Document:

Exhibit 4.9

 

	 

 

ASSET PURCHASE AGREEMENT

 

Dated as of _______ __, 2016

 

between

 

MANHATTAN BRIDGE CAPITAL, INC.

as Seller

 

and

 

MBC FUNDING II CORP.

as Buyer

  

 

	 

 

     

     

    

 

ASSET PURCHASE AGREEMENT

 

This ASSET PURCHASE
AGREEMENT (this “Agreement”), dated as of _____ __, 2016, between MBC FUNDING II CORP. (“Buyer”)
and MANHATTAN BRIDGE CAPITAL, INC. (“Seller”).

 

WITNESSETH:

 

WHEREAS, Seller
wishes to sell to Buyer, and Buyer wishes to purchase from Seller, the Purchased Assets (as more particularly described herein)
on the terms and subject to the conditions set forth in this Agreement.

 

NOW, THEREFORE,
in consideration of the mutual covenants and agreements hereinafter set forth, the parties to this Agreement agree as follows:

 

ARTICLE
I

DEFINITIONS AND INTERPRETATIONS

 

1.1           Definitions.
In this Agreement, the following terms have the meanings specified or referred to in this Section 1.1 and shall be equally applicable
to both the singular and plural forms.

 

“Business
Day” means a day other than a Saturday, Sunday or other day on which commercial banks in New York City are authorized
or required by law to close.

 

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

 

“Court Order”
means any judgment, order, decree, award, ruling, decision, verdict, subpoena, injunction or settlement entered, issued, made or
rendered by, or any consent agreement, memorandum of understanding or other Contract with, any Governmental Body (in each case
whether temporary, preliminary or permanent), or non-U.S., court or tribunal and any award in any arbitration proceeding.

 

“Encumbrance”
means any lien (statutory or other), claim, charge, security interest, mortgage, deed of trust, pledge, hypothecation, assignment,
conditional sale or other title retention agreement, preference, priority or other security agreement or preferential arrangement
of any kind, and, with respect to any real property included in the Purchased Assets (if any), any easement, encroachment, covenant,
restriction, right of way, defect in title or other encumbrance of any kind.

 

“Environmental
Laws” means any and all local, state, federal or other governmental authority, statute, ordinance, code, order, decree,
law, rule or regulation pertaining to or imposing liability or standards of conduct concerning environmental regulation, contamination
or clean-up including, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act, as amended,
the Resource Conservation and Recovery Act, as amended, the Emergency Planning and Community Right-to-Know Act of 1986, as amended,
the Hazardous Substances Transportation Act, as amended, the Solid Waste Disposal Act, as amended, the Clean Water Act, as amended,
the Clean Air Act, as amended, the Toxic Substance Control Act, as amended, the Safe Drinking Water Act, as amended, the Occupational
Safety and Health Act, as amended, any state super-lien and environmental statutes and all rules and regulations adopted in respect
to the foregoing laws whether presently in force or coming into being and/or effectiveness hereafter.

 

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“ERISA”
means the Employee Retirement Income Security Act of 1974, as amended.

 

“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

 

“Governmental
Body” means any United States federal, state or local, or any supra national or non U.S., government, political subdivision,
governmental, regulatory or administrative authority, instrumentality, agency body or commission, self-regulatory organization,
court, tribunal or judicial or arbitral body.

 

“Hazardous
Substances”: Any hazardous and/or toxic, dangerous and/or regulated, substances, wastes, materials, raw materials
which include hazardous constituents, pollutants or contaminants including without limitation, petroleum, tremolite, anthlophylie,
actinolite or polychlorinated biphenyls and any other substances or materials which are included under or regulated by Environmental
Laws or which are considered by scientific opinion to be otherwise dangerous in terms of the health, safety and welfare of humans.

 

“Indenture”
means the Indenture, dated as of the date hereof, among Buyer, Seller and Indenture Trustee, as from time to time amended, restated,
supplemented or otherwise modified.

 

“Indenture
Trustee” means Worldwide Stock Transfer, LLC, in its capacity as trustee under the Indenture, or its successor in
interest, or any successor trustee appointed as provided in the Indenture.

 

“Knowledge
of Seller” means the actual knowledge, or the knowledge that such Person would have had if such Person had conducted
a reasonable inquiry with respect to the subject matter thereof, of any of the following individuals: Assaf Ran and Vanessa Kao.

 

“Liabilities”
means any liabilities, claims or obligations, direct or indirect, known or unknown, absolute or contingent.

 

“Mortgagor
Customer” means, with respect to each Mortgage Loan, the obligor on the related Mortgage Note.

 

“Mortgage
Loan” means a mortgage loan provided to a Mortgagor Customer and which mortgage loan includes, without limitation,
(a) a Mortgage Note, the related Mortgage and all other Mortgage Loan Documents and (b) all right, title and interest of Seller
in and to the Mortgaged Property covered by such Mortgage.

 

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“Mortgage
Loan Assets” means all of Seller’s right, title and interest in, to and under each of the following items of
property, whether now owned or hereafter acquired, now existing or hereafter created and wherever located:

 

(a)          all
Mortgage Loans;

 

(b)          all
Mortgage Loan Documents, including without limitation all Mortgage Notes and any collateral pledged or otherwise relating to such
Mortgage Loans, together with all files, documents, instruments, surveys, certificates, correspondence, appraisals, computer programs,
computer storage media, accounting records and other books and records relating thereto;

 

(c)          all
mortgage guaranties and insurance (issued by governmental agencies or otherwise) and any mortgage insurance certificate or other
document evidencing such mortgage guaranties or insurance relating to any Mortgage Loan and all claims and payments thereunder;

 

(d)          all
other insurance policies and insurance proceeds relating to any Mortgage Loan or the related Mortgaged Property;

 

(e)          all
“general intangibles”, “accounts” and “chattel paper” as defined in the UCC relating to or
constituting any and all of the foregoing; and

 

(f)          any
and all replacements, substitutions, distributions on or proceeds of any and all of the foregoing.

 

“Mortgage
Loan Documents” means, with respect to a Mortgage Loan, the documents comprising the Mortgage Loan File for such
Mortgage Loan.

 

“Mortgage
Loan File” means, for any Mortgage Loan, (a) the original Mortgage Note bearing all intervening endorsements, duly
endorsed to Buyer, (b) the original Mortgage(s) securing each Mortgage Note with evidence of recording thereon or copies certified
by the related recording office, (c) the Mortgage Loans Assignment, if any, executed in connection with such Mortgage(s), (d) any
original stock certificates (accompanied by applicable stock powers), instruments, chattel paper or other collateral securing any
Mortgage Loan in which the perfection of Seller’s lien is based upon Seller’s possession thereof, (e) the valuation
or appraisal, if any, of the subject Mortgaged Property prepared by a third party valuation or appraisal service, (f) the Related
Title Policy, (g) the evidence of liability and property/casualty insurance coverage relating to the Mortgaged Property, and (h)
an opinion, if any, of counsel, addressed to Seller (or its predecessor in interest) that the Mortgage Note, the Mortgage(s) and
the Mortgage Loans Assignments, if any, are the valid and binding obligations of the parties thereto enforceable in accordance
with their terms and have been duly and validly endorsed or assigned to Seller (or its predecessor in interest).

 

“Mortgage
Note” means the original executed promissory note or other evidence of the indebtedness of a Mortgagor Customer with
respect to a Mortgage Loan.

 

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“Mortgaged
Property” means the real property (including all improvements, buildings, fixtures, building equipment and personal
property thereon and all additions, alterations and replacements made at any time with respect to the foregoing) and all other
collateral securing repayment of the debt evidenced by a Mortgage Note.

 

“Person”
means any individual, corporation, partnership, joint venture, limited liability company, association, joint-stock company, trust,
unincorporated organization or Governmental Body.

 

“Purchase”
means a purchase by Buyer of Mortgage Loans pursuant to Section 2.1.

 

“Purchase
Date” means each Business Day on which any Mortgage Loan and the related Mortgage Loan Assets are acquired by Buyer
pursuant to the terms of this Agreement.

 

“Responsible
Officer” means, with respect to any Person, any duly authorized officer of such Person with direct responsibility
for the administration of this Agreement and also, with respect to a particular matter, any other duly authorized officer of such
Person to whom such matter is referred because of such officer’s knowledge of and familiarity with the particular subject.

 

“Transfer
Tax” means any transfer, documentary, sales, bulk sales, use, registration, value added or other similar tax, including
any applicable real estate transfer tax and any real property transfer gains tax.

 

“UCC”
means the Uniform Commercial Code as in effect in any applicable jurisdiction.

 

“Unmatured
Termination Event” means any event which is, or after notice or lapse of time would become, a Termination Event.

 

ARTICLE
II

PURCHASE AND SALE

 

2.1           Purchased
Assets.

 

(a)          On
the terms and subject to the conditions set forth in this Agreement (including the conditions to Purchase set forth in ARTICLE
IV), on each Purchase Date, Seller hereby sells, transfers, assigns, sets over and otherwise conveys to Buyer, and Buyer hereby
purchases and takes from Seller, free and clear of all Encumbrances, all right, title and interest of Seller in the property
identified in clauses (i) - (iii) below, whether constituting chattel paper, tangible chattel paper, electronic chattel paper,
copyrights, copyright licenses, equipment, fixtures, contract rights, general intangibles, instruments, certificates of deposit,
certificated securities, uncertificated securities, financial assets, securities entitlements, commercial tort claims, deposit
accounts, inventory, investment property, letter-of-credit rights, software, supporting obligations, accessions or other property,
consisting of, arising out of, or related to any of the following :

 

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(i)          the
Mortgage Loans identified by Seller as of the initial Purchase Date which are listed on Schedule I hereto, and the Mortgage
Loans identified by Seller as of any additional Purchase Date which are listed on Schedule I to the applicable Sale Assignment,
together with all monies due or to become due in payment under such Mortgage Loans on and after the applicable Purchase Date; and

 

(ii)         all
Mortgage Loan Documents and other related Mortgage Loan Assets with respect to the Mortgage Loans referred to in clause (i) above.

