Document:

EX-10.2

 Exhibit 10.2 
  

EXECUTION VERSION 

ASSET MANAGEMENT AGREEMENT 

This ASSET MANAGEMENT AGREEMENT (as amended or restated from time to time, including all appendixes and exhibits thereto, this
“Agreement”), dated as of July 6, 2018, by and between Creek Pine REIT, LLC, a Delaware limited liability company (the “Company”), Crown Pine Realty 1, Inc., a Delaware corporation (“CPR1”),
and CatchMark TRS Creek Management, LLC, a Delaware limited liability company (the “Asset Manager”). The Company, CPR1 and the Asset Manager are each referred to herein as a “Party” and collectively as the
“Parties.” 
 RECITALS 

WHEREAS, the Company intends to elect to be taxed as a REIT (as hereinafter defined) for federal income tax purposes; 

WHEREAS, the Company shall cause CPR1 to undertake certain activities the income from which would not (or the activities of which would
cause any rents not to) be treated with respect to the Company as “qualifying income” (within the meaning of Section 856(c) of the Code); and 

WHEREAS, CPR1 and the Company desire that the Asset Manager provide such services to the Company and its Subsidiaries (including CPR1)
as are set forth herein, and the Asset Manager desires to render such services in consideration of the compensation provided for herein. 

NOW, THEREFORE, in consideration of the mutual agreements set forth herein, the Parties agree as follows: 

1. DEFINED TERMS. used in this Agreement shall, unless the context otherwise requires, have the meanings specified in this
Section 1 or, if not so specified, shall have the meanings given to such defined terms in the Company LLC Agreement. 

(a) “Affiliate” means, in relation to a Person, any holding company, subsidiary or any other subsidiaries of any such
holding company, in each case of such Person and any Person that Controls, is Controlled by or is under common Control with such Person. 

(b) “Agreement” shall have the meaning set forth in the Preamble. 

(c) “Allowable Variance” shall have the meaning set forth in Section 3(b). 

(d) “Alternative Voting System” shall have the meaning ascribed to such term in the Company LLC Agreement. 

(e) “Annual Budget” shall have the meaning set forth in Section 3(a). 

(f) “Annual Harvest Schedule” shall have the meaning set forth on Schedule
B-2. 
 (g) “Applicable Rate” shall have the meaning set forth in
Section 9(a). 

 (h) “Asset Management Fee” shall have the meaning set forth in
Section 9(a). 
 (i) “Asset Manager” shall have the meaning set forth in the Preamble. 

(j) “Bad Act” means, with respect to a Person, (i) gross negligence, (ii) bad faith, (iii) fraud, or
(iv) willful misconduct; provided, that, other than with respect to fraud, if the applicable action or circumstance is curable, then the breaching party will not be deemed to have caused the occurrence of a Bad Act pursuant to this
definition if such party cures the applicable action or circumstance (including, for the avoidance of doubt, paying or otherwise remedying any adverse effects resulting from the Bad Act and otherwise offsetting any Losses suffered by other relevant
Persons) within the thirty (30) days following the receipt of written notice thereof. For the avoidance of doubt, for purposes of Section 11(c), any Loss in respect of or arising from an act by the Asset Manager as a
fiduciary under the Employee Retirement Income Security Act of 1974, as amended, and the regulations thereunder shall not constitute a “Bad Act.” 

(k) “Bankruptcy” shall have the meaning ascribed to such term in the Company LLC Agreement. 

(l) “Beginning Preferred Partner Ratio” shall mean the number equal to (x) the aggregate amount of all Capital
Contributions (as such term is defined in the Parent LP Agreement) made by the Preferred Partners in accordance with the Parent LP Agreement as of the date hereof, divided by (y) the aggregate amount of all Capital Contributions made by
all Partners in accordance with the Parent LP Agreement as of the date hereof. 
 (m) “Budget Development Protocols”
shall have the meaning set forth in Section 3(a). 
 (n) “Budget Impasse” shall have the
meaning set forth in Section 3(c). 
 (o) “Business Assets” shall have the meaning ascribed
to such term in the Company LLC Agreement. 
 (p) “Business Day” shall have the meaning ascribed to such term in the
Company LLC Agreement. 
 (q) “Capital Contribution” shall have the meaning ascribed to such term in the Parent LP
Agreement. 
 (r) “Cause” shall mean any of the following: 

(i) there has been a final determination by a court of competent jurisdiction, or an admission by the Asset Manager or any of
its Affiliates, that the Asset Manager or any of its Affiliates has committed, in connection with the performance of the Asset Manager’s duties under this Agreement, (1) fraud or intentional misappropriation of funds, (2) willful
misconduct, (3) gross negligence; or (4) a breach of this Agreement resulting in material Losses to the Parent, the Company or any of its Subsidiaries, taken as a whole; provided, that, such an occurrence shall not constitute
“Cause” to the extent (1) 

  
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the act or omission is the result of the conduct of an employee of the Asset Manager or its Affiliates who is not otherwise a Senior Officer, (2) such conduct occurs without the prior
knowledge of a Senior Officer or (3) such “Cause” event is cured within thirty (30) days, which cure may include: (x) the removal of the subject employee from the Asset Manager or the applicable Affiliate, as
applicable; (y) a comprehensive review by the Asset Manager or the applicable Affiliate of its internal policies and procedures to determine whether additional procedures should be implemented in order to prevent such act or event by the Asset
Manager (or such Affiliate thereof); and (z) full restitution and reimbursement is made to the Parent, the Company or the applicable Subsidiary, or to the Preferred Partners, as applicable, by the Asset Manager, for any Losses caused by such
Cause event; 
 (ii) a Transfer by the General Partner or any of its Affiliates in contravention of the Parent LP Agreement
that is not cured within thirty (30) days after the earlier of (x) the General Partner (or CTT Partner (as such term is defined in the Parent LP Agreement)) becoming aware of such Transfer or (y) written notice from a Partner
specifying the breach; 
 (iii) the Asset Manager has failed to retain certification by or to obtain recertification from
Sustainable Forestry Initiative Inc. with respect to all of the Property; or; 
 (iv) the Bankruptcy of (i) the Asset
Manager or (ii) CTT, CatchMark Timber Operating Partnership, L.P., or any Affiliate thereof that directly holds equity interests in Parent. 

(s) “Change of Control” shall mean any transaction or series of related transactions which directly or indirectly
results in: 
 (i) the acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) of the
Securities Exchange Act of 1934, as amended (“Exchange Act”)) of direct or indirect beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 50% or more of
either the then-outstanding shares of common stock of CTT or the Asset Manager or the combined voting power of any other then-outstanding securities of CTT or the Asset Manager entitled to vote generally in the election of directors (as applicable
with respect to CTT or the Asset Manager the “Outstanding Voting Securities”); or 
 (ii) any merger,
consolidation, reorganization or other similar transaction pursuant to which CTT or the Asset Manager is merged with and into or otherwise acquired by another entity; excluding, however, any such transaction pursuant to which the individuals
and entities who are beneficial owners of the applicable entity’s Outstanding Voting Securities immediately prior to such transaction will in the aggregate beneficially own, directly or indirectly, 50% or more of the outstanding shares of
common stock, and the combined voting power of the then-outstanding securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such transaction (including a corporation that as a result
of such transaction owns CTT or the Asset Manager, as applicable, or all or substantially all of the assets of CTT or the Asset Manager, as applicable, either directly or through one or more subsidiaries). 

  
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 (t) “Closing” shall have the meaning ascribed to such term in the Parent
LP Agreement. 
 (u) “Code” shall mean the Internal Revenue Code of 1986, as amended. 

(v) “Company” shall have the meaning set forth in the Preamble. 

(w) “Company Account” shall have the meaning set forth in Section 7. 

(x) “Company Board” shall mean the board of managers of the Company, as established and maintained pursuant to the
Company LLC Agreement. 
 (y) “Company LLC Agreement” means the Amended and Restated Limited Liability Company
Agreement of the Company (as amended or restated from time to time, including all appendixes and exhibits thereto). 
 (z)
“Confidential Information” shall have the meaning set forth in Section 8(b). 
 (aa)
“Constituent Members” means any Person that is an officer, director, member, partner or shareholder in a Person, or any Person that, indirectly through one or more limited liability companies, partnerships or other entities, is
an officer, director, member, partner or shareholder in a Person. 
 (bb) “Control” means, in relation to a
Person, where a person (or persons acting in concert) holds or has direct or indirect control of (i) the affairs of that Person, or (ii) more than fifty percent (50%) of the total voting rights conferred by all the issued shares in the
capital of that Person which are ordinarily exercisable in a general meeting (or the equivalent) or (iii) a majority of the board of directors/managers of that Person, and “Controlled by” and “Controlling”
shall be construed accordingly. For these purposes, “persons acting in concert,” in relation to a Person, are persons which actively cooperate pursuant to an agreement or understanding (whether formal or informal), with a view to
exercising, obtaining or consolidating Control of that Person. 
 (cc) “CTT” shall mean CatchMark Timber Trust, Inc.

 (dd) “Deferred Asset Management Fees” shall have the meaning ascribed to such term in the Company LLC Agreement.

 (ee) “Excluded Loss” means (a) any Losses to the extent the same are reimbursed by insurance proceeds or
indemnities from third parties and (b) any consequential, special, punitive or exemplary damages to the extent such damages are not owed to a third party in connection with any third party claim. 

(ff) “Expenses” shall have the meaning set forth in Section 10(a) 

  
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 (gg) “Fiscal Quarter” shall have the meaning ascribed to such term in the
Company LLC Agreement. 
 (hh) “Fiscal Year” shall have the meaning ascribed to such term in the Company LLC
Agreement. 
 (ii) “General Partner” shall have the meaning ascribed to such term in the Parent LP Agreement. 

(jj) “Government Authority” means (i) a federal or national government, any state government, any political
subdivision thereof, or any local jurisdiction therein; (ii) an instrumentality, board, commission, court or agency, whether civilian or military, of any of the above, however constituted; (iii) a public organization, being an organization
whose members are (A) countries or territories; (B) governments of countries or territories; and/or (C) other public international organizations and includes the World Bank, the United Nations, the International Monetary Fund and the
OECD; or (iv) any company, association, organization, business, enterprise or other entity which is owned, whether in whole or in part, or controlled by any person listed in (i) to (iii) above. 

(kk) “Indemnified Party” shall have the meaning set forth in Section 11(c). 

(ll) “Indemnitor” shall have the meaning set forth in Section 11(d). 

(mm) “Initial Annual Budget” shall have the meaning set forth in Section 3(a). 

(nn) “Key Man” shall mean any person set forth on Schedule A attached hereto. 

(oo) “Key Man Employment Agreement” shall mean the Employment Agreements listed on Schedule A attached hereto,
as such may be amended, restated, supplemented, modified or otherwise renegotiated. 
 (pp) “Key Man Event” shall
have the meaning set forth in Section 12. 
 (qq) “Law” means any law, statute, act,
legislation, bill, enactment, policy, treaty, international agreement, ordinance, judgment, injunction, award, decree, rule, regulation, interpretation, determination, requirement, writ or order of any Government Authority. 

(rr) “Loss” or “Losses” means the dollar amounts of all actual costs, claims, suits, actions, damages,
losses, liabilities, obligations, reasonable fees and expenses of any kind or nature, including costs and expenses of accountants, attorneys and other professionals, judgments, fines, penalties, settlements and all other costs and expenses and
disbursements of any nature or type actually paid or incurred or imposed on or asserted against a specified Person, and all costs and expenses paid or incurred by the prevailing party or any of its Affiliates in litigating against any other party or
any of its Affiliates, but specifically excluding in all such cases any Excluded Loss. 

  
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 (ss) “Major Decision” shall have the meaning ascribed to such term in the
Company LLC Agreement. 
 (tt) “Manager Indemnified Parties” shall have the meaning set forth in
Section 11(a). 
 (uu) “Non-Controllable Expenses”
shall have the meaning set forth in Section 3(c). 
 (vv) “Parent” shall mean TexMark
Timber Treasury, LP, a Delaware limited partnership. 
 (ww) “Parent Board” shall mean the partnership board of the
Parent, as established and maintained pursuant to the Parent LP Agreement. 
 (xx) “Parent Indemnified Parties” shall
have the meaning set forth in Section 11(c). 
 (yy) “Parent Partners” shall mean the
Partners of the Parent, as defined in the Parent LP Agreement. 
 (zz) “Parent LP Agreement” means the Amended and
Restated Limited Partnership Agreement of TexMark Timber Treasury, L.P., a Delaware limited partnership (as amended or restated from time to time, including all appendixes and exhibits thereto). 

(aaa) “Partner” shall have the meaning set forth in the Parent LP Agreement. 

(bbb) “Party” shall have the meaning set forth in the Preamble. 

(ccc) “Person” means an individual or a general partnership, limited partnership, corporation, professional
corporation, limited liability company, limited liability partnership, joint venture, trust, business trust, unincorporated organization, cooperative or association or a governmental, administrative or regulatory agency or any other entity. 

(ddd) “Preferred Board Members” shall have the meaning set forth in Section 3(a). 

(eee) “Preferred Partners” shall have the meaning ascribed to such term in the Parent LP Agreement. 

(fff) “Preliminary Budget” shall have the meaning set forth on Schedule
B-2. 
 (ggg) “Property” shall have the meaning ascribed to such term in
the Company LLC Agreement. 
 (hhh) “Purchase Price” shall mean $1,379,000,000. 

  
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 (iii) “Qualified REIT Consultant” means a nationally recognized
accounting firm, which may be the Company’s audit or tax firm, or a nationally recognized law firm selected by the Asset Manager. 

(jjj) “REIT” means a “real estate investment trust” under Section 856 of the Code 

(kkk) “Senior Credit Documents” shall have the meaning ascribed to such term in the Parent LP Agreement. 

(lll) “Senior Lender” shall have the meaning ascribed to such term in the Parent LP Agreement. 

(mmm) “Senior Officer” means a senior officer or director of the Asset Manager or its Affiliates. 

(nnn) “Services” shall have the meaning set forth in the Section 2(b). 

(ooo) “Subsidiaries” means, with respect to any Person, any corporation, partnership, limited liability company, trust
or other entity of which all or any part of the outstanding equity interests are owned, directly or indirectly, by such Person. For the avoidance of doubt, the Company and its Subsidiaries and CPR1 shall each be considered a Subsidiary of Parent,
and CPR1 shall be considered a Subsidiary of the Company, for purposes of this Agreement. 
 (ppp) “Termination Date”
shall mean the effective date of any termination of this Agreement in accordance with the terms hereof. 
 (qqq) “Thirty-Year
Harvest Schedule” shall have the meaning set forth on Schedule B-2. 
 (rrr)
“Three-Year Harvest Plan” shall have the meaning set forth on Schedule B-2. 

