Document:

PLEDGE
AND SECURITY AGREEMENT

 

THIS
PLEDGE AND SECURITY AGREEMENT, dated as of May 31, 2017 (as the same may be amended, restated or otherwise modified from time
to time, this “Agreement”), is made by ROYAL ENERGY RESOURCES, INC., a Delaware corporation (the “Borrower”),
having an address at 56 Broad Street, Suite 2, Charleston, SC 29401, in favor of CEDARVIEW OPPORTUNITIES MASTER FUND, L.P., a
Delaware limited partnership (together with it successors and assigns, the “Secured Party”).

 

RECITALS:

 

(1)   This Agreement is made pursuant to the Secured Promissory Note, dated as of the date hereof (as amended, restated or otherwise modified from time to time, the “Note”), in the principal amount of $2,500,000.00, made by the Borrower to the order of the Secured Party.

 

(2)   It is a condition precedent to the making of loan contemplated by the Note that the Borrower shall have executed and delivered to the Secured Party this Agreement.

 

NOW,
THEREFORE, in consideration of the benefits accruing to the Borrower, the receipt and sufficiency of which are hereby acknowledged,
the Borrower hereby makes the following representations and warranties to the Secured Party and hereby covenants and agrees with
the Secured Party as follows:

 

ARTICLE
I.

 

DEFINITIONS AND TERMS

 

Section
1.01 Defined Terms. Capitalized terms used in this Agreement and not otherwise defined in this Agreement shall have the
meanings given to such terms in the Note. Unless otherwise defined herein, all terms used herein and defined in the UCC shall
have the same definitions herein as specified therein; provided, however, that if a term is defined in Article 9
of the UCC differently than in another Article of the UCC, the term shall have the meaning specified in Article 9 of the UCC.

 

Section
1.02 Additional Defined Term. The following terms shall have the meanings herein specified unless the context otherwise
requires: 

 

“Agreement”
has the meaning provided in the first paragraph of this Agreement.

 

“Borrower”
has the meaning provided in the first paragraph of this Agreement.

 

“Closing
Date” means the date of this Agreement.

 

“Collateral”
has the meaning provided in Section 2.01 hereof.

 

“Common
Units” means the common units issued by Rhino, as such term is defined in Rhino Partnership Agreement.

 

“Control”
means when used with respect to any security or security entitlement, the meaning specified in Section 8-106 of the UCC.

 

“Control
Acknowledgement” means, with respect to any uncertificated securities of Rhino owned by the Borrower, an agreement by
Rhino under which it has ageed to comply with instructions originated by the Secured Party without further consent by the Borrower,
in a form sufficient to provide the Secured Party with control over such securities, as such term is defined by Section 8-106(c)(2)
of the UCC.

 

    	 

    	 

    

 

“Controlled
Securities Account” means a securities account that (i) is maintained in the name of the Borrower at an office of a
Securities Intermediary located in the United States of America and (ii) together with all financial assets credited thereto and
all related security entitlements, is subject to a Securities Account Control Agreement.

 

“Deliver,”
“Delivered” and “Delivery” means the delivery of an uncertificated security as provided
in Section 8-301(b) of the UCC.

 

“Governmental
Authority” means the government of the United States of America or any other nation, or of any political subdivision
thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity
exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.

 

“Note”
has the meaning provided in the Recitals of this Agreement.

 

“Notice
of Exclusive Control” means a “Notice of Exclusive Control” as defined in any Securities Account Control
Agreement.

 

“Pledged
Equity Interests” means 5,000,000 Common Units now owned or hereafter acquired by the Borrower, and all of the Borrower’s
other rights, title and interests in, or in any way related to such Common Units, including, without limitation: (i) all dividends,
cash, instruments and other property hereafter from time to time received, receivable or otherwise distributed in respect of or
in exchange for any or all of such Common Units and in all profits, losses and other distributions to which the Borrower shall
at any time be entitled in respect of such Common Units; (ii) all other payments due or to become due to the Borrower in respect
of any such Common Units, whether under the Rhino Partnership Agreement, other agreement or otherwise, whether as contractual
obligations, damages, insurance proceeds or otherwise; (iii) all of the Borrower’s claims, rights, powers, privileges, authority,
puts, calls, options, security interests, liens and remedies, if any, under the Rhino Partnership Agreement, other agreement or
at law or otherwise in respect of such Common Units; (iv) all of the Borrower’s rights under the Rhino Partnership Agreement,
other agreement or at law to exercise and enforce every right, power, remedy, authority, option and privilege of the Borrower
relating to such Common Units; (v) all other property hereafter delivered in substitution for or in addition to any of the foregoing;
(vi) all certificates and instruments representing or evidencing any of the foregoing; and (vii) all cash, securities, interest,
distributions, dividends, rights and other property at any time and from time to time received, receivable or otherwise distributed
in respect of or in exchange for any or all thereof.

 

“Proceeds”
means (i) all proceeds; and (ii) without limitation of the foregoing and in all cases, including, but not be limited to, (A) whatever
is acquired upon the sale, lease, license, exchange, or other disposition of any Collateral, (B) whatever is collected on, or
distributed on account of, any Collateral, (C) rights arising out of any Collateral, (D) claims arising out of the loss or nonconformity
of, defects in, or damage to any Collateral, (E) claims and rights to any proceeds of any insurance, indemnity, warranty or guaranty
payable to the Borrower (or the Secured Party, as assignee, loss payee or an additional insured) with respect to any of the Collateral,
(G) claims and rights to payments (in any form whatsoever) made or due and payable to the Borrower from time to time in connection
with any requisition, confiscation, condemnation, seizure or forfeiture of all or any part of the Collateral by any Governmental
Authority (or any Person acting under color of Governmental Authority), (H) all cash, money, checks and negotiable instruments
received or held on behalf of the Secured Party pursuant to any lockbox or similar arrangement relating to the payment of Collateral,
and (I) any and all other amounts from time to time paid or payable under or in connection with any of the Collateral.

 

    	 	- 2 -	 

    	 

    

 

“Rhino”
means Rhino Resource Partners LP, a Delaware limited partnership.

 

“Rhino
Partnership Agreement” means the Fourth Amended and Restated Partnership Agreement of Limited Partnership of Rhino.

 

“Secured
Obligations” means, collectively, the principal of and interest on the Note and all other indebtedness, obligations
and liabilities owing by the Borrower to the Secured Party under the Note and the other Loan Documents (including, without limitation,
indemnities, fees and other amounts payable thereunder), whether primary, secondary, direct, contingent, fixed or otherwise, in
all cases whether now existing, or hereafter incurred or arising, including any such interest or other amounts incurred or arising
during the pendency of any bankruptcy, insolvency, reorganization, receivership or similar proceeding, regardless of whether allowed
or allowable in such proceeding or subject to an automatic stay under Section 362(a) of the Bankruptcy Code.

 

“Secured
Party” has the meaning provided in the first paragraph of this Agreement.

 

“Securities
Account Control Agreement” means, with respect to a securities account of the Borrower, a securities account control
agreement among the relevant Securities Intermediary, the Borrower and the Secured Party, in such form as is satisfactory to the
Secured Party in its sole disrection.

 

“Securities
Act” means the Securities Act of 1933, as amended, as the same may be in effect from time to time.

 

“Securities
Intermediary” means a clearing corporation or a Person, including, without limitation, a bank or broker, that in the
ordinary course of its business maintains securities accounts for others and is acting in that capacity.

 

“UCC”
means, unless the context indicates otherwise, the Uniform Commercial Code, as at any time adopted and in effect in the State
of New York, specifically including and taking into account all amendments, supplements, revisions and other modifications thereto.

 

Section
1.03 Terms Generally. The definitions of terms herein shall apply equally to the singular and plural forms of the
terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms.
The words “include,” “includes” and “including” shall be deemed to be followed by the phrase
“without limitation.” The word “will” shall be construed to have the same meaning and effect as the word
“shall.” Unless the context requires otherwise, (a) 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,
restated, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set
forth herein), (b) any reference herein to any Person shall be construed to include such Person’s successors and assigns,
(c) 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 (d) unless otherwise specified, all
references herein to Sections, Schedules, Annexes and Exhibits shall be construed to refer to Sections of, and Schedules, Annexes
and Exhibits to, this Agreement.

 

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ARTICLE
II.

SECURITY INTEREST

 

Section
2.01 Grant of Security Interest. As security for the prompt and complete payment and performance when due of all of the
Secured Obligations, the Borrower does hereby pledge, sell, assign and transfer unto the Secured Party, and does hereby grant
to the Secured Party, a continuing security interest in all of the right, title and interest of the Borrower in, to and under
all of the following of the Borrower, whether now existing or hereafter from time to time arising or acquired and wherever located
(collectively, the “Collateral”): 

 

(i)
the Pledged Equity Interests;

 

(ii)
all securities accounts, together with all financial assets credited therein from time to time, and all security
entitlements, financial assets, monies, securities, cash and other property held therein or credited thereto, in each case to
the extent constituting, relating to or arising out of the Pledged Equity Interests;

 

(iii)
all investment property, in each case to the extent constituting Pledged Equity Interests;

 

(iv)
all general intangibles, in each case to the extent constituting, relating to or arising out of the Pledged Equity
Interests;

 

(v)
all payment intangibles, in each case to the extent constituting, relating to or arising out of the Pledged Equity
Interests;

 

(vi)
all supporting obligations, in each case to the extent constituting, relating to or arising out of the Pledged Equity
Interests;

 

(vii)
all additions, modifications, alterations, improvements, upgrades, accessions, components, parts, appurtenances,
substitutions and/or replacements of, to or for any of the foregoing; and

 

(viii)
all Proceeds and products of any and all of the foregoing.

 

Section
2.02No Assumption of Liability. The security interest hereunder is granted as security only and shall not subject the
Secured Party to, or in any way alter or modify, any obligation or liability of the Borrower with respect to or arising out of
any of the Collateral. 