 

(b)          Seller
shall, on or prior to each Purchase Date, execute and deliver to Buyer a certificate of assignment (the “Sale Assignment”)
in the form of Exhibit A hereto. On or before any Purchase Date with respect to the Mortgage Loans to be acquired by Buyer on that
date, Seller shall provide Buyer with an Officer’s Certificate, in the form of Exhibit B hereto, signed by a Responsible
Officer certifying, as of such Purchase Date, to each of the items in Sections 5.9 and 5.1919 hereof.

 

(c)          Except
as specifically provided in this Agreement, the sale and purchase of Mortgage Loans under this Agreement shall be without recourse
to Seller; it being understood that Seller shall be liable to Buyer for all representations, warranties, covenants
and indemnities made by Seller pursuant to the terms of this Agreement and to the extent provided herein.

 

(d)          In
connection with each Purchase of Mortgage Loans hereunder, Seller shall deliver to the Indenture Trustee the Mortgage Loan Files
on or prior to the related Purchase Date (and if prior to the related Purchase Date, such Mortgage Loan Files shall be held by
the Indenture Trustee in escrow until such Purchase shall occur on the related Purchase Date).

 

(e)          In
connection with the transfers contemplated by this Agreement, Seller hereby grants to Buyer an irrevocable, non–exclusive
license to use, without royalty or payment of any kind, all software used by Seller to account for the Mortgage Loans, to the extent
necessary to administer the Mortgage Loans, whether such software is owned by Seller or is owned by others and used by 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 or for Seller to assign such licenses to Buyer or any such successor
servicer, Seller hereby agrees that upon the request of Buyer or such successor Servicer, Seller will use its best efforts to obtain
the consent of such third–party licensor. Seller (i) shall take such action requested by Buyer or the Indenture Trustee from
time to time hereafter, that may be necessary or appropriate to ensure that Buyer and the Indenture Trustee have an enforceable
security interest in the Mortgage Loans purchased by Buyer as contemplated by this Agreement, and (ii) shall use its best efforts
to ensure that each of Buyer and the Indenture Trustee has an enforceable right (whether by license or sublicense or otherwise)
to use all of the computer software used to account for the Mortgage Loans.

 

(f)          In
connection with the purchase by Buyer of the Mortgage Loans as contemplated by this Agreement, Seller further agrees that it will,
at its own expense, indicate clearly and unambiguously in its computer files on or prior to each Purchase Date, and, to the extent
required under U. S. Generally Accepted Accounting Principles (“GAAP”) in the footnotes to its financial statements,
that such Mortgage Loans has been purchased by Buyer in accordance with this Agreement.

 

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(g)          Seller
further agrees to deliver to Buyer on or before each Purchase Date a true, complete and correct list of all Mortgage Loans to be
sold or otherwise conveyed hereunder on such Purchase Date, identified by Mortgagor Customer name, account number and outstanding
loan balance as of the related Purchase Date. Such list shall constitute a supplement to Schedule I to this Agreement and shall
be automatically incorporated into and made a part of this Agreement as such.

 

(h)          It
is the intention of the parties hereto that the conveyance of all right, title and interest of Seller in and to any Mortgage Loan
to Buyer as provided in this Section 2.1 shall constitute an absolute transfer conveying good title, free and clear of any Encumbrance
and that the Mortgage Loan shall not be part of the bankruptcy estate of Seller in the event of a bankruptcy event with respect
to Seller. Furthermore, it is not intended that such conveyance be deemed a pledge of the Mortgage Loans and the related Mortgage
Loan Assets to Buyer to secure a debt or other obligation of Seller. If, however, notwithstanding the intention of the parties,
the conveyance provided for in this Section 2.1 is determined to be a transfer for security, then this Agreement shall also be
deemed to be, and hereby is, a “security agreement” within the meaning of Article 9 of the UCC and Seller hereby grants
to Buyer a “security interest” within the meaning of Article 9 of the UCC in all of its right, title and interest in,
to and under the Mortgage Loans and the related Mortgage Loan Assets, now existing and hereafter created, to secure the prompt
and complete payment of a loan deemed to have been made in an amount equal to the aggregate Purchase Price of the Mortgage Loans
together with all of the other obligations of Seller hereunder. Buyer shall have, in addition to the rights and remedies which
it may have under this Agreement, all other rights and remedies provided to a secured creditor under the UCC and other applicable
law, which rights and remedies shall be cumulative.

 

2.2           Liabilities.
Buyer shall not assume or be obligated to pay, perform or otherwise discharge any Liability of
Seller except for any obligation arising after the date hereof under the Mortgage Loans.

 

2.3           Title.
Seller hereby covenants and agrees that it will warrant and defend title to the Mortgage Loans
and the Mortgage Loan Mortgage Loans.

 

ARTICLE
III

PURCHASE PRICE

 

3.1           Purchase
Price. The purchase price for the Mortgage Loans and Mortgage Loan Assets sold to Buyer by
Seller under this Agreement shall be a dollar amount equal to the outstanding loan balance thereof, to be determined as of the
related Purchase Date (the “Purchase Price”), in each case to be paid in accordance with Section 3.2 hereof.

 

3.2           Payment
of Purchase Price.

 

(a)          The
Purchase Price for any Mortgage Loan sold by Seller to Buyer on any Purchase Date shall be paid in immediately available funds.

 

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(b)          Seller,
in connection with each delivery of a Sale Assignment hereunder relating to any Mortgage Loan on any Purchase Date, shall be deemed
to have certified, with respect to such Mortgage Loan, that its representations and warranties contained in __________ are
true and correct on and as of such day, with the same effect as though made on and as of such day and that no Termination Event
or Unmatured Termination Event has occurred.

 

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

 

3.3           Tax
Treatment. Any federal, state and local income taxes or any Transfer Tax payable with respect
to the sale of the Mortgage Loans pursuant to this Agreement shall be payable by Seller.

 

ARTICLE
IV

CONDITIONS PRECEDENT

 

4.1           Conditions
Precedent to Closing and Initial Purchase. The closing and initial Purchase hereunder are
subject to the conditions precedent that (i) each of the conditions precedent to the execution, delivery and effectiveness of each
other Transaction Document (other than a condition precedent in any such other Transaction Document relating to the effectiveness
of this Agreement) shall have been fulfilled and (ii) on or prior to the Closing Date, Seller shall have delivered to Buyer each
of the items specified on Appendix A hereto in form and substance satisfactory to Buyer.

 

4.2           Conditions
Precedent to all Purchases.

 

The obligations of Buyer
to Purchase the Mortgage Loans as contemplated by this Agreement on any Purchase Date (including the initial Purchase Date) shall
be subject to the satisfaction of the following conditions precedent:

 

(a)          all
representations and warranties of Seller contained in ________________. shall be true and correct in all material respects on
and as of such date as though made on and as of such date and shall be deemed to have been made on and as of such day (other
than any representation and warranty that is made as of a specific date);

 

(b)          Seller
shall have delivered to Buyer a duly executed and completed Sale Assignment along with a Schedule I that is true, accurate and
complete in all material respects as of the related Purchase Date;

 

(c)          Seller
shall have performed in all material respects all of the covenants and agreements required to be performed by it on or prior to
such date pursuant to the provisions of this Agreement;

 

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(d)          no
Termination Event or Unmatured Termination Event shall have occurred or would result from such Purchase; and

 

(e)          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 Purchase by Buyer in accordance with the provisions
hereof.

 

ARTICLE
V

REPRESENTATIONS AND WARRANTIES OF SELLER

 

As of each Purchase Date,
Seller represents and warrants to Buyer for the benefit of Buyer and each of its successors and assigns as follows:

 

5.1           Organization
of Seller. Seller is a corporation organized, validly existing and in good standing under the laws of the State of New
York.

 

5.2           Authority
of Seller.

 

(a)          Seller
has full power and authority to execute, deliver and perform its obligations this Agreement. The execution, delivery and performance
of this Agreement by Seller has been duly authorized and approved by and does not require any further authorization or consent.
This Agreement has been duly executed and delivered by Seller and is the legal, valid and binding obligation of Seller enforceable
in accordance with its terms.

 

(b)          The
execution and delivery by Seller of this Agreement will not:

 

(i)          conflict
with, result in a breach of the terms, conditions or provisions of, or constitute a default, an event of default or an event creating
rights of acceleration, termination or cancellation or a loss of rights under Seller’s organizational documents or any contractual
obligations of Seller or result in the creation or imposition of any Encumbrance upon any of the Mortgage Loans

 

(ii)         violate
in any material respect any law applicable to Seller or the Mortgage Loans; or

 

(iii)        require
the approval, consent, authorization or act of, or the making of any filing with, any Person, other than those which have been
obtained.

 

5.3           Litigation.

 

(a)          Neither
Seller nor any Mortgage Loan is subject to any Court Order; and

 

(b)          there
are no lawsuits, claims, suits, complaints, proceedings or investigations pending or, to the Knowledge of Seller, threatened against
or affecting Seller (i) asserting the invalidity of this Agreement, (ii) seeking to prevent the consummation of any of the transactions
contemplated by this Agreement, (ii) seeking to prevent the consummation of any of the transactions contemplated by this Agreement
or (iii) in respect of the Mortgage Loans or the Mortgage Loan Documents.

 

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5.4           Consents.
All approvals, authorizations, consents, orders, licenses or other actions of any Person or of any Governmental Body (if any) required
for the due execution, delivery and performance by Seller of this Agreement have been obtained.

