Document:

Exhibit 10.2

 

EXECUTION
VERSION

 

PLEDGE
AGREEMENT

 

 

THIS PLEDGE AND SECURITY
AGREEMENT is dated June 3, 2013 by FULL CIRCLE CAPITAL CORPORATION, a Maryland corporation, having and address at 800
Westchester Avenue, Suite S-620, Rye Brook, New York 10573 (the “Pledgor”), in favor of SOVEREIGN BANK,
N.A. as agent , having an office located at 45 East 53rd Street, New York, New York 10022
(in such capacity, together with its successors in such capacity, the “Agent”).

 

W I T N E S S E T H:

 

WHEREAS, the Pledgor
is the record and beneficial owner of all of the issued and outstanding shares of capital stock and all of the membership interests,
as applicable (the “Pledged Equity Interests”), of various entities (collectively, the “Guarantors”),
all of which is set forth on Exhibit A attached hereto;

 

WHEREAS, concurrently
herewith, the Pledgor, certain lenders (the “Lenders”) and the Agent, as agent for the Lenders, are entering
into that certain Credit Agreement of even date herewith (as the same may be amended hereafter, the “Credit Agreement”)
pursuant to which the Agent and the Lenders have agreed to extend certain credit and make certain loans to the Pledgor in an aggregate
principal amount not to exceed $32,500,000, subject to the terms and conditions contained in the Credit Agreement;

 

WHEREAS, pursuant to
the Credit Agreement, the Pledgor is executing and delivering to the Lenders revolving credit notes in the maximum aggregate principal
amount of $32,500,000 to evidence the revolving loans made or to be made under the Credit Agreement (as such notes may be amended
or replaced from time to time, the “Revolving Notes”);

 

WHEREAS, in order to
secure all amounts now or hereafter owing by the Pledgor under the Credit Agreement, the Revolving Notes and the other Loan Documents
(collectively, the “Secured Obligations”), the Pledgor has agreed to grant to the Agent for the ratable benefit
of the Lenders a security interest in all of the Pledged Equity Interests and other Collateral (as such terms are defined below),
all on the terms and conditions set forth herein; and

 

NOW, THEREFORE, in
consideration of the foregoing and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged,
the parties hereto agree as follows:

 

1.            Defined
Terms. Capitalized terms used but not otherwise defined herein (including, without limitation, in the recitals to this Agreement)
shall have the meanings ascribed to such terms in the Credit Agreement.

 

    	 

    	 

    

 

2.            Pledge.

 

(a)               
As collateral security for the prompt and complete payment when due of all Secured Obligations, together with any and all
expenses which may be incurred by the Agent in enforcing any of its rights under this Agreement, the Pledgor hereby pledges, assigns,
hypothecates and transfers to the Agent, and grants to the Agent, for the ratable benefit of the Lenders, a first lien on and security
interest in the Pledged Equity Interests, together with all proceeds of the foregoing, including without limitation, the collateral
described in Sections 4 and 5 below.

 

(b)              
Concurrently herewith, the Pledgor is delivering to the Agent original stock certificates, certificates of membership interest
and warrants representing all of the Pledged Equity Interests which are certificated, together with appropriate undated stock powers
and undated assignments of membership interests duly executed in blank. Following the execution and delivery of a Custodian Agreement,
such stock certificates, certificates of membership interest and warrants may be delivered to the Custodian in accordance with
the provisions of the Custodian Agreement.

 

(c)               
The Pledgor hereby irrevocably authorizes the Agent, for the ratable benefit of the Lenders, to file from time to time such
UCC-1 financing statements and UCC-3 continuation statements as the Agent deems necessary or desirable in order to perfect its
security interest in the Collateral for the ratable benefit of the Lenders.

 

3.            Proceeds, Substitute and Additional Collateral.

 

(a)               
If, while this Agreement is in effect, the Pledgor shall become entitled to receive or shall receive any other stock certificate,
membership or other equity interest or any sum of money or other property (including, without limitation, any certificate, membership
or other equity interest issuable upon the exercise of a warrant or option or representing a stock dividend or a distribution in
connection with any reclassification, increase or reduction of capital, recapitalization or issued in connection with any reorganization
or formation of a new subsidiary of the Pledgor), option or rights, whether as an addition to, in substitution of, or in exchange
for any shares or portion of any Pledged Equity Interests, or otherwise, the Pledgor shall accept the same as an agent of the Agent,
hold the same in trust on behalf of and for the benefit of the Agent and deliver the same forthwith to the Agent in the exact form
received, with the indorsement of the Pledgor when necessary and/or appropriate undated stock powers or assignments, as applicable,
duly executed in blank, to be held by the Agent, subject to the terms hereof, as additional collateral security for the Secured
Obligations. Any sums paid upon or in respect of the Pledged Equity Interests upon the liquidation or dissolution of the issuer
thereof shall be paid over to the Agent or the Custodian to be held as additional collateral security for the Secured Obligations;
and in case any distribution of capital shall be made on or in respect of the Pledged Equity Interests or any property shall be
distributed upon or with respect to the Pledged Equity Interests pursuant to the recapitalization or reclassification of the capital
of the issuer thereof or pursuant to the reorganization thereof, the property so distributed shall be delivered to the Agent or
the Custodian to be held by it as additional collateral security for the Secured Obligations. All sums of money and property so
paid or distributed in respect of the Pledged Equity Interests which are received by the Pledgor shall, until paid or delivered
to the Agent or the Custodian, be held by the Pledgor in trust as additional collateral security for the Secured Obligations.

 

(b)              
Promptly upon the formation of a New Subsidiary (other than an SBIC Subsidiary), the Pledgor shall, in accordance with Section
8.10 of the Credit Agreement, pledge and deliver to the Agent, the certificates representing all of the issued and outstanding
capital stock in such New Subsidiary, which shall thereafter constitute Pledge Equity Interest under the terms of the this Agreement.

 

    	 

    	 

    

 

4.            Cash
Dividends; Cash Distributions; Voting Rights. Unless an Event of Default shall have occurred and be continuing, the Pledgor
shall be entitled to receive all cash dividends and distributions, respectively, paid in respect of the Pledged Equity Interests,
to vote the Pledged Equity Interests and to give consents, waivers and ratifications in respect of the Pledged Equity Interests;
provided, however, that no vote shall be cast or consent, waiver or ratification given or action taken which would
impair the Collateral or the value thereof or be inconsistent with or violate any provision of this Agreement. After an Event
of Default has occurred and while it is continuing, the Agent shall be entitled to receive all cash dividends and distributions
and, in accordance with the irrevocable proxies described in Section 6, to vote the Pledged Equity Interests, and the Pledgor
shall not have or be able to exercise any of such rights.

 

5.            Collateral.
All property at any time pledged with the Agent or the Custodian hereunder for the ratable benefit of the Lenders and all income
therefrom and proceeds thereof, including without limitation the Pledged Equity Interests and the collateral described in Sections
3 and 4 hereof, are herein collectively sometimes referred to as the “Collateral”.

