Document:

Exhibit 10.3

 

 

 

 

 

LOAN SALE AND CONTRIBUTION AGREEMENT

between

 

SARATOGA INVESTMENT CORP.,

as Seller

and

 

SARATOGA INVESTMENT FUNDING II LLC,

as Purchaser

Dated as of October 4, 2021

 

 

 

 

 

     

     

    

 

TABLE OF CONTENTS

 

	 	 	Page
	ARTICLE I	DEFINITIONS	1
	 	 	 
	SECTION 1.1	Definitions.	1
	SECTION 1.2	Other Terms.	2
	SECTION 1.3	Computation of Time Periods.	3
	SECTION 1.4	Interpretation.	3
	 	 	 
	ARTICLE II	CONVEYANCES OF TRANSFERRED ASSETS	4
	 	 	 
	SECTION 2.1	Conveyances.	4
	SECTION 2.2	[Reserved].	7
	SECTION 2.3	Indemnification.	7
	SECTION 2.4	Administrative Convenience.	8
	 	 	 
	ARTICLE III	CONSIDERATION AND PAYMENT; REPORTING	8
	 	 	 
	SECTION 3.1	Purchase Price.	8
	SECTION 3.2	Payment of Purchase Price.	8
	 	 	 
	ARTICLE IV	REPRESENTATIONS AND WARRANTIES	9
	 	 	 
	SECTION 4.1	Seller’s Representations and Warranties.	9
	SECTION 4.2	Reaffirmation of Representations and Warranties by the Seller; Notice of Breach.	15
	 	 	 
	ARTICLE V	COVENANTS	15
	 	 	 
	SECTION 5.1	Protection of Title of the Purchaser.	15
	SECTION 5.2	Covenants of the Seller.	17
	SECTION 5.3	Negative Covenants of the Seller.  From the date hereof until the Final Maturity Date:	20
	 	 	 
	ARTICLE VI	WARRANTY LOANS	21
	 	 	 
	SECTION 6.1	Warranty Collateral Loans.	21
	SECTION 6.2	Limitation on Sales to Seller and Affiliates.	22
	 	 	 
	ARTICLE VII	CONDITIONS PRECEDENT	22
	 	 	 
	SECTION 7.1	Conditions Precedent to Effectiveness.	22
	SECTION 7.2	Conditions Precedent to all Conveyances.	23

 

     

     

    

 

	ARTICLE VIII	[Reserved]	24
	 	 	 
	ARTICLE IX	ADDITIONAL RIGHTS AND OBLIGATIONS IN RESPECT OF THE TRANSFERRED ASSETS	24
	 	 	 
	SECTION 9.1	Rights of the Purchaser.	24
	SECTION 9.2	Notice to Collateral Agent and Administrative Agent.	24
	 	 	 
	ARTICLE X	MISCELLANEOUS PROVISIONS	25
	 	 	 
	SECTION 10.1	Amendments, Etc.	25
	SECTION 10.2	Limitation on Liability.	25
	SECTION 10.3	Governing Law: Submission to Jurisdiction.	25
	SECTION 10.4	Notices.	26
	SECTION 10.5	Severability of Provisions.	26
	SECTION 10.6	Further Assurances.	27
	SECTION 10.7	No Waiver; Cumulative Remedies.	27
	SECTION 10.8	Costs, Expenses and Taxes.	27
	SECTION 10.9	Counterparts.	27
	SECTION 10.10	Binding Effect; Assignability; Third-Party Beneficiaries.	27
	SECTION 10.11	Merger and Integration.	27
	SECTION 10.12	Non-Petition.	28
	SECTION 10.13	Waiver of Setoff.	28
	SECTION 10.14	Subordination.	28
	SECTION 10.15	Headings.	28

 

SCHEDULES AND EXHIBITS

 

	Schedule A	-	Schedule of Collateral Loans
	 	 	 
	Schedule B	-	Seller Information
	 	 	 
	Exhibit A	-	Form of Purchase Notice

 

     

     

    

 

This LOAN SALE AND CONTRIBUTION
AGREEMENT, dated as of October 4, 2021 (as amended, supplemented or otherwise modified and in effect from time to time, this “Agreement”),
between SARATOGA INVESTMENT CORP., a Maryland corporation, as seller (in such capacity, the “Seller”), and SARATOGA
INVESTMENT FUNDING II LLC, a Delaware limited liability company, as purchaser (in such capacity, the “Purchaser”).

 

W I T N E S S E T H:

 

WHEREAS, the Purchaser desires
to purchase certain loans, bonds and related assets existing on the Closing Date and from time to time thereafter;

 

WHEREAS, the Seller may also
wish to contribute certain loans, bonds and related assets to the Purchaser from time to time on each Purchase Date;

 

WHEREAS, the Seller desires
to sell, transfer, assign and contribute such loans, bonds and related contracts to the Purchaser upon the terms and conditions hereinafter
set forth;

 

NOW, THEREFORE, for good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, it is hereby agreed by and between the Purchaser
and the Seller as follows:

 

ARTICLE
I

DEFINITIONS

 

SECTION 1.1 
Definitions. As used in this Agreement, 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). All capitalized terms used herein but not defined herein shall
have the respective meanings specified in, or incorporated by reference into, the Credit and Security Agreement, dated as of the date
hereof (as amended, supplemented or otherwise modified and in effect from time to time, the “Credit Agreement”), by
and among the Purchaser, as borrower, the Seller, in its capacity as Collateral Manager, the Seller, in its capacity as Equityholder,
the Lenders from time to time party hereto, Encina Lender Finance, LLC, as administrative agent (the “Administrative Agent”),
Encina Lender Finance, LLC, as collateral agent (the “Collateral Agent”), and U.S. Bank National Association, as collateral
custodian (the “Custodian”) and collateral administrator (the “Collateral Administrator”).

 

“Agreement” has the meaning set
forth in the preamble hereto.

 

“Convey”
means to sell, transfer, assign, contribute or otherwise convey assets hereunder.

 

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“Conveyance”
means, as the context may require, the Initial Conveyance or a Subsequent Conveyance.

 

“Indemnified Amounts”
has the meaning in Section 2.3.

 

“Indemnified Party”
has the meaning set forth in Section 2.3.

 

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

 

“Initial Conveyance”
has the meaning set forth in Section 2.1(a).

 

“Purchase Date”
means each Subsequent Conveyance Date and the date of the Initial Conveyance.

 

“Purchase Notice”
has the meaning set forth in Section 2.1(b).

 

“Purchase Price”
has the meaning set forth in Section 3.1.

 

“Purchaser”
has the meaning set forth in the preamble hereto.

 

“Repurchase Amount”
means, for any Warranty Collateral Loan for which a payment or substitution is being made pursuant to this Agreement as of any time of
determination, an amount equal to the Purchase Price paid by the Purchaser for such Collateral Loan less all payments of Principal Proceeds
received in connection with such Collateral Loan since the date it became a Transferred Collateral Loan plus any accrued and unpaid interest
thereon since the last Payment Date.

 

“Schedule of Collateral Loans”
has the meaning set forth in Section 2.1(a).

 

“Seller”
has the meaning set forth in the preamble hereto.

 

“Subsequent Conveyance” has the
meaning set forth in Section 2.1(b).

 

“Subsequent Conveyance
Date” has the meaning set forth in Section 2.1(b).

 

“Transferred Assets”
means, collectively, the Transferred Collateral Loans and Related Security Conveyed by the Seller to the Purchaser hereunder.

 

“Transferred Collateral
Loans” means each Collateral Loan Conveyed from the Seller to the Purchaser pursuant to the terms of this Agreement.

 

“Warranty Collateral
Loans” has the meaning set forth in Section 6.1.

 

SECTION 1.2 
Other Terms. All accounting terms not specifically defined herein shall be construed in accordance with generally accepted
accounting principles. All terms used in Article 9 of the UCC, and not specifically defined herein, are used herein as defined in such
Article 9. The term “including” when used in this Agreement means “including without limitation.”

 

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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” both mean “to but excluding.”

 

SECTION 1.4 
Interpretation.

 

(a)
Unless otherwise specified therein, all terms defined in this Agreement have the meanings as so defined herein when used in the
Credit Agreement or any other Facility Document, certificate, report or other document made or delivered pursuant hereto or thereto.

 

(b)
Singular words shall connote the plural as well as the singular and vice versa (except as indicated), as may be appropriate.

 

(c)
The words “herein,” “hereof” and “hereunder” and other words of similar import used in this
Agreement refer to this Agreement as a whole and not to any particular article, schedule, section, paragraph, clause, exhibit or other
subdivision thereof.

 

(d)
The headings, subheadings and table of contents set forth in this Agreement are solely for convenience of reference and shall not
constitute a part of this Agreement nor shall they affect the meaning, construction or effect of any provision hereof.

 

(e)
References in this Agreement to “include” or “including” shall mean include or including, as applicable,
without limiting the generality of any description preceding such term, and for purposes hereof the rule of ejusdem generis shall
not be applicable to limit a general statement, followed by or referable to an enumeration of specific matters, to matters similar to
those specifically mentioned.

 

(f)  
Any definition of or reference to this Agreement or any other Facility Document, agreement, instrument or other document shall
be construed as referring to this Agreement or such other Facility Document, instrument or other document as from time to time amended,
restated, supplemented or otherwise modified (subject to any restrictions on such amendments, restatements, supplements or modifications
set forth herein or any other Facility Document).

 

(g)
Any reference in this Agreement or any Facility Document, including the introduction and recitals to this Agreement or such Facility
Document, to any Person shall be construed to include such Person’s successors and assigns (subject to any restrictions set forth
herein or in any other applicable agreement).

 

(h)
Any reference to any Law or regulation herein shall refer to such Law or regulation as amended, modified or supplemented from time
to time.

 

(i)   
Any use of the term “knowledge” in this Agreement shall mean knowledge after due inquiry.

 

(j)   
An Event of Default shall be deemed to be continuing until it is cured or waived in accordance with Section 12.01 of the
Credit Agreement.

 

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ARTICLE
II

CONVEYANCES OF TRANSFERRED ASSETS

 

SECTION 2.1 
Conveyances.

 

(a)
On the terms and subject to the conditions set forth in this Agreement, the Seller agrees to (i) Convey to the Purchaser, without
recourse except to the extent specifically provided herein, on the Closing Date, and the Purchaser agrees to purchase or receive as a
contribution, as applicable, from the Seller on the Closing Date (the “Initial Conveyance”), all of the Seller’s
right, title and interest in and to each Collateral Loan listed on Schedule A to this Agreement (as such schedule may be amended,
supplemented, updated or otherwise modified from time to time, collectively, the “Schedule of Collateral Loans”), together
with all other Related Security and all proceeds of the foregoing and (ii) to transfer, or cause the deposit into, the Collection Account
of all Collections received by the Seller on account of any of such Transferred Assets on and after the Closing Date within two Business
Days of the receipt thereof. The Seller hereby acknowledges that the Initial Conveyance is absolute and irrevocable, without reservation
or retention of any interest whatsoever by the Seller.

 

(b)
In the event the Purchaser agrees, from time to time after the Closing Date but prior to an Event of Default, to acquire additional
Collateral Loans (including Related Security) from the Seller, the Purchaser shall deliver written notice thereof to the Administrative
Agent substantially in the form set forth in Exhibit A hereto (each, a “Purchase Notice”), designating the date
of the proposed Conveyance (a “Subsequent Conveyance Date”) and attaching a supplement to the Schedules of Collateral
Loans identifying the Collateral Loan and Related Security proposed to be Conveyed. On the terms and subject to the conditions set forth
in this Agreement and the Credit Agreement, the Seller shall (i) Convey to the Purchaser without recourse (except to the extent specifically
provided herein), and the Purchaser shall purchase or receive, as applicable, on the applicable Subsequent Conveyance Date (each such
purchase and sale being herein called a “Subsequent Conveyance”), all of the Seller’s right, title and interest
in and to each Collateral Loan then reported by the Seller on the Schedule of Collateral Loans attached to the related Purchase Notice,
together with all other Related Security and all proceeds of the foregoing and (ii) to transfer, or cause the deposit into, the Collection
Account of all Collections received by the Seller on account of any Transferred Assets hereunder on and after the Purchase Date with respect
to such Transferred Assets within two Business Days of the receipt thereof. The Seller hereby acknowledges that each Subsequent Conveyance
to the Purchaser hereunder is absolute and irrevocable, without reservation or retention of any interest whatsoever by the Seller.

 

(c)
On and after each Purchase Date hereunder, the Purchaser shall own the Transferred Assets Conveyed by the Seller to the Purchaser
on such Purchase Date, and the Seller shall not take any action inconsistent with such ownership and shall not claim any ownership interest
in such Transferred Assets.

 

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(d)
It is the express intent of the Seller and the Purchaser that each Conveyance of Transferred Assets by the Seller to the Purchaser
pursuant to this Agreement be construed as an absolute sale and/or contribution of such Transferred Assets by the Seller to the Purchaser
providing the Purchaser with the full risks and benefits of ownership of the Transferred Assets. Further, it is not the intention of the
Seller and the Purchaser that any purchase be deemed a grant of a security interest in the Transferred Assets by the Seller to the Purchaser
to secure a debt or other obligation of the Seller. However, in the event that, notwithstanding the intent of the parties, the Conveyances
hereunder shall be characterized as loans and not as sales and/or contributions, then (i) this Agreement also shall be deemed to
be, and hereby is, a security agreement within the meaning of the UCC and other applicable law, (ii) the Conveyances by the Seller
provided for in this Agreement shall be deemed to be, and the Seller hereby grants to the Purchaser, a security interest (and such security
interest is hereby assigned by the Purchaser to the Collateral Agent, for the benefit of the Secured Parties) in, to and under all of
the Seller’s right, title and interest in, to and under, whether now owned or hereafter acquired, such Transferred Assets and all
proceeds of the foregoing, (iii) the possession by the Purchaser (or the Custodian on behalf of the Collateral Agent, for the benefit
of the Secured Parties) of such Transferred Assets and such other items of property constitute instruments, money, negotiable documents
or chattel paper shall be, subject to clause (iv), for purposes of perfecting the security interest pursuant to the UCC and
(iv) acknowledgements from Persons holding such property shall be deemed acknowledgements from custodians, bailees or agents (as applicable)
of the Purchaser for the purpose of perfecting such security interest under Applicable Law. The Purchaser and its assignees shall have,
with respect to such Transferred Assets and other related rights, in addition to all the other rights and remedies available to the Purchaser
and its assignees and under the other Facility Documents, all the rights and remedies of a secured party under any applicable UCC.