 

5.5           Solvency.
Seller is not the subject of any state or federal bankruptcy or insolvency proceeding. The transactions under this Agreement do
not and will not render Seller insolvent. 

 

5.6           Selection
Procedures. No procedures adverse to the interests of Buyer were utilized by Seller in identifying
and/or selecting the Mortgage Loans sold to Buyer.

 

5.7           Taxes.
Seller has filed or caused to be filed all tax returns that are required to be filed by it. Seller
has paid or made adequate provisions for the payment of all Taxes and all assessments made against it or any of its properties
(other than any amount of Tax the validity of which is currently being contested in good faith by appropriate proceedings and with
respect to which reserves in accordance with GAAP have been provided on the books of Seller), and no tax lien has been filed against
Seller or any of its properties and, to Seller’s knowledge, no claim is being asserted by an applicable Governmental Body,
with respect to any such Tax, assessment or other charge.

 

5.8           Exchange
Act Compliance; Regulations T, U and X. None of the transactions contemplated herein (including,
without limitation, the use of the proceeds from the sale of the Mortgage Loans) 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. Seller does not own or intend to carry or purchase, and
no proceeds from the sale of the Mortgage Loans will be used to carry or purchase, any “margin stock” within the meaning
of Regulation U or to extend “purpose credit” within the meaning of Regulation U.

 

5.9           Security
Interest.

 

(a)          This
Agreement constitutes a valid transfer to Buyer of all right, title and interest of Seller in, to and under all of the Mortgage
Loans and Mortgage Loans, free and clear of any Encumbrance of any Person claiming through or under Seller or its Affiliates. If
the conveyances contemplated by this Agreement are determined to be a transfer for security, then this Agreement creates a valid
and continuing security interest (as defined in the applicable UCC) in the Mortgage Loans and related assets sold to Buyer in favor
of Buyer and the Indenture Trustee as assignee, on behalf of the Noteholders, which security interest is prior to all other Encumbrances,
and is enforceable as such against creditors of and purchasers from Seller. Upon the filing of a financing statement naming Seller
as debtor, Buyer as secured party and Indenture Trustee as assignee, and delivery by Seller to Indenture Trustee of the Mortgage
Notes, the Mortgages and the other Mortgage Documents, such security interest shall be a valid and first priority perfected security
interest in all of the Mortgage Loans and related assets.

 

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(b)          Seller
owns and has good and marketable title to the Mortgage Loans sold or otherwise conveyed by it to Buyer hereunder on such Purchase
Date, free and clear of any Encumbrance of any Person.

 

(c)          Seller
has received all consents and approvals required by the terms of any Mortgage Loan, if any, to the sale and granting of a security
interest in therein hereunder to Buyer and the Indenture Trustee as assignee, on behalf of the Noteholders.

 

(d)          All
appropriate financing statements have been filed in the proper filing office in the appropriate jurisdictions under applicable
law in order to perfect the security interest in that portion of the Mortgage Loans and related assets in which a security interest
may be perfected by filing granted hereunder to Buyer and the Indenture Trustee as assignee, on behalf of the Noteholders.

 

(e)          Other
than the security interest granted to Buyer and the Indenture Trustee as assignee, on behalf of the Noteholders, Seller has not
pledged, assigned, sold, granted a security interest in or otherwise conveyed any of the Mortgage Loans. Seller has not authorized
the filing of and is not aware of any financing statements against Seller that include a collateral description covering the Mortgage
Loans other than any financing statement (A) relating to the security interest granted to Buyer under this Agreement and to the
Indenture Trustee for the benefit of the Noteholders under the Indenture, or (B) that has been terminated and/or fully and validly
assigned to Buyer on or prior to the date hereof or the applicable Purchase Date. Seller is not aware of the filing of any judgment
or tax lien filings against Seller;

 

(f)          All
original executed copies of each underlying Mortgage Note and related Mortgage that constitute or evidence each Mortgage Loan have
been delivered to the Indenture Trustee; and

 

(g)          None
of the Mortgage Notes that constitute or evidence the Mortgage Loans has any marks or notations indicating that they have been
pledged, assigned or otherwise conveyed to any Person other than the Indenture Trustee as assignee, on behalf of the Noteholders.

 

5.10         Reports
Accurate. All information, exhibits, schedules, financial statements, documents, books, records
or reports furnished or to be furnished by Seller to Buyer in connection with this Agreement are or, at the time of delivery, will
be, true, and correct and complete in all material respects.

 

 

5.11         Location
of Offices. Seller’s location (within the meaning of Article 9 of the UCC) is Great
Neck, New York.

 

5.12         Value
Given. Buyer has given reasonably equivalent value in consideration for the transfer to Buyer
of the Mortgage Loans as contemplated by this Agreement, no such transfer has been made for or on account of an antecedent debt
owed by Seller to Buyer, and no such transfer is or may be voidable or subject to avoidance as to Seller under any section of federal
or state bankruptcy, insolvency or similar law.

 

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5.13         Investment
Company Act. Seller is not, and is not controlled by, an “investment company”
within the meaning of, or is exempt from the provisions of, the Investment Company Act of 1940, as amended.

 

5.14         Compliance
with Law. Seller has complied in all material respects with all laws to which it may be subject,
and no Mortgage Loan contravenes in any material respect any applicable law (including, without limitation, all applicable laws
relating to predatory and abusive lending and all laws, rules and regulations relating to licensing, truth in lending, fair credit
billing, fair credit reporting, equal credit opportunity, fair debt collection practices, and privacy).

 

5.15         Covenants.
All covenants, agreements and undertakings of Seller hereunder have been fully performed.

 

5.16         Set–Off,
etc. No Mortgage Loan has been compromised, adjusted, extended, satisfied, subordinated,
rescinded, set–off or modified by Seller or the related Mortgagor Customer, and no Mortgage Loan is subject to compromise,
adjustment, extension, satisfaction, subordination, rescission, set–off, counterclaim, defense, abatement, suspension, deferment,
deduction, reduction, termination or modification, whether arising out of transactions concerning such Mortgage Loan or otherwise,
by Seller or such Mortgagor Customer, except for amendments, extensions or modifications to such Mortgage Loan otherwise permitted
under the Transaction Documents (as defined in the Indenture).

 

5.17         Full
Payment. As of the related Purchase Date thereof, Seller has no knowledge of any fact with
respect to any Mortgage that should lead it to expect that such Mortgage Loan will not be paid in full.

 

5.18         Representations
and Warranties for Benefit of Buyer’s Assignees.  Each of the representations and warranties
of Seller contained in this Agreement and the other Transaction Documents to which it is a party and that have been executed and
delivered on or prior to such Purchase Date is true and correct in all material respects on the date it was made, and Seller hereby
makes each such representation and warranty to, and for the benefit of the Indenture Trustee and the Noteholders.

 

5.19         Eligibility
of Mortgage Loans. As of each Purchase Date, (i) Schedule I is an accurate and complete listing
of all the Mortgage Loans as of such Purchase Date and the information contained therein with respect to the identity of such Mortgage
Loans and the amounts owing thereunder is true, correct and complete as of such Purchase Date and (ii) each Loan is an Eligible
Mortgage Loan (as such term is defined in the Indenture).

  

5.20         No
Fraud. Each Loan was originated without any fraud or material misrepresentation by Seller
or, to the best of Seller’s knowledge, on the part of the related Mortgagor Customer.

 

It is understood and
agreed that the representations and warranties provided in this ________________ shall survive (x) the sale and assignment
of the Mortgage Loans to Buyer and (y) the termination of this Agreement. Upon discovery by Seller or Buyer of a breach of any
of the foregoing representations and warranties, the party discovering such breach shall give prompt written notice thereof to
the other and to the Indenture Trustee immediately upon obtaining knowledge of such breach.

 

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ARTICLE
VI

REPRESENTATIONS AND WARRANTIES OF BUYER

 

As an inducement to Seller
to enter into this Agreement and to consummate the Transactions contemplated hereby, Buyer hereby represents and warrants to Seller
and agrees as follows:

 

6.1          Organization
of Buyer. Buyer is a corporation duly organized, validly existing and in good standing under
the laws of the State of New York.

 

6.2          Authority
of Buyer.

 

(a)          Buyer
has full power and authority to execute, deliver and perform its obligations this Agreement. The execution, delivery and performance
of this Agreement by Buyer have been duly authorized and approved by Buyer and do not require any further authorization or consent.
This Agreement has been duly executed and delivered by Buyer and is the legal, valid and binding agreement of Buyer enforceable
in accordance with its terms.

 

(b)          The
execution and delivery by Buyer of this Agreement will not require the approval, consent, authorization or act of, or the making
of any filing with, any Person.

 

ARTICLE
VII

AFFIRMATIVE COVENANTS

 

From the date hereof
until the termination of this Agreement:

 

7.1          Preservation
of Organizational Existence. Seller will preserve and maintain its corporate existence, rights,
franchises and privileges in the jurisdiction of its formation.

 

7.2          Keeping
of Records and Books of Account. Seller will maintain and implement administrative and operating
procedures (including, without limitation, an ability to recreate records evidencing the Mortgage Loans conveyed by it in the event
of the destruction of the originals thereof), and keep and maintain all documents, books, records and other information reasonably
necessary or advisable for the collection of all or any portion of the Mortgage Loans.

 

    	 	12	 

     

    

  

7.3          Protection
of Interest in Mortgage Loans. All Mortgage Loans acquired by Buyer from Seller will be acquired
pursuant to and in accordance with the terms of this Agreement and Seller will (i) (at Buyer’s expense) take all action necessary
to perfect, protect and more fully evidence Buyer’s or its assignee’s ownership or security interest in such Mortgage
Loans free and clear of any Encumbrance other than the Encumbrance created hereunder and under the Indenture, including, without
limitation, (a) maintain (at Buyer’s expense), effective financing statements against Seller in all necessary or appropriate
filing offices (including any amendments thereto or assignments thereof), and filing continuation statements, amendments or assignments
with respect thereto in such filing offices (including any amendments thereto or assignments thereof), and (b) executing or causing
to be executed such other instruments or notices as may be necessary or appropriate, (iii) permit Buyer or the Indenture Trustee
or their respective agents or representatives to visit the offices of Seller during normal office hours and upon reasonable notice
examine and make copies of all documents, books, records and other information concerning the Mortgage Loans and discuss matters
related thereto with any of the officers or employees of Seller having knowledge of such matters (provided, however,
that no more than two such visits in any calendar quarter and no more than four such visits per calendar year (together with any
such visits/audits conducted pursuant to the Indenture) by the Indenture Trustee shall be permitted prior to the occurrence of
a Termination Event and provided further that Buyer shall pay the costs and expenses for all such visits), and (iv) take
all additional action that Buyer or the Indenture Trustee may reasonably request to perfect, protect and more fully evidence the
respective interests of the parties to this Agreement in the Mortgage Loans.

 

7.4          Deposit
of Collections. In the event any payments relating to any Mortgage Loans are remitted directly
to Seller or any Affiliate of Seller, 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, Seller will itself hold
or, if applicable, will cause such payments to be held in trust for the exclusive benefit of Buyer and the Indenture Trustee. Until
so deposited, all such Collections shall be held in trust for Buyer or its assignees by Seller.

 

7.5          Termination
Events. Seller will provide Buyer and the Indenture Trustee with immediate written notice
of the occurrence of each Termination Event and each Unmatured Termination Event of which Seller has Knowledge or has received
notice. In addition, no later than three Business Days following Seller’s Knowledge or notice of the occurrence of any Termination
Event or Unmatured Termination Event, Seller will provide to Buyer and the Indenture Trustee a written statement of a Responsible
Officer of Seller setting forth the details of such event and the action that Seller proposes to take with respect thereto.

 

7.6          Notices.

 

(a)           Representations
and Warranties. Forthwith upon receiving knowledge of same, Seller shall notify Buyer and the Indenture Trustee if any representation
or warranty set forth in Error! Reference source not found. was incorrect at the time it was given or deemed to have been
given and at the same time deliver to Buyer and the Indenture Trustee a written notice setting forth in reasonable detail the
nature of such facts and circumstances. In particular, but without limiting the foregoing, Seller shall notify Buyer and the Indenture
Trustee in the manner set forth in the preceding sentence before any Purchase Date of any facts or circumstances within the knowledge
of Seller which would render any of the said representations and warranties untrue at the date when such representations and warranties
were made or deemed to have been made.

 

    	 	13	 

     

    

  

(b)          Other.
Seller will furnish to Buyer and the Indenture Trustee promptly, from time to time, at Buyer’s expense, such other information,
documents, records or reports respecting the Mortgage Loans as Buyer or the Indenture Trustee may from time to time reasonably
request in order to protect the interests of Buyer, and the Indenture Trustee and the Noteholders under or as contemplated by this
Agreement and the Indenture.

 

ARTICLE
VIII

NEGATIVE COVENANTS OF SELLER.

 

From the date hereof
until the Collection Date:

 

8.1           Security
Interests. Except as otherwise permitted herein and following the reacquisition of any Mortgage
Loan by Seller pursuant to Error! Reference source not found., Seller will not sell, pledge,
assign or transfer to any other Person, or grant, create, incur, assume or suffer to exist any Encumbrance on any Mortgage Loans
conveyed by it, whether now existing or hereafter transferred hereunder, or any interest therein, and Seller will not sell, pledge,
assign or suffer to exist any Encumbrance on its interest in such Mortgage Loans. Seller will promptly notify Buyer and the Indenture
Trustee of the existence of any Encumbrance on any Mortgage Loans conveyed by it and Seller shall defend the right, title and interest
of Buyer and the Indenture Trustee in, to and under the Mortgage Loans against all claims of third parties.

 

8.2           Change
of Name or Location of Servicing Files. Seller shall not change its name, move the location
of its principal place of business and chief executive office, change its jurisdiction of organization or change the offices where
it keeps the records from the location referred to in Section 14.1 unless Seller has given at least thirty (30) days’ written
notice to Buyer and the Indenture Trustee and has taken all actions required under the UCC of each relevant jurisdiction in order
to continue the first priority perfected security interest of Buyer and the Indenture Trustee in the Mortgage Loans.

 

8.3           Accounting
of Purchases. Other than for tax and consolidated accounting purposes, 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 of the Mortgage Loans to Buyer.

 

8.4           Changes
in Payment Instructions to Mortgagor Customers. Seller will instruct Mortgagor Customers
to make payments to the Collection Account and will not change such instructions to Mortgagor Customers regarding such payments,
unless Buyer and the Indenture Trustee have consented in writing to such change.

 

8.5           Extension
or Amendment of Mortgage Loans. Seller will not, except as otherwise permitted in the Indenture,
extend, amend or otherwise modify the terms of any Mortgage Loans.

 

ARTICLE
IX

REPURCHASE OBLIGATION

 

9.1           Retransfer
of Mortgage Loans.

 

If on any day Buyer is
obligated to replace a Mortgage Loan pursuant to Section 2.04, Section 11.01 or Section 11.02 of the Indenture, Seller shall, subject
to its receipt of a written consent, waiver and/or release of lien, from Webster Business Credit Corporation or such other Person
that is then a lienholder with respect to Seller’s assets either:

 

    	 	14	 

     

    

  

(a)          make
a deposit to the Collection Account in immediately available funds in an amount equal to the Release Price with respect to such
Mortgage Loan; or

 

(b)          subject
to the satisfaction of the conditions in Section Error! Reference source not found. hereof, substitute for such Mortgage
Loan a Qualified Substitute Mortgage Loan (as defined in the Indenture).

 

In either of the foregoing instances, Seller
may (in its discretion) accept retransfer of each such Mortgage Loan.

 

9.2           Substitution
of Loans.

 

On any day prior to the
occurrence of a Termination Event, Seller may, subject to the conditions set forth in this Section Error! Reference source not
found. and subject to the other restrictions contained herein, replace any Mortgage Loan previously acquired by Buyer hereunder
with one or more Eligible Mortgage Loans (each a “Substitute Mortgage Loan”); provided that, no such
replacement shall occur unless each of the following conditions is satisfied as of the date of such replacement and substitution
or have otherwise been waived in writing by the Indenture Trustee:

 

(a)          each
Substitute Mortgage Loan is an Eligible Mortgage Loan on the date of substitution;

 

(b)          the
sum of the outstanding loan balances of such Substitute Mortgage Loans shall be equal to or greater than the sum of the outstanding
loan balances of the Mortgage Loan to be replaced (each a “Replaced Loan”);

 

(c)          all representations and warranties of Seller contained in Error! Reference source not found. shall
be true and correct as of the date of substitution of any such Substitute Mortgage Loan;

 

(d)          the
substitution of any Substitute Mortgage Loan does not cause a Termination Event or Unmatured Termination Event to occur; and

 

(e)          Seller
shall deliver to Buyer on the date of such substitution a certificate of a Responsible Officer certifying that each of the foregoing
is true and correct as of such date.

 

In addition, Seller shall
in connection with such substitution deliver or cause to be delivered to the Indenture Trustee the Mortgage Loan Documents related
to such Substitute Mortgage Loan.

 

    	 	15	 

     

    

  

9.3          Retransfer
of Mortgage Loans. Upon confirmation of the deposit
of the outstanding principal balance and accrued interest of such Mortgage Loan into the Collection Account or the delivery by
Seller of a Substitute Mortgage Loan (the date of such confirmation or delivery, the “Retransfer Date”) for each Mortgage
Loan or Replaced Loan, pursuant to Section Error! Reference source not found. or Error!
Reference source not found. hereof, as the case may be, Buyer shall, automatically and without
further action be deemed to transfer, assign and set–over to Seller, without recourse, {Buyer must make the same reps and
warranties that Seller made when it sold the Loan to Buyer. Specifically, that Loan has not been repaid that Loan has not be pledged
etc.} all the right, title and interest of Buyer in, to and under such Mortgage Loan or Replaced Loan and all future monies due
or to become due with respect thereto, the related Mortgage Loan Documents and all proceeds thereof, all rights to security therefor
and products of the foregoing. Buyer shall, at the sole expense of Seller, execute such documents and instruments of transfer
as may be prepared by Seller and take other such actions as shall reasonably be requested by Seller to effect the transfer of
such Loan pursuant to this Section Error! Reference source not found..

 

ARTICLE
X

ADDITIONAL RIGHTS AND OBLIGATIONS IN

RESPECT OF THE MORTGAGE LOANS

 

10.1        Rights
of Buyer.

 

(a)          Seller
hereby authorizes Buyer and the Indenture Trustee and/or their respective designees or assignees to take any and all steps in Seller’s
name and on behalf of Seller that Buyer and/or the Indenture Trustee and/or their respective designees or assignees determine are
necessary or appropriate to collect all amounts due under any and all Mortgage Loans and to enforce or protect Buyer’s and
the Indenture Trustee’s rights under this Agreement, including indorsing the name of Seller on checks and other instruments
representing collections and proceeds thereof and enforcing such Mortgage Loans.

 

(b)          Except
as set forth in Sections Error! Reference source not found. and Error! Reference source not found. with respect the
retransfer or substitution of certain Mortgage Loans, Buyer shall have no obligation to account for, replace, substitute or return
any Mortgage Loans to Seller. Buyer shall have no obligation to account for or to return collections, or any interest or other
finance charge collected pursuant thereto, to Seller, irrespective of whether such collections and charges are in excess of the
Purchase Price for such Mortgage Loans.

 

(c)          Buyer
shall have the unrestricted right to further assign, transfer, deliver, hypothecate, subdivide or otherwise deal with the Mortgage
Loans and all of Buyer’s right, title and interest in, to and under this Agreement, on whatever terms Buyer shall determine,
pursuant to the Indenture or otherwise.

 

(d)          Buyer
shall have the sole right to retain any gains or profits created by buying, selling or holding the Mortgage Loans and shall have
the sole risk of and responsibility for losses or damages created by such buying, selling or holding.

 

10.2        Notice
to Indenture Trustee. Seller agrees that, concurrently with its delivery to Buyer, copies
of all notices, reports, documents and other information required to be delivered by Seller to Buyer hereunder shall be delivered
by Seller to the Indenture Trustee.

 

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ARTICLE
XI

TERMINATION EVENTS

 

11.1        Termination
Events.

 

If any of the following
events (each a “Termination Event”) shall have occurred:

 

(i)          Seller
shall fail to pay any amount due pursuant to Section 9.1 hereof in accordance with the provisions thereof or to pay any other amount
required to be paid by Seller and such failure shall continue unremedied for a period of five (5) Business Days; or

 

(ii)         Seller
shall fail to observe or perform any covenant or agreement applicable to it contained herein (other than as specified in paragraph
(i) of this Section 11.1); provided that, no such failure shall constitute a Termination Event under this paragraph (ii)
unless such failure shall continue unremedied for a period of 30 consecutive days; or

 

(iii)        any
representation, warranty, certification or statement made or deemed made by Seller in this Agreement or in any statement, record,
certificate, financial statement or other document delivered pursuant to this Agreement shall prove to have been incorrect in any
material respect when made or deemed made, provided that a Termination Event shall not be deemed to have occurred under
this paragraph (iii) based upon a breach of any representation or warranty set forth in Section 5.1919 hereof if Seller shall have
complied with the provisions of Section 9.1 hereof in respect thereof; or

 

(iv)        (A)
a court having jurisdiction in the premises shall enter a decree or order for relief in respect of Seller in an involuntary case
under federal or state bankruptcy, insolvency or similar law , which decree or order is not stayed or any other similar relief
shall be granted under any applicable federal or state law now or hereafter in effect and shall not be stayed; (B) (I) any involuntary
case is commenced against Seller under any federal or state bankruptcy, insolvency or similar law now or hereafter in effect, a
decree or order of a court having jurisdiction in the premises for the appointment of a receiver, liquidator, sequestrator, trustee,
custodian or other officer having similar powers over Seller, or over all or a substantial part of the property of Seller, shall
have been entered, an interim receiver, trustee or other custodian of Seller for all or a substantial part of the property of Seller
is involuntarily appointed, a warrant of attachment, execution or similar process is issued against any substantial part of the
property of Seller, and (II) any event referred to in clause (B)(I) above continues for 60 days unless dismissed, bonded or disclosed;
(C) Seller shall at its request have a decree or an order for relief entered with respect to it or commence a voluntary case
under any federal or state bankruptcy, insolvency or similar law now or hereafter in effect, or shall consent to the entry of a
decree or an order for relief in an involuntary case, or to the conversion of an involuntary case to a voluntary case, under any
such Insolvency Law, consent to the appointment of or taking possession by a receiver, trustee or other custodian for all or a
substantial part of its property; (D) the making by Seller of any general assignment for the benefit of creditors; (E) the inability
or failure of Seller generally to pay its debts as such debts become due; or (F) the board of directors of Seller authorizes action
to approve any of the foregoing; or

 

    	 	17	 

     

    

  

(v)         there
shall have occurred an Event of Default set forth in Section 4.01 of the Indenture; or

 

(vi)        a
notice of Encumbrance shall have been filed by the Pension Benefit Guaranty Corporation against Seller under Section 412(n) of
the Code or Section 302(f) of ERISA for a failure to make a required installment or other payment to a plan to which Section 412(n)
of the Code or Section 302(f) of ERISA applies unless there shall have been delivered to the Indenture Trustee proof of release
of such Encumbrance; or

 

(vii)       any
Encumbrance in an amount equal to or greater than $500,000 has been asserted against or imposed on, any real or personal property
of Seller pursuant to the Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. § 9607(1), or any
equivalent or comparable state law, relating to or arising from the costs of, response to, or investigation, remediation or monitoring
of, any environmental contamination resulting from the current or past operations of Seller; or

 

(viii)      a
Federal tax notice of Encumbrance, in an amount equal to or greater than $500,000, shall have been filed against Seller unless
there shall have been delivered to the Indenture Trustee proof of release of such Encumbrance

 

then, in the case of any Termination Event
described in paragraph (iv), (v), (vi), (vii) or (viii) above the obligation of Buyer to purchase Mortgage Loans from Seller
shall thereupon automatically terminate without further notice of any kind, which is hereby waived by Seller, and (B) in the case
of any other Termination Event, so long as such Termination Event shall be continuing, Buyer or the Indenture Trustee may terminate
Buyer’s obligation to purchase Mortgage Loans from Seller by written notice to Seller (any termination pursuant to this Section
11.1 is herein called an “Early Termination”); provided that in the event of any involuntary petition
or proceeding as described in paragraph (iv) above, Buyer shall not purchase Mortgage Loans from Seller unless such involuntary
petition or proceeding is dismissed, bonded or discharged within 60 days of the filing of such petition or the commencement of
such proceeding.

 

ARTICLE
XII

INDEMNIFICATION

 

12.1        Indemnification
by Seller.

 

(a)          Without
limiting any other rights that Buyer, any assignee of Buyer, including but not limited to the Noteholders and the Indenture Trustee,
or any of such Persons’ respective shareholders, officers, employees, agents, or Affiliates (each an “Indemnified
Party”) may have hereunder or under applicable law, Seller hereby agrees to indemnify each Indemnified Party from and
against any and all damages, losses, claims, liabilities and related costs and expenses, including attorneys’ fees and disbursements
(all of the foregoing being collectively referred to as “Indemnified Amounts”), awarded against or incurred
by such Indemnified Party or non–monetary damages of any such Indemnified Party excluding, however, Indemnified Amounts to
the extent resulting from the gross negligence or willful misconduct on the part of the applicable Indemnified Party, relating
to or resulting from:

 

    	 	18	 

     

    

  

(i)          any
representation or warranty made or deemed made by Seller, or any of its officers, under or in connection with this Agreement, which
shall have been false, incorrect or misleading when made or deemed made or delivered;

 

(ii)         the
failure by Seller to comply with any term, provision or covenant contained in this Agreement or any agreement executed in connection
with this Agreement, or with any applicable law, including with respect to any Mortgage Loans or the nonconformity of any Mortgage
Loans with any such applicable law;

 

(iii)        the
failure to vest and maintain vested in Buyer, an undivided ownership interest in the Mortgage Loans and all related assets free
and clear of any Encumbrance whether existing at the time of any Purchase or at any time thereafter (including, without limitation,
as a result of the failure to file, or any delay in filing, financing statements, continuation statements or other similar instruments
or documents under the UCC of any applicable jurisdiction or other applicable law, whether at the time of any Purchase or at any
subsequent time);

 

(iv)        any
dispute, claim, offset or defense (other than the discharge in bankruptcy of any Mortgagor Customer) of any Mortgagor Customer
to the payment with respect to any Mortgage Loans (including, without limitation, a defense based on the Mortgage Loans not being
a legal, valid and binding obligations of the related Mortgagor Customer enforceable against it in accordance with its terms),
or any other claim related to such Mortgage Loans;

 

(v)         any
failure of Seller to have performed its duties under any Mortgage;

 

(vi)        any
inability to obtain any judgment in, or utilize the court or other adjudication system of, any state in which a Mortgagor Customer
may be located as a result of the failure of Seller to qualify to do business or file any notice or business activity report or
any similar report;

 

(vii)       any
claim, suit or action of any kind arising out of or in connection with Environmental Laws, including any vicarious liability;

 

(viii)      the
failure by Seller to pay when due any taxes for which Seller is liable, including without limitation, sales, excise or personal
property taxes payable in connection with the Mortgage Loans;

 

(ix)         the
commingling of collections on the Mortgage Loans at any time with other funds of Seller;

 

(x)          any
investigation, litigation or proceeding related to this Agreement or the use of proceeds of Purchases by Seller or the security
interest in the Mortgage Loans;

 

    	 	19	 

     

    

  

(xi)         any
failure by Buyer to give at least reasonably equivalent value to Seller in consideration for the transfer to Buyer of any of the
Mortgage Loans or any attempt by any Person to void or otherwise avoid any such transfer under any statutory provision or common
law or equitable action, including, without limitation, any provision of any federal or state bankruptcy, insolvency or similar
law; or

 

(xii)        the
failure of Seller or any of its agents or representatives to remit to Buyer collections on the Mortgage Loans remitted to Seller
or any such agent or representative as provided in this Agreement.

 

(b)          Any
amounts subject to the indemnification provisions of this Section 12.1 shall be paid by Seller to the Indemnified Party within
five Business Days following such Person’s demand therefor.

 

(c)          If
for any reason the indemnification provided above in this Section 12.1 is unavailable to the Indemnified Party or is insufficient
to hold an Indemnified Party harmless, then 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 Seller, on the other hand, but also the relative fault of such Indemnified
Party as well as any other relevant equitable considerations.

 

(d)          Indemnification
under Section 12.1 shall be in an amount necessary to make the Indemnified Party whole after taking into account any tax consequences
to the 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 the Indemnified Party.