 

6.            Rights
of the Agent. The Agent shall not be liable for failure to collect or realize upon the Secured Obligations or any collateral
security or guarantee therefor, or any part thereof, or for any delay in so doing, nor shall the Agent be under any obligation
to take any action whatsoever with regard thereto. If an Event of Default has occurred and is continuing, any or all of the Collateral
held by the Agent hereunder may, upon notice to the Pledgor and in the Agent’s sole discretion, be registered in the name
of the Agent or its nominee, and the Agent or its nominee may thereafter, without prior notice, exercise all voting and other
rights pertaining to the Collateral at any meeting of any corporation or entity issuing any of the shares or the membership interests
included in the Collateral and exercise any and all rights of conversion, exchange, subscription or any other rights, privileges
or options pertaining to any shares of the Pledged Equity Interests as if the Agent or its nominee were the absolute owner thereof,
including, without limitation, the right to exchange at its discretion, any and all of the Pledged Equity Interests upon the merger,
consolidation, reorganization, recapitalization or other readjustment of any corporation or entity issuing any of such shares
or membership interests or upon the exercise by any such issuer or the Agent of any right, privilege or option pertaining to any
shares or membership interests of the Pledged Equity Interests, and in connection therewith, to deposit and deliver any and all
of the Pledged Equity Interests with any committee, depository, transfer agent, registrar or other designated agency upon such
terms and conditions as it may determine, all without liability except to account for property actually received by it. Notwithstanding
the foregoing, the Agent shall have no duty to exercise any of the aforesaid rights, privileges or options and shall not be responsible
for any failure to do so or delay in so doing. This Agreement constitutes, and the Pledgor hereby grants to the Agent for the
ratable benefit of the Lenders, irrevocable proxies for the Pledged Equity Interests, which may be exercised by the Agent at any
time after the occurrence and during the continuance of an Event of Default under this Agreement.

 

7.            Events
of Default. Each of the following shall constitute an event of default (each an “Event of Default”) under
this Agreement:

 

(a)               
If an Event of Default (as defined therein) shall occur under the Credit Agreement or any of the other Loan Documents;

 

    	 

    	 

    

 

(b)              
If any representation or warranty made by the Pledgor herein proves to have been false or misleading in any material respect
on the date when made; or

 

(c)               
If the Pledgor breaches or fails to perform any of its covenants or agreements set forth in this Agreement and such breach
or failure is not cured and remedied within thirty (30) calendar days after the occurrence of such breach or failure.

 

8.            Remedies.
Upon the occurrence and during the continuance of an Event of Default, the Agent, without demand of performance or other demand,
advertisement or notice of any kind (except the notice specified below of time and place of public or private sale) to or upon
the Pledgor or any other Person (all and each of which demands, advertisements and/or notices are hereby expressly waived), may
forthwith collect, receive, appropriate and realize upon the Collateral, or any part thereof, and/or may forthwith sell, assign,
give option or options to purchase, contract to sell or otherwise dispose of and deliver said Collateral, or any part thereof,
in one or more parcels at public or private sale or sales, at any exchange, broker’s board or at any of the Agent’s
offices or elsewhere upon such terms and conditions as it may deem advisable and at such prices as it may deem best, for cash
or on credit or for future delivery without assumption of any credit risk, with the right of the Agent upon any such sale or sales,
public or private, to purchase the whole or any part of said Collateral so sold, free of any right or equity of redemption in
the Pledgor, which right or equity is hereby expressly waived or released. After deducting all reasonable costs and expenses of
every kind incurred in connection with any collection, recovery, receipt, appropriation, realization or sale (collectively, a
“Sale”) or incidental to the care, safekeeping or otherwise of any and all of the Collateral or in any way
relating to the rights of the Agent hereunder, including reasonable attorneys’ fees and expenses, the Agent shall apply
the net proceeds of such Sale to the payment in full of the Secured Obligations, and only after so paying over such net proceeds
and after the payment by the Agent of any other amount required by any provision of law need the Agent account for the surplus,
if any, to the Pledgor. The Pledgor agrees that the Agent need not give more than ten (10) days’ notice of the time and
place of any public sale or of the time after which a private sale or other intended disposition is to take place and that such
notice is reasonable notification of such matters. In addition to the rights and remedies granted to it in this Agreement and
in any other instrument or agreement securing, evidencing or relating to any of the Secured Obligations, the Agent shall have
all the rights and remedies of a secured party under the UCC. The Pledgor shall be liable for the deficiency if the proceeds of
any sale or other disposition of the Collateral are insufficient to pay the Secured Obligations and all expenses, including, without
limitation, attorneys’ fees and costs, which may be incurred by the Agent in collecting any or all of the Secured Obligations
and enforcing its rights hereunder.

 

    	 

    	 

    

 

9.              Representations,
Warranties and Covenants of the Pledgor. The Pledgor represents and warrants to the Agent and each Lender that: (a) the Pledgor
is the legal record and beneficial owner of, and has good and marketable title to, the Pledged Equity Interests; (b) all of the
Pledged Equity Interests have been duly and validly issued, are fully paid and, in the case of the Pledged Equity Interests consisting
of any stock, non-assessable; (c) there are no outstanding subscriptions, options, warrants, rights, calls, contracts, commitments,
understandings or agreements to purchase or otherwise acquire or relating to the issuance of any shares, other securities, membership
or other ownership or economic interests of the Guarantors; (d) the Pledgor has no Subsidiaries other than the Guarantors and
Art Credit Company, LLC, a Delaware limited liability company, the latter of which is in the process of being dissolved; (e) the
pledge, assignment and delivery of the Pledged Equity Interests pursuant to this Agreement and, if applicable, the Custodian Agreement,
creates a valid first Lien on and a first perfected security interest in the Pledged Equity Interests, and the proceeds thereof,
subject to no prior Lien or to any agreement purporting to grant to any third party a Lien on the property or assets of the Pledgor
which would include the Pledged Equity Interests, assuming the Agent had no notice of an adverse claim prior to the date hereof;
(f) all of the Pledged Equity Interests that are certificated are evidenced by the certificates described on Exhibit A;
(g) the Pledged Equity Interests constitute one hundred (100%) percent of the issued and outstanding shares of capital stock or
membership interests in the Guarantors; (h) all records of the Pledgor relating to the Pledged Equity Interests are located at
its office as listed on page 1 of this Agreement under the custody and control of the Administrator or, subsequent to the execution
and delivery of a Custodian Agreement, the Custodian; (i) the execution, issuance, delivery and performance of this Agreement
by the Pledgor is within the power and authority of the Pledgor and upon its execution and delivery hereof, this Agreement will
be the legal, valid and binding obligation of the Pledgor enforceable against the Pledgor in accordance with its terms and (j)
except for the Pledged Equity Interests and except as otherwise listed on Schedule 9, the Pledgor owns no assets that constitutes
“Investment Property” under the UCC. The Pledgor covenants and agrees that the Pledgor will defend the Agent’s
right, title and security interest in and to the Collateral against the claims and demands of all Persons whomsoever; and covenants
and agrees that the Pledgor will have like title to and right to pledge any other property at any time hereafter pledged to the
Agent as Collateral hereunder and will likewise defend the Agent’s right thereto and security interest therein.

 

10.          No Disposition, etc. The Pledgor shall not sell, assign, transfer, exchange, or otherwise dispose of, or grant any
option with respect to, the Collateral, nor will the Pledgor create, incur or permit to exist any Lien with respect to any of the
Collateral, or any interest therein, or any proceeds thereof, except for the Lien provided for by this Agreement and except for
Permitted Liens. The Pledgor shall not vote to enable any issuer to, and will not otherwise permit any issuer to, issue any stock,
certificates, membership interests or other securities of any nature in addition to or in exchange or substitution for the Pledged
Equity Interests.

 

11.          Registration.

 

(a)               
The Pledgor recognizes that the Agent may be unable to effect a public sale of any or all the Pledged Equity Interests by
reason of certain prohibitions contained in the Securities Act of 1933, as amended (the “Securities Act”), and
applicable state securities laws, but may be compelled to resort to one or more private sales thereof to a restricted group of
purchasers who will be obliged to agree, among other things, to acquire such securities for their own account for investment and
not with a view to the distribution or resale thereof. The Pledgor acknowledges and agrees that any such private sale may result
in prices and other terms less favorable to the seller than if such sale were a public sale. The Agent shall be under no obligation
to delay a sale of any of the Pledged Equity Interests for the period of time necessary to permit any issuer of such securities
to register such securities for public sale under the Securities Act, or under applicable state securities laws, even if such issuer
would agree to do so.

