Exhibit 10.4.2


 


SECOND AMENDED AND RESTATED COMMERCIAL REVOLVING



LOAN AND SECURITY AGREEMENT


 


THIS IS THE SECOND AMENDED
AND RESTATED COMMERCIAL REVOLVING LOAN AND SECURITY AGREEMENT made this ___ day of December, 2016 by and among


 


	BANKWELL BANK	 
	a Connecticut banking corporation	 
	with a place of business at	 
	208 Elm Street	 
	New Canaan, Connecticut 06840	(“Lender”)
	 	 
	and	 
	 	 
	SACHEM CAPITAL PARTNERS, LLC	 
	a Connecticut limited liability company	 
	with a place of business at	 
	23 Laurel Street	 
	Branford, Connecticut 06405	(“Existing Borrower”)
	 	 
	SACHEM CAPITAL CORP.	 
	(formerly known as HML Capital Corp.)	 
	a New York corporation with a principal place of business at	 
	23 Laurel Street	 
	Branford, Connecticut 06405	(“SCC” or “Borrower”)


 


WHEREAS, on December
18, 2014, Lender extended credit to Existing Borrower in the original principal amount of up to $5,000,000.00 (the “Loan”)
pursuant to the terms of a certain Commercial Revolving Loan and Security Agreement, dated as of December 18, 2014; as modified
by Modification to Revolving Loan and Security Agreement, dated December 30, 2015, as further modified by an Amended and Restated
Commercial Revolving Loan and Security Agreement, dated March 15, 2016 (as the same may be, amended and/or restated from time to
time, the “Existing Loan Agreement”); and


 


WHEREAS, to evidence
and/or secure the Loan, the following documents, among others, were executed and delivered to the Lender by the Existing
Borrower (collectively, the “Loan Documents”):


 


(a)          the
Existing Loan Agreement;


 


(b)          a
certain Amended and Restated Revolving Note;


 


(c)          a
certain Unlimited Guaranty dated as of December 18, 2014 from the Guarantors in favor of the Lender guarantying the Loan as reaffirmed
and amended by Reaffirmation and Amendment to Guaranty Agreement of even date herewith (as the same may have been, or may be, amended
and/or restated from time to time, the “Guaranty”); and


 




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(d)          All
other agreements, instruments, or documents executed in connection with the Loan and modification thereof;


 


WHEREAS, SCC, a
corporation formed and currently controlled by Jeffrey C. Villano (“JCV”) and John L. Villano (“JLV”)
has filed with the U.S. Securities and Exchange Commission (the “SEC”) a registration statement pursuant to
the Securities Act of 1933, as amended, on Form S-11, designated as SEC File No. 333-214323 (the “Registration Statement”)
registering the sale of up to approximately $18 million of its common shares, par value $0.001 per share (the “Common
Shares”) in connection with an initial public offering (the “IPO”);


 


WHEREAS, Existing
Borrower and SCC (under its original corporate name, HML Capital Corp.) have entered into an Exchange Agreement, dated October
27, 2016, pursuant to which Existing Borrower has agreed to transfer all of its assets to SCC in exchange for (i) such number of
Common Shares as shall be set forth in an Underwriting Agreement to be entered into by SCC and the representative of the several
underwriters of the IPO (the “Exchange Shares”) and (ii) the assumption by SCC of all of the liabilities of
Existing Borrower including, without limitation, Existing Borrower’s obligations under the Existing Loan Agreement (the “Exchange”);


 


WHEREAS, the consummation
of the Exchange and the IPO are mutually interdependent;


 


WHEREAS, as soon
as reasonably practical after the consummation of the IPO, Existing Borrower will liquidate and distribute the Exchange Shares
to its Members, pro rata in accordance with their positive capital account balances in full liquidation of Existing Borrower,


 


WHEREAS, as soon
as reasonably practicable after the liquidation of Existing Borrower, JJV, LLC (“JJV”), the Manager of Existing
Borrower, will distribute the Exchange Shares it receives in the liquidation of Existing Borrower to its members in full liquidation
of JJV;


 


WHEREAS, following
the consummation of the Exchange and the IPO, (i) the Common Shares will be listed on will trade on either the NYSE MKT or NASDAQ
Capital Market stock exchange; (ii) SCC will be subject to the reporting requirements of the Securities Exchange Act of 1934, as
amended and (iii) SCC intends to operate and qualify as a Real Estate Investment Trust (“REIT”) for federal and state
income tax purposes;


 


WHEREAS, the Existing
Borrower and Borrower hereby acknowledge and affirm all Indebtedness incurred under the Loan Documents and all other Indebtedness,
obligations and liabilities of the Existing Borrower and Borrower to the Lender, of every kind and description, direct or indirect,
absolute or contingent, primary or secondary, due or to become due, now existing or hereafter arising (all the foregoing, whether
now existing or hereafter arising, are collectively referred to as the “Obligations”); and


 


WHEREAS, the outstanding
principal balance of the Loan as of the date hereof is Eight Million Five Hundred Twenty Five Thousand and 00/100 Dollars ($8,525,000.00);
and


 




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WHEREAS, the Lender
has agreed to consent to the Exchange and the IPO and, in connection therewith, Existing Borrower and Borrower have requested and
Lender has agreed to further amend the Loan Documents, and to modify certain terms of the Loan, all as more fully set forth herein
below.


 


NOW, THEREFORE,
THE PARTIES HERETO DO HEREBY AGREE THAT UPON THE EFFECTIVE DATE (as defined below) THE FOLLOWING TERMS SHALL APPLY (reference being
hereby made to Appendix I appended hereto for the definition of certain capitalized terms used herein):


 


Section 1.             Loan;
Interest; Guaranties; Security Interests; Financing Statements; Collateral; Subordinations.


 


1.1         The
Loan.  Subject to all the terms and conditions of this Agreement:


 


(A)         Revolving
Credit.


 


(i)           Lender
will from time to time, at the request of Borrower, and provided that all of the conditions precedent set forth in Subsection (iii)
below shall have been met by Borrower at the time of such request, be obligated to make advances to Borrower (an “Advance”
or “Advances”), which may be repaid in whole or in part at any time without penalty and re-advanced from time
to time, and which Advances shall bear interest at the rate set forth in Section 1.3, provided that the aggregate amount of all
such outstanding Advances under the Revolving Credit shall not (except in the sole and absolute discretion of Lender) at any time
exceed the lesser of (x) Eligible Notes Receivable as more particularly set forth herein (the “Asset Base”)
or (y) the amount of $15,000,000.00 (the “Maximum Availability”) (the lesser amount of the Asset Base and the
Maximum Availability (hereinafter referred to as the “Availability”).  The Revolving Credit shall
be evidenced by the Revolving Note, as attached hereto as Schedule 1.1(A)(i), delivered to Lender in form and substance
acceptable to Lender (together with any note, which, from time to time, extends, amends, supplements, modifies, renews or substitutes
such note (the “Revolving Note”).)  On the Maturity Date or upon any Event of Default, Lender’s
obligations to make such Advances shall automatically terminate and all such Advances, together with accrued and unpaid interest
thereon and expenses related thereto, shall become immediately due and payable in full.


 


(ii)          Upon
each request for an Advance, but not less frequently than monthly, within ten (10) Business Days after the conclusion of each calendar
month, Borrower shall complete and provide to Lender the Borrowing Base Certificate substantially in the form attached hereto as
Schedule 1.1(A)(ii) or otherwise acceptable to Lender (the “Borrowing Base Certificate”).  Unless
Lender shall dispute the information contained in Borrower’s most recent Borrowing Base Certificate in the Lender’s
sole and absolute discretion, the Availability shall be that set forth in such most recent Borrowing Base Certificate.  If
the Borrowing Base Certificate shall not have been provided for the current month, within ten (10) Business Days after the same
is due, the Availability under the Revolving Credit shall be zero.  The Borrower shall promptly take into account and
adjust the Borrowing Base Certificate as a result of the occurrence of any event which causes any previously Eligible Note Receivable
to be ineligible or which might be reasonably expected to affect the amount or collectability thereof, including without limitation
any off-sets or counterclaims.  In the event any Borrowing Base Certificate shall show Advances in excess of the Availability,
such excess shall be paid to Lender contemporaneously with the delivering of such Borrowing Base Certificate to Lender.


 




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(iii)         Lender’s
obligation to make any Advance under the Revolving Credit shall be subject to the following conditions precedent on the date on
which Lender makes such Advance:


 


(a)          with
respect to the all Advances, Borrower shall have received and provided to Lender such approvals, opinions, consents or documents
as Lender may reasonably request, including, without limitation: satisfactory appraisals and other financial information used in
its underwriting by Borrower; evidence satisfactory to Lender that, on the Closing Date, the Lender shall have a perfected first-priority
lien in all of the collateral subject to no other liens; assignments of Eligible Notes Receivable and Eligible Mortgages for which
the Advance is for; executed copies of all required loan documents; a business plan acceptable to Lender in form and substance;
satisfactory review of background investigation reports with respect to owners and management; certification of compliance with
financial ratios; and


 


(b)          Lender
shall be named loss payee and additional insured on all applicable insurance policies;


 


(c)          such
Advance, when added to all outstanding Advances, shall be within the Availability;


 


(d)          Lender
shall have elected, in its sole and absolute discretion, to make such Advance; and


 


(e)          the
following statements shall be true, and each request for an Advance under the Revolving Credit shall be deemed to be a representation
and warranty by Borrower to the effect that, at and as of the date of such request:


 


(i)          the
representations and warranties contained in the Loan Documents are true and correct in all material respects on and as of the date
of such request as though made on and as of such date; and


 


(ii)         no
Event of Default has occurred and/or is continuing or would result from such Advance.


 


(B)          Eligibility.  Advances
shall not be considered for eligibility by Lender unless the underlying loan (the “Mortgage Loan”), which is
represented by the Eligible Note Receivable and secured by an Eligible Mortgage and which the Advance is intended to finance, meets
the following general minimum requirements:


 


(i)           The
maturity date of the Eligible Note Receivable evidencing a Mortgage Loan shall not extend beyond the date that is more than thirty
six (36) months from the closing of such loan; provided, however, the Lender, in its sole and absolute discretion, can approve
up to one (1) thirty six month extension thereof;


 




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(ii)          The
Mortgage Loan is secured by a first mortgage lien on real property that is not the primary residence of the Maker (the “Mortgaged
Property”);


 


(iii)         For
Mortgage Loans in excess of $100,000.00, the minimum middle credit scores from TransUnion, Experian and Equifax for the Maker and
the guarantors of Maker’s obligations (the “Mortgage Loan Guarantors”) shall be:


 


(a)           625
for an Eligible Note Receivable with a loan-to-value ratio of 50% or below; or


 


(b)           660
for an Eligible Note Receivable with a loan-to-value ratio of greater than 50% but less than 75%;


 


(iv)         after
taking into account the original principal amount of the Mortgage Loan in question, not more than Four Hundred Fifty Thousand and
00/100 ($450,000.00) Dollars in principal amount in the aggregate shall be outstanding to the Maker or shall be guaranteed by the
Mortgage Loan Guarantors;


 


(v)          an
Advance (subject to the Advance rate set forth in subsection (vii) below) on any Eligible Note Receivable shall not exceed Two
Hundred Fifty Thousand and 00/100 ($250,000.00) Dollars unless waived in writing by Lender;


 


(vi)         The
Mortgaged Property shall be located in the states of Connecticut, New York, Massachusetts, New Jersey or Rhode Island;


 


(vii)        the
maximum Advance for any Eligible Note Receivable shall be (x) up to seventy five (75%) percent of any Eligible Note Receivable,
which Eligible Note Receivable represents a maximum loan-to-value ratio advanced by Borrower to the Maker of no greater than fifty
(50%) percent based upon the “as is” fair market value of the Mortgaged Property; (y) up to sixty (60%) percent of
any Eligible Note Receivable which Eligible Note Receivable represents a maximum loan-to-value ratio advanced by Borrower to the
Maker of between fifty one (51%) percent and seventy five (75%) percent of the appraised “as is” fair market value
of the Mortgaged Property; and (z) up to fifty (50%) percent of any Eligible Note Receivable for a construction loan which Eligible
Note Receivable represents a maximum loan-to-value ratio advanced by Borrower to its underlying borrower of no greater than fifty
(50%) percent of the “as is” fair market value of the Mortgaged Property;


 


(viii)       a
Mortgage Loan, evidenced by an Eligible Note Receivable and secured by an Eligible Mortgage, shall not be more than sixty (60)
days past due for interest unless the Mortgaged Property is under a binding contract of sale in which case the Mortgage Loan shall
not be past due for payments in excess of ninety (90) days;


 




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(ix)         the
Mortgaged Property securing a Mortgage Loan having an original principal amount of $325,000.00 or more shall be appraised by a
qualified independent third party appraiser, approved by Lender, within (12) months of a request for an Advance thereon.  The
Mortgaged Property securing a Mortgage Loan having an original principal amount of less than $325,000.00 shall require documentation
of value acceptable to Lender including, but not limited to, current municipal assessment or comparable sales data from sources
acceptable to Lender.


