Document:

exv10w4

Exhibit 10.4

REGISTRATION RIGHTS AGREEMENT

     THIS REGISTRATION RIGHTS AGREEMENT (this “Agreement”) is made as of July 30, 2010, among GSC
Investment Corp., a Maryland corporation (the “Company”), GSC CDO III, L.L.C., a Delaware limited
liability company (“GSC CDO”), and each signatory hereto (together with GSC CDO, each, an
“Investor” and collectively, the “Investors”).

R E C I T A L S

     WHEREAS, the Company and the Investors other than GSC CDO are parties to that certain Stock
Purchase Agreement, dated April 14, 2010 (the “Stock Purchase Agreement”), entered into in
connection with a private placement offering (the “Offering”) of shares of the Company’s common
stock, par value $0.0001 per share (the “Common Stock”); and

     WHEREAS, the Company and GSC CDO are parties to a letter agreement, dated April 14, 2010 (the
“Letter Agreement”), pursuant to which GSC CDO has agreed to terminate its rights under that
Registration Rights Agreement, dated March 27, 2007, among the Company, GSC CDO and the other
investor parties thereto in connection with the Offering; and

     WHEREAS, this Agreement shall be subject to the terms and conditions of the Stock Purchase
Agreement, including without limitation the Transfer Restrictions set forth in Article 3 thereof;
and

     WHEREAS, the obligations of the Investors other than GSC CDO under the Stock Purchase
Agreement and of GCS CDO under the Letter Agreement are conditioned upon the Company’s entry into
this Agreement.

     NOW, THEREFORE, in consideration of the promises, covenants and conditions set forth herein,
the parties hereto hereby agree as follows:

     1. Registration Rights.

     1.1 Definitions. Capitalized terms used but not otherwise defined herein shall have
the meaning ascribed to such terms in the Stock Purchase Agreement. As used in this Agreement, the
following terms shall have the meanings set forth below:

     (a) “Commission” means the United States Securities and Exchange Commission.

     (b) “Effectiveness Date” means the date that is ninety (90) days after the Trigger
Date.

     (c) “Exchange Act” means the Securities Exchange Act of 1934, as amended.

     (d) “Filing Date” means the date that is thirty (30) days after the Trigger Date.

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     (e) “Investor” means any person owning Registrable Securities who becomes party to
this Agreement by executing a counterpart signature page hereto, or other agreement in writing to
be bound by the terms hereof.

     (f) The terms “register,” “registered” and “registration” refer to a
registration effected by preparing and filing a Registration Statement or similar document in
compliance with the Securities Act, and the declaration or ordering of effectiveness of such
Registration Statement or document.

     (g) “Registration Statement” means any registration statement required to be filed in
accordance with this Agreement to register the Registrable Securities including amendments and
supplements to such registration statement, all exhibits thereto, the Prospectus included therein
and all material incorporated by reference or deemed to be incorporated by reference therein.

     (h) “Registrable Securities” means (i) the Shares and (ii) any securities issued or
issuable upon any stock split, dividend or other distribution, recapitalization or similar event
relating to the Shares; provided, however, that Registrable Securities shall not include
any securities of the Company that have previously been registered and remain subject to a
currently effective Registration Statement or which have been sold to the public either pursuant to
a Registration Statement or Rule 144, or which may be sold immediately without registration under
the Securities Act and without volume restrictions pursuant to Rule 144.

     (i) “Rule 144” means Rule 144 as promulgated by the Commission under the Securities
Act, as such Rule may be amended from time to time, or any similar successor rule that may be
promulgated by the Commission.

     (j) “Rule 415” means Rule 415 as promulgated by the Commission under the Securities
Act, as such Rule may be amended from time to time, or any similar successor rule that may be
promulgated by the Commission.

     (k) “Securities Act” means the Securities Act of 1933, as amended.

     (l) “Shares” means the shares of Common Stock issued pursuant to the Stock Purchase
Agreement and the shares of Common Stock held by GSC CDO as of the date of this Agreement.

     (m) “Trigger Date” means the date of the Closing (as such term is defined in the Stock
Purchase Agreement).

     1.2 Company Registration.

     (a) On or prior to the Filing Date, the Company shall prepare and file with the Commission a
Registration Statement covering the Registrable Securities for an offering to be made on a
continuous basis pursuant to Rule 415 (the “Mandatory Registration Statement”). The Mandatory
Registration Statement shall be on Form N-2. The Company shall cause the Mandatory Registration
Statement to become effective and remain effective as provided herein.

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The Company shall use commercially reasonable efforts to cause the Mandatory Registration Statement
to be declared effective under the Securities Act as soon as possible and, in any event, by no
later than the Effectiveness Date. The Company shall use commercially reasonable efforts to keep
the Mandatory Registration Statement continuously effective under the Securities Act until all
Registrable Securities covered by such Mandatory Registration Statement have been sold, or may be
sold without the requirement to be in compliance with Rule 144(c)(1) and otherwise without
restriction or limitation pursuant to Rule 144 (the “Effectiveness Period”).

     (b) The Company shall bear and pay all reasonable expenses incurred in connection with any
registration, filing or qualification of Registrable Securities with respect to the registration
pursuant to this Section 1.2 for each Investor, including (without limitation) all registration,
filing and qualification fees, printer’s fees, accounting fees, the filing fees incident to, and
the reasonable fees and disbursements of counsel for underwriters in connection with, any required
review by the Financial Industry Regulatory Authority, Inc. (“FINRA”) of the terms of the sale of
the Registrable Securities and fees and disbursements of counsel for the Company, but excluding any
brokerage or underwriting fees, discounts and commissions relating to the Registrable Securities,
or fees and disbursements of counsel for the Investors; such excluded expenses shall be borne by
the Investors.

     (c) If at any time during the Effectiveness Period there is not an effective Mandatory
Registration Statement covering all of the Registrable Securities, then the Company shall notify
each Investor in writing at least ten (10) days prior to the filing of any registration statement
under the Securities Act, in connection with a public offering of shares of Common Stock
(including, but not limited to, registration statements relating to secondary offerings of
securities of the Company but excluding any registration statements (i) on Form N-14 (or any
successor or substantially similar form), (ii) otherwise relating to any corporate reorganization
or other transactions covered by Rule 145 promulgated under the Securities Act, or (iii) on any
registration form which does not permit secondary sales or does not include substantially the same
information as would be required to be included in a registration statement covering the resale of
the Registrable Securities) and will afford each Investor an opportunity to include in such
registration statement (each a “Piggyback Registration Statement”) all or part of the Registrable
Securities held by such Investor. In the event an Investor desires to include in any such
Piggyback Registration Statement all or any part of the Registrable Securities held by such
Investor, the Investor shall within five (5) days after the delivery of the above-described notice
from the Company, so notify the Company in writing, including the number of such Registrable
Securities such Investor wishes to include in such Piggyback Registration Statement. If an Investor
decides not to include all of its Registrable Securities in any Registration Statement thereafter
filed by the Company such Investor shall nevertheless continue to have the right to include any
Registrable Securities in any subsequent Registration Statement or Registration Statements as may
be filed by the Company with respect to the offering of the securities, all upon the terms and
conditions set forth herein.

     (d) The right of any such Investor’s Registrable Securities to be included in any Piggyback
Registration Statement pursuant to Section 1(c) above in connection with an underwritten offering,
shall be conditioned upon such Investor’s participation in such

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underwritten offering and the inclusion of such Investor’s Registrable Securities in the
underwritten offering to the extent provided herein. All Investors proposing to distribute their
Registrable Securities through such underwritten offering shall enter into an underwriting
agreement in customary form with the managing underwriters selected by the Company for such
underwriting and complete and execute any questionnaires, powers of attorney, indemnities,
securities escrow agreements, custody agreements, lock-up agreements, and other documents
reasonably required under the terms of such underwriting, and furnish to the Company such
information in writing as the Company may reasonably request for inclusion in the Piggyback
Registration Statement. Notwithstanding any other provision of this Agreement, if at any time in
connection with an underwritten offering, the managing underwriters determine in good faith that
marketing factors require a limitation on the number of shares to be included in a Piggyback
Registration Statement pursuant to Section 1(c) above, then the managing underwriters may exclude
shares (including Registrable Securities) from the Piggyback Registration Statement and the
underwritten offering, and any Shares included in the Piggyback Registration Statement and the
underwritten offering shall be allocated, first, to the Company, and second, to each of the
Investors requesting inclusion of their Registrable Securities in such Piggyback Registration
Statement on a pro rata basis based on the total number of Registrable Securities then held by each
such Investor that is requesting inclusion. If any Investor disapproves of the terms of any such
underwritten offering that is undertaken in compliance with the terms hereof, such Investor may
elect to withdraw therefrom by providing written notice to the Company and the underwriter,
delivered at least ten trading days prior to the effective date of the Piggyback Registration
Statement. Any Registrable Securities excluded or withdrawn from such underwritten offering shall
be excluded and withdrawn from the Piggyback Registration Statement. By electing to include
Registrable Securities in the Piggyback Registration Statement, if any, the Investor shall be
deemed to have agreed not to effect any sale or distribution of securities of the Company of the
same or similar class or classes of the securities included in the Registration Statement or any
securities convertible into or exchangeable or exercisable for such securities, including a sale
pursuant to Rule 144 under the Securities Act, during such periods as reasonably requested by the
managing underwriter.

     (e) Each Investor agrees to deliver a Notice and Questionnaire in the form attached hereto
as Exhibit A (the “Notice and Questionnaire”) to the Company at least seven (7) days prior
to any distribution by it of Registrable Securities under the Registration Statement. From and
after the date the Registration Statement is declared effective, the Company shall, as promptly as
is practicable after the date a Notice and Questionnaire is delivered, and in any event within the
later of seven (7) days after such date, or seven (7) days after the expiration of any suspension
event under Section 1.2(f) herein in effect when the Notice and Questionnaire is delivered or which
comes into effect within seven (7) days of such delivery: (i) if required by applicable law, file
with the Commission a post-effective amendment to the Registration Statement or prepare and, if
required by applicable law, file a supplement to the related Prospectus or file any other required
document so that each Investor is named as a selling holder in the Registration Statement and the
related Prospectus and so that each Investor is permitted to deliver such Prospectus to purchasers
of the Registrable Securities in accordance with applicable law and, if the Company shall file a
post-effective amendment to the Registration Statement, use commercially reasonable efforts to
cause such post-effective amendment to be declared effective

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under the Securities Act as promptly as is practicable and (ii) notify the Investor as promptly as
practicable after the effectiveness under the Securities Act of any post-effective amendment filed
pursuant to this Section 1.2(e); provided that if such Notice and Questionnaire is
delivered during a period of time when a suspension event under Section 1.2(f) of this Agreement
has occurred and is continuing, the Company shall so inform each Investor and shall take the
actions set forth in clauses (i) and (ii) above upon expiration of the suspension event in
accordance with Section 1.2(f).

     (f) Upon receipt of written notice from the Company that the Registration Statement (whether
Mandatory, Piggyback or otherwise) or a prospectus relating thereto contains an untrue statement of
a material fact or omits to state a material fact required to be stated therein or necessary to
make the statements therein not misleading (a “Misstatement”), each Investor shall forthwith
discontinue disposition of Registrable Securities until such Investor has received copies of the
supplemented or amended prospectus that corrects such Misstatement, or until such Investor is
advised in writing by the Company that the use of the Prospectus may be resumed, and, if so
directed by the Company, such Investor shall deliver to the Company all copies, other than
permanent file copies then in such Investor’s possession, of the Prospectus covering such
Registrable Securities current at the time of receipt of such notice. The Company shall use its
commercially reasonable efforts to prepare and file, if necessary pursuant to applicable law, a
post-effective amendment to such Registration Statement or a supplement to the related Prospectus
so that such Registration Statement and related Prospectus do not contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein or necessary to make
the statements therein not misleading, and, in the case of a post-effective amendment to such
Registration Statement, use its commercially reasonable efforts to cause it to be declared
effective as soon as possible. The total number of days that any such suspension may be in effect
in any three hundred-sixty-five (365) day period shall not exceed ninety (90) days.

     1.3 Obligations of the Company. Whenever required under this Section 1 to effect the
registration of any Registrable Securities, the Company shall, as expeditiously as reasonably
possible:

     (a) Prepare and file with the Commission a Registration Statement with respect to such
Registrable Securities and use commercially reasonable efforts to cause such Registration Statement
to become effective and, in the case of the Mandatory Registration Statement, to keep such
Registration Statement effective during the Effectiveness Period;

     (b) Prepare and file with the Commission such amendments and supplements to such Registration
Statement as may be necessary to comply with the provisions of the Securities Act with respect to
the disposition of all securities covered by such Registration Statement;

     (c) Furnish to the Investors such numbers of copies of the prospectus that is part of such
Registration Statement (the “Prospectus”), including any preliminary Prospectus, in conformity with
the requirements of the Securities Act, and such other documents as they may reasonably request in
order to facilitate the disposition of Registrable Securities owned by them;

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     (d) Use commercially reasonable efforts to register and qualify the securities covered by such
Registration Statement under such other securities’ or blue sky laws of such jurisdictions as shall
be reasonably requested by the Investors; provided that the Company shall not be required
in connection therewith or as a condition thereto to qualify to do business or to file a general
consent to service of process in any such states or jurisdictions;

     (e) In the event of any underwritten public offering, enter into and perform its obligations
under an underwriting agreement, in usual and customary form, with the managing underwriter(s) of
such offering (each Investor participating in such underwriting shall also enter into and perform
its obligations under such an agreement);

     (f) Promptly notify each Investor holding Registrable Securities covered by such Registration
Statement at any time when a Prospectus relating thereto is required to be delivered under the
Securities Act, within one business day, (i) of the effectiveness of such Registration Statement,
or (ii) of the happening of any event as a result of which the Prospectus included in such
Registration Statement, as then in effect, includes a Misstatement;

     (g) Cause all such Registrable Securities registered pursuant hereto to be listed on each
securities exchange or nationally recognized quotation system on which similar securities issued by
the Company are then listed; and

     (h) Use commercially reasonable efforts to obtain any required “no-objection” letter or
similar clearance from FINRA of the terms of the sale of the Registrable Securities.

     1.4 Furnish Information. It shall be a condition precedent to the Company’s
obligations to take any action pursuant to this Section 1 with respect to the Registrable
Securities of any selling Investor, that such Investor shall furnish to the Company the Notice and
Questionnaire and such additional information regarding such Investor, the Registrable Securities
held by such Investor, and the intended method of disposition of such securities, as reasonably
required by the Company or the managing underwriters, if any, to effect the registration of such
Investor’s Registrable Securities.

     1.5 Delay of Registration. No Investor shall have any right to obtain or seek an
injunction restraining or otherwise delaying any such registration as the result of any controversy
that might arise with respect to the interpretation or implementation of this Section 1.

     1.6 Indemnification.

     (a) To the extent permitted by law, the Company will indemnify and hold harmless each
Investor, any underwriter (as defined in the Securities Act) for such Investor and each person, if
any, who controls such Investor or underwriter within the meaning of the Securities Act or the
Exchange Act, against any losses, claims, damages or liabilities (joint or several) to which any of
the foregoing persons may become subject under the Securities Act, the Exchange Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of
or are based upon any of the following statements, omissions or violations

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(collectively, a “Violation”): (i) any untrue statement or alleged untrue statement of a material
fact contained in a Registration Statement, including any preliminary Prospectus or final
Prospectus contained therein or any amendments or supplements thereto (collectively, the
“Filings”), (ii) the omission or alleged omission to state in the Filings a material fact required
to be stated therein, or necessary to make the statements therein not misleading, or (iii) any
violation or alleged violation by the Company of the Securities Act, the Exchange Act or any other
laws; and the Company will pay any legal or other expenses reasonably incurred by any person to be
indemnified pursuant to this Section 1.6(a) in connection with investigating or defending any such
loss, claim, damage, liability or action; provided, however, that the indemnity agreement
contained in this Section 1.6(a) shall not apply to amounts paid in settlement of any such loss,
claim, damage, liability or action if such settlement is effected without the consent of the
Company (which consent shall not be unreasonably withheld), nor shall the Company be liable in any
such case for any such loss, claim, damage, liability or action to the extent that it arises out of
or is based upon a Violation that occurs in reliance upon and in conformity with written
information furnished expressly for use in connection with such registration by any such Investor,
underwriter or controlling person or any failure of such person to deliver or cause to be delivered
a Prospectus made available by the Company in a timely manner.

     (b) To the extent permitted by law, each Investor will indemnify and hold harmless the
Company, each of its directors, each of its officers who has signed the Registration Statement,
each person, if any, who controls the Company within the meaning of the Securities Act or the
Exchange Act, any underwriter, any other Investor selling securities in such Registration Statement
and any controlling person of any such underwriter or other Investor, against any losses, claims,
damages or liabilities (joint or several) to which any of the foregoing persons may become subject
under the Securities Act, the Exchange Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereto) arise out of or are based upon any Violation, in each
case to the extent (and only to the extent) that such Violation occurs in reliance upon and in
conformity with written information furnished by such Investor expressly for use in connection with
such registration; and each such Investor will pay any legal or other expenses reasonably incurred
by any person to be indemnified pursuant to this Section 1.6(b) in connection with investigating or
defending any such loss, claim, damage, liability or action; provided, however, that the
indemnity agreement contained in this Section 1.6(b) shall not apply to amounts paid in settlement
of any such loss, claim, damage, liability or action if such settlement is effected without the
consent of the Investor (which consent shall not be unreasonably withheld); provided,
however, in no event shall any indemnity under this subsection 1.6(b) exceed the net proceeds
received by such Investor upon the sale of the Registrable Securities giving rise to such
indemnification obligation.

     (c) Promptly after receipt by an indemnified party under this Section 1.6 of notice of the
commencement of any action (including any governmental action), such indemnified party will, if a
claim in respect thereof is to be made against any indemnifying party under this Section 1.6,
deliver to the indemnifying party a written notice of the commencement thereof and the indemnifying
party shall have the right to participate in, and, to the extent the indemnifying party so desires,
jointly with any other indemnifying party similarly noticed, to assume the defense

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thereof with counsel mutually satisfactory to the parties; provided, however, that an
indemnified party (together with all other indemnified parties that may be represented without
conflict by one counsel) shall have the right to retain one separate counsel, with the fees and
expenses to be paid by the indemnifying party, if representation of such indemnified party by the
counsel retained by the indemnifying party would be inappropriate due to actual or potential
differing interests between such indemnified party and any other party represented by such counsel
in such proceeding. The indemnified party shall cooperate fully with the indemnifying party in
connection with any negotiation or defense of any such action or claim by the indemnifying party
and shall furnish to the indemnifying party all information reasonably available to the indemnified
party which relates to such action or claim. The indemnifying party shall keep the indemnified
party reasonably apprised of the status of the defense or any settlement negotiations with respect
thereto. The failure to deliver written notice to the indemnifying party within a reasonable time
of the commencement of any such action, if materially prejudicial to its ability to defend such
action, shall relieve such indemnifying party of any liability to the indemnified party under this
Section 1.6, but the omission so to deliver written notice to the indemnifying party will not
relieve it of any liability that it may have to any indemnified party otherwise than under this
Section 1.6.

     (d) If the indemnification provided for in Sections 1.6(a) and (b) is held by a court of
competent jurisdiction to be unavailable to an indemnified party with respect to any loss, claim,
damage or expense referred to herein, then the indemnifying party, in lieu of indemnifying such
indemnified party hereunder, shall contribute to the amount paid or payable by such indemnified
party as a result of such loss, claim, damage or expense in such proportion as is appropriate to
reflect the relative fault of the indemnifying party on the one hand and of the indemnified party
on the other in connection with the statements or omissions or alleged statements or omissions that
resulted in such loss, liability, claim or expense as well as any other relevant equitable
considerations. The relative fault of the indemnifying party and of the indemnified party shall be
determined by reference to, among other things, whether the untrue or alleged untrue statement of a
material fact relates to information supplied by the indemnifying party or by the indemnified party
and the parties’ relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. In no event shall any Investor be required to contribute an
amount in excess of the net proceeds received by such Investor upon the sale of the Registrable
Securities giving rise to such indemnification obligation. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act) will be entitled to
contribution hereunder from any person who was not guilty of such fraudulent misrepresentation.

     (e) The obligations of the Company and Investors under this Section 1.6 shall survive the
completion of any offering of Registrable Securities in a Registration Statement under this Section
1, and otherwise.

     1.7 Reports Under Exchange Act. With a view to making available the benefits of
certain rules and regulations of the Commission, including Rule 144, that may at any time permit an
Investor to sell securities of the Company to the public without registration or pursuant to a
registration on Form N-2, the Company agrees to use its commercially reasonable efforts to:

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     (a) make and keep public information available, as those terms are understood and defined in
Rule 144, in order to facilitate the resale of Registrable Securities by the Investors in
accordance with Rule 144;

     (b) file with the Commission in a timely manner all reports and other documents required of
the Company under the Exchange Act; and

     (c) furnish to any Investor, so long as the Investor owns any Registrable Securities,
forthwith upon request (i) a written statement by the Company that it has complied with the
reporting requirements of Rule 144 and the Exchange Act, (ii) a copy of the most recent annual or
quarterly report of the Company and such other reports and documents so filed by the Company, and
(iii) such other information as may be reasonably requested in availing any Investor of any rule or
regulation of the Commission that permits the selling of any such securities without registration
or pursuant to such form.

     1.8 Transfer or Assignment of Registration Rights. The rights to cause the Company to
register Registrable Securities pursuant to this Section 1 may be transferred or assigned, but only
with all related obligations (including without limitation the Transfer Restrictions set forth in
Article 3 of the Stock Purchase Agreement and the paragraph numbered 4 of the Letter Agreement), by
an Investor to a transferee or assignee (and in the case of Registrable Securities subject to the
Transfer Restrictions set forth in the Stock Purchase Agreement and the Letter Agreement, a
Permitted Transferee) of such Investor’s Registrable Securities; provided, that, (a) prior
to such transfer or assignment, the Company is furnished with written notice stating the name and
address of such transferee or assignee and identifying the securities with respect to which such
registration rights are being transferred or assigned, (b) such transferee or assignee agrees in
writing to be bound by and subject to the terms and conditions of this Agreement and, where
applicable, the Stock Purchase Agreement and the Letter Agreement, and (c) such transfer or
assignment shall be effective only if immediately following such transfer or assignment the further
disposition of such securities by the transferee or assignee is restricted under the Securities
Act.

     2. Miscellaneous.

     2.1 Governing Law. The parties hereby agree that any dispute which may arise between
them arising out of or in connection with this Agreement shall be adjudicated only before a federal
court located in the State of New York and they hereby submit to the exclusive jurisdiction of the
federal and state courts of the State of New York with respect to any action or legal proceeding
commenced by any party, and irrevocably waive any objection they now or hereafter may have
respecting the venue of any such action or proceeding brought in such a court or respecting the
fact that such court is an inconvenient forum, relating to or arising out of this Agreement or any
acts or omissions relating to the registration of the securities hereunder, and consent to the
service of process in any such action or legal proceeding by means of registered or certified mail,
return receipt requested, in care of the address set forth below or such other address as the
undersigned shall furnish in writing to the other.

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     2.2 WAIVER OF JURY TRIAL. EACH PARTY HERETO EXPRESSLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF
ACTION ARISING IN CONNECTION WITH THIS AGREEMENT OR ANY TRANSACTION RELATING HERETO OR THERETO.

     2.3 Waivers and Amendments. This Agreement may be terminated and any term of this
Agreement may be amended or waived (either generally or in a particular instance and either
retroactively or prospectively) with the written consent of the Company and Investors holding at
least a majority of the Registrable Securities then outstanding (the “Majority Investors”).
Notwithstanding the foregoing, additional parties may be added as Investors under this Agreement,
and the definition of Registrable Securities expanded, with the written consent of the Company and
the Majority Investors. No such amendment or waiver shall reduce the aforesaid percentage of the
Registrable Securities, the holders of which are required to consent to any termination, amendment
or waiver without the consent of the record holders of all of the Registrable Securities. Any
termination, amendment or waiver effected in accordance with this Section 2.3 shall be binding upon
each holder of Registrable Securities then outstanding, each future holder of all such Registrable
Securities and the Company.

     2.4 Successors and Assigns. Except as otherwise expressly provided for herein, the
provisions of this Agreement shall inure to the benefit of, and be binding upon, the successors,
assigns, heirs, executors and administrators of the parties hereto.

     2.5 Entire Agreement. This Agreement constitutes the full and entire understanding
and agreement among the parties with regard to the subject matter hereof, and no party shall be
liable or bound to any other party in any manner by any warranties, representations or covenants
except as specifically set forth herein.

     2.6 Notices. All notices and other communications or deliveries required or permitted
to be provided hereunder shall be in writing and shall be deemed given and effective on the
earliest of (a) the date of transmission, if such notice or communication is delivered via
facsimile at the facsimile number specified in this Section prior to 5:30 p.m. (Eastern Time) on a
business day, (b) the next business day after the date of transmission, if such notice or
communication is delivered via facsimile at the facsimile number specified in this Section on a day
that is not a business day or later than 5:30 p.m. (Eastern Time) on any date and earlier than
11:59 p.m. (Eastern Time) on such date, (c) the business day following the date of mailing, if sent
by U.S. nationally recognized overnight courier service, or (d) upon actual receipt by the party to
whom such notice is required to be given.

The address for such notices and communications shall be as follows:

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If to the Company:

GSC Investment Corp.

500 Campus Drive, Suite 220

Florham Park, NJ 07932

Attention: Seth M. Katzenstein, President & CEO

Facsimile No.: (973) 937-1025

If to GSC CDO:

GSC CDO III, L.L.C.

300 Campus Drive, Suite 110

Florham Park, NJ 07932

Attention: Seth M. Katzenstein

Facsimile No.: (973) 937-1025

If to the Investors, to the address set forth on such Investor’s signature page to the Stock
Purchase Agreement or such other address as may be designated in writing hereafter, in the
same manner, by the Investors.

     2.7 Interpretation. The words “include,” “includes” and “including” when used herein
shall be deemed in each case to be followed by the words “without limitation.” The titles and
subtitles used in this Agreement are used for convenience only and are not considered in construing
or interpreting this Agreement.

     2.8 Severability. If one or more provisions of this Agreement are held to be
unenforceable under applicable law, such provision shall be excluded from this Agreement, and the
balance of the Agreement shall be interpreted as if such provision were so excluded, and shall be
enforceable in accordance with its terms.

     2.9 Independent Nature of Investors’ Obligations and Rights. The obligations of each
Investor hereunder are several and not joint with the obligations of any other Investor hereunder,
and no Investor shall be responsible in any way for the performance of the obligations of any other
Investor hereunder. Nothing contained herein or in any other agreement or document delivered at
any closing, and no action taken by any Investor pursuant hereto or thereto, shall be deemed to
constitute the Investors as a partnership, an association, a joint venture or any other kind of
entity, or create a presumption that the Investors are in any way acting in concert with respect to
such obligations or the transactions contemplated by this Agreement. Each Investor shall be
entitled to protect and enforce its rights, including without limitation the rights arising out of
this Agreement, and it shall not be necessary for any other Investor to be joined as an additional
party in any proceeding for such purpose.

     2.10 Counterparts. This Agreement may be executed in any number of counterparts, each
of which shall be an original, but all of which together shall constitute one instrument. A
facsimile, email or other reproduction of this Agreement may be executed by one or more parties

11

 

hereto, and an executed copy of this Agreement may be delivered by one or more parties hereto by
facsimile, email or similar electronic transmission device pursuant to which the signature of or on
behalf of such party can be seen, and such execution and delivery shall be considered valid,
binding and effective for all purposes. At the request of any party hereto, all parties hereto
agree to execute an original of this Agreement as well as any facsimile, email or other
reproduction hereof.

[Remainder of page intentionally left blank; signature page follows.]

12

 

IN WITNESS WHEREOF, the Company and each of the Investors have caused this Agreement to be
executed as of the date set forth above.

	 	 	 	 	 
	 	GSC INVESTMENT CORP.

 	 
	 	By:  	/s/ Seth M. Katzenstein
 	 
	 	 	Name:  	Seth M. Katzenstein 	 
	 	 	Title:  	President and Chief Executive
Officer 	 
	 

	 	 	 	 	 
	 	GSC CDO III L.L.C.

By: GSCP (NJ) Holdings, L.P., as its Sole Member

By: GSCP (NJ), Inc., as its General Partner

 	 
	 	By:  	/s/ Seth M. Katzenstein
 	 
	 	 	Name:  	Seth M. Katzenstein 	 
	 	 	Title:  	Senior Managing Director 	 
	 

	 	 	 	 	 
	 	SARATOGA INVESTMENT ADVISORS, LLC

 	 
	 	By:  	/s/ Richard A. Petrocelli
 	 
	 	 	Name:  	Richard A. Petrocelli 	 
	 	 	Title:  	Managing Director 	 
	 

	 	 	 	 	 
	 	CLO PARTNERS LLC

 	 
	 	By:  	/s/  Christian L. Oberbeck
 	 
	 	 	Name:  	Christian L. Oberbeck 	 
	 	 	Title:  	Managing Member 	 
	 

[Signature Page to Registration Rights Agreement]exv10w5

EXHIBIT 10.5

 

CREDIT, SECURITY AND MANAGEMENT AGREEMENT

Dated as of July 30, 2010

among

GSC INVESTMENT FUNDING LLC

as the Borrower

GSC INVESTMENT CORP.

as the Performance Guarantor

SARATOGA INVESTMENT ADVISORS, LLC

as the Manager

THE FINANCIAL INSTITUTIONS FROM TIME TO TIME PARTY HERETO

as Lenders

MADISON CAPITAL FUNDING LLC

as the Administrative Agent

and

U.S. BANK NATIONAL ASSOCIATION

as Custodian

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page	 
	ARTICLE I DEFINITIONS
	 	 	1	 
	Section 1.1 Certain Defined Terms
	 	 	1	 
	Section 1.2 Other Terms
	 	 	33	 
	Section 1.3 Computation of Time Periods
	 	 	33	 
	Section 1.4 Interpretation
	 	 	33	 
	 
	 	 	 	 
	ARTICLE II ADVANCES
	 	 	34	 
	Section 2.1 Advances
	 	 	34	 
	Section 2.2 Procedures for Advances
	 	 	34	 
	Section 2.3 Optional Changes in Facility Amount; Prepayments
	 	 	36	 
	Section 2.4 Principal Repayments
	 	 	37	 
	Section 2.5 The Notes
	 	 	38	 
	Section 2.6 Interest Payments
	 	 	38	 
	Section 2.7 Settlement Procedures
	 	 	39	 
	Section 2.8 Collections and Allocations
	 	 	43	 
	Section 2.9 Payments, Computations, Etc
	 	 	44	 
	Section 2.10 Breakage Costs
	 	 	44	 
	Section 2.11 Increased Costs; Capital Adequacy; Illegality
	 	 	45	 
	Section 2.12 Taxes
	 	 	45	 
	Section 2.13 Fees
	 	 	47	 
	Section 2.14 Discretionary Sales of Loan Assets
	 	 	47	 
	 
	 	 	 	 
	ARTICLE III CONDITIONS OF EFFECTIVENESS AND ADVANCES
	 	 	48	 
	Section 3.1 Conditions to Effectiveness and Advances
	 	 	48	 
	Section 3.2 Additional Conditions Precedent to All Advances
	 	 	49	 
	Section 3.3 Conditions to Acquisitions and Pledges of Collateral
	 	 	49	 
	 
	 	 	 	 
	ARTICLE IV REPRESENTATIONS AND WARRANTIES
	 	 	50	 
	Section 4.1 Representations and Warranties of the Borrower
	 	 	50	 
	Section 4.2 Representations and Warranties of the Performance Guarantor
	 	 	56	 
	 
	 	 	 	 
	ARTICLE V GENERAL COVENANTS OF THE BORROWER
	 	 	57	 
	Section 5.1 Covenants of the Borrower
	 	 	57	 
	Section 5.2 Hedging Agreement
	 	 	61	 
	Section 5.3 Accounts
	 	 	62	 
	Section 5.4 Delivery of Loan Asset Files
	 	 	64	 
	 
	 	 	 	 
	ARTICLE VI SECURITY INTEREST
	 	 	64	 
	Section 6.1 Security Interest
	 	 	64	 
	Section 6.2 Remedies
	 	 	65	 
	Section 6.3 Release of Liens
	 	 	65	 
	Section 6.4 Assignment of the Purchase Agreement and CLO Management Contribution Agreement
	 	 	66	 
	 
	 	 	 	 
	ARTICLE VII ADMINISTRATION, SERVICING AND MANAGEMENT OF LOAN ASSETS
	 	 	67	 

i

 

	 	 	 	 	 
	 	 	Page	 
	Section 7.1 Appointment of the Manager
	 	 	67	 
	Section 7.2 Duties and Responsibilities of the Manager
	 	 	67	 
	Section 7.3 Authorization of the Manager
	 	 	69	 
	Section 7.4 Collection of Payments
	 	 	70	 
	Section 7.5 Representations and Warranties of the Manager
	 	 	70	 
	Section 7.6 Covenants of the Manager
	 	 	71	 
	Section 7.7 Payment of Certain Expenses by Manager
	 	 	73	 
	Section 7.8 Reports
	 	 	73	 
	Section 7.9 The Manager Not to Resign
	 	 	73	 
	Section 7.10 Reporting; Access to Certain Documentation and Information Regarding the Loan Assets
	 	 	73	 
	Section 7.11 [Reserved]
	 	 	76	 
	Section 7.12 [Reserved]
	 	 	76	 
	Section 7.13 The Custodian
	 	 	76	 
	Section 7.14 Representations and Warranties of the Custodian
	 	 	81	 
	Section 7.15 Covenants of the Custodian
	 	 	82	 
	 
	 	 	 	 
	ARTICLE VIII EVENTS OF DEFAULT
	 	 	83	 
	Section 8.1 Events of Default
	 	 	83	 
	Section 8.2 Remedies
	 	 	84	 
	 
	 	 	 	 
	ARTICLE IX INDEMNIFICATION
	 	 	86	 
	Section 9.1 Indemnities by the Borrower
	 	 	86	 
	Section 9.2 Indemnities by the Manager
	 	 	88	 
	 
	 	 	 	 
	ARTICLE X THE ADMINISTRATIVE AGENT
	 	 	89	 
	Section 10.1 Authorization and Action
	 	 	89	 
	Section 10.2 Delegation of Duties
	 	 	89	 
	Section 10.3 Exculpatory Provisions
	 	 	90	 
	Section 10.4 Reliance
	 	 	90	 
	Section 10.5 Non-Reliance on Administrative Agent and Other Lenders
	 	 	90	 
	Section 10.6 Reimbursement and Indemnification
	 	 	91	 
	Section 10.7 Administrative Agent in its Individual Capacities
	 	 	91	 
	Section 10.8 Successor Administrative Agent
	 	 	91	 
	 
	 	 	 	 
	ARTICLE XI ASSIGNMENTS; PARTICIPATIONS
	 	 	91	 
	Section 11.1 Assignments and Participations
	 	 	91	 
	 
	 	 	 	 
	ARTICLE XII MISCELLANEOUS
	 	 	93	 
	Section 12.1 Amendments and Waivers
	 	 	93	 
	Section 12.2 Notices, Etc
	 	 	94	 
	Section 12.3 No Waiver, Rights and Remedies
	 	 	94	 
	Section 12.4 Binding Effect
	 	 	94	 
	Section 12.5 Term of this Agreement
	 	 	94	 
	Section 12.6 GOVERNING LAW; CONSENT TO JURISDICTION; WAIVER OF OBJECTION TO VENUE
	 	 	94	 
	Section 12.7 WAIVER OF JURY TRIAL
	 	 	95	 
	Section 12.8 Costs, Expenses and Taxes
	 	 	95	 
	Section 12.9 No Proceedings
	 	 	95	 
	Section 12.10 Recourse Against Certain Parties
	 	 	96	 

ii

 

	 	 	 	 	 
	 	 	Page	 
	Section 12.11 Protection of Security Interest; Appointment of Administrative Agent as Attorney-in-Fact
	 	 	96	 
	Section 12.12 Confidentiality
	 	 	97	 
	Section 12.13 Execution in Counterparts; Severability; Integration
	 	 	98	 
	Section 12.14 Performance Undertaking
	 	 	98	 

iii

 

EXHIBITS

	 	 	 

	EXHIBIT A

	 	Form of Borrower Notice
	EXHIBIT B

	 	Form of Note
	EXHIBIT C

	 	Form of Assignment Agreement
	EXHIBIT D

	 	Form of Conversion/Continuation Notice
	EXHIBIT E

	 	[Reserved]
	EXHIBIT F

	 	Form of Manager’s Certificate
	EXHIBIT G

	 	Form of Custodian Receipt and Initial Certification
	EXHIBIT H

	 	Form of Custodian Receipt and Monthly Certification
	EXHIBIT I

	 	Form of Assignment of Mortgage
	EXHIBIT J

	 	Form of Request for Release of Loan Asset File and Receipt
	EXHIBIT K

	 	[Reserved]
	EXHIBIT L

	 	Form of Account Control Agreement

SCHEDULES

	 	 	 

	SCHEDULE I

	 	Schedule of Documents
	SCHEDULE II

	 	[Reserved]
	SCHEDULE III

	 	Schedule of Loan Assets
	SCHEDULE IV

	 	Location of Loan Asset Files
	SCHEDULE V

	 	Lender Commitments
	SCHEDULE VI

	 	Schedule of Closing Date Loan Assets
	SCHEDULE VII

	 	Notice Addresses
	SCHEDULE VIII

	 	Key Persons
	SCHEDULE IX

	 	Specified Holders

iv

 

     THIS CREDIT, SECURITY AND MANAGEMENT AGREEMENT is made as of July 30, 2010 (this
“Agreement” or this “Credit Agreement”, as amended, modified, supplemented or
restated from time to time), among GSC INVESTMENT FUNDING LLC, a Delaware limited liability
company, as borrower (the “Borrower”), GSC INVESTMENT CORP., a Maryland corporation, as
Performance Guarantor (the “Performance Guarantor”), SARATOGA INVESTMENT ADVISORS, LLC, a
Delaware limited liability company, as Manager (the “Manager”), each financial institution
from time to time party hereto as a “Lender” and their respective successors and assigns
(collectively, the “Lenders”), MADISON CAPITAL FUNDING LLC, as “Administrative Agent” and
its respective successors and assigns (the “Administrative Agent”), and U.S. BANK NATIONAL
ASSOCIATION, a national banking association (“U.S. Bank”), not in its individual capacity,
but solely as the custodian (together with its successors and assigns in such capacity, the
“Custodian”).

     IT IS AGREED as follows:

ARTICLE I

DEFINITIONS

Section 1.1 Certain Defined Terms.

     (a) Certain capitalized terms used throughout this Agreement are defined above or in this
Section 1.1.

     (b) As used in this Agreement and its exhibits, the following terms shall have the following
meanings (such meanings to be equally applicable to both the singular and plural forms of the terms
defined).

     “1940 Act” is defined in Section 4.1(w).

     “Account Bank” means U.S. Bank National Association, in its capacity as Securities
Intermediary pursuant to the Account Control Agreement.

     “Account Control Agreement” means the Securities Account Control Agreement, dated as
of the Closing Date, by and among the Account Bank, the Borrower, the Manager and the
Administrative Agent, substantially in the form of Exhibit L.

     “Accrual Period” means (i) as to the first Payment Date after the Closing Date, the
period beginning on the Closing Date and ending on, and including, the Determination Date
immediately preceding such Payment Date and (ii) as to any subsequent Payment Date, the period
beginning on the first day after the most recently ended Accrual Period and ending on, and
including, the Determination Date immediately preceding such Payment Date, or, with respect to the
final Accrual Period, the Collection Date.

     “Additional Amount” is defined in Section 2.12.

     “Adjusted Borrowing Value” means for any Eligible Loan Asset as at any date of
determination, an amount equal to the lower of (i) the Outstanding Principal Balance of such Loan
Asset at such time, and (ii) the Assigned Value of such Loan Asset at such time multiplied by the
Outstanding Principal Balance of such Loan Asset; provided that the Adjusted Borrowing
Value of any Loan Asset that is no longer an Eligible Loan Asset shall be zero.

 

 

     “Administrative Agent” is defined in the preamble hereto.

     “Administrative Agent Fee” is defined in the Fee Letter.

     “Administrative Agent’s Account” means account number 304938610 at JPMorgan Chase
Bank, NA.

     “Advance” is defined in Section 2.1(a).

     “Advance Date Assigned Value” means (a) with respect to any Loan Asset acquired by the
Borrower after the Closing Date, the value (expressed as a percentage of the Outstanding Principal
Balance of such Loan Asset), at the time of acquisition of such Loan Asset, equal to the lowest of
(i) the Outstanding Principal Balance of such Loan Asset, (ii) the purchase price paid by the
Borrower to acquire such Loan Asset (expressed exclusive of accrued interest) or (iii) the Fair
Value of such Loan Asset and (b) with respect to any Closing Date Loan Asset, the “Advance Date
Assigned Value” for such Closing Date Loan Asset set forth on Schedule VI hereto.

     “Advances Outstanding” means on any day, the aggregate principal amount of Advances
outstanding on such day, after giving effect to all repayments of Advances and makings of new
Advances on such day.

     “Adverse Claim” means a lien, security interest, pledge, charge, encumbrance or other
right or claim of any Person.

     “Affected Party” is defined in Section 2.11(a).

     “Affiliate” with respect to a Person, means any other Person controlling, controlled
by or under common control with such Person. For purposes of this definition, “control” when used
with respect to any specified Person means the power to direct the management and policies of such
Person, directly or indirectly, through the ownership of voting securities; and the terms
“controlling” or “controlled” have meanings correlative to the foregoing.

     “Aggregate Adjusted Borrowing Value” means, on any day, the Adjusted Borrowing Values
of all Eligible Loan Assets included as part of the Collateral on such date.