 

Section
2.03Power of Attorney. The Borrower hereby irrevocably constitutes and appoints the Secured Party its true and lawful
agent and attorney-in-fact, and in such capacity the Secured Party shall have, without any further action required by or on behalf
of the Borrower, the right, with full power of substitution, in the name of the Borrower or otherwise, for the use and benefit
of the Secured Party after the occurrence of and during the continuance of an Event of Default: (i) to receive, endorse, present,
assign, deliver and/or otherwise deal with any and all notes, acceptances, letters of credit, checks, drafts, money orders, or
other evidences of payment relating to the Collateral or any part thereof; (ii) to demand, collect, receive payment of, and give
receipt for and give credits, allowances, discounts, discharges, releases and acquittances of and for any or all of the Collateral;
(iii) to commence and prosecute any and all suits, actions or proceedings at law or in equity in or before any court or other
tribunal (including any arbitration proceedings) to collect or otherwise realize on all or any of the Collateral, or to enforce
any rights of the Borrower in respect of any of its Collateral; (iv) to settle, compromise, compound, adjust or defend any actions,
suits or proceedings relating to any or all of the Collateral; and (v) to use, sell, assign, transfer, pledge, make any agreement
with respect to or otherwise deal with any or all of the Collateral, and to do all other acts and things necessary or appropriate
to carry out the intent and purposes of this Agreement, as fully and completely as though the Secured Party were the absolute
owner of the Collateral for all purposes.

 

    	 	- 4 -	 

    	 

    

 

ARTICLE
III.

 

REPRESENTATIONS
AND WARRANTIES

 

The
Borrower represents and warrants to the Secured Party, which representations and warranties shall survive the execution and delivery
of this Agreement until the termination of this Agreement in accordance with Section 8.08, as follows:

 

Section
3.01 Title and Authority. The Borrower has (i) good, valid and unassailable title to all tangible items owned by it and
constituting any portion of the Collateral with respect to which it has purported to grant the security interest, and good, valid
and unassailable rights in all other Collateral with respect to which it has purported to grant the security interest, and (ii)
full power and authority to grant to the Secured Party the security interest in such Collateral pursuant hereto and to execute,
deliver and perform its obligations in accordance with the terms of this Agreement, without the consent or approval of any other
Person other than any consent or approval that has been obtained. 

 

Section
3.02 Absence of Other Liens 

 

(a)
There is no financing statement (or similar statement or instrument of registration under the law of any jurisdiction)
covering or purporting to cover any interest of any kind of the Borrower in the Collateral, except for any filings or
recordings made by the Secured Party.

 

(b)
The Borrower is, and as to any Collateral acquired by it from time to time after the date hereof the Borrower will be, the
owner of all of the Collateral, free and clear of any Lien (other than the Lien granted to the Secured Party), and the
security interest of the Borrower therein is and will be superior and prior to any other security interest or other
Lien.

 

Section
3.03 Validity of Security Interest. The security interest of the Borrower constitutes a legal, valid and enforceable
first priority security interest in the Collateral, securing the payment and performance of the Secured Obligations.

 

Section
3.04 Perfection of Security Interest under UCC 

 

(a)
All notifications and other actions, including, without limitation, (i) all deposits of certificates and instruments
evidencing any Collateral (duly endorsed or accompanied by appropriate instruments of transfer), (ii) all notices to and
acknowledgments of any Person, (iii) all acknowledgments and agreements respecting the right of the Secured Party to obtain
control with respect to any Collateral, (iv) the Delivery of the Pledged Equity Interests, and (v) all filings, registrations
and recordings, which are (x) required by the terms of this Agreement to have been given, made, obtained, done and
accomplished, and (y) necessary to create, preserve, protect and perfect the security interest granted by the Borrower to the
Secured Party hereby in respect of the Collateral, have been given, made, obtained, done and accomplished.

 

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(b)
After giving effect to all such actions, the security interest granted by the Borrower to the Secured Party pursuant to this
Agreement in and to the Collateral will be perfected to the maximum extent a security interest in the Collateral can be
perfected under the UCC of any applicable jurisdiction.

 

Section
3.05Places of Business; Jurisdiction of Organization; Locations of Collateral. The Borrower represents and warrants
that (i) the principal place of business of the Borrower, or its chief executive office, if it has more than one place of business,
is located at the address set forth in the introductory paragraph of this Agreement, and (ii) the jurisdiction of formation or
organization of the Borrower is set forth in the introductory paragraph of this Agreement.  

 

Section
3.06Collateral. Schedule 1 hereto sets forth a true and complete list of all of the Collateral pledged by the
Borrower as of the Closing Date. 

 

Section
3.07Securities Accounts

.
As of the Closing Date, the Borrower has no securities account to which Collateral has been credited.

 

Section
3.08Status of Collateral. All of the Pledged Equity Interests have been duly and validly issued and are fully paid
and non-assessable (to the extent such concepts are applicable). No Collateral is subject to any defense, offset or counterclaim,
nor have any of the foregoing been asserted or alleged against the Borrower by any Person. 

 

ARTICLE
IV.

GENERAL COVENANTS

 

Section
4.01No Other Liens; Defense of Title; Securities Accounts. The Borrower will not make or grant, or suffer or permit
to exist, any Lien on any of the Collateral, other than the Lien in favor of the Secured Party. The Borrower, at its sole cost
and expense, will take any and all actions reasonably necessary and appropriate to defend title to the Collateral against any
and all Persons and to defend the validity, enforceability, perfection, effectiveness and priority of the security interest of
the Secured Party therein against any other Lien. The Borrower will not have any securities accounts to which Collateral has been
credited other than a Controlled Securities Account.  

 

Section
4.02Further Assurances; Filings and Recordings 

 

(a)
The Borrower, at its sole cost and expense, will duly execute, acknowledge and deliver all such agreements, instruments and
other documents and take all such actions (including, without limitation, (i) physically pledging, if possible, the
Collateral with the Secured Party, (ii) obtaining Securities Account Control Agreements in accordance with this Agreement,
(iii) obtaining from other Persons agreements evidencing the exclusive control and dominion of the Secured Party over any of
the Collateral, in instances where obtaining control over such Collateral is the only or best method of perfection, (iv)
causing all Pledged Equity Interests to be Delivered to or for the benefit of the Secured Party to the extent a Securities
Account Control Agreement is not in effect with respect to such Pledged Equity Interests, and (v) making filings, recordings
and registrations, as the Secured Party may from time to time instruct to better assure, preserve, protect and perfect the
security interest of the Secured Party in the Collateral, and the rights and remedies of the Secured Party hereunder, or
otherwise to further effectuate the intent and purposes of this Agreement and to carry out the terms hereof.

 

    	 	- 6 -	 

    	 

    

 

(b)
The Borrower, at its sole cost and expense, will pay all taxes, fees and charges and comply with all statutes and regulations
applicable to such filing, recording, registration and publishing and such re-filing, re-recording, re-registration and
re-publishing.

 

Section
4.03Authorization to File Financing Statements. The Borrower irrevocably authorizes the Secured Party at any time and
from time to time to file in any jurisdiction any initial financing statements and all amendments thereto that (a) indicate the
Collateral with any description satisfactory to the Secured Party (in its sole discretion) and (b) contain any other information
required or permitted pursuant to the UCC for the sufficiency or filing office acceptance of any financing statement or amendment. 

 

Section
4.04Maintenance of Records. The Borrower will keep and maintain at its own cost and expense satisfactory and complete
records of the Collateral.  

 

Section
4.05Legal Status. The Borrower agrees that (a) it will not change its name, place of business or if more than one,
chief executive office, or its mailing address or organizational identification number if it has one, in each case without providing
the Secured Party at least thirty days’ prior written notice thereof, (b) if the Borrower does not have an organizational
identification number and later obtains one, it will promptly notify the Secured Party of such organizational identification number,
and (c) it will not change its type of organization, jurisdiction of organization or other legal structure in each case unless
it shall have provided the Secured Party at least thirty days’ prior written notice thereof. 

 

Section
4.06Inspections and Verification. The Secured Party and such Persons as the Secured Party may designate shall have
the right, at the Borrower’s own cost and expense, at any time or from time to time, to inspect the Collateral and all books
and records related thereto (and to make extracts and copies thereof) and to verify under reasonable procedures the validity,
amount, quality, quantity, value, condition and status of, or any other matter relating to, the Collateral. 

 

Section
4.07 Protective Advances by the Secured Party. At its option, but without being obligated to do so, the Secured Party
may, upon prior notice to the Borrower, after the occurrence and during the continuance of an Event of Default, (i) pay and discharge
past due taxes, assessments and governmental charges, at any time levied on or with respect to any of the Collateral with respect
to which the Borrower has failed to pay and discharge, and/or (ii) pay and discharge any claims of other creditors of the Borrower
which are secured by any Lien on any Collateral, other than the Lien in favor of the Secured Party, provided, however,
that nothing in this Section shall be construed as excusing the Borrower from the performance of, or imposing any obligation on
the Secured Party to cure or perform, any covenants or other agreements of the Borrower with respect to any of the foregoing matters
as set forth herein or in any of the other Loan Documents. 

 

ARTICLE
V.

SECURITIES ACCOUNTS

 

Section
5.01Securities Accounts. The Borrower shall cause all securities accounts in which any Collateral is deposited to be
subject at all times to a fully effective Securities Account Control Agreement, duly executed by the Borrower, the Secured Party
and the applicable Securities Intermediary.

 

    	 	- 7 -	 

    	 

    

 

ARTICLE
VI.

COLLATERAL

 

Section
6.01Delivery of Certificates and Instruments for Collateral 

 

(a)
On or prior to the Closing Date, the Borrower shall pledge and deposit with the Secured Party all certificates or
instruments, if any, representing any of the Collateral at the time owned by the Borrower and subject to the security
interest hereof, accompanied by undated transfer powers duly executed in blank by the Borrower or such other instruments of
transfer as are acceptable to the Secured Party.