(sss) “Timber Manager” shall mean any entity that has been retained by the Company or a Subsidiary thereof to perform
and carry out property management services at the Property or any other Real Estate Assets. 
 (ttt) “Transfer” shall
have the meaning ascribed to such term in the Company LLC Agreement. 
 (uuu) “Wood Supply Agreements” shall have the
meaning ascribed to such term in the Company LLC Agreement. 

  
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 2. APPOINTMENT AND DUTIES OF THE ASSET MANAGER. 

(a) On the terms and subject to the conditions set forth in this Agreement, the Company, on its own behalf and on behalf of each of its
Subsidiaries, hereby appoints the Asset Manager to serve as asset manager and to provide the Services, and the Asset Manager hereby accepts such appointment. Except as otherwise provided herein or in connection with the termination of this
Agreement, neither the Company nor any of its Subsidiaries shall appoint any other Person to serve as Asset Manager or to provide the services of the Asset Manager as set forth in this Agreement, except to the extent that the Asset Manager otherwise
agrees, in its sole and absolute discretion. Whenever in this Agreement the approval or consent of the Company is required, such approval shall be obtained through the affirmative action of the Company Board, in accordance with the terms of the
Company LLC Agreement. 
 (b) The Asset Manager undertakes and agrees to use all commercially reasonable efforts to provide the
Services and to otherwise fulfill its obligations hereunder. In rendering the Services and otherwise fulfilling its obligations hereunder, the Asset Manager will at all times (i) be subject to the supervision, management and direction of the
Company Board and any applicable approvals required by or restrictions imposed by this Agreement, the Company LLC Agreement or the Parent LP Agreement and, (ii) have only such functions and authority as the Company Board may delegate to it,
including the functions and authority identified herein and delegated to the Asset Manager hereby, (iii) not take, or cause to be taken, any action that constitutes a Major Decision without such action having received the required prior
approval of the Parent Board or the Company Board, as applicable, in accordance with the Parent LP Agreement or the Company LLC Agreement, as applicable, (iv) act in a manner consistent with, and subject to, the applicable Annual Budget
(subject to Section 3 hereof) and applicable Law and (v) act in good faith as a reasonable expert in managing forestry investments. Subject to the foregoing, during the term of this Agreement, the Asset Manager will be
responsible for the following (collectively, the “Services”): 
 (i) preparing the Annual Budget and
presenting the Annual Budget for approval in accordance with Section 3 hereof and the Company LLC Agreement; 

(ii) implementing each Annual Budget following the approval thereof in accordance with the terms of such approved Annual Budget
and Section 3 hereof; 
 (iii) administering the day-to-day business and operations of the Company and its Subsidiaries and performing and supervising the performance of such administrative functions necessary to the management of the Company and its
Subsidiaries as may be agreed upon by the Asset Manager and the Company Board; 
 (iv) assisting the Company in retaining at
all times a Qualified REIT Consultant and other advisors to advise the Company regarding the maintenance of the Company’s qualification as a REIT and monitoring compliance with the various REIT qualification tests and other rules set out in the
Code and Treasury Regulations thereunder; 
 (v) investigating, selecting, engaging and supervising, on behalf of the Company
and its Subsidiaries, third party service providers as contemplated by Section 2(c) hereof; 

  
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 (vi) overseeing the performance by each Timber Manager of its duties and making
periodic recommendations to the Company Board regarding the engagement, or termination of, such Timber Managers; 
 (vii)
identifying, investigating, analyzing and originating potential investment opportunities for the Company and its Subsidiaries, to the extent directed to do so by the Company Board; 

(viii) consulting with the Company Board regarding acquiring, financing, retaining, selling, restructuring or disposing of
Business Assets and recommending strategies for the same; 
 (ix) supervising and structuring prospective sales or exchanges
of Business Assets, and conducting negotiations with purchasers, brokers, lenders and, if applicable, their respective agents and representatives, in each case, as requested by the Company Board; 

(x) identifying, evaluating and recommending sources of financing for the Company and its Subsidiaries, as requested by the
Company Board; 
 (xi) providing the Company Board with periodic review and evaluation of the performance of the Business
Assets and other customary functions related to asset management; 
 (xii) taking required actions on behalf of the Company
and its Subsidiaries to qualify to do business in all applicable jurisdictions and to obtain and maintain all appropriate licenses; 

(xiii) taking required actions on behalf of the Company and its Subsidiaries in complying with all applicable regulatory
requirements with respect to their business activities; 
 (xiv) preparing and filing all tax returns and tax elections which
are required by applicable law to be filed or are otherwise advisable and taking all other action reasonably necessary in connection with such required tax filings and reports with respect to the Company and its Subsidiaries (subject to the written
approval of the Company and/or its Subsidiaries, as applicable); 
 (xv) preparing, or causing to be prepared, and delivering
(i) the financial reports and other information set forth in Section 4 hereof (pursuant to the terms thereof), and, (ii) the information related to tax matters set forth in Section 5
hereof (pursuant to the terms thereof); 
 (xvi) preparing and providing for submission to and approval by the Company Board,
prior to approval of the first Annual Budget, health and safety policies and procedures for employees and contractors (including all reasonably requested amendments thereto from the Company Board), as well as for tracking, reporting and managing
workplace health and safety; 

  
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 (xvii) ensuring that the Business Assets are managed in accordance with
Sustainable Forestry Initiative requirements, including all required reporting and auditing obligations, and forecasting a timeline for audits and recertification, as applicable, and reporting to the Company Board on the same; 

(xviii) complying with the requirements of the Wood Supply Agreements, including preparing, delivering and obtaining approval
of the Annual Plan, Forecast Plan and Delivery Plan (as each such term is defined in the Wood Supply Agreements) each year when and as required in the Wood Supply Agreements; 

(xix) reporting quarterly to the Company Board any variances in harvest from the harvest plans for the previous calendar
quarter exceeding Allowable Variance as identified on Exhibit A appended hereto, and shall not exceed any such Allowable Variance without having first obtained the approval of the Company Board; 

(xx) submitting to the Company Board monthly reports detailing any recordable incidents for employees and contractors that
occurred in the previous month and any material environmental compliance matters, including violations or potential violations of Laws and best management practices applicable to the Business Assets, the Company and its Subsidiaries, and the
operation of the same; 
 (xxi) preparing, or causing to be prepared, and delivering, or causing to be delivered, to the
lenders or other creditors of the Company or any of its Subsidiaries, such financial information, reports and other information as is required pursuant to the terms of any loan or credit agreement between the Company or any of its Subsidiaries and
such lenders or creditors; 
 (xxii) providing such other services (i) related to the foregoing as the Asset Manager and
the Company Board may reasonably agree upon or (ii) set forth elsewhere herein; and 
 (xxiii) doing all things
reasonably necessary to assure its ability to render the Services as described in this Agreement. 
 Notwithstanding anything else to the
contrary in this Agreement, the Asset Manager shall, at all times in its provision of the above Services, (A) hold itself out to the public as a legal entity separate and distinct from the Parent, the Company and its Subsidiaries,
(B) correct any known misunderstanding regarding its status as a separate entity from the Parent, the Company and its Subsidiaries, (C) conduct and operate its business in its own name and (D) not identify itself or any of its
Affiliates as a division or part of the Parent, the Company or its Subsidiaries. Further, the Asset Manager shall not assume any liability for any obligations of the Parent, the Company and their Subsidiaries (and shall clearly identify in any
action taken on behalf of the Company or their Subsidiaries that the Asset Manager is acting in the capacity as agent and not in its individual capacity), and neither the Asset Manager nor the Company or the any of their Subsidiaries shall hold the
Asset Manager out to any third parties as liable for any of the obligations of the Parent, the Company or any of their Subsidiaries. For the avoidance of doubt, the immediately preceding sentence is not intended to modify the liability of any
Affiliate of the Asset Manager that owns equity interests of the Parent, subject to the applicable provisions of the Parent LP Agreement. 

  
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 (c) The Asset Manager may investigate, select, recommend, engage and supervise, for and on
behalf of, and at the sole cost and expense of, the Company or its Subsidiaries, accountants, legal counsel, appraisers, insurers, brokers, transfer agents, registrars, developers, investment banks, valuation firms, financial advisors, due diligence
firms and such other third party professionals as the Asset Manager reasonably deems necessary or advisable in connection with the performance of the Services and its other obligations hereunder, and the Company or its Subsidiaries shall pay for the
reasonable cost and expenses thereof, including pursuant to Section 7 of this Agreement. Any such engagement of third party professionals shall not relieve the Asset Manager from its obligations hereunder. 

(d) Anything in this Agreement to the contrary notwithstanding, but subject to Section 2(g), the Asset Manager
shall refrain from taking any action which, in its sole judgment made in good faith, would (i) reasonably be expected to adversely affect the status of the Company as a REIT, (ii) subject Parent, the Company or any of its Subsidiaries to
regulation under the Investment Company Act of 1940, as amended, or (iii) violate any applicable Law or otherwise not be permitted by the Company LLC Agreement or the Parent LP Agreement. If such action shall be ordered by the General Partner,
the Parent Board or Company Board, the Asset Manager shall notify promptly the General Partner, the Parent Board or Company Board, as applicable, of the Asset Manager’s judgment of the potential impact of such action and shall refrain from
taking such action. In such event, the Asset Manager shall have no liability for acting in accordance with the specific instructions of the General Partner, the Parent Board or Company Board so given. Notwithstanding the foregoing, the Manager
Indemnified Parties shall not be liable to Parent, the Company or any of their respective Subsidiaries, the General Partner, the Parent Board or the Company Board, or the members, managers or partners of the General Partner, Parent, the Company or
any of their respective Subsidiaries, for any act or omission by any Manager Indemnified Parties except as provided in Section 11 of this Agreement. 

(e) In the performance of its obligations and responsibilities hereunder, the Asset Manager shall not (i) use any corporate funds
for any illegal contributions, gifts, entertainment or other unlawful expenses relating to political activity, (ii) use any corporate funds for any direct or indirect unlawful payments to any foreign or domestic governmental officials or
employees or any employees of a foreign or domestic government-owned entity, (iii) violate any provision of the Foreign Corrupt Practices Act of 1977 or any other anticorruption Law applicable to the Company or any of its Subsidiaries,
(iv) make, offer, authorize or promise any payment, rebate, payoff, influence payment, contribution, gift, bribe, rebate, kickback, or any other thing of value to any government official or employee, political party or official, or candidate,
regardless of form, to obtain favorable treatment in obtaining or retaining business or to pay for favorable treatment already secured, (v) establish or maintain any fund of corporate monies or other properties for the purpose of supplying
funds for any of the purposes described in the foregoing clause (iv) or (vi) make any bribe, unlawful rebate, payoff, influence payment, facilitation payment, kickback or other similar payment of any nature. The Asset Manager shall develop and
implement an anti-corruption compliance program that includes internal controls, policies and procedures designed to ensure compliance with any applicable national, regional or local anti-corruption Law. The Asset Manager shall report violations or
suspected violations of applicable anti-corruption Law or this Section 2(e) to the Company Board as soon as practicable after the Asset Manager becomes aware of or suspects a violation. 

  
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 (f) Without limiting any provision herein, all actions of the Parent and the Company under
this Agreement requiring the consent or approval of the Company Board shall be subject to the direction of the members of the Company Board. Asset Manager expressly acknowledges Section 4.12(b) of the Parent LP Agreement and the Company LLC
Agreement. 
 (g) Asset Manager shall, and shall use reasonable best efforts to take all actions required to cause the Company to,
comply with Sections 4.11 and 5.2 of the Company LLC Agreement. 
 (h) Asset Manager expressly acknowledges the restrictions on
Parent’s activities pursuant to Sections 4.17 and 4.19 of the Parent LP Agreement, and understands that the restrictions in Section 4.17 include the actions of an agent acting on its behalf. Asset Manager acknowledges and agrees that for
U.S. federal income tax purposes it is providing Services to and on behalf of distinct principals pursuant to this Agreement and agrees that it shall use reasonable best efforts to take all actions (including avoiding taking actions) required to
cause Parent to comply with such provisions of the Parent LP Agreement, without prejudice to actions required to be undertaken on behalf of the Company or its Subsidiaries. 

3. ANNUAL BUDGET. 
 (a)
The Company and its Subsidiaries shall be operated in accordance with an annual budget, as it may be annually updated from time to time pursuant to this Section 3 (the “Annual Budget”). The initial
Annual Budget for the period beginning on the Effective Date and ending on December 31, 2018, including the related variances, is attached hereto as Schedule B-1 (the “Initial Annual
Budget”). For each Fiscal Year thereafter, the Asset Manager shall be responsible for preparing and submitting to the Company Board for approval as a Major Decision in accordance with the terms of the Company LLC Agreement a proposed
updated Annual Budget, including the related variances. The Annual Budget shall be prepared by the Asset Manager in accordance with the protocols (including the preparation of the back-up materials on the
timetable set forth therein) set forth on Schedule B-2 hereto (the “Budget Development Protocols”). The Annual Budget for each Fiscal Year shall be prepared with the same detail and
line items as set forth in the Initial Annual Budget and such other detail as the members of the Company Board appointed by the Preferred Partners in accordance with Section 4.3(c) of the Parent LP Agreement (the “Preferred Board
Members”) may reasonably request. In connection with the review of a proposed Annual Budget, the Preferred Board Members may reasonably request additional information regarding the materials supporting the proposed Annual Budget or such
other information as is necessary or desirable to enable review of such proposed Annual Budget, and the Asset Manager shall provide such requested information. The Preferred Board Members shall consent to or reject the proposed Annual Budget, or
request additional information (as provided for above), within ten (10) Business Days following (i) receipt of such proposed Annual Budget or (ii) receipt of all additional information that is, in the determination of the Preferred
Board Members, necessary or desirable to enable review of such proposed Annual Budget. The Asset Manager shall comply with the Budget Development Protocols regarding the Preliminary Budget for each Fiscal Year. The Annual Budget shall be prepared
and submitted annually by the Asset 

  
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Manager no later than December 10, 2018 for the next Fiscal Year and thereafter by December 10 of each year with respect to the following Fiscal Year. The Annual Budget for each Fiscal
Year shall include use of the pre-funded reserve amounts as shown on Schedule B-3 hereto for the four Fiscal Quarters comprising such Fiscal Year. In connection
with the submission of the Annual Budget, the Asset Manager shall also prepare and submit to the Company Board an annual business plan for Parent and its Subsidiaries, including a responsible five-year operations forecast, including the operating
metrics set forth on Schedule B-4 hereto (the “Annual Plan”). The Preferred Board Members, or their designated representatives, shall be provided reasonable access to all information,
data, reports, models and analyses relied on in developing the Annual Plan (including, for the avoidance of doubt, all financial and silvicultural assumptions, constraints, supporting stand level data, merchantable timber volumes, pre-merchantable acres by species and age class, and acres by land classification). 
 (b) Pursuant
to this Agreement, the Asset Manager is charged with implementing each Annual Budget following the approval thereof, in accordance with the terms of such approved Annual Budget and the terms of this Agreement. In doing so, the Asset Manager shall at
all times act in a manner consistent with the Annual Budget; provided, however, that the Asset Manager may in its discretion expend funds for Non-Controllable Expenses (as defined below) not otherwise
reflected in the Annual Budget. In implementing the Annual Budget, the Asset Manager may in its discretion vary material line items in the applicable Annual Budget within the variances set forth in set forth in Exhibit A appended hereto (such
variances being referred to herein as “Allowable Variances”). Asset Manager shall not exceed any Allowable Variance without having first obtained the approval of the Company Board. 