 

12.2        Assignment
of Indemnities. Seller acknowledges that, pursuant to the Indenture, Buyer will assign its
rights of indemnity granted hereunder to the Indenture Trustee. Upon such assignment, (i) the Noteholders and the Indenture Trustee
shall have all rights of Buyer hereunder and may in turn assign such rights as permitted by the Indenture, and (ii) the obligations
of Seller under this ARTICLE XII shall inure to the Noteholders or the Indenture Trustee. Seller agrees that, upon such assignment,
the Noteholders and the Indenture Trustee or the assignee of any such Person, as applicable, may enforce directly, without joinder
of Buyer, the indemnities set forth in this ARTICLE XII.

 

ARTICLE
XIII

SURVIVAL

 

13.1        Survival
of Obligations. Notwithstanding any provision contained herein to the contrary, Seller’s
representations, covenants and obligations set forth in Articles IV, V, VI, and VII create and constitute the continuing obligation
of the parties hereto in accordance with its terms, and shall remain in full force and effect until the Notes and all other obligations
of Buyer under the Indenture have been paid in full.

 

    	 	20	 

     

    

  

ARTICLE
XIV

GENERAL PROVISIONS

 

14.1         Notices.
All notices or other communications required or permitted hereunder shall be in writing and shall be deemed given or delivered
when delivered personally or when sent by facsimile or one (1) Business Day after having been dispatched by a nationally recognized
overnight courier service addressed as follows:

 

	 	If to Buyer, to:	MBC FUNDING II CORP.
	 		60 Cutter Mill Road
	 	 	Great Neck, New York
	 	 	Attn:  Assaf Ran
	 	If to Seller, to:	MANHATTAN BRIDGE CAPITAL, INC.

		

	 	 	60 Cutter Mill Road
	 	 	Great Neck, New York
	 	 	Attn:  Assaf Ran

 

or to such other address as such party
may indicate by a notice delivered to the other party hereto.

 

14.2         Successors
and Assigns. Notwithstanding anything to the contrary contained herein, this Agreement may
not be assigned by Buyer or Seller except as permitted by this Section 14.2 or by the Indenture. Simultaneously with the execution
and delivery of this Agreement, Buyer will, pursuant to the Indenture, assign all of its right, title and interest in this Agreement
to the Indenture Trustee as agent for the Noteholders, to which assignment Seller hereby expressly consents. Upon assignment, Seller
agrees to perform its obligations hereunder for the benefit of the Indenture Trustee as agent for the Noteholders and the Indenture
Trustee, in such capacity, shall be a third party beneficiary hereof. The Indenture Trustee as agent for the Noteholders upon such
assignment may enforce the provisions of this Agreement, exercise the rights of Buyer and enforce the obligations of Seller hereunder
without joinder of Buyer. Notwithstanding the foregoing, Buyer shall continue to remain liable for the performance of its duties
and obligations hereunder.

  

14.3         Amendments
and Waivers. Except as provided in this Section 14.3, no amendment, waiver or other modification
of any provision of this Agreement shall be effective unless signed by Buyer and Seller and consented to in writing by the Indenture
Trustee. Buyer shall provide not less than ten Business Days’ prior written notice of any such amendment to the Indenture
Trustee.

 

14.4         Entire
Agreement. This Agreement contains the entire understanding of the parties hereto with regard
to the subject matter contained herein and supersedes all prior agreements, statements or understandings (oral or written). 

 

    	 	21	 

     

    

  

14.5        Execution
in Counterparts. This Agreement may be executed in one or more counterparts, each of which
shall be considered an original instrument, but all of which shall be considered one and the same agreement, and shall become binding
when one or more counterparts have been signed by each of the parties hereto and delivered to each of Seller and Buyer. Delivery
of an executed counterpart of a signature page to this Agreement shall be as effective as delivery of a manually executed counterpart
of this Agreement.

 

14.6        GOVERNING
LAW; CONSENT TO JURISDICTION; WAIVER OF OBJECTION TO VENUE. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK. EACH OF THE PARTIES HERETO HEREBY AGREES TO THE NON–EXCLUSIVE JURISDICTION OF ANY
FEDERAL COURT LOCATED WITHIN THE STATE OF NEW YORK. EACH OF THE PARTIES HERETO HEREBY WAIVES ANY OBJECTION BASED ON FORUM NON CONVENIENS,
AND ANY OBJECTION TO VENUE OF ANY ACTION INSTITUTED HEREUNDER IN ANY OF THE AFOREMENTIONED COURTS AND CONSENTS TO THE GRANTING
OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY SUCH COURT.

 

14.7        Costs,
Expenses and Taxes. Each Buyer hereto will pay its own expenses in connection with the preparation,
execution, delivery, administration, renewal, modification or amendment of this Agreement and the transactions contemplated hereby.

 

14.8        Waiver
of Setoff.

 

(a)          Seller’s
obligations under this Agreement shall not be affected by any right of setoff, counterclaim, recoupment, defense or other right
Seller might have against Buyer, the Indenture Trustee, the Noteholders or any assignee of such Persons, all of which rights are
hereby waived by Seller.

 

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

 

14.9        Heading
and Exhibits. The headings herein are for purposes of references only and shall not otherwise
affect the meaning or interpretation of any provision hereof. The schedules and exhibits attached hereto and referred to herein
shall constitute a part of this Agreement and are incorporated into this Agreement for all purposes.

 

14.10      No
Waiver; Cumulative Remedies. No failure to exercise and no delay in exercising, on the part
of Buyer or the Seller, 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 privileges provided by law. Any waiver of this Agreement shall be effective
only in the specific instance and for the specific purpose for which given.

 

14.11       Indenture
Agreement. To the extent the terms of this Agreement are inconsistent
or conflict with the terms of the Indenture, the terms of the Indenture Agreement shall supersede the terms hereof.

 

    	 	22	 

     

    

   

IN WITNESS WHEREOF,
the parties hereto have caused this Agreement to be executed the day and year first above written.

 

	 	MANHATTAN BRIDGE CAPITAL, INC.	 
	 	 	 	 
	 	By:	 	 
	 	 	Assaf Ran, Chief Executive Officer	 
	 	 	 	 
	 	MBC FUNDING II CORP.	 
	 	 	 	 
	 	By:	 	 
	 	 	Assaf Ran, Chief Executive Officer	 

 

     

     

    

 

APPENDIX A

 

CONDITION PRECEDENT DOCUMENTS

 

(i)          Copies
of resolutions of the board of directors of Seller approving the execution, delivery and performance of the Agreement and the transactions
contemplated thereby, certified by the Secretary or an Assistant Secretary of Seller.

 

(ii)         A
copy of an officially certified document dated reasonably close to the date of the initial Purchase evidencing the due organization
and good standing of Seller in the applicable jurisdiction.

 

(iii)        Copies
of the organizational documents of Seller certified by the Secretary or an Assistant Secretary of Seller.

 

(iv)        UCC–1
financing statements naming Seller as debtor, Buyer as secured party and the Indenture Trustee as assignee, describing the Mortgage
Loans and related assets and meeting the requirements of the laws of each jurisdiction in which it is necessary to perfect the
conveyance thereof to Buyer.

 

(v)         Opinion
of counsel to Seller, dated the date of the initial Purchase, in form and substance satisfactory to Buyer.

 

(vi)        Executed
counterparts of this Agreement executed by Seller.

 

(vii)       A
duly completed, executed and delivered initial list of Mortgage Loans and related Mortgage Loan Files.

 

(viii)      UCC,
tax and judgment lien searches of Seller.

 

(ix)         If
applicable, UCC terminations or amendments.

 

    	 	Appendix A-1Exhibit 10.3.2

 

AMENDMENT NO. 2

 

TO

 

CREDIT AND SECURITY AGREEMENT

 

THIS AMENDMENT NO.
2 (this “Amendment”) is entered into as of April [__], 2016, by and among MANHATTAN BRIDGE CAPITAL, INC., a
New York corporation (“Borrower”), the Subsidiary Guarantors signatory hereto (collectively with Borrower, each
a “Loan Party” and collectively, the “Loan Parties) and WEBSTER BUSINESS CREDIT CORPORATION (“Lender”).

 

BACKGROUND

 

Loan Parties and Lender
are parties to a Credit and Security Agreement dated as of February 27, 2015 (as amended, restated, supplemented or otherwise modified
from time to time, the “Credit Agreement”) pursuant to which Lender provides Loan Parties with certain financial
accommodations.

 

Borrower intends to
form a wholly-owned subsidiary for the purpose of selling up to $9,990,000 aggregate principal amount of senior secured notes pursuant
to the Permitted Bond Indenture (as defined below) in a registered public offering underwritten by Aegis Capital Corp. (“Aegis”).
The offer and sale of the senior secured notes was consented to by Lender pursuant to that certain consent letter dated November
24, 2015 (the “Consent Agreement”). In the Consent Agreement, Lender agreed to (i) release its security interest
in certain Collateral; and (ii) make certain amendments to the Credit Agreement prior to the issuance of the senior secured notes.
This Amendment shall effect items (i) and (ii) above on the terms and conditions hereafter set forth.

 

NOW, THEREFORE, in
consideration of any loan or advance or grant of credit heretofore or hereafter made to or for the account of each Loan Party by
Lender, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties
hereto hereby agree as follows:

 

1.
           Definitions. All capitalized terms not otherwise defined herein shall have
the meanings given to them in the Credit Agreement.