 

(b)
If the Borrower shall acquire (by purchase, conversion, exchange, stock dividend or otherwise) any additional Collateral, at
any time or from time to time after the date hereof which is or are intended to be subjected to the security interest hereof
and which is or are represented by certificates or instruments, the Borrower shall forthwith pledge and deposit with the
Secured Party all such certificates, accompanied by undated transfer powers duly executed in blank by the Borrower or such
other instruments of transfer as are acceptable to the Secured Party.

 

(c)
Without limitation of any other provision of this Agreement, if any of the Collateral (whether or not now owned or hereafter
acquired) which is intended to be subjected to the security interest hereof is (i) an uncertificated security but hereafter
becomes a certificated security, the Borrower shall deliver such certificated securities to the Secured Party, accompanied by
undated transfer powers duly executed in blank, (ii) an uncertificated security, the Borrower shall cause such uncertificated
security to be subject to a Securities Account Control Agreement or subject to a Control Acknowledgement, and, if neither of
the foregoing methods of perfection are possible, Delivered to or for the benefit of the Secured Party, or (iii) held in a
securities account that is not already subject to a Securities Account Control Agreement, the Borrower shall promptly take
all actions required to make such securities account subject to a Securities Account Control Agreement, a Control
Acknowledgment or Delivered to or for the benefit of the Secured Party. The Borrower further agrees to take such actions as
the Secured Party deems reasonably necessary or desirable to effect the foregoing and to permit the Secured Party to exercise
any of its rights and remedies hereunder in respect thereof, promptly upon the request of the Secured Party.

 

Section
6.02No Assumption of Liability. Nothing herein shall be construed to make the Secured Party liable as a general partner,
limited partner, member or stockholder of Rhino, and the Secured Party by virtue of this Agreement or any actions taken as contemplated
hereby (except as referred to in the following sentence) shall not have any of the duties, obligations or liabilities of a general
partner, limited partner, member or stockholder of Rhino. The parties hereto expressly agree that, unless the Secured Party shall
become the absolute owner of an Pledge Equity Interest pursuant hereto, this Agreement shall not be construed as creating a partnership
or joint venture between the Secured Party and/or the Borrower or any other Person.  

 

Section
6.03Registration of Collateral in the Name of the Secured Party. Upon the occurrence of an Event of Default, the Secured
Party shall have the right, at any time in its discretion and without notice to the Borrower, to transfer to or to register in
the name of the Secured Party or any of its nominees any or all of the Collateral, subject only to the revocable voting and similar
rights specified in this Article VI, if perfection of the Lien on the Collateral was accomplished by any means other than Delivery.
In addition, upon the occurrence of an Event of Default, the Secured Party shall have the right at any time to exchange certificates
or instruments representing or evidencing any Collateral for certificates or instruments of smaller or larger denominations.

 

    	 	- 8 -	 

    	 

    

 

Section
6.04Appointment of Sub-Agents; Endorsements; etc. The Secured Party shall have the right to appoint one or more sub-agents
for the purpose of retaining physical possession of the instruments and certificates evidencing any of the Collateral, which may
be held (in the sole discretion of the Secured Party) in the name of the Borrower, endorsed or assigned in blank or in favor of
the Secured Party or any nominee or nominees of the Secured Party or a sub-agent appointed by the Secured Party. 

 

Section
6.05Voting Rights. Unless and until an Event of Default shall have occurred and be continuing, the Borrower shall be
entitled to exercise all voting rights attaching to any and all Collateral owned by it, and to give consents, waivers or ratifications
in respect thereof, provided that no vote shall be cast or any consent, waiver or ratification given or any action taken
which would violate, result in breach of any covenant contained in or be inconsistent with any of the terms of this Agreement
or any other Loan Document, or which would have the effect of impairing the position or interests of the Secured Party therein.
All such rights of the Borrower to vote and to give consents, waivers and ratifications shall cease in case an Event of Default
shall occur and be continuing. 

 

Section
6.06Entitlement of the Borrower to Cash Dividends and Distributions. The Borrower shall be entitled to receive all
cash dividends or distributions payable in respect of its Collateral, except as otherwise provided in this Article VI. 

 

Section
6.07Entitlement of Administrative Agent to Dividends and Distributions. The Secured Party shall be entitled to receive
and to retain as part of the Collateral: 

 

(a)
all cash dividends and distributions payable in respect of the Collateral at any time when an Event of Default shall have
occurred and be continuing; and

 

(b)
regardless of whether or not an Event of Default shall have occurred and be continuing at the time of payment or distribution
thereof: (i) all cash dividends and distributions in respect of the Collateral which are reasonably determined by the Secured
Party to represent in whole or in part an extraordinary, liquidating or other distribution in return of capital; (ii) all
other or additional securities, partnership interests, membership interests or property (other than cash to which the
Borrower is entitled under Section 6.06) paid or distributed by way of dividend (including, without limitation, any payment
in kind dividend) or otherwise in respect of the Collateral; (iii) all other or additional securities, partnership interests,
membership interests or property (including cash) paid or distributed in respect of the Collateral by way of stock split,
spin-off, split up, reclassification, combination of shares or similar rearrangement; and (iv) all other or additional
securities, partnership interests, membership interests or property (including cash) which may be paid in respect of the
Collateral by reason of any consolidation, merger, exchange of stock, conveyance of assets, liquidation or similar corporate,
partnership or limited liability company reorganization.

 

Section
6.08Application of Dividends and Distributions. If no Event of Default shall have occurred and be continuing at such
time, the Secured Party will, at the request of the Borrower, apply to the payment or prepayment of any of the Secured Obligations,
any cash held by it as Collateral which is attributable to dividends or distributions received by it and then held as part of
the Collateral pursuant to this Article VI. If an Event of Default shall have occurred and be continuing, all dividends and distributions
received by the Secured Party and then held by it pursuant to this Article VI as part of the Collateral will be applied as provided
in Section 7.05 hereof. 

 

Section
6.09Turnover by the Borrower. All dividends, distributions or other payments that are received by the Borrower contrary
to the provisions of this Agreement shall be received in trust for the benefit of the Secured Party, shall be segregated from
other property or funds of the Borrower and shall be forthwith paid over to the Secured Party as Collateral in the same form as
so received (with any necessary endorsement).

 

    	 	- 9 -	 

    	 

    

 

Section
6.10Sale of Pledged Equity Interests in Connection with Enforcement. If at any time when the Secured Party shall determine
to exercise its right to sell all or any part of the Pledged Equity Interests pursuant to Section 7.01, such Pledged Equity Interests
or the part thereof to be sold shall not, for any reason whatsoever, be effectively registered under the Securities Act, the Secured
Party may, in its sole and absolute discretion and to the fullest extent permitted by applicable law now or hereafter in effect,
sell such Pledged Equity Interests or part thereof by private sale in such manner and under such circumstances as the Secured
Party may deem necessary or advisable in order that such sale may legally be effected without such registration such that the
Note and all amounts, interest and penalties due thereunder may be satisfied, provided that at least ten days’ notice of
the time and place of any such sale shall be given to the Borrower; it being further agreed that after said ten days’ notice
the Secured Party may sell or otherwise market the Pledged Equity Interests in any lawful manner. Without limiting the generality
of the foregoing, in any such event the Secured Party, in its sole and absolute discretion, (a) may proceed to make such private
sale notwithstanding that a registration statement for the purpose of registering such Pledged Equity Interests or part thereof
shall have been filed under such Securities Act, (b) may approach and negotiate with a single possible purchaser to effect such
sale and (c) may restrict such sale to a purchaser who will represent and agree that such purchaser is purchasing for its own
account, for investment, and not with a view to the distribution or sale of such Pledged Equity Interests or part thereof. In
the event of any such sale, the Secured Party shall incur no responsibility or liability to the Borrower for selling all or any
part of the Pledged Equity Interests at a price which the Secured Party may in good faith deem reasonable under the circumstances,
notwithstanding the possibility that a substantially higher price might be realized if the sale were deferred until the registration
as aforesaid. 

 

ARTICLE
VII.

REMEDIES UPON OCCURRENCE OF EVENT OF DEFAULT

 

Section
7.01Remedies Generally. The Borrower agrees that, if any Event of Default shall have occurred and be continuing, then
and in every such case, subject to any mandatory requirements of applicable law then in effect, the Secured Party, in addition
to any rights now or hereafter existing under applicable law, shall have all rights as a secured creditor under the UCC in all
relevant jurisdictions and may exercise any or all of the following rights (all of which the Borrower hereby agrees is commercially
reasonable to the fullest extent permitted under applicable law now or hereafter in effect): 

 

(a)
personally, or by agents’ attorneys or other authorized representatives, immediately retake possession of the
Collateral or any part thereof from the Borrower or any other Person who then has possession of any part thereof with or
without notice or process of law, and for that purpose may enter upon the Borrower’s or such other Person’s
premises where any of the Collateral is located and remove the same;

 

(b)
sell, assign or otherwise liquidate, or direct the Borrower to sell, assign or otherwise liquidate, any or all of the
Collateral or any part thereof, and take possession of the proceeds of any such sale or liquidation;

 

(c)
issue a Notice of Exclusive Control with respect to any or all of the Collateral Accounts and issue entitlement orders or
instructions with respect thereto;

 

(d)
withdraw any or all securities and/or instruments in any Controlled Securities Account for application to the Secured
Obligations in accordance with Section 7.05 hereof;

 

    	 	- 10 -	 

    	 

    

 

(e)
pay and discharge taxes, Liens or claims on or against any of the Collateral;

 

(f)
pay, perform or satisfy, or cause to be paid, performed or satisfied, for the benefit of the Borrower, any of the
obligations, terms, covenants, provisions or conditions to be paid, observed, performed or satisfied by the Borrower under
any contract, agreement or instrument relating to its Collateral, all in accordance with the terms, covenants, provisions and
conditions thereof, as and to the extent that the Borrower fails or refuses to perform or satisfy the same;

 

(g)
enter into any extension of, or any other agreement in any way relating to, any of the Collateral;

 

(h)
make any compromise or settlement the Secured Party deems desirable or necessary with respect to any of the Collateral;
and/or

 

(i)
take possession of the Collateral or any part thereof, by directing the Borrower or any other Person in possession thereof in
writing to deliver the same to the Secured Party at any place or places designated by the Secured Party, in which event the
Borrower shall at its own expense.

 

Section
7.02Disposition of the Collateral. Upon the occurrence and continuance of an Event of Default, any Collateral repossessed
by the Secured Party under or pursuant to Section 7.01 and any other Collateral whether or not so repossessed by the Secured Party,
may be sold, assigned, leased or otherwise disposed of under one or more contracts or as an entirety, and without the necessity
of gathering at the place of sale of the property to be sold, and in general in such manner, at such time or times, at such place
or places and on such terms as the Secured Party may, in compliance with any mandatory requirements of applicable law, determine
to be commercially reasonable. Any of the Collateral may be sold, leased or otherwise disposed of, in the condition in which the
same existed when taken by the Secured Party or after any overhaul or repair which the Secured Party shall determine to be commercially
reasonable. Except in the case of any Collateral that is perishable or threatens to decline speedily in value or is of a type
customarily sold on a recognized market, (i) in the case of any such disposition which shall be a private sale or other private
proceedings permitted by such requirements, such sale shall be made upon not less than ten days’ written notice to the Borrower
specifying the time at which such disposition is to be made and the intended sale price or other consideration therefor, and shall
be subject, for the ten days after the giving of such notice, to the right of the Borrower or any nominee of the Borrower to acquire
the Collateral involved at a price or for such other consideration at least equal to the intended sale price or other consideration
so specified, and (ii) in the case of any such disposition which shall be a public sale permitted by such requirements, such sale
shall be made upon not less than ten days’ written notice to the Borrower specifying the time and place of such sale and,
in the absence of applicable requirements of law, shall be by public auction (which may, at the Secured Party’s sole option,
be subject to reserve), after publication of notice of such auction not less than ten days prior thereto in two newspapers in
general circulation in the city where such Collateral is located. To the extent permitted by any such requirement of law, the
Secured Party may bid for and become the purchaser (by bidding in Secured Obligations or otherwise) of the Collateral or any item
thereof offered for sale in accordance with this Section without accountability to the Borrower (except to the extent of surplus
money received as provided in Section 7.05). Unless so obligated under mandatory requirements of applicable law, the Secured Party
shall not be required to make disposition of the Collateral within a period of time which does not permit the giving of notice
to the Borrower as hereinabove specified. The Secured Party need give the Borrower only such notice of disposition as the Secured
Party shall deem to be reasonably practicable in view of such mandatory requirements of applicable law.

 

    	 	- 11 -	 

    	 

    

 

Section
7.03Waiver of Claims. Except as otherwise provided in this Agreement, THE BORROWER HEREBY WAIVES, TO THE EXTENT PERMITTED
BY APPLICABLE LAW, NOTICE AND JUDICIAL HEARING IN CONNECTION WITH THE SECURED PARTY’S TAKING POSSESSION OR THE SECURED PARTY’S
DISPOSITION OF ANY OF THE COLLATERAL, INCLUDING, WITHOUT LIMITATION, ANY AND ALL PRIOR NOTICE AND HEARING FOR ANY PREJUDGMENT
REMEDY OR REMEDIES AND ANY SUCH RIGHT WHICH THE BORROWER WOULD OTHERWISE HAVE UNDER THE CONSTITUTION OR ANY STATUTE OF THE UNITED
STATES OR OF ANY STATE, and the Borrower hereby further waives, to the extent permitted by law: (i) all damages occasioned by
such taking of possession except any damages which are the direct result of the Secured Party’s gross negligence or willful
misconduct; (ii) all other requirements as to the time, place and terms of sale or other requirements with respect to the enforcement
of the Secured Party’s rights hereunder; and (iii) all rights of redemption, appraisement, valuation, stay, extension or
moratorium now or hereafter in force under any applicable law in order to prevent or delay the enforcement of this Agreement or
the absolute sale of the Collateral or any portion thereof, and the Borrower, for itself and all who may claim under it, insofar
as it or they now or hereafter lawfully may, hereby waives the benefit of all such laws to the fullest extent permitted by applicable
law now or hereafter in effect. Any sale of, or the grant of options to purchase, or any other realization upon, any Collateral
shall operate to divest all right, title, interest, claim and demand, either at law or in equity, of the Borrower therein and
thereto, and shall be a perpetual bar both at law and in equity against the Borrower and against any and all Persons claiming
or attempting to claim the Collateral so sold, optioned or realized upon, or any part thereof, from, through and under the Borrower. 

 

Section
7.04Application of Proceeds. All Collateral and proceeds of Collateral obtained and realized by the Secured Party in
connection with the enforcement of this Agreement pursuant to this Article VII shall be applied as follows: 

 

(i) first,
to the payment to the Secured Party, for application to the Secured Obligations in such order as the Secured Party
determines in its sole discretion; and

 

(ii) second,
to the extent remaining after the application pursuant to the preceding clause (i) and following the termination of this
Agreement, to the Borrower or to whomever may be lawfully entitled to receive such payment.

 

Section
7.05Remedies Cumulative. Each and every right, power and remedy hereby specifically given to the Secured Party shall
be in addition to every other right, power and remedy specifically given under this Agreement or the other Loan Documents or now
or hereafter existing at law or in equity, or by statute, and each and every right, power and remedy whether specifically herein
given or otherwise existing may be exercised from time to time or simultaneously and as often and in such order as may be deemed
expedient by the Secured Party. All such rights, powers and remedies shall be cumulative and the exercise or the beginning of
exercise of one shall not be deemed a waiver of the right to exercise any other or others. No delay or omission of the Secured
Party in the exercise of any such right, power or remedy, or partial or single exercise thereof, and no renewal or extension of
any of the Secured Obligations, shall impair or constitute a waiver of any such right, power or remedy or shall be construed to
be a waiver of any Event of Default or an acquiescence therein. No notice to or demand on the Borrower in any case shall entitle
it to any other or further notice or demand in similar or other circumstances or constitute a waiver of any of the rights of the
Secured Party to any other or further action in any circumstances without notice or demand. In the event that the Secured Party
shall bring any suit to enforce any of its rights hereunder and shall be entitled to judgment, then in such suit the Secured Party
may recover reasonable, actual expenses, including attorneys’ fees, and the amounts thereof shall be included in such judgment.

 

    	 	- 12 -	 

    	 

    

 

Section
7.06Discontinuance of Proceedings. In case the Secured Party shall have instituted any proceeding to enforce any right,
power or remedy under this Agreement by foreclosure, sale, entry or otherwise, and such proceeding shall have been discontinued
or abandoned for any reason or shall have been determined adversely to the Secured Party, then and in every such case the Borrower,
the Secured Party and each holder of any of the Secured Obligations shall be restored to their former positions and rights hereunder
with respect to the Collateral subject to the security interest created under this Agreement, and all rights, remedies and powers
of the Secured Party shall continue as if no such proceeding had been instituted. 

 

Section
7.07Purchasers of Collateral. Upon any sale of any of the Collateral by the Secured Party hereunder (whether by virtue
of the power of sale herein granted, pursuant to judicial process or otherwise), the receipt of the Secured Party or the officer
making the sale shall be a sufficient discharge to the purchaser or purchasers of the Collateral so sold, and such purchaser or
purchasers shall not be obligated to see to the application of any part of the purchase money paid over to the Secured Party or
such officer or be answerable in any way for the misapplication or nonapplication thereof. 

 

ARTICLE
VIII.

MISCELLANEOUS

 

Section
8.01Notices. Except as otherwise expressly provided herein, all notices and other communications provided for hereunder
shall be given as provided in the Note.  

 

Section
8.02Entire Agreement. This Agreement, the Note, the Securities Account Control Agreement and the other Loan Documents
represent the final agreement among the parties with respect to the subject matter hereof and thereof, supersede any and all prior
agreements and understandings, oral or written, relating to the subject matter hereof and thereof, and may not be contradicted
by evidence of prior, contemporaneous or subsequent oral agreements among the parties. There are no unwritten oral agreements
among the parties. 

 

Section
8.03Obligations Absolute. The obligations of the Borrower under this Agreement shall be absolute and unconditional
and shall remain in full force and effect without regard to, and shall not be released, suspended, discharged, terminated or otherwise
affected by, any circumstance or occurrence whatsoever, other than indefeasible payment in full of, and complete performance of,
all of the Secured Obligations, including, without limitation: 

 

(a)
any renewal, extension, amendment or modification of, or addition or supplement to, or deletion from other Loan Documents, or
any other instrument or agreement referred to therein, or any assignment or transfer of any thereof;

 

(b)
any waiver, consent, extension, indulgence or other action or inaction under or in respect of any such agreement or
instrument or this Agreement except as expressly provided in such renewal, extension, amendment, modification, addition,
supplement, assignment or transfer;

 

(c)
any furnishing of any additional security to the Secured Party or its assignee or any acceptance thereof or any release of
any security by the Secured Party or its assignee;

 

(d)
any limitation on any Person’s liability or obligations under any such instrument or agreement or any invalidity or
unenforceability, in whole or in part, of any such instrument or agreement or any term thereof;

 

    	 	- 13 -	 

    	 

    

 

(e)
any bankruptcy, insolvency, reorganization, composition, adjustment, dissolution, liquidation or other like proceeding
relating to the Borrower or any Subsidiary of the Borrower, or any action taken with respect to this Agreement by any trustee
or receiver, or by any court, in any such proceeding, whether or not the Borrower shall have notice or knowledge of any of
the foregoing; or

 

(f)
to the fullest extent permitted by applicable law now or hereafter in effect, any other event or circumstance which, but for
this provision, might release or discharge a guarantor or other surety from its obligations as such.

 

Section
8.04Successors and Assigns. This Agreement shall be binding upon the Borrower and its successors and assigns and shall
inure to the benefit of the Secured Party and its successors and assigns, provided that the Borrower may not transfer or
assign any or all of its rights or obligations hereunder without the written consent of the Secured Party. All agreements, statements,
representations and warranties made by the Borrower herein or in any certificate or other instrument delivered by the Borrower
or on its behalf under this Agreement shall be considered to have been relied upon by the Secured Party and shall survive the
execution and delivery of this Agreement and the other Loan Documents regardless of any investigation made by the Secured Party
or on its behalf. 

 

Section
8.05Headings Descriptive. The headings of the several Sections of this Agreement are inserted for convenience only
and shall not in any way affect the meaning or construction of any provision of this Agreement. 

 

Section
8.06Severability. Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as
to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable
such provision in any other jurisdiction. 

 

Section
8.07Enforcement Expenses, etc. The Borrower hereby agrees to pay all out-of-pocket costs and expenses of the Secured
Party in connection with the enforcement of this Agreement, the preservation of the Collateral, the perfection of the security
interest, and any amendment, waiver or consent relating hereto. 

 

Section
8.08Termination. After the Secured Obligations have been paid in full, this Agreement shall terminate, and the Secured
Party, at the request and expense of the Borrower, will execute and deliver to the Borrower a proper instrument or instruments
(including UCC termination statements on form UCC-3) acknowledging the satisfaction and termination of this Agreement, and will
duly assign, transfer and deliver to the Borrower (without recourse and without any representation or warranty) such of the Collateral
as may be in the possession of the Secured Party and as has not theretofore been sold or otherwise applied or released pursuant
to this Agreement. 

 

Section
8.09Other Creditors, etc. Not Third-Party Beneficiaries. No creditor of the Borrower or any of its Affiliates, or other
Person claiming by, through or under the Borrower or any of its Affiliates, other than the Secured Party, and their respective
successors and assigns, shall be a beneficiary or third-party beneficiary of this Agreement or otherwise shall derive any right
or benefit herefrom. 

 

Section
8.10Counterparts. This Agreement may be executed in any number of counterparts and by different parties hereto on separate
counterparts, including via facsimile transmission or other electronic transmission capable of authentication, each of which when
so executed and delivered shall be an original, but all of which shall together constitute one and the same agreement. A set of
counterparts executed by all the parties hereto shall be lodged with the Borrower and the Secured Party.

 

    	 	- 14 -	 

    	 

    

 

Section
8.11Amendments. No amendment or waiver of any provision of this Agreement and no consent to any departure by the Borrower
shall in any event be effective unless the same shall be in writing and signed by the Secured Party and the Borrower, and then
such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given.  

 

Section
8.12Separate Actions. A separate action may be brought and prosecuted against the Borrower or any other guarantor or
obligor whether or not any other guarantor or obligor or the Borrower be joined in such action or actions. 

 

Section
8.13Full Recourse Obligations; Effect of Fraudulent Transfer Laws. It is the desire and intent of the Borrower and
the Secured Party that this Agreement shall be enforced as a full recourse obligation of the Borrower to the fullest extent permissible
under the laws and public policies applied in each jurisdiction in which enforcement is sought. If and to the extent that the
obligations of the Borrower under this Agreement would, in the absence of this sentence, be adjudicated to be invalid or unenforceable
because of any applicable state or federal law relating to fraudulent conveyances or transfers, then the amount of the Borrower
liability hereunder in respect of the Secured Obligations shall be deemed to be reduced ab initio to that maximum amount
that would be permitted without causing the Borrower’s obligations hereunder to be so invalidated. 

 

Section
8.14Governing Law; Venue; Waiver of Jury Trial 

 

(a)
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW
OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES.

 

(b)
ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK SITTING
IN NEW YORK CITY OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF SUCH STATE, AND BY EXECUTION AND DELIVERY OF THIS
AGREEMENT, THE BORROWER CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE EXCLUSIVE JURISDICTION OF THOSE COURTS.
THE BORROWER IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM
NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN
RESPECT OF THIS AGREEMENT OR OTHER DOCUMENT RELATED THERETO. THE BORROWER WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT
OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY THE LAW OF SUCH STATE.

 

(c)
THE BORROWER HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER
THIS AGREEMENT OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM
WITH RESPECT TO THIS AGREEMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING,
AND WHETHER FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND THE BORROWER HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM,
DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY
FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION 8.14 WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE
SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

 

    	 	- 15 -	 

    	 

    

 

[Remainder
of page intentionally left blank]

 

    	 	- 16 -	 

    	 

    

 

IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed and delivered by their duly authorized officers
as of the date first above written.

 

	 	ROYAL ENERGY RESOURCES, INC., as the 
	 	Borrower
	 	 	 
	 	By:	               
	 	Name:	 
	 	Title:	 

 

	Accepted by:	 
	 	 
	CEDARVIEW OPPORTUNITIES MASTER FUND, L.P., as the Secured Party	 
	 	 
	By:Burton Weinstein _____________, its general partner
	 	 	 
	By:	                	 
	Name:	 	 
	Title:	 	 

 

    	 	 	 

    	 

    

 

Schedule
1

 

Collateral

 

	Issuer and Type of
 Organization
	 	Certificate Number	 	Number of Shares,
 Units, Etc.
	 	 	Type
                                         of Equity
 Interest
	 	Percent of
 Equity Interest
 Pledged
	 
	Rhino Resource Partners LP 
Limited partnership	 	N/A	 	 	4,960,766	 	 	Common Unit (unregistered)	 	 	100	%
	Rhino Resource Partners LP 
Limited partnership	 	N/A	 	 	39,234	 	 	Common Unit (registered)	 	 	100	%

 

    	 	 	 

    	 

    

 

 

 

PLEDGE
AND SECURITY AGREEMENT

 

dated
as of

 

September
30, 2016

 

by

 

ROYAL
ENERGY RESOURCES, INC.,

 

as
the Borrower,

 

for
the benefit of

 

WESTON
ENERGY LLC

 

 

 

    	 	 	 

    	 

    

 

Table
of Contents

 

	 	Page
	ARTICLE
    I. DEFINITIONS AND TERMS	1
	 	Section
    1.01   Defined Terms	1
	 	Section
    1.02   Additional Defined Terms	1
	 	Section
    1.03   Terms Generally	3
	 	 	 
	ARTICLE
    II. SECURITY INTEREST	4
	 	Section
    2.01   Grant of Security Interest	4
	 	Section
    2.02   No Assumption of Liability	4
	 	Section
    2.03   Power of Attorney	4
	 	 	 
	ARTICLE
    III. REPRESENTATIONS AND WARRANTIES	5
	 	Section
    3.01   Title and Authority	5
	 	Section
    3.02   Absence of Other Liens	5
	 	Section
    3.03   Validity of Security Interest	5
	 	Section
    3.04   Perfection of Security Interest under UCC	5
	 	Section
    3.05   Places of Business; Jurisdiction of Organization; Locations of Collateral	6
	 	Section
    3.06   Collateral	6
	 	Section
    3.07   Securities Accounts	6
	 	Section
    3.08   Status of Collateral	6
	 	 	 
	ARTICLE
    IV. GENERAL COVENANTS	6
	 	Section
    4.01   No Other Liens; Defense of Title; Securities Accounts	6
	 	Section
    4.02   Further Assurances; Filings and Recordings	6
	 	Section
    4.03   Authorization to File Financing Statements	7
	 	Section
    4.04   Maintenance of Records	7
	 	Section
    4.05   Legal Status	7
	 	Section
    4.06   Inspections and Verification	7
	 	Section
    4.07   Protective Advances by the Secured Party	7
	 	 	 
	ARTICLE
    V. SECURITIES ACCOUNTS	7
	 	Section
    5.01   Securities Accounts	7

 

    	 	 i	 

    	 

    

 

Table of Contents

(continued)

 

	 	Page
	ARTICLE
    VI. COLLATERAL	8
	 	Section
    6.01   Delivery of Certificates and Instruments for Collateral	8
	 	Section
    6.02   No Assumption of Liability	8
	 	Section
    6.03   Registration of Collateral in the Name of the Secured Party	8
	 	Section
    6.04   Appointment of Sub-Agents; Endorsements; etc.	9
	 	Section
    6.05   Voting Rights	9
	 	Section
    6.06   Entitlement of the Borrower to Cash Dividends and Distributions	9
	 	Section
    6.07   Entitlement of Administrative Agent to Dividends and Distributions	9
	 	Section
    6.08   Application of Dividends and Distributions	9
	 	Section
    6.09   Turnover by the Borrower	9
	 	Section
    6.10   Sale of Pledged Equity Interests in Connection with Enforcement	10
	 	 	 
	ARTICLE
    VII. REMEDIES UPON OCCURRENCE OF EVENT OF DEFAULT	10
	 	Section
    7.01   Remedies Generally	10
	 	Section
    7.02   Disposition of the Collateral	11
	 	Section
    7.03   Waiver of Claims	11
	 	Section
    7.04   Application of Proceeds	12
	 	Section
    7.05   Remedies Cumulative	12
	 	Section
    7.06   Discontinuance of Proceedings	12
	 	Section
    7.07   Purchasers of Collateral	13
	 	 	 
	ARTICLE
    VIII. MISCELLANEOUS	13
	 	Section
    8.01   Notices	13
	 	Section
    8.02   Entire Agreement	13
	 	Section
    8.03   Obligations Absolute	13
	 	Section
    8.04   Successors and Assigns	14
	 	Section
    8.05   Headings Descriptive	14
	 	Section
    8.06   Severability	14
	 	Section
    8.07   Enforcement Expenses, etc.	14
	 	Section
    8.08   Termination	14
	 	Section
    8.09   Other Creditors, etc. Not Third-Party Beneficiaries	14
	 	Section
    8.10   Counterparts	14
	 	Section
    8.11   Amendments	15
	 	Section
    8.12   Separate Actions	15
	 	Section
    8.13   Full Recourse Obligations; Effect of Fraudulent Transfer Laws	15
	 	Section
    8.14   Governing Law; Venue; Waiver of Jury Trial	15

 

End
of TOC - Do not delete this paragraph!