 

(e)
The Seller and the Purchaser shall, to the extent consistent with this Agreement, take such actions as may be necessary to ensure
that, if this Agreement were deemed to create a security interest in the Transferred Assets to secure a debt or other obligation, such
security interest would be deemed to be a perfected security interest in favor of the Purchaser under applicable law and will be maintained
as such throughout the term of this Agreement. The Seller represents and warrants that the Transferred Assets are being transferred with
the intention of removing them from the Seller’s estate pursuant to Section 541 of the Bankruptcy Code.

 

(f) Neither the Purchaser nor any assignee of the Purchaser (including the Secured Parties) shall have any obligation or liability
to any Obligor or client of the Seller (including any obligation to perform any obligation of the Seller, including with respect to any
other related agreements) in respect of the Transferred Assets (other than with respect to funding obligations to Obligors pursuant to
the terms of the applicable Underlying Loan Agreement for Delayed Drawdown Collateral Loans). No such obligation or liability is intended
to be assumed by the Purchaser or any assignee of the Purchaser (including the Secured Party) and any such assumption is expressly disclaimed.
Without limiting the generality of the foregoing, the Conveyance of the Transferred Assets by the Seller to the Purchaser pursuant to
this Agreement does not constitute and is not intended to result in a creation or assumption by the Purchaser or any assignee of the Purchaser
(including the Secured Parties), of any obligation of the Seller, as lead agent, collateral agent or paying agent under any Collateral
Loan which is agented by a Person as part of a syndicated loan transaction.

 

(g)
Actions of the Seller in connection with each Conveyance.

 

(i) In
connection with each Conveyance of a Transferred Asset hereunder, the Seller (on behalf of the Purchaser) shall deliver, or cause to
be delivered, the Collateral Loan Documents and any other required documents in accordance with the Credit Agreement.

 

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(ii)
The Seller shall provide all information, and any other reasonable assistance, to Custodian and the Collateral Agent necessary
for the Custodian and the Collateral Agent, as applicable, to conduct the management, administration and collection of each Transferred
Asset Conveyed hereunder in accordance with the terms of the Credit Agreement.

 

(iii)
In connection with each Conveyance of a Transferred Asset hereunder, the Seller hereby grants to each of the Purchaser and its
assigns, the Administrative Agent, the Lenders, the Collateral Agent and the Custodian an irrevocable, non-exclusive license to use, without
royalty or payment of any kind, all software used by the Seller to account for the Transferred Assets, to the extent necessary to administer
the Transferred Assets, whether such software is owned by the Seller or is owned by others and used by the Seller under license agreements
with respect thereto; provided that, should the consent of any licensor of such software be required for the grant of the license
described herein to be effective, the Seller hereby agrees that upon the reasonable request of the Purchaser or its assignees, the Administrative
Agent, the Custodian or the Collateral Agent, the Seller shall use its commercially reasonable efforts for up to 60 days to obtain the
consent of such third-party licensor. The license granted hereby shall be irrevocable until the Final Maturity Date and shall terminate
on the date this Agreement terminates in accordance with its terms. The Seller shall take such action reasonably requested by the Purchaser
or the Administrative Agent, from time to time hereafter, that may be necessary or appropriate to ensure that the Purchaser and its assigns
under the Credit Agreement have an enforceable ownership or security interest, as applicable, in each Transferred Asset Conveyed by the
Seller as contemplated by this Agreement.

 

(iv) In connection with the acquisition by the Purchaser of each Transferred Asset as contemplated by this Agreement, the Seller further
agrees that it shall, at its own expense, indicate clearly and unambiguously in its computer files on or prior to each Purchase Date,
and its books and records, that such Transferred Asset has been acquired by the Purchaser in accordance with this Agreement.

 

(v)
The Seller shall, at all times, continue to fulfill its obligations under, and in strict conformance with the terms of all Underlying
Loan Agreements (other than with respect to funding obligations to Obligors in connection with Delayed Drawdown Collateral Loans) related
to any Transferred Assets transferred hereunder.

 

(vi) The Seller acknowledges with respect to itself that the representations and warranties of the Seller in Article IV hereof
and the covenants of the Seller in Article V hereof, will run to and be for the benefit of the Purchaser and the Collateral Agent
(on behalf of the Secured Parties) and the Collateral Agent (on behalf of the Secured Parties) may enforce directly (without joinder of
the Purchaser when enforcing against the Seller), the obligations of the Seller or the Purchaser, as applicable, with respect to breaches
of such representations, warranties and covenants as set forth in this Agreement.

 

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SECTION 2.2 
[Reserved].

 

SECTION 2.3 
Indemnification.

 

(a)
Without limiting any other rights which any such Person may have hereunder or under applicable law, the Seller agrees to indemnify,
on an after-tax basis, the Purchaser and its successors, transferees, and assigns (including each Secured Party) and all officers, directors,
shareholders, controlling persons, employees and agents of any of the foregoing (each of the foregoing Persons being individually called
an “Indemnified Party”), 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 being collectively called
“Indemnified Amounts”) awarded against or incurred by any of them arising out of (i) any acts or omissions of the Seller
and relating to this Agreement and the transactions contemplated hereby or (ii) any breach by the Seller of any of its obligations hereunder
or arising as a result of the failure of any representation or warranty made by the Seller hereunder, excluding, however,
(a) Indemnified Amounts in respect of any Transferred Asset due to such Obligor’s creditworthiness or (b) Indemnified Amounts
payable to an Indemnified Party to the extent determined by a court of competent jurisdiction to have resulted from gross negligence,
bad faith or willful misconduct on the part of any Indemnified Party or its agent or subcontractor.

 

(b)
Any amounts subject to the indemnification provisions of this Section 2.3 shall be paid by the Seller to the relevant Indemnified
Party within five Business Days following such Person’s demand therefor.

 

(c)
If for any reason the indemnification provided above in this Section 2.3 is unavailable to an Indemnified Party or is insufficient
to hold such Indemnified Party harmless, then the Seller 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 Seller, as the case may be, on the other hand but also the relative fault of such Indemnified
Party as well as any other relevant equitable considerations.

 

(d)
Indemnification under this Section 2.3 shall be in an amount necessary to make the relevant Indemnified Party whole after
taking into account any tax consequences to such Indemnified Party of the receipt of the indemnity provided hereunder, including the effect
of such tax or refund on the amount of tax measured by net income or profits that is or was payable by such Indemnified Party.

 

(e)
The obligations of the Seller under this Section 2.3 shall survive the termination of this Agreement.

 

(f) The Seller acknowledges that, pursuant to the Credit Agreement, the Purchaser shall assign its rights of indemnity hereunder to
the Collateral Agent, on behalf of the Secured Parties. Upon such assignment, (a) the Collateral Agent, on behalf of the Secured Parties,
shall have all rights of the Purchaser hereunder and may in turn assign such rights, and (b) the obligations of the Seller under this
Section 2.3(f) shall inure to the Collateral Agent, on behalf of the Secured Parties. The Seller agrees that, upon such assignment,
the Collateral Agent, on behalf of the Secured Parties, may enforce directly, without joinder of the Purchaser, the indemnities set forth
in this Section 2.3.

 

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SECTION 2.4 
Administrative Convenience. The Seller and the Purchaser acknowledge and agree that, solely for administrative convenience,
the Seller may direct that a Collateral Loan be titled directly into the name of the Purchaser, and/or that any document or assignment
agreement (or, in the case of any original promissory note, any chain of indorsement) required to be executed and delivered in connection
with (a) the acquisition of a Collateral Loan as a lender at the closing thereof may be executed and delivered directly by the Purchaser
at the direction of the Seller or (b) the transfer of a Collateral Loan in accordance with the terms of the Related Documents may reflect
that the Seller (or any affiliate thereof or any third party from whom the Seller may purchase a Collateral Loan) is assigning such Collateral
Loan directly to the Purchaser. Nothing in any such document or assignment agreement (or, in the case of any original promissory note,
nothing in such chain of indorsement) shall be deemed to impair the transfers of the related Collateral Loan by the Seller to the Purchaser
in accordance with the terms of this Agreement. The Seller and the Purchaser acknowledge and agree that, solely for administrative convenience,
any transfer document required to be executed and delivered in connection with the transfer of a Transferred Asset in accordance with
the terms of the Related Documents may reflect that (i) the Seller (or any Affiliate or third party from whom the Seller or the applicable
Affiliate may purchase such Transferred Asset) is assigning such Transferred Asset directly to the Purchaser or (ii) the Purchaser is
acquiring such Transferred Asset at the closing of such Transferred Asset.

 

ARTICLE
III

CONSIDERATION AND PAYMENT; REPORTING

 

SECTION 3.1 
Purchase Price. The purchase price and/or the amount of contribution, as applicable, for the Transferred Assets Conveyed
on each Purchase Date (the “Purchase Price”) shall be in an amount in the applicable Eligible Currency equal to the
fair market value (as agreed upon between the Seller and the Purchaser at the time of such Conveyance) of such Transferred Assets as of
such date. Each of the Purchaser and the Seller hereby agree that the fair market value of each Collateral Loan Conveyed hereunder as
of the related Purchase Date shall not be less than the Assigned Value thereof as of the applicable Acquisition Date multiplied by the
principal balance of such Collateral Loan.

 

SECTION 3.2 
Payment of Purchase Price. (a) The Purchase Price shall be paid on the related Purchase Date (a) first, by payment in cash
in immediately available funds in an amount not greater than the sum of (i) the proceeds of Advances made to the Purchaser with respect
to such Collateral Loans to be Conveyed on such Purchase Date and (ii) during the period from the Closing Date until the Commitment Termination
Date, amounts on deposit in the Collection Account pursuant to Section 9.01(a) of the Credit Agreement and (b) second, to the extent not
paid in cash, by the Seller making a capital contribution to the Purchaser in an amount equal to the unpaid portion of the Purchase Price.

 

(b) Upon
the payment of the Purchase Price for any Conveyance, title to the Transferred Assets included in such Conveyance shall vest in the Purchaser,
whether or not the conditions precedent to such Conveyance and the other covenants and agreements contained herein were in fact satisfied;
provided that the Purchaser shall not be deemed to have waived any claim it may have under this Agreement for the failure by the
Seller in fact to satisfy any such condition precedent, covenant or agreement.

 

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ARTICLE
IV

REPRESENTATIONS AND WARRANTIES

 

SECTION 4.1 
Seller’s Representations and Warranties. The Seller represents and warrants to the Purchaser as of the Closing Date
and as of each Purchase Date:

 

(a) Due Organization;
Power and Authority. The Seller is a corporation, duly incorporated, validly existing and in good standing under the laws of
Maryland, with full power and authority to own and operate its assets and properties, conduct the business in which it is now
engaged and to execute and deliver and perform its obligations under this Agreement and the other Facility Documents to which it is
a party.

 

(b) Due Qualification
and Good Standing. The Seller is validly existing and in good standing under the laws of its jurisdiction of incorporation. The
Seller is duly qualified to do business and, to the extent applicable, is in good standing in each other jurisdiction in which the
nature of its business, assets and properties, including the performance of its obligations under this Agreement, the other Facility
Documents to which it is a party and its Constituent Documents, requires such qualification, except where the failure to be so
qualified or in good standing would not reasonably be expected to have a Material Adverse Effect.

 

(c) Due Authorization;
Execution and Delivery; Legal, Valid and Binding; Enforceability. The execution and delivery by the Seller of, and the
performance of its obligations under the Facility Documents to which it is a party and the other instruments, certificates and
agreements contemplated thereby are within its powers and have been duly authorized by all requisite action by it and have been duly
executed and delivered by it and constitute its legal, valid and binding obligations enforceable against it in accordance with their
respective terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting creditors’ rights generally or general principles of equity, regardless of whether considered in a
proceeding in equity or at law.

 

(d) Non-Contravention.
None of the execution and delivery by the Seller of this Agreement or the other Facility Documents to which it is a party, the
consummation of the transactions herein or therein contemplated, or compliance by it with the terms, conditions and provisions
hereof or thereof, will (i) conflict with, or result in a breach or violation of, or constitute a default under its Constituent
Documents, (ii) conflict with or contravene (A) any Applicable Law in any material respect, (B) any material indenture, agreement or
other contractual restriction binding on or affecting it or any of its assets, including any Related Document, or (C) any material
order, writ, judgment, award, injunction or decree binding on or affecting it or any of its assets or properties or (iii) result in
a breach or violation of, or constitute a default under, or permit the acceleration of any obligation or liability in any material
contractual obligation or any material agreement or document to which it is a party or by which it or any of its assets are bound
(or to which any such obligation, agreement or document relates).

 

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(e) Governmental
Authorizations; Private Authorizations; Governmental Filings. The Seller has obtained, maintained and kept in full force and
effect all Governmental Authorizations and Private Authorizations which are necessary for it to properly carry out its business, and
made all Governmental Filings necessary for the execution and delivery by it of the Facility Documents to which it is a party, and
the performance by the Seller of its obligations under this Agreement and the other Facility Documents to which it is a party, other
than such UCC financing statements to be filed in connection with the execution and delivery of the Facility Documents, and no
material Governmental Authorization, Private Authorization or Governmental Filing which has not been obtained or made is required to
be obtained or made by it in connection with the execution and delivery by it of any Facility Document to which it is a party, the
pledge of the Transferred Assets by the Seller under this Agreement or the performance of its obligations under this Agreement and
the other Facility Documents to which it is a party.

 

(f)  
Compliance with Agreements, Laws, Etc. The Seller has duly observed and complied with all Applicable Laws relating to the
conduct of its business and its assets, except as would not reasonably be expected to have a Material Adverse Effect. The Seller has preserved
and kept in full force and effect its legal existence. The Seller has preserved and kept in full force and effect its rights, privileges,
qualifications and franchises necessary for the conduct of its business.

 

(g) Sanctions;
Anti-Corruption Laws; and Anti-Money Laundering Laws. Neither the Seller nor any of its Affiliates is a Sanctioned Person or is
under investigation for an alleged breach of Sanctions by a Governmental Authority that enforces Sanctions. The Seller is in
compliance with Anti-Corruption Laws and Anti-Money Laundering Laws.

 

(h) Place of
Business. The principal place of business and chief executive office of the Seller, and the offices where the Seller keeps all
its Records, are located at its address specified on Schedule B, or such other locations notified to the Purchaser in accordance
with this Agreement. There are currently no, and during the past four months (or such shorter time as the Seller has been in
existence) there have not been, any other locations where the Seller is located (as that term is used in the UCC of the jurisdiction
where such principal place of business is located).