     “Aggregate Borrowing Base Value” means, on any day, the Borrowing Base Values of all
Eligible Loan Assets included as part of the Collateral on such date.

     “Aggregate ECA Value” means, on any day, the sum of (i) the Aggregate Borrowing Base
Value as of such date, plus (ii) the amount on deposit in the Collection Account
constituting Principal Collections as of such date.

     “Applicable Advance Rate” means, with respect to any Eligible Loan Asset, the
percentage with respect to such Loan Asset determined as follows:

     (a) in the case of a Closing Date Loan Asset and each Eligible Loan Asset constituting a loan
made to the same Obligor in respect of a Closing Date Loan Asset (solely to the extent such
Eligible Loan Asset has the same terms, rights and priorities as the related Closing Date Loan
Asset), the applicable percentage set forth on Schedule VI hereto for such Closing Date
Loan Asset;

2

 

     (b) in the case of an Eligible Loan Asset not described in the preceding clause (a)
constituting a Senior Secured Loan, Secured Bond or DIP Loan, 75%;

     (c) in the case of an Eligible Loan Asset not described in the preceding clause (a)
constituting a Unitranche Loan or a Hybrid Secured Bond, 65%;and

     (d) in the case of any other Eligible Loan Asset, 50%, or such higher percentage as the
Administrative Agent shall approve in writing in its sole discretion.

     “Applicable Law” means, for any Person, all existing and future applicable laws,
rules, regulations (including proposed, temporary and final income tax regulations), statutes,
treaties, codes, ordinances, permits, certificates, orders and licenses of and interpretations by
any Governmental Authority (including usury laws, the Federal Truth in Lending Act, and Regulation
Z, Regulation W, Regulation U and Regulation B of the Federal Reserve Board), and applicable
judgments, decrees, injunctions, writs, orders, or line action of any court, arbitrator or other
administrative, judicial, or quasi-judicial tribunal or agency of competent jurisdiction.

     “Applicable Margin” means, in respect of Base Rate Advances, 4.50%, and in respect of
LIBOR Rate Advances, 5.50%.

     “Approved Foreign Currency” means Canadian Dollars.

     “Approved Fund” means (a) any fund, trust or similar entity that invests in commercial
loans in the ordinary course of business and is advised or managed by (i) a Lender, (ii) an
Affiliate of a Lender, (iii) the same investment advisor that manages a Lender or (iv) an Affiliate
of an investment advisor that manages a Lender or (b) any finance company, insurance company or
other financial institution which temporarily warehouses loans for any Lender or any Person
described in clause (a) above.

     “Assigned Value” means, with respect to each Loan Asset, as of any date of
determination and expressed as a percentage of the outstanding principal balance of such Loan Asset
(exclusive of PIK Interest or accrued interest), the Advance Date Assigned Value of such Loan
Asset, subject to the following terms:

     (a) If a Value Adjustment Event of the type described in clauses (i) or (ii)
of the definition thereof with respect to such Loan Asset occurs, the Assigned Value of such Loan
Asset will be the Fair Value thereof (subject to the limitations contained in the such clauses
(i) and (ii)).

     (b) If a Value Adjustment Event of the type described in clause (iii)) of the
definition thereof with respect to such Loan Asset occurs, the Assigned Value of such Loan Asset
shall be the lowest Fair Value assigned to such Loan Asset in the six-month period immediately
preceding such date of determination.

     (c) If a Value Adjustment Event of the type described in clauses (iv) or (vi)
of the definition thereof with respect to such Loan Asset occurs, the Assigned Value of such Loan
Asset will be zero (or such higher percentage as the Administrative Agent shall approve in writing
in its sole discretion).

     (d) If a Value Adjustment Event of the type described in clauses (v), (vii) or
(viii) of the definition thereof with respect to such Loan Asset occurs, “Assigned Value”
may be amended by the Administrative Agent, in its sole discretion; provided that (x) the
Assigned Value of any Priced Loan Asset shall not be less than the price quoted therefor (if any)
by such nationally recognized pricing service as selected by the Administrative Agent (such quoted
price to be determined after giving effect to such

3

 

Value Adjustment Event) and (y) the Assigned Value shall not be greater than the lesser of (A)
the Assigned Value based upon the practices set forth in FASB Accounting Standards Codification 820
(formerly SFAS No. 157) or any pronouncement, statement, rule or amendment with respect to
GAAP-mandated mark-to-market requirements or (B) the Assigned Value based on the amortized cost
adjusted for any credit impairment of such Loan Asset. In the event the Borrower disagrees with
the Administrative Agent’s determination of the Assigned Value of a Loan Asset, the Borrower may
(at its expense) retain any nationally recognized valuation firm reasonably acceptable to the
Administrative Agent to value such Loan Asset and if the value determined by such firm is greater
than the Administrative Agent’s determination of the Assigned Value, such firm’s valuation shall
become the Assigned Value of such Loan Asset; provided that the Assigned Value of such Loan
Asset shall be the value assigned by the Administrative Agent until such firm has determined its
value. The value determined by such firm shall be based on the lesser of (x) the practices set
forth in FASB Accounting Standards Codification 820 (formerly SFAS No. 157) or any pronouncement,
statement, rule or amendment with respect to GAAP-mandated mark-to-market requirements and (y) the
amortized cost adjusted for any credit impairment of such Loan Asset. The Administrative Agent
shall promptly notify the Manager of any change effected by the Administrative Agent of the
Assigned Value of any Loan Asset.

     “Assignment Agreement” means an agreement substantially in the form of Exhibit
C hereto.

     “Assignment of Mortgage” means as to each Loan Asset secured by an interest in real
property, one or more assignments, notices of transfer or equivalent instruments, each in
recordable form and sufficient under the laws of the relevant jurisdiction to reflect the transfer
of the related mortgage, deed of trust, security deed or similar security instrument and all other
documents related to such Loan Asset and to the Borrower, each such Assignment of Mortgage to be
substantially in the form of Exhibit I hereto.

     “Availability” means on any day, the lesser of (i) the amount by which the Borrowing
Base exceeds the sum of Advances Outstanding and the Unfunded Exposure Amount and (ii) the amount
by which the Facility Amount exceeds the sum of Advances Outstanding and the Unfunded Exposure
Amount; provided, however, after the Termination Date, Availability shall be zero.

     “Bankruptcy Code” means The United States Bankruptcy Reform Act of 1978 (11 U.S.C. §§
101, et seq.), as amended from time to time.

     “Base Rate” means, for any day, the greatest of (i) the rate of interest which is
identified as the “Prime Rate” and normally published in the Money Rates section of The Wall
Street Journal (or, if such rate ceases to be so published, as quoted from such other generally
available and recognizable source as the Administrative Agent may select), (ii) the sum of the
Federal Funds Rate plus 0.5%, and (iii) 3.00%. Any change in the Base Rate due to a change in such
Prime Rate or the Federal Funds Rate shall be effective on the effective date of such change in
such Prime Rate or the Federal Funds Rate.

     “Base Rate Advance” means any Advance which bears interest at or by reference to the
Base Rate.

     “Benefit Plan” means any employee benefit plan as defined in Section 3(3) of ERISA in
respect of which the Borrower or any ERISA Affiliate of the Borrower is, or at any time during the
immediately preceding six years was, an “employer” as defined in Section 3(5) of ERISA.

     “Borrower” means GSC Investment Funding LLC, a Delaware limited liability company, or
any permitted successor thereto.

4

 

     “Borrower Notice” means a written notice, in the form of Exhibit A, to be used
for each borrowing, repayment of each Advance or termination or reduction of the Facility Amount or
prepayments of Advances, each Discretionary Sale, withdrawal of Principal Collections or withdrawal
of amounts on deposit in the Unfunded Exposure Account, which notice shall include a pro forma
calculation of the Borrowing Base and the Coverage Tests and, in the case of the initial inclusion
of a Loan Asset in the Collateral, evidence of receipt of the unanimous approval for the
origination or acquisition of such Loan Asset from each member of GSC Investment’s investment
committee.

     “Borrowing Base” means, as of any date of determination, an amount equal to the lesser
of:

     (a) the sum of (i) the Aggregate Borrowing Base Value minus (ii) the Excess
Concentration Amount as of such date, plus (iii) the amount on deposit in the Collection
Account constituting Principal Collections as of such date; or

     (b) the Facility Amount;

     provided that, for the avoidance of doubt, any Loan Asset which at any time is no
longer an Eligible Loan Asset shall not be included in the calculation of “Borrowing Base”.

     “Borrowing Base Test” means, as of any date of determination, a determination that the
Borrowing Base shall be equal to or greater than Advances Outstanding.

     “Borrowing Base Value” means, for any Eligible Loan Asset as of any date of
determination, an amount equal to the product of (A) the Applicable Advance Rate for such Eligible
Loan Asset as of such date times (B) the Adjusted Borrowing Value of such Eligible Loan Asset as of
such date.

     “Breakage Costs” is defined in Section 2.10.

     “Business Day” means any day on which commercial banks are open for commercial banking
business in Chicago, Illinois, Charlotte, North Carolina and New York, New York, and, in the case
of a Business Day which relates to a LIBOR Rate Advance, on which dealings are carried on in the
London interbank eurodollar market.

     “Canadian Dollars” means the lawful currency of Canada.

     “Change-in-Control” means (i) any Person or “group” acquires any “beneficial
ownership” (as such terms are defined under Rule 13d-3 of, and Regulation 13D under, the Securities
Exchange Act of 1934, as amended), either directly or indirectly, of membership interests or other
equity interests or any interest convertible into any such interest in GSC Investment having more
than 50% of the voting power for the election of directors of GSC Investment under ordinary
circumstances, (ii) the Performance Guarantor ceases to own and control, directly or indirectly,
100% of the equity interests of the Borrower free and clear of all liens, or (iii) the dissolution,
termination or liquidation in whole or in part, transfer or other disposition, in each case, of all
or substantially all of the assets of, the Performance Guarantor.

     “CLO” means GSC Investment Corp. CLO 2007, Ltd., a Cayman Islands exempted company.

     “CLO Equity” means the subordinated notes issued by GSC Investment Corp. CLO 2007,
Ltd. and held by the Borrower.

     “CLO Management Agreement” means that certain Collateral Management Agreement, dated
as of January 22, 2008, by and between GSC Investment Corp. CLO 2007, Ltd. and GSC Investment.

5

 

     “CLO Management Fees” means, collectively, the senior collateral management fees,
subordinated collateral management fees and incentive collateral management fees payable under the
CLO Management Agreement.

     “CLO Management Contribution Agreement” means the Contribution Agreement among GSC
Investment, the Borrower and the Administrative Agent.

     “Closing Date” means July 30, 2010.

     “Closing Date Loan Assets” means the Loan Assets owned by the Borrower on the Closing
Date and identified on Schedule VI attached hereto.

     “Code” means the Internal Revenue Code of 1986, as amended.

     “Collateral” means all right, title and interest of the Borrower in, to and under all
accounts, cash and currency, chattel paper, tangible chattel paper, electronic chattel paper,
copyrights, copyright licenses, equipment, fixtures, contract rights, general intangibles,
instruments, certificates of deposit, certificated securities, uncertificated securities, financial
assets, securities entitlements, commercial tort claims, deposit accounts, inventory, investment
property, letter-of-credit rights, software, supporting obligations, accessions and other personal
property of the Borrower, whether now owned or hereafter acquired or arising, and wherever located,
including, without limitation the following:

     (i) the Loan Assets, and all monies due or to become due in payment of such Loan Assets on
and after the related Purchase Date;

     (ii) any Related Property securing the Loan Assets including all Proceeds from any sale or
other disposition of such Related Property;

     (iii) the Loan Asset Documents relating to the Loan Assets;

     (iv) the Collection Account, the Reserve Account and the Unfunded Exposure Account, all
funds held in such accounts, and all certificates and instruments, if any, from time to time
representing or evidencing such accounts or such funds;

     (v) all Collections and all other payments made or to be made in the future with respect to
the Loan Assets, including such payments under any guarantee or similar credit enhancement with
respect to such Loan Assets;

     (vi) all Hedge Collateral;

     (vii) all right, title and interest (but none of the obligations) in, to and under the
Purchase Agreement and the CLO Management Contribution Agreement;

     (viii) all right, title and interest (but none of the obligations) in, to and under the CLO
Equity and all Supplemental Interests;

     (ix) all right, title and interest (but none of the obligations) in respect of the CLO
Management Fees; and

     (x) all income and Proceeds of the foregoing.

6

 

     “Collateral Tests” means each of the Borrowing Base Test, the Coverage Tests and the
Weighted Average FMV Test.

     “Collection Account” is defined in Section 5.3(a).

     “Collection Date” means the date following the Termination Date on which all Advances
Outstanding have been reduced to zero, the Lenders have received all accrued Interest, fees, and
all other amounts owing to them under this Agreement and the Hedging Agreement, the Hedge
Counterparties have received all amounts due and owing hereunder and under the Hedge Transactions,
and each of the Custodian and the Administrative Agent have each received all amounts due to them
in connection with the Transaction Documents.

     “Collections” means (a) all cash collections or other cash proceeds of a Loan Asset or
other Collateral received by or on behalf of the Borrower by the Manager or Performance Guarantor
from or on behalf of any Obligor in payment of any amounts owed in respect of such Loan Asset or
other Collateral (including CLO Equity and Supplemental Interests), including fees, interest,
dividends, distributions, Principal Collections, Insurance Proceeds, all Recoveries and any
payments made by the Performance Guarantor pursuant to Section 12.14, (b) all CLO
Management Fees, (c) all amounts received by the Borrower in connection with the repurchase of an
Ineligible Loan Asset pursuant to Section 6.1 of the Purchase Agreement, (d) all amounts or
Proceeds received by or on behalf of the Borrower or the Administrative Agent in connection with a
Discretionary Sale pursuant to Section 2.14, (e) all payments received pursuant to any
Hedging Agreement or Hedge Transaction, and (f) interest earnings in the Controlled Accounts;
provided that, for the avoidance of doubt, “Collections” shall not include amounts on
deposit in the Unfunded Exposure Account which do not represent proceeds of Permitted Investments.

     “Commitment” means (a) for each Lender, the commitment of such Lender to fund any
Advance to the Borrower in an amount not to exceed the amount set forth opposite such Lender’s name
on Schedule V to this Agreement, as such amount may be modified in accordance with the
terms hereof and (b) with respect to any Person who becomes a Lender pursuant to an Assignment
Agreement or pursuant to Section 2.3(b), the commitment of such Person to fund any Advance
to the Borrower in an amount not to exceed the amount set forth in such Assignment Agreement or
other document pursuant to which such Person becomes a Lender in accordance with Section
2.3(b), as such amount may be modified in accordance with the terms hereof.

     “Commitment Fee” has the meaning set forth in Section 2.13.

     “Commitment Termination Date” means July 30, 2013.

     “Contractual Obligation” means with respect to any Person, means any provision of any
securities issued by such Person or any indenture, mortgage, deed of trust, contract, undertaking,
agreement, instrument or other document to which such Person is a party or by which it or any of
its property is bound or is subject.

     “Controlled Accounts” means the Collection Account, the Reserve Account and the
Unfunded Exposure Account.

     “Conversion/Continuation Notice” means a notice in substantially the form of
Exhibit D.

     “Coverage Tests”: A test that is satisfied as of any Determination Date, if both (i)
the Overcollateralization Ratio is equal to or greater than 200% and (ii) the Interest Coverage
Ratio is equal to or greater than 175%.

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     “Currency Hedge Transaction” means each currency swap transaction, index rate swap or
interest rate cap transaction or comparable derivative arrangements, in each case, as the
Administrative Agent may approve in its discretion between the Borrower and a Hedge Counterparty
that is entered into pursuant to Section 5.2(b) and is governed by a Hedging Agreement.

     “Custodian” means U.S. Bank National Association, in its capacity as Custodian,
together with its successors and assigns.

     “Custodian Expenses” means the out-of-pocket expenses to be paid to the Custodian
under the Custodian Fee Letter.

     “Custodian Fee” means the fee to be paid to the Custodian as set forth in the
Custodian Fee Letter.

     “Custodian Fee Letter” means the Custodian Fee Letter, dated as of the date hereof,
among the Borrower, the Custodian and the Administrative Agent, as the same may from time to time
be amended, waived or modified.

     “Default” means an event that, with the giving of notice or lapse of time, or both,
would become an Event of Default.

     “Defaulted Loan Asset” means any Loan Asset (i) as to which there has occurred and is
continuing a default with respect to the payment of interest or principal; provided, that
any such default may continue for a period of up to the lesser of (a) the length of any applicable
grace period or waiver set forth for the underlying Loan Asset and (b) 10 days from the date of
such default (in the case of a Loan Asset other than a Secured Bond or Unsecured Bond) or 30 days
from the date of such default (in the case of a Loan Asset consisting of a Secured Bond or an
Unsecured Bond), (ii) in respect of which the Manager or Performance Guarantor (or the applicable
agent on behalf of the lenders under the Loan Asset Documents related to such Loan Asset) shall
have taken (and not rescinded or otherwise terminated) any of the following actions: acceleration
of the Loan Asset or exercising rights and remedies against the collateral for the Loan Asset,
(iii) for which an Insolvency Event has occurred with respect to the related Obligor (other than in
the case of (x) a pre-packaged bankruptcy of the related Obligor approved by the Administrative
Agent in its sole discretion or (y) a DIP Loan), or (iv) if such Loan Asset is a PIK Loan Asset,
for which the related Obligor has not paid current interest on the two most recent payment dates
therefor.

     “Delayed Funding Loan Asset” means each Loan Asset with respect to which the Borrower
has a revolving credit or delayed draw term commitment to advance amounts to the applicable Obligor
during a specified term.

     “Derivatives” means any exchange-traded or over-the-counter (i) forward, future,
option, swap, cap, collar, floor, foreign exchange contract, any combination thereof, whether for
physical delivery or cash settlement, relating to any interest rate, interest rate index, currency,
currency exchange rate, currency exchange rate index, debt instrument, debt price, debt index,
depository instrument, depository price, depository index, equity instrument, equity price, equity
index, commodity, commodity price or commodity index, (ii) any similar transaction, contract,
instrument, undertaking or security, or (iii) any transaction, contract, instrument, undertaking or
security containing any of the foregoing.

     “Determination Date” means the last day of each Settlement Period.

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     “DIP Loan” means a Loan Asset (i) which is an obligation of a debtor-in-possession
pursuant to Section 364 of the Bankruptcy Code, (ii) the terms of which have been approved by an
order of a United States Bankruptcy Court, a United States District Court, or any other court of
competent jurisdiction, the enforceability of which order is not subject to any pending contested
matter or proceeding (as such terms are defined in the Federal Rules of Bankruptcy Procedure),
(iii) which is secured by liens having the priority allowed by either Section 364(c) or 364(d) of
the Bankruptcy Code, (iv) which pays cash interest on a current basis, and (v) which has paid its
most recent scheduled interest and principal payments (if any) and the Manager reasonably expects
that the Loan Asset will continue to pay interest and principal on a current basis.

     “Discretionary Sale” is defined in Section 2.14.

     “Discretionary Sale Settlement Date” means the Business Day specified by the Borrower
to the Administrative Agent and the Custodian in a Borrower Notice of a Discretionary Sale as the
proposed settlement date of a Discretionary Sale.

     “Discretionary Sale Trade Date” means the Business Day specified by the Borrower to
the Administrative Agent and the Custodian in a Borrower Notice of a Discretionary Sale as the
proposed trade date of a Discretionary Sale.

     “Dollars” or “$” means the lawful currency of the United States of America.

     “EBITDA” means, with respect to any period and any Loan Asset, the meaning of
“EBITDA”, “Adjusted EBITDA” or any comparable definition in the Loan Asset Documents for each such
Loan Asset (together with all add-backs and exclusions as designated in such documents), and in any
case that “EBITDA”, “Adjusted EBITDA” or such comparable definition is not defined in such Loan
Asset Documents, an amount, for the principal obligor on such Loan Asset and any of its parents or
subsidiaries that are obligated pursuant to the Loan Asset Documents for such Loan Asset
(determined on a consolidated basis without duplication in accordance with GAAP) equal to earnings
from continuing operations for such period plus interest expense, income taxes and unallocated
depreciation and amortization for such period (to the extent deducted in determining earnings from
continuing operations for such period), and any other item the Borrower and the Administrative
Agent mutually deem to be appropriate.

     “Effective Interest Rate” means, with respect to a Loan Asset, a rate of interest
determined by (x) multiplying the outstanding principal balance of such Loan Asset by the current
cash interest rate set forth in the applicable Loan Asset Document, and dividing such result by (y)
the acquisition price of such Loan Asset paid in cash by the Borrower or, in the case of a Loan
Asset that is originated by the Borrower, the par amount of such Loan Asset net of any original
issue discount applicable thereto (in either case expressed as a percentage of the outstanding
principal balance of such Loan Asset).

     “Eligible Loan Asset” means on any date of determination, a Senior Secured Loan,
Second Lien Loan, DIP Loan, Mezzanine Loan, Secured Bond, Unitranche Loan, Hybrid Secured Bond or
Unsecured Bond which satisfies each of the following requirements:

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

     (ii) such Loan Asset is not a Defaulted Loan Asset;

9

 

     (iii) such Loan Asset is denominated in Dollars or an Approved Foreign Currency;

     (iv) such Loan Asset has not been amended after the origination or acquisition thereof
by the Borrower (or, in the case of a Closing Date Loan Asset, after the Closing Date) in a
manner that would constitute a Material Modification, unless consented to by the
Administrative Agent;

     (v) such Loan Asset will not, as of the date of origination or acquisition thereof by
the Borrower, cause the Borrower to be deemed to own 5.0% or more of the voting securities
of any publicly registered issuer or any securities that are immediately convertible into or
immediately exercisable or exchangeable for 5.0% or more of the voting securities of any
publicly registered issuer, as determined by the Manager;

     (vi) the Obligor with respect to such Loan Asset is an Eligible Obligor;

     (vii) the Loan Asset Documents with respect to the Loan contain a provision
substantially to the effect that the related Obligor’s payment obligations are not subject
to rights of rescission, set-off and counterclaim against the Borrower and its assignees;

     (viii) such Loan Asset does not contain a confidentiality provision that restricts the
ability of the Administrative Agent, on behalf of the Secured Parties, to exercise its
rights under the Transaction Documents, including its rights to review the Loan Asset and
related Loan Asset File; provided, however, that a provision which requires
the Custodian or other prospective recipient of confidential information to maintain the
confidentiality of such information shall not be deemed to restrict the exercise of such
rights;

     (ix) such Loan Asset (i) in the case of a Loan Asset that is not a Closing Date Loan
Asset, was originated and underwritten, or purchased and re-underwritten, by the Borrower
including the completion of a collateral assessment and (ii) is being managed by the Manager
on behalf of the Borrower, in each case in accordance with the Investment Guidelines and the
Management Standards;

     (x) other than with respect to Delayed Funding Loan Assets, such Loan Asset does not
require the Borrower to make future advances to the Obligor under the related Loan Asset
Documents;

     (xi) such Loan Asset does not cause the aggregate maximum commitments of all Delayed
Funding Loan Assets to exceed $3,000,000;

     (xii) such Loan Asset provides for at least 50% of the total interest payable by the
Obligor to be payable in cash on a current basis;

     (xiii) other than with respect to the Closing Date Loan Assets, such Loan Asset
provides for an Effective Interest Rate of at least 7.50% per annum;

     (xiv) the financial statements most recently delivered by the Obligor with respect to
such Loan Asset reflect EBITDA greater than zero;

     (xv) such Loan Asset provides for a fixed amount of principal payable in cash no later
than its stated maturity;

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     (xvi) such Loan Asset provides for periodic payments of accrued and unpaid interest in
cash no less frequently than semi-annually;

     (xvii) such Loan Asset has an original term to maturity of no more than 120 months;

     (xviii) if such Loan Asset is a Delayed Funding Loan Asset, the commitment of the
Borrower to the applicable Obligor thereunder shall have a term to maturity not greater than
the Maturity Date;

     (xix) the proceeds of such Loan Asset are not used to finance construction projects or
activities or “hostile” acquisitions;

     (xx) with respect to which the Custodian has received, or will receive, within five (5)
Business Days of the date on which the Borrower acquires an interest in such Loan Asset, the
related Loan Asset File;

     (xxi) the Obligor of such Loan Asset has executed all appropriate documentation
required by the Performance Guarantor, the Manager or the Borrower, as applicable, and the
Investment Guidelines;

     (xxii) such Loan Asset is (i) a “general intangible”, an “instrument”, an “account”, or
“chattel paper” within the meaning of the Article 9 of the UCC or (ii) a “financial asset”,
“security” or “security entitlement” within the meaning of Article 8 of the UCC, in each
case, in all jurisdictions that govern the perfection of the security interest granted
therein;

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

     (xxiv) such Loan Asset, together with the Loan Asset Documents related thereto, does
not contravene in any material respect any Applicable Laws (including laws, rules and
regulations relating to usury, truth in lending, fair credit billing, fair credit reporting,
equal credit opportunity, fair debt collection practices and privacy);

     (xxv) such Loan Asset, together with the related Loan Asset Documents, is fully
assignable, subject to receipt of any necessary consents (and if such Loan Asset is secured
by an interest in real property and to the extent the Borrower is the sole lender under the
related Loan Asset Documents, an Assignment of Mortgage executed in blank has been delivered
to the Custodian);

     (xxvi) the Borrower’s interest in such Loan Asset and all Related Property is owned by
the Borrower free and clear of any Liens except for Permitted Liens, and all filings and
other actions required to perfect the security interest of the Administrative Agent on
behalf of the Secured Parties in such Loan Asset have been made or taken;

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

11

 

     (xxviii) the financing of such Loan Asset by the Lenders does not contravene in any
material respect Regulation U of the Federal Reserve Board, nor require the Lenders to
undertake reporting thereunder which it would not otherwise have cause to make;

     (xxix) no claim has been asserted or proceeding commenced in respect of such Loan Asset
challenging the enforceability or validity of any of the related Loan Asset Documents; and

     (xxx) the origination and/or acquisition of such Loan Asset has been unanimously
approved by each member of the Manager’s or GSC Investment’s investment committee.

Notwithstanding the foregoing, in no event shall any Loan Asset or other Collateral identified as
“Category 3” on Schedule VI attached hereto be an Eligible Loan Asset unless the
Administrative Agent consents in writing.

     “Eligible Obligor” means on any day, any Obligor that satisfies each of the following
requirements:

(i) such Obligor’s principal office and any Related Property are located in the United
States or any territory of the United States;

(ii) such Obligor is not a Governmental Authority; and

(iii) except with respect to Advanced Lighting Technologies, Inc., such Obligor is not (A)
an Affiliate of the Borrower, the Manager or the Performance Guarantor or (B) an entity to
which the Borrower, the Manager or the Performance Guarantor would be deemed an Insider,
unless such Obligor has been approved by the Administrative Agent.

     “ERISA” means the U.S. Employee Retirement Income Security Act of 1974, as amended
from time to time, and the regulations promulgated and rulings issued thereunder.

     “ERISA Affiliate” means (a) any corporation that is a member of the same controlled
group of corporations (within the meaning of Section 414(b) of the Code) as the Borrower; (b) a
trade or business (whether or not incorporated) under common control (within the meaning of Section
414(c) of the Code) with the Borrower or (c) a member of the same affiliated service group (within
the meaning of Section 414(m) of the Code) as the Borrower, any corporation described in clause (a)
above or any trade or business described in clause (b) above.

     “Eurodollar Disruption Event” means with respect to any Advance as to which Interest
accrues or is to accrue at a rate based upon the LIBOR Rate, any of the following: (a) a
determination by a Lender that it would be contrary to law or to the directive of any central bank
or other governmental authority (whether or not having the force of law) to obtain United States
dollars in the London interbank market to make, fund or maintain any Advance; (b) the inability of
any Lender to obtain timely information for purposes of determining the LIBOR Rate; (c) a
determination by a Lender that the rate at which deposits of United States dollars are being
offered to such Lender in the London interbank market does not accurately reflect the cost to such
Lender of making, funding or maintaining any Advance; or (d) the inability of a Lender to obtain
United States dollars in the London interbank market to make, fund or maintain any Advance.

     “Excess Concentration Amount” means, on any date of determination, the sum of, without
duplication:

12

 

     (a) (x) the aggregate amount by which the total of the Borrowing Base Values of Eligible Loan
Assets (other than the GFSI Loan only so long as the Interim Test is satisfied) which are made to
any single Obligor, exceeds 15% of the Aggregate ECA Value and (y) only so long as the Interim Test
is satisfied, the aggregate amount by which the Borrowing Base Value of the GFSI Loan exceeds 20.5%
of the Aggregate ECA Value;

     (b) (x) the aggregate amount by which the total of the Borrowing Base Values of Eligible Loan
Assets (other than the GFSI Loan only so long as the Interim Test is satisfied) which are made to
Obligors in any one Industry (other than healthcare), exceeds 15% of the Aggregate ECA Value, the
aggregate amount by which the total of the Borrowing Base Values of Eligible Loan Assets which are
made to Obligors in the healthcare Industry, exceeds 25% of the Aggregate ECA Value, the aggregate
amount by which the total of the Borrowing Base Values of Eligible Loan Assets which are made to
Obligors in the home health, hospice and diagnostic imaging Industries, collectively, exceeds 15%
of the Aggregate ECA Value and (y) only so long as the Interim Test is satisfied, the aggregate
amount by which total of the Borrowing Base Value of the GFSI Loan plus the Borrowing Base Values
of all other Eligible Loan Assets which are made to Obligors in the same Industry as the Obligor in
respect of the GFSI Loan, exceeds 20.5% of the Aggregate ECA Value;

     (c) (x) the aggregate amount by which the total of the Borrowing Base Values of Eligible Loan
Assets (other than the GFSI Loan only so long as the Interim Test is satisfied) which are made to
the three largest Obligors (determined by Adjusted Borrowing Value of the related Eligible Loan
Asset), exceeds (i) during the period from the Closing Date until and including the first
anniversary of the Closing Date, 36% of the Aggregate ECA Value, (ii) during the period from but
excluding the first anniversary of the Closing Date until and including the second anniversary of
the Closing Date, 30% of the Aggregate ECA Value, and (iii) thereafter, 25% of the Aggregate ECA
Value and (y) if the Obligor in respect of the GFSI Loan is one of the three largest Obligors
(determined by Adjusted Borrowing Value of the related Eligible Loan Asset) and the Interim Test is
satisfied, the aggregate amount by which the total of the Borrowing Base Values of Eligible Loan
Assets which are made to such three largest Obligors, exceeds 40% of the Aggregate ECA Value;

     (d) the aggregate amount by which the total of the Borrowing Base Values of Eligible Loan
Assets (other than Closing Date Loan Assets) which are made to (i) a single Obligor of an Eligible
Loan Asset the Assigned Value of which is less than 65%, exceeds 10% of the Aggregate ECA Value and
(ii) a single Obligor of an Eligible Loan Asset the Assigned Value of which is less than 50%,
exceeds 5% of the Aggregate ECA Value;

     (e) the aggregate amount by which the total of the Borrowing Base Values of Eligible Loan
Assets which have a scheduled maturity date beyond the date which is 9 months before the scheduled
Maturity Date, exceeds 50% of the Aggregate ECA Value;

     (f) the aggregate amount by which the total of the Borrowing Base Values of all Eligible Loan
Assets which are Eligible Loan Assets denominated in Canadian Dollars exceeds 10% of the Aggregate
ECA Value; provided, that, all Collections received on such Eligible Loan Assets
denominated in Canadian Dollars shall be converted into Dollars pursuant to the terms of one or
more Currency Hedge Transactions in accordance with Section 5.2(b);

     (g) the aggregate amount by which the total of the Borrowing Base Values of all Eligible Loan
Assets which are Eligible Loan Assets not denominated in Canadian Dollars or Dollars exceeds 0% of
the Aggregate ECA Value, and the aggregate amount by which the total of the Borrowing Base Values
of all Eligible Loan Assets which are Eligible Loan Assets denominated in Canadian Dollars not
subject to a Hedge Transaction exceeds 0% of the Aggregate ECA Value;

13

 

     (h) the aggregate amount by which the total of the Borrowing Base Values of all Eligible Loan
Assets which are real estate loans principally secured by real property exceeds 10% of the
Aggregate ECA Value; and

     (i) the aggregate amount by which the total of the Borrowing Base Values of all Eligible Loan
Assets (other than Closing Date Loan Assets) which (i) do not have at least one Maintenance
Covenant and (ii) are not Liquid Loan Assets exceeds 10% of the Aggregate ECA Value.

     “Event of Default” is defined in Section 8.1.

     “Exposure Amount” means, as of any date of determination, with respect to any Delayed
Funding Loan Asset, the excess, if any, of (i) the maximum commitment of the Borrower under the
terms of the applicable Loan Asset Document to make advances (and, for the avoidance of doubt, the
Borrower’s commitment in respect of a Loan Asset as to which the commitment to make additional
advances has been terminated shall be zero) over (ii) the outstanding principal balance of
such Loan Asset on such date of determination.

     “Facility Amount” means, on the Closing Date, $40,000,000, as such amount may be
increased pursuant to Section 2.3(b); provided, however, that on or after the
Termination Date, the Facility Amount shall at all times be equal to the amount of Advances
Outstanding.

     “Facility Obligations” means all loans, advances, debts, liabilities and obligations,
for monetary amounts owing by the Borrower to the Lenders, the Administrative Agent or any of their
permitted assigns, as the case may be, whether due or to become due, matured or unmatured,
liquidated or unliquidated, contingent or non-contingent, and all covenants and duties regarding
such amounts, of any kind or nature, present or future, arising under or in respect of any of this
Agreement, the Fee Letter, any other Transaction Document delivered in connection with the
transactions contemplated by this Agreement, or any Hedging Agreement, as amended or supplemented
from time to time, whether or not evidenced by any separate note, agreement or other instrument.
This term includes, without limitation, all principal, interest (including interest that accrues
after the commencement against the Borrower of any action under the Bankruptcy Code), any
Prepayment Fee, Breakage Costs, Hedge Breakage Costs, fees, including any and all arrangement fees,
loan fees, facility fees, and any and all other fees, expenses, costs or other sums (including
attorney costs) chargeable to the Borrower under any of the Transaction Documents or under any
Hedging Agreement.

     “Fair Value” means with respect to each Loan Asset, expressed as a percentage of the
par amount of such Loan Asset unless the context requires otherwise, the lower of (a) the remaining
outstanding principal amount of such Loan Asset, and (b) if such Loan Asset has been reduced in
value on the books of GSC Investment below the remaining principal amount thereof, the value of
such Loan Asset on such books as required by, and in accordance with, the 1940 Act, as amended, and
any orders of the SEC issued to GSC Investment, to be determined by the Board of Directors of GSC
Investment (based on input from its audit committee, investment adviser and independent valuation
firm (if applicable)) and reviewed by its auditors.

     “FASB” is defined in Section 2.11(a).

     “Federal Funds Rate” means, for any day, a rate per annum (rounded upward to the
nearest 1/100th of 1%) equal to the rate published by the Federal Reserve Bank of New York on the
preceding Business Day or, if no such rate is so published, the average rate per annum, as
determined by the Administrative Agent, quoted for overnight Federal Funds transactions last
arranged prior to such day.

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     “Federal Reserve Board” means the Board of Governors of the Federal Reserve System.

     “Fee Letter” means the letter agreement in respect of fees between the Borrower and
the Administrative Agent, as it may be amended or modified and in effect from time to time.

     “Fixed Rate Loan Asset” means a Loan Asset that bears interest at a fixed rate.

     “Floating Rate Loan Asset” means a Loan Asset that bears interest at a floating rate.

     “Foreign Lender” is defined in Section 2.12(d).

     “FRB” means the Board of Governors of the Federal Reserve System or any successor
thereto.

     “Funding Date” means any day on which an Advance is made in accordance with and
subject to the terms and conditions of this Agreement.

     “Funding Request” means a Borrower Notice requesting an Advance and including the
items required by Section 2.2.

     “GAAP” means generally accepted accounting principles as in effect from time to time
in the United States.

     “GFSI Loan” means the Closing Date Loan Asset the Obligor of which is GFSI, Inc.

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

     “Gross Asset Value” means at any time the aggregate value, determined in accordance
with the following two sentences, of the assets of the Borrower that would appear on a balance
sheet of the Borrower prepared as of such time in accordance with GAAP, excluding cash and cash
equivalents. If the Board of Directors of GSC Investment has approved the valuation of the assets
of the Borrower as of such time, then Gross Asset Value shall be based on such asset valuations.
Otherwise, Gross Asset Value as of such time shall be the Manager’s good faith estimate thereof
based on the most recent valuation of the assets of the Borrower approved by the Board of Directors
of GSC Investment, adjusted for changes in the Loan Assets and market conditions.

     “GSC Investment” means GSC Investment Corp., a Maryland corporation, or any permitted
successor thereto.

     “Hedge Breakage Costs” means for any Hedge Transaction, any amount payable by the
Borrower for the early termination of that Hedge Transaction or any portion thereof.

     “Hedge Collateral” is defined in Section 5.2(c).

     “Hedge Counterparty” means any entity that (a) on the date of entering into any Hedge
Transaction (i) is an interest rate swap dealer that is either a Lender or an Affiliate of a
Lender, or has been approved in writing by the Administrative Agent (which approval shall not be
unreasonably withheld), and (ii) has a short-term unsecured debt rating of not less than A-1 by S&P
and not less than P-1 by Moody’s, and (b) in a Hedging Agreement (i) consents to the assignment of
the Borrower’s rights

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under the Hedging Agreement to the Administrative Agent pursuant to Section 5.2(b) and
(ii) agrees that in the event that S&P or Moody’s reduces its short-term unsecured debt rating
below A-1 or P-1, respectively, it shall transfer its rights and obligations under each Hedging
Transaction to another entity that meets the requirements of clause (a) and (b) hereof or make
other arrangements acceptable to the Administrative Agent.

     “Hedge Transaction” means each Interest Rate Hedge Transaction and each Currency Hedge
Transaction.

     “Hedge Trigger Period” means, at any time, a period that exists when the outstanding
Advances at such time exceed the aggregate outstanding principal balance of all Eligible Loan
Assets bearing interest based on the London interbank offered rate at such time.

     “Hedging Agreement” means each agreement between the Borrower and a Hedge Counterparty
that governs one or more Hedge Transactions entered into pursuant to Section 5.2, which
agreement shall consist of a “Master Agreement” in a form published by the International Swaps and
Derivatives Association, Inc., together with a “Schedule” thereto substantially in a form as the
Administrative Agent shall approve in writing, and each “Confirmation” thereunder confirming the
specific terms of each such Hedge Transaction.

     “Hybrid Secured Bond” means a secured bond (i) that is not (and cannot by its terms
become) subordinated in right of payment by its terms to unsecured indebtedness of the Obligor for
borrowed money (other than with respect to liquidation, trade claims, capitalized leases or other
similar obligations) and the lien of which is not subordinated to any other secured obligation of
the Obligor secured by all or a portion of the collateral securing such secured bond; (ii) is
secured by a valid and perfected first priority Lien on all of the Obligor’s assets constituting
Related Property for the Loan Asset, subject to (x) a Lien (if any) on assets of the Obligor
securing indebtedness of the Obligor in a maximum principal amount (including the unfunded portion
of any commitments thereunder) not exceeding 20% of the sum of such maximum principal amount
thereof plus the maximum principal amount (including the unfunded portion of any commitments
thereunder) of all indebtedness issued under the same bond issue to which such Hybrid Secured Bond
was issued and (y) any “permitted liens” as defined in the applicable Loan Asset Documents for such
Loan Asset or such comparable definition if “permitted liens” is not defined therein, so long as
such definition is reasonable and customary, (iii) as of the date such Loan Asset is initially
included in the Collateral, has a Loan-to-Value Ratio not greater than 55% and with respect to
which the Obligor Net Leverage Ratio is less than 4.0 to 1.0; and (iv) that is not secured solely
or primarily by the common stock or other equity interests of its Obligor or any of its affiliates.

     “Increased Costs” means any amounts required to be paid by the Borrower to an Affected
Party pursuant to Section 2.11.

     “Indebtedness” means with respect to any Person at any date, (a) all indebtedness of
such Person for borrowed money or for the deferred purchase price of property or services (other
than current liabilities incurred in the ordinary course of business and payable in accordance with
customary trade practices) or that is evidenced by a note, bond, debenture or similar instrument,
(b) all obligations of such Person under capital leases, (c) all obligations of such Person in
respect of acceptances issued or created for the account of such Person, (d) all liabilities
secured by any Adverse Claims on any property owned by such Person even though such Person has not
assumed or otherwise become liable for the payment thereof, and (e) all indebtedness, obligations
or liabilities of that Person in respect of Derivatives, and (f) obligations under direct or
indirect guaranties in respect of obligations (contingent or otherwise) to purchase or otherwise
acquire, or to otherwise assure a creditor against loss in respect of, clauses (a) through
(e) above.

16

 

     “Indemnified Amounts” is defined in Section 9.1.

     “Indemnified Party” is defined in Section 9.1.

     “Independent” means, as to any Person, any other Person (including, in the case of an
accountant, or lawyer, a firm of accountants or lawyers and any member thereof or an investment
bank and any member thereof) who (i) does not have and is not committed to acquire any material
direct or any material indirect financial interest in such Person or in any Affiliate of such
Person, and (ii) is not connected with such Person as an officer, employee, promoter, underwriter,
voting trustee, partner, director or Person performing similar functions. “Independent” when used
with respect to any accountant may include an accountant who audits the books of such Person if in
addition to satisfying the criteria set forth above the accountant is independent with respect to
such Person within the meaning of Rule 101 of the Code of Ethics of the American Institute of
Certified Public Accountants.

     “Independent Director” means a natural person who, (A) for the five-year period prior
to his or her appointment as Independent Director, has not been, and during the continuation of his
or her service as Independent Director is not: (i) an employee, director, stockholder, member,
manager, partner or officer of the Borrower, the Performance Guarantor, the Manager or any of their
respective Affiliates (other than his or her service as an Independent Director of the Borrower,
the Performance Guarantor, the Manager or other Affiliates that are structured to be “bankruptcy
remote”); (ii) a customer or supplier of the Borrower, the Performance Guarantor, the Manager or
any of their Affiliates (other than his or her service as an Independent Director of the Borrower);
or (iii) any member of the immediate family of a person described in (i) or (ii), and (B) has, (i)
prior experience as an independent director for a corporation or limited liability company whose
charter documents required the unanimous consent of all independent directors thereof before such
corporation or limited liability company could consent to the institution of bankruptcy or
insolvency proceedings against it or could file a petition seeking relief under any applicable
federal or state law relating to bankruptcy and (ii) at least three years of employment experience
with one or more entities that provide, in the ordinary course of their respective businesses,
advisory, management or placement services to issuers of securitization or structured finance
instruments, agreements or securities. The initial Independent Director of the Borrower set forth
in the Borrower’s operating agreement as of the Closing Date is hereby approved by the
Administrative Agent.

     “Indorsement” has the meaning specified in Section 8-102(a)(11) of the UCC, and
“Indorsed” has a corresponding meaning.

     “Industry” means the industry of an Obligor as determined by reference to the Moody’s
industry classifications by the Manager; provided that if the Administrative Agent shall have
objected to such determination with respect to an Obligor by notice to the Manager and the
Borrower, such determination with respect to such Obligor shall be made by mutual agreement of the
Manager and the Administrative Agent (and, if not so determined, Loans of such Obligor shall not
constitute Eligible Loan Assets).

     “Ineligible Loan Asset” is defined in Section 2.4(c).

     “Insider” is defined in Section 101(31) of the Bankruptcy Code.

     “Insolvency Event” means with respect to a specified Person, (a) the filing of a
decree or order for relief by a court having jurisdiction in the premises in respect of such Person
or any substantial part of its property in an involuntary case under any applicable Insolvency Law
now or hereafter in effect, or appointing a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official for such Person or for any substantial part of its property, or
ordering the winding-up or liquidation of such Person’s affairs, and such decree or order shall
remain unstayed and in effect for a period of sixty (60)

17

 

consecutive days; or (b) the commencement by such Person of a voluntary case under any
applicable Insolvency Law now or hereafter in effect, or the consent by such Person to the entry of
an order for relief in an involuntary case under any such law, or the consent by such Person to the
appointment of or taking possession by a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official for such Person or for any substantial part of its property, or
the making by such Person of any general assignment for the benefit of creditors, or the failure by
such Person generally to pay its debts as such debts become due, or the taking of action by such
Person in furtherance of any of the foregoing.

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

     “Insolvency Proceeding” means any case, action or proceeding before any court or
Governmental Authority relating to an Insolvency Event.

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

     “Insurance Proceeds” means any amounts payable or any payments made, to the Borrower
or to the Manager on its behalf under any Insurance Policy.

     “Interest” means for each Accrual Period and each Advance outstanding during such
Accrual Period, the product of:

	 	 	 

	 

	 	IR x P x AD

                D

     where

	 	 	 	 	 	 	 

	 

	 	IR
	 	=
	 	the Interest Rate applicable to such Advance;
	 
	 	 	 	 	 	 
	 

	 	P
	 	=
	 	the principal amount of such Advance on the first day of such
Accrual Period, or if such Advance was first made during such Accrual Period,
the principal amount of such Advance on the day such Advance is made;
	 
	 	 	 	 	 	 
	 

	 	AD
	 	=
	 	the actual number of days in such Accrual Period, or if
such Advance was first made during such Accrual Period, the actual number of
days beginning on the day such Advance was first made (or, in the event an
Advance was converted from a Base Rate Advance to a LIBOR Rate Advance (or
vice versa), the day on which such Advance was converted) through the end of
such Accrual Period; and
	 
	 	 	 	 	 	 
	 

	 	D
	 	=
	 	360 or, in the case of Base Rate Advances, 365 or 366, as
applicable

provided, however, that (i) no provision of this Agreement shall require or permit
the collection of Interest in excess of the maximum permitted by Applicable Law and (ii) Interest
shall not be considered paid by any distribution if at any time such distribution is rescinded or
must otherwise be returned for any reason.

18

 

     “Interest Collections” means, (i) with respect to any Loan Asset or other Collateral,
all payments and collections attributable to interest or dividends on such Loan Asset, including
all scheduled payments of interest and payments of interest relating to principal prepayments, all
guaranty payments attributable to interest and proceeds of any liquidations, sales, dispositions or
securitizations attributable to interest on such Loan Asset or other Collateral, (ii) amendment
fees, late fees, waiver fees, prepayment fees or other amounts received in respect of Loan Assets
and (iii) any and all other Collections which do not constitute Principal Collections.

     “Interest Coverage Ratio” means, with respect to any Settlement Period, the percentage
equivalent of a fraction, calculated as of the Determination Date for such Settlement Period, (a)
the numerator of which is equal to the sum of (i) the aggregate Interest Collections for such
Settlement Period and the five Settlement Periods immediately preceding such Settlement Period
minus (ii) the aggregate amount payable pursuant to Sections 2.7(a)(i) through (iv)
or Sections 2.7(b)(i) through (iv), as applicable, hereunder on the related Payment
Date and the five immediately preceding Payment Dates and (b) the denominator of which is equal to
the aggregate amount payable pursuant to Section 2.7(a)(v) or Section 2.7(b)(v), as
applicable, hereunder on the related Payment Date and the five immediately preceding Payment Dates;
provided that (x) the amount determined under clause (i) above shall not include any
collections with respect to assets held by the Borrower prior to the Closing Date, but that do not
constitute Collateral on the Closing Date, (y) solely for purposes of calculating the Interest
Coverage Ratio in respect of the first five Settlement Periods ending after the Closing Date, the
amount determined under clause (ii) of this definition with respect to amounts payable pursuant to
Sections 2.7(a)(i), (ii) or (iv) or Sections 2.7(b)(i),
(ii) or (iv), as applicable, shall be calculated from the Closing Date to the end
of the related Settlement Period (the “Interim Period”) and semi-annualized by multiplying
the actual amount paid pursuant to such sections on the relevant Payment Date(s) during the
applicable Interim Period by a fraction the numerator of which is 180 and the denominator of which
is the actual number of days from the Closing Date ended prior to the relevant Determination Date
to reach an assumed trailing six Settlement Period amount and (z) solely for purposes of
calculating the Interest Coverage Ratio in respect of the first five Settlement Periods ending
after the Closing Date, the amount determined under clause (ii) of this definition with respect to
amounts payable pursuant to Section 2.7(a)(iii) or Section 2.7(b)(iii), as
applicable shall be deemed to be $1,250,000.

     “Interest Rate” means, for each Accrual Period and for each Advance outstanding for
each day during such Accrual Period, a rate equal to the LIBOR Rate or the Base Rate as selected by
the Borrower for such Advance plus the Applicable Margin; provided, that, (i) the Interest Rate
shall be the Base Rate plus the Applicable Margin if a Lender shall have notified the
Administrative Agent that a Eurodollar Disruption Event has occurred; and (ii) the Interest Rate
shall, at the election of the Required Lenders, be the sum of the Base Rate plus the Applicable
Margin plus 2.0% for each day during any Accrual Period following the occurrence and during the
continuance of an Event of Default.

     “Interest Rate Hedge Transaction” means each interest rate cap transaction or
comparable derivative arrangements, in each case, as the Administrative Agent may approve in its
discretion between the Borrower and a Hedge Counterparty that is entered into pursuant to
Section 5.2(a) and is governed by an Hedging Agreement.

     “Interim Test” means a test that is satisfied on any date of determination occurring
prior to the nine month anniversary of the Closing Date if the Adjusted Borrowing Value in respect
of the GFSI Loan is less than 10% of the sum of (i) Aggregate Adjusted Borrowing Value of all
Eligible Loan Assets at such date of determination plus (ii) the Fair Value of all other
Overcollateralization Assets (expressed as a principal amount).

19

 

     “Investment Guidelines” means, with respect to the Borrower and the Manager, those
credit and collection policies existing as of the date hereof relating to the Loan Assets and
related Loan Asset Documents, as amended from time to time by the investment committee of the
Manager with the consent of the Administrative Agent.

     “Key Person” means any of the persons specified on Schedule VIII and any
replacement person reasonably satisfactory to the Administrative Agent.

     “Lenders” is defined in the preamble hereto.

     “LIBOR Rate” means, with respect to any LIBOR Rate Advance, the greater of (a) a rate
per annum equal to (i) the offered rate for deposits in Dollars having a one-month maturity and for
the amount of the applicable LIBOR Rate Advance that appears on the Reuters Screen LIBOR01 Page at
11:00 a.m. London time (or, if not so appearing, as published in the “Money Rates” section of
The Wall Street Journal or another national publication selected by the Administrative
Agent) two Business Days prior to the applicable Funding Date, divided by (ii) the sum of one minus
the daily average of the aggregate maximum reserve requirement (expressed as a decimal) then
imposed under Regulation D of the FRB for “Eurocurrency Liabilities” (as defined therein), and (b)
2.00%. The LIBOR Rate for any LIBOR Rate Advance outstanding on any Payment Date shall be
redetermined as of such Payment Date.

     “LIBOR Rate Advance” means any Advance which bears interest at or by reference to the
LIBOR Rate.

     “Lien” means any mortgage or deed of trust, pledge, hypothecation, collateral
assignment, deposit arrangement, encumbrance, lien (statutory or other), charge, claim, preference,
priority or other security interest or preferential arrangement in the nature of a security
interest of any kind or nature whatsoever (including any conditional sale, lease or other title
retention agreement, sale subject to a repurchase obligation, any easement, right of way or other
encumbrance on title to real property, and any financing lease having substantially the same
economic effect as any of the foregoing) or the filing of or agreement to give any financing
statement perfecting a security interest under the UCC or comparable law of any jurisdiction.

     “Liquidation Expenses” means with respect to any Defaulted Loan Asset, the aggregate
amount of out-of-pocket expenses reasonably incurred by the Borrower or on behalf of the Borrower
by the Manager (including amounts paid to any subservicer but net of any amounts reimbursed by the
related Obligor or otherwise pursuant to the Loan Asset Documents) in connection with the
repossession, refurbishing and disposition of any related assets securing such Loan Asset including
the attempted collection of any amount owing pursuant to such Loan Asset.

     “Liquid Loan Asset” means a Loan Asset that qualifies for Level 1 accounting treatment
pursuant to FASB Accounting Standards Codification 820 (formerly SFAS No. 157) for establishing
fair market value of assets.

     “Loan Asset” means any senior or subordinate loan or security arising from the
extension of credit to an Obligor.

     “Loan Asset Checklist” means, with respect to any Loan Asset, the index prepared by
the Manager identifying the type of Loan Asset (including whether such Loan Asset is a Noteless
Loan Asset) and each of the Loan Asset Documents related thereto which are included in the related
Loan Asset File.

20

 

     “Loan Asset Documents” means, with respect to any Loan Asset, the related
documentation that has been delivered or should, consistent with the Investment Guidelines and the
Management Standards, have been delivered to the Borrower or the Manager, including any related
instrument, promissory note, loan agreement, security agreement, mortgage, assignment of
collateral, all guarantees, and UCC financing statements and continuation statements (including
amendments or modifications thereof) executed by the Obligor thereof or by another Person on the
Obligor’s behalf in respect of such Loan Asset and related instrument, including general or limited
guaranties and, for each Loan Asset secured by real property an Assignment of Mortgage.

     “Loan Asset File” means, with respect to any Loan Asset, each of the Loan Asset
Documents related thereto.

     “Loan Asset Records” means all documents, books, records and other information
(including computer programs, tapes, disks, data processing software and related property rights)
prepared and maintained by the Manager with respect to the Loan Assets and the related Obligors.

     “Loan-to-Value Ratio” means, with respect to any Loan Asset at any date of
determination, the percentage equivalent of a fraction, (i) the numerator of which is equal to the
commitment amount as provided in the applicable Loan Asset Documents of such Loan Asset plus the
commitment amount of any other senior or pari passu Indebtedness of the related Obligor (including,
in the case of Delayed Funding Loan Assets, without duplication, the maximum availability thereof)
and (ii) the denominator of which is equal to the enterprise value of the Related Property securing
such Loan Asset (as determined by the Manager in accordance with the Investment Guidelines and the
Management Standards unless the Administrative Agent in its reasonable discretion disagrees with
such determination, in which case the Administrative Agent shall determine the enterprise value of
the Related Property). In the event the Borrower disagrees with the Administrative Agent’s
determination of the enterprise value of the Related Property, the Borrower may (at its expense)
retain any nationally recognized valuation firm reasonably acceptable to the Administrative Agent
to value such Related Property, and if the value determined by such firm is greater than the
Administrative Agent’s determination of the enterprise value of the Related Property, such firm’s
valuation shall become the enterprise value of such Related Property; provided that the
enterprise value of such Related Property shall be the value assigned by the Administrative Agent
until such firm has determined its value).

     “Maintenance Covenant” means a covenant by the Obligor to comply with one or more
financial covenants during each reporting period, whether or not it has taken any specified action.

     “Manager” means Saratoga Investment Advisors, LLC, a Delaware limited liability
company, and its permitted successors and assigns.

     “Manager’s Certificate” is defined in Section 7.10(a)(iv).

     “Manager Event” means the occurrence of any of the following (i) the Specified Holders
shall collectively cease to, directly or indirectly, (x) own and control at least 51% of the
outstanding equity interests of the Manager, or (y) possess the right to elect (through contract,
ownership of voting securities or otherwise) at all times a majority of the board of directors (or
similar governing body) of the Manager and to direct the management policies and decisions of the
Manager, (ii) the dissolution, termination or liquidation in whole or in part, transfer or other
disposition, in each case, of all or substantially all of the assets of, the Manager, (iii) at any
time prior to the third anniversary of the Closing Date, the Specified Holders cease to maintain
collectively, directly or indirectly, a cash equity investment in GSC Investment in an amount equal
to at least $5,000,000, (iv) the Management Agreement shall fail to be in full force and effect,
(v) the indictment or conviction of the Manager or any Key Person for a felony offense, or any

21

 

act of fraud, embezzlement or misappropriation of funds by the Manager or any Key Person and,
with respect to any such act by, or indictment or conviction of, any Key Person, a reputable,
experienced individual reasonably satisfactory to the Administrative Agent has not been appointed
to replace such Key Person within 30 days of such event, (vi) the resignation, termination,
disability or death of a Key Person, or any failure of any Key Person to provide active
participation in the Manager’s daily activities including, but not limited to, the activities
specified opposite such Key Person’s name on Schedule VIII, and a reputable, experienced individual
reasonably satisfactory to the Administrative Agent has not been appointed to replace such Key
Person within 30 days of such event, (vii) the occurrence of any event constituting “cause” under
the CLO Management Agreement, any notice is delivered under Section 12(c) of the CLO Management
Agreement with respect to the removal of GSC Investment as collateral manager thereunder or GSC
Investment ceases to act as collateral manager thereunder, (viii) the Manager shall willfully
violate, or take any action that it knows breaches, any material provision of this Agreement or any
other Transaction Document applicable to it; (ix) any failure by the Manager to give instructions
or notice to the Borrower or the Administrative Agent as required by this Agreement, or failure by
the Borrower or the Manager to deliver any Required Reports hereunder, in each case on or before
the date occurring three (3) Business Days after the date such instructions, notice or report is
required to be made or given, as the case may be, under the terms of this Agreement, or (x) the
occurrence of an Event of Default under Section 8.1 with respect to the Manager.

     “Management Agreement” means the Investment Advisory and Management Agreement, dated
as of July 30, 2010, between the Manager and GSC Investment, as amended, restated, supplemented or
otherwise modified from time to time.

     “Management Fee” means, for each Payment Date, (i) if the most recently ended calendar
month is the first month in a fiscal quarter of the Borrower, an amount equal to one-twelfth of the
product of 1.75% and the average of the Gross Asset Values as of the beginning and end of such
month, (ii) if the most recently ended calendar month is the second month in a fiscal quarter of
the Borrower, an amount which, when aggregated with the Management Fee for the immediately
preceding Payment Date, equals one-sixth of the product of 1.75% and the average of the Gross Asset
Values as of the beginning of such fiscal quarter and as of the end of such second month or (iii)
if the most recently ended calendar month is the third month in a fiscal quarter of the Borrower,
an amount which, when aggregated with the Management Fee for the two immediately preceding Payment
Dates, equals one-fourth of the product of 1.75% and the average of the Gross Asset Values as of
the beginning of such fiscal quarter and as of the end of such third month.

     “Management Standards” means the collection, management and servicing procedures the
Manager follows with respect to assets comparable to the Loan Assets that it manages for itself,
its Affiliates or others, which shall be procedures that the Manager reasonably believes to be
consistent with the procedures used by institutional managers of national standing of comparable
assets.

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

     “Material Adverse Effect” means with respect to any event or circumstance, means a
material adverse effect on (a) the business, condition (financial or otherwise), operations,
prospects, performance or properties of the Manager, the Performance Guarantor or the Borrower, (b)
the validity, enforceability or collectibility of this Agreement or any other Transaction Document
or the validity, enforceability or collectibility of the Loan Assets, (c) the rights and remedies
of the Administrative Agent, the Custodian or any Secured Party under this Agreement or any
Transaction Document or (d) the ability of the Borrower, the Performance Guarantor or the Manager
to perform its obligations under this Agreement or any other

22

 

Transaction Document, or (e) the status, existence, perfection, priority, or enforceability of
the Administrative Agent’s or Secured Parties’ interest in the Collateral.

     “Material Modification” means any amendment or waiver of, or modification or
supplement to, a Loan Asset Document governing a Loan Asset executed or effected on or after the
Purchase Date for such Loan Asset (or, solely in the case of clause (d)(ii)(y), a change to
any loan senior to a Loan Asset) which:

(a) reduces or forgives any or all of the principal amount due under such Loan Asset;

(b) delays or extends the required or scheduled amortization or maturity of such Loan Asset;

(c) waives one or more interest payments, permits any interest due in cash to be deferred or
capitalized and added to the principal amount of such Loan Asset (other than any deferral or
capitalization already allowed by the terms of the Loan Asset Documents of any PIK Loan
Asset), or reduces the spread or coupon with respect to such Loan Asset;

(d) (i) in the case of a Senior Secured Loan, Secured Bond, Hybrid Secured Bond, Unitranche
Loan or DIP Loan, contractually or structurally subordinates such Loan Asset by operation of
a priority of payments, turnover provisions, the transfer of assets in order to limit
recourse to the related Obligor or the granting of Liens (other than “permitted liens” as
defined in the applicable Loan Asset Documents for such Loan Asset or such comparable
definition if “permitted liens” is not defined therein, so long as such definition is
reasonable and customary and other than, in the case of the Hybrid Secured Bond, other Liens
permitted by the definition thereof) on any of the Related Property securing such Loan Asset
or (ii) in the case of a Second Lien Loan, Unsecured Bond or Mezzanine Loan, (x)
contractually or structurally subordinates such Loan Asset to any obligation (other than any
loan which existed at the Purchase Date for such Loan Asset which is senior to such Loan
Asset) by operation of a priority of payments, turnover provisions, the transfer of assets
in order to limit recourse to the related Obligor or the granting of Liens (other than
“permitted liens” as defined in the applicable Loan Asset Documents for such Loan Asset or
such comparable definition if “permitted liens” is not defined therein, so long as such
definition is reasonable and customary) on any of the Related Property securing such Loan
Asset or (y) increases the commitment amount of any loan senior to such Loan Asset;

(e) substitutes, alters or releases the Related Property securing such Loan Asset and each
such substitution, alteration or release, as determined in the sole reasonable discretion of
the Administrative Agent, materially and adversely affects the value of such Loan Asset; or

(f) amends, waives, forbears, supplements or otherwise modifies (i) the meaning of “Net
Leverage Ratio”, “Interest Coverage Ratio”, “EBITDA” or “Permitted Liens” or any respective
comparable definitions in the Loan Asset Documents for such Loan Asset or (ii) any term or
provision of such Loan Asset Documents referenced in or utilized in the calculation of the
“Net Leverage Ratio”, “Interest Coverage Ratio” or “Permitted Liens” or any respective
comparable definitions for such Loan Asset, in each case in a manner that, in the sole
reasonable judgment of the Administrative Agent, is materially adverse to the Secured
Parties..

     “Maturity Date” means the date that is five years after the Termination Date. The
Advances Outstanding will be due and payable in full on the Maturity Date.

     “Maximum Lawful Rate” is defined in Section 2.6(d).

23

 

     “Mezzanine Loan” means any assignment of or participation interest or other interest
in a loan that is of a rank lower than a Senior Secured Loan, Secured Bond, DIP Loan or Second Lien
Loan.

     “Monthly Report” is defined in Section 7.10(a)(iii).

     “Moody’s” means Moody’s Investors Service, Inc., and any successor thereto.

     “Multiemployer Plan” means a “multiemployer plan” as defined in Section 4001(a)(3) of
ERISA that is or was at any time during the current year or the immediately preceding five years
contributed to by the Borrower or any ERISA Affiliate on behalf of its employees.

     “Non-USD Notional Amount” is defined in Section 5.2(b).

     “Non-USD Loan Asset” means each Loan Asset which is denominated in an Approved Foreign
Currency.

     “Noteless Loan Asset” means a Loan Asset with respect to which the underlying Loan
Asset Documents either (i) do not require the Obligor to execute and deliver a promissory note to
evidence the indebtedness created under such Loan Asset or (ii) require execution and delivery of
such a promissory note only upon the request of any holder of the indebtedness created under such
Loan Asset, and as to which the Borrower has not requested a promissory note.

     “Notes” is defined in Section 2.5(a).

     “Obligor” means with respect to any Loan Asset, the Person or Persons obligated to
make payments pursuant to such Loan Asset, including any guarantor thereof. For purposes of
calculating the Excess Concentration Amount, all Loan Assets included in the Collateral or to
become part of the Collateral the Obligor of which is an Affiliate of another Obligor shall be
aggregated with all Loan Assets of such other Obligor.

     “Obligor Net Leverage Ratio” means, with respect to any Loan Asset for any Relevant
Test Period, the meaning of “Net Leverage Ratio” or any comparable definition in the Loan Asset
Documents for each such Loan Asset, and in any case that “Net Leverage Ratio” or such comparable
definition is not defined in such Loan Asset Documents, the ratio of (a) indebtedness of such
Obligor minus unrestricted cash to (b) EBITDA.

     “Operating Expenses” means, without duplication, (i) all amounts payable by GSC
Investment under that certain Administration Agreement dated as of July 30, 2010 between GSC
Investment and Saratoga Administrator LLC, a Delaware limited liability company, or any replacement
thereof, and (ii) all professional fees, insurance premiums and fees, director’s fees and other
general and administrative expenses of GSC Investment.

     “Opinion of Counsel” means a written opinion of counsel, who may be counsel for the
Borrower or the Manager, as the case may be, and who shall be reasonably acceptable to the
Administrative Agent.

     “Overcollateralization Assets” means all Loan Assets included in the Collateral (other
than Loan Assets that do not satisfy the requirements contained in any of clauses (vii), (viii),
(xxi), (xxii), (xxiii), (xxiv), (xxv), (xxvi) or (xxix) of the definition of Eligible Loan Assets
(regardless of whether such Loan Assets are included in the Borrowing Base) and the CLO Equity.

24

 

     “Overcollateralization Ratio” means, with respect to any Settlement Period, the
percentage equivalent of a fraction, calculated as of the Determination Date for such Settlement
Period, (a) the numerator of which is equal to the sum of (i) the Aggregate Adjusted Borrowing
Value of all Eligible Loan Assets at such date of determination (except if the Adjusted Borrowing
Value of an Eligible Loan Asset is zero as a result of the application of clause (c) of the
definition of Assigned Value, then such Eligible Loan Asset shall instead be valued at its Fair
Value for purposes of this clause (i)) plus (ii) the Fair Value of all other
Overcollateralization Assets and (b) the denominator of which is equal to the sum of Advances
Outstanding on such date plus the Unfunded Exposure Amount on such date.

     “Other Costs” is defined in Section 12.8.

     “Outstanding Principal Balance” means, on any date of determination with respect to
any Loan Asset, the outstanding principal balance (net of any unamortized discount or upfront fee)
of a Loan Asset, expressed exclusive of PIK Interest and accrued interest; provided that
amortization payments on a Loan Asset shall first be applied to PIK Interest when determining the
Outstanding Principal Balance of such Loan Asset.

     “Participant” is defined in Section 11.1(b).

     “Payment Date” means the tenth (10th) day of each calendar month,
commencing in September 2010, or, if such day is not a Business Day, the next succeeding Business
Day.

     “Performance Guarantor” is defined in the preamble hereto.

     “Permitted Investments” means any one or more of the following types of investments:

     (a) marketable obligations of the United States, the full and timely payment of which are
backed by the full faith and credit of the United States and that have a maturity of not more than
270 days from the date of acquisition;

     (b) marketable obligations, the full and timely payment of which are directly and fully
guaranteed by the full faith and credit of the United States and that have a maturity of not more
than 270 days from the date of acquisition;

     (c) bankers’ acceptances and certificates of deposit and other interest-bearing obligations
(in each case having a maturity of not more than 270 days from the date of acquisition) denominated
in dollars and issued by any bank with capital, surplus and undivided profits aggregating at least
$100,000,000, the short-term obligations of which are rated A-1 by S&P and P-1 by Moody’s;

     (d) repurchase obligations with a term of not more than ten (10) days for underlying
securities of the types described in clauses (a), (b) and (c) above entered into with any bank of
the type described in clause (c) above;

     (e) commercial paper rated at least A-1 by S&P and P-1 by Moody’s; and

     (f) demand deposits, time deposits or certificates of deposit (having original maturities of
no more than 365 days) of depository institutions or trust companies incorporated under the laws of
the United States or any state thereof (or domestic branches of any foreign bank) and subject to
supervision and examination by federal or state banking or depository institution authorities;
provided, however that at the time such investment, or the commitment to make such investment, is
entered into, the short-term

25

 

debt rating of such depository institution or trust company shall be at least A-1 by S&P and
P-1 by Moody’s.

     “Permitted Liens” means any of the following as to which no enforcement, collection,
execution, levy or foreclosure proceeding shall have been commenced (a) Liens for state, municipal
or other local Taxes if such Taxes shall not at the time be due and payable or if a Person shall
currently be contesting the validity thereof in good faith by appropriate proceedings and with
respect to which reserves in accordance with GAAP have been provided on the books of such Person,
(b) Liens imposed by law, such as materialmen’s, warehousemen’s, mechanics’, carriers’, workmen’s
and repairmen’s Liens and other similar Liens, arising by operation of law in the ordinary course
of business for sums that are not overdue or are being contested in good faith and (c) Liens
granted pursuant to or by the Transaction Documents.

     “Person” means an individual, partnership, corporation (including a statutory trust),
limited liability company, joint stock company, trust, unincorporated association, sole
proprietorship, joint venture, government (or any agency or political subdivision thereof) or other
entity.

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

     “PIK Loan Asset” means a Loan Asset that, as of the date of determination, by its
terms, permits the payment of a fixed or floating rate of interest through the issuance of
additional debt securities identical to such debt security or through additions to the principal
amount thereof for a specified period to time prior to such Loan Asset requiring the current cash
payment of such previously capitalized interest, which cash payment shall be treated as an Interest
Collection at the time it is received.

     “Prepayment Fee” means (i) to the extent the Prepayment Fee is required to be paid
pursuant to this Agreement on or prior to the date which is one year following the Closing Date,
2.00% of the Facility Amount or the amount by which the Facility Amount is reduced, as applicable,
and (ii) to the extent the Prepayment Fee is required to be paid pursuant to this Agreement on or
prior to the date which is two years following the Closing Date but after the first anniversary of
the Closing Date, 1.00% of the Facility Amount or the amount by which the Facility Amount is
reduced, as applicable; provided that, in the foregoing clauses (i) and (ii), the
Prepayment Fee shall be calculated without giving effect to the proviso in the definition of
“Facility Amount”.

     “Priced Loan Asset” means any Loan Asset that has an observable quote from LoanX
Mark-It Partners or Loan Pricing Corporation, or from another pricing service selected by the
Administrative Agent in its sole discretion.

     “Principal Balance” means, with respect to any Loan Asset (other than a Delayed
Funding Loan Asset), as of any date of determination, the outstanding principal amount of such Loan
Asset, and in the case of any Delayed Funding Loan Asset, the aggregate commitment amount thereof.

     “Principal Collections” means (i) any and all amounts received in respect of any
principal due and payable under any Loan Asset or other Collateral from or on behalf of Obligors
that are deposited into the Collection Account, or received by the Borrower or on behalf of the
Borrower by the Manager or Performance Guarantor in respect of the Loan Assets or other Collateral,
including all Recoveries, all scheduled payments of principal and principal prepayments and all
guaranty payments and proceeds of any liquidations, sales, dispositions or securitizations, in each
case, attributable to the principal of such Loan Asset, (ii) all payments received pursuant to any
Hedging Agreement or Hedge Transaction and (iii) all payments received in respect of principal in
respect of the CLO Equity. For the avoidance of doubt,

26

 

“Principal Collections” shall not include amounts on deposit in the Unfunded Exposure Account
or amounts withdrawn pursuant to Section 2.7(e).

     “Prior Credit Agreement” means the Credit Agreement, dated as of April 11, 2007, among
the Borrower, GSC Investment, GSCP (NJ), L.P., the financial institutions from time to time party
thereto, the commercial paper lenders from time to time party thereto, Deutsche Bank AG, New York
Branch, and U.S. Bank National Association, as trustee and backup servicer.

     “Proceeds” means with respect to any Collateral, whatever is receivable or received
when such Collateral is sold, collected, liquidated, foreclosed, exchanged, or otherwise disposed
of, whether such disposition is voluntary or involuntary, including all rights to payment with
respect to any insurance relating to such Collateral.

     “Pro Rata Share” means with respect to any Lender on any day, the percentage
equivalent of a fraction the numerator of which is such Lender’s Commitment and the denominator of
which is Commitments of all Lenders.

     “Purchase Agreement” means the Amended and Restated Purchase and Sale Agreement dated
as of the Closing Date, between GSC Investment, in its capacity as originator, and the Borrower, as
amended, modified, supplemented or restated from time to time.

     “Purchase Date” means the date on which a Loan Asset is acquired or originated by the
Borrower.

     “Purchase Price” means the net price paid by the Borrower in purchasing a Loan Asset,
taking into account upfront fees or any other costs or fees paid or received.

     “Qualified Institution” is defined in Section 5.3(a).

     “Records” means with respect to any Loan Assets, all documents, books, records and
other information (including without limitation, computer programs, tapes, disks, punch cards, data
processing software and related property and rights) maintained with respect to any item of
Collateral and the related Obligors, other than the Loan Asset Documents.

     “Recoveries” means with respect to any Defaulted Loan Asset, Proceeds of the sale of
any Related Property, Insurance Proceeds, and any other recoveries with respect to such Loan Asset
and Related Property, and amounts representing late fees and penalties, net of Liquidation Expenses
and amounts, if any, received that are required to be refunded to the Obligor on such Loan Asset.

     “Relevant Test Period” means, with respect to any Loan Asset, the relevant test period
for the calculation of Obligor Net Leverage Ratio for such Loan Asset in the Loan Asset Documents
or, if no such period is provided for therein, for Obligors delivering monthly financing
statements, each period of the last 12 consecutive reported calendar months, and for Obligors
delivering quarterly financing statements, each period of the last four consecutive reported fiscal
quarters of the principal Obligor on such Loan Asset; provided that with respect to any Loan Asset
for which the relevant test period is not provided for in the Loan Asset Documents, if an Obligor
is a newly-formed entity as to which 12 consecutive calendar months have not yet elapsed, “Relevant
Test Period” shall initially include the period from the date of formation of such Obligor to the
end of the twelfth calendar month or fourth fiscal quarter (as the case may be) from the date of
formation, and shall subsequently include each period of the last 12 consecutive reported calendar
months or four consecutive reported fiscal quarters (as the case may be) of such Obligor.

27

 

     “Repayment Obligation” is defined in Section 12.14.

     “Regulatory Change” is defined in Section 2.11(a).

     “Related Property” means with respect to a Loan Asset, any property or other assets of
the Obligor thereunder pledged as collateral to secure the repayment of such Loan Asset.

     “Reporting Date” means the date that is three (3) Business Days prior to each Payment
Date.

     “Required Lenders” means at a particular time, Lenders with Commitments in excess of
50% of the Facility Amount, provided, that at any time there are not more than two (2) unaffiliated
Lenders party hereto, “Required Lenders” shall mean Lenders with Commitments equal to 100%
of the Facility Amount.

     “Required Reports” means collectively, the Monthly Report, the Manager’s Certificate,
the annual and quarterly financial statements of the Performance Guarantor, the financial
statements and valuation reports of each Obligor, the annual statements as to compliance, and the
annual independent public accountant’s report, in each case required to be delivered pursuant to
Section 7.10.

     “Reserve Account” means an account established in accordance with Section
5.3(d) for the purpose of receiving deposits with respect to, and maintaining therein, the
Reserve Account Required Amount (including any amounts in excess of the Reserve Account Required
Amount, to the extent not distributed to the parties entitled thereto pursuant to Section
2.7) and, to the extent required pursuant to Section 2.7, to fund payments thereunder.

     “Reserve Account Required Amount” means an amount payable on each Payment Date, as
determined on the related Determination Date, equal to the sum of the Interest, the Commitment Fee
and the Administrative Agent Fee, each as estimated by the Manager in good faith to be due and
payable on the next succeeding three Payment Dates or, if, as of any date of determination, the
aggregate amount of the Adjusted Borrowing Values of all Loan Assets which do not pay cash interest
at least quarterly exceeds 15% of the Aggregate Adjusted Borrowing Value, the next succeeding six
Payment Dates.

     “Responsible Officer” means as to the Borrower, the President, any Vice President or
the Treasurer of the Borrower, and as to any other Person, any officer of such Person with direct
responsibility for the administration of this Agreement and also, with respect to a particular
matter, any other officer to whom such matter is referred because of such officer’s knowledge of
and familiarity with the particular subject. The Borrower may designate other Responsible Officers
from time to time by notice to the Administrative Agent.

     “Revolving Period” means the period commencing on the Closing Date and ending on the
day immediately preceding the Termination Date.

     “S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill
Companies, Inc. and any successor thereto.

     “Schedule of Loan Assets” means the Loan Assets listed on Schedule III hereto
(including the CLO Equity and all Supplemental Interests), which Schedule shall include the
information thereon and the following items:

(a) the Obligor;

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(b) the CUSIP, if any;

(c) the jurisdiction of organization or incorporation of the issuer;

(d) the Purchase Price (including a break out of any purchased accrued interest);

(e) whether such Loan Asset is a Delayed Funding Loan Asset and the maximum commitment
amount thereof;

(f) the interest rate (expressed as a fixed rate for Fixed Rate Loan Assets and expressed as
a spread over LIBOR or other applicable index for Floating Rate Loan Assets);

(g) the Principal Balance;

(h) the Stated Maturity;

(i) the Industry;

(j) the Adjusted Borrowing Value; and

(k) in the case of the Closing Date Loan Assets, the Applicable Advance Rate,

as amended from time to time to reflect the release of Loan Assets or the inclusion of Loan Assets
as provided in this Agreement.

     “Scheduled Payment” means on any Determination Date, with respect to any Loan Asset,
each scheduled payment (whether principal, interest or principal and interest) required to be made
by the Obligor thereof after such Determination Date under the terms of such Loan Asset.

     “SEC” means the United States Securities and Exchange Commission.

     “Second Lien Loan” means a secured loan (i) means any Loan Asset that (i) is secured
by a valid and perfected second priority security interest on all of the Obligor’s assets
constituting Related Property for the Loan Asset (whether or not there is also a security interest
of a higher or lower priority in additional collateral), subject to any “permitted liens” as
defined in the applicable Loan Asset Documents for such Loan Asset or such comparable definition if
“permitted liens” is not defined therein, so long as such definition is reasonable and customary;
(ii) with respect to priority of payment obligations is pari passu with the indebtedness of the
holder with the first priority security interest except after an event of default thereunder; (iii)
pursuant to an intercreditor agreement between the Borrower and the holder(s) of such first
priority security interest, the amount of the indebtedness covered by such first priority security
interest is limited (in terms of aggregate dollar amount or percent of outstanding principal or
both); and (iv) with respect to which the value of the collateral securing such secured loan,
together with other attributes of the Obligor (including its general financial condition, ability
to generate cash flow available for debt service and other demands for that cash flow) is adequate
(in the sole, reasonable business judgment of the Manager, which judgment shall not be called into
question as a result of subsequent events) to repay such secured loan in accordance with its terms,
and to repay all other loans of equal or higher seniority secured by a first or second lien or
security interest in the same collateral.

     “Secured Bond” means a secured bond (i) that is not (and cannot by its terms become)
subordinated in right of payment by its terms to unsecured indebtedness of the Obligor for borrowed
money (other than with respect to liquidation, trade claims, capitalized leases or other similar
obligations)

29

 

and the lien of which is not subordinated to any other secured obligation of the Obligor
secured by all or a portion of the collateral securing such secured loan; (ii) is secured by a
valid and perfected first priority Lien on all of the Obligor’s assets constituting Related
Property for the Loan Asset, subject to any “permitted liens” as defined in the applicable Loan
Asset Documents for such Loan Asset or such comparable definition if “permitted liens” is not
defined therein, so long as such definition is reasonable and customary; (iii) as of the date such
Loan Asset is initially included in the Collateral, has a Loan-to-Value Ratio not greater than 55%
and with respect to which the Obligor Net Leverage Ratio is less than 4.0 to 1.0; and (iv) that is
not secured solely or primarily by the common stock or other equity interests of its Obligor or any
of its affiliates.

     “Secured Party” means (i) each Lender, (ii) the Administrative Agent and (iii) each
Hedge Counterparty that is either a Lender or an Affiliate of a Lender if that Affiliate executes a
counterpart of this Agreement agreeing to be bound by the terms of this Agreement applicable to a
Secured Party.

     “Senior Secured Loan” means a secured loan (i) that is not (and cannot by its terms
become) subordinated in right of payment by its terms to unsecured indebtedness of the Obligor for
borrowed money (other than with respect to liquidation, trade claims, capitalized leases or other
similar obligations) and the lien of which is not subordinated to any other secured obligation of
the Obligor secured by all or a portion of the collateral securing such secured loan; (ii) is
secured by a valid and perfected first priority Lien on all of the Obligor’s assets constituting
Related Property for the Loan Asset, subject to any “permitted liens” as defined in the applicable
Loan Asset Documents for such Loan Asset or such comparable definition if “permitted liens” is not
defined therein, so long as such definition is reasonable and customary; (iii) as of the date such
Loan Asset is initially included in the Collateral, has a Loan-to-Value Ratio not greater than 55%
and with respect to which the Obligor Net Leverage Ratio is less than 4.0 to 1.0; and (iv) that is
not secured solely or primarily by the common stock or other equity interests of its Obligor or any
of its affiliates.

     “Settlement Period” means each calendar month, or, with respect to the initial
Settlement Period, the period from the Closing Date to August 31, 2010.

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

     “Specified Holders” means any of the persons specified on Schedule IX.

     “Stated Maturity” means, with respect to any Loan Asset, the maturity date specified
with respect to such loan or security (subject to any business day convention specified under the
applicable Loan Asset Documents).

     “Subordination Event” is defined in Section 5.1(r).

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     “Substitute Loan Asset” means any Loan Asset which is substituted for an Ineligible
Loan Asset pursuant to Section 2.4(c), which satisfies each of the following conditions:
(a) the aggregate Adjusted Borrowing Value of such Loan Asset shall be equal to or greater than the
Adjusted Borrowing Value of the Loan Asset to be replaced; (b) all representations and warranties
of the Borrower with respect to such Loan Asset contained in Section 4.1(y) shall be true
and correct as of the Substitution Date of any such Substitute Loan Asset; (c) the substitution of
any Substitute Loan Asset does not cause a Default or an Event of Default to occur; and (d) as of
the date on which such Loan Asset becomes part of the Collateral, the Weighed Average FMV Test is
satisfied; provided that if immediately prior to such date, the Weighed Average FMV Test was not
satisfied, such test is maintained or improved after giving effect to the inclusion of such Loan
Asset in the Collateral.

     “Substitution Date” means any date on which the Borrower transfers a Substitute Loan
Asset to the Custodian.

     “Successor Manager” is defined in Section 7.9.

     “Supplemental Interests” means, with respect to any Loan Asset, any warrants, equity
or other equity interests or interests convertible into or exchangeable for any such interests
received from the Obligor in connection with such Loan Asset.

     “Taxes” means any present or future taxes, levies, imposts, duties, charges,
assessments or fees of any nature (including interest, penalties, and additions thereto) that are
imposed by any Governmental Authority.

     “Termination Date” means the earliest to occur of (a) the date declared by the
Administrative Agent or occurring automatically in respect of the occurrence of an Event of Default
pursuant to Section 8.2, (b) a date selected by the Borrower upon at least thirty (30)
days’ prior written notice to the Administrative Agent and (c) the Commitment Termination Date.

     “Transaction Documents” means this Agreement, the Purchase Agreement, all Hedging
Agreements, the Account Control Agreement, the CLO Management Contribution Agreement and any
additional document, letter, fee letter, certificate, opinion, agreement or writing the execution
of which is delivered in connection with the foregoing or otherwise necessary or incidental to
carrying out the terms of the foregoing documents.

     “UCC” means the Uniform Commercial Code as from time to time in effect in the
specified jurisdiction or, if no jurisdiction is specified, the State of New York.

     “Underlying Note” means the promissory note of an Obligor evidencing a Loan Asset.

     “Unfunded Exposure Account” means an account established in accordance with
Section 5.3(e) for the purposes of funding Unfunded Exposure Amounts; provided,
that the funds deposited therein (including any interest and earnings thereon) from time to time
shall constitute the property and assets of the Borrower and the Borrower shall be solely liable
for any Taxes payable with respect to the Unfunded Exposure Account.

     “Unfunded Exposure Amount” means, at any time, the amount, if any, by which (i) the
aggregate Exposure Amount exceeds (ii) the aggregate amount on deposit in the Unfunded Exposure
Account.

     “Unfunded Exposure Equity Amount” means, on any date of determination with respect to
any Delayed Funding Loan Asset, an amount equal to the sum of (a) the product of (i) the Exposure
Amount

31

 

of such Loan Asset times (ii) the difference of (A) 100% minus (B) the Applicable Advance Rate
plus (b) the product of (i) (x) the difference of (A) 100% minus (B) the Assigned Value of such
Loan Asset times (y) the Exposure Amount of such Loan Asset times (ii) the Applicable Advance Rate
of such Loan Asset.

     “United States” means The United States of America.

     “Unitranche Loan” means a secured loan or secured bond (i) that is not (and cannot by
its terms become) subordinated in right of payment by its terms to unsecured indebtedness of the
Obligor for borrowed money (other than with respect to liquidation, trade claims, capitalized
leases or other similar obligations) and the lien of which is not subordinated to any other secured
obligation of the Obligor secured by all or a portion of the collateral securing such secured loan;
(ii) is secured by a valid and perfected first priority Lien on all of the Obligor’s assets
constituting Related Property for the Loan Asset, subject to any “permitted liens” as defined in
the applicable Loan Asset Documents for such Loan Asset or such comparable definition if “permitted
liens” is not defined therein, so long as such definition is reasonable and customary; (iii) has a
Loan-to-Value Ratio equal to or greater than 55% as of the date such Loan Asset is initially
included in the Collateral or with respect to which the Obligor Net Leverage Ratio is equal to or
greater than 4.0 to 1.0; and (iv) that is not secured solely or primarily by the common stock or
other equity interests of its Obligor or any of its affiliates.

     “Unsecured Bond” means a debt obligation in the form of a bond that has ordinary,
unsecured pre-petition priority in any bankruptcy, reorganization, insolvency or liquidation
proceedings

     “U.S. Bank” means U.S. Bank National Association, or any permitted successor thereto.

     “USD Notional Amount” is defined in Section 5.2(b).

     “Value Adjustment Event” means, with respect to any Loan Asset, the occurrence of any
one or more of the following events after the related Purchase Date (or, in the case of the Closing
Date Loan Assets, the Closing Date):

     (i) the Fair Value of such Loan Asset has been reduced by the Borrower from the Fair Value of
such Loan Asset originally assigned thereto on the Closing Date (in the case of Closing Date Loan
Assets) or Purchase Date (in the case of Loan Assets acquired after the Closing Date);
provided that if such Loan Asset is identified as “Category 1” on Schedule VI
attached hereto or is acquired by the Borrower after the Closing Date, no such reduction to the
Fair Value of such Loan Asset shall be taken into account until the Fair Value has been reduced
more than 10 percentage points from the Fair Value originally assigned thereto on the Closing Date
or Purchase Date, as the case may be; it being understood and agreed that each reduction in Fair
Value after (or in excess of) the initial 10 percentage point reduction shall be taken into account
and constitute a Value Adjustment Event;

     (ii) except in the case of a Liquid Loan Asset or a Loan Asset identified as “Category 1” on
Schedule VI attached hereto, the Fair Value of such Loan Asset has been increased by the
Borrower from the Fair Value of such Loan Asset originally assigned thereto on the Closing Date (in
the case of Closing Date Loan Assets) or Purchase Date (in the case of Loan Assets acquired after
the Closing Date); provided that such increase in Fair Value shall only be treated as a Value
Adjustment Event with the written consent of the Administrative Agent, which consent may be
requested by the Borrower or the Manager only one (1) time per Loan Asset in any six (6) calendar
month period;

     (iii) if such Loan Asset is a Liquid Loan Asset, the Fair Value of such Loan Asset has been
increased by the Borrower from the Fair Value of such Loan Asset originally assigned thereto on the
related Purchase Date;

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     (iv) an Obligor payment default under any Loan Asset (after giving effect to any grace and/or
cure period set forth in the Loan Asset Documents, but not to exceed 10 days (in the case of a Loan
Asset other than a Secured Bond or Unsecured Bond) or 30 days (in the case of a Loan Asset
consisting of a Secured Bond or Unsecured Bond));

     (v) any other Obligor default under any Loan Asset for which the Borrower (or agent or
required lenders pursuant to the Loan Asset Documents, as applicable) has elected to accelerate the
indebtedness under, or exercise any of its rights and remedies against the collateral pursuant to,
the applicable Loan Asset Documents in case of the default thereunder;

     (vi) an Insolvency Event with respect to the related Obligor;

     (vii) the occurrence of a Material Modification (in accordance with clauses
(b)-(f) of the definition thereof) with respect to such Loan Asset; or

     (viii) the occurrence of a Material Modification (in accordance with clause (a) of the
definition thereof) with respect to such Loan Asset.

     “Weighted Average Portfolio FMV” means, as of any date of determination, the number
(calculated as a percentage) determined by summing the products obtained by multiplying (i) the
Borrowing Base Value of each Eligible Loan Asset as of such date by (ii) its Assigned Value
(provided that, for purposes of this definition, the Assigned Value with respect to each Closing
Date Loan Asset shall not exceed its Fair Value) as of such date, dividing such sum by the
Aggregate Borrowing Base Value for all Eligible Loan Assets and then rounding the result to the
nearest one-hundredth.

     “Weighted Average FMV Test” means, with respect to the Loan Assets included in the
Collateral, on any Determination Date, a test that is satisfied if the Weighted Average Portfolio
FMV is at least (i) 72% for any Determination Date occurring during the period from the Closing
Date to and including the first anniversary thereof, (ii) 80% for any Determination Date occurring
during the period from but excluding the first anniversary of the Closing Date to and including the
second anniversary thereof and (iii) 85% for any Determination Date thereafter.

Section 1.2 Other Terms.

     All accounting terms not specifically defined herein shall be construed in accordance with
GAAP. All terms used in Article 9 of the UCC in the State of New York, and not specifically defined
herein, are used herein as defined in such Article 9.

Section 1.3 Computation of Time Periods.

     Unless otherwise stated in this Agreement, in the computation of a period of time from a
specified date to a later specified date, the word “from” means “from and including” and the words
“to” and “until” each mean “to but excluding.”

Section 1.4 Interpretation.

     In each Transaction Document, unless a contrary intention appears:

     (i) the singular number includes the plural number and vice versa;

33

 

     (ii) reference to any Person includes such Person’s successors and assigns but, if
applicable, only if such successors and assigns are permitted by the Transaction Document;

     (iii) reference to any gender includes each other gender;

     (iv) reference to any agreement (including any Transaction Document), document or
instrument means such agreement, document or instrument as amended, supplemented or modified and
in effect from time to time in accordance with the terms thereof and, if applicable, the terms
of the other Transaction Documents and reference to any promissory note includes any promissory
note that is an extension or renewal thereof or a substitute or replacement therefor;

     (v) the term “including” shall mean “including without limitation”;

     (vi) reference to any Applicable Law means such Applicable Law as amended, modified,
codified, replaced or reenacted, in whole or in part, and in effect from time to time, including
rules and regulations promulgated thereunder and reference to any section or other provision of
any Applicable Law means that provision of such Applicable Law from time to time in effect and
constituting the substantive amendment, modification, codification, replacement or reenactment
of such section or other provision; and

     (vii) if the context requires in the calculation of any amount hereunder, such amount shall
be converted from a notional or dollar amount to a percentage or from a percentage to a notional
or dollar amount, as the case may be, in order for such calculation to be consistent with the
context in which such calculation is made or determined.

ARTICLE II

ADVANCES

Section 2.1 Advances.

     On the terms and conditions hereinafter set forth, the Borrower may, by delivery of a Funding
Request to the Administrative Agent, from time to time on any Business Day during the Revolving
Period, at its option, request that the Lenders make advances (each, an “Advance”) to it in
an amount which, at any time, shall not exceed the Availability in effect on the related Funding
Date. Such Funding Request shall be delivered not later than (a) in the case of a Base Rate
Advance, 12:00 noon (New York City time) on the requested Funding Date and (b) in the case of a
LIBOR Rate Advance, 12:00 noon (New York City time) at least three (3) Business Days prior to the
requested Funding Date (or such shorter period of time or later date as may be agreed to by the
Lenders). Subject to the terms and conditions hereof, upon receipt of such Funding Request, each
Lender shall from time to time during the Revolving Period, make the Advance. Notwithstanding
anything contained in this Section 2.1 or elsewhere in this Agreement to the contrary, no
Lender shall be obligated to make any Advance in an amount that would result in the aggregate
Advances then funded by such Lender exceeding its Commitment then in effect. The obligation of each
Lender to remit its Pro Rata Share of any such Advance shall be several from that of each other
Lender, and the failure of any Lender to so make such amount available to the Borrower shall not
relieve any other Lender of its obligation hereunder. Each Advance to be made hereunder shall be
made ratably among the Lenders in accordance with its Pro Rata Share.

Section 2.2 Procedures for Advances.

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     (a) In the case of the making of any Advance, the repayment of any Advance or any termination,
increase or reduction of the Facility Amount and prepayments of Advances, the Borrower shall give
the Administrative Agent a Borrower Notice. Each Borrower Notice shall specify the amount (subject
to Section 2.1 hereof) of Advances to be borrowed or repaid and the Funding Date or
repayment date (which, in all cases, shall be a Business Day). Each Advance shall be either a Base
Rate Advance or a LIBOR Rate Advance, as the Borrower shall specify in the related Borrower Notice
or, in the case of the conversion of an Advance into another type of Advance or the continuation of
a LIBOR Rate Advance, the related Conversion/Continuation Notice pursuant to this Section
2.2.

     (b) Subject to the conditions described in Section 2.1, the Borrower may request an
Advance from the Lenders by delivering to the Administrative Agent at certain times the information
and documents set forth in this Section 2.2.

     (c) No later than (a) in the case of a Base Rate Advance, 12:00 noon (New York City time) on
the requested Funding Date and (b) in the case of a LIBOR Rate Advance, 12:00 noon (New York City
time) at least three (3) Business Days prior to the requested Funding Date (or such shorter period
of time or later date as may be agreed to by the Required Lenders), the Administrative Agent and
the Custodian, as applicable, shall receive or shall have previously received the following:

     (i) a Funding Request in the form of Exhibit A; and

     (ii) a wire disbursement and authorization form.

     (d) Each Funding Request shall specify the aggregate amount of the requested Advance, which
shall be in an amount equal to at least $1,000,000. Each Funding Request shall be accompanied by
(i) a Borrower Notice, depicting the outstanding amount of Advances under this Agreement and
representing that all conditions precedent for a funding have been met, including a representation
by the Borrower that the requested Advance shall not, on the Funding Date thereof, exceed the
Availability on such day, (ii) a calculation of the Collateral Tests as of the date the Advance is
requested (giving pro forma effect to such Advance), (iii) an updated Schedule of Loan Assets
including each Loan Asset that is subject to the requested Advance, (iv) the proposed Funding Date,
(v) wire transfer instructions for the Advance and (vi) in the case of a Delayed Funding Loan
Asset, (A) a calculation of the Unfunded Exposure Amount with respect thereto and (B) the amount of
cash representing the Unfunded Exposure Equity Amount that will be funded by the Borrower into the
Unfunded Exposure Account in connection with the Advance, if applicable. A Funding Request shall
be irrevocable when delivered.

     (e) On the Funding Date following the satisfaction of the applicable conditions set forth in
this Section 2.2 and Article III, each Lender shall make available to the
Administrative Agent for deposit to the account of the Borrower or its designee in same day funds,
at the account specified in the Funding Request, an amount equal to such Lender’s ratable share of
the Advance then being made; provided that, with respect to an Advance relating to the acquisition
or funding of a Delayed Funding Loan Asset, the Administrative Agent shall remit the Advance equal
to the sum of the Unfunded Exposure Amount related to such Delayed Funding Loan Asset minus the
Unfunded Exposure Equity Amount related to such Delayed Funding Loan Asset funded by the Borrower
in same day funds to the Unfunded Exposure Account. Each wire transfer of an Advance to the
Borrower shall be initiated by the applicable Lender no later than 2:00 p.m. (New York city time)
on the applicable Funding Date.

     (f) The Borrower may, upon irrevocable written notice to the Administrative Agent in
accordance with clause (g) below, elect (i) as of any Business Day, to convert any Advances (or any
part thereof in an aggregate amount of not less than $100,000 or a higher integral multiple of
$50,000) into Advances of the other type or (ii) as of the last day of the applicable Accrual
Period, to continue any

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LIBOR Rate Advances (or any part thereof in an aggregate amount not less than $100,000 or a
higher integral multiple of $50,000) for a new Accrual Period; provided, that any conversion of a
LIBOR Rate Advance on a day other than the last day of a Accrual Period shall be subject to
Section 2.10. Absent written notice the contrary in accordance herewith, each LIBOR Rate
Advance shall continue for successive Accrual Periods.

     (g) The Borrower shall give written or telephonic notice (followed immediately by written
confirmation thereof) to the Administrative Agent of each proposed conversion or continuation not
later than (i) in the case of conversion into Base Rate Advances, 12:00 p.m. (New York city time)
on the proposed date of such conversion and (ii) in the case of conversion into or continuation of
LIBOR Rate Advances, 12:00 p.m. (New York city time) at least three Business Days prior to the
proposed date of such conversion or continuation, specifying in each case in the form of a
Conversion/Continuation Notice: (i) the proposed date of conversion or continuation; (ii) the
aggregate amount of Advances to be converted or continued; and (iii) the type of Advances resulting
from the proposed conversion or continuation.

     (h) The Administrative Agent will promptly notify each applicable Lender of its receipt of a
notice of conversion or continuation pursuant to this Section 2.2 or, if no timely notice
is provided by Borrower, of the details of any automatic conversion.

     (i) Notwithstanding any other provision of this Agreement, no Lender shall have an obligation
to make any LIBOR Rate Advance, or to permit the continuation of or any conversion into any LIBOR
Rate Advance, if an Event of Default or Default exists.

Section 2.3 Optional Changes in Facility Amount; Prepayments.

     (a) The Borrower shall be entitled at its option, at any time an Event of Default does not
exist, to reduce the Facility Amount in whole or in part; provided that the Borrower shall
give prior written notice of such reduction to the Administrative Agent and the Custodian as
provided in paragraph (b) of this Section 2.3 and that any partial reduction of the
Facility Amount shall be in an amount equal to $5,000,000 with integral multiples of $1,000,000
above such amount. Unless otherwise agreed by the Lenders, the Commitment of each Lender shall be
reduced ratably in proportion to such reduction in the Facility Amount. Any request for a
reduction or termination pursuant to this Section 2.3 shall be irrevocable. The Borrower
shall pay the Prepayment Fee in connection with such reduction or termination prior to the second
anniversary of the Closing Date.

     (b) The Borrower may, on not more than three (3) occasions during the period commencing on the
Closing Date and ending on the two-year anniversary of the Closing Date and upon not less than two
(2) Business Days prior written notice to the Administrative Agent and the Custodian and, if a
Default or Event of Default exists, with the Administrative Agent’s consent, request an increase
the Facility Amount by an amount that is an integral multiple of $1,000,000 and not less than
$10,000,000, provided, that the Facility Amount, as so increased, shall not exceed $100,000,000.
The right of the Borrower to request such increase is subject to the condition that no change in
Applicable Law shall have occurred, no order, judgment or decree of any Governmental Authority
shall have been issued, and no litigation shall be pending or threatened, which enjoins, prohibits
or restrains (or with respect to any litigation seeks to enjoin, prohibit or restrain), the making
or repayment of the Advances, the granting or perfection of liens in the Collateral, or the
consummation of any of the other transactions hereunder. The Borrower’s written request to increase
the Facility Amount shall constitute its representation and warranty as to the matters set forth in
the preceding sentence. In connection with the effectiveness of any such increase in the Facility
Amount, the Borrower shall pay to the Administrative Agent such arrangement fees as shall be
mutually agreed upon by the Borrower and the Administrative Agent. In connection with

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any such increase, (a) the Commitment of one or more Lenders that have agreed to such increase
(in their sole discretion) shall be increased and/or (b) one or more additional Persons may become
a Lender hereunder (each, an “Additional Lender”) with a Commitment in an amount agreed to
by any such Additional Lender. Each Additional Lender shall execute and deliver to the
Administrative Agent a joinder agreement to this Agreement evidencing its agreement to be bound
hereunder as a Lender. The Borrower shall deliver or cause to be delivered to the Administrative
Agent any legal opinions or other documents (including a resolution duly adopted by the board of
directors (or equivalent governing body) of the Borrower authorizing the incurrence of additional
borrowings pursuant to such increased Commitments) reasonably requested by the Administrative Agent
in connection with any such increase. No Lender shall be obligated to increase its Commitment
hereunder without the written consent of such Lender, which may be granted or withheld in its sole
discretion.

     (c) From time to time on any Payment Date during the Revolving Period, the Borrower may prepay
any portion or all of the Advances Outstanding in accordance with Section 2.7 (from amounts
on deposit in the Collection Account or otherwise available to the Borrower) by delivering to the
Administrative Agent and the Custodian a Borrower Notice at least two (2) Business Day prior to the
date of such repayment; provided, that no such reduction shall be given effect unless the
Borrower has complied with the terms of any Hedging Agreement requiring that one or more Hedge
Transactions be terminated in whole or in part as the result of any such prepayment of the Advances
Outstanding, and the Borrower has paid all Hedge Breakage Costs owing to the relevant Hedge
Counterparty for any such termination. If any Borrower Notice relating to any prepayment is given,
the amount specified in such Borrower Notice shall be due and payable on the date specified
therein, together with accrued Interest to the payment date on the amount prepaid and any Breakage
Costs (including Hedge Breakage Costs) related thereto. Without limiting the Borrower’s obligation
to pay Breakage Costs, such prepayment shall be without payment of any Prepayment Fee (except as
required by Section 2.3(a)) or other premium or penalty. Except in the case of a
prepayment of Advances required by Section 2.7, any partial prepayment by the Borrower of Advances
hereunder shall be in a minimum amount of $1,000,000 with integral multiples of $250,000 above such
amount. Any amount so prepaid may, subject to the terms and conditions hereof, be reborrowed during
the Revolving Period. A Borrower Notice relating to any such prepayment shall be irrevocable when
delivered.

Section 2.4 Principal Repayments.

     (a) The Advances Outstanding shall be due and payable in accordance with Section 2.7
on the Maturity Date.

     (b) All repayments of any Advance or any portion thereof shall be made together with payment
of (i) all Interest accrued and unpaid on the amount repaid to (but excluding) the date of such
repayment, (ii) any and all Breakage Costs, and (iii) all Hedge Breakage Costs and any other
amounts payable by the Borrower under or with respect to any Hedging Agreement.

     (c) In the event of (i) a breach of any representation or warranty (other than as set forth in
clause (ii) below) set forth in Section 4.1(y) with respect to any Eligible Loan
Asset or (ii) a breach of any representation or warranty set forth in Section 4.1(y) with
respect to any Eligible Loan Asset due to the failure of a trade for a security or loan listed on a
Funding Request to settle on the date expected (each such Loan Asset listed in clause (i)
or clause (ii), an “Ineligible Loan Asset”), no later than (x) in the case of an
Ineligible Loan Asset arising under clause (i) above, 5 Business Days and (y) in the case
of an Ineligible Loan Asset arising under clause (ii) above, 1 Business Day after the
earlier of (A) knowledge of such breach on the part of the Borrower and (B) receipt by the Borrower
of written notice thereof given by the Administrative Agent, the Borrower shall (1) repay Advances
Outstanding in an amount sufficient to cause the Collateral Tests to be met following such
repayment or, if less, in the amount by which the

37

 

calculation of Aggregate Borrowing Base Value at the time of such breach is overstated by
reason of such breach, or (2) substitute for such Ineligible Loan Asset a Substitute Loan Asset in
a quantity sufficient to cause the Collateral Tests to be met following such substitution, or if
less, in a quantity having a Borrowing Base Value at least equal to the amount by which the
calculation of Aggregate Borrowing Base Value at the time of such breach is overstated by reason of
such breach; provided, however, that no such repayment or substitution shall be required to be made
with respect to such Ineligible Loan Asset (and such Loan Asset shall cease to be an Ineligible
Loan Asset) if, on or before the expiration of such 5-Business Day or 1-Business Day period, the
representations and warranties in Section 4.1(y) with respect to such Ineligible Loan Asset
shall be made true and correct in all material respects with respect to such Ineligible Loan Asset
as made on such day.

     (d) No later than 2:00 p.m. on the Business Day prior to the proposed repayment of Advances or
pledge of Substitute Loan Assets pursuant to Section 2.4(c), the Borrower (or the Manager
on its behalf) shall deliver (i) to the Administrative Agent (with a copy to the Custodian), notice
of such repayment or pledge and a duly completed Borrower Notice, updated to the date such
repayment or pledge is being made and giving pro forma effect to such repayment or pledge, and (ii)
to the Administrative Agent, if applicable, a description of any Eligible Loan Asset and each
Obligor of such Eligible Loan Asset to be pledged and added to the updated Schedule of Loan Assets.
Any notice pertaining to any repayment or any pledge pursuant to this Section 2.4 shall be
irrevocable.

Section 2.5 The Notes.

     (a) Upon the request of any Lender, the Advances made by such Lender hereunder shall be
evidenced by a duly executed promissory note of the Borrower payable to such Lender in
substantially the form of Exhibit B hereto (collectively, the “Notes”). The Notes
shall be dated the Closing Date and shall be in a maximum principal amount equal to the applicable
Lender’s Commitment, and shall otherwise be duly completed.

     (b) Each Lender is hereby authorized to enter on a schedule attached to its Notes the
following notations (which may be computer generated) with respect to each Advance made by such
Lender: (i) the date and principal amount thereof and (ii) each payment and repayment of principal
thereof, and any such recordation shall constitute prima facie evidence of the accuracy of the
information so recorded. The failure of a Lender to make any such notation on the schedule attached
to the applicable Note shall not limit or otherwise affect the obligation of the Borrower to repay
the Advances in accordance with their respective terms as set forth herein.

Section 2.6 Interest Payments.

     (a) Interest shall accrue on each Advance during each Accrual Period at the applicable
Interest Rate. The Borrower shall pay Interest on the unpaid principal amount of each Advance for
the period commencing on and including the Funding Date of such Advance until but excluding the
date that such Advance shall be paid in full. Interest shall accrue during each Accrual Period and
be payable on the Advances Outstanding on each Payment Date, unless earlier paid pursuant to (i) a
prepayment in accordance with Section 2.3(c) or (ii) a repayment in accordance with
Section 2.4(b).

     (b) Each Lender shall determine its estimate of the Interest (including unpaid Interest, if
any, due and payable on a prior Payment Date) to be paid to such Lender on each Payment Date for
the related Accrual Period and shall advise the Administrative Agent and the Manager, on behalf of
the Borrower and the Custodian, thereof three (3) Business Days prior to each Payment Date. In the
event that any Lender’s estimate of the Interest payable for a related Accrual Period is different
from the actual amount

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of Interest for such Accrual Period, the Lender shall increase or decrease its estimate of
Interest for the next succeeding Accrual Period by the amount of such difference, plus interest
thereon at such rate.

     (c) If any Lender shall notify the Administrative Agent that a Eurodollar Disruption Event as
described in clause (a) of the definition of “Eurodollar Disruption Event” has occurred, the
Administrative Agent shall in turn so notify the Borrower, whereupon all affected Advances in
respect of which Interest accrues at the LIBOR Rate shall immediately be converted into Advances in
respect of which Interest accrues at the Base Rate.

     (d) Anything in this Agreement or the other Transaction Documents to the contrary
notwithstanding, if at any time the rate of interest payable by any Person under this Agreement and
the Transaction Documents exceeds the highest rate of interest permissible under Applicable Law
(the “Maximum Lawful Rate”), then, so long as the Maximum Lawful Rate would be exceeded,
the rate of interest under this Agreement and the Transaction Documents shall be equal to the
Maximum Lawful Rate. If at any time thereafter the rate of interest payable under this Agreement
and the Transaction Documents is less than the Maximum Lawful Rate, such Person shall continue to
pay interest under this Agreement and the Transaction Documents at the Maximum Lawful Rate until
such time as the total interest received from such Person is equal to the total interest that would
have been received had Applicable Law not limited the interest rate payable under this Agreement
and the Transaction Documents. In no event shall the total interest received by a Lender under this
Agreement and the Transaction Documents exceed the amount that such Lender could lawfully have
received, had the interest due under this Agreement and the Transaction Documents been calculated
since the Closing Date at the Maximum Lawful Rate.

     (e) The Borrower shall pay the fees specified hereunder and in the other Transaction Documents
in accordance with Section 2.7.

Section 2.7 Settlement Procedures.

     On each Payment Date, the Manager on behalf of the Borrower shall (and if the Manager fails to
do so the Administrative Agent may) direct the Custodian in writing to transfer Collections held by
the Account Bank in the Collection Account which were received in the immediately prior Settlement
Period (and, to the extent set forth in clauses (b) and (c) below, amounts on deposit in the
Reserve Account), in accordance with the Monthly Report, to the following Persons in the following
amounts and priority:

     (a) During the Revolving Period, and, in each case unless otherwise specified below, applying
Interest Collections (and, solely to the extent of any shortfall in clause (v) below, any amounts
on deposit in the Reserve Account), first, and then Principal Collections:

     (i) pro rata, to each Hedge Counterparty, any amounts, excluding any Hedge Breakage Costs
and any payments due in respect of the termination of any Hedge Transactions, owing to that
Hedge Counterparty under its respective Hedging Agreement in respect of any Hedge
Transaction(s), for the payment thereof;

     (ii) to the Custodian in an amount equal to any accrued and unpaid currently due Custodian
Fee, all unpaid Custodian Fees due from a prior Payment Date and all unpaid Custodian Expenses,
for the payment thereof; provided, that amounts payable as Custodian Expenses pursuant to this
clause (ii) shall not exceed $5,000 for any Payment Date;

     (iii) to the Borrower, in an amount equal to any accrued and unpaid Operating Expenses;
provided, that amounts payable pursuant to this clause (iii) shall not exceed (x) $350,000

39

 

for any Payment Date or (y) $2,500,000 for the immediately preceding period of twelve
consecutive Payment Dates (each such limitation in the foregoing clauses (x) and (y) to be
increased, if at all, on the first Payment Date to occur after each one-year anniversary of the
Closing Date by an amount equal to the lesser of (i) 5% and (ii) the percentage increase in the
fair market value of all assets of the Borrower, in each case on an annually compounding basis
as reported to the Administrative Agent prior to such Payment Date); provided that if a
Manager Event has occurred and is continuing, no such amounts shall be payable under this clause
(iii) unless consented to by the Administrative Agent;

     (iv) so long as no Manager Event has occurred and is continuing, to the Manager, the
accrued and unpaid Management Fee;

     (v) pro rata, (i) to the Administrative Agent in payment of the Administrative Agent Fee
and (ii) to each Lender in an amount equal to any accrued and unpaid Interest, Commitment Fee
and Breakage Costs, for the payment thereof;

     (vi) to the Unfunded Exposure Account in an amount necessary to cause the amount on deposit
in the Unfunded Exposure Account to equal the Exposure Amount;

     (vii) first, to the extent of available Principal Collections and second, to the extent of
available Interest Collections, pro rata to each Lender, (A) if no Event of Default has occurred
and is continuing, an amount, if necessary, in repayment of sufficient Advances Outstanding to
cause the Borrowing Base Test and the Coverage Tests to be satisfied and (B) if an Event of
Default has occurred and is continuing, in an amount necessary to reduce the Advances
Outstanding to zero;

     (viii) to pay the Advances Outstanding (to the extent not previously paid), together with
any applicable Prepayment Fee, in connection with any complete refinancing or termination of
this Agreement in accordance with Section 2.3(a);

     (ix) to the Reserve Account, an amount, if necessary, required for the amount on deposit in
the Reserve Account to equal the Reserve Account Required Amount;

     (x) to the Administrative Agent for the account of the applicable Affected Party, to be
paid pro rata to such Affected Party in accordance with the amount owed to such Person under
this clause (x), in an amount equal to any unpaid Increased Costs, Taxes payable under Section
2.12 and any Other Costs, for the payment thereof;

     (xi) to the Administrative Agent, the Lenders, the Affected Parties and the Indemnified
Parties (other than the Manager, if the Manager is an Affiliate of the Borrower), pro rata in
accordance with the amount owed to such Person under this clause (xi), all other amounts (other
than Advances Outstanding) then due under this Agreement, for the payment thereof;

     (xii) pro rata to each Hedge Counterparty, any Hedge Breakage Costs due under its
respective Hedging Agreement in respect of any Hedge Transaction(s), for the payment thereof;

     (xiii) to the Manager (if an Affiliate of the Borrower), (x) all Indemnified Amounts and
(y) reimbursement of all expenses payable to it pursuant to Section 7.7 and any other
amounts then due to it under this Agreement, for the payment thereof; and

     (xiv) all other remaining amounts shall be distributed to the Borrower.

40

 

     (b) Following the end of the Revolving Period, to the extent of available Interest Collections
and, solely to the extent of any shortfall in clause (v) below, any amounts on deposit in the
Reserve Account:

     (i) pro rata, to each Hedge Counterparty, any amounts, excluding any Hedge Breakage Costs,
owing to that Hedge Counterparty under its respective Hedging Agreement in respect of any Hedge
Transaction(s), for the payment thereof;

     (ii) to the Custodian in an amount equal to any accrued and unpaid currently due Custodian
Fee, all unpaid Custodian Fees due from a prior Payment Date and all unpaid Custodian Expenses,
for the payment thereof; provided, that amounts payable as Custodian Expenses pursuant to this
clause (ii) shall not exceed $5,000 for any Payment Date;

     (iii) to the Borrower, in an amount equal to any accrued and unpaid Operating Expenses;
provided, that amounts payable pursuant to this clause (iii) shall not exceed (x) $350,000 for
any Payment Date or (y) $2,500,000 for the immediately preceding period of twelve consecutive
Payment Dates (each such limitation in the foregoing clauses (x) and (y) to be increased, if at
all, on the first Payment Date to occur after each one-year anniversary of the Closing Date by
an amount equal to the lesser of (i) 5% and (ii) the percentage increase in the fair market
value of all assets of the Borrower, in each case on an annually compounding basis as reported
to the Administrative Agent prior to such Payment Date); provided that if a Manager
Event has occurred and is continuing, no such amounts shall be payable under this clause (iii)
unless consented to by the Administrative Agent;

     (iv) so long as no Manager Event has occurred and is continuing, to the Manager, the
accrued and unpaid Management Fee;

     (v) pro rata, (i) to the Administrative Agent in payment of the Administrative Agent Fee
and (ii) to each Lender in an amount equal to any accrued and unpaid Interest, Commitment Fee
and Breakage Costs, for the payment thereof;

     (vi) pro rata to each Lender, an amount, if necessary, in repayment of sufficient Advances
Outstanding (after giving effect to all distributions under clause (c) below) to cause the
Borrowing Base Test and the Coverage Tests to be satisfied;

     (vii) to the Reserve Account, an amount, if necessary, required for the amount on deposit
in the Reserve Account to equal the Reserve Account Required Amount;

     (viii) to the Administrative Agent, the Lenders, the Affected Parties and the Indemnified
Parties (other than the Manager, if the Manager is an Affiliate of the Borrower), pro rata in
accordance with the amount owed to such Person under this clause (viii), all other amounts
(other than Advances Outstanding) then due under this Agreement, for the payment thereof;

     (ix) pro rata to each Hedge Counterparty, any Hedge Breakage Costs due under its respective
Hedging Agreement in respect of any Hedge Transaction(s), for the payment thereof;

     (x) to the Manager (if an Affiliate of the Borrower), (x) all Indemnified Amounts and (y)
reimbursement of all expenses payable to it pursuant to Section 7.7 and any other
amounts then due to it under this Agreement, for the payment thereof; and

41

 

     (xi) all remaining amounts shall be distributed to the Borrower; provided,
however, that if an Event of Default has occurred and is continuing, all remaining
amounts shall be applied as Principal Collections in accordance with clause (c) below.

     (c) Following the end of the Revolving Period, to the extent of available Principal
Collections:

     (i) to the parties listed above, any amount remaining unpaid pursuant to clauses (i)
through (vii) under clause (b) above, in accordance with the priority set forth thereunder;

     (ii) to the Unfunded Exposure Account in an amount necessary to cause the amount on deposit
in the Unfunded Exposure Account to equal the Exposure Amount;

     (iii) pro rata to the Lenders, in an amount necessary to reduce the Advances Outstanding to
zero, for the payment thereof;

     (iv) to pay any applicable Prepayment Fee, in connection with any partial commitment
reduction or termination of this Agreement in accordance with Section 2.3(a);

     (v) pro rata to each Hedge Counterparty, any Hedge Breakage Costs due under its respective
Hedging Agreement in respect of any Hedge Transaction(s), for the payment thereof (to the extent
not paid pursuant to Section 2.7(b));

     (vi) to the Administrative Agent, the Lenders, the Affected Parties and the Indemnified
Parties (other than the Manager, if the Manager is an Affiliate of the Borrower), pro rata in
accordance with the amount owed to such Person under this clause (vi), all other amounts (other
than Advances Outstanding) then due under this Agreement, for the payment thereof (to the extent
not paid pursuant to Section 2.7(b));

     (vii) to the Manager (if an Affiliate of the Borrower), (x) all Indemnified Amounts and (y)
reimbursement of all expenses payable to it pursuant to Section 7.7 and any other
amounts then due to it under this Agreement, for the payment thereof (in each case, to the
extent not paid pursuant to Section 2.7(b)); and

     (viii) all remaining amounts shall be distributed to the Borrower.

     (d) On the terms and conditions hereinafter set forth, at any time during the Revolving
Period, the Manager may, to the extent of any Principal Collections on deposit in the Collection
Account, withdraw such funds for the purpose of reinvesting in additional Loan Assets (including,
if applicable, satisfying the Borrower’s obligation to deposit the Unfunded Exposure Equity Amount
into the Unfunded Exposure Account on the related Purchase Date for any Delayed Funding Loan
Asset), provided the following conditions are satisfied:

     (i) all conditions precedent set forth in Sections 3.2 and 3.3 have been
satisfied;

     (ii) the Manager provides same day written notice to the Administrative Agent and the
Custodian by facsimile or e-mail (to be received no later than 1:00 p.m. (New York time) on such
day) of the request to withdraw Principal Collections and the amount thereof;

     (iii) the notice required in clause (ii) above shall be accompanied by a Borrower
Notice executed by the Borrower and at least one Responsible Officer of the Manager;

42

 

     (iv) the Custodian provides to the Administrative Agent by facsimile or e-mail a statement
reflecting the total amount of Principal Collections on deposit on such day (and as of the time
noted on such statement) in the Collection Account; or

     (v) upon written confirmation by the Administrative Agent of the satisfaction of the
conditions set forth in clauses (i) through (iii) above (which shall be provided
by 2:30 p.m. (New York time) on the same date, if satisfied), the Custodian may release funds
from the Collection Account to the Manager in an amount not to exceed the lesser of (A) the
amount requested by the Manager and (B) the amount of Principal Collections on deposit in the
Collection Account on such day.

The Custodian shall provide the statement required under clause (iv) above no later than 4:00 p.m.
(New York time) on any Business Day it receives a request to withdraw Principal Collections from
the Manager pursuant to clause (ii) above.

     (e) Funds on deposit in the Unfunded Exposure Account as of any date of determination may be
withdrawn to fund draw requests of the relevant Obligors under any Delayed Funding Loan Asset;
provided that, the amount withdrawn to fund such draw request shall not cause the Borrowing Base
Test to fail to be satisfied. Any such draw request made by an Obligor, along with wiring
instructions for the applicable Obligor, shall be forwarded by the Borrower or the Manager to the
Custodian (with a copy to the Administrative Agent) in the form of a Borrower Notice, and the
Custodian shall instruct the Account Bank to fund such draw request in accordance with the Loan
Asset Documents pertaining to such Delayed Funding Loan Asset. Any amounts on deposit in the
Unfunded Exposure Account which exceed the Exposure Amount as of any date of determination shall be
deposited into the Collection Account as Principal Collections. The Manager shall (and if the
Manager fails to do so, the Administrative Agent may) direct the Custodian in writing to deposit in
the Unfunded Exposure Account all Collections received by the Borrower in respect of any principal
paid on the Delayed Funding Loan Assets included in the Collateral to the extent necessary to cause
the amount on deposit in the Unfunded Exposure Account to equal the Exposure Amount for all Delayed
Funding Loan Assets.

     (f) For the sake of clarity, the parties hereby agree that if the funds on deposit in the
Collection Account are insufficient to pay any amounts due and payable on a Payment Date or
otherwise, the Borrower shall nevertheless remain responsible for, and shall pay when due, all
amounts payable under this Agreement and the other Transaction Documents in accordance with the
terms of this Agreement and the other Transaction Documents.

Section 2.8 Collections and Allocations.

     (a) The Borrower or the Manager on behalf of the Borrower shall promptly (but in no event
later than two (2) Business Days after the receipt thereof) identify any Collections received by it
as being on account of Interest Collections or Principal Collections and deposit all such Interest
Collections or Principal Collections received directly by it into the Collection Account. The
Manager on behalf of the Borrower shall make such deposits or payments on the date indicated by
wire transfer, in immediately available funds.

     (b) Until the occurrence of an Event of Default, to the extent there are uninvested amounts
deposited in the Collection Account, all amounts shall be invested in Permitted Investments
selected by the Manager on behalf of the Borrower that mature no later than the Business Day
immediately preceding the next Payment Date; from and after (i) the occurrence of an Event of
Default or (ii) the appointment of a Successor Manager, to the extent there are uninvested amounts
deposited in the Collection Account, all amounts may be invested in Permitted Investments selected
by the Administrative Agent that mature no

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later than the next Business Day. Any earnings (and losses) thereon shall be for the account
of the Borrower.

     (c) Notwithstanding anything to the contrary contained herein or in any other Transaction
Document, all payments required to be made by the Borrower hereunder shall be made by the Borrower,
or the Manager acting on its behalf, directing the Custodian in writing to make such payments. The
Custodian shall make such payments to the Secured Parties and any other Persons pursuant to this
Agreement based solely on the information set forth in instructions, including the Monthly Report,
furnished by the Borrower or the Manager acting on behalf of the Borrower, and shall be entitled to
conclusively rely on such information and reports, and on the calculations contained therein when
making such payments.

Section 2.9 Payments, Computations, Etc.

     (a) Unless otherwise expressly provided herein, all amounts to be paid or deposited by the
Borrower or the Manager on behalf of the Borrower hereunder shall be paid or deposited in
accordance with the terms hereof no later than 10:00 a.m. (New York City time) on the day when due
in lawful money of the United States in immediately available funds to the Administrative Agent’s
Account. The Borrower shall, to the extent permitted by law, pay to the Secured Parties interest on
all amounts not paid or deposited when due hereunder at 2.0% per annum above the sum of the Base
Rate plus the Applicable Margin, payable on demand; provided, however, that such
interest rate shall not at any time exceed the Maximum Lawful Rate. All computations of interest
and all computations of the Interest Rate (other than Base Rate calculations) and fees shall be
made on the basis of a year of 360 days for the actual number of days (including the first but
excluding the last day) elapsed. All computations of interest calculated with reference to the Base
Rate hereunder shall be made on the basis of a year of 365/366 days for the actual number of days
(including the first but excluding the last day) elapsed.

     (b) Whenever any payment hereunder shall be stated to be due on a day other than a Business
Day, such payment shall be made on the next succeeding Business Day, and such extension of time
shall in such case be included in the computation of payment of Interest, other interest or any fee
payable hereunder, as the case may be.

     (c) All payments hereunder shall be made without set-off or counterclaim and in such amounts
as may be necessary in order that all such payments shall not be less than the amounts otherwise
specified to be paid under this Agreement (after withholding for or on account of any Taxes).

Section 2.10 Breakage Costs.

     The Borrower shall pay to the Administrative Agent for the account of the applicable Lender
upon the request of any Lender or the Administrative Agent on each Payment Date on which a
prepayment is made, such amount or amounts as shall, without duplication, compensate the Lenders
for any actual loss, cost or expense (the “Breakage Costs”) incurred by the Lenders (as
reasonably determined by the applicable Lender) as a result of any prepayment of an Advance (and
interest thereon) arising under this Agreement. The determination by any Lender of the amount of
any such loss or expense shall be set forth in a written notice to the Borrower delivered by the
applicable Lender prior to the date of such prepayment in the case where notice of such prepayment
is delivered to such Lender in accordance with Section 2.3(c) or within two (2) Business
Days following such prepayment in the case where no such notice is delivered (in which case,
Breakage Costs shall include interest thereon from the date of such prepayment) and shall be
conclusive absent manifest error. No Breakage Costs shall be payable to any Lender to the extent
that (i) notice of such prepayment shall have been delivered to such Lender in accordance with the
provisions of Section 2.3(c) or (ii) such prepayment is made on a Payment Date.

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Section 2.11 Increased Costs; Capital Adequacy; Illegality.

     (a) If after the date hereof, any Lender or any Affiliate thereof (each of which, an
“Affected Party”) shall be charged any fee, expense or increased cost on account of the
adoption of any applicable law, rule or regulation (including any applicable law, rule or
regulation regarding capital adequacy), any accounting principles or any change in any of the
foregoing, or any change in the interpretation or administration thereof by any governmental
authority, the Financial Accounting Standards Board (“FASB”), any central bank or any
comparable agency charged with the interpretation or administration thereof, or compliance with any
request or directive (whether or not having the force of law) of any such authority or agency (a
“Regulatory Change”): (i) that subjects any Affected Party to any charge or withholding on
or with respect to any Transaction Document or an Affected Party’s obligations under a Transaction
Document, or on or with respect to the Advances, or changes the basis of taxation of payments to
any Affected Party of any amounts payable under any Transaction Document (except for changes in the
rate of tax on the overall net income of an Affected Party or taxes excluded by Section
2.12) or (ii) that imposes, modifies or deems applicable any reserve, assessment, insurance
charge, special deposit or similar requirement against assets of, deposits with or for the account
of an Affected Party, or credit extended by an Affected Party pursuant to a Transaction Document or
(iii) that imposes any other condition the result of which is to increase the cost to an Affected
Party of performing its obligations under a Transaction Document, or to reduce the rate of return
on an Affected Party’s capital as a consequence of its obligations under a Transaction Document, or
to reduce the amount of any sum received or receivable by an Affected Party under a Transaction
Document or to require any payment calculated by reference to the amount of interests or loans held
or interest received by it, then, upon demand by the applicable Lender, Borrower shall pay to the
Administrative Agent, for payment to the applicable Affected Party, such amounts charged to such
Affected Party or such amounts to otherwise compensate such Affected Party for such increased cost
or such reduction.

     (b) In determining any amount provided for in this section, the Affected Party may use any
reasonable averaging and attribution methods. Any Affected Party making a claim under this section
shall submit to the Borrower a certificate as to such additional or increased cost or reduction,
which certificate shall calculate in reasonable detail any such charges and shall be conclusive
absent demonstrable error.

Section 2.12 Taxes.

     (a) All payments made by the Borrower in respect of any Advance and all payments made by the
Borrower under this Agreement will be made free and clear of and without deduction or withholding
for or on account of any Taxes, unless such withholding or deduction is required by law. In such
event, the Borrower shall pay to the appropriate taxing authority any such Taxes required to be
deducted or withheld and the amount payable to each Lender or the Administrative Agent (as the case
may be) will be increased (such increase, the “Additional Amount”) such that every net
payment made under this Agreement after deduction or withholding for or on account of any Taxes
(including any Taxes on such increase) is not less than the amount that would have been paid had no
such deduction or withholding been deducted or withheld. The foregoing obligation to pay Additional
Amounts, however, will not apply with respect to, and the term “Additional Amount” shall be deemed
not to include (i) net income or franchise taxes imposed on a Lender or the Administrative Agent,
respectively, with respect to payments required to be made by the Borrower or Manager on behalf of
the Borrower under this Agreement, by a taxing jurisdiction in which such Lender or the
Administrative Agent is organized, has its applicable lending office, conducts business or is
paying taxes as of the Closing Date (as the case may be) (ii) any branch profits taxes imposed by
the United States of America or any similar tax imposed by any other jurisdiction in which the
Borrower is located and (iii) in the case of a Foreign Lender, any withholding tax that is imposed
on amounts payable to such Foreign Lender, at the time such Foreign Lender becomes a party,
attributable to such Foreign Lender’s failure to comply with Section 2.12(d). If a Lender
or the

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Administrative Agent pays any Taxes in respect of which the Borrower is obligated to pay
Additional Amounts under this Section 2.12(a), the Borrower shall promptly reimburse such
Lender or Administrative Agent in full.

     (b) The Borrower will indemnify each Lender and the Administrative Agent for the full amount
of Taxes in respect of which the Borrower is required to pay Additional Amounts (including any
Taxes imposed by any jurisdiction on such Additional Amounts) paid by such Lender or the
Administrative Agent (as the case may be) and any liability (including penalties, interest and
expenses) arising therefrom or with respect thereto; provided, however, that such
Lender or the Administrative Agent, as appropriate, making a demand for indemnity payment, shall
provide the Borrower, at its address set forth under its name on the signature pages hereof, with a
certificate from the relevant taxing authority or from a Responsible Officer of such Lender or the
Administrative Agent stating or otherwise evidencing that such Lender or the Administrative Agent
has made payment of such Taxes and will provide a copy of or extract from documentation, if
available, furnished by such taxing authority evidencing assertion or payment of such Taxes. This
indemnification shall be made within ten (10) days from the date such Lender or the Administrative
Agent (as the case may be) makes written demand therefor.

     (c) Within thirty (30) days after the date of any payment by the Borrower of any Taxes, the
Borrower will furnish to the Administrative Agent or the Lender, as applicable, at its address set
forth under its name on the signature pages hereof, appropriate evidence of payment thereof.

     (d) If a Lender is not created or organized under the laws of the United States or a political
subdivision thereof (each such Lender being sometimes referred to as a “Foreign Lender”),
such Lender shall, to the extent that it may then do so under Applicable Laws, deliver to the
Borrower with a copy to each of the Custodian and the Administrative Agent (i) within fifteen (15)
days after the date hereof, or, if later, the date on which such Lender becomes a Lender hereof two
(or such other number as may from time to time be prescribed by Applicable Laws) duly completed
copies of IRS Form W-8EC1 or Form W-8BEN or any successor forms or other certificates or statements
that may be required from time to time by the relevant United States taxing authorities or
Applicable Laws), as appropriate, to permit the Borrower to make payments hereunder for the account
of such Lender, as the case may be, without deduction or withholding of United States federal
income or similar Taxes and (ii) upon the obsolescence of or after the occurrence of any event
requiring a change in, any form or certificate previously delivered pursuant to this Section
2.12(d), two copies (or such other number as may from time to time be prescribed by Applicable
Laws) of such additional, amended or successor forms, certificates or statements as may be required
under Applicable Laws to permit the Borrower to make payments hereunder for the account of such
Lender, without deduction or withholding of United States federal income or similar Taxes.

     (e) Within thirty (30) days of the written request of the Borrower therefor, the
Administrative Agent or the Lender, as appropriate, shall execute and deliver to the Borrower such
certificates, forms or other documents that can be furnished consistent with the facts and that are
reasonably necessary to assist the Borrower in applying for refunds of Taxes remitted hereunder;
provided, however, that the Administrative Agent and the Lender shall not be
required to deliver such certificates forms or other documents if in their respective sole
discretion it is determined that the delivery of such certificate, form or other document would
have a material adverse effect on the Administrative Agent or the Lender and provided further,
however, that the Borrower shall reimburse the Administrative Agent or the Lender for any
reasonable expenses incurred in the delivery of such certificate, form or other document.

     (f) If, in connection with an agreement or other document providing liquidity support, credit
enhancement or other similar support to the Lenders in connection with this Agreement or the
funding or maintenance of Advances hereunder, the Lenders are required to compensate a bank or
other financial institution in respect of Taxes under circumstances similar to those described in
this section then within

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ten (10) days after demand by the Lenders, the Borrower shall pay to the Lenders such
additional amount or amounts as may be necessary to reimburse the Lenders for any amounts paid by
them.

     (g) In the event that the Borrower is obligated to make an indemnification payment pursuant to
this Section 2.12 and the recipient receives a refund of Taxes with respect to which the
Borrower made an indemnification payment, the recipient promptly shall remit the amount of such
refund to the Borrower.

     (h) In the event that the Borrower becomes obligated to make an indemnification payment
pursuant to this Section 2.12 to any Lender, the Borrower may request that such Lender
designate an alternative applicable lending office in order to avoid the need for any such
indemnification payment which may thereafter accrue. Such Lender shall use reasonable efforts
(consistent with its internal policy and legal and regulatory restrictions) to change the
jurisdiction of its lending office, if such change would not, in the reasonable determination of
such Lender, cause such Lender to be in violation of any applicable law, regulation, treaty or
guideline, cause such Lender to incur any additional material costs or expenses, or otherwise be
materially disadvantageous to such Lender.

     (i) Upon request of the Borrower or the Manager, each Lender that is not a Foreign Lender
shall deliver to the Borrower and the Manager two duly completed copies of Internal Revenue Service
form W-9 or applicable successor form. If such Lender fails to deliver such forms, then the
Borrower or the Manager may withhold from any payment to such Lender an amount equivalent to the
applicable backup withholding tax imposed with respect to such payment under the Code.

Section 2.13 Fees.

     (a) Commitment Fee. The Borrower shall pay on each Payment Date in accordance with
Section 2.7, pro rata to each Lender (either directly or through the Administrative Agent),
a commitment fee (the “Commitment Fee”) payable in arrears for each Settlement Period,
equal to the sum of the products for each day during such Settlement Period of (i) one divided by
360, (ii) 0.75% per annum, and (iii) the aggregate Commitments minus the Advances Outstanding on
such day. The Commitment Fee shall be computed for the actual number of days elapsed on the basis
of a year of 360 days.

     (b) Agent’s Fees. The Borrower agrees to pay to the Administrative Agent, for its own
account, on the Closing Date and on certain other dates pursuant to the Fee Letter and as otherwise
agreed to from time to time by the Borrower and the Administrative Agent, fees in the amounts
agreed to between the Borrower and the Administrative Agent.

Section 2.14 Discretionary Sales of Loan Assets.

     On any Discretionary Sale Settlement Date, the Borrower shall have the right to sell and
assign, and cause the release of the Lien by the Administrative Agent over, one or more Loan
Assets, in whole but not in part (a “Discretionary Sale”), subject to the following terms
and conditions and subject to the other restrictions contained herein:

     (a) any Discretionary Sale shall be made by the Borrower in a transaction (A) arranged by the
Manager in accordance with the customary management practices of prudent institutions which manage
financial assets similar to the Loan Assets for their own account or for the account of others, (B)
reflecting arm’s-length market terms and (C) in which the Borrower makes no representations,
warranties or covenants and provides no indemnification for the benefit of any other party to the
Discretionary Sale (other than any representations, warranties or covenants relating to the
Borrower’s ownership of or title to the Loan Asset that is the subject of the Discretionary Sale
that are standard and customary in connection

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with such a sale or for which the Performance Guarantor has agreed to fully indemnify the
Borrower). The prior written consent of the Administrative Agent shall be required if such Loan
Asset to be sold is for an amount which is less than the product of the Applicable Advance Rate
times the Adjusted Borrowing Value of such Loan Asset.

     (b) after giving effect to the Discretionary Sale on the related Discretionary Sale Trade Date
and the payment required under Section 2.14(d), (A) all representations and warranties of
the Borrower contained in Section 4.1 shall be true and correct as of the Discretionary
Sale Trade Date, (B) no Default or Event of Default shall have occurred and be continuing or result
therefrom, and (C) the Collateral Tests shall have been satisfied, and the Borrower shall have
delivered to the Administrative Agent a Borrower Notice demonstrating compliance with clause (C)
above;

     (c) on the Discretionary Sale Trade Date, the Borrower and the Manager shall be deemed to have
represented and warranted that the requirements of Section 2.14(b) shall have been
satisfied as of the related Discretionary Sale Trade Date after giving effect to the contemplated
Discretionary Sale; and

     (d) on the related Discretionary Sale Settlement Date, an amount equal to the proceeds of such
Discretionary Sale shall have been deposited into the Collection Account in immediately available
funds.

     In connection with any Discretionary Sale, following receipt by the Custodian of the amounts
referred to in Section 2.14(d) above (receipt of which shall be confirmed to the
Administrative Agent), there shall be released to the Borrower (for further sale to a purchaser)
without recourse, representation or warranty of any kind all of the right, title and interest of
the Custodian and the Secured Parties in, to and under the portion of the Collateral subject to
such Discretionary Sale and such portion of the Collateral so released shall be released from any
Lien and the Loan Documents (subject to the requirements set forth above in this Section
2.14).

     In connection with any Discretionary Sale, on the related Discretionary Sale Settlement Date,
the Administrative Agent and the Custodian, as applicable, on behalf of the Secured Parties shall
(i) execute such instruments of release with respect to the portion of the Collateral to be
released to the Borrower, in recordable form if necessary, in favor of the Borrower as the Manager
on behalf of the Borrower may reasonably request, (ii) deliver any portion of the Collateral to be
released to the Borrower in its possession to the Borrower and (iii) otherwise take such actions,
as are determined by the Borrower or Manager to be reasonably necessary and appropriate to release
the Lien on the portion of the Collateral to be released to the Borrower and release and deliver to
the Borrower such portion of the Collateral to be released to the Borrower.

ARTICLE III

CONDITIONS OF EFFECTIVENESS AND ADVANCES

Section 3.1 Conditions to Effectiveness and Advances.

     No Lender shall be obligated to make any Advance hereunder, nor shall any Lender, the
Custodian or the Administrative Agent be obligated to take, fulfill or perform any other action
hereunder, until the following conditions have been satisfied on the Closing Date, in the sole
discretion of, or waived in writing by, the Administrative Agent:

     (a) This Agreement and all other Transaction Documents or counterparts hereof or thereof shall
have been duly executed by, and delivered to, the parties hereto and thereto and the Administrative

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Agent shall have received such other documents, instruments, agreements and legal opinions as
the Administrative Agent shall reasonably request in connection with the transactions contemplated
by this Agreement, on or prior to the Closing Date (including the documents listed on Schedule
I hereto), each in form and substance reasonably satisfactory to the Administrative Agent;

     (b) The Borrower shall have paid all fees required to be paid by it on the Closing Date,
including all fees required hereunder and under the Fee Letter to be paid as of such date, and
shall have reimbursed each Lender and the Administrative Agent for all reasonable fees, costs and
expenses related to the transactions contemplated hereunder and under the other Transaction
Documents, including the reasonable legal and other document preparation costs incurred by any
Lender and/or the Administrative Agent;

     (c) After giving effect to the making of Advances on the Closing Date and the payment of all
fees and expenses in connection with this Agreement and the other Transaction Documents and the
other transactions to occur on the Closing Date, Availability on the Closing Date shall equal at
least $2,900,000; and

     (d) The recapitalization of GSC Investment shall have occurred pursuant to which the Specified
Holders shall have made a cash equity investment in GSC Investment in an amount equal to at least
$15,000,000.

     The Administrative Agent shall promptly notify the Borrower and each Lender of the
satisfaction or waiver of the conditions set forth above.

Section 3.2 Additional Conditions Precedent to All Advances. 

     Each Advance shall be subject to the further conditions precedent that:

     (a) On the related Funding Date, the Borrower or the Manager, as the case may be, shall have
certified in the related Borrower Notice that:

     (i) The representations and warranties set forth in Sections 4.1, 4.2 and
7.5 are true and correct on and as of such date, before and after giving effect to such
borrowing and to the application of the proceeds therefrom, as though made on and as of such
date (except to the extent such representations and warranties expressly relate to a specific
earlier date, in which case such representations and warranties shall be true and correct as of
such earlier date); and

     (ii) No event has occurred, or would result from such Advance or from the application of
the proceeds therefrom, that constitutes an Event of Default or a Default.

     (b) The Termination Date shall not have occurred; and

     (c) Before and after giving effect to such borrowing and to the application of proceeds
therefrom (i) each of the Collateral Tests shall be satisfied, as calculated on such date and (ii)
the sum of Advances Outstanding and the Unfunded Exposure Amount shall not be greater than the
Facility Amount.

Section 3.3 Conditions to Acquisitions and Pledges of Collateral.

     In addition to the requirements set forth in Section 2.2 in respect of Advances, each
acquisition and pledge of an additional Loan Asset shall be subject to the further conditions
precedent that:

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     (a) the Manager (on behalf of the Borrower) shall have delivered to the Administrative Agent
(with a copy to the Custodian no later than 5:00 p.m. on the date that is one Business Day prior to
the related Purchase Date: (A) a calculation of the Borrowing Base (giving pro forma effect to the
pledge of the additional Eligible Loan Asset), (B) a Schedule of Loan Assets and (C) a Borrower
Notice containing such additional information as may be reasonably requested by the Administrative
Agent;

     (b) the Borrower shall have delivered to the Custodian (with a copy to the Administrative
Agent), no later than 2:00 p.m. one Business Day prior to the related Purchase Date, a faxed or
e-mailed copy of the duly executed original promissory notes of the Loan Assets (and, in the case
of any Noteless Loan Asset, a fully executed assignment agreement); provided that,
notwithstanding the foregoing, the Borrower shall cause the Loan Asset Files to be delivered to the
Custodian in accordance with Section 5.4.

     (c) each item of Collateral constituting Supplemental Interests, the Borrower shall have taken
all actions necessary or advisable in order for the Administrative Agent to have a perfected
security interest in such Collateral, including delivery of such Collateral to the Custodian in
accordance with Section 5.4.

     Notwithstanding anything contained in this Agreement or any other Transaction Document to the
contrary, in no event shall the Borrower acquire any additional Loan Assets (regardless of whether
such Loan Asset shall be eligible for inclusion in the Borrowing Base) unless the Administrative
Agent shall have given its prior written consent thereto (which consent may be granted or withheld
in its sole and absolute discretion); provided that the Administrative Agent’s consent rights under
this sentence shall cease at such time as the Administrative Agent shall have informed the Manager
in writing that the Administrative Agent is satisfied with the Manager’s policies, personnel and
processes in respect of the structuring, underwriting, origination and monitoring of Loan Assets.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES

Section 4.1 Representations and Warranties of the Borrower. 

     The Borrower represents and warrants as of the Closing Date, each Funding Date, each Purchase
Date, each Determination Date and each other date on which a Monthly Report or Borrower Notice is
delivered hereunder, as follows:

     (a) Organization and Good Standing. The Borrower is a Delaware limited liability
company duly organized, validly existing, and in good standing under the laws of the jurisdiction
of its formation, and has full power, authority and legal right to own or lease its properties and
conduct its business as such business is presently conducted.

     (b) Due Qualification. The Borrower is qualified to do business as a limited liability
company, is in good standing, and has obtained all licenses and approvals as required under the
laws of all jurisdictions in which the ownership or lease of its property and or the conduct of its
business (other than the performance of its obligations hereunder) requires such qualification,
standing, license or approval, except to the extent that the failure to so qualify, maintain such
standing or be so licensed or approved would not have an adverse effect on the interests of the
Lenders. The Borrower is qualified to do business as a limited liability company, is in good
standing, and has obtained all licenses and approvals as required under the laws of all states in
which the performance of its obligations pursuant to this Agreement

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requires such qualification, standing, license or approval and where the failure to qualify or
obtain such license or approval would have material adverse effect on its ability to perform
hereunder.

     (c) Due Authorization. The execution and delivery of this Agreement and each
Transaction Document to which the Borrower is a party and the consummation of the transactions
provided for herein and therein have been duly authorized by the Borrower by all necessary action
on the part of the Borrower.

     (d) No Conflict. The execution and delivery of this Agreement and each Transaction
Document to which the Borrower is a party, the performance by the Borrower of the transactions
contemplated hereby and thereby and the fulfillment of the terms hereof and thereof will not
conflict with or result in any breach of any of the terms and provisions of, and will not
constitute (with or without notice or lapse of time or both) a default under, the Borrower’s
limited liability company agreement or any material Contractual Obligation of the Borrower.

     (e) No Violation. The execution and delivery of this Agreement and each Transaction
Document to which the Borrower is a party, the performance of the transactions contemplated hereby
and thereby and the fulfillment of the terms hereof and thereof will not conflict with or violate
any Applicable Law in a manner that could reasonably be expected to have a Material Adverse Effect.

     (f) No Proceedings. There are no proceedings or investigations pending or, to the best
knowledge of the Borrower, threatened against the Borrower, before any Governmental Authority (i)
asserting the invalidity of this Agreement or any Transaction Document to which the Borrower is a
party, (ii) seeking to prevent the consummation of any of the transactions contemplated by this
Agreement or any Transaction Document to which the Borrower is a party or (iii) that could
reasonably be expected to have a Material Adverse Effect.

     (g) All Consents Required. All material approvals, authorizations, consents, orders or
other actions of any Person or of any Governmental Authority (if any) required in connection with
the due execution, delivery and performance by the Borrower of this Agreement and any Transaction
Document to which the Borrower is a party, have been obtained.

     (h) Reports Accurate. All Monthly Reports (if prepared by the Borrower, or to the
extent that information contained therein is supplied by the Borrower), information, exhibit,
financial statement, document, book, record or report furnished or to be furnished by the Borrower
to the Administrative Agent, the Custodian or a Lender in connection with this Agreement are true,
complete and accurate in all material respects.

     (i) Solvency. The transactions contemplated under this Agreement and each Transaction
Document to which the Borrower is a party do not and will not render the Borrower not Solvent.

     (j) [Reserved].

     (k) Taxes. The Borrower has filed or caused to be filed all Tax returns required to be
filed by it. The Borrower has paid all Taxes and all assessments made against it or any of its
property (other than any amount of Tax the validity of which is currently being contested in good
faith by appropriate proceedings and with respect to which reserves in accordance with GAAP have
been provided on the books of the Borrower), and no Tax lien has been filed.

     (l) Agreements Enforceable. This Agreement and each Transaction Document to which the
Borrower is a party constitute the legal, valid and binding obligation of the Borrower enforceable
against

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the Borrower in accordance with their respective terms, except as such enforceability may be
limited by Insolvency Laws and except as such enforceability may be limited by general principles
of equity (whether considered in a suit at law or in equity).

     (m) No Liens. The Collateral is owned by the Borrower free and clear of any Liens
except for Permitted Liens as provided herein, and the Administrative Agent, for the benefit of the
Secured Parties, has a valid and perfected first priority security interest in the Collateral then
existing or thereafter arising, free and clear of any Liens except for Permitted Liens. No
effective financing statement or other instrument similar in effect covering any Collateral is on
file in any recording office except such as may be filed in favor of the Administrative Agent, for
the benefit of the Secured Parties, relating to this Agreement or reflecting the transfer of the
Closing Date Loan Assets from the Performance Guarantor to the Borrower pursuant to the Purchase
Agreement.

     (n) Security Interest.

     (i) The Borrower has granted a security interest (as defined in the UCC) to the
Administrative Agent, for the benefit of the Secured Parties, in the Collateral, which is
enforceable in accordance with Applicable Law. All filings (including such UCC filings) as are
necessary in any jurisdiction to perfect the interest of the Administrative Agent, for the
benefit of the Secured Parties, in the Collateral have been made;

     (ii) this Agreement creates a valid and continuing security interest (as defined in the
applicable UCC) in the Collateral in favor of the Administrative Agent, on behalf of the Secured
Parties, which security interest is prior to all other Liens (except for Permitted Liens), and
is enforceable as such against creditors of and purchasers from the Borrower;

     (iii) the Collateral is comprised of “instruments”, “security entitlements”, “general
intangibles”, “tangible chattel paper”, “accounts”, “certificated securities”, “uncertificated
securities”, “securities accounts”, “deposit accounts”, “supporting obligations” or “insurance”
(each as defined in the applicable UCC), real property and/or such other category of collateral
under the applicable UCC as to which the Borrower has complied with its obligations under this
Section 4.01(n) ;

     (iv) with respect to Collateral that constitute “security entitlements”: (A) all of such
security entitlements have been credited to one of the Controlled Accounts and the securities
intermediary for each Controlled Account has agreed to treat all assets credited to such
Controlled Account as “financial assets” within the meaning of the applicable UCC; (B) the
Borrower has taken all steps necessary to cause the securities intermediary to identify in its
records the Borrower, for the benefit of the Secured Parties, as the Person having a security
entitlement against the securities intermediary in each of the Controlled Accounts; and (C) the
Controlled Accounts are not in the name of any Person other than the Borrower, subject to the
lien of the Administrative Agent, for the benefit of the Secured Parties. The securities
intermediary of any Controlled Account which is a “securities account” under the UCC has agreed
to comply with the entitlement orders and instructions of the Borrower, the Manager and the
Administrative Agent in accordance with the Transaction Documents, including causing cash to be
invested in Permitted Investments; provided that, upon the delivery of a Notice of Exclusive
Control (as defined under the Account Control Agreement, as applicable) by the Administrative
Agent, the securities intermediary has agreed to only follow the entitlement orders and
instructions of the Administrative Agent, on behalf of the Secured Parties, including with
respect to the investment of cash in Permitted Investments;

     (v) all Controlled Accounts constitute “securities accounts” or “deposit accounts” as
defined in the applicable UCC;

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     (vi) with respect to any Controlled Account which constitutes a “deposit account” as
defined in the applicable UCC, the Borrower, the Account Bank and the Administrative Agent, on
behalf of the Secured Parties, have entered into an account control agreement which permits the
Administrative Agent on behalf of the Secured Parties to direct disposition of the funds in such
deposit account;

     (vii) the Borrower owns and has good and marketable title to (or with respect to assets
securing any Loan Assets, a valid security interest in) the Collateral free and clear of any
Lien (other than Permitted Liens) of any Person;

     (viii) the Borrower has received all consents and approvals required by the terms of any
Loan Asset to the granting of a security interest in the Loan Assets hereunder to the
Administrative Agent, on behalf of the Secured Parties;

     (ix) the Borrower has caused the filing of all appropriate financing statements in the
proper filing office in the appropriate jurisdictions under Applicable Law in order to perfect
the security interest in the Collateral and that portion of the Loan Assets in which a security
interest may be perfected by filing granted to the Administrative Agent, on behalf of the
Secured Parties, under this Agreement; provided that filings in respect of real property shall
not be required;

     (x) other than as expressly permitted by the terms of this Agreement and the security
interest granted to the Administrative Agent, on behalf of the Secured Parties, pursuant to this
Agreement, the Borrower has not pledged, assigned, sold, granted a security interest in or
otherwise conveyed any of the Collateral. The Borrower has not authorized the filing of and is
not aware of any financing statements against the Borrower that include a description of
collateral covering the Collateral other than any financing statement (A) relating to the
security interests granted to the Borrower under the Purchase Agreement and the CLO Management
Contribution Agreement, or (B) that has been terminated and/or fully and validly assigned to the
Administrative Agent on or prior to the date hereof. The Borrower is not aware of the filing of
any judgment or Tax lien filings against the Borrower;

     (xi) all original executed copies of each underlying promissory note or other records, as
applicable, that constitute or evidence each Loan Asset and each other item of Collateral has
been, or subject to the delivery requirements contained herein, will be delivered to the
Custodian;

     (xii) other than in the case of Noteless Loan Assets, the Borrower has received, or subject
to the delivery requirements contained herein will receive, a written acknowledgment from the
Custodian that the Custodian, as the bailee of the Administrative Agent, is holding the
underlying promissory notes that constitute or evidence the Loan Assets solely on behalf of and
for the Administrative Agent, for the benefit of the Secured Parties;

     (xiii) none of the underlying promissory notes or other Loan Asset Documents, as
applicable, that constitute or evidence the Loan Assets has any marks or notations indicating
that they have been pledged, assigned or otherwise conveyed to any Person other than the
Administrative Agent, on behalf of the Secured Parties;

     (xiv) with respect to any Collateral that constitutes a “certificated security,” such
certificated security has been delivered to the Custodian, on behalf of the Secured Parties and,
if in registered form, has been specially Indorsed to the Administrative Agent, for the benefit
of the Secured Parties, or in blank by an effective Indorsement or has been registered in the
name of the

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Administrative Agent, for the benefit of the Secured Parties, upon original issue or
registration of transfer by the Borrower of such certificated security; and

     (xv) with respect to any Collateral that constitutes an “uncertificated security”, that the
Borrower shall cause the issuer of such uncertificated security to register the Administrative
Agent, on behalf of the Secured Parties, as the registered owner of such uncertificated
security.

     (o) Location of Offices. The Borrower’s jurisdiction of organization, principal place
of business and chief executive office and the office where the Borrower keeps all the Records is
located at the address of the Borrower referred to in Section 12.2 hereof (or at such other
locations as to which the notice and other requirements specified in Section 5.1(m) shall
have been satisfied).

     (p) Tradenames. The Borrower has no trade names, fictitious names, assumed names or
“doing business as” names or other names under which it has done or is doing business, except that
the Borrower shall be permitted to change its name to “Saratoga Investment Funding LLC” upon
compliance with the provisions of Section 5.1(k).

     (q) Value Given. The Borrower gave reasonably equivalent value to the Performance
Guarantor in consideration for the transfer to the Borrower of the applicable Loan Assets under the
Purchase Agreement, no such transfer was made for or on account of an antecedent debt owed by the
Performance Guarantor to the Borrower, and no such transfer is voidable or subject to avoidance
under any Insolvency Law.

     (r) Accounting. The Borrower accounts for the applicable transfers to it from the
Performance Guarantor of interests in the Loan Assets under the Purchase Agreement and interests in
the CLO Management Fees under the CLO Management Contribution Agreement as sales or contributions
of such Loan Assets or CLO Management Fees, as applicable, in its books, records and financial
statements (although the financial statements of the Borrower and Performance Guarantor may be
consolidated), in each case consistent with GAAP.

     (s) Separate Entity. The Borrower is, and since its formation has been, operated as an
entity with assets and liabilities distinct from those of the Performance Guarantor and any
Affiliates thereof (other than the Borrower) and has complied in all material respects with the
provisions set forth in Section 5.1(l), and the Borrower hereby acknowledges that the
Administrative Agent and the Lenders are entering into the transactions contemplated by this
Agreement in reliance upon the Borrower’s identity as a separate legal entity from the Performance
Guarantor and from each such other Affiliate of the Performance Guarantor.

     (t) Investments. Except for Supplemental Interests or Supplemental Interests that
convert into an equity interest in any Person or the CLO Equity, the Borrower does not own or hold
directly or indirectly, any capital stock or equity security of, or any equity interest in, any
Person.

     (u) Business. Since its formation, the Borrower has conducted no business other than
the purchase and receipt of Loan Assets and Related Property and the other Collateral, the
borrowing of funds under this Agreement and the Prior Credit Agreement and such other activities as
are incidental to the foregoing.

     (v) ERISA. The Borrower is in compliance in all material respects with all applicable
provisions of ERISA and has not incurred and does not expect to incur any liabilities (except for
premium payments arising in the ordinary course of business) payable to the Pension Benefit
Guaranty Corporation under ERISA.

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     (w) Investment Company Act. The Borrower represents and warrants that the Borrower is
exempt and will remain exempt from registration as an “investment company” within the meaning of
the Investment Company Act of 1940, as amended (the “1940 Act”).

     (x) Government Regulations. The Borrower is not engaged in the business of extending
credit for the purpose of “purchasing” or “carrying” any “margin security,” as such terms are
defined in Regulation U of the Federal Reserve Board as now and from time to time hereafter in
effect (such securities being referred to herein as “Margin Stock”). The Borrower owns no
Margin Stock, and no portion of the proceeds of any Advance hereunder will be used, directly or
indirectly, for the purpose of purchasing or carrying any Margin Stock, for the purpose of reducing
or retiring any Indebtedness that was originally incurred to purchase or carry any Margin Stock or
for any other purpose that might cause any portion of such proceeds to be considered a “purpose
credit” within the meaning of Regulation T, U or X of the Federal Reserve Board. The Borrower will
not take or permit to be taken any action that might cause any Related Document to violate any
regulation of the Federal Reserve Board.

     (y) Eligibility of Loan Assets. (i) The information contained in the Schedule of Loan
Assets (in the case of the Closing Date), the information contained in the related Borrower Notice
(in the case of a Funding Date or other date on which a Borrower Notice is delivered hereunder) or
the information contained in the related Monthly Report (in the case of a Reporting Date), as
applicable, with respect to the identity of such Loan Assets and the amounts owing thereunder is
true and correct in all material respects as of the applicable date and (ii) each Loan Asset listed
thereon or otherwise included in the calculation of the Borrowing Base as an Eligible Loan Asset
satisfies the requirements in the definition of “Eligible Loan Asset” as of the applicable date.

     (z) USA PATRIOT Act. Neither the Borrower nor any Affiliate of the Borrower is (1) a
country, territory, organization, person or entity named on an OFAC list, (2) a Person that resides
or has a place of business in a country or territory named on such lists or which is designated as
a Non-Cooperative Jurisdiction by the Financial Action Task Force on Money Laundering (“FATF”), or
whose subscription funds are transferred from or through such a jurisdiction; (3) a “Foreign Shell
Bank” within the meaning of the USA PATRIOT Act, i.e., a foreign bank that does not have a physical
presence in any country and that is not affiliated with a bank that has a physical presence and an
acceptable level of regulation and supervision; or (4) a person or entity that resides in or is
organized under the laws of a jurisdiction designated by the United States Secretary of the
Treasury under Section 311 or 312 of the USA PATRIOT Act as warranting special measures due to
money laundering concerns.

     (aa) No Adverse Selection. Neither the Borrower nor any Affiliate of the Borrower has
utilized any selection procedures believed to be adverse to the Secured Parties in selecting the
Loan Assets included in the Collateral from time to time.

     (bb) Instructions to Obligors. The Collection Account is the only account to which
Obligors have been instructed by the Borrower, or the Manager on the Borrower’s behalf, to send
Principal Collections and Interest Collections on the Loan Assets. The Borrower has not granted any
Person other than the Administrative Agent, on behalf of the Secured Parties, an interest in the
Collection Account.

     (cc) No Set-Off, etc. No Loan Asset has been compromised, adjusted, extended,
satisfied, subordinated, rescinded, set-off or modified by the Borrower or the Obligor thereof, and
no Collateral is subject to compromise, adjustment, extension, satisfaction, subordination,
rescission, set-off, counterclaim, defense, abatement, suspension, deferment, deduction, reduction,
termination or modification, whether arising out of transactions concerning the Collateral or
otherwise, by the Borrower or the Obligor with respect thereto, except, in each case, for
amendments, extensions and modifications, if

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any, to such Collateral otherwise permitted pursuant to Section 7.6(h) and in
accordance with the Management Standards.

Section 4.2 Representations and Warranties of the Performance Guarantor. 

     The Performance Guarantor represents and warrants as of the Closing Date as follows:

     (a) Organization and Good Standing. The Performance Guarantor is a Maryland
corporation duly organized, validly existing, and in good standing under the laws of the
jurisdiction of its formation, and has full power, authority and legal right to own or lease its
properties and conduct its business as such business is presently conducted.

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

     (c) Due Authorization. The execution and delivery of this Agreement and each
Transaction Document to which the Performance Guarantor is a party and the consummation of the
transactions provided for herein and therein have been duly authorized by the Performance Guarantor
by all necessary action on the part of the Performance Guarantor.

     (d) No Conflict. The execution and delivery of this Agreement and each Transaction
Document to which the Performance Guarantor is a party, the performance by the Performance
Guarantor of the transactions contemplated hereby and thereby and the fulfillment of the terms
hereof and thereof will not conflict with or result in any breach of any of the terms and
provisions of, and will not constitute (with or without notice or lapse of time or both) a default
under, the Performance Guarantor’s articles of incorporation or bylaws or any material Contractual
Obligation of the Performance Guarantor.

     (e) No Violation. The execution and delivery of this Agreement and each Transaction
Document to which the Performance Guarantor is a party, the performance of the transactions
contemplated hereby and thereby and the fulfillment of the terms hereof and thereof will not
conflict with or violate any Applicable Law in a manner that could reasonably be expected to have a
Material Adverse Effect.

     (f) No Proceedings. There are no proceedings or investigations pending or, to the best
knowledge of the Performance Guarantor, threatened against the Performance Guarantor, before any
Governmental Authority (i) asserting the invalidity of this Agreement or any Transaction Document
to which the Performance Guarantor is a party, (ii) seeking to prevent the consummation of any of
the transactions contemplated by this Agreement or any Transaction Document to which the
Performance Guarantor is a party or (iii) that could reasonably be expected to have a Material
Adverse Effect.

     (g) All Consents Required. All material approvals, authorizations, consents, orders or
other actions of any Person or of any Governmental Authority (if any) required in connection with
the due

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execution, delivery and performance by the Performance Guarantor of this Agreement and any
Transaction Document to which the Performance Guarantor is a party, have been obtained.

     (h) Agreements Enforceable. This Agreement and each Transaction Document to which the
Performance Guarantor is a party constitute the legal, valid and binding obligation of the
Performance Guarantor enforceable against the Performance Guarantor in accordance with their
respective terms, except as such enforceability may be limited by Insolvency Laws and except as
such enforceability may be limited by general principles of equity (whether considered in a suit at
law or in equity).

ARTICLE V

GENERAL COVENANTS OF THE BORROWER

Section 5.1 Covenants of the Borrower.

     The Borrower hereby covenants that:

     (a) Compliance with Laws. The Borrower will comply with all Applicable Laws with
respect to it, its business and properties and all Collateral, except where the failure to do so,
individually or in the aggregate, could not reasonably be expected to have a Material Adverse
Effect.

     (b) Preservation of Existence. The Borrower will (i) preserve and maintain its
existence in good standing and its rights, franchises and privileges in the jurisdiction of its
formation, and (ii) qualify and remain qualified in good standing in each jurisdiction where the
failure to maintain such qualification has had, or could reasonably be expected to have, a Material
Adverse Effect.

     (c) Security Interests. Except as contemplated in this Agreement, the Borrower will
not sell, pledge, assign or transfer to any other Person, or grant, create, incur, assume or suffer
to exist any Lien on any Collateral (other than Permitted Liens). The Borrower will promptly notify
the Custodian and the Administrative Agent of the existence of any Lien on any Collateral (other
than Permitted Liens) once the Borrower obtains knowledge thereof and the Borrower shall defend the
right, title and interest of the Administrative Agent on behalf of the Secured Parties in, to and
under any Collateral, against all claims of third parties; provided, however, that
nothing in this Section 5.1(c) shall prevent or be deemed to prohibit the Borrower from
suffering to exist Permitted Liens upon any Collateral.

     (d) Delivery of Collections. The Borrower agrees to cause the delivery to the
Collection Account promptly (but in no event later than two (2) Business Days after receipt) all
Collections received by Borrower in respect of the Loan Assets that are part of the Collateral.

     (e) Activities of Borrower. The Borrower shall not engage in any business or activity
of any kind, or enter into any transaction or indenture, mortgage, instrument, agreement, contract,
loan or other undertaking, which is not incidental to the transactions contemplated and authorized
by this Agreement or, prior to the Closing Date, the Purchase Agreement or the Prior Credit
Agreement.

     (f) Indebtedness. The Borrower shall not create, incur, assume or suffer to exist any
Indebtedness or other liability whatsoever, except (i) obligations incurred under this Agreement,
under any Hedging Agreement required by Section 5.2(a), or the Purchase Agreement, or (ii)
liabilities incident to the maintenance of its existence in good standing.

     (g) Guarantees. The Borrower shall not become or remain liable, directly or
indirectly, in connection with any Indebtedness or other liability of any other Person, whether by
guarantee,

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endorsement (other than endorsements of negotiable instruments for deposit or collection in
the ordinary course of business), agreement to purchase or repurchase, agreement to supply or
advance funds, or otherwise.

     (h) Investments. The Borrower shall not make or suffer to exist any loans or advances
to, or extend any credit to, or make any investments (by way of transfer of property, contributions
to capital, purchase of stock or securities or evidences of indebtedness, acquisition of the
business or assets, or otherwise) in, any Person except for Loan Assets, the CLO Equity and
Supplemental Interests, or investments in Permitted Investments in accordance with the terms of
this Agreement.

     (i) Merger; Sales. The Borrower shall not enter into any transaction of merger or
consolidation, or liquidate or dissolve itself (or suffer any liquidation or dissolution), or
acquire or be acquired by any Person, or convey, sell, loan or otherwise dispose of all or
substantially all of its property or business, except as provided for in this Agreement.

     (j) Distributions. The Borrower may not declare or pay or make, directly or
indirectly, any distribution (whether in cash or other property) with respect to any Person’s
equity interest in the Borrower (collectively, a “Distribution”); provided,
however, if the following shall be true, both before and after giving effect to such
Distribution (A) the sum of Advances Outstanding plus the Unfunded Exposure Amount shall not exceed
the Facility Amount, (B) no Default or Event of Default shall have occurred and be continuing, and
(C) the Collateral Tests shall have been satisfied, the Borrower may make Distributions on any
Payment Date in accordance with Section 2.7.

     (k) Agreements. The Borrower shall not amend or modify the provisions of its limited
liability company agreement or its certificate of formation without the consent of the
Administrative Agent (except that the Borrower shall be permitted to amend such documents to change
its name to “Saratoga Investment Funding LLC” upon 2 Business Days prior written notice to the
Administrative Agent and delivery to the Administrative Agent of copies of all amendments thereto
promptly upon the effectiveness of such amendments), or issue any power of attorney except to the
Administrative Agent or the Manager.

     (l) Separate Existence. The Borrower shall:

     (i) At all times have at least one member of the board of directors of the Borrower who is
an Independent Director; provided that in the event of the death of an Independent Director, a
replacement Independent Director acceptable to the Administrative Agent shall be appointed
within 30 days of such event.

     (ii) Cause its operating agreement to provide that the directors of the Borrower shall not
approve, or take any other action to cause the filing of, a voluntary bankruptcy petition with
respect to the Borrower unless each Independent Director shall approve the taking of such action
in writing prior to the taking of such action.

     (iii) Maintain its own deposit account or accounts, separate from those of any Affiliate,
with commercial banking institutions. The funds of the Borrower will not be diverted to any
other Person or for other than corporate uses of the Borrower.

     (iv) Ensure that, to the extent that it shares the same persons as officers or other
employees as any of its Affiliates, the salaries of and the expenses related to providing
benefits to such officers or employees shall be fairly allocated among such entities, and each
such entity shall

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bear its fair share of the salary and benefit costs associated with all such common
officers and employees.

     (v) Ensure that, to the extent that it jointly contracts with any of its Affiliates to do
business with vendors or service providers or to share overhead expenses, the costs incurred in
so doing shall be allocated fairly among such entities, and each such entity shall bear its fair
share of such costs. To the extent that the Borrower contracts or does business with vendors or
service providers when the goods and services provided are partially for the benefit of any
other Person, the costs incurred in so doing shall be fairly allocated to or among such entities
for whose benefit the goods and services are provided, and each such entity shall bear its fair
share of such costs. All material transactions between Borrower and any of its Affiliates shall
be only on an arm’s length basis.

     (vi) Maintain a principal executive and administrative office through which its business is
conducted separate from those of its Affiliates (but such offices may be at the same location as
those of its Affiliates). To the extent that Borrower and any of its Affiliates have offices in
the same location, there shall be a fair and appropriate allocation of overhead costs among
them, and each such entity shall bear its fair share of such expenses.

