
Dallas Parkway, Suite 1300, Dallas, Texas  75244, Attention: Loan Portfolio
Manager – Hercules Technology, phone: (972) 851-9111, fax:  972-387-5775
(provided, that in the case of delivery of any Underlying Notes or other Obligor
Loan Documents to Agent, copies shall be sent to such addressee and all
originals shall be sent to Wells Fargo Foothill, LLC, 14241 Dallas Parkway,
Suite 1300, Dallas, Texas  75244, Attention: Loan Documentation - Hercules
Technology, phone: (972) 851-9111, fax:  972-387-5775), with a copy to McDermott
Will & Emery LLP, 3150 Porter Drive, Palo Alto, California  94304, Attention:
Dick M. Okada, Esq, phone: (650) 813-5175, fax: (650) 813-5100 or such other
addresses or telecopy or telephone numbers as may hereafter be furnished to the
other parties hereto in writing by the Agent; any such notices shall be deemed
to be effective with respect to any party hereto upon the receipt of such notice
or telephone confirmation thereof by such party.

Section 11.05.  Severability of Provisions.

If any one or more of the covenants, agreements, provisions or terms of this
Agreement shall be held invalid for any reason whatsoever, then such covenants,
agreements, provisions or terms shall be deemed severable from the remaining
covenants, agreements, provisions or terms of this Agreement and shall in no way
affect the validity or enforceability of the other covenants, agreements,
provisions or terms of this Agreement.

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Section 11.06.  No Partnership.

Nothing herein contained shall be deemed or construed to create any partnership
or joint venture between the parties hereto.

Section 11.07.  Counterparts.

This Agreement may be executed in one or more counterparts and by the different
parties hereto on separate counterparts (including by fax or other electronic
means), each of which, when so executed, shall be deemed to be an original and
such counterparts, together, shall constitute one and the same Agreement.

Section 11.08.  Successors and Assigns.

This Agreement shall inure to the benefit of and be binding upon the Servicer,
the Originator, the Borrower, the Agent, the Borrower, and their respective
successors and permitted assigns.

Section 11.09.  Headings.

The headings of the various Sections of this Agreement have been inserted for
convenience of reference only and shall not be deemed to be part of this
Agreement.

Section 11.10.  Non-Petition Agreement.

Notwithstanding any prior termination of any Loan Document, the Originator, the
Servicer, the Collateral Custodian (if one has been appointed), and the Backup
Servicer each severally and not jointly covenants that it shall not, prior to
the date which is one year and one day, or, if longer, the applicable preference
period then in effect, after the termination of this Agreement pursuant to
Section 10.01, acquiesce, petition or otherwise, directly or indirectly, invoke
or cause the Borrower to invoke the process of any governmental authority for
the purpose of commencing or sustaining a case against the Borrower under any
Bankruptcy Law or appointing a receiver, liquidator, assignee, trustee,
custodian, sequestrator or other similar official of the Borrower or any
substantial part of their respective property or ordering the winding up or
liquidation of the affairs of the Borrower.

Section 11.11.  Due Diligence.

The Originator acknowledges that the Agent and the Lender Group may advance
Borrowings and may enter into transactions based solely upon the information
provided by the Originator to the Agent and the Lender Group in the Loan
Schedule and the representations, warranties and covenants contained herein, and
that the Agent, at its option, has the right prior to such advance of any
Borrowing therein to conduct a partial or complete due diligence review on some
or all of the Transferred Loans securing such Borrowing, including, without
limitation, re-generating the information used to originate each such
Transferred Loan.  The Agent may underwrite such Transferred Loans itself or
engage a mutually agreed upon third party underwriter to perform such
underwriting.  The Originator agrees to cooperate with the Agent and any third
party underwriter in connection with such underwriting, including, but not
limited to, providing the Agent and any third party underwriter with access to
any and all documents, records, agreements, instruments or information relating
to such Transferred Loans in the possession, or under the control, of the
Servicer.  The Originator also shall make available to the Agent a knowledgeable
financial or accounting officer for the purpose of answering questions
respecting the Loan Files and the Transferred Loans. The Agent agrees (on behalf
of itself and its Affiliates, directors, officers, employees and
representatives) to use reasonable precaution to keep confidential, in
accordance with its customary procedures for handling confidential information
and in accordance with safe and sound practices, and not to disclose to any
third party, any non-public information supplied to it or otherwise obtained by
it hereunder with respect to the Originator or any of its Affiliates; provided,
however, that nothing herein shall prohibit the disclosure of any such
information to the extent required by statute, rule, regulation or judicial
process; provided, further that, unless specifically prohibited by applicable
law or court order, the Agent shall, prior to disclosure thereof, notify the
Originator of any request for disclosure of any such non-public
information.  The Agent further agrees not to use any such non-public
information for any purpose unrelated to this Agreement and that the Agent shall
not disclose such non public information to any third party underwriter without
obtaining a written agreement from such third party underwriter to comply with
the confidentiality provisions of this Section 11.11.

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Section 11.12.  No Reliance.

Each of the Originator and the Borrower hereby acknowledges that it has not
relied on the Agent or any member of the Lender Group or any of their officers,
directors, employees, agents and “control persons” as such term is used under
the Securities Act and under the Exchange Act, for any tax, accounting, legal or
other professional advice in connection with the transactions contemplated by
the Loan Documents, that each of the Originator and the Borrower has retained
and been advised by such tax, accounting, legal and other professionals as it
has deemed necessary in connection with the transactions contemplated by the
Loan Documents and that neither the Agent nor any member of the Lender Group
makes any representation or warranty, and that neither the Agent nor any member
of the Lender Group shall have any liability with respect to, the tax,
accounting or legal treatment or implications relating to the transactions
contemplated by the Loan Documents.

Section 11.13.  Conflicts.

Notwithstanding anything contained in the Loan Documents to the contrary, (a) in
the event of the conflict between the terms of this Agreement and the Loan
Agreement, the terms of the Loan Agreement shall control, and (b) in the event
of the conflict between the terms of this Agreement and any other Loan Document
(other than the Loan Agreement), the terms of this Agreement shall control.

Section 11.14.  No Agency.

Nothing contained herein or in the Loan Documents shall be construed to create
an agency or fiduciary relationship between the Agent, any member of the Lender
Group or any of their Affiliates and the Borrower, the Originator or the
Servicer.  None of the Agent, any

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member of the Lender Group, or any of their Affiliates shall be liable for any
acts or actions affected in connection with any sale of the Loans by the
Borrower, the Originator or the Servicer.

[Remainder of Page Intentionally Left Blank]

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IN WITNESS WHEREOF, the parties hereto have caused their names to be signed by
their respective officers thereunto duly authorized, as of the day and year
first above written, to this Agreement.

HERCULES FUNDING II LLC, as Borrower

By:                                             ___               
Name:                                                         
Title:                                                         

HERCULES TECHNOLOGY GROWTH CAPITAL, INC., as Originator and Servicer

By:                    ___                                        
Name:                                                          
Title:                                                         

LYON FINANCIAL SERVICES, INC., d/b/a U.S. BANK PORTFOLIO SERVICES, as Backup
Servicer

By: __                                                                        
Name:                                                          
Title:                                                         

WELLS FARGO FOOTHILL, LLC, as Agent

By:                            __                                  
Name:                                                          
Title: