FS Investment Corporation III 8-K


 


Exhibit 10.4


EXECUTION VERSION


 


 


December 2, 2014


 


 


DUNLAP FUNDING LLC,

as Pledgor


 


 


WELLS FARGO BANK, NATIONAL ASSOCIATION,

as Secured Party


 


 


and


 


 


WELLS FARGO BANK, NATIONAL ASSOCIATION,

as Securities Intermediary


 


 


SECURITIES ACCOUNT CONTROL AGREEMENT


 



    	 



    	 



    

 


TABLE OF CONTENTS


 


	 	 	 	Page
	 	 	 	 
	ARTICLE I	INTERPRETATION	 	1
	 	 	 	 
	ARTICLE II	APPOINTMENT OF SECURITIES INTERMEDIARY	 	1
	 	 	 	 
	ARTICLE III	THE SECURED ACCOUNTS	 	2
	 	 	 	 
	ARTICLE IV	THE SECURITIES INTERMEDIARY	 	4
	 	 	 	 
	ARTICLE V	INDEMNITY; LIMITATION ON DAMAGES; EXPENSES; FEES	 	8
	 	 	 	 
	ARTICLE VI	REPRESENTATIONS AND AGREEMENTS	 	9
	 	 	 	 
	ARTICLE VII	ADVERSE CLAIMS	 	10
	 	 	 	 
	ARTICLE VIII	TRANSFER	 	11
	 	 	 	 
	ARTICLE IX	TERMINATION	 	11
	 	 	 	 
	ARTICLE X	MISCELLANEOUS	 	11
	 	 	 	 
	ARTICLE XI	NOTICES	 	13
	 	 	 	 
	ARTICLE XII	GOVERNING LAW AND JURISDICTION	 	13
	 	 	 	 
	ARTICLE XIII	DEFINITIONS	 	14
	 	 	 	 
	ARTICLE XIV	LIMITED RECOURSE; NO BANKRUPTCY PETITION	 	15




 



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SECURITIES ACCOUNT CONTROL
AGREEMENT (this “Agreement”), dated as of December 2, 2014, among DUNLAP FUNDING LLC (the “Pledgor”)
and WELLS FARGO BANK, NATIONAL ASSOCIATION, as Collateral Agent on behalf of the Secured Parties (each as defined in the Loan
Agreement referred to below) (in such capacity, the “Secured Party”) and as securities intermediary (in such
capacity, the “Securities Intermediary”).


 


In consideration of the mutual
agreements hereinafter contained and for other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:


 


ARTICLE
I



INTERPRETATION


 


Section 1.        (a)        Definitions.
The terms defined in Section 13 will have the meanings therein specified for the purpose of this Agreement. In addition,
all terms used herein which are defined in (i) the Loan Financing and Servicing Agreement, dated as of the date hereof, among the
Pledgor, as borrower, the agents and lenders party thereto from time to time, Wells Fargo Bank, National Association, as collateral
agent and collateral custodian, and Deutsche Bank AG, New York Branch, as administrative agent (the “Loan Agreement”)
or (ii) in Article 8 or Article 9 of the UCC and which are, in each case, not otherwise defined herein are used herein
as so defined.


 


(b)        Rules of Construction.
Unless the context otherwise clearly requires: (i) the definitions of terms herein shall apply equally to the singular and
plural forms of the terms defined, (ii) whenever the context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms, (iii) the words “include,” “includes” and “including” shall
be deemed to be followed by the phrase “without limitation,” (iv) the word “will” shall be construed
to have the same meaning and effect as the word “shall,” (v) any definition of or reference to any agreement,
instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time
to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications
set forth herein), (vi) any reference herein to any Person shall be construed to include such Person’s successors and
assigns, (vii) the words “herein,” “hereof” and “hereunder,” and words of similar import,
shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, and (viii) all references
herein to Sections and Schedules shall be construed to refer to Sections of, and Schedules to, this Agreement.


 


ARTICLE
II



APPOINTMENT OF SECURITIES INTERMEDIARY


 


Section 2.        Each of the
Pledgor and the Secured Party hereby appoints the Securities Intermediary as securities intermediary hereunder. The Securities
Intermediary hereby accepts such appointment.


 



    	 



    	 



    

 


ARTICLE
III



THE SECURED ACCOUNTS


 


Section 3.        (a)        Establishment
of Secured Accounts. The Securities Intermediary acknowledges and agrees that, at the direction and on behalf of the Secured
Party, it has established and is maintaining on its books and records, in the name of the Pledgor, (i) the securities account
designated as the “Interest Collection Account” with account number 83447401, (ii) the securities account designated
as the “Principal Collection Account” with account number 83447402, (iii) the securities account designated as the
“Unfunded Exposure Account” with account number 83447403, (iv) the securities account designated as the “Payment
Subaccount” with account number 83447404 and (v) the securities account designated as the “Collection Account”
with account number 83447400 (such accounts, together with any sub-accounts, replacements thereof or substitutions therefor, the
“Secured Accounts”).


 


(b)        Status of Secured
Accounts; Treatment of Property as Financial Assets; Relationship of Parties. The Securities Intermediary hereby agrees with
the Pledgor and Secured Party that: (i) each Secured Account is a “securities account” (within the meaning of
Section 8-501(a) of the UCC) in respect of which the Securities Intermediary is a “securities intermediary” (within
the meaning of Section 8-102(a)(14) of the UCC), (ii) each item of property (whether cash, a security, an instrument
or any other property) credited to any Secured Account shall be treated as a “financial asset” (within the meaning
of Section 8-102(a)(9) of the UCC), and (iii) each Secured Account and any rights or proceeds derived therefrom are subject
to a security interest in favor of the Secured Party arising under the Loan Agreement. The Pledgor and Secured Party hereby direct
the Securities Intermediary, subject to the terms of this Agreement, to identify the Secured Party on its books and records as
the “entitlement holder” (as defined in Section 8-102(a)(7) of the UCC) with respect to each Secured Account and
the property held therein and the Securities Intermediary agrees to do the same.


 


(c)        Notwithstanding anything
herein to the contrary, it is hereby expressly acknowledged that (a) interests in Collateral Obligations may be acquired by the
Pledgor from time to time which are not evidenced by, or accompanied by delivery of, a security (as defined in Section 8-102 of
the UCC) or an instrument (as defined in Section 9-102(a)(47) of the UCC), and may be evidenced solely by delivery to the Securities
Intermediary of a facsimile copy of an assignment agreement (“Collateral Obligation Assignment Agreement”) in
favor of the Pledgor as assignee, (b) any such Collateral Obligation Assignment Agreement (and the registration of the related
Collateral Obligation on the books and records of the applicable obligor or bank agent) shall be registered in the name of the
Pledgor, and (c) any duty on the part of the Securities Intermediary with respect to such Collateral Obligation (including in respect
of any duty it might otherwise have to maintain a sufficient quantity of such Collateral Obligation for purposes of Section 8-504
of the UCC) shall be limited to the exercise of reasonable care by the Securities Intermediary in the physical custody of any such
Collateral Obligation Assignment Agreement that may be delivered to it. It is acknowledged and agreed that the Securities Intermediary
is not under a duty to examine Underlying Instruments to determine their validity or sufficiency (and shall have no responsibility
for the genuineness or completeness thereof), or for the Pledgor’s title to any related Collateral Obligation.


 



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(d)        The Securities Intermediary
will, by book-entry notation, promptly credit to the applicable Secured Account all property to be credited thereto pursuant to
the Loan Agreement.


 


(e)        Form of Securities,
Instruments, etc. All securities and other financial assets credited to any Secured Account that are in registered form or
that are payable to or to the order of shall be (i) registered in the name of, or payable to or to the order of, the Securities
Intermediary, (ii) indorsed to or to the order of the Securities Intermediary or in blank or (iii) credited to another
securities account maintained in the name of the Securities Intermediary; and in no case will any financial asset credited to any
Secured Account be registered in the name of, or payable to or to the order of, the Pledgor or any other person or indorsed to
or to the order of the Pledgor or any other person, except to the extent the foregoing have been specially indorsed to or to the
order of the Securities Intermediary or in blank.


 


(f)        Securities Intermediary’s
Jurisdiction. The Securities Intermediary agrees that, for the purposes of the UCC, its “securities intermediary’s
jurisdiction” (within the meaning of Section 8-110(e) of the UCC) shall be the State of New York.


 


(g)        Conflicts with
other Agreements. The Securities Intermediary agrees that, if there is any conflict between this Agreement (or any portion
thereof) and any other agreement (whether now existing or hereafter entered into) relating to any Secured Account, the provisions
of this Agreement shall prevail.


 


(h)        No Other Agreements.
The Securities Intermediary hereby confirms and agrees that:


 


(i)        other
than the Loan Agreement, there are no other agreements entered into between the Securities Intermediary and the Pledgor with respect
to any Secured Account or any financial asset or security entitlement credited thereto;


 


(ii)        other
than the Loan Agreement, it has not entered into, and until the termination of this Agreement will not enter into, any other agreement
with any other Person (including the Pledgor) relating to any Secured Account and/or any financial asset or security entitlement
thereto (A) pursuant to which it has agreed or will agree to comply with entitlement orders (as defined in Section 8-102(a)(8)
of the UCC) of such other Person or (B) with respect to the creation or perfection of any other security interest in any Secured
Account or any financial asset or security entitlement credited thereto; and


 


(iii)        it
has not entered into, and until the termination of this Agreement will not enter into, any agreement with the Pledgor or the Secured
Party purporting to limit or condition the obligation of the Securities Intermediary to comply with entitlement orders as set forth
in Section 3(i).


 


(i)        Transfer Orders,
Standing Instructions.


 


(i)        The
Pledgor, the Secured Party and the Securities Intermediary each agree that if at any time a Responsible Officer of the Securities
Intermediary shall receive an “entitlement order” (within the meaning of Section 8-102(a)(8) of the New York
UCC) or any other order originated by the Secured Party and relating to any Secured Account or any financial assets or security
entitlements credited thereto (collectively, a “Transfer Order”), the Securities Intermediary shall comply with
such Transfer Order without further consent by the Pledgor or any other Person.


 



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(ii)        At
any time prior to the delivery to and receipt by the Securities Intermediary of a Notice of Exclusive Control, the Securities Intermediary
shall comply with each Transfer Order it receives from the Pledgor or the Investment Manager on its behalf without the further
consent of the Secured Party or any other Person; provided that, in the event the Securities Intermediary receives conflicting
instructions from the Secured Party and the Pledgor, the Securities Intermediary shall follow the instructions received from the
Secured Party and not the instructions received from the Pledgor.


 


(iii)        Upon
the opening of business on the Business Day immediately following the Business Day on which a Notice of Exclusive Control is actually
received by the Securities Intermediary in accordance with the notice requirements hereunder, and until such Notice of Exclusive
Control is withdrawn or rescinded by the Secured Party in writing, the Securities Intermediary shall not comply with any Transfer
Order it receives from the Pledgor and shall act solely upon Transfer Orders received from the Secured Party.


 


(iv)        The
Secured Party hereby agrees with the Pledgor that it shall not deliver a Notice of Exclusive Control except after the occurrence
and during the continuation of a Facility Termination Event.


 


ARTICLE
IV



THE SECURITIES INTERMEDIARY


 


Section 4.        (a)        Performance
of Duties. The Securities Intermediary may execute any of the powers hereunder or perform any of its duties hereunder directly
or by or through agents, attorneys or employees. The Securities Intermediary shall be entitled to consult with counsel with a national
reputation in the applicable matter selected with due care and to act in reliance upon the advice or written opinion of such counsel
concerning matters pertaining to its duties hereunder, and shall not be liable for any action taken or omitted to be taken by it
in good faith in reliance upon and in accordance with the advice or written opinion of such counsel. Except as expressly provided
herein, the Securities Intermediary shall not be under any obligation to exercise any of the rights or powers vested in it by this
Agreement at the request or direction of the Secured Party.


 


(b)        No Change to Secured
Accounts. Without the prior written consent of the Pledgor and, so long as any Obligations remain unpaid, the Secured Party,
the Securities Intermediary will not change the account number or designation of any Secured Account.


 



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(c)        Certain Information.
The Securities Intermediary shall promptly notify the Pledgor and the Secured Party if a Responsible Officer of the Securities
Intermediary with direct responsibility for administration of this Agreement has actual knowledge of or receives written notice
that any Person asserts or seeks to assert a lien, encumbrance or adverse claim against any portion or all of the property credited
to any Secured Account. The Securities Intermediary will send copies of all statements, confirmations and other correspondence
relating to each Secured Account (and/or any financial assets credited thereto) simultaneously to the Pledgor and the Secured Party.
The Securities Intermediary will furnish to the Secured Party and the Pledgor, upon reasonable request, an account statement with
respect to each Secured Account.


 


(d)        Subordination.
In the event that the Securities Intermediary has or subsequently obtains by agreement, by operation of law or otherwise a security
interest in any of the Secured Accounts, or any financial asset credited thereto, the Securities Intermediary hereby subordinates
any such security interest therein to the security interest of the Secured Party in the Secured Accounts, in all property credited
thereto and in all security entitlements with respect to such property. Without limitation of the foregoing, the Securities Intermediary
hereby waives to such security interest of the Secured Party any and all statutory, regulatory, contractual or other rights now
or hereafter existing in favor of the Securities Intermediary over or with respect to any Secured Account, all property credited
thereto and all security entitlements to such property (including (i) any and all contractual rights of set-off, lien or compensation,
(ii) any and all statutory or regulatory rights of pledge, lien, set-off or compensation, (iii) any and all statutory,
regulatory, contractual or other rights to put on hold, block transfers from or fail to honor instructions of the Pledgor with
respect to any Secured Account or (iv) any and all statutory or other rights to prohibit or otherwise limit the pledge, assignment,
collateral assignment or granting of any type of security interest in any Secured Account), except the Securities Intermediary
may set off (i) the face amount of any checks that have been credited to any Secured Account but are subsequently returned unpaid
because of uncollected or insufficient funds and (ii) reversals or cancellations of payment orders and other electronic fund transfers.


 


(e)        Limitation on Liability.
The Securities Intermediary shall not have any duties or obligations except those expressly set forth herein and shall satisfy
those duties expressly set forth herein so long as it acts without gross negligence, willful misconduct or bad faith. Without limiting
the generality of the foregoing, the Securities Intermediary shall not be subject to any fiduciary duty or other implied duties,
and the Securities Intermediary shall not have any duty to take any discretionary action or exercise any discretionary powers.
None of the Securities Intermediary, any Affiliate of the Securities Intermediary, or any officer, agent, stockholder, partner,
member, director or employee of the Securities Intermediary or any Affiliate of the Securities Intermediary shall have any liability,
whether direct or indirect and whether in contract, tort or otherwise (i) for any action taken or omitted to be taken by any
of them hereunder or in connection herewith unless such act or omission constituted gross negligence, willful misconduct or bad
faith, or (ii) for any action taken or omitted to be taken by the Securities Intermediary in accordance with the terms hereof
at the express direction of the Secured Party. In addition, the Securities Intermediary shall have no liability for making any
investment or reinvestment of any cash balance in any Secured Account, or holding amounts uninvested in such accounts, pursuant
to the terms of this Agreement. The liabilities of the Securities Intermediary shall be limited to those expressly set forth in
this Agreement. The Securities Intermediary shall not be liable for any action a Responsible Officer of the Securities Intermediary
takes or omits to take in good faith that it reasonably believes to be authorized or within its rights or powers hereunder. The
Securities Intermediary shall not be deemed to have notice or knowledge of any Facility Termination Event unless a Responsible
Officer of the Securities Intermediary has actual knowledge thereof or unless written notice thereof is received by a Responsible
Officer of the Securities Intermediary. With the exception of this Agreement (and relevant terms used herein and expressly defined
in the Loan Agreement), the Securities Intermediary is not responsible for or chargeable with knowledge of any terms or conditions
contained in any agreement referred to herein, including, but not limited to, the Loan Agreement.