(c) In the event the Asset Manager is unable to obtain the approval of the Company Board of any Annual Budget prior to the intended
period for such Annual Budget, then a “Budget Impasse” shall be deemed to exist, until such time as such Annual Budget is approved in accordance with this Agreement, the Parent LP Agreement and Company LLC Agreement. During any
Budget Impasse, the Asset Manager shall perform the Services and otherwise fulfill its obligations under this Agreement in accordance with the most recently approved Annual Budget, except that (i) the Asset Manager may make or cause to be made
any expenditure not contemplated by such Annual Budget which is (1) an emergency expenditure to protect the health, safety and welfare of people or property (in which event the Asset Manager shall notify the Company Board immediately) or
(2) an expenditure to satisfy (A) any outstanding taxes and related fees, costs and expenses, (B) any obligations for interest, principal (except at maturity), escrows, fees and expenses due under the Senior Credit Documents and any
other indebtedness approved as a Major Decision or (C) premiums for insurance required under this Agreement, the Parent LP Agreement or the Company LLC Agreement, and Senior Credit Documents, any loan document relating to indebtedness approved
as a Major Decision or any other contract to which the Parent or any of its Subsidiaries is a party that are entered into in accordance with the Parent LP Agreement (such expenses, “Non-Controllable
Expenses”) and (ii) the Asset Manager acting alone shall otherwise have no authority to make any other expenditure without the approval of the Company Board as a Major Decision. 

  
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 4. REPORTING. 

(a) The Asset Manager shall prepare, or cause to be prepared, at the expense of the Company and its Subsidiaries, all reports, financial
or otherwise, with respect to the Company and its Subsidiaries reasonably requested in order to comply with their respective organizational documents or any other materials required to be filed with any governmental body or agency, and shall
prepare, or cause to be prepared, all materials and data necessary to complete such reports and other materials. 
 (b) Without
limiting the generality of Section 4(a), the Asset Manager shall prepare, or cause to be prepared, and shall deliver to the Company and the Company Board, at the expense of Company, the following: 

(i) within forty-five (45) days after the end of each Fiscal Year, a report as of the end of such Fiscal Year prepared in
conformity with accounting principles generally accepted in the United States and consistently applied, setting forth (A) a balance sheet of Company (that will include appropriate footnote disclosure) as of the end of such Fiscal Year, and
(B) an income statement of Company for such Fiscal Year; provided, that the annual financial statements referred to in this Section 4(b)(i) shall be audited by a nationally recognized accounting firm in
accordance with generally accepted auditing standards in the United States and consistently applied, and such accounting firm’s report thereon shall accompany the annual financial statements ; provided, further, that while the
Asset Manager shall endeavor to provide such audited financial statements within the forty-five (45) day period stated above, it will not be considered to have breached this Section 4(b)(i) if it fails to do so if the
Asset Manager (x) is using commercially reasonable efforts to produce audited financial statements within such timeframe, (y) provides unaudited financial statements within such forty-five (45) day period and (z) provides such
audited financial statements as soon as practicable following such date but in any event no later than ninety (90) days after the end of such Fiscal Year; 

(ii) not later than forty-five (45) days after the end of each of the first three Fiscal Quarters of each Fiscal Year,
final versions of each of the following: 
 (A) An unaudited report setting forth as of the end of such fiscal quarter
(x) a balance sheet of Company as of the end of such Fiscal Quarter and (y) an income statement of Company for such Fiscal Quarter 

(B) A calculation of the reserves of the Company and the amount of “Base Available Cash,” “Net
Available Cash,” “Distributable Cash Flow” and “Remaining Distributable Cash Flow” as of the end of the relevant Fiscal Quarter, in each case, as defined in the Company LLC Agreement; 

(C) A narrative describing the condition of the Property and other Business Assets and operations of Company and its
Subsidiaries during such Fiscal Quarter; 
 (D) A report of any changes in the status of any major service contracts, any
material line item variances of more than ten percent (10%) from the Annual Budget and any litigation or other legal issues involving the Parent, the Company or its Subsidiaries during such Fiscal Quarter; and 

  
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 (E) A report providing a detailed description of each Permitted HBU Sale (as
defined in the Company LLC Agreement) consummated during such Fiscal Quarter. 
 (c) In addition to the reporting requirements set
forth above, the Asset Manager shall give notice to the Company Board of: 
 (i) Any items that will otherwise be reportable
under Section 4(b)(ii)(D) above promptly after the Asset Manager becomes aware of such item; 

(ii) Any known or reported non-conformance with applicable state and local regulations
and Sustainable Forestry Initiative standards or principles as in effect on the date hereof and as modified from time to time by Sustainable Forestry Initiative Inc.; and 

(iii) Any proposed transaction between the Company or any of its Subsidiaries, on one hand, and any other Person, on the other
hand, if such transaction would create a potential conflict of interest on the part of the Asset Manager in causing the Company or its Subsidiaries to enter into such transaction, or any other occurrence of a potential conflict of interest on the
part of the Asset Manager or its Affiliates in connection with causing Company (or its Subsidiaries) to enter into such transaction. 
 (d)
The Asset Manager shall meet with the Partners on a quarterly basis to discuss the quarterly reporting and such other topics relating to the business of the Company and its Subsidiaries as the other Partners may reasonably request. 

5. CERTAIN TAX MATTERS. The Asset Manager shall, at Company’s expense, use reasonable best efforts to (i) not later than
twenty-five (25) days from the end of each Fiscal Quarter (including the end of each Fiscal Year), provide to the Company a report regarding the Company’s compliance with the REIT asset tests in Section 856(c)(4) of the Code for such
Fiscal Quarter reviewed by the Qualified REIT Consultant, (ii) not later than forty-five (45) days from the end of each Fiscal Quarter, provide to the Company the quarterly REIT testing reports regarding the Company reviewed by the
Qualified REIT Consultant, and (iii) not later than forty-five (45) days after the end of each Fiscal Year, provide to the Company the final REIT testing report regarding the Company reviewed by the Qualified REIT Consultant. The Asset
Manager shall provide to the Company Board and Partners, as soon as is reasonably practicable following request thereof, any other information reasonably required to determine compliance by the Company with the requirements under Section 856
et seq. of the Code and the related Treasury Regulations for the Company to (x) qualify for, and maintain, status as a REIT and (y) avoid the imposition of any U.S. federal income tax or penalty on the Company. 

  
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 6. ADDITIONAL ACTIVITIES. Nothing in this Agreement is intended to prevent the Asset
Manager or any of its Affiliates, officers, directors, employees or personnel from engaging in other activities, investments or businesses, including from rendering advice or services of any kind to any other Person so long as Asset Manager complies
at all times with Section 8 and promptly notifies the Company Board of any such activities that conflict with its obligations hereunder. 

7. BANK ACCOUNTS. At the direction of the Company Board, the Asset Manager may establish and maintain one or more bank accounts
in the name of the Company or any of its Subsidiaries (any such account, a “Company Account”), and may collect and deposit funds into any such Company Account or Company Accounts, and disburse funds from any such Company Account or
Company Accounts for the payment of Expenses, under such terms and conditions as the Company Board may approve. The Asset Manager shall from time to time render appropriate accountings of such collections and disbursements to the Company and, upon
the request of the Company Board, to the Company’s auditors. The Asset Manager shall disburse funds to pay Expenses from the Company Account in the name of the entity with respect to which such Expenses relate. For the avoidance of doubt, the
Asset Manager’s disbursement of funds from the Company Accounts for the payment of Expenses or any other amounts shall be subject to the terms of the applicable Annual Budget and any limitations on specific Expenses set forth in
Section 10(a). 
 8. RECORDS; CONFIDENTIALITY. 

(a) The Asset Manager shall maintain and preserve the books and records of the Company and its Subsidiaries (including accounting and
reporting systems), and such records shall be accessible for inspection by the General Partner or representatives of Parent, the Company or any of its Subsidiaries at any time during normal business hours upon reasonable advance written notice. 

(b) The Asset Manager shall keep confidential any and all information regarding Parent, the Company or its Subsidiaries obtained in
connection with the Services rendered under this Agreement (“Confidential Information”) and shall not disclose any such Confidential Information (or use the same except in furtherance of its duties under this Agreement) to
unaffiliated third parties except (i) with the prior written consent of Company Board; (ii) to legal counsel, accountants and other professional advisors; (iii) to appraisers, financing sources and others in the ordinary course of
business of Parent, the Company and its Subsidiaries; (iv) to governmental officials having jurisdiction over Parent, the Company or any of its Subsidiaries; (v) in connection with any governmental or regulatory filings of Parent, the
Company or any of its Subsidiaries or disclosure or presentations to Parent’s equity holders or prospective equity holders; (vi) as required by applicable Law; or (vii) to the extent such information is otherwise publicly available.
Notwithstanding anything herein to the contrary, each of the following shall be deemed to be excluded from the provisions hereof any Confidential Information that (A) has become publicly available through the actions of a Person other than the
Asset Manager, (B) is released in writing by CTT, Parent, the Company or any of its Subsidiaries to the public, or (C) is obtained by the Asset Manager from a third party without breach by such third party of an obligation of confidence
with respect to the Confidential Information disclosed. 

  
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 9. ASSET MANAGEMENT FEE. 

(a) Subject to Section 9(b), commencing upon the Effective Date, the Asset Manager shall receive from the
Company an asset management fee (the “Asset Management Fee”), calculated and payable quarterly in arrears, in an annual amount equal to (x) the Applicable Rate (as defined below) for the applicable period of time,
multiplied by (y) the Purchase Price, multiplied by (z) the Beginning Preferred Partner Ratio. In the event the Effective Date is a day other than the first calendar day of a Fiscal Quarter, the Asset Management Fee with
respect to the Fiscal Quarter in which the Effective Date occurs shall be an amount equal to the product of (x) the total Asset Management Fee otherwise payable for such Fiscal Quarter, multiplied by (y) a fraction, the numerator of which
is the number of calendar days between the Effective Date and the end of such Fiscal Quarter and the denominator of which is the total number of calendar days in such Fiscal Quarter. The “Applicable Rate” shall mean 1.00%;
provided, however, that if the entire Initial Preferred Distribution Account has not been reduced to zero ($0) in accordance with Section 3.3(d) of the Company LLC Agreement, the Applicable Rate shall (i) be reduced to 0.75% for the
four (4) consecutive Fiscal Quarters beginning with the first full Fiscal Quarter following the third (3rd) anniversary of the Effective Date, and (ii) be further reduced to 0.50% for all Fiscal Quarters after the fourth (4th) anniversary; provided, further, that to the extent that the Applicable Rate has been so reduced, and subsequent to such reduction the entire Initial Preferred Distribution Account is
reduced to zero ($0) in accordance with Section 3.3(d) of the Company LLC Agreement, then the Applicable Rate shall automatically increase back to 1.00% commencing with the day upon which such return threshold is achieved. The Asset Management
Fee, to the extent due and owing in accordance with this Agreement, the Parent LP Agreement and the Company LLC Agreement, shall be paid quarterly within forty-five (45) days following the end of the preceding Fiscal Quarter. 

(b) The payment of the Asset Management Fee shall be subject to deferral as set forth in the Parent LP Agreement and the Company LLC
Agreement. In addition, the Asset Management Fee shall be subject to reduction pursuant to the terms of Schedule 5.7 of the Parent LP Agreement. 

(c) Asset Manager acknowledges and agrees that the Company and its Subsidiaries will agree upon an allocation between each of them of
the Asset Management Fee based on the relative Services provided to each of them. 
 10. EXPENSES. 

(a) The Company or its Subsidiaries shall bear and pay (including pursuant to the terms of Section 7), the
following third-party fees, costs and expenses, whether incurred prior to or following the Effective Date (collectively, “Expenses”): 

(i) all costs and expenses incurred in connection with the formation of the Company and its Subsidiaries, and all expenses
associated with the issuance of the Subsidiary REIT Preferred Units, including any placement agent fees associated with such issuance; 

  
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 (ii) all fees, costs and expenses incurred in evaluating, negotiating,
structuring, acquiring, holding, managing, leasing, financing, refinancing, disposing of or otherwise dealing with the Property and other Business Assets, including any reasonable legal and accounting expenses and other fees and out-of-pocket costs related thereto, and the costs of rendering financial assistance to or arranging for financing for any assets or businesses constituting the Business
Assets (including the Property); 
 (iii) fees, costs and expenses of auditors, appraisers, legal counsel and other advisors
of the Company and its Subsidiaries, insurance costs of the Company and its Subsidiaries and litigation costs and indemnity expenses of the Company and its Subsidiaries; 

(iv) administrative expenses related to the operation of the Company and its Subsidiaries, including fees, costs and expenses
of accountants, lawyers and other professionals incurred in connection with the Company’s and its Subsidiaries’ annual audit, financial reporting, legal opinions and tax return preparation (including, without limitation, any costs and
expenses incurred in connection with the satisfaction of the requirements of Section 5 hereof), as well as expenses associated with valuations of the Property and other Business Assets, including the fees, costs and
expenses of any independent appraiser; 
 (v) interest expenses, brokerage commissions and other investment costs incurred by
or on behalf of the Company and its Subsidiaries; 
 (vi) the Asset Management Fee, subject to the restrictions and
limitations provided in the Parent LP Agreement and the Company LLC Agreement; 
 (vii) costs of travel and travel-related
expenses with respect to the business of the Company and its Subsidiaries; provided, that the cost of airfare shall not exceed commercial fares and, for the avoidance of doubt, shall not include costs associated with first-class, private or
chartered air travel; 
 (viii) subject to Section 10(c), all taxes and license fees levied against
the Company and its Subsidiaries or their assets or operations; 
 (ix) the costs of annual REIT compliance testing for the
Company, including fees and expenses of the Qualified REIT Consultant; 
 (x) insurance costs incurred in connection with the
operation of the business of the Company and its Subsidiaries; 
 (xi) the compensation of the employee identified on, and
subject to the limitations set forth, on Schedule C; and 
 (xii) amounts to be contributed or advanced to any
Subsidiary for the purpose of such entity paying any cost of the type described in the foregoing clauses (i) through (xi). 

  
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 (b) Notwithstanding anything herein to the contrary, the Asset Manager and its Affiliates
shall bear the costs and expenses incurred by such Persons in providing for their normal operating overhead, salaries (except as specifically provided in Section 10(a)(xi), wages or benefits of their employees, rent,
utilities, expenses of office furniture, computers and other office equipment, taxes (including taxes imposed on the income or gross receipts of the Asset Manager on account of fees received pursuant to the terms of this Agreement), other expenses
incurred in maintaining their place of business, and other similar administrative expenses (including all premiums and expense required in connection with “errors and omissions” insurance policies covering the officers and employees of the
Asset Manager or its Affiliates), neither Parent nor the Company nor any of its Subsidiaries shall pay such expenses, and Asset Manager shall not be entitled to reimbursement from Parent, the Company or its Subsidiaries for any such expenses 

(c) For the avoidance of doubt, Asset Manager shall not be reimbursed for any expenses under this Agreement. 

11. EXCULPATION AND INDEMNIFICATION. 

(a) The Asset Manager, its Affiliates and their respective Constituent Members, employees, managers, consultants and agents
(collectively, the “Manager Indemnified Parties”) will not be liable to Parent, the Company or any of their respective Subsidiaries, the Parent Board, the General Partner, the Company Board or the members, managers or partners of
Parent, the Company or any of their respective Subsidiaries for any acts or omissions by any Manager Indemnified Party, pursuant to or in accordance with this Agreement, except for any acts or omissions by any Manager Indemnified Party constituting
a Bad Act. 
 (b) To the fullest extent permitted by applicable Law, Company shall and does hereby agree to indemnify and hold
harmless and pay all judgments and claims against any Manager Indemnified Party, each of which shall be a third party beneficiary of this Agreement solely for purposes of this Section 11, from and against any Loss incurred
by them for any act or omission taken or suffered by each Manager Indemnified Party (including any act or omission performed or omitted by any of them in good faith reliance upon and in accordance with the opinion or advice of experts, including of
legal counsel as to matters of law, of accountants as to matters of accounting, or of investment bankers or appraisers as to matters of valuation; provided, that such Persons were selected and monitored with reasonable care) in connection
with in respect of or arising from any acts or omissions of such Manager Indemnified Party made in the performance of this Agreement, except that there shall be no indemnification for (i) any act or omission of a Manager Indemnified Party that
constitutes a Bad Act or (ii) any indemnification obligation of the Manager Indemnified Parties pursuant to Section 5.3(b)(iv) of the Parent LP Agreement or the Losses related thereto. 

(c) To the fullest extent permitted by applicable Law, Asset Manager shall and does hereby agree to indemnify and hold harmless and pay
all judgments and claims against Parent, the Company and its Subsidiaries and each of their respective Constituent Members, employees, managers, consultants and agents (collectively, the “Parent Indemnified Parties” and together
with the Manager Indemnified Parties, the “Indemnified Parties”), from and against any Loss incurred by them in respect of or arising from any acts or omissions by any Manager Indemnified Party pursuant to or in accordance with this
Agreement constituting a Bad Act. Each of the Parent 

  
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Indemnified Parties (excluding the Company) shall be a third party beneficiary of this Agreement solely for purposes of this Section 11. For the avoidance of doubt, for
purposes of this Section 11(c), any Loss in respect of or arising from an act by the Asset Manager in its capacity as a fiduciary under the Employee Retirement Income Security Act of 1974, as amended, and the regulations thereunder shall not
constitute a Bad Act. 
 (d) The Indemnified Party will promptly notify the party against whom indemnity is claimed (the
“Indemnitor”) of any claim for which it seeks indemnification; provided, however, that the failure to so notify the Indemnitor will not relieve the Indemnitor from any liability which it may have hereunder, except to the
extent such failure actually prejudices the Indemnitor. The Indemnitor shall have the right to assume the defense and settlement of such claim; provided, that the Indemnitor notifies the Indemnified Party of its election to assume such
defense and settlement within thirty (30) days after the Indemnified Party gives the Indemnitor notice of the claim. In such case, the Indemnified Party will not settle or compromise such claim, and the Indemnitor will not be liable for any
such settlement made, without its prior written consent. If the Indemnitor is entitled to, and does, assume such defense by delivering the aforementioned notice to the Indemnified Party, the Indemnified Party will (i) have the right to
approve the Indemnitor’s counsel (which approval will not be unreasonably withheld, delayed or conditioned), (ii) be obligated to cooperate in furnishing evidence and testimony and in any other manner in which the Indemnitor may reasonably
request, and (iii) be entitled to participate in (but not control) the defense of any such action, with its own counsel and at its own expense. In addition, if the Indemnitor assumes such defense, the Indemnitor may settle any such claim
without the prior consent of the Indemnified Party if such settlement involves the full release of the Indemnified Party and does not impose any non-monetary remedies and conditions on the
Indemnified Party without the Indemnified Party’s prior written consent, which shall not be unreasonably withheld, delayed or conditioned. 

(e) Expenses reasonably incurred by an Indemnified Party in defense or settlement of any claim that may be subject to a right of
indemnification pursuant to Section 11(b) or Section 11(c) shall be advanced by the Indemnitor prior to the final disposition thereof upon receipt of an undertaking by or on behalf of such
Indemnified Party to repay such amount to the extent that it shall be determined upon final decision, judgment or order (whether or not subject to appeal) that such Indemnified Party is not entitled to be indemnified hereunder. 

(f) If a claim for indemnification or payment of reasonable expenses hereunder is not paid in full within twenty (20) days after a
written notice of claim therefor has been received by the Indemnitor, the claimant may file suit to recover the unpaid amount of such claim and, if successful in whole or in part, shall be entitled to be paid the expenses of prosecuting such claim.

 (g) The indemnification provided by this Section 11 shall be in addition to any other rights to which an
Indemnified Party may be entitled under any agreement, pursuant to any action of the Company, as a matter of Law or otherwise, and shall continue as to an Indemnified Party who has ceased to serve in such capacity. 

  
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 12. KEY MAN EVENT. 

(a) If the employment of any Key Man terminates other than due to death, Disability (as defined in the Key Man Employment Agreement) or
Cause (as defined in the Key Man Employment Agreement), a “Key Man Event” shall have occurred. For a period of one (1) year after the occurrence of any Key Man Event, Company Board and Asset Manager shall discuss, and Company
shall reasonably consider, potential replacements for the relevant Key Man. If, after such one (1) year period, no suitable replacement for such Key Man, as determined by the Company in its reasonable discretion (acting at the direction of a
majority of the Preferred Board Members), is agreed upon by the Asset Manager and Company (acting at the direction of a majority of the Preferred Board Members), then the Company (acting at the direction of a majority of the Preferred Board Members)
may, upon written notice to the Asset Manager, immediately terminate this Agreement. 
 (b) If the employment of any Key Man
terminates due to death, Disability (as defined in the Key Man Employment Agreement) or Cause (as defined in the Key Man Employment Agreement), then Asset Manager shall use commercially reasonable efforts to identify a suitable replacement for such
Key Man within a reasonable period of time thereafter. 
 13. TERM; TERMINATION. 

(a) The term of this Agreement shall commence on the date hereof and shall continue until terminated pursuant to
Section 12 or this Section 13. 
 (b) Notwithstanding anything herein to the
contrary, this Agreement shall automatically and immediately terminate, without the requirement for any further action by any Party, upon the earliest to occur of (i) the initiation of the dissolution and liquidation of the Parent pursuant to
Article 10 of the Parent LP Agreement or the Company pursuant to the Company LLC Agreement, (ii) the removal of the General Partner as the general partner of the Parent pursuant to Section 4.13 of the Parent LP Agreement or the voluntary
resignation of the General Partner (when such General Partner is an Affiliate of CTT Partner) in such capacity, (iii) the initiation of any sale process or the initiation of any other disposition of all or substantially all of the Property and
the other Real Estate Assets pursuant to Section 4.16 of the Parent LP Agreement; provided, that the Alternative Voting System is then in effect and a Person other than the General Partner was appointed to sell the Property and manage
all aspects of the sale process, or (iv) the date that is seven years after the date hereof. 
 (c) The Company, acting at the
direction of the Preferred Board Members and acting without consent or approval of any other members of the Company Board or any other Person, may terminate this Agreement immediately upon delivery of written notice of such termination to the Asset
Manager (i) in the event that any Change of Control occurs without the prior written consent of the Company Board and (ii) for Cause. 

(d) Subject to the terms of the “Budget Variance Cure Protocols” set forth on Exhibit B hereto, the Company, acting at
the direction of the Preferred Board Members, may terminate this Agreement immediately upon delivery of written notice to the Asset Manager in the event that a Fiscal Year’s actual results (as determined following the applicable year-end) with respect to a particular Line Item (as defined in Exhibit B) are outside the applicable Allowable Variance Limits (as defined in Exhibit B). 

  
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 14. PAYMENTS DUE UPON AND FOLLOWING TERMINATION. 

(a) Upon the termination of this Agreement pursuant to Section 13(b) or
Section 13(c), the Asset Manager shall not be entitled to any further compensation hereunder following the Termination Date; provided, however, that the Asset Manager shall be entitled to receive all accrued but
unpaid Asset Management Fees as of the Termination Date (including Deferred Asset Management Fees) to the extent that the Company has funds available for such repayment, unless such termination was consummated pursuant to clause (ii) of
Section 13(b). 
 (b) In the event the Termination Date falls on a day other than the last calendar day of a
Fiscal Quarter, the Asset Management Fee payable with respect to the Fiscal Quarter in which the Termination Date occurs shall be an amount equal to the product of (x) the total Asset Management Fee otherwise payable for such Fiscal Quarter,
multiplied by (y) a fraction, the numerator of which is the number of calendar days between the start of such Fiscal Quarter and the Termination Date and the denominator of which is the total number of calendar days in such Fiscal Quarter. 

15. SURVIVAL. Notwithstanding anything herein to the contrary, the terms of Section 8,
Section 10, Section 11, Section 14 and Section 16 shall survive the termination of this Agreement. 

16. MISCELLANEOUS. 

(a) Nothing in this Agreement shall be construed to make the Company or any of its Subsidiaries or any other Person, on the one hand,
and the Asset Manager, on the other hand, partners or joint venturers or impose any liability as such on either of them. 
 (b) This
Agreement, including all schedules and exhibits attached hereto, constitutes the entire agreement among the Parties pertaining to the subject matter hereof. This Agreement supersedes any prior agreement or understanding among the Parties with
respect to the subject matter hereof, but shall not amend, modify, supersede or in any way affect any other agreement or understanding among the Parties or their Affiliates that does not relate to the subject matter hereof. 

(c) This Agreement may be amended, supplemented or waived at any time and from time to time only by an instrument in writing signed by
each Party. 
 (d) This Agreement and all disputes or controversies arising out of or relating to this Agreement or the transactions
contemplated hereby shall be governed by, and construed in accordance with, the internal laws of the State of Delaware, without regard to the laws of any other jurisdiction that might be applied because of the conflicts of laws principles of the
State of Delaware. Each Party hereby irrevocably consents and agrees that any action, suit or proceeding with respect to this Agreement shall be brought and determined only in the exclusive jurisdiction of the Court of Chancery of the State of
Delaware, the courts of the United States of America for the District of Delaware, and appellate courts thereof, and each Party hereby consents to the 

  
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jurisdiction of the aforesaid courts for itself and with respect to its property, generally and unconditionally, with regard to any such action or proceeding arising out of or relating to this
Agreement and the transactions contemplated hereby. Each Party further agrees that notice as provided herein shall constitute sufficient service of process and the Parties further waive any argument that such service is insufficient. Each Party
hereby irrevocably and unconditionally waives, and agrees not to assert, by way of motion or as a defense, counterclaim or otherwise, in any action or proceeding arising out of or relating to this Agreement or the transactions contemplated hereby,
(a) any claim that it is not personally subject to the jurisdiction of the courts in Delaware as described herein for any reason, (b) that it or its property is exempt or immune from jurisdiction of any such court or from any legal process
commenced in such courts (whether through service of notice, attachment prior to judgment, attachment in aid of execution of judgment, execution of judgment or otherwise) and (c) that (i) the suit, action or proceeding in any such court is
brought in an inconvenient forum, (ii) the venue of such suit, action or proceeding is improper or (iii) this Agreement, or the subject matter hereof, may not be enforced in or by such courts. EACH PARTY, FOR ITSELF AND ON BEHALF OF ITS
AFFILIATES, HEREBY WAIVES ITS RIGHT TO TRIAL BY JURY IN ANY ACTION, LAWSUIT, OR PROCEEDING, WHETHER IN CONTRACT OR IN TORT, RELATING TO ANY DISPUTE ARISING UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY TRANSACTION DESCRIBED IN THIS AGREEMENT OR
TO ANY DISPUTE BETWEEN THE PARTIES (INCLUDING DISPUTES WHICH ALSO INVOLVE OTHER PERSONS). 
 (e) This Agreement shall be binding upon
and inure to the benefit of the Parties and their permitted successors and assigns. 
 (f) The rights and obligations under this
Agreement may not be assigned or delegated (whether by operation of law, merger, consolidation or otherwise) by any Party without the prior written consent of the other Parties, and any attempted assignment without such prior written consent shall
be null and void and of no force or effect; provided, however, that the Asset Manager shall be entitled, without the consent of the other Parties hereto, to assign its right, title and interest in and to this Agreement to any lender or other
creditor as collateral security for indebtedness of the Asset Manager or its Affiliates to such lender or other creditor. The Parties hereto hereby consent and agree that such lender or other creditor has the right to assert and enforce any or all
of the rights of the Asset Manager collaterally assigned to such lender or creditor in accordance with the terms and provisions of the related indebtedness. The Parties hereto agree and acknowledge that none of such lender or other creditor shall be
deemed to have assumed any of the obligations or liabilities of the Asset Manager under this Agreement by reason of such collateral assignment. 

(g) Subject to Section 11, the provisions of this Agreement are for the sole and exclusive benefit of the
Parties and their permitted successors and assigns and shall not be deemed to create any rights for the benefit of any other Person except as specifically provided herein. 

(h) If any provision of this Agreement or the application of such provision to any Party or circumstance shall be held invalid or
unenforceable, the remainder of this Agreement or the application of that provision to another Party or circumstance shall not be affected thereby. 

  
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 (i) No waiver by a Party of any default, breach or violation of this Agreement shall be
deemed to be a waiver of any other default, breach or violation of any kind or nature, whether or not similar to the default, breach or violation that has been waived, and no failure to enforce a particular provision in one instance shall be deemed
a waiver or modification of rights or preclude the enforcement thereafter. No acceptance of payment or performance by a Party after any such default, breach or violation shall be deemed to be a waiver of any default, breach or violation of this
Agreement, whether or not such Party knows of such default, breach or violation at the time it accepts such payment or performance. Subject to any applicable statutes of limitation, no failure or delay on the part of a Party to exercise any right it
may have under this Agreement shall prevent its exercise by such Party, and no such failure or delay shall operate as a waiver of any default, breach or violation of this Agreement. 

(j) The captions and headings used in this Agreement are for convenience only and do not in any way affect, limit, amplify or modify the
terms and provisions hereof. 
 (k) This Agreement may be executed in several counterparts. If so executed, each of such counterparts
shall be deemed an original for all purposes and all counterparts shall, collectively, constitute one agreement. In making proof of this Agreement, it shall not be necessary to produce or account for more than one such counterpart and photocopies
may be used. 
 (l) Notwithstanding anything herein to the contrary, this may not be amended or modified in a manner that is material
and adverse to the interests of the Senior Lender (or the other secured parties under the Senior Credit Documents) without the prior written approval of the Senior Lender. 

Remainder of page left intentionally blank; signature pages follow. 

  
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 IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by their
representatives thereunto duly authorized effective as of the day and year first above written. 
  

					
	CREEK PINE REIT, LLC
	
	By: TEXMARK TIMBER TREASURY, L.P., its sole member
			
		 	By:	 	 /s/ John F. Rasor

		 	Name:	 	John F. Rasor
		 	Title:	 	President

 [Signature Page to Asset Management Agreement] 

 
			
	 CROWN PINE REALTY 1, INC.,
 a
Delaware corporation

		
	By:	 	 /s/ John F. Rasor

	Name:	 	John F. Rasor
	Title:	 	President

 [Signature Page to Asset Management Agreement] 

 
			
	CATCHMARK TRS CREEK MANAGEMENT, LLC
	
	By: CatchMark Timber TRS, Inc., its sole member
		
	By:	 	 /s/ Brian M. Davis

	Name:	 	 Brian M. Davis

	Title:	 	Senior Vice President and Chief Financial Officer

 [Signature Page to Asset Management Agreement] 

 Schedule A 

Key Man 
 1. Key Man: Jerry Barag 

2. Key Man Employment Agreement: Employment Agreement by and between CatchMark Timber Trust, Inc. and Jerry Barag 

 Schedule B-1 

Initial Annual Budget 

(See attached.) 

 Project Caddo 

Schedule B-1: Initial Annual Budget 
  

($‘s, except per acre data) 
 NOTE: BASIS OF
PRESENTATION IS ON A CASH BASIS 
 [***] 
  

  
 Portions of the exhibit, indicated
by the mark “[***],” were omitted and have been filed separately with the Securities and Exchange Commission pursuant to the Registrant’s application requesting confidential treatment pursuant to Rule 24b-2 of the Securities Exchange
Act of 1934, as amended. 
 Schedule B-1 

 Schedule B-2 

Budget Development Protocol 
 • The
Asset Manager will produce an annual harvest schedule (“Annual Harvest Schedule”), taking into consideration (i) the Company’s obligations under the Wood Supply Agreements, (ii) Unlevered Cash Flow requirements,
(iii) the long-term value of the Property and (iv) Sustainable Forestry Initiative (SFI) obligations. 
 • The Preferred Partners, by a
majority vote of the Board Members designated by the Preferred Partners, may designate a Person to provide reasonable review and input regarding the following items during the preparation of the Annual Harvest Schedule: Linear Program (LP)
constraints, financial assumptions, silvicultural assumptions, and harvest volume in excess of or outside of Wood Supply Agreement obligations. The initial such designee shall be TTG Forestry Services, LLC. 

• Each Annual Harvest Schedule will include a thirty (30) year harvest schedule (“Thirty-Year Harvest Schedule”) and a rolling
three (3) year harvest plan (“Three-Year Harvest Plan”). A written summary of each Annual Harvest Schedule will be made available to the Company Board, including all assumptions, constraints utilized, and supporting stand level
information as may be necessary for a reasonable evaluation of the Thirty-Year Harvest Schedule and the Three-Year Harvest Plan. In addition, annual property profiles including merchantable timber volumes,
pre-merchantable acres by species and age class, and acres by land class shall be provided. 
 • To the extent
necessary to facilitate the Company Board’s review of the proposed Annual Budget, the Asset Manager will also (i) provide the Company Board information regarding tract and stand-level activity for the Property and applicable other Real
Estate Assets (including, for example, site preparation and treatment, planting method, stock type, planting density, thinning plan, volume removals by product class, and detailed inventory information) and (ii) furnish the Company Board a copy
of the then current Geographic Information Systems (GIS) data for the Property and applicable other Real Estate Assets. 
 • The Asset Manager will
seek, based on the Three-Year Harvest Plan, to develop a preliminary version of the Annual Budget (“Preliminary Budget”) and present such Preliminary Budget to the Company Board no later than September 10th of each calendar year for
review and consideration. 
 • The Company Board will provide any comments and feedback regarding the Preliminary Budget no later than September 25th
of each calendar year. 
 • Based on the Preliminary Budget timber volumes (as the same reflects the comments and feedback of the Board) the Asset
Manager will provide the “Annual Plan” and “Forecast Plan” volumes to the respective counterparties to the Wood Supply Agreements, as required, on or before September 30th of each calendar year. 

 • The proposed Annual Budget submitted to the Company Board for final approval pursuant to
Section 3 of this Agreement will reflect any changes required by the counterparties to the Wood Supply Agreements after review of the Annual Plan volumes. 

• The Annual Budget will include the terms pertaining to any Permitted HBU Sale to be conducted during the applicable Fiscal Year, including (i) a
general description of the Property and other Real Estate Assets to be sold, (ii) the minimum price and (iii) any permissible non-standard commercial terms.  

 Schedule B-3 

Pre-Funded Reserves 

(See attached.) 

 Project Caddo 

Schedule B-3: Pre-Funded Reserves 
  

($‘s, except per acre data) 
 NOTE: BASIS OF
PRESENTATION IS ON A CASH BASIS 
 [***] 
  

  
 Portions of the exhibit, indicated
by the mark “[***],” were omitted and have been filed separately with the Securities and Exchange Commission pursuant to the Registrant’s application requesting confidential treatment pursuant to Rule 24b-2 of the Securities Exchange
Act of 1934, as amended. 
 Schedule B-3 

 Schedule B-4 

Operating Metrics 
 1. Recordable incident
rate 
 2. Conformity with certification requirements provided by Sustainable Forestry Initiative Inc. 

3. Development of managerial talent 
 4. Litigation risk 

5. Compliance with applicable environmental statutes and regulations 

6. Technology and information systems infrastructure 

 Schedule C 

Employees 
  

	1.	 John Rasor, in the amount of up to $500,000 annually, but only to the extent he is performing the Services. The
Parties acknowledge and agree that this amount shall be considered by the Company as an expense within the “Forestry Management” line item of the applicable Annual Budget. 

 Exhibit A 

Allowable Variances 
  

					
	 Item
	  	Minimum	  	Maximum
	 Plantation Clearcut Acres
	  	[***]	  	[***]

	 Total GP/IP WSA Volume
	  	[***]	  	[***]
	 Weighted Age of Plantation Clearcuts
	  	[***]	  	[***]
	 Hardwood Release
	  	[***]	  	[***]
	 Mid Rotation Fertilization
	  	[***]	  	[***]
	 Road Maintenance
	  	[***]	  	[***]
	 Site Prep + Plant + Seedlings + Herbaceous Weed Control
	  	[***]	  	[***]
	 Fertilization at Establishment
	  	[***]
	  	[***]
	 Capital Infrastructure Expenses, including bridges, culverts and road construction
	  	[***]	  	[***]

 Exhibit B 

Budget Variance Cure Protocols 
  

	1.	 If the actual results for a Fiscal Year (as determined following the applicable
year-end) reflect a variance (measured against the applicable Annual Budget) (a “Budget Variance”) above or below the “Minimum” or “Maximum” values set forth
on Exhibit C hereto (the “Allowable Variance Limits”) with respect to any of the line items set forth on Exhibit C (each, a “Line Item”), then the Asset Manager will, simultaneously with the delivery
of the results of such Fiscal Year, provide the Company Board with a written notice (a “Budget Variance Notice”) setting forth in reasonable detail: 

 

	 	(i)	 a description of such Line Item and the amount of the Budget Variance; 

 

	 	(ii)	 the underlying causes of the Budget Variance, including (A) a Force Majeure Event (as defined below), (B)
market issues, (C) regulatory or environmental compliance, (D) SFI compliance, or (E) such other causes as the Asset Manager identifies (each, a “Notice Event”); and 

 

	 	(iii)	 if the Budget Variance is due to a Force Majeure Event, recommendations for reducing or eliminating the amount
of the anticipated Budget Variance and the appropriate cure period (not to exceed the applicable cure period set forth opposite such Line Item on Exhibit C hereto) (each, a “Proposed Variance Cure”), including (A) a
description of the actions required to implement each Proposed Variance Cure, (B) the financial implications of each Proposed Variance Cure, (C) an estimated timeline to implement each Proposed Variance Cure, and (D) the Asset
Manager’s preferred Proposed Variance Cure. 

 As used above, “Force Majeure Event” means any
(i) any Change Event (as defined in the applicable Wood Supply Agreement) under a Wood Supply Agreement or (ii) the occurrence of a Force Majeure (as defined in the applicable Wood Supply Agreement) under a Wood Supply Agreement. 

 

	2.	 If the Notice Event identified in the Budget Variance Notice is a Force Majeure Event (in which case such
Budget Variance Notice is referred to herein as a “Force Majeure Budget Variance Notice”), then, subject to the remaining provisions of this Exhibit B, the Company Board may not immediately terminate this Agreement pursuant
to Section 13(d) with respect to the Line Item identified in such Force Majeure Budget Variance Notice. If, however, the Notice Event identified in the Budget Variance Notice is not a Force Majeure Event, then the Company Board shall have the
right to immediately terminate this Agreement pursuant to Section 13(d). 

  

	3.	 Upon delivery of a Force Majeure Budget Variance Notice, the Company Board and the Asset Manager will work
together in good faith for a period of 45 days to approve a Proposed Variance Cure, either as originally presented in the Force Majeure Budget Variance Notice or subject to such modifications as the Company Board and the Asset Manager mutually agree
upon. 

  
 B-1 

	4.	 If a Proposed Variance Cure is agreed within the 45-day period set
forth in paragraph 3 above (an “Agreed Variance Cure”), then the Asset Manager shall implement such Agreed Variance Cure within the applicable cure period. If the Asset Manager fails to implement the Agreed Variance Cure within the
applicable cure period, then the Company Board shall have the right to immediately terminate this Agreement in accordance with Section 13(d). 

  

	5.	 If a Proposed Variance Cure is not agreed within the 45-day period set
forth in paragraph 3 above, then the Asset Manager will in good faith implement the Proposed Variance Cure that the Company Board determines is in the best interests of the Company, taking into account long-term asset value (the
“Company-Determined Variance Cure”). The Company Board shall have the right to immediately terminate this Agreement if the Asset Manager fails to implement a Company-Determined Variance Cure within the applicable cure period.

  

	6.	 Notwithstanding anything to the contrary contained herein, (i) all actions of the Company Board hereunder
shall be taken as a Major Decision, and (ii) with respect to any of the Line Items under the heading “Seasonal Events” on Exhibit C hereto, if the Asset Manager fails to implement the Annual Budget within the parameters
set forth in the applicable Annual Variance Limits for a period of two (2) consecutive Fiscal Years (a “Two Year Seasonal Line Item Implementation Failure”), then the Company Board shall have the right to immediately terminate
this Agreement pursuant to Section 13(d) (notwithstanding any Budget Variance Notices); provided, however, that if in each of such two (2) consecutive Fiscal Years, (x) a named hurricane or tropical storm (in each case,
affecting at least 10% of the total acres of the Parent and its Subsidiaries by acreage) or (y) disease, insect infestation, wind, ice or fire (in each case, affecting at least 5,000 acres of harvest units in the current 3-year harvest plan of the Company) has occurred, and the Asset Manager has delivered Budget Variance Notices that identify such events as the Notice Events, then the Company Board shall not have the right to
terminate this Agreement with respect to such Two Year Seasonal Line Item Implementation Failure. 

  

	7.	 Notwithstanding anything to the contrary contained herein, if, during a Fiscal Year, the Asset Manager in good
faith determines that it is reasonably likely that a Budget Variance will exist with respect to a Line Item, then the Asset Manager may provide the Company Board with a written notice setting forth, in reasonable detail (1) a description of
such Line Item, (2) an estimate of the amount of the anticipated Budget Variance, and (3) a description of the underlying Notice Event (an “Expected Variance”), and the Company Board may, as a Major Decision, approve or
disapprove such Expected Variance. If the Company Board approves an Expected Variance, then, notwithstanding anything to the contrary contained herein, the Company Board’s right to terminate this Agreement pursuant to Section 13(d) shall
be waived to the extent of such Expected Variance with respect to such Fiscal Year. 

 All capitalized terms used and not otherwise defined
herein shall have the meanings given to them in the Agreement. 

  
 B-2 

 Exhibit C 

Variance Termination Triggers 
  

							
	 Non-Seasonal
Events
	  	Minimum	 	Maximum	 	 Cure Period for Force Majeure Event

	 Hardwood Release + mid rotation fertilization
	  	[***]	 	[***]	 	 365 days from end of Fiscal Year

	 Road Maintenance
	  	[***]	 	[***]	 	 180 days from end of Fiscal Year

	 Capital Infrastructure (incl. bridges, culverts, road construction)
	  	[***]	 	[***]	 	 180 days from end of Fiscal Year

	Seasonal events	  	 	 	 	 	 
	 Total GP/IP WSA
	  	[***]	 	[***]	 	 No cure if outside variance for 2 successive years

	 Plantation Clearcut Acres
	  	[***]	 	[***]	 	 No cure if outside variance for 2 successive years

	 Weighted Age of plantation Clearcuts
	  	[***]	 	[***]	 	 No cure if outside variance for 2 successive years

	 Site Prep + Plant + Seedlings + Herbaceous Weed Control
	  	[***]	 	[***]	 	 No cure if outside variance for 2 successive years

	 Fertilization at Establishment
	  	[***]	 	[***]	 	 No cure if outside variance for 2 successive years

  

	(1)	 Notwithstanding anything herein to the contrary, variances attributable to
Non-Controllable Expenses (as defined in the Parent LP Agreement) shall not be counted towards determining whether there is a variance above or below the Annual Budget. 

	(2)	 Measured on an annual basis based upon the applicable annual financial and operational information presented by
the Asset Manager to the Company Board within forty-five (45) days of the end of each Fiscal Year. 

	(3)	 Cure period for the Line Items under the heading “Seasonal Events” to be agreed-upon by the
Company Board and the Asset Manager in accordance with clause (c) of Exhibit B; provided, that if the cure period cannot be timely agreed upon, then the cure period shall be as set forth above. 

Portions of the exhibit, indicated by the mark “[***],” were omitted and have been filed separately with the Securities and Exchange
Commission pursuant to the Registrant’s application requesting confidential treatment pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended.Exhibit 4.1

 

NEITHER THE ISSUANCE NOR SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE CONVERTIBLE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES FILED PURSUANT TO THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE HOLDER), IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT.  NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES.

 

THIS NOTE IS ISSUED WITH ORIGINAL ISSUE DISCOUNT FOR PURPOSES OF SECTION 1271 ET SEQ. OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED. PURSUANT TO TREASURY REGULATION SECTION 1.1275-3, A HOLDER MAY OBTAIN THE ISSUE PRICE, AMOUNT OF ORIGINAL ISSUE DISCOUNT, ISSUE DATE, AND YIELD TO MATURITY FOR THIS NOTE BY SUBMITTING A WRITTEN REQUEST FOR SUCH INFORMATION TO THE BORROWER AT THE FOLLOWING ADDRESS: 201 MISSION STREET, SUITE 2375, SAN FRANCISCO, CALIFORNIA 94105.

 

	
Principal Amount: $455,000.00
    	
Issue Date: September 11,   2018
    

 

CONVERTIBLE PROMISSORY NOTE

 

FOR VALUE RECEIVED, JAGUAR HEALTH, INC., a Delaware corporation (hereinafter called the “Borrower”), hereby promises to pay to the order of L2 CAPITAL, LLC, a Kansas limited liability company, or its registered assigns (the “Holder”) the principal sum of $455,000.00 (the “Principal Amount”), together with interest at the rate of eight percent (8%) per annum, at maturity or upon acceleration or otherwise, as set forth herein (this “Note”) (with the understanding that the initial six months of such interest shall be guaranteed).  This Note is being issued by the Borrower to the Holder pursuant to that certain Securities Purchase Agreement (the “SPA”) entered into on or around September 11, 2018 (the “Issue Date”). The full consideration paid to the Borrower for this Note is $400,000.00, due to an original issuance discount of $55,000.00 (the “OID”), and such OID shall be applied in full upon the issuance of the Note on the Issue Date.  At the Issue Date, the outstanding Principal Amount under this Note shall be $455,000.00.  The maturity date of this Note shall be six (6) months from the Issue Date (the “Maturity Date”), and is the date upon which the principal sum, as well as any accrued and unpaid interest and other fees, shall be due and payable.  This Note may not be repaid in whole or in part except as otherwise explicitly set forth herein.  Any amount of principal or interest on this Note, which is not paid by the Maturity Date, shall bear interest at the rate of the lesser of (i) eighteen percent (18%) per annum or (ii) the maximum amount allowed by law, from the due date thereof until the same is paid (“Default Interest”).  Interest shall commence accruing on the date that this Note is issued and shall be computed on the basis of a 365-day year and the actual number of days elapsed.  All payments due hereunder (to the extent not converted into the Borrower’s voting common stock, par value $0.0001 per share (the “Common Stock”) in accordance with the terms hereof) shall be made in lawful money of the United States of America.  All payments shall be made at such address as the Holder shall hereafter give to the Borrower by written notice made in accordance with the provisions of this Note. Whenever any amount expressed to be due by the terms of this Note is due on any day which is not a business day, the same shall instead be due on the next succeeding day which is a business day and, in the case of any interest payment date which is not the date on which this Note is paid in full, the extension of the due date thereof shall not be taken into account for purposes of determining the amount of interest due on such date.  As used in this Note, the term “business day” shall mean any day other than a Saturday, Sunday or a day on which commercial banks in the city of New York, New York are authorized or required by law or executive order to remain closed.

 

1

 

This Note is free from all taxes, liens, claims and encumbrances with respect to the issue thereof and shall not be subject to preemptive rights or other similar rights of shareholders of the Borrower and will not impose personal liability upon the holder thereof.

 

The following additional terms shall also apply to this Note:

 

ARTICLE I. CONVERSION RIGHTS

 

1.1                               Conversion Right.  If the Borrower fails to repay this Note on or prior to the Maturity Date, the Holder shall have the right, at any time after the Maturity Date, to convert all or any part of the outstanding and unpaid Principal Amount and accrued and unpaid interest of this Note into fully paid and non-assessable shares of Common Stock, as such Common Stock exists on the Issue Date, or any shares of capital stock or other securities of the Borrower into which such Common Stock shall hereafter be changed or reclassified at the Conversion Price determined as provided herein (a “Conversion”); provided, however, that in no event shall the Holder be entitled to convert any portion of this Note in excess of that portion of this Note upon conversion of which the sum of (1) the number of shares of Common Stock beneficially owned by the Holder and its affiliates (other than shares of Common Stock which may be deemed beneficially owned through the ownership of the unconverted portion of this Note or the unexercised or unconverted portion of any other security of the Borrower subject to a limitation on conversion or exercise analogous to the limitations contained herein) and (2) the number of shares of Common Stock issuable upon the conversion of the portion of this Note with respect to which the determination of this proviso is being made, would result in beneficial ownership by the Holder and its affiliates of more than 4.99% of the outstanding shares of Common Stock (the “Maximum Share Amount”).  The Holder, upon not less than 61 days’ prior written notice to the Company, may increase the Maximum Share Amount, provided that the Maximum Share Amount shall never exceed 9.99% of the number of shares of Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock upon conversion of this Note held by the Holder and the provisions of this Section 1.1 shall continue to apply.  Any such increase will not be effective until the 61st day after such notice is delivered to the Company.  The Maximum Share Amount provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this Section 1.1 to correct this paragraph (or any portion hereof) which may be defective or inconsistent with the intended Maximum Share Amount provisions contained herein or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitations contained in this paragraph shall apply to a successor holder of this Note. For purposes of this Section 1.1, beneficial ownership shall be determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and Regulations 13D-G thereunder, except as otherwise provided in clause (1) of such proviso.  The number of shares of Common Stock to be issued upon each conversion of this Note shall be determined by dividing the Conversion Amount (as defined below) by the applicable Conversion Price then in effect on the date specified in the notice of conversion, in the form attached hereto as Exhibit A (the “Notice of Conversion”), delivered to the Borrower by the Holder in accordance with Section 1.3 below; provided that the Notice of Conversion is submitted by facsimile or e-mail (or by other means resulting in, or reasonably expected to result in, notice) to the Borrower before 6:00 p.m., New York, New York time on such conversion date (the “Conversion Date”).  The term “Conversion Amount” means, with respect to any conversion of this Note, the sum of (1) the Principal Amount of this Note to be converted in such conversion, plus (2) at the Holder’s option, accrued and unpaid interest, if any, on such Principal Amount at the interest rates provided in this Note to the Conversion Date, plus (3) at the Holder’s option, Default Interest, if any, on the amounts referred to in the immediately preceding clauses (1) and/or (2), plus (4) at the Holder’s option, any amounts owed to the Holder pursuant to Sections 1.2,  1.3(g) , 4.11, and/or 4.12 and/or Article III hereof. Notwithstanding anything in this Note to the contrary, and in addition to the beneficial ownership limitations provided herein above, the total number of shares of Common Stock that may be issued under this Note, shall be limited to 19.99% of the Borrower’s outstanding shares of Common Stock as of the Issuance Date hereof (the “Exchange Cap”), unless (i) stockholder approval is obtained to issue more than the Exchange Cap or (ii) the Common Stock is not listed for quotation on Nasdaq or NYSE American. The Exchange Cap shall be appropriately adjusted for any reorganization, recapitalization, non-cash dividend, stock split, reverse stock split or other similar transaction.

 

2

 

1.2                               Conversion Price.

 

(a)                                 Calculation of Conversion Price.  The “Conversion Price” per share shall be $0.85. Each time, while this Note is outstanding, the Borrower enters into a Section 3(a)(9) Transaction (including but not limited to the issuance of new promissory notes or of a replacement promissory note), or Section 3(a)(10) Transaction, in which any 3rd party has a look back/holding period greater than the look back/holding period in effect under this Note at that time, then the Holder’s look back/holding period may be adjusted at the option of the Holder to such greater number of days until this Note is no longer outstanding to the extent allowed under applicable law.  The Borrower shall give written notice to the Holder, with the adjusted look back/holding period (each adjustment that is applicable due to the triggering event), within one (1) business day of an event that requires any adjustment described in the immediately preceding sentence, and the Holder shall have the sole discretion in determining whether to utilize the adjusted term pursuant to this section.

 

(b)                                 Authorized Shares.  The Borrower covenants that during the period the conversion right exists, the Borrower will reserve from its authorized and unissued Common Stock a sufficient number of shares, free from preemptive rights, to provide for the issuance of Common Stock upon the full conversion of this Note, and, in the event that the Borrower has not repaid this Note within sixty (60) days following the Issue Date, the Borrower must authorize and reserve three times (300%) the number of shares that is actually issuable upon full conversion of this Note (based on the Conversion Price of this Note in effect from time to time) (the “Reserved Amount”).  The Reserved Amount shall be increased from time to time in accordance with the Borrower’s obligations hereunder.  The Borrower represents that upon issuance, such shares of Common Stock will be duly and validly issued, fully paid and non-assessable.  In addition, if the Borrower shall issue any securities or make any change to its capital structure which would change the number of shares of Common Stock into which this Note shall be convertible at the Conversion Price, the Borrower shall at the same time make proper provision so that thereafter there shall be a sufficient number of shares of Common Stock authorized and reserved, free from preemptive rights, for conversion of the outstanding Notes.  The Borrower acknowledges that it has irrevocably instructed its transfer agent to issue certificates for the Common Stock issuable upon conversion of this Note, and agrees that its issuance of this Note shall constitute full authority to its officers and agents who are charged with the duty of executing stock certificates to execute and issue the necessary certificates for shares of Common Stock in accordance with the terms and conditions of this Note.

 

If, at any time the Borrower does not maintain the Reserved Amount it will be considered an Event of Default under Section 3.2 of this Note.

 

3

 

1.3                               Method of Conversion.

 

(a)                                 Mechanics of Conversion.  Subject to Section 1.1, this Note may be converted by the Holder in whole or in part at any time on or after the Maturity Date, (A) by submitting to the Borrower a Notice of Conversion (by facsimile, e-mail or other reasonable means of communication dispatched on the Conversion Date prior to 6:00 p.m., New York, New York time) and (B) subject to Section 1.3(b), surrendering this Note at the principal office of the Borrower.

 

(b)                                 Surrender of Note Upon Conversion.  Notwithstanding anything to the contrary set forth herein, upon conversion of this Note in accordance with the terms hereof, the Holder shall not be required to physically surrender this Note to the Borrower unless the entire unpaid Principal Amount of this Note is so converted.  The Holder and the Borrower shall maintain records showing the Principal Amount so converted and the dates of such conversions or shall use such other method, reasonably satisfactory to the Holder and the Borrower, so as not to require physical surrender of this Note upon each such conversion.  In the event of any dispute or discrepancy, such records of the Borrower shall, prima facie, be controlling and determinative in the absence of manifest error.  Notwithstanding the foregoing, if any portion of this Note is converted as aforesaid, the Holder may not transfer this Note unless the Holder first physically surrenders this Note to the Borrower, whereupon the Borrower will forthwith issue and deliver upon the order of the Holder a new Note of like tenor, registered as the Holder (upon payment by the Holder of any applicable transfer taxes) may request, representing in the aggregate the remaining unpaid Principal Amount of this Note.  The Holder and any assignee, by acceptance of this Note, acknowledge and agree that, by reason of the provisions of this paragraph, following conversion of a portion of this Note, the unpaid and unconverted Principal Amount of this Note represented by this Note may be less than the amount stated on the face hereof.

 

(c)                                  Payment of Taxes.  The Borrower shall not be required to pay any tax which may be payable in respect of any transfer involved in the issue and delivery of shares of Common Stock or other securities or property on conversion of this Note in a name other than that of the Holder (or in street name), and the Borrower shall not be required to issue or deliver any such shares or other securities or property unless and until the person or persons (other than the Holder or the custodian in whose street name such shares are to be held for the Holder’s account) requesting the issuance thereof shall have paid to the Borrower the amount of any such tax or shall have established to the satisfaction of the Borrower that such tax has been paid.

 

(d)                                 Delivery of Common Stock Upon Conversion.  Upon receipt by the Borrower from the Holder of a facsimile transmission or e-mail (or other reasonable means of communication) of a Notice of Conversion meeting the requirements for conversion as provided in this Section 1.3, the Borrower shall issue and deliver or cause to be issued and delivered to or upon the order of the Holder certificates for the Common Stock issuable upon such conversion within three (3) business days after such receipt (the “Deadline”) (and, solely in the case of conversion of the entire unpaid Principal Amount hereof, surrender of this Note) in accordance with the terms hereof.

 

(e)                                  Obligation of Borrower to Deliver Common Stock.  Upon receipt by the Borrower of a Notice of Conversion, the Holder shall be deemed to be the holder of record of the Common Stock issuable upon such conversion, the outstanding Principal Amount and the amount of accrued and unpaid interest on this Note shall be reduced to reflect such conversion, and, unless the Borrower defaults on its obligations under this Article I, all rights with respect to the portion of this Note being so converted shall forthwith terminate except the right to receive the Common Stock or other securities, cash or other assets, as herein provided, on such conversion.  If the Holder shall have given a Notice of Conversion as provided herein, the Borrower’s obligation to issue and deliver the certificates for Common Stock shall be absolute and unconditional, irrespective of the absence of any action by the Holder to enforce the same, any waiver or consent with respect to any provision thereof, the recovery of any judgment against any person or any action to enforce the same, any failure or delay in the enforcement of any other obligation of the Borrower to the holder of record, or any setoff, counterclaim, recoupment, limitation or termination, or any breach or alleged breach by the Holder of any obligation to the Borrower, and irrespective of any other circumstance which might otherwise limit such obligation of the Borrower to the Holder in connection with such conversion.  The Conversion Date specified in the Notice of Conversion shall be the Conversion Date so long as the Notice of Conversion is received by the Borrower before 6:00 p.m., New York, New York time, on such date.

 

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(f)                                   Delivery of Common Stock by Electronic Transfer.  In lieu of delivering physical certificates representing the Common Stock issuable upon conversion, provided the Borrower is participating in the Depository Trust Company (“DTC”) Fast Automated Securities Transfer (“FAST”) program, upon request of the Holder and its compliance with the provisions contained in Sections 1.1 and 1.2 and in this Section 1.3, the Borrower shall use its best efforts to cause its transfer agent to electronically transmit the Common Stock issuable upon conversion to the Holder by crediting the account of Holder’s Prime Broker with DTC through its Deposit Withdrawal Agent Commission (“DWAC”) system.

