Document:

EXHIBIT 10.5

 

FORM OF

 

TAX RECEIVABLE AGREEMENT

 

by and
among

 

Fifth
Street Asset Management Inc., 

Fifth
Street Holdings L.P.,

Leonard
M. Tannenbaum,

Bernard
D. Berman and

Ivelin
M. Dimitrov

 

dated as of September , 2014

 

    	 

    	 

    

 

TABLE OF CONTENTS

 

	 	 	PAGE
	 	 	 
	ARTICLE 1
	DEFINITIONS
	 	 	 
	Section 1.01	Definitions	2
	Section 1.02	Other Definitional and Interpretative Provisions	9
	 	 	 
	ARTICLE 2
	DETERMINATION OF CUMULATIVE REALIZED TAX BENEFIT
	 	 	 
	Section 2.01	Basis Adjustment	9
	Section 2.02	Exchange Basis Schedule	9
	Section 2.03	Tax Benefit Schedule	9
	Section 2.04	Procedures, Amendments	9
	 	 	 
	ARTICLE 3
	TAX BENEFIT PAYMENTS
	 	 	 
	Section 3.01	Payments	10
	Section 3.02	No Duplicative Payments	11
	Section 3.03	Pro Rata Payments	11
	 	 	 
	ARTICLE 4
	TERMINATION
	 	 	 
	Section 4.01	Early Termination and Breach of Agreement	11
	Section 4.02	Early Termination Notice	12
	Section 4.03	Payment upon Early Termination	12
	 	 	 
	ARTICLE 5
	SUBORDINATION AND LATE PAYMENTS
	 	 	 
	Section 5.01	Late Payments by the Corporation	13
	 	 	 
	ARTICLE 6
	NO DISPUTES; CONSISTENCY; COOPERATION
	 	 	 
	Section 6.01	Principal Participation in the Corporation and Holding’s Tax Matters	13
	Section 6.02	Consistency	13
	Section 6.03	Cooperation	14

 

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	ARTICLE 7
	MISCELLANEOUS
	 	 	 
	Section 7.01	Notices	14
	Section 7.02	Counterparts	14
	Section 7.03	Entire Agreement; No Third-Party Beneficiaries	15
	Section 7.04	Governing Law	15
	Section 7.05	Severability	15
	Section 7.06	Successors; Assignment; Amendments; and Waivers	15
	Section 7.07	Titles and Subtitles	16
	Section 7.08	Resolution of Disputes	17
	Section 7.09	Reconciliation	18
	Section 7.10	Withholding	19
	Section 7.11	Admission of the Corporation into a Consolidated Group; Transfers of Corporate Assets	19
	Section 7.12	Confidentiality	19
	Section 7.13	Partnerships	20

 

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TAX RECEIVABLE AGREEMENT

 

This TAX RECEIVABLE AGREEMENT (as amended
from time to time, this “Agreement”), dated as of September , 2014, is hereby entered into by and among Fifth
Street Asset Management Inc. (the “Corporation”), Fifth Street Holdings L.P., (“Holdings”),
Leonard M. Tannenbaum, Bernard D. Berman and Ivelin M. Dimitrov.

 

RECITALS

 

WHEREAS, the Principals (as defined below)
are, or in connection with the IPO will become, limited partners of Holdings, and they and the other limited partners of Holdings
hold or will hold Class A Units (“Units”) in Holdings.

 

WHEREAS, Holdings is treated as a partnership
for U.S. federal income tax purposes;

 

WHEREAS, the Corporation will become the
general partner of, and will hold Units in, Holdings;

 

WHEREAS, the Principals and certain other
limited partners of Holdings will sell Units to the Corporation pursuant to the IPO (as defined below);

 

WHEREAS, at certain times subsequent to
the IPO, the Units will be exchangeable for Class A common stock of the Corporation, par value $0.01 per share (“Class
A Shares”) or money, pursuant to the Exchange Agreement (as defined below);

 

WHEREAS, as a result of any Person’s
exchanging Units either for money or Class A Shares pursuant to the IPO or the Exchange Agreement (each such transaction, an “Exchange”)
and of the Principals’ agreeing to hold Units rather than transfer all of their Units in exchange for shares of Class A Shares,
the Corporation is expected to incur lower Tax (as defined below) liabilities on an ongoing basis with respect to the operations
of Holdings and its subsidiaries;

 

WHEREAS, Holdings will have in effect an
election under Section 754 of the Internal Revenue Code of 1986, as amended (the “Code”), for each Taxable Year
(as defined below) in which an Exchange occurs, which election is intended to result in an adjustment to the Tax basis of the assets
owned by Holdings and certain of its subsidiaries, solely with respect to the Corporation (in respect of Units exchanged); and

 

WHEREAS, the parties to this Agreement desire
to make certain arrangements to share any Tax benefits realized by the Corporation as a result of any Exchange;

 

NOW, THEREFORE, in consideration of the
foregoing and the respective covenants and agreements set forth herein and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, the parties hereto agree as follows:

 

    	 

    	 

    

 

Article
1

DEFINITIONS

 

Section 1.01         Definitions.
As used in this Agreement, the terms set forth in this Article 1 shall have the following meanings (such meanings to be equally
applicable to both the singular and plural forms of the terms defined):

 

“Advisory Firm” means
PricewaterhouseCoopers LLP (“PwC”) or any other accounting firm that is nationally recognized as being expert in Tax
matters and that is appointed by the Board and is reasonably acceptable to the Principals.

 

“Advisory Firm Letter”
means a letter from the Advisory Firm stating that the relevant schedule, notice or other information to be provided by the Corporation
to the Applicable Principal and all supporting schedules and work papers were prepared by the Corporation in good faith and, to
the extent not expressly provided in this Agreement, on a reasonable basis in light of the facts and law in existence on the date
such schedule, notice or other information is delivered or made available to the Principals.

 

“Affiliate” means, with
respect to any Person, any other Person that directly or indirectly, through one or more intermediaries, Controls (as defined below),
is Controlled by, or is under common Control with, such first Person.

 

“Agreed Rate” means LIBOR
plus 100 basis points.

 

“Agreement” is defined
in the preamble of this Agreement.

 

“Amended Schedule” is
defined in Section 2.04(b).

 

“Applicable Principal”
means in respect of that portion of any Tax Benefit Payment that arises from (i) an Exchange or (ii) a deemed Exchange pursuant
to clause (v) of the definition of “Valuation Assumptions”, the exchanging Principal or Principal deemed to
Exchange, as applicable.

 

“Basis Adjustment” means
the adjustment to the Tax basis of an Exchange Asset as a result of an Exchange and the payments made pursuant to this Agreement,
as calculated under Section 2.01, under Sections 732(b), 734(b), 743(b), 754, 755 and 1012 of the Code or otherwise, as applicable,
and, in each case, comparable sections of state, local and foreign Tax laws. Notwithstanding any other provision of this Agreement,
the amount of any Basis Adjustment resulting from an Exchange of one or more Units shall be determined without regard to any Pre-Exchange
Transfer of such Units and as if any such Pre-Exchange Transfer had not occurred.

 

A “Beneficial Owner”
of a security means a Person who directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise,
has or shares: (i) voting power, which includes the power to vote, or to direct the voting of, such security and/or (ii) investment
power, which includes the power to dispose of, or to direct the disposition of, such security. The terms “Beneficially
Own” and “Beneficial Ownership” shall have correlative meanings.

 

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“Board” means the board
of directors of the Corporation.

 

“Business Day” means
Monday through Friday of each week, except that a legal holiday recognized as such by the government of the United States of America
or the State of New York shall not be regarded as a Business Day.

 

“Change of Control” means
the occurrence of any of the following events:

 

(i)          any
“person” or “group” (as such terms are defined in Sections 13(d) and 14(d) of the Exchange Act) other than
the Principals and their Affiliates:

 

(A)         is
or becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly,
of 50% or more of the voting power of the voting stock of the Corporation;

 

(B)         in
the context of a consolidation, merger or other corporate reorganization in which the Corporation is not the surviving entity,
acquires 50% or more of the voting power of the voting stock generally entitled to elect directors of such surviving entity (or
in the case of a triangular merger, of the parent entity of such surviving entity), calculated on a fully diluted basis; or

 

(C)         has
obtained the power (whether or not exercised) to elect a majority of the directors of the Corporation or its successors;

 

(ii)         the
board of directors of the Corporation or its successors shall cease to consist of a majority of Continuing Directors;

 

(iii)        the
Corporation or its successors, alone or together with the Principals and their respective Affiliates, cease to own 50% or more
of the equity interests of Holdings; or

 

(iv)        the
sale of all or substantially all the assets of the Corporation or Holdings.

 

“Class A Shares” is defined
in the Recitals of this Agreement.

 

“Code” is defined in
the Recitals of this Agreement.

 

“Continuing Directors”
means the directors of the Corporation on the date of the pricing of the IPO and each other director of the Corporation if such
director’s election or nomination for election to the Corporation’s board of directors is approved by a majority of
the then Continuing Directors.

 

“Control” means the possession,
direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether through ownership
of voting securities, by contract or otherwise.

 

“Corporation” is defined
in the Preamble of this Agreement.

 

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“Corporation Return”
means the U.S. federal, state, local and/or foreign Tax Return, as applicable, of the Corporation filed with respect to Taxes for
any Taxable Year.

 

“Cumulative Net Realized Tax Benefit”
for a Taxable Year means the cumulative amount of Realized Tax Benefits for all Taxable Years of the Corporation, up to and including
such Taxable Year, net of the cumulative amount of Realized Tax Detriments for the same period. The Realized Tax Benefit and Realized
Tax Detriment for each Taxable Year shall be determined based on the most recent Tax Benefit Schedule or Amended Schedule, if any,
in existence at the time of such determination.

 

“Default Rate” means
LIBOR plus 500 basis points.

 

“Determination” shall
have the meaning ascribed to such term in Section 1313(a) of the Code or similar provision of state, local and foreign Tax law,
as applicable, or any other event that finally and conclusively establishes the amount of any liability for Tax.

 

“Dispute” is defined
in Section 7.08(a).

 

“Early Termination Date”
means the date of an Early Termination Notice for purposes of determining the Early Termination Payment.

 

“Early Termination Notice”
is defined in Section 4.02.

 

“Early Termination Schedule”
is defined in Section 4.02.

 

“Early Termination Payment”
is defined in Section 4.03(b).

 

“Early Termination Rate”
means the lessor of (i) 6.50% and (ii) the Agreed Rate.

 

“Exchange” is defined
in the Recitals of this Agreement; “Exchanged” and “Exchanging” shall have correlative meanings.

 

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

 

“Exchange Agreement”
means the Exchange Agreement by and among the Corporation, Holdings and the limited partners of Holdings, including the Principals,
as the same may be amended from time to time in accordance with the terms thereof.

 

“Exchange Assets” means
each asset that is held by Holdings, or by any of its direct or indirect subsidiaries that is treated as a partnership or disregarded
entity for purposes of the applicable Tax, at the time of an Exchange (including, for the avoidance of doubt, goodwill and going
concern value).

 

“Exchange Basis Schedule”
is defined in Section 2.02.

 

“Exchange Date” means
the date of an Exchange.

 

“Exchange Payment” means
any Tax Benefit Payment or Early Termination Payment required to be made by the Corporation to the Principals under this Agreement.

 

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“Exchange Price” means
the value of Class A Shares, cash or other consideration transferred to a holder of Units pursuant to an Exchange as payment for
the exchanged Units, other than amounts payable pursuant to this Agreement.

 

“Expert” is defined in
Section 7.09.

 

“Hypothetical Tax Liability”
means, with respect to any Taxable Year, the liability for Taxes of the Corporation (or Holdings, but only with respect to income
realized by Holdings the Tax liability for which is allocable to the Corporation for such Taxable Year using the same methods,
elections, conventions and similar practices used on the relevant Corporation Return) but using the Non-Stepped Up Tax Basis instead
of the Tax basis of the Exchange Assets and excluding any deduction attributable to Imputed Interest.

 

“Imputed Interest” shall
mean any interest imputed under Section 1272, 1274 or 483 or other provision of the Code and any similar provision of state, local
and foreign Tax law with respect to the Corporation’s payment obligations under this Agreement.

 

“Initiating Party” is
defined in Section 7.08(a).

 

“IPO” means the initial
public offering of the Class A Shares, as contemplated by the Corporation’s Registration Statement on Form S-1 (File No.
333-198613).

 

“IRS” means the U.S.
Internal Revenue Service.

 

“LIBOR” means for each
month (or portion thereof) during any period, an interest rate per annum equal to the rate per annum reported, on the date two
days prior to the first day of such month, as published by Reuters (or other commercially available source providing quotations
of LIBOR) for London interbank offered rates for U.S. dollar deposits for such month (or portion thereof).

 

“Market Value” means,
with respect to the Class A Shares, on any given date: (i) if the Class A Shares are listed for trading on the NASDAQ Stock Market,
the closing sale price per share of the Class A Shares on the NASDAQ Stock Market on that date (or, if no closing sale price is
reported, the last reported sale price), (ii) if the Class A Shares are not listed for trading on the NASDAQ Stock Market, the
closing sale price (or, if no closing sale price is reported, the last reported sale price) as reported on that date in composite
transactions for the principal national securities exchange registered pursuant to Section 6(g) of the Exchange Act, on which the
Class A Shares are listed, (iii) if the Class A Shares are not so listed on a national securities exchange, the last quoted bid
price for the Class A Shares on that date in the over-the-counter market as reported by Pink Sheets LLC or a similar organization,
or (iv) if the Class A Shares are not so quoted by Pink Sheets LLC or a similar organization such value as the Board, in its sole
discretion, shall determine in good faith.

 

“Material Objection Notice”
has the meaning set forth in Section 4.02.

 

“Non-Stepped Up Tax Basis”
means, with respect to any asset at any time, the Tax basis that such asset would have had at such time if no Basis Adjustment
had been made.

 

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“Notice” is defined in
Section 7.01.

 

“Objection Notice” is
defined in Section 2.04(a).

 

“Panel” is defined in
Section 7.08(a).

 

“Partnership Agreement”
means the Amended and Restated Limited Partnership Agreement of Holdings, as the same may be amended from time to time in accordance
with the terms thereof.

 

“Payment Date” means
any date on which a payment is required to be made pursuant to this Agreement.

 

“Person” means any individual,
corporation, firm, partnership, joint venture, limited liability company, estate, trust, business association, organization, governmental
entity or other entity.

 

“Pre-Exchange Transfer”
means any direct or indirect transfer (including upon the death of a member) of one or more Units (i) that occurs prior to an Exchange
of such Units and (ii) to which either Section 734(b) or Section 743(b) of the Code applies.

 

“Principal” means each
of Leonard M. Tannenbaum, Bernard D. Berman and Ivelin M. Dimitrov, and any other Person that becomes a Principal pursuant to Section
7.06.

 

“Realized Tax Benefit”
means, for a Taxable Year and for all Taxes collectively, the net excess, if any, of the Hypothetical Tax Liability over the actual
liability for Taxes of the Corporation (or Holdings, but only with respect to income realized by Holdings the Tax liability for
which is allocable to the Corporation for such Taxable Year using the same methods, elections, conventions and similar practices
used on the relevant Corporation Return), determined, for the avoidance of doubt, using the “with or without” methodology.
If all or a portion of the actual liability for Taxes of the Corporation (or Holdings, but only with respect to income realized
by Holdings the Tax liability for which is allocable to the Corporation for such Taxable Year using the same methods, elections,
conventions and similar practices used on the relevant Corporation Return) for the Taxable Year arises as a result of an audit
by a Taxing Authority of any Taxable Year, the portion of such liability attributable to such audit shall not be included in determining
the Realized Tax Benefit unless and until there has been a Determination.

 

“Realized Tax Detriment”
means, for a Taxable Year and for all Taxes collectively, the net excess, if any, of the actual liability for Taxes of the Corporation
(or Holdings, but only with respect to income realized by Holdings the Tax liability for which is allocable to the Corporation
for such Taxable Year using the same methods, elections, conventions and similar practices used on the relevant Corporation Return)
over the Hypothetical Tax Liability for such Taxable Year determined, for the avoidance of doubt, using the “with or without”
methodology. If all or a portion of the actual liability for Taxes of the Corporation (or Holdings, but only with respect to income
realized by Holdings the Tax liability for which is allocable to the Corporation for such Taxable Year using the same methods,
elections, conventions and similar practices used on the relevant Corporation Return) for the Taxable Year arises as a result of
an audit by a Taxing Authority of any Taxable Year, the portion of such liability attributable to such audit shall not be included
in determining the Realized Tax Detriment unless and until there has been a Determination.

 

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“Reconciliation Dispute”
has the meaning set forth in Section 7.09.

 

“Reconciliation Procedures”
means those procedures set forth in Section 7.09.

 

“Responding Party” is
defined in Section 7.08(a).

 

“Schedule” means any
Exchange Basis Schedule or Tax Benefit Schedule and the Early Termination Schedule.

 

“Subsidiaries” means,
with respect to any Person, as of any date of determination, any other Person as to which such Person, owns, directly or indirectly,
or otherwise controls more than 50% of the voting shares or other similar interests or the sole general partner interest or managing
member or similar interest of such Person.

 

“Tax” means any and all
U.S. federal, state, local and foreign tax, assessments or similar charges that are based on or measured with respect to net income
or profits, whether as an exclusive or on an alternative basis, and any interest related to such tax.

 

“Tax Benefit Payment”
is defined in Section 3.01(b).

 

“Tax Benefit Schedule”
is defined in Section 2.03.

 

“Tax Return” means any
return, declaration, report or similar statement required to be filed with respect to Taxes (including any attached schedules),
including any information return, claim for refund, amended return and declaration of estimated Tax.

 

“Taxable Year” means
a taxable year of the Corporation as defined in Section 441(b) of the Code or comparable section of state, local or foreign Tax
law, as applicable (and, therefore, for the avoidance of doubt, may include a period of less than 12 months for which a Tax Return
is prepared), in which there is a Basis Adjustment attributable to an Exchange.

 

“Taxing Authority” means
any domestic, foreign, federal, national, state, county or municipal or other local government, any subdivision, agency, commission
or authority thereof, or any quasi-governmental body exercising any Taxing authority or any other authority exercising Tax regulatory
authority.

 

“Treasury Regulations”
means the final, temporary and proposed regulations under the Code promulgated from time to time (including corresponding provisions
and succeeding provisions) as in effect for the relevant taxable period.

 

“Units” is defined in
the Recitals of this Agreement.

 

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“Valuation Assumptions”
means, as of an Early Termination Date, or following a Change of Control, as applicable, the assumptions that (i) in each Taxable
Year ending on or after such Early Termination Date, the Corporation will have sufficient taxable income to fully utilize the deductions
in such Taxable Year attributable to any Basis Adjustment attributable to an Exchange, and Imputed Interest, (ii) the U.S.
federal income tax rates and state, local and foreign income tax rates that will be in effect for each such Taxable Year will be
those specified for each such Taxable Year by the Code and other law as in effect on the Early Termination Date, (iii) any loss
carryovers generated by any Basis Adjustment or Imputed Interest and available as of the date of the Early Termination Schedule
will be used by the Corporation on a pro rata basis from the date of the Early Termination Schedule through the scheduled expiration
date of such loss carryovers, (iv) any non-amortizable assets will be disposed of on the fifteenth anniversary of the Early
Termination Date, provided, however, that, in the event of a Change of Control, non-amortizable assets shall be deemed
disposed of at the earlier of (A) the time of sale of the relevant asset and (B) as generally provided in clause (iv) of this definition
of Valuation Assumptions and (v) if, at the Early Termination Date, there are Units that have not been Exchanged, then each such
Unit shall be deemed to be Exchanged for the Market Value of the Class A Shares and the amount of cash that would be transferred
if the Exchange occurred on the Early Termination Date (for the avoidance of doubt, this deemed exchange will be treated as giving
rise to a corresponding Basis Adjustment).

 

Section 1.02         Other
Definitional and Interpretative Provisions. The words “hereof”, “herein” and “hereunder”
and words of like import used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of
this Agreement. References to Articles, Sections, Exhibits and Schedules are to Articles, Sections, Exhibits and Schedules of
this Agreement unless otherwise specified. All Exhibits and Schedules annexed hereto or referred to herein are hereby incorporated
in and made a part of this Agreement as if set forth in full herein. Any capitalized terms used in any Exhibit or Schedule but
not otherwise defined therein, shall have the meaning as defined in this Agreement. Any singular term in this Agreement shall
be deemed to include the plural, and any plural term the singular. Whenever the words “include”, “includes”
or “including” are used in this Agreement, they shall be deemed to be followed by the words “without limitation”,
whether or not they are in fact followed by those words or words of like import. “Writing”, “written”
and comparable terms refer to printing, typing and other means of reproducing words (including electronic media) in a visible
form. References to any agreement or contract are to that agreement or contract as amended, modified or supplemented from time
to time in accordance with the terms thereof. References to any Person include the successors and permitted assigns of that Person.
References from or through any date mean, unless otherwise specified, from and including or through and including, respectively.
Reference to any law, rule or regulation means such law, rule or regulation as amended, modified codified, replaced or reenacted,
in whole or in part, and in effect from time to time, including rules and regulations promulgated thereunder, and reference to
any section or other provision of any law, rule or regulation means that provision of such law, rule or regulation from time to
time in effect and constituting the substantive amendment, modification, codification, replacement or reenactment of such section
or other provision.

 

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Article
2

DETERMINATION OF CUMULATIVE REALIZED TAX BENEFIT

 

Section 2.01         Basis
Adjustment.

 

(a)          Exchange
Assets. For purposes of this Agreement, as a result of an Exchange, Holdings (and each direct and indirect subsidiary of Holdings
that is treated as a partnership for U.S. federal income tax purposes) shall be entitled to a Basis Adjustment for each Exchange
Asset with respect to the Corporation.

 

(b)          Imputed
Interest. For the avoidance of doubt, payments made under this Agreement shall not be treated as resulting in a Basis Adjustment
to the extent such payments are treated as Imputed Interest.

 

Section 2.02         Exchange
Basis Schedule. Within 45 calendar days after the filing of the U.S. federal income Tax Return of the Corporation for each
Taxable Year, the Corporation shall deliver to each Principal a schedule (the “Exchange Basis Schedule”) that
shows, in reasonable detail, for purposes of federal income Taxes, (a) the actual unadjusted Tax basis of the Exchange Assets
as of each applicable Exchange Date, (b) the Basis Adjustment with respect to the Exchange Assets as a result of the Exchanges
effected in such Taxable Year, calculated in the aggregate, (c) the period or periods, if any, over which the Exchange Assets
are amortizable and/or depreciable and (d) the period or periods, if any, over which each Basis Adjustment is amortizable and/or
depreciable (which, for non-amortizable assets, shall be based on the Valuation Assumptions). The parties expect that substantially
all of the Basis Adjustment with respect to the Exchange Assets will relate to goodwill and/or going concern value, which adjustment
will be amortized over 15 years for U.S. federal income tax purposes.

 

Section 2.03         Tax
Benefit Schedule. Within 45 calendar days after the filing of the U.S. federal income Tax Return of the Corporation
for any Taxable Year in which there is a Realized Tax Benefit or Realized Tax Detriment, the Corporation shall provide to each
Principal a schedule showing, in reasonable detail, the calculation of the Realized Tax Benefit or Realized Tax Detriment for
such Taxable Year (a “Tax Benefit Schedule”). The Tax Benefit Schedule will become final as provided in Section
2.04(a) and may be amended as provided in Section 2.04(b) (subject to the procedures set forth in Section 2.04(b)). Notwithstanding
any other provision of this Agreement, the Corporation may seek, at its own expense, an opinion from a nationally recognized law
firm regarding whether any Basis Adjustment with respect to Exchange Assets will result in any amortization or depreciation being
available to the Corporation, and the Corporation shall be permitted to rely on such opinion in creating any Tax Benefit Schedule.

 

Section 2.04         Procedures,
Amendments.

 

(a)          Procedure.
Every time the Corporation delivers to the Applicable Principal an applicable Schedule under this Agreement, including any Amended
Schedule delivered pursuant to Section 2.04(b), but excluding any Early Termination Schedule or amended Early Termination Schedule,
the Corporation shall also (i) deliver to the Applicable Principal schedules and work papers providing reasonable detail regarding
the preparation of such Schedule and an Advisory Firm Letter supporting such Schedule and (ii) allow the Applicable Principal reasonable
access, at no cost to the Applicable Principal, to the appropriate representatives at the Corporation and the Advisory Firm in
connection with a review of such Schedule. The applicable Schedule shall become final and binding on all parties unless the Applicable
Principal, within 30 calendar days after receiving an Exchange Basis Schedule or amendment thereto or a Tax Benefit Schedule or
amendment thereto, provides the Corporation with notice of a material objection to such Schedule (“Objection Notice”)
made in good faith. If the parties, for any reason, are unable to successfully resolve the issues raised in such notice within
30 calendar days of receipt by the Corporation of an Objection Notice with respect to such Exchange Basis Schedule or Tax Benefit
Schedule, the Corporation and the Applicable Principal shall employ the reconciliation procedures as described in Section 7.09
(the “Reconciliation Procedures”).

 

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(b)          Amended
Schedule. The applicable Schedule for any Taxable Year may be amended from time to time by the Corporation (i) in connection
with a Determination affecting such Schedule, (ii) to correct material inaccuracies in the Schedule identified as a result of the
receipt of additional factual information relating to a Taxable Year after the date the Schedule was provided to the Applicable
Principal, (iii) to comply with the Expert’s determination under the Reconciliation Procedures, (iv) to reflect a material
change in the Realized Tax Benefit or Realized Tax Detriment for such Taxable Year attributable to a carryback or carryforward
of a loss or other Tax item to such Taxable Year, (v) to reflect a material change in the Realized Tax Benefit or Realized Tax
Detriment for such Taxable Year attributable to an amended Tax Return filed for such Taxable Year, or (vi) to adjust the Exchange
Basis Schedule to take into account payments made pursuant to this Agreement (such Schedule, an “Amended Schedule”).

 

Article
3

TAX BENEFIT PAYMENTS

 

Section 3.01         Payments.

 

(a)          Within
ten business days of a Tax Benefit Schedule that was delivered to an Applicable Principal becoming final in accordance with Section
2.04(a), the Corporation shall pay to the Applicable Principal for such Taxable Year the Tax Benefit Payment determined pursuant
to Section 3.01(b). Each such Tax Benefit Payment shall be made by wire transfer of immediately available funds to a bank account
of the Applicable Principal previously designated by such Principal to the Corporation. For the avoidance of doubt, no Tax Benefit
Payment shall be made in respect of estimated Tax payments, including U.S. federal income tax payments.

 

(b)          A
“Tax Benefit Payment” means an amount, not less than zero, equal to 85% of the sum of the Net Tax Benefit and
the Interest Amount. The “Net Tax Benefit” for each Taxable Year shall be an amount equal to the excess, if
any, of the Cumulative Net Realized Tax Benefit as of the end of such Taxable Year over the total amount of payments previously
made under this Section 3.01, excluding payments attributable to the Interest Amount; provided, however, that no
Principal (or other recipient of payments under this Agreement) shall be required to return any portion of any previously received
Tax Benefit Payment under any circumstances. The “Interest Amount” for a given Taxable Year shall equal the
interest on the Net Tax Benefit for such Taxable Year calculated at the Agreed Rate from the due date (without regard to extensions)
for filing the Corporation Return with respect to Taxes for the most recently ended Taxable Year until the Payment Date. The Net
Tax Benefit and the Interest Amount shall be determined separately with respect to each separate Exchange; further, if an
Exchange is made by a Principal, the Net Tax Benefit and the Interest Amount therefrom will be paid only to that Principal or its
assignee, whereas if an Exchange is made by a Person other than a Principal, the Net Tax Benefit and the Interest Amount therefrom
will be paid to the Principals or their assignees on a pro rata basis based on the relative Units owned by each Principal. Notwithstanding
the foregoing, for each Taxable Year ending on or after the date of a Change of Control, all Tax Benefit Payments, whether paid
with respect to Units that were Exchanged (i) prior to the date of such Change of Control or (ii) on or after the date of such
Change of Control, shall be calculated by utilizing the assumptions in clauses (i), (iii) and (iv) of the definition of Valuation
Assumptions, substituting in each case the term “the closing date of a Change of Control” for an “Early Termination
Date”. Notwithstanding anything herein to the contrary, in no event shall the aggregate Tax Benefit Payments to any Principal
(other than amounts treated as interest under the Code) in respect of the Exchanges under this Agreement exceed an amount equal
to 85% of the portion of the Exchange Price paid to such Principal pursuant to such Exchanges.

 

    	10

    	 

    

 

Section 3.02         No
Duplicative Payments. It is intended that the provisions of this Agreement will not result in duplicative payment of
any amount (including interest) required under this Agreement. It is also intended that the provisions of this Agreement will
result in 85% of the Corporation’s Cumulative Net Realized Tax Benefit, and the Interest Amount thereon, being paid to the
Principals pursuant to this Agreement. The provisions of this Agreement shall be construed in the appropriate manner so that such
intentions are realized.

 

Section 3.03         Pro
Rata Payments. For the avoidance of doubt, to the extent that (i) the Corporation’s deductions with respect
to any Basis Adjustment are limited in a particular Taxable Year or (ii) the Corporation lacks sufficient funds to satisfy or
is prevented under any credit agreement or other arrangement from satisfying its obligations to make all Tax Benefit Payments
due in a particular Taxable Year, the limitation on the deduction, or the Tax Benefit Payments that may be made, as the case may
be, shall be taken into account or made for the Applicable Principal on a pro rata basis which reflects the proportion of the
total amount of deductions attributable to such Principal relative to the aggregate deductions for all of the Principals (as determined
by the Corporation in good faith and exercising reasonable discretion).

 

Article
4

TERMINATION

 

Section 4.01         Early
Termination and Breach of Agreement.

 

(a)          The
Corporation may terminate this Agreement with respect to all of the Units held (or previously held and Exchanged) by all Principals
at any time by paying to the Principals the Early Termination Payment; provided, however, that this Agreement shall
terminate only upon the receipt of the Early Termination Payment by all Principals, and provided, further, that the
Corporation may withdraw any notice to execute its termination rights under this Section 4.01(a) prior to the time at which
any Early Termination Payment has been paid. Upon payment of the Early Termination Payments by the Corporation, neither the Principals
nor the Corporation shall have any further payment obligations under this Agreement, other than for any (i) Tax Benefit Payment
agreed by the Corporation and the Applicable Principal (each acting in good faith) to be due and payable but unpaid as of the Early
Termination Notice and (ii) Tax Benefit Payment due for the Taxable Year ending with or including the date of the Early Termination
Notice (except to the extent that the amount described in clause (ii) is included in the Early Termination Payment). For the avoidance
of doubt, if an Exchange occurs after the Corporation makes the Early Termination Payments with respect to all Principals, the
Corporation shall have no obligations under this Agreement with respect to such Exchange, and its only obligations under this Agreement
in such case shall be its obligations to all Principals under Section 4.03(a).