 



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(f)        Reliance. The
Securities Intermediary shall be entitled to conclusively rely upon, and shall not incur any liability for relying upon, any notice,
request, opinion, report, certificate, consent, statement, instrument, document or other writing including, but not limited to,
an electronic mail communication delivered to the Securities Intermediary under or in connection with this Agreement and in good
faith believed by it to be genuine and to have been signed or sent by the proper Person. The Securities Intermediary may consult
with legal counsel, independent accountants and other experts with a national reputation in the applicable matter selected by it
with due care, and shall not be liable for any action taken or not taken by the Securities Intermediary in good faith and in accordance
with the advice of any such counsel, accountants or experts. If at any time the Securities Intermediary reasonably requests instruction
with respect to any action or omission in connection with this Agreement, the Securities Intermediary shall be entitled (without
incurring any liability therefor to any person) to refrain from taking such action and continue to refrain from acting unless and
until the Securities Intermediary shall have received written instruction from the party from whom instruction was requested. The
reliances, protections, indemnities and immunities afforded to the Collateral Custodian in the Loan Agreement shall be afforded
to the Securities Intermediary as though fully set forth herein.


 


(g)        Court Orders, etc.
If at any time the Securities Intermediary is served with any judicial or administrative order, judgment, decree, writ or other
form of judicial or administrative process which in any way affects any Secured Account (including, but not limited to, orders
of attachment or garnishment or other forms of levies or injunctions or stays relating to the transfer of any Secured Account or
any financial asset in any Secured Account), the Securities Intermediary is authorized to take such action as legal counsel of
its own choosing with a national reputation in the applicable matter advises appropriate to comply therewith; and if the Securities
Intermediary complies with any such judicial or administrative order, judgment, decree, writ or other form of judicial or administrative
process, the Securities Intermediary will not be liable to any of the parties hereto or to any other person or entity even though
such order, judgment, decree, writ or process may be subsequently modified or vacated or otherwise determined to have been without
legal force or effect.


 


(h)        Successor Securities
Intermediary.


 


(i)        Merger.
Any Person into whom the Securities Intermediary may be converted or merged, or with whom it may be consolidated, or to whom it
may sell or transfer its trust or other business and assets as a whole or substantially as a whole, or any Person resulting from
any such conversion, sale, merger, consolidation or transfer to which the Securities Intermediary is a party, shall (provided
it is otherwise qualified to serve as the Securities Intermediary hereunder) be and become a successor Securities Intermediary
hereunder and be vested with all of the powers, immunities, privileges and other matters as was its predecessor without the execution
or filing of any instrument or any further act, deed or conveyance on the part of any of the parties hereto, anything herein to
the contrary notwithstanding.


 



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(ii)        Resignation.
The Securities Intermediary and any successor thereto may at any time resign by giving sixty (60) days’ written notice
by registered, certified or express mail to the Secured Party and the Pledgor; provided that such resignation shall take
effect only upon the effective date of the appointment of a successor Securities Intermediary acceptable to the Secured Party and
the Pledgor, as evidenced by their written consent and the acceptance in writing by such successor Securities Intermediary of such
appointment and of its obligation to perform its duties hereunder in accordance with the provisions hereof. Subject to the preceding
sentence, if on the 90th day after written notice of resignation is delivered by a resigning party as described
above no successor party or temporary successor Securities Intermediary has been appointed in accordance herewith, the resigning
party may petition a court of competent jurisdiction in New York City for the appointment of a successor.


 


(i)        Compensation and
Reimbursement. The Pledgor agrees: (i) to pay to the Securities Intermediary its fees for all services rendered by it
hereunder; and (ii) without duplication of amounts payable under Section 5(b), to reimburse the Securities Intermediary
upon its request for all reasonable and documented out-of-pocket expenses, disbursements and advances incurred or made by the Securities
Intermediary in accordance with any provision of, or carrying out its duties and obligations under, this Agreement (including the
reasonable, documented and out-of-pocket compensation and fees and the expenses and disbursements of its agents, any Independent
Accountants and outside counsel).