 

(g)                                  Failure to Deliver Common Stock Prior to Deadline.  Without in any way limiting the Holder’s right to pursue other remedies, including actual damages and/or equitable relief, the parties agree that if delivery of the Common Stock issuable upon conversion of this Note is not delivered by the Deadline the Borrower shall pay to the Holder $3,000 per day, for each day beyond the Deadline that the Borrower fails to deliver such Common Stock (unless such failure results from war, acts of terrorism, an epidemic, or natural disaster) (“Conversion Default Payments”).  Such amount shall be paid to Holder in cash by the fifth day of the month following the month in which it has accrued or, at the option of the Holder (by written notice to the Borrower by the first day of the month following the month in which it has accrued), shall be added to the Principal Amount of this Note on the fifth day of the month following the month in which it has accrued, in which event interest shall accrue thereon in accordance with the terms of this Note and such additional Principal Amount shall be convertible into Common Stock in accordance with the terms of this Note.  The Borrower agrees that the right to convert is a valuable right to the Holder.  The damages resulting from a failure, attempt to frustrate, interference with such conversion right are difficult if not impossible to qualify.  Accordingly the parties acknowledge that the liquidated damages provision contained in this Section 1.3(g) are justified.

 

1.4                               Concerning the Shares.  The shares of Common Stock issuable upon conversion of this Note may not be sold or transferred unless (i) such shares are sold pursuant to an effective registration statement under the Securities Act of 1933, as amended (the “Securities Act”), or (ii) the Borrower or its transfer agent shall have been furnished with an opinion of counsel (which opinion shall be in form, substance and scope customary for opinions of counsel in comparable transactions) to the effect that the shares to be sold or transferred may be sold or transferred pursuant to an exemption from such registration or (iii) such shares are sold or transferred pursuant to Rule 144 under the Securities Act (or a successor rule) (“Rule 144”) or (iv) such shares are transferred to an “affiliate” (as defined in Rule 144) of the Borrower who agrees to sell or otherwise transfer the shares only in accordance with this Section 1.4 and who is an “accredited investor” (as defined in Rule 501(a) of the Securities Act).  Except as otherwise provided (and subject to the removal provisions set forth below), until such time as the shares of Common Stock issuable upon conversion of this Note have been registered under the Securities Act or otherwise may be sold pursuant to Rule 144 without any restriction as to the number of securities as of a particular date that can then be immediately sold, each certificate for shares of Common Stock issuable upon conversion of this Note that has not been so included in an effective registration statement or that has not been sold pursuant to an effective registration statement or an exemption that permits removal of the legend, shall bear a legend substantially in the following form, as appropriate:

 

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“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS.  THE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS, UNLESS SOLD PURSUANT TO: (1) RULE 144 UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (2) AN OPINION OF HOLDER’S COUNSEL, IN A CUSTOMARY FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR APPLICABLE STATE SECURITIES LAWS.”

 

The legend set forth above shall be removed and the Borrower shall issue to the Holder a new certificate therefore free of any transfer legend if (i) the Borrower or its transfer agent shall have received an opinion of counsel, in form, substance and scope customary for opinions of counsel in comparable transactions, to the effect that a public sale or transfer of such Common Stock may be made without registration under the Securities Act, which opinion shall be accepted by the Borrower so that the sale or transfer is effected or (ii) in the case of the Common Stock issuable upon conversion of this Note, such security is registered for sale by the Holder under an effective registration statement filed under the Securities Act or otherwise may be sold pursuant to Rule 144 without any restriction as to the number of securities as of a particular date that can then be immediately sold.

 

1.5                               Status as Shareholder.  Upon submission of a Notice of Conversion by a Holder, (i) the shares covered thereby (other than the shares, if any, which cannot be issued because their issuance would exceed such Holder’s allocated portion of the Reserved Amount or non-waived Maximum Share Amount) shall be deemed converted into shares of Common Stock and (ii) the Holder’s rights as a Holder of such converted portion of this Note shall cease and terminate, excepting only the right to receive certificates for such shares of Common Stock and to any remedies provided herein or otherwise available at law or in equity to such Holder because of a failure by the Borrower to comply with the terms of this Note.  Notwithstanding the foregoing, if a Holder has not received certificates or transmission of such shares pursuant to Section 1.3(f) for all shares of Common Stock prior to the tenth (10th) business day after the expiration of the Deadline with respect to a conversion of any portion of this Note for any reason, then (unless the Holder otherwise elects to retain its status as a holder of Common Stock by so notifying the Borrower) the Holder shall regain the rights of a Holder of this Note with respect to such unconverted portions of this Note and the Borrower shall, as soon as practicable, return such unconverted Note to the Holder or, if this Note has not been surrendered, adjust its records to reflect that such portion of this Note has not been converted.  In all cases, the Holder shall retain all of its rights and remedies (including, without limitation, (i) the right to receive Conversion Default Payments pursuant to Section 1.3(g) to the extent required thereby for such conversion default and any subsequent conversion default and (ii) the right to have the Conversion Price with respect to subsequent conversions determined in accordance with Section 1.2) for the Borrower’s failure to convert this Note.

 

ARTICLE II. CERTAIN COVENANTS

 

2.1                               Distributions on Capital Stock.  So long as the Borrower shall have any obligation under this Note, the Borrower shall not without the Holder’s written consent (a) pay, declare or set apart for such payment, any dividend or other distribution (whether in cash, property or other securities) on shares of capital stock other than dividends on shares of Common Stock solely in the form of additional shares of Common Stock or (b) directly or indirectly make any other payment or distribution in respect of its capital stock except for distributions pursuant to any shareholders’ rights plan which is approved by a majority of the Borrower’s disinterested directors.

 

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2.2                               Restriction on Stock Repurchases.  So long as the Borrower shall have any obligation under this Note, the Borrower shall not without the Holder’s written consent redeem, repurchase or otherwise acquire (whether for cash or in exchange for property or other securities or otherwise) in any one transaction or series of related transactions any shares of capital stock of the Borrower or any warrants, rights or options to purchase or acquire any such shares.

 

2.3                               Piggyback Registration Rights. The Borrower shall include on the next registration statement the Borrower files with U.S. Securities and Exchange Commission (and on each subsequent registration statement thereafter) all shares issuable upon exercise of the Warrant (as defined in the SPA), excluding for the avoidance of doubt, any one / next registration statement on Form S-1 filed by the Borrower in connection with an underwritten public offering. Failure to do so will result in liquidated damages of 25% of the outstanding principal balance of this Note, but not less than Fifteen Thousand and No/100 United States Dollars ($15,000), being immediately due and payable to the Holder at its election in the form of cash payment or addition to the balance of this Note.

 

ARTICLE III. EVENTS OF DEFAULT

 

The occurrence of each of the following events of default shall each be an “Event of Default”, with no right to notice or cue the right to cure except as specifically stated:

 

3.1                               Failure to Pay Principal or Interest.  The Borrower fails to pay the principal hereof or interest thereon when due on this Note, whether at the Maturity Date, upon acceleration, or otherwise.

 

3.2                               Conversion and the Shares.  The Borrower fails to reserve a sufficient amount of shares of common stock as required under the terms of this Note (including without limitation, Sections 1.2 and 1.3 of this Note), fails to issue shares of Common Stock to the Holder (or announces or threatens in writing that it will not honor its obligation to do so) upon exercise by the Holder of the conversion rights of the Holder in accordance with the terms of this Note, fails to transfer or cause its transfer agent to transfer (issue) (electronically or in certificated form) shares of Common Stock issued to the Holder upon conversion of or otherwise pursuant to this Note as and when required by this Note, the Borrower directs its transfer agent not to transfer or delays, impairs, and/or hinders its transfer agent in transferring (or issuing) (electronically or in certificated form) shares of Common Stock to be issued to the Holder upon conversion of or otherwise pursuant to this Note as and when required by this Note, or fails to remove (or directs its transfer agent not to remove or impairs, delays, and/or hinders its transfer agent from removing) any restrictive legend (or to withdraw any stop transfer instructions in respect thereof) on any shares of Common Stock issued to the Holder upon conversion of or otherwise pursuant to this Note as and when required by this Note (or makes any written announcement, statement or threat that it does not intend to honor the obligations described in this paragraph) and any such failure shall continue uncured (or any written announcement, statement or threat not to honor its obligations shall not be rescinded in writing) for two (2) business days after the Holder shall have delivered a Notice of Conversion.  It is an obligation of the Borrower to remain current in its obligations to its transfer agent.  It shall be an event of default of this Note, if a conversion of this Note is delayed, hindered or frustrated due to a balance owed by the Borrower to its transfer agent.  If at the option of the Holder, the Holder advances any funds to the Borrower’s transfer agent in order to process a conversion (excluding for the avoidance of doubt, the conversion price which is the Holder’s obligation to pay), such advanced funds shall be paid by the Borrower to the Holder within five (5) business days, either in cash or as an addition to the balance of this Note, and such choice of payment method is at the discretion of the Borrower.

 

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3.3                               Breach of Covenants.  The Borrower breaches any material covenant or other material term or condition contained in this Note, such breach would reasonably be expected to have (or with the passage of time will have) a material adverse effect on the rights of the Holder with respect to this Note, and such breach continues for a period of fifteen (15) days after written notice thereof to the Borrower from the Holder or after twenty-five (25) days after the Borrower should have been aware of the breach.

 

3.4                               Breach of Representations and Warranties.  Any representation or warranty of the Borrower made herein or in any agreement, statement or certificate given in writing pursuant hereto or in connection herewith, shall be false or misleading in any material respect when made and the breach of which has (or with the passage of time will have) a material adverse effect on the rights of the Holder with respect to this Note.

 

3.5                               Receiver or Trustee.  The Borrower shall make an assignment for the benefit of creditors, or apply for or consent to the appointment of a receiver or trustee for it or for a substantial part of its property or business, or such a receiver or trustee shall otherwise be appointed.

 

3.6                               Judgments.  Any money judgment, writ or similar process shall be entered or filed against the Borrower or any of its property or other assets for more than $100,000, and shall remain unvacated, unbonded or unstayed for a period of thirty (30) days unless otherwise consented to by the Holder, which consent will not be unreasonably withheld.

 

3.7                               Bankruptcy.  Bankruptcy, insolvency, reorganization or liquidation proceedings or other proceedings, voluntary or involuntary, for relief under any bankruptcy law or any law for the relief of debtors shall be instituted by or against the Borrower.

 

3.8                               Delisting of Common Stock.  The Borrower shall fail to maintain the listing or quotation of the Common Stock on the Trading Market or an equivalent replacement exchange, the Nasdaq Global Market, the Nasdaq Capital Market, the New York Stock Exchange, the NYSE American, or the OTCQB or OTCQX market places of the OTC Markets.

 

3.9                               Failure to Comply with the Exchange Act.  The Borrower shall fail to comply with the reporting requirements of the Exchange Act (including but not limited to becoming delinquent in its filings), and/or the Borrower shall cease to be subject to the reporting requirements of the Exchange Act.

 

3.10                        Liquidation.  The Borrower commences any dissolution, liquidation, or winding up of Borrower or any substantial portion of its business.

 

3.11                        Cessation of Operations.  The Borrower ceases operations or Borrower admits it is otherwise generally unable to pay its debts as such debts become due, provided, however, that any disclosure of the Borrower’s ability to continue as a “going concern” shall not be an admission that the Borrower cannot pay its debts as they become due.

 

3.12                        Financial Statement Restatement.  The Borrower replaces its auditor, or any restatement of any financial statements filed by the Borrower with the SEC for any date or period from two years prior to the Issue Date of this Note and until this Note is no longer outstanding, if the result of such restatement would, by comparison to the unrestated financial statements, have constituted a material adverse effect on the Borrower or the rights of the Holder with respect to this Note.

 

3.13                        Reverse Splits.  The Borrower effectuates a reverse split of its Common Stock without twenty (20) days prior written notice to the Holder.

 

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3.14                        Replacement of Transfer Agent.  In the event that the Borrower replaces its transfer agent, and the Borrower fails to provide prior to the effective date of such replacement, a fully executed Irrevocable Transfer Agent Instructions (including but not limited to the provision to irrevocably reserve shares of Common Stock in the Reserved Amount) signed by the successor transfer agent to Borrower and the Borrower that reserves the greater of the (i) total amount of shares previously held in reserve for this Note with the Borrower’s immediately preceding transfer agent and (ii) Reserved Amount

 

3.15                        Cross-Default.  Notwithstanding anything to the contrary contained in this Note or the other related or companion documents, a breach or default by the Borrower of any covenant or other term or condition contained in any of the other indebtedness having an outstanding principal amount in excess of $1,000,000 currently issued, or hereafter issued, by the Borrower, to the Holder or any 3rd party (the “Other Agreements”), shall, at the option of the Holder, be considered a default under this Note, in which event the Holder shall be entitled to apply all rights and remedies of the Holder under the terms of this Note by reason of a default under said Other Agreement or hereunder.

 

3.16                        Inside Information.  Any attempt by the Borrower or its officers, directors, and/or affiliates to transmit, convey, disclose, or any actual transmittal, conveyance, or disclosure by the Borrower or its officers, directors, and/or affiliates of, material non-public information concerning the Borrower, to the Holder or its successors and assigns, which is not promptly cured by Borrower’s filing of a Form 8-K pursuant to Regulation FD on that same date.

 

3.17                        No bid.  At any time while this Note is outstanding, the lowest Trading Price on the Trading Market or other applicable principal trading market for the Common Stock is equal to or less than $0.0001. “Trading Price” means, for any security as of any date, the lowest VWAP price on NASDAQ, or applicable trading market (the “Trading Market”) as reported by a reliable reporting service designated by the Holder (i.e., www.Nasdaq.com) or, if the Trading Market is not the principal trading market for such security, on the principal securities exchange or trading market where such security is listed or traded or, if the lowest intraday trading price of such security is not available in any of the foregoing manners, the lowest intraday price of any market makers for such security that are quoted on the OTC Markets. “Trading Day” shall mean any day on which the Common Stock is tradable for any  period on the Trading Market, or on the principal securities exchange or other securities market on which the Common Stock is then being traded.

 

3.18                        Prohibition on Debt and Variable Securities.  So long as this Note is outstanding, the Borrower shall not, without written consent of the Holder, issue any Variable Security (as defined herein), unless (i) the Borrower is permitted to pay off this Note in cash at the time of the issuance of the respective Variable Security and (ii) the Borrower pays off this Note, pursuant to the terms of this Note, in cash at the time of the issuance of the respective Variable Security.  A “Variable Security” shall mean any security issued by the Borrower, not subject to a floor price that is within fifty percent (50%) of the then current market price of the Common Stock, that (i) has or may have conversion rights of any kind, contingent, conditional or otherwise in which the number of shares that may be issued pursuant to such conversion right varies with the market price of the Common Stock; (ii) is or may become convertible into Common Stock (including without limitation convertible debt, warrants or convertible preferred stock), with a conversion or exercise price that varies with the market price of the common stock, even if such security only becomes convertible or exercisable following an event of default, the passage of time, or another trigger event or condition; or (iii) was issued or may be issued in the future in exchange for or in connection with any contract, security, or instrument, whether convertible or not, where the number of shares of Common Stock issued or to be issued is based upon or related in any way to the market price of the Common Stock, including, but not limited to, Common Stock issued in connection with a Section 3(a)(9) exchange, a Section 3(a)(10) settlement, or any other similar settlement or exchange. Notwithstanding the foregoing, the Company shall not be deemed to be in default under this subsection to the extent that it issuance securities in compliance with obligations under written transaction documents that existed, unaltered, prior to the Issue Date.