 

2.            Amendment
to Credit Agreement. Subject to satisfaction of the conditions precedent set forth in Section 4 below, the Credit Agreement
is hereby amended as follows:

 

(a)       Section
4.3 is hereby amended by (i) adding an “(a)” before the text thereof (such that the text currently in the Loan Agreement
is subsection (a) of Section 4.3); and (ii) adding new subsections (b), (c) and (d) which provide as follows:

 

    	 	 	 

     

    

 

“(b)       In
the event that Borrower notifies Lender that it is anticipating a sale by Borrower of a Mortgage Note and the assignment of the
associated Mortgage Loan and other Mortgage Loan Documents to Bond Subsidiary in accordance with Section 7.11(v) hereof and upon
satisfaction of each of the requirements thereof, including, without limitation, the Sale Conditions, Lender shall forward the
applicable Mortgage Note and associated Mortgage Loan Documents endorsed back to the applicable Loan Party, together with the reassignment
to Borrower of the related Mortgage File and any collateral securing such Mortgage Note (collectively, the “Transferred
Mortgage File”). In the event such Transferred Mortgage File is not sold and assigned to Bond Subsidiary within fifteen
(15) Business Days after receipt by Borrower of such Transferred Mortgage File, Borrower shall re-endorse to and return to Lender,
such Transferred Mortgage File.

 

(c)       In
the event that Borrower notifies Lender that it intends to exchange a Mortgage Note and the associated Mortgage Loan and other
Mortgage Loan Documents held by Borrower with a Mortgage Note and the associated Mortgage Loans and other Mortgage Loan Documents
held by Bond Subsidiary in accordance with Section 7.11(vi) hereof and upon satisfaction of each of the requirements thereof, including,
without limitation, the Exchange Conditions, Lender shall forward the applicable Transferred Mortgage File in the manner provided
in Section 4.3(b) hereof. In the event such Transferred Mortgage File is not exchanged with Bond Subsidiary as provided hereunder
within fifteen (15) Business Days after receipt by Borrower of such Transferred Mortgage File, Borrower shall re-endorse to and
return to Lender, such Transferred Mortgage File.

 

(d)       With
regard to any sales described in Section 4.3(b) or any exchanges described in Section 4.3(c), each Loan Party (and by its acceptance
of the Transferred Mortgage File, the Bond Subsidiary) acknowledges and agrees that Lender does not make any oral or written representations,
warranties, promises or guarantees whatsoever, whether express or implied, concerning or with regard to, and Lender expressly disclaims
any liability or obligation with respect to, concerning or relating to any aspect of the Mortgage Loans or any collateral thereof,
including, without limitation, any of the following: (i) the value, condition or profitability of the Mortgaged Property; (ii)
title or ownership to or of the Mortgaged Property, or any portion or part thereof; (iii) governmental laws and any other restrictions
applicable to the Mortgaged Property; (iv) claims by third parties against Borrower or any Mortgage Customer; (v) the creditworthiness,
financial condition or ability of any Mortgage Customer or any guarantor to fulfill its obligations to pay its respective debts
as they mature; (vi) the collectability of the Mortgage Loans; (vii) the legality, validity, sufficiency or enforceability of any
of the Mortgage Loan Documents, and (viii) the validity, enforceability, attachment, priority or perfection of any security interest
granted pursuant to the Mortgage Loan Documents. Loan Parties (and by its acceptance of the Transferred Mortgage File, the Bond
Subsidiary) shall not be entitled to any other materials from Lender, including, but not limited to, materials that are attorney-client
privileged, or prepared in connection with anticipated or actual litigation, or otherwise subject to confidentiality agreements,
internal memoranda, analysis, ratings or reports prepared by Lender in connection with the Mortgage Loans or the transactions completed
by the Credit Agreement. Each Loan Party (and by its acceptance of the Transferred Mortgage File, the Bond Subsidiary) acknowledges
that it will have made such examinations, reviews and investigations as it deems necessary or appropriate in making its decision
to purchase the Mortgage Loans. Each Loan Party (and by its acceptance of the Transferred Mortgage File, the Bond Subsidiary) has
been and will continue to be solely responsible for making its own independent investigation of the Mortgage Loan Documents. Each
Loan Party (and by its acceptance of the Transferred Mortgage File, the Bond Subsidiary) further acknowledges and agrees that Lender
has not given any investment advice, credit information or opinion on whether the purchase of the Mortgage Customers obligations
under the Mortgage Loans is prudent. Each Loan Party (and by its acceptance of the Transferred Mortgage File, the Bond Subsidiary)
hereby accepts the Mortgage Loans on an “as is, where is, with all faults” basis, without recourse to Lender and without
any representations or warranties. Each Loan Party (and by its acceptance of the Transferred Mortgage File, the Bond Subsidiary)
shall defend and indemnify Lender, and its respective employees, agents, directors and officers harmless from and against all loss,
liability, damage and expense, claims, costs, fines and penalties, including attorney’s fees, suffered or incurred as a result
of or in any way related to the transfer of a Transferred Mortgage Property in accordance with the provisions of Section 16.5 hereof.”

 

    	 	 	 

     

    

 

(b)          Section
7.2 is hereby amended by adding “or Section 7.11 (as amended hereby)” between “4.3” and “hereof”
thereof.

 

(c)          Section
7.4 is hereby amended in its entirety to read as follows:

 

“7.4       Guarantees.
Become liable upon the obligations of any Person by assumption, endorsement or guaranty thereof or otherwise (other than to the
Lender, the Bank, the Issuers, or the Lender in connection with this Agreement and the transactions contemplated herein) except
(a) guarantees made in the Ordinary Course of Business up to an aggregate amount not exceeding the Materiality Threshold;
(b) the endorsement of checks for collection in the Ordinary Course of Business; (c) guarantees made by one Loan Party
of the Obligations of another Loan Party or Loan Parties, and (d) the Permitted Bond Subsidiary Guaranty.”

 

(d)          Section
7.5 is hereby amended in its entirety to read as follows:

 

“7.5       Investments.
Purchase or acquire obligations or Equity Interests of, or any other interest in, any Person, including, without limitation the
acquisition of all, or substantially all, or any material portion of the assets or Equity Interests of a Person or the assets of
(a) any division or line of business of a Person and (b) any partnership or joint venture; provided, however, in
Lender’s sole and absolute discretion and so long as (i) there does not exist a Default or Event of Default or a Default
or Event of Default would not result therefrom and (ii) such investment is made by no later than April 30, 2016, Borrower may make
a one-time investment of up to $2,000,000 (whether in cash or in other property) in the Bond Subsidiary to consummate a Permitted
Bond Transaction (a “Permitted Bond Subsidiary Investment”).”

 

    	 	 	 

     

    

 

(e)          Section
7.11 is hereby amended by (i) deleting the word “and” immediately before subsection (iv) thereof and (ii) deleting
the “.” and adding the following text to the end thereof:

 

“, (v) sales by Borrower
of Mortgage Notes and assignment of the associated Mortgage Loans and other Mortgage Loan Documents to Bond Subsidiary, provided,
that, (A) each such sale shall be at the then current outstanding principal amount of the Mortgage Note, (B) all proceeds received
by Borrower in respect of such sales shall be applied in repayment of the outstanding Revolving Advances, and (C) both before and
after giving effect to each such transaction, no Default or Event of Default shall have occurred and be continuing (the conditions
listed in Section 7.11(v)(A) through (C), collectively referred to as the “Sale Conditions”), and (vi) exchanges
between Borrower and Bond Subsidiary of Mortgage Notes and associated Mortgage Loans and other Mortgage Loan Documents, provided,
that (A) each such exchange is on a dollar for dollar basis, (B) the aggregate outstanding principal amount owing on all Mortgage
Notes exchanged by Borrower during any Fiscal Year shall not exceed $1,000,000; provided, that, in the event the aggregate outstanding
principal amount owing on all Mortgage Notes exchanged by Borrower during any Fiscal Year is less than $1,000,000, then one hundred
percent (100%) of the unused amount (the “Carryover Amount”) may be carried over and used in the immediately
succeeding Fiscal Year; provided, further, that any Carryover Amount shall be deemed to be the first amount exchanged in such succeeding
Fiscal Year, (C) the aggregate outstanding principal amount owing on all Mortgage Notes exchanged by Borrower during the Term shall
not exceed $1,250,000, (D) after the exchange, the sum of (i) the Borrowing Base, minus (ii) the sum of the outstanding amount
of Revolving Advances, plus (iii) all amounts due and owing to Loan Parties’ trade creditors which are outstanding beyond
normal trade terms, plus (iv) all fees and expenses for which Loan Parties are liable hereunder but which have not been paid or
charged to Borrower’s Account shall be greater than $1,000,000, and (E) both before and after giving effect to each such
transaction, no Default or Event of Default shall have occurred and be continuing (the conditions listed in Section 7.11(vi)(A)
through (E), collectively referred to as the “Exchange Conditions”).”

 

    	 	 	 

     

    

 

(f)           Annex
One of the Credit Agreement is hereby amended by adding the following definitions in their appropriate order to read as follows:

 

“Consent
Agreement” means that certain consent letter by and between Borrower and Lender, dated November 24, 2015.

 

“Permitted Bond Subsidiary
Guaranty” shall mean that certain Guaranty dated as of [_________] [__], 2016 made by Borrower in favor of the bondholders
with respect to the Bond Subsidiary’s obligation under the Permitted Bond Transaction Documentation.

 

“Permitted Bond Indenture”
shall mean that certain Indenture, dated [___________][__], 2016, by and among the Bond Subsidiary and Worldwide Stock Transfer,
LLC, as Indenture Trustee.

 

(g)          Annex
One of the Credit Agreement is hereby amended by amending and restating the following definitions in their entirety to read as
follows:

 

“Bond Subsidiary”
shall mean MBC Funding II Corp., a wholly owned subsidiary of MBC formed specifically for the purpose of issuing senior secured
notes in connection with the Permitted Bond Transaction.

 

“Permitted Bond Transaction”
shall mean the issuance by the Bond Subsidiary of up to $9,990,000 aggregate principal amount of senior secured notes pursuant
to the Permitted Bond Indenture having a rate of interest of not more than six percent (6%) per annum, and a maturity date ten
(10) years from the date of issuance.