 

(b)              
The Pledgor further agrees to do or cause to be done all such other reasonable acts and things as may be necessary to make
such sale or sales of any portion or all of the Pledged Equity Interests valid and binding and in compliance with any and all applicable
laws, regulations, order, writs, injunctions, decrees or awards of any and all courts, arbitrators or governmental instrumentalities,
domestic or foreign, having jurisdiction over any such sale or sales, all at the Pledgor’s expense, but excluding registration
of the Pledged Equity Interests under the Securities Act. The Pledgor further agrees that a breach of any of the covenants contained
in this Section 11 will cause irreparable injury to the Agent, and the Agent has no adequate remedy at law in respect of
such breach and, as a consequence, agrees that each and every covenant contained in this Section 11 shall be specifically
enforceable against the Pledgor, and the Pledgor hereby waives and agrees not to assert any defenses against an action for specific
performance of such covenants except for a defense that no Event of Default has occurred and is continuing.

 

    	 

    	 

    

 

12.        Further
Assurances; Power of Attorney. At any time and from time to time upon the written request of the Agent, the Pledgor shall
execute and deliver such further documents and do such further acts and things as the Agent may reasonably request in order to
effect the purposes of this Agreement. The Pledgor hereby appoints the Agent or its designee, with full power of substitution,
as the Pledgor’s attorney-in-fact to execute and deliver such documents and to take such actions as the Pledgor is required
by the terms of this Agreement or requested by the Agent to execute and deliver or to take, said power of attorney being coupled
with an interest and therefore irrevocable.

 

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

 

14.        No Waiver; Cumulative Remedies. The Agent shall not by any act, delay, omission or otherwise be deemed to have waived
any of its rights or remedies hereunder, and no waiver shall be valid unless executed and delivered in accordance with the provisions
of Section 15 hereof, and then only to the extent therein set forth. A waiver by the Agent of any right or remedy hereunder
on any one occasion shall not be construed as a bar to any right or remedy which the Agent would otherwise have on any future occasion.
No failure to exercise nor any delay in exercising on the part of the Agent, any right, power or privilege hereunder, shall operate
as a waiver thereof; nor shall any single or partial exercise of any right, power or privilege hereunder preclude any other or
further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein provided are cumulative
and may be exercised singly or concurrently, and are not exclusive of any rights or remedies provided by law.

 

15.        Notices.
All notices and other communications given to or made upon any party hereto in connection with this Agreement shall be delivered
in accordance with the requirements regarding the manner of giving notices under the Credit Agreement and shall be addressed to
such party at the address of such party set forth in the introductory paragraph of this Agreement.

 

16.        Waivers,
Amendments; Successors and Assigns. None of the terms or provisions of this Agreement may be waived, altered, modified, terminated
or amended except by an instrument in writing, duly executed by the Agent. This Agreement and all obligations of the Pledgor hereunder
shall be binding upon the Pledgor and its successors and assigns, and shall inure to the benefit of the Agent and its successors
and assigns.

 

17.        Governing
Law. The validity and interpretation of this Agreement and the rights and obligations of the parties shall be governed by
the laws of the State of New York without regard to its conflict of laws principles.

 

18.        Counterparts. This Agreement may be executed in any number of duplicate originals or counterparts, each of such duplicate
originals or counterparts shall be deemed to be an original and all taken together shall constitute one and the same instrument.

 

    	 

    	 

    

 

19.        Consent to Jurisdiction; Waiver of Jury Trial; Personal Service. AFTER CONSULTATION WITH
COUNSEL, THE PLEDGOR AND (BY ACCEPTING THE PLEDGE HEREUNDER) THE AGENT HEREBY WAIVE THEIR RIGHT TO A TRIAL BY JURY IN CONNECTION
WITH ANY LITIGATION INVOLVING THE SUBJECT MATTER OF THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR ANY COURSE OF CONDUCT,
COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN), OR ACTIONS OF ANY PARTY, AND HEREBY AGREE THAT, IN THE EVENT OF ANY
LITIGATION INVOLVING THE SUBJECT MATTER OF THIS AGREEMENT, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.
SUCH WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR THE AGENT TO ENTER INTO THE CREDIT AGREEMENT AND MAKE THE LOANS CONTEMPLATED
THEREUNDER. THE PLEDGOR AND (BY ACCEPTING THE PLEDGE HEREUNDER) THE AGENT HEREBY CONSENT TO THE JURISDICTION OF THE NEW YORK SUPREME
COURT SITTING IN NEW YORK COUNTY AND ANY UNITED STATES FEDERAL COURT SITTING IN OR WITH DIRECT OR INDIRECT JURISDICTION OVER THE
SOUTHERN DISTRICT OF NEW YORK IN ANY LITIGATION ARISING HEREUNDER, AND IRREVOCABLY WAIVE ALL DEFENSES TO THE PERSONAL JURISDICTION
OF SUCH COURTS, INCLUDING, WITHOUT LIMITATION, DEFENSES BASED UPON THE INCONVENIENCE OF SUCH FORUMS AND HEREBY CONSENT TO THE GRANTING
OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY SUCH COURT. THE PLEDGOR HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS,
COMPLAINT AND OTHER PROCESS ISSUED IN ANY SUCH ACTION OR SUIT AND FURTHER AGREES THAT SERVICE OF ANY SUCH PROCESS MAY BE EFFECTED,
IN ADDITION TO ANY OTHER MEANS PERMITTED BY THE APPLICABLE RULES OF COURT, BY MAILING SUCH PROCESS CERTIFIED MAIL, RETURN RECEIPT
REQUESTED OR BY REPUTABLE OVERNIGHT COURIER PROVIDING A RECEIPT AGAINST DELIVERY TO THE PLEDGOR AS SET FORTH IN SECTION 12.13
OF THE CREDIT AGREEMENT AND THAT SERVICE SO MADE SHALL BE DEEMED COMPLETED UPON THE EARLIER OF THE PLEDGOR’S ACTUAL RECEIPT
THEREOF, THREE (3) BUSINESS DAYS AFTER DEPOSIT IN THE U.S. MAILS, PROPER POSTAGE PREPAID, OR ON THE NEXT BUSINESS DAY FOLLOWING
THE DELIVERY OF SUCH PROCESS BY A REPUTABLE OVERNIGHT COURIER AS AFORESAID. NOTHING IN THIS AGREEMENT SHALL BE DEEMED OR OPERATE
TO AFFECT THE RIGHT OF THE AGENT OR ANY LENDER TO SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED BY LAW, OR TO PRECLUDE THE
ENFORCEMENT BY THE AGENT OR ANY LENDER OF ANY JUDGMENT OR ORDER OBTAINED IN SUCH FORUM OR TAKING OF ANY ACTION UNDER THIS AGREEMENT
TO ENFORCE THE SAME IN ANY OTHER APPROPRIATE FORUM OR JURISDICTION.

 

[Signature page follows]

 

    	 

    	 

    

 

[Signature page to Pledge Agreement]

 

IN WITNESS WHEREOF,
the Pledgor has caused this Pledge Agreement to be duly executed and delivered on the day and year first above written.

 

 

	 	
        FULL CIRCLE CAPITAL CORPORATION

         

         

        By:/s/ John E. Stuart                   

        Name: John E. Stuart

        Title: Chief Executive
        OfficerExhibit 10.3

 

SECURITY
AGREEMENT

 

THIS SECURITY AGREEMENT
(this “Agreement”) dated June 3, 2013, is by FULL CIRCLE CAPITAL CORPORATION,
a Maryland corporation, having an address at 800 Westchester Avenue, Suite S-620, Rye Brook, New York 10573 (the “Borrower”),
in favor of SOVEREIGN BANK, N.A., as agent, having an office at 45 East 53rd Street, New
York, New York 10022 (in such capacity, together with its successors in such capacity, the “Agent”).