 


(C)          Ineligible
Notes.  If any Mortgage Loan does not meet the Eligibility requirements set forth in Section 1.1(B) hereinabove,
the Borrower may request an exception by Lender by submitting a request for an Advance in form and detail required by Lender, together
with a collateral description, valuation and borrower credit history in form and substance acceptable to Lender.  Lender
shall respond to said request within 48 hours of receiving all information required by Lender.  If such request is not
acted upon by Lender within said 48 hour period such request shall be deemed denied by Lender.


 


1.2         Loan.  It
is specifically contemplated by the parties to this Agreement that the lending relationship evidenced hereby may, in Lender’s
discretion, involve financial accommodations of various types to Borrower, including, but not limited to, term loans, time loans,
demand loans, over loans under the Revolving Credit, and the like, in addition to any and all loans and/or Advances previously
made by Lender to Borrower and in addition to the Revolving Credit.  Consequently, the parties intend that this Agreement
shall govern any and all financial accommodations now or hereafter extended by Lender to Borrower and all other liabilities of
the Borrower to the Lender of any kind or nature including, without limitation, fees, charges, indemnities and penalties.  In
extension of the foregoing, all loans and Advances now or hereafter made by Lender to or on behalf of Borrower pursuant to this
Agreement and/or any of the documents executed in connection herewith, or otherwise, whether or not evidenced by notes, and all
liabilities of the Borrower to the Lender (primary, secondary, direct, indirect, absolute, contingent, sole, joint or several,
whether similar or dissimilar or related or unrelated) whether previously incurred, now existing or hereafter arising, including,
without limitation under hedging contracts, guarantees or other form of surety now or hereafter provided by Borrower in favor of
Lender, whether pursuant to this Agreement or any of the Loan Documents or otherwise, any renewals or extensions thereof, to the
extent the same are outstanding from time to time, are herein collectively called the “Loan”.


 


1.3         Interest.


 


(A)         Revolving
Credit Loan.  All amounts outstanding from time to time under the Revolving Credit shall bear interest at the
greater of (i) a variable rate which at all times is three (3.0%) percentage points per annum above the Prime Rate, said rate
to change when and as said Prime Rate changes or (ii) 6.25% per annum.


 


(B)          Prime
Rate.  The Prime Rate is an annual rate of interest as published in the Wall Street Journal/Eastern Edition in its
Money Rates table from time to time and otherwise defined in the Revolving Note.  Lender may make loans to other borrowers
above, at or below its announced Prime Rate.


 




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(C)          Payment.  Interest
on the Loan shall be payable by Borrower monthly on the first (1st) day of each calendar month for interest accrued during the
preceding month on the Loan at the rate or rates of interest applicable during said preceding month.  Interest shall
be computed using a per diem rate which shall be equal to the product of (a) a fraction, the numerator of which shall be the rate
of interest calculated in accordance with Section 1.3(A) above and the denominator of which shall be three hundred sixty (360),
and (b) the actual number of days elapsed.  Any interest not paid as aforesaid may, in Lender’s sole discretion,
accrue and be added to the principal and continue to bear interest at the interest rate being borne by such principal.


 


1.4         Repayment


 


(A)        The
entire unpaid principal balance and all accrued and unpaid interest together with all late charges and other costs and expenses
accrued thereunder shall be due and payable on the Maturity Date.  In the event the Borrower elects to extend the Maturity
Date, as set forth in the Note, the Borrower shall then be required to make monthly payments of principal plus interest based upon
a straight-line amortization of the principal balance upon such election over a period of up to thirty six (36) months.  The
Note shall contain a provision authorizing the Lender to automatically debit from the commercial checking account Borrower shall
maintain with Lender, the monthly payments required under the Note.


 


(B)         Any
payment, or part thereof, received by the Lender more than ten (10) Business Days after its due date shall be subject to a late
charge of 5% of the total amount of such late payment to defray the expenses incident to handling such delinquent payment.


 


(C)         Interest
after the Maturity Date or upon an Event of Default shall be at a default interest rate equal to eighteen percent (18%) per annum
from the date of default on the outstanding Loan amount until repaid.


 


(D)         If
at any time the aggregate amount of Advances outstanding exceeds the Availability (an “Overadvance”), then Borrower
shall immediately prepay the Loan in an amount sufficient to eliminate the excess, unless Lender has consented in writing to such
Overadvance, in which event the Overadvance shall be temporarily permitted on such terms and conditions as Lender in its sole discretion
may deem appropriate, including, without limitation, the payment of additional fees or interest, or both, and consent to any Overadvance
on one occasion shall not be deemed to be consent on any other occasion.


 


1.5         Guaranties.


 


The Guarantors have executed
and delivered to Lender their Guaranty Agreements (collectively, the “Guaranties”) guaranteeing to Lender the
payment of the Loan.


 




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1.6         Security
Interests.  


 


(A)         Security
Interest in Collateral.  As security for the Obligations, including without limitation, payment of the Loan and the
performance by Borrower of its obligations under this Agreement and the other Loan Documents, Borrower hereby mortgages, pledges
and assigns to Lender, and gives and grants to Lender, a security interest in all of its personal property and fixtures, including,
without limitation, all right, title and interest in and to the items and types of property, described or referred to below, whether
now owned or hereafter acquired, and the Proceeds and products thereof (all of which property is herein collectively called the
“Collateral”) which security interest is and shall remain first and prior and which Collateral shall remain
free and clear of all mortgages, pledges, security interests, liens and other encumbrances and restrictions on the transfer thereof.


 


		(i)	Accounts;



		(ii)	Certificated Securities;



		(iii)	Chattel Paper;



		(iv)	Software and all rights with respect thereto, including without limitation, all licenses, options,
warranties, service contracts, program services, test rights, maintenance rights, support rights, improvement rights, renewal rights
and indemnifications, and any substitutions, replacements, additions or model conversions of any of the foregoing;



		(iv)	Contracts;



		(v)	Deposit Accounts;



		(vi)	Documents;



		(vii)	Equipment;



		(ix)	Financial Assets;



		(x)	Fixtures;



		(xi)	General Intangibles;



		(xii)	Goods;



		(xiii)	Instruments;



		(xiv)	Inventory;



		(xv)	Investment Property;



		(xvi)	Money (of every jurisdiction whatsoever);



		(xvii)	Letters of credit;



		(xviii)	Payment Intangibles;



		(xix)	Security Accounts;



		(xx)	Supporting Obligations;



		(xxi)	Uncertificated Securities;



		(xxii)	To the extent not included in the foregoing, all other personal property of any kind or description;
and



		(xxiii)	Eligible Notes Receivable.



 




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together with books, records, writings, data
bases, information and other property relating to, used and useful in connection with, or evidencing, embodying, incorporating
or referring to any of the foregoing, and all Proceeds, products, offspring, rents, issues, profits and returns of and from any
of the foregoing; provided that to the extent that the provisions of any lease or license of Computer Hardware and Software or
Intellectual Property expressly prohibit (which prohibition is enforceable under applicable law) any assignment thereof, and the
grant of a security interest therein, Lender will not enforce its security interest in Borrower’s rights under such lease
or license (other than in respect to the Proceeds thereof) until the earlier of termination of such prohibition, it being understood
that upon request of Lender, Borrower will in good faith use commercially reasonable efforts to obtain consent for the creation
of a security interest in favor of Lender (and to Lender’s enforcement of such security interest in favor of Lender) in Borrower’s
rights under such lease or license.


 


Unless specified otherwise in this Agreement,
all terms in this Section 1.6(A) are as defined under the Code (as defined herein).


 


(B)         Other
Collateral.


 


(i)          Commercial
Tort Claims.  Borrower shall promptly notify Lender in writing upon incurring or otherwise obtaining a Commercial
Tort Claim against any third party and, upon request of Lender, promptly enter into an amendment to this Agreement and do such
other acts or things deemed appropriate by Lender to give Lender a security interest in any such Commercial Tort Claim.


 


(ii)         Other
Collateral.  Borrower shall promptly notify Lender in writing upon acquiring or otherwise obtaining any Collateral
after the date hereof consisting of Deposit Accounts, Investment Property, Letter-of-Credit Rights or Electronic Chattel Paper
and, upon the request of Lender, promptly execute such other documents, and do such other acts or things deemed appropriate by
Lender to deliver to Lender a perfected security interest with respect to such Collateral; promptly notify Lender in writing upon
acquiring or otherwise obtaining any Collateral after the date hereof consisting of Documents or Instruments and, upon the request
of Lender, will promptly execute such other documents, and do such other acts or things deemed appropriate by Lender to deliver
to Lender a perfected security interest of such Documents which are negotiable and Instruments and, with respect to non-negotiable
Documents, to have such non-negotiable Documents issued in the name of Lender; and with respect to Collateral in the possession
of a third party, other than Certificated Securities and Goods covered by a Document, obtain an acknowledgement from the third
party that it is holding the Collateral for the benefit of Lender.


 


Notwithstanding the foregoing,
the parties agree that Lender’s security interest hereunder shall not extend to any Hazardous Substance or devices utilized
primarily for the storage of Hazardous Substances.


 




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1.7         Lien
Perfection; Further Assurances. Borrower specifically authorizes Lender to file such UCC-1 financing statements as are required
by the Code and such other instruments, assignments or documents as are necessary to perfect Lender’s lien upon any of the
Collateral and to take such other action as may be required to perfect or to continue the perfection of Lender’s lien upon
the Collateral.  Unless prohibited by applicable law, Borrower hereby authorizes Lender to file any such financing statements,
including, without limitation, financing statements that indicate the Collateral (i) as “all assets of the Borrower”
or words of similar effect, or (ii) as being of an equal or lesser scope, or with greater or lesser detail, than as set forth in
Section 1.6, on the Borrower’s behalf.  The Borrower also hereby ratifies its authorization for Lender to have
filed in any jurisdiction any like financing statements or amendments thereto if filed prior to the date hereof.  The
parties agree that a photographic or other reproduction of this Agreement shall be sufficient as a financing statement and may
be filed in any appropriate office in lieu thereof.  At Lender’s request, Borrower shall also promptly execute
or cause to be executed and shall deliver to Lender any and all assignments, documents, instruments and agreements deemed necessary
by Lender to give effect to or to carry out the terms or intent of the Loan Documents.


 


(A)         Other
Actions.  Further to insure the attachment, perfection and first priority of, and the ability of the Lender to enforce
the Lender’s security interest in the Collateral, Borrower agrees, in each case and at Borrower’s expense, to take
the following action with respect to the following Collateral and without limitation on Borrower’s other obligations contained
in this Agreement:


 


(i)           Promissory
Note and Tangible Chattel Paper.  Upon Borrower holding or acquiring any promissory notes, tangible chattel paper,
or mortgages, Borrower shall forthwith endorse, assign and deliver the same to the Lender, as Collateral for the Loan, accompanied
by such instruments of transfer or assignment duly executed in blank as the Lender may from time to time specify.


 


(ii)          Deposit
Accounts.  For each deposit account that Borrower at any time opens or maintains, Borrower shall, at the Lender’s
request and option, pursuant to an agreement in form and substance satisfactory to the Lender, either (a) cause the depository
bank to agree to comply, without further consent of Borrower, at any time with instructions from the Lender to such depository
bank directing the disposition of funds from time to time credited to such deposit account, or (b) arrange for the Lender to become
the customer of the depository bank with respect to the deposit account, with Borrower being permitted, only with the consent of
the Lender, to exercise rights to withdraw funds from such deposit account.  The Lender agrees with Borrower that the
Lender shall not give any such instructions or withhold any withdrawal rights from Borrower, unless a Default or Event of Default
has occurred and is continuing.


 




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(iii)         Investment
Property.  If Borrower shall at any time hold or acquire any Certificated Securities, Borrower shall forthwith endorse,
assign and deliver the same to the Lender, accompanied by such instruments of transfer or assignment duly executed in blank as
the Lender may from time to time specify.  If Borrower shall at any time hold or acquire any Uncertificated Securities
directly by the issuer thereof, Borrower shall immediately notify the Lender thereof and, at the Lender’s request and option,
pursuant to an agreement in form and substance satisfactory to the Lender, either (a) cause the issuer to agree to comply, without
further consent of Borrower or such nominee, at any time with instructions from the Lender as to such Uncertificated Securities,
or (b) arrange for the Lender to become the registered owner of the Uncertificated Securities.  If any Certificated Securities
or Uncertificated Securities or other Investment Property now or hereafter acquired by Borrower are held by Borrower or their nominee
through a securities intermediary or commodity intermediary, Borrower shall immediately notify the Lender thereof and, at the Lender’s
request and option, pursuant to an agreement in form and substance satisfactory to the Lender, either (i) cause such securities
intermediary or (as the case may be) commodity intermediary to agree to comply, in each case without further consent of Borrower
or such nominee, at any time, with entitlement orders or other instructions from the Lender to such securities intermediary as
to such Certificated Securities or Uncertificated Securities or other Investment Property, or (as the case may be) to apply any
value distributed on account of any commodity contract as directed by the Lender to such commodity intermediary, or (ii) in the
case of Financial Assets or other Investment Property held through a securities intermediary, arrange for the Lender to become
the entitlement holder with respect to such Investment Property, with Borrower being permitted, only with the consent of the Lender,
to exercise rights to withdraw or otherwise deal with such investment property.  The Lender agrees with Borrower that
the Lender shall not give any such entitlement orders or instructions or directions to any such issuer, securities intermediary
or commodity intermediary, and shall not withhold its consent to the exercise of any withdrawal or dealing rights by Borrower,
unless a Default or Event of Default has occurred and is continuing, or after giving effect to any such investment and withdrawal
rights not otherwise permitted by this Agreement, would occur.  The provisions of this paragraph shall not apply to any
Financial Assets credited to a securities account for which the Lender is the securities intermediary.


 


(iv)         Collateral
in the Possession of a Bailee.  If any Collateral is at any time in the possession of a bailee, Borrower shall promptly
notify the Lender thereof and, at the Lender’s request and option, shall promptly obtain an acknowledgement from the bailee,
in form and substance satisfactory to the Lender, that the bailee holds such Collateral for the benefit of the Lender and such
bailee’s agreement to comply without further consent of Borrower, at any time with instructions of the Lender as to such
Collateral.  The Lender agrees with Borrower that the Lender shall not give any such instructions unless a Default or
Event of Default has occurred and is continuing or would occur after taking into account any action by Borrower with respect to
the bailee.


 


(v)          Electronic
Chattel Paper and Transferable Records.  If Borrower at any time holds or acquires an interest in any Electronic
Chattel Paper or any “transferable record”, as that term is defined in Section 201 of the Federal Electronic Signatures
in Global and National Commerce Act (the “Electronic Signatures Act”), or in Section 16 of the Uniform Electronic
Transactions Act (“UETA”) as in effect in any relevant jurisdiction, Borrower shall promptly notify the Lender
thereof and, at the request and option of the Lender, shall take such action as the Lender may reasonably request to vest in the
Lender control, under Section 9-105 of the Code, of such Electronic Chattel Paper or control under Section 201 of the Electronic
Signatures Act or, as the case may be, Section 16 of UETA, as so in effect in such jurisdiction, of such transferable record.  The
Lender agrees with Borrower that the Lender will arrange, pursuant to procedures satisfactory to the Lender and so long as such
procedures will not result in the Lender’s loss of control, for Borrower to make alterations to the Electronic Chattel Paper
or transferable record permitted under said Section 9-105 or, as the case may be, Section 201 of the Electronic Signatures Act
or Section 16 of the UETA for a party in control to make without loss of control, unless an Event of Default has occurred or would
occur after taking into account any action by Borrower with respect to such Electronic Chattel Paper or transferable record.


 




    	 	11	 



     


    

 


(vi)         Letter-of-Credit
Rights.  If Borrower is at any time a beneficiary of any Letter of Credit Rights now or hereafter, Borrower shall
promptly notify the Lender thereof and, at the request and option of the Lender, Borrower shall, pursuant to an agreement in form
and substance satisfactory to the Lender, either (a) arrange for the issuer and any confirmer or other nominated person of such
Letter of Credit Rights to consent to an assignment to the Lender of the Proceeds of the letter of credit evidencing the Letter
of Credit Rights or (b) arrange for the Lender to become the transferee beneficiary of the Letter of Credit Rights.


 


(vii)        Commercial
Tort Claims.  If Borrower shall, now or at any time hereafter, hold or acquire a Commercial Tort Claim, Borrower
shall immediately notify the Lender in a writing signed by Borrower of the particulars thereof and grant to the Lender in such
writing a security interest therein and in the Proceeds thereof, with such writing to be in form and substance satisfactory to
the Lender, and do such other acts or things deemed appropriated by Lender to give Lender a security interest in any such Commercial
Tort Claim.


 


(viii)       Other
Actions as to any and all Collateral. Borrower further agrees, upon request of the Lender and at the Lender’s option,
to take any and all other action as the Lender may determine to be necessary or useful for the attachment, perfection and first
priority of, and the ability of the Lender to enforce, the Lender’s security interest in any and all of the Collateral, including,
without limitation (a) executing, delivering and, where appropriate, filing financing statements and amendments relating thereto
under the Code, to the extent, if any, that any of Borrower’s signature thereon is required therefor, (b) causing the Lender’s
name to be noted as secured party on any certificate of title for a titled good if such notation is a condition to attachment,
perfection or priority of, or ability of the Lender to enforce, the Lender’s security interest in such Collateral, (c) complying
with any provision of any statute, regulation or treaty of the United States as to any Collateral if compliance with such provision
is a condition to attachment, perfection or priority of, or ability of the Lender to enforce, the Lender’s security interest
in such Collateral, (d) obtaining governmental and other third party waivers, consents and approvals in form and substance satisfactory
to the Lender, including, without limitation, any consent of any licensor, lessor or other Person obligated on the Collateral,
(e) obtaining waivers from mortgagees and landlords in form and substance satisfactory to the Lender and (f) taking all actions
under any earlier versions of the Code or under any other law, as reasonably determined by the Lender to be applicable in any relevant
Uniform Commercial Code or other jurisdiction, including any foreign jurisdiction.


 


(B)          Lender’s
Obligations and Duties.  Anything herein to the contrary notwithstanding, Borrower shall remain obligated and liable
under each contract or agreement comprised in the Collateral to be observed or performed by Borrower thereunder.  The
Lender shall not have any obligation or liability under any such contract or agreement by reason of or arising out of this Agreement
or the receipt by the Lender of any payment relating to any of the Collateral, nor shall the Lender be obligated in any manner
to perform any of the obligations of Borrower under or pursuant to any such contract or agreement, to make inquiry as to the nature
or sufficiency of any payment received by the Lender in respect of the Collateral or as to the sufficiency of any performance by
any party under any such contract or agreement, to present or file any claim, to take any action to enforce any performance or
to collect the payment of any amounts which may have been assigned to the Lender or to which the Lender may be entitled at any
time or times.  The Lender’s sole duty with respect to the custody, safe keeping and physical preservation of the
Collateral in its possession, under Section 9-207 of the Code or otherwise, shall be to deal with such Collateral in the same manner
as the Lender deals with similar property for its own account.


 




    	 	12	 



     


    

 


1.8         Subordination.  Each
Guarantor is simultaneously herewith executing and delivering to Lender a debt subordination agreement (collectively, the “Subordinations”)
whereby each such party is subordinating to the Loan any and all Indebtedness of Borrower to such Guarantor for borrowed money.  Lender
hereby agrees that Borrower may make regularly scheduled payments of interest only on Subordinated Debt provided (i) no Default
or Event of Default shall have occurred and (ii) no Event of Default will be caused by the making of such payment.


 


1.9         Manner
of Funding.   Within two (2) Business Days after Lender’s receipt of such Request for Advance in the
form attached hereto, Lender shall provide such funding as is so requested.


 


1.10       Operating
Account.   The Borrower shall maintain all its operating accounts with Lender pursuant to the terms in the Note.


 


Section 2.             Representations,
Warranties and Covenants.


 


Borrower represents and
warrants to and covenant with Lender as of the date hereof, and as of the date of each Request for Advance submitted by Borrower,
except as set forth on Schedule 2 attached hereto:


 


Representations and
Warranties:


 


2.1         Organization,
Charter, Laws and Capitalization.


 


(A)         Borrower
is duly organized and validly existing corporation under the laws of the State of New York and is qualified and in good standing
in the states in which it does business; and


 


(B)          The
execution, delivery and performance of this Agreement are within Borrower’s powers, have been duly authorized, are not in
contravention of any law or any terms of Borrower’s certificate of incorporation or bylaws or other organization documents
or any agreement or undertaking to which Borrower is a party or by which it is bound; and


 


(C)          Borrower
owns no stock, membership interests or partnership interests of any other entity; and


 




    	 	13	 



     


    

 


(D)         All
of Borrower’s issued and outstanding capital stock is validly issued, non-assessable and fully paid; and  


 


(E)          The
Financial Statements (as defined in Section 2.6 below) presented by Borrower to Lender are true, complete and correct and fairly
present the financial condition of Borrower as of the date of such statements and the results of its operations for the period
then ended and there has been no material adverse change to Borrower’s financial condition since the date of such Financial
Statements.


 


2.2         Collateral,
Claims, Actions, Place of Business.


 


(A)         Except
pursuant to this Agreement, no financing statement has been filed with respect to Collateral except in favor of Lender.


 


(B)          Borrower
is the absolute and undisputed owner of the Collateral, including the Eligible Notes Receivable and Eligible Mortgages.


 


(C)          The
Collateral is not, and will not be, permitted to be, in any respect, encumbered other than by the security interest contemplated
hereby (and same will be true of Collateral acquired hereafter when acquired).


 


(D)          All
Eligible Notes Receivable, Eligible Mortgages, or Instruments are bona fide and valid and no set-offs or counterclaims exist or
will exist against any of the same.


 


(E)          All
state and federal tax returns that are required to have to be filed have been properly completed and filed and all required taxes
and assessments, if any, have been paid.  No claims have been asserted by any Governmental Authority and no audits or
notices of audits are pending.  


 


(F)          Borrower’s
principal place of business is the address shown above and Borrower shall give Lender at least thirty (30) days prior written notice
of any change.


 


(G)          The
Collateral and business records pertaining to the Collateral and Loan, including those pertaining to all accounts and contract
rights, shall be kept at Borrower’s principal place of business unless otherwise directed by Lender or prior written consent
of Lender to a change of location is obtained.


 


(H)         Other
than pursuant to this Agreement, Borrower has no other Indebtedness or contingent liabilities, except for accounts payable incurred
in the ordinary course of Borrower’s business and except as disclosed in the Financial Statement referred to in Schedule
to 2.2(H) attached.


 


(I)           Borrower
is not in default of any agreement, decree, law or order to which it is a party or by which it is bound, including without limitation
those relating to the environment.


 




    	 	14	 



     


    

 


(J)           No
litigation, suits or actions are pending or threatened against Borrower.


 


(K)         Borrower
holds all necessary licenses, consents (governmental or otherwise), patents and trademarks as are necessary to enable Borrower
to conduct its business as presently conducted and as contemplated.


 


(L)          Borrower
holds sufficient property, casualty and liability insurance and all premiums have been fully paid and Lender is named as a Loss
Payee or Additional Insured on each such insurance policy.


 


(M)        Borrower
performs no work on any contracts for the United States government or any agency or subdivision thereof.


 


(N)         Borrower
is not subject to any payment or performance bonds.


 


(O)         Borrower
is in material compliance with all laws, ordinances, rules and regulations to which it is subject, including without limitation
ERISA, OSHA, all state and federal usury laws, banking laws, Environmental Laws and tax laws.


 


(P)          Neither
the Borrower nor any Affiliate of the Borrower is subject to regulation under any of the federal banking statutes, including, without
limitation, Financial Institutions Reform, Recovery and Enforcement Act of 1989, as amended and Federal Deposit Insurance Corporation
Improvement Act of 1991, as amended.


 


(Q)         The
Borrower acknowledges and agrees that Lender is not undertaking any authority or responsibility with respect to any Eligible Note
Receivable, any Eligible Mortgage and/or any other document or agreement executed and delivered in connection with the origination
and funding of a Mortgage Loan (collectively, the “Mortgage Loan Documents”) nor is Lender assuming any collection
or credit risk with respect to any Eligible Note Receivable or Eligible Mortgage or any other Collateral nor is Lender in any way
involved in the Borrower’s pricing or the underwriting with respect to any of such Mortgage Loan Documents.


 


Affirmative and Negative
Covenants.


 


2.3         Payments.  Borrower
shall:


 


(A)         pay
punctually the Loan, when due, as required by the terms of the Revolving Note;


 


(B)          pay
on demand any and all charges customarily levied or incurred by Lender;


 




    	 	15	 



     


    

 


(C)          pay
before due any and all taxes, assessments and/or charges of every kind or description levied or assessed against either Borrower
or any of its assets;


 


(D)         pay
all insurance premiums before the same are due;


 


(E)          maintain
its principal deposit and principal disbursement accounts with Lender.