 


(j)        Securities Intermediary
and its Affiliates. Wells Fargo Bank, National Association and any of its Affiliates providing services in connection with
the transactions contemplated in the Transaction Documents shall have only the duties and responsibilities expressly provided in
its various capacities and shall not, by virtue of it or any Affiliate acting in any other capacity be deemed to have duties or
responsibilities other than as expressly provided with respect to each such capacity. Wells Fargo Bank, National Association (or
its Affiliates), in its various capacities in connection with the transactions contemplated in the Transaction Documents, including
as Securities Intermediary, may enter into business transactions, including the acquisition of investment securities as contemplated
by the Transaction Documents, from which it and/or such Affiliates may derive revenues and profits in addition to the fees stated
in the various Transaction Documents, without any duty to account therefor.


 


(k)        Force Majeure.
In no event shall the Securities Intermediary be responsible or liable for any failure or delay in the performance of its obligations
hereunder arising out of or caused by, directly or indirectly, forces beyond its control, including, without limitation, strikes,
work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of
God, and interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services, it being
understood that the Securities Intermediary shall use reasonable best efforts which are consistent with accepted practices in the
banking industry to maintain performance and, if necessary, resume performance as soon as practicable under the circumstances.


 



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(l)        Perfection.
The Securities Intermediary shall have no responsibility or liability for (i) preparing, recording, filing, re-recording or refiling
any financing statement, continuation statement, document, instrument or other notice in any public office at any time or times,
(ii) the correctness of any such financing statement, continuation statement, document or instrument or other such notice, (iii)
taking any action to perfect or maintain the perfection of any security interest granted to the Secured Party or otherwise, or
(iv) the validity or perfection of any such lien or security interest.


 


(m)        Facsimile and Electronic
Transmissions. The Securities Intermediary agrees to accept and act upon instructions or directions pursuant to this Agreement
sent by unsecured e-mail, facsimile transmission or other similar unsecured electronic methods, provided that any person
providing such instructions or directions shall provide to the Securities Intermediary an incumbency certificate listing such designated
persons, which such incumbency certificate shall be amended and replaced whenever a person is to be added or deleted from the listing.
If the Pledgor elects to give the Securities Intermediary e-mail or facsimile instructions (or instructions by a similar electronic
method), the Securities Intermediary’s understanding of such instructions shall be deemed controlling. The Securities Intermediary
shall not be liable for any losses, costs or expenses arising directly or indirectly from the Securities Intermediary’s reliance
upon and compliance with such instructions notwithstanding such instructions conflict or are inconsistent with a subsequent written
instruction. The Pledgor agrees to assume all risks arising out of the use of such electronic methods to submit instructions and
directions to the Securities Intermediary, including, without limitation, the risk of the Securities Intermediary acting on unauthorized
instructions, and the risk of interception and misuse by third parties.


 


ARTICLE
V



INDEMNITY; LIMITATION ON DAMAGES; EXPENSES; FEES


 


Section 5.        (a)        Indemnity.
(i) Subject to Section 5(a)(ii), the Pledgor hereby indemnifies and holds harmless the Securities Intermediary, its
Affiliates and their respective officers, directors, employees, representatives and agents (collectively referred to for the purposes
of this Section 5(a) only as the Securities Intermediary), against any loss, claim, damage, expense or liability (including
the costs and expenses of defending against any claim of liability), or any action in respect thereof, in each case to the extent
actually awarded or actually incurred by the Securities Intermediary, to which the Securities Intermediary may become subject,
whether commenced or threatened, insofar as such loss, claim, damage, expense, liability or action arises out of or is based upon
the execution, delivery or performance of this Agreement, but excluding any such loss, claim, damage, expense, liability or action
arising out of the bad faith, gross negligence or willful misconduct of the Securities Intermediary, and shall reimburse the Securities
Intermediary promptly upon demand for any reasonable and documented out-of-pocket legal or other expenses reasonably incurred by
the Securities Intermediary in connection with investigating or preparing to defend or defending against or appearing as a third
party witness in connection with any such loss, claim, damage, expense, liability or action as such expenses are incurred. No provision
of this Agreement shall require the Securities Intermediary to expend or risk its own funds or otherwise incur any financial liability
in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured
to it. The obligations of the Pledgor under this clause (a) are referred to as the “Securities Intermediary Indemnity”.
The provisions of this section will survive the termination of this Agreement and the resignation or removal of the Securities
Intermediary.


 



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(ii)        The
obligation of the Pledgor to pay any amounts in respect of the Securities Intermediary Indemnity shall be subject to the priority
of payments set forth in the Loan Agreement and shall survive the termination of this Agreement and the resignation or removal
of the Securities Intermediary and the Securities Intermediary shall be considered the Collateral Custodian for such purposes.