 

RECITALS

 

WHEREAS, the Borrower,
certain lenders (the “Lenders”) and the Agent, as agent for the Lenders, entered into a Credit Agreement dated
the date hereof (as the same may be amended hereafter, the “Credit Agreement”) pursuant to which the Lenders
agreed to make certain loans and extend certain credit to the Borrower;

 

WHEREAS, pursuant to
the Credit Agreement, the Borrower is concurrently herewith executing and delivering to the Lenders revolving credit notes in the
maximum aggregate principal amount of $32,500,000 to evidence the revolving loans made or to be made under the Credit Agreement
(as such notes may be amended or replaced from time to time, the “Revolving Notes”); and

 

WHEREAS, in order to
secure all amounts now or hereafter owing by the Borrower under the Credit Agreement, the Revolving Notes and the other Loan Documents,
the Borrower has agreed to grant to the Agent for the ratable benefit of the Lenders a security interest in all of the Collateral
(as such term is defined below), all on the terms and conditions set forth herein.

 

NOW, THEREFORE, in
consideration of the foregoing and the mutual agreements herein contained, and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto do hereby agree as follows:

 

		I.	DEFINITIONS

 

1.1            Defined Terms. Terms used in this Agreement and not otherwise defined shall have the meanings assigned to them in
the Credit Agreement. In addition, the following words and terms shall have the following meanings:

 

“Account Debtor”
shall mean a Person obligated under or with respect to an Account Receivable.

 

“Accounts
Receivable” shall mean, in addition to the definition of the term “accounts” contained in the Code, all Loans
Receivable and all other obligations of any kind at any time due and/or owing to the Borrower (including any such obligation that
might be characterized or classified under the Code as accounts, contract rights, chattel paper or otherwise), and all rights of
the Borrower to receive payment or any other consideration whether arising from goods sold or leased by the Borrower or services
rendered or otherwise, whether or not such right has been earned by performance, whether secured or unsecured, including without
limitation, invoices, contract rights, accounts receivable, notes, drafts, acceptances, instruments, refunds, including tax refunds,
and all other debts, obligations and liabilities in whatever form owing to the Borrower from any person, firm, governmental authority,
corporation or any other entity, all security and guaranties therefor, and all books, records, ledger cards and other tangible
and intangible property pertaining to same (including printed copies of all computerized data, electronic machine-readable media
of such data, and software owned or licensed (to the extent it can be freely assigned) by the Borrower).

 

    	 

    	 

    

  

“Agreement”
shall mean this Security Agreement and all exhibits, schedules, amendments or supplements hereto, together with all modifications
thereto, extensions thereof and substitutions therefor.

 

“Code”
shall mean the Uniform Commercial Code as in effect in any applicable jurisdiction.

 

“Collateral”
shall have the meaning ascribed to such term in Section 2.1 hereof.

 

“Computer
Hardware and Software” shall mean all of the Borrower’s rights (including rights as licensee and lessee) with respect
to (i) computer and other electronic data processing hardware, including all integrated computer systems, central processing units,
memory units, display terminals, printers, computer elements, card readers, tape drives, hard and soft disk drives, cables, electrical
supply hardware, generators, power equalizers, accessories, peripheral devices and other related computer hardware; (ii) all Software
and all software programs designed for use on the computers and electronic data processing hardware described in clause (i) above,
including all operating system software, utilities and application programs in any form (source code and object code in magnetic
tape, disk or hard copy format or any other listings whatsoever); (iii) any firmware associated with any of the foregoing; and
(iv) any documentation for hardware, Software and firmware described in clauses (i), (ii) and (iii) above, including flow charts,
logic diagrams, manuals, specifications, training materials, charts and pseudo codes.

 

“Contracts”
shall mean all contracts, instruments, undertakings, documents or other agreements in or under which the Borrower may now or hereafter
have any right, title or interest, including, without limitation, all loan agreements or credit agreements, contracts, instruments,
undertakings, documents or other agreements relating to an FCC Loan or any other Collateral.

 

“General Intangibles”
shall mean, in addition to the definition of the term “general intangibles” contained in the Code, all general intangibles
now or hereafter owned by the Borrower or in which the Borrower has rights and, in any event, including, without limitation, all
customer lists, mailing lists, prospect lists, partnership interests, Intellectual Property Rights, know-how, engineering labs,
computer software, drawings, rights in proprietary information, permits, and the right to receive any assets distributed upon or
in connection with the termination of any employee benefit plan.

 

    	-2-

    	 

    
 

“Intellectual
Property Rights” shall mean all past, present and future: trade secrets, know-how and other proprietary information;
Trademarks, internet domain names, service marks, trade dress, trade names, business names, designs, logos, slogans (and all translations,
adaptations, derivations and combinations of the foregoing) indicia and other source and/or business identifiers, and the goodwill
of the business relating thereto and all registrations or applications for registrations which have heretofore been or may hereafter
be issued thereon throughout the world; copyrights (including copyrights for computer programs) and copyright registrations or
applications for registrations which have heretofore been or may hereafter be issued throughout the world and all tangible property
embodying the copyrights, unpatented inventions (whether or not patentable); Patent applications and Patents; industrial design
applications and registered industrial designs; license agreements related to any of the foregoing and income therefrom; books,
records, writings, computer tapes or disks, flow diagrams, specification sheets, computer software, source codes, object codes,
executable code, data, databases and other physical manifestations, embodiments or incorporations of any of the foregoing; the
right to sue for all past, present and future infringements of any of the foregoing; all other intellectual property; and all common
law and other rights throughout the world in and to all of the foregoing.

   

“Patents”
shall mean all of the following now or hereafter owned by the Borrower: (i) all patents of the United States or any other country,
and all applications for patents of the United States or any other country; (ii) all renewals, reissues, continuations, divisions,
continuations-in-part or extensions thereof; (iii) any inventions and improvements on existing inventions and any future inventions
and improvements thereon; (iv) all rights to damages or profits due or accrued or arising out of all past, present or future infringements
of any Patent; (v) the right to sue for all past, present and future infringements of any Patent; and (vi) all rights of the Borrower
under any license, royalty, franchise or other agreement relating to any Patent.

 

“Proceeds”
shall mean, in addition to the definition of the term “proceeds” contained in the Code, (i) whatever is received upon
any collection, exchange, sale or other disposition or refinancing of any of the Collateral and any property into which any of
the Collateral is converted, whether cash or non-cash proceeds, (ii) any and all proceeds of any insurance, indemnity, warranty
or guaranty payable to the Borrower from time to time with respect to any of the Collateral, (iii) any and all payments (in any
form whatsoever) made or due and payable to any Borrower from time to time in connection with any requisition, confiscation, condemnation,
seizure or forfeiture of all or any part of the Collateral by any governmental body, authority, bureau or agency (or any Person
acting under color of governmental authority), and (iv) any and all other amounts from time to time paid or payable under or in
connection with any of the Collateral.

 

“Trademarks”
shall mean all of the following now or hereafter owned by the Borrower or under which the Borrower has conducted any business:
(i) all trademarks, trade names, corporate names, company names, division names, business names, fictitious business names, trade
styles, service marks, logos, other source of business identifiers, prints and labels on which any of the foregoing have appeared
or appear, designs and general intangibles of like nature, now existing or hereafter adopted or acquired, all registrations, recordings
and applications in the United States Patent and Trademark Office or in any similar office or agency of the United States, any
state thereof or any other country or any political subdivision thereof; (ii) all reissues, extensions or renewals thereof; (iii)
the goodwill of any business relating to, conducted with or symbolized by any trademark; (iv) all rights to damages or profits
due or accrued or arising out of past, present or future infringements of any trademark or injury to said goodwill; (v) the right
to sue for all past, present and future infringements of any trademark; and (vi) all rights of the Borrower under any license,
royalty, franchise or other agreement relating to any trademark.