 


2.4          Preservation
of Collateral.  Borrower shall:


 


(A)         preserve
the Collateral in good condition and order and not permit it to be abused or misused;


 


(B)          not
allow any Collateral to be affixed to real estate unless secured by an Eligible Mortgage;


 


(C)          take
necessary steps to preserve the liability to the Borrower of the Makers;


 


(D)         transfer
possession of and assign all instruments, documents and chattel paper, which are part of the Collateral, including without limitation
all Eligible Notes Receivable and Eligible Mortgages to Lender, immediately upon request by Lender;


 


(E)          perfect
a security interest (using a method satisfactory to Lender) in goods covered by any Instrument, Document or Chattel Paper constituting
Collateral;


 


(F)          notify
Lender of any change occurring in or to Collateral, including without limitation any Eligible Note Receivable or Eligible Mortgage,
or in any fact or circumstance warranted or represented by Borrower herein, or furnished to Lender, or if any Event of Default
occurs;


 


(G)          pay
all costs necessary to perform any act or duty required by this Agreement, including, but not limited to, attorneys’ fees,
insurance premiums, taxes and assessments;


 


(H)          maintain
sufficient property, casualty and liability insurance, as reasonably determined by Lender, and shall name Lender as Loss Payee
and/or Additional Insured on such policies of insurance;  


 


(I)           maintain
full compliance with all Environmental Laws, including without limitation the disposition of Hazardous Substances, and allow Lender
to verify such compliance at Borrower’s expense; and


 


(J)           maintain
compliance with all laws, ordinances, rules and regulations of any Governmental Authority or subdivision, including without limitation
all usury laws.


 




    	 	16	 



     


    

 


2.5         Restrictions.  Borrower
shall not:


 


(A)         suffer
to exist any liens on any Collateral;


 


(B)         merge,
consolidate or dispose of or transfer any asset except for Mortgaged Property acquired by foreclosure, deed in lieu of foreclosure
or otherwise in satisfaction of an eligible Note Receivable;


 


(C)         without
the written consent of the Lender in its sole discretion, suffer to exist any Indebtedness in excess of $100,000.00 in the aggregate
including, but not limited to, purchase money obligations except for (i) a mortgage loan from Lender in an original principal
amount not to exceed $387,500.00, the proceeds of which to be used for the purchase of property at 698 Main Street, Branford,
Connecticut and (ii) any other Indebtedness to any Affiliate with the prior written consent of Lender and further, provided all
such Indebtedness is subject to a Subordination Agreement in favor of Lender in form and substance acceptable to Lender;


 


(D)         suffer
to exist any litigation against it or any of its assets claiming an amount in excess of $50,000.00 unless either (i) Borrower’s
liability is fully covered by insurance or (ii) Borrower shall provide to Lender an opinion of independent counsel, which opinion
and counsel are in all respects acceptable to Lender, stating that any such litigation will not have a material adverse effect
on Borrower;


 


(E)          cause
to exist any Subsidiary or engage in any transactions with any Subsidiary or Affiliate except for co-funding of Mortgage Loans
to customers of Borrower or of such Subsidiary or Affiliate in the ordinary course of Borrower’s business provided no such
loans are funded with proceeds of the Loan;


 


(F)          with
respect to ERISA, engage in any “prohibited transaction”, incur any “accumulated funding deficiency”, terminate
any pension plan so as to create any lien on any asset of Borrower, or otherwise not be in full compliance;


 


(G)          guarantee
or otherwise assure any obligation of any other party including, without limitation, that of any Guarantor;


 


(H)          incur
capital expenditures (including, without limitation, capitalized leases) in excess of $100,000.00 in any fiscal year on a non-cumulative
basis;


 


(I)           declare
or pay any cash dividends in excess of Borrower’s REIT taxable income (as determined for federal income tax purposes);


 


(J)           purchase
any securities issued by, or otherwise invest in, any publicly or privately held entity except to purchase Certificates of Deposit
issued by any lending institution having a net worth of at least $50,000,000.00;


 




    	 	17	 



     


    

 


(K)         change
the nature of its business from that conducted on the date hereof;  


 


(L)          without
the consent of Lender, change in executive management, unless John Villano and Jeffrey Villano remain as senior executives with
day to day operational involvement; and


(M)         change
the form of or nature of the ownership structure of the Borrower from a REIT.


 


2.6         Financial
Statements.  Throughout the term of the Loan, the Borrower shall provide the Lender with copies of its (a) audited
annual financial statements, including balance sheet, income statement and statement of cash flow (“Financial Statements”)
within five (5) Business Days of the filing due date or filing, whichever is earlier, of its annual report on Form 10-K with the
U.S. Securities and Exchange Commission (the “SEC”), (b) quarterly unaudited Financial Statements within five
(5) Business Days of the filing due date or filing, whichever is earlier, of its Quarterly Report on Form 10-Q with the SEC, (c)
federal income tax returns within five (5) Business Days of the filing due date or filing, which is earlier, of such tax returns
with the Internal Revenue Service and (d) such other financial information as may be reasonably requested by the Lender within
thirty (30) days of its receipt of a written request from the Lender setting forth in reasonable detail the form and substance
of such information.


 


Guarantors, other than JJV,
LLC, shall submit to Lender annually their personal Financial Statements (including contingent liabilities), in form and substance
acceptable to Lender within thirty (30) days of each calendar year end.  Such individual Guarantors shall also provide
to Lender a copy of their federal tax returns within thirty (30) days of filing due dates.


 


Borrower shall also submit
the following:


 


a.            Borrowing
Base Certificate, or such other form reasonably requested by Lender, together with each Request for Advance, but no less frequently
than monthly no later than the tenth (10th) Business Day following each calendar month end.


b.            Monthly
past due report certified by Borrower for all Eligible Notes Receivable no later than the twentieth (20th) day following
each calendar month end.


 


c.            A
list, certified by the President and Chief Financial Officer of Borrower, of all Mortgage Loans held by Borrower, with such detail
as required by Lender, as of the last day of each calendar month, no later than the tenth (10th) Business Day following
each calendar month end.


 


2.7         Set-off.  In
addition to any rights now or hereafter granted under applicable law and not by way of limitation of any such rights, Lender and
any participant of any Lender is hereby authorized by Borrower and each Guarantor upon the occurrence of any Default or Event of
Default, to set off and to appropriate and to apply any and all balances held by it at any of its offices for the account of Borrower,
any Guarantor or any of its Subsidiaries (regardless of whether such balances are then due to Borrower, any Guarantor or its Subsidiaries)
and any other property at any time held or owing by that Lender or that holder to or for the credit or for the account of Borrower
or any Guarantor against and on account of the Loan being unpaid.  Borrower and each Guarantor agrees, to the fullest
extent permitted by law, that (a)  Lender or any holder may exercise its right to set off with respect to the Loan and
may sell participations in such set off to other lenders and holders and (b) any lender or holder so purchasing a participation
in the Loan made or held by other lenders or holders may exercise all rights of set-off, bankers’ lien, counterclaim or similar
rights with respect to such participation as fully as if such Lender or holder were a direct holder of Loan in the amount of such
participation.


 




    	 	18	 



     


    

 


2.8         Covenants
During Loan Term.  


 


(A)         Financial
Covenants.  Throughout the term of the Loan:


 


(i)           Borrower
shall maintain a Fixed Charge Coverage Ratio of at least 1.35 to 1.00, as of the end of each fiscal quarter of Borrower.


 


(ii)          Borrower
shall maintain a minimum Tangible Net Worth equal to the sum of (x) seventy five percent (75%) of Borrower’s shareholder’s
equity immediately following the consummation of the IPO plus (y) sixty percent (60%) percent of net cash proceeds from the sale
by the Borrower of any equity securities following the IPO.


 


(iii)         Each
of the JCV and JLV shall own not less than 500,000 Common Shares of the Borrower’s issued and outstanding capital stock.


 


(B)          Definitions.


 


(i)           Fixed
Charge Coverage Ratio:  For the applicable period, the ratio of:


 


(a)           EBITDA
minus the sum of (x) all income taxes paid in cash in such period, and (y) all unfinanced Capital Expenditures;


 


to


 


(b)          the
sum of (v) interest expense accrued for such period and paid in cash at any time by Borrower, (w) CPLTD, (x) dividends on any preferred
equity in Borrower, (y) capitalized interest on Mortgage Loans and (z) amortization on any discounts on Mortgage Loans.


 


(ii)          CPLTD:  The
current portion of long term Indebtedness paid during the applicable period, including, but not limited to, amounts required to
be paid during such period under capital leases.


 


(iii)         EBITDA:  Net
income for an accounting period before provision for payment of interest expense and federal income taxes plus depreciation and
amortization to the extent deducted from such net income during such accounting period, all as determined by GAAP.


 




    	 	19	 



     


    

 


(iv)         GAAP:  U.S.
Generally Accepted Accounting Principles and practices consistently applied from accounting period to accounting period.


 


(v)          Tangible
Net Worth:  An amount equal to the excess of (x) total assets over (y) the sum of (I) the total of all assets which would
be classified as intangible assets under GAAP, including, but not limited to, good will, trademarks, trademark applications, trade
names, service marks, patents, patent applications, licenses and franchises and (II) total liabilities as set forth on Borrower’s
balance sheet as of the last day of each fiscal quarter.


 


2.9         Inspection/Field
Examinations.  Borrower will permit Lender and any authorized representatives of Lender to visit and inspect any
of its properties or offices or the properties or offices of any of its subsidiaries, including, without limitation, all items
of Collateral and its and their books and records, including books and records relating to Accounts, Eligible Notes Receivable
and Eligible Mortgages (and to make extracts therefrom), and to discuss its and their affairs, finances and accounts with its and
their employees, all at such times during normal business hours and as often and continuously as may be requested by Lender.  Lender
may conduct such quarterly audits of Borrower’s Eligible Notes Receivable, Eligible Mortgages, Related Documents and other
documentation as Lender shall consider necessary in order to verify the entries on Borrower’s Borrowing Base Certificate.  If
no Event of Default shall exist, Lender shall not conduct more than one (1) such field examinations per year at Borrower’s
expense.


 


2.10       Application
of Proceeds.  As set forth under the terms of the Revolving Note.


 


2.11       Fees.


 


(A)         Service
Fee.  Intentionally omitted


 


(B)          Origination
Fee.  Borrower shall pay to Lender in current funds a fee in the amount of $5,000.00 as a modification fee upon the
date hereof.


 


(C)          Early
Termination Fee.  The Borrower may prepay the Loan in part or in full at any time provided, however, in the
event the Loan is refinanced with another lender, the Borrower shall pay an exit fee equal to one (1%) percent of the entire face
amount of the Revolving Note.  If the Loan shall be accelerated for any reason whatsoever, the applicable prepayment
fee in effect as of the date of such acceleration shall be paid.  All partial prepayments shall be accompanied by and
applied first to the payment of costs and expenses thereto and unpaid late charges, then to accrued and unpaid interest and the
balance on account of the unpaid principal in the inverse order of maturity.  Such partial prepayments shall not affect
Borrower’s obligation to make the regular installments required hereunder until the Loan is fully paid.


 




    	 	20	 



     


    

 


2.12       Environmental
Compliance.  


 


(A)         Borrower
will comply and will ensure that each Mortgaged Property and each Maker complies with all applicable Environmental Laws, regulations,
rules, standards, orders and agreements.  Whenever, pursuant to any such legal requirement, Borrower or any Maker is
obligated to report to any party the existence of a Spill (as such term is defined in Section 1 of Public Act 85-443), “Release”
(as defined in 42 U.S. Code 9601 et seq.), “Hazardous Waste”, “Hazardous Substance” (as defined in 42 U.S.
Code 9601 et seq.) or other environmental contamination on or emanating from any Mortgaged Property, Borrower will, simultaneously
and in writing, report the existence of such conditions to Lender at the address set forth in Section 12 hereof.


 


(B)         In
addition to any and all other liability of Borrower to Lender hereunder, Borrower shall indemnify the Lender against any loss or
damage that shall occur to Lender as a result of Borrower’s violation of any applicable federal, state, local or quasi-governmental
law, rule, regulation or ordinance.


 


(C)         In
the event that any claim shall be made against Borrower by any governmental entity in connection with the discharge of Hazardous
Substances or wastes then Borrower shall either (i) pay the claim or (ii) furnish to such governmental entity that imposed the
lien a bond, cash deposit or other security reasonably satisfactory to such governmental entity in an amount sufficient to discharge
the lien.


 


2.13        Servicing
of Eligible Notes Receivable


 


(A)         The
Borrower shall make all reasonable efforts to collect all payments called for under the terms and provisions of the Eligible Notes
Receivable, and shall follow such collection procedures as are in accordance with Accepted Servicing Practices.


 


(B)         In
the event that a default with respect to an Eligible Notes Receivable has occurred, the Borrower shall notify the Lender and, upon
receipt of a written request by the Lender specifying what action Borrower should take, the Borrower shall take such action with
respect to such Eligible Note Receivable as directed by the Lender.


 


Section 3.             Special
Representations, Warranties and Covenants re Eligible Accounts Receivable.