 

    	11

    	 

    

 

(b)          In
the event that the Corporation breaches any of its material obligations under this Agreement, whether as a result of failure to
make any payment when due, failure to honor any other material obligation required hereunder or by operation of law as a result
of the rejection of this Agreement in a case commenced under the Bankruptcy Code, Title 11, U.S.C., or otherwise, then all obligations
hereunder shall be accelerated and such obligations shall be calculated as if an Early Termination Notice had been delivered on
the date of such breach and shall include, but shall not be limited to, (i) the Early Termination Payment calculated as if an Early
Termination Notice had been delivered on the date of a breach, (ii) any Tax Benefit Payment agreed by the Corporation acting in
good faith and any Applicable Principal to be due and payable but unpaid as of the date of a breach, and (iii) any Tax Benefit
Payment due for the Taxable Year ending with or including the date of a breach. Notwithstanding the foregoing, in the event that
the Corporation breaches this Agreement, the Principals shall be entitled to elect to receive the amounts set forth in clauses
(i), (ii) and (iii) above or to seek specific performance of the terms hereof. The parties agree that the failure to make any payment
due pursuant to this Agreement within three months of the date such payment is due shall be deemed to be a breach of a material
obligation under this Agreement for all purposes of this Agreement, and that it shall not be considered to be a breach of a material
obligation under this Agreement to make a payment due pursuant to this Agreement within three months of the date such payment is
due.

 

(c)          The
Corporation, Holdings and each of the Principals hereby acknowledge that, as of the date of this Agreement, the aggregate value
of the Tax Benefit Payments cannot reasonably be ascertained for U.S. federal income tax or other applicable Tax purposes.

 

Section 4.02         Early
Termination Notice. If the Corporation chooses to exercise its right of early termination under Section 4.01 above,
the Corporation shall deliver to each present or former Principal a notice of such intention to exercise such right (“Early
Termination Notice”) and a schedule (the “Early Termination Schedule”) specifying the Corporation’s
intention to exercise such right and showing in reasonable detail the calculation of the Early Termination Payment. The Early
Termination Schedule shall become final and binding on all parties unless an Applicable Principal, within 30 calendar days after
receiving the Early Termination Schedule, provides the Corporation with notice of a material objection to such Schedule made in
good faith (“Material Objection Notice”). If the parties, for any reason, are unable to successfully resolve
the issues raised in such notice within 30 calendar days after receipt by the Corporation of the Material Objection Notice, the
Corporation and the relevant Principal shall employ the Reconciliation Procedures as described in Section 7.09 of this Agreement.

 

Section 4.03         Payment
upon Early Termination.

 

(a)          Within
ten Business Days after the Early Termination Schedule has become final and binding, the Corporation shall pay to each Applicable
Principal an amount equal to the Early Termination Payment. Such payment shall be made by wire transfer of immediately available
funds to a bank account designated by the Applicable Principal.

 

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(b)          The
“Early Termination Payment” as of the date of the delivery of an Early Termination Schedule shall equal with
respect to the Applicable Principal the present value, discounted at the Early Termination Rate as of such date, of all Tax Benefit
Payments that would be required to be paid by the Corporation to the Applicable Principal beginning from the Early Termination
Date and assuming that the Valuation Assumptions are applied.

 

Article
5

SUBORDINATION AND LATE PAYMENTS

 

Section 5.01         Late
Payments by the Corporation. The amount of all or any portion of any Exchange Payment not made to any Principal when
due under the terms of this Agreement shall be payable together with any interest thereon, computed at the Default Rate and commencing
from the date on which such Exchange Payment was due and payable.

 

Article
6

NO DISPUTES; CONSISTENCY; COOPERATION

 

Section 6.01         Principal
Participation in the Corporation and Holding’s Tax Matters. Except as otherwise provided herein, the Corporation
shall have full responsibility for, and sole discretion over, all Tax matters related to this Agreement concerning the Corporation
and Holdings, including the preparation, filing or amending of any Tax Return and defending, contesting or settling any issue
pertaining to Taxes. Notwithstanding the foregoing, the Corporation shall notify each relevant Principal of, and keep such Principal
reasonably informed with respect to the portion of any audit of the Corporation and Holdings by a Taxing Authority the outcome
of which is reasonably expected to affect such Principal’s rights and obligations under this Agreement, and shall provide
to such Principal reasonable opportunity to provide information and other input to the Corporation, Holdings and their respective
advisors concerning the conduct of any such portion of such audit; provided, however, that the Corporation and Holdings
shall not be required to take any action that is inconsistent with any provision of the Partnership Agreement.

 

Section 6.02         Consistency.
Except upon the written advice of an Advisory Firm, the Corporation and the Applicable Principal agree to report and cause to
be reported for all purposes, including U.S. federal, state, local and foreign Tax purposes and financial reporting purposes,
all Tax-related items (including the Basis Adjustment and each Tax Benefit Payment) in a manner consistent with that specified
by the Corporation in any Schedule required to be provided by or on behalf of the Corporation under this Agreement. Any Dispute
concerning such advice shall be subject to the terms of Section 7.09. In the event that an Advisory Firm is replaced, such replacement
Advisory Firm shall be required to perform its services under this Agreement using procedures and methodologies consistent with
the previous Advisory Firm, unless (a) otherwise required by law or the terms of this Agreement or (b) the Corporation and the
Applicable Principal agree to the use of other procedures and methodologies.

 

    	13

    	 

    

 

Section 6.03         Cooperation.
The Applicable Principal shall (a) furnish to the Corporation in a timely manner such information, documents and other materials
as the Corporation may reasonably request for purposes of making any determination or computation necessary or appropriate under
this Agreement, preparing any Tax Return or contesting or defending any audit, examination or controversy with any Taxing Authority,
(b) make itself available to the Corporation and its representatives to provide explanations of documents and materials and such
other information as the Corporation or its representatives may reasonably request in connection with any of the matters described
in clause (a) above, and (c) reasonably cooperate in connection with any such matter described in clause (a) above. The Corporation
shall reimburse the Applicable Principal for any reasonable and documented third-party costs and expenses incurred pursuant to
this Section 6.03.

 

Article
7

MISCELLANEOUS

 

Section 7.01         Notices.
Any notice, request, claim, demand, approval, consent, waiver or other communication required or permitted to be given to any
party in connection with this Agreement (each, a “Notice”) shall be in writing and shall be (a) delivered in
person, (b) sent by facsimile transmission (with the original thereof also contemporaneously given by another method specified
in this Section 7.01), (c) sent by a nationally-recognized overnight courier service, or (d) sent by certified or registered mail
(postage prepaid, return receipt requested), at the following locations (or at such other location for a party as shall be specified
to the other parties by like Notice). Any Notice shall only be duly given and effective upon receipt (or refusal of receipt).

 

If to either the Corporation or Holdings, to:

 

777 West Putnam Avenue, 3rd Floor

Greenwich, CT 06830

Attention: Leonard M. Tannenbaum

 
Bernard D. Berman

E-mail:  

 

with a copy to:

 

Proskauer Rose LLP

Eleven Times Square

New York, NY 10036

Attention: Frank Lopez

E-mail: 

 

Holdings shall forward any applicable communication to a Principal
to such Principal’s address, e-mail address or facsimile number as shown in the books and records of Holdings.

 

Section 7.02         Counterparts.
This Agreement may be executed (including by facsimile transmission) with counterpart signature pages or in any number of counterparts,
each of which shall be deemed to be an original and all of which shall, taken together, be deemed to be one and the same instrument.

 

    	14

    	 

    

 

Section 7.03         Entire
Agreement; No Third-Party Beneficiaries. This Agreement constitutes the entire agreement among the parties hereto and
supersedes all other prior agreements and understandings, both written and oral, among the parties with respect to the subject
matter hereof. Nothing in this Agreement, express or implied, is intended to or shall confer upon any Person other than the parties
hereto and their respective heirs, successors, legal representatives and permitted assigns, any rights or remedies hereunder.

 

Section 7.04         Governing
Law. This Agreement shall be governed by, construed and enforced in accordance with, the laws of New York, without
regard to the conflict of laws principles thereof that would mandate the application of the laws of another jurisdiction.

 

Section 7.05         Severability.
If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction or other authority
to be invalid, void or unenforceable, all other terms, provisions, covenants and restrictions of this Agreement shall remain in
full force and effect and shall in no way be affected, impaired or invalidated so long as the economic or legal substance of the
transactions contemplated hereby is not affected in any manner materially adverse to any party. Upon such a determination that
any term or other provision is invalid, illegal or incapable of being enforced, the parties hereto shall negotiate in good faith
to modify this Agreement so as to effect the original intent of the parties as closely as possible in an acceptable manner in
order that the transactions contemplated hereby are consummated as originally contemplated to the greatest extent possible.

 

Section 7.06         Successors;
Assignment; Amendments; and Waivers.

 

(a)          No
Principal may assign this Agreement to any person without the prior written consent of the Corporation; provided, however,
that (i) to the extent Units are transferred in accordance with the terms of the Partnership Agreement, the transferring Principal
shall have the option to assign to the transferee of such Units the transferring Principal’s rights under this Agreement
with respect to such transferred Units, as long as such transferee has executed and delivered, or, in connection with such transfer,
executes and delivers, a joinder to this Agreement, in form and substance substantially similar to Exhibit A to this Agreement,
agreeing to become a “Principal” for all purposes of this Agreement, except as otherwise provided in such joinder,
and (ii) once an Exchange has occurred, any and all payments that may become payable to a Principal pursuant to this Agreement
with respect to the Exchanged Units may be assigned to any Person or Persons as long as any such Person has executed and delivered,
or, in connection with such assignment, executes and delivers, a joinder to this Agreement, in form and substance substantially
similar to Exhibit A to this Agreement, agreeing to be bound by Section 7.12 and acknowledging specifically the terms of Section
7.06(b). For the avoidance of doubt, if a Principal transfers Units but does not assign to the transferee of such Units such Principal’s
rights under this Agreement with respect to such transferred Units, such Principal shall continue to be entitled to receive the
Tax Benefit Payments arising in respect of a subsequent Exchange of such Units.

 

(b)          Notwithstanding
the foregoing provisions of this Section 7.06, no transferee described in clause (i) of the first sentence of Section 7.06(a) shall
have the right to enforce the provisions of Section 2.04, 4.02, or 6.02 of this Agreement, and no assignee described in clause
(ii) of the first sentence of Section 7.06(a) shall have any rights under this Agreement except for the right to enforce its right
to receive payments under this Agreement.

 

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(c)          No
provision of this Agreement may be amended unless such amendment is approved in writing by each of the Corporation and Holdings
and by Principals who would be entitled to receive at least two-thirds of the Early Termination Payments payable to all Principals
hereunder if the Corporation had exercised its right of early termination on the date of the most recent Exchange prior to such
amendment (excluding, for purposes of this sentence, all payments made to any Principal pursuant to this Agreement since the date
of such most recent Exchange); provided, however, that no such amendment shall be effective if such amendment would
have a disproportionate effect on the payments certain Principals will or may receive under this Agreement unless all such Principals
disproportionately effected consent in writing to such amendment. No provision of this Agreement may be waived unless such waiver
is in writing and signed by the party against whom the waiver is to be effective.

 

(d)          Except
as otherwise specifically provided herein, all of the terms and provisions of this Agreement shall be binding upon, shall inure
to the benefit of and shall be enforceable by the parties hereto and their respective successors, permitted assigns, heirs, executors,
administrators and legal representatives. The Corporation shall require and cause any direct or indirect successor (whether by
purchase, merger, consolidation or otherwise) to all or substantially all of the business or assets of the Corporation, by written
agreement, expressly to assume and agree to perform this Agreement in the same manner and to the same extent that the Corporation
would be required to perform if no such succession had taken place. Notwithstanding anything to the contrary herein, in the event
a Principal transfers his Units to a Permitted Transferee, excluding any other Principal, such Principal shall have the right,
on behalf of such transferee, to enforce the provisions of Sections 2.04, 4.02 or 6.02 with respect to such transferred Units.

 

Section 7.07         Titles
and Subtitles. The titles of the sections and subsections of this Agreement are for convenience of reference only and
are not to be considered in construing this Agreement.

 

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Section 7.08         Resolution
of Disputes.

 

(a)          Any
and all claims, disputes and other disagreements arising hereunder (each, a “Dispute”) which are not governed
by Section 7.09, including any ancillary claims of any party, arising out of, relating to or in connection with the validity, negotiation,
execution, interpretation, performance or non-performance of this Agreement (including the validity, scope and enforceability of
this Section 7.08 and Section 7.09) shall be governed by this Section 7.08. The parties hereto shall attempt in good faith to resolve
all Disputes by negotiation. If a Dispute between the parties hereto cannot be resolved in such manner, such Dispute shall, at
the request of any party, after providing written notice to the other party or parties to the Dispute, be submitted to arbitration
in New York in accordance with the Commercial Arbitration Rules of the American Arbitration Association then in effect. The proceeding
shall be confidential. The party initially asserting the Dispute (the “Initiating Party”) shall notify the other
party (the “Responding Party”) of the name and address of the arbitrator chosen by the Initiating Party and
shall specifically describe the Dispute in issue to be submitted to arbitration. Within 30 days of receipt of such notification,
the Responding Party shall notify the Initiating Party of its answer to the Dispute, any counterclaim which it wishes to assert
in the arbitration and the name and address of the arbitrator chosen by the Responding Party. If the Responding Party does not
appoint an arbitrator during such 30-day period, appointment of the second arbitrator shall be made by the American Arbitration
Association upon request of the Initiating Party. The two arbitrators so chosen or appointed shall choose a third arbitrator, who
shall serve as president of the panel of arbitrators (the “Panel”) thus composed. If the two arbitrators so
chosen or appointed fail to agree upon the choice of a third arbitrator within 30 days from the appointment of the second arbitrator,
the third arbitrator will be appointed by the American Arbitration Association upon the request of the arbitrators or either of
the parties. In all cases, the arbitrators must be persons who have substantial experience in tax matters and are lawyers admitted
to the practice of law in the State of New York. The arbitrators will act by majority decisions. Any decision of the arbitrators
shall (i) be rendered in writing and shall bear the signatures of at least two arbitrators, and (ii) identify the members of the
Panel, and the time and place of the award granted. Absent fraud or manifest error, any such decision of the Panel shall be final,
conclusive and binding on the parties to the arbitration and enforceable by a court of competent jurisdiction. The expenses of
the arbitration shall be borne equally by the parties to the arbitration; provided, however, that each party shall pay for and
bear the costs of its own experts, evidence and legal counsel, unless the arbitrator rules otherwise in the arbitration. The parties
shall complete all discovery within 30 days after the Panel is composed, shall complete the presentation of evidence to the Panel
within 15 days after the completion of discovery, and a final decision with respect to the matter submitted to arbitration shall
be rendered within 15 days after the completion of presentation of evidence. The parties hereto shall cause to be kept a record
of the proceedings of any matter submitted to arbitration hereunder. Performance under this Agreement shall continue if reasonably
possible during any arbitration proceedings. In addition to monetary damages, the arbitrator shall be empowered to award equitable
relief, including an injunction and specific performance of any obligation under this Agreement. The arbitrator is not empowered
to award damages in excess of compensatory damages, and each party hereby irrevocably waives any right to recover punitive, exemplary
or similar damages with respect to any Dispute. The award shall be the sole and exclusive remedy between the parties regarding
any claims, counterclaims, issues, or accounting presented to the arbitral tribunal. Judgment upon any award may be entered and
enforced in any court having jurisdiction over a party or any of its assets.

 

(b)          Notwithstanding
the provisions of Section 7.08(a), the Corporation may bring an action or special proceeding in any court of competent jurisdiction
for the purpose of compelling a party to arbitrate, seeking temporary or preliminary relief in aid of an arbitration hereunder,
and/or enforcing an arbitration award and, for the purposes of this Section 7.08(b), each Principal (i) expressly consents to the
application of Section 7.08(c) to any such action or proceeding, (ii) agrees that proof shall not be required that monetary
damages for breach of the provisions of this Agreement would be difficult to calculate and that remedies at law would be inadequate,
and (iii) irrevocably appoints the Corporation as such Principal’s agent for service of process in connection with any such
action or proceeding and agrees that service of process upon such agent, who shall promptly advise such Principal in writing of
any such service of process, shall be deemed in every respect effective service of process upon the Principal in any such action
or proceeding.

 

    	17

    	 

    

 

(c)          The
parties hereto agree that any suit, action or proceeding seeking to enforce any provision of, or based on any matter arising out
of or in connection with, this Agreement or the transactions contemplated hereby that is brought in accordance with Section 7.08(b)
shall be brought and maintained exclusively in the United States District Court for the Southern District of New York or the Supreme
Court of the State of New York located in the County of New York. Each of the parties irrevocably consents to submit to the personal
jurisdiction of such courts (and of the appropriate appellate courts therefrom) in any such suit, action or proceeding. Process
in any such suit, action or proceeding in such courts may be served, and shall be effective, on any party anywhere in the world,
whether within or without the jurisdiction of any such court, by any of the methods specified for the giving of Notices pursuant
to Section 7.01. Each of the parties irrevocably waives, to the fullest extent permitted by law, any objection or defense that
it may now or hereafter have based on venue, inconvenience of forum, the lack of personal jurisdiction and the adequacy of service
of process (as long as the party was provided Notice in accordance with the methods specified in Section 7.01) in any suit action
or proceeding brought in such courts. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN
ANY SUIT, ACTION OR PROCEEDING SEEKING TO ENFORCE ANY PROVISION OF, OR BASED ON ANY MATTER ARISING OUT OF OR IN CONNECTION WITH,
THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

 

Section 7.09         Reconciliation.
In the event that the Corporation and the relevant Principal are unable to resolve a disagreement with respect to the matters
governed by Sections 2.04, 4.02 and 6.02 within the relevant period designated in this Agreement (“Reconciliation Dispute”),
the Reconciliation Dispute shall be submitted for determination to a nationally recognized expert (the “Expert”)
in the particular area of disagreement mutually acceptable to both parties. The Expert shall be a partner in a nationally recognized
accounting firm or a law firm (other than the Advisory Firm), and the Expert shall not, and the firm that employs the Expert shall
not, have any material relationship with either the Corporation or the relevant Principal or other actual or potential conflict
of interest. If the parties are unable to agree on an Expert within 15 days of receipt by the respondent(s) of written notice
of a Reconciliation Dispute, the Expert shall be appointed by the International Chamber of Commerce Centre for Expertise. The
Expert shall resolve any matter relating to the Exchange Basis Schedule or an amendment thereto or the Early Termination Schedule
or an amendment thereto within 30 calendar days and shall resolve any matter relating to a Tax Benefit Schedule or an amendment
thereto within 15 calendar days or as soon thereafter as is reasonably practicable, in each case after the matter has been submitted
to the Expert for resolution. Notwithstanding the preceding sentence, if the matter is not resolved before any payment that is
the subject of a disagreement would be due (in the absence of such disagreement) or any Tax Return reflecting the subject of a
disagreement is due, the undisputed amount shall be paid on such date and such Tax Return may be filed as prepared by the Corporation,
subject to adjustment or amendment upon resolution. In the event that this reconciliation provision is utilized, the fees of the
Expert shall be paid in proportion to the manner in which the dispute is resolved, such that, for example, if the entire dispute
is resolved in favor of the Corporation, the relevant Principal shall pay all of the fees, or if the items in dispute are resolved
50% in favor of the Corporation and 50% in favor of the relevant Principal, each of the Corporation and the relevant Principal
shall pay 50% of the fees of the Expert. Any Dispute as to whether a Dispute is a Reconciliation Dispute within the meaning of
this Section 7.09 shall be decided by the Expert. The Expert shall finally determine any Reconciliation Dispute and the determinations
of the Expert pursuant to this Section 7.09 shall be binding on the Corporation and the relevant Principal and may be entered
and enforced in any court having jurisdiction.

 

    	18

    	 

    

 

Section 7.10         Withholding.
The Corporation shall be entitled to deduct and withhold from any payment payable pursuant to this Agreement such amounts as the
Corporation is required to deduct and withhold with respect to the making of such payment under the Code or any provision of state,
local or foreign Tax law. To the extent that amounts are so withheld and paid over to the appropriate Taxing Authority by the
Corporation, such withheld amounts shall be treated for all purposes of this Agreement as having been paid to the Applicable Principal.

 

Section 7.11         Admission
of the Corporation into a Consolidated Group; Transfers of Corporate Assets.

 

(a)          If
the Corporation becomes a member of an affiliated or consolidated group of corporations that files a consolidated income Tax Return
pursuant to Sections 1501, et seq. of the Code or any corresponding provisions of state, local or foreign law, then: (i)
the provisions of this Agreement shall be applied with respect to the group as a whole; and (ii) Tax Benefit Payments, Early Termination
Payments and other applicable items hereunder shall be computed with reference to the consolidated taxable income of the group
as a whole.