 

    	-3-

    	 

    

1.2            The terms “Equipment”, “Inventory”, “Chattel Paper”, “Commercial
Tort Claims”, “Deposit Accounts”, “Payment Intangibles”, “Documents”,
“Financial Assets”, “Fixtures”, “Goods”, “Instruments”,
“Investment Property”, “Letter-of-Credit Rights”, “Certificated Securities”,
“Security Entitlements”, “Software”, “Payment Intangibles” “Uncertificated
Securities” and “Electronic Chattel Paper” shall have the meanings ascribed to them in the Code.

 

1.3            Except as otherwise defined herein, all words and terms defined in the Credit Agreement shall have the same meanings when
used herein.

 

		II.	SECURITY INTEREST

 

2.1            Grant of Security Interest.

 

(a)               
As collateral security for the prompt and complete payment and performance when due (whether at the stated maturity, by
acceleration or otherwise) of all Obligations and in order to induce the Lenders to make the Revolving Loans, the Borrower hereby
mortgages, pledges, hypothecates, transfers and grants to the Agent, for the ratable benefit of the Lenders, a first position security
interest in and lien on all of the Borrower’s right, title and interest in and to the following, in each case whether now
owned or hereafter acquired (all of which being hereinafter collectively called the “Collateral”):

 

(i)             all Accounts Receivable;

 

(ii)            all Contracts (except to the extent granting a security interest in any Contract would cause or result in a breach or violation
of law);

 

(iii)           all Computer Hardware and Software and all rights with respect thereto, including, any and all licenses, options, warranties,
service contracts, program services, test rights, maintenance rights, support rights, improvement rights, renewal rights and indemnifications,
and any substitutions, replacements, additions or model conversions of any of the foregoing;

 

(iv)           all Inventory;

 

(v)            all Equipment;

 

(vi)           all Patents and Trademarks;

 

(vii)          all Chattel Paper;

 

(viii)        
all Commercial Tort Claims;

 

(ix)            all
Deposit Accounts;

 

(x)             all Payment Intangibles;

 

(xi)            all Documents;

 

    	-4-

    	 

    
 

(xii)           all
Goods and all accessions, additions, attachments, improvements, substitutions and replacements thereto and therefor;

 

(xiii)    
     all Instruments;

 

(xiv)     
    all Financial Assets;

 

(xv)          
all Fixtures;

 

(xvi)      
   all General Intangibles, including Payment Intangibles and Software;

 

(xvii)      
  all Letter-of-Credit Rights;

 

(xviii)    
   all Certificated Securities and all Uncertificated Securities (except with respect to any SBIC
Subsidiary);

 

(xix)        
  all Security Entitlements (except with respect to any SBIC Subsidiary);

 

(xx)     
      all Investment Property;

 

(xxi)    
      the Collateral Proceeds Account;

 

(xxii)    
    any and all moneys, securities, drafts, notes, and other property of any kind of the Borrower, now
or hereafter held or received by or in transit to the Agent or any Lender from or for the Borrower (including, without
limitation, all moneys held or deposited in the Collateral Proceeds Account or any lockbox maintained by or on behalf of the
Agent or any Lender), or which may now or hereafter be in the possession of the Agent or any Lender, or as to which the Agent
or any Lender may now or hereafter be in the control or possession of, by documents of title or otherwise, whether for
safekeeping, custody, pledge, transmission, collection or otherwise, and any and all deposits, general or special, balances,
sums, proceeds and credits of the Borrower, and all rights and remedies which the Borrower might exercise with respect to any
of the foregoing but for this Agreement;

 

(xxiii)   
    to the extent not otherwise included in the foregoing, all other personal property of the Borrower, whether tangible or
intangible, whether now owned or hereafter acquired and wherever located; and

 

(xxiv)       
all Proceeds of the foregoing.

 

(b)              
All Collateral heretofore, herein or hereafter given or granted to the Agent by the Borrower shall secure payment of all
of the Obligations. The Agent shall be under no obligation to proceed against any or all of the Collateral before proceeding directly
against the Borrower. It is expressly agreed by the Borrower that, anything herein to the contrary notwithstanding, the Borrower
shall remain liable under each Contract to observe and perform all the conditions and obligations to be observed and performed
by it thereunder, all in accordance with and pursuant to the terms and provisions of each Contract. Neither the Agent nor any Lender
shall have any obligation or liability under any such Contract by reason of or arising out of this Agreement or the receipt by
the Agent or any Lender of any payment relating to any Contract pursuant hereto, nor shall any such party be required or obligated
in any manner to perform or fulfill any of the obligations of the Borrower under or pursuant to any Contract, or to make any payment,
or to make any inquiry as to the nature or the sufficiency of any payment received by it or the sufficiency of any performance
by any party under any Contract, or to present or file any claim, or to take any action to collect or enforce any performance or
the payment of any amounts which may have been assigned to it or to which it may be entitled at any time or times.

 

    	-5-

    	 

    

 

 

(c)               
In addition to the security interest of the Agent in the Collateral as herein provided, all of the Obligations shall be
secured by the other Loan Documents.

 

(d)              
The Agent shall have the right to make test verifications of the Accounts Receivable in any manner and through any medium
that it considers advisable, and the Borrower agrees to pay to the Agent for its own account the reasonable costs thereof and to
furnish all such assistance and information as the Agent may require in connection therewith.

 

(e)               
In the event that any of the Collateral consists of chattel paper, notes and other instruments and negotiable documents,
the Borrower shall promptly endorse and deliver the same to the Agent or a Custodian for the ratable account of the Lenders.

 

2.2            Commercial Tort Claims. The Borrower shall promptly notify the Agent in writing upon incurring or otherwise obtaining
a Commercial Tort Claim against any third party and, upon request of the Agent, promptly enter into an amendment to this Agreement
and do such other acts or things deemed appropriate by the Agent to grant the Agent, for the ratable benefit of the Lenders, a
perfected security interest in any such Commercial Tort Claim.

 

2.3            Other Collateral. The Borrower shall promptly notify the Agent in writing upon acquiring or otherwise obtaining any
Collateral after the date hereof consisting of Deposit Accounts, Investment Property, Letter-of-Credit Rights or Electronic Chattel
Paper and, upon the request of the Agent, promptly execute such other documents, and do such other acts or things deemed appropriate
by the Agent to deliver to the Agent control with respect to such Collateral. Further, the Borrower shall promptly notify the Agent
in writing upon acquiring or otherwise obtaining any Collateral after the date hereof consisting of Documents or Instruments and,
upon the request of the Agent, promptly execute such other documents, and do such other acts or things deemed appropriate by the
Agent to deliver to the Agent or a Custodian possession of such Documents which are negotiable and possession of the Instruments,
and, with respect to nonnegotiable Documents, to have such nonnegotiable Documents issued or endorsed in the name of the Agent
or a Custodian. In the event any of the Collateral is in the possession of a third party, other than Certificated Securities and
Goods covered by a Document, the Borrower shall promptly obtain a written acknowledgement from the third party that it is holding
the Collateral for the benefit of the Agent.

 

    	-6-

    	 

    
 

2.4           Lien Perfection; Further Assurances. The Borrower irrevocably authorizes the Agent to prepare and file UCC-1 financing
statements as are required by the Code (or otherwise deemed advisable by the Agent) and such other instruments, assignments or
documents as are necessary to perfect the Agent’s Lien upon any of the Collateral and shall take such other action as may
be required to perfect or to continue the perfection of the Agent’s Lien upon the Collateral. The Borrower further irrevocably
authorizes the Agent to prepare and file such UCC-3 continuation statements and initial financing statements in-lieu of continuation
statements as the Agent deems necessary or desirable in connection therewith. Unless prohibited by applicable law, the Borrower
hereby irrevocably authorizes the Agent to prepare and file any such financing statements, including, without limitation, financing
statements that indicate the Collateral (i) as all assets of the Borrower or words of similar effect, or (ii) as being of an equal
or lesser scope, or with greater or lesser detail, than as set forth in this Article II, on the Borrower’s behalf.
The Borrower also hereby ratifies its authorization for the Agent to have filed in any jurisdiction any like financing statements
or amendments thereto if filed prior to the date hereof. The parties agree that a photographic or other reproduction of this Agreement
shall be sufficient as a financing statement and may be filed in any appropriate office in lieu thereof. At the Agent’s request,
the Borrower shall also promptly execute or cause to be executed and shall deliver to the Agent any and all documents, instruments
and agreements deemed necessary by the Agent to give effect to or carry out the terms or intent of this Agreement or any of the
other Loan Documents.