 


Without in any way limiting
any Representation or Warranty contained in Section 2 hereof, and without in any way limiting the pledges and security interests
granted to Lender under Section 1.5 hereof, Borrower hereby represents and warrants to and covenants with Lender, with respect
to each and every account receivable (an “Eligible Account Receivable”) and every promissory note (an “Eligible
Note Receivable”) and Eligible Mortgage securing an Eligible Note Receivable now or hereafter serving as a basis for
any Advance made by Lender to the Borrower that:


 


3.1         Eligible
Accounts Receivable.


 


(A)         Such
accounts are each evidenced by an Eligible Note Receivable executed, endorsed and delivered to Lender.


 




    	 	21	 



     


    

 


(B)          Such
accounts are not now, and will not at the time of any Advance, be subject to any offsets, claims, counterclaims, deductions, disputes
or discounts of any nature whatsoever claimed or which, under the terms of any agreement or otherwise, may be claimed by the account
debtor or accounts debtors with respect thereto, including, without limitation, any accounts where the account debtor is also a
creditor of or supplier to Borrower.


 


(C)          Such
accounts presently, and in the future at the time of any Advance, will represent undisputed, bona fide Indebtedness to Borrower
of account debtors (who are not Affiliates or Subsidiaries of Borrower) located in jurisdictions in which Borrower is qualified
to do business and is fully licensed by such jurisdiction to conduct its business.  


 


(D)          The
assignment of such accounts does not, and will not, violate any agreement with such account debtor or by which such account debtor
is bound.  


 


(E)          Borrower
is, and will be, the lawful owner of and have a good right to pledge, sell, assign, transfer and to grant a security interest in
such of the accounts as are offered by Borrower.


 


(F)          Such
accounts have not been, nor hereafter will be, pledged, sold, assigned, transferred or encumbered to any Person other than Lender.


 


(G)          Such
accounts are, or will be, owing by an underlying borrower and mortgagor who, since the date of the Eligible Note Receivable evidencing
such accounts, has not died, terminated its existence, become insolvent (which term shall include either a negative tangible net
worth or an inability to pay its debts as they mature), suffered a business failure, been subjected either voluntarily or involuntarily
to the appointment of a receiver of any part of his or its property, made an assignment for the benefit of his or its creditors,
requested creditors to stand by, or has filed or had filed against him or it a petition in bankruptcy or any other proceeding under
any bankruptcy or insolvency laws.


 


(H)         Borrower
has, and will have, access to the courts or arbitration panel or other tribunal of the state or other jurisdiction which has or
will have in personam jurisdiction over the account debtors owing on such accounts for purposes of collecting and enforcing such
accounts.


 


(I)           Borrower
is the sole owner of record and holder of the Eligible Notes Receivable and Eligible Mortgage relating to such Eligible Accounts
and has good, indefeasible and marketable title thereto, and has full right to transfer the Eligible Accounts to Lender.  There
is no impediment to the Borrower’s ability to enforce any Eligible Notes Receivable or Eligible Mortgages, including without
limitation, state laws relating to the Borrower’s qualification to do business as a precondition to the use of state courts
and state laws relating to usury.


 


(J)           Borrower
shall provide, at least monthly no later than the tenth (10th) day of each month, a revised complete listing of its
Eligible Accounts Receivable as of the end of the prior month.


 




    	 	22	 



     


    

 


3.2         Eligible
Notes Receivable.  An Eligible Note Receivable shall be a promissory note constituting a negotiable instrument made,
executed and delivered to Borrower evidencing bona fide Indebtedness owing to Borrower as a result of a Mortgage Loan made by Borrower
to the Maker of such Eligible Note Receivable:  


 


(A)         Evidences
a valid and enforceable commercial transaction and was originated and underwritten in accordance with all applicable state and
federal laws, rules and regulations (including without limitation all usury laws) and each Eligible Note Receivable and Eligible
Mortgage has been delivered in accordance with and is in compliance with all applicable state and federal laws, rules and regulations.


 


(B)         Is
the legal, valid and binding obligation of the Maker thereof enforceable in accordance with its terms.  Borrower has
reviewed all the documents relating to each Eligible Note Receivable and has made such inquiries as it deems necessary to make
and confirm the accuracy of the representations set forth herein.


 


(C)         Is
secured by a duly recorded validly perfected and enforceable first fee commercial mortgage of marketable fee simple title to premises
not subject to the lien of any past due taxes or other municipal charges and which is not occupied by the obligor on such loan
(an “Eligible Mortgage”).


 


(D)         Is
secured by an Eligible Mortgage of premises as to which:  


 


(i) there are no delinquent
taxes and no delinquent assessment liens at the time of funding.


 


(ii) the improvements thereon
are covered by (x) a fully paid, valid and existing hazard policy insuring against loss or damage by fire and hazards, acceptable
to Lender and (y) a valid and existing flood insurance policy in accordance with all applicable state and federal laws, rules and
regulations, if the premises are in a designated flood hazard area and flood insurance is available for the premises under the
National Flood Insurance Act of 1968, as amended.  All individual insurance policies contain a standard mortgagee clause
naming Borrower, Lender and their respective successors and/or assigns as their interests may appear.


 


(iii) no improvement thereon
is in violation of any applicable zoning, planning, or wetland law or regulation.


 


(iv) there is no pending
action or proceeding directly involving the compliance with any environmental law, rule or regulation.  


 


(v) nothing further remains
to be done to satisfy in full all requirements of each law, rule or regulation constituting a prerequisite to residential or other
use and enjoyment of such premises.


 




    	 	23	 



     


    

 


(vi) an ALTA mortgagee’s
title insurance policy is issued by a title insurer acceptable to Lender and qualified to do business in the State in which the
premises are located, insuring Borrower and its successors and assigns, as to the first priority lien of the Eligible Mortgage,
subject to no encumbrances, in the maximum principal amount of the Eligible Note Receivable.  Each such policy shall
also be in form and content and issued by such companies as shall be acceptable to the Lender.


 


(vii) to the best of Borrower’s
knowledge, there is no pending action or proceeding in which the compliance with any lead paint law, rule or regulation is an issue.  Nothing
further remains to be done to satisfy in full all requirements of each such law, rule or regulation that constitutes a prerequisite
to the use and enjoyment of such property.


 


(E)         Any
and all requirements of any federal, state or local law, rule and/or regulation, including, without limitation, usury, truth-in-lending,
real estate settlement procedures, consumer credit protection, equal credit opportunity, fair housing, fair lending or disclosure
laws applicable to the Eligible Notes Receivable have been complied with.  Borrower shall maintain in its possession,
available for Lender’s inspection, and shall deliver to Lender upon demand, evidence of compliance with all such requirements,
to the extent compliance requires preparation of one or more documents or writings.


 


Section 4.             Events
of Default.


 


Each of the following events
shall constitute “Event of Default”):


 


4.1         If
the Borrower shall default in the payment of any part of the Loan, including, without limitation, payments due under the Revolving
Credit, owing by it when the same shall become due and payable, whether at any stated maturity, or by declaration, acceleration
or otherwise;


 


4.2         If
at any time the information contained in any Borrowing Base Certificate shall be untrue, false or misleading or if the outstanding
balance of the Revolving Credit shall exceed the Availability shown on the Borrowing Base Certificate and the amount of such excess
is not promptly paid by Borrower within two (2) Business Days;


 


4.3         If
Borrower shall default in the performance of or compliance with any term or covenant applicable to it contained in this Agreement,
or contained in any other Loan Document, within ten (10) days after notice from Lender to Borrower;


 


4.4         If
any representation or warranty made by or on behalf of Borrower, in this Agreement or in the Schedules hereto, or in any other
Loan Document, or in connection with the transactions contemplated hereby and thereby shall prove to be false or incorrect in any
material respect;


 


4.5         The
failure to pay the Loan in full on maturity, or the failure to pay any other installment of principal and/or interest, or any other
sum due hereunder upon maturity or within ten (10) days from the date when such installment is otherwise due and payable;


 




    	 	24	 



     


    

 


4.6         The
failure to pay any tax or assessment upon any Collateral securing the Loan, on or before the date the same shall become delinquent;


 


4.7         The
occurrence of an Event of Default (as defined therein) under this Agreement or any other Loan Document (beyond any grace periods
set forth in said agreement);


 


4.8         The
filing by or against Borrower or any Guarantor of any petition, arrangement, reorganization, or the like under any insolvency or
bankruptcy law, or the adjudication of Borrower as a bankrupt (and if such filing is involuntary, the failure to have same dismissed
within ninety (90) days from the date of filing), or the making of an assignment for the benefit of creditors, or the appointment
of a receiver for any part of Borrower’s properties or the admission in writing by Borrower or any Guarantor of the liability
to pay debts as they become due;


 


4.9         Borrower’s
failure to have any lien, attachment or encumbrance which is enforced or levied against the Collateral without Lender’s consent
(other than the lien for ad valorem taxes not yet due) discharged, released and/or satisfied within thirty (30) days after its
recording;


 


4.10       The
occurrence of any of the following events:  (a) a change, without Lender’s prior written consent, in the nature
of the use of the Collateral which materially increases the possibility of a violation of any state or federal environmental law
or regulation, (b) the failure of Borrower to immediately contain, remove or mitigate any violation of environmental law or regulation,
or (c) Borrower’s failure to immediately upon request reimburse the State of Connecticut, the federal government or Lender
for any amounts expended by them with respect to any violation of environmental law or regulation;


 


4.11       The
death, incapacity, or dissolution, as is applicable, of Borrower or any Guarantor, unless a substitute Guarantor is approved by
Lender, in its sole discretion, within six (6) months of death or incapacity, or the attempted revocation or termination by any
Guarantor of any guaranty;


 


4.12       The
passage or enforcement of any federal, state, or local law or the rendition of a final decision of any court (other than a law
or decision with respect to a tax upon the general revenues of the Lender) in any way directly materially changing or materially
affecting the Loan or lessening the net income thereon in a material fashion which is not corrected or reimbursed by the Borrower;  


 


4.13       The
passage or enforcement of any federal, state, or local law, or the rendition of a final decision of any court in any way materially
impairing Lender’s ability to charge and collect the interest stated under the Loan, including without limitation, the ability
to vary the interest payable under the Loan in accordance with the terms hereof; or


 


4.14       Upon
failure to be in compliance with any loan covenant as set forth herein or any other Loan Document.


 




    	 	25	 



     


    

 


Section 5.             Remedies
on Default; Provisions re Collateral, Etc.


 


5.1         If
a Default or Event of Default shall have occurred, Lender shall have no obligation to make Advances and, in addition, may accelerate
and declare all Obligations hereunder to be immediately due and payable, and may proceed to protect and enforce its rights by suit
in equity, action at law or other appropriate proceedings, whether for the specific performance of any agreement contained herein
or in any other Loan Document, or for an injunction against a violation of any of the terms hereof or thereof, or in aid of the
exercise of any right, power or remedy granted thereby or by law, equity or otherwise.


 


5.2         Upon
the occurrence of any Event of Default the Borrower grants a royalty-free license to the Lender for all patents, service marks,
trademarks, trade names, copyrights, computer programs and other intellectual property and proprietary rights sufficient to permit
the Lender to exercise all rights granted to the Lender pursuant to this Agreement.


 


5.3         Upon
the occurrence of any Event of Default, the Lender shall have the right, to be exercised in its sole discretion to service, or
appoint a third party to service the Collateral consisting of underlying loans of Borrower.


 


5.4         Without
limitation of any rights and remedies of Lender as a secured party under the Code and any rights or remedies set forth herein or
any other Loan Documents if an Event of Default shall exist hereunder, Lender shall have all the following rights and remedies
with respect to the Collateral or any portion thereof:


 


(i)           Lender
may at any time and from time to time with or without judicial process and the aid or assistance of others, enter upon any premises
in which any of the Collateral may be located and, without resistance or interference by Borrower, take possession of the Collateral
and/or dispose of any part or all of the Collateral on any such premises; and/or require Borrower to assemble and make available
to Lender, at the expense of Borrower and/or Guarantor, any part or all of the Collateral at any place or time designated by Lender
which is reasonably convenient to the Borrower and Lender; and/or remove any part or all of the Collateral from any premises on
which any part may be located for the purpose of effecting sale or other disposition thereof; and/or sell, resell, lease, assign
and deliver, grant options for or otherwise dispose of any or all of the Collateral in its then condition or following any commercially
reasonable preparation or processing, at public or private sale or proceedings, by one or more contracts, in one or more parcels,
at the same or different times, with or without having the Collateral at the place of sale or other disposition, for cash and/or
credit, and upon any terms, at such place(s) and time(s) and to such Persons as Lender shall deem best, all without demand for
performance or any notice or advertisement whatsoever, except that unless any of the Collateral shall be perishable or is of a
type that can decline speedily in value, the Borrower shall be given five (5) Business Days’ notice of the place and time
of any public sale or of the time after which any private sale or other intended disposition is to be made, which notice Borrower
hereby agrees shall be deemed reasonable notice thereof.  If any of the Collateral is sold by Lender upon credit or for
future delivery, Lender shall not be liable for the failure of the purchaser to pay for same and in such event Lender may resell
such Collateral.  Lender may buy any part or all the Collateral at any public sale and if any part or all the Collateral
is of a type customarily sold in a recognized market or is of the type which is the subject of widely distributed standard price
quotations Lender may buy at private sale and may make payment therefor by application of all or a part of the Loan.