 


(b)        Expenses and Fees.
The Pledgor shall be responsible for, and hereby agrees to pay, all reasonable and documented out-of-pocket costs and expenses
incurred by the Securities Intermediary in connection with the establishment and maintenance of each Secured Account, including
the Securities Intermediary’s customary fees and expenses, any reasonable and documented out-of-pocket costs or expenses
incurred by the Securities Intermediary as a result of conflicting claims or notices involving the parties hereto, including the
reasonable fees and expenses of its external legal counsel, and all other reasonable costs and expenses incurred in connection
with the execution, administration or enforcement of this Agreement, including reasonable fees and costs of its external legal
counsel, whether or not such enforcement includes the filing of a lawsuit, in each case except any expenses as may be attributable
to gross negligence, bad faith or willful misconduct on the part of the Securities Intermediary. Notwithstanding anything to the
contrary provided herein, all amounts payable by the Pledgor to the Securities Intermediary under this Agreement shall be payable
only in accordance with, and subject to, Section 8.3 of the Loan Agreement and the Securities Intermediary shall be considered
the Collateral Custodian for such purposes.


 


(c)        No Consequential
Damages. Notwithstanding anything in this Agreement to the contrary, in no event shall the Pledgor or the Securities Intermediary
be liable for special, punitive, indirect or consequential loss or damage of any kind whatsoever (including, but not limited to,
lost profits), even if the Pledgor or the Securities Intermediary has been advised of the likelihood of such loss or damage and
regardless of the form of action.


 


ARTICLE
VI



REPRESENTATIONS AND AGREEMENTS


 


Section 6.        The Securities
Intermediary represents to and agrees with the Pledgor and the Secured Party that:


 


(a)        Status. It
is duly organized and validly existing under the laws of the jurisdiction of its organization or incorporation and, if relevant
under such laws, in good standing.


 



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(b)        Powers. It
has the power to execute this Agreement and any other documentation relating to this Agreement to which it is a party, to deliver
this Agreement and any other documentation relating to this Agreement that it is required by this Agreement to deliver and to perform
its obligations under this Agreement and has taken all necessary action to authorize such execution, delivery and performance;
and this Agreement has been, and each other such document will be, duly executed and delivered by it.


 


(c)        Obligations Binding.
Its obligations under this Agreement constitute its legal, valid and binding obligations, enforceable in accordance with their
respective terms (subject to applicable bankruptcy, reorganization, insolvency, moratorium or similar laws affecting creditors’
rights generally and subject, as to enforceability, to equitable principles of general application (regardless of whether enforcement
is sought in a proceeding in equity or at law)).


 


(d)        Waiver of Setoffs.
The Securities Intermediary hereby expressly waives any and all rights of setoff that such party may otherwise at any time have
under Applicable Law with respect to any Secured Account except as set forth in Section 4(d).


 


(e)        Ordinary Course.
The Securities Intermediary, in the ordinary course of its business, maintains securities accounts for others and is acting in
such capacity in respect of any Secured Account.


 


(f)         Comply with Duties.
The Securities Intermediary will comply at all times with the duties of a “securities intermediary” under Article 8
of the UCC.


 


(g)        Participant of
the Federal Reserve Bank of New York. The Securities Intermediary is a member of the Federal Reserve System.


 


(h)        Consents. All
governmental and other consents that are required to have been obtained by the Secured Party with respect to the execution, delivery
and performance by the Secured Party of this Agreement have been obtained and are in full force and effect and all conditions of
any such consents have been complied with.


 


ARTICLE
VII



ADVERSE CLAIMS


 


Section 7.        Except for
the claims and interest set forth in this Agreement, no Responsible Officer of the Securities Intermediary actually knows of any
claim to, or interest in, any Secured Account or in any “financial asset” (as defined in Section 8-102(a)(9) of
the UCC) credited thereto. If a Responsible Officer of the Securities Intermediary has actual knowledge of or receives written
notice that any Person asserts or seeks to assert a lien, encumbrance or adverse claim (including any writ, garnishment, judgment,
warrant of attachment, execution or similar process) against any Secured Account or in any financial asset carried therein, the
Securities Intermediary will promptly notify the Pledgor thereof (and the Pledgor shall promptly notify the Secured Party thereof).


 



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ARTICLE
VIII



TRANSFER


 


Section 8.        Neither this
Agreement nor any interest or obligation in or under this Agreement may be transferred (whether by way of security or otherwise)
by any party without the prior written consent of each other party. Any purported transfer that is not in compliance with this
Section 8 will be void.


 


ARTICLE
IX



TERMINATION


 


Section 9.        The rights
and powers granted herein to the Secured Party have been granted in order to perfect its security interest in each Secured Account
and the financial assets credited thereto, are powers coupled with an interest and will be affected neither by the bankruptcy of
the Pledgor nor by the lapse of time. The obligations of the Securities Intermediary hereunder shall continue in effect until the
earlier of (a) that date upon which the security interest of the Secured Party in each Secured Account has been terminated,
and (b) that date on which the Secured Party releases or terminates its security interest in each Secured Account.


 


ARTICLE
X



MISCELLANEOUS


 


Section 10.        (a)        Entire
Agreement. This Agreement and the Loan Agreement constitutes the entire agreement and understanding of the parties with respect
to its subject matter and supersedes all oral communication and prior writings with respect thereto.


 


(b)        Amendments.
No amendment, modification or waiver in respect of this Agreement will be effective unless in writing (including a writing evidenced
by a facsimile transmission or e-mail correspondence), executed by each of the parties hereto.