     (vii) Conduct its affairs strictly in accordance with its limited liability company
agreement and observe all necessary, appropriate and customary legal formalities, including, but
not limited to, holding all regular and special director’s meetings appropriate to authorize all
action, keeping separate and accurate records of such meetings, passing all resolutions or
consents necessary to authorize actions taken or to be taken, and maintaining accurate and
separate books, records and accounts, including, but not limited to, payroll and transaction
accounts.

     (viii) Take or refrain from taking, as applicable, each of the activities specified or
assumed in the opinion of Mayer Brown LLP in respect of substantive consolidation matters, upon
which the conclusions expressed therein are based.

     (ix) Maintain the effectiveness of, and continue to perform under the Purchase Agreement
and the CLO Management Contribution Agreement, such that it does not amend, restate, supplement,
cancel, terminate or otherwise modify the Purchase Agreement or the CLO Management Contribution
Agreement, or give any consent, waiver, directive or approval thereunder or waive any default,
action, omission or breach under the Purchase Agreement or the CLO Management Contribution
Agreement or otherwise grant any indulgence thereunder, without (in each case) the prior written
consent of the Administrative Agent.

     (m) Change of Name or Jurisdiction of Borrower; Records. The Borrower (x) shall not
(except as expressly permitted by Section 5.1(k)) change its name or jurisdiction of
organization, without at least thirty (30) days’ prior written notice to the Administrative Agent
and (y) shall not move, or consent to the Manager or Custodian moving, the Loan Asset Documents
without at least thirty (30) days’ prior written notice to the Administrative Agent and (z) will
promptly take all actions required of each relevant jurisdiction in order to continue the first
priority perfected security interest of the Administrative Agent, for the benefit of the Secured
Parties (except for Permitted Liens) in all Collateral, and such other actions as the Custodian or
the Administrative Agent may reasonably request, including but not limited to delivery of an
Opinion of Counsel.

     (n) ERISA Matters. The Borrower will not, if individually or in the aggregate, the
following could reasonably be expected to have a Material Adverse Effect (a) engage or permit any
ERISA Affiliate to engage in any prohibited transaction for which an exemption is not available or
has not previously been

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obtained from the United States Department of Labor; (b) permit to exist any accumulated
funding deficiency, as defined in Section 302(a) of ERISA and Section 412(a) of the Code, or
funding deficiency with respect to any Benefit Plan other than a Multiemployer Plan; (c) fail to
make any payments to a Multiemployer Plan that the Borrower or any ERISA Affiliate may be required
to make under the agreement relating to such Multiemployer Plan or any law pertaining thereto; (d)
terminate any Benefit Plan so as to result in any liability; or (e) permit to exist any occurrence
of any reportable event described in Title IV of ERISA.

     (o) Transactions with Affiliates. The Borrower will not enter into, or be a party to,
any transaction with any of its Affiliates, except (i) the transactions permitted or contemplated
by this Agreement, the Purchase Agreement (solely in the case of the acquisition of Loan Assets
prior to the Closing Date), the CLO Management Contribution Agreement and any Hedging Agreements
and (ii) other transactions (including transactions related to the use of office space or computer
equipment or software by the Borrower to or from an Affiliate) (A) in the ordinary course of
business, (B) pursuant to the reasonable requirements of the Borrower’s business, (C) upon fair and
reasonable terms that are no less favorable to the Borrower than could be obtained in a comparable
arm’s-length transaction with a Person not an Affiliate of the Borrower, and (D) not inconsistent
with the factual assumptions set forth in the opinion of counsel of Mayer Brown LLP delivered on
the Closing Date, as such assumptions may be modified in any subsequent opinion letters delivered
to the Administrative Agent pursuant to Section 3.2 or otherwise. It is understood that any
compensation arrangement for any officer or employee shall be permitted under clause
(ii)(A) through (C) above if such arrangement has been expressly approved by the
directors of the Borrower in accordance with the Borrower’s limited liability company agreement.

     (p) Change in the Transaction Documents. The Borrower will not amend, modify, waive or
terminate any terms or conditions of any of the Transaction Documents to which it is a party,
without the prior written consent of Administrative Agent.

     (q) Extension or Amendment of Loan Assets. The Borrower will not extend, amend or
otherwise modify, or permit the Manager on its behalf to extend, amend or otherwise modify, the
terms of any Loan Asset in a manner inconsistent with the Management Standards, and in any case
will not amend or otherwise modify any Delayed Funding Loan Asset or other Eligible Loan Asset to
extend the maturity date thereof on any date following the end of the Revolving Period.

     (r) Subordination Events. The Borrower will not engage or permit any Affiliate to
engage in any activities relating to any Obligor and/or with respect to any Loan Asset that would
subject a Loan Asset to the risk of (i) equitable subordination under Section 510(c) of the
Bankruptcy Code, or (ii) recharacterization as an equity security under Section 105(a) of the
Bankruptcy Code or otherwise, as a result of the conduct of the Borrower, the Manager, the
Performance Guarantor or any of their respective Affiliates (items (i), and
(ii) above, each a “Subordination Event”); it being understood and agreed that a
restructuring of a Loan Asset, either in or out of court, may result in the Borrower holding equity
securities of an Obligor.

     (s) Compliance With Loan Asset Documents. The Borrower will act in conformity with all
material terms and conditions of the Loan Asset Documents, including the prompt enforcement of its
rights thereunder.

     (t) Investment. The Borrower shall use commercially reasonable efforts to facilitate
the acquisition and settlement of Loan Assets, and shall seek to obtain the best prices and
execution for all orders placed with respect to the Loan Assets, considering all reasonable
circumstances. The Borrower shall select all Eligible Loan Assets which shall be acquired or sold
by it in accordance with the criteria set forth herein, and in so doing shall take into
consideration, among other things, its payment obligations

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hereunder on each Payment Date, such that Scheduled Payments on the Loan Assets permit timely
performance of such payment obligations.

     (u) Arm’s Length Transaction. The Borrower shall cause any acquisition or sale or
other disposition of any Loan Asset to be conducted on an arm’s length basis and in accordance with
the terms of this Agreement.

Section 5.2 Hedging Agreement.

     (a) If a Hedge Trigger Period exists, the Borrower shall within 30 days of the occurrence of
such Hedge Trigger Period, enter into and maintain one or more Interest Rate Hedge Transactions,
which Interest Rate Hedge Transactions shall:

     (i) be entered into with a Hedge Counterparty and governed by a Hedging Agreement;

     (ii) have a notional amount and amortization schedule as shall be agreed upon by the
Borrower and the Administrative Agent, it being understood that such schedule shall be based on
the weighted average life of the applicable Fixed Rate Loan Assets; and

     (iii) shall provide for payments to the Borrower to the extent that the LIBOR Rate shall
exceed a rate agreed upon between the Hedge Counterparty and the Borrower (with the consent of
the Administrative Agent).

     (b) The Borrower shall, with regard to any Non-USD Loan Asset, enter into a Currency Hedge
Transaction, provided that each such Currency Hedge Transaction shall:

     (i) be entered into with a Hedge Counterparty, governed by a Hedging Agreement and approved
by the Administrative Agent;

     (ii) have a schedule of periodic quarterly calculation periods which settle on a Payment
Date, the first of which commences on the applicable Funding Date associated with such purchase,
and the last of which ends on the date of the last Scheduled Payment due to occur under the
Non-USD Loan Assets to which it relates;

     (iii) have (A) a notional amount denominated in the Approved Foreign Currency of the
related Non-USD Loan Asset (the “Non-USD Notional Amount”), (B) a notional amount
denominated in Dollars (the “USD Notional Amount”), (C) a floating payment relating to
the index applicable to such Non-USD Loan Asset payable by the Borrower, (D) a floating payment
relating to the LIBOR Rate payable by the Hedge Counterparty, and (E) a scheduled termination
date equal to the date which the Manager reasonably expects to be the scheduled final payment
date of such Non-USD Loan Asset or, at the option of the Manager, the date on which the average
life or duration for the Non-USD Loan Asset being hedged expires; and

     (iv) provide that (A)(x) the Borrower shall pay to the Hedge Counterparty, in the Approved
Foreign Currency in which the related Non-USD Loan Asset is denominated, a floating rate coupon
on the Non-USD Notional Amount of such Currency Hedge Transaction and (y) in exchange, the Hedge
Counterparty shall pay to the Borrower, in Dollars, a floating rate coupon on the USD Notional
Amount of such Currency Hedge Transaction; (B)(x) the Borrower shall pay to the Hedge
Counterparty, in the Permitted Currency in which the related Non-USD Loan Asset is denominated,
a specified portion of the Non-USD Notional Amount as a final principal exchange amount and (y)
in

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exchange, the Hedge Counterparty shall pay to the Borrower, in Dollars, a specified portion
of the USD Notional Amount as a final principal exchange amount; and

     (v) have a Non-USD Notional Amount equal to Outstanding Principal Balance of the Non-USD
Loan Asset being hedged;

     (c) As additional security hereunder, the Borrower hereby pledges to the Administrative Agent,
for the benefit of the Secured Parties, all right, title and interest of the Borrower in, but none
of the obligations of the Borrower under, any and all Hedging Agreements, any and all Hedge
Transactions, and any and all present and future amounts payable by a Hedge Counterparty to the
Borrower under or in connection with its respective Hedging Agreement and Hedge Transaction(s)
(collectively, the “Hedge Collateral”), and grants a security interest to the
Administrative Agent, for the benefit of the Secured Parties, in the Hedge Collateral. Nothing
herein shall have the effect of releasing the Borrower from any of its obligations under any
Hedging Agreement or any Hedge Transaction, nor be construed as requiring the consent of the
Custodian, the Administrative Agent or any Secured Party for the performance by the Borrower of any
such obligations.

Section 5.3 Accounts.

     (a) Establishment of the Collection Account. The Borrower or the Manager on its behalf
shall cause to be established, on or before the Closing Date, and maintained in the name of the
Borrower but subject to the Lien of the Administrative Agent on behalf of the Secured Parties, with
an office or branch of a depository institution or trust company organized under the laws of the
United States, which shall initially be U.S. Bank, or any one of the States thereof or the District
of Columbia (or any domestic branch of a foreign bank) a segregated corporate trust account, which
may be a securities account or a deposit account (the “Collection Account”) for the purpose
of receiving Collections from the Collateral; provided, however, that such
depository institution or trust company shall be a depository institution organized under the laws
of the United States or any one of the States thereof or the District of Columbia (or any domestic
branch of a foreign bank), (i) (A) that has either (1) a long-term unsecured debt rating of A- or
better by S&P and A-3 or better by Moody’s or (2) a short-term unsecured debt rating or certificate
of deposit rating of A-1 or better by S&P or P-1 or better by Moody’s, (B) the parent corporation
of which has either (1) a long- term unsecured debt rating of A- or better by S&P and A-3 or better
by Moody’s or (2) a short- term unsecured debt rating or certificate of deposit rating of A-1 or
better by S&P and P-1 or better by Moody’s or (C) is otherwise acceptable to the Administrative
Agent and (ii) whose deposits are insured by the Federal Deposit Insurance Corporation (any such
depository institution or trust company, a “Qualified Institution”) which Qualified
Institution has agreed with the Borrower, the Manager and the Administrative Agent to comply with
any and all written orders, notices, requests and other instructions originated by the
Administrative Agent directing disposition of the funds in the Collection Account and any and all
entitlement orders originated by the Administrative Agent with respect to financial assets credited
to the Collection Account, without any further consent from the Borrower or the Manager. In order
to provide the Administrative Agent with control over the Collection Account within the meaning of
Section 9-104(a) or Section 9-106(c) of the UCC and any other Applicable Law, the Borrower and the
Manager hereby agree that the Administrative Agent may at any time provide U.S. Bank or any
successor Person that maintains the Collection Account with written instructions as to the
disposition of funds in the Collection Account, entitlement orders with respect to financial assets
in the Collection Account or written instructions as to any other matters relating to the
Collection Account without any further consent from the Borrower or the Manager; provided,
further, that if such depository institution at any time fails to be a Qualified
Institution, the Borrower, or the Manager on behalf of the Borrower, shall cause the Controlled
Accounts to be established with an office or branch of another depository institution or trust
company organized under the laws of the United States or any one of the States thereof or the
District of Columbia (or any domestic branch of a foreign bank) meeting

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the requirements of a Qualified Institution within 30 days of the Borrower’s or the Manager’s
acquiring knowledge of such failure.

     (b) U.S. Bank, to the extent and for so long as the Collection Account is maintained with it,
agrees with the Borrower, the Manager and the Administrative Agent to comply with any and all
written orders, entitlement orders, notices, requests and other instructions originated by the
Administrative Agent directing disposition of the funds or financial assets in the Collection
Account without any further consent from the Borrower or the Manager. Subject in every respect to
the foregoing, U.S. Bank and any successor Person that maintains the Collection Account shall only
comply with such written orders, notices, requests, entitlement orders and other instructions
originated by the Borrower or the Manager as the Borrower or the Manager shall expressly deliver
and cause U.S. Bank to effectuate pursuant to the terms of the Transaction Documents, it being
understood and acknowledged that neither the Borrower nor the Manager shall give any written
orders, notices, requests, entitlement orders or instructions not authorized or permitted by the
Transaction Documents. None of the Administrative Agent nor any other Secured Party shall issue a
Notice of Exclusive Control (as defined in the Account Control Agreement), or any entitlement
orders or other written instructions to U.S. Bank (or any successor Person that then maintains the
Collection Account) unless an Event of Default has occurred and is continuing; provided that none
of the Performance Guarantor, the Manager or the Borrower shall have any right of withdrawal over
the Collection Account (including any subaccounts thereof) except in accordance with Sections
2.3 and 2.7.

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

     (d) Establishment of Reserve Account. The Borrower or the Manager on its behalf shall
cause to be established, on or before the Closing Date, and maintained in the name of the Borrower
but under the control of the Administrative Agent or the benefit of the Secured Parties with an
office or branch of a Qualified Institution, which shall initially be U.S. Bank, a segregated
corporate trust account, which may be a securities account or a deposit account (the “Reserve
Account”); provided that at all times such depository institution or trust company shall be a
Qualified Institution. On any Business Day preceding a Payment Date, if the amounts on deposit in
the Collection Amount are insufficient to make the payments required by Section
2.7(a)(v) or 2.7(b)(v) as applicable, the Manager or the Administrative Agent,
as applicable, shall transfer from the Reserve Account to the Collection Account the lesser of (i)
the additional amount necessary to make such payments or (ii) the amount on deposit in the Reserve
Account. Upon the occurrence and during the continuation of an Event of Default, the Administrative
Agent may, and shall, at the direction of the Required Lenders, direct the Account Bank or the
Manager, as applicable, to withdraw all remaining amounts on deposit in the Reserve Account and
apply them as Principal Collections in accordance with Section 2.7(c) hereof.

     (e) Establishment of Unfunded Exposure Account. The Borrower or the Manager on its
behalf shall cause to be established, on or before the Closing Date, and maintained in the name of
the Borrower but under the control of the Administrative Agent for the benefit of the Secured
Parties with an office or branch of a Qualified Institution, which shall initially be U.S. Bank, a
segregated corporate trust account, which may be a securities account or a deposit account (the
“Unfunded Exposure Account”); provided that at all times such depository institution or
trust company shall be a Qualified Institution.

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Amounts on deposit in the Unfunded Exposure Account may be withdrawn to fund Unfunded Exposure
Amounts in accordance with Section 2.7(e).

Section 5.4 Delivery of Loan Asset Files.

     (a) The Borrower, or the Manager on its behalf, shall deliver possession of all “instruments”
(within the meaning of Article 9 of the UCC) not constituting part of “chattel paper” (within the
meaning of Article 9 of the UCC) that evidence any Loan Asset being transferred and set forth on a
Schedule of Loan Assets, including all Underlying Notes (other than in the case of Noteless Loan
Assets), and all portions of the Loan Asset Files to the Custodian on behalf of the Secured Parties
within five Business Days of the applicable Funding Date, in each case endorsed in blank or to the
Administrative Agent, without recourse. Pursuant to Section 7.13, the Borrower is required
to deliver such instruments and Loan Asset Files to the Custodian for the benefit of the Secured
Parties. Accordingly, the Borrower hereby authorizes and directs the Manager to deliver possession
of all such instruments and Loan Asset Files to the Custodian on behalf of the Secured Parties, and
agrees that such delivery shall satisfy the condition set forth in the first sentence of this
Section 5.4(a). The Manager shall also identify on the Schedule of Loan Assets (including
any amendment thereof), whether by attached schedule or marking or other effective identifying
designation, all Loan Assets being transferred that are not evidenced by such instruments.

     (b) The Borrower, or the Manager on its behalf, shall deliver possession of all certificated
“investment property” (within the meaning of Article 9 of the UCC) that evidences any CLO Equity or
Supplemental Interests being transferred and set forth on a Schedule of Loan Assets to the
Custodian on behalf of the Secured Parties within five Business Days of the date on which such
items of Collateral are acquired, in each case endorsed in blank or to the Administrative Agent,
without recourse. Pursuant to Section 7.15, the Borrower is required to deliver such
instruments to the Custodian for the benefit of the Secured Parties. Accordingly, the Borrower
hereby authorizes and directs the Manager to deliver possession of all such instruments to the
Custodian on behalf of the Secured Parties, and agrees that such delivery shall satisfy the
condition set forth in the first sentence of this Section 5.4(b). The Manager shall also
identify on the Schedule of Loan Assets (including any amendment thereof), whether by attached
schedule or marking or other effective identifying designation, all such items of Collateral being
transferred that are not issued in certificated form.

     (c) Prior to the occurrence of an Event of Default, the Custodian shall not record the
Assignments of Mortgage delivered pursuant to Section 5.4(a) and the definition of Loan
Asset Documents. Upon the occurrence of an Event of Default, the Custodian shall, if so directed
in writing by the Administrative Agent, cause to be recorded in the appropriate offices each
Assignment of Mortgage delivered to it with respect to all Loan Assets being transferred. Each such
recording shall be at the expense of the Borrower; provided, that to the extent the
Borrower does not pay such expenses, the Custodian shall be reimbursed pursuant to the provisions
of Section 2.7.

ARTICLE VI

SECURITY INTEREST

Section 6.1 Security Interest.

     As collateral security for the prompt, complete and indefeasible payment and performance in
full when due, whether by lapse of time, acceleration or otherwise, of the Facility Obligations,
the Borrower hereby assigns, pledges and grants to the Administrative Agent, for the benefit of the
Secured Parties, a lien on and security interest in all of the Borrower’s right, title and interest
in, to and under (but none of its obligations under) the Collateral, whether now existing or owned
or hereafter arising or acquired by

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the Borrower, and wherever located. The assignment under this Section 6.1 does not
constitute and is not intended to result in a creation or an assumption by the Administrative
Agent, the Custodian or any of the Secured Parties of any obligation or duty of the Borrower or any
other Person in connection with any or all of the Collateral or under any agreement or instrument
relating thereto. Anything herein to the contrary notwithstanding, (a) the Borrower shall remain
liable under the Loan Assets to the extent set forth therein to perform all of its duties and
obligations thereunder to the same extent as if this Agreement had not been executed, (b) the
exercise by the Administrative Agent, for the benefit of the Secured Parties, of any of its rights
in the Collateral shall not release the Borrower from any of its duties or obligations under the
Collateral, and (c) none of the Administrative Agent, the Custodian or any Secured Party shall have
any obligations or liability under the Collateral by reason of this Agreement, nor shall the
Administrative Agent or any Secured Party be obligated to perform any of the obligations or duties
of the Borrower thereunder or to take any action to collect or enforce any claim for payment
assigned hereunder. The Borrower hereby authorizes the Administrative Agent to file an “all assets”
financing statement against it which covers all of its personal property.

Section 6.2 Remedies.

     The Administrative Agent, for the benefit of the Secured Parties, shall have all of the rights
and remedies of a secured party under the UCC and other Applicable Law. Upon the occurrence and
during the continuance of an Event of Default, the Administrative Agent or its designees may (i)
deliver a notice of exclusive control to the Account Bank; (ii) instruct the Custodian in writing
to deliver any or all of the Collateral to the Administrative Agent or its designees and otherwise
give all instructions and entitlement orders to the Account Bank and the Custodian regarding the
Collateral; (iii) require that the Borrower or the Custodian immediately take action to liquidate
the Collateral to pay amounts due and payable in respect of the Facility Obligations; (iv) sell or
direct the Custodian in writing to sell or otherwise dispose of the Collateral in a commercially
reasonable manner, all without judicial process or proceedings; (v) take control of the Proceeds of
any such Collateral; (vi) exercise or direct the Custodian in writing to exercise any consensual or
voting rights in respect of the Collateral; (vii) release, make extensions, discharges, exchanges
or substitutions for, or surrender all or any part of the Collateral or direct the Custodian in
writing to do so; (viii) enforce the Borrower’s rights and remedies with respect to the Collateral;
(ix) institute and prosecute legal and equitable proceedings to enforce collection of, or realize
upon, any of the Collateral; (x) remove from the Borrower’s, the Manager’s, the Custodian’s and
their respective agents’ place of business copies of all books, records and documents relating to
the Collateral and, in the case of the Loan Asset Documents themselves, the originals of any such
Loan Asset Documents not held by the Custodian on behalf of the Administrative Agent; and/or (xi)
endorse or direct the Custodian in writing to endorse the name of the Borrower upon any items of
payment relating to the Collateral or upon any proof of claim in bankruptcy against an account
debtor.

     For purposes of taking the actions described in subsections (i) through (xi)
of this Section 6.2 the Borrower hereby irrevocably appoints the Administrative Agent as
its attorney-in-fact (which appointment being coupled with an interest is irrevocable while any of
the Facility Obligations remain unpaid), with power of substitution, in the name of the
Administrative Agent or in the name of the Borrower or otherwise, for the use and benefit of the
Administrative Agent, but at the cost and expense of the Borrower and without notice to the
Borrower; provided that the Administrative Agent hereby agrees to exercise such power only so long
as an Event of Default shall be continuing.

Section 6.3 Release of Liens.

     (a) At the same time as any Loan Asset that is part of the Collateral matures or expires by
its terms and all amounts in respect thereof have been paid by the related Obligor and deposited in
the Collection Account, the Administrative Agent and the Custodian, on behalf of the Secured
Parties, shall

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be deemed to have automatically released its interest in such Loan Asset without any further
action on its part. In connection with any such release on or after the occurrence of the above,
the Administrative Agent or the Custodian (as directed in writing), on behalf of the Secured
Parties, will execute and deliver to the Borrower or the Manager on behalf of the Borrower any
termination statements and any other releases and instruments as the Borrower or the Manager on
behalf of the Borrower may reasonably request in order to effect the release of such Loan Asset;
provided, that, neither the Administrative Agent nor the Custodian, on behalf of
the Secured Parties, shall be required to make any representation or warranty, express or implied,
with respect to any such Loan Asset in connection with such sale or transfer and assignment.

     (b) Upon any request for a release of certain Loan Assets in connection with a proposed
Discretionary Sale, if, upon application of the proceeds of such transaction in accordance with
Section 2.7, the conditions set forth in Sections 2.14(a) and (b) are
satisfied, the Administrative Agent, on behalf of the Secured Parties will, to the extent requested
by the Borrower or the Manager on behalf of the Borrower, release its interest in such Loan Asset.
In connection with any such release on or after the occurrence of the above, the Administrative
Agent or the Custodian (as directed in writing), on behalf of the Secured Parties, will execute and
deliver to the Borrower or the Manager on behalf of the Borrower any termination statements and any
other releases and instruments as the Borrower or the Manager on behalf of the Borrower may
reasonably request in order to effect the release of such Loan Asset; provided,
that, neither the Administrative Agent nor the Custodian, on behalf of the Secured Parties,
shall be required to make any representation or warranty, express or implied, with respect to any
such Loan Asset in connection with such sale or transfer and assignment.

     (c) Upon receipt by the Custodian of the Proceeds of a repurchase of an Ineligible Collateral
Debt Obligation (as such term is defined in the Purchase Agreement) by the Performance Guarantor
pursuant to the terms of Section 6.1 of the Purchase Agreement, the Administrative Agent, on behalf
of the Secured Parties, shall be deemed to have automatically released its interest in such
Ineligible Loan Asset without any further action on its part. In connection with any such release
on or after the occurrence of such repurchase, the Administrative Agent or the Custodian (as
directed in writing), on behalf of the Secured Parties, will execute and deliver to the Borrower or
the Manager on behalf of the Borrower any releases and instruments as the Borrower or the Manager
on behalf of the Borrower may reasonably request in order to effect the release of such Ineligible
Loan Asset.

Section 6.4 Assignment of the Purchase Agreement and CLO Management Contribution Agreement.

     The Borrower hereby represents, warrants and confirms to the Administrative Agent that the
Borrower has assigned to the Administrative Agent, for the ratable benefit of the Secured Parties
hereunder, all of the Borrower’s right and title to and interest in the Purchase Agreement and the
CLO Management Contribution Agreement. The Borrower confirms that following an Event of Default the
Administrative Agent shall have the sole right to enforce the Borrower’s rights and remedies under
the Purchase Agreement and the CLO Management Contribution Agreement for the benefit of the Secured
Parties, but without any obligation on the part of the Administrative Agent, the Custodian, the
Secured Parties or any of their respective Affiliates to perform any of the obligations of the
Borrower under the Purchase Agreement and the CLO Management Contribution Agreement. The Borrower
further confirms and agrees that such assignment to the Administrative agent shall terminate upon
the Collection Date; provided, however, that the rights of the Administrative Agent
and the Secured Parties pursuant to such assignment with respect to rights and remedies in
connection with any indemnities and any breach of any representation, warranty or covenants made by
the Performance Guarantor pursuant to the Purchase Agreement and the CLO Management Contribution
Agreement, which rights and remedies survive the

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Termination of the Purchase Agreement and the CLO Management Contribution Agreement, as
applicable, shall be continuing and shall survive any termination of such assignment.

ARTICLE VII

ADMINISTRATION, SERVICING AND MANAGEMENT OF LOAN ASSETS

Section 7.1 Appointment of the Manager.

     The Borrower hereby appoints the Manager to service the Loan Assets and enforce its respective
rights and interests in and under each Loan Asset in accordance with the terms and conditions of
this Article VII. The Manager hereby agrees to perform the duties and obligations with
respect thereto set forth herein; provided that, notwithstanding anything contained in this
Agreement or any other Transaction Document to the contrary, upon the occurrence and during the
continuance of an Event of Default, the Manager shall not be permitted to exercise any rights with
respect to any Loan Asset or other Collateral (including the granting of any consents or
modifications with respect thereto) without the prior written consent of the Administrative Agent.

Section 7.2 Duties and Responsibilities of the Manager.

     (a) The Manager shall conduct the servicing, administration and collection of the Loan Assets
and shall take, or cause to be taken, all such actions as may be necessary or advisable to manage,
service, administer and collect Loan Assets from time to time on behalf of the Borrower and as the
Borrower’s agent.

     (b) The duties of the Manager, as the Borrower’s agent, shall include, without limitation (in
each case subject to and in accordance with the provisions of this Agreement):

     (i) supervising the Loan Assets and the other Collateral, including communicating with
Obligors, providing consents and waivers, enforcing and collecting on the Loan Assets and other
Collateral and otherwise managing the Collateral on behalf of the Borrower;

     (ii) maintaining all necessary Loan Asset Records with respect to the Loan Assets and
providing such reports to the Borrower and the Administrative Agent in respect of the management
of the Loan Assets (including information relating to its performance under this Agreement) as
may be required hereunder or as the Borrower or the Administrative Agent may reasonably request;

     (iii) maintaining and implementing administrative and operating procedures (including an
ability to recreate Loan Asset Records evidencing the Loan Assets in the event of the
destruction of the originals thereof) and keeping and maintaining all documents, books, records
and other information reasonably necessary or advisable for the collection of the Loan Assets
(including records adequate to permit the identification of each new Loan Asset and all
Collections of and adjustments to each existing Loan Asset); provided, however,
that any Successor Manager shall only be required to recreate the Loan Asset Records of each
prior Manager to the extent such records have been delivered to it in a format reasonably
acceptable to such Successor Manager;

     (iv) promptly delivering to the Borrower, the Custodian or the Administrative Agent, from
time to time, such information and Loan Asset Records (including information relating to its
performance under this Agreement) as the Borrower, the Custodian or the Administrative Agent
from time to time reasonably request;

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     (v) identifying each Loan Asset clearly and unambiguously in its Loan Asset Records to
reflect that such Loan Asset is owned by the Borrower and pledged to the Custodian for the
benefit of the Secured Parties;

     (vi) complying in all material respects with the Management Standards and the Investment
Guidelines in regard to each Loan Asset;

     (vii) complying with all Applicable Laws with respect to it, its business and properties
and all Collateral, except where failure to do so, individually or in the aggregate, could not
reasonably be expected to have a Material Adverse Effect;

     (viii) preserving and maintaining its existence, rights, licenses, franchises and
privileges as a limited liability company in the jurisdiction of its organization, and
qualifying and remaining qualified in good standing as a foreign limited liability company and
qualifying to and remaining authorized and licensed to perform obligations as Manager (including
enforcement of collection of Loan Assets on behalf of the Borrower, Lenders, each Hedge
Counterparty and the Custodian) in each jurisdiction where the failure to preserve and maintain
such existence, rights, franchises, privileges and qualification would materially adversely
affect (A) the rights or interests of the Borrower, Lenders, each Hedge Counterparty and the
Custodian in the Loan Assets, (B) the collectibility of any Loan Asset, or (C) the ability of
the Manager to perform its obligations hereunder; and

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

     (x) directing the Custodian to make payments pursuant to the terms of the Monthly Report in
accordance with Section 2.7;

     (xi) directing the sale or substitution of Loan Assets in accordance with Sections
2.4 and 2.14;

     (xii) providing administrative assistance to the Borrower with respect to the purchase and
sale of and payment for the Loan Assets;

     (xiii) instructing the Obligors and the administrative agents on the Loan Assets to make
payments directly into the Collection Account;

     (xiv) delivering the Loan Asset Files and the Schedule of Loan Assets to the Custodian;

     (xv) exercising any other rights or remedies with respect to such Loan Assets as provided
in the related Loan Asset Documents, including any exercise of creditor rights or sitting on any
creditors’ committee, or taking any other action consistent with the terms of this Agreement
which it believes to be in the best interests of the Borrower and the Lenders; and

     (xvi) complying with such other duties and responsibilities as may be required of the
Manager by this Agreement.

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It is acknowledged and agreed that in circumstances in which a Person other than the Borrower or
the Manager acts as lead agent with respect to any Loan Asset, the Manager shall perform its
management and servicing duties hereunder only to the extent a lender under the related Loan Asset
Documents has the right to do so. Notwithstanding anything to the contrary contained herein, it is
acknowledged and agreed that the performance by the Manager of its duties hereunder shall be
limited insofar as such performance would conflict with or result in a breach of any of the express
terms of the related Loan Asset Documents; provided that the Manager shall (a) provide
prompt written notice to the Administrative Agent upon becoming aware of such conflict or breach,
(b) have determined that there is no other commercially reasonable performance that it could render
consistent with the express terms of the Loan Asset Documents which would result in all or a
portion of the servicing duties being performed in accordance with this Agreement, and (c)
undertake all commercially reasonable efforts to mitigate the effects of such non-performance
including performing as much of the servicing duties as possible and performing such other
commercially reasonable and/or similar duties consistent with the terms of the Loan Asset
Documents.

     (c) The Borrower and Manager hereby acknowledge that the Secured Parties, the Administrative
Agent and the Custodian shall not have any obligation or liability with respect to any Loan Assets,
nor shall any of them be obligated to perform any of the obligations of the Manager hereunder.

Section 7.3 Authorization of the Manager.

     (a) Each of the Borrower, each Lender, the Administrative Agent, the Custodian and each Hedge
Counterparty hereby authorizes the Manager (including any successor thereto) to take any and all
reasonable steps in its name and on its behalf necessary or desirable and not inconsistent with the
pledge of the Collateral to the Administrative Agent, on behalf of the Secured Parties, to collect
all amounts due under any and all Loan Assets, including endorsing any of their names on checks and
other instruments representing Collections, executing and delivering any and all instruments of
satisfaction or cancellation, or of partial or full release or discharge, and all other comparable
instruments, with respect to the Loan Assets and, after the delinquency of any Loan Asset and to
the extent permitted under and in compliance with Applicable Law, to commence proceedings with
respect to enforcing payment thereof, to the same extent as the Borrower could do. The Borrower
shall furnish the Manager (and any successors thereto) with any powers of attorney and other
documents necessary or appropriate to enable the Manager to carry out its servicing and
administrative duties hereunder, and shall cooperate with the Manager to the fullest extent in
order to ensure the collectibility of the Loan Assets. In no event shall the Manager be entitled to
make the Borrower, any Lender, any Hedge Counterparty, the Custodian or the Administrative Agent a
party to any litigation without such party’s express prior written consent, or to make the Borrower
a party to any litigation (other than any routine foreclosure or similar collection procedure)
without such Person’s and the Administrative Agent’s consent.

     (b) After an Event of Default has occurred and is continuing, at the Administrative Agent’s
direction, the Manager shall take such action as the Administrative Agent may deem necessary or
advisable to enforce collection of the Loan Assets; provided, however, that the
Administrative Agent may, at any time that an Event of Default has occurred and is continuing,
notify any Obligor with respect to any Loan Assets of the assignment of such Loan Assets to the
Administrative Agent and direct that payments of all amounts due or to become due to the Borrower
thereunder be made directly to the Administrative Agent or any manager, servicer, collection agent
or lock-box or other account designated by the Administrative Agent and, upon such notification and
at the expense of the Borrower, the Administrative Agent may enforce collection of any such Loan
Assets and adjust, settle or compromise the amount or payment thereof. The Administrative Agent
shall give written notice to any Successor Manager of the Administrative Agent’s actions or
directions pursuant to this Section 7.3(b).

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Section 7.4 Collection of Payments.

     (a) Collection Efforts, Modification of Loan Assets. The Manager will make reasonable
efforts to collect all payments called for under the terms and provisions of the Loan Assets as and
when the same become due, and will follow its Management Standards. The Manager will use
reasonable efforts to maximize collections with respect to a Defaulted Loan Asset. The Manager may
not waive, modify or otherwise vary any provision of a Loan Asset, except as may be done in
accordance with the Management Standards and, in the case of a waiver or modification which
constitutes a Material Modification, except with the prior written consent of the Administrative
Agent.

     (b) Remedies under Loan Asset Documents. The Manager may, and shall (to the extent it
is permitted to do so under the related Loan Asset Documents), at the direction of the
Administrative Agent following an Event of Default, vote the Borrower’s interests under the
applicable Loan Asset Documents in respect of any rights and remedies, including voting to
accelerate the maturity of all or any Scheduled Payments under any Loan Asset under which a default
under the terms thereof has occurred and is continuing (after the lapse of any applicable grace
period) promptly after such Loan Asset becomes a Defaulted Loan Asset or such earlier or later time
as is consistent with the Management Standards.

Section 7.5 Representations and Warranties of the Manager.

     The Manager, and any Successor Manager (mutatis mutandis), hereby represents and warrants as
follows:

     (a) Organization and Good Standing. The Manager is a limited liability company duly
organized, validly existing and in good standing under the laws of the jurisdiction of its
organization with all requisite power and authority to own its properties and to conduct its
business as presently conducted and to enter into and perform its obligations pursuant to this
Agreement.

     (b) Due Qualification. The Manager is qualified to do business as a limited liability
company, is in good standing, and has obtained all licenses and approvals as required under the
laws of all jurisdictions in which the ownership or lease of its property and or the conduct of its
business (other than the performance of its obligations hereunder) requires such qualification,
standing, license or approval, except to the extent that the failure to so qualify, maintain such
standing or be so licensed or approved would not have a Material Adverse Effect. The Manager is
qualified to do business as a limited liability company, is in good standing, and has obtained all
licenses and approvals as required under the laws of all states in which the performance of its
obligations pursuant to this Agreement requires such qualification, standing, license or approval.

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

     (d) No Violation. The consummation of the transactions contemplated by, and the
fulfillment of the terms of, this Agreement by the Manager (with or without notice or lapse of
time) will not (i) conflict with, result in any breach of any of the terms or provisions of, or
constitute a default under, the certificate of formation or operating agreement of the Manager, or
any Contractual Obligation to which the Manager is a party or by which it or any of its property is
bound, (ii) result in the creation or imposition of any Adverse Claim upon any of its properties
pursuant to the terms of any such Contractual Obligation (other than this Agreement), or (iii)
violate any Applicable Law in a manner that could reasonably be expected to have a Material Adverse
Effect.

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

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

     (g) No Proceeding. There are no proceedings or investigations pending or threatened
against the Manager, before any Governmental Authority (i) asserting the invalidity of this
Agreement, (ii) seeking to prevent the consummation of any of the transactions contemplated by this
Agreement or (iii) seeking any determination or ruling that could reasonably be expected to have a
Material Adverse Effect.

     (h) Reports Accurate. If prepared by the Borrower, or the Manager on its behalf, or to
the extent that the information contained therein is supplied by the Manager, all Manager’s
Certificates, Monthly Reports, information, exhibits, financial statements, documents, books,
records or other reports furnished or to be furnished by the Manager to the Custodian, the
Administrative Agent or a Lender in connection with this Agreement are and will be accurate, true
and correct in all material respects.

     (i) No Event of Default. No event has occurred and is continuing and no condition
exists, or would result from the inclusion of any Loan Asset in the Collateral or from the
application of the proceeds therefrom, which constitutes or may reasonably be expected to
constitute a Default or Event of Default.

     (j) No Adverse Selection. The Manager has not utilized any selection procedures
believed to be adverse to the Secured Parties in exercising its powers to acquire and dispose of
the Loan Assets from time to time pursuant to Section 7.2.

Section 7.6 Covenants of the Manager.

     The Manager hereby covenants that:

     (a) Compliance with Law. The Manager will comply with all Applicable Laws with respect
to it, its business and properties and all Collateral, except where the failure to do so,
individually or in the aggregate, could not reasonably be expected to have a Material Adverse
Effect.

     (b) Preservation of Existence. The Manager will (i) preserve and maintain its limited
liability company existence in good standing and rights, franchises and privileges in the
jurisdiction of its formation, and (ii) qualify and remain qualified in good standing as a foreign
limited liability company in each jurisdiction where the failure to maintain such qualification has
had, or could reasonably be expected to have, a Material Adverse Effect.

     (c) Obligations with Respect to Loan Assets. The Manager will take any actions,
consistent with its Management Standards, which are required to ensure the Borrower shall duly
fulfill and comply with all material obligations on the part of the Borrower to be fulfilled or
complied with under or in connection with each Loan Asset and will do nothing to impair the rights
of the Borrower or the Administrative Agent, for the benefit of the Secured Parties, or of the
Secured Parties in, to and under the Collateral.

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     (d) Preservation of Security Interest. The Manager on behalf of the Borrower will
execute and file (or cause the execution and filing of) such financing and continuation statements
and any other documents that may be required by any law or regulation of any Governmental Authority
to preserve and protect fully the interest of the Administrative Agent, for the benefit of the
Secured Parties in, to and under the Collateral.

     (e) Change of Name or Jurisdiction; Records. The Manager shall not move, or consent to
the Custodian moving, the Loan Asset Documents relating to the Loan Assets without thirty (30)
days’ prior written notice to the Borrower, the Custodian and the Administrative Agent and, in
either case, will promptly take all actions required of each relevant jurisdiction in order to
continue the first priority perfected security interest of the Administrative Agent, for the
benefit of the Secured Parties, on all collateral, and such other actions as the Custodian or the
Administrative Agent may reasonably request, including but not limited to delivery of an Opinion of
Counsel.

     (f) Management Standards; Investment Guidelines. The Manager will comply in all
material respects with the Management Standards in regard to each Loan Asset. The Manager will not
modify or waive compliance with the Investment Guidelines without the prior written consent of the
Administrative Agent.

     (g) Events of Default. The Manager will furnish to the Administrative Agent, as soon
as possible and in any event within three (3) Business Days after the occurrence of each Event of
Default or Default, a written statement setting forth the details of such event and the action that
the Manager proposes to take with respect thereto.

     (h) Extension or Amendment of Loan Assets. The Manager will not, except as otherwise
permitted hereunder, agree, on behalf of the Borrower, to extend, amend or otherwise modify the
terms of any Loan Asset in a manner inconsistent with the Management Standards, and in any case
will not amend or otherwise modify any Eligible Loan Asset to extend the maturity date thereof on
any date following the end of the Revolving Period.

     (i) Other. The Manager will furnish to the Borrower, the Custodian and the
Administrative Agent such other information, documents records or reports respecting the Loan
Assets or the condition or operations, financial or otherwise, of the Manager that are in the
Manager’s possession, as the Borrower, the Custodian or the Administrative Agent may from time to
time reasonably request in order to protect the respective interests of the Borrower, the
Custodian, the Administrative Agent or the Secured Parties under or as contemplated by this
Agreement.

     (j) Subordination Events. The Manager will not engage in any activities relating to
any Obligor and/or with respect to any Loan Asset that would subject a Loan Asset to the risk of a
Subordination Event.

     (k) Compliance With Loan Asset Documents. The Manager will, on behalf of the Borrower,
act and cause the Borrower to act in conformity with all material terms and conditions of the Loan
Asset Documents, including the prompt enforcement of the Borrower’s rights thereunder.

     (l) Investment. The Manager shall use commercially reasonable efforts to facilitate
the acquisition and settlement of Loan Assets, and shall seek to obtain the best prices and
execution for all orders placed with respect to the Loan Assets, considering all reasonable
circumstances. The Manager shall select all Eligible Loan Assets which shall be acquired or sold by
it in accordance with the criteria set forth herein, and in so doing shall take into consideration,
among other things, its payment obligations

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hereunder on each Payment Date, such that Scheduled Payments on the Loan Assets permit timely
performance of such payment obligations.