 

    	 	 iiExhibit

INDEMNIFICATION AGREEMENT

THIS INDEMNIFICATION AGREEMENT, dated as of _______________, 2017 (this “Agreement”), is made by and between Resource Capital Corp., a Maryland corporation (the “Company”), and __________________________ (“Indemnitee”).
WHEREAS, the charter of the Company (the “Charter”) and the Bylaws, as amended from time to time, of the Company (the “Bylaws”) provide for indemnification by the Company of its directors and officers as provided therein, and Indemnitee has been serving and continues to serve as a director and/or officer of the Company partly in reliance on such provision;
WHEREAS, to provide Indemnitee with additional contractual assurance of protection against personal liability in connection with certain proceedings described below, the Company desires to enter into this Agreement;
WHEREAS, in order to induce Indemnitee to serve or continue to serve as a director and/or officer of the Company and in consideration of Indemnitee’s so serving, the Company desires to indemnify Indemnitee and to make arrangements pursuant to which Indemnitee may be advanced or reimbursed expenses incurred by Indemnitee in certain proceedings described below, according to the terms and conditions set forth below;
NOW, THEREFORE, the Company and Indemnitee, intending to be legally bound, hereby agree as follows:
1.    (a)    Third-Party Proceedings.  The Company shall indemnify Indemnitee to the maximum extent permitted by Maryland law, except as otherwise provided in Section 3 of this Agreement, if Indemnitee is or was a party or is threatened to be made a party to any threatened, pending or completed suit, action, claim, proceeding, arbitration or alternative dispute resolution mechanism, investigation, administrative hearing, whether civil, criminal, administrative or investigative (any such suit, action, proceeding, arbitration or alternative dispute resolution mechanism, investigation or administrative hearing being referred to herein as a “Proceeding”) (other than an action by or in the right of the Company or any Subsidiary (as defined below) of the Company) by reason of the fact that Indemnitee is or was an officer, director, employee or agent of the Company or any subsidiary or affiliated entity (each, a “Subsidiary”) of the Company, by reason of any action or inaction on the part of Indemnitee while an officer, director, employee or agent of the Company or any Subsidiary of the Company or by reason of the fact that Indemnitee is or was serving at the request of the Company as an officer, director, employee or agent of another Person (as defined in Section 5(d)), against expenses (including reasonable attorneys’ fees, investigation expenses, expert witnesses’ and other expenses), judgments, fines and amounts paid in settlement (if such settlement is approved in advance by the Company, which approval shall not be unreasonably withheld) actually and reasonably incurred by Indemnitee in connection with the defense and/or settlement of such Proceeding (collectively, “Expenses”) if Indemnitee (i) acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company and its stockholders, (ii) did not actually receive an improper personal benefit in money, property or services and (iii) with 

respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful.
(b)    Proceedings by or in the Right of the Company or any Subsidiary.  The Company shall indemnify Indemnitee to the maximum extent permitted by Maryland law, except as otherwise provided in Section 3 of this Agreement, if Indemnitee is or was a party or is threatened to be made a party to any threatened, pending or completed Proceeding by or in the right of the Company or any Subsidiary of the Company by reason of the fact that Indemnitee is or was an officer, director, employee or agent of the Company or any Subsidiary of the Company or by reason of the fact that Indemnitee is or was serving at the request of the Company as an officer, director, employee or agent of another Person, against Expenses in each case to the extent actually and reasonably incurred by Indemnitee if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in or not opposed to the best interests of the Company and its stockholders, provided that no indemnification shall be made in respect of any Proceeding as to which Indemnitee shall have been adjudged to be liable to the Company and its stockholders unless and only to the extent that the Circuit Court of the State of Maryland, or the court in which such Proceeding shall have been brought or is pending, shall determine that in view of all the circumstances of the case, Indemnitee is fairly and reasonably entitled to indemnity for expenses, and then only to the extent that the court shall determine.
(c)    Selection of Counsel.  If the Company shall be obligated under Section 1(a) or (b) hereof to pay Expenses of Indemnitee, the Company shall be entitled to assume the defense of such Proceeding, with counsel approved by Indemnitee (who shall not unreasonably withhold such approval), upon the delivery to Indemnitee of written notice of its election to do so.  After delivery of such notice, approval of such counsel by Indemnitee and the retention of such counsel by the Company, the Company will not be liable to Indemnitee under this Agreement for any fees of counsel subsequently incurred by Indemnitee with respect to the same Proceeding, provided that, (i) Indemnitee shall have the right to employ his or her counsel in any such proceeding at Indemnitee’s expense; and (ii) if (A) the employment of counsel by Indemnitee has been previously authorized in writing by the Company, (B) Indemnitee shall have reasonably concluded that there may be a conflict of interest between the Company and Indemnitee in the conduct of any such defense and shall have notified the Company in writing thereof, (C) Indemnitee shall have reasonably concluded that there may be a conflict of interest between Indemnitee and other indemnitees of the Company being represented by counsel retained by the Company in the same Proceeding and shall have notified the Company in writing thereof, or (D) the Company shall not, in fact, have employed counsel to assume the defense of such Proceeding within a reasonable time frame, then the reasonable fees and expenses of Indemnitee’s counsel shall be at the expense of the Company.
2.    Contribution.  If, when Indemnitee has met the applicable standard of conduct, the indemnification provisions set forth in Section 1 should, under applicable law, be to any extent unenforceable, then the Company agrees that it shall be treated as though it is or was a party to the threatened, pending or completed Proceeding in which Indemnitee is or was involved and that the Company shall contribute to the amounts paid or payable by Indemnitee as a result of 

2

Expenses in third-party Proceedings in such proportion as is appropriate to reflect the relative fault of the Company on the one hand and Indemnitee on the other in connection with such action or inaction, or alleged action or inaction, as well as any other relevant equitable considerations.
For purposes of this Section 2, the relative fault shall be determined by reference to, among other things, the fault of the Company and all of its directors, officers, employees and agents (other than Indemnitee), as a group and treated as one entity, and such group’s relative intent, knowledge, access to information and opportunity to have altered or prevented the action or inaction, or alleged action or inaction, forming the basis for the threatened, pending or contemplated Proceeding, and Indemnitee’s relative fault in light of such factors on the other hand.
3.    Limitations to Rights of Indemnification and Advancement of Expenses.  Except as otherwise provided in Section 9 of this Agreement, Indemnitee shall not be entitled to indemnification or advancement of Expenses (collectively, “Indemnified Amounts”) under this Agreement:
(a)    with respect to any Proceeding initiated, brought or made by or on behalf of Indemnitee (i) against the Company, unless a Change in Control (as defined in Section 3(h) of this Agreement) shall have occurred, or (ii) against any Person other than the Company, unless approved in advance by the Board of Directors of the Company (the “Board”);
(b)    on account of any Proceeding in which it shall be determined by final judgment by a court having jurisdiction in the matter that Indemnitee intentionally caused or intentionally contributed to the injury complained of, with the knowledge that such injury would occur;
(c)    on account of Indemnitee’s conduct which shall be determined by final judgment by a court having jurisdiction in the matter that Indemnitee was knowingly fraudulent, deliberately dishonest or engaged in willful misconduct or that Indemnitee received an improper personal benefit in money, property or services;
(d)    with respect to any Proceeding instituted by Indemnitee to enforce or interpret this Agreement, to the extent that a court of competent jurisdiction determines that any of the material assertions made by Indemnitee in such Proceeding was not made in good faith or was frivolous;
(e)    for any Indemnified Amounts or other amounts which have been paid to Indemnitee by an insurance carrier under a policy of officers’ and directors’ liability insurance maintained by the Company;
(f)    if the Company has a class of equity securities registered pursuant to Section 12 of the Exchange Act (as hereinafter defined), for any Indemnified Amounts or the payment of profits arising from the purchase and sale by Indemnitee of securities in violation of 

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Section 16(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or any similar successor statute; or
(g)    if it shall be determined by final judgment by a court having jurisdiction in the matter that such indemnification is not lawful.
(h)    “Change in Control” means the occurrence of any of the following events:
(i)    the Company is merged, consolidated or reorganized into or with another corporation or other entity and, as a result of such merger, consolidation or reorganization, less than a majority of the combined voting power of the then-outstanding securities of such corporation or entity immediately after such transaction are held in the aggregate by the holders of voting stock immediately prior to such transaction;
(ii)    the Company sells or otherwise transfers all or substantially all of its assets to another corporation or other entity in which, after giving effect to such sale or transfer, the holders of voting stock of the Company immediately prior to such sale or transfer hold in the aggregate less than a majority of the combined voting power of the then-outstanding securities of such other corporation;
(iii)    if the Company has a class of equity securities registered pursuant to Section 12 of the Exchange Act, there is a report filed on Schedule 13D or Schedule TO (or any successor schedule, form or report or item therein), each as promulgated pursuant to the Exchange Act, disclosing that any person or entity, other than any stockholder of the Company (and its Affiliates) owning 10% or more of the Company’s voting stock on the date hereof, has become the beneficial owner (as the term “beneficial owner” is defined under Rule 13d-3 or any successor rule or regulation promulgated under the Exchange Act) of securities representing 50% or more of the combined voting power of the Company’s voting stock; or
(iv)    if, during any period of two (2) consecutive years, individuals who at the beginning of any such period constitute the Board cease for any reason to constitute at least a majority thereof; provided, however, that for purposes of this clause (iv) each director of the Company who is first elected, or first nominated for election by the Company’s stockholders, by a vote of at least a majority of the directors of the Company (or a committee of the Board) then still in office who were directors of the Company at the beginning of any such period shall be deemed to have been a director of the Company at the beginning of such period.
Notwithstanding the provisions of clause (iii) above, unless otherwise determined in the specific case by majority vote of the Board, a “Change in Control” shall not be deemed to have occurred solely because the Company, any Subsidiary or any employee stock ownership plan or other employee benefit plan of the Company or any Subsidiary either files or becomes obligated to file a report or a proxy statement under or in response to Schedule 13D, Schedule TO or Schedule 14A (or any successor schedule, form or report or item therein) under the 

4

Exchange Act disclosing beneficial ownership by it of shares of voting stock of the Company, whether in excess of 50% or otherwise.
(i)    “Affiliate” means with respect to any Person (i) any other Person directly or indirectly controlling, controlled by or under common control with any such Person, (ii) any officer or general partner of such Person, and (iii) any legal entity for which such Person acts an executive officer or general partner.
4.    Procedure for Determination of Entitlement to Indemnification.