 


(c)        Survival. All
representations and warranties made in this Agreement or in any certificate or other document delivered pursuant to or in connection
with this Agreement shall survive the execution and delivery of this Agreement or such certificate or other document (as the case
may be) or any deemed repetition of any such representation or warranty. In addition, the rights of the Securities Intermediary
under Sections 4 and 5, and the obligations of the Pledgor under Section 5, shall survive the
termination of this Agreement.


 


(d)        Benefit of Agreement.
Subject to Section 8, this Agreement shall be binding upon and inure to the benefit of the Pledgor, the Secured Party
and the Securities Intermediary and their respective successors and permitted assigns. The Securities Intermediary acknowledges
and consents to the assignment of this Agreement by the Pledgor to the Secured Party for the benefit of the Secured Parties under
the Loan Agreement.


 



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(e)        Counterparts.
This Agreement (and each amendment, modification and waiver in respect of it) may be executed and delivered in counterparts (including
by facsimile transmission and e-mail correspondence), each of which will be deemed an original.


 


(f)        No Waiver of Rights.
A failure or delay in exercising any right, power or privilege in respect of this Agreement will not be presumed to operate as
a waiver, and a single or partial exercise of any right, power or privilege will not be presumed to preclude any subsequent or
further exercise, of that right, power or privilege or the exercise of any other right, power or privilege.


 


(g)        Headings. The
headings used in this Agreement are for convenience of reference only and are not to affect the construction of or to be taken
into consideration in interpreting this Agreement.


 


(h)        Severability.
If any provision of this Agreement, or the application thereof to any party or any circumstance, is held to be unenforceable, invalid
or illegal (in whole or in part) for any reason (in any jurisdiction), the remaining terms of this Agreement, modified by the deletion
of the unenforceable, invalid or illegal portion (in any relevant jurisdiction), will continue in full force and effect, and such
unenforceability, invalidity, or illegality will not otherwise affect the enforceability, validity or legality of the remaining
terms of this Agreement so long as this Agreement, as so modified, continues to express, without material change, the original
intentions of the parties as to the subject matter hereof and the deletion of such portion of this Agreement will not substantially
impair the respective expectations of the parties or the practical realization of the benefits that would otherwise be conferred
upon the parties.


 


(i)        No Agency.
Notwithstanding anything that may be construed to the contrary, it is understood and agreed that the Securities Intermediary is
not, nor shall it be considered to be, an agent of the Secured Party. In addition, the Securities Intermediary shall not act or
represent itself, directly or by implication, as an agent of the Secured Party or in any manner assume or create any obligation
whatsoever on behalf of, or in the name of, the Secured Party.


 


(j)        Payments by Pledgor.
Any amounts required to be paid pursuant to this Agreement by the Pledgor shall be paid or caused to be paid by the Pledgor to
the applicable Person on the Distribution Date following such Person’s demand therefor in accordance with Section 8.3
of the Loan Agreement, provided that such demand is made no later than two (2) Business Days prior to the applicable Distribution
Date, and the Securities Intermediary shall be considered the Collateral Custodian for such purposes.


 



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(k)        Taxes. For
all U.S. federal tax reporting purposes, all income earned on the funds invested and allocable to the Secured Accounts is legally
owned by the Pledgor (and beneficially owned by such Pledgor or the equity Pledgor or owners of such entity as documented in the
IRS forms and other documentation described below). Such Pledgor is required to provide to Wells Fargo, in its capacity as Securities
Intermediary (i) an IRS Form W-9 or appropriate IRS Form W-8 no later than the date hereof, and (ii) any additional IRS forms (or
updated versions of any previously submitted IRS forms) or other documentation at such time or times required by applicable law
or upon the reasonable request of the Securities Intermediary as may be necessary (i) to reduce or eliminate the imposition of
U.S. withholding taxes and (ii) to permit the Securities Intermediary to fulfill its tax reporting obligations under applicable
law with respect to the Secured Accounts or any amounts paid to Company. The Pledgor is further required to report to the Securities
Intermediary comparable information upon any change in the legal or beneficial ownership of the income allocable to the Secured
Accounts. Wells Fargo, both in its individual capacity and in its capacity as Securities Intermediary, shall have no liability
to Pledgor or any other person in connection with any tax withholding amounts paid, or retained for payment, to a governmental
authority from the Secured Accounts arising from Company’s failure to timely provide an accurate, correct and complete IRS
Form W-9, an appropriate IRS Form W-8 or such other documentation contemplated under this paragraph. For the avoidance of doubt,
no funds shall be invested with respect to such Secured Accounts absent the Securities Intermediary having first received (i) instructions
with respect to the investment of such funds, and (ii) the forms and other documentation required by this paragraph.


 


ARTICLE
XI



NOTICES


 


Section 11.        (a)        Effectiveness.
Any notice or other communication in respect of this Agreement may be given in any manner set forth in Section 17.3 of the Loan
Agreement.


 


(b)        Change of Addresses.
Any party hereto may by written notice to each other party hereto, change the address or facsimile number at which notices or other
communications are to be given to it hereunder.


 


ARTICLE
XII



GOVERNING LAW AND JURISDICTION


 


Section 12.        (a)        Governing
Law. This Agreement, each Secured Account and any matter arising among the parties under or in connection with this Agreement
or any Secured Account, will be governed by and construed in accordance with the laws of the State of New York.