   

		III.	REPRESENTATIONS AND WARRANTIES.

 

3.             In order to induce the Agent and the Lenders to enter into the Credit Agreement and the Lenders to make the Revolving Loans,
the Borrower hereby represents, warrants and agrees that, for so long as any Obligation is outstanding or the Lenders have any
obligation to make Revolving Loans to the Borrower, the following are, and shall continue to be, true, complete and correct:

 

3.1           Collateral.

 

(a)               
Except as set forth on Schedule 7.1 of the Credit Agreement, the Borrower does not currently conduct, nor within
five years prior to the date hereof has it conducted, business under any other or alternate or fictitious name.

 

(b)              
The Borrower is (or, in the case of after acquired property, will be) the sole owner of each item of Collateral and has
good and marketable title thereto, free and clear of any and all Liens except for Permitted Liens.

 

(c)              
No security agreement, financing statement, mortgage, deed of trust, equivalent security or lien instrument or continuation
statement covering all or any part of the Collateral is or will be on file or of record in any public office other than in favor
of the Agent or as disclosed on Schedule 7.8 to the Credit Agreement.

 

(d)              
This Agreement constitutes a valid and continuing first lien on and security interest in the Collateral in favor of the
Agent (for the ratable benefit of the Lenders), prior to all other liens, encumbrances, security interests and rights of others,
except for those instances in which a Permitted Lien would have priority, and is enforceable as such or against creditors of, and
purchasers from, the Borrower. All action necessary or desirable to protect and perfect such security interest in each item of
Collateral has been taken or will be taken concurrently herewith.

 

    	-7-

    	 

    
 

(e)               
Schedule 7.15 to the Credit Agreement sets forth the Borrower’s principal place of business which is the location
where all records regarding the Collateral are kept.

 

3.2            Accuracy and Completeness of Information. All information, reports and other papers and data furnished to the Agent
in connection with each Revolving Loan is, and will be, at the time the same are so furnished, complete and correct in all material
respects. No document furnished or statement now or hereafter made to the Agent in connection with the making of any Revolving
Loan contains or will contain any untrue statement of fact or omits or will omit to state a material fact necessary in order to
make the statements contained therein not misleading.

 

		IV.	COVENANTS

 

4.              The Borrower covenants and agrees that until all the Obligations have been satisfied and paid in full and the Lenders have
no further obligation to make any Revolving Loan, the Borrower will comply with the following covenants:

  

4.1            Insurance. The Borrower shall give the Agent prompt notice of any and all insurance claims made by the Borrower with
respect to the Collateral.

 

4.2            Liens. The Borrower will not create, assume or incur or cause to be created, assumed or incurred, or permit to exist,
any Liens on the Collateral except for Permitted Liens, and the Borrower will defend the right, title and interest of the Agent
in and to all of the Borrower’s rights to the Collateral and in and to the Proceeds thereof against the claims and demands
of all Persons whomsoever.

 

4.3            Collateral.

 

(a)               
The Borrower will furnish to the Agent, from time to time, statements and schedules further identifying and describing the
Collateral and such other reports in connection with the Collateral as the Agent may request, all in reasonable detail.

 

(b)              
The Borrower will immediately advise the Agent, in complete detail, (i) of any Lien asserted or claim made against any of
the Collateral, (ii) of any material change in the composition of the Collateral and (iii) of the occurrence of any other event
which would have a material effect on the value of the Collateral or on the security interest created hereunder.

 

(c)               
In the event the Collateral shall be located upon premises which (i) are leased by the Borrower from a third party or (ii)
are owned by the Borrower but encumbered by a mortgage, deed of trust or similar instrument in favor of any third party (other
than the Agent), the Borrower shall, upon the Agent’s request, deliver to the Agent such waivers, disclaimers and rights
of entry and removal as the Agent may request in order to protect and perfect the security interest granted to the Agent herein
and the rights and remedies associated therewith.

 

    	-8-

    	 

    
 

4.4            Further Documentation. At any time and from time to time upon the Agent’s request and at the Borrower’s
expense, the Borrower will promptly and duly execute and deliver such further documents and instruments and do such further acts
and things as the Agent may reasonably request in order to obtain the full benefits of this Agreement and the other Loan Documents
and the rights and powers herein and therein granted, including the filing of any financing or continuation statements and amendments
thereto under the Code in effect in any jurisdiction and any and all other recording documents with respect to the Liens and security
interests granted to the Agent pursuant to the Loan Documents.

 

4.5            Agent’s Appointment as Attorney-in-Fact.

 

(a)               
The Borrower hereby irrevocably constitutes and appoints the Agent, and any officer or agent thereof, with full power of
substitution, as its true and lawful attorney-in-fact with full irrevocable power and authority in the place and stead of the Borrower
and in the name of the Borrower or in its own name, from time to time in the Agent’s discretion following the occurrence
and during the continuance of an Event of Default, for the purpose of carrying out the terms of this Agreement, to take any and
all appropriate action and to execute any and all documents and instruments which may be necessary or desirable to accomplish the
purposes of this Agreement and, without limiting the generality of the foregoing, hereby gives the Agent the power and right, on
behalf of the Borrower without notice to or assent by the Borrower, to do the following:

  

(i)                
upon the occurrence and during the continuance of an Event of Default, to ask, demand, collect, receive and give acquittances
and receipts for any and all moneys due or to become due under or in connection with any Collateral, including, without limitation,
any Loan Receivable; and

 

(ii)              
upon the occurrence and during the continuance of an Event of Default (A) to direct any FCC Borrower or any other party
liable for any payment due the Borrower with respect to any of the Collateral to make payment of any and all moneys due and to
become due thereunder directly to the Agent or as the Agent shall direct; (B) to receive payment of and receipt for any and all
moneys, claims and other amounts due and to become due at any time in respect of or arising out of any Collateral, including, without
limitation, any Loan Receivable; (C) to sign and indorse any invoices, storage or warehouse receipts, drafts against debtors, assignments,
verifications and notices in connection with accounts and other documents relating to the Collateral; (D) to commence and prosecute
any suits, actions or proceedings at law or in equity in any court of competent jurisdiction to collect the Collateral (including,
without limitation, any Loan Receivable) or any part thereof and to enforce any other right in respect of any Collateral; (E) to
defend any suit, action or proceeding brought against the Borrower with respect to any Collateral (including, without limitation,
any Loan Receivable); (F) to settle, compromise or adjust any suit, action or proceeding described above and, in connection therewith,
to give such discharges or releases as the Agent may deem appropriate; and (G) generally to sell, transfer, pledge, make any agreement
with respect to or otherwise deal with any of the Collateral as fully and completely as though the Agent were the absolute owner
thereof for all purposes, and to do, at the Agent’s option and the Borrower’s expense, at any time or from time to
time, all acts and things which the Agent deems necessary to protect, preserve or realize upon the Collateral and the Agent’s
security interest therein, in order to effect the intent of this Agreement, all as fully and effectively as the Borrower might
do.

 

    	-9-

    	 

    
 

(b)              
The Borrower hereby ratifies all that said attorneys shall lawfully do or cause to be done by virtue hereof. This power
of attorney is a power coupled with an interest and shall be irrevocable.

 

(c)               
The powers conferred on the Agent hereunder are solely to protect the interests of the Agent in the Collateral and shall
not impose any duty upon it to exercise any such powers. The Agent shall be accountable only for amounts that it actually receives
as a result of the exercise of such powers, and neither it nor any of its officers, employees or agents shall be responsible to
the Borrower for any act or failure to act, except for its gross negligence or willful misconduct.