 

(i) Backup Security Interest. Notwithstanding that it is the express intent of the parties hereto that each Conveyance of Transferred
Assets hereunder be an absolute sale and/or contribution of such Transferred Assets by the Seller to the Purchaser, in the event that
the Conveyances hereunder shall be characterized as loans and not as sales and/or contributions, this Agreement creates a valid and continuing
Lien on the Transferred Assets in favor of the Purchaser and the Collateral Agent, pursuant to the all-assets lien granted by the Purchaser
to the Collateral Agent under the Credit Agreement, as secured party, for the benefit of the Secured Parties, which security interest
is validly perfected under Article 9 of the UCC (to the extent such security interest may be perfected under such article), and is enforceable
as such against creditors of and purchasers from the Seller; the Transferred Assets are comprised of Instruments, Security Entitlements,
General Intangibles, Certificated Securities, Uncertificated Securities, Securities Accounts, Investment Property and Proceeds and such
other categories of collateral under the applicable UCC as to which the Seller has complied with its obligations as set forth herein;
with respect to Transferred Assets that constitute Security Entitlements, all of such Security Entitlements have been credited to the
Custodian Account; the Seller owns and has good and marketable title to the Transferred Assets acquired by the Purchaser on the applicable
Purchase Date, free and clear of any Lien (other than Permitted Liens); the Seller has received all consents and approvals required by
the terms of any Collateral Loan to the sale and granting of a security interest in the Collateral Loans hereunder to the Purchaser and
the Collateral Agent, as assignee on behalf of the Secured Parties; the Seller has taken all necessary steps to file or authorize 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 that portion of the Transferred Assets in which a security interest may be perfected, including by
filing a financing statement pursuant to Article 9 of the UCC as in effect in Maryland; all original executed copies of each underlying
promissory note constituting or evidencing any Transferred Asset have been or, subject to the delivery requirements contained in the Credit
Agreement, will be delivered to the Custodian; with respect to a Transferred Asset that constitutes a Certificated Security, such certificated
security has been delivered to the Custodian, together with an undated stock power executed in blank.

 

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(j) Fair Consideration; No Avoidance for Collateral Loan Payments. With respect to each Transferred Collateral Loan Conveyed
hereunder, the Seller Conveyed such Transferred Collateral Loan to the Purchaser in exchange for payment, made in accordance with the
provisions of this Agreement, in an amount which constitutes fair consideration and reasonably equivalent value or, to the extent that
the fair market value of any Transferred Collateral Loan exceeds the amount of any such payment so received by the Seller from the Purchaser,
the Seller has made a capital contribution to the Purchaser of such portion of such Transferred Collateral Loan. Each such Conveyance
referred to in the preceding sentence shall not have been made for or on account of an antecedent debt owed by the Seller to the Purchaser
and, accordingly, no such sale is or may be voidable or subject to avoidance under Title 11 of the Bankruptcy Code and the rules and regulations
thereunder. In addition, no such Conveyance shall have been made with the intent to hinder or delay payment to or defraud any creditor
of the Seller.

 

(k)
Eligibility of Transferred Collateral Loans. Each Transferred Collateral Loan that is Conveyed hereunder is, at the time
of such Conveyance, an Eligible Collateral Loan and no event has occurred and is continuing which could reasonably be expected to affect
the collectibility of the Transferred Collateral Loan or cause it not to be paid in full. As of each Purchase Date, the Schedule of Collateral
Loans delivered on such Purchase Date provides an accurate and complete listing of all the Transferred Collateral Loans as of such Purchase
Date and the information contained therein with respect to the identity of the Obligor of such Transferred Collateral Loans and the amounts
owing with respect thereto is true and correct in all respects.

 

(l) Adequate
Capitalization; No Insolvency. The Seller is not the subject of any Insolvency Event. The Seller is Solvent and will not become insolvent
after giving effect to the transactions contemplated by this Agreement and the other Facility Documents. The Seller is adequately capitalized
for its business as proposed to be conducted in the foreseeable future and does not expect the commencement of any insolvency, bankruptcy
or similar proceedings or the appointment of a receiver, liquidator or similar official in respect of its assets.

 

(m) True Sale. Each Transferred Collateral Loan Conveyed hereunder shall have been Conveyed by the Seller to the Purchaser in
a “true sale” or “true contribution”.

 

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(n) Information True
and Correct. All information heretofore or hereafter furnished by or on behalf of the Seller in writing to any Lender, the
Collateral Agent or the Administrative Agent in connection with this Agreement or any transaction contemplated hereby is and shall
be true, complete and correct in all material respects as of the date such information is stated or certified (or, with respect to
information of a general economic or general industry nature or information received from an Obligor or other third party not under
the direction of the Seller or an Affiliate thereof, is true and correct in all material respects to the knowledge of the Seller),
in each case after giving effect to all written updates provided by the Seller.

 

(o) Bulk Sales. The
execution, delivery and performance of this Agreement and the transactions contemplated hereby do not require compliance with any
“bulk sales” act or similar law by the Seller.

 

(p) Taxes. The
Seller has filed or caused to be filed all federal and state income tax and all other material tax returns which are required to be
filed by it, if any, and has paid all taxes shown to be due and payable on such returns or on any assessments made against it or any
of its property and all other taxes, fees or other charges imposed on it or any of its property by any Governmental Authority (other
than any amount of tax due, the validity of which is currently being contested in good faith by appropriate proceedings and with
respect to which reserves in accordance with generally accepted accounting principles have been provided on its books in accordance
with GAAP); no tax lien has been filed against any of the Transferred Assets.

 

(q) Special Purpose
Entity. The Purchaser is an entity with assets and liabilities separate and distinct from those of the Seller and any Affiliates
thereof, and the Seller hereby acknowledges that the Administrative Agent, the Lenders and the other Secured Parties are entering
into the transactions contemplated by the Credit Agreement in reliance upon the Purchaser’s identity as a legal entity that is
separate from the Seller and from each other Affiliate of the Seller. Therefore, from and after the date of execution and delivery
of this Agreement, the Seller shall take all reasonable steps, including all steps that the Purchaser or the Administrative Agent
may from time to time reasonably request, to maintain the Purchaser’s identity as a legal entity that is separate from the
Seller and from each other Affiliate of the Seller, and to make it manifest to third parties that the Purchaser is an entity with
assets and liabilities distinct from those of the Seller and each other Affiliate thereof and not just a division of the Seller or
any such other Affiliate.

 

(r) 
No Proceedings. There are no proceedings or investigations pending or, to the best knowledge of any Responsible Officer
of the Seller, threatened against it, before any Official Body having jurisdiction over it or its properties (i) asserting the invalidity
of any of the Facility Documents, (ii) seeking to prevent the making of the Advances or the consummation of any of the transactions contemplated
by the Facility Documents or (iii) seeking any determination or ruling that would reasonably be expected to have a Material Adverse Effect.

 

(s) Selection Procedures. In selecting the Transferred Assets and for Affiliates of the Purchaser, no selection procedures were
employed which are intended to be adverse to the interests of any Agent or any Lender.

 

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(t) 
Not an Investment Company. The Seller is not an “investment company”, required to be registered as an “investment
company” or a company controlled by an “investment company,” as such term is defined in the Investment Company Act.

 

(u) Status of BDC.
The Seller is (and shall have at all times maintained its status as) a “business development company” under the
Investment Company Act.

 

(v) Payment in
Full. The Seller has no knowledge of any fact which leads it to expect that any payments on any Transferred Asset at the time of
Conveyance will not be paid in full when due or to expect any other adverse effect on (A) the performance by the Seller of its
obligations under this Agreement or any of the Facility Documents, (B) the validity or enforceability of this Agreement or any of
the Facility Documents, or (C) the Transferred Assets or the interests of the Seller therein.

 

(w) 
Representations and Warranties True and Correct. Each of the representations and warranties of the Seller contained in the
Facility Documents (other than this Agreement) is true and correct in all material respects.

 

(x) No Collateral
Manager Default; Default; Event of Default. No Collateral Manager Default, Default or Event of Default has occurred and is
continuing that resulted from any action or inaction of the Seller.

 

(y) No Brokers or
Finders. No broker or finder acting on behalf of the Seller was employed or utilized in connection with this Agreement or the
other Facility Documents or the transactions contemplated hereby or thereby and the Seller has no obligation to any Person in
respect of any finder’s or brokerage fees in connection therewith.

 

(z) Restricted
Payments. The Seller shall not cause or permit the Purchaser to make any payments or distributions except in accordance with the
Credit Agreement.

 

(aa) Transferred
Assets. As of each Purchase Date, Schedule A is an accurate and complete listing of all the Transferred Assets hereunder as of
such Purchase Date and the information contained therein with respect to the identity of such Transferred Assets and the amounts
owing thereunder is true and correct as of the related Purchase Date.

 

(bb) Set-Off, etc.
As of the applicable Purchase Date, no Transferred Assets included in the Borrowing Base have been compromised, satisfied, rescinded
or set-off by the Seller or by the Obligor thereof, and no Transferred Assets included in the Borrowing Base are 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 Transferred Assets
or otherwise, by the Seller or by the Obligor with respect thereto except, in each case, for amendments, extensions and
modifications, if any, to such Transferred Assets otherwise permitted or not prohibited under the Facility Documents and in
accordance with the Collateral Manager Standard.

 

(cc) No Fraud. Each
Collateral Loan that was originated by the Seller was originated without any fraud or misrepresentation on the part of any party
thereto.

 

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(dd) Price of
Collateral Loans. The Purchase Price for each Collateral Loan Conveyed by the Seller to the Purchaser hereunder represents the
fair market value of such Collateral Loan as of the time of Conveyance hereunder, as may have changed from the time such Collateral
Loan was originally acquired or originated by the Seller.

 

(ee) Exchange Act
Compliance; Regulations T, U and X. None of the transactions contemplated herein or the other Facility Documents (including,
without limitation, the use of the Proceeds from the pledge of the Collateral) will violate or result in a violation of Section 7 of
the Exchange Act, or any regulations issued pursuant thereto, including, without limitation, Regulations T, U and X of the Board of
Governors of the Federal Reserve System, 12 C.F.R., Chapter II.

 

(ff) No
Injunctions. No injunction, writ, restraining order or other order of any nature adversely affects the Seller’s
performance of its obligations under this Agreement or any other Facility Document to which the Seller is a party.

 

(gg) Allocation of
Charges. There is not any agreement or understanding between the Seller and the Purchaser (other than as expressly set forth in
the Credit Agreement or as consented to by the Administrative Agent), providing for the allocation or sharing of obligations to make
payments or otherwise in respect of any Taxes, fees, assessments or other governmental charges.

 

(hh) ERISA
Compliance. Neither (i) the Seller nor (ii) any member of its ERISA Group has, or during the past six years had, any
liability or obligation with respect to any Plan or Multiemployer Plan. The assets of the Seller are not treated as “plan
assets” within the meaning of the Plan Assets Regulations and Collateral is not deemed to be “plan assets” within
the meaning of the Plan Assets Regulation. The execution, delivery and performance of this Agreement do not and will not constitute
a Prohibited Transaction.

 

(ii) Collections.
The Person acting as agent or administrative agent for the lenders under each of the Transferred Assets have been instructed to
forward payments in respect of the Transferred Assets Conveyed by the Seller only to the Collection Account. The Seller acknowledges
that all Interest Proceeds and Principal Proceeds received by it or its Affiliates with respect to each Transferred Asset Conveyed
by the Purchaser as contemplated by this Agreement are held and shall be held in trust for the benefit of the Purchaser (or its
assignees) until deposited into the Collection Account as required by the Credit Agreement.

 

(jj) Ownership of the
Purchaser. The Seller owns, directly or indirectly, 100% of the membership interests of the Purchaser, free and clear of any
Lien. Such membership interests are validly issued and there are no options or other rights to acquire membership interests of the
Purchaser.

 

(kk) Opinion. The
statements of fact in the section heading “Facts and Assumptions” in the non-consolidation and true sale opinion (the
“Non-Consolidation/True Sale Opinion”) of Moore & Van Allen LLC, dated as of the date hereof are true,
complete and correct, but solely to the extent that such opinion letter expressly requires such facts to remain true and correct at
all times in order for such letter’s underlying opinions to be valid.

 

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SECTION 4.2 
Reaffirmation of Representations and Warranties by the Seller; Notice of Breach. On the Closing Date and on each Purchase
Date, the Seller, by accepting the proceeds of such Conveyance, shall be deemed to have certified that all representations and warranties
described in Section 4.1 are true and correct in all respects on and as of such day as though made on and as of such day (or
if specifically referring to an earlier date, as of such earlier date). The representations and warranties set forth in Section 4.1
shall survive (i) the Conveyance of the Transferred Assets to the Purchaser, (ii) the termination of the rights and obligations
of the Purchaser and the Seller under this Agreement and (iii) the termination of the rights and obligations of the Purchaser under
the Credit Agreement. Upon discovery by a Responsible Officer of the Purchaser or the Seller of a breach of any of the foregoing representations
and warranties in any respect, the party discovering such breach shall give prompt written notice to the other and to the Administrative
Agent.

 

ARTICLE
V

COVENANTS

 

SECTION 5.1 
Protection of Title of the Purchaser. (a) On or prior to the Closing Date, the Seller shall have
filed or caused to be filed UCC-1 and/or UCC-3 financing statements, naming the Seller as “Debtor/Seller”, naming the
Purchaser as “Secured Party/Buyer”, and naming the Collateral Agent, for the benefit of the Secured Parties, as “Total
Assignee”, and describing the Transferred Assets to be acquired by the Purchaser, with the office of the Secretary of State of
Maryland. From time to time thereafter, the Seller shall file such financing statements and cause to be filed such continuation statements,
all in such manner and in such places as may be required by law (or deemed desirable by the Purchaser or any assignee thereof) to fully
perfect, preserve, maintain and protect the ownership interest of the Purchaser under this Agreement and the security interest of the
Collateral Agent for the benefit of the Secured Parties under the Credit Agreement, in each Transferred Asset acquired by the Purchaser
hereunder, as the case may be, and in the proceeds thereof. The Seller shall deliver (or cause to be delivered) to the Purchaser, the
Collateral Agent, the Custodian and the Administrative Agent (who will provide each Lender with a copy promptly upon receipt thereof)
file-stamped copies of, or filing receipts for, any document filed as provided above, as soon as available following such filing. The
Seller agrees that it will from time to time, at its expense, take all actions, that the Purchaser, the Collateral Agent or the Administrative
Agent may reasonably request in order to perfect, protect or more fully evidence the Conveyances hereunder and the security and/or interest
granted in each Transferred Asset, or to enable the Purchaser, the Collateral Agent, the Administrative Agent or the Secured Parties
to exercise and enforce their rights and remedies hereunder or under any Facility Document.