 

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3.19                        Failure to Repay Upon Qualified Offering.  The Borrower completes an offering and/or sale of securities, or becomes a borrower under any loan documents and/or credit facilities, on or after the Issue Date and fails to apply the proceeds of such offering, sale or loan to the repayment of this Note, until this Note is repaid in its entirety.

 

During the existence of any Event of Default specified in Sections 3.1, 3.2  3.3, 3.4, 3.5, 3.6, 3.7, 3.8, 3.9, 3.10, 3.11, 3.12, 3.13, 3.14, 3.15, 3.16, 3.17, 3.18, and/or this 3.19, this Note shall, at the option of Holder by written notice to Borrower thereof, become immediately due and payable and the Borrower shall pay to the Holder, in full satisfaction of its obligations hereunder, an amount equal to 135% (plus an additional 5% per each additional Event of Default that occurs hereunder) multiplied by the then outstanding entire balance of this Note (including principal and accrued and unpaid interest) plus Default Interest, if any, plus any amounts owed to the Holder pursuant to Sections 1.3(g) hereof (collectively, in the aggregate of all of the above, the “Default Amount”), and all other amounts payable hereunder shall immediately become due and payable, all without demand, presentment or notice, all of which hereby are expressly waived, together with all costs, including, without limitation, legal fees and expenses, of collection, and the Holder shall be entitled to exercise all other rights and remedies available at law or in equity.

 

If an Event of Default then exists, the Holder shall have the right at any time, to require the Borrower, to immediately issue, in lieu of the Default Amount, the number of shares of Common Stock of the Borrower equal to the Default Amount divided by the Conversion Price then in effect, subject to issuance in tranches due to the beneficial ownership limitations contained in this Note.

 

ARTICLE IV. MISCELLANEOUS

 

4.1                               Failure or Indulgence Not Waiver.  No failure or delay on the part of the Holder in the exercise of any power, right or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other or further exercise thereof or of any other right, power or privileges.  All rights and remedies existing hereunder are cumulative to, and not exclusive of, any rights or remedies otherwise available.

 

4.2                               Notices.  All notices, demands, requests, consents, approvals, and other communications required or permitted hereunder shall be in writing and, unless otherwise specified herein, shall be (i) personally served, (ii) deposited in the mail, registered or certified, return receipt requested, postage prepaid, (iii) delivered by reputable air courier service with charges prepaid, or (iv) transmitted by hand delivery, telegram, facsimile, or electronic mail addressed as set forth below or to such other address as such party shall have specified most recently by written notice.  Any notice or other communication required or permitted to be given hereunder shall be deemed effective (a) upon hand delivery, upon electronic mail delivery, or delivery by facsimile, with accurate confirmation generated by the transmitting facsimile machine, at the address or number designated below (if delivered on a business day during normal business hours where such notice is to be received), or the first business day following such delivery (if delivered other than on a business day during normal business hours where such notice is to be received) or (b) on the second business day following the date of mailing by express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first occur.  The addresses for such communications shall be:

 

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If to the Borrower, to:

 

JAGUAR HEALTH, INC.

201 Mission Street, Suite 2375

San Francisco, California

Attention: Lisa A. Conte, CEO

e-mail: lconte@jaguar.health

 

With a copy (which shall not constitute notice) to:

 

Reed Smith LLP

1510 Page Mill Road, Suite 110

Palo Alto, CA 94304

E-mail: DReinke@reedsmith.com

Attention: Donald Reinke, Esq.

Phone: 650.352.0532

 

If to the Holder:

 

L2 CAPITAL, LLC

208 Ponce de Leon Ave.

Ste. 1600

San Juan, PR 00918

e-mail: accounting@ltwocapital.com

 

with a copy to that shall not constitute notice:

 

K&L Gates LLP

200 S. Biscayne Blvd., Ste. 3900

Miami, FL 33131

Attention: John D. Owens, III, Esq.

e-mail: john.owens@klgates.com

 

4.3                               Amendments.  This Note and any provision hereof may only be amended by an instrument in writing signed by the Borrower and the Holder.  The term “Note” and all reference thereto, as used throughout this instrument, shall mean this instrument as originally executed, or if later amended or supplemented, then as so amended or supplemented.

 

4.4                               Assignability.  This Note shall be binding upon the Borrower and its successors and assigns, and shall inure to be the benefit of the Holder and its successors and assigns.  Notwithstanding anything to the contrary herein, the rights, interests or obligations of the Borrower hereunder may not be assigned, by operation of law or otherwise, in whole or in part, by the Borrower without the prior signed written consent of the Holder, which consent may be withheld at the sole discretion of the Holder (any such assignment or transfer shall be null and void if the Borrower does not obtain the prior signed written consent of the Holder).  This Note or any of the severable rights and obligations inuring to the benefit of or to be performed by Holder hereunder may be assigned by Holder to a third party, in whole or in part, without the need to obtain the Borrower’s consent thereto.  Each transferee of this Note must be an “accredited investor” (as defined in Rule 501(a) of the Securities Act).  Notwithstanding anything in this Note to the contrary, this Note may be pledged as collateral in connection with a bona fide margin account or other lending arrangement.

 

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4.5                               Cost of Collection.  If default is made in the payment of this Note, the Borrower shall pay the Holder hereof costs of collection, including reasonable attorneys’ fees.

 

4.6                               Governing Law.  This Note shall be governed by and interpreted in accordance with the laws of the State of Kansas without regard to the principles of conflicts of law (whether of the State of Kansas or any other jurisdiction).

 

4.7                               Arbitration.  Any disputes, claims, or controversies arising out of or relating to this Note, or the transactions, contemplated thereby, or the breach, termination, enforcement, interpretation or validity thereof, including the determination of the scope or applicability of this Note to arbitrate, shall be referred to and resolved solely and exclusively by binding arbitration to be conducted before the Judicial Arbitration and Mediation Service (“JAMS” ), or its successor pursuant the expedited procedures set forth in the JAMS Comprehensive Arbitration Rules and Procedures (the “Rules” ), including Rules 16.1 and 16.2 of those Rules.  The arbitration shall be held in New York, New York, before a tribunal consisting of three (3) arbitrators each of whom will be selected in accordance “strike and rank” methodology set forth in Rule 15.  Either party to this Note may, without waiving any remedy under this Note, seek from any court having jurisdiction any interim or provisional relief that is necessary to protect the rights or property of that party, pending the establishment of the arbitral tribunal.  The costs and expenses of such arbitration shall be allocated as determined by the arbitrators, and the arbitrators are authorized to award attorneys’ fees to the prevailing party, including pre- and post-award interest.  The arbitrators’ decision must set forth a reasoned basis for any award of damages or finding of liability.  The arbitrators’ decision and award will be made and delivered as soon as reasonably possible and in any case within sixty (60) days’ following the conclusion of the arbitration hearing and shall be final and binding on the parties and may be entered by any court having jurisdiction thereof.

 

4.8                               JURY TRIAL WAIVER.  THE BORROWER AND THE HOLDER HEREBY WAIVE A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY EITHER OF THE PARTIES HERETO AGAINST THE OTHER IN RESPECT OF ANY MATTER ARISING OUT OF OR IN CONNECTION WITH THIS NOTE.

 

4.9                               Certain Amounts.  Whenever pursuant to this Note the Borrower is required to pay an amount in excess of the outstanding Principal Amount (or the portion thereof required to be paid at that time) plus accrued and unpaid interest plus Default Interest on such interest, the Borrower and the Holder agree that the actual damages to the  Holder from the receipt of cash payment on this Note may be difficult to determine and the amount to be so paid by the Borrower represents stipulated damages and not a penalty and is intended to compensate the Holder in part for loss of the opportunity to convert this Note and to earn a return from the sale of shares of Common Stock acquired upon conversion of this Note at a price in excess of the price paid for such shares pursuant to this Note.  The Borrower and the Holder hereby agree that such amount of stipulated damages is not plainly disproportionate to the possible loss to the Holder from the receipt of a cash payment without the opportunity to convert this Note into shares of Common Stock.

 

4.10                        Remedies.  The Borrower acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Holder, by vitiating the intent and purpose of the transaction contemplated hereby.  Accordingly, the Borrower acknowledges that the remedy at law for a breach of its obligations under this Note will be inadequate and agrees, in the event of a breach or threatened breach by the Borrower of the provisions of this Note, that the Holder shall be entitled, in addition to all other available remedies at law or in equity, and in addition to the penalties assessable herein, to an injunction or injunctions restraining, preventing or curing any breach of this Note and to enforce specifically the terms and provisions thereof, without the necessity of showing economic loss and without any bond or other security being required.

 

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4.11                        Section 3(a)(10) Transactions.  If at any time while this Note is outstanding, the Borrower enters into a transaction structured in accordance with, based upon, or related or pursuant to, in whole or in part, Section 3(a)(10) of the Securities Act (a “3(a)(10) Transaction”), then a liquidated damages charge of 100% of the outstanding principal balance of this Note at that time, will be assessed and will become immediately due and payable to the Holder, either in the form of cash payment, an addition to the balance of this Note, or a combination of both forms of payment, as determined by the Holder. The liquidated damages charge in this Section 4.11 shall be in addition to, and not in substitution of, any of the other rights of the Holder under this Note.

 

4.12                        Restriction on Section 3(a)(9) Transactions.  So long as this Note is outstanding, the Borrower shall not enter into any 3(a)(9) Transaction with any party other than the Holder, without prior written consent of the Holder.  In the event that the Borrower does enter into, or makes any issuance of Common Stock related to a 3(a)(9) Transaction while this Note is outstanding, a liquidated damages charge of 25% of the outstanding principal balance of this Note, but not less than $15,000, will be assessed and will become immediately due and payable to the Holder at its election in the form of cash payment or addition to the balance of this Note.  “3(a)(9) Transaction” means a transaction structured in accordance with, based upon, or related or pursuant to, in whole or in part, Section 3(a)(9) of the Securities Act.  The liquidated damages charge in this Section 4.12 shall be in addition to, and not in substitution of, any of the other rights of the Holder under this Note.

 

4.13                        Usury.  If it shall be found that any interest or other amount deemed interest due hereunder violates the applicable law governing usury, the applicable rate of interest due hereunder shall automatically be lowered to equal the maximum rate of interest permitted under applicable law.  The Borrower covenants (to the extent that it may lawfully do so) that it shall not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law or other law which would prohibit or forgive the Borrower from paying all or any portion of the principal of or interest on this Note as contemplated herein, wherever enacted, now or at any time hereafter in force, or which may affect the covenants or the performance of this Note, and the Borrower (to the extent it may lawfully do so) hereby expressly waives all benefits or advantage of any such law, and covenants that it will not, by resort to any such law, hinder, delay or impede the execution of any power herein granted to the Holder, but will suffer and permit the execution of every such as though no such law has been enacted.

 

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4.14                        Repayment. Notwithstanding anything to the contrary contained in this Note, the Borrower may repay any amount outstanding under this Note, during the 30 calendar day period after the Issue Date, by making a payment to the Holder of an amount in cash equal to 102.5% multiplied by the amount that the Borrower is repaying. Notwithstanding anything to the contrary contained in this Note, the Borrower may repay any amount outstanding under this Note, during the 31st through 60th calendar day period after the Issue Date, by making a payment to the Holder of an amount in cash equal to 110% multiplied by the amount that the Borrower is repaying. Notwithstanding anything to the contrary contained in this Note, the Borrower may repay any amount outstanding under this Note, during the 61st through 90th calendar day period after the Issue Date, by making a payment to the Holder of an amount in cash equal to 112.5% multiplied by the amount that the Borrower is repaying. Notwithstanding anything to the contrary contained in this Note, the Borrower may repay any amount outstanding under this Note, during the 91st through 120th calendar day period after the Issue Date, by making a payment to the Holder of an amount in cash equal to 117.5% multiplied by the amount that the Borrower is repaying. Notwithstanding anything to the contrary contained in this Note, the Borrower may repay any amount outstanding under this Note, after the 120th calendar day after the Issue Date, including on and after the Maturity Date, by making a payment to the Holder of an amount in cash equal to 125% multiplied by the amount that the Borrower is repaying. In order to repay this Note, the Borrower shall provide notice to the Holder three (3) business days prior to such respective repayment date, and the Holder must receive such repayment within five (5) business days of the Holder’s receipt of the respective repayment notice, but not sooner than two (2) business days from the date of notice (the “Repayment Period”). The Holder may convert the Note in whole or in part at any time during the Repayment Period, subject to the terms and conditions of this Note.

 

** signature page to follow **

 

14

 

IN WITNESS WHEREOF, Borrower has caused this Note to be signed in its name by its duly authorized officer on the Issue Date.

 

JAGUAR HEALTH, INC.

 

 

	
By:
    	
/s/ Lisa   A. Conte
    	
 
    
	
Name: Lisa A. Conte
    	
 
    
	
Title: President and Chief   Executive Officer
    	
 
    

 

15

 

EXHIBIT A — NOTICE OF CONVERSION

 

The undersigned hereby elects to convert $                                    amount of this Note (defined below) into that number of shares of Common Stock to be issued pursuant to the conversion of this Note (“Common Stock”) as set forth below, of Jaguar Health, Inc., a Delaware corporation (the “Borrower”), according to the conditions of the convertible promissory note of the Borrower dated as of September 11, 2018 (the “Note”), as of the date written below.  No fee will be charged to the Holder for any conversion, except for transfer taxes, if any.

 

Box Checked as to applicable instructions:

 

o                                    The Borrower shall electronically transmit the Common Stock issuable pursuant to this Notice of Conversion to the account of the undersigned or its nominee with DTC through its Deposit Withdrawal Agent Commission system (“DWAC Transfer”).

 

Name of DTC Prime

Broker: Account Number:

 

o                                    The undersigned hereby requests that the Borrower issue a certificate or certificates for the number of shares of Common Stock set forth below (which numbers are based on the Holder’s calculation attached hereto) in the name(s) specified immediately below or, if additional space is necessary, on an attachment hereto:

 

L2 CAPITAL, LLC

208 Ponce de Leon Ave.

Ste. 1600

San Juan, PR 00918e-mail: accounting@ltwocapital.com

 

	
Date of Conversion:
    	
 
    	
                     
    	
 
    
	
Applicable Conversion Price:
    	
 
    	
$
    	
                   
    	
 
    
	
Number of Shares   of Common Stock to be Issued Pursuant to Conversion of this Notes:
    	
 
    	
                     
    	
 
    
	
Amount of   Principal Balance Due remaining Under this Note after this conversion:
    	
 
    	
                     
    	
 
    
					

 

L2 CAPITAL, LLC

 

	
By:
    	
 
    	
 
    
	
Name:
    	
 
    	
 
    
	
Title:
    	
 
    	
 
    
	
Date:
    	
 
    	
 
    

 

16

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