 

(b)          If
any entity that is obligated to make an Exchange Payment hereunder transfers one or more assets to a corporation with which such
entity does not file a consolidated Tax Return pursuant to Section 1501 of the Code, such entity, for purposes of calculating the
amount of any Exchange Payment (e.g., calculating the gross income of the entity and determining the Realized Tax Benefit
of such entity) due hereunder, shall be treated as having disposed of such asset in a fully taxable transaction on the date of
such contribution. The consideration deemed to be received by such entity shall be equal to the fair market value of the contributed
asset, plus (i) the amount of debt to which such asset is subject, in the case of a contribution of an encumbered asset or (ii)
the amount of debt allocated to such asset, in the case of a contribution of a partnership interest.

 

Section 7.12         Confidentiality.

 

(a)          Each
Principal and assignee acknowledges and agrees that the information of the Corporation and of its Affiliates is confidential and,
except in the course of performing any duties as necessary for the Corporation and its Affiliates, as required by law or legal
process or to enforce the terms of this Agreement, such person shall keep and retain in the strictest confidence and not disclose
to any Person any confidential matters, acquired pursuant to this Agreement, of the Corporation and its Affiliates and successors,
concerning Holdings and its Affiliates and successors or the other Principals, learned by the Principal heretofore or hereafter.
This Section 7.12(a) shall not apply to (i) any information that has been made publicly available by the Corporation or any
of its Affiliates, becomes public knowledge (except as a result of an act of such Principal in violation of this Agreement) or
is generally known to the business community and (ii) the disclosure of information to the extent necessary for a Principal to
prepare and file his or her Tax Returns, to respond to any inquiries regarding the same from any Taxing authority or to prosecute
or defend any action, proceeding or audit by any Taxing authority with respect to such returns. Notwithstanding anything to the
contrary herein, each Principal and assignee (and each employee, representative or other agent of such Principal or assignee, as
applicable) may disclose to any and all Persons, without limitation of any kind, the Tax treatment and Tax structure of the Corporation,
Holdings, the Principals and their Affiliates, and any of their transactions, and all materials of any kind (including opinions
or other Tax analyses) that are provided to the Principals relating to such Tax treatment and Tax structure.

 

    	19

    	 

    

 

(b)          If
a Principal or assignee commits a breach, or threatens to commit a breach, of any of the provisions of Section 7.12(a), the Corporation
shall have the right and remedy to have the provisions of Section 7.12(a) specifically enforced by injunctive relief or otherwise
by any court of competent jurisdiction without the need to post any bond or other security, it being acknowledged and agreed that
any such breach or threatened breach shall cause irreparable injury to the Corporation or any of its Subsidiaries or the other
Principals and the accounts and funds managed by the Corporation and that money damages alone shall not provide an adequate remedy
to such Persons. Such rights and remedies shall be in addition to, and not in lieu of, any other rights and remedies available
at law or in equity.

 

Section 7.13         Partnerships.
The Corporation hereby agrees that, to the extent it acquires a general partnership interest, managing member interest or similar
interest in any Person after the date hereof, it shall cause such Person to execute and deliver a joinder to this Agreement and
such Person shall be treated as a “partnership” for all purposes of this Agreement.

 

[Signature page follows.]

 

    	20

    	 

    

 

IN WITNESS WHEREOF, the Corporation, Holdings
and each Principal have duly executed this Agreement as of the date first written above.

 

	 	FIFTH STREET ASSET MANAGEMENT INC.
	 	 	 	 
	 	By:	 
	 	 	Name: 
	 	 	Title:
	 	 	 
	 	FIFTH STREET HOLDINGS L.P.
	 	 	 	 
	 	By:	 
	 	 	Name: 
	 	 	Title:

 

    	 

    	 

    

 

	 	PRINCIPALS:
	 	 
	 	 
	 	Name:
	 	 
	 	 
	 	Name:
	 	 
	 	 
	 	Name:

 

    	2

    	 

    

 

EXHIBIT
A

JOINDER

 

This JOINDER (this “Joinder”)
to the Tax Receivable Agreement (as defined below), dated as of ____________, by and among Fifth
Street Asset Management Inc. (the “Corporation”), Fifth Street Holdings L.P., (“Holdings”)
and ______________ (“Permitted Transferee”).

 

WHEREAS, on ____________, the Permitted
Transferee acquired (the “Acquisition”) ___ Units in Holdings (the “Interests” and, together
with all other Interests hereinafter acquired by the Permitted Transferee from Transferor and its Permitted Transferees (as defined
in the Tax Receivable Agreement dated as of ________, 2014 (as the same may be amended from time to time, the “Tax Receivable
Agreement”), among the Corporation, Holdings and the other parties thereto), the “Acquired Interests”)
from ______________ (“Transferor”); and

 

WHEREAS, Transferor, in connection with
the Acquisition, has required Permitted Transferee to execute and deliver this Joinder pursuant to Section 7.06 of the Tax Receivable
Agreement;

 

NOW, THEREFORE, in consideration of the
foregoing and the respective covenants and agreements set forth herein and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, and intending to be legally bound, Permitted Transferee hereby agrees as follows:

 

Section 1.1           Definitions.
To the extent capitalized words used in this Joinder are not defined in this Joinder, such words shall have the respective meanings
set forth in the Tax Receivable Agreement.

 

Section 1.2           Joinder.
Permitted Transferee hereby acknowledges and agrees to become a “Principal” (as defined in the Tax Receivable Agreement)
for all purposes of the Tax Receivable Agreement, including but not limited to, being bound by Sections 2.04, 4.02, 6.01, 6.02
and 7.12 of the Tax Receivable Agreement, with respect to the Acquired Interests, and any other Interests Permitted Transferee
acquires hereafter. Permitted Transferee hereby acknowledges the terms of Section 7.06(b) of the Tax Receivable Agreement.

 

Section 1.3           Notice.
Any notice, request, consent, claim, demand, approval, waiver or other communication hereunder to Permitted Transferee shall be
delivered or sent to Permitted Transferee at the address set forth on the signature page hereto in accordance with Section 7.01
of the Tax Receivable Agreement.

 

Section 1.4           Governing
Law. THIS JOINDER SHALL BE GOVERNED BY, CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REGARD TO THE CONFLICT OF LAWS PRINCIPLES THEREOF THAT WOULD MANDATE THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION.

 

[Signature page follows.]

 

    	 

    	 

    

  

IN WITNESS WHEREOF, this Joinder has been
duly executed and delivered by Permitted Transferee as of the date first above written.

 

	 	[PERMITTED TRANSFEREE]
	 	 
	 	 
	 	Name:
	 	Address:
	 	 
	 	Address for Notices:

 

Signature Page for Joinder by ____________

to the Tax Receivable Agreement

 

    	A-1Exhibit 10.6

 

SECOND AMENDED AND RESTATED INVESTMENT
ADVISORY AGREEMENT

 

BETWEEN

 

FIFTH STREET FINANCE CORP.

 

AND

 

FIFTH STREET MANAGEMENT LLC

 

This Second Amended and Restated Investment
Advisory Agreement (this “Agreement”) made this 2nd day of May 2011, by and between FIFTH STREET
FINANCE CORP., a Delaware corporation (the “Company”), and FIFTH STREET MANAGEMENT LLC, a Delaware limited
liability company (the “Adviser”).

 

WHEREAS, the Company is a closed-end management
investment fund that has elected to be regulated as a business development company (“BDC”) under the
Investment Company Act of 1940, as amended (the “Investment Company Act”); and

 

WHEREAS, the Adviser is organized as an
investment adviser that is registered under the Investment Advisers Act of 1940, as amended (the “Advisers Act”);
and

 

WHEREAS, the Company and the Adviser entered
into an investment advisory agreement, dated December 14, 2007 (the “Original Advisory Agreement”);

 

WHEREAS, the Company and the Adviser entered
into an amended and restated investment advisory agreement, dated April 30, 2008 (the “First Amended and Restated
Advisory Agreement”), which amended and restated in its entirety the Original Advisory Agreement; and

 

WHEREAS, the Company and the Adviser further
desire to amend and restate in its entirety the First Amended and Restated Advisory Agreement to reflect, among other things, (i) the
fact that the Adviser has agreed to permanently waive that portion of its Base Management Fee (as defined below) attributable to
the Company’s assets held in the form of cash and cash equivalents as of the end of each quarter beginning on March 31,
2010 and (ii) changes in certain non-substantive factual matters described therein that occurred subsequent to the date of
the execution of the First Amended and Restated Advisory Agreement.

 

NOW, THEREFORE, in consideration of the
premises and for other good and valuable consideration, the parties hereby agree as follows:

 

    	 

    	 

    

 

1. Duties of the Adviser.

 

(a) The Company hereby employs the
Adviser to act as the investment adviser to the Company and to manage the investment and reinvestment of the assets of the Company,
subject to the supervision of the Board of Directors of the Company, (the “Board”) for the period and
upon the terms herein set forth, (i) in accordance with the investment objective, policies and restrictions that are set forth
in the reports and/or registration statements that the Company files with the Securities and Exchange Commission (the “SEC”)
from time to time; (ii) during the term of this Agreement in accordance with all other applicable federal and state laws,
rules and regulations, and the Company’s charter and by-laws; and (iii) in accordance with the Investment Company Act.
Without limiting the generality of the foregoing, the Adviser shall, during the term and subject to the provisions of this Agreement
(A) determine the composition of the portfolio of the Company, the nature and timing of the changes therein and the manner
of implementing such changes; (B) identify, evaluate and negotiate the structure of the investments made by the Company; (C) close,
monitor and service the Company’s investments; (D) determine the securities and other assets that the Company shall
purchase, retain, or sell; (E) perform due diligence on prospective portfolio companies; and (F) provide the Company
with such other investment advisory, research and related services as the Company may, from time to time, reasonably require for
the investment of its funds. The Adviser shall have the power and authority on behalf of the Company to effectuate its investment
decisions for the Company, including the execution and delivery of all documents relating to the Company’s investments and
the placing of orders for other purchase or sale transactions on behalf of the Company. In the event that the Company determines
to obtain debt financing, the Adviser shall arrange for such financing on the Company’s behalf, subject to the oversight
and approval of the Company’s Board.

 

(b) The Adviser hereby accepts such
employment and agrees during the term hereof to render the services described herein for the compensation provided herein.