 




    	 	26	 



     


    

 


(ii)          Lender
may, in Lender’s discretion, apply the cash Proceeds from any sale or other disposition of the Collateral, first, to the
reasonable expenses of retaking, holding, preparing for sale, selling, leasing and otherwise disposing of such Collateral, to reasonable
appraisal, accounting and attorneys’ fees and all legal expenses, travel and other expenses which are to be paid or reimbursed
to Lender, pursuant hereto or pursuant to any other Loan Document, second, to all accrued interest, fees and charges outstanding
with respect to the Loan in such order, as Lender shall determine, third, to principal and all other outstanding portions of the
Loan in such order, as Lender shall determine, fourth, any surplus to any other secured parties having an interest in the Collateral
known to Lender in accordance with their interests, and fifth, any surplus to the Borrower; provided, however, that Borrower and
Guarantors shall remain jointly and severally liable with respect to unpaid portions of the Loan and will pay Lender on demand
any deficiency remaining together with interest thereon.


 


Notwithstanding any of
the foregoing, Borrower acknowledges that Lender is making the Loan in reliance on the totality of the Collateral and this Agreement
specifically prohibits subordinate liens thereon.  Consequently, Lender shall have no liability to marshal assets for
the benefit of any other creditor, or be subject to any restrictions with respect to the liquidation or other disposal of the Collateral.


 


(iii)         Lender
may appropriate, set-off and apply to the payment of all or any part of the Loan any and all balances, sums, property, claims,
credits, deposits, accounts, reserves, collections, drafts, notes or other items or Proceeds of the Collateral, in or coming into
the possession, custody, safekeeping or control of Lender or any Affiliate of Lender or its agents, or belonging to Borrower and
in such manner as Lender may, in its discretion determine, and the Proceeds of any such set-off shall be applied in accordance
with the provisions of the preceding Subparagraph hereof;


 


(iv)         Any
of the Proceeds of the Collateral received by Borrower after the occurrence of an Event of Default shall not be commingled with
any other of its property, but shall be segregated, held by it in trust as the exclusive property of Lender, and Borrower will
immediately deliver to Lender the identical checks, monies, or other Proceeds of Collateral received;


 


(v)          Unless
Maker is making payments directly to Lender, upon the written request of Lender made to Borrower, whether or not an Event of Default
shall have occurred, Borrower shall notify Maker that its Mortgage Loan has been assigned to Lender and that any payments on such
Mortgage Loan should be made directly to Lender.


 


Notwithstanding the foregoing,
Lender shall have the right at any time upon written notice to the Borrower to notify a Maker to make its Mortgage Loan payments
directly to Lender.


 




    	 	27	 



     


    

 


Section 6.             Cumulative
Remedies; No Waivers, Etc.


 


No right, power or remedy
granted to Lender in this Agreement or in any other Loan Document is intended to be exclusive, but each shall be cumulative and
in addition to any other rights, powers or remedies referred to in this Agreement, in any other Loan Document or otherwise available
to Lender at law or in equity; and the exercise or beginning of exercise by Lender of any one or more of such rights, powers or
remedies, shall not preclude the simultaneous or later exercise by Lender of any or all of such other rights, powers or remedies.  No
waiver by, nor any failure or delay on the part of Lender in any one or more instances to insist upon strict performance or observance
of one or more covenants or conditions hereof, or of any other Loan Document shall in any way be, or be construed to be, a waiver
of such covenant in any other instance or to prevent Lender’s rights to later require the strict performance or observance
of such covenants or conditions, or otherwise prejudice Lender’s rights, powers or remedies.


 


Section 7.             Partial
Invalidity; Waivers.


 


7.1         If
any term or provision of this Agreement or any other Loan Document or the application thereof to any Person or circumstance shall,
to any extent, be invalid or unenforceable by reason of any applicable law, the remainder of this Agreement and the other Loan
Documents, or application of such term or provision to Persons or circumstances other than those as to which it is held invalid
or unenforceable, shall not be affected thereby, and each term and provision of this Agreement and the other Loan Documents shall
be valid and enforceable to the fullest extent permitted by law.  To the full extent, however, that the provisions of
any such applicable law may be waived, they are hereby waived by Borrower and Guarantors to the end that this Agreement and the
other Loan Documents shall be deemed to be valid and binding obligations enforceable in accordance with their terms.


 


7.2         To
the extent permitted by applicable law, Borrower and Guarantors hereby waive protest, notice of protest, notice of default or dishonor,
notice of payments and non-payments, or of any default.


 


7.3         WITH
RESPECT TO ANY CONTROVERSY, ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR IN CONNECTION WITH THE TRANSACTIONS DESCRIBED
HEREIN OR CONTEMPLATED HEREBY, INCLUDING, WITHOUT LIMITATION, IN CONNECTION WITH THE LOAN, THE COLLATERAL AND/OR ANY OF THE OTHER
LOAN DOCUMENTS, BORROWER, GUARANTORS AND LENDER EACH VOLUNTARILY AND KNOWINGLY WAIVES ANY RIGHT TO OR CLAIM FOR A TRIAL BY JURY.


 




    	 	28	 



     


    

 


7.4         BORROWER
AND GUARANTORS ACKNOWLEDGE THAT THE WITHIN AGREEMENT EVIDENCES A COMMERCIAL TRANSACTION AND THAT THEY COULD, UNDER CERTAIN CIRCUMSTANCES
HAVE THE RIGHT UNDER CHAPTER 903a, AS FROM TIME TO TIME AMENDED, OF THE CONNECTICUT GENERAL STATUTES, SUBJECT TO CERTAIN LIMITATIONS,
TO NOTICE OF AND HEARING ON THE RIGHT OF THE LENDER TO OBTAIN A PREJUDGMENT REMEDY, SUCH AS ATTACHMENT, GARNISHMENT AND/OR REPLEVIN,
UPON COMMENCING ANY LITIGATION AGAINST BORROWER OR GUARANTORS.  NOTWITHSTANDING, BORROWER AND GUARANTORS HEREBY WAIVE
ALL RIGHTS TO NOTICE, JUDICIAL HEARING OR PRIOR COURT ORDER TO WHICH THEY MIGHT OTHERWISE HAVE THE RIGHT UNDER SAID CHAPTER 903a,
AS FROM TIME TO TIME AMENDED, OR UNDER ANY OTHER STATE OR FEDERAL STATUTE OR CONSTITUTION IN CONNECTION WITH THE OBTAINING BY THE
LENDER OF ANY PREJUDGMENT REMEDY BY REASON OF THIS COMMERCIAL REVOLVING LOAN AND SECURITY AGREEMENT, OR BY REASON OF BORROWER’S
OR GUARANTORS’ OBLIGATIONS OR ANY RENEWALS OR EXTENSIONS OF THE SAME.  BORROWER AND GUARANTORS ALSO WAIVE ANY AND
ALL OBJECTION WHICH THEY MIGHT OTHERWISE ASSERT, NOW OR IN THE FUTURE, TO THE EXERCISE OR USE BY LENDER OF ANY RIGHT OF SETOFF,
REPOSSESSION OR SELF HELP AS MAY PRESENTLY EXIST UNDER STATUTE OR COMMON LAW.


 


BORROWER AND GUARANTORS
SPECIFICALLY WAIVE AND RELINQUISH ANY CLAIM TO INCIDENTAL AND/OR CONSEQUENTIAL DAMAGES ARISING IN ANY WAY OUT OF AN ALLEGED BREACH
HEREOF BY LENDER AND AGREE THAT DAMAGES FOR WHICH LENDER MAY BE LIABLE, IF ANY, SHALL BE LIMITED TO THOSE DIRECT DAMAGES PROVEN
TO HAVE BEEN SUFFERED BY BORROWER OR GUARANTORS ARISING DIRECTLY FROM SUCH BREACH.


 


Section 8.             Expenses/Indemnity.


 


Borrower agrees to:


 


8.1         Pay
or reimburse Lender on demand for any and all means, in each case whether prior to or after the commencement of any Insolvency
Proceeding, all Lender Expenses, including payment upon the Closing hereof of any portion of such charges, costs and fees for which
an invoice shall be rendered;


 




    	 	29	 



     


    

 


8.2         Indemnify
and save Lender and each Lender Affiliate, as well as any assignee of the Lender and their respective directors, officers,
employees, agents and attorneys (each an “Indemnitee”) harmless
from, and pay or reimburse Lender for, claims, losses, liabilities (including negligence, tort and strict liability), damages,
demands, judgments, settlements, suits, and all legal proceedings and any and all costs and expenses in connection therewith (including
reasonable attorneys’ fees and expenses) (to the extent applicable given the circumstances, each a “Claim”)
if any, incurred by Lender relating to (i) the Revolving Note or any of the other Loan Documents; (ii) the exercise by the Lender
of any of its rights, remedies or powers hereunder, the Revolving Note or any of the other Loan Documents; (iii) any misrepresentation,
inaccuracy, or breach of any representation, warranty, covenant, or agreement contained or referred to herein or any other Document,
the security interests and liens granted pursuant to this Agreement or the other Loan Documents; (iv) the performance of any obligation
of Borrower or Guarantors in connection with the Collateral; (v) the attempted enforcement or enforcement of this Agreement or
the other Loan Documents, or the collection or attempted collection of any of the Obligations owing under any thereof, including,
without limitation, the Loan, or the realization or attempted realization upon any of the Collateral; (vii) the prosecution or
defense of any action or proceeding concerning any matter growing out of or connected with this Agreement, the other Loan Documents
or the Collateral; (viii) any Hazardous Substance at, on, in, under, or about all or any portion of any property owned, occupied
and/or operated by the Borrower or any environmental condition within, on, from, related to, or attaching to any such property;
(ix) any Release or threatened Release of any Hazardous Substance from any property owned, occupied or operated by the Borrower
or from the Borrower’s operations or other activities, including without limitation any Release by any prior owner, occupant
or operator of any such property; (x) any violation or claim of violation of any Environmental Law by the Borrower or its operations
or other activities; (xi) any other environmental condition or matter within, on, from or related to or affecting any property
owned, leased or operated by the Borrower or Borrower’s operations or other activities; (xii) any other operations or activities
of the Borrower or conditions or occurrences on the Borrower’s properties (all the foregoing under this paragraph collectively,
the “Indemnified Liabilities”) and, in addition, at Lender’s discretion, Borrower and Guarantors shall
defend (with counsel satisfactory to the Lender) Lender against those Indemnified Liabilities which the Lender shall choose Borrower
and Guarantors to defend Lender against (provided, that, it is understood and agreed that all reasonable costs and expenses of
counsel incurred by Lender in defending itself against any Indemnified Liability shall be Indemnified Liabilities for which Borrower
and Guarantors are responsible for payment under this subparagraph) provided, however, nothing contained herein shall obligate
Borrower to indemnify and hold harmless any Indemnitee with respect to any claim arising as a result of such Indemnitee’s
fraud, willful misconduct, violation of law or gross negligence.  The agreements in this section shall survive any payment
of the Loan or any other amounts payable hereunder or under any other Loan Document and/or any termination of this Agreement or
any Loan Document or the release of any Collateral.  All amounts payable under this Section shall be payable by the Borrower
and Guarantors on demand by the Lender.


 


8.3         Allow
Lender, in Lender’s discretion, to receive payment of any of the foregoing by a charge to the Revolving Note (which charge
shall thereupon become a part of the Loan) or by deduction from any account maintained by Borrower or Guarantors with Lender or
subject to Lender’s control.


 




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Section 9.             Further
Assurances; Possession of Collateral; Power of Attorney.