     (m) Arm’s Length Transaction. The Manager shall cause any acquisition or sale or other
disposition of any Loan Asset to be conducted on an arm’s length basis and in accordance with the
terms of this Agreement.

Section 7.7 Payment of Certain Expenses by Manager.

     The Manager, so long as it shall be an Affiliate of the Borrower, will be required to pay all
expenses incurred by it in connection with its activities under this Agreement, including fees and
disbursements of legal counsel and independent accountants, Taxes imposed on the Manager, expenses
incurred in connection with payments and reports pursuant to this Agreement, and all other fees and
expenses not expressly stated under this Agreement for the account of the Borrower. The Borrower
shall, subject to Section 2.7, reimburse the Manager for the foregoing expenses incurred by
it in connection with its obligations hereunder.

Section 7.8 Reports.

     The Manager will provide all reports, certificates and other documentation required to enable
the Borrower to satisfy its reporting obligations hereunder and under the other Transaction
Documents, including the requirements of Section 7.10, as and when such reports,
certificates or other documentation are required hereunder or thereunder.

Section 7.9 The Manager Not to Resign.

     The Manager, so long as it shall be an Affiliate of the Borrower, shall not resign from the
obligations and duties hereby imposed on it except upon its determination that (i) the performance
of its duties hereunder is or becomes impermissible under Applicable Law and (ii) there is no
reasonable action that it could take to make the performance of its duties hereunder permissible
under Applicable Law. Any such determination permitting the resignation of the Manager shall be
evidenced as to clause (i) above by an Opinion of Counsel to such effect delivered to the
Borrower and the Administrative Agent. No such resignation shall become effective until a successor
manager acceptable to the Administrative Agent (a “Successor Manager”) shall have assumed
the responsibilities and obligations of the Manager hereunder.

Section 7.10 Reporting; Access to Certain Documentation and Information Regarding the Loan Assets.

     (a) Reporting. The Borrower, or the Manager on behalf of the Borrower, will furnish to
the Administrative Agent and the Custodian:

     (i) as soon as possible and in any event within three (3) Business Days after the
occurrence of each Event of Default and each Default, a written statement, signed by a
Responsible Officer, setting forth the details of such event and the action that the Borrower
proposes to take with respect thereto;

     (ii) promptly, but in no event later than ten (10) days after its receipt thereof, copies
of any and all notices, certificates, documents, or reports delivered to it by the Performance
Guarantor under the Purchase Agreement;

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     (iii) on each Reporting Date, the Borrower, or the Manager on its behalf, shall submit to
the Custodian and the Administrative Agent a monthly statement in the form agreed to between the
Manager and the Administrative Agent (a “Monthly Report”) signed by a Responsible
Officer of the Manager, including (x) a calculation of the Borrowing Base, the Coverage Tests
and the Weighted Average FMV Test as of the most recent Determination Date, (y) a summary
prepared with respect to each Obligor and with respect to each Loan Asset for such Obligor
prepared as of the most recent Determination Date that will be required to set forth whether or
not each such Loan Asset shall have become subject to an amendment, modification or waiver
(including whether such action constitutes a Material Modification) and (z) a calculation of
amounts payable pursuant to Section 2.7.

     (iv) together with each Monthly Report, the Borrower, or the Manager on its behalf, shall
submit to the Custodian and the Administrative Agent a certificate (a “Manager’s
Certificate”), signed by a Responsible Officer of the Manager and substantially in the form
of Exhibit F;

     (v) promptly, but in no event later than ten (10) days after such information becomes
available or is received, copies of all monthly reports, payment date statements, notices,
documents and other reports delivered to the trustee, collateral administrator or
securityholders in connection with the CLO and copies of any material notices delivered to GSC
Investment or the Manager, in its capacity as collateral manager for the CLO;

     (vi) the Borrower will submit to the Custodian and the Administrative Agent, promptly upon
receipt thereof and in any event (i) within 45 days after the end of each fiscal quarter of the
Performance Guarantor, consolidated unaudited financial statements of the Performance Guarantor
for the most recent fiscal quarter, and (ii) within 90 days after the end of each fiscal year,
commencing with the fiscal year ended February 28, 2010, consolidated audited financial
statements of the Performance Guarantor, audited without qualification by a firm of nationally
recognized independent public accountants, as of the end of such fiscal year;

     (vii) the Borrower shall appoint a firm of Independent certified public accountants of
recognized national reputation as the firm of Independent certified public accountants for
purposes of preparing and delivering the reports or certificates of such accountants required by
this Agreement. The Borrower, or the Manager on behalf of the Borrower, shall have the right to
remove such firm or any successor firm. Upon any resignation by or removal of such firm, the
Borrower, or the Manager on behalf of the Borrower, shall promptly appoint a successor thereto
that shall also be a firm of Independent certified public accountants of recognized national
reputation. If the Borrower, or the Manager on behalf of the Borrower, shall fail to appoint a
successor to a firm of Independent certified public accountants which has resigned or been
removed within 30 days after such resignation or removal, the Borrower shall promptly notify the
Administrative Agent of such failure in writing. If the Borrower, or the Manager on behalf of
the Borrower, shall not have appointed a successor within ten days thereafter, the
Administrative Agent shall promptly notify the Manager, who shall appoint a successor firm of
Independent certified public accountants of recognized national reputation reasonably acceptable
to the Administrative Agent. The fees of such Independent certified public accountants and its
successor shall be payable by the Borrower. On or before the day which is 90 days following the
end of Borrower’s fiscal year, commencing in 2011, the Borrower shall cause to be delivered to
the Administrative Agent and the Manager, (i) a report relating to the prior fiscal year to the
effect that (A) such firm has reviewed certain documents and records relating to the management
and servicing of the Loan Assets, including at least three Monthly Reports delivered hereunder,
and (B) based on such examination, such firm is of the opinion that such Monthly Reports for
such year were prepared in compliance with this Agreement, except for such exceptions as it
believes to be immaterial and such other exceptions as will be set forth in such firm’s report
and (ii) a report covering such fiscal year to the effect that such accountants have applied
certain agreed-upon

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procedures (which procedures shall not be amended from those procedures in effect as of the
Closing Date without the prior approval of the Borrower and Administrative Agent) to certain
documents and records relating to the management and servicing of Loan Assets under this
Agreement, compared the information contained in the Monthly Reports and the Manager’s
Certificates delivered during the applicable periods covered by such report with such documents
and records and that no matters came to the attention of such accountants that caused them to
believe that such servicing was not conducted in compliance with Article VII of this
Agreement, except for such exceptions as such accountants shall believe to be immaterial and
such other exceptions as shall be set forth in such statement; provided that, in
the event of a conflict between such firm of Independent certified public accountants of
recognized national reputation and the Borrower with respect to any matter in this clause
(a)(vi), the determination by such firm of Independent public accountants of recognized
national reputation shall be conclusive; and

     (viii) On or before the day which is 90 days following the end of Borrower’s fiscal year,
commencing in 2011, the Borrower, or the Manager on its behalf, will provide to the Custodian
and the Administrative Agent, an annual report signed by a Responsible Officer of the Manager
certifying that (a) a review of the activities of the Manager, and the Manager’s performance
pursuant to this Agreement, for the period ending on the last day of such fiscal year has been
made under such Person’s supervision and (b) the Manager has performed or has caused to be
performed in all material respects all of its obligations under this Agreement throughout such
year and no Default or Event of Default has occurred and is continuing (or if a Default or Event
of Default has so occurred and is continuing, specifying each such event, the nature and status
thereof and the steps necessary to remedy such event, and, if a Default or Event of Default
occurred during such year and no notice thereof has been given to the Administrative Agent,
specifying such Default or Event of Default and the steps taken to remedy such event).

     (b) Access. The Borrower, or the Manager on its behalf, as applicable, and the
Manager shall provide to the Administrative Agent and the Custodian access to the Loan Asset
Documents and all other documentation regarding the Loan Assets included as part of the Collateral
and the Related Property, such access being afforded without charge but only (A) upon reasonable
prior notice, (B) during normal business hours and (C) subject to the Manager’s normal security and
confidentiality procedures.

     (c) Audits; Inspections; Valuations. At the discretion of the Administrative Agent,
the Administrative Agent may review the Borrower’s and the Manager’s collection and administration
activities and policies in respect of the Loan Assets in order to assess compliance by the Manager
with the Manager’s written policies and procedures, as well as with this Agreement and may conduct
an audit of the Loan Assets, Loan Asset Documents and Records in conjunction with such a review,
which audit shall be reasonable in scope and shall be completed in a reasonable period of time.
The Administrative Agent may also engage a firm to conduct a valuation of any Loan Asset included
in the Collateral and the Borrower and the Manager shall cooperate with the Administrative Agent
and such valuation firm in connection therewith. The Borrower shall bear the cost of all reviews,
inspections, valuations and audits conducted by the Administrative Agent in connection with this
Agreement.

     (d) Obligor Financial Statements; Valuation Reports; Other Reports. The Manager will
deliver to the Administrative Agent and the Custodian, with respect to each Obligor, (i) to the
extent received by the Borrower and/or the Manager pursuant to the Loan Asset Documents, the
complete financial reporting package with respect to such Obligor and with respect to each Loan
Asset for such Obligor (including any covenant compliance certificates with respect to such Obligor
and with respect to each Loan Asset for such Obligor) provided to the Borrower and/or the Manager
either monthly or quarterly, as the case may be, by such Obligor, which delivery shall be made
within 45 days (or such longer period as specified in the Loan Asset Documents) after the end of
each such month or such

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Obligor’s fiscal quarters, as applicable (excluding the last month or fiscal quarter, as
applicable, of each such Obligor’s fiscal year), and within 90 days (or such longer period as
specified in the Loan Asset Documents) after the end of each such Obligor’s fiscal year, and (ii) a
quarterly update to the “tear sheet” prepared by the Manager with respect to such Obligor and with
respect to each Loan Asset for such Obligor, which delivery shall be made within 45 days (or such
longer period as specified in the Loan Asset Documents) after the end of each such Obligor’s fiscal
quarters (excluding the last fiscal quarter of each such Obligor’s fiscal year) and within 90 days
(or such longer period as specified in the Loan Asset Documents) after the end of each such
Obligor’s fiscal year. The Manager will promptly deliver to the Administrative Agent, upon
reasonable request and to the extent received by the Borrower and/or the Manager, all other
documents and information required to be delivered by the Obligors to the Borrower with respect to
any Loan Asset included in the Collateral.

     (e) Amendments to Loan Assets. The Manager will deliver to the Administrative Agent
and the Custodian a copy of any material amendment, restatement, supplement, waiver or other
modification to the Loan Asset Documents of any Loan Asset (along with any internal documents
prepared by the Manager and provided to its investment committee in connection with such amendment,
restatement, supplement, waiver or other modification) within 10 Business Days of the effectiveness
of such amendment, restatement, supplement, waiver or other modification.

     (f) Website Access to Information. Notwithstanding anything to the contrary contained
herein, information required to be delivered or submitted to any Secured Party pursuant to this
Article VII shall be deemed to have been delivered on the date on which such information is
posted on an IntraLinks (or other replacement) website to which the Administrative Agent has
access.

     (g) Investment Committee Rights. Madison, so long as Madison is a Lender, shall be
entitled to designate one person to observe the credit or investment committee meetings of the
Borrower, GSC Investment and the Manager. The Borrower shall be responsible for reasonable and
documented reimbursement of all expenses (including travel expenses) incurred in connection with
Madison’s exercise of such rights. Such observation rights shall include all of the rights of a
member of such investment or credit committee, other than the right to vote. Further, Madison
shall each be entitled to receive any notices and written documents distributed to the committee
members at or with respect to any investment or credit committee meeting. Without limiting the
generality of this Section 7.10, the Manager shall provide or cause to be provided to the
Administrative Agent the minutes from meetings of the board of directors of GSC Investment.

     (h) Other Information. The Borrower, or the Manager on its behalf, and the Manager,
as applicable, shall provide to the Administrative Agent and the Custodian promptly upon request,
such other information, documents, records or reports respecting the Loan Assets or the condition
or operations, financial or otherwise, of the Borrower, the Manager or Performance Guarantor as the
Administrative Agent may from time to time reasonably request in order to protect the interests of
the Custodian, the Administrative Agent or the Secured Parties under or as contemplated by this
Agreement. Without limiting the generality of the foregoing, upon the occurrence and during the
continuance of an Event of Default, the Borrower, or the Manager on its behalf, and the Manager, as
applicable, shall provide to the Administrative Agent, promptly upon the receipt of the same by the
Borrower or the Manager, all information and correspondence relating to the Loan Assets and other
Collateral.

Section 7.11 [Reserved].

Section 7.12 [Reserved].

Section 7.13 The Custodian.

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     (a) Appointment. The Borrower and the Administrative Agent each hereby appoints U.S.
Bank to act as Custodian hereunder, for the benefit of the Administrative Agent and the Secured
Parties, as provided herein. U.S. Bank hereby accepts such appointment and agrees to perform the
duties and responsibilities with respect thereto set forth herein. The Borrower acknowledges and
agrees that the Custodian is agent solely for the Secured Parties and shall have no obligation to
the Borrower.

     (b) Custodial Duties. The Custodian shall act as collateral agent for the Secured
Parties and as custodian for the Borrower, and take and retain custody of the Loan Asset Files and
all other Collateral delivered by the Borrower or on its behalf pursuant to Section 5.4 in
accordance with the terms and conditions of this Agreement, all for the benefit of the Secured
Parties and subject to the Lien thereon in favor of the Secured Parties. Within one Business Day of
receipt of any such Loan Asset File, the Custodian shall deliver to the Administrative Agent a
custodial receipt in form of Exhibit G hereto. Within five Business Days of its receipt of
any Loan Asset File and the related Loan Asset Checklist, the Custodian shall review the related
Loan Asset Documents to verify that each Loan Asset Document listed on the Loan Asset Checklist has
been received, is executed (where applicable) and has no missing or mutilated pages and that each
Underlying Note with respect to each Loan Asset (other than a Noteless Loan Asset) is an original
note, and to confirm (in reliance on the Obligor name and other identifying information listed on
the Schedule of Loan Assets) that such Loan Asset is referenced on the related Schedule of Loan
Assets and shall, each calendar month on the date which is two Business Days prior to the Reporting
Date occurring in such month, deliver to the Administrative Agent a certification in the form of
Exhibit H hereto. Except as described in the preceding sentence with respect to Underlying
Notes, the Custodian may fulfill its obligations hereunder by accepting and reviewing copies of all
Loan Asset Documents in a Loan Asset File. In order to facilitate the foregoing review by the
Custodian, in connection with each delivery of Loan Asset Files hereunder to the Custodian, the
Manager shall provide to the Custodian an electronic file in a mutually acceptable electronic
format that contains the related Schedule of Loan Assets. If, at the conclusion of such review, the
Custodian shall determine that any such Loan Asset Document is not executed (where applicable), is
missing pages or has mutilated pages, that any Underlying Note is not an original as required, that
any Loan Asset Document listed on the Loan Asset Checklist is missing from the Loan Asset File or
that any such Loan Asset Document received in the Loan Asset File is not listed on the related Loan
Asset Checklist, the Custodian shall promptly notify the Borrower and the Administrative Agent of
such determination by providing an exception report to such Persons setting forth, with
particularity, such of the foregoing defects as may exist. In addition, unless instructed otherwise
in writing by the Borrower and the Administrative Agent within ten days of the Custodian’s delivery
of such report, the Custodian shall return any Loan Asset File not referenced on such Schedule of
Loan Assets to the Borrower. Other than the foregoing, the Custodian shall not have any
responsibility for reviewing any Loan Asset File. In taking and retaining custody of the Loan Asset
Files, the Custodian shall be acting as the agent of the Administrative Agent and the other Secured
Parties; provided that the Custodian makes no representations as to the existence, perfection or
priority of any Lien on the Loan Asset Files or the instruments therein; provided further that the
Custodian’s duties as agent for the Administrative Agent and the other Secured Parties shall be
limited to those expressly contemplated herein. All Loan Asset Files shall be kept in
fire-resistant vaults or cabinets at the locations specified on Schedule IV attached
hereto, or at such other office as shall be specified to the Administrative Agent and the Borrower
by the Custodian in a written notice delivered at least 45 days prior to such change. All Loan
Asset Files shall be segregated with an appropriate identifying label and maintained in such a
manner so as to permit retrieval and access. All Loan Asset Files shall be clearly segregated from
any other documents or instruments maintained by the Custodian. The Custodian shall clearly
indicate that such Loan Asset Files are the sole property of Borrower, subject to the security
interest of the Administrative Agent on behalf of the Secured Parties. In performing its duties,
the Custodian shall use the same degree of care and attention as it employs with respect to similar
files that it holds as custodian for others. Except as otherwise provided herein, the Custodian
shall have no power or authority to assign, hypothecate or otherwise dispose of Loan Asset Files.
Without limiting the

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foregoing, the Custodian shall act as custodian for the Secured Parties, and take and retain
custody of any securities or instruments evidencing the CLO Equity and any Supplemental Interests
delivered by the Borrower or on its behalf pursuant to Section 5.4 in accordance with the
terms and conditions of this Agreement, all for the benefit of the Secured Parties and subject to
the Lien thereon in favor of the Secured Parties; provided that the Custodian’s obligations with
respect thereto shall be limited to holding such Collateral as custodian in accordance with the
term of this Agreement in order for the Administrative Agent to perfect its Lien thereon.
Notwithstanding anything to the contrary contained herein, the Loan Asset Files shall at all times
be subject to inspection by (i) the SEC through its authorized employees or agents, accompanied,
unless otherwise directed by order of the SEC, by one or more officers of the Performance Guarantor
and (ii) the Performance Guarantor’s independent registered public accounting firm.

(c) Concerning the Custodian.

     (i) Except for its willful misconduct, gross negligence or bad faith, the Custodian may
conclusively rely on and shall be fully protected in acting upon any certificate, instrument,
opinion, notice, letter, instruction, entitlement order, telegram or other document delivered to
it and that in good faith it reasonably believes to be genuine and that has been signed by the
proper party or parties. Except for its willful misconduct, gross negligence or bad faith, the
Custodian may rely conclusively on and shall be fully protected in acting upon the written
instructions of any designated officer of the Administrative Agent.

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

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

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

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

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

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

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     (viii) In case any reasonable question arises as to its duties hereunder, the Custodian may
request written instructions from the Administrative Agent, and shall be entitled at all times
to refrain from taking any action unless it has received written instructions from the
Administrative Agent. Notwithstanding the preceding sentence, and subject to Section
7.13(d), the Administrative Agent hereby expressly instructs the Custodian, prior to the
occurrence of the Termination Date, to take any action in respect of the Loan Assets and the
Loan Asset Documents solely in accordance with written instructions of the Manager unless and
until receipt by the Custodian of written notice from the Administrative Agent after an Event of
Default has occurred and is continuing, and thereafter to take any action in respect of the Loan
Assets and the Loan Asset Documents solely in accordance with written instructions of the
Administrative Agent. The Custodian shall in all events have no liability, risk or cost for any
action taken pursuant to and in compliance with the written instruction of the Administrative
Agent or, prior to the occurrence of the Termination Date, the Manager. Absent written
instructions from the Borrower or the Manager as to the disposition of funds pursuant to
Section 2.7, the Custodian shall hold all funds uninvested until it receives written
direction from the Administrative Agent.

     (d) Release for Servicing. From time to time and as appropriate for the enforcement or
servicing of any of the Loan Assets, the Custodian is hereby authorized, upon receipt from the
Manager on behalf of the Borrower, of a written request for release of Loan Asset Files
substantially in the form annexed hereto as Exhibit J, to release to the Manager the
related Loan Asset File set forth in such request and receipt to the Manager; provided,
that notwithstanding the foregoing or any other provision of this Agreement, at any time
following the occurrence of an Event of Default and upon its receipt of written instructions from
the Administrative Agent, the Custodian shall cease releasing Loan Asset Files to the Manager
without the prior written consent of the Administrative Agent. All Loan Asset Files so released to
the Manager on behalf of the Borrower shall be held by the Manager in trust for the benefit of the
Borrower, the Administrative Agent, the Custodian and the other Secured Parties, with respect to
their respective interests, in accordance with the terms of this Agreement. The Manager, on behalf
of the Borrower, shall return to the Custodian the Loan Asset File when the Manager’s need therefor
in connection with such foreclosure or servicing no longer exists, unless the Loan Asset shall be
liquidated, in which case, upon receipt of an additional request for release of Loan Asset Files
and certification as to such liquidation from the Manager to the Custodian substantially in the
form annexed hereto as Exhibit J, such Loan Asset File shall be released by the Custodian
to the Manager.

     (e) Release for Payment. Upon receipt by the Custodian (with a copy to the
Administrative Agent) of the Manager’s written request for release of Loan Asset Files and receipt
in the form annexed hereto as Exhibit J in connection with any payment, repurchase or sale
(which certification shall include a statement to the effect that all amounts received in
connection with such payment, repurchase or sale have been credited to the Collection Account as
provided in this Agreement), the Custodian shall promptly release the related Loan Asset File to
the Manager, on behalf of the Borrower.

     (f) Custodian Compensation. As compensation for its activities hereunder, the
Custodian shall be entitled to a Custodian Fee and any unpaid Custodian Expenses to the extent of
funds available therefor pursuant to the provision of Section 2.7. The Custodian’s
entitlement to receive the Custodian Fee (other than due and unpaid Custodian Fees owed through
such date) shall cease on the earlier to occur of: (i) its removal as Custodian or (ii) the
termination of this Agreement.

     (g) Replacement of the Custodian. The Custodian may be replaced by the Borrower with
the prior consent of the Administrative Agent; provided that no such replacement
shall be effective until a successor Custodian has been appointed by the Borrower, has agreed in
writing to act as Custodian hereunder and has received all Loan Asset Files held by the previous
Custodian. The Custodian may resign upon ten (10) Business Days notice to the Administrative Agent
and the Borrower, provided that

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any such resignation shall not be effective until the date on which a successor Custodian has
been appointed, has agreed in writing to act as Custodian hereunder and has received all Loan Asset
Files held by the previous Custodian. Notwithstanding anything in this Agreement to the contrary,
no successor Custodian may be appointed unless such successor Custodian meets the requirements of
Section 26(a)(1) of the 1940 Act and provides a representation to this effect, reasonably
satisfactory to the Borrower, the Manager and the Administrative Agent.

     (h) Release of Loan Asset Documents Following a Discretionary Sale. To the extent that
portions of Loan Assets are transferred pursuant to a Discretionary Sale under Section
2.14, the Custodian shall release the original Loan Asset Documents.

     (i) Notices; Consents. The Custodian shall provide to the Manager a copy of all
written notices and communications identified as being sent to it in connection with the Loan
Assets and the other Collateral held hereunder which it receives from the related Obligor,
participating bank and/or agent bank. In no instance shall the Custodian be under any duty or
obligation to take any action on behalf of the Manager or the Borrower in respect of the exercise
of any voting or consent rights, or similar actions, unless it receives specific and timely written
instructions from the Administrative Agent, in which event the Custodian shall vote, consent or
take such other action in accordance with such instructions. The Administrative Agent hereby
expressly instructs the Custodian to take any such action solely in accordance with the written
instructions of the Manager unless and until a notice of exclusive control has been delivered to
the Custodian and is in effect pursuant to the terms of the Account Control Agreement, and
thereafter to take any such action solely in accordance with the written instructions of the
parties specified in such notice of exclusive control.

     (j) Perfection of Security Interests. The Administrative Agent and the Lenders hereby
appoint U.S. Bank, in its capacity as Custodian hereunder, as their agent and custodian for the
purposes of perfection of a security interest in the Loan Assets. U.S. Bank, in its capacity as
Custodian hereunder, hereby accepts such appointment and agrees to perform only the express duties
set forth in this Section 7.13 and subject to the provisions hereof.

     (i) Each of the Administrative Agent and each other Secured Party further authorizes the
Custodian to take such action as agent on its behalf and to exercise such powers under this
Agreement and the other Transaction Documents as are expressly delegated to the Custodian by the
terms hereof and thereof, together with such powers as are reasonably incidental thereto. In
furtherance, and without limiting the generality of the foregoing, each Secured Party hereby
appoints the Custodian as its agent to execute and deliver all further instruments and
documents, and take all further action that the Administrative Agent deems necessary or
desirable in order to perfect, protect or more fully evidence the security interests granted by
the Borrower hereunder, or to enable any of them to exercise or enforce any of their respective
rights hereunder, including the execution by the Custodian as secured party/assignee of such
financing or continuation statements, or amendments thereto or assignments thereof, relative to
all or any of the Loan Assets now existing or hereafter arising, and such other instruments or
notices, as may be necessary or appropriate for the purposes stated hereinabove. Nothing in this
Section 7.13(j) shall be deemed to relieve the Borrower of its obligation to protect the
interest of the Custodian (for the benefit of the Secured Parties) in the Collateral, including
to file financing and continuation statements in respect of the Collateral in accordance with
this Agreement.

     (ii) With respect to other actions which are incidental to the actions specifically
delegated to the Custodian hereunder, the Custodian shall not be required to take any such
incidental action hereunder, but shall be required to act or to refrain from acting (and shall
be fully protected in acting or refraining from acting) upon the direction of the Administrative
Agent; provided that the

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Custodian shall not be required to take any action hereunder at the request of the
Administrative Agent, any Secured Parties or otherwise if the taking of such action, in the
reasonable determination of the Custodian, (x) shall be in violation of any Applicable Law or
contrary to any provisions of this Agreement or (y) shall expose the Custodian to liability
hereunder or otherwise (unless it has received indemnity which it reasonably deems to be
satisfactory with respect thereto). In the event the Custodian requests the consent of the
Administrative Agent and the Custodian does not receive a consent (either positive or negative)
from the Administrative Agent with 10 Business Days of its receipt of such request, then the
Administrative Agent shall be deemed to have declined to consent to the relevant action.

     (iii) Except as expressly provided herein, the Custodian shall not be under any duty or
obligation to take any affirmative action to exercise or enforce any power, right or remedy
available to it under this Agreement or any of the Loan Asset Documents (i) unless and until
(and to the extent) expressly so directed in writing by the Administrative Agent or (ii) prior
to the occurrence of the Termination Date pursuant to clause (a) or (b) of the definition of
“Termination Date,” the Manager (and upon such occurrence, the Custodian shall act in accordance
with the written instructions of the Administrative Agent pursuant to Section 7.13(j)(i)). The
Custodian shall not be liable for any action taken, suffered or omitted by it in accordance with
the request or direction of any Secured Party, to the extent that this Agreement provides such
Secured Party the right to so direct the Custodian or the Administrative Agent. The Custodian
shall not be deemed to have notice or knowledge of any matter hereunder, including an Event of
Default, unless a Responsible Officer of the Custodian has actual knowledge of such matter or
written notice thereof is received by the Custodian.

     (k) Any Person (i) into which the Custodian may be merged or consolidated, (ii) that may
result from any merger or consolidation to which the Custodian shall be a party or (iii) that may
succeed to the properties and assets of the Custodian substantially as a whole, shall be the
successor to the Custodian under this Agreement without further act of any of the parties to this
Agreement.

     (l) The parties hereunder further acknowledge and agree that U.S. Bank also serves in the
capacity of custodian for GSC Investment and all assets belonging to GSC Investment are held in the
custody of U.S. Bank subject to agreement thereof, to the extent they are required to be held in
custody pursuant to the 1940 Act. Nothing in this Agreement shall be interpreted to jeopardize GSC
Investment’s compliance with Applicable Law and requirements to maintain assets with such
custodian.

Section 7.14 Representations and Warranties of the Custodian.

     The Custodian represents and warrants as follows:

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

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

     (c) Power and Authority. It has the power and authority to execute and deliver this
Agreement and each other Transaction Document to which it is a party and to carry out their
respective

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terms. It has duly authorized the execution, delivery and performance of this Agreement and
each other Transaction Document to which it is a party by all requisite action.

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

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

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

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

     (h) Non-Affiliation. The Custodian is not affiliated, as that term is defined in Rule
405 under the Securities Act, with the Borrower or the Manager or with any Person involved in the
organization or operation of the Borrower and does not provide credit or credit enhancement to the
Borrower.

Section 7.15 Covenants of the Custodian.

     The Custodian hereby covenants that:

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

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

     (c) No Bankruptcy Petition. Prior to the date that is one year and one day (or such
longer preference period as shall then be in effect) after the Collection Date, it will not
institute against the Borrower or join any other Person in instituting against the Borrower any
Insolvency Proceedings or other similar proceedings under the laws of the United States or any
state of the United States. This Section 7.15(c) will survive the termination of this
Agreement.

     (d) Loan Asset Files. The Custodian will not dispose of any documents constituting the
Loan Asset Files in any manner that is inconsistent with the performance of its obligations as the
Custodian pursuant to this Agreement and will not dispose of any Loan Asset except as contemplated
by this Agreement.

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     (e) Location of Loan Asset Files. The Loan Asset Files shall remain at all times in
the possession of the Custodian at the address set forth on Schedule IV.

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

ARTICLE VIII

EVENTS OF DEFAULT

Section 8.1 Events of Default.

     If any of the following events (each, an “Event of Default”) shall occur and be
continuing:

     (a) (i) the Borrower, GSC Investment or the Manager shall fail to make payment, transfer or
deposit of any amount required to be made under the terms of this Agreement and such failure shall
continue for more than three (3) Business Days; or (ii) the Borrower shall fail to repay all
Advances Outstanding and all other Facility Obligations on or prior to the Maturity Date; or

     (b) (i) the Borrower fails to comply with or to perform any of its obligations under Sections
5.1(b), (c), (d), (f) through (m) (inclusive) and (o) through (q) (inclusive), 5.2 and 5.3, (ii)
the Manager fails to comply with or to perform any of its obligations under Sections 7.6(b), (e),
(f) and (h), or (iii) the Administrative Agent, for the benefit of the Secured Parties, shall fail
for any reason to have a valid and perfected first priority security interest in the Collateral; or

     (c) the Borrower, GSC Investment or the Manager shall fail to perform or observe in any
material respect any other covenant or other agreement of the Borrower set forth in this Agreement
and any other Transaction Document to which it is a party (and not constituting an Event of Default
under any other provision of this Section 8.1), in each case when such failure continues
unremedied for more than thirty (30) days after the first to occur of (x) the date on which written
notice of such failure requiring the same to be remedied shall have been given to such Person by
the Administrative Agent, the Borrower, the Manager or the Custodian, as applicable, and (y) the
date on which such Person becomes or should have become aware thereof; or

     (d) any representation or warranty made or deemed made by the Borrower, GSC Investment or the
Manager hereunder or any other Transaction Document shall be incorrect in any material respect as
of the time when the same shall have been when made and such failure, if susceptible to a cure,
shall continue unremedied for a period of thirty (30) days after the first to occur of (i) the date
on which written notice of such failure requiring the same to be remedied shall have been given to
the Borrower, GSC Investment or the Manager, as the case may be, by the Administrative Agent and
(ii) the date on which such Person becomes or should have become aware thereof; or

     (e) a final non-appealable judgment for the payment of money shall have been rendered in an
amount in excess of $1,000,000 against GSC Investment, the Borrower or the Manager by a court of
competent jurisdiction and, if such judgment relates to GSC Investment or the Manager, such
judgment, decree or order shall continue unsatisfied and in effect for any period of thirty (30)
consecutive days without a stay of execution; or

     (f) an Insolvency Event shall occur with respect to the Borrower, GSC Investment or the
Manager (if an Affiliate of the Borrower or the Performance Guarantor); or

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     (g) any event or circumstance constituting a Material Adverse Change has occurred since
February 28, 2010 with respect to the Borrower, GSC Investment or the Manager; or

     (h) the Borrower or GSC Investment defaults in making any payment required to be made under
any material agreement for borrowed money to which either is a party and which, in the case of GSC
Investment only, shall evidence Indebtedness in excess of $1,000,000, and such default is not cured
within the relevant cure period, or any such recourse debt or other obligation shall be declared to
be due and payable or required to be prepaid (other than by scheduled payment) prior to its
maturity; or

     (i) the Interest Coverage Ratio shall fall below 150%; or

     (j) the Overcollateralization Ratio shall fall below 175%; or

     (k) GSC Investment shall fail to maintain its status as a “business development company,”
within the meaning of the Small Business Incentive Act of 1980, and its status as a “registered
investment company” under the Code, and such failure could reasonably be expected to have a
Material Adverse Effect; or

     (l) any Change-in-Control occurs; or

     (m) the Borrower or the pool of Collateral shall become an “investment company” subject to
registration under the 1940 Act or the business and other activities of the Borrower or GSC
Investment, including but not limited to, the acceptance of the Advances by the Borrower made by
the Lenders, the application and use of the proceeds thereof by the Borrower and the consummation
and conduct of the transactions contemplated by the Transaction Documents to which the Borrower or
GSC Investment is a party result in a violation by GSC Investment, the Borrower, or any other party
to the Transaction Documents of the 1940 Act or the rules and regulations promulgated thereunder;
or

     (n) the Internal Revenue Service shall file notice of a lien pursuant to Section 6323 of the
Code with regard to any assets of the Borrower and such lien shall not have been released within
five Business Days, or the Pension Benefit Guaranty Corporation shall file notice of a lien
pursuant to Section 4068 of ERISA with regard to any of the assets of the Borrower or any ERISA
Affiliate thereof and such lien shall not have been released within five Business Days; or

     (o) (i) the removal of any Independent Director of the Borrower without “cause” (as such term
is defined in the organizational document of the Borrower) or without giving prior written notice
to the Administrative Agent, each as required in the organizational documents of the Borrower or
(ii) an Independent Director of the Borrower which is not provided by a nationally recognized
service reasonably acceptable to the Administrative Agent shall be appointed without the consent of
the Administrative Agent; or

     (p) any Manager Event occurs; or

     (q) if the Manager is an Affiliate of the Borrower or GSC Investment, the Manager shall fail
to maintain its status as a registered investment advisor under the Investment Advisers Act of
1940, as amended.

     Upon its receipt of written notice thereof, the Administrative Agent shall promptly notify
each Lender of the occurrence of any Event of Default.

Section 8.2 Remedies.

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     (a) Upon the occurrence of an Event of Default, the Administrative Agent shall, at the
request, or may with the consent, of the Required Lenders, by notice to the Borrower (with a copy
to the Custodian) declare the Termination Date to have occurred, without demand, protest or further
notice of any kind, all of which are hereby expressly waived by the Borrower, and all Advances
Outstanding and all other amounts owing by the Borrower under this Agreement shall be accelerated
and become immediately due and payable, provided, that in the event that the Event of Default
described in Section 8.1(f) herein has occurred, the Termination Date shall automatically
occur, without demand, protest or any notice of any kind, all of which are hereby expressly waived
by the Borrower.

     (b) Upon any such declaration or automatic occurrence of the Termination Date as specified
under Section 8.2(a), no further Advances will be made, and the Administrative Agent and
the other Secured Parties shall have, in addition to all other rights and remedies under this
Agreement or otherwise, all rights and remedies provided under the UCC of each applicable
jurisdiction and other Applicable Laws, including the right to sell the Collateral, which rights
and remedies shall be cumulative.

     (c) If, (i) upon the declaration that the Advances made to the Borrower hereunder are
immediately due and payable pursuant to this Section 8.2 upon the occurrence of an Event of
Default, or (ii) on the Termination Date (other than a Termination Date occurring pursuant to
clause (c) of the definition thereof prior to an Event of Default), the aggregate outstanding
principal amount of the Advances, all accrued and unpaid fees and Interest and any other Facility
Obligations are not immediately paid in full, then the Administrative Agent or the Custodian
(acting as directed in writing by the Administrative Agent), in addition to all other rights
specified hereunder, shall have the right, in its own name and as agent for the Secured Parties, to
immediately sell, or appoint an agent to sell, (at the Manager’s expense) in a commercially
reasonable manner, in a recognized market (if one exists) at such price or prices as the
Administrative Agent may reasonably deem satisfactory, any or all of the Collateral and apply the
proceeds thereof to the Facility Obligations.

     (d) The parties recognize that it may not be possible to sell all of the Collateral on a
particular Business Day, or in a transaction with the same purchaser, or in the same manner because
the market for the assets constituting the Collateral may not be liquid. Accordingly, the
Administrative Agent may elect, in its sole discretion, the time and manner of liquidating any of
the Collateral, and nothing contained herein shall obligate the Administrative Agent to liquidate
any of the Collateral on the date the Administrative Agent declares the Advances made to the
Borrower hereunder to be immediately due and payable pursuant to this Section 8.2 or to
liquidate all of the Collateral in the same manner or on the same Business Day.

     (e) If the Administrative Agent or the Custodian (acting as directed in writing by the
Administrative Agent) proposes to sell the Collateral or any part thereof in one or more parcels at
a public or private sale, at the request of the Custodian or the Administrative Agent, as
applicable, the Borrower and the Manager shall make available to (i) the Administrative Agent, on a
timely basis, all information (including any information that the Borrower and the Manager is
required by law or contract to be kept confidential; provided that the Administrative Agent shall
maintain the confidentiality thereof) relating to the Collateral subject to sale, including copies
of any disclosure documents, contracts, financial statements of the applicable Obligors, covenant
certificates and any other materials requested by the Administrative Agent, and (ii) each
prospective bidder, on a timely basis, all reasonable information relating to the Collateral
subject to sale, including copies of any disclosure documents, contracts, financial statements of
the applicable Obligors, covenant certificates and any other materials reasonably requested by each
such bidder; provided that with respect to this clause (ii), neither the Borrower
nor the Manager shall be required to disclose to each such bidder any information which it is
required by law or contract to be kept confidential.

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     (f) Each of the Borrower and the Manager agrees, to the full extent that it may lawfully so
agree, that neither it nor anyone claiming through or under it will set up, claim or seek to take
advantage of any appraisement, valuation, stay, extension or redemption law now or hereafter in
force in any locality where any Collateral may be situated in order to prevent, hinder or delay the
enforcement or foreclosure of this Agreement, or the absolute sale of any of the Collateral or any
part thereof, or the final and absolute putting into possession thereof, immediately after such
sale, of the purchasers thereof, and each of the Borrower and the Manager, for itself and all who
may at any time claim through or under it, hereby waives, to the full extent that it may be lawful
so to do, the benefit of all such laws, and any and all right to have any of the properties or
assets constituting the Collateral marshaled upon any such sale, and agrees that the Administrative
Agent, or the Custodian on its behalf, or any court having jurisdiction to foreclose the security
interests granted in this Agreement may sell the Collateral as an entirety or in such parcels as
such court may determine.

     (g) Any amounts received from any sale or liquidation of the Collateral pursuant to this
Section 8.2 in excess of the Obligations will be applied in accordance with the provisions
of Section 2.7, or as a court of competent jurisdiction may otherwise direct.

     (h) Except as otherwise expressly provided in this Agreement, no remedy provided for by this
Agreement shall be exclusive of any other remedy, each and every remedy shall be cumulative and in
addition to any other remedy, and no delay or omission to exercise any right or remedy shall impair
any such right or remedy or shall be deemed to be a waiver of any Event of Default.

     (i) Each of the Borrower and the Manager hereby irrevocably appoints the Administrative Agent
its true and lawful attorney (with full power of substitution) in its name, place and stead and at
is expense, in connection with the enforcement of the rights and remedies after the occurrence of
an Event of Default, and as provided for in this Agreement, including without limitation the
following powers: (a) to give any necessary receipts or acquittance for amounts collected or
received hereunder, (b) to make or cause all necessary transfers of the Collateral in connection
with any such sale or other disposition made pursuant hereto, (c) to execute and deliver for value
all necessary or appropriate bills of sale, assignments and other instruments in connection with
any such sale or other disposition, the Borrower and the Manager hereby ratifying and confirming
all that such attorney (or any substitute) shall lawfully do hereunder and pursuant hereto, and (d)
to sign any agreements, orders or other documents in connection with or pursuant to any Transaction
Document. Nevertheless, if so requested by the Administrative Agent, the Borrower shall ratify and
confirm any such sale or other disposition by executing and delivering to the Administrative Agent
or all proper bills of sale, assignments, releases and other instruments as may be designated in
any such request; provided that, for the avoidance of doubt, no right under any power of
attorney furnished under this Section 8.2(i) may be exercised until after the occurrence of
an Event of Default.

ARTICLE IX

INDEMNIFICATION

Section 9.1 Indemnities by the Borrower.