 

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(a)
On or prior to each Purchase Date hereunder, the Seller shall take all steps necessary under all Applicable Law in order to Convey
to the Purchaser the Transferred Assets being acquired by the Purchaser on such Purchase Date to the Purchaser so that, upon the Conveyances
of such Transferred Assets from the Seller to the Purchaser pursuant to the terms hereof on such Purchase Date, the Purchaser will have
acquired good and marketable title to and a valid and perfected ownership interest in such Transferred Assets, free and clear of any Lien,
security interest, charge or encumbrance or restrictions on transferability (subject only to Permitted Liens). On or prior to the Closing
Date and each subsequent Purchase Date hereunder, the Seller shall take all steps required under Applicable Law in order for the Purchaser
to grant to the Collateral Agent, for the benefit of the Secured Parties, a first priority perfected security interest (subject only to
Permitted Liens) in the Transferred Assets being acquired by the Purchaser on such Purchase Date and, from time to time thereafter, the
Seller shall take all such actions as may be required by Applicable Law to fully preserve, maintain and protect the Purchaser’s
ownership interest in, and the Collateral Agent’s first priority perfected security interest in (subject only to Permitted Liens),
the Transferred Assets which have been acquired by the Purchaser hereunder.

 

(b)
The Seller shall direct any agent or administrative agent for any Collateral Loan in a Transferred Assets originated or acquired
by the Seller to remit all payments and collections with respect to such Transferred Assets directly to the Collection Account. The Seller
will not make any change in its instructions to Obligors regarding payments to be made to the Seller or payments to be made to the Collection
Account, unless the Purchaser and the Administrative Agent have consented to such change. The Seller shall direct or cause only funds
constituting payments and collections relating to each Transferred Asset to be deposited into the Collection Account. In the event any
payments relating to any Transferred Assets are remitted directly to the Seller or any Affiliate of the Seller, the Seller will remit
(or will cause all such payments to be remitted) directly to the Collection Account within two Business Days following receipt thereof,
and, at all times prior to such remittance, the Seller will itself hold or, if applicable, will cause such payments to be held in trust
for the exclusive benefit of the Purchaser and its assignees. Until so deposited, all such Interest Proceeds and Principal Proceeds shall
be held in trust for the Purchaser or its assignees by the Seller.

 

(c)
At any time after the occurrence and declaration of the Final Maturity Date (other than in connection with a voluntary commitment
reduction pursuant to Section 2.06(b) of the Credit Agreement), the Purchaser, the Collateral Agent or the Administrative Agent may direct
the Seller to notify the Obligors, at Seller’s expense, of the Purchaser’s (or its assigns) or the Secured Parties’
interest in each Transferred Asset under this Agreement and may direct that payments of all amounts due or that become due under any or
all of the Transferred Assets be made directly to the Purchaser (or its assigns), the Collateral Agent or the Administrative Agent.

 

(d)
The Seller shall, not earlier than six months prior to the fifth anniversary of the date of filing of the financing statement referred
to in Section 7.1 or any other financing statement filed pursuant to this Agreement or in connection with any Conveyance hereunder,
unless the Final Maturity Date shall have occurred, file or cause to be filed an appropriate continuation statement with respect to such
financing statement and the Purchaser hereby authorizes the Seller to file such continuation statements.

 

(e)  
The Seller shall not (x) change its name, move the location of its principal place of business and chief executive office, change
the offices where it keeps records concerning the Transferred Assets from the address set forth on Schedule B hereto, or change the jurisdiction
of its formation, or (y) subject to Section 8.07 of the Credit Agreement move, or consent to the Custodian moving, the Collateral Loan
Documents and Collateral Loan Files from the location required under the Facility Documents, unless the Seller has given written notice
to the Purchaser and the Administrative Agent (who will provide each Lender with a copy promptly upon receipt thereof) and has taken all
actions required under the UCC of each relevant jurisdiction in order to continue the first priority perfected security interest of the
Purchaser in each Transferred Assets, within 30 days following such change.

 

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(f)
The Seller shall mark its books and records so that, from and after the time of Conveyance under this Agreement of each Transferred
Asset to the Purchaser and the grant of a security interest in such Transferred Assets by the Purchaser to the Collateral Agent for the
benefit of the Secured Parties under the Credit Agreement, the Seller’s books and records that refer to such Transferred Asset shall
indicate clearly that such Transferred Asset has been acquired by the Purchaser hereunder.

 

(g)
If the Seller fails to perform any of its obligations hereunder, the Purchaser, the Collateral Agent or the Administrative Agent
may (but shall not be required to) perform, or cause performance of, such obligation; and the Purchaser’s, the Collateral Agent’s
or the Administrative Agent’s costs and expenses incurred in connection therewith shall be payable by the Seller as provided in
Section 2.3. The Seller hereby irrevocably authorizes the Purchaser, the Collateral Agent or the Administrative Agent at any
time and from time to time at the Purchaser’s, the Collateral Agent’s or the Administrative Agent’s sole discretion
and appoints the Purchaser, the Collateral Agent and the Administrative Agent as its true and lawful attorney-in-fact to act on behalf
of the Seller (i) to file financing statements on behalf of the Seller, as debtor, necessary or desirable in the Purchaser’s, the
Collateral Agent’s or the Administrative Agent’s sole discretion to perfect and to maintain the perfection and priority of
the interest of the Purchaser or the Collateral Agent in the Transferred Assets and (ii) to file a carbon, photographic or other reproduction
of this Agreement or any financing statement with respect to the Transferred Assets as a financing statement in such offices as the Purchaser,
the Collateral Agent or the Administrative Agent in their sole discretion deem necessary or desirable to perfect and to maintain the perfection
and priority of the interests of the Purchaser or the Collateral Agent in the Transferred Assets. This appointment is coupled with an
interest and is irrevocable. The Seller hereby ratifies, to the extent permitted by law, all that said attorneys shall lawfully do or
cause to be done by virtue hereof. No Person to whom this power of attorney is presented, as authority for the Attorney to take any action
or actions contemplated hereby, shall be required to inquire into or seek confirmation from the Seller as to the authority of the Attorney
to take any action described below, or as to the existence of or fulfillment of any condition to this power of attorney, which is intended
to grant to the Attorney unconditionally the authority to take and perform the actions contemplated herein, and the Seller irrevocably
waives any right to commence any suit or action, in law or equity, against any Person or entity that acts in reliance upon or acknowledges
the authority granted under this power of attorney.

 

SECTION 5.2 
Covenants of the Seller. The Seller hereby covenants and agrees with the Purchaser that, from the date hereof, and until
all amounts owed by the Seller pursuant to this Agreement have been paid in full (other than as expressly survive the termination of this
Agreement), unless the Purchaser otherwise consents in writing:

 

(a)
Compliance with Agreements, Laws, Etc. The Seller shall (i) duly observe and comply in all respects with all Applicable
Laws relative to the conduct of its business or to its assets, (ii) preserve and keep in full force and effect its legal existence, (iii)
preserve and keep in full force and effect its rights, privileges, qualifications and franchises, (iv) comply with the terms and conditions
of each Facility Document to which it is a party, its Constituent Documents and (v) obtain, maintain and keep in full force and effect
all Governmental Authorizations, Private Authorizations and Governmental Filings which are necessary or appropriate to properly carry
out (A) its business and (B) the transactions contemplated to be performed by it under the Facility Documents to which it is a party,
its Constituent Documents and the Related Documents to which it is a party except, in the case of clause (i), (iii) and (v)(A), where
the failure to do so would not reasonably be expected to cause a Material Adverse Effect.

 

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(b)
Preservation of Purchaser Existence. The Seller will preserve and maintain its limited liability company existence, rights,
franchises and privileges in the jurisdiction of its formation, and qualify and remain qualified in good standing as a limited liability
company in each jurisdiction where the failure to be so qualified could reasonably be expected to have a Material Adverse Effect.

 

(c)
Performance and Compliance with Transferred Assets. The Seller will, at its expense, timely and fully perform and comply
with all provisions, covenants and other promises required to be observed by it under each Transferred Asset and all other agreements
related to such Transferred Asset.

 

(d)
Cash Management Systems: Deposit of Collections. To the extent the Seller (in its capacity as such) receives any Collections
with respect to the Transferred Assets after the Purchase Date, the Seller shall transfer, or cause to be transferred, all such Collections
to the Collection Account by the close of business on the second Business Day following the date such Collections are received by the
Seller.

 

(e)
Books and Records. The Seller shall keep proper books of record and account in which full and correct entries shall be made
of all financial transactions with the Purchaser and the assets and business of the Seller related to its obligations under this Agreement
or any Transferred Assets or assets proposed to be transferred in accordance with GAAP, maintain and implement administrative and operating
procedures necessary to fulfill its obligations hereunder, and keep and maintain all documents, books, records and other information necessary
or reasonably advisable and relating to the Transferred Assets prior to their Conveyance hereunder for the collection of all Transferred
Assets.

 

(f)  
Accounting of Purchases. The Seller will not account for or treat the transactions contemplated hereby in any manner other
than as a sale or contribution of the Transferred Assets by the Seller to the Purchaser including for tax purposes, where appropriate;
provided that for U.S. federal income tax reporting purposes, the Purchaser is treated as a “disregarded entity” and, therefore,
the transfer of Transferred Assets by the Seller to the Purchaser hereunder will not be recognized for such purposes.

 

(g)
Taxes. The Seller will file on a timely basis all federal and state income tax returns and other material tax returns required
to be filed and will pay all taxes due and payable by it or any assessments made against it or any of its property and all other taxes,
fees or other charges imposed on it or any of its property by any Governmental Authority (other than any amount the validity of which
is contested in good faith by appropriate proceedings and with respect to which reserves in conformity with GAAP are provided on the books
of the Seller).

 

(h)
Liens. The Seller shall not create, incur, assume or permit to exist any Lien on or with respect to any of its rights under
any of the Facility Documents or with respect to the Transferred Assets other than Permitted Liens. For the avoidance of doubt, this Section
5.2(h) shall not apply to any property retained by the Seller and not Conveyed or purported to be Conveyed hereunder.

 

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(i) [Reserved].

 

(j) Sale
Characterization. The Seller shall not make statements or disclosures, or treat the transactions contemplated by this Agreement
(other than for tax (as appropriate) or accounting purposes) in any manner other than as a true sale, contribution or absolute
assignment of the title to and sole record and beneficial ownership interest of the Transferred Collateral Loans; provided that the
Seller may consolidate the Purchaser and/or its properties and other assets for accounting purposes in accordance with GAAP and
shall, in any such consolidated financial statement of the Seller, disclose appropriately in a footnote that such Transferred
Collateral Loans are owned by the Purchaser.

 

(k) Disregarded Entity
Status. The Seller shall cause the Purchaser to be treated as and maintain its status as disregarded entity of a United States
person for U.S. federal income tax purposes and shall ensure that neither the Purchaser nor any other Person on its behalf shall
make an election for the Purchaser to be treated as an entity other than a disregarded entity of a United States person for U.S.
federal income tax purposes.

 

(l) ERISA. The
Seller shall not, and shall not cause or permit any of its Affiliates to, cause or permit to occur an event that results in the
imposition of a Lien on any Transferred Asset under Section 412 of the IRC or Section 303(K) or 4068 of ERISA.

 

(m) Commingling.
The Seller shall not, and shall not permit any of its Affiliates to, deposit or permit the deposit of any funds that do not
constitute Collections or other proceeds of any Collateral Loans into the Collection Account.

 

(n) Separate
Identity. The Seller acknowledges that the Administrative Agent, the Lenders and the other Secured Parties are entering into the
transactions contemplated by this Agreement and the Credit Agreement in reliance upon the Purchaser’s identity as a legal
entity that is separate from the Seller and each other Affiliate of the Seller. Accordingly, from and after the date of execution
and delivery of this Agreement, the Seller will take all reasonable steps to maintain the Purchaser’s identity as a legal
entity that is separate from the Seller and each other Affiliate of the Seller and to make it manifest to third parties that the
Purchaser is an entity with assets and liabilities distinct from those of the Seller and each other Affiliate thereof and not just a
division of the Seller or any such other Affiliate. Without limiting the generality of the foregoing and in addition to the other
covenants set forth herein, the Seller will take all other actions necessary on its part to ensure that the Purchaser is at all
times in compliance with Section 5.05 of the Credit Agreement; provided, that the Seller does not hereby agree to maintain
the solvency of the Purchaser.

 

(o)
Proceedings. The Seller shall furnish to the Administrative Agent, promptly and in any event within three (3) Business Days
after any Responsible Officer of the Seller receives notice or obtains knowledge thereof, notice of any final judgment, decree or order
which would result in an Event of Default under Section 6.01 of the Credit Agreement.

 

    -19-

     

    

 

(p)
Mergers. The Seller shall not directly or indirectly, by operation of law or otherwise, merge with, consolidate with, acquire
all or substantially all of the assets or capital stock of, or otherwise combine with or acquire, any Person, except that the Seller shall
be allowed to consummate any of the foregoing transactions so long as the Seller remains the surviving entity of such transaction and
such transaction does not result in a Change of Control. The Seller shall give prior written notice of any merger to the Administrative
Agent.

 

(q) Compliance with
Sanctions; Anti-Money Laundering. The Seller shall comply with Sanctions, Anti-Corruption Laws and Anti-Money Laundering Laws
and shall maintain or be subject to policies and procedures reasonably designed to ensure compliance therewith.

 

(r)  
Opinion. The Seller shall take all actions necessary to maintain the accuracy of the factual assumptions in all material
respects set forth in the Non-Consolidation/True Sale Opinion, except to the extent that any such change in assumptions would not reasonably
be expected to result in a reputable and nationally recognized counsel no longer to be able to render such Non-Consolidation/True Sale
Opinion.

 

SECTION 5.3 
Negative Covenants of the Seller. From the date hereof until
the Final Maturity Date:

 

(a)
Transferred Assets Not to be Evidenced by Instruments. The Seller will take no action to cause any Collateral Loan in a
Transferred Asset that is not, as of the related Purchase Date, as the case may be, evidenced by an instrument, to be so evidenced except
in connection with the enforcement or collection of such Collateral Loan.