 


(b)        Jurisdiction.
Each party hereto hereby irrevocably submits to the non-exclusive jurisdiction of any New York State or Federal court sitting in
New York City in any action or proceeding arising out of or relating to the Transaction Documents (each, a “Proceeding”),
and each party hereto hereby irrevocably agrees that all claims in respect of such Proceeding may be heard and determined in such
New York State court or, to the extent permitted by law, in such Federal court. The parties hereto hereby irrevocably waive, to
the fullest extent they may effectively do so, the defense of an inconvenient forum to the maintenance of any such Proceeding.
The parties hereto agree that a final judgment in any such Proceeding shall be conclusive and may be enforced in other jurisdictions
by suit on the judgment or in any other manner provided by law.


 



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(c)        Waiver of Jury
Trial Right. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT THAT
IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY PROCEEDING. Each party hereby (i) certifies that no representative, agent
or attorney of any other party has represented, expressly or otherwise, that any other party would not, in the event of a Proceeding,
seek to enforce the foregoing waiver, and (ii) acknowledges that it has been induced to enter into this Agreement by, among
other things, the mutual waivers and certifications in this Section 12(c).


 


ARTICLE
XIII



DEFINITIONS


 


Section 13.        As used in
this Agreement:


 


“Affiliate”
of any Person means any other Person that directly or indirectly Controls, is Controlled by or is under common Control with such
Person (excluding any trustee under, or any committee with responsibility for administering, any employee benefit plan). For the
purposes of this definition, “Control” shall mean the possession, directly or indirectly (including through
affiliated entities), of the power to direct or cause the direction of the management or policies of a Person, whether through
the ownership of voting securities, by contract or otherwise, and the terms “Controlling” and “Controlled”
shall have meanings correlative thereto.


 


“Agreement”
has the meaning specified in the Recitals.


 


“consent”
includes a consent, approval, action, authorization, exemption, notice, filing, registration or exchange control consent.


 


“law”
means any treaty, law, rule or regulation (as modified, in the case of tax matters, by the practice of any relevant governmental
revenue authority) and “lawful” and “unlawful” will be construed accordingly.


 


“Loan Agreement”
has the meaning specified in Section 1(a).


 


“Notice of Exclusive
Control” means a notice delivered to and received by the Securities Intermediary by the Secured Party in accordance with
Section 11(a) stating that the Secured Party is exercising exclusive control over the Secured Accounts.


 


“Person”
means any natural person or legal entity, including, without limitation, any corporation, partnership, limited liability company,
statutory or common law trust, or governmental entity or unit.


 


“Pledgor”
has the meaning specified in the Recitals.


 


“Proceeding”
has the meaning specified in Section 12(b).


 



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“Responsible Officer”
means any officer within the corporate trust office of the Securities Intermediary, including any director, vice president, assistant
vice president or associate, having direct responsibility, for the administration of this Agreement, who at the time shall be such
officers, respectively, or to whom any matter is referred because of his or her knowledge of and familiarity with the particular
subject.


 


“Secured Accounts”
has the meaning specified in Section 3(a).


 


“Secured Party”
has the meaning specified in the Recitals.


 


“Securities Intermediary”
has the meaning specified in the Recitals.


 


“Securities Intermediary
Indemnity” has the meaning specified in Section 5(a).


 


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


 


ARTICLE
XIV



LIMITED RECOURSE; NO BANKRUPTCY PETITION


 


Section 14.        The obligations
of the Pledgor are solely corporate obligations of the Pledgor and no action shall be taken against the members or officers of
the Pledgor in connection with such obligations. The parties hereto agree that they shall not institute against, or join any other
Person in instituting against the Pledgor, any bankruptcy, reorganization, arrangement, insolvency, moratorium or liquidation proceedings
or other proceedings under U.S. federal or state bankruptcy laws or any similar laws until at least one year and one day after
payment in full of the Advances. This Section 14 shall survive the expiration or termination of this Agreement.


 



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IN WITNESS WHEREOF the parties have executed
this Agreement on the date first set forth above with effect from such date.


 


	 	Pledgor:
	 	 
	 	DUNLAP FUNDING LLC, as Pledgor
	 	 	 
		By:	/s/ Gerald F. Stahlecker
	 	 	Name: Gerald F. Stahlecker
	 	 	Title: Executive Vice President



 


 


Securities Account Control Agreement



    	 



    	 



    

 


	 	Secured Party:
	 	 
	 	WELLS FARGO BANK, NATIONAL ASSOCIATION,
as Secured Party
	 	 	 
		By:	/s/ José M. Rodríguez
	 	 	Name: José M. Rodríguez
	 	 	Title: Vice President



 


 


Securities Account Control Agreement




    	 



    	 



    

 


	 	Securities Intermediary:
	 	 
	 	WELLS FARGO BANK, NATIONAL ASSOCIATION,
as Securities Intermediary
	 	 	 
		By:	/s/ José M. Rodríguez
	 	 	Name: José M. Rodríguez
	 	 	Title: Vice President



 


 


Securities Account Control Agreement