     (a) Without limiting any other rights that any such Person may have hereunder or under
Applicable Law, the Borrower hereby agrees to indemnify the Administrative Agent, the Manager, any
Successor Manager, the Custodian, any Secured Party or its assignee and each of their respective
Affiliates and officers, directors, employees, members and agents thereof (collectively, the
“Indemnified Parties”), forthwith on demand, from and against any and all damages, losses,
claims, liabilities and related costs and expenses, including reasonable attorneys’ fees and
disbursements (all of the foregoing

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being collectively referred to as “Indemnified Amounts”) awarded against or incurred
by, any such Indemnified Party or other non-monetary damages of any such Indemnified Party any of
them arising out of or as a result of this Agreement, excluding, however, Indemnified Amounts to
the extent (i) resulting from gross negligence or willful misconduct on the part of any Indemnified
Party or (ii) arising in respect of Taxes excluded from the definition of Additional Amount
pursuant to Section 2.12(a). Notwithstanding anything in this Agreement to the contrary,
Indemnified Amounts owed to the Manager shall be paid in accordance with Section 2.7.
Without limiting the foregoing, the Borrower shall indemnify the Indemnified Parties for
Indemnified Amounts relating to or resulting from:

     (i) any Loan treated as or represented by the Borrower to be an Eligible Loan Asset that is
not at the applicable time an Eligible Loan Asset;

     (ii) reliance on any representation or warranty made or deemed made by the Borrower or the
Manager (or one of their respective Affiliates) or any of their respective officers under or in
connection with this Agreement, which shall have been false or incorrect in any material respect
when made or deemed made or delivered;

     (iii) the failure by the Borrower or the Manager (or one of their respective Affiliates) to
comply with any term, provision or covenant contained in this Agreement or any agreement
executed in connection with this Agreement, or with any Applicable Law with respect to any Loan
Asset comprising a portion of the Collateral, or the nonconformity of any Loan Asset, the
Related Property with any such Applicable Law or any failure by the Performance Guarantor, the
Borrower or any Affiliate thereof to perform its respective duties under the Loan Assets
included as a part of the Collateral;

     (iv) the failure to vest and maintain vested in the Administrative Agent a first priority
perfected security interest in the Collateral;

     (v) the failure to file, or any delay in filing, financing statements or other similar
instruments or documents under the UCC of any applicable jurisdiction or other Applicable Laws
with respect to any Collateral whether at the time of any Advance or at any subsequent time and
as required by the Transaction Documents;

     (vi) any dispute, claim, offset or defense (other than the discharge in bankruptcy of the
Obligor) of the Obligor to the payment of any Loan included as part of the Collateral that is,
or is purported to be, an Eligible Loan Asset (including a defense based on such Loan Asset not
being a legal, valid and binding obligation of such Obligor enforceable against it in accordance
with its terms);

     (vii) any failure of the Borrower or the Manager (if the Performance Guarantor or one of
its Affiliates) to perform its duties or obligations in accordance with the provisions of this
Agreement or any failure by the Performance Guarantor, the Borrower or any Affiliate thereof to
perform its respective duties under the Loan Assets;

     (viii) any products liability claim or personal injury or property damage suit or other
similar or related claim or action of whatever sort arising out of or in connection with
merchandise or services that are the subject of any Loan Asset included as part of the
Collateral or the Related Property included as part of the Collateral;

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     (ix) the failure by Borrower to pay when due any Taxes for which the Borrower is liable,
including without limitation, sales, excise or personal property taxes payable in connection
with the Collateral;

     (x) any repayment by the Administrative Agent or a Secured Party of any amount previously
distributed in reduction of Advances Outstanding or payment of Interest or any other amount due
hereunder or under any Hedging Agreement, in each case which amount the Administrative Agent or
a Secured Party believes in good faith is required to be repaid;

     (xi) any investigation, litigation or proceeding related to this Agreement or the use of
proceeds of Advances or in respect of any Loan Asset included as part of the Collateral or the
Related Property included as part of the Collateral;

     (xii) any failure by the Borrower to give reasonably equivalent value to the Performance
Guarantor in consideration for the transfer by the Performance Guarantor to the Borrower of any
Loan Asset or the Related Property or any attempt by any Person to void or otherwise avoid any
such transfer under any statutory provision or common law or equitable action, including any
provision of the Bankruptcy Code;

     (xiii) the failure of the Borrower, the Performance Guarantor or any of their respective
agents or representatives to remit to the Manager or the Administrative Agent, Collections on
the Collateral remitted to the Borrower or any such agent or representative in accordance with
the terms hereof or the commingling by the Borrower or any Affiliate of any collections; or

     (xiv) the occurrence of a Subordination Event.

     (b) Any amounts subject to the indemnification provisions of this Section 9.1 shall be
paid by the Borrower to the applicable Indemnified Party pursuant to the terms of Section
2.7.

     (c) If for any reason the indemnification provided above in this Section 9.1 is
unavailable to the Indemnified Party or is insufficient to hold an Indemnified Party harmless, then
the Borrower shall contribute to the amount paid or payable by such Indemnified Party as a result
of such loss, claim, damage or liability in such proportion as is appropriate to reflect not only
the relative benefits received by such Indemnified Party on the one hand and the Borrower, on the
other hand but also the relative fault of such Indemnified Party as well as any other relevant
equitable considerations.

     (d) The obligations of the Borrower under this Section 9.1 shall survive the removal
of the Administrative Agent and the termination of this Agreement.

Section 9.2 Indemnities by the Manager.

     (a) Without limiting any other rights that any such Person may have hereunder or under
Applicable Law, the Manager (if an Affiliate of the Borrower or the Performance Guarantor) hereby
agrees to indemnify each Indemnified Party, forthwith on demand, from and against any and all
Indemnified Amounts (calculated without duplication of Indemnified Amounts paid by the Borrower
pursuant to Section 9.1 above) awarded against or incurred by any such Indemnified Party by
reason of any acts, omissions or alleged acts or omissions of the Manager, including, but not
limited to (i) any representation or warranty made by the Manager under or in connection with any
Transaction Documents to which it is a party, any Monthly Report, Manager’s Certificate or any
other information or report delivered by or on behalf of the Manager pursuant hereto, which shall
have been false, incorrect or misleading in any material respect when made or deemed made, (ii) the
failure by the Manager to comply

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with any Applicable Law, (iii) the failure of the Manager to comply with its duties or
obligations in accordance with the Agreement, (iv) any litigation, proceedings or investigation
against the Manager, or (v) the occurrence of a Subordination Event occurring as a result of the
conduct of the Manager, excluding, however, Indemnified Amounts to the extent (i)
resulting from gross negligence or willful misconduct on the part of any Indemnified Party or (ii)
arising in respect of Taxes excluded from the definition of Additional Amount pursuant to
Section 2.12(a). The provisions of this indemnity shall run directly to and be enforceable
by an injured party subject to the limitations hereof. If the Manager has made any indemnity
payment pursuant to this Section 9.2 and such payment fully indemnified the recipient
thereof and the recipient thereafter collects any payments from others in respect of such
Indemnified Amounts, the recipient shall repay to the Manager an amount equal to the amount it has
collected from others in respect of such indemnified amounts.

     (b) If for any reason the indemnification provided above in this Section 9.2 is
unavailable to the Indemnified Party or is insufficient to hold an Indemnified Party harmless, then
Manager shall contribute to the amount paid or payable to such Indemnified Party as a result of
such loss, claim, damage or liability in such proportion as is appropriate to reflect not only the
relative benefits received by such Indemnified Party on the one hand and Manager on the other hand
but also the relative fault of such Indemnified Party as well as any other relevant equitable
considerations.

     (c) The obligations of the Manager under this Section 9.2 shall survive the
resignation or removal of the Administrative Agent and the termination of this Agreement.

     (d) The parties hereto agree that the provisions of this Section 9.2 shall not be
interpreted to provide recourse to the Manager against loss by reason of the bankruptcy or
insolvency (or other credit condition) of, or default by, related Obligor on, any Loan Asset,
except to the extent such Indemnified Amounts directly result from the Manager’s breach of its
obligations hereunder.

     (e) Any indemnification pursuant to this Section 9.2 shall not be payable from the
Collateral.

ARTICLE X

THE ADMINISTRATIVE AGENT

Section 10.1 Authorization and Action.

     Each Secured Party hereby designates and appoints Madison as Administrative Agent hereunder,
and authorizes Madison to take such actions as agent on its behalf and to exercise such powers as
are delegated to the Administrative Agent by the terms of this Agreement together with such powers
as are reasonably incidental thereto. The Administrative Agent shall not have any duties or
responsibilities, except those expressly set forth herein, or any fiduciary relationship with any
Secured Party, and no implied covenants, functions, responsibilities, duties, obligations or
liabilities on the part of the Administrative Agent shall be read into this Agreement or otherwise
exist for the Administrative Agent. In performing its functions and duties hereunder, the
Administrative Agent shall act solely as agent for the Secured Parties and does not assume nor
shall be deemed to have assumed any obligation or relationship of trust or agency with or for the
Borrower or any of its successors or assigns. The Administrative Agent shall not be required to
take any action that exposes the Administrative Agent to personal liability or that is contrary to
this Agreement or Applicable Law. The appointment and authority of the Administrative Agent
hereunder shall terminate at the indefeasible payment in full of the Facility Obligations.

Section 10.2 Delegation of Duties.

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     The Administrative Agent may execute any of its duties under this Agreement by or through
agents or attorneys-in-fact and shall be entitled to advice of counsel concerning all matters
pertaining to such duties. The Administrative Agent shall not be responsible for the negligence or
misconduct of any agents or attorneys-in-fact selected by it with reasonable care.

Section 10.3 Exculpatory Provisions.

     Neither the Administrative Agent nor any of its directors, officers, agents or employees shall
be (i) liable for any action lawfully taken or omitted to be taken by it or them under or in
connection with this Agreement (except for its, their or such Person’s own gross negligence or
willful misconduct or, in the case of the Administrative Agent, the breach of its obligations
expressly set forth in this Agreement), or (ii) responsible in any manner to any of the Secured
Parties for any recitals, statements, representations or warranties made by the Borrower contained
in this Agreement or in any certificate, report, statement or other document referred to or
provided for in, or received under or in connection with, this Agreement for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or any other document
furnished in connection herewith, or for any failure of the Borrower to perform its obligations
hereunder, or for the satisfaction of any condition specified in Article III. The
Administrative Agent shall not be under any obligation to any Secured Party to ascertain or to
inquire as to the observance or performance of any of the agreements or covenants contained in, or
conditions of, this Agreement, or to inspect the properties, books or records of the Borrower. The
Administrative Agent shall not be deemed to have knowledge of any Event of Default unless the
Administrative Agent has received notice of such Event of Default, in a document or other written
communication titled “Notice of Event of Default” from the Borrower or a Secured Party.

Section 10.4 Reliance.

     The Administrative Agent shall in all cases be entitled to rely, and shall be fully protected
in relying, upon any document or conversation believed by it to be genuine and correct and to have
been signed, sent or made by the proper Person or Persons and upon advice and statements of legal
counsel (including counsel to the Borrower), independent accountants and other experts selected by
the Administrative Agent. The Administrative Agent shall in all cases be fully justified in failing
or refusing to take any action under this Agreement or any other document furnished in connection
herewith unless it shall first receive such advice or concurrence of the Required Lenders or all of
the Secured Parties, as applicable, as it deems appropriate or it shall first be indemnified to its
satisfaction by the Lenders, provided, that, unless and until the Administrative
Agent shall have received such advice, the Administrative Agent may take or refrain from taking any
action, as the Administrative Agent shall deem advisable and in the best interests of the Secured
Parties. The Administrative Agent shall in all cases be fully protected in acting, or in refraining
from acting, in accordance with a request of the Required Lenders or all of the Secured Parties, as
applicable, and such request and any action taken or failure to act pursuant thereto shall be
binding upon all the Secured Parties.

Section 10.5 Non-Reliance on Administrative Agent and Other Lenders.

     Each Secured Party expressly acknowledges that neither the Administrative Agent, any other
Secured Party nor any of their respective officers, directors, employees, agents, attorneys-in-fact
or affiliates has made any representations or warranties to it and that no act by the
Administrative Agent or any other Secured Party hereafter taken, including any review of the
affairs of the Borrower, shall be deemed to constitute any representation or warranty by the
Administrative Agent or any other Secured Party. Each Secured Party represents and warrants to the
Administrative Agent and to each other Secured Party that it has and will, independently and
without reliance upon the Administrative Agent or any other Secured Party and based on such
documents and information as it has deemed appropriate, made its own

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appraisal of and investigation into the business, operations, property, prospects, financial
and other conditions and creditworthiness of the Borrower and made its own decision to enter into
this Agreement

Section 10.6 Reimbursement and Indemnification.

     The Lenders agree to reimburse and indemnify the Administrative Agent and it officers,
directors, employees, representatives and agents ratably according to their Commitments, as
applicable, to the extent not paid or reimbursed by the Borrower (i) for any amounts for which the
Administrative Agent, acting in its capacity as Administrative Agent is entitled to reimbursement
by the Borrower hereunder and (ii) for any other expenses incurred by the Administrative Agent, in
its capacity as Administrative Agent and acting on behalf of the related Lenders, in connection
with the administration and enforcement of this Agreement and the other Transaction Documents.

Section 10.7 Administrative Agent in its Individual Capacities.

     The Administrative Agent and its Affiliates may make loans to, accept deposits from and
generally engage in any kind of business with the Borrower or any Affiliate of the Borrower as
though the Administrative Agent were not the Administrative Agent hereunder. With respect to the
acquisition of Advances pursuant to this Agreement, the Administrative Agent and each of its
Affiliates shall have the same rights and powers under this Agreement as any Lender and may
exercise the same as though it were not the Administrative Agent and the terms “Lender” “Lender”
“Lenders” and “Lenders” shall include the Administrative Agent in its individual capacity.

Section 10.8 Successor Administrative Agent.

     The Administrative Agent may, upon five (5) days’ notice to the Borrower and the Secured
Parties, and the Administrative Agent will, upon the direction of all of the Lenders resign as
Administrative Agent. If the Administrative Agent shall resign, then the Required Lenders during
such five (5) day period shall appoint from among the Secured Parties a successor agent. If for any
reason no successor Administrative Agent is appointed by the Required Lenders during such five (5)
day period, then effective upon the expiration of such five (5) day period, the Secured Parties
shall perform all of the duties of the Administrative Agent hereunder and the Borrower shall make
all payments in respect of the Facility Obligations or under the Fee Letter delivered by the
Borrower to the Administrative Agent and the Secured Parties directly to the applicable Lenders and
for all purposes shall deal directly with the Secured Parties. After any retiring Administrative
Agent’s resignation hereunder as Administrative Agent, the provisions of Article IX and
Article X shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was Administrative Agent under this Agreement.

ARTICLE XI

ASSIGNMENTS; PARTICIPATIONS

Section 11.1 Assignments and Participations.

     (a) Assignments.

          (i) Any Lender may at any time assign to one or more Persons (any such Person, an
“Assignee”) all or any portion of such Lender’s Advances and Commitments, with the prior
written consent of the Administrative Agent and, so long as no Event of Default exists, the
Borrower (which consents shall not be unreasonably withheld or delayed and shall not be required
(i) from the Borrower for an assignment by a Lender to another Lender or an Affiliate of a Lender
or an Approved Fund of a

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Lender or (ii) from the Administrative Agent for an assignment by a Lender to an Affiliate of
a Lender or an Approved Fund of a Lender). Except as the Administrative Agent may otherwise agree,
any such assignment (other than any assignment by a Lender to a Lender or an Affiliate or Approved
Fund of a Lender) shall be in a minimum aggregate amount equal to $5,000,000 or, if less, the
Commitment or the principal amount of the Advances being assigned. The Borrower and the
Administrative Agent shall be entitled to continue to deal solely and directly with such Lender in
connection with the interests so assigned to an Assignee until the Administrative Agent shall have
received and accepted an effective Assignment Agreement executed, delivered and fully completed by
the applicable parties thereto and a processing fee of $3,500 to be paid by the Lender to whom such
interest is assigned; provided, that no such fee shall be payable in connection with any assignment
by a Lender to a Lender or an Affiliate or Approved Fund of a Lender. Any attempted assignment not
made in accordance with this Section 11.1(a)(i) shall be null and void. The Borrower shall
be deemed to have granted its consent to any assignment requiring its consent hereunder unless the
Borrower has expressly objected to such assignment within three Business Days after notice thereof.

          (ii) From and after the date on which the conditions described above have been met, (i) such
Assignee shall be deemed automatically to have become a party hereto and, to the extent that rights
and obligations hereunder have been assigned to such Assignee pursuant to such Assignment
Agreement, shall have the rights and obligations of a Lender hereunder and (ii) the assigning
Lender, to the extent that rights and obligations hereunder have been assigned by it pursuant to
such Assignment Agreement, shall be released from its rights (other than its indemnification
rights) and obligations hereunder. Upon the request of the Assignee (and, as applicable, the
assigning Lender) pursuant to an effective Assignment Agreement, the Borrower shall execute and
deliver to the Administrative Agent for delivery to the Assignee (and, as applicable, the assigning
Lender), a Note in the principal amount of the Assignee’s Pro Rata Share of the Commitment (and, as
applicable, a Note in the principal amount of the Pro Rata Share of the Commitment retained by the
assigning Lender). Each such Note shall be dated the effective date of such assignment. Upon
receipt by the assigning Lender of such Note, the assigning Lender shall return to Borrower any
prior Note held by it.

          (iii) The Administrative Agent, acting solely for this purpose as an agent of the Borrower,
shall maintain at one of its offices in the United States a copy of each Assignment Agreement
delivered to it and a register for the recordation of the names and addresses of each Lender, and
the Commitments of, and principal amount of the Advances owing to, such Lender pursuant to the
terms hereof. The entries in such register shall be conclusive, and the Borrower, the
Administrative Agent and Lenders may treat each Person whose name is recorded therein pursuant to
the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice
to the contrary. Such register shall be available for inspection by the Borrower and any Lender,
at any reasonable time upon reasonable prior notice to the Administrative Agent.

          (iv) Notwithstanding the foregoing provisions of this Section 11.1(a) or any other
provision of this Agreement, any Lender may at any time assign all or any portion of its Advances
and its Note (i) as collateral security to a Federal Reserve Bank or, as applicable, to such
Lender’s trustee for the benefit of its investors (but no such assignment shall release any Lender
from any of its obligations hereunder) and (ii) to (w) an Affiliate of such Lender which is at
least 50% owned (directly or indirectly) by such Lender or by its direct or indirect parent
company, (x) its direct or indirect parent company, (y) to one or more other Lenders or (z) to an
Approved Fund.

     (b) Participations. Any Lender may at any time sell to one or more Persons
participating interests in its Advances, Commitments or other interests hereunder (any such Person,
a “Participant”). In the event of a sale by a Lender of a participating interest to a
Participant, (a) such Lender’s obligations hereunder shall remain unchanged for all purposes, (b)
the Borrower and the Administrative Agent shall

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continue to deal solely and directly with such Lender in connection with such Lender’s rights
and obligations hereunder and (c) all amounts payable by the Borrower shall be determined as if
such Lender had not sold such participation and shall be paid directly to such Lender. No
Participant shall have any direct or indirect voting rights hereunder except with respect to any
event described in Section 12.1 expressly requiring the unanimous vote of all Lenders or,
as applicable, all affected Lenders. Each Lender agrees to incorporate the requirements of the
preceding sentence into each participation agreement which such Lender enters into with any
Participant. The Borrower agrees that if amounts outstanding under this Agreement are due and
payable (as a result of acceleration or otherwise), each Participant shall be deemed to have the
right of set-off in respect of its participating interest in amounts owing under this Agreement to
the same extent as if the amount of its participating interest were owing directly to it as a
Lender under this Agreement. Borrower also agrees that each Participant shall be entitled to the
benefits of Sections 2.11 and 2.12 as if it were a Lender (provided that no
Participant shall receive any greater compensation pursuant to Sections 2.11 and
2.12 than would have been paid to the participating Lender if no participation had been
sold).

     (c) Each Lender may, in connection with any assignment or participation or proposed assignment
or participation pursuant to this Section 11.1, disclose to the assignee or participant or
proposed assignee or participant any information relating to the Borrower, the Manager or the
Performance Guarantor furnished to such Lender by or on behalf of the Borrower, the Manager or the
Performance Guarantor.

     (d) In the event any Lender causes increased costs, expenses or Taxes to be incurred by the
Administrative Agent or the related Lender in connection with the assignment or participation of
such Lender’s rights and obligations under this Agreement to an Assignee then such Lender agrees
that it will make reasonable efforts to assign such increased costs, expenses or Taxes to such
Assignee in accordance with the provisions of this Agreement.

ARTICLE XII

MISCELLANEOUS

Section 12.1 Amendments and Waivers.

     Except as provided in this Section 12.1, no amendment, waiver or other modification of
any provision of this Agreement shall be effective without the written agreement of the Borrower,
the Performance Guarantor, the Manager, the Administrative Agent and the Required Lenders;
provided, however, that (i) without the consent of any Lender, the Administrative
Agent may, with the consent of Borrower, amend this Agreement solely to add additional Persons as
Lenders hereunder, (ii) any amendment of this Agreement that is solely for the purpose of
increasing the Commitment of a specific Lender may be effected with the written consent of the
Borrower, the Administrative Agent and the affected Lender, and (iii) the consent of each affected
Lender shall be required to: (A) extend the Commitment Termination Date or the date of any payment
or deposit of Collections by the Borrower or the Manager, (B) reduce the amount (other than by
reason of the repayment thereof) or extend the time of payment of Advances Outstanding or reduce
the rate or extend the time of payment of Interest (or any component thereof) or increase the
Commitment of such Lender, (C) reduce any fee payable to the Administrative Agent for the benefit
of the Lenders, (D) amend, modify or waive any provision of the definition of Required Lenders or
Sections 2.7, 2.10, 11.1(a), 12.1, 12.9, or 12.10,
(E) consent to or permit the assignment or transfer by the Borrower of any of its rights and
obligations under this Agreement, (F) change the definition of “Borrowing Base,” “Eligible Loan
Asset” or “Payment Date,” or (G) amend or modify any defined term (or any defined term used
directly or indirectly in such defined term) used in clauses (A) through (F) above in a manner that
would circumvent the intention of the

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restrictions set forth in such clauses. Any waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given.

     No amendment, waiver or other modification (i) affecting the rights or obligations of any
Hedge Counterparty (ii) having a material affect on the rights or obligations of the Custodian or
(iii) amending or modifying the obligations of the Performance Guarantor under Section
12.14 shall be effective against such Person without the written agreement of such Person. The
Borrower or the Manager on its behalf will deliver a copy of all waivers and amendments to the
Custodian and the Performance Guarantor.

Section 12.2 Notices, Etc.

     All notices, directions, instructions and other communications provided for hereunder shall,
unless otherwise expressly stated herein, be in writing (which shall include facsimile
communication and communication by e-mail) and mailed, faxed, e-mailed or delivered, as to each
party hereto, at its address set forth on Schedule VII or specified in such party’s Assignment
Agreement or at such other address as shall be designated by such party in a written notice to the
other parties hereto. Notices and communications by facsimile and e-mail shall be effective when
sent (and shall be followed by hard copy sent by regular mail), and notices and communications sent
by other means shall be effective when received.

Section 12.3 No Waiver, Rights and Remedies.

     No failure on the part of the Administrative Agent or any Secured Party or any assignee of any
Secured Party to exercise, and no delay in exercising, any right or remedy hereunder shall operate
as a waiver thereof; nor shall any single or partial exercise of any right or remedy hereunder
preclude any other or further exercise thereof or the exercise of any other right. The rights and
remedies herein provided are cumulative and not exclusive of any rights and remedies provided by
law.

Section 12.4 Binding Effect.

     This Agreement shall be binding upon and inure to the benefit of the Borrower, the
Administrative Agent, the Secured Parties and their respective successors and permitted assigns
and, in addition, the provisions of Section 2.7 shall inure to the benefit of each Hedge
Counterparty, whether or not that Hedge Counterparty is a Secured Party.

Section 12.5 Term of this Agreement.

     This Agreement, including the Borrower’s obligation to observe its covenants set forth in
Article V and the Manager’s obligation to observe its covenants set forth in Article
VII, shall remain in full force and effect until the Collection Date; provided,
however, that the rights and remedies with respect to any breach of any representation and
warranty made or deemed made by the Borrower pursuant to Articles III and IV and
the indemnification and payment provisions of Article IX and Article X and the
provisions of Section 12.9 and Section 12.10 shall be continuing and shall survive
any termination of this Agreement.

Section 12.6 GOVERNING LAW; CONSENT TO JURISDICTION; WAIVER OF OBJECTION TO VENUE.

     THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE
OF NEW YORK. EACH OF THE SECURED PARTIES, THE BORROWER AND THE ADMINISTRATIVE AGENT HEREBY AGREES
TO THE NON-EXCLUSIVE JURISDICTION OF ANY FEDERAL COURT LOCATED WITHIN THE STATE OF

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NEW YORK. EACH OF THE PARTIES HERETO AND EACH SECURED PARTY HEREBY WAIVES ANY OBJECTION BASED
ON FORUM NON CONVENIENS, AND ANY OBJECTION TO VENUE OF ANY ACTION INSTITUTED HEREUNDER IN ANY OF
THE AFOREMENTIONED COURTS AND CONSENTS TO THE GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS
DEEMED APPROPRIATE BY SUCH COURT.

Section 12.7 WAIVER OF JURY TRIAL.

     TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH OF THE SECURED PARTIES, THE BORROWER AND THE
ADMINISTRATIVE AGENT WAIVES ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER
SOUNDING IN CONTRACT, TORT, OR OTHERWISE BETWEEN THE PARTIES HERETO ARISING OUT OF, CONNECTED WITH,
RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP BETWEEN ANY OF THEM IN CONNECTION WITH THIS AGREEMENT
OR THE TRANSACTIONS CONTEMPLATED HEREBY. INSTEAD, ANY SUCH DISPUTE RESOLVED IN COURT WILL BE
RESOLVED IN A BENCH TRIAL WITHOUT A JURY.

Section 12.8 Costs, Expenses and Taxes.

     (a) In addition to the rights of indemnification granted to the Administrative Agent the other
Secured Parties and its or their Affiliates and officers, directors, employees and agents thereof
under Article IX hereof, the Borrower agrees to pay on demand all reasonable costs and
expenses of the Administrative Agent and the other Secured Parties incurred in connection with the
preparation, execution, delivery, administration (including periodic auditing, inspection and
valuation), amendment or modification of, or any waiver or consent issued in connection with, this
Agreement and the other documents to be delivered hereunder or in connection herewith, including
the reasonable fees and out-of-pocket expenses of counsel for the Administrative Agent and the
other Secured Parties with respect thereto and with respect to advising the Administrative Agent
and the other Secured Parties as to their respective rights and remedies under this Agreement and
the other documents to be delivered hereunder or in connection herewith, and all costs and
expenses, if any (including reasonable counsel fees and expenses), incurred by the Administrative
Agent or the other Secured Parties in connection with the enforcement of this Agreement and the
other documents to be delivered hereunder or in connection herewith (including any Hedge
Agreement).

     (b) The Borrower shall pay on demand any and all stamp, sales, excise and other taxes and fees
payable or determined to be payable in connection with the execution, delivery, filing and
recording of this Agreement, the other documents to be delivered hereunder or any agreement or
other document providing liquidity support, credit enhancement or other similar Support to the
Lender in connection with this Agreement or the funding or maintenance of Advances hereunder.

     (c) The Borrower shall pay on demand all other costs, expenses and Taxes (excluding income
Taxes and other amounts described under Section 2.12 as not being payable or reimbursable
by the Borrower) (“Other Costs”), including all reasonable costs and expenses incurred by
the Administrative Agent in connection with periodic audits and valuations of the Loan Assets and
the Borrower’s or the Manager’s books and records, which are incurred as a result of the execution
of this Agreement.

Section 12.9 No Proceedings.

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     Each of the parties hereto (other than the Administrative Agent) hereby agrees that it will
not institute against, or join any other Person in instituting against the Borrower any Insolvency
Proceeding so long as there shall not have elapsed one (1) year and one (1) day since the
Collection Date.

Section 12.10 Recourse Against Certain Parties.

     No recourse under or with respect to any obligation, covenant or agreement (including the
payment of any fees or any other obligations) of the Administrative Agent or any Secured Party as
contained in this Agreement or any other agreement, instrument or document entered into by it
pursuant hereto or in connection herewith shall be had against any manager or administrator of such
Person or any incorporator, affiliate, stockholder, officer, employee or director of such Person or
of the Borrower or of any such manager or administrator, as such, by the enforcement of any
assessment or by any legal or equitable proceeding, by virtue of any statute or otherwise. The
provisions of this Section 12.10 shall survive the termination of this Agreement.

Section 12.11 Protection of Security Interest; Appointment of Administrative Agent as Attorney-in-Fact.

     (a) The Borrower shall, or shall cause the Manager to, cause this Agreement, all amendments
hereto and/or all financing statements and continuation statements and any other necessary
documents covering the right, title and interest of the Administrative Agent, for the benefit of
the Secured Parties, and of the Secured Parties to the Collateral to be promptly recorded,
registered and filed, and at all time to be kept recorded, registered and filed, all in such manner
and in such places as may be required by law fully to preserve and protect the right, title and
interest of the Administrative Agent, for the benefit of the Secured Parties hereunder to all
property comprising the Collateral. The Borrower shall deliver or, shall cause the Manager to
deliver, to the Custodian and the Administrative Agent file-stamped copies of, or filing receipts
for, any document recorded, registered or filed as provided above, as soon as available following
such recording, registration or filing. The Borrower and the Manager shall cooperate fully in
connection with the obligations set forth above and will execute any and all documents reasonably
required to fulfill the intent of this Section 12.11.

     (b) The Borrower agrees that from time to time, at its expense, it will promptly execute and
deliver all instruments and documents, and take all actions, that may reasonably be necessary or
desirable, or that the Custodian or the Administrative Agent may reasonably request, to perfect,
protect or more fully evidence the security interest granted to the Administrative Agent, for the
benefit of the Secured Parties, in the Collateral, or to enable the Custodian, the Administrative
Agent or the Secured Parties to exercise and enforce their rights and remedies hereunder.

     (c) If the Borrower or the Manager fails to perform any of its obligations hereunder after
five (5) Business Days’ notice from the Custodian or the Administrative Agent, the Administrative
Agent or any Lender may (but shall not be required to) perform, or cause performance of, such
obligation; and the Administrative Agent’s or such Lender’s reasonable costs and expenses incurred
in connection therewith shall be payable by the Borrower (if the Manager that fails to so perform
is the Borrower or an Affiliate thereof) as provided in Article IX, as applicable. The
Borrower irrevocably authorizes the Administrative Agent and appoints the Administrative Agent as
its attorney-in-fact to act on behalf of the Borrower, (i) to authorize on behalf of the Borrower
as debtor and to file financing statements necessary or desirable in the Custodian’s or the
Administrative Agent’s discretion to perfect and to maintain the perfection and priority of the
interest of the Secured Parties in the Collateral and (ii) to file a carbon, photographic or other
reproduction of this Agreement or any financing statement with respect to the Collateral as a
financing statement in such offices as the Custodian or the Administrative Agent in its discretion
deems

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necessary or desirable to perfect and to maintain the perfection and priority of the interests
of the Lenders in the Collateral. This appointment is coupled with an interest and is irrevocable.

     (d) Without limiting the generality of the foregoing, Borrower will, not earlier than six (6)
months and not later than three (3) months prior to the fifth anniversary of the date of filing of
the financing statement referred to in Section 3.1 or any other financing statement filed
pursuant to this Agreement or in connection with any Advance hereunder, unless the Collection Date
shall have occurred:

     (i) execute and deliver and file or cause to be filed an appropriate continuation statement
with respect to such financing statement; and

     (ii) deliver or cause to be delivered to the Custodian and the Administrative Agent an
opinion of counsel for Borrower, in form and substance reasonably satisfactory to the Custodian
and the Administrative Agent, confirming and updating the opinion delivered pursuant to
Section 3.1 with respect to perfection and otherwise to the effect that the Collateral
hereunder continues to be subject to a perfected security interest in favor of the
Administrative Agent, for the benefit of the Secured Parties, subject to no other Liens of
record except as provided herein or otherwise permitted hereunder, which opinion may contain
usual and customary assumptions, limitations and exceptions.

Section 12.12 Confidentiality.

     (a) Each of the Administrative Agent, the other Secured Parties and the Borrower shall
maintain and shall cause each of its employees and officers to maintain the confidentiality of the
Agreement and the other confidential proprietary information with respect to the other parties
hereto and their respective businesses obtained by it or them in connection with the structuring,
negotiating and execution of the transactions contemplated herein, except that each such party and
its officers and employees may (i) disclose such information (x) to its external accountants,
auditors, attorneys or other agents, including any valuation firm engaged by such party in
connection with due diligence or the administration of this Agreement and the Loan Assets and (y)
as required by Applicable Law, as required to be publicly filed with the SEC, or as required by an
order or request of any judicial, regulatory or administrative authority or proceeding, (ii)
disclose the existence of this Agreement, but not the financial terms thereof and (iii) disclose
this Agreement and such information in any suit, action, proceeding or investigation (whether in
law or in equity or pursuant to arbitration) involving any of the Loan Asset Documents or any
Hedging Agreement for the purpose of defending itself, reducing itself, reducing its liability, or
protecting or exercising any of its claims, rights, remedies, or interests under or in connection
with any of the Loan Asset Documents or any Hedging Agreement.

     (b) Anything herein to the contrary notwithstanding, the Borrower hereby consents to the
disclosure of any nonpublic information with respect to it for use in connection with the
transactions contemplated herein and in the Transaction Documents (i) to the Administrative Agent
or the Secured Parties by each other, (ii) by the Administrative Agent or the Secured Parties to
any prospective or actual Assignee or participant of any of them or (iii) by the Administrative
Agent or the Secured Parties to any rating agency and to any officers, directors, members,
employees, outside accountants and attorneys of any of the foregoing, provided each such Person is
informed of the confidential nature of such information and agree to be bound hereby. In addition,
the Secured Parties and the Administrative Agent may disclose any such nonpublic information
pursuant to any law, rule, regulation, direction, request or order of any judicial, administrative
or regulatory authority or proceedings.

     (c) Notwithstanding anything herein to the contrary, the foregoing shall not be construed to
prohibit (i) disclosure of any and all information that is or becomes publicly known; (ii)
disclosure of any and all information (a) if required to do so by any applicable statute, law, rule
or regulation, (b) to any

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government agency or regulatory body having or claiming authority to regulate or oversee any
respects of the Administrative Agent’s, any Lender’s or the Custodian’s business or that of their
affiliates, (c) pursuant to any subpoena, civil investigative demand or similar demand or request
of any court, regulatory authority, arbitrator or arbitration to which the Administrative Agent,
any Lender or the Custodian or an officer, director, employer, shareholder or affiliate of any of
the foregoing is a party, or (d) to any affiliate, independent or internal auditor, agent, employee
or attorney of the Custodian having a need to know the same, provided that the disclosing
party advises such recipient of the confidential nature of the information being disclosed; or
(iii) any other disclosure authorized by the Borrower or the Manager.

     (d) The Borrower and the Manager each agrees that it shall not (and shall not permit any of
its Affiliates to) issue any news release or make any public announcement pertaining to the
transactions contemplated by this Agreement and the Transaction Documents without the prior written
consent of the Administrative Agent (which consent shall not be unreasonably withheld) unless such
news release or public announcement is required by law, rule or regulation, in which case the
Borrower or the Manager shall consult with the Administrative Agent prior to the issuance of such
news release or public announcement. The Borrower and the Manager each may, however, disclose the
general terms of the transactions contemplated by this Agreement and the Transaction Documents to
trade creditors, suppliers and other similarly-situated Persons so long as such disclosure is not
in the form of a news release or public announcement.

Section 12.13 Execution in Counterparts; Severability; Integration.

     This Agreement may be executed in any number of counterparts and by different parties hereto
in separate counterparts, each of which when so executed shall be deemed to be an original and all
of which when taken together shall constitute one and the same agreement. Delivery of an executed
counterpart of a signature page to this Agreement or any other Transaction Document by e-mail in
portable document format (.pdf) or facsimile shall be effective as delivery of a manually executed
counterpart of this Agreement or such other Transaction Document. In case any provision in or
obligation under this Agreement shall be invalid, illegal or unenforceable in any jurisdiction, the
validity, legality and enforceability of the remaining provisions or obligations, or of such
provision or obligation in any other jurisdiction, shall not in any way be affected or impaired
thereby. This Agreement contains the final and complete integration of all prior expressions by the
parties hereto with respect to the subject matter hereof and shall constitute the entire agreement
among the parties hereto with respect to the subject matter hereof, superseding all prior oral or
written understandings other than the Fee Letter.

Section 12.14 Performance Undertaking.

     (a) Performance Guaranty. GSC Investment, as guarantor (the “Performance
Guarantor”), hereby guarantees to the Administrative Agent on behalf of the Lenders and the
other Secured Parties, the full and punctual performance by the Borrower of its obligation to make
a repayment in respect of, or substitute an Eligible Loan Asset for, each Ineligible Loan Asset
that is an Ineligible Collateral Debt Obligation (as such term is defined in the Purchase
Agreement) pursuant to Section 2.4(c) (the “Repayment Obligation”). This guaranty
is an absolute, unconditional and continuing guaranty of the full and punctual performance of the
Repayment Obligation and is in no way conditioned upon any requirement that the Administrative
Agent or the Secured Parties first attempt to collect any of the amounts owing to them in respect
of the Repayment Obligation from the Borrower or resort to any Collateral or other means of
obtaining payment therefor.

     (b) Performance Guarantor’s Further Agreements to Pay. The Performance Guarantor
further agrees, as the principal obligor and not as a guarantor only, to pay to the Administrative
Agent on

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behalf of the Secured Parties, forthwith upon demand in funds immediately available to the
Administrative Agent, all reasonable costs and expenses (including court costs and reasonable legal
expenses) incurred or expended by the Administrative Agent, or any of the Secured Parties in
connection with the collection of all or a portion of any losses, incurred as a result of the
breach of the Repayment Obligation, together with interest on amounts recoverable under this
guaranty equal to the Base Rate.

     (c) Waivers by Performance Guarantor; Administrative Agent’s and Lenders’ Freedom to
Act. The Performance Guarantor waives (i) notice of acceptance of this guaranty, (ii) notice of
any action taken or omitted by the Administrative Agent or any Lender in reliance on this guaranty,
and any requirement that the Administrative Agent and the Lenders be diligent or prompt in making
demands under this guaranty or asserting any other rights of the Administrative Agent or any Lender
under this guaranty. The Performance Guarantor also irrevocably waives all defenses that at any
time may be available in respect of these obligations by virtue of any statute of limitations,
valuation, stay, moratorium law or other similar law now or thereafter in effect. Each of the
Administrative Agent and the Lenders shall be at liberty, without giving notice to or obtaining the
consent of the Performance Guarantor, to deal with the Borrower, in such manner as the
Administrative Agent or any Lender in its reasonable discretion deems fit under the terms of this
Agreement, and to this end the Performance Guarantor agrees that the validity and enforceability of
this guaranty shall not be impaired or affected by any of the following: (A) any extension,
increase, modification or renewal of, or indulgence with respect to, or substitutions for, the
Repayment Obligation or any part thereof or any agreement relating thereto at any time; (B) any
failure or omission to enforce any right, power or remedy with respect to the Repayment Obligation
or any part thereof or any agreement relating thereto, or any collateral securing the Repayment
Obligation or any part thereof; (C) any waiver of any right, power or remedy or of any default with
respect to the Repayment Obligation or any part thereof or any agreement relating thereto; (D) any
release, surrender, compromise, settlement, waiver, subordination or modification, with or without
consideration, of any other obligation of any person or entity with respect to the Repayment
Obligation or any part thereof, it being understood that any portion of the Repayment Obligation
which is released, surrendered, compromised, settled, waived, subordinated or otherwise modified by
the Administrative Agent pursuant to the terms of the applicable Transaction Document shall no
longer be a Repayment Obligation hereunder to the extent of such modification; (E) the
enforceability or validity of the Repayment Obligation or any part thereof or the genuineness,
enforceability or validity of any agreement relating thereto or with respect to the Repayment
Obligation or any part thereof; (F) the existence of any claim, setoff or other rights which the
Performance Guarantor may have at any time against the Borrower in connection herewith or any
unrelated transaction; (G) any assignment or transfer of the benefits of the Repayment Obligation
or any part thereof permitted under the Credit Agreement; or (H) any failure on the part of the
Borrower to perform or comply with any term of the Credit Agreement or other Transaction Document,
all whether or not the Performance Guarantor shall have had notice or knowledge of any act or
omission referred to in the foregoing clauses (A) through (H) of this clause (c).

     (d) Unenforceability of Obligations Against Borrower. Notwithstanding (a) any change
of ownership of the Borrower or the insolvency, bankruptcy or any other change in the legal status
of the Borrower; (b) the change in or the imposition of any law, decree, regulation or other
governmental act; (c) the failure of the Borrower or the Performance Guarantor to maintain in full
force, validity or effect or to obtain or renew when required all governmental and other approvals,
licenses or consents required in connection with the Repayment Obligation or this guaranty, or to
take any other action required in connection with the performance of all obligations pursuant to
the Repayment Obligation or this guaranty; or (d) if any of the moneys payable in respect of the
Repayment Obligation have become irrecoverable from the Borrower for any other reason other than
final payment in full of the Repayment Obligation which constitute payment obligations, in
accordance with their terms, this guaranty shall nevertheless be binding on the Performance
Guarantor..

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     (e) Compliance with Laws. The Performance Guarantor will comply with all Applicable
Laws with respect to it, its business and properties and all Collateral, except where the failure
to do so, individually or in the aggregate, could not reasonably be expected to have a Material
Adverse Effect.

     (f) Preservation of Existence. The Performance Guarantor will (i) preserve and
maintain its existence in good standing and its rights, franchises and privileges in the
jurisdiction of its formation, and (ii) qualify and remain qualified in good standing in each
jurisdiction where the failure to maintain such qualification has had, or could reasonably be
expected to have, a Material Adverse Effect.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

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

	 	 	 	 	 
	BORROWER: 	GSC INVESTMENT FUNDING LLC

 	 
	 	By  	/s/ Seth M. Katzenstein
 	 
	 	 	Name:  	Seth M. Katzenstein 	 
	 	 	Title:  	President and Secretary 	 
	 
	MANAGER: 	SARATOGA INVESTMENT ADVISORS, LLC

 	 
	 	By  	/s/ Richard A. Petrocelli
 	 
	 	 	Name:  	Richard A. Petrocelli 	 
	 	 	Title:  	Managing Director 	 
	 
	PERFORMANCE GUARANTOR: 	GSC INVESTMENT CORP.

 	 
	 	By  	/s/ Seth M. Katzenstein
 	 
	 	 	Name:  	Seth M. Katzenstein 	 
	 	 	Title:  	President and Chief Executive Officer 	 
	 
	 	MADISON CAPITAL FUNDING LLC, as 

Administrative Agent and a Lender

 	 
	 	By  	/s/ Devon Russell
 	 
	 	 	Name:  	Devon Russell 	 
	 	 	Title:  	Senior Managing Director 	 
	 
	 	U.S. BANK NATIONAL ASSOCIATION, not in 

its individual capacity, but solely as Custodian

 	 
	 	By  	/s/ C. Brand Hosford
 	 
	 	 	Name:  	C. Brand Hosford 	 
	 	 	Title:  	Vice President 	 
	 

Signature Page to Credit Agreement

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