 

(b)
Security Interests. Except as otherwise permitted herein and in the Credit Agreement, the Seller will not sell, pledge,
assign or transfer to any other Person, or grant, create, incur, assume or suffer to exist any Lien on any Transferred Asset Conveyed
by the Seller to the Purchaser hereunder, whether now existing or hereafter transferred hereunder, or any interest, therein, and the Seller
will not sell, pledge, assign or suffer to exist any Lien (except for Permitted Liens) on its interest in the Transferred Asset Conveyed
by the Seller to the Purchaser hereunder. The Seller will promptly notify the Purchaser, the Collateral Agent and the Administrative Agent
(who will provide each Lender with notice promptly upon receipt thereof) of the existence of any Lien on any Transferred Asset and the
Seller shall defend the right, title and interest of the Purchaser and the Collateral Agent, on behalf of the Secured Parties, in, to
and under the Transferred Asset against all claims of third parties; provided that nothing in this Section 5.3(b) shall
prevent or be deemed to prohibit the Seller from suffering to exist Permitted Liens upon any of the Transferred Assets.

 

(c)
[Reserved].

 

(d)
Restricted Payments. The Seller shall not cause or permit the Purchaser to make any Restricted Payment, except that, the
Purchaser may make distributions to the Equityholder in accordance with the Credit Agreement.

 

(e)
Accounting of Transfers. Other than for tax and consolidated accounting purposes, the Seller will not account for or treat (whether
in financial statements or otherwise) the transactions contemplated hereby in any manner other than as a sale or contribution of the Collateral
Loans to the Purchaser

 

    -20-

     

    

 

(f)  
[Reserved].

 

(g)
Extension or Amendment of Transferred Asset. The Seller will not, except as otherwise permitted in Section 5.02(s) of the
Credit Agreement, extend, amend or otherwise modify, or permit the Collateral Manager to extend, amend or otherwise modify, the terms
of any Transferred Asset.

 

(h)
Limitation on Financing Activities. The Seller shall not, directly or indirectly, advance or contribute to the Purchaser
any funds pursuant to any financial accommodation; provided that the foregoing shall not prohibit the Seller from contributing Collateral
Loans to the Purchaser as contemplated herein or providing cash equity contributions to the Purchaser.

 

(i) Organizational
Documents. The Seller will not cause or permit the Purchaser to amend, modify, waive or terminate any provision of the Purchaser’s
limited liability company agreement without the prior written consent of the Administrative Agent.

 

(j) Changes
in Payment Instructions to Obligors. The Seller will not make any change, or permit the Purchaser to make any change, in its instructions
to Obligors regarding payments to be made with respect to the Transferred Assets to the Collection Account.

 

ARTICLE
VI

WARRANTY LOANS

 

SECTION 6.1 
Warranty Collateral Loans.

 

The Seller agrees that, with
respect to any Transferred Collateral Loan that is an Eligible Collateral Loan, in the event of a material breach of any representation
or warranty or covenant applicable to such Transferred Asset set forth in Article IV or Article V, in each case as
of the trade date with respect thereto (each such Transferred Collateral Loan, a “Warranty Collateral Loan”), no later
than 10 Business Days after the earlier of (x) knowledge of such breach on the part of a Responsible Officer of the Seller and (y) receipt
by a Responsible Officer of the Seller of written notice thereof given by the Purchaser, the Administrative Agent or any other Secured
Party, the Seller shall either (a) pay to the Collection Account in immediately available funds the Repurchase Amount with respect to
the Warranty Collateral Loan(s) to which such breach relates or (b) substitute for such Warranty Collateral Loan(s) one or more Eligible
Collateral Loan with an Assigned Value at least equal to the Repurchase Amount of the Warranty Collateral Loan(s) being replaced; provided
that no such repayment or substitution shall be required to be made with respect to any Warranty Collateral Loan (and such Collateral
Loan shall cease to be a Warranty Collateral Loan) if, on or before the expiration of such 10 Business Day period, the representations
and warranties in Article IV and the covenants in Article V with respect to such Warranty Collateral Loan shall be made
true and correct in all respects with respect to such Warranty Collateral Loan as if such Warranty Collateral Loan had been Conveyed to
the Purchaser on such day. It is understood and agreed that the obligation of the Seller to purchase such Warranty Collateral Loan or
substitute such Warranty Collateral Loan is not intended to, and shall not, constitute a guaranty of the collectability or payment of
any Transferred Asset which is not collected, not paid, or uncollectible on account of the insolvency, bankruptcy or financial inability
to pay of the related Obligor.

 

    -21-

     

    

 

SECTION 6.2 
Limitation on Sales to Seller and Affiliates. Except as otherwise expressly permitted under the Credit Agreement (including
purchase permitted by Section 10.01 of the Credit Agreement), the Seller and the Purchaser agree that the Seller and any Affiliate of
the Seller may repurchase any portion of a Transferred Assets only from the Purchaser in the case of a repurchase or substitution of any
Collateral Loan pursuant to Section 6.1.

 

ARTICLE
VII

CONDITIONS PRECEDENT

 

SECTION 7.1 
Conditions Precedent to Effectiveness. The obligations of the Purchaser to pay the Purchase Price for the Transferred Assets
sold on the Closing Date and any Purchase Date shall be subject to the satisfaction of the following conditions:

 

(a)
a copy of this Agreement duly executed by each of the parties hereto;

 

(b)
a certificate of a Responsible Officer of the Seller, dated the Closing Date, certifying (i) as to its Constituent Documents, (ii)
that each of the representations and warranties made by such Person under the Facility Documents are true and correct in all material
respects as of the Closing Date (except to the extent such representations and warranties expressly relate to any earlier date, in which
case such representations and warranties shall be true and correct in all material respects as of such earlier date), (iii) that no Default
or Event of Default has occurred and is continuing, and (iv) as to the incumbency and specimen signature of each of its Responsible Officers
authorized to execute the Facility Documents to which it is a party;

 

(c)
a good standing certificate, dated as of a recent date for the Seller, issued by the Secretary of State of Maryland;

 

(d)
filed, original copies of proper financing statements describing the Transferred Assets, and naming the Seller as the “Debtor/Seller”
and the Purchaser as “Secured Party/Buyer”, or other similar instruments or documents, in form and substance sufficient for
filing under the UCC or any comparable law of any and all jurisdictions as may be necessary to perfect the Purchaser’s ownership
interest in all Transferred Assets;

 

(e)
copies of properly authorized termination statements or statements of release (on Form UCC-3) or other similar instruments or documents,
if any, in form and substance sufficient for filing under the UCC or any comparable law of any and all jurisdictions as may be necessary
to release all security interests and similar rights of any Person in the Transferred Assets previously granted by the Seller.

 

    -22-

     

    

 

(f)  
copies of tax and judgment lien searches in all jurisdictions reasonably requested by the Purchaser or its assignees and requests
for information (or a similar UCC search report certified by a party acceptable to the Purchaser and its assigns), dated a date reasonably
near to the Closing Date, and with respect to such requests for information or UCC searches, listing all effective financing statements
which name the Seller (under its present name and any previous name) as debtor, together with copies of such financing statements (none
of which shall cover any Transferred Assets); and

 

(g)
one or more customary legal opinions of counsel to the Seller.

 

SECTION 7.2 
Conditions Precedent to all Conveyances. The obligations of the Purchaser to pay the Purchase Price for the Transferred
Assets sold on any Purchase Date shall be subject to the satisfaction of the following conditions:

 

(a)
All representations and warranties of the Seller contained in this Agreement shall be true and correct in all material respects
on such Purchase Date;

 

(b)
All information concerning the Transferred Assets provided to the Purchaser and the Administrative Agent shall be true and correct
in all material respects as of such Purchase Date;

 

(c)
The Seller shall have performed in all material respects all other obligations required to be performed by the provisions of this
Agreement, the other Facility Documents to which it is a party and the Related Documents with respect to the Transferred Assets;

 

(d)
No Default or Event of Default shall have occurred and be continuing or would result from such Conveyance;

 

(e)
The Final Maturity Date has not yet occurred;

 

(f)  
No Applicable Law shall prohibit or enjoin, and no order, judgment or decree of any federal, state or local court or governmental
body, agency or instrumentality shall prohibit or enjoin, the making of any such Conveyance by the Purchaser in accordance with the provisions
hereof.

 

(g)
The Purchaser shall have received a duly executed and completed Purchase Notice that is true, accurate and complete in all material
respects as of the related Purchase Date;

 

(h)
The Seller shall have delivered to the Custodian on behalf of the Purchaser and any assignee thereof each item required to be contained
in the Collateral Loan Documents and the Collateral Loan File Checklist of any of the Eligible Collateral Loans related thereto being
acquired by the Purchaser within five Business Days of the related Purchase Date; and

 

(i) The
Seller shall have taken all steps necessary under all Applicable Law in order to Conveyance to the Purchaser the Transferred Assets being
Conveyed on such Purchase Date and, upon the Conveyance of such Transferred Asset from the Seller to the Purchaser pursuant to the terms
hereof, the Purchaser will have acquired good and marketable title to and a valid and perfected ownership interest in such Transferred
Asset, free and clear of any Lien, security interest, charge or encumbrance (other than Permitted Liens); provided that if such
Collateral Loan in the Transferred Asset contains a restriction of transferability, the applicable Underlying Loan Agreement provides
that any consents necessary for future assignments shall not be unreasonably withheld by the applicable Obligor and/or agent.

 

    -23-

     

    

 

ARTICLE
VIII

[reserved]

 

ARTICLE
IX

ADDITIONAL RIGHTS AND OBLIGATIONS IN

RESPECT OF THE TRANSFERRED ASSETS

 

SECTION 9.1 
Rights of the Purchaser.

 

(a)
After the occurrence or declaration of the Final Maturity Date, the Seller hereby authorizes the Purchaser, the Collateral Manager,
the Collateral Agent, the Administrative Agent, and/or their respective designees or assignees to take any and all steps in Seller’s
name and on behalf of the Seller that the Purchaser, the Collateral Manager, the Collateral Agent, the Administrative Agent and/or their
respective designees or assignees determine are reasonably necessary or appropriate to collect all amounts due under any and all Transferred
Assets and to enforce or protect the Purchaser’s, the Collateral Agent’s, the Administrative Agent’s and the Lenders’
rights under this Agreement, including endorsing the name of the Seller on checks and other instruments representing Interest Proceeds
and Principal Proceeds and enforcing such Transferred Assets.

 

(b)
Except as set forth in Section 6.1 with respect to the repurchase or substitution of certain Collateral Loans, the Purchaser
shall have no obligation to account for, replace, substitute or return any Transferred Assets to the Seller. The Purchaser shall have
no obligation to account for or to return Interest Proceeds or Principal Proceeds, or any interest or other finance charge collected pursuant
thereto, to the Seller, irrespective of whether such Interest Proceeds and Principal Proceeds and charges are in excess of the Purchase
Price for such Transferred Asset.

 

(c)
The Purchaser shall have the right to further assign, transfer, deliver, hypothecate, subdivide or otherwise deal with each Transferred
Asset and all of the Purchaser’s right, title and interest in, to and under this Agreement, pursuant to this Agreement or the Credit
Agreement.

 

(d)
The Purchaser shall have the sole right to retain any gains or profits created by buying, selling or holding each Transferred Asset
and shall have the sole risk of and responsibility for losses or damages created by such buying, selling or holding.

 

SECTION 9.2 
Notice to Collateral Agent and Administrative Agent.(a) The Seller agrees that, concurrently with its delivery to the Purchaser,
copies of all notices, reports, documents and other information required to be delivered by the Seller to the Purchaser hereunder shall
be delivered by the Seller to the Collateral Agent and the Administrative Agent (who will provide each Lender with a copy promptly upon
receipt thereof).

 

    -24-

     

    

 

ARTICLE
X

MISCELLANEOUS PROVISIONS

 

SECTION 10.1
Amendments, Etc. This Agreement and the rights and obligations of the parties hereunder may not be amended, supplemented,
waived or otherwise modified except in an instrument in writing signed by the Purchaser and the Seller and consented to in writing by
the Administrative Agent. Any reconveyance executed in accordance with the provisions hereof shall not be considered an amendment or modification
to this Agreement.

 

SECTION 10.2
Limitation on Liability. Except with respect to any claim arising solely out of the willful misconduct or gross negligence
of a Lender, the Collateral Agent, the Administrative Agent or any other Secured Party, no claim may be made by the Seller or any other
Person against any Lender, the Collateral Agent, the Administrative Agent or any other Secured Party or their respective Affiliates, directors,
officers, employees, attorneys or agents for any special, indirect, consequential or punitive damages in respect of any claim for breach
of contract or any other theory of liability arising out of or related to the transactions contemplated by this Agreement, or any act,
omission or event occurring in connection therewith; and the Seller hereby waives, releases and agrees not to sue upon any claim for any
such damages, whether or not accrued and whether or not known or suspected to exist in its favor.

 

SECTION 10.3
Governing Law: Submission to Jurisdiction.

 

(a)
THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT OR ANY OTHER FACILITY DOCUMENT (EXCEPT, AS TO
ANY OTHER FACILITY DOCUMENT, AS EXPRESSLY SET FORTH THEREIN) SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE
OF NEW YORK.

 

(b)
Each party hereto irrevocably and unconditionally:

 

(i)
submits for itself and its property in any legal action or proceeding relating to this Agreement or the other Facility Documents
to which it is a party, or for recognition and enforcement of any judgment in respect thereof, to the non-exclusive general jurisdiction
of the courts of the State of New York in the Borough of Manhattan, the courts of the United States of America for the Southern District
of New York, and the appellate courts of any of them;

 

(ii) consents that any such action or proceeding may be brought in any court described in Section 10.3(b)(i) and waives to the
fullest extent permitted by Applicable Law any objection that it may now or hereafter have to the venue of any such action or proceeding
in any such court or that such action or proceeding was brought in an inconvenient court and agrees not to plead or claim the same;

 

(iii) agrees
that service of process in any such action or proceeding may be effected by mailing a copy thereof by registered or certified mail (or
any substantially similar form of mail), postage prepaid, to such party at its address set forth in Section 10.4 or at such other
address as may be permitted thereunder;

 

    -25-

     

    

 

(iv) agrees that nothing herein shall affect the right to effect service of process in any other manner permitted by law; and

 

(v) waives, to the maximum extent not prohibited by law, any right it may have to claim or recover in any legal action or proceeding
against any Secured Party arising out of or relating to this Agreement or any other Facility Document any special, exemplary, punitive
or consequential damages.