(a)    To obtain indemnification under this Agreement, Indemnitee shall submit to the Secretary of the Company a written request for payment of the appropriate Indemnified Amounts, including with such request such documentation and information as is reasonably available to Indemnitee and reasonably necessary to determine whether and to what extent Indemnitee is entitled to such Indemnified Amounts.  The Secretary of the Company shall, promptly upon receipt of such a request for indemnification, advise the Board in writing that Indemnitee has requested indemnification.

(b)    The Company shall pay Indemnitee the appropriate Indemnified Amounts unless it is established that Indemnitee has not met any applicable standard of conduct set forth in the Charter, the Bylaws or Maryland law or is not otherwise entitled to receive the Indemnified Amounts under this Agreement.  For purposes of determining whether Indemnitee is entitled to Indemnified Amounts, in order to deny indemnification to Indemnitee the Company has the burden of proof in establishing that Indemnitee did not meet the applicable standard of conduct.  In this regard, a termination of any Proceeding by judgment, order or settlement does not create a presumption that Indemnitee did not meet the requisite standard of conduct; provided, however, that the termination of any criminal proceeding by conviction, or a pleading of nolo contendere or its equivalent, or an entry of an order of probation prior to judgment, creates a rebuttable presumption that Indemnitee did not meet the applicable standard of conduct.
(c)    Any determination that Indemnitee has not met the applicable standard of conduct required to qualify for indemnification or is not otherwise entitled to receive the Indemnified Amounts under this Agreement shall be made either (i) by the Board by a majority vote of a quorum consisting of directors who were not parties of such Proceeding or (ii) by Independent Counsel (as defined below); provided that the manner in which (and, if applicable, the Independent Counsel by which) the right to indemnification is to be determined shall be approved in advance in writing by both the highest ranking executive officer of the Company who is not party to such action (sometimes hereinafter referred to as the “Senior Officer”) and by Indemnitee.  In the event that such parties are unable to agree on the manner in which any such determination is to be made, such determination shall be made by Independent Counsel retained by the Company for such purpose, provided that such counsel is approved in advance in writing by both the Senior Officer and Indemnitee.  The reasonable fees and expenses of such Independent Counsel in connection with making said determination contemplated hereunder shall be paid by the Company, and, if requested by such counsel, the Company shall give such 

5

counsel an appropriate written agreement with respect to the payment of their reasonable fees and expenses and such other matters as may be reasonably requested by such counsel.  Indemnitee may make a written objection to the identity of the Independent Counsel so selected by the Company.  Such objection may be asserted only on the ground that the Independent Counsel so selected may not serve as Independent Counsel unless and until a court has determined that such objection is without merit.  Either the Company or Indemnitee may petition a court in the State of Maryland for resolution of any such objection which shall have been made.  The party with respect to whom an objection is favorably resolved shall be paid all reasonable fees and expenses incident to the procedures of this Section 4(c).  Upon the due commencement of any judicial proceeding pursuant to Section 11 of this Agreement, the Independent Counsel shall be discharged and relieved of any further responsibility in such capacity (subject to the applicable standards of professional conduct then prevailing).
(d)    The Company will use its commercially reasonable efforts to conclude as soon as practicable any required determination pursuant to subsection (c) above and promptly will advise Indemnitee in writing with respect to any determination that Indemnitee is or is not entitled to indemnification, including a description of any reason or basis for which indemnification has been denied.  Indemnitee shall cooperate with the Person or Persons making such determination with respect to Indemnitee’s entitlement to indemnification, including providing to such Person or Persons upon reasonable advance request any documentation or information that is not privileged or otherwise protected from disclosure and that is reasonably available to Indemnitee and reasonably necessary to such determination.  Payment of any applicable Indemnified Amounts will be made to Indemnitee within ten (10) days after any determination of Indemnitee’s entitlement to such payment.
(e)    Notwithstanding the foregoing, Indemnitee may, at any time after sixty (60) days after a claim for Indemnified Amounts has been filed with the Company (or upon receipt of written notice that a claim for Indemnified Amounts has been rejected, if earlier) and before three (3) years after a claim for Indemnified Amounts has been filed, petition a court of competent jurisdiction within the State of Maryland to determine whether Indemnitee is entitled to indemnification under the provisions of this Agreement, and such court shall thereupon have the exclusive authority to make such determination unless and until such court dismisses or otherwise terminates such action without having made such determination.  The court shall, as petitioned, make an independent determination of whether Indemnitee is entitled to indemnification as provided under this Agreement, irrespective of any prior determination made by the Board or Independent Counsel.  If the court shall determine that Indemnitee is entitled to indemnification as to any claim, issue or matter involved in the Proceeding with respect to which there has been no prior determination pursuant to this Agreement or with respect to which there has been a prior determination that Indemnitee was not entitled to indemnification hereunder, the Company shall pay Expenses actually and reasonably incurred by Indemnitee in connection with such judicial determination.
(f)    “Independent Counsel” means a law firm or a member of a law firm that neither at the time in question, nor in the five (5) years immediately preceding such time, has 

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been retained to represent (i) the Company or Indemnitee in any matter material to either such party or (ii) any other party to the Proceeding giving rise to a claim for indemnification under this Agreement.  Notwithstanding the foregoing, the term “Independent Counsel” shall not include any Person who, under the applicable standards of professional conduct then prevailing under the laws of the State of Maryland, would be precluded from representing either the Company or Indemnitee in an action to determine Indemnitee’s rights under this Agreement.

5.    Presumptions and Effect of Certain Proceedings.
(a)    In making a determination, with respect to entitlement to indemnification hereunder, the Person or Persons making such determination shall presume that Indemnitee is entitled to indemnification under this Agreement if Indemnitee has submitted a request for indemnification in accordance with Section 4 of this Agreement, and the Company shall bear the burden of proof to rebut that presumption in connection with the making by any Person or Persons of any determination contrary to that presumption.
(b)    The termination of any Proceeding or of any claim, issue or matter therein by judgment, order, settlement or conviction, or upon a plea of nolo contendere or its equivalent, shall not (except as otherwise expressly provided in this Agreement) of itself adversely affect the right of Indemnitee to indemnification or create a presumption that Indemnitee did not act in good faith and in a manner which he or she reasonably believed to be in or not opposed to the best interests of the Company and its stockholders or, with respect to any criminal action or proceeding, that Indemnitee had reasonable cause to believe that his conduct was unlawful.
(c)    Indemnitee’s conduct with respect to an employee benefit plan for a purpose he or she reasonably believed to be in the interests of the participants in and beneficiaries of the plan shall be deemed to be conduct that Indemnitee reasonably believed to be in or not opposed to the best interests of the Company and its stockholders.
(d)    For purposes of any determination hereunder, Indemnitee shall be deemed to have acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the Company and its stockholders or, with respect to any criminal action or proceeding, to have had no reasonable cause to believe his or her conduct was unlawful, if his or her action was based on (i) the records or books of account of the Company or another Person, including financial statements, (ii) information supplied to him or her by the officers of the Company or another Person in the course of their duties, (iii) the advice of legal counsel for the Company or another Person, or (iv) information or records given or reports made to the Company or another Person by an independent certified public accountant or by an appraiser or other expert selected with reasonable care by the Company or another Person.  The term “Person” as used in this Agreement shall mean any other individual or corporation or any partnership, joint venture, trust, employee benefit plan or other entity or enterprise.

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6.    Success on Merits or Otherwise.  Notwithstanding any other provision of this Agreement, to the extent that Indemnitee has been successful on the merits or otherwise in defense of any Proceeding or in defense of any claim, issue or matter therein, he or she shall be indemnified against Expenses actually and reasonably incurred by him or her in connection with the investigation, defense, settlement or appeal thereof.  For purposes of this Section 6, the term “successful on the merits or otherwise” shall include, but not be limited to, (i) any termination, withdrawal or dismissal (with or without prejudice) of any Proceeding (or any claim, issue or matter therein) against Indemnitee without any express finding of liability or guilt against him or her, (ii) the expiration of 180 days after the making of any claim or threat of a Proceeding without the institution of the same and without any promise of payment or payment made to induce a settlement or (iii) the settlement of any Proceeding (or any claim, issue or matter therein) pursuant to which Indemnitee pays less than Ten Thousand Dollars ($10,000.00).
7.    Partial Indemnification.  If Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of Expenses of Indemnitee in connection with any Proceeding, but not, however, for the total amount thereof, the Company shall nevertheless indemnify Indemnitee for the portion thereof to which Indemnitee is entitled.
8.    Costs.  The Company shall also be solely responsible for paying (i) all reasonable expenses incurred by Indemnitee to enforce this Agreement, including, but not limited to, the costs incurred by Indemnitee to obtain court-ordered indemnification pursuant to Section 11, regardless of the outcome of any such application or proceeding, and (ii) all costs of defending any Proceedings challenging payments to Indemnitee under this Agreement.
9.    Advance of Expenses.
(a)    Indemnitee hereby is granted the right to receive in advance of a final, nonappealable judgment or other final adjudication of a Proceeding (a “Final Determination”) the amount of any Expenses incurred by Indemnitee in connection with any Proceeding (such amounts so expended or incurred being referred to as “Advanced Amounts”).
(b)    In making any written request for Advanced Amounts, Indemnitee shall submit to the Company a schedule setting forth in reasonable detail the dollar amount of Expenses expended or incurred and expected to be expended.  Each such listing shall be supported by the bill, agreement or other documentation relating thereto, each of which shall be appended to the schedule as an exhibit.  In addition, before Indemnitee may receive Advanced Amounts from the Company, Indemnitee shall provide to the Company (i) a written affirmation of Indemnitee’s good faith belief that the applicable standard of conduct set forth in the Maryland General Corporation Law (the “MGCL”), the Charter and the Bylaws required for indemnification by the Company has been satisfied by Indemnitee, and (ii) a written undertaking by or on behalf of Indemnitee to repay the Advanced Amounts if it shall ultimately be determined that Indemnitee has not satisfied any applicable standard of conduct or is not otherwise entitled to receive indemnification under this Agreement.  The written undertaking required from Indemnitee shall be an unlimited general obligation of Indemnitee but need not be secured.  The Company shall pay to Indemnitee all Advanced Amounts within twenty (20) days 