 

(c) The Adviser is hereby authorized
to enter into one or more sub-advisory agreements with other investment advisers (each, a “Sub-Adviser”)
pursuant to which the Adviser may obtain the services of the Sub-Adviser(s) to assist the Adviser in fulfilling its responsibilities
hereunder. Specifically, the Adviser may retain a Sub-Adviser to recommend specific securities or other investments based upon
the Company’s investment objective and policies, and work, along with the Adviser, in structuring, negotiating, arranging
or effecting the acquisition or disposition of such investments and monitoring investments on behalf of the Company, subject to
the oversight of the Adviser and the Company. The Adviser and not the Company shall be responsible for any compensation payable
to any Sub-Adviser. Any sub-advisory agreement entered into by the Adviser shall be in accordance with the requirements of the
Investment Company Act and other applicable federal and state law.

 

(d) The Adviser shall, for all purposes
herein provided, be deemed to be an independent contractor and, except as expressly provided or authorized herein, shall have no
authority to act for or represent the Company in any way or otherwise be deemed an agent of the Company.

 

(e) Subject to review by and the overall
control of the Board of the Company, the Adviser shall keep and preserve for the period required by the Investment Company Act
any books and records relevant to the provision of its investment advisory services to the Company and shall specifically maintain
all books and records with respect to the Company’s portfolio transactions and shall render to the Company’s Board
such periodic and special reports as the Board may reasonably request. The Adviser agrees that all records that it maintains for
the Company are the property of the Company and shall surrender promptly to the Company any such records upon the Company’s
request, provided that the Adviser may retain a copy of such records.

 

    	2

    	 

    

 

2. Company’s Responsibilities and Expenses Payable
by the Company.

 

All personnel of the Adviser, when and
to the extent engaged in providing investment advisory services hereunder, and the compensation and routine overhead expenses of
such personnel allocable to such services, shall be provided and paid for by the Adviser and not by the Company. The Company shall
bear all other costs and expenses of its operations and transactions, including (without limitation) fees and expenses relating
to: organizational and offering expenses; the investigation and monitoring of the Company’s investments; the cost of calculating
the Company’s net asset value; the cost of effecting sales and repurchases of shares of the Company’s common stock
and other securities; management and incentive fees payable pursuant to the investment advisory agreement; fees payable to third
parties relating to, or associated with, making investments and valuing investments (including third-party valuation firms); transfer
agent and custodial fees; fees and expenses associated with marketing efforts (including attendance at investment conferences and
similar events); federal and state registration fees; any exchange listing fees; federal, state and local taxes; independent directors’
fees and expenses; brokerage commissions; costs of proxy statements, stockholders’ reports and notices; costs of preparing
government filings, including periodic and current reports with the SEC; fidelity bond, liability insurance and other insurance
premiums; and printing, mailing, independent accountants and outside legal costs and all other direct expenses incurred by either
FSC, Inc. or the Company in connection with administering the Company’s business, including payments under the administration
agreement dated as of May 2, 2011 (the “Adminstration Agreement”) that will be based upon the Company’s
allocable portion of overhead and other expenses incurred by the Company’s administrator, FSC, Inc., in performing its obligations
under the Administration Agreement and the compensation of the Company’s chief financial officer and chief compliance officer,
and their respective staffs.

 

3. Compensation of the Adviser.

 

The Company agrees to pay, and the Adviser
agrees to accept, as compensation for the services provided by the Adviser hereunder, a base management fee (“Base
Management Fee”) and an incentive fee (“Incentive Fee”) as hereinafter set forth. The Adviser
may agree to temporarily or permanently waive, in whole or in part, the Base Management Fee and/or the Incentive Fee. See Appendix A
for examples of how these fees are calculated.

 

(a) The Base Management Fee shall
be calculated at an annual rate of 2% of the Company’s gross assets, excluding any cash and cash equivalents. For purposes
of this Agreement, the term “cash and cash equivalents” will have the meaning ascribed to it from time to time in the
notes to the financial statements that the Company files with the SEC. The Base Management Fee shall be payable quarterly in arrears,
and shall be calculated based on the value of the Company’s gross assets at the end of each fiscal quarter, and appropriately
adjusted for any equity capital raises or repurchases during such quarter. The Base Management Fee for any partial month or quarter
shall be appropriately prorated.

 

(b) The Incentive Fee shall consist
of two parts, as follows:

 

    	3

    	 

    

 

		(i)	The first part shall be calculated and payable quarterly in arrears based on the Company’s ‘‘Pre-Incentive
Fee Net Investment Income’’ for the immediately preceding fiscal quarter. For this purpose, ‘‘Pre-Incentive
Fee Net Investment Income’’ means interest income, dividend income and any other income (including any other fees (other
than fees for providing managerial assistance), such as commitment, origination, structuring, diligence and consulting fees or
other fees that the Company receives from portfolio companies) accrued during the fiscal quarter, minus the Company’s operating
expenses for the quarter (including the Base Management Fee, expenses payable under the Administration Agreement with FSC, Inc.,
and any interest expense and dividends paid on any issued and outstanding preferred stock, but excluding the Incentive Fee). Pre-Incentive
Fee Net Investment Income includes, in the case of investments with a deferred interest feature (such as original issue discount,
debt instruments with payment-in-kind interest and zero coupon securities), accrued income that the Company has not yet received
in cash. Pre-Incentive Fee Net Investment Income does not include any realized capital gains, realized capital losses or unrealized
capital appreciation or depreciation. Pre-Incentive Fee Net Investment Income, expressed as a rate of return on the value of the
Company’s net assets at the end of the immediately preceding fiscal quarter, shall be compared to a ‘‘hurdle
rate’’ of 2% per quarter (8% annualized), subject to a ‘‘catch-up’’ provision measured as of
the end of each fiscal quarter. The Company’s net investment income used to calculate this part of the incentive fee is also
included in the amount of the Company’s gross assets used to calculate the 2% base management fee. The operation of the incentive
fee with respect to the Company’s Pre-Incentive Fee Net Investment Income for each quarter is as follows:

 

		•	No incentive fee is payable to the Adviser in any fiscal quarter in which the Company’s Pre-Incentive Fee Net Investment
Income does not exceed the hurdle rate of 2% (the ‘‘preferred return’’ or ‘‘hurdle’’).

 

		•	100% of the Company’s Pre-Incentive Fee Net Investment Income with respect to that portion of such Pre-Incentive Fee
Net Investment Income, if any, that exceeds the hurdle rate but is less than or equal to 2.5% in any fiscal quarter (10% annualized)
is payable to the Adviser. The Company refers to this portion of the Company’s Pre-Incentive Fee Net Investment Income (which
exceeds the hurdle rate but is less than or equal to 2.5%) as the ‘‘catch-up.’’ The ‘‘catch-up’’
provision is intended to provide the Adviser with an incentive fee of 20% on all of the Company’s Pre-Incentive Fee Net Investment
Income as if a hurdle rate did not apply when the Company’s Pre-Incentive Fee Net Investment Income exceeds 2.5% in any fiscal
quarter; and

 

		•	20% of the amount of the Company’s Pre-Incentive Fee Net Investment Income, if any, that exceeds 2.5% in any fiscal quarter
(10% annualized) is payable to the Adviser once the hurdle is reached and the catch-up is achieved, (20% of all Pre-Incentive Fee
Net Investment Income thereafter is allocated to the Adviser).

 

    	4

    	 

    

 

		(ii)	The second part of the incentive fee shall be determined and payable in arrears as of the end of each fiscal year (or upon
termination of the investment advisory agreement, as of the termination date), commencing on September 30, 2008 and shall
equal 20% of the Company’s realized capital gains, if any, on a cumulative basis from inception through the end of each fiscal
year, computed net of all realized capital losses and unrealized capital depreciation on a cumulative basis, less the aggregate
amount of any previously paid capital gain incentive fees.

 

4. Covenants of the Adviser.

 

The Adviser covenants that it will maintain
its registration as an investment adviser under the Advisers Act. The Adviser agrees that its activities will at all times be in
compliance in all material respects with all applicable federal and state laws governing its operations and investments.

 

5. Brokerage Commissions.

 

The Adviser is hereby authorized, to the
fullest extent now or hereafter permitted by law, to cause the Company to pay a member of a national securities exchange, broker
or dealer an amount of commission for effecting a securities transaction in excess of the amount of commission another member of
such exchange, broker or dealer would have charged for effecting that transaction, if the Adviser determines in good faith, taking
into account such factors as price (including the applicable brokerage commission or dealer spread), size of order, difficulty
of execution, and operational facilities of the firm and the firm’s risk and skill in positioning blocks of securities, that
such amount of commission is reasonable in relation to the value of the brokerage and/or research services provided by such member,
broker or dealer, viewed in terms of either that particular transaction or its overall responsibilities with respect to the Company’s
portfolio, and constitutes the best net results for the Company.

 

6. Other Activities of the Adviser.

 

The services of the Adviser to the Company
are not exclusive, and the Adviser may engage in any other business or render similar or different services to others including,
without limitation, the direct or indirect sponsorship or management of other investment based accounts or commingled pools of
capital, however structured, having investment objectives similar to those of the Company, so long as its services to the Company
hereunder are not impaired thereby, and nothing in this Agreement shall limit or restrict the right of any manager, partner, member
(including its members and the owners of its members), officer or employee of the Adviser to engage in any other business or to
devote his or her time and attention in part to any other business, whether of a similar or dissimilar nature, or to receive any
fees or compensation in connection therewith (including fees for serving as a director of, or providing consulting services to,
one or more of the Company’s portfolio companies, subject to applicable law). So long as this Agreement or any extension,
renewal or amendment remains in effect, the Adviser shall be the only investment adviser for the Company, subject to the Adviser’s
right to enter into sub-advisory agreements. The Adviser assumes no responsibility under this Agreement other than to render the
services called for hereunder. It is understood that directors, officers, employees and stockholders of the Company are or may
become interested in the Adviser and its affiliates, as directors, officers, employees, partners, stockholders, members, managers
or otherwise, and that the Adviser and directors, officers, employees, partners, stockholders, members and managers of the Adviser
and its affiliates are or may become similarly interested in the Company as stockholders or otherwise.

 

    	5

    	 

    

 

7. Responsibility of Dual Directors, Officers and/or Employees.

 

If any person who is a manager, partner,
member, officer or employee of the Adviser is or becomes a director, officer and/or employee of the Company and acts as such in
any business of the Company, then such manager, partner, member, officer and/or employee of the Adviser shall be deemed to be acting
in such capacity solely for the Company, and not as a manager, partner, member, officer or employee of the Adviser or under the
control or direction of the Adviser, even if paid by the Adviser.