 

SECTION 10.4
Notices. All notices and other communications provided for hereunder shall, unless otherwise stated herein, be in writing
(including facsimile communication) and shall be personally delivered or sent by certified mail, electronic mail, postage prepaid, or
by facsimile, to the intended party at the address or facsimile number of such party set forth below:

 

(a)
in the case of the Purchaser:

 

SARATOGA INVESTMENT FUNDING II LLC

535 Madison Avenue, 4th Floor

New York, NY 10022

Attention: Henri Steenkamp and Christine Ramdihal

Telephone: 212-906-7322 and 212-906-7846

Email: hsteenkamp@saratogapartners.com and

           cramdihal@saratogapartners.com

 

in the case of the Seller:

 

SARATOGA INVESTMENT CORP.

535 Madison Avenue, 4th Floor

New York, NY 10022

Attention: Henri Steenkamp and Christine Ramdihal

Telephone: 212-906-7322 and 212-906-7846

Email: hsteenkamp@saratogapartners.com and

           cramdihal@saratogapartners.com

 

Notices and communications
by facsimile and e-mail shall be effective when sent, and notices and communications sent by other means shall be effective when received.

 

SECTION 10.5
Severability of Provisions. Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall,
as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions
hereof or affecting the validity or enforceability of such provision in any other jurisdiction.

 

SECTION 10.6
Further Assurances.

 

(a)
The Purchaser and the Seller each agree that at any time and from time to time, at its expense and upon reasonable request of the
Administrative Agent or the Collateral Agent, it shall promptly execute and deliver all further instruments and documents, and take all
reasonable further action, that is necessary or desirable to perfect and protect the Conveyances and security interests granted or purported
to be granted by this Agreement or to enable the Collateral Agent or any of the Secured Parties to exercise and enforce its rights and
remedies under this Agreement with respect to any Collateral. Without limiting the generality of the foregoing, the Seller authorizes
the filing of such financing or continuation statements, or amendments thereto, and such other instruments or notices as may be necessary
or desirable or that the Purchaser or the Collateral Agent (acting solely at the Administrative Agent’s request) as the assignee
of the Purchaser may reasonably request to protect and preserve the Conveyances and security interests granted by this Agreement.

 

(b)
The Purchaser and the Seller agree to do and perform, from time to time, any and all acts and to execute any and all further instruments,
in each case, reasonably requested by the other party more fully to effect the purposes of this Agreement and the other Facility Documents,
including the execution of any financing statements or continuation statements or equivalent documents relating to the Transferred Collateral
Loans for filing under the provisions of the UCC or other laws of any applicable jurisdiction.

 

    -26-

     

    

 

(c)
The Purchaser and the Seller hereby severally authorize the Collateral Agent, upon receipt of written direction from the Administrative
Agent, to file one or more financing or continuation statements, and amendments thereto, relating to all or any part of the Transferred
Assets.

 

(d)
The Seller shall furnish to the Collateral Agent and the Administrative Agent from time to time such statements and schedules further
identifying and describing the Related Security and such other reports in connection with the Transferred Assets as the Collateral Agent
(acting solely at the Administrative Agent’s request) or the Administrative Agent may reasonably request, all in reasonable detail.

 

SECTION 10.7
No Waiver; Cumulative Remedies. No failure to exercise and no delay in exercising, on the part of the Purchaser, the Seller
or the Administrative Agent, any right, remedy, power or privilege hereunder, shall operate as a waiver thereof; nor shall any single
or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise
of any other right, remedy, power or privilege. The rights, remedies, powers and privileges herein provided are cumulative and not exhaustive
of any rights, remedies, powers and privilege provided by law.

 

SECTION 10.8
Costs, Expenses and Taxes. 

 

(a)
without duplication of any indemnification payments or reimbursement payments made by the Seller or the Purchaser (pursuant to
Section 12.04 of the Credit Agreement or otherwise), the Seller agrees to pay on demand all reasonable, invoiced out-of-pocket costs
and expenses of the Purchaser or its assignees incurred in connection with the preparation, execution, delivery, enforcement,
administration (including periodic auditing), renewal, 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, without limitation, the
reasonable fees and out–of–pocket expenses of counsel with respect thereto and with respect to advising the Purchaser or
its assignees as to its rights and remedies under this Agreement and the other documents to be delivered hereunder or in connection
herewith, and all invoiced out-of-pocket costs and expenses, if any (including reasonable counsel fees and expenses), incurred by
the Purchaser or its assignees in connection with the enforcement of this Agreement and the other documents to be delivered
hereunder or in connection herewith.

 

(a)
The Seller shall pay on demand any and all stamp, sales, excise and other similar Taxes and fees payable or determined to be payable
to any Governmental Authority in connection with the execution, delivery, filing and recording of this Agreement and the other documents
to be delivered hereunder.

 

(b)
The Seller shall pay on demand all other reasonable, invoiced out-of-pocket costs and expenses incurred by the Purchaser or, to
the extent not paid by the Purchaser, its assignees in connection with the execution, delivery, filing and recording of this Agreement
and the other documents to be delivered hereunder.

 

SECTION 10.9
Counterparts. This Agreement may be executed in two or more counterparts including telecopy transmission thereof (and by
different parties on separate counterparts), each of which shall be an original, but all of which together shall constitute one and the
same instrument. Delivery of an executed counterpart of a signature page to this Agreement by email or other electronic transmission will
be effective as delivery of a manually executed counterpart thereof.

 

SECTION 10.10 Binding
Effect; Assignability; Third-Party Beneficiaries. (a) This Agreement will inure to the benefit of and
be binding upon the parties hereto and their respective successors and permitted assigns. The Administrative Agent and the Collateral
Agent, for the benefit of the Secured Parties, are intended by the parties hereto to be third-party beneficiaries of this Agreement.

 

(a)
Notwithstanding anything to the contrary contained herein, this Agreement may not be assigned by the Purchaser or the Seller except
as permitted by this Section 10.10 or the Credit Agreement. Simultaneously with the execution and delivery of this Agreement, the
Purchaser will assign all of its right, title and interest in this Agreement to the Collateral Agent, for the benefit of the Secured Parties,
to which assignment the Seller hereby expressly consents. Upon assignment, the Seller agrees to perform its obligations hereunder for
the benefit of the Collateral Agent, for the benefit of the Secured Parties, under the Credit Agreement and the Collateral Agent, in such
capacity, shall be a third party beneficiary hereof. The Collateral Agent, for the benefit of the Secured Parties, under the Credit Agreement
upon such assignment may enforce the provisions of this Agreement, exercise the rights of the Purchaser and enforce the obligations of
the Seller hereunder without joinder of the Purchaser.

 

SECTION 10.11 
Merger and Integration. Except as specifically stated otherwise herein, this Agreement and the other Facility Documents
set forth the entire understanding of the parties relating to the subject matter hereof, and all prior understandings, written or oral,
are superseded by this Agreement and the other Facility Documents.

 

    -27-

     

    

 

SECTION 10.12 Non-Petition.
The Seller hereby agrees not to institute against, or join, cooperate with or encourage any other Person in instituting against, the
Purchaser any bankruptcy, reorganization, receivership, arrangement, insolvency, moratorium or liquidation proceeding or other
proceeding under federal or state bankruptcy or similar laws until at least one year and one day, or, if longer, the applicable
preference period then in effect plus one day, after the Payment in Full of all outstanding Obligations and the termination of all
Commitments. The Seller hereby acknowledges that (i) the Purchaser has no assets other than the Transferred Assets and rights and
interests in the Facility Documents and rights incidental thereto, (ii) the Purchaser shall, immediately upon Conveyance hereunder,
grant a security interest in the Transferred Assets to the Collateral Agent, for the benefit of the Secured Parties, pursuant to the
Credit Agreement, and (iii) Collections generated by the Transferred Assets will be applied to payment of the Purchaser’s
obligations under the Credit Agreement. In addition, the Seller shall have no recourse for any amounts payable or any other
obligations arising under this Agreement against any officer, member, director, employee, partner, Affiliate or security holder of
the Purchaser or any of its successors or assigns.

 

The provisions of this Section
10.12 are a material inducement for the Purchaser to enter into this Agreement and the transactions contemplated hereby and for the
Administrative Agent and the Secured Parties to enter into the Credit Agreement and the transactions contemplated thereby and are an essential
term hereof. The Purchaser may seek and obtain specific performance of such provisions (including injunctive relief), including, without
limitation, in any bankruptcy, reorganization, arrangement, winding-up, insolvency, moratorium or liquidation proceedings, or other proceedings
under United States federal or state bankruptcy laws or any similar laws.

 

SECTION 10.13 Waiver of
Setoff.

 

(a) The
Seller’s obligations under this Agreement shall not be affected by any right of setoff, counterclaim, recoupment, defense or other
right the Seller might have against the Purchaser, the Administrative Agent, the Lenders, the Lender Agents, the Collateral Agent, the
Custodian, the other Secured Parties or any assignee of such Persons, all of which rights are hereby waived by the Seller.

 

(b) The
Purchaser shall have the right to set–off against the Seller any amounts to which the Seller may be entitled hereunder and to apply
such amounts to any claims the Purchaser may have against the Seller from time to time under this Agreement. Upon any such set–off,
the Purchaser shall give notice of the amount thereof and the reasons therefor to the Seller.

 

SECTION 10.14 
Subordination. The Seller hereby agrees that the Seller shall be subordinate in right of payment to the prior payment of
any indebtedness or obligation of the Purchaser owing to the Lenders, the Collateral Agent, the Custodian, the Administrative Agent or
any other Secured Party under the Credit Agreement.

 

SECTION 10.15 Headings. The headings herein are for purposes of reference only and shall not otherwise affect the meaning or interpretation
of any provision hereof.

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

    -28-

     

    

 

IN WITNESS WHEREOF, the Purchaser
and the Seller each have caused this Loan Sale and Contribution Agreement to be duly executed by their respective officers as of the day
and year first above written.

 

	 	SARATOGA
    INVESTMENT CORP., 
	 	as Seller
	 	 	 
	 	By:	/s/ Henri J. Steenkamp
	 		Name: Henri J. Steenkamp
	 		Title: Chief Financial &
    Compliance Officer
	 	 	 
	 	SARATOGA
    INVESTMENT FUNDING II LLC, 
	 	as Purchaser
	 	 	 
	 	By:	/s/ Henri J. Steenkamp
	 		Name: Henri J. Steenkamp
	 		Title: Chief Financial &
    Compliance OfficerExhibit 10.3
​
FORM OF RESTRICTED STOCK UNIT AGREEMENT (Stock-settled) 
​
​
NOTICE OF GRANT
RESTRICTED STOCK UNITS (STOCK-SETTLED)
LAMB WESTON HOLDINGS, INC. 2016 STOCK PLAN
(AS AMENDED AND RESTATED AS OF JULY 20, 2017)
​
Lamb Weston Holdings, Inc., a Delaware corporation (the “Company”), has awarded to the Participant, as identified below, the number of Restricted Stock Units (the “RSUs”, and each such unit, an “RSU”) set forth below. The RSUs are subject to all of the terms and conditions as set forth in this Notice of Grant (the “Notice”) as well as in the Company’s 2016 Stock Plan (as amended and restated as of July 20, 2017) (the “Plan”) and the Restricted Stock Unit Agreement (Stock-Settled) (the “Agreement”), both of which are attached hereto and incorporated in their entirety. Capitalized terms not explicitly defined in this Notice but defined in the Plan or the Agreement will have the same definitions as in the Plan or the Agreement. In the event of any conflict between the terms of the Award and the Plan, the terms of the Plan will control. 
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	Participant:
	
	Employee ID:
	
	Number of RSUs:
	
	Date of Grant:
	_____________ (the “Date of Grant”)

	Vesting Date:
	_____________ (the “Vesting Date”)

	Dividend Equivalents:  
	Dividend equivalents with respect to the RSUs will be accumulated for the benefit of the Participant if and when regular cash dividends are declared and paid on the Stock in accordance with Section 7 of the Agreement, and will be paid in shares of Stock to the Participant upon any settlement of the RSUs.

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By the Company’s signature below and by the Participant’s clicking the “Accept” button online, the Company and the Participant agree that the RSUs are governed by this Notice and by the provisions of the Plan and the Agreement, both of which are attached to and made a part of this document.  The Participant acknowledges receipt of copies of the Plan and the Agreement, represents that the Participant has read and is familiar with their provisions, and hereby accepts the RSUs subject to all of their terms and conditions.
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The Company has caused this Notice and the Agreement to be effective as of the Date of Grant.
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	LAMB WESTON HOLDINGS, INC.
By:  ​ ​​ ​​ ​​ ​
Date:     __________________________
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RESTRICTED STOCK UNIT AGREEMENT (STOCK-SETTLED)
LAMB WESTON HOLDINGS, INC. 2016 STOCK PLAN
(AS AMENDED AND RESTATED AS OF JULY 20, 2017)
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Lamb Weston Holdings, Inc., a Delaware corporation (the “Company”), has awarded the Participant, as named in the Notice of Grant (the “Notice”), to which this Restricted Stock Unit Agreement (Stock-Settled) (this “Agreement”) is attached, a Restricted Stock Unit Award (the “RSUs”) that is subject to the Company’s 2016 Stock Plan (as amended and restated as of July 20, 2017) (the “Plan”), the Notice, and this Agreement, for the number of RSUs indicated in the Notice.  In the event of any conflict between the terms in this Agreement and the Plan, the terms of the Plan will control. 
1.Definitions.   Capitalized terms used herein without definition have the meanings set forth in the Plan. The following terms shall have the respective meanings set forth below:

(a)“Change of Control” shall mean the occurrence of any of the following events:

(i)Individuals who, as of the effective date of the Plan, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any person becoming a member of the Board subsequent to the effective date of the Plan whose election, or nomination for the election by the Company’s stockholders, was approved by a vote of at least a majority of the Board members then comprising the Incumbent Board shall be, for purposes of this clause (i), considered as though such person were a member of the Incumbent Board as of the effective date of the Plan;
(ii)Consummation of a reorganization, merger or consolidation, in each case, with respect to which persons who were the stockholders of the Company immediately prior to such reorganization, merger or consolidation do not, immediately thereafter, own more than 50% of the Voting Power of the reorganized, merged or consolidated entity;
(iii)Any person becomes the beneficial owner, directly or indirectly, of securities of the Company (not including in the securities beneficially owned by such person, any securities acquired directly from the Company or its affiliates) representing 30% or more of the Voting Power of the Company’s then outstanding securities; 
(iv)A liquidation or dissolution of the Company; or
(v)The sale of all or substantially all of the assets of the Company.