 


At any time and from time
to time, upon the demand of the Lender, the Borrower will, at the Borrower’s expense (i) immediately give, execute, deliver,
pledge, endorse, file, and/or record any notice, statement, financing statement, instrument, documents, chattel paper, agreement,
or other papers that may be necessary or desirable, or that the Lender may request, in order to create, preserve, perfect, or validate
any security interest granted pursuant hereto or intended to be granted hereunder or to enable the Lender to exercise or enforce
its rights hereunder or with respect to such security interest; and (ii) keep, stamp, or otherwise mark any and all documents,
instruments, chattel paper, and its books and records relating to the Collateral in such manner as the Lender may require.  The
Borrower hereby irrevocably appoints the Lender (and any of its attorneys, officers, employees or agents) as its true and lawful
agent and attorney-in-fact, said appointment being coupled with an interest with full power of substitution, in the name of the
Borrower, the Lender, or otherwise, for the sole use and benefit of the Lender in its sole discretion, but at the Borrower’s
expense, to exercise, to the extent permitted by law, in its name or in the name of the Borrower or otherwise, the powers set forth
herein, whether or not any of the Mortgage Loans are due (i) to endorse the name of the Borrower upon any instruments of payment,
freight, or express bill, bill of lading, storage, or warehouse receipt relating to the Collateral and to demand, collect, receive
payment of, settle, or adjust all or any of the Collateral; (ii) to correspond and negotiate directly with insurance carriers;
and (iii) to sign and file one or more financing statements naming the Borrower as debtor and the Lender as secured party to execute
any notice, statement, instruments, agreement, or other paper that the Lender may require to create, preserve, perfect, or validate
any security interest granted pursuant hereto or to enable the Lender to exercise or enforce its rights hereunder or with respect
to such security interest.  Neither the Lender nor its attorneys, officers, employees, or agents shall be liable for
acts, omissions, any error in judgment, or mistake in fact in its/their capacity as agent or attorney-in-fact.  This
power, being coupled with an interest is irrevocable until the Loan has been fully satisfied.  At the Lender’s
sole option, and without the Borrower’s consent, the Lender may file a carbon, photographic, or other reproduction of this
Agreement or any financing statement executed pursuant hereto as a financing statement in any jurisdiction so permitting.  The
Lender is expressly authorized to file financing statements without the Borrower’s signature.


 


Section 10.           Survival
of Agreements, Representations and Warranties, Etc.


 


All agreements, representations
and warranties contained herein or made in writing by or on behalf of Borrower or Guarantors, in connection with the transactions
contemplated hereby, shall survive the execution and delivery of this Agreement and the related documents and, to the extent applicable,
shall be deemed to be made anew by each of them each time an Advance is made, pursuant hereto or pursuant to the other Loan Documents
and shall continue until the Loan has been paid in full and this Agreement has been terminated.  All statements contained
in any certificate or other instrument delivered by or on behalf of Borrower or Guarantors, pursuant hereto or in connection with
the transactions contemplated hereby, shall be deemed representations and warranties made hereunder.


 


Section 11.           Failure
to Perform.


 


If Borrower shall fail
to observe or perform any of the covenants hereof (other than the payment of sums due under the Revolving Note), Lender may pay
amounts or incur liabilities to remedy or attempt to remedy any such failure (including, without limitation, any sums payable under
any statute relating to the environment) and all such payments made and liabilities incurred shall be for the account of Borrower,
may be paid, at Lender’s option, by the making of additional advances under the Revolving Note and, consequently, shall be
included in the Loan and all such amounts shall be repaid by Borrower on demand, together with interest thereon at the rate of
18% per annum, or may be repaid by a withdrawal from any of Borrower’s accounts maintained with Lender.  The provisions
of this Section and any such action by Lender shall not prevent any default in the observance or performance of any covenant hereof
from constituting an Event of Default hereunder.


 




    	 	31	 



     


    

 


Section 12.           Notices,
Etc.


 


All notices, requests,
consents and other communications hereunder shall be in an authenticated record and shall be deemed to be duly delivered by authenticated
electronic means or if mailed, postage prepaid, by first class registered mail, return receipt requested, or by any nationally
recognized receipted delivery or courier service:


 


(A)         if
to Lender:


 


Bankwell Bank


208 Elm Street


New Canaan, Connecticut
06840


Attn:  Commercial
Loan Department


 


with a copy to:


Murtha Cullina LLP


177 Broad Street,
16th Floor


Stamford, Connecticut 06905


Attention:  Scott
M. Gerard, Esq.


 


or at such other address as may have been furnished
in writing by Lender to Borrower; or


 


(B)         if
to Borrower or Guarantor:


 


Sachem Capital Corp.


23 Laurel Street


Branford, Connecticut 06405


 


with a copy to:


 


Morse, Zelnick, Rose &
Lander, LLP


825 Third Avenue


New York, New York 10022


Attn:  Joel Goldschmidt,
Esq.


 


or at such other address as may have been furnished
in writing by Borrower to Lender.


 


Section 13.           Amendments
and Waivers.


 


Neither this Agreement
nor any other Document nor any term hereof or thereof may be changed, waived, discharged or terminated, except by a writing signed
by all the parties hereto.


 




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Section 14.           Miscellaneous.


 


(A)         This
Agreement and each other Document granting Lender a security interest in any personal property of Borrower shall be deemed a security
agreement within the meaning of the Code.  Where any provision in this Agreement refers to action to be taken by any
Person, or which such Person is prohibited from taking, such provision shall be applicable whether such action is taken directly
or indirectly by such Person.  This Agreement and the documents contemplated hereby shall be construed and enforced in
accordance with and governed by the laws of the State of Connecticut.  Borrower and each Guarantor hereby specifically
consents to the jurisdiction of the Courts of the State of Connecticut and the Federal Courts situated in the State of Connecticut
and agree to be personally bound by the decisions of the Courts of the State of Connecticut and such Federal Courts.  To
the extent there is any inconsistency between the terms of this Agreement and any of the documents contemplated hereby, this Agreement
shall control.  All the terms of this Agreement and such other documents shall be binding upon and inure to the benefit
of and be enforceable by the respective successors and assigns of the parties hereto, whether so expressed or not, and by any other
holder or holders of the Loan or any part thereof.  The headings in this Agreement are for the purposes of reference
only and shall not limit or otherwise affect any of the terms hereof.  


 


(B)         This
Agreement is between each Lender, Borrower and Guarantors only and shall not be relied upon by any third party.  Without
limiting the foregoing, Lender shall have no liability to any party whatever (including, without limitation, Borrower or Guarantors,
or anyone conducting business with any of the foregoing) in the event Lender, for any reason and at any time, determines not to
advance sums under the Revolving Note for any reason or otherwise exercises its rights under this Agreement and/or the other documents
contemplated hereby.


 


(C)         This
Agreement may be executed in any number of counterparts, each of which when executed and delivered shall be an original but all
of which together constitute one and the same instrument.  This Agreement, to the extent signed and delivered by means
of a facsimile machine or other electronic transmission in which the actual signature is evident, shall be treated in all manner
and respects as an original agreement or instrument and shall be considered to have the same binding legal effect as if it were
the original signed version thereof delivered in person.  At the request of any party hereto, each other party hereto
or thereto shall re-execute original forms hereof and deliver them to all other parties.  No party hereto shall raise
the use of a facsimile machine or other electronic transmission in which the actual signature is evident to deliver a signature
or the fact that any signature or agreement or instrument was transmitted or communicated through the use of a facsimile machine
or other electronic transmission in which the actual signature is evident as a defense to the formation of a contract and each
party forever waives such defense.  In proving this Agreement, it shall not be necessary to produce or account for more
than one such counterpart signed by the party against which enforcement is sought.


 


Section 15.           Certain
Disclosures.


 


Attached hereto as Schedule
15 is a listing of the following information which Borrower and each Guarantor represents and warrants to be true and correct
as of the date hereof:


 


		(A)	Borrower’s shareholders and capital stock held by each;



 




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		(B)	Date of most recently prepared Financial Statements;



 


		(C)	Indebtedness owing by Borrower other than to Lender and Subordinated Debt, if any;



 


		(D)	Borrower’s Patents, Trademarks, Trade Names, Copyrights;



 


		(E)	Pending or threatened litigation involving Borrower;



 


		(F)	Borrower’s licensing agreements, governmental consents;



 


		(G)	past changes to Borrower’s name;



 


		(H)	Leases to which Borrower is a party;



 


		(I)	Federal and state tax identification numbers.



 


Section 16.           Release.


 


Upon full payment and satisfaction
of the Loan and the interest thereon and expenses incurred by Lender in connection therewith and upon termination of this Agreement
by Lender, Lender shall release and/or return all Collateral to Borrower and the parties shall thereupon automatically each be
fully, finally, and forever released and discharged from any further claim, liability or obligation in connection with the Loan
or any of them.  Notwithstanding the foregoing, in the event any payment is recovered from Lender in whole or in part,
as a result of any insolvency proceedings or otherwise, the rights, benefits and security interests of Lender under this Agreement
shall remain in full force and effect as to any and all of such recovered sums, all of which shall be a part of the Loan hereunder.


 


Section 17.           Patriot
Act.


 


Borrower certifies that,
to the best of their knowledge, neither Borrower nor any of its Subsidiaries has been designated, and is not owned or controlled,
by a “suspected terrorist” as defined in Executive Order 13224.  Borrower hereby acknowledges that Lender
seeks to comply with all applicable laws concerning money laundering and related activities.  In furtherance of those
efforts, Borrower hereby represents, warrants and agrees that:  (i) none of the cash or property that Borrower or any
of their Subsidiaries will pay or will contribute to Lender has been or shall be derived from, or related to, any activity that
is deemed criminal under United States law; and (ii) no contribution or payment by Borrower or any of its Subsidiaries to Lender,
to the extent that they are within such Borrower’s and/or its Subsidiaries’ control shall cause Lender to be in violation
of the United States Bank Secrecy Act, the United States International Money Laundering Control Act of 1986 or the United States
International Money Laundering Abatement and Anti-Terrorist Financing Act of 2001.  Borrower shall promptly notify Lender
if any of these representations ceases to be true and accurate regarding either Borrower or any of their Subsidiaries.  Borrower
agrees to provide Lender any additional information regarding Borrower or any of their Subsidiaries that Lender deems necessary
or convenient to ensure compliance with all applicable laws concerning money laundering and similar activities.  Borrower
understands and agrees that if at any time it is discovered that any of the foregoing representations are incorrect, or if otherwise
required by applicable law or regulation related to money laundering or similar activities, Lender may undertake appropriate actions
to ensure compliance with applicable law or regulation.  Borrower further understands that Lender may release confidential
information about Borrower and their Subsidiaries and, if applicable, any underlying beneficial owners, to proper authorities if
Lender, in its sole discretion, determines that it is in the best interests of Lender in light of relevant rules and regulations
under the laws set forth in Subsection (ii) above.


 




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Section 18.           Effective
Date; Consents; Releases.


 


18.1       This
Agreement shall be effective immediately upon the consummation of both the Exchange and the IPO (the “Effective Date”),
provided, however, this Agreement shall become null and void if either the Exchange or the IPO has not been consummated
on or before February 15, 2017, in which event the terms of the Amended and Restated Commercial Revolving Loan Agreement dated
March 15, 2016 (the “Existing Loan Agreement”) shall remain in full force and effect.  Borrower hereby
irrevocably assumes, as of the Effective Date, Existing Borrower’s Obligations arising under the Existing Loan Agreement,
including, but not limited to, the outstanding principal balance under the Revolving Note and all accrued but unpaid interest thereon,
subject to any rights of Existing Borrower with respect thereto.


 


18.2       As
of the Effective Date, this Agreement shall supersede the Existing Loan Agreement.


 


18.3       As
of the Effective Date, (i) Lender hereby waives any and all defaults, Events of Default and breaches of or arising under the Existing
Loan Agreement and (ii) hereby releases and forever discharges Existing Borrower, its officers, directors, members, managers, successors
and assigns (other than Borrower and Guarantors) from any and all causes of actions, actions, debts, sums of money, accounts, bonds,
bills, covenants, contracts, controversies, promises, agreements, judgments, damages, claims, demands whatsoever, in law, equity
or admiralty, which against said releasees, Lender, its successors or assigns, have, ever had or may have in the future under or
pursuant to the Loan Agreement by reason of any matter cause or things whatsoever from the beginning of time to the date hereof.


 


18.4       Lender
hereby consents to the following transactions as of the Effective Date:


 


(i)           The
IPO;


 


(ii)          The
Exchange;


 


(iii)         The
liquidation of Existing Borrower; and


 




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(iv)        The
liquidation of JJV.


 


18.5       Saturdays,
Sundays, Holidays etc.  If the last or appointed day for the taking of any action or the expiration of any right
required or granted herein shall not be a Business Day, then, such action may be taken or such right may be exercised on the next
succeeding Business Day.


 


18.6       Capitalized
Terms.  Capitalized terms used in this Agreement but not defined above shall have the meaning ascribed to such terms
in Appendix I hereto.


 


REMAINDER OF PAGE INTENTIONALLY LEFT BLANK


 


SIGNATURE PAGE FOLLOWS


 




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IN WITNESS WHEREOF, each
of the parties hereto has executed this Agreement on the day first above mentioned.


 


	 	LENDER:
	 	 
	 	BANKWELL BANK
	 	 	 
	 	By	 
	 	Name:	Lisa Choi
	 	Title:	Vice President


 


	 	BORROWER:
	 	 
	 	Sachem Capital Corp.
	 	(formerly known as HML Capital Corp.)
	 	 	 