 

8. Limitation of Liability of the Adviser; Indemnification.

 

The Adviser (and its officers, managers,
partners, members (and their members, including the owners of their members), agents, employees, controlling persons and any other
person or entity affiliated with the Adviser) shall not be liable to the Company for any action taken or omitted to be taken by
the Adviser in connection with the performance of any of its duties or obligations under this Agreement or otherwise as an investment
adviser of the Company (except to the extent specified in Section 36(b) of the Investment Company Act concerning loss resulting
from a breach of fiduciary duty (as the same is finally determined by judicial proceedings) with respect to the receipt of compensation
for services, and the Company shall indemnify, defend and protect the Adviser (and its officers, managers, partners, members (and
their members, including the owners of their members), agents, employees, controlling persons and any other person or entity affiliated
with the Adviser, each of whom shall be deemed a third party beneficiary hereof) (collectively, the “Indemnified Parties”)
and hold them harmless from and against all damages, liabilities, costs and expenses (including reasonable attorneys’ fees
and amounts reasonably paid in settlement) incurred by the Indemnified Parties in or by reason of any pending, threatened or completed
action, suit, investigation or other proceeding (including an action or suit by or in the right of the Company or its security
holders) arising out of or otherwise based upon the performance of any of the Adviser’s duties or obligations under this
Agreement or otherwise as an investment adviser of the Company. Notwithstanding the preceding sentence of this Section 8 to
the contrary, nothing contained herein shall protect or be deemed to protect the Indemnified Parties against or entitle or be deemed
to entitle the Indemnified Parties to indemnification in respect of, any liability to the Company or its security holders to which
the Indemnified Parties would otherwise be subject by reason of willful misfeasance, bad faith or gross negligence in the performance
of the Adviser’s duties or by reason of the reckless disregard of the Adviser’s duties and obligations under this Agreement.

 

    	6

    	 

    

 

9. Effectiveness, Duration and Termination of Agreement.

 

This Agreement shall become effective as
of the date above written. This Agreement shall remain in effect until March 1, 2012, and thereafter shall continue
automatically for successive annual periods, provided that such continuance is specifically approved at least annually by (a) the
vote of the Company’s Board, or by the vote of a majority of the outstanding voting securities of the Company and (b) the
vote of a majority of the Company’s directors who are not parties to this Agreement or “interested persons” (as
such term is defined in Section 2(a)(19) of the Investment Company Act) of any such party, in accordance with the requirements
of the Investment Company Act and each of whom is an “independent director” under applicable New York Stock Exchange
listing standards. This Agreement may be terminated at any time, without the payment of any penalty, upon 60 days’ written
notice, by the vote of a majority of the outstanding voting securities of the Company, or by the vote of the Company’s directors
or by the Adviser. This Agreement shall automatically terminate in the event of its “assignment” (as such term is defined
for purposes of Section 15(a)(4) of the Investment Company Act). The provisions of Paragraph 8 of this Agreement shall
remain in full force and effect, and the Adviser shall remain entitled to the benefits thereof, notwithstanding any termination
of this Agreement.

 

10. Notices.

 

Any notice under this Agreement shall be
given in writing, addressed and delivered or mailed, postage prepaid, to the other party at its principal office.

 

11. Amendments.

 

This Agreement may be amended by mutual
consent.

 

12. Entire Agreement; Governing Law.

 

This Agreement contains the entire agreement
of the parties and supersedes all prior agreements, understandings and arrangements with respect to the subject matter hereof.
Notwithstanding the place where this Agreement may be executed by any of the parties hereto, this Agreement shall be construed
in accordance with the laws of the State of New York. For so long as the Company is regulated as a BDC under the Investment Company
Act, this Agreement shall also be construed in accordance with the applicable provisions of the Investment Company Act. In such
case, to the extent the applicable laws of the State of New York, or any of the provisions herein, conflict with the provisions
of the Investment Company Act, the latter shall control. To the fullest extent permitted by law, in the event of any dispute arising
out of the terms and conditions of this Agreement, the parties hereto consent and submit to the jurisdiction of the courts of the
State of New York in the county of New York and of the U.S. District Court for the Southern District of New York.

 

    	7

    	 

    

 

IN WITNESS WHEREOF, the parties hereto
have caused this Agreement to be duly executed on the date above written.

 

	 	FIFTH STREET FINANCE CORP.
	 	 	 
	 	By:	/s/ Leonard M. Tannenbaum 
	 	 	Name:	Leonard M. Tannenbaum
	 	 	Title:	Chief Executive Officer
	 	 	 
	 	FIFTH STREET MANAGEMENT LLC
	 	 	 
	 	By:	/s/ Bernard D. Berman 
	 	 	Name:	Bernard D. Berman
	 	 	Title:	President

 

    	8

    	 

    

 

Appendix A

 

Example 1: Income Related Portion of Incentive Fee for Each
Fiscal Quarter

 

Alternative 1

 

Assumptions

 

Investment income (including interest,
dividends, fees, etc.) = 1.25%

Hurdle rate(1) = 2%

Management fee(2) = 0.5%

Other expenses (legal, accounting, custodian,
transfer agent, etc.)(3) = 0.2%

Pre-Incentive Fee Net Investment Income

(investment income — (management
fee + other expenses) = 0.55%

Pre-Incentive Fee Net Investment Income
does not exceed hurdle rate, therefore there is no income-related incentive fee.

 

Alternative 2

 

Assumptions

 

Investment income (including interest,
dividends, fees, etc.) = 2.9%

Hurdle rate(1) = 2%

Management fee(2) = 0.5%

Other expenses (legal, accounting, custodian,
transfer agent, etc.)(3) = 0.2%

Pre-Incentive Fee Net Investment Income

(investment income — (management
fee + other expenses) = 2.2%

Incentive fee = 100% X Pre-Incentive Fee
Net Investment Income (subject to ‘‘catch-up’’)(4)

= 100% X (2.2% — 2%)

= 0.2%

 

Pre-Incentive Fee Net Investment Income
exceeds the hurdle rate, but does not fully satisfy the ‘‘catch-up’’ provision, therefore the income related
portion of the incentive fee is 0.2%.

 

Alternative 3

 

Assumptions

 

Investment income (including interest,
dividends, fees, etc.) = 3.5%

Hurdle rate(1) = 2%

Management fee(2) = 0.5%

Other expenses (legal, accounting, custodian,
transfer agent, etc.)(3) = 0.2%

Pre-Incentive Fee Net Investment Income

(investment income — (management
fee + other expenses) = 2.8%

Incentive fee = 100% _ Pre-Incentive Fee
Net Investment Income (subject to ‘‘catch-up’’)(4)

 

Incentive fee = 100% X ‘‘catch-up’’
+ (20% X (Pre-Incentive Fee Net Investment Income — 2.5%))

 

Catch up = 2.5% — 2%

 

= 0.5%

 

Incentive fee = (100% X 0.5%) + (20% X
(2.8% — 2.5%))

 

= 0.5% + (20% X 0.3%)

 

= 0.5% + 0.06%

 

= 0.56%

 

    	9

    	 

    

  

Pre-Incentive Fee Net Investment Income exceeds the
hurdle rate, and fully satisfies the ‘‘catch-up’’ provision, therefore the income related portion of the
incentive fee is 0.56%.

 

 

 

		(1)	Represents 8% annualized hurdle rate.

 

		(2)	Represents 2% annualized base management fee.

 

		(3)	Excludes organizational and offering expenses.

 

		(4)	The ‘‘catch-up’’ provision is intended to provide the Adviser with an incentive fee of 20% on all Pre-Incentive
Fee Net Investment Income as if a hurdle rate did not apply when the Company’s net investment income exceeds 2.5% in any
fiscal quarter.

 

Example 2: Capital Gains Portion of Incentive Fee(*):

 

Alternative 1:

 

Assumptions

 

Year 1: $20 million investment made in Company
A (‘‘Investment A’’), and $30 million investment made in Company B (‘‘Investment B’’)

Year 2: Investment A sold for $50 million and
fair market value (‘‘FMV’’) of Investment B determined to be $32 million

Year 3: FMV of Investment B determined to be $25 million

Year 4: Investment B sold for $31 million

 

The capital gains portion of the incentive fee would be:

 

Year 1: None

Year 2: Capital gains incentive fee of $6 million
($30 million realized capital gains on sale of Investment A multiplied by 20%)

Year 3: None à
$5 million (20% multiplied by ($30 million cumulative capital gains less $5 million cumulative capital depreciation))
less $6 million (previous capital gains fee paid in Year 2)

Year 4: Capital gains incentive fee of $200,000 à
$6.2 million ($31 million cumulative realized capital gains multiplied by 20%) less $6 million (capital gains incentive
fee taken in Year 2)

 

Alternative 2

 

Assumptions

 

Year 1: $20 million investment made in Company
A (‘‘Investment A’’), $30 million investment made in Company B (‘‘Investment B’’)
and $25 million investment made in Company C (‘‘Investment C’’)

Year 2: Investment A sold for $50 million,
FMV of Investment B determined to be $25 million and FMV of Investment C determined to be $25 million

Year 3: FMV of Investment B determined to be $27 million
and Investment C sold for $30 million

Year 4: FMV of Investment B determined to be $35 million

Year 5: Investment B sold for $20 million

 

The capital gains incentive fee, if any, would be:

 

Year 1: None

Year 2: $5 million capital gains incentive fee
à 20% multiplied by $25 million ($30 million realized capital gains on
Investment A less unrealized capital depreciation on Investment B)

 

    	10

    	 

    

 

Year 3: $1.4 million capital gains incentive
fee(1) à $6.4 million (20% multiplied by $32 million ($35 million
cumulative realized capital gains less $3 million unrealized capital depreciation)) less $5 million capital gains incentive
fee received in Year 2

Year 4: None

Year 5: None à
$5 million (20% multiplied by $25 million (cumulative realized capital gains of $35 million less realized capital
losses of $10 million)) less $6.4 million cumulative capital gains incentive fee paid in Year 2 and Year 3(2)

 

 

 

		*	The hypothetical amounts of returns shown are based on a percentage of the Company’s total net assets and assume no leverage.
There is no guarantee that positive returns will be realized and actual returns may vary from those shown in this example.

 

		(1)	As illustrated in Year 3 of Alternative 1 above, if the Company were to be wound up on a date other than its fiscal year end
of any year, the Company may have paid aggregate capital gains incentive fees that are more than the amount of such fees that would
be payable if the Company had been wound up on its fiscal year end of such year.

 

		(2)	As noted above, it is possible that the cumulative aggregate capital gains fee received by the Adviser ($6.4 million)
is effectively greater than $5 million (20% of cumulative aggregate realized capital gains less net realized capital losses
or net unrealized depreciation ($25 million)).

 

    	11

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