(b)“Continuous Employment” shall mean the absence of any interruption or termination of employment with the Company and its Subsidiaries and the performance of substantial services.  Continuous Employment shall not be considered interrupted or terminated in the case of sick leave, short-term disability (as defined in the Company’s sole discretion), military leave or any other leave of absence approved by the Company unless and until there is a Separation from Service (as defined in Section 1(f) below).
(c)“Divestiture” shall mean a permanent disposition to a person other than the Company of a plant or other facility or property at which the Participant performs a majority of the Participant’s services, whether such disposition is effected by means of a sale of assets, a sale of Subsidiary stock or otherwise.
(d)“Early Retirement” shall mean a Separation from Service with the Company and its Subsidiaries when the Participant (i) is at least age 55, and (ii) has at least ten years of credited service with the Company and its Subsidiaries.
(e)“Normal Retirement” shall mean a Separation from Service with the Company and its Subsidiaries on or after attaining age 65.
(f)“Separation from Service,” “termination of employment” and similar terms shall mean the date that the Participant incurs a “separation from service” within the meaning of Section 409A of the Code.  As used in connection with the definition of “Separation from Service,” the term “Company” includes Lamb Weston Holdings, Inc. and any other entity that with Lamb Weston Holdings, Inc. constitutes a controlled group of corporations (as defined in Section 414(b) of the Code), or a group of trades or businesses (whether or not incorporated) under common control (as defined in Section 414(c) of the Code), substituting 25% for the 80% ownership level for purposes of both Sections 414(b) and Section 414(c) of the Code.
(g)“Specified Employee” is as defined under Section 409A of the Code and Treasury Regulation Section 1.409A-1(i).  

(h)“Successors” shall mean the beneficiaries, executors, administrators, heirs, successors and assigns of a person.

2.Vesting of RSUs. 

(a)Normal Vesting.  Subject to the Plan and this Agreement, if the Participant has been in Continuous Employment through the Vesting Date as set forth in the Notice, then the RSUs subject to such Vesting Date will become nonforfeitable (“Vest” or similar terms).
(b)Termination of Employment.  If, prior to the Vesting Date set forth in the Notice, the Participant’s employment with the Company and its Subsidiaries shall terminate:
(i)by reason of death, then all unvested RSUs evidenced by this Agreement shall, to the extent such RSUs have not previously been forfeited, become 100% Vested;
(ii)by reason of Normal Retirement occurring on or after the date that is 12 months after the Date of Grant, then all unvested RSUs evidenced by this Agreement shall, to the extent such RSUs have not previously been forfeited, become 100% Vested;
(iii)by reason of Early Retirement or involuntary termination due to disability, position elimination, reduction in force (each as defined in the Company's sole discretion), or Divestiture, in each case, on or after the date that is 12 months after the Date of Grant, the Participant will Vest in a pro rata portion of the RSUs determined by multiplying the number of RSUs evidenced by this Agreement, to the extent not previously Vested or forfeited, by a fraction, the numerator of which is the total number of calendar days during which the Participant was employed by the Company or a Subsidiary during the period beginning on the Date of Grant and ending on the Separation from Service and the denominator of which is the total number of calendar days beginning on the Date of Grant and ending on the Vesting Date, rounded to the nearest whole number of RSUs; and
(iv)for Cause prior to the Vesting Date, then all RSUs, whether Vested or unvested prior to the Vesting Date, shall be immediately forfeited without further consideration to the Participant.

(c)Accelerated Vesting in Connection with a Change of Control.
(i)If a Change of Control occurs prior to the Vesting Date, and the Participant has been in Continuous Employment between the Date of Grant and the date of such Change of Control, then all unvested RSUs evidenced by this Agreement shall become 100% Vested, except (A) to the extent such RSUs have previously been forfeited, or (B) to the extent that a Replacement Award is provided to the Participant to replace, continue or adjust the outstanding RSUs (the “Replaced Award”).  If the Participant’s employment with the Company or a Subsidiary (or any of its or their successors after the Change of Control) (as applicable, the “Successor Company”) is terminated by the Participant for Good Reason or by the Successor Company other than for Cause, in each case within a period of two years after the Change of Control but prior to the Vesting Date, to the extent that the Replacement Award has not previously been Vested or forfeited, the Replacement Award will become 100% Vested (and become entitled to settlement as specified in Section 3(b)(ii)).
(ii)For purposes of this Agreement, a “Replacement Award” means an award (A) of the same type (i.e., time-based restricted stock units) as the Replaced Award, (B) that has a value at least equal to the value of the Replaced Award, (C) that relates to publicly traded equity securities of the Successor Company in the Change of Control (or another entity that is affiliated with the Successor Company following the Change of Control), (D) the tax consequences of which for such Participant under the Code, if the Participant is subject to U.S. federal income tax under the Code, are not less favorable to the Participant than the tax consequences of the Replaced Award, and (E) the other terms and conditions of which are not less favorable to the Participant than the terms and conditions of the Replaced Award (including the provisions that would apply in the event of a subsequent change of control).  A Replacement Award may be granted only to the extent it does not result in the Replaced Award or Replacement Award failing to comply with or ceasing to be exempt from Section 409A of the Code.  Without limiting the generality of the foregoing, the Replacement Award may take the form of a continuation of the Replaced Award if the requirements of the preceding two sentences are satisfied.  The determination of whether the conditions of this Section 2(c)(ii) are satisfied will be made in good faith by the Committee, as constituted immediately before the Change of 

Control, in its sole discretion.
(iii)For purposes of this Agreement, “Cause” means: (A) the willful and continued failure by the Participant to substantially perform the Participant’s duties with the Successor Company (other than any such failure resulting from termination by the Participant for Good Reason) after a demand for substantial performance is delivered to the Participant that specifically identifies the manner in which the Successor Company believes that the Participant has not substantially performed the Participant’s duties, and the Participant has failed to resume substantial performance of the Participant’s duties on a continuous basis within five days of receiving such demand; (B) the willful engaging by the Participant in conduct which is demonstrably and materially injurious to the Successor Company, monetarily or otherwise; or (C) the Participant’s conviction of, or plea of nolo contendere to, (I) a felony or (II) a misdemeanor which impairs the Participant’s ability substantially to perform the Participant’s duties with the Successor Company.  For the purposes of this definition, no act, or failure to act, on the Participant’s part shall be deemed “willful” unless done, or omitted to be done, by the Participant not in good faith and without reasonable belief that the Participant’s action or omission was in the best interest of the Successor Company.
(iv)For purposes of this Agreement, “Good Reason” means: (A) any material failure of the Successor Company to comply with and satisfy any of the terms of any employment or change in control (or similar) agreement between the Successor Company and the Participant pursuant to which the Participant provides services to the Successor Company; (B) any significant involuntary reduction of the authority, duties or responsibilities held by the Participant immediately prior to the Change of Control (and, for the avoidance of doubt, involuntary removal of the Participant from an officer position that the Participant holds immediately prior to the Change of Control will not, by itself, constitute a significant involuntary reduction of the authority, duties or responsibilities held by the Participant immediately prior to the Change of Control); (C) any material involuntary reduction in the aggregate target cash remuneration opportunity of the Participant as in effect immediately prior to the Change of Control; or (D) requiring the Participant to become based at any office or location more than 50 miles from the office or location at which the Participant was based immediately prior to such Change of Control, except for travel reasonably required in the performance of the Participant’s responsibilities; provided, however, that no termination shall be deemed to be for Good Reason unless (x) the Participant provides the Successor Company with written notice setting forth the specific facts or circumstances constituting Good Reason within ninety days after the initial existence of the occurrence of such facts or circumstances, (y) the Successor Company fails to cure such facts or circumstances within thirty days of its receipt of such written notice, and (z) the Participant actually terminates employment within thirty (30) days following the end of the Successor Company’s thirty-day cure period, if such event or circumstance has not been cured.
(v)If a Replacement Award is provided, notwithstanding anything in this Agreement to the contrary, any outstanding RSUs which at the time of the Change of Control are not subject to a "substantial risk of forfeiture" (within the meaning of Section 409A of the Code) will be deemed to be Vested at the time of such Change of Control (and such Vested RSUs shall be settled in accordance with Section 3(b)(iii) below).

(d)Forfeiture of RSUs.  Subject to Section 2(b)(iv), any RSUs that have not Vested pursuant to Section 2(a), Section 2(b), or Section 2(c) as of the Vesting Date will be forfeited automatically and without further notice on such date (or earlier if, and on such date that, the Participant ceases to be in Continuous Employment prior to the Vesting Date for any reason other than as described in Section 2(b) or Section 2(c)).

3.Settlement of RSUs.

(a)Normal.  Subject to Section 3(b), the Company will issue to the Participant one share of Stock on the Vesting Date for each RSU that is a Vested RSU on such Vesting Date to the extent the RSU has not previously been Vested, forfeited or settled.
(b)Other Settlement Events.  Notwithstanding Section 3(a), to the extent the RSUs are Vested RSUs on the dates set forth below and to the extent the Vested RSUs have not previously been Vested, forfeited or settled, the Company will settle such Vested RSUs as follows:

(i)Death.  If there are such Vested RSUs on the Participant's death, within thirty days of the Participant's death, one share of Stock will be issued for each such Vested RSU.
(ii)Separation from Service.  If there are such Vested RSUs upon the Participant's Separation from Service by reason of involuntary termination due to disability, position elimination, reduction in force or Divestiture pursuant to Section 2(b)(iii) hereof, within thirty days of the Participant's Separation from Service, one share of Stock will be issued for each such Vested RSU. If there are such Vested RSUs upon the Participant’s Separation from Service by reason of the Participant’s Retirement or Early Retirement, the settlement of such Vested RSUs will not be accelerated and one share of Stock will be issued for each such Vested RSU on the Vesting Date, and with respect to Early Retirement, the amount settled on the Vesting Date shall be a pro-rated amount of the originally scheduled installment using the pro-ration factor determined under Section 2(b)(iii) hereof.  Notwithstanding anything in this Agreement to the contrary, if any Vested RSUs under the immediately preceding sentence are outstanding as of a Change of Control, then such Vested RSUs shall be settled in accordance with Section 3(b)(iii) below.
(iii)Change of Control.  If there are such Vested RSUs upon a Change of Control, one share of Stock will be issued for each such Vested RSU as of the date of the Change of Control; provided, however, that if such Change of Control would not qualify as a permissible date of distribution under Section 409A(a)(2)(A) of the Code, and the regulations thereunder, and where Section 409A of the Code applies to such distribution, the Participant is entitled to receive the corresponding payment on the date that would have otherwise applied pursuant to Section 3 as though such Change of Control had not occurred.

(c)Payment of Taxes Upon Settlement.  As a condition of the issuance of shares of Stock upon settlement of RSUs hereunder, the Participant agrees to remit to the Company at the time of settlement any taxes or other amounts required to be withheld by the Company under Federal, State or local law as a result of the settlement of the RSUs. As a condition of the issuance of shares of Stock upon settlement of RSUs hereunder, the Participant agrees that the Company will deduct from the total shares to be issued as a result of the Vesting of the RSUs a sufficient number of shares to satisfy the required statutory withholding amount, which may exceed the minimum statutory tax withholding amount permissible only if it would not cause adverse accounting or tax consequences for the Company or a Subsidiary.
(d)Specified Employee.  Notwithstanding anything (including any provision of the Agreement or the Plan) to the contrary, if a Participant is a Specified Employee and if the RSUs are subject to Section 409A of the Code, payment to the Participant on account of a Separation from Service shall, to the extent required to comply with Treasury Regulation Section 1.409A-3(i)(2), be made to the Participant on the earlier of (i) the Participant’s death or (ii) the first business day (or within 30 days after such first business day) that is more than six months after the date of Separation from Service.  Notwithstanding anything contained herein to the contrary, the Participant shall not be considered to have terminated employment with the Company or any Subsidiary for purposes of any payments under this Agreement which are subject to Section 409A of the Code until the Participant has incurred a Separation from Service.  In the Company’s sole and absolute discretion, interest may be paid due to such delay.  Further, any interest will be calculated in the manner determined by the Company in its sole and absolute discretion in a manner that qualifies any interest as reasonable earnings under Section 409A of the Code.  Dividend equivalents will not be paid with respect to any dividends that would have been paid during the delay if the Stock had been issued.  To the extent required for purposes of Section 409A of the Code, each installment that vests under this Agreement shall be construed as a separate identified payment for purposes of Section 409A of the Code.

4.Non-Transferability of RSUs. The RSUs may not be assigned, transferred, pledged or hypothecated in any manner (otherwise than by will or the laws of descent or distribution) nor may the Participant enter into any transaction for the purpose of, or which has the effect of, reducing the market risk of holding the RSUs by using puts, calls or similar financial techniques. The RSUs subject to this Agreement may be settled during the lifetime of the Participant only with the Participant or the Participant’s guardian or legal representative. Upon any attempt to transfer, assign, pledge, hypothecate, or otherwise dispose of the RSUs or any related rights to the RSUs that is contrary to the provisions of this Agreement or the Plan, or upon the levy of any attachment or similar process upon the RSUs or such rights, the RSUs and such rights shall immediately become null and void. The terms of this Agreement, shall be binding upon the Successors of the Participant.