 

(h)          Subsection
(f) of the definition of “Collateral” in Annex One of the Credit Agreement is hereby amended and restated in its entirety
to read as follows:

 

“(f)       all
Equity Interests of each Domestic Subsidiary other than Bond Subsidiary, and sixty-five percent (65%) of the Equity Interests of
each Foreign Subsidiary;”

 

(i)           Subsection
(k) of the definition of “Permitted Encumbrances” in Annex One of the Credit Agreement is hereby amended and restated
in its entirety to read as follows:

 

    	 	 	 

     

    

 

“(k) Liens upon the Equity
Interests of Bond Subsidiary to secure Borrower’s guaranty obligations under the Permitted Bond Transaction and”

 

(j)           Notwithstanding
Sections 7.18 and 7.19 of the Credit Agreement, nothing contained in the Credit Agreement shall be construed as prohibiting Borrower
from repaying its outstanding short-term indebtedness in the principal amount of $860,620 provided that the funds used to repay
such indebtedness shall first be remitted to Lender and subsequently borrowed as a Revolving Advance under the Credit Agreement.

 

(k)          So
long as Bond Subsidiary uses all of the net proceeds from the registered public offering referred to in the “Background”
section of this Amendment to purchase Mortgage Notes from Borrower, Borrower will not be in breach of Section 7.11(v) of the Credit
Agreement to the extent the outstanding principal balance of the Mortgage Notes sold to Bond Subsidiary thereunder is less than
the gross proceeds of the offering, provided that the net procceds of the offering are in excess of $8,900,000.

 

3.            Release
of Certain Collateral. Subject to satisfaction of the conditions precedent set forth in Section 4, Lender hereby releases its
security interest and lien on the Collateral set forth on Schedule A attached hereto (the “Released Collateral”),
subject to satisfaction of the following conditions: (i) the total value of the Released Collateral shall not exceed $12,000,000;
and (ii) both before and after giving effect to the release of the Released Collateral, Loan Parties shall not be in default of
any of the covenants contained in the Credit Agreement. Upon satisfaction of these conditions, Lender’s security interest
in the Released Collateral shall automatically terminate and Lender shall do such further reasonable acts and things, all at Loan
Parties’ expense, to effect the termination of Lender’s liens upon such Released Collateral. The terms of this provision
shall not affect the security interest of the Lender in any property of the Loan Parties other than the Released Collateral.

 

4.            Conditions
of Effectiveness. This Amendment shall become effective when each of the following conditions precedent shall have been satisfied:

 

(a)          Lender
shall have received a copy of this Amendment executed by each Loan Party with one original executed copy of this Amendment to be
promptly delivered by Loan Parties to Lender.

 

(b)          Lender
shall have received a Guaranty from the Bond Subsidiary in form and substance satisfactory to Lender.

 

(c)          Lender
shall have received a copy of the fully executed Intercreditor Agreement, dated as of the date hereof, by and among Worldwide Stock
Transfer, LLC, as Indenture Trustee and Lender, setting forth various rights under the respective guaranties.

 

(d)          Lender
shall have obtained definitive copies of the Permitted Bond Transaction Documents.

 

    	 	 	 

     

    

 

(e)          Lender
shall have received payment in respect of its legal fees and expenses.

 

5.            Conditions
Subsequent to Effectiveness. Loan Parties shall pay an amendment fee in the amount of $20,000.00, which fee shall be fully
earned and payable on the date of the first issuance of the senior secured notes pursuant to the Permitted Bond Indenture using
the proceeds thereof.

 

6.             Representations
and Warranties. Each Loan Party hereby represents and warrants as follows:

 

(a)          This
Amendment and the Credit Agreement, as amended hereby, constitute legal, valid and binding obligations of each Loan Party and are
enforceable against each Loan Party in accordance with their respective terms.

 

(b)          Upon
the effectiveness of this Amendment, each Loan Party hereby reaffirms all covenants, representations and warranties made in the
Credit Agreement to the extent the same are not amended hereby and agree that all such covenants, representations and warranties
shall be deemed to have been remade as of the effective date of this Amendment.

 

(c)          No
Event of Default or Default has occurred and is continuing or would exist after giving effect to this Amendment.

 

(d)          No
Loan Party has any defense, counterclaim or offset with respect to the Credit Agreement.

 

(e)          The
Permitted Bond Transaction complies in all material respects with the terms and conditions set forth on Schedule A to the Consent
Agreement except that Lender acknowledges that (i) in the description under “Amortization”, “quarterly”
should be changed to “monthly” and (ii) in the description under “Market Trading”, “Nasdaq Global
Market” should be changed to “NYSE MKT”.

 

7.            Covenant
Regarding Permitted Bond Transaction Documentation. Borrower hereby agrees that until the satisfaction in full of the Obligations
and termination of the Credit Agreement, Borrower shall not permit the Bond Subsidiary to amend, supplement, modify or restate
the terms of the Permitted Bond Transaction Documentation in a manner that either (a) increases the interest rate above seven percent
(7%), excluding the imposition of the default rate of interest; (b) extends the stated maturity; or (c) increases the outstanding
aggregate principal amount of the senior secured notes issued pursuant to the Permitted Bond Transaction Documentation.

 

8.            Effect
on the Credit Agreement.

 

(a)          Upon
the effectiveness of Section 2 hereof, each reference in the Credit Agreement to “this Agreement,” “hereunder,”
“hereof,” “herein” or words of like import shall mean and be a reference to the Credit Agreement as amended
hereby.

 

    	 	 	 

     

    

 

(b)          Except
as specifically amended herein, the Credit Agreement, and all other documents, instruments and agreements executed and/or delivered
in connection therewith, shall remain in full force and effect, and are hereby ratified and confirmed.

 

(c)           The
execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of Lender,
nor constitute a waiver of any provision of the Credit Agreement, or any other documents, instruments or agreements executed and/or
delivered under or in connection therewith.

 

9.            Release.
Each of the Loan Parties on behalf of itself and its successors, assigns, and other legal representatives, hereby, (a) jointly
and severally, absolutely, unconditionally and irrevocably releases, remises and forever discharges Lender, and its present and
former shareholders, affiliates, subsidiaries, divisions, predecessors, directors, officers, attorneys, employees, agents and other
representatives and their respective successors and assigns (Lender and all such other parties being hereinafter referred to collectively
as the “Releasees” and individually as a “Releasee”), of and from all demands, actions, causes
of action, suits, covenants, contracts, controversies, agreements, promises, sums of money, accounts, bills, reckonings, damages
and any and all other claims, counterclaims, defenses, rights of set-off, demands and liabilities whatsoever (individually, a “Claim”
and collectively, “Claims”) of every name and nature, known or unknown, suspected or unsuspected, both at law
and in equity, whether liquidated or unliquidated, matured or unmatured, asserted or unasserted, fixed or contingent, foreseen
or unforeseen and anticipated or unanticipated, which each of the Loan Parties, or any of their respective successors, assigns,
or other legal representatives and their successors and assigns may now or hereafter own, hold, have or claim to have against the
Releasees or any of them for, upon, or by reason of any nature, cause or thing whatsoever which arises at any time on or prior
to the day and date of this Amendment, in relation to, or in any way in connection with the Credit Agreement, as amended and supplemented
through the date hereof, this Amendment, the Other Documents or the release of the Released Collateral; (b) understands, acknowledges
and agrees that the release set forth above may be pleaded as a full and complete defense and may be used as a basis for an injunction
against any action, suit or other proceeding which may be instituted, prosecuted or attempted in breach of the provisions of such
release; (c) agrees that no fact, event, circumstance, evidence or transaction which could now be asserted or which may hereafter
be discovered shall affect in any manner the final and unconditional nature of the release set forth above and nothing contained
herein shall constitute an admission of liability with respect to any Claim on the part of any Releasee; and (d) jointly and severally,
absolutely, unconditionally and irrevocably, covenants and agrees with each Releasee that it will not sue (at law, in equity, in
any regulatory proceeding or otherwise) any Releasee on the basis of any Claim released, remised and discharged by any of the Loan
Parties pursuant to this Paragraph 8. If any Loan Party violates the foregoing covenant, Loan Parties, jointly and severally, agree
to pay, in addition to such other damages as any Releasee may sustain as a result of such violation, all attorneys' fees and costs
incurred by any Releasee as a result of such violation.

 

10.           Governing
Law. This Amendment shall be binding upon and inure to the benefit of the parties hereto and their respective successors and
assigns and shall be governed by and construed in accordance with the laws of the State of New York.

 

    	 	 	 

     

    

 

11.           Headings.
Section headings in this Amendment are included herein for convenience of reference only and shall not constitute a part of this
Amendment for any other purpose.

 

12.           Counterparts;
Facsimile. This Amendment may be executed by the parties hereto in one or more counterparts, each of which shall be deemed
an original and all of which when taken together shall constitute one and the same agreement. Any signature delivered by a party
by .pdf or facsimile transmission shall be deemed to be an original signature hereto.

 

[Signature Page to Follow]

 

    	 	 	 

     

    

 

IN WITNESS WHEREOF,
this Amendment has been duly executed as of the day and year first written above.

 

	 	“BORROWER”
	 	 
	 	MANHATTAN BRIDGE CAPITAL, INC.
	 	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 
	 	 	 
	 	“SUBSIDIARY GUARANTOR”
	 	 
	 	DAG FUNDING SOLUTIONS, INC.
	 	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 

 

Signature Page to Amendment No. 2

 

    	 	 	 

     

    

 

	 	WEBSTER BUSINESS CREDIT CORPORATION
	 	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 

 

Signature Page to Amendment No. 2

 

    	 	 	 

     

    

 

Schedule A

Released Mortgage Loans

(Not to exceed $12,000,000)

 

Schedule A

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