 

(d)              
The Borrower also authorizes the Agent at any time and from time to time following the occurrence and during the continuance
of an Event of Default to execute any endorsements, assignments or other instruments of conveyance or transfer with respect to
the Collateral.

  

4.6            Performance by Agent of Borrower’s Obligations. If the Borrower fails to perform or comply with any of its
agreements contained herein or in the Credit Agreement, and the Agent shall perform or comply, or otherwise cause performance or
compliance, with such agreement, the expenses of the Agent incurred in connection with such performance or compliance, together
with interest thereon at the Default Rate, shall be payable by the Borrower to the Agent on demand and shall constitute Obligations
secured hereby. The Borrower hereby irrevocably constitutes and appoints the Agent, and any officer or agent thereof, with full
power of substitution, as its true and lawful attorney-in-fact with full power and authority in the place and stead of the Borrower
and in the name of the Borrower or in its own name, from time to time in the Agent’s discretion, to perform or comply with
any and all of the Borrower’s obligations hereunder which the Borrower has failed to perform or comply with after notice
thereof and to take any and all other actions necessary or advisable in the Agent’s judgment, to protect, preserve, enforce
or exercise the Agent’s rights under this Agreement or the other Loan Documents, said power being coupled with an interest
and therefore irrevocable.

 

		V.	EVENTS OF DEFAULT

 

5.              Each of the following shall constitute an Event of Default (provided that any requirement for notice or lapse of time or
any grace or cure period or other condition has been satisfied), whatever the reason for such event and whether it shall be voluntary
or involuntary or be effected by operation of law or pursuant to any judgment or order of any court or any order, rule or regulation
of any governmental body:

 

5.1            If any warranty or representation made by or on behalf of the Borrower contained herein or in any of the Loan Documents
or in any document furnished in compliance or connection with the Loan Documents is false or incorrect in any material respect
when made.

 

5.2            If the Borrower shall default in the performance or observance of any covenant or agreement contained in this Agreement
and such default shall continue unremedied for thirty (30) days after the earlier of (i) an Authorized Officer becomes aware of
such breach, or (ii) notice thereof from the Agent.

 

    	-10-

    	 

    
 

5.3            If any Event of Default (as defined in each such instrument or document) shall occur under the Revolving Notes, the Credit
Agreement or any of the other Loan Documents.

 

		VI.	REMEDIES

 

6.1            Upon the occurrence of any Event of Default:

 

(a)               
All payments received by the Borrower under or in connection with any of the Collateral (including, without limitation,
the Loans Receivable) shall be held by the Borrower in trust for the Agent, and shall forthwith upon receipt by the Borrower be
turned over to the Agent, in the same form as received by the Borrower (duly indorsed by the Borrower to the Agent, if required);
and

 

(b)              
Any and all such payments so received by the Agent (whether from the Borrower or otherwise) may, in the sole discretion
of the Agent, be held by the Agent as collateral security for, and/or then or at any time thereafter applied in whole or in part
by the Agent against, all or any part of the Obligations in such order as the Agent shall determine in its sole discretion. Any
balance of such payments held by the Agent and remaining after payment in full of all such Obligations shall be paid over to the
Borrower.

 

6.2            If any Event of Default shall occur, the Agent may exercise, in addition to all other rights and remedies granted to it
in this Agreement and in any other Loan Document, all rights and remedies of a secured party under the Code. Without limiting the
generality of the foregoing, the Agent may, without any requirement of notice, setoff any and all amounts owing by the Borrower
to it against any Deposit Account maintained in the Agent by the Borrower or any other property of the Borrower which may now or
hereafter be in the Agent’s possession or control, and such right of setoff shall be deemed to have been exercised immediately
upon such stated or accelerated maturity as aforesaid even though such setoff is not noted on the Agent’s records until a
later time. Without limiting the generality of the foregoing, the Borrower expressly agrees that in any such event the Agent, without
demand of performance or other demand, advertisement or notice of any kind (except any notice provisions otherwise contained in
this Agreement and the notice specified below of time and place of public or private sale) to or upon the Borrower or any other
Person (all and each of which demands, advertisements and/or notices are hereby expressly waived), may forthwith collect, receive,
appropriate and realize upon the Collateral, or any part thereof, and/or may forthwith sell, lease, assign, give option or options
to purchase, or sell or otherwise dispose of and deliver the Collateral (or contract to do so), or any part thereof, in one or
more parcels at public or private sale or sales, at any exchange, broker’s board or at any of the Agent’s offices or
elsewhere at such prices as it may deem best, for cash or on credit or for future delivery without assumption of any credit risk.
The Agent shall have the right upon any such public sale or sales, and, to the extent permitted by law, upon any such private sale
or sales, to purchase the whole or any part of the Collateral so sold, free of any right or equity of redemption in the Borrower
which shall be released. The Borrower further agrees, at the Agent’s request, to assemble (or cause its agents to assemble)
the Collateral and make it available to the Agent at places which the Agent shall reasonably select, whether at the Borrower’s
premises or elsewhere. The Agent shall apply the net proceeds of any such collection, recovery, receipt, appropriation, realization
or sale, after deducting all reasonable costs and expenses of every kind incurred therein or incidental to the care, safekeeping
or 

 

    	-11-

    	 

    

otherwise of any or all of the Collateral or in any way relating to the rights of the Agent hereunder, including reasonable attorneys’
fees and legal expenses, to payment in whole or in part of the Obligations, in the manner provided in the Credit Agreement, the
Borrower remaining liable for any deficiency remaining unpaid after such application, and only after paying over such net proceeds
and after the payment by the Agent of any other amount required by any provision of law, need the Agent account for the surplus,
if any, to the Borrower. To the extent permitted by applicable law, the Borrower waives all claims, damages, and demands against
the Agent arising out of the repossession, retention or sale of the Collateral. Subject to the notice provisions otherwise contained
in this Agreement, the Borrower agrees that the Agent need not give more than 10 days’ notice (which notification shall
be deemed given, when mailed, postage prepaid, addressed to the Borrower at its address set forth in Section 8.2 hereof)
of the time and place of any public sale or of the time after which a private sale may take place and that such notice is reasonable
notification of such matters. The Borrower shall remain liable for any deficiency if the proceeds of any sale or disposition of
the Collateral are insufficient to pay all amounts to which the Agent is entitled, the Borrower also being liable for the reasonable
fees of any attorneys employed by the Agent to collect such deficiency.

 

6.3            The Borrower also agrees to pay all costs and expenses (including reasonable attorneys’ fees) incurred by the Agent
with respect to the collection of any of the Obligations and the enforcement of any of the Agent’s rights hereunder.

 

6.4            The Borrower hereby waives (i) presentment, demand, protest or any notice (to the extent permitted by applicable law) of
any kind in connection with this Agreement or any Collateral, except as otherwise provided herein, (ii) all rights to seek from
any court any bond or security prior to the exercise by the Agent of any remedy described herein, (iii) the benefit of all valuation,
appraisement and exemption laws, and (iv) all rights to demand or to have any marshalling of assets upon any power of sale granted
herein or pursuant to judicial proceedings or upon any foreclosure or any enforcement of this Agreement or any other Loan Document.

 

6.5            Without limiting the generality of any of the rights and remedies conferred upon the Agent in this Agreement, the Agent
may, after the occurrence of an Event of Default and to the full extent permitted by applicable law: (i) take immediate possession
of the Collateral, either personally or by means of a receiver appointed by a court of competent jurisdiction; (ii) at the Agent’s
option, use, operate, manage and control the Collateral in any lawful manner; (iii) collect and receive all rents, income, revenue,
earnings, issues and profits therefrom; and (iv) maintain, repair, renovate, alter or remove the Collateral as the Agent may determine
in its sole discretion or any Loan Document.