5.Stock Subject to the RSUs; Compliance with Law.  The Company will not be required to issue or deliver any shares of Stock or any certificate or certificates for shares of Stock with respect to the Participant’s RSUs until such shares have been listed (or authorized for listing upon official notice of issuance) upon each stock exchange on which outstanding shares of the same class are then listed and until the Company has taken such steps as may, in the opinion of counsel for the Company, be required by law and applicable regulations, including the rules and regulations of the Securities and Exchange Commission, and state securities laws and regulations, in connection with the issuance of such shares, and the listing of such shares on each such exchange. 
6.Rights as Stockholder.  The Participant or his/her Successors shall have no rights as stockholder with respect to any RSUs or underlying shares of Stock covered by this Agreement until the Participant or his/her Successors shall have become the beneficial owner of such shares, and, except as provided in Section 7 and Section 8 of this Agreement, no adjustment shall be made for dividends or distributions or other rights in respect of such shares for which the record date is prior to the date on which the Participant or his/her Successors shall have become the beneficial owner thereof.
7.Dividend Equivalents.  From and after the Date of Grant and until the earlier of (a) the time when the RSUs become Vested and are settled in accordance with Section 2 and Section 3 of this Agreement or (b) the time when the Participant’s right to receive shares of Stock in settlement of the RSUs is forfeited in accordance with Section 2 of this Agreement, on the date that the Company pays a cash dividend (if any) to holders of Stock generally, the Participant shall be entitled to a number of additional RSUs determined by dividing (i) the product of (x) the dollar amount of the cash dividend paid per share of Stock on such date and (y) the total number of RSUs (including dividend equivalents paid thereon) previously credited to the Participant as of such date, by (ii) the Fair Market Value of the Stock on such date.  Such dividend equivalents (if any) shall be subject to the same terms and conditions and shall be paid, in the aggregate rounded down to the nearest whole number, or forfeited in the same manner and at the same time as the RSUs to which the dividend equivalents were credited.
8.Adjustments Upon Changes in Capitalization; Change of Control.  In the event of any change in corporate capitalization, corporate transaction, sale or other disposition of assets or similar corporate transaction or event involving the Company as described in Section 5.5 of the Plan, the Committee shall make equitable adjustment as it determines necessary and appropriate in the number and type of shares subject to this Agreement; provided, however, that no fractional share shall be issued upon subsequent settlement of the RSUs.  No adjustment shall be made if such adjustment is prohibited by Section 5.5 of the Plan (relating to Section 409A of the Code).
9.Notices.  Each notice relating to this Agreement shall be deemed to have been given on the date it is received. Each notice to the Company shall be addressed to its principal Office in Eagle, Idaho, Attention: Compensation. Each notice to the Participant or any other person or persons entitled to shares issuable upon settlement of the RSUs shall be addressed to the Participant’s address and may be in written or electronic form. Anyone to whom a notice may be given under this Agreement may designate a new address by giving notice to the effect.
10.Benefits of Agreement. This Agreement shall inure to the benefit of and be binding upon each successor of the Company. All obligations imposed upon the Participant and all rights granted to the Company under this Agreement shall be binding upon the Participant's Successors. This Agreement shall be the sole and exclusive source of any and all rights which the Participant or his/her Successors may have in respect to the Plan or this Agreement.
11.No Right to Continued Employment.  Nothing in this Agreement shall interfere with or affect the rights of the Company or the Participant under any employment agreement or confer upon the Participant any right to continued employment with the Company or a Subsidiary.
12.Resolution of Disputes.  Any dispute or disagreement which should arise under or as a result of or in any way related to the interpretation, construction or application of this Agreement will be determined by the Committee. Any determination made hereunder shall be final, binding and conclusive for all purposes. This Agreement and the legal relations between the parties hereto shall be governed by and construed in accordance with the laws of the state of Delaware.
13.Section 409A of the Code.  To the extent applicable, this Agreement is intended to comply with Section 409A of the Code and any regulations or notices provided thereunder.  This Agreement and the Plan shall be interpreted in a manner consistent with this intent. The Company reserves the unilateral right to amend this Agreement on written notice to the Participant in order to comply with Section 409A of the Code.  The Company makes no representation that any or all of the payments described in this Agreement will be exempt from or comply with Section 409A of the Code and makes no undertaking to preclude Section 

409A of the Code from applying to any such payment.  None of the Company or any Subsidiary, or any of its or their contractors, agents and employees, nor the Board or any member of the Board, shall be liable for any consequences of any failure to follow the requirements of Section 409A of the Code or any guidance or regulations thereunder.
14.Clawback Policy and Stock Ownership Guidelines.  Shares of Stock issued upon settlement of the RSUs shall be subject to any stock ownership guidelines of the Company applicable to the Participant. In addition to the clawback described in Section 18(b) of this Agreement, this Agreement and the RSUs are subject to the Company’s clawback policy applicable to the Participant  as may be in effect from time to time, including, as applicable, being subject to recoupment or clawback by the Company on the terms and conditions as provided for under Section 10D of the Act and any applicable rules or regulations promulgated by the Securities and Exchange Commission or any national securities exchange or national securities association on which the Stock may be traded.  
15.Amendment.  Any amendment to the Plan shall be deemed to be an amendment to this Agreement to the extent that the amendment is applicable hereto.
16.Severability.  If any provision of this Agreement or the application of any provision hereof to any person or circumstances is held invalid, unenforceable or otherwise illegal, the remainder of this Agreement and the application of such provision to any other person or circumstances shall not be affected, and the provisions so held to be invalid, unenforceable or otherwise illegal shall be reformed to the extent (and only to the extent) necessary to make it enforceable, valid and legal.
17.Electronic Delivery.  The Company may, in its sole discretion, deliver any documents related to the RSUs and the Participant’s participation in the Plan, or future awards that may be granted under the Plan, by electronic means or request the Participant’s consent to participate in the Plan by electronic means.  The Participant hereby consents to receive such documents by electronic delivery and, if requested, agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company.
18.Restrictive Covenants.  

(a)Confidentiality.  It is a condition to the Participant’s receipt of the RSUs that the Participant execute and agree to the terms of the Company or a Subsidiary’s current and applicable Confidentiality Agreement (the “Confidentiality Agreement”).  By electronically accepting this Agreement, the Participant acknowledges that the Participant has either already entered into such Confidentiality Agreement with the Company or a Subsidiary as of the date of acceptance or will enter into such agreement within 30 days of the Participant’s receipt of this grant of RSUs.  If such execution is required and the Participant does not sign and return the Confidentiality Agreement as prompted by the Workday HR system within 30 days of the Participant’s receipt of this grant of RSUs, this grant of RSUs and any rights to the RSUs will terminate and become null and void.  The Participant further acknowledges that as consideration for the Participant’s agreement to the terms of the Confidentiality Agreement, the Company is providing the Participant with the opportunity to participate in this grant of RSUs under the Plan and receive the RSUs evidenced by this Agreement.  The Participant understands that this acknowledgment shall be deemed a part of the Confidentiality Agreement and is to be interpreted in a manner consistent with its terms.
(b)Non-Competition and Non-Solicitation.  By electronically accepting this Agreement, the Participant acknowledges that the Participant has received or will receive specialized training, trade secrets and confidential information from the Company and, in consideration thereof, agrees to the non-competition and non-solicitation provisions set forth in Exhibit A to this Agreement (the “Non-Competition and Non-Solicitation Obligations”). The Participant further acknowledges that as consideration for the Participant’s agreement to the terms of the Non-Competition and Non-Solicitation Obligations, the Company is providing the Participant with the opportunity to participate in this grant of RSUs under the Plan and receive the RSUs evidenced by this Agreement. Notwithstanding the foregoing, if the Participant is a resident of the state of California, the Participant will not be bound by the Non-Competition and Non-Solicitation Obligations.
(c)Violation of Restrictive Covenants.  Notwithstanding anything herein to the contrary, if the Participant breaches the Confidentiality Agreement or, if applicable, any of the Non-Competition and Non-Solicitation Obligations, (i) the Participant shall forfeit all RSUs and related dividend equivalents evidenced by this Agreement, effective on the date on which the Participant first breached such agreement or obligation(s) and (ii) if such breach occurs within 1 year following (A) the Vesting Date or (B) to the extent Section 3(b) applies, the applicable settlement date, all shares of Stock issued or transferred to the Participant pursuant to this Agreement shall be returned by the Participant to the Company within 30 days after the Company has provided notice to the Participant of such breach and, if 

such shares of Stock have been sold by the Participant, an amount equal to the proceeds from such sale (determined without regard to any taxes paid) shall become due and payable by the Participant to the Company within 30 days after the Company has provided notice to the Participant of such breach. Notwithstanding the foregoing, the Committee, in its sole discretion, may waive the Participant obligations described in clause (i) and (ii) at any time if deemed to be in the best interests of the Company. The Participant acknowledges and agrees that it would be inequitable for the Participant to benefit from the RSUs should the Participant breach the Confidentiality Agreement or, if applicable, any of the Non-Competition and Non-Solicitation Obligations.  
(d)Remedies; Government Investigations; DTSA.  The Participant acknowledges and agrees that the rights and remedies set forth in this Section 18 are in addition to and are not intended to limit any other rights or remedies the Company may have available to it, both during and at any time after the termination of the Participant’s employment with the Company, including, without limitation, any rights or remedies the Company may have under the Confidentiality Agreement or other similar agreements.  Notwithstanding anything in this Agreement to the contrary, nothing in this Agreement prevents the Participant from providing, without prior notice to the Company, information to governmental authorities regarding possible legal violations or otherwise testifying or participating in any investigation or proceeding by any governmental authorities regarding possible legal violations, and, for purpose of clarity, the Participant is not prohibited from providing information voluntarily to the Securities and Exchange Commission pursuant to Section 21F of the Act.  Furthermore, the U.S. Defend Trade Secrets Act of 2016 (“DTSA”) provides that an individual shall not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that (i) is made (A) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney; and (B) solely for the purpose of reporting or investigating a suspected violation of law or (ii) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal.  In addition, the DTSA provides that an individual who files a lawsuit for retaliation by an employer for reporting a suspected violation of law may disclose the trade secret to the attorney of the individual and use the trade secret information in the court proceeding, if the individual (x) files any document containing the trade secret under seal and (y) does not disclose the trade secret, except pursuant to court order.

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Exhibit A
Non-Competition and Non-Solicitation Provisions
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	1.	Definitions. Unless otherwise defined, capitalized terms used in this Exhibit A shall have the meanings given to them in the Agreement or the Plan, as applicable. As used in this Exhibit A: 

		(a)	“Company” shall include all Subsidiaries of the Company.

		(b)	“Competing Organization” is defined as any organization that researches, develops, manufactures, markets, distributes and/or sells one or more Competing Products/Services.

		(c)	“Competing Products/Services” means any products, services or activities (including, without limitation, products, services or activities in the planning or development stage during the Non-Compete Period) that compete, directly or indirectly, in whole or in part, with one or more of the material products, services or activities (including, without limitation, products, services or activities in the planning or development stage during the Non-Compete Period) produced, provided, or engaged in by the Company or its affiliates at the time of the Participant’s termination of employment with the Company and with which the Participant worked or about which the Participant obtained any trade secret or other Confidential and Proprietary Information at any time during the five (5) years immediately preceding the Participant’s termination of employment with the Company. “Material products, services or activities” means the development, manufacture or production of packaged potato, sweet potato, appetizer and vegetable products for the retail, foodservice or institutional channels. If the products manufactured, sold or marketed by the Company are expanded at any time during the Participant's employment, such additional products will be deemed to be “material products, services or activities” for all purposes under this Agreement.

		(d)	“Confidential and Proprietary Information” is defined as information and data of any kind, in any form, not generally available to the public, concerning any matters affecting or relating to the Company, including but not limited to: names, addresses, and any other characteristics identifying information or aspects of existing or potential Company customers, employees, vendors or suppliers; the business or operations of the Company and/or the financials, products, drawings, plans, processes; or other data of the Company not generally known or available outside of the Company. This definition also includes derivations of Confidential and Proprietary Information, including any information derived, summarized or extracted from any of the foregoing whether observed in writing, electronically, mechanically, and/or orally during the Participant’s employment with the Company.

		(e)	“Employee” (including its plural) means any person employed by the Company.

		(f)	“Non-Compete Period” means the period from the date of the Agreement through the twelve-month period following the Participant’s termination of employment with the Company for any reason.

		(g)	“Prohibited Capacity” is defined as (i) any same or similar capacity to that the Participant held at any time during the last three years of employment with the Company prior to the date of the Participant’s termination of employment from the Company; (ii) any executive or managerial capacity; (iii) any marketing or sales capacity; or (iv) any capacity in which the Participant’s knowledge of Confidential and Proprietary Information would render the Participant’s assistance to a Competing Organization a competitive advantage.

		(h)	“Restricted Geographic Area” is defined as all countries, territories, parishes, municipalities and states in which the Company is doing business or is selling its products at the time of the Participant’s termination of employment with the Company, including, but not limited to, every 

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			parish and municipality in the state of Louisiana.1 The Participant acknowledges that this geographic scope is reasonable given the Participant’s position with the Company, the international scope of the Company’s business, and the fact that the Participant could compete with the Company from anywhere the Company does business.

		(i)	“Trade Secret” means information possessed by or developed for the Company, including, without limitation, any compilation of data, program, device, method, system, technique or process, where: (i) the information derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use, (ii) the information is the subject of efforts to maintain its secrecy that are reasonable under the circumstances, or (iii) information that constitutes a “trade secret” under the Idaho Trade Secrets Act, IDAHO STAT. § 48-801(5) and/or under the DTSA.

	2.	Non-Competition. During the Non-Compete Period, the Participant agrees that he or she will not, within the Restricted Geographic Area, be employed by, work for, consult with, provide services to, or lend assistance to any Competing Organization in a Prohibited Capacity. 

	3.	Non-Solicitation. The Participant recognizes and agrees that the Company has a legitimate business interest in restricting potential competitors from hiring Employees who possess or otherwise may have or had access to the Company’s or any of its affiliates’ Confidential and Proprietary Information or Trade Secrets. Therefore, the Participant agrees that during the Participant’s employment with the Company and through the twelve-month period following the termination of the Participant’s employment with the Company, the Participant shall not directly or indirectly through any other person or entity recruit, induce, or attempt to induce any Employee to terminate his or her employment with the Company or otherwise interfere in any way with the employment relationship between the Company and its Employees. This restriction includes, but is not limited to: (a) identifying Employees as potential candidates for employment by name, background or qualifications; (b) recruiting or soliciting Employees; and/or (c) participating in any pre-employment interviews with Employees.

	4.	California Residents.  Notwithstanding anything in the Agreement or in this Exhibit A, if the Participant is a resident of the state of California, the non-competition and non-solicitation obligations described in this Exhibit A shall not apply.

1 These Louisiana parishes currently include Acadia, Allen, Ascension, Assumption, Avoyelles, Beauregard, Bienville, Bossier, Caddo, Calcasieu, Caldwell, Cameron, Catahoula, Claiborne, Concordia, De Soto, East Baton Rouge, East Carroll, East Feliciana, Evangeline, Franklin, Grant, Iberia, Iberville, Jackson, Jefferson, Jefferson Davis, La Salle, Lafayette, Lafourche, Lincoln, Livingston, Madison, Morehouse, Natchitoches, Orleans, Ouachita, Plaquemines, Pointe Coupee, Rapides, Red River, Richland, Sabine, St. Bernard, St. Charles, St. Helena, St. James, St. John The Baptist, St. Landry, St. Martin, St. Mary, St. Tammany, Tangipahoa, Tensas, Terrebonne, Union, Vermilion, Vernon, Washington, Webster, West Baton Rouge, West Carroll, West Feliciana and Winn.

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