8

after receipt by the Company of all information and documentation required to be provided by Indemnitee pursuant to this subsection.
10.    Indemnification for Expenses of a Witness.  Notwithstanding any other provision of this Agreement, to the extent that Indemnitee is, by reason of any event or occurrence related to the fact that Indemnitee is or was an officer, director, employee or agent of the Company or any Subsidiary of the Company, or is or was serving at the request of the Company as an officer, director, employee or agent of another Person, a witness in any Proceeding, whether instituted by the Company or any other party, and to which Indemnitee is not a party, he or she shall be indemnified against all Expenses actually and reasonably incurred by him or her or on his or her behalf in connection therewith.
11.    Enforcement.
(a)    If a claim for indemnification or advancement of Expenses made to the Company pursuant to Section 4 or 9 is not timely paid in full to Indemnitee by the Company as required by Section 4 or 9, respectively, Indemnitee shall be entitled to seek judicial enforcement of the Company’s obligations to make such payment in an appropriate court of the State of Maryland.  In the event that a determination is made that Indemnitee is not entitled to indemnification or advancement of Expenses hereunder, (i) Indemnitee may seek a de novo adjudication of Indemnitee’s entitlement to such indemnification or advancement by an appropriate court of the State of Maryland; (ii) any such judicial proceeding shall not in any way be prejudiced by, and Indemnitee shall not be prejudiced in any way by, such adverse determination; and (iii) in any such judicial proceeding the Company shall have the burden of proving that Indemnitee is not entitled to indemnification or advancement of Expenses under this Agreement.  Indemnitee shall commence a proceeding seeking an adjudication of Indemnitee’s right to indemnification or advancement of Expenses pursuant to the preceding sentence within six (6) months following the date on which Indemnitee first has the right to commence such proceeding pursuant to this Section 11(a).
(b)    The Company shall be precluded from asserting in any judicial proceeding commenced pursuant to the provisions of Section 11(a) that the procedures and presumptions of this Agreement are not valid, binding and enforceable and shall stipulate in any such court that the Company is bound by all the provisions of this Agreement.
(c)    In any action brought under this Section 11, it shall be a defense to a claim for indemnification (other than an action brought to enforce a claim for advancement of Expenses) that Indemnitee has not met the standards of conduct which make it permissible under the MGCL, the Charter and the Bylaws for the Company to indemnify Indemnitee for the amount claimed.  The burden of proving such defense shall be on the Company.
12.    Liability Insurance and Funding.  To the extent the Company maintains an insurance policy or policies providing directors’ and officers’ liability insurance, Indemnitee shall be covered by such policy or policies, in accordance with its or their terms, to the maximum extent of the coverage available for any director or officer of the Company.  If, at the time of the 

9

receipt of a notice of a claim pursuant to Section 4 hereof, the Company has directors’ and officers’ liability insurance in effect, the Company shall give prompt notice of the commencement of any Proceeding to the insurers in accordance with the procedures set forth in the respective policies.  The Company shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of Indemnitee, all amounts payable as a result of such Proceeding in accordance with the terms of such policies.  The Company shall have no obligation to obtain or maintain such insurance.
13.    Merger or Consolidation.  In the event that the Company shall be a constituent corporation in a merger, consolidation or other reorganization, the Company shall require as a condition thereto, (a) if it shall not be the surviving, resulting or acquiring corporation therein, the surviving, resulting or acquiring corporation to agree to indemnify Indemnitee to the full extent provided herein, and (b) whether or not the Company is the surviving, resulting or acquiring corporation therein, Indemnitee shall also stand in the same position under this Agreement with respect to the surviving, resulting or acquiring corporation as Indemnitee would have with respect to the Company if the Company’s separate existence had continued; provided, however, that in the event the surviving entity in any such merger or consolidation shall be formed in a state other than the State of Maryland under the MGCL or in Maryland under another statute and the laws of such other state or such statute provide greater rights of indemnification and advancement of Expenses than are provided under the MGCL or the law of Maryland, the Indemnitee shall have such rights to the extent they are greater as provided pursuant to the laws of such other state or such other statute.
14.    Nondisclosure of Payments.  Except as expressly required by federal securities laws or other applicable laws or regulations or by judicial process, Indemnitee shall not disclose any payments made under this Agreement, whether indemnification or advancement of Expenses, unless prior written approval of the Company is obtained; provided that Indemnitee may, without such approval, disclose the payments to Indemnitee’s spouse and immediate family members, attorney(s), accountant(s) and tax advisor(s), as reasonably necessary.
15.    Nonexclusivity and Severability; Subrogation.
(a)    The right to indemnification and advancement of Expenses provided by this Agreement shall not be exclusive of any other rights to which Indemnitee may be entitled under the Charter, the Bylaws, the MGCL, Maryland law or any other statute, insurance policy, agreement, vote of stockholders of the Company or of the Board (or otherwise), both as to actions in his or her official capacity and as to actions in another capacity while holding such office, and shall continue after Indemnitee has ceased to be a director or officer of the Company and shall inure to the benefit of his or her heirs, executors and administrators; provided, however, that to the extent Indemnitee otherwise would have any greater right to indemnification and/or advancement of Expenses under any provision of the Charter, the Bylaws or any provision of the MGCL or Maryland law, Indemnitee shall be deemed to have such greater right pursuant to this Agreement; and, provided, further, that to the extent that any change is made to the MGCL or Maryland law (whether by legislative action or judicial decision), the Charter and/or the Bylaws that permits any greater right to indemnification and/or advancement of Expenses than that 

10

provided under this Agreement as of the date hereof, Indemnitee shall be deemed to have such greater right pursuant to this Agreement.  No amendment, alteration or repeal of this Agreement or of any provision hereof shall limit or restrict any right of Indemnitee under this Agreement in respect of any action taken or omitted by such Indemnitee prior to such amendment, alteration or repeal.
(b)    If any provision or provisions of this Agreement are held to be invalid, illegal or unenforceable for any reason whatsoever:  (i) the validity, legality and enforceability of the remaining provisions of this Agreement (including, without limitation, all portions of any provisions of this Agreement containing any such provision held to be invalid, illegal or unenforceable that are not themselves invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby and (ii) to the fullest extent possible, the provisions of this Agreement (including, without limitation, all portions of any provisions of this Agreement containing any such provision held to be invalid, illegal or unenforceable that are not themselves invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested by the provision held invalid, illegal or unenforceable.
(c)    In the event of any payment under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee, who shall execute all papers required and take all actions necessary to secure such rights, including execution of such documents as are necessary to enable the Company to bring suit to enforce such rights.
16.    Notices.  All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed duly given (i) if delivered by hand and receipted for by the party addressed, on the date of such receipt, of (ii) if mailed by domestic certified or registered mail with postage prepaid, on the third business day after the date postmarked.  Addresses for notice to either party are as shown on the signature page of this Agreement or as subsequently modified by written notice.
17.    Mutual Acknowledgement.  Both the Company and Indemnitee acknowledge that in certain instances federal law or public policy may override applicable state law and prohibit the Company from indemnifying Indemnitee under this Agreement or otherwise.  For example, the Company and Indemnitee acknowledge that the Securities and Exchange Commission has taken the position that indemnification is not permissible for liabilities arising under certain federal securities laws and federal legislation prohibits indemnification for certain ERISA violations.  Indemnitee understands and acknowledges that the Company shall not be required to provide indemnification or advance Expenses in violation of any law or public policy.
18.    Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of Maryland, without giving effect to principles of conflict of laws.

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19.    Consent to Jurisdiction.  The Company and Indemnitee each hereby irrevocably consent to the jurisdiction of the courts of the State of Maryland for all purposes in connection with any action, suit or proceeding which arises out of or relates to this Agreement.
20.    Identical Counterparts.  This Agreement may be executed in one or more counterparts, each of which shall for all purposes be deemed to be an original but all of which together shall constitute one and the same Agreement.  Only one such counterpart signed by the party against whom enforcement is sought needs to be produced to evidence the existence of this Agreement.
21.    Modification; Survival.  This Agreement may be modified only by an instrument in writing signed by both parties hereto.  The provisions of this Agreement shall survive the death, disability or incapacity of Indemnitee or the termination of Indemnitee’s service as a director or officer of the Company and shall inure to the benefit of Indemnitee’s heirs, executors and administrators.
22.    Waiver.  Failure to insist upon strict compliance with any of the terms or provisions hereof shall not be deemed a waiver of such term or provision, nor shall any waiver or relinquishment of any right or remedy hereunder at any one or more times be deemed a waiver of such right or remedy at any other time or times.  Such waiver of any term or condition of this Agreement shall not affect any other term or condition of this Agreement which shall remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have executed this Indemnification Agreement as of the date first above written.
INDEMNITEE:
________________________________
Name:

Address:
________________________
________________________
________________________
________________________

RESOURCE CAPITAL CORP.

By:                     
      Name:   
      Title: 

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Address:
One Crescent Drive, Suite 203
Philadelphia, PA 19112
Attn: Chief Legal Officer
 

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