	 	By:	 
	 	Name:	John L. Villano
	 	Title:	Co-Chief Executive Officer


 




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SCHEDULE OF SCHEDULES


 


 


	Section	 	 	 	 
	Reference	 	Schedule	 	Subject
	 	 	 	 	 
	1.1(A)(i)	 	1.1(A)(i)	 	Amended and Restated Revolving Note
	 	 	 	 	 
	1.1(A)(ii)	 	1.1(A)(ii)	 	Borrowing Base Certificate
	 	 	 	 	 
	1.9	 	1.9	 	Request for Advance Form
	 	 	 	 	 
	2	 	2	 	Exceptions to Representations, Warranties and Covenants
	 	 	 	 	 
	2.2(H)	 	2.2(H)	 	Financial Statement (Indebtedness or Liabilities)
	 	 	 	 	 
	15	 	15	 	Certain Disclosures


 




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APPENDIX I


 


As used herein, the following
terms have the following meanings:


 


Accepted Servicing
Practices:  The procedures that the Borrower follows in the servicing and administration of, and in the same
manner in which, and with the same care, skill, prudence and diligence with which the Borrower services and administers, loans
similar to the Mortgage Loans, and in all events consistent with the Mortgage Loan Documents and customary and usual standards
of practice of prudent institutional multifamily and commercial mortgage lenders and loan servicers and with a view to the maximization
of timely recovery of principal and interest on the Mortgage Loans.


 


Advance: the meaning
specified in Section 1.1(A).


 


Affiliate:  with
reference to any Person, any director, officer or employee of such Person, any corporation, association, firm or other entity in
which such Person has a direct or indirect controlling interest or by which such Person is directly or indirectly controlled or
is under direct or indirect common control with such Person.


 


Agreement: this
Second Amended and Restated Commercial Revolving Credit and Security Agreement.


 


Borrower: the meaning
specified on page 1 of this Agreement.


 


Business Day: any
day other than a Saturday, Sunday or legal holiday in which commercial banks are open for the normal transaction of business in
the State of New York.


 


Claim:  the
meaning specified in Section 8.2


 


Code:  the
Uniform Commercial Code as the same may in effect from time to time in the state of New York.


 


Collateral:  the
meaning specified in Section 1.6(A).


 


Default:  the
occurrence of any event which with the giving of notice or passage of time (other than stated grace periods), or both, might become
an Event of Default.


 


Eligible Accounts Receivable:  the
meaning specified in Section 3.


 


Eligible Mortgage(s):  the
meanings specified in Section 3.2(C).


 


Eligible Notes Receivable(s):  the
meaning specified in Section 3.


 




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Environmental Laws:  any
and all applicable foreign, Federal, state and local statutes, laws, regulations, rules, ordinances, orders, guidance, policies
or common law (whether now existing or hereafter enacted or promulgated) pertaining to the environment, of any and all Federal,
state or local governments and governmental and quasi-governmental agencies, bureaus, subdivisions, commissions or departments
which may now or hereafter have jurisdiction over Debtor and all applicable judicial and administrative and regulatory decrees,
judgments and orders, including common law rulings and determinations, relating to injury to, or the protection of, real or personal
property or human health or the environment, including, without limitation, all requirements pertaining to reporting, licensing,
permitting, investigation, remediation and removal of emissions, discharges, releases or threatened releases of Hazardous Substances,
chemicals substances, pollutants or contaminants whether solid liquid or gaseous in nature, into the environmental or relating
to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of such Hazardous Substances,
chemical substances, pollutants or contaminants.


 


Without limiting the generality
of the foregoing, the term “Environmental Laws” shall encompass each of the following statutes, and regulations promulgated
thereunder, and amendments and successors to such statutes and regulations, as may be enacted and promulgated from time to time:  Federal
Occupational Safety and Health Act (“OSHA”); the Clean Air Act (“CAA”); the Toxic Substances Control Act
(“TSCA”); the Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA”), as amended
by the Superfund Amendments and Reauthorization Act of 1986 (“SARA”); the Clean Water Act (“CWA”); the
Resource Conservation and Recovery Act, as amended by the Hazardous and Solid Waste Amendments of 1984 (“RCRA”); the
Hazardous Materials Transportation Act; and all applicable Environmental Laws of each state and municipality in which Debtor conducts
business or locates assets and all rules and regulations thereunder and amendments thereto and all similar state and local laws,
rules and regulations.


 


ERISA:  The
Employee Retirement Income Security Act of 1974.


 


Event of Default:  the
meaning specified in Section 4.


 


Governmental Authority:  any
federal, state or local governmental authority or any political subdivision of any of them and any court, agency, department, commission,
board, bureau or instrumentality of any of them which now or hereafter has jurisdiction over the parties hereto, any maker or any
Mortgaged Property.


 


Guaranties: the
meaning specified in Section 1.5.


 


Guarantors:  John
Villano, Jeffrey Villano and JJV, LLC, jointly and severally.


 


Hazardous Substance:
any chemical, compound, material, mixture or substance: (i) the presence of which requires or may hereafter require notification,
investigation, monitoring or remediation under any Environmental Law; (ii) which is or becomes defined as a “Hazardous Waste”,
“Hazardous Material” or “Hazardous Substance” or “Toxic Substance” or “Pollutant”
or “Contaminant” under any present or future applicable Federal, state or local law or under the rules and regulations
adopted or promulgated pursuant thereto, including, without limitation, the Environmental Laws; (iii) which is toxic, explosive,
corrosive, reactive, ignitable, infectious, radioactive, carcinogenic, mutagenic or otherwise hazardous and is or becomes regulated
by any Governmental Authority, agency, department, commission, board, agency or instrumentality of any foreign country, the United
States, any state of the United States, or any political division thereof to the extent any of the foregoing has or had jurisdiction
over Debtor; (iv) without limitation, which contains gasoline, diesel fuel or other petroleum products, asbestos or polychlorinated
biphenyls (“PBCs”); or (v) any other chemical, material or substance, exposure to, or disposal of, which is now or
hereafter prohibited, limited or regulated by any federal, state or local governmental body, instrumentality or agency.


 




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Indebtedness:  as
applied to a Person, (a) all items, except items of capital stock or of surplus or of general contingency reserves or of reserves
for deferred income taxes if in compliance with Section 2.3(c), which in accordance with generally accepted accounting principles
and practices would be included in determining total liabilities as shown on the liability side of a balance sheet of such person
as at the date of which indebtedness is to be determined, (b) all indebtedness secured by any mortgage, pledge, lease, lien or
conditional sale or other title retention agreement existing on any property or asset owned or held by such person subject thereto,
whether or not such indebtedness shall have been assumed, and (c) all indebtedness of others which such Person has directly or
indirectly guaranteed, endorsed, discounted or agreed (contingently or otherwise) to purchase or repurchase or otherwise acquire,
or in respect of which such Person has agreed to supply or advance funds (whether by way of loan, stock purchase, capital contribution
or otherwise) or otherwise to become liable directly or indirectly with respect thereto.


 


Indemnified Liabilities:  the
meaning specified in Section 8.2.


 


Indemnitee:  the
meaning specified in Section 8.2


 


Insolvency Proceeding:  a
proceeding under any bankruptcy, reorganization, dissolution or liquidation law or statute of any jurisdiction.


 


Interest Expense:  for
any period, all amounts accrued by Borrower, whether as interest, late charges, service fees or other charge for money borrowed
on account of or in connection with Borrower’s Indebtedness for money borrowed or with respect to which Borrower or any of
their respective properties are liable by assumption, operation of law or otherwise, including, without limitation, any leases
which are required, in accordance with generally accepted accounting principles, to be carried as a liability on Borrower’s
balance sheet.


 


Lender:  Lender
and its successors and assigns.


 


Lender Affiliate:  any
Affiliate of the Lender


 




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Lender
Expenses:  in each case whether prior to or after the commencement of any Insolvency Proceeding, all (a) costs
or expenses (including taxes, and insurance premiums) required to be paid by a Borrower or any Guarantor under any of the Loan
Documents that are paid or incurred by the Lender, (b) reasonable fees or charges paid or incurred by Lender in connection with
the Lender’s transactions with Borrower or any Guarantor under the Loan Documents, including, fees or charges for photocopying,
notarization, couriers and messengers, telecommunication, public record searches (including tax lien, litigation, and UCC searches
and including searches with the patent and trademark office, the copyright office, or the department of motor vehicles), filing,
recording, publication, appraisal (including periodic Collateral appraisals or business valuations to the extent of the fees and
charges (and up to the amount of any limitation) contained in this Agreement, real estate surveys, real estate title policies and
endorsements, and environmental audits, (c) reasonable costs and expenses incurred by Lender in the disbursement of funds to or
for the account of Borrower or any Guarantor (by wire transfer or otherwise), (d) reasonable charges paid or incurred by Lender
resulting from the dishonor of checks, (e) reasonable costs and expenses paid or incurred by the Lender to correct any default,
enforce any provision of the Loan Documents, (following the occurrence, and during the continuation, of an Event of Default) gain
possession of, maintain, handle, preserve, store, ship, sell, prepare for sale, or advertise to sell the Collateral, or any portion
thereof, irrespective of whether a sale is consummated, (f) audit fees and expenses of Lender related to audit examinations of
the books and records of Borrower to the extent of the fees and charges (and up to the amount of any limitation) contained in this
Agreement, (g) reasonable costs and expenses of third party claims or any other suit paid or incurred by the Lender in enforcing
or defending the Loan Documents or in connection with the transactions contemplated by the Loan Documents or the Lender’s
relationship with Borrower or any Guarantor, (h) Lender’s reasonable fees and expenses (including attorneys’ fees)
incurred in advising, structuring, drafting, reviewing, administering, or amending the Loan Documents, and (i) Lender’s reasonable
fees and expenses (including attorneys’ fees) incurred in terminating, enforcing (including attorneys’ fees and expenses
incurred in connection with a “workout,” a “restructuring,” or an Insolvency Proceeding (and any objection
by or against, and any claim or adversary proceeding against Lender or any Lender in connection with such Insolvency Proceeding),
or in otherwise exercising rights or remedies under the Loan Documents, or defending the Loan Documents and any interest in the
collateral, including without limitation, in connection with any action to avoid or subordinate any of the Lender’s Liens
or payment made in connection with the Loan Documents or the Collateral.


 


Loan Documents:  this
Agreement, the Revolving Note, the Guaranties, the Subordinations and all other instruments heretofore, now or hereafter executed
and delivered pursuant to this Agreement or any of the aforesaid documents.


 


Loan:  the
meaning specified in Section 1.2.


 


Maker:  the
maker of an Eligible Note Receivable.


 


Maximum Availability:
the meaning specified in Section 1.1(A)(i).


 




    	 	42	 



     


    

 


Obligations:  (a)
all loans, Advances, debts, principal, interest (including any interest that, but for the provisions of the Bankruptcy Code,
would have accrued), contingent reimbursement obligations with respect to outstanding letters of credit, premiums, liabilities
(including all amounts charged to the Loan Account pursuant hereto), obligations, fees, charges, costs, Lender Expenses (including
any interest, fees or expenses that, but for the provisions of the Bankruptcy Code, would have accrued), lease payments, guaranties,
covenants, and duties of any kind and description owing by Borrower to the Lender pursuant to or evidenced by the Loan Documents
and irrespective of whether for the payment of money, whether direct or indirect, absolute or contingent, due or to become due,
now existing or hereafter arising, and including all interest not paid when due and all Lender Expenses that Borrower is required
to pay or reimburse by the Loan Documents, by law, or otherwise.  Any reference in this Agreement or in the Loan Documents
to the Obligations shall include all amendments, changes, extensions, modifications, renewals replacements, substitutions, and
supplements, thereto and thereof, as applicable, both prior and subsequent to any Insolvency Proceeding; and (b) all present and
future Indebtedness and obligations, of any nature whatsoever, direct or indirect, absolute or contingent, matured or not, at any
time owing or to become owing by the Borrower to the Lender arising from any contract, agreement, dealings, occurrence, non-occurrence,
event and/or operation of law whereby the Borrower becomes indebted and/or obligated towards the Lender.


 


OSHA:  Occupational
Safety and Health Act.


 


Overadvance: the
meaning specified in Section 1.4(D).


 


Person:  a
corporation, an association, a partnership, an organization, a limited liability company, a business, an individual or a government
or political subdivision thereof or any governmental agency.


 


Request for Advance
Form:  the meaning specified in 1.9.


 


Revolving Credit:  the
credit facility described in Section 1.1(A).


 


Subordinated Debt:  any
Indebtedness of Borrower subordinated to the Loan in a manner acceptable to Lender.


 


Subordination(s):  the
meaning specified in Section 1.8.


 


Subsidiary:  with
reference to any Person, is a corporation, or similar association or entity not less than a majority of the outstanding shares
of the class or classes of stock, having by the terms thereof ordinary voting power to elect a majority of the directors, managers
or trustees of such corporation, association or entity, of which are at the time owned or controlled, directly or indirectly, by
such Person or by a Subsidiary of such Person.


 




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