 

		VII.	INDEMNIFICATION

 

7.1            Indemnification. The Borrower agrees to pay, reimburse, indemnify and hold harmless, the Agent, the Lenders and their
Affiliates and Subsidiaries and each of their respective directors, officers, employees, agents and representatives from and against
any and all actions, costs, damages, disbursements, expenses (including reasonable attorneys’ fees), judgments, liabilities,
losses, obligations, penalties and suits of any kind or nature whatsoever with respect to (except in the case of gross negligence
or willful misconduct of any such party):

 

    	-12-

    	 

    
 

(a)               
the exercise of any right or remedy granted herein, the collection or enforcement of any of the Obligations and the proof
or allowability of any claim arising with respect to the Collateral, whether in any bankruptcy or receivership proceeding or otherwise;

 

(b)              
any claim of third parties, and the prosecution or defense thereof, arising out of or in any way connected with any of the
Collateral; and

 

(c)               
any and all recording and filing fees and taxes, and any and all liabilities with respect thereto, or resulting from any
delay in paying stamp and other taxes, if any, which may be payable or determined to be payable in connection with the Collateral.

  

		VIII.	MISCELLANEOUS

 

8.1            Reasonable Care. The Agent shall have no duty with respect to the care and preservation of the Collateral beyond
the exercise of reasonable care. The Agent shall be deemed to have exercised reasonable care in the custody and preservation of
the Collateral in its possession if the Collateral is accorded treatment substantially equal to that which the Agent accords its
own property, it being understood that the Agent shall not have any responsibility for (a) ascertaining or taking action with respect
to any claims, the nature or sufficiency of any payment or performance by any party under or pursuant to any agreement relating
to the Collateral or other matters relative to any Collateral, whether or not the Agent has or is deemed to have knowledge of such
matters, or (b) taking any necessary steps to preserve rights against any parties with respect to any Collateral. Nothing set forth
in this Agreement, nor the exercise by the Agent of any of the rights and remedies hereunder, shall relieve the Borrower from the
performance of any obligation on the Borrower’s part to be performed or observed in respect of any of the Collateral.

 

8.2            Notice. All notices and other communications given to or made upon any party hereto in connection with this Agreement
shall be delivered in accordance with the provisions of, and addressed to the respective parties hereto as set forth in, Section
12.13 of the Credit Agreement, except as otherwise set forth in Section 8.10 hereof.

 

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

 

8.4            Survival of Agreements. All agreements, representations and warranties made herein, and in any certificates delivered
pursuant hereto shall survive the execution and delivery of this Agreement and the Notes and the making of any advances under the
Revolving Notes.

 

8.5            Amendment. No modification, amendment or waiver of any provision of this Agreement, nor consent to any departure
by the Borrower shall in any event be effective unless the same shall be in writing and signed by the party granting such modification,
amendment or waiver, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which
given.

 

    	-13-

    	 

    
 

8.6            Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the Borrower, the Agent,
all future holders of the Revolving Notes and their respective successors and assigns, except that the Borrower may not assign
or transfer any of its rights under this Agreement without the prior written consent of the Agent.

 

8.7            Severability. In case any one or more of the provisions contained in this Agreement should be invalid, illegal or
unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein and therein
shall not in any way be affected or impaired thereby.

  

8.8            Counterparts. This Agreement may be executed by the parties hereto on any number of separate counterparts and all
such counterparts taken together shall constitute one and the same instrument.

 

8.9            Governing Law; No Third Party Rights. This Agreement and the rights and obligations of the parties hereunder shall
be governed by and construed and interpreted in accordance with the law of the State of New York without regard to its conflict
of laws principles. This Agreement is solely for the benefit of the parties hereto and their respective successors and assigns,
and no other person shall have any right, benefit, priority or interest in, under or because of the existence of, this Agreement.

 

8.10         
Consent to Jurisdiction; Waiver of Jury Trial; Personal Service. AFTER CONSULTATION WITH
COUNSEL, THE BORROWER AND THE AGENT HEREBY WAIVE THEIR RIGHT TO A TRIAL BY JURY IN CONNECTION WITH ANY LITIGATION INVOLVING THE
SUBJECT MATTER OF THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER
VERBAL OR WRITTEN), OR ACTIONS OF ANY PARTY, AND HEREBY AGREE THAT, IN THE EVENT OF ANY LITIGATION INVOLVING THE SUBJECT MATTER
OF THIS AGREEMENT, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT. SUCH WAIVER CONSTITUTES A MATERIAL
INDUCEMENT FOR THE LENDERS AND THE AGENT TO ENTER INTO THIS AGREEMENT AND MAKE THE LOANS CONTEMPLATED BY THE CREDIT AGREEMENT.
THE BORROWER AND THE AGENT HEREBY CONSENT TO THE JURISDICTION OF THE NEW YORK SUPREME COURT SITTING IN NEW YORK COUNTY AND ANY
UNITED STATES FEDERAL COURT SITTING IN OR WITH DIRECT OR INDIRECT JURISDICTION OVER THE SOUTHERN DISTRICT OF NEW YORK IN ANY LITIGATION
ARISING HEREUNDER, AND IRREVOCABLY WAIVE ALL DEFENSES TO THE PERSONAL JURISDICTION OF SUCH COURTS, INCLUDING, WITHOUT LIMITATION,
DEFENSES BASED UPON THE INCONVENIENCE OF SUCH FORUMS AND HEREBY CONSENT TO THE GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS
DEEMED APPROPRIATE BY SUCH COURT. THE BORROWER HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND OTHER PROCESS ISSUED
IN ANY SUCH ACTION OR SUIT AND FURTHER AGREES THAT SERVICE OF ANY SUCH PROCESS MAY BE EFFECTED, IN ADDITION TO ANY OTHER MEANS
PERMITTED BY THE APPLICABLE RULES OF COURT, BY MAILING SUCH PROCESS CERTIFIED MAIL, RETURN RECEIPT REQUESTED OR BY REPUTABLE OVERNIGHT
COURIER PROVIDING A RECEIPT 

 

    	-14-

    	 

    

AGAINST DELIVERY TO THE BORROWER AS SET FORTH IN SECTION 12.13 OF THE CREDIT AGREEMENT AND THAT
SERVICE SO MADE SHALL BE DEEMED COMPLETED UPON THE EARLIER OF THE BORROWER’S ACTUAL RECEIPT THEREOF, THREE (3) BUSINESS
DAYS AFTER DEPOSIT IN THE U.S. MAILS, PROPER POSTAGE PREPAID, OR ON THE NEXT BUSINESS DAY FOLLOWING THE DELIVERY OF SUCH PROCESS
BY A REPUTABLE OVERNIGHT COURIER AS AFORESAID. NOTHING IN THIS AGREEMENT SHALL BE DEEMED OR OPERATE TO AFFECT THE RIGHT OF THE
AGENT OR ANY LENDER TO SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED BY LAW, OR TO PRECLUDE THE ENFORCEMENT BY THE AGENT OR
ANY LENDER OF ANY JUDGMENT OR ORDER OBTAINED IN SUCH FORUM OR TAKING OF ANY ACTION UNDER THIS AGREEMENT TO ENFORCE THE SAME IN
ANY OTHER APPROPRIATE FORUM OR JURISDICTION.

 

 

[Signature page follows]

    	-15-

    	 

    

 

[Signature page to Security Agreement]

 

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

 

	 	
        BORROWER:

         

        FULL CIRCLE CAPITAL CORPORATION

         

         

        By:___/s/ John E. Stuart____________________

        Name: John E. Stuart

        Title: Chief Executive
        Officer

         

         

         

	 	
        AGENT:

         

        SOVEREIGN BANK, N.A., as
        Agent

         

         

        By:______/s/ Joseph Accardi________________

        Joseph Accardi, Senior
        Vice President

         

         

 

 